Scammell & Co v WorkCover Corporation - [2006] SASC 258

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Case Stated)
SCAMMELL & CO v WORKCOVER CORPORATION & ANOR
[2006] SASC 258
Judgment of The Full Court
(The Honourable Justice Nyland, The Honourable Justice Sulan and The Honourable Justice Layton)
23 August 2006
WORKERS' COMPENSATION - MISCELLANEOUS MATTERS
PROFESSIONS AND TRADES - LAWYERS - LIENS
Case stated to the Full Court - Law Society of SA intervening - Whether a solicitor's lien for costs can arise in respect of work undertaken in the Workers Compensation Tribunal - Whether conciliation process 'legal proceedings' - Whether the Worker's Rehabilitation and Compensation Act excludes any entitlement of a solicitor to claim a lien for payment from the Compensation Fund -Whether the lien extended to the costs in respect of a related Industrial Court matter - Held: The conciliation proceedings constituted legal proceedings in respect of which the plaintiff could claim a particular lien - There is a difference between the equitable right to secure a lien and the right to enforce a lien - The Act purports to modify a solicitor's right of entitlement and recovery from the Compensation Fund for a particular lien from an amount of weekly compensation otherwise payable to the Worker, and limits the right to an award for costs to that under s 95(4) - The plaintiff had a right to a particular lien for the sum of "$350 and reasonable disbursements to be agreed or taxed" from the Compensation Fund in accordance with para 3 of the Tribunal orders, - but, that right did not include any costs in relation to the Industrial Court Action.
Supreme Court Rules 1987 r 72.01; WorkCover Act 1994 s 12; s 13; Workers Rehabilitation and Compensation Act 1986 s 2(1)(a); s 30A; s 32; s 35; s 36; s 38; s 46; s 48; s 49; s 50; s 51; s 52; s 53; s 64; s 89; s 90; s 90A; s 91; s 92; s 92A; s 92B; s 92C; s 92D; s 94(b); s 95; s 119; Part 6A; Workmen's Compensation Act 1932 s 36, s 58; Workmen's Compensation Act 1971-1974 s 41; s 57; Workers Compensation Tribunal Rules 2001 R 28 (7a) (7e); Worker's Rehabilitation and Compensation (Dispute Resolution) Regulations 1996 Regs 7(1); 7(2), referred to.
Ex parte Paitence; Makinson v The Minister (1940) 40 SR (NSW) 96; Worrell v Power & Power (1993) 46 FCR 214, applied.
Firth v Centrelink (2002) 55 NSWLR 451; Hewitt v Court (1983) 149 CLR 639; Jacobs v Onesteel Manufacturing Pty Ltd & WorkCover Corporation of SA (2006) 93 SASR 568; Johns v Cassel [1993] FLC 92-364; Mitsubishi Motors Australia Ltd v Kowalski (2004) 236 LSJS 101; North West Construction Co Pty Ltd (in liq) v Marian [1965] WAR 205; Patterson v Cohen [2005] NSWSC 635; Potter v Minahan (1908) 7 CLR 277; Re Jalmoon Pty Ltd [1986] 2 Qd R 264; Re: A Barrister and Solicitor (1979) 40 FLR 26; Roam Australia Pty Limited v Telstra Corporation Ltd [1997] FCA 980; Stephenson Nominees Pty Ltd v Official Receiver (1987) 16 FCR 536; Welsh v Hole (1779) 1 Doug KB 238; Thompson v Australian Capital Television Pty Ltd (1994) 54 FCR 513; Twigg v Keady (No 2) (1997) 142 FLR 342; Hewitt v Court (1983) 149 CLR 639; Bennett & Co v CLC Corp (2001) 23 WAR 344; Bolster v McCallum [1966] 2 NSWR 660; Bropho v State of Western Australia (1990) 171 CLR 1; Cade Pty Ltd v Thomson Simmons (No 2) (2000) 211 LSJS 49; Campbell v Campbell & Lewis [1941] 1 All ER 274; Coco v The Queen (1994) 179 CLR 277; Color Point Pty Ltd v Markby's Communication Group Pty Ltd [1998] FCA 1516, considered.

SCAMMELL & CO v WORKCOVER CORPORATION & ANOR
[2006] SASC 258
Full Court: Nyland, Sulan and Layton JJ

NYLAND J: I agree with the reasons of Layton J, and I agree with the answers to the Special Case which she proposes.
SULAN J: I agree with the reasons of Layton J, and I agree with the answers to the Special Case which she proposes.
LAYTON J: The parties to this matter have obtained leave pursuant to r 72.01 of the Supreme Court Rules 1987 in stating a special case for the opinion of the Full Bench of this Court. The Special Case in general terms raises three questions, namely:
·whether a solicitor’s lien for costs in respect of work undertaken on behalf of a client in a Workers Compensation Tribunal (“the Tribunal”) matter can arise having regard to the nature of the proceedings in the Tribunal;
·whether the Workers Rehabilitation and Compensation Act1986 (“the WR&C Act”) requires that compensation payments determined to be payable to a worker can be paid by the Compensation Fund to a solicitor to satisfy a solicitor’s lien or as may be specifically authorised by the Worker;
·whether the solicitor’s lien asserted to be satisfied from compensation payments determined to be payable to a worker, extends to include costs in respect of an Industrial Court matter.
Specific Questions
Specifically, the questions to be determined by this Court are:
1. whether the Notice of Dispute lodged with the Tribunal by the plaintiff in respect of the decision of 3 February 2005 and/or the commencement of the WCT Action pursuant to Part 6A of the 1986 Act constituted legal proceedings in respect of which the plaintiff could claim the particular lien.
2. whether in any event the plaintiff had at any material time, and to any, and if so, to what extent the particular lien over moneys recovered by the Worker pursuant to paragraph 2 of the WCT orders.
3. whether in the alternative, the plaintiff did at any material time, and to any, and if so, to what extent have the particular lien over the moneys recovered by the Worker and, if so whether on its proper construction under the circumstances, section 95 of the 1986 Act limited that particular lien to the moneys recovered by the Worker pursuant to paragraph 3 of the WCT Orders and then only to the extent that those costs relate to the WCT Action (and not the IC Action).
Background to the Special Case
The Special Case filed on 12 December 2005 by the plaintiff, Scammell & Co (“the plaintiff”) sets out the approved facts. The plaintiff was represented by counsel, Mr David Howard. The defendant, WorkCover Corporation of South Australia (“the defendant”) was represented by Mr Phillip McNamara QC. The intervener to the action, The Law Society of South Australia was granted leave to intervene by order of a Master of this Court on 30 November 2005 to the extent of making submissions on the answers to the special case, but that it would bear its own costs. Mr Jonathan Wells QC appeared for the intervener.
Scammell is a partnership of legal practitioners who was instructed by Dr Tatiana Pyvovarenko (“the Worker”) to act for her in relation to an alleged disability arising from her employment as a scientific officer at Gribbles Pathology Ltd (“Gribbles”).
The alleged disability was said to have arisen some time in October 2001 as a result of her employment at that time with Gribbles. The alleged injuries included, “anxiety/depression, stress related disorder” due to “work overload, psychological harassment and verbal abuse”. The claim was said to arise on the basis that the Worker was harassed and abused by her superior; and was expected to increase her workload without associated wage increases under the relevant Enterprise Agreement.
On or about 10 September 2004, the Worker gave notice to Gribbles of the alleged work injury pursuant to s 51 of the WR&C Act and submitted a claim for compensation under s 52 of the WR&C Act.
On 21 September 2004, the Worker instructed the plaintiff in relation to her claim for compensation under the WR&C Act (“the Tribunal Action”) and also a claim in the Industrial Court against Gribbles for underpayment of wages pursuant to an Enterprise Bargaining Agreement applicable to the Worker (“the Industrial Court Action”). The Worker entered into a written fee agreement and retainer for the provision of legal services associated with her claims. The agreement read as follows:
AGREEMENT –LEGAL COSTS-MISCELLANEOUS
I, Tatiana Pyvovarenko HEREBY ACCEPT AND AGREE:
1.To the fees and charges referred to in this Agreement and in particular to the Costs Schedule attached to this Agreement.
2. To the 10% to cover the GST tax thereon.
3.To SCAMMELL & CO acting as my agent for the purposes of obtaining a barrister’s Opinion or obtaining other experts reports.
4.I AUTHORISE AND INSTRUCT SCAMMELL & CO to withdraw from funds held on my behalf in their trust account, monies to pay any outstanding fees and charges owing by me to Scammell & Co.
5.I AUTHORISE AND INSTRUCT Scammell & Co to pay any accounts on my behalf, where Scammell & Co are acting as my agent and to reimburse Scammell & Co for any expenses and disbursements incurred by Scammell & Co in connection with my affairs with them Scammell & Co are acting as my agent or as principal together with all GST applicable or occurred by Scammell & Co.
6.TO PAY any account rendered by Scammell & Co to me within 14 days. I understand that if any account remains outstanding for a period of 28 days, Scammell & Co may refuse to continue to act for me in this matter until the account is paid.
After obtaining instructions, the plaintiff began pursuing the Worker’s compensation claim by undertaking enquiries, and obtaining and providing medical reports to the Claims Agent, Allianz Australia Workers Compensation (SA) Limited, (“the Claims Agent”).
On or about 21 September 2004, the plaintiff also instituted proceedings against Gribbles in the Industrial Court on behalf of the Worker for underpayment of wages. The particulars of the claim indicate that the Worker alleges that she had not been paid as a Grade Two Scientist since the beginning of her employment and she was entitled to $120,000 as underpayment of wages.
On 3 February 2005, the Claims Agent determined the Worker’s claim for compensation under s 53 of the WR&C Act. The Worker’s claim was rejected on the basis that the alleged injury did not arise as a consequence of her employment; the employment was not a substantial cause of her injury; it arose from reasonable administrative action and therefore her alleged injury was not compensable under s 30A of the WR&C Act.
The Proceedings before the Tribunal
On 11 March 2005 the plaintiff lodged a Notice of Dispute on behalf of the Worker under s 90 of the WR&C Act in the Tribunal in respect of the 3 February 2005 decision of the Claims Agent refusing the Worker’s claim. On 22 March the Claims Agent in its capacity as the relevant compensating authority, pursuant to s 91 of the WR&C Act, reconsidered the claim and the 3 February 2005 decision was confirmed. A letter advising the plaintiff of the outcome was received on 24 March 2005 and read as follows:
I advise that pursuant to the provisions of the Workers Rehabilitation and Compensation Act 1986, the Notice of Dispute filed herein on 11/03/2005 has been reconsidered and the decision confirmed. The matter has now been referred to a Conciliation and Arbitration Officer.
On the instructions of the Worker, between 11 March 2005 and 15 March 2005, the plaintiff pursued the Worker’s claim and prepared for a compulsory conciliation conference under the WR&C Act. The conciliation conference was listed for 17 June 2005.
In the meantime the claim for underpayment of wages proceeded in the Industrial Court and judgment was delivered by Industrial Magistrate L J Farrell on 19 May 2005.[1] Findings were made by the Court to the effect that the Worker had certain entitlements to be paid as a Grade Two Scientist at certain periods of time when the work she was undertaking attracted a higher classification under the particular Enterprise Agreement. The matter was adjourned to 27 May 2005 to enable the parties to calculate the quantum of those entitlements and the precise weekly rate of pay in the light of the Magistrate’s reasons for decision.
[1] [2005] SAIRC 37.
On 14 June 2005, and before the Tribunal conciliation conference was to be held in the Tribunal Action, the Worker terminated her instructions with the plaintiff in relation to both the Tribunal Action and the Industrial Court Action. In a letter dated 13 June 2005, the Worker indicated that she was terminating the retainer with the plaintiff to act as solicitor in relation to the “Underpayment of Wages and WorkCover matters”. As at the date of terminating the retainer, neither the Tribunal Action nor the Court Action had been finalised.
The plaintiff rendered an account on 30 June 2005 for costs and disbursements for work done in relation to the Tribunal Action and the Industrial Court Action totalling $39,969.28.
On 17 June 2005,[2] the Tribunal Action, was resolved by agreement between the Worker and the Claims Agent and consent orders were made by the Tribunal. These orders were as follows:
1. The decision of the compensating authority dated 3 February 2005 is set aside.
2.The worker suffered a compensable disability in the course of her employment with the employer, namely a stress-related illness on 1 September 2004 (hereinafter called “the disability”) in consequence of which and subject to the provisions of the Commonwealth Social Security Act 1991 as amended and the Health & Other Services (Compensation) Act 1995 as amended:-
(a) the compensating authority pay pursuant to Section 32 of the Act all reasonable medical and like expenses incurred by the worker as a result of the disability as agreed by the parties or failing agreement as are assessed by the Tribunal on a further consideration of the question;
(b) the compensating authority make to the worker weekly income maintenance payments at a rate as is assessed by the Tribunal on a further consideration of the question from 1 September 2004 to the date of this order or until the same shall be discontinued, reduced, increased, suspended or redeemed in accordance with the provisions of the Act.
3.The worker is entitled to costs of the proceedings fixed at $350.00 and reasonable disbursements, to be agreed or taxed.
[2] Action No 1621/2005.
By reason of the consent orders and its obligations under the WR&C Act the defendant was liable to pay the costs and payments referred to in [2] and [3] of the consent orders “to the worker”. An amount of compensation, including $23,855.53 comprising arrears of income maintenance was the quantum due to be paid pursuant to s 35 of the WR&C Act.
On 30 June 2005 a letter was sent by facsimile by Scammell & Co to the Claims Agent of the defendant claiming:
[A] lien for our costs and out of pocket expenses over Dr Pyvovarenko’s back payments of income maintenance and also over a claim she is pursuing in the Industrial Relations Court.
The amount of the lien claimed was $39,969.28 being a composite of invoices and included disbursements for counsel fees. The account does not appear to make any adjustment for the $350.00 costs ordered in [3] of the orders of 17 June 2005. The letter of 30 June 2005 also referred to a telephone conversation the day before between the parties, indicating a claim for a lien would be made.
On 30 June 2005 the plaintiff also provided a letter by facsimile to the Worker indicating that they “maintain a lien over any award of underpayment of wages and back payment of income maintenance”. The plaintiff further indicated that “[i]f either WorkCover or Gribbles Pathology should pay funds to you without taking into account our lien, they would be at risk of having to pay our lien separately”. The plaintiff referred to the Costs Agreement and retainer signed by the Worker and the plaintiff on 21 September 2004 and in accordance with that paragraph, enclosed with the letter details of the lien and the invoices.
On 8 July 2005 the defendant paid directly to the Worker the sum of $16,077.38 comprising $15,483.53 (being the sum of $23,855.53 less tax for arrears of income maintenance) and interest of $593.85. This payment was made by the defendant with knowledge of the plaintiff having given notice of their claim for a lien for recovery of their costs of both the Tribunal Action and the Court Action.
It is agreed in the Special Case that, at the date of payment to the Worker, the Claims Agent and WorkCover both believed that:
25. … failing to make payment of the sum of $16,077.38 directly to the Worker had a material risk of:
25.1   exacerbating the Worker’s compensable disabilities;
25.2   increasing the financial hardship the Worker was already experiencing;
25.3 increasing the obligations of the defendant to the Worker;
25.4   impeding the effective rehabilitation of the Worker; and
25.5   delaying the Worker to return to work.
It is agreed that $39,969.28 remains unpaid.
Overview of submissions of the Parties
The submissions of both the plaintiff and the intervener contended that a particular lien applied and that it was not abrogated by the WR&C Act. Further, the intervener contended that as it was necessary to review the Worker’s entitlements to wages by invoking the jurisdiction of the Industrial Court, then the solicitor’s lien necessarily extended to the costs incurred in the Industrial Court Action.
The plaintiff argued that on 17 June 2005, being the date the Tribunal Action resolved, and at all material times thereafter, it was entitled to claim the lien over the sum of $23,855.53 which the defendant was otherwise liable to pay the Worker as income maintenance, for the costs of both the Tribunal Action and the Industrial Court Action. Alternatively, that the lien was limited to that part of the sum of $39,969.28 which represented costs and disbursements payable to the plaintiff in respect of the Tribunal Action after excluding the costs of the Industrial Court Action.
The defendant rejects the assertion by the plaintiff that it had a lien over the $23,855.53 essentially on three main grounds. First, that the Tribunal Action did not constitute legal proceedings nor did it result in an adjudication giving rise to the particular lien. Secondly, that the defendant had a statutory obligation to pay the sum to the Worker and this took priority over any equitable lien of the plaintiff. Thirdly, that the costs and out of pocket expenses claimed by the plaintiff with the exception of $3,187.80, related to work performed and expenses incurred in relation to the Industrial Court Action not the Tribunal Action and therefore could not be paid out of the sum payable to the Worker from the Tribunal Orders.
In order to consider the particular questions raised by the special case stated, I will discuss them under the following broad headings.
·Does the plaintiff have a particular lien for solicitors’ costs and disbursements?
·Does the WR&C Act abrogate recovery of a particular lien for solicitors’ costs?
·Are costs and disbursements of the Industrial Court Action included in the particular lien?
Does the plaintiff have a particular lien for solicitors’ costs and disbursements?
Nature of particular lien
This question requires consideration of a number of aspects of the nature of a solicitor’s lien for costs in the context of proceedings in the Tribunal. The specific lien claimed in this case is a particular lien as distinct from a general or retaining lien. Without digressing into the nuances of the distinction between the two types of liens, in short a retaining lien is a possessory lien, and is a right which enables a solicitor to retain, for example, items in possession such as the file of a client as a protection for unpaid work,[3] or money which comes into the hands of the solicitor.[4]
[3] Bolster v McCallum [1966] 2 NSWR 660; Bennett & Co v CLC Corp (2001) 23 WAR 344.
[4] Welsh v Hole (1779) 1 Doug KB 238.

A particular lien refers to an equitable right which a solicitor has to enforce payment[5] of legal costs and disbursements. In the words of Jordan CJ in the Full Court in Ex parte Patience; Makinson v The Minister[6] a particular lien arises:
as the result of legal proceedings in which the solicitor has acted for the client, the client obtains a judgment or award or compromise for the payment of money, although the solicitor acquires no common law title to his client’s right to receive the money or to any part of that right, he acquires a right to have his costs paid out of the money, which is analogous to the right which would be created by an equitable assignment of a corresponding part of the money by the client to the solicitor. That is to say, the solicitor has an equitable right to be paid his costs out of the money; and if he gives notice of his right to the person who is liable to pay it, only the solicitor and not the client can give a good discharge to that person for an amount of the money equivalent to the solicitor’s costs.[7] (emphasis added)
[5] Roam Australia Pty Limited v Telstra Corporation Ltd [1997] FCA 980, Ex parte Patience; Makinson v The Minister (1940) 40 SR (NSW) 96, 101; Firth v Centrelink (2002) 55 NSWLR 451, [35]; Patterson v Cohen [2005] NSWSC 635, [2] – [5].
[6] (1940) 40 SR (NSW) 96.
[7] Ex parte Patience; Makinson v The Minister (1940) 40 SR (NSW) 96, 100 citing Welsh v Hole (1779) 1 Doug KB 238.
The term “lien” is commonly used, although unlike a retainer lien, it is a non-possessory right and arguably not truly a lien.[8] As it is frequently so called, and for simplicity I will continue to refer to it as a particular lien.[9]
[8] Ex parte Patience; Makinson v The Minister (1940) 40 SR (NSW) 96, 100 – 101 also see discussion in Firth v Centrelink (2002) 55 NSWLR 451, 467.
[9] Following the approach of Deane J in Hewitt v Court (1983) 149 CLR 639, 668 and the Full Court of the Federal Court in Worrell v Power & Power (1993) 46 FCR 214.
A further matter to note is that case law and other authorities have confirmed that a particular lien of a solicitor on a judgment:
…is merely a claim to the equitable interference by the Court to have that judgment held as security for his debt … In practice, however, the solicitor has always been treated as possessing equitable rights in the judgment independently of any declaration of those rights, and the Court’s assistance is invoked not to create the rights but to enforce them.[10] (emphasis added and footnotes omitted)
[10] Ex parte Patience; Makinson v the Minister (1940) 40 SR (NSW) 96, 102.
Therefore, a particular lien does not require a court to declare that the solicitor is entitled to a particular lien, it exists as an equitable right without court assistance. However, if a solicitor seeks to enforce the particular lien, additional considerations apply as discussed hereafter.
In this case the plaintiff claims that the payment by the defendant to the plaintiff was contrary to the valid Notice of Demand for a particular lien and that the defendant is now required to pay to the plaintiff that amount for a second time in order to satisfy the particular lien.[11] The submission that a second payment is required, relies on the case of Roam Australia Pty Ltd v Telstra Corporation Ltd[12] which was followed in Patterson v Cohen.[13] The Patterson case stated that, “the solicitor and not the client can give a good discharge to that person for the amount equivalent to the solicitor’s costs”.[14] That statement in conjunction with the proposition that a lien arises at the time of settlement or when an order is made,[15] (which in the case at bar occurred at a time before the defendant paid moneys to the Worker); led to the submission that as the defendant paid out moneys which were appropriately the subject of a valid lien the defendant was still liable for the unpaid amount.
[11] Roam Australia Pty Ltd v Telstra Corporation Ltd [1997] FCA 980.
[12] [1997] FCA 980.
[13] [2005] NSWSC 635, [4][5].
[14] Patterson v Cohen [2005] NSWSC 635, [4][5] citing the principles in Roam Australia Pty Ltd v Telstra Corporation Ltd [1997] FCA 980 per Lehane J.
[15] Firth v Centrelink (2002) 55 NSWLR 451, 463-464.
Legal proceedings
The first ingredient to be determined in deciding whether or not a particular lien exists is whether there are “legal proceedings” which gave rise to a judgment, award or compromise as previously referred to.
On this point the parties are divided. The plaintiff and the intervener contend it is a judgment or compromise in legal proceedings. The defendant argues that the compromise reached was not in the context of legal proceedings.
The submission that the money was payable to the Worker as a result of legal proceedings is based on the fact that the amount of the compensation resulted from a successfully negotiated conciliation process in a statutory process followed by the Workers Compensation Tribunal. Reliance is placed, amongst other cases, on Cade Pty Ltd v Thomson Simmons (No 2);[16] Re: A Barrister and Solicitor;[17] Color Point Pty Ltd v Markby’s Communication Group Pty Ltd[18] and Campbell v Campbell & Lewis,[19] as indicating that a lien may arise with regard to a negotiated compromise before judgment as well as extending to arbitration.
[16] (2000) 211 LSJS 49, [19].
[17] (1979) 40 FLR 26, 39.
[18] [1998] FCA 1516.
[19] [1941] 1 All ER 274.
Mr McNamara’s submission on behalf of the defendant was that whilst it was accepted that the Tribunal as a whole was a judicial tribunal, nonetheless the Tribunal when exercising its conciliation powers was not acting in a judicial capacity. Mr McNamara submitted that it was necessary for there to be some “coercive power” of a court before there could be legal proceedings, and that “while the parties are in the conciliation zone inside the Tribunal, the practitioner is not doing work which will attract a particular lien”.
There is some support for this proposition in the historical development of the existence of a lien. In Ex parte Patience; Makinson v The Minister,[20] Jordan CJ described the historical development of the particular lien, explaining that a solicitor could “enforce his right by applying to the Court in which proceedings had been heard for a rule directing the judgment debtor to pay the solicitor”,[21] thus connoting both the existence of a judgment and the “coercive power” to enforce the lien of the Court in which legal proceedings took place. However, since that time, the role of mediation, arbitration and conciliation associated with court proceedings has increased. Further, the range of circumstances in which a particular lien has been recognised to exist has also been expanded to include negotiated compromises and arbitration processes.
[20] (1940) 40 SR (NSW) 96.
[21] Ex parte Patience; Makinson v The Minister (1940) 40 SR (NSW) 96, 102.
In determining whether the plaintiff engaged in legal proceedings, it is therefore necessary to focus on the specific nature of the proceedings in the particular case. The nature of the proceedings before the Workers Compensation Tribunal is established by the WR&C Act. Sections 90 and 90A establish that an applicant must lodge a notice of dispute within a prescribed time period. The lodgement of a notice of dispute enlivens the jurisdiction of the Tribunal and sets in motion a structured process leading ultimately to judicial determination before the Tribunal,[22] which enables a conciliator to refer a dispute to the Tribunal for either arbitration or judicial determination where an agreed settlement is not reached at the conciliation. Section 94(b) provides that if a party is dissatisfied with the result of an arbitrated determination, the Tribunal must make a judicial determination.
[22] Section 92D(1).
I reject Mr McNamara’s submission. The interpretation of legal proceedings for which he contends in the context of the enforcement of a solicitor’s lien, is unduly restrictive and narrow. It has already been recognised by this Court that the Tribunal is a court and that proceedings, which include mandatory conciliation proceedings required to be undertaken by the parties before referral for arbitration or judicial determination, is an aspect of the work of the Tribunal which does not detract from it being work in a court.
In Mitsubishi Motors Australia Ltd v Kowalski[23] the Full Court acknowledged the Tribunal’s status as a court and held that the mandatory conciliation proceedings did not prevent the Tribunal from being regarded as a court. The status of the Tribunal as a court is not necessarily determinative of whether a particular proceeding falling within its jurisdiction is a legal proceeding. However, it is a factor that supports the plaintiff’s argument.
[23] (2004) 236 LSJS 101.
As the Full Court said in Mitsubishi Motors Australia Ltd v Kowalski:
While conciliation and arbitration officers are involved in the work of the Tribunal, any party can insist that the matter be determined finally by a presidential member or members of the Tribunal. Although practices differ from State to State, mediators, conciliators and arbitrators are playing an increasing role in the work of the courts in a number of jurisdictions (cf. Supreme Court Act 1935 ss 65 and 68; District Court Act 1991 s 32). I do not regard the conciliation and arbitration powers of the Tribunal as a feature which tells against the Tribunal being regarded as a court. Furthermore, the presence of lay members on the Workers Compensation Board in Victoria did not deter Starke J from deciding that the Board was a “court” in Trevor Boiler Engineering Co Pty Ltd v Morley (supra) at 716.
The procedures of the Tribunal have many attributes in common with courts generally. I have referred to aspects such as the power to punish contempts and award costs, the ability to summons witnesses and direct the production of documents, the power to make rules and the procedures for appeals.[24]
[24] (2004) 236 LSJS 101, [32]-[33].
In particular I note that the same Notice of Dispute which initiates the action in the Tribunal, is the subject matter of the conciliation proceedings. It also forms the ambit of the issues to be determined judicially by the Tribunal within the jurisdiction of the WR&C Act, unless the matter is otherwise disposed of by conciliation or arbitration as under Part 6A of the WR&C Act. The orders which can be made by a conciliation officer after negotiation by the parties, must also fall within the jurisdiction of the Tribunal.[25]
[25] Section 92C(6); s 92C(7).
Mr McNamara further submitted that because conciliation in the Tribunal was a mandatory process and was not a choice of the parties, the orders made by the conciliation and arbitration officer were orders which “cannot go any higher than the contract of compromise between the parties”. He also argued that the Tribunal cannot enforce its own orders and that they were only enforceable by the operation of the District Court. He submitted that if a Tribunal’s consent order was set aside, the compromise reached between the parties would nonetheless stand as an enforceable contract of compromise.
The fact that conciliation is mandatory, in my view strengthens rather than weakens the argument that the conciliation process is embraced as part of legal proceedings within the Tribunal. The conciliation process is not unconfined; it is a structured process. There are statutory obligations on the conciliator to identify issues in order to narrow the dispute and explore the possibilities of resolving the dispute;[26] the conciliator is empowered to summons parties;[27] a person who fails to attend or participate as required commits a contempt of the Tribunal;[28] and a conciliator may make a determination or order to give effect to the settlement[29] which then becomes an order of the Tribunal and is enforceable.[30] Further features of the conciliation process include that the parties to the dispute are required to disclose to the conciliator the existence of relevant evidentiary material, and at the request of another party must give that party access to such material. That amounts to a requirement to give discovery. Also, the presence of counsel for the parties at the conciliation process is contemplated by the Act.[31]
[26] Section 92A.
[27] Section 92B(2).
[28] Section 92B(4).
[29] Section 92C(6).
[30] Section 92C(7).
[31] See s 92(1)(b) and s 92C(5); s 95.
Although the conciliation proceedings have some features which differ from those of a traditional court (such as the ability of the conciliator to interview one party in the absence of the other), it is important to note that the conciliation occurs in the context of a structured statutory process commencing with the notice of dispute and ultimately if unresolved, ending with judicial determination. In this way, an analogy may be drawn between the present case and Color Point v Markby’s Communication Group Pty Ltd,[32] in which a particular lien arose in relation to work conducted in the context of an ongoing process of legal proceedings, despite the matters being resolved by the parties prior to an ultimate determination by a court.
[32] [1998] FCA 1516.
The fact that the order is not enforceable through the Tribunal itself but instead through the District Court, does not detract from the orders made as a consequence of conciliation, being in turn viewed as an end product of legal proceedings which have been instituted.[33]
[33] See Mitsubishi Motors Australia Ltd v Kowalski (2004) 236 LSJS 101, [14], [33].
In short the Tribunal Action, initiated as it was by the Notice of Dispute, having been successfully conciliated with the resulting compromise then recorded by orders, in my view constitutes “legal proceedings” such as would attract a particular lien if the other requirements of the lien are met.
Solicitor instrumental to payment of money
The second ingredient to consider is whether the solicitor has acted for the Worker so as to be instrumental in obtaining an award or compromise for the payment of money to the Worker.
In my view, for reasons previously given, there was a compromise and order which resulted in the liability of the defendant to pay the Worker $23,855.53. The plaintiff appears to have been instrumental in the activities leading to the conciliation conference on 17 June 2005 until their instructions were terminated three days earlier on 14 June 2005. Therefore an equitable right arose, which falls for characterisation as a particular lien, entitling the plaintiff to recover a sum of money for their work.
Court enforcement of lien
However, there is a third ingredient. Before a court would enforce a particular lien for the specific amount of costs to be paid as distinct from securing the amount of those costs, such costs would have to be relevantly agreed by the Worker as being a debt, or assessment by a court or taxed.
It was indicated by Jordan CJ in Ex parte Patience that:
Where a solicitor had acquired a right to receive his costs out of moneys which had become payable to his client as the result of legal proceedings in which the solicitor had acted, and had thus acquired the right by virtue of the general law and independently of any order of a Court, he could…enforce his right by applying to the court in which the proceedings had been had for a rule directing the judgment debtor to pay the solicitor the amount of costs when ascertained by taxation, and in the meantime restraining the judgment debtor from paying and the client from receiving the money without first paying the solicitor the amount of his costs… or directing that the amount of the bill as rendered be paid into Court by the judgment debtor to abide the result of the taxation of the bill… If necessary, a suit in Equity could be commenced to enforce the solicitor's right to payment.[34] (footnotes omitted)
[34] Ex parte Patience; Makinson v the Minister (1940) 40 SR (NSW) 96, 102.
The above observations were made by Jordan CJ in a context in which a court found that an amount of compensation was payable but there had been no judgment signed in the amount of the verdict which was a sum of £250. The solicitor claimed an entitlement to a specific amount of costs which was in excess of the amount of the verdict, namely £644, but was prepared to limit the amount to the sum of £200 when seeking a charging order for his costs. The Full Court considered the jurisdictional basis and characteristics of a solicitor’s lien for costs. The matter proceeded on the assumption that upon a taxation, a sum approximating the amount sought by the solicitor, namely £644, would be allowed. The Court ordered that there be a restraining order preventing payment of £200 or the amount of his taxed costs, whichever should be the lesser, other than to the solicitor.
The approach taken by the Chief Justice, as expressed in the case of Ex parte Patience, was endorsed by the Full Court of the Federal Court in Worrell v Power & Power.[35] The facts in Power & Power were that the Court had made an order that the client, for whom the solicitor acted, was entitled to costs. The solicitor wrote to the client stating that the party liable to pay the costs, had made an offer of a specific amount. The client accepted that sum. The solicitor was paid that sum from the party liable, initially into the solicitor’s trust account and then to the solicitor’s general account. The client committed an act of bankruptcy which related back to a date prior to the date when the solicitor transferred the amount to the general account.
[35] (1993) 46 FCR 214.
The Full Court of the Federal Court held that the equitable rights of the solicitor to the costs arose upon the court order being made and prior to any agreement as to the amount of costs or taxation of such costs. After referring to the case of Ex parte Patience with approval, the Court said:
It indicates that the lien involves more than a personal right of the solicitor to approach the court to obtain a charging order, and that the lien arises when the judgment for costs is obtained, and before there has been a taxation of the costs. The assistance of the court is invoked not to create the rights but to enforce them. So also the right of “self–help”.[36]
[36] (1993) 46 FCR 214, 224.
On the authorities of Ex parte Patience[37] and Worrell v Power & Power,[38] as well as Twigg v Keady (No 2);[39] North West Construction Co Pty Ltd (In Liq) v Marian;[40] Johnsv Cassel,[41] the fact that there has been no specific court order for the amount of the costs presently sought and no taxation of those costs, would not in equity alone be a basis for refusing the protection of a particular lien by, for example, a restraining order. However as previously indicated, enforcement of the lien by a court is dependant upon either an agreement by the client as to the amount owing or a court assessment or alternatively a taxation of costs.[42]
[37] Ex parte Patience; Makinson v The Minister (1940) 40 SR (NSW) 96.
[38] (1993) 46 FCR 214.
[39] (1997) 142 FLR 342, 347.
[40] [1965] WAR 205, 212.
[41] [1993] FLC 92-364.
[42] Firth v Centrelink (2002) 55 NSWLR 451, 464.
This requirement differs from a retaining or possessory lien where the failure to render a bill, or reach agreement as to costs or to tax costs is no impediment and an estimate is sufficient.[43]
[43] Re Jalmoon Pty Ltd [1986] 2 Qd R 264.
In the case before this Full Court, the particular lien claimed is in respect of moneys payable to the Worker by the defendant as a result of settling her claim for compensation, which was then reflected in the Tribunal orders, including an order for entitlement of the Worker to costs of a specific amount of $350. There has been no order made endorsing payment of the specific amount of the costs of $39,969.28 which the plaintiff presently seeks, nor has there been any taxation of those costs. Further, there is no application for a restraining order, as of course the money has already been paid out by the defendant.

I would therefore answer the first question in the Special Case as it is posed in the affirmative. The Notice of Dispute lodged with the Tribunal by the plaintiff in respect of the 3 February 2005 decision; the commencement of the Tribunal Action pursuant to Part 6A of the WR&C Act; as well as participation of the Worker in conciliation proceedings, and the orders of the Tribunal on 17 June 2005 constituted legal proceedings in respect of which the plaintiff could claim a particular lien.
I would add a rider which was not specifically requested to be answered in the Special Case although it was the subject of oral argument addressed to the Court. Namely, whether the defendant was required to pay the amount of the lien a second time. In my view the affirmative answer to this first question does not necessarily permit the plaintiff to enforce the lien by requiring the defendant in equity to pay a second time. The costs must either be acknowledged by the Worker to be a debt, or assessed by a court or taxed by a court. Further, there is still the question of whether there can be recovery of a lien by reason of the provisions of the WR&C Act.
Does the WR&C Act abrogate recovery of a particular lien for solicitors’ costs?
The plaintiff and the intervener contend that there was no abrogation of a solicitor’s lien, either expressly or by necessary implication, by reason of the WR&C Act.
It was common ground to all parties that there was no express abrogation of a solicitor’s lien by the WR&C Act and the focus of argument was whether abrogation was implied.
The arguments of the plaintiff and the intervener in support of the proposition that there was no abrogation, were based upon well known authoritative statements of the principle of the presumption that, “the legislature [will not] overthrow fundamental principles, infringe rights or depart from the general system of law, without expressing its intention with irresistible clearness”.[44]
[44] Potter v Minahan (1908) 7 CLR 277, 304. See also Bropho v State of Western Australia (1990) 171 CLR 1, 18; Coco v The Queen (1994) 179 CLR 277, 437-438; Thompson v Australian Capital Television Pty Ltd (1994) 54 FCR 513, 526.
In response, Mr McNamara, for the defendant, contended that whilst there was no express abrogation in the WR&C Act, the test as submitted by Mr Wells for the intervener was not appropriate to the issue. Further, the WR&C Act provisions clearly demonstrated that the statutory right of the Worker to receive compensation and the concomitant obligation of the defendant to pay compensation from the Compensation Fund, had priority over any equitable right of the plaintiff to a particular lien. Mr McNamara submitted that the principle enunciated in the cases relied upon by Mr Wells did not directly apply to this circumstance. He contended that this was not a circumstance in which a private right of a citizen has been arguably taken away by a statute enacted “in the interest of the State or the public has a whole”. Instead, it was a question of competing citizens’ rights. Namely, on the one hand the equitable right of a solicitor to recover their fees from moneys due to the client as a consequence of the legal work done, and on the other hand, the statutory right of a worker to be entitled to compensation payments in respect of a work disability. This, according to Mr McNamara, was a question of “adjustment of rights between two citizens – the Worker and his or her legal practitioner”.
At the same time it was conceded by Mr McNamara that a particular lien is an equitable right which was entrenched in non-statutory legal principles and is akin to a proprietary right. Further, that “clear words” were needed to exclude a non-statutory right. In my view this was a correct concession.
I do not consider that there is much profit to be gained by a semantic debate as to whether the equitable right of a solicitor is a “fundamental right”. It is a right akin to a proprietary right which is being considered and such rights have always received particular protection at law. I do not think there is any modification required to the principles or the “standard” to be applied in deciding whether the WR&C Act removed, modified, or abrogated a solicitor’s equitable right to be paid their costs and disbursements from compensation payments.
It was also argued by Mr Wells that a solicitor’s lien was not simply a personal right. It is a matter of public interest and is part of the protection which recognises that solicitor’s are officers of the Court and involved in upholding the administration of justice. In the reasons of the respective Full Courts in Ex parte Patience and Worrell v Power & Power[45] there is some support for Mr Wells’ proposition that it is not simply a personal right. In Power and Power the Court discussed whether the claim for a particular lien by a solicitor was a “personal right” and whether that it was at best no more than a mere “personal equity” to seek a charging order.[46] The Court concluded:
Later authority indicates that the equitable rights under the solicitor’s lien arise before there is a fund in court, and indeed, before the judgment for costs has been quantified by taxation.[47]
[45] Worrell v Power & Power (1993) 46 FCR 214.
[46] Worrell v Power & Power (1993) 46 FCR 214, 217 – 221.
[47] Worrell v Power & Power (1993) 46 FCR 214, 222.
The case did not specifically address any issue of public interest for the protection of solicitor’s costs.
In considering Mr Wells’ argument of public interest protection, I note that a claim for an equitable lien is not confined to claims by solicitors. An equitable lien has a more general application and may for example apply to a trustee in respect of his or her expenses in relation to trust property. Further, an equitable lien has been described as “an equitable remedy, created by the court, regardless of the intent of the parties, as a remedial device to protect a party against some inequitable loss”.[48] I also note, that there is no closed category of situations in which an equitable lien may apply.
[48] Stephenson Nominees Pty Ltd v Official Receiver (1987) 16 FCR 536, 554.
It therefore appears to me that an equitable lien is not a personal right, nor would it be characterised as a public interest right. The equitable lien appears to apply to situations in which the court considers that it is important to protect parties from inequitable loss. A solicitor’s particular lien is but one instance where the court recognises that “inequitable loss” could be caused if solicitors perform work which is instrumental to a client obtaining money, and that their right to claim costs from that money should not be then defeated by other claims. The equitable lien is simply the application by the court of equitable remedies and principles to particular situations.
Mr Wells in addition argued that, far from there being any implied abrogation of a particular lien, the WR&C Act assumes that the legal profession would be involved in the legal proceedings under the WR&C Act. Further, that ss 95 and 88G of the WR&C Act expressly recognises that workers are likely to be represented by lawyers and that an award of costs may be made “in favour of the person who provided the professional advice or assistance”.[49]
[49] Worker’s Rehabilitation and Compensation Act 1986 s 95(4).
In considering these submissions I commence by noting that the WR&C Act is beneficial legislation, the primary object of which is to “establish a Workers rehabilitation and compensation scheme”.[50] Other relevant features for the purposes of this argument are that the WR&C Act is to provide “for the effective rehabilitation of disabled workers and their early return to work”;[51] “provide fair compensation for employment-related disabilities”[52] and “provide for the efficient and effective administration of the scheme”.[53]
[50] Section 2(1)(a).
[51] Section 2(1)(a)(ii).
[52] Section 2(1)(a)(iii).
[53] Section 2(1)(b).
The scheme is administered by the defendant pursuant to s 13(1)(a)(i) of the WorkCover Act 1994. Section 12(b) of the WorkCover Act, delineates complementary objects, for the defendant to ensure “prompt and effective rehabilitation of workers” and provides that there be “fair compensation for work-related injuries”.[54] The defendant also has the function of “promoting the rehabilitation” of injured workers[55] and “ensuring the efficient and economic operation” of the scheme.[56]
[54] WorkCover Act 1994 s 12(c).
[55] WorkCover Act 1994 s 13(1)(c).
[56] WorkCover Act 1994 s 13(1)(e).
The two primary sections which provide for the Worker’s entitlement to compensation are ss 32 and 35 of the WR&C Act. Referring first to s 35, it relevantly provides that where a worker suffers a compensable disability resulting in incapacity “the Worker is entitled to weekly payments in respect of that disability”.[57] This section is also to be read with s 36 of the WR&C Act which provides that “weekly payments to a worker…must not be discontinued”[58] or reduced,[59] and exceptions and procedural requirements are set out in the remaining subsections.
[57] Worker’s Rehabilitation and Compensation Act 1986 s 35(1).
[58] Section 36(1).
[59] Section 36(2).
It is to be noted that ss 35 and 36 of the WR&C Act provide not only for the Worker’s entitlement to weekly payment of compensation, but also for the payment of that compensation “to a worker”. This interpretation is reinforced by the provisions of s 36(6) and (7), also referring to the defendant making a payment “to a worker” and that any overpayment to a worker allows the defendant to take recovery proceedings. Also s 38 of the WR&C Act provides a right of review of weekly payments “made to a worker”. I reject the argument of Mr Wells that these sections are limited to entitlement only and do not expressly require payment of that entitlement to the Worker.
Section 32 provides that “a worker is entitled to be compensated” for certain costs reasonably incurred by the Worker for having suffered a compensable disability.[60] The particular costs set out also include medical and hospital services and the section specifies that the:
Compensation in respect of the costs [as is defined in s 32(1)] may be paid:
(a) to the worker; or
(b) directly to the person to whom the worker is liable for those costs.[61]
[60] Section 32(1).
[61] Section 32(3).
This subsection expressly gives an alternative for the payment to be made to a person other than to the Worker. Also there is control given to the defendant to protect the Worker from the effects of overcharging in respect of such costs.[62]
[62] Section 32(4) and (6).
I now turn to the concomitant liability of the defendant to pay compensation. Section 46 of the WR&C Act states that the defendant “is liable to make all payments of compensation to which any person becomes entitled under the Act”. This section squarely places responsibility on the defendant to only pay compensation to the person who is statutorily entitled to receive payments.[63] This is qualified in respect of the first 14 days, when the employer has the liability to pay compensation for the first two weeks of payment[64] and there are other qualifications in ss 48, 49 and 50.
[63] There is a similar provision in respect of the responsibility of an exempt employer under s 46(2) to be liable to make all payment of compensation see s 46(2).
[64] Section 46(6).
Section 46 of the WR&C Act therefore is linked back to ss 35 and 32, and the obligation of the defendant is only discharged if compensation has been paid to the person entitled under the Act, which in the case of s 35 is the Worker and in the case of s 32 can either be the Worker or the person who provided the services.
The establishment and maintenance of the statutory “Compensation Fund” from which compensation is paid, is provided for in Division 3 of the WR&C Act. Section 64(1) provides that the defendant shall establish and maintain that fund. Section 64(3) also specifies the manner in which the moneys in the Compensation Fund are to be applied and there are four exclusive applications indicated. One of them is that the Fund is to be applied towards “the payments of compensation that the Corporation is liable to make under this Act”.[65] Further, the Fund is to be applied towards “the costs of the system of dispute resolution established by this Act”.[66]
[65] Section 64(3)(a).
[66] Section 64(3)(c).
In relation to the costs of the system of dispute resolution, s 64(3)(a) provides the manner in which the amount to be paid from the Compensation Fund under s 64(3)(c) is to be determined either by agreement or in default of agreement by the relevant minister.
The dispute resolution system is essentially contained in Part 6A of the Act, which part describes the whole decision making process and resolution of disputes and the decisions which are reviewable by the Tribunal. Division VII under that part refers to costs and provides as follows:
Costs
95. (1) A party (other than the relevant compensating authority) is entitled, subject to this Part and to limits prescribed by regulation, to an award against the relevant compensating authority for the party's reasonable costs of -
(a)     the initial reconsideration of a disputed decision; and
(b)     any subsequent proceedings for resolution of the dispute under this Part (but not proceedings by way of an appeal or case stated to a Full Bench of the Tribunal or the Supreme Court).
(2)     Costs may only be awarded to cover –
(a)     the cost of representation by a legal practitioner or an officer or employee of an industrial association; and
(b)     costs of a kind authorised by the regulations that were reasonably incurred.
(3)     If the Tribunal is of the opinion that a party acted unreasonably, frivolously or vexatiously in bringing or in relation to the conduct of proceedings, the Tribunal may -
(a)     decline to make an award of costs in favour of the party and may further (if it thinks fit) make an award of costs against the party; or
(b)     reduce the amount of the award to which the party would otherwise have been entitled.
(4)     An award of costs to cover professional advice or assistance may, if the Tribunal considers appropriate, be made in favour of the person who provided the professional advice or assistance.
(5)     An award of legal costs cannot exceed 85% of the amount that would be allowable under the relevant Supreme Court scale if the proceedings were in the Supreme Court.
The opening subsection (1) refers to a “party” which is defined in s 89 of the WR&C Act to include the person who lodges a notice of dispute, the relevant compensating authority, the Worker, the employer or a person who has a direct interest in the dispute. The term “relevant compensating authority” in s 95(1) is also defined as meaning the defendant or relevant delegate or an exempt employer. Therefore s 95(1) entitles any party other than the defendant[67] to an award for reasonable costs as defined in subsection (a) and (b).
[67] Or exempt employer.
The entitlement to “costs” which are referred to under this section are limited to costs of representation by either a legal practitioner or an officer or employee of an industrial association.[68] Section 95(4) provides for the mechanism whereby an “award of costs can be made” to cover for the advice or assistance given by a legal practitioner or an officer/employee of an industrial association. It is to be noted from this subsection that an award of costs is to be “made in favour of the person who provided the professional advice or assistance”. Therefore the section expressly indicates that the award of costs is not to be paid to the party but to the person who provided the advice or assistance. It is also to be noted that the control of the award of costs to be paid, is with the Tribunal as it is the Tribunal which makes the award of costs by way of order.
[68] Section 95(2)(a).
At this point therefore, considering subsections 95(1) and 95(4), although it is the party who is entitled to an award for costs, that award is made in favour of the person who provided the professional advice. There is a separation between the entitlement on the one hand and payment on the other.
Finally, s 95(5) states that an award of legal costs cannot exceed 85 per cent of the amount that would be allowable under the relevant Supreme Court Scale. This section has been the subject of specific consideration in the recent case of Jacobs v Onesteel Manufacturing Pty Ltd & WorkCover Corporation of SA.[69]
[69](2006) 93 SASR 568.
In summary, entitlement to payment for costs to a solicitor under this section is subject to the following requirements:
·an award or order by the Tribunal (s 95(4));
·that they be reasonable costs (s 95(1));
·that they do not exceed 85 per cent of the relevant Supreme Court Scale (s 95(5)); and
·are subject to regulation as to costs (s 95(1)).
·the relevant Regulations are Regs 7(1) and 7(2) of the Workers Rehabilitation and Compensation (Dispute Resolution)Regulations 1996 as well as r 28 (7a) and (7e) of the Workers Compensation Tribunal Rules 2001.[70]
[70] See also discussion in Jacobs v Onesteel Manufacturing Pty Ltd & WorkCover Corporation of SA (2006) 93 SASR 568.
In my view the clear intent of the legislative provisions is to require the defendant to pay the costs of a legal practitioner directly to the practitioner from the Compensation Fund if an award is made, but that the payment is limited to such amount as the Tribunal orders. In the absence of such an order, payment is not authorised, as payment outside the process of s 95 is not entertained in s 64(3) of the WR&C Act. As Besanko J indicated in Jacobs v Onesteel Manufacturing Pty Ltd & WorkCover Corporation of SA:
Section 95(5) does not purport to specify a rule or rules as to how a party’s costs are to be quantified. It provides a limit or ceiling which Parliament has seen fit to impose, presumably because it does not wish the dispute resolution procedure to become too costly, and it does not purport to give a party a right to costs quantified at 85 per cent of the amount that would be allowable under the relevant Supreme Court scale if the proceedings were in the Supreme Court.[71]
[71] (2006) 93 SASR 568, [108].
These sections strongly indicate that the WR&C Act intends to exclude any entitlement of a solicitor to claim a lien for payment by the defendant from the Compensation Fund other than a payment following an award for costs under s 95(4). Therefore, prima facie this legislation purports to modify a solicitor’s right of entitlement and recovery from the Compensation Fund for a particular lien from an amount of weekly payment of compensation which may otherwise be payable to the Worker pursuant to the WR&C Act.
Further, it is to be noted that there is an absence of provisions equivalent to s 32(2) whereby costs for named services which may have been incurred by the Worker, may be paid by the defendant instead of the Worker. Also, such an interpretation limiting the right of recovery by way of a particular lien, is in keeping in a general sense with the provisions of s 119 which prevents any agreement between the Worker and any person, which would include a solicitor, with regard to an agreed costs arrangement, purporting to authorise moneys to be paid from the Compensation Fund out of any entitlement, to be a valid and enforceable agreement.
This protective approach in relation to a lien is also in keeping with the approach that has been taken for protection of a worker’s compensation payments in relation to earlier provisions or predecessors to the WR&C Act. The Workmen’s Compensation Act 1932 as amended included the following provision in relation to costs which expressly modified the right of a legal practitioner to claim a lien in relation to compensation. It was limited to circumstances in which the amount of costs was awarded by an arbitrator or Special Magistrate according to a scale of costs. Section 58 of the Workmen’s Compensation Act 1932 read as follows:
s 58. No solicitor and no agent of a person claiming compensation under this Act shall be entitled to recover from him any costs in respect of any proceedings in an arbitration under this Act, or to claim a lien in respect of such costs on, or deduct such costs from, the sum awarded or agreed as compensation, except such sum as may be awarded by the arbitrator or Special Magistrate, on an application made either by the person claiming compensation, or by his solicitor or agent, to determine the amount of costs to be paid to the solicitor or agent; and any such sum, unless it is a lump sum, shall be awarded subject to taxation and to the scale of costs prescribed by Rules of Court.

There was also another protective provision in relation to compensation, being s 36 which provided that payments were not assignable. Section 36 as per the 1941 amendment, read:
s 36. A weekly payment, or a sum paid by way of redemption thereof, shall not be capable of being assigned, charged, or attached, and shall not pass to any other person by operation of law nor shall any claim be set off against the same, nor shall any deduction be made from any such payment or sum for the purpose of paying hospital, medical, ambulance, or other expenses, pursuant to the Hospitals Act, 1934.
Also in the Workmen’s Compensation Act 1971-1974 as amended, s 41 expressly modified the right of a solicitor to claim a lien from compensation payments to circumstances in which the Court awarded such costs[72] and further provided that no agreement for a greater amount was binding and it could be recovered as a debt if so paid.[73] Section 41 as amended in 1973 was in the following terms:
41.     (1)     Subject to subsection (1a) of this section, in any proceedings under this Act the Court may award costs against any party thereto or order that such costs be taxed by the Court which may be constituted by an industrial magistrate upon the scale fixed by the Rules of Court.
(1a)    The Court shall not order or award, against a worker who is a party to any proceedings under this Act, the costs of another party unless it is satisfied that in relation to those proceedings some special reason exists why it is proper that those costs be so ordered or awarded.
(1b)    Where it appears to the Court that costs to a party have been improperly or without reasonable cause incurred by reason of the misconduct or default of a legal practitioner the Court may call on the legal practitioner to show cause why those costs should not be paid by the legal practitioner personally or, as the case requires, be repaid by the legal practitioner to the party incurring them and thereupon the Court may make such order as the justice of the case may require.
(2)     No legal practitioner acting for a worker shall be entitled to recover from that worker any costs in respect of any proceedings under this Act or to claim a lien in respect of such costs on or to deduct such costs from any sum awarded as compensation unless those costs have been awarded by the Court.
(3)     No agreement by a person claiming compensation to pay any amount by way of costs greater than the amount awarded by the Court shall be binding on that person and any amount paid by that person by way of costs in excess of the amount so awarded shall be recoverable by that person as a debt due to him.
(4)     In this section “proceedings under this Act” includes any matter of thing relating to the preparation of an agreement referred to in Division III of Part III of this Act and any other matter or thing whether or not of the same kind as the foregoing prescribed by the Rules of Court.
[72] Section 41(2).
[73] Section 41(3).
Likewise s 57 of that same Act provided that compensation provisions were not assignable, as amended in 1983 it read:
s 57. A weekly payment, or a sum paid by way of redemption thereof, shall not be capable of being assigned, charged, or attached, and shall not pass to any other person by operation of law, nor shall any claim be set off against the same, nor shall any deduction be made from any such payment or sum for the purpose of paying hospital, medical, ambulance, or other similar expenses pursuant to any Act.
Therefore there has been historical protection of workers compensation payments through legislation for more than 50 years which legislation has in the past expressly modified and restricted the right of a legal practitioner to enforce a lien to costs awarded by the court to costs according to a scale.
There is a clear public interest expressed in such legislation to ensure that a worker is paid entitlements to worker’s compensation payments, and recognises a worker’s vulnerable position by reason of being injured. It also recognises the need to allow for circumstances of support during a process of hopeful rehabilitation and recovery from injury. These matters were referred to by the Claims Agent and WorkCover when the monies were paid to the Worker as set out earlier in [23] of these reasons.
I therefore conclude that the WR&C Act by necessary implication, modifies the equitable right of a solicitor to claim and enforce a particular lien over compensation payments otherwise payable to a worker from the Compensation Fund. The only payment which the defendant is authorised to make to a solicitor from the Compensation Fund is that which falls under s 95 of the WR&C Act.
I would therefore determine that question two be answered as follows; the plaintiff did not have the right to a particular lien over moneys recovered by the Worker pursuant to [2] of the Tribunal orders. Although at this point I would add that the plaintiff had the right to a particular lien for the sum of “$350 and reasonable disbursements to be agreed or taxed” from the Compensation Fund in accordance with [3] of the order by the Tribunal on 17 June 2005, which is in part an answer to question 3 of the Special Case.
Does the lien extend to the Industrial Court Action?
In relation to the costs attributable to the Industrial Court Action, those costs amount to a sum of $20,667.73,[74] being the majority of the costs sought on the lien.
[74] $23,855.53 less $3,187.80 as agreed in the Special Case.
There are two arguments. First, whether the amount sought as costs payable in relation to the Industrial Court Action, is properly the subject of a lien on a stand-alone basis. Secondly, if not, whether it is necessarily connected with the quantum of payment of compensation so as to be properly included as an aspect of costs of the Tribunal Action.
Dealing with the second argument, the reasoning in relation to whether a lien exists for costs in the Tribunal Action, would lead to the same result with respect to whether a lien exists for the Industrial Court Action. Namely, that the plaintiff does not have a right to entitlement and enforcement of a particular lien over the moneys recovered by the Worker pursuant to paragraph [2] of the order. Therefore there is no need to consider the argument of Mr Wells as to whether in order to quantify the compensation payments it was necessary to review the Worker’s entitlements to wages by invoking the jurisdiction of the Industrial Court. Nor is it necessary to consider whether the Industrial Court Action was “immediately incidental” to the Tribunal Action.[75]
[75] Firth v Centrelink (2002) 55 NSWLR 451.
As to the first argument, the proceedings in the Industrial Court were legal proceedings in a court and therefore the first ingredient of the basis for a particular lien applies. As to the second ingredient required of a particular lien, the issue is whether the moneys recovered by the Worker were the fruits of the Industrial Court Action. The Industrial Court Action for underpayment of wages, resulted in a decision that, as from May 2004 the Worker should have been classified as a Grade Two Scientist and paid accordingly. The Court did not make a final order and the matter was adjourned. The Worker’s compensation payments dated from 1 September 2004, post dated the period for which underpayment was ordered. While no doubt the finding in the Industrial Court Action assisted in the quantification of the weekly compensation payments, which was conciliated and the subject of an order, the compensation payments were not the outcome or product of the Industrial Court Action. They comprised payment due to the Worker for a work disability. There is no stand-alone particular lien which the plaintiff can claim for the costs of the Industrial Court Action over such compensation payments due from the Compensation Fund. Further the defendant was prevented from paying such amount for reasons previously discussed.
Therefore there is no particular lien which the plaintiff has in relation to the costs associated with the Industrial Court Action on the amount payable to the Worker for compensation payments.
I would determine that question three be answered as follows; the plaintiff had the right to a particular lien for the sum of “$350 and reasonable disbursements to be agreed or taxed” from the Compensation Fund in accordance with [3] of the order by the Tribunal on 17 June 2005 but that right did not include any costs in relation to the Industrial Court Action.
Conclusions
I would answer the three questions posed in the Special Case as follows:
1.The Notice of Dispute lodged with the Tribunal by the plaintiff in respect of the decision of 3 February 2005 and the commencement of the Tribunal Action pursuant to Part 6A of the WR&C Act; as well as participation of the Worker in conciliation proceedings, and the orders of the Tribunal on 17 June 2005, constituted legal proceedings in respect of which the plaintiff could claim a particular lien.
2.The plaintiff did not have the right to a particular lien over moneys recovered by the Worker pursuant to [2] of the Tribunal orders.
3.The plaintiff had the right to a particular lien for the sum of “$350 and reasonable disbursements to be agreed or taxed” from the Compensation Fund in accordance with [3] of the order by the Tribunal on 17 June 2005 but that right did not include any costs in relation to the Industrial Court Action