Kowalski v Cole - [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 holding that the proceeding was an abuse of process as brought for an improper purpose because this was not the basis of the strike-out application by the respondent, had not been decided by the Judge below, and the appellant was not afforded procedural fairness in relation to this question.
(Per Nicholson J at [104])
The Full Court did not err in holding that the proceeding was an abuse of process.
5. (Per Blue J at [91], Nicholson and Hinton JJ agreeing)
The claim was not barred by Anshun estoppel.
6. (Per Blue J at [97], Hinton J agreeing)
The Judge below erred in holding that the proceeding was an abuse of process on the relitigation ground given the manner in which that contention was advanced by the respondent before the Judge.
7. (Per Nicholson J at [124] and Hinton J at [141])
Appeal allowed. Order of the Full Court set aside and in lieu therefore appeal from the Judge be dismissed.
(Per Blue J at [102])
The appeal should be allowed, the judgment of the Full Court set aside, the respondent’s strike-out application dismissed and the matter remitted to the Industrial Relations Court to hear and determine the proceeding.
Limitations of Actions Act 1936 (SA) s 35, s 38; Worker’s Rehabilitation and Compensation Act 1986 (SA) sch 1; Workers Compensation Rules 1980 (SA) r 120(1), r 122, r 123(1), r 125, r 126, r 127; Workmen’s Compensation Act 1971 (SA) s 21, s 41, s 47, s 130; Legal Practitioners Act 1981 (SA) s 42; Industrial Conciliation and Arbitration Act 1972 (SA) s 15(1)(e); Workers Compensation Act 1971 (SA) s 41; Attorneys and Solicitors Act 1870 (UK); Solicitors Act 1957 (UK) s 69(2)(iii); Legal Practitioners (Miscellaneous) Amendment Act 2013 (SA) s 42, referred to.
Attorney-General v Knight [2014] VSC 549; Clare v Joseph [1907] 2 KB 369; Electrical Trades Union v Tarlo [1964] Ch 720; Greenhalgh v Mallard [1947] 2 All ER 255; Henderson v Henderson (1843) 3 Hare 100 (67 ER 313); McDonald v The State of South Australia [2011] FCA 297; Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; Re P’s Bill of Costs (1982) 45 ALR 513; Spalla v St George Motor Finance Ltd (No 6) [2004] FCA 1699; State Bank of New South Wales v Stenhouse Ltd (1997) Aust Torts Reports 81-423; The Queen v Industrial Court of South Australia; Ex parte General Motors-Holden Pty Ltd (1975) 10 SASR 582; Woolf v Snipe (1933) 48 CLR 677, discussed.
4WD Pty Ltd v McNamara [2009] SASC 274; Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; Clyne v New South Wales Bar Association (1960) 104 CLR 186; DA Starke Pty Ltd v Yardoo Pty Ltd (2009) 262 LSJS 248; Emeritus Pty Ltd v Mobbs (unreported, New South Wales Supreme Court, 27/6/1991); Greenhalgh v Mallard [1947] 2 All ER 255; Harrison v Tew [1990] 1 All ER 321; In re A Solicitor [1961] 1 Ch 491; Jago v District Court (NSW) (1989) 168 CLR 23; Kooky Garments Ltd v Charlton [1994] 1 NZLR 587; Kowalski v Bourne [2011] SAIRC 62; Kowalski v Bourne and RJ Cole & Partners [2015] SAIRC 17; Kowalski v Cole & Ors [2011] SAIRC 61; Kowalski v Cole & Ors; Kowalski v Bourne [2015] SASCFC 169; Kowalski v Stanley & Partners & Anor [2014] SASC 198; Metropolitan Bank Ltd v Pooley (1885) 10 App Cas 210; Myers v Elman [1940] AC 282; New South Wales Crime Commission v Fleming (1991) 24 NSWLR 116; R v Dick [1982] Tas R 252; R v Turner [1970] 2 QB 321; Re a Barrister & Solicitor (1979) 40 FLR 1; Re a Solicitor [1960] VR 617; Re Feez Ruthning’s Bill of Costs [1989] 1 Qd R 55; Richfort Pty Ltd v Baluyut (1999) 9 NTLR 58; Sanderson v Glass (1742) 2 Atk 296; Storer & Co v Johnson (1890) 15 App Cas 203; Voth v Manildra Flower Mills Pty Ltd (1990) 171 CLR 538; Walton v Gardiner (1993) 177 CLR 378; Wentworth v Graham [2003] NSWCA 307; Williams v Spautz (1992) 174 CLR 509, considered.

KOWALSKI v COLE
[2017] SASCFC 23
Full Court: Blue, Nicholson and Hinton JJ

BLUE J: This is appeal against a judgment of the Full Court of the Industrial Relations Court on appeal from a judgment of a single Judge of that Court.
The appellant Kazimir Kowalski issued a summons in the Industrial Relations Court against the respondents Russell John Cole, William Andrew Sim and RJ Cole and Partners Pty Ltd (collectively RJ Cole & Partners) claiming that they breached section 41 of the Workmen’s Compensation Act 1971 (SA) (the Act) by recovering costs in respect of proceedings under the Act in the absence of an order of the Court awarding those costs (the RJ Cole & Partners proceeding).
On RJ Cole & Partners’ strike out application, the Judge dismissed Mr Kowalski’s claim.[1] The Judge held that the Industrial Relations Court had no jurisdiction to entertain the claim; the claim was statute barred in any event; and the prosecution of the proceeding was an abuse of process having regard to Anshun principles and alternatively to the wider concept of abuse of process by relitigation.
[1] Kowalski v Cole & Others [2011] SAIRC 61.
On Mr Kowalski’s appeal, the Full Court changed the form of the Judge’s order from dismissal to a stay and otherwise dismissed the appeal.[2] The Full Court held that the Judge erred on the issues of jurisdiction and time limitation. The Full Court held that the proceeding was an abuse of process because it was brought for the improper purpose of harassing RJ Cole & Partners.
[2] Kowalski v Bourne and RJ Cole & Partners [2015] SAIRC 17.
Mr Kowalski appeals to this Court against the order of the Full Court. Section 47 of the Act confers a right of appeal to this Court from any order or decision of the Full Court of the Industrial Relations Court on a matter of law.[3]
[3] Kowalski v Cole & Ors; Kowalski v Bourne [2015] SASCFC 169 at [31]-[32] per Kourakis CJ, Blue and Nicholson JJ.
Mr Kowalski contends that the Full Court erred in holding that the proceeding was an abuse of process. RJ Cole & Partners, by notice of contention, argue that the Full Court erred in holding that the Industrial Relations Court had jurisdiction to entertain Mr Kowalski’s claim and that the claim was not statute-barred. RJ Cole & Partners seek permission to amend their notice of contention to include an additional contention that the Full Court erred in failing to hold that the RJ Cole & Partners proceeding was an abuse of process on the ground that the subject of that proceeding should have been raised by Mr Kowalski in previous proceedings.
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).
In July 2005, Master Lunn struck out RJ & Partners’ bill of costs for want of prosecution. In July 2007, Mr Kowalski filed an application in the taxation proceeding seeking an order under section 42 of the Legal Practitioners Act 1981 (SA) that RJ Cole & Partners refund monies to him as a result of their bill of costs having been struck out. In October 2007, Master Lunn dismissed the application as misconceived because there had been no taxation. In January 2008, Mr Kowalski filed an application in the taxation proceeding seeking to set aside Master Lunn’s order striking out RJ & Partners’ bill of costs. In March 2008, Master Lunn dismissed the application as misconceived.
In July 1996, Mr Kowalski filed a summons in the District Court against RJ Cole & Partners for damages for negligence in the conduct of his matters (the professional negligence action). In March 2002, Judge Anderson dismissed the action.
In 2008 and 2010, Mr Kowalski filed originating applications in the Federal Magistrates Court against RJ Cole & Partners for misleading and unconscionable conduct and related causes of action to recover monies appropriated to their costs. Mr Simpson FM and Mr Lindsay FM summarily dismissed the actions on the ground that Mr Kowalski was seeking to relitigate the matters determined in the professional negligence action and taxation proceeding. Mansfield J in the Federal Court refused leave to appeal against the first summary dismissal.
In March 2011, Mr Kowalski issued the RJ Cole & Partners proceeding in the Industrial Relations Court. At about the same time, he issued a similar proceeding against Mr Bourne seeking similar relief (the Bourne proceeding).
On 10 May 2011, RJ Cole & Partners filed an application to strike out the claim on the grounds that no reasonable cause of action was disclosed or it was brought out of time or it was an abuse of process as seeking to relitigate matters previously determined in earlier proceedings. Mr Bourne filed a similar application in the Bourne proceeding.
In June 2011, the Judge heard argument on the strike out application in the RJ Cole and Partners proceeding. At the conclusion of that argument, the Judge heard argument on the strike out application in the Bourne proceeding.
In August 2011, the Judge delivered reasons for judgment dismissing the summons in the RJ Cole & Partners proceeding.[5] The Judge made the same order for similar reasons in the Bourne proceeding.[6]
[5] Kowalski v Cole & Others [2011] SAIRC 61.
[6] Kowalski v Bourne [2011] SAIRC 62.
In August 2011, Mr Kowalski filed in the Industrial Relations Court a notice of appeal to the Full Court against the judgment of the Judge. Mr Kowalski also appealed against the judgment in the Bourne proceeding. In November 2014 and March 2015, the Full Court heard the two appeals together.
In May 2015, the Full Court delivered combined reasons for judgment in both proceedings.[7] The Full Court held that the Judge erred on the issues of jurisdiction and time limitation. The Full Court held that the RJ Cole & Partners and Bourne proceedings were an abuse of process because they were brought for the improper purpose of harassing RJ Cole & Partners and Mr Bourne.
[7] Kowalski v Bourne and RJ Cole & Partners [2015] SAIRC 17.
Legal costs charged by solicitors to clients
Before turning to the issues raised on appeal and by the notice of contention, it is desirable to consider the relationship between solicitors and clients and the control exercised by courts over that relationship and in particular over costs charged by solicitors to clients.
Under the general law and independently of the statute, a solicitor is an officer of the court.[8] As such, a solicitor owes various duties to the court independently of, and paramount to, the solicitor’s duties to his or her client.[9] As such, a solicitor is subject to the overriding supervision of the court.[10] This jurisdiction predated statutory regulation and the inherent jurisdiction of this Court over solicitors survives subject only to statutory exclusion. An example of supervision exercised by the court is the enforcement of undertakings given by solicitors.
[8] Myers v Elman [1940] AC 282 at 291 per Viscount Maugham, at 317 per Lord Wright and at 334 per Lord Porter.
[9] See for example Clyne v New South Wales Bar Association (1960) 104 CLR 186 at 200 per Dixon CJ, McTiernan, Fullagar, Menzies and Windeyer JJ (duty not to mislead the court); R v Turner [1970] 2 QB 321 at 326 per Lord Parker CJ (duty not to communicate privately with the judge); R v Dick [1982] Tas R 252 at 255 per Cosgrove J (duty to assist the court); Kooky Garments Ltd v Charlton [1994] 1 NZLR 587 at 590 per Thomas J (duty to be independent).
[10] Myers v Elman [1940] AC 282 at 335 per Lord Porter; Re a Solicitor [1960] VR 617 at 618 per Dean J; Re a Barrister & Solicitor (1979) 40 FLR 1 at 17.
Supervision is exercised by the court over solicitors in relation to costs charged to clients.[11] The jurisdiction is exercised because solicitors are officers of the court.[12] The court has inherent jurisdiction to examine the fairness and reasonableness of a costs agreement and set it aside if it is not fair and reasonable.[13] The rationale for the existence of this jurisdiction is that, due to the special relationship of confidence between solicitor and client, a presumption of undue influence arises and the onus lies on the solicitor to rebut it. In Clare v Joseph,[14] Fletcher Moulton LJ said:
[Under the general law] agreements between solicitor and his client as to the terms on which the solicitor’s business was to be done were not necessarily unenforceable. They were, however, viewed with great jealousy by the Courts, because they were agreements between a man and his legal adviser as to the terms of the latter’s remuneration, and there was so great an opportunity for the exercise of undue influence, that the Courts were very slow to enforce such agreements where they were favourable to the solicitor unless they were satisfied that they were made under circumstances that precluded any suspicion of an improper attempt on the solicitor’s part to benefit himself at his client’s expense.[15]
[11] Woolf v Snipe (1933) 48 CLR 677 at 678-679 per Dixon J; Re Feez Ruthning’s Bill of Costs [1989] 1 Qd R 55 at 82 per Macrossan J and 90 per McPherson J; Richfort Pty Ltd v Baluyut [1999] NTCCA 98; (1999) 9 NTLR 58 at [28] per Mildren J (with whom Gallop J agreed); 4WD Pty Ltd v McNamara [2009] SASC 274 at [19] per Anderson J.
[12] Re Feez Ruthning’s Bill of Costs [1989] 1 Qd R 55 at 82 per Macrossan J; Richfort Pty Ltd v Baluyut (1999) 9 NTLR 58 at [28] per Mildren J (with whom Gallop J agreed).
[13] Sanderson v Glass (1742) 2 Atk 296 at 298 per Lord Harwicke; Clare v Joseph [1907] 2 KB 369 at 376 per Fletcher Moulton LJ and 378 per Buckley LJ; Emeritus Pty Ltd v Mobbs (unreported, New South Wales Supreme Court, 27/6/1991, Studdert J BC9101842 at 12, 19); New South Wales Crime Commission v Fleming (1991) 24 NSWLR 116 at 123 per Gleeson CJ.
[14] [1907] 2 KB 369. This case was decided after the enactment of the Attorneys and Solicitors Act 1870 (UK) but the Court of Appeal held that the position was essentially the same under the inherent jurisdiction before its enactment.
[15] At 376.

The court has inherent jurisdiction, predating and independently of statute, to determine by taxation the amount payable by a client to a solicitor.[16] In Woolf v Snipe,[17] Dixon J said:
The superior Courts of law and equity possess a jurisdiction to ascertain, by taxation, moderation, or fixation, the costs, charges, and disbursements claimed by an attorney or solicitor from his client, and that jurisdiction is derived from three sources and falls under three corresponding heads.
First, a jurisdiction exists founded upon the relation to the Court of attorneys and solicitors considered as its officers. This jurisdiction, commonly called the general jurisdiction of the Court, enables it to regulate the charges made for work done by attorneys and solicitors of the Court in that capacity, and to prevent exorbitant demands. That such a jurisdiction was exercised by the Court of Chancery was never doubted... The Courts of law appear to have exercised a like jurisdiction, … but the existence of the authority was disputed by the Court of King's Bench in Dagley v Kentish, and for a few years it fell into disuse... After the Judicature Act the existence of the Court's general jurisdiction was completely established.[18]
[16] Storer & Co v Johnson (1890) 15 App Cas 203 at 206 per Lord Halsbury; Woolf v Snipe (1933) 48 CLR 677 at 678-679 per Dixon J.
[17] (1933) 48 CLR 677.
[18] At 678-679. [citations omitted]
In Electrical Trades Union v Tarlo,[19] Wilberforce J said:
I think it is undisputed that section 50 of the Solicitors Act, 1957, has not taken away the general jurisdiction with which the court has always possessed over solicitors as officers of the court, and… the court has inherent jurisdiction to secure that the solicitor, as an officer of the court, is remunerated properly, and no more, for work he does as a solicitor.[20]
[19] [1964] Ch 720.
[20] At 734.
In Re P’s Bill of Costs,[21] Evatt CJ and Fogarty J held that, subject to statute excluding the jurisdiction or covering the field, the Family Court has jurisdiction over costs charged by solicitors to clients for work undertaken in the Family Court, saying:
Although the Family Court is a creature of statute it is a Court of Record and has inherent powers in appropriate circumstances. Those are powers which arise as a necessary adjunct to the existence of the court itself, and such as are necessary to control and regulate the proceedings before it and to avoid injustice …
Specifically here the power of such a court to regulate by its rules and orders costs to be charged by a practitioner practising in that court is of long standing: see Woolf v Snipe, supra, and the cases therein referred to. It is seen as a necessary part for the court’s inherent power to control its own processes and, as part of that power, to determine any dispute of fact or law necessary for that purpose.[22]
[21] (1982) 45 ALR 513.
[22] At 519-520 per Evatt CJ and Fogarty J.
It is an incident of the jurisdiction of the court over costs charged by solicitors to clients that the court can order repayment by a solicitor of an amount overcharged to and paid by a client.[23] Where the jurisdiction to tax costs is statutory, the statute may impose a time limit for applications to tax costs.[24] Otherwise, there is no time limit.[25] For example, there was no time limit until 2014[26] for applications to tax costs under section 42 of the Legal Practitioners Act 1981 (SA).[27]
[23] Harrison v Tew [1990] 1 All ER 321 at 330 per Lord Lowry (with whom Lord Ackner, Lord Oliver of Aylmerton and Lord Jauncy of Tullichettle agreed).
[24] See, eg, Solicitors Act 1957 (UK) section 69(2)(iii).
[25] See, eg, In re A Solicitor [1961] 1 Ch 491 at 501 per Cross J.
[26] The Legal Practitioners (Miscellaneous) Amendment Act 2013 (SA) repealed section 42 and enacted Schedule 3 Part 7 in its place. Paragraph 37(4) of that schedule now imposes a time limit for an application for adjudication by a client.
[27] DA Starke Pty Ltd v Yardoo Pty Ltd [2009] SASC 90, (2009) 262 LSJS 248 at [19] per Judge Withers; Kowalski v Stanley & Partners [2014] SASC 198 at [19] per Judge Dart.
It is desirable to determine first RJ Cole & Partners’ contentions that the Full Court erred in holding that the Industrial Relations Court had jurisdiction to entertain Mr Kowalski’s claim and erred in holding that it was not statute-barred.
Jurisdiction
Section 41 of the Act provides:
41.     Costs
(1)Subject to subsection (1a) of this section, in any proceedings under this Act the Court may award costs against any party thereto or order that such costs be taxed by the Court which may be constituted by an industrial magistrate upon the scale fixed by the Rules of Court.
(1a)   The Court shall not order or award, against a workman who is a party to any proceedings under this Act, the costs of another party unless it is satisfied that in relation to those proceedings some special reason exists why it is proper that those costs be so ordered or awarded.
(1b)   Where it appears to the Court that costs to a party have been improperly or without reasonable cause incurred by reason of the misconduct or default of a legal practitioner the Court may call on the legal practitioner to show cause why those costs should not be paid by the legal practitioner personally or, as the case requires, be repaid by the legal practitioner to the party incurring them and thereupon the Court may make such order as the justice of the case may require.
(2)No legal practitioner acting for a workman shall be entitled to recover from that worker any costs in respect of any proceedings under this Act or to claim a lien in respect of such costs on or to deduct such costs from any sum awarded as compensation unless those costs have been awarded by the Court.
(3)No agreement by a person claiming compensation to pay any amount by way of costs greater than the amount awarded by the Court shall be binding on that person and any amount paid by that person by way of costs in excess of the amount so awarded shall be recoverable by that person as a debt due to him.
(4)In this section “proceedings under this Act” includes any matter or thing relating to the preparation of an agreement referred to in Division III of Part III of this Act and any other matter or thing whether or not of the same kind as the foregoing prescribed by the Rules of Court.
Subsections (2) and (3) in conjunction effectively provide that ordinarily a solicitor for a worker is to recover costs for work in respect of proceedings under the Act from the worker’s employer on the scale fixed by Rules of Court pursuant to an award of costs by the Court, unless and except to the extent that the Court authorises the payment by the worker of costs to his or her solicitor in an amount fixed by the Court or taxed by the Court upon the scale fixed by the Rules of Court.
The evident purpose of subsections 41(2) and (3) is that a worker will only be ordered to pay his or her solicitor’s costs out of his or her own pocket if there is a special reason for making such an order. It is possible to envisage various circumstances in which there might be good reason to make such an order. They include when a proceeding is brought against the advice of the solicitor and proves unsuccessful; when the employer/employer’s insurer becomes insolvent; or when a proceeding is settled on the basis of the employer paying an undissected lump sum inclusive of costs.
Section 21 of the Act provides:
The Industrial Court of South Australia shall have jurisdiction to hear and determine any question or dispute concerning any matter or thing arising out of or connected with the liability to pay, or the amount of compensation under this Act and all matters and things ancillary thereto.
Section 130 of the Act provides:
The power to make rules under section 175 of the Industrial Conciliation and Arbitration Act 1972, as amended from time to time, shall include power to make Rules of Court, notwithstanding that those Rules of Court may be inconsistent with that Act for any purpose for which this Act authorizes Rules of Court (not being rules of the Supreme Court) to be made and also for generally regulating the practice of the Court, the practice of the Full Industrial Court generally and in relation to appeals and officers of the Court, and for carrying into effect this Act so far as it relates to or affects the Court or officers of the Court and such rules may also prescribe such forms and scales of fees, costs and expenses as may be necessary or convenient for the purposes of this Act.
Rule 122 of the Workers Compensation Rules 1980 (SA) (the Rules) provides:
Costs may be awarded as between a legal practitioner and his client pursuant to subsection (2) of section 41 of the Act by order made either upon oral application at a hearing of a proceeding or on an application in the general form to be served on the worker in such manner as the judge shall direct. The provisions of this Part of these rules shall apply mutatis mutandis to any such order or a taxation in pursuance thereof except that costs shall be allowed upon the “solicitor and client” basis.
Notwithstanding the foregoing provisions of this rule, if a legal practitioner and his client shall agree in writing upon lump sum for costs prior to the taxation of a bill of costs they may lodge such agreement with the Taxing Officer who may, if he is satisfied after due investigation of the circumstances that the said agreement is just and proper, allow the legal practitioner’s costs in the agreed sum. Such investigation as aforesaid shall constitute a “proceeding” before the Taxing Officer within the meaning of paragraph (c) of rule 126.
Subrule 120(1) of the Rules provides that generally costs of any proceeding under the Act shall be in the discretion of the Court. Subrule 123(1) provides that the Court may either assess a lump sum allowance for costs or direct that costs be taxed by a Taxing Officer in accordance with the itemised scale of costs set forth in Appendix 2. Rule 125 contains a set of rules applying on a taxation of costs unless the Court otherwise directs, rule 126 sets out procedures for taxations and rule 127 confers a right of review in respect of any decision of the Taxing Officer.
Reasoning of the Judge
The Judge referred to the decisions of this Court in Adelaide Assemblers Ltd v Kutos and Freeway Motors Ltd[28] and The Queen v Industrial Court of South Australia; Ex parte General Motors-Holden Pty Ltd.[29] The Judge held that those decisions established that the jurisdiction of the Industrial Court under the Act is primarily concerned with issues relating to compensation as between workers and employers and, in the absence of express provisions, it is not the intention of the Act to confer on the Court common law or equitable jurisdiction of a quite different nature.
[28] (1974) 9 SASR 102.
[29] (1975) 10 SASR 582.
The Judge accepted that issues concerning costs in respect of a claim for compensation could be taken to be ancillary to the Court’s principal jurisdiction within the meaning of section 21. However, the Judge held that, considering each subsection in turn, it was not the evident intention or effect of subsections 41(2) or 41(3) to confer on the Court power to make orders as between worker and solicitor relating to the repayment of costs improperly recovered.
Reasoning of the Full Court
The Full Court considered that the Judge’s reliance on the decision of this Court in Adelaide Assemblers Ltd was misplaced because it dealt with a substantially different issue to that arising in the present case. The Full Court held that there was nothing preventing RJ Cole & Partners from making an application under subrule 122(1) for an order that Mr Kowalski pay the costs in respect of proceedings under the Act. The Full Court concluded:
In our view the Court had jurisdiction to hear the appellant’s claim under ss 21 and 41 of the WCA because the issue of the application of s 41 to the costs as between him and Stanley and Partners and RJ Cole was a matter or thing ancillary to the questions and disputes between the appellant and Mitsubishi within the meaning of s 21 of the WCA. Because the Court had power to make an order as to costs as between legal practitioner and client under rule 122(1) of the Rules the combination of that rule and s 41 of the WCA gave the Court a supervisory jurisdiction over costs as between solicitor and client.
Analysis
On the appeal to this Court, RJ Cole & Partners effectively adopt the reasoning of the Judge and contend that the Full Court erred. Mr Kowalski contends that the Full Court was correct.
Section 21 of the Act confers on the Court a primary jurisdiction and an ancillary jurisdiction. The primary jurisdiction relates to matters arising out of or connected with liability and quantum of compensation payable under the Act. The ancillary jurisdiction relates to all matters and things ancillary to compensation payable under the Act. What is ancillary is to be determined as a matter of statutory construction having regard to the provisions of the Act as a whole and their evident purpose.
The subject matter of section 41 is matters ancillary to compensation, namely legal costs, but it addresses not only costs as between party and party but also costs as between worker and solicitor. Section 41 vests a supervisory jurisdiction in the Industrial Relations Court over costs charged by solicitors to workers for work in respect of proceedings under the Act. It does not expressly confer jurisdiction on the Court to order that costs be or not be payable by a worker to a solicitor, fix the amount of such costs or tax such costs but such jurisdiction is clearly conferred as a matter of necessary intendment. It is inherent in the conferral of that jurisdiction that the Court has consequential power to order payment by the worker to the solicitor of the amount unpaid of any costs awarded in favour of the solicitor or to order payment by the solicitor to the worker of any amount recovered by the solicitor from the worker in excess of the amount (if any) authorised by the Court under the section.
A solicitor who has acted for a worker in respect of proceedings under the Act is entitled under rule 122 to apply for an order that costs be payable by the worker to the solicitor and for the fixing or taxation of such costs. It is the clear intent of section 41 and the Rules that a worker is also entitled to make an application in respect of costs charged by his or her solicitor.
As a matter of statutory construction, the Industrial Relations Court has jurisdiction over costs as between worker and solicitor in respect of proceedings under the Act. The Court has power to order that costs be payable or not payable by a worker to a solicitor, to fix or tax such costs, and to order the payment by the worker to the solicitor, or the solicitor to the worker, of an amount accordingly. The jurisdiction of the Industrial Relations Court is of the same nature as the jurisdiction of this Court over solicitors’ costs, except that this Court’s jurisdiction is general while the Industrial Relations Court’s jurisdiction is confined to costs in respect of proceedings under the Act. The Industrial Relations Court’s power to order a refund of costs paid after a taxation under section 41 of the Act is incidental to the taxation in the same way as an order for a refund of costs paid after an adjudication of costs in this Court is incidental to the adjudication.
In Adelaide Assemblers Ltd v Kutos and Freeway Motors Ltd,[30] Kutos had worked successively for Adelaide Assemblers and for Freeway Motors. The Full Industrial Court held that he was entitled to payment of workers compensation at $65 per week and each of Adelaide Assemblers and Freeway Motors had a liability to pay this amount to him (but he was not entitled to double payment). Each employer filed a purported contribution notice against the other claiming contribution in equity or at common law for co-ordinate liabilities. This Court held that the Industrial Court lacked equitable or common law jurisdiction to order contribution. Hogarth ACJ, Bright and Walters JJ said:
In our view, the absence of any reference anywhere in the Act to questions as between one employer and another (except in the case of successive employers of a man suffering from injury arising out of industrial disease such as we have already referred to) suggests strongly to us that Parliament did not have in mind that jurisdiction of this nature would be exercised by the Industrial Court. To read the Act otherwise would be to introduce a limited jurisdiction in common law and equity, a jurisdiction of an entirely different nature from the statutory jurisdiction already exercised by that Court.[31]
[30] (1974) 9 SASR 102.
[31] At 107-108.
The reasoning in Adelaide Assemblers Ltd does not apply to the jurisdiction of the Industrial Relations Court in relation to costs charged by solicitors to workers because section 41 makes it clear that such costs are ancillary to compensation within the meaning and for the purposes of section 21.
In The Queen v Industrial Court of South Australia; Ex parte General Motors-Holdens Pty Ltd,[32] this Court considered section 15(1)(e) of the Industrial Conciliation and Arbitration Act 1972 (SA). That provision conferred on the Industrial Court jurisdiction to hear and determine whether a dismissal of an employee was harsh, unjust or unreasonable, and to direct the employer to re-employ the employee and order the payment of wages between dismissal and re-employment. Walters and Wells JJ (Bray CJ dissenting) held that as a matter of statutory construction the provision conferred a single jurisdiction to order reinstatement and interim wages and did not confer jurisdiction to make a declaration that the dismissal was harsh, unjust or unreasonable without ordering reinstatement. Walters and Wells JJ said that there was no hint in the legislation of an intention to confer power on the Industrial Court to give declaratory judgments in the absence of substantive relief (such power being equitable in origin).
[32] (1975) 10 SASR 582.
The reasoning of this Court in Ex parte General Motors-Holdens Pty Ltd does not apply to the jurisdiction of the Industrial Relations Court in relation to costs charged by solicitors to workers because section 41 clearly confers jurisdiction on that Court in respect of those costs.
The Full Court was correct in holding that the Industrial Relations Court had power to entertain Mr Kowalski’s claim.
Time limitation
Section 38 of the Limitation of Actions Act 1936 (SA) provides that an action for the recovery of money based on restitutionary grounds must be commenced within six years after the cause of action arose. Section 35(c) provides that actions founded on tort shall, save as otherwise provided in that Act, be commenced within six years next after the cause of action accrued and not after.
The Judge held that, if Mr Kowalski had a claim within the jurisdiction of the Industrial Relations Court for recovery of costs consequent on a proven breach of subsection 41(2) of the Act, it would be properly characterised as an action founded on the tort of breach of statutory duty or for the recovery of money based on restitutionary grounds and a six year limitation period would apply. The Judge held that such causes of action would have accrued in September 1992 when RJ Cole & Partners transferred monies from their trust account in payment of their accounts. The Judge held that Mr Kowalski’s claim was therefore statute barred.
The Full Court held that the Judge erred in reaching this conclusion. The Full Court said:
Our difficulty with that approach is that it fails to recognise that the right of a worker to recover costs pursuant to s 41 of the WCA is not a claim based on restitution or breach of statutory duty. It is a claim based upon a statutory jurisdiction given to this Court to supervise claims for costs by legal practitioners practising in the jurisdiction conferred by the WCA.

On the appeal to this Court, RJ Cole & Partners effectively adopt the reasoning of the Judge and contend that the Full Court erred. Mr Kowalski contends that the Full Court was correct.
The jurisdiction exercised by the Industrial Relations Court over solicitors in relation to costs charged by them to workers in respect of proceedings under the Act is a supervisory jurisdiction within a limited field. The power of the Industrial Relations Court is an incident of that jurisdiction and in particular of the power of that Court to control costs charged by solicitors to workers in respect of proceedings under the Act. That power does not involve a common law or equitable cause of action whether in tort, restitution or otherwise. The position is the same as in respect of an order by this Court for a refund of costs after an adjudication: that order is incidental to the adjudication; it is not a judgment on a cause of action for breach of statutory duty or for restitution.
Sections 35 and 38 of the Limitation of Actions Act 1936 (SA) have no application to the RJ Cole & Partners proceeding instituted by Mr Kowalski in the Industrial Relations Court.
The Full Court was correct in holding that the proceeding was not statute barred.
Abuse of process
RJ Cole & Partners’ strike out application was supported by an affidavit by Mr Sim in which he identified the grounds of the application and exhibited the evidence upon which they relied. In relation to the abuse of process ground, Mr Sim said that RJ Cole & Partners submitted that Mr Kowalski was seeking in the proceeding to revisit matters which had been previously determined:
1.by Judge Anderson in March 2002 when dismissing the professional negligence action;
2.by Master Lunn in October 2007 when dismissing Mr Kowalski’s application for a refund in the taxation proceeding; and/or
3.by Master Lunn in March 2008 when dismissing Mr Kowalski’s application to reinstate the taxation proceeding.
Mr Sim exhibited the reasons for judgment of Judge Anderson and Master Lunn relied upon. He also exhibited the reasons for judgment of Mr Simpson FM, Mr Lindsay FM and Mansfield J in the federal proceedings by way of background.
Courts generally possess inherent or implied power to stay proceedings before them on the ground of abuse of process.[33]
[33] Jago v District Court(NSW) (1989) 168 CLR 23 at 28-30 per Mason CJ, 57-58 per Deane J and 74-77 per Gaudron J; Walton v Gardiner (1993) 177 CLR 378 at 392-393 per Mason CJ, Deane and Dawson JJ. In the case of superior courts (or courts of traditional or general jurisdiction), the power is often described as inherent and in the case of inferior courts (or courts of limited jurisdiction), the power is often described as implied. Nothing turns on whether it is inherent or implied in the present case.
There are several established categories of abuse of process in respect of civil proceedings, including:
1.a proceeding brought for an improper purpose;[34]
2.a proceeding brought without reasonable grounds;[35]
3.a proceeding brought in a clearly inappropriate forum;[36]
4.a proceeding unjustifiably duplicating one pending in another forum causing oppression or injustice;[37]
5.a proceeding unjustifiably seeking to litigate anew a case already disposed of by an earlier proceeding causing oppression and vexation.[38]
[34] Williams v Spautz (1992) 174 CLR 509 at 529 per Mason CJ, Dawson, Toohey and McHugh JJ.
[35] Walton v Gardiner (1993) 177 CLR 378 at 393 per Mason CJ, Deane and Dawson JJ; Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27, (2006) 226 CLR 256 at [10] per Gleeson CJ, Gummow, Hayne and Crennan JJ quoting Metropolitan Bank Ltd v Pooley (1885) 10 App Cas 210 att 80 per Lord Blackburn.
[36] Walton v Gardiner (1993) 177 CLR 378 at 393 per Mason CJ, Deane and Dawson JJ.
[37] See, for example, Voth v Manildra Flower Mills Pty Ltd (1990) 171 CLR 538 at 552-566 per Mason CJ, Deane, Dawson and Gaudron JJ; Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256 at [9]-[15] per Gleeson CJ, Gummow, Hayne and Crennan JJ.
[38] Walton v Gardiner (1993) 177 CLR 378 at 393 per Mason CJ, Deane and Dawson JJ.
The category of abuse of process invoked by RJ Cole & Partners in their strike out application was the fifth category, namely that Mr Kowalski was unjustifiably seeking to litigate anew a case already disposed of by judgment in earlier proceedings causing oppression and vexation (the relitigation ground). RJ Cole & Partners relied on the judgment of Judge Anderson in the professional negligence action and the judgments of Master Lunn in the taxation proceeding.
Reasoning of the Judge
The Judge referred to the principles applied to determine whether a proceeding is an abuse of process on the relitigation ground. The Judge said:
Proceedings may constitute an abuse of process by relitigation in different ways. The invocation of the procedures of the Court to relitigate controversies already decided by a court may be prevented by the application of doctrines of res judicata or issue estoppel. The scope of these doctrines is confined. The first will apply only where a court with relevant jurisdiction has given judgment already on the cause of action raised in the later litigation; the second where a party, for the purpose of a claim, alleges or denies the existence of facts which have necessarily been decided by a prior judgment. The application of these doctrines has been extended to prevent the pursuit of issues or claims which ought reasonably to have been litigated in the course of earlier proceedings between the parties in accordance with Anshun principles.
The Court’s jurisdiction to protect a party from an abuse of process involving an attempt to relitigate a claim already disposed of is not limited to cases where the technical requirements of the above doctrines and the Anshun extension can be made out.
The Judge referred to authorities on abuse of process on the relitigation ground, namely State Bank of New South Wales v Stenhouse Ltd,[39] Spalla v St George Motor Finance Ltd (No 6)[40] and McDonald v The State of South Australia.[41]
[39] (1997) Aust Torts Reports 81-423.
[40] [2004] FCA 1699.
[41] [2011] FCA 297.
The Judge said:
Regard must be had to the public policy underlying these doctrines, including that there is a general public interest in preventing a party to proceedings being subjected to unfairness or oppression through having the same issue litigated again, in maintaining of confidence in and respect for the authority of the courts, and in avoiding a waste of judicial resources on unmeritorious claims.
The Judge rejected a contention by RJ Cole & Partners that the proceeding was barred by res judicata arising from Judge Anderson’s decision. The Judge said:
I do not consider that a cause of action estoppel arises. The proceedings now before the Court are not founded on general allegations of negligence or breach of contract. Whilst general allegations of tortious conduct are made, the claim also relies upon an alleged breach by the respondents of a statutory constraint upon their entitlement to recover costs of proceedings under the WCA. That was not a matter before Judge Anderson, and his decision to dismiss the negligence/breach of contract claim does not provide grounds for the application of either res judicata or issue estoppel.
The Judge held nevertheless that the proceedings were barred by Anshun estoppel. The Judge said:
Given the specific complaint made in those proceedings that the respondents were, for various reasons, not entitled to any recovery of costs, it was unreasonable of the applicant not to include for the consideration of the Judge the complaints he now makes that the respondents were not entitled to their costs due to unconscionable conduct, fraud, illegality and breach of s 41 of the WCA. That is, given the same underlying basis for the complaints as to the conduct of the respondents with respect to recovery of costs then and now made, the applicant could reasonably have been expected to have raised the alleged breach of s 41 of the WCA in the District Court proceedings.
The Judge held in the alternative that the conduct and maintenance of the proceeding was an abuse of process on the relitigation ground. The Judge considered the history of the proceedings instituted by Mr Kowalski and concluded:
The present proceedings constitute the applicant’s fourth attempt since the dismissal of the negligence proceedings to relitigate the issue as to the respondents’ entitlement to costs by the application of fresh labels to the same underlying claims. It is quite apparent that s 41 of the WCA has been adopted as yet another means of raising the longstanding complaints of unconscionable conduct, duress and fraud. The use of this device does not allow the applicant to avoid the adoption of the approach outlined in Spalla and McDonald to these proceedings.
I refer to the factors mentioned above by Giles CJ in Stenhouse. The issue now raised in these proceedings, whilst one of many in the negligence claim, was nevertheless an important one in the context of the many allegations of negligence/breach of contract. The applicant had the opportunity to fully litigate the costs issue and to raise any matters, including the application of s 41(2) of the WCA, which might have disentitled the respondents to their costs. A final decision was made on the issue of the respondent’s entitlement to costs. There was no appeal. There is no plea of fresh evidence in these proceedings.
The above matters require that regard be had to the public policy considerations underlying the power of the Court to protect its processes from abuse. These considerations, together with the overall history of other unmeritorious litigation on the same underlying issue of costs, lead me to conclude that it will be oppressive and unfair to the respondents if the summons now brought by the applicant is allowed to proceed.
Reasoning of the Full Court
The Full Court took a different approach. The Full Court delivered one set of reasons encompassing both appeals by Mr Kowalski in the RJ Cole & Partners and Bourne proceedings.
The Full Court did not uphold the Judge’s conclusion that the proceeding was barred by the Anshun principle or was an abuse of process on the relitigation ground. The Full Court referred to the decision of Forrest J in Attorney-General v Knight[42] in relation to proceedings being vexatious on the improper purpose ground. The Full Court concluded that the proceeding was brought for an improper purpose, being the first category referred to at [60] above.
[42] [2014] VSC 549.
The Full Court observed that section 41 of the Act applies only to a relatively small proportion of the costs charged by RJ Cole & Partners; an order may have been made for payment of such costs if RJ Cole & Partners had applied for an order; RJ Cole & Partners may have overlooked the need to do so and the costs were incurred many years before Mr Kowalski’s application was made.
The core of the Full Court’s reasoning for concluding that the proceeding was instituted for an improper purpose was in the following passage:
In Attorney-General v Knight Forrest J sets out the various categories of vexatious litigation He said:
“In Attorney-General v Wentworth, Roden J considered vexatious proceedings to divide into three, general, categories:
It seems then that litigation may properly be regarded as vexatious for present purposes on either objective or subjective grounds. I believe that the test may be expressed in the following terms:
(1)     they are instituted with the intention of annoying or embarrassing the person against whom they are brought; or
(2)     they are brought for collateral purposes, and not for the purpose of having the court adjudicate on the issues to which they give rise; or
(3)     irrespective of the motive of the litigant, they are so obviously untenable or manifestly groundless as to be utterly hopeless.
Although the ultimate question is not whether the proceeding has been instituted or conducted vexatiously, the way a proceeding is conducted may tend to prove that its nature and substance is vexatious. In my view, this is more likely to be the case where the proceeding falls into the first or second of Roden J’s categories because those categories are concerned with the intentions or purposes that lie behind the litigation.”
(footnotes omitted; emphasis ours)
Throughout his submissions on appeal the appellant has continued to assert that … Mr Bourne and RJ Cole committed fraud. He described Mr Bourne as a wrongdoer and a criminal. He described Mr Bourne and counsel for RJ Cole as pathological liars. He said of Mr Bourne: “Now, he’s sitting on the Parole Board deciding whether criminals get out of gaol. He’s one of the biggest criminals I’ve been involved in.” He said that RJ Cole had “acted illegally, corruptly, fraudulently”.
Like the learned judge we conclude that having regard to the way in which the appellant has conducted this appeal demonstrates that he has a much wider objective. These proceedings have very little to do with money and very much to do with annoying, insulting and embarrassing Mr Bourne and RJ Cole.
Like Kourakis J in Kowalski v Bourne it appears to us from the history of litigation between the appellant and Mr Bourne and the content of the appellant’s submissions that Mr Kowalski bears a great personal animosity towards Mr Bourne. For the same reasons is also appears that the appellant bears a great personal animosity towards RJ Cole. It appears that the appellant is anxious to bring proceedings to harass them in any jurisdiction in which it is possible to do so. In our view the irresistible inference to be drawn is that the proceedings were instituted for that purpose.
Error by the Full Court
Mr Kowalski contends that the Full Court erred in law in concluding that the proceeding was brought for the improper purpose of harassing RJ Cole & Partners.
Section 47 of the Act confers a right of appeal to the Full Court from any order or decision of the Court. Such an appeal is by way of rehearing. Normally such appeals are heard on the evidence adduced at first instance and, although the appeal court has discretion to admit new evidence on appeal, that course is unusual. In this case, RJ Cole & Partners did not seek to adduce any new evidence on appeal and the Full Court did not admit any new evidence. Although the Full Court has a discretion to permit a party to raise a new argument on appeal not raised in the Court below, that course is unusual.
RJ Cole & Partners did not invoke the improper purpose ground in their strike out application filed in May 2011. Insofar as that application relied on abuse of process, it invoked only the relitigation ground. The Judge upheld the abuse of process contention on the basis of the relitigation ground.
If the Full Court contemplated making a finding that the proceeding was instituted for the improper purpose of harassing RJ Cole & Partners, procedural fairness required that Mr Kowalski be informed thereof and given an opportunity to adduce evidence and make submissions in relation thereto. If the Full Court contemplated relying on Mr Kowalski’s own conduct during the hearing of the appeal as evidence that his purpose was to harass RJ Cole & Partners, procedural fairness required that he be informed thereof and given an opportunity to adduce evidence and make submissions in relation thereto. If the Full Court contemplated making a finding that the Bourne proceeding was instituted for the improper purpose of harassing Mr Bourne and using that finding in turn to find an improper purpose in respect of RJ Cole & Partners, procedural fairness required that Mr Kowalski be informed thereof and given an opportunity to adduce evidence and make submissions in relation thereto.[43] This did not occur.
[43] The Full Court appears to have relied upon Mr Kowalski's conduct in relation to Mr Bourne and its finding that Mr Kowalski's purpose was to harass Mr Bourne as evidence of his purpose in bringing the RJ Cole & Partners proceeding or alternatively to have made a composite finding of harassment of both RJ Cole & Partners and Mr Bourne. The question whether Mr Kowalski's conduct in relation to Mr Bourne was admissible or could be relied upon on the question of his motivation in bringing the RJ Cole & Partners proceeding was not explored with the parties or considered by the Full Court because of the manner in which the Full Court dealt with the matter. Before relying on Mr Kowalski's conduct in relation to Mr Bourne in making a finding on Mr Kowalski's motivation in bringing the RJ Cole & Partners proceeding, procedural fairness required that Mr Kowalski be informed thereof and given an opportunity to oppose this, to adduce evidence and to make submissions in relation thereto.
The Full Court made an error of law by not affording procedural fairness to Mr Kowalski before finding that the proceeding was instituted for the improper purpose of harassing RJ Cole & Partners. Subject to consideration of RJ Cole & Partners’ application for permission to amend their notice of contention, the appeal must be allowed and the orders of the Full Court set aside.
Application for permission to amend the notice of contention
RJ Cole & Partners seek permission to amend their notice of contention to include an additional contention that the Full Court erred in failing to hold that the proceeding was an abuse of process on the ground that the subject of the proceeding should have been raised by Mr Kowalski in previous proceedings. Mr Kowalski opposes permission to amend.
RJ Cole & Partners contend that Mr Kowalski was precluded from bringing the proceeding by Anshun estoppel or in the alternative his bringing of the proceeding was an abuse of process on the relitigation ground. These issues were advanced by RJ Cole & Partners before the Judge and they were successful at first instance on these issues. No prejudice is occasioned to Mr Kowalski by permitting RJ Cole & Partners to amend their notice of contention to raise these issues out of time. Permission to amend the notice of contention should be granted.
Anshun estoppel
RJ Cole & Partners contend that the Full Court erred in failing to hold that the proceeding was precluded by Anshun estoppel.
In a passage approved by the High Court in Port of Melbourne Authority v Anshun Pty Ltd,[44] this principle was stated by Sir James Wigram VC in Henderson v Henderson[45] in the following terms:
[W]here a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.[46]
[44] (1981) 147 CLR 589 at 598 per Gibbs CJ, Mason and Aickin JJ.
[45] (1843) 3 Hare 100 (67 ER 313).
[46] (1843) 3 Hare 100 at 115 (67 ER 313 at 319).
In a passage approved by the High Court in Port of Melbourne Authority v Anshun Pty Ltd,[47] this principle was stated by Somervell LJ in Greenhalgh v Mallard[48] in the following terms:
I think that on the authorities to which I will refer it would be accurate to say that res judicata for this purpose is not confined to the issues which the court is actually asked to decide, but that it covers issues or facts which are so clearly part of the subject-matter of the litigation and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be started in respect of them.[49]
[47] (1981) 147 CLR 589 at 602 per Gibbs CJ, Mason and Aickin JJ.
[48] [1947] 2 All ER 255.
[49] At 257.

RJ Cole & Partners’ principal contention is that Mr Kowalski’s claim under section 41 of the Act is so closely connected to the claims he made in the professional negligence action and forms part of the same subject matter such that it was unreasonable for him not to bring forward that claim as part of the professional negligence proceeding and he is now precluded from doing so in the RJ Cole & Partners proceeding. In effect, RJ Cole & Partners adopt the reasoning of the Judge extracted at [66] above.
Judge Anderson’s reasons for judgment in the professional negligence action show that the action was exclusively for damages for negligence in the conduct of Mr Kowalski’s actions. Mr Kowalski essentially alleged that RJ Cole & Partners:
1.negligently failed to pursue section 43 workers compensation entitlements that would have produced the same amount for non-economic loss as the back injury action without having to prove negligence and without the costs and risks incurred in a common law action;
2.negligently conducted his back injury action which led to its dismissal by Judge Lee and consequential loss;
3.negligently advised him not to appeal against the dismissal;
4.negligently conducted his eye injury claims including in dealing with Stanley & Partners over their file and costs;
5.negligently conducted settlement negotiations and arrangements with Mitsubishi in mid-1992 including negligently accounting to him for the $23,000 settlement funds received from Mitsubishi.
Judge Anderson’s reasons for judgment in the professional negligence action show that the subject of the action was not the amount of costs payable by Mr Kowalski to RJ Cole & Partners for work undertaken by them on his various matters.
Judge Anderson referred to the taxation proceeding in the Supreme Court and observed that, where there may be debate whether costs orders made in favour of Mitsubishi ought to be met by Mr Kowalski or RJ Cole & Partners, that was a matter for resolution in the taxation proceeding and no part of the professional negligence action.
Judge Anderson referred to submissions by Mr Kowalski complaining about RJ Cole & Partners’ use of the settlement sum of $23,000, in the course of which Judge Anderson observed that they had an equitable lien over that sum for their costs. However, this observation was made by Judge Anderson leading to a conclusion that “no negligent behaviour by RJ Cole & Partners has been shown to have occurred in relation to their accounting to Mr Kowalski for funds received on his account”. This observation related to a cause of action in negligence rather than to ascertaining amounts properly payable by Mr Kowalski to RJ Cole & Partners for costs.
Courts in professional negligence actions typically eschew costs issues, leaving them to be addressed in taxation proceedings. Court in taxation proceedings typically eschew negligence issues, leaving them to be determined in professional negligence actions. Judge Anderson acted in accordance with this convention.
Given the nature of the professional negligence action, there was no evidence and no basis on which any conclusion could be made by the Judge that a claim under section 41 of the Act in relation to costs of proceedings under the Act had any connection with the professional negligence action such that an Anshun estoppel was capable of arising. Indeed, if Mr Kowalski had sought to raise any such claim in that action, it is evident that Judge Anderson would have declined to entertain it.
RJ Cole & Partners make a secondary contention that Mr Kowalski’s claim under section 41 of the Act is so closely connected to the two applications that he made in the taxation proceeding, and forms part of the same subject matter, such that it was unreasonable for him not to bring forward that claim as part of those applications and he is now precluded from doing so in the RJ Cole & Partners proceeding.
The taxation proceeding itself was instituted by RJ Cole & Partners and not Mr Kowalski. The first application made by Mr Kowalski was for a refund of costs paid consequential on the striking out of RJ Cole & Partners’ bill of costs for want of prosecution. As Master Lunn held that this application was misconceived, Mr Kowalski could not have joined any other claim with this application. The second application made by Mr Kowalski was to reinstate the taxation. As Master Lunn held that this application was misconceived, Mr Kowalski could not have joined any other claim with this application.
Anshun estoppel was incapable as a matter of law of precluding Mr Kowalski from bringing the RJ Cole & Partners proceeding in the Industrial Relations Court.
Abuse of process on relitigation ground
RJ Cole & Partners contend that the Full Court erred in failing to hold that the proceeding was an abuse of process on the ground that the subject of the proceeding should have been raised by Mr Kowalski in previous proceedings, namely the professional negligence action heard by Judge Anderson and the two applications in the taxation proceeding heard by Master Lunn.
As noted above, one recognised category of abuse of process is the institution and prosecution of a proceeding unjustifiably seeking to litigate anew a case already disposed of by an earlier proceeding causing oppression and vexation. Typically this category will be invoked when one of the strict requirements for res judicata, issue estoppel or Anshun estoppel is not satisfied but the underlying rationale for its application applies notwithstanding the absence of that requirement. Examples are cases where there is not a strict identity of parties between the new and old proceedings[50] or where the proceedings are interlocutory in nature.[51]
[50] State Bank of New South Wales Ltd v Stenhouse Ltd (1997) Aust Torts Rep 81-423.
[51] Wentworth v Graham [2003] NSWCA 307.
In State Bank of New South Wales Ltd v Stenhouse Ltd,[52] Giles CJ reviewed previous authorities considering whether there was an abuse of process where a party sought to relitigate an issue decided between that party and a third party. Giles CJ identified the following matters relevant to determining whether a proceeding is an abuse of process on the relitigation ground:
[52] (1997) Aust Torts Rep 81-423.
(a)the importance of the issue in and to the earlier proceedings, including whether it is an evidentiary issue or an ultimate issue;
(b)     the opportunity available and taken to fully litigate the issue;
(c)     the terms and finality of the finding as to the issue;
(d)     the identity between the relevant issues in the two proceedings;
(e)any plea of fresh evidence, including the nature and significance of the evidence and the reason why it was not part of the earlier proceedings; all part of –
(f)the extent of the oppression and unfairness to the other party if the issue is relitigated and the impact of the relitigation upon the principle of finality of judicial determination and public confidence in the administration of justice; and
(g)an overall balancing of justice to the alleged abuser against the matters supportive of abuse of process.[53]
[53] At 64,089. Cited in Spalla v St George Motor Finance Ltd (No 6) (ACN 007 656 555) [2004] FCA 1699 at [70] per French J and McDonald v The State of South Australia [2011] FCA 297 at [43] per Besanko J.
The professional negligence proceeding related exclusively to alleged negligence by RJ Cole & Partners in the conduct of various matters on behalf of Mr Kowalski. For the reasons explained above, it did not encompass issues of costs as between RJ Cole & Partners and Mr Kowalski. The entitlement of RJ Cole & Partners to payment for work done in respect of proceedings under the Act was not an issue in that action. Mr Kowalski had no opportunity to litigate that issue in that action. There was no evidence and no basis on which any conclusion could be made by the Judge that a claim under section 41 of the Act in relation to costs of proceedings under the Act had any connection with the professional negligence action such that an abuse of process on the relitigation ground was capable of arising.
The taxation proceeding was instituted by RJ Cole & Partners and not Mr Kowalski. Both applications by Mr Kowalski in that proceeding were dismissed by Master Lunn as misconceived. Mr Kowalski could not have joined any other claim with either application.
Abuse of process by relitigation principles was incapable as a matter of law of precluding Mr Kowalski from bringing the RJ Cole & Partners proceeding in the Industrial Relations Court.
The scope of the proceeding
Section 41 of the Act is confined in its operation to “costs in respect of any proceedings under the Act”. The reference to “proceedings under the Act” is a reference predominantly to proceedings instituted in the Industrial Relations Court in relation to personal injury allegedly suffered by a worker arising out of or in the course of employment governed by the Act. By virtue of the breadth of the words “in respect of”, section 41 applies not only to costs incurred in proceedings but to costs incurred in preparation for or for the purposes of or in connection with proceedings, including advice about the commencement of proceedings.
The Full Court observed that the work undertaken by RJ Cole & Partners in respect of proceedings under the Act was relatively limited. It encompasses work associated with the proceeding instituted in July 1992 and earlier advice in relation to the potential institution of proceedings in relation to Mr Kowalski’s entitlements under the Act. It does not extend to any work undertaken in relation to Mr Kowalski’s back injury (including the back injury action).
The issues to be decided in the proceeding are relatively narrow. RJ Cole & Partners prepared a bill of costs in taxable form for the taxation proceeding on the Supreme Court scale. It should be straightforward to isolate in that bill the work undertaken by RJ Cole & Partners in respect of proceedings under the Act and the amount prescribed for those items under the Industrial Relations Court scale (as opposed to the Supreme Court scale). It should be straightforward to identify monies of Mr Kowalski appropriated by RJ Cole & Partners in payment for work undertaken. This will leave four issues to be determined by the Industrial Relations Court, namely:
1.whether having regard to the philosophy of section 41 Mr Kowalski should pay for work (or some of it) undertaken by RJ Cole & Partners in respect of proceedings under the Act;
2. the amount that should be payable by Mr Kowalski for work undertaken by RJ Cole & Partners for which he should pay (if any) having regard to the Industrial Relations Court scale and other relevant considerations;
3.the amount paid to or appropriated by RJ Cole & Partners for work undertaken in respect of proceedings under the Act;
4.in light of the answers to 1, 2 and 3, whether there is an amount refundable by RJ Cole & Partners to Mr Kowalski.
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.
However, soon after MMAL paid over the $23,000, the Chief Executive Officer of WorkCover declined to approve the settlement. The balance of $3,881.55 still in the respondents’ trust account was insufficient to reimburse MMAL. The steps taken to secure reimbursement were complicated and ultimately the issue of reimbursement was overtaken by a further settlement of all of the appellant’s claims concerning MMAL in October 1998. It is unnecessary to set out here the detail of these events which were summarised by the Judge at first instance.[56]
[56] Kowalski v Cole & Ors [2011] SAIRC 61 at [11]-[17].
In the present proceedings, the appellant has sought to recover from the respondents the two amounts of $18,634.66 and $483.79 on the basis, inter alia, of there having been a failure to comply with the requirements of section 41 of the Workers Compensation Act 1971.
The Judge took the view that, at least insofar as the amount of $18,634.66 is concerned, no tenable claim pursuant to section 41 had been pleaded.[57]
The major component of the costs recovery of which the applicant complains is the account of 30 March 1992 in the sum of $18,634.66. It is not in dispute that this account relates entirely to work done by the respondents and disbursements incurred with respect to the District Court negligence proceedings relating to the back injury which was alleged to have occurred in May 1989, a date after 30 September 1987 when the WCA was repealed. Any entitlement to compensation or damages flowing from that injury was governed by the current Act. Proceedings to recover any such entitlements cannot be “proceedings under” the WCA. As it happened in any event, no proceedings under the WCA came into existence until 31 July 1992, when RJ Cole filed the Application in the General Form upon the basis of which the Minutes of Order were entered. The costs of the back injury claim detailed in the account of 30 March 1992 were incurred well before this date, and clearly related to proceedings falling outside the scope of the WCA. On the material before me, the only possible conclusion that can be reached is that the costs of $18,634.66 were not costs of proceedings under the WCA, and that s 41 has no application to recovery of those costs.
[footnote omitted]
[57] Kowalski v Cole & Ors [2011] SAIRC 61 at [43].
According to the Judge, the position concerning the claim for the sum of $483.79 raised different considerations.[58]
The same outcome would appear likely with respect to the costs paid for the eye injury claim in the sum of $483.79 even though that claim was governed by the WCA in contrast to the back injury claim. The account for these costs was not in evidence, but according to an extract from an account ledger annexed to the applicant’s summons, it appears that the amount related to work done by November 1991, well before there were any proceedings under the WCA. The fees charged do not appear to relate to any aspect of the Application in the General Form filed on 31 July 1992 or to work done subsequently, but rather to the common law proceedings already on foot with respect to the claim. If the Court had jurisdiction to deal with the applicant’s claim for a refund of this sum, the issue as to when the work the subject of this account was done would have to be determined on a merits hearing. However, even if the account did relate to proceedings under the WCA, and even if the Court could make an order for recovery in the event of a breach of s 41(2), there are yet other legal impediments to a pursuit of any claim for recovery of the fees paid in relation to either account.
[footnote omitted]
I find the Judge’s reasoning persuasive. However, it is not necessary that I form a concluded view on whether a tenable claim is raised. The time point is against the appellant.
[58] Kowalski v Cole & Ors [2011] SAIRC 61 at [47]
I agree with the reasons of the Judge at first instance that, to the extent that the appellant’s claim for reimbursement of legal costs is based on a common law entitlement or cause of action which is independent of the constraint imposed by section 41 of the Workers Compensation Act 1971, such falls outside the jurisdiction of the Industrial Relations Court.[59] However, I agree with the Full Court of the Industrial Relations Court[60] and with Blue J that the Industrial Relations Court does have jurisdiction to hear the appellant’s claim under section 41 of the Workers Compensation Act for the recovery of those costs incurred (and paid) in respect of proceedings under the Workers Compensation Act. This is because the proper application of and the need to comply with section 41 with respect to such costs charged and received by the respondent are matters ancillary to the original questions and disputes arising under section 21.
[59] Kowalski v Cole & Ors [2011] SAIRC 61 at [22]-[33].
[60] Kowalski v Bourne and RJ Cole and Partners [2015] SAIRC 17 at [58]-[68], contra Kowalski v Bourne [2011] SAIRC 62 at [30] (Judge Hannon).
However, in my view it is unnecessary to decide whether or not the jurisdiction conferred on the Industrial Relations Court pursuant to section 41 with respect to legal costs charged is properly to be characterised as a supervisory jurisdiction of the limited kind described by Blue J.[61]
[61] Cf; the Full Court in Kowalski v Bourne and RJ Cole and Partners [2015] SAIRC 17 at [69]-[71].
Even on this assumption, any such supervisory jurisdiction would not, of itself, found the cause of action relied upon by the appellant when seeking to recover legal costs paid in contravention of the requirements of section 41. Section 41 has been quoted in full in the judgment of Blue J.
(i)Subsections (1) and (1a) provide for a conventional jurisdiction in the Court to award costs inter partes but with a significant restriction on when costs might be ordered against a “workman”.
(ii)Subsection (1b) provides for circumstances in which a legal practitioner might be ordered personally to pay the other party’s costs.
(iii)Subsection (4) is definitional.
(iv)Subsections (2) and (3) are in the following terms.
(2) No legal practitioner acting for a workman shall be entitled to recover from that workman any costs in respect of any proceedings under this Act or to claim a lien in respect of such costs on or to deduct such costs from any sum awarded as compensation unless those costs have been awarded by the Court.
(3) No agreement by a person claiming compensation to pay any amount by way of costs greater than the amount awarded by the Court shall be binding on that person and any amount paid by that person by way of costs in excess of the amount so awarded shall be recoverable by that person as a debt due to him.

Subsection (2) provides, in effect, that no legal practitioner is entitled to recover, in any way, relevant legal costs from their worker client unless those costs have been awarded by the Court. Subsection (3) provides, in effect, that no agreement by the worker client to pay legal costs in an amount greater than an amount awarded by the Court shall be binding on the worker client and “any [excess] amount [so] paid shall be recoverable by the [worker client] as a debt ...”.
The essence of the appellant’s claim against the respondent for recovery of the legal costs paid to the respondent or part thereof is that the costs were charged in contravention of the relevant statutory requirements.
It will have been contrary to the statutory requirements if and to the extent that the legal costs in question were incurred “in respect of any proceedings under [the] Act” and were charged in the absence of a court award.
Further, to the extent that the costs in question were incurred “in respect of any proceedings under [the] Act” and were paid pursuant to an agreement caught by section 41(3), any such agreement would not have been binding and the appellant would have been entitled to recover the relevant amount as a debt.
I have emphasised the phrase “to the extent that” because the extent to which the costs charged and received necessarily related to proceedings under the Act is a live issue, as Blue J has explained and as the Judge explained in the passages set out earlier.
Independently of whether or not the Industrial Relations Court’s involvement in the appellant’s recovery action is to be characterised as fulfilling a supervisory function, for the appellant to succeed he must establish that a relevant component of the costs was paid in contravention of the statutory requirements. It will be the terms of the statute as applied to the relevant facts that will found any cause of action.
The appellant’s cause of action, insofar as it relies on there having been a failure to comply with section 41(2) is a claim for the recovery of money paid under mistake or otherwise based on restitution grounds, falling within section 38(1) of the Limitation of Actions Act 1936.
38—Limitation on actions for recovery of money
(1)Subject to subsection (2), an action for the recovery of money paid under a mistake (either of law or of fact) or otherwise based on restitutionary grounds must be commenced—
(a) if the cause of action arose on or after the commencement of this section—within 6 years after the cause of action arose; or
(b) if the cause of action arose before the commencement of this section—within the limitation period that would have been applicable if this section had not been enacted or 6 years after the commencement of this section (whichever expires first).
(2)-(5) ...
The appellant’s cause of action, insofar as in reliance on section 41(2), accrued no later than 31 August and 2 September 1992 when the two sums were, respectively, transferred out of the respondents’ trust account. Section 38(1) commenced operation on 17 June 1993. As such, the cause of action arose at a time prior to the commencement of section 38 of the Limitation of Actions Act with the result that the limitation period of six years expired no later than 16 June 1999.
The appellant’s cause of action, insofar as it were to rely on an unenforceable agreement by virtue of section 41(3) would be an action for a debt due. It, arguably, might fall within section 35(a) or (b) of the Limitation of Actions Act, but more likely would also fall within section 38(1). In the former case, the limitation period is six years from the date the cause of action accrued which expired in the case of the two amounts in question, respectively, on 30 August and 1 September 1998. In the latter case, the limitation period expired no later than 16 June 1999.
In either case, the appellant’s cause of action was, as at the time he filed his application that came before the Judge (7 March 2011) very substantially out of time. The appellant has not sought an extension of time. I agree with the Judge’s observation[62] that:
I conclude that the claims now brought by the applicant in this Court, even if within jurisdiction, and even if they were tenable, are statute barred as they have been made more than six years after the alleged causes of action accrued. The applicant has not sought an extension of time on the basis of the ascertainment of a material fact within twelve months of issue of the proceedings, and even if he had, there would have been little prospect of establishing the ascertainment of a relevant material fact given the extensive dealings between the parties and disclosure of information over a period of many years before the summons was issued.
[62] Kowalski v Cole & Ors [2011] SAIRC 61 at [52].
I would allow the appeal; set aside the orders of the Full Court and in lieu thereof substitute an order dismissing the appeal from the Judge.
HINTON J:
Introduction
I have had the benefit of reading in draft the judgments of Blue J and Nicholson J for which I am grateful. The background to this matter, the decisional history, the grounds of appeal, the grounds contained in the Second Notice of Contention, and the arguments made have been set out by Blue J. I do not repeat them.
For the reasons given by Blue J I would grant to the respondent an extension of time in which to file the Second Notice of Contention. I would uphold the first ground contained in the Second Notice of Contention. My reasons follow.
Did the Industrial Court have jurisdiction to hear the application?
In his application Mr Kowalski states that he seeks the following orders:
1.   A declaration that on 24 June 1992 the applicant signed a Notice of Acceptance in Local Court of Adelaide action No.29448 of 1991.
2.   A declaration that on 27 August 1992 JA Fountain and S Dowd deleted par 7 of the Minutes of Order in the Industrial Court of South Australia action No. 185 of 1992.
3.   A declaration that on 27 August 1992 Judge Cawthorne signed the Minutes of Order in the Industrial Court of South Australia action No.185 of 1992, for the sum of $23,000.00, in which the order for legal costs had been deleted, therefore, pursuant to sub-section 41(3) of the Act “No agreement by a person claiming compensation to pay any amount by way of costs greater than the amount awarded by the Court shall be binding on that person and any amount paid by that person by way of costs in excess of the amount so awarded shall be recoverable by that person as a debt due to him.”
4.   A declaration that on or about 31 August 1992 the third respondent received the sum of $23,000.00, on the applicant’s behalf, as a result of the Minutes of Order dated 27 August 1992 which is mentioned in par. 3 above.
5.   A declaration that on 31 August 1992 the third respondent deposited the sum of $23,000.00, on the applicant’s behalf, as a result of the Minutes of Order dated 27 August 1992 which mentioned in par. 3 above, into its Trust Account.
6. A declaration that on 31 August 1992 the first, second and third respondent illegally transferred the sum of $18,634.66, from the sum of $23,000.00 that it had received as a result of the Minutes of Order dated 27 August 1992, which is mentioned in par. 3 above, into its Office Account on the grounds found in par’s 37, 38, 39, 40, 41 and 42 of the Full Court of the Supreme Court decision in Peter Nicholas Moloney Trading as Moloney & Partners v The Workers Compensation Tribunal [2010] SASCFC 17 (2 August 2010) and Scammell & Co v WorkCover Corporation & Anor [2006] SASC 258 (23 August 2006).
7. A declaration that on 2 September 1992 the first, second and third respondent illegally transferred the sum of $483.79, from the of $23,000.00 that it had received as a result of the Minutes of Order dated 27 August 1992, which is mentioned in par. 3 above, into its Office Account on the grounds found in par’s 37, 38, 39, 40, 41 and 42 of the Full Court of the Supreme Court decision in Peter Nicholas Moloney Trading as Moloney & Partners v The Workers Compensation Tribunal [2010] SASCFC 17 (2 August 2010) and Scammell & Co v WorkCover Corporation & Anor [2006] SASC 258 (23 August 2006).
8.   A declaration that, in view of declaration No.1 to 7 inclusive above, on 31 August 1992 and on 2 September 1992 the first, second and the third respondent obtained the sum of $18,634.66 and the sum of $483.79 from the applicant illegally, by FRAUD and unconscionably.
9.   A declaration that, in view of declaration No. 1 to 8 inclusive above, the first, second and the third respondent must return the sum of $18,634.66 and the sum of $483.79 to the applicant, plus compound interest since 31 August 1992 on the ground that in the High Court of Australia decision in Farley v Alexander & Sons [1946] HCA 29; (1946) 75 CLR 487 Justice Williams has correctly stated that “…Fraud is conduct which vitiates every transaction known to law. It even vitiates a judgment of the Court. It is an insidious disease, and if clearly proved spreads to and infects the whole transaction (Jones v Beard (1930) AC 298, at pp 301, 302 …”.
10. An order that, in view of declarations No. 1 to 9 inclusive above, on 31 August 1992 and on 2 September 1992 the first, second and third respondent breached subsection 41(3) of the Workmen’s Compensation Act 1971 (SA) as amended, (the Act) and they committed a FRAUD on the applicant and on the Industrial Court of South Australia on the ground than on 31 August 1992 and on 2 September 1992 the first, second and the third respondent was prevented by ss41(3) of the Act from transferring the sum of $18,634.66 and the sum of $483.79 from the third respondent’s Trust Account into the Third respondent’s Office Account, in order to pay for their legal costs and disbursements, on the ground that, pursuant to sub-section 41(3) of the Act, “No agreement by a person claiming compensation to pay any amount by way of costs greater than the amount awarded by the Court shall be binding on that person and any amount paid by that person by way of costs in excess of the amount so awarded shall be recoverable by that person as a debt due to him.”
(emphasis in original).
Despite the breadth of relief sought, Mr Kowalski grounded his application on the alleged breach of the prohibition contained in s 41(2) of the Workmen’s Compensation Act 1971 (SA) (WCA). Further, before the single judge, on appeal, and in this Court he submitted that the power to grant the relief he sought was to be found in s 41 WCA.
The WCA was repealed by the Workers Rehabilitation and Compensation Act 1986 (SA) (WRCA). The transitional provisions of the WRCA made plain that the repealed Act continued to apply in respect of an injury that was attributable to a trauma that occurred before the appointed day, being 30 September 1987.[63] Mr Kowalski’s eye injury occurred before the appointed day but his back injury did not. His back injury occurred on 9 May 1989. Thus, the WCA did not apply in relation to the $18,634.66 in costs incurred for the back injury claim. I agree with the single Judge that:[64]
The major component of the costs recovery of which the applicant complains is the account of 30 March 1992 in the sum of $18,634.66. It is not in dispute that this account relates entirely to work done by the respondents and disbursements incurred with respect to the District Court negligence proceedings relating to the back injury which was alleged to have occurred in May 1989, a date after 30 September 1987 when the WCA was repealed. Any entitlement to compensation or damages flowing from that injury was governed by the current Act. Proceedings to recover any such entitlements cannot be “proceedings under” the WCA. As it happened in any event, no proceedings under the WCA came into existence until 31 July 1992, when RJ Cole filed the Application in the General Form upon the basis of which the Minutes of Order were entered. The costs of the back injury claim detailed in the account of 30 March 1992 were incurred well before this date, and clearly related to proceedings falling outside the scope of the WCA. On the material before me, the only possible conclusion that can be reached is that the costs of $18,634.66 were not costs of proceedings under the WCA, and that s 41 has no application to recovery of those costs.
(footnote omitted).
[63] Workers Rehabilitation and Compensation Act 1986 (SA) sch 1 cl 2(1); South Australia, Gazette, No 51, 17 September 1987, 886.
[64] Kowalski v Cole & Ors [2011] SAIRC 61 at [43].
No alternate source of power to grant the relief sought in relation to the $18,634.66 was identified in submissions before either the single Judge or the Full Court. That the $18,634.66 did not represent costs incurred for work done under the WCA is enough to dispose of the jurisdiction question as it purported to apply to that sum.
I turn to consider whether the Industrial Relations Court has jurisdiction in relation to the relief sought regarding the $483.79 paid in satisfaction of legal fees incurred by the respondent in the course of acting for Mr Kowalski in relation to his eye injury.
Blue J has explained how in the Industrial Relations Court and in the Full Court of the Industrial Relations Court this matter was heard with the related matter of Kowalski v Bourne and the commonality in the issues raised by each matter.[65] In what follows I rely upon my analysis of ss 21 and 41 WCA in Kowalski v Bourne.[66] I do not repeat it.
[65] At [16]-[21].
[66] Kowalski v Bourne [2017] SASCFC 23 at [126]-[143].
The Full Court held that there was nothing to prevent RJ Cole & Partners from making an application under sub-rule 122(1) of the Workers Compensation Rules 1980 (SA) for an order as to costs as between legal practitioner and client. Accordingly, the combination of that rule and s 41 of the WCA gave the Industrial Court a supervisory jurisdiction over costs as between solicitor and client.
In my view, s 41 WCA does not confer a general supervisory power in relations to costs incurred in relation to workplace injuries to which the WCA applies. In particular, s 41 confers no general jurisdiction to make a declaration as to money paid contrary to s 41(2), nor to order the return of any sum paid in breach of s 41(2). True it is that an application could have been made by R J Cole & Partners under sub-rule 122(1) for an order for costs against Mr Kowalski in the sum of $483.79, but the power to award costs contained in s 41(1) WCA does not carry with it by necessary implication power to order the repayment of any sum paid contrary to s 41(2) or to declare a payment made by a worker one received in contravention of s 41(2). In my view, any right to money wrongly paid must be pursued by Mr Kowalski in the courts of general jurisdiction in the ordinary way.
As I concluded in Kowalski v Bourne[67] the error committed by the Full Court was in eliding s 21 and s 41 WCA.[68] The two powers are separate and do not overlap. The rules made under the WCA can take the matter no further. Rules made under s 130 WCA supplement those powers granted by the Act and cannot extend them.
[67] [2017] SASCFC 23 at [143].
[68] Kowalski v Bourne & RJ Cole & Partners [2015] SAIRC 17 at [67].
I would uphold the first ground contained in the Second Notice of Contention.
Was the application time barred?
In view of my answer to the first question it is unnecessary to answer this question. However, if I am wrong, I agree with Blue J, that s 38 of the Limitation of Actions Act 1936 (SA) does not apply. If the Industrial Relations Court does have jurisdiction under the WCA, any applicable time limit is to be found in the WCA or relevant rules. I would dismiss grounds two and three of the Second Notice of Contention.
Was the application an abuse of process?
I agree with Blue J, for the reasons he has given, that the Full Court failed to afford Mr Kowalski procedural fairness.
As in the case of Kowalski v Bourne it is tempting to conclude that the denial of procedural fairness was not material bearing in mind Mr Kowalski’s manner in conducting his appeal in this Court, however the basis for the Full Court’s decision was materially different to that of the judge and Mr Kowalski has not been heard in response to it nor been given the opportunity to adduce any relevant evidence. It is also important to bear in mind that Mr Kowalski is self-represented.
I would dismiss the fourth ground of the Second Notice of Contention for the reasons given by Blue J.
Conclusion
I would uphold the first ground of the respondent’s Second Notice of Contention, set aside the orders of the Full Court and in lieu thereof substitute an order dismissing the appeal from the Judge.