Nolan and Military Rehabilitation and Compensation Commission

[2008] AATA 948

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 948

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/5331

GENERAL ADMINISTRATIVE DIVISION		)
Re		BRIAN NOLAN

Applicant

And MILITARY REHABILITATION AND COMPENSATION COMMISSION

Respondent

DECISION

Tribunal Deputy President P E Hack SC and Dr M L Denovan, Member

Date23 October 2008

PlaceBrisbane

Decision The Tribunal orders that the respondent pay the applicant’s costs of and incidental to the proceedings to be taxed if not agreed.  

..............Signed.................

Deputy President

CATCHWORDS

COMPENSATION – costs to be awarded – whether costs should be limited to one day’s hearing – second day was necessary as a result of the respondent’s action – respondent ordered to pay applicant’s costs of and incidental to the proceedings

Safety, Rehabilitation and Compensation Act 1988 (Cth) – ss 67

Perry v Comcare (2006) 150 FCR 319

REASONS FOR DECISION

23 October 2008   Deputy President P E Hack SC and Dr M L Denovan, Member

1.On 30 September 2008 we made a decision, for the reasons then published[1], setting aside the reviewable decision of the respondent Commission and substituting a decision that the applicant, Mr Brian Nolan, had a degree of permanent impairment of 12%. We remitted the matter to the Commission to determine the amount of compensation payable and invited submissions from the parties within 14 days in relation to the costs of the proceeding.

[1]See [2008] AATA 870.

2.Those submissions have now been received, albeit that those from Slater & Gordon, the solicitors for Mr Nolan, were received outside the 14 day period. We propose to have regard to those submissions despite that default given that the submissions responded, within 14 days, to the submissions lodged on behalf of the Commission by its solicitors, Sparke Helmore.

3.Section 67(1) of the Safety, Rehabilitation & Compensation Act 1988 (Cth) (the SRC Act) sets out the prima facie rule that costs incurred by a party in proceedings are ordinarily borne by that party; however succeeding subsections provide a variety of circumstances where that rule is displaced. One of those circumstances is provided by s 67(8) of the SRC Act which confers discretion upon the Tribunal to make an order that the costs incurred by a claimant, or part of those costs, be paid by the responsible authority, in this case the Commission, where either of the circumstances postulated in the subsection are made out. The discretion is unfettered but must be exercised having:

“regard to the rule of primacy reflected in s 67(1), the circumstances of the case which gave rise to a decision enlivening the qualification upon s 67(1), the background circumstances concerning the claim, the nature and character of proceedings for the purposes of the SRC Act, the complexity of the claim and the conduct of the parties in relation to the proceeding.”[2] 

[2]        Perry v Comcare (2006) 150 FCR 319 at 339, [76].

4.There being no doubt that the discretion has been enlivened the Commission does not oppose Mr Nolan recovering part of his costs. It submits, however, that he ought not receive the costs of the second day of hearing having regard to the course of the hearing. This submission is put:

“on the basis that the Applicant [Mr Nolan] failed to get a report from their [sic] expert, Dr Scoppa, and if they had, we would not have needed an adjournment after the first day of Hearing.”[3]

[3]Letter Sparke Helmore to the Tribunal, 6 October 2008. 

To understand the basis on which that submission is put it is necessary to set out some detail of the background of the matter.

5.The starting point is the decision subject of the review by the Tribunal. By that decision the Commission determined that Mr Nolan was not entitled to compensation for permanent impairment because his hearing loss and tinnitus each constituted an injury and because neither yielded a whole person impairment of 10%. The delegate’s decision appears to have been informed by a view, expressed by a report from Dr Michael Zacharia, that Mr Nolan’s hearing loss was, at worst, 7.4%. That figure was based upon a pre-service loss of 2.9% and a post-service loss of 10.3%.

6.Mr Nolan’s case, as articulated in his Statement of Facts and Contentions[4], was that his pre-service hearing loss ought be disregarded, that his post-service hearing loss was 12% and thus he had a whole person impairment of 6%, and that his tinnitus attracted an impairment assessment of 5% leading to a combined impairment assessment of 11%. For its part the Commission’s case, as set out in its Statement of Facts and Contentions[5], sought to uphold the decision and the basis for it.

[4]        Exhibit 4.

[5]        Exhibit 5.

7.On 10 March 2008 Sparke Helmore engaged Dr William Coman, an ear, nose and throat surgeon, to report on Mr Nolan’s hearing loss. Additionally, he was asked to provide an opinion about whether tinnitus was a separate medical condition to hearing loss, a question evidently designed to elicit support for the Commission’s argument that Mr Nolan suffered two injuries.

8.Following a conciliation conference on 4 April 2008 the Tribunal sent hearing certificates to the parties on 7 April 2008. They were asked to return the certificates within 10 days. The hearing certificate of the Commission, returned on 21 April 2008, indicated that the Commission intended to call Dr Zacharia, whose reports were included in the documents lodged with the Tribunal pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) and would seek to cross-examine Mr Nolan and any other witnesses called on his behalf. No reference was made to an intention on the part of the Commission to call Dr Coman.

9.Mr Nolan’s hearing certificate, returned on 9 May 2008, indicated that it was not intended to call Mr Nolan as “it appears agreed between the parties that the only issues to be argued are legal issues”. That however prompted Sparke Helmore to write to Slater & Gordon on 15 May 2008 indicating that Mr Nolan was required to be available for cross-examination.

10.In the meantime, on 1 May 2008, the Tribunal notified the parties that the matter had been listed for hearing on 29 May 2008. On 22 May 2008 Sparke Helmore lodged in the Tribunal, and served on Slater & Gordon, a report from Dr Coman dated the previous day in which Dr Coman analysed the various hearing tests, determined the extent of Mr Nolan’s hearing loss and provided answers to the questions regarding the relationship between tinnitus and hearing loss. At the same time the Tribunal (and Slater & Gordon) were notified that Dr Coman would be unable to give evidence on 29 May 2008 as he would be travelling overseas. Despite this, Slater & Gordon initially pressed the requirement that Dr Coman be available for cross-examination.

11.On 23 May 2008 Slater & Gordon notified the Tribunal and Sparke Helmore, seemingly for the first time, of an intention to call Dr Joseph Scoppa, an ear, nose and throat surgeon. No report was provided and no indication was given in that correspondence of the evidence that it was anticipated that Dr Scoppa would give. It was foreshadowed that Dr Scoppa was only available from 2 p.m. on the day of hearing. That letter prompted a letter from Sparke Helmore of 27 May 2008 foreshadowing an objection to Dr Scoppa giving evidence “in the absence of a report”. Given that at that stage no indication had been given of the nature and extent of the evidence to be given by Dr Scoppa the objection appears somewhat ritualistic.

12.In any event, later on the same day Slater & Gordon set out in a letter to the Tribunal and to Sparke Helmore brief details of the evidence intended to be led from Dr Scoppa. It was said that he would give evidence to explain the process of conducting an audiogram and as to the proposition that tinnitus was not an injury separate to hearing loss, but a symptom of it.

13.The hearing commenced on 29 May 2008 and proceeded for approximately one hour when the matter was stood down until 2 p.m. for Dr Scoppa to be called. After his evidence in chief was given Mr Dubé, who appeared for the Commission, requested that the matter be adjourned to enable the Commission to seek a comment from Dr Coman on the evidence given by Dr Scoppa. That adjournment was not opposed and the hearing was adjourned.

14.Subsequently a further written report was sought and obtained from Dr Scoppa. His scrutiny of the hearing tests and the earlier reports revealed that the degree of post-service hearing loss had been wrongly calculated as being 10.3% and that it was, in fact, 16.3%. At the commencement of the resumed hearing on 5 September 2008 Mr Dubé indicated that the Commission accepted that the earlier calculation was wrong and that Mr Nolan had a post-service hearing loss of 16.3%. Hence what remained to be determined were the essentially legal issues identified in our earlier reasons for decision.

15.It is against this background that we need consider the Commission submission that Mr Nolan ought not recover his costs of the second day’s hearing. Whilst it is true, as is pointed out in the letter from Sparke Helmore to the Tribunal of 6 October 2008, that the need for a second day of hearing was occasioned by the absence of a report from Dr Scoppa, that was merely the immediate cause. What precipitated the calling of Dr Scoppa was the late service of the report from Dr Coman, intended to be relied upon by the Commission. The Hearing Certificate from the Commission made no mention of any intention to call Dr Coman. The Tribunal’s Guide to this jurisdiction makes the self-evident point that it is expected:

“that, in general, all evidence to be relied on at the hearing will have been identified during the pre-hearing process.”

Dr Coman had been engaged in early March 2008. It does not appear to us that the Commission ever identified an intention to rely upon evidence from Dr Coman. Certainly, no reference was made to him as a potential witness in the Commission’s hearing certificate and, in any event, his report was not made available until shortly prior to the hearing. We would have thought that, at least, the Commission’s hearing certificate ought to have indicated that a report had been sought, but not yet obtained, from Dr Coman and that the Commission might rely upon a report to be produced by him. Had that been done it is unlikely that the hearing would have been set down as such an indication would have contradicted the statement in paragraph 1 of the hearing certificate that the “case is ready to proceed to hearing”.

16.As it seems to us, it was the late service of the report from Dr Coman and the evidence proposed to be given of the relationship between tinnitus and hearing loss that prompted the engagement of Dr Scoppa which then occasioned the adjournment. In those circumstances we do not accept the Commission’s submission that Mr Nolan ought not recover his costs of the second day of hearing. We would order that the Commission pay Mr Nolan’s costs of and incidental to the proceedings, to be taxed if not agreed.  

I certify that the 16 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC and Dr M L Denovan, Member

Signed:         ........................Signed..............................................
  Jacqueline Woods, Associate

Determined on the basis of written submissions 
Date of Last Submissions        16 October 2008
Date of Decision  23 October 29008
Counsel for the Applicant         Ms S Scott-McKenzie
Solicitors for the Applicant        Slater and Gordon
Solicitors for the Respondent    Sparke Helmore