Kowalski v Cole

Case [2017] SASCFC 23

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court: Civil)

KOWALSKI v COLE

[2017] SASCFC 23

Judgment of The Full Court

(The Honourable Justice Blue, The Honourable Justice Nicholson and The Honourable Justice Hinton)

24 March 2017

WORKERS' COMPENSATION - PROCEEDINGS TO OBTAIN COMPENSATION - DETERMINATION OF CLAIMS - APPEALS, JUDICIAL REVIEW AND STATED CASES - RIGHT OF APPEAL

ESTOPPEL - ESTOPPEL BY JUDGMENT - RES JUDICATA OR CAUSE OF ACTION ESTOPPEL

ESTOPPEL - ESTOPPEL BY JUDGMENT - ANSHUN ESTOPPEL

LIMITATION OF ACTIONS - LIMITATION OF PARTICULAR ACTIONS

PROFESSIONS AND TRADES - LAWYERS - COMPLAINTS AND DISCIPLINE - DISCIPLINARY PROCEEDINGS - SOUTH AUSTRALIA

Appeal against judgment of Full Court of Industrial Relations Court.

The appellant issued a summons in the Industrial Relations Court against the respondents claiming that they breached section 41 of the Workmen’s Compensation Act 1971 by recovering costs in respect of proceedings under the Act in the absence of an order of the Court awarding those costs.

The respondents brought a strike out application on the ground that no reasonable cause of action was disclosed or the proceeding was an abuse of process seeking to relitigate matters previously determined in earlier proceedings. 

The Judge summarily dismissed the summons on the ground that the Court did not have jurisdiction to entertain the claim; it was statute-barred in any event; and it was barred by Anshun estoppel or was an abuse of process because the appellant was attempting to relitigate mattes previously decided.

The Full Court of the Industrial Relations Court held that the Judge erred on the issues of jurisdiction and time limitation. However, the Full Court held that the proceeding was an abuse of process because it was brought for the improper purpose of harassing the respondents and made an order staying the proceeding in lieu of the Judge’s dismissal of it.

The appellant appeals against the judgment of the Full Court on the ground that it erred in law in holding that the proceeding was an abuse of process as brought for an improper purpose. The respondents rely on a notice of contention that the Full Court erred on the jurisdiction and time limitation issues. The respondents seek permission to amend their notice of contention to contend that the Full Court erred in failing to find that the matter should have been raised by the appellant in previous proceedings and the summons was therefore an abuse of process.

Held:

1. (Per Blue J at [78], Nicholson and Hinton JJ agreeing)

Permission should be granted to the respondent to amend the notice of contention.

2. (Per Blue J at [49], Nicholson J agreeing)

The Industrial Relations Court had jurisdiction to entertain the claim.

(Per Hinton J at [136])

The Industrial Relations Court did not have jurisdiction to entertain the claim.

3. (Per Blue J at [56], Hinton J agreeing)

The claim was not statute-barred.

(Per Nicholson J at [123])

The claim was statute-barred.

4. (Per Blue J at [76], Hinton J agreeing)

The Full Court erred in law by…

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AGLC
Kowalski v Cole [2017] SASCFC 23
Case
[2017] SASCFC 23
Decision Date

CaseChat Overview and Summary

This case concerned an appeal to the Full Court of the Industrial Relations Court of South Australia by Mr Kowalski against RJ Cole & Partners. The dispute arose from Mr Kowalski's contention that RJ Cole & Partners had failed to provide him with a bill of costs in taxable form. This followed earlier proceedings where Mr Kowalski had suffered an eye injury in 1986 and a back injury in 1989, both while employed by Mitsubishi Motors Australia Ltd.

The legal issues before the court included whether Mr Kowalski's claim for a bill of costs was out of time and therefore statute-barred, and whether the claim constituted an abuse of process. The court also considered whether RJ Cole & Partners should be granted permission to amend their notice of contention.

Nicholson J, in his reasons, agreed with the analysis of Blue J on most issues but differed on the question of the time limitation. Nicholson J concluded that the appellant's claim was indeed out of time and therefore statute-barred, leading him to uphold that ground in the respondents' Notice of Contention and dismiss the appeal. He also agreed with the Full Court of the Industrial Relations Court that the appellant's claim was vexatious and an abuse of process, finding no material procedural unfairness in that determination.

Despite Nicholson J's conclusion on the time limitation, Blue J, whose account of the history and analysis was adopted by Nicholson J, took a different view on the time limitation issue. Blue J's approach would have led to the appeal being allowed, the orders of the Full Court being set aside, and the matter being remitted to the Industrial Relations Court for determination. However, the ultimate outcome, as stated by Nicholson J, was that permission should be granted to RJ Cole & Partners to amend their notice of contention, the appeal should be allowed, the orders made by the Full Court should be set aside, and in lieu thereof, an order dismissing RJ Cole & Partners’ application to strike out Mr Kowalski’s summons should be made, with the matter remitted to the Industrial Relations Court.

Orders

Orders of the court

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Background

Background to the litigation

Although the Act was repealed with effect on 30 September 1987 by the Worker’s Rehabilitation and Compensation Act 1986 (SA), under the transitional provisions of the latter Act, the Act continues to apply in respect of a disability attributable to trauma occurring before 30 September 1987.[4][4] Clause 2(1) of the First Schedule.Background In 1986, Mr Kowalski suffered an eye injury while employed by Mitsubishi Motors Australia Ltd (Mitsubishi). This injury was governed by the Act. In January 1988, Mr Kowalski retained Stanley & Partners, and in particular Tim Bourne, to act for him in claims for workers compensation and at common law. In August 1989, Mr Bourne filed a summons in the District Court on behalf of Mr Kowalski against Mitsubishi (the eye injury action). In January 1991, Mr Bourne advised Mr Kowalski that he should file an application in the Industrial Court to finalise Mr Kowalski’s workers compensation claim and prepared documents for that purpose. In February 1991, Mr Kowalski instructed RJ Cole & Partners to take over from Stanley & Partners the conduct of his eye injury claims and they did so in mid-1991. In July 1992, RJ Cole & Partners filed an application in the general form in the Industrial Court to finalise Mr Kowalski’s workers compensation claims in respect of the eye injury and other injuries governed by the Act (the 1992 workers compensation proceeding). In August 1992, Mitsubishi and Mr Kowalski agreed to settle all claims by Mr Kowalski for approximately $80,000, including all claims governed by the Act for $23,000, subject to the approval of the Chief Executive Officer of WorkCover Corporation. In August 1992, consent orders were made by the Industrial Court in the 1992 workers compensation proceeding that Mitsubishi pay to Mr Kowalski $23,000 in finalisation of his workers compensation and common law entitlements in respect of the eye injury and other injuries governed by the Act. In August 1992, Mitsubishi’s solicitors paid to RJ Cole & Partners’ trust account $23,000 pursuant to the consent orders. The Chief Executive Officer of WorkCover Corporation subsequently refused to approve the settlement. In 1989, Mr Kowalski suffered a back injury at Mitsubishi. This injury was governed by the Worker’s Rehabilitation and Compensation Act 1986 (SA). In September 1989, he retained RJ Cole & Partners to act for him in a claim for workers compensation, and later in a claim at common law, in respect of his back injury. In 1990, RJ Cole & Partners instituted a common law action in the District Court on behalf of Mr Kowalski against Mitsubishi in respect of the back injury (the back injury action). In July 1992, Judge Lee dismissed the back injury action. In August and September 1992, RJ Cole & Partners transferred the majority of $23,000 held in their trust account in payment of their accounts. In October 1995, Mr Kowalski filed a summons in the District Court against RJ Cole & Partners contending that they had failed to serve a bill of costs in taxable form upon him. In July 1996, RJ Cole & Partners lodged in the Supreme Court a bill of costs for taxation pursuant to section 42(1) of the Legal Practitioners Act 1981 (SA) (the taxation proceeding).

Evidence

Evidence Before The Court

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Decision

Reasons for decision

It may be expected that the Court would direct RJ Cole & Partners to prepare a bill of costs showing the date, description and charge for each item of work done in in respect of proceedings under the Act by reference to the Industrial Relations Court scale and then direct a short hearing to determine the above four issues.Conclusion Permission should be granted to RJ Cole & Partners to amend their notice of contention. The appeal should be allowed. The orders made by the Full Court should be set aside and in lieu thereof an order made dismissing RJ Cole & Partners’ 10 May 2011 application to strike out Mr Kowalski’s summons. The matter should be remitted to the Industrial Relations Court to hear and determine the proceeding. NICHOLSON J: I am grateful to have had the benefit of Blue J’s account of the relevant history to this appeal and of his Honour’s analysis of the various issues arising in accordance with the Notice of Appeal and the respondents’ Notice of Contention. I agree with that analysis, save for the two matters next identified. I take a different view with respect to the question of whether the appellant’s claim is out of time and therefore statute barred. Unfortunately this difference in approach leads me to the conclusion that this ground in the respondents’ Notice of Contention should be upheld and the appeal dismissed. Further, whilst my view of the time limitation issue means that it is unnecessary for me to decide, I agree with the conclusion of the Full Court of the Industrial Relations Court that the appellant’s claim is vexatious and an abuse of process for the reasons the Full Court has given.[54] I see no need to comment further on those reasons other than to observe that, unlike and with respect to Blue J, I am not persuaded that the appellant has suffered any material procedural unfairness in the manner that this issue was decided by the Full Court.[54] Kowalski v Bourne and RJ Cole and Partners [2015] SAIRC 17 at [72]-[96]. I turn to consider the time limitation point. On 31 August 1992, the solicitors for Mitsubishi Motors Australia Ltd (MMAL)[55] paid to the respondents’ trust account the sum of $23,000 pursuant to consent orders made by the Industrial Relations Court. These orders were made by way of a purported finalisation of the appellant’s workers compensation proceedings with respect to work injuries, in particular an eye injury, suffered in 1986.[55] MMAL was, at material times, the employer of the appellant. On the same day that the $23,000 was deposited by MMAL into the respondents’ trust account, the respondents transferred $18,634.66 to their office account in purported satisfaction of an account for legal fees and disbursements dated 30 March 1992 rendered with respect to the trial of a back injury claim in the District Court. That injury had been suffered in 1989. On 2 September 1992, a further sum of $483.79 was transferred in purported satisfaction of an account for legal fees and disbursements which had been rendered in connection with the eye injury claim.

Ratio Decidendi

Legal Principle Established

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