Moloney T/A Moloney & Partners v Workers Compensation Tribunal & Anor [2011] HCATrans 25

[2011] HCATrans 25

[2011] HCATrans 025

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Adelaide  No A22 of 2010

B e t w e e n -

PETER NICHOLAS MOLONEY T/A MOLONEY & PARTNERS

Applicant

and

WORKERS COMPENSATION TRIBUNAL

First Respondent

ATTORNEY‑GENERAL FOR THE STATE OF SOUTH AUSTRALIA

Second Respondent

Application for special leave to appeal

GUMMOW J
CRENNAN J
KIEFEL J

TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO ADELAIDE

ON FRIDAY, 11 FEBRUARY 2011, AT 12.26 PM

Copyright in the High Court of Australia

__________________

MR H.A.L. ABBOTT, SC:   May it please the Court, I appear for the applicant.  (instructed by Moloney and Partners) and MR M.G. EVANS, QC appears with MR D.J. MACKINTOSH for the second respondent.  (instructed by Crown Solicitor (SA))

GUMMOW J:   There is no appearance for the Tribunal, I think.

MR ABBOTT:   The intervener, I beg your pardon, your Honour.

GUMMOW J:   I wanted to ask you about that.  Have you not misconstituted this application?  Was not the Attorney‑General an intervener below?

MR ABBOTT:   Yes.

GUMMOW J:   Well, that made him a party.  Just a minute, that made him a party.  You are obliged to join as respondents in this Court the parties below, and you did not join in.  So is not the appropriate order, which we cannot at the moment see how you can resist it, one joining the Attorney‑General as the second respondent without this motion that has been put on by the Attorney.

MR ABBOTT:   Yes, your Honour.

GUMMOW J:   Very well.  So the proceeding will be amended so that the first respondent becomes the Workers Compensation Tribunal and the second respondent is the Attorney‑General for South Australia.  Now, we would be assisted to hear first from the Attorney’s counsel, I think.

MR EVANS:   Your Honours, this is not an appropriate vehicle for a granting of special leave.  The question which has been raised is the validity of rule 31(2), a rule which was made under the workers compensation legislation in South Australia.  The rule deals with the question of costs of representation, in particular, the costs as between the worker and his own representative.  There are a number of reasons, in my submission, why it is not inappropriate. 

The factors which I would ask the Court to take into account in considering the appropriateness of this matter for a grant are firstly, that the Act itself has, and central to it, the creation of a Workers Compensation Tribunal, and in relation to that Workers Compensation Tribunal, it – in Part 6 and Part 6A of the Act – makes specific provisions in relation to various types of costs that may be dealt with by the Tribunal.  The Court can see those in section 95 and section 95A in particular of the Act.  Those provisions are set out in the judgment of her Honour Justice Layton at pages 10 and 11 of the application book.

Your Honours will see the first point, which is unique, is that the costs that the Act deals with are not costs just of solicitors.  They are not just of legal practitioners.  They are costs of representation.  The representation may be by a non‑legal representative, for example, an officer or employee of an industrial association.  The Court will see that from section 95(2), which refers to:

legal practitioner or an officer or employee of an industrial association –

and your Honours will also see that in 95A, where it refers to “Costs liability of representatives”, and it refers to “professional representative” and says that that means –

a legal practitioner or other person who has been engaged or appointed to a represent a party to proceedings before the Tribunal -

In my submission ‑ ‑ ‑

KIEFEL J:   I am sorry, I am just missing this.  What is the relevance of sections 95 and 95A to the rule‑making power of the President?

MR EVANS:   It indicates it was the intention of Parliament – in my submission, it informs the powers in relation to the rule making, as intended by Parliament, because there is a need for the Tribunal, as part of its practice and procedure, to have rules in relation to costs, not just of lawyers, but also of, for example, employees of industrial associations who represent workers ‑ ‑ ‑

KIEFEL J:   Section 95 deals with the costs orders that might be made by the Tribunal.

MR EVANS:   They do.  That is correct, your Honour.

KIEFEL J:   What we are concerned with here though is whether or not a rule which limits or affects the contractual relationship between a worker and their legal advisor is within the rule‑making power of the President.

CRENNAN J:   In that context you have to look, do you not, at section 88G?

MR EVANS:   Section 88G needs to be taken into account.  With respect, I accept that, and the submission put below was that the effect of section 88G was that that was the way in which Parliament intended to fix costs of a representative in relation to the costs incurred by, with respect, the party but ‑ ‑ ‑

KIEFEL J:   Section 88G(1) limits the quantum that a representative of a party might charge to the scale.  That is a not unusual provision.

MR EVANS:   No, that is correct, your Honour.

KIEFEL J:   But here, if there is to be – rule 31(2) goes further than that, does it not?

MR EVANS:   Rule 31(2) does.

KIEFEL J:   And if it does, it falls for consideration under section 88E(1)(f), that is to say, whether or not it is an exercise of the power to regulate costs and the focus then is upon what costs the section is referring to.

MR EVANS:   Quite, and in my submission, the regulating costs, when one looks at the structure of the Act and the structure of the Tribunal and the types of costs that the Tribunal is in a position to award, requires costs within section 88E(1)(f) to be read not just as what has traditionally been referred to as party/party costs or the costs as between parties, but also solicitor and own client costs, although here it is not solicitor, it is broader than that.  That can be seen by reference to sections 95 and 95A, with respect, the use of the word “costs” in both of those sections.  As an example, in 95A, there is a power in 95A(2) for the Tribunal:

If a professional representative acting for a party to proceedings . . . has caused costs—

(a)to be incurred improperly or without reasonable cause -

then under subsection (3):

the Tribunal may order—

(a)that all or any of the costs between the professional representative and his or her client be disallowed –

So the Act is dealing with costs not just in relation to party/party costs, but also specifically with costs in relation to “own representatives” costs and, in those circumstances, in my submission, there is no reason why the use of the word “costs” in 88E(1)(f), that is, “regulating costs”, cannot extend to costs -both the solicitor/client and the party/party.  In fact, one can see there would be a need for certain rules to deal with both types of costs.  Section 95A, in my submission, makes that plain.

The real question is, with respect, whether in dealing with costs in the way that the Tribunal has dealt with them in rule 33(2), whether those rules are confined to the same field of operation, as it were, as that marked out by the Act itself and in my submission they are confined to that same field.  That is supported – and one can see that by the reasoning of her Honour Justice Layton in the court below – both by the Hansard second reading speeches which her Honour there referred to, the objects of the Act, and the specific provisions within the Act itself.  Her Honour also referred to the fact that these costs are costs which are not just costs of solicitors. 

If we look at the scheme in South Australia of the Workers Compensation Tribunal and appearances before it, and the compensation of workers within that Tribunal, the intention is that it is meant to be – according to the Hansard and according to the objects of the Act – cost effective and efficient and we are dealing with vulnerable workers who Parliament does not intend, in my submission, on a plain reading of the Act, to be awarded a small amount of compensation, be ordered party/party costs by the Tribunal pursuant to section 95, and then perhaps be subject to losing all of their compensation because a solicitor or another representative may charge them more than what they recover from the compensating authority.

CRENNAN J:   But Parliament has provided for a regulation power for precisely those costs in section 88G.

MR EVANS:   And has not passed any regulation in relation to it, yes, but that is only putting an upper limit.  That is not, in my submission, inconsistent with a rule such as rule 33(2) and of course all the rule does is – it does not say you cannot charge more than you have recovered from the compensating authority.  It says that if you are to, you must get the authorisation of the Tribunal.  In my submission, that sits consistently with 88G. 

Of course, in considering that rule, one also has to consider that the legislation is unique in that it provides the costs to be paid under section 95,

win, lose or draw and so the representative gets an order for costs and can have the order made directly to them under section 95(4), which, in my submission, again supports the intention of Parliament in relation to the rule‑making power of that having a broad interpretation and justifying the rule that has in fact been made in this situation.

My friend in his outline has suggested that there is a conflict between the decision of the Full Court in South Australia and the decision – my friend indicates that he withdraws that submission and does not suggest that there is a conflict between the two.  In my submission, this is beneficial legislation.  The rule‑making power should be interpreted broadly.  The rule that has been made, in my submission, is necessary and appropriate for the purpose of the legislation. 

The legislation itself in various means has already abrogated what is the normal common law right or an individual’s right to contract separately as to what they charge for representation and, in my submission, this does not alter the substantive law.  It is procedural, and authority needs to be obtained from the Tribunal before those costs are allowed.  In my submission, it is consistent with the rule‑making power.

GUMMOW J:   Yes, thank you, Mr Evans.  Mr Abbott, your draft notice of appeal at page 26 in statement of the grounds is rather terse, is it not?

MR ABBOTT:   Yes, I am sorry about that.  Does your Honour want more specificity now about that?

GUMMOW J:   Just a minute.

KIEFEL J:   What are you intending to say, that there was no power to make rule 31(2), or it is beyond power.

MR ABBOTT:   Yes, it is beyond power because if section 88G and the work it has to do is properly understood, this rule is clearly beyond power.  If one looks at the history of the Act, one sees that for 80 years the legislature ‑ ‑ ‑

GUMMOW J:   We do not need to hear you any more, Mr Abbott.  There will be a grant of special leave in this matter, which would be a half‑day appeal, I think, gentlemen.

MR ABBOTT:   Yes.

GUMMOW J:   But you do need to be a little more forthcoming in your notice of appeal grounds, so you have leave to supplement the statement of the grounds appearing at page 26 of the draft notice.

MR ABBOTT:   May it please the Court.

GUMMOW J:   We will now adjourn until Tuesday, 1 March at 10.15 am in Canberra.

AT 12.43 PM THE MATTER WAS CONCLUDED