McLaughlan v Woodbrae Holdings Pty Limited
[2007] NSWWCCPD 105
•1 May 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS
CITATION:McLaughlan v Woodbrae Holdings Pty Limited [2007] NSWWCCPD 105
APPELLANT: Elizabeth Anne McLaughlan
RESPONDENT: Woodbrae Holdings Pty Limited
INSURER:GIO Workers Compensation (NSW) Limited
FILE NUMBER: WCC9289-05
DATE OF REGISTRAR’S DECISION: 21 September 2005
DATE OF APPEAL DECISION: 1 May 2007
SUBJECT MATTER OF DECISION: Costs
PRESIDENTIAL MEMBER: Acting Deputy President Robert Harrington
HEARING:On the papers
REPRESENTATION: Appellant: McCabe Partners lawyers
Respondent: Turks Legal
ORDERS MADE ON APPEAL: 1. The decision of the Registrar dated 21 September 2005 is revoked and the following decision is made in its place:
“(i) Pursuant to an order for costs made on 10 December 2004, the Respondent is liable to pay the Applicant’s costs as agreed or assessed.
(ii) The Applicants cost of the substantial proceedings are assessed in the sum of $9,317.35.
(iii) The Respondent to pay the Applicants costs of the assessment in the sum of $625.
(iv) The Respondent is, therefore, to pay the Applicant a total of $9,942.35.”
2. The Respondent to pay the Appellant’s costs of the appeal in the sum of $605.00 inclusive of GST.
THE APPEAL
On 13 October 2005 Elizabeth Anne McLaughlan (‘the Appellant’) filed an appeal against the Registrar’s assessment of costs in proceedings determined by a Commission Arbitrator.
The Respondent to the Appeal is Woodbrae Holdings Pty Limited (‘the Respondent’).
The Registrar’s decision (by her delegate, a Commission Arbitrator) made on 21 September 2005, is as follows:
“1.Pursuant to an order for costs made on 10 December 2004, the respondent is liable to pay the applicant’s costs as agreed or assessed.
2.The applicant’s costs of the substantive proceedings are assessed in the sum of $7,763.00
3.No order as to costs of the assessment.
4.The Respondent is, therefore, to pay the Applicant a total amount of $7,763.00 if those costs have not already been paid.”
BACKGROUND
The Appellant’s claim was for weekly compensation payments, lump sum compensation and medical expenses.
In 2002 the Appellant commenced proceedings in the Workers Compensation Commission (‘the Commission’) by filing an ‘Application to Resolve a Dispute’ (‘the first Application’). The Application matter number was WCC1131 – 02.
The first Application was referred to a Commission Arbitrator, who, on 26 March 2003 convened a telephone conference. Following the teleconference the Arbitrator made the following direction:
“1.That, with the consent of both parties, pursuant to Rule 19 of the interim Workers Compensation Rules this matter is set aside because medical reports showed the injury is not stable and the Weekly Payments Application is to be withdrawn.”
The reason that the Arbitrator made this direction was because the Respondent, in that teleconference, asserted that it had medical evidence that the Appellant’s condition was not stable, as such, her lump sum entitlement could not be assessed at that point in time.
The Appellant’s solicitor’s submissions which were before the Registrar’s delegate, indicates that the Arbitrator advised the Appellant solicitors that rule 19 did not nullify the proceedings. The Arbitrator further advised the Appellant solicitors that they would have to file in the Commision a new ‘Application to Resolve a Dispute’ and update the claim with supplementary medical evidence in support of the Appellant’s claim.
In 2004 the Appellant solicitors filed a second ‘Application to Resolve a Dispute’ (‘the second application’) in respect of the Appellant’s various claims for compensation. My understanding is that the claims made in the second application, were identical to the claims made in the first application. This application was issued with a matter number WCC 14899 – 04.
The Respondent filed in the Commission a ‘Reply to Application to Resolve a Dispute’ (‘Reply’). In that Reply the Respondent gave notice to the Appellant that they disputed the entirety of her claim.
The Appellant’s claim was referred to a different Arbitrator who convened a teleconference on 10 December 2004. At that teleconference the parties were able to settle the claim and the Arbitrator made the following orders and notations:
“1.The Respondent to pay an additional $10 weekly compensation for the period 29 April 2004 to 4 August 2004.
2. The Applicant discontinued her claim for s60 medical expenses (Rule 74).
3. The Respondent to pay the Applicant’s costs as agreed or assessed.
4.That the requirement to file a notice of the discontinuance pursuant to Rule 74 is dispensed with.
The following is not a determination of the Commission, however, I note that the parties have agreed the following:
That the parties file a s66A agreement in relation to s66/67 of the Workers Compensation Act 1987 with the Registry within 14 days, being for Permanent Impairment: 5% neck $2000; 5% left arm at or above the elbow $3750; 10% loss sexual organs $4700 and pain and suffering of $10,050: a total of $20,500.”
ON THE PAPERS
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(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, the documents that are before me, and the submission by the parties that the appeal can proceed to be determined on the basis of these documents, 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.
DISCUSSION AND FINDINGS
It is convenient to address the Appellant’s claims in the order in which they are set out in the Appellant’s written submissions on appeal. The appeal to a Presidential Member pursuant to Clause 119 of the Costs Regulation lies as to matter of law.
Errors of law
As I understand the Appellant’s first submission, the Appellant submits that the whole of the decision of the Registrar’s delegate is vitiated because of error of law. The error was a failure by the Registrar’s delegate, the Appellant submits, to consider and refer to the Appellant’s submissions before reaching his decision. I have read the Registrar’s delegate’s decision and the material that was before him including the Appellant’s submissions. It is clear, in my view that the Registrar’s delegate did refer to and consider the Appellant’s submissions. I find, therefore, that the Appellant’s first ground of appeal is not made out.
The failure to award costs for the work done in the first Application
The Appellant submits on appeal that the Registrar’s delegate erred in not awarding the costs associated with the first application. The Appellant submits in essence that the use of Rule 19 by the first Arbitrator to ‘suspend’ the Applicant’s claim because “medical reports show the injury is not stable” was, in the mind of the Arbitrator and the parties, to maintain the continuity of the proceedings and to ensure the work already carried out by the Applicant’s solicitors would be recompensed if the Appellant was successful in her claim. I believe there is merit to this argument, however, the fact remains that the second Application was a new proceeding, legally disconnected from the first proceedings. The Appellant obtained a costs order in respect of the second application only. In my opinion the Registrar’s delegate was correct in rejecting the Appellant’s claim for costs in respect of the first application, as there was no cost order in respect of that application. I find, therefore that the Appellant’s second ground of appeal is not made out. There is no doubt that the work performed by the Appellant’s solicitor in respect of the first application was relevant to, and used in the second application. In those circumstances, it is my view that the Registrar’s delegate should have made allowance for this work where it was appropriate, in respect of the costs he assessed for the second application. I have taken this work into account in determining the appropriate fee under item 2.06.
Item 2.02
The Appellant’s claim before the Registrar’s delegate was for $40.00 in respect of multiple ‘requests to the insurer’. The Registrar’s delegate correctly allowed the Appellant’s claim. However, when he made his determination he mistakenly recorded $20.00 instead of $40.00. This is clearly an error. It is reasonable, therefore, to allow $40.00 in respect of the claim under Item 2.02.
Item 2.04
The Registrar’s delegate made a finding that the Appellant had reviewed three medical reports under this item. The appropriate allowance in this circumstance would normally be $400.00. The Registrar’s delegate reduced the allowance to $375.00 as he was of the view that one of the reports was a ‘supplementary report’. The Registrar’s delegate made this deduction because he allowed costs in respect of Dr Andrew’s reports both under item 1.01 and under item 2.04. Having made an allowance for the Appellant’s costs for reviewing the doctor’s first report under item 1.01 the delegate was of the view that Dr Andrew’s subsequent report, which was allowed under item 2.04 could only be allowed on the ‘subsequent report’ rate of $75.00 rather than $100.00 for a primary report. I can see no legal error in this determination. Accordingly, the appeal in respect of item 2.04 does not succeed.
Item 2.06
The Appellant submits that the Registrar’s delegate was in error as he, in coming to his determination in respect of this item, took into consideration irrelevant material. Item 2.06 provides a fee for a solicitor requesting the insurer to make a reassessment of the claim. The Registrar’s delegate reduced the allowance under this item, because he noted that some of the requests for reassessment, related to the first application. Whether the request for reassessment was made in respect of the first application or the second application is, in my opinion, not relevant. The relevant question which must be asked in order to determine entitlement under this item is, were there requests made to the insurer to reconsider the claim prior to the commencement of the claim. The commencement of the claim, in my opinion was the issuing of the second application. Given the Registrar’s delegate having fallen into error, it falls upon me to reassess this item. The Appellant submits that she made three requests dated 28 March 2003, 30 May 2003 and 18 May 2004 to the insurer to review the claim. The purpose of the cost allowance under this item is to assist dispute resolution and avoid litigation. The Appellant’s first application which was discontinued would, in my opinion, in the circumstances fall within this category as a request to the insurer to review the claim. In the first application the Appellant supplied medical reports and details of the claim in the circumstances, I consider, therefore, the amount of $500.00 to be reasonable under item 2.06 and I make this allowance.
Item 4.03, 4.03A and 4.05
Before the Registrar’s delegate the Respondent submitted that there were no directions issued in the second proceedings. The Registrar’s delegate rejected the Appellant’s claim under these items for this reason. The Registrar’s delegate’s decision is patently incorrect as there were two directions issued in the second application. The Registrar’s delegate failed to give reasons in respect of the Appellant’s claim for costs, in respect of directions. The Registrar’s delegate also failed to consider relevant evidence which was before him. The Registrar’s delegate’s decision in respect of the Appellant’s claim for costs in respect of directions was erroneous. As such the Appellant’s entitlement under these items must be re-determined. The appellant’s entitlement under these items:
· Item 4.03: the Appellant requested the Commission issue two directions for the production of documents. The Appellant is entitled to $60.00 for the initial direction and $40.00 for the subsequent direction, making a total of $100.00. I therefore allow $100.00 under item 4.03.
· Item 4.03A: the Appellant having served two directions is entitled to $80.00 under this item. I therefore allow as reasonable $80.00 under item 4.03A.
· Item 4.03B: the Appellant provided $56.00 conduct money to the parties issued with a direction for productions. It would seem reasonable therefore to allow this expense. I therefore allow as reasonable $56.00 under item 4.03B.
· Item 4.05: the Appellant submits, on appeal, that they were required to review the files produced by GIO Workers Compensation (NSW) Ltd, the file produced by Woodbrae Holding propriety Ltd, documents produced by Dr Andrews, Dr Khalfan and documents produced by Mrs McLaughlan. The Respondent had, in their reply, placed in issue the entirety of the Appellant’s claims for compensation. In the circumstances, it was important that the documents that were produced be carefully considered. In the circumstances I consider it appropriate to allow $500.00. I therefore allow as reasonable $500.00 under item 4.05.
Item 4.08
The Registrar’s delegate allowed the maximum amount claimable under this item. There can be no further claim. Accordingly, the appeal in respect of item 4.08 does not succeed.
Item 10.01
The Registrar’s delegate rejected The Appellant’s claim for this item because there was “no direction for the production in the current claim”. This finding is wrong; the evidence discloses that the Appellant had issued two directions. It therefore falls upon me, to assess the Appellant’s entitlement in respect of this item. I consider the amount of $187.50 to be fair and reasonable, particularly given that the Appellant’s solicitor is a solicitor practising in country New South Wales. Therefore I allow as reasonable the amount of $187.50 under item 10.01.
Disbursements: medical reports
The Appellant claimed $2207.00 for medical report fees. The Registrar’s delegate allowed $1954. The difference between the claim and the allowance was the cost of obtaining the general practitioner’s (Dr Khalfan) report. Dr Khalfan charged $660.00 for his report which the Registrar’s delegate stated was above the scale. He reduced the allowance for the general practitioner’s report fee, to the $407.00. The Appellant’s submissions on appeal do not disclose any error of law in respect of this decision. Accordingly, the appeal in respect of disbursements for medical reports does not succeed.
Disbursements: investigator’s report
The Appellant claims $3693.22 in respect of an investigation and report. The investigation and report was carried out and supplied by St George Registration and Investment Service Pty Ltd. The Appellant’s submissions and documents establish that the investigation report was detailed and included a factual and liability summary report together with a seven page statement from the worker, a business name search, wage material and a detailed wage schedule. Of the $3693.22 claim, the Registrar’s delegate allowed $666.00.
Clause 82 of the Costs Regulation exempts “fees for investigators’ reports or other material produced or obtained by investigators (such as witness statements or other evidence)” from costs referred to by the relevant Part of the Costs Regulation. Accordingly it is necessary to go to The Legal Profession Regulations 2005 (‘the LP Regulation’) (see Berger v Moree Plains Shire Council [2005] NSWCCPD 152 at [56], [68] and [71], Asimus v J.J. Walker, A.D. Walker & Temple Pty Ltd t/as Templemore Partners [2006] NSWWCCPD 113 at [17] and [18]). Clause 113 of the LP Regulation provides:
“113 Prescribed costs for services in workers compensation matters—section 329 (1) (a) and (f) of the Act
(1) This clause applies to:(a)costs for legal services provided in any workers compensation matter, and
(b)costs for a matter, that is not lending service parties related to proceedings in any workers compensation matter.
(2) The fair and reasonable costs fixed for a legal service specified in Part 1, 2 or 3 of Schedule 3 are the costs specified in relation to that service in that Part, calculated in accordance with that Part.
(3) However, after calculating the costs for legal services specified in Parts 1 and 2 of Schedule 3, the total of all such costs is to be reduced by 10%.”
Schedule 3 Part 1 Item 10 of the LP Regulation provides:
“Any disbursement necessarily incurred is to be allowed except in so far as any such disbursement is of an unreasonable amount or has been unreasonably incurred and any doubts which the taxing officer/costs assessor may have as to whether any disbursement was reasonably incurred or was reasonable in amount are to be resolved in favour of the receiving party”.
There are therefore no costs governing the amount that can be recovered in respect of an investigation. The amount that the Appellant is entitled to recover is the amount which is assessed to be ‘fair and reasonable’. The Registrar’s delegate considered the amount of $660 to be fair and reasonable. The Registrar’s delegate provided reasons as to why he considered this amount to be fair and reasonable. The Appellant’s submissions on appeal do not disclose any legal error on the part the Registrar’s delegate. In my opinion, the Registrar’s delegate’s decision in respect of the fees for the investigation does not contain any error of law. Accordingly, the appeal in respect of fee for the investigation does not succeed.
Agency fees
The Appellant claims agency fees totalling $241.50. The Registrar’s delegate disallowed this claim and provided no reasons as to why this claim was disallowed. The failure to give reasons is an error of law. The Appellant’s solicitor practices in country New South Wales. He had issued two directions, and there was a direction issued to his client. In the circumstances, it would seem appropriate and reasonable to allow the disbursement in respect of the agency fee, in the sum of $241.50.
Costs of the Assessment Item 9.01
The Registrar’s delegate did not allow the Appellant costs of the assessment because “the applicant was not successful in this application”. This is not a correct statement of the outcome of the assessment. In respect of some items the Appellant did not succeed, however in relation to the overall assessment the Appellant succeeded in her claim. I am of the opinion that the Arbitrator erred in not allowing the Appellant’s costs. I consider it reasonable to allow $625.00 under item 9.01.
Summary
The assessment of costs as allowed on appeal are as follows:
Item Allowed by the Registrar’s delegate Allowed on Appeal 1.01 $600.00 $600.00 1.02 $100.00 $100.00 2.01 $500.00 $500.00 2.02 $20.00 $40.00 2.03 $40.00 $40.00 2.04 $375.00 $375.00 2.05 $100.00 $100.00 2.06 $250.00 $500.00 4.01 $300.00 $300.00 4.02 $100.00 $100.00 4.03 Nil $100.00 4.03A Nil $80.00 4.03B Nil $56.00 4.05 Nil $500.00 4.08 $500.00 $500.00 4.09 $375.00 $375.00 4.12 $190.00 $190.00 7.01 $120.00 $120.00 10.01 Nil $187.50 $3,570.00 $4,763.50 GST $357.00 $476.35 $3,927.00 $5,239.85 Disbursements Medical reports $1,954.00 $1,954.00 Agency fees Nil $241.50 Travel expenses $1,222.00 $1,222.00 Investigator $660.00 $660.00 $7,763.00 $9,317.35
DECISION
The decision of the Registrar dated, 21 September 2005 is revoked and the following decision is made in its place:
“1.Pursuant to an order for costs made on 10 December 2004, the Respondent is liable to pay the Applicant’s cost as agreed or assessed.
2.The Applicant’s costs of the substantive proceedings are assessed in the sum of $9,317.35.
3.The Respondent to pay the Applicant’s costs of the assessment in the sum of $625.00.
4. The Respondent is therefore, to pay the Applicant a total of $9,942.35.”
COSTS
The Appellant has been successful in her Appeal and it is appropriate that the Respondent pay the Appellant’s costs of the Appeal in the sum of $605.00 inclusive of GST.
Robert Harrington
Acting Deputy President
1 May 2007
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBERT HARRINGTON, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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