Mallegowda v Collins Restaurant Management Pty Ltd trading as Sizzler

[2006] NSWWCCPD 189

WORKERS COMPENSATION COMMISSION

DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS

CITATION:Mallegowda v Collins Restaurant Management Pty Limited t/as Sizzler [2006] NSWWCCPD 189

APPELLANT:  Shashi Kanth Hassan Mallegowda

RESPONDENT:              Collins Restaurant Management Pty Limited   t/as Sizzler

INSURER:QBE Workers Compensation (NSW) Limited

FILE NUMBER:  WCC3319-05

DATE OF REGISTRAR’S DECISION:             25 July 2005

DATE OF APPEAL DECISION:  17 August 2006

SUBJECT MATTER OF DECISION:                ‘Application to Resolve a Dispute’ with interim payment order; interpretation of Clause 1(2)(d) of Schedule 6 of the Workers Compensation Regulation 2003.

PRESIDENTIAL MEMBER:  Acting Deputy President Deborah Moore

HEARING:On the papers

REPRESENTATION:  Appellant:      Lexes Lawyers

Respondent:   Bartier Perry

ORDERS MADE ON APPEAL:  1.        The decision of the Registrar dated 25
  July 2005 is revoked and the following   decision is made in its place:

(i)        The Respondent is to pay the   amount of $3,025. inclusive of

GST to the Appellant.

(ii)       The Respondent is to pay the   Appellant’s costs of the   assessment in the sum of   $330.00 inclusive of GST.

(iii)      The Respondent is to pay the costs of the appeal.

BACKGROUND TO THE APPEAL

1. On 23 August 2005, Shashi Kanth Hassan Mallegowda (‘the Appellant’) filed an appeal against the Registrar’s ‘Assessment of Costs’ in relation to proceedings previously determined by a Commission Arbitrator.

1. The Respondent to the appeal is Collins Restaurant Management Pty Limited t/as Sizzler (‘the Respondent’). The relevant workers compensation insurer is QBE Workers Compensation (NSW) Limited (‘QBE’).

1. The appeal was served on the Respondent on 23 August 2005. On 5 September 2005 the Respondent filed a ‘Notice of Opposition to the Appeal’.

1. The Registrar’s decision (by her delegate, a Commission Arbitrator) made on 25 July 2005 is as follows:

“1.      Pursuant to an Agreement and Order dated 2 December 2004 the   Respondent Employer is liable to pay the Applicant’s costs of the   Application as agreed or assessed.

2.        The Applicant’s costs of the proceedings assessed in the sum of $200.00   (inclusive of GST) are determined as fair and reasonable.

3.        The Applicant’s costs of the assessment (inclusive of GST) are not allowed.

4.        The Respondent is to pay the amount of $200.00 to the Applicant if those   costs have not already been paid.”

1. An ‘Application to Resolve a Dispute’ was filed by the Appellant in the Commission on 12 November 2004 seeking weekly benefits compensation and medical, hospital or related expenses. That document was filed under cover of a letter from the Appellant’s solicitors dated 11 November 2004 addressed to the Registrar stating as follows:

“… The Respondent stopped paying weekly benefits and medical expenses … The Applicant and his wife has neither access to Medicare nor social security system [sic] and are in extremely financial difficulties[sic] to meet medical treatment expenses as well as living expenses … accordingly, we make Application for Expedited Assessment …”

1. It appears that that application was ultimately referred to the expedited assessment officer at the Commission and following discussions between the parties, an interim payment direction was issued by the Commission on 2 December 2004 together with an Agreement to Discontinue Proceedings duly executed by both parties.

1. The Appellant was successful in obtaining an interim payment direction. That direction noted that the parties had executed an Agreement to Discontinue Proceedings including the following term: “… The Respondent to pay the Applicant’s costs as agreed or assessed including the Agreement to Discontinue”. The order also confirmed that the Respondent was to pay the Applicant’s costs “… of the Application.”

1. In making an assessment of costs, the Registrar determined that Clause 1(2)(d) of Schedule 6 of the Workers Compensation Regulation 2003 (‘The Regulation’) applied so as to restrict the Appellant’s costs to $200.00 only.

1. The Appellant submits that the Registrar has made an error of law in determining that the interim payment order discontinued the ‘Application for Determination’ retrospectively, failed to make an assessment of costs in accordance with the Agreement to Discontinue Proceedings, erred in validating the Agreement to Discontinue Proceedings and erred in the interpretation of Clause 1(2)(d) of the Regulation.

1. The Respondent submits that the Appellant’s “substantial proceedings” were discontinued with the Interim Payment Direction orders, that the matter involving the “substantial proceedings” and the Interim Payment Direction is one and the same, and:

“… As the Applicant’s outcome was based on the interim payment application based on which the agreement for discontinuance was filed, the Applicant is not entitled to any further costs other than ordered by the Arbitrator in the sum  of $200.00 …”

1. It is also noted that the Respondent takes issue with the granting of leave to appeal on the grounds that the appeal does not meet the threshold requirements of section 352(2) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).

ON THE PAPERS REVIEW

1. No submissions have been made by the Appellant on this issue. The Respondent submits that the matter is suitable for a determination ‘on the papers’.

1. I have before me the Commission files in both the substantive matter and the cost dispute together with the parties’ submissions on appeal.

1. Having carefully read this material, I am satisfied that I have sufficient information to proceed ‘on the papers’ in accordance with the provisions of section 354 of the 1998 Act and Practice Direction No. 1, and that this is the appropriate course in the circumstances.

JURISDICTION

1. Part 19 of the Regulation provides for the determination of costs in matters before the Commission. Subdivision 5 of Division 4, Clause 119 provides as follows:

“119.   Appeal against decision of Registrar as to matter of law.

(1) A party to an application who is dissatisfied with a decision of the Registrar as to a matter of law arising in the proceedings to determine the application may, in accordance with the Rules of the Commission, appeal to the Commission constituted by a Presidential member against the decision.

(2)       The appeal is to be in the form approved by the Commission and be   accompanied by the fee approved by the Commission from time to   time.

(3)After deciding the question the subject to the appeal, the Commission constituted by a Presidential member may, unless it affirms the Registrar’s decision:

(a)       make such determination in relation to the application as, in   its opinion, should have been made by the Registrar, or

(b)       remit its decision on the question to the Registrar and order   the Registrar to re-determine the application.

(4)       On a re-determination of an application, fresh evidence, or evidence   in addition to or in substitution for the evidence received at the   original proceedings, may be given.”

1. The Workers Compensation Commission Rules 2003 (‘the Rules’) did not make any provision for the making of an appeal pursuant to clause 119 of the Regulation.

1. The Respondent made lengthy submissions as to why the Appellant failed to meet the threshold test set out in subsection 352(2) of the 1998 Act however, neither section 351 nor section 352 of that Act confer jurisdiction upon the Presidential Member to determine the matter. The reasons for this were succinctly summarised by Deputy President Fleming in Orr v Direct Couriers (Australia) Pty Limited [2004] NSWWCCPD 28 as follows:

·“The Determination was made by the Commission constituted by the Registrar, through her delegate (pursuant to clause 114 of the Regulation), not by the Commission constituted by an Arbitrator.

·The fact that the Registrar delegated her power, under Clause 114 to an Arbitrator does not alter the constitution of the Commission for the purpose of a determination of costs pursuant to clause 119. Sections 351 and 352 therefore are not applicable.

·This reasoning is supported by the terms of Clause 118 of the Regulation, which provides that:

‘The Registrar’s determination of an Application is binding on all parties to         the Application and no appeal or other review lies in respect of the            determination, except as provided in this Division.’

·In any event, I note that section 351 is applicable only as a matter of law that derives ‘in proceedings’ and in this matter the proceedings have been concluded by the determination. Section 352 does not permit an appeal from an Arbitrator only in relation to costs. (Sam Borg v Garnville Pty Limited [2003] NSWWCCPD 30)”.

1. For the reasons stated above, I am satisfied that I have jurisdiction to hear the appeal, pursuant to clause 119 of the Regulation, and leave to appeal is granted.

THE RELEVANT LAW

1. Clause 1(2)(d) of Schedule 6 of the Regulation provides as follows:

“(d)     Certain applications for expedited assessment. For an activity or event   carried out on behalf of a claimant or insurer in any of the following   circumstances:

(i)        The insurer failed to determine a claim for medical expenses   involving less than $5,000,

(ii)       The insurer fails to commence weekly payments of compensation   where less than 12 weeks’ compensation is sought by the claimant   and an interim payment order is made by the Registrar (whether or   not the interim payment order was sought by a party to the claim),

-          The cost set out in Column 3 of Part 3 of the table opposite that   activity or event up to the maximum total costs for that type of   activity or event set out in Column 4 of the table.”

1. The Registrar determined, at paragraph 14 of his ‘Statement of Reasons’ that:

“This matter resulted in the making of an Interim Payment Direction. The fact that it commenced by the filing of an ‘Application to Resolve a Dispute’ does not entitle the Applicant to any more costs than payable had an application been filed for an Interim Payment Direction”.

1. It was on this basis that the Registrar awarded costs in the sum of $200.00, being the amount applicable in Column 3 and 4 of Part 3 of the Compensation Costs Table (‘the Table”).

1. The activity or event is described in the Table as “Applying for expedited assessment to the Commission” and makes provision for payment of the sum of $200.00 to the Claimant’s legal practitioner or agent only, if “… the application results in the making of an interim payment order …”

1. In the present case, the Commission files reveal that, prior to the filing of the ‘Application to Resolve a Dispute’, QBE wrote to the Appellant on 27 September 2004 advising that “… ongoing liability has been denied … and that “… we are required to pay you wages upon receipt of an appropriate medical certificate until 11 October 2004. Following this time, no further wages will be paid.”

1. Following receipt of this letter and the obtaining of material and documents in support of the ‘Application to Resolve a Dispute’, that application was, ultimately received by the Commission on 12 November 2004 and registered on 16 November 2004.

1. Correspondence from the Respondent to the Commission dated 2 December 2004 notes that “a Reply was forwarded to the Workers Compensation Commission for filing and an unsealed copy served on the Applicant’s solicitors on 25 November 2004”. The Respondent’s solicitors went on to state that “… the insurer has provided satisfactory notice under section 74 of [the 1998 Act] that liability is disputed, and … the presumption to issue an interim payment direction is extinguished.”

1. Not withstanding that correspondence, an Interim Payment Direction was issued.

1. As noted previously, when filing the ‘Application to Resolve a Dispute’, the Appellant’s solicitors noted that the Appellant and his wife were not able to access either Medicare or Social Security benefits and on this basis sought “expedited assessment”.

1. The terms of Clause 1(2)(d) of Schedule 6 seem to me to be quite clear. The costs payable are in respect of “applying for expedited assessment to the Commission”. In other words, it is not necessarily commenced by the filing of an ‘Application to Resolve a Dispute’ and can be made independently. The section is not founded on a requirement that an ‘Application to Resolve a Dispute’ be filed. The payment is said to relate “… for an activity or event carried out on behalf of a claimant or insurer …” The ‘activity’ or ‘event’ is the making of the application for an expedited assessment.

1. In the present case, the Appellant’s solicitors made the application, by letter dated 11 November 2004, “… relying on the Statutory Declaration duly executed by the Applicant …” included in the ‘Application to Resolve a Dispute’. Considerable additional material was included in the application. It seems to me that the ‘activity’ or ‘event’ referred to in Clause 1(2)(d) of Schedule 6 relates to the correspondence making the application for expedited assessment and the obtaining of a Statutory Declaration or other necessary material to ground that Application.

THE SUBMISSIONS

1. The Appellant has also submitted that the ‘Application to Resolve a Dispute’ was filed “… because the Respondent not only refused to pay the Applicant worker correct weekly payments from 22 March 2004 to 16 November 2004, but also stopped weekly payments on 7 October 2004” thereby demonstrating further grounds for the necessity to file the Application.

1. Moreover, the terms of the Interim Payment Direction and the Agreement to Discontinue Proceedings are also pertinent to the Registrar’s determination as to costs. The Interim Payment Direction was in the following terms:

“The Commission:

1.        FINDS:

(a)       On the material contained in the file and, after discussions   with both parties, there is no evidence to justify the non   payment of weekly compensation or travelling expenses from                12 October 2004 to the date of this Interim Payment Direction a total

of 7.2 weeks.

(b)       It is noted that the Respondent has agreed to pay the   Applicant weekly compensation at the rate of $310.59 per   week from 20 March 2004 to 11 October 2004 with credit to   the Respondent for weekly benefits already paid, together   with outstanding section 60 expenses for medical expenses.

(c)It is further noted that the parties have executed an Agreement to

Discontinue Proceedings, namely the Application to Resolve a Dispute registered with the Commission on 16 November 2004, as and from 2 December       2004, the Respondent to pay the Applicant’s costs as agreed or assessed including the Agreement to Discontinue .”

2.DIRECTS:

(1)That the Respondent pay the Applicant … weekly compensation …

(2)That the Respondent pay the Applicant’s costs of the application.”

1. The direction included that the Respondent pay weekly benefits with a further direction “that the Respondent pay the Applicant’s costs of the Application.”

1. It can be seen by the terms of the Interim Payment Direction that it in fact exceeded the period described by Clause 1(2)(d)(ii) of Schedule 6 but in any event, the Interim Payment Direction effectively included two costs directions; firstly, “… The Respondent pay the Applicant’s costs as agreed or assessed including the Agreement to Discontinue” and secondly, “… that the Respondent pay the Applicant’s costs of the Application.”

1. It seems to me to be quite clear that the Respondent was ordered to pay the Appellant’s costs of the Application for the Interim Payment Direction but also to pay costs “as agreed or assessed” in connection with the ‘Application to Resolve a Dispute’, since those costs were expressed to include costs associated with the Agreement to Discontinue.

1. In my view, the terms of the direction are clear, and the Appellant is entitled to costs associated with the ‘Application to Resolve a Dispute’ in addition to costs associated with the Interim Payment Direction.

THE COSTS CLAIMED

1. The Registrar noted that both parties had made submissions in regard to the Bill of Costs dated 26 January 2005 and that “the Respondent puts in issue many of the charges made in the Bill.” However, as the Registrar then stated, “… in view of my assessment below in relation to Schedule 6 of Clause 1(2)(d) of the Regulation there is no need to deal with those specific objections.”

1. In view of my decision, the Appellant is entitled to certain costs associated with the ‘Application to Resolve a Dispute’. The Appellant seeks a total of $5,060.00 for costs and disbursements. The Respondent in its submissions before the Registrar claimed that the sum of $1,754.50 was appropriate. Having regard to both parties’ submissions, I make the following order in relation to the Appellant’s claim:

Column 1 Item No 2.01 2.04 2.05 2.06 3.01 4.01 4.02 4.05 4.09 4.12 TOTAL Column 2
Amount claimed $500.00 $600.00 $100.00 $500.00 $200.00 $300.00 $ 60.00 $500.00 $1000.00 $190.00 $3950.00 Column 3
Amount Allowed $500.00 $500.00 Nil $500.00 $200.00 $300.00 $ 60.00 $250.00 $250.00 $190.00 $2750.00 Column 4
Total $500.00 $500.00 Nil $500.00 $200.00 $300.00 $ 60.00 $250.00 $250.00 $190.00 $2750.00

1. The Appellant also seeks payment of a disbursement totalling $715.00 inclusive of GST from Mercantile Claims Service for the obtaining of a “… factual investigation interview with and statement of your above named client …” A disbursement such as this has been considered at length by Deputy President Fleming in Berger v Moree Plains Shire Council [2005] NSWWCCPD 152 and was disallowed. Whilst this case is the subject of appeal to the Court of Appeal, I accepted Deputy President Fleming’s reasoning in my decision of Moore v P M & J H Turner [2006] NSWWCCPD 110 and concluded that “the investigation report the subject of this appeal is no more than a ‘statement from the worker’.” In any event, as the Respondent points out, the report was not used in the proceedings and not served on the Respondent. It seems again to be nothing more than a fee for the obtaining of a statement from the worker and as such, there is no basis upon which it should be allowed.

1. The WorkCover Authority has determined that GST may be added to appropriate Items on the Bill of Costs, and the Appellant is entitled to GST.

CONCLUSION

1. The Registrar erred in his interpretation of the provisions of Clause 1(2)(d) of Schedule 6 of the Regulation and failed to take into account the parties’ agreement in relation to costs set out in the Interim Payment Order such that the Appellant is entitled to costs as set out in the table in paragraph 37 above.

COSTS OF THE ASSESSMENT

1. The cost of the costs assessment is covered by Item 9.01 of the Table and the amount allowed should be determined relative to the amount involved in preparing the Application for Assessment. In Brady v Moree Plains Shire Council [2005] NSWWCCC14 the Commission balanced the items that were in dispute in respect of which the Applicant succeeded as opposed to those in respect of which the Applicant failed. In that case, as the monetary value of the items gained by the Applicant were much less than the items lost by the Applicant, the Arbitrator ordered that each party bear its own costs of the assessment.

1. In the present case, the Applicant has obtained significant costs compared with those allowed by the Arbitrator such that I consider the amount of $300.00 appropriate in the circumstances.

DECISION

1. The decision of the Registrar dated 25 July 2005 is revoked and the following decision is made in its place:

(i)The Respondent is to pay the amount of $3,025.00 inclusive of GST to the Appellant.

(ii)       The Respondent is to pay the Appellant’s costs of the assessment in the sum of   $330.00 inclusive of GST.

(iii)      The Respondent is to pay the costs of the appeal.

Deborah Moore

Acting Deputy President

17 August 2006

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DEBORAH MOORE, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE