Logan v Aberdeen Holdings (Aust) Pty Ltd

[2011] VCC 1417

IN THE COUNTY COURT OF VICTORIA Revised

Not Restricted

AT GEELONG
CIVIL DIVISION
DAMAGES AND COMPENSATION

SERIOUS INJURY DIVISION

Case No. CI-10-04138

LEE WILLIAM LOGAN	Plaintiff
v
ABERDEEN HOLDINGS (AUST) PTY LTD	Defendant

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JUDGE:	HIS HONOUR JUDGE PARRISH
WHERE HELD:	Geelong
DATE OF HEARING:	13 and 17 October 2011
DATE OF RULING:	15 November 2011
CASE MAY BE CITED AS:	Logan v Aberdeen Holdings (Aust) Pty Ltd (Ruling)
MEDIUM NEUTRAL CITATION:	[2011] VCC 1417

RULING

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Catchwords: ACCIDENT COMPENSATION – Accident Compensation Act 1985 – serious injury – costs – counsels’ fees – to be assessed by the Costs Court or to be certified by the presiding judge.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr C W R Harrison SC with	Ryan Carlisle Thomas
Mr A E A MacNab
For the Defendant	Mr R K Meldrum QC with	Wisewould Mahony Lawyers
Ms A M Magee
HIS HONOUR:

1          The issue to be determined is whether in this proceeding this Court should certify for the number of counsel and the amount of counsels’ fees or such matters should be assessed by the Costs Court.

Background

2 In this proceeding, the plaintiff sought leave pursuant to s.134AB(16)(b) of the Accident Compensation Act 1985, as amended (“the Act”), to bring common law proceedings for both pain and suffering damages and pecuniary loss damages in relation to a left shoulder injury said to have occurred arising out of or in the course of his employment with the defendant on 8 June 2002.

3          In his opening, Senior Counsel for the plaintiff informed the Court that the plaintiff relied on both paragraphs (a) and (c) of the definition of “serious injury” contained in s.134AB(37) of the Act. Furthermore, the Court was informed that the defendant, or its agents, had accepted claims in relation to the left shoulder, and depression.[1]

[1]             See generally Ansett Australia Ltd & Anor v Taylor [2006] VSCA 171

4          Senior Counsel for the defendant informed the Court that the essential issues involved in the application were:

(a)	whether the present condition of the left shoulder of the plaintiff, which involved a SLAP tear, had any relationship to the initial injury or indeed, as postulated by Professor Hart on behalf of the defendant, was a result of the plaintiff’s alleged weightlifting activities; and
(b)	to the extent that the plaintiff suffered any mental or behavioural disturbance, whether such could be described as “severe” within the meaning of paragraph (c) of the definition of “serious injury”.

5          The plaintiff adopted his affidavits and gave some further evidence-in-chief. He was extensively cross-examined by Senior Counsel for the defendant for the balance of 13 October 2011.

6          The plaintiff relied on, in part, a medical report from his treating orthopaedic surgeon, Associate Professor R S Page, who was required by the defendant for cross-examination. Associate Professor Page adopted his reports and gave some further viva voce evidence-in-chief and thereafter was cross- examined by Junior Counsel for the defendant.

7          In particular, the opinion of Professor Hart was put to Associate Professor Page. Mr Page rejected the opinion of Professor Hart and maintained his fundamental opinion as to the causation of the injury suffered by the plaintiff.

8          Shortly after that evidence, I was informed by Counsel that the Victorian WorkCover Authority was prepared to issue the plaintiff a certificate consenting to the plaintiff bringing common law proceedings for pain and suffering damages and pecuniary loss damages in respect to the work incident on 8 June 2002.

The Costs Issue

9          Senior Counsel for the plaintiff essentially sought the following orders in relation to costs:

(a)	The defendant to pay the costs of the plaintiff on Scale D of the County Court Scale up to 1 September 2011 and thereafter to be determined by the Costs Court in default of agreement;
(b)	Certification for two Counsel with a daily fee of Senior Counsel of $6,000 (for two days) inclusive of circuit fee, and a daily fee of $3,000 (for two days) inclusive of circuit fee for Junior Counsel.

Certification for three hours of special conferences at $600 per hour for
Senior Counsel and at $300 per hour for Junior Counsel;

(c) Certification for court books filed by the plaintiff.

10        In support of the position advocated by Senior Counsel for the plaintiff, it was submitted that:

(a)

I should certify as to the number of counsel and the quantum of counsels’ fees because, as the presiding Judge, I was in the best position to observe the complexities, nuances and difficulties associated with any serious injury claim. In this sense, if a Costs Court was called upon to determine whether two counsel were appropriate, and the fees for such counsel, such court would lose the advantage had by the presiding Judge and would have to form its views based on such material such as, perhaps, the transcript and written and/or oral submissions on behalf of either party;

(b)

If a court certifies in relation to the number of counsel and counsels’ fees, at the completion of a serious injury proceeding, it is of great advantage to solicitors acting for plaintiffs to have precise knowledge as to what can be recovered on a party-party basis from the other side in relation to counsels’ fees.

When a solicitor is required to advise his or her client as to what would be the “net” result of accepting, for example, a statutory offer within the conferencing period contemplated by s.134AB(12) of the Act, he or she would know precisely what is recoverable by way of counsels’ fees. If this Court did not certify as to the number of counsel and the amount of fees, there would inherently be caused a delay until such time as the Costs Court determines those issues. In particular, it was submitted that it is unlikely that the Costs Court would be able to determine such matters in the periods contemplated by the Act for conferencing, statutory offers and counteroffers;

(c)

The Court should effectively take judicial notice that those barristers acting on behalf of defendants on instructions from the Victorian WorkCover Authority are all paid on a daily fee basis agreed to by the barrister and the Authority. It was submitted that effectively the Court, being cognisant of such a situation, would be in the best position to give some type of parity, as it were, between the fees on which counsel for defendants are retained and fees which can be recovered by counsel appearing on behalf of plaintiffs;

(d)

On the present state of the law, if a court certifies a particular fee for counsel, such fee, so it is submitted, would not be subject to the twenty per cent reduction contemplated by the Act and the regulations made thereunder. On the other hand, if the Costs Court assesses such fees, it is probable that such fees will be reduced by twenty per cent. It is inequitable, so it is submitted, that if a court so certifies, the barrister does not lose the twenty per cent margin, whereas if the Costs Court assesses such fees, the twenty per cent margin may well be applied. Furthermore, such inequity is compounded when considering that counsel retained for defendants are not subject to any twenty per cent reduction.

11        The fundamental submission of the defendant is that the old Rules in relation to costs applicable up to 1 September 2011 made no provision for Senior Counsel at all and had four scales for costs for counsel based on the quantum of any particular claim.

There was clearly a discretion in those Rules (as there is in the present Rules) to certify for more than one counsel (including Senior Counsel) and the quantum of counsels’ fees. However, under the new Rules applicable from 1 September 2011, there is set out a variety of matters for the Costs Court to take into account as to matters pertaining to the number of Counsel and the fixing of counsels’ fees. In such circumstances, although accepting that this Court retains a discretion in relation to such matters, such matters should be referred to the Costs Court as the appropriate body to assess such issues.

The Costs Court

12        The Costs Court was established by the Courts Legislation Amendment (Costs Court and Other Matters) Act 2008 which inserted a new Division 2B of Part 2 of the Supreme Court Act 1986 and was effective from 31 December 2008. The amending Act also made amendments to the County Court Act 1958, the Magistrates’ Court Act 1989, the Victorian Civil and Administrative Tribunal Act 1998 and the Legal Profession Act 2004.

13        The Costs Court has jurisdiction to hear and determine the assessment, settling, taxation or review of costs in all proceedings in the Supreme Court, County Court, Magistrates’ Court and the Victorian Civil and Administrative Tribunal, and costs in an arbitration subject to the Commercial Arbitration Act 1984.[2]

[2] See Section 17D of the Supreme Court Act 1986

14 Section 78A of the County Court Act 1959 states, in part:

“(1)	The costs of and incidental to all proceedings are in the discretion of the Court and the Court may determine by whom and to what extent the costs are to be paid.
(2)	…
(3)	The Court may order that the costs of, and incidental to, a proceeding in the Court be assessed, settled, taxed or reviewed by the Costs Court. … .”

15        Pursuant to the County Court (Chapter 1) Scale of Costs (Amendment) Rules 2011 made under s.78 of the County Court Act 1958, the old Appendix A to the County Court Civil Procedure Rules 2008 was substituted by a new Appendix A setting out a Scale of Costs which came into operation on 1 September 2011 (“the new Scale of Costs”).

16        The new Scale of Costs is a result of the work of a County Court Review Committee which involved consultation with the legal profession. One reason for the need of a new Scale of Costs was that the old Scale of Costs did not adequately reflect work undertaken by the legal profession in the County Court. It is perhaps a trite observation that in the civil jurisdiction over recent years, the nature and complexity of the work has expanded. The new Scale of Costs abolishes the old Scales A to D and substitutes a new single Scale.

17        Item 42 of the new Scale of Costs deals with “Fees to Counsel”. It is to be noted that:

(a)	The concept of brief and refresher has been replaced by an entitlement to daily fees;
(b)	There is set out a range of fees for Junior Counsel and Senior Counsel for trial and appeal appearances. Such fees are to include up to four hours of preparation. Item 42(i) lists a variety of matters which the Costs Court will have regard to in allowing a fee to counsel. Such items include, inter alia, the complexity of the matter, the difficulty or novelty of the matter, the skill and specialised knowledge of counsel and the standing of counsel;
(c)	Item 42(c) of the new Rules provides that the Costs Court cannot allow counsels’ fees in excess of the Scale range in the absence of an order by the “judicial officer making the costs order”;
(d)	Such fees are exclusive of GST.

Conclusion

18        After a careful consideration of the issues raised in this proceeding, I decline to exercise my undoubted discretion to certify in relation to the number of Counsel or Counsels’ fees. Under the old Rules, it was necessary for the Court to certify for two Counsel (if appropriate) and the amount of any fees for Senior Counsel, or for Junior Counsel if above scale. Over the years, because of the increase in the complexity and nature of the work undertaken by the County Court, Senior Counsel with Junior have appeared far more regularly. Under the old Rules, if this Court did not certify for such fees, there was no basis for a party-party recovery of such fees.

19        The new Rules now permit the Costs Court to determine such issues and in my view, it would be inappropriate to persist with the old practice when the new Rules expressly provide the power for the Costs Court to allow Senior and Junior Counsel and their fees within a stated range.

20        It is abundantly clear that this Court retains a discretion to certify for the number of counsel and the amount of fees, and indeed, in an appropriate case, that discretion may be exercised on proper grounds. I consider it inappropriate and futile to attempt to describe the circumstances on which such discretion would be exercised. Clearly enough, for Senior or Junior Counsel to recover a fee above the set band of fees, it would require certification by the Court.

21        In argument, it was submitted that although one could not precisely say as to the precise length of any delay in which a Costs Court would make a determination of, in particular, counsels’ fees, there would be a delay of some time. Although appreciating that there may well be some initial delay, I consider it is likely that the Costs Court over time will give rulings in relation to serious injury proceedings, and for that matter, in a whole range of other applications, which will give guidance to solicitors as to the likely range of recovery of counsels’ fees in serious injury applications.

22        Although accepting in principle that a presiding judge does have some advantage in relation to the complexity and nuances of any particular proceeding, I again see no good reason why the Costs Court would not develop its own expertise in assessing counsels’ fees, particularly so bearing in mind the matters that it will have to have regard to as set out in Item 42(i) of the new Rules.

23        It is unfortunate that there has been a degree of inconsistency as to the application of the twenty per cent reduction provided for by the Act and the regulations made thereunder. Ultimately, it is a matter of law as to whether or not the twenty per cent reduction would apply to Counsels’ fees if determined and assessed in the band of fees as set out in Item 42. It is to be noted that the reduction applies to the applicable Scale of Costs rather than the fee per se.

24        If it be the case that when a judge certifies in relation to a fee for senior counsel or for that matter, junior counsel, such fee is not to be reduced by twenty per cent, such cannot be the basis, in my view, of a presiding judge exercising a discretion to certify such fees. Essentially, the legislature has seen fit to provide for the reduction of twenty per cent of the plaintiff’s costs and fees and it would be inappropriate that a discretion be exercised to circumvent the legislative intention.

25        Further, in my view, the amount which the Victorian WorkCover Authority may pay its barristers on a daily fee basis is not a relevant ground for a judge to exercise his or her discretion to certify for the number of counsel and fees.

26        I should add that the vast bulk of the submissions put to me by Senior Counsel for the plaintiff pertained to what I may refer to as “generic” arguments as to why the presiding judge should certify as to the number of counsel and fees. Senior Counsel for the plaintiff also urged me to exercise a discretion in the particular circumstances of the subject matter which he described as “complex” rather than “very complex”.[3]

[3]             See T 158, L29

27        Although appreciating that every serious injury application is of importance to any particular plaintiff as it is the “gateway” to sue for common law damages in respect to injury arising out of or in the course of his or her employment, I certainly do not consider that the circumstances of the subject matter are such that it would cause me to exercise a discretion to certify for Counsels’ fees.

Orders

28

Accordingly, I make the following orders:

(a)	Defendant to pay the plaintiff’s costs on Scale D of the County Court Scale of Costs up to 1 September 2011 and thereafter be assessed by the Costs Court in default of agreement;
(b)	Certify for the filing, preparation and service of the Court Books relied on by the plaintiff to be assessed by the Costs Court.

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