McGlynn v N Gebhardt & R Gebhardt
[2007] NSWWCCPD 37
•7 February 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS
CITATION:McGlynn v N Gebhardt & R Gebhardt [2007] NSWWCCPD 37
APPELLANTS: Therese Fay McGlynn on behalf of the late Timothy Gordon McGlynn and John Leslie Purtell on behalf of Courtney and Jack McGlynn
RESPONDENT: N Gebhardt & R Gebhardt
INSURER:QBE Workers Compensation (NSW) Limited
FILE NUMBER: WCC9037-05
DATE OF REGISTRAR’S DECISION: 28 February 2006
DATE OF APPEAL DECISION: 7 February 2007
SUBJECT MATTER OF DECISION: Appeal against the Registrar’s Assessment of Costs: Various Items in Schedule 6 of the Workers Compensation Regulation (2003); Death claim; whether additional feels allowed for joining of two dependant children represented by the Public Trustee; disbursements and costs.
PRESIDENTIAL MEMBER: Acting Deputy President Deborah Moore
HEARING:On the papers
REPRESENTATION: Appellant: McCabe Partners Lawyers
Respondent: QBE In-House Legal
ORDERS MADE ON APPEAL: 1. The Registrar’s determination of the Appellants’ claim for costs in this matter, dated 28 February 2006 is amended in accordance with these reasons.
2. The Respondent, N Gebhardt and R Gebhardt is to pay the Appellants $687.50 (inclusive of GST) in respect of their costs of the assessment.
3. No order as to costs of the appeal.
BACKGROUND TO THE APPEAL
On 17 March 2006 Therese Fay McGlynn on behalf of the late Timothy Gordon McGlynn and John Leslie Purtell on behalf of Courtney and Jack McGlynn (‘the Appellants’) filed an ‘Appeal Against a Cost Determination’ made by the Registrar of the Workers Compensation Commission (‘the Commission’) on 28 February 2006. The Respondent to the appeal is N Gebhardt and R Gebhardt (‘the Respondent’). The Respondent’s insurer is QBE Workers Compensation (NSW) Limited (‘QBE’).
No submissions have been filed by the Respondent in opposition to the appeal.
Therese Fay McGlynn on behalf of the late Timothy Gordon McGlynn commenced proceedings in the Commission on 3 June 2004 against the Respondent seeking weekly benefits compensation in respect of three children, Christopher Timothy McGlynn, Courtney Jane McGlynn and Jack William McGlynn together with a lump sum death benefit as a result of the death of Timothy Gordon McGlynn in a motor vehicle accident in the course of his employment on 23 February 2004.
In its Reply filed on 14 September 2004, the Respondent stated that liability was not in dispute in that the lump sum benefit in the sum of $285,750.00 had already been paid to the Public Trustee. The Respondent conceded that the children Courtney McGlynn and Jack McGlynn were totally dependant for support on the deceased and were entitled to weekly payments. The only issue in dispute was the dependancy of the eldest child Christopher McGlynn and the question of apportionment of the lump sum between the claimed dependants.
Following a Teleconference on 14 September 2004, the Arbitrator directed that the then Applicant, Therese McGlynn: “… Formally enjoin the Public Trustee to the proceedings within four days in respect to the youngest sons [sic].”
As a consequence of that direction, Ms McGlynn’s solicitor filed an ‘Application to Join a Party to the Proceedings’ on 23 September 2004 naming “Najiv Azzi of the Public Trustee NSW on behalf of Courtney Jane McGlynn and Jack William McGlynn” as the additional party.
Following a conciliation/arbitration hearing on 21 October 2004 a ‘Certificate of Determination’ with an accompanying ‘Statement of Reasons – Extempore Orders’ was issued. The determination of the Commission was as follows:
“1. That the Respondent pay interest on the sum of $285,750.00 in the sum of $986.42, such sum to be paid to the Applicant.
2. That the Respondent pay the Applicant’s costs as agreed or assessed and the costs of the dependant children as agreed or assessed.”
The “Applicant” identified on the ‘Certificate of Determination’ was “Therese Fay McGlynn and Others”.
At a further conciliation/arbitration hearing on 28 January 2005, the parties, with the assistance of the Arbitrator, were able to come to an agreed resolution as to the appropriate apportionment of the lump sum death benefit.
No further orders in relation to costs were made on that ‘Certificate of Determination.”
On 10 June 2005, the parties having failed to agree on the costs payable, the Appellants’ solicitor filed an ‘Application for Assessment of Costs’ with the Commission. The Appellants effectively filed two Applications for Assessment of Costs, each dated 9 June 2005 in respect of the two “Applicants”. There were two submitted Bills of Costs, each dated 28 October 2004 and each setting out certain claimed Items under the Compensation Costs Table in Schedule 6 of the Workers Compensation Regulation 2003 (‘the 2003 Regulation’). Submissions were filed by the Respondent on 7 September 2005.
The Registrar delegated the ‘Assessment of Costs’ to a Commission Arbitrator (‘the Delegate’) who made a determination dated 28 February 2006. The ‘Certificate of Determination’ identified the parties in the following terms:
“Applicant: (1) Therese Fay McGlynn
(2) John Leslie Purtell (on behalf of Courtney and Jack McGlynn)
Respondent: R & N Gebhardt”
The Registrar’s Determination was as follows:
“1. Pursuant to an order of 21 October 2004, the Respondent employer is liable to pay the Applicant’s costs of the proceedings as agreed or assessed.
2. The Applicant’s costs of the proceedings are assessed at $7,880.28.
3. The Applicant’s costs of the assessment are not allowed.
4. The Respondent is to pay the amount of $7,880.28 to the Applicant if those costs have not already been paid.”
The relevant aspects of the Delegate’s ‘Statement of Reasons’ for his decision will be dealt with below.
ON THE PAPERS REVIEW
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) states:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Numbers 1 and 6 and the documents before me, neither party having made any submission on this issue, I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
SUBMISSIONS, DISCUSSION AND FINDINGS
Although some Items in the Compensation Costs Table (‘the Table’) of the 2003 Regulation are in dispute, the principle issue taken by the Appellant’s solicitor is the Delegate’s failure to allow additional costs in circumstances where there were effectively two Applicants in the proceedings.
The Delegate made the following comments in his introduction to the assessment:
“5. Costs are in the discretion of the Commission (s.341 of the Workplace Injury Management and Workers Compensation Act 1998).
6.S.341 is concerned with by whom, to whom, to what extent, and on what basis costs are to be paid. S.337, on the other hand, is concerned with the amount of costs payable and gives a regulation making power to fix maximum costs for legal and related costs. Clause 99 of [the 2003 Regulation] requires the ‘entitlement’ to costs to arise ‘as the result of an order’ by a Court or the Commission. On assessment, the quantification of the amount of costs recoverable is governed by that Regulation. Specifically, Clause 84 provides that the only costs recoverable are set out in Schedule 6 except as otherwise provided in Part 19.
7. Initially, proceedings were commenced on behalf of Therese Fay McGlynn (‘TM’) on behalf of the late Timothy Gordon McGlynn, arising from the road accident death of the latter on 23 February 2004. This Applicant TM took the proceedings at that point initially for weekly compensation (wife and three (3) siblings) and for lump sum death benefits under the Act. The first Application (1), which is analysed in its itemised format further in paragraph 8, deals with this TM Application.
On 21 September 2004, an Application to join an Additional party was filed, in the same proceedings, enjoining Courtney Jane McGlynn and Jack William McGlynn (children under 18 years), these latter proceedings – Application (2) – brought by the next friend or Executor on their behalf in the name of John Leslie Purtell (‘the JP Application’).
The claims arose out of the one incident and, as in the normal course of such matters, continued obviously as the one set of proceedings, as stated under WCC reference 8792-2004. The (various) Arbitral Orders (including Consent Orders) in the proceedings evidence and affirm the singularity of the proceedings conduct by reference to the commonality of description of the ‘Applicant’ under the tile of ‘Therese Fay McGlynn and Others’. Other than for the initial enjoinder of the JP Application parties, the proceedings (from that point) had the same chronology.
After an Arbitration on 21 October 2004, (amongst other Orders) the Arbitrator determined for a sum of $285,750.00 plus interest payable by the Respondent in favour of the four (4) dependant Applicant parties (by this stage all dependants encapsulated within the proceedings). There was an Order for costs as agreed or assessed in favour of the Applicant (globally). On 28 January 2005, the Arbitrator made additional Consent Orders, noted as ‘reissued Orders’ as to the (agreed) apportionment between the dependant Applicants, of the sum (as above) previously determined.
As stated, the Applicant’s legal representative has chosen to (effectively) put in two (2) separate assessment Applications, one with respect to each of the JM [sic TM] and JP elements, although the costs were globally awarded and singularly spring from the one set of proceedings. However, as the Applicant’s representatives have chosen to present the matter for assessment in that fashion, for ease of following these Reasons, they will deal with each of the discrete assessment Applications as submitted and following strictly the format as submitted, and under the identified references below.”
Thereafter the Delegate went on to assess what he described as: “Applicant (1): The TM Assessment Application”, after which followed his “Applicant (2), the JP Assessment Application”.
In brief, all Items in relation to professional costs claimed by the Appellant’s solicitor in respect of “Applicant (2): The JP Assessment Applicant” were disallowed by the Delegate essentially on the basis that the claims had already been allowed and could not be made twice. The Delegate allowed travel expenses only for “Applicant (2)”.
In his submissions on appeal, the Appellants’ solicitor accepts much of the determination made by the Delegate in relation to “Applicant (1): The TM Assessment Application”. Costs remaining in dispute are identified as follows:
Professional Costs
Item Amount Allowed Amount Sought Difference
_________________________________________________________________________
Item 4.05 $250.00 $500.00 $250.00
Item 4.08 (14.9.04) $250.00 $500.00 $250.00
Item 4.08 (21.10.04) $250.00 $500.00 $250.00
Item 10.01 $Nil $187.50 $187.50
Professional costs $937.50
GST $93.75
Total costs in dispute: $1,031.25
Disbursements
Description Amount Allowed Amount Sought Difference
_________________________________________________________________________
Agency Fees $Nil $264.00 $264.00
As to the determination in respect of “Applicant (2): The JP Assessment Application” the following Items have been identified as being in dispute by the Appellant’s solicitor:
Professional Costs
Item Amount Allowed Amount Sought Difference
__________________________________________________________________________
Item 4.01 $Nil $300.00 $300.00
Item 4.02 $Nil $100.00 $100.00
Item 4.08 $Nil $500.00 $500.00
Item 4.10 $Nil $1500.00 $1500.00
Item 4.12 $Nil $380.00 $380.00
Item 7.01 $Nil $120.00 $120.00
Item 10.01 $Nil $187.50 $187.50
Professional costs $3,087.50
GST $308.75
Total costs in dispute: $3,396.25
Disbursements $526.58 $714.20 $187.62
In summary, the Appellants’ solicitor claimed in relation to “Applicant (2): The JP Assessment Application” costs associated with lodging an ‘Application to Resolve a Dispute’, service of that Application, preparation for conference, attending and participating in proceedings before the Arbitrator, and all work associated with the registration of an agreement under Section 66A of the Workers Compensation Act 1987 (‘the 1987 Act’).
The claims were disallowed by the Delegate essentially because they had been claimed in the “Applicant (1): The TM Assessment Application” and could not be claimed twice.
For example, in relation to the claim under Item 4.01 with respect to “Applicant (2): The JP Assessment Application” the Delegate made the following comments:
“Claimed for ‘Lodging with commission [sic]’ at $300.00, the Table maximum. The Applicant refers here to a ‘filing’ date of 3 June 2004. This is a curious claim and a curious chronology. The ARD for the initial TM dispute proceedings has already been allowed for 13 June 2004. These are the same proceedings. The ‘Application to Join’ (reference this JP Assessment Application) was by the Applicant’s own acknowledgment, only made on 21 September 2004 so this claim cannot be for that activity either (in any event, it is not a qualifying activity under 4.01 which is an Application for ‘resolution’ of a dispute, not otherwise). In any event, further, maximum costs attach to the event/activity in the Table for a ‘claim’ made in respect of a particular injury, not (inherently as the Applicant suggests) for each time the event or activity is claimed. It is reiterated that here there are the one set of proceedings only (even on ‘joinder’ of extra parties, this happened three (3) months after this chronology Item claim here) (Orr v Direct Couriers (Australia) Pty Limited [2004] NSWWCCPD 28). This is essentially the nature of the Respondent’s objection. Disallowed. Further, under Schedule 6 Clause 2(1), if the ‘additional’ dependant JP claim is said to be or comprises ‘more than one claim’ activities with respect to ‘multiple claims’ cannot exceed the maximum allowances in Column 4. Here, clearly, there is the one set of proceedings and the one set of Orders, encapsulating all. Table maximums cannot in circumstances in this presentation or generally, be exceeded. Hereafter, including encapsulating the global objections claimed for a number of Items by the Respondent, the reasons where applicable as parallel, are noted simply as ‘already claimed and allowed’”.
The Delegate then went on to deal with each of the Items claimed, disallowing them as ‘already claimed and allowed’.
The Delegate made reference to Clause 2(1) in Schedule 6 of the 2003 Regulation which deals with “multiple claims or disputes in respect of an injury to be treated as a single claim or dispute.” Clause 2(1) is in the following terms:
“In the event that more than one claim is made in respect of the particular injury, or more than one dispute arises in respect of a claim, the maximum total cost for a type of activity or event in respect of the injury, regardless of how many times the activity or event is carried, is the maximum set out in Column 4 of the table in relation to that type of activity or event.”
Certain exceptions apply as set out in Clause 2(2), relevantly Clause 2(2)(c) as follows:
“The Commission or the Registrar orders that the claims or disputes are to be treated as separate claims or disputes for the purposes of a calculation or assessment of costs.”
In the present case, the Arbitrator at first instance directed that the Appellants join the Public Trustee to the proceedings as represented by John Leslie Purtell on behalf of the children Courtney and Jack McGlynn. On one view of the matter, that direction could be seen to imply that the “claims or disputes” were to be treated as “separate claims or disputes”. However, that does not appear to be a view taken by either party or indeed the Arbitrator and the direction was not expressed to be “… For the purposes of the calculation or assessment of costs.”
In my view, the proper course to be adopted by the Appellants in relation to the assessment of costs was to seek payment, in relation to the “Applicant (2) the JP Assessment Application,” pursuant to the provisions of Clause 5 of Schedule 6 of the 2003 Regulation. That Clause is in the following terms:
“5.If more than one insurer (or any combination of insurers) is a party to a claim or a dispute or other matter in relation to a claim, the maximum costs in respect of the matter are the total of the following:
(a) The costs for the matter calculated in accordance with the table,
(b) 50% of that amount per party (other than the party who made the claim),
and payment of the costs is to be shared equally among the insurers who are parties to the matter.”
It is noted that Clause 81 provides that in Part 19 (costs) and Schedule 6 and 7, the term insurer includes an employer.
In WCC16889-05, Julie Duetoft v WorkCover Authority of NSW, the delegate, in dealing with the Application of Clause 5 costs stated: “The terms of Clause 5 are such that the word ‘insurer’ is treated as interchangeable with the word ‘party’.” The delegate then stated: “In addition the WorkCover Authority of NSW is an entity which indemnifies claims against uninsured employers and in that capacity must be considered to be an insurer for the purposes of the Act and the Regulation.”
However, in matter number WCC13289-05 Robert Dunn v Richard Weber and WorkCover Authority of NSW, the delegate stated:
“Quite simply, there was not more than one insurer party to the claim. There was in fact no insurer at all. The first Respondent employer was uninsured, and the WorkCover Authority is not an insurer … Clause 5 does not therefore apply in this matter and I therefore disallowed the claim.”
This approach was rejected by the delegate in matter number WCC15738-04 Alliston v WorkCover Authority of NSW & Ors, a determination of 20 December 2005. In that case, the delegate again stated that: “The terms of Clause 5 are such that the word ‘insurer’ is treated as interchangeable with the word ‘party’ such that the WorkCover Authority must be considered to be an insurer for the purposes of the Regulation. The delegate made the following comments:
“If the intention of the legislature was to exclude the WorkCover Authority from the provisions of Schedule 6 then there would have been a special exemption written into the legislation. The WorkCover Authority for example can recover costs from an Applicant in circumstances where the Applicant had brought proceedings which were fraudulent or unreasonably incurred were frivolous or vexatious. The authority would be entitled to make a claim against an Applicant on these grounds including the incremental cost of joining additional insurers or parties to such proceedings. To interpret the Clause as disabling the authority from prosecuting Costs Order would prejudice the rights of the Administrator to recover costs from any party and in particular from uninsured employers.”
As a consequence, the delegate allowed the claim: “for an increment by the Applicant.”
Applying similar reasoning, it seems to me that, in circumstances where the Arbitrator directed that an additional party be joined to the proceedings, it is appropriate that an increment be allowed for additional work required.
It is clear from the proceedings the subject of the determination by the Arbitrator at first instance that there are three parties to the proceedings, ie, two “Applicants” and one “Respondent”. Thus I am of the view that an ‘uplift fee’ is the appropriate mechanism by which the Appellants ought be awarded additional costs in relation to the additional “parties” to the proceedings.
It follows then that in my view, the Delegate’s determination of the costs claimed in “Applicant (2): The JP Assessment Application” was correct in relation to professional costs since the individual Items had already been claimed and allowed.
I should note at this point that the Delegate allowed $526.58 claimed as a disbursement for “Applicant travel”. On appeal, the Appellants simply state: “Amount claimed - $714.20”. In the Bill of Costs described by the Delegate as “Applicant (2): The JP Assessment Application”, a claim was made for travel expenses apparently in respect of Mr John Purtell totalling $526.58. This was allowed by the Delegate. The only other disbursement claimed in that Bill was for “barrister’s fees”, disallowed by the Delegate. Nowhere is there claimed an additional $187.60 on top of the $526.58 allowed by the Delegate. Thus, I would confirm the Delegate’s decision in relation to the claim for disbursements relative to “Applicant (2): The JP Assessment Application”.
Turning now to the Items in dispute in relation to “Applicant (1): The TM Assessment Application”, I will deal with each of those in turn as follows:
Item 4.05
This is described in the Table as “Reviewing documentation produced under a direction of the Commission, exchanging information with the other parties and obtaining further instructions from client.” The amount allowed is $250.00 per hour, up to a maximum of $500.00. The Appellants claimed $500.00 and the Delegate allowed $250.00 stating as follows:
“The Respondent is prepared to concede $250.00. I am not prepared to accept in the circumstances of the matter that there was a two hour claimable component here, including additional two other allowances already made and conceded. I allow the Item but in the reduced component of $250.00.”
No basis was provided by the Respondent in its submissions before the Delegate as to why the sum of $250.00 only should be allowed, although it is noted that the Respondent at all times confirmed that “liability was not denied in this matter”. In submissions on appeal, the Appellants’ solicitor claims that documents were produced by the Respondent, the Roads & Traffic Authority, the NSW Police Force and two other parties.
The Appellants’ solicitor maintains that he is entitled to $500.00 but his submissions essentially address the issue of “apportionment”. None of the documents to which the Appellants’ solicitor refers in his submissions on appeal would have had any relevance to those issues.
In the circumstances, and particularly in light of the absence of any issue as to liability, the Delegate’s assessment is appropriate and is confirmed.
Item 4.08
The Appellants’ solicitor claimed a maximum of $500.00 in respect of conferences on 14 September 2004 and 21 October 2004. The Delegate allowed $250.00 in respect of each conference, a total of $500.00.
This Item was also considered in some detail by ADP Handley in Harvey v JJC Group Pty Limited [2005] NSWWCCPD 329 (‘Harvey’) where he said:
“In Orr v Direct Couriers (Australia) Pty Ltd [2004] NSWWCCPD 28 (‘Orr’), Deputy President Fleming discussed the application of column 4 of the Table in Schedule 6. Column 4 bears the heading “Maximum total for type of activity/event”. With reference to clause 1(2) of Schedule 6, the heading for column 4, and the NSW Court of Appeal decision in Orellana-Fuentes v Standard Knitting Mill Pty Ltd (2003) 57 NSWLR 282 (‘Fuentes’), the Deputy President said, at paragraph 38:
“The monetary values set out in Column 4 of the Table, are the maximum total for an event type in any particular claim, regardless of the number of individual activities that may take place under the event heading.”
Thus, in respect of Items 4.08, the legal practitioner may not be allowed more than the column 4 maximum regardless of the number activities/events of that type. (However, as Deputy President Fleming recognised in McManus, there is an exception in respect of Item 4.12 where, following Fuentes, the column 4 maximum of $190 may be allowed in respect of each conference or conciliation/arbitration.)”
In these circumstances, the Appellant’s claim for a total $1000.00 is disallowed, and the Delegate’s decision totalling $500.00 is confirmed.
Item 10.01
This Item is described in the Table as: “All work associated with instructing an agent to act on the claim or a matter relating to the claim.” The maximum allowed is $187.50.
In McManus v Gosford City Council [2004] NSWWCCPD 61, Deputy President Fleming, in considering Item 10.01 said this:
“The issue of the agent’s fees was discussed in the matter of Dunn ... Item 4.05 of the Compensation Costs Table has already been claimed, and allowed, at a maximum of $500.00. To also allow the claim under Item 10.01 is to effectively allow for the same activity, by a legal representative and an agent, to be claimed twice. This is not permitted by the Regulations.”
In the present case, the Appellants’ solicitor claimed the maximum amount under this Item. It was disputed by the Respondent and the Delegate disallowed it on the basis that allowance had already been made under Item 4.05.
In line with the authorities to which I have referred, I see no error in the Delegate’s determination that this Item ought to be disallowed.
Disbursements
The only disbursement identified in dispute by the Appellants’ solicitor is a claim for agency fees in the sum of $264.00. This disbursement was disallowed by the Delegate. The claim was for fees for St George Registration and Investigation Services (‘St George’) essentially for filing, inspection and photocopying.
In disallowing the claim, the Delegate made reference to his comments relative to Item 10.01 and said as follows:
“There is no basis for an assertion here of a claim for ‘legal professional privilege’ pertinent to this matter, nor for documentary inspection already given proper allowance at Item 4.05 and within other Table allowances already conceded and as assessed here. The claim for ‘agency’ intrusion is also not properly made with reference to the appropriate definition for a representative agent within s.356(6) of the 1998 Act. Disallowed.”
I have perused the account from St George. I can see no error in the Delegate’s reasons for disallowing this Item, and his decision is confirmed.
Clause 5 Costs
Having confirmed the Delegate’s primary assessment of costs and disbursements allowed, I turn now to the application of Clause 5 of Schedule 6.
The application of this Clause was considered at length by Deputy President Fleming in Dunn v Port Macquarie RSL Club Limited [2004] NSWWCCPD 33 where she said as follows:
“As with other provisions in Schedule 6, Clause 5 refers to ‘maximum costs’. ‘Maximum costs’ are not always incurred, not should they be awarded in every case. An award of costs is relative to the work performed and are not based upon a maximum award regardless of whether the activity or event has actually been carried out, or carried out to the full extent of the time that attracts the ‘maximum amount’ that may be awarded. The Registrar’s discretion in relation to an application to determine costs payable as a result of an order made by the Commission is contained in Clause 110 of the Regulation. This directs the Registrar to consider:
(a) Whether or not it was reasonable to carry out the work to which the costs relate, and
(b) What is a fair and reasonable amount of costs for the work concerned. “
Deputy President Fleming concluded:
“In my view, the Registrar has an overriding discretion to award costs in accordance with what is fair and reasonable for the work performed. When considering the application of Clause 5 of Schedule 6 of the Regulation the ramifications for the costs incurred, in joining multiple insurers, must be taken into account.”
In the present case, additional work was required following the Arbitrator’s direction at the Teleconference on 14 September 2004. In my view it was appropriate for the Appellant’s solicitor to then seek “independent advice”, as it were, with respect to the two “Applicants”. Irrespective of the involvement of barristers (whose fees are not claimable under the 2003 Regulation) it was fair and reasonable for the Appellants’ solicitor to be required to undertake additional work by way of consultation and advice with the respective parties.
Having regard to these matters and the circumstances of this particular case, I am satisfied that it would be fair and reasonable to allow an additional 25% in respect of costs incurred in the proceedings relative to the additional “Applicant”.
GST
The Appellants’ solicitor claimed GST in respect of his assessment of costs. It was disallowed by the Delegate who stated as follows:
“The Applicant claims GST on the total claimed for Item costs in the Bill. Costs regulation by Schedule 6 are expressed to be the ‘maximum costs that are recoverable’ (Clause 84 of the Regulation). There is no provision that expressly allows GST to be awarded in addition to the ‘maximum costs’ allowable in the Table. GST on Clause 82 costs (for example, disbursements allowed on assessment) may be added pursuant to Clause 115 of the Legal Profession Regulation 2005. Consequently, there is inherently no power on the Assessor as Delegate of the Registrar to make an allowance of GST for Table Item costs awarded on assessment under the Compensation Costs Table; although, equally, GST as incurred on assessed Clause 82 disbursements is allowable (Berger v Moree Plains Shire Council [2005] NSWWCCPD 152 especially at paragraphs 153 – 160).”
In matter number WCC447-06 Josephine Bridge v ANZ Banking Group Limited, the delegate considered a claim for GST. The delegate noted that the Workers Compensation Amendment (Costs in Compensation Matters) Regulation 2006 came into operation on 17 March 2006 which allows for a claim for GST on costs. The delegate noted that: “Prior to the amendment, the decision of Berger provides that GST is not payable on regulated costs.”
The delegate made the following observations:
“As GST is a tax levied upon a service or supply, it is not ascertainable or incurred until the value of the service or supply is determined. In relation to legal costs, the liability for GST arises upon agreement as to costs or assessment of costs. In the present case, liability for GST arises at the date of assessment, which is after the regulation amendment. Accordingly, the provisions of the amending regulation apply and GST is payable on the Applicant’s costs.”
I am of the same view in relation to this particular matter, insofar as, where additional costs have been awarded pursuant to Clause 5 of Schedule 6 of the 2003 Regulation, those costs could not have been properly determined until conclusion of the appeal.
There has been no change to the Delegate’s primary assessment of professional costs. They were assessed on 28 February 2006, prior to the amending legislation, and therefore, GST is not allowed on those costs.
Accordingly, to the Delegate’s Assessment of Costs of $7,880.28 should be added a further 25%, $2, 167.07 ($1,970.07 plus GST of $197.00), giving the total amount of costs assessed as $10,047.35 inclusive of GST.
CONCLUSION
The Delegate’s determination to disallow professional costs in the Bill he described as “Applicant (2): The JP Assessment Application” on the basis that they have been ‘claimed twice’ was correct. The Appellants’ solicitor in my view ought properly to have claimed an allowance for additional work pursuant to the provisions of Clause 5 of Schedule 6 of the 2003 Regulation.
The Delegate’s primary determination as to costs allowed in the matter is confirmed. I have determined that to that amount must be added a further 25% ($1970.07 plus of GST of $197.00) to give a total of $10,047.35 inclusive of GST.
DECISION
The Delegate’s determination of the Appellant’s claim for costs in this matter dated 28 February 2006 is amended in accordance with these reasons.
COSTS
The Appellants claim costs of the assessment before the Delegate and of the appeal.
As to costs of the assessment, the Delegate stated as follows:
“The Applicant submitted as to costs of assessment in respect of the assessment Applications under reference ‘9.01’ including at $500.00 with respect to each of the assessment Applications. I am not prepared to allow, in the circumstances of this presentation, any costs of assessment and none are allowed.”
In submissions on appeal, the Appellants’ solicitor claims that his Bill of Costs was forwarded to QBE on 26 October 2004. The Appellants’ solicitor claims that no Reply was received and accordingly an Application for Assessment was made on 10 June 2005. I note from the Commission files that QBE responded by letter to the Registrar of the Commission dated 7 September 2005. No particular submissions were made in that letter from QBE other than to identify amounts it would agree to or deny.
In the absence of any submissions on appeal by the Respondent or QBE, I am not able to verify the assertions made by the Appellants’ solicitor however, the nature and content of the letter from QBE dated 7 September 2005 suggests that it was indeed a ‘first response’ to the Appellant’s Bill of Costs.
In all these circumstances, I am of the view that the Appellants’ solicitor is entitled to costs of the assessment pursuant to Item 9.01 in the sum of $687.50 (inclusive of GST).
As to costs of the appeal, the Appellant’s solicitor has been successful only to the extent that I have reviewed the application of Clause 5 of Schedule 6 to the circumstances of this particular case and found it appropriate to award additional fees in respect of additional work undertaken relative to the two “Applicants”. The Delegate’s primary assessment however is confirmed, and in those circumstances, I make no order as to costs of the appeal.
Deborah Moore
Acting Deputy President
7 February 2007
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.
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