Lim v Comcare

Case [2016] FCA 1346

FEDERAL COURT OF AUSTRALIA

Lim v Comcare [2016] FCA 1346

Appeal from: Lim v Comcare [2016] FCA 709
File number: ACD 50 of 2016
Judge: WIGNEY  J
Date of judgment: 11 November 2016
Catchwords: COSTS – interlocutory application for security of costs pursuant to s 56 of the Federal Court of Australia Act 1976 (Cth) and r 36.09 of the Federal Court Rules 2011 (Cth) – whether the appellant has sufficient prospects of success – where the appellant has not advanced evidence of impecuniosity or financial hardship – where the appellant has not paid costs of the primary proceedings
Legislation:

Safety, Rehabilitation and Compensation Act 1988 (Cth)

Administrative Appeals Tribunal Act 1975 (Cth), s 44

Federal Court of Australia Act 1976 (Cth), ss 24, 56

Federal Court Rules 2011 (Cth), rr 36.09, 36.11(1)
Cases cited:

Clack v Collins (No 1) [2010] FCA 513

Comcare v Martin [2016] HCA 43

Comcare v Mooi (1996) 69 FCR 439

Dranichnikov v Centrelink [2002] FCA 1622

Equity Access Ltd v Westpac Banking Corporation [1989] FCA 520

Singh v Secretary, Department of Employment and Workplace Relations [2007] FCA 90

Soh v Commonwealth of Australia [2008] FCA 1524

Tait v Bindal People [2002] FCA 322

Willoughby v Clayton [2008] WASCA 93
Date of hearing: 12 August 2016
Registry: New South Wales
Division: General Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 48
Counsel for the Appellant: The appellant appeared in person, assisted by a “McKenzie friend”, Dr J Read
Counsel for the Respondent: Mr Berger
Solicitor for the Respondent: Sparke Helmore Lawyers

ORDERS

ACD 50 of 2016
BETWEEN:

SHARON LIM

Appellant
AND:

COMCARE

Respondent

JUDGE:

WIGNEY  J

DATE OF ORDER:

11 NOVEMBER 2016

THE COURT ORDERS THAT:

1.Within 28 days of the date of these orders the appellant give security for the respondent’s costs of the appeal in the sum of $15,000 by:

(a)paying the money into Court; or

(b)providing to a Registrar of this Court an unconditional bank guarantee from an Australian-owned bank (as recognised by the Australian Prudential Regulation Authority) in a form acceptable to the Registrar.

2.In the event that the security is not provided in accordance with Order 1, any hearing date allocated for the appeal be vacated and the appeal be stayed.

3.In the event that the security referred to in Order 1 is not paid within 56 days of the date of these orders, the appeal be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

WIGNEY J:

  1. The applicant, Dr Sharon Lim, is a former employee of the Australian Communications and Media Authority (ACMA).  In March 2011, Dr Lim submitted a claim for compensation under the Safety, Rehabilitation and Compensation Act 1988 (Cth). Comcare subsequently disallowed Dr Lim’s claim. Dr Lim sought a review of that adverse decision in the Administrative Appeals Tribunal. That review application was unsuccessful. Comcare’s decision was affirmed by the Tribunal. Dr Lim then filed an…

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AGLC
Lim v Comcare [2016] FCA 1346
Case
[2016] FCA 1346
Decision Date

CaseChat Overview and Summary

Dr Lim appealed against the Tribunal's decision to the Federal Court, which subsequently dismissed the appeal. Comcare subsequently applied for security for costs in relation to the appeal. The central issue was whether the appellant had sufficient prospects of success. Dr Lim had not advanced evidence of impecuniosity or financial hardship, nor had she paid the costs of the primary proceedings. The court had to determine whether Dr Lim had sufficient prospects of success on the appeal. The court considered the evidence provided by Comcare, which largely comprised evidence of communications between Comcare's lawyers and Dr Lim. The court also noted that Dr Lim had not paid Comcare any amount in respect of the costs order made at first instance. The court found that Dr Lim's appeal did not have sufficient prospects of success. The appeal was dismissed, and Dr Lim was ordered to give security for Comcare's costs of the appeal in the sum of $15,000. If the security was not provided within 56 days, the appeal would be dismissed.

Orders

Orders of the court

1. Within 28 days of the date of these orders the appellant give security for the respondent’s costs of the appeal in the sum of $15,000 by:

(a) paying the money into Court; or

(b) providing to a Registrar of this Court an unconditional bank guarantee from an Australian-owned bank (as recognised by the Australian Prudential Regulation Authority) in a form acceptable to the Registrar.

2. In the event that the security is not provided in accordance with Order 1, any hearing date allocated for the appeal be vacated and the appeal be stayed.

3. In the event that the security referred to in Order 1 is not paid within 56 days of the date of these orders, the appeal be dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

For the reasons that follow, an order for security for costs of Dr Lim’s appeal in the sum of $15,000 is appropriate. BACKGROUND It is necessary to provide some background, albeit in the briefest possible terms, in respect of Dr Lim’s appeal. That is because, in support of it application for security for costs, Comcare contended that Dr Lim’s appeal does not have good prospects of success. In opposing Comcare’s application, on the other hand, Dr Lim contended that her appeal had significant prospects of success. Dr Lim’s claim for compensation was based on her suffering from an “adjustment reaction with depressant anxiety” as a result of alleged bullying and harassment by her supervisor at ACMA. There appears to have been no dispute that Dr Lim suffered from a psychological condition at the time of her claim, though the assertion that this was the result of bullying or harassment was contested. The critical question in determining whether Dr Lim was able to claim compensation in relation to the condition suffered by her was whether that condition was an “injury” as defined in s 5A of the Compensation Act. That question primarily turned on whether or not the psychological condition was suffered as a result of reasonable administrative action taken in a reasonable manner in respect of Dr Lim’s employment. If it was, the condition was not an injury for the purposes of the Compensation Act. That is because s 5A excludes, from the statutory definition of injury, any injury, disease, or aggravation of an injury or disease, that was suffered as a result of reasonable administration action. The question whether Dr Lim’s psychological condition was suffered as a result of reasonable administrative action hinged largely on when she suffered that condition. Comcare contended that reasonable administrative action by Dr Lim’s supervisor in early 2011 contributed significantly to the development of Dr Lim’s psychological condition. If that was the case, Comcare submitted that Dr Lim suffered her condition as a result of that action. Dr Lim, on the other hand, contended that she suffered the condition well before early 2011. She therefore maintained that her condition could not have been suffered as a result of any relevant administrative action by her supervisor in 2011. The Tribunal found that Dr Lim’s psychological condition was suffered on or a few days before she consulted a doctor in mid-March 2011. The Tribunal also found that the action taken by Dr Lim’s supervisor in early 2011 both contributed to the development of Dr Lim’s psychological condition and was reasonable administrative action taken in a reasonable manner in respect of Dr Lim’s employment. The Tribunal concluded that Dr Lim’s condition therefore fell within the exclusion in s 5A and was therefore not an injury for the purposes of the Act. An appeal to this Court from the Tribunal is confined to questions of law: Administrative Appeals Tribunal Act 1975 (Cth) s 44. The questions of law that ultimately formed the basis of Dr Lim’s appeal from the Tribunal’s decision essentially revolved around the two key findings made by the Tribunal: first, that Dr Lim’s psychological condition was suffered in March 2011; and second, that is was suffered as a result of reasonable administrative action by her supervisor. The questions before the primary judge were ultimately framed in the following terms:ERROR 1: Whether the Tribunal was operating under a misconception that needed to be satisfied of an appropriate clinical diagnosis of the psychological disturbances the applicant reported before it could find she had suffered an “injury” within s 5A(1) of the SRC Act?ERROR 2: Whether the Tribunal misunderstood its statutory task and approached the determination of whether the applicant had suffered an injury for the purposes of s 5A by the application of a formula purportedly derived from an expression of Drummond J in Comcare v Mooi [1996] FCA 508, (1996) 69 FCR 439 (said to be at 444)?ERROR 3: Whether the Tribunal misunderstood its statutory task and misconstrued the expression “suffered as a result of” in s 5A of the SRC Act?ERROR 4: Whether the Tribunal failed to provide reasons in breach of its obligation under s 43(2B) of the AAT Act in respect of its finding that the performance appraisal having “contributed to [the applicant’s] psychological condition at [42] of its Reasons?ERROR 5: Whether the Tribunal misunderstood its statutory task and unnecessarily confined the ambit and operation of s 7(4) of the SRC Act?

Evidence

Evidence Before The Court

Where security for costs is sought in respect of an appeal, it may also be relevant that the appellant has not satisfied an adverse costs order arising from the proceedings at first instance: Singh v Secretary, Department of Employment and Workplace Relations [2007] FCA 90 at [13]-[14]; Dranichnikov v Centrelink [2002] FCA 1622 at [19]; Willoughby v Clayton [2008] WASCA 93 at [15]. The fact that a costs order in respect of the proceedings at first instance has not been satisfied would tend to suggest that there is at least a risk that the appellant may not, or may not be able to, meet any adverse costs order arising from the appeal.EVIDENCE AND SUBMISSIONS Comcare’s evidence in support of its application for security for costs largely comprised evidence of communications between its lawyers and Dr Lim. That correspondence concerned the payment of Comcare’s costs of the proceedings before the primary judge, as well as the provision of information to enable Comcare to assess whether there was a risk that Dr Lim would not be able to satisfy any costs order should her appeal be unsuccessful. In relation to the payment of the costs of the proceedings before the primary judge, on 8 August 2016, Comcare’s lawyers wrote to Dr Lim seeking payment of Comcare’s costs of $47,701.41 (comprising solicitors’ costs of $20,999 and disbursements, mainly in relation to counsel’s fees, of $26,702.41). The letter pointed out that Comcare had a presumptive right to indemnity costs because Comcare had, prior to the hearing of the appeal from the Tribunal, sent Dr Lim an offer to resolve the matter and a notice of offer of compromise. Dr Lim did not immediately respond to the letter requesting payment of Comcare’s costs. After a follow up email from Comcare’s lawyers dated 26 August 2016, Dr Lim eventually responded on 3 September 2016. She requested copies of relevant invoices, together with certain other information she claimed was relevant to her consideration of the “costs issue”. Comcare’s lawyers provided copies of the invoices to Dr Lim under cover of a letter dated 22 September 2016. That letter also responded in a reasonable fashion to Dr Lim’s request for information. Dr Lim has not paid Comcare any amount in respect of the costs order made at first instance. In relation to the costs of the appeal from the judgment of the primary judge, on 19 September 2016 Comcare’s lawyers wrote to Dr Lim and requested certain information to enable Comcare to consider whether it should apply for security for costs of the appeal. That information included whether Dr Lim was presently earning any income and, if so, what that income was; whether Dr Lim owned any property and, if so, what the estimated value of that property was; and whether Dr Lim owned any other assets or had any other sources of income that may be called upon in the event that she was ordered to pay Comcare’s costs of the appeal from the judgment of the primary judge. The letter noted that if Dr Lim did not respond to the request for the specified information, her “non-response may be cited as a reason in support of any application for security for costs.” Dr Lim did not respond to the request for information.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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