Simpson v Loxlu Pty Ltd and Smithers Family Trust trading as Young Automotive Repairs
[2006] NSWWCCPD 337
•7 December 2006
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS
CITATION:Simpson v Loxolu Pty Ltd and Smithers Family Trust t/as Young Automotive Repairs [2006] NSWWCCPD 337
APPELLANT: Christopher Simpson
RESPONDENT: Loxolu Pty Ltd and Smithers Family Trust t/as Young Automotive Repairs
INSURER:Allianz Australia Workers Compensation (NSW) Ltd
FILE NUMBER: WCC9371-05
DATE OF REGISTRAR’S DECISION: 28 September 2005
DATE OF APPEAL DECISION: 7 December 2006
SUBJECT MATTER OF DECISION: Appeal against the Registrar’s decision in relation to costs: professional costs - claim under Item 2.05 of the Compensation Costs Table in Schedule 6 of the Workers Compensation Regulation 2003; disbursement – investigator’s report.
PRESIDENTIAL MEMBER: Acting Deputy President Julian Martin
HEARING:On the papers
REPRESENTATION: Appellant: McCabe Partners Lawyers
Respondent: Hicksons Lawyers
ORDERS MADE ON APPEAL: Paragraphs 2 and 4 of the decision of the Registrar’s delegate dated 28 September 2005 are revoked and the following orders made in their place:
“2.The Applicant’s costs of the proceedings are assessed at $8,340.85.
4.The Respondent is to pay the amount of $8,753.35 to the Applicant if those costs have not already been paid.”
No order as to costs of the appeal.
BACKGROUND
On 17 October 2005 Christopher Simpson (‘Mr Simpson’) filed an appeal against the Registrar’s assessment of costs which was determined on 28 September 2005.
The Respondent to the Appeal is Loxolu Pty Ltd and Smithers Family Trust t/as Young Automotive Repairs (‘Young Automotive Repairs’) who filed a ‘Notice of Opposition’ to the appeal together with submissions on 24 November 2005.
On 30 May 2003 Mr Simpson commenced proceedings against Young Automotive Repairs in the Workers Compensation Commission (‘the Commission’) seeking medical expenses and lump sum compensation. Liability was not in issue.
The matter was resolved between the parties as a result of a telephone conference and a Certification of Determination dated 16 September 2003 was issued. The Certificated noted the consent of the parties that Young Automotive Repairs pay Mr Simpson’s costs as agreed or assessed.
The parties were not able to agree to the costs and Mr Simpson filed an Application for Assessment of Costs on 17 June 2005.
The costs were determined by the Registrar’s delegate, a Commission Arbitrator (‘the Delegate’) on 28 September 2005. Mr Simpson has appealed that determination.
THE REGISTRAR’S DECISION
The Registrar’s decision by her delegate, a Commission Arbitrator made on 28 September 2005 is as follows:
“1.Pursuant to a Certificate of Determination dated 16 September 2003 the Respondent employer is liable to pay the Applicant’s costs of the proceedings as agreed or assessed.
2.The Applicant’s costs of the proceedings are assessed at $8,799.60 inclusive of GST.
3.The Applicant’s costs of the assessment are assessed at $412.50 inclusive of GST.
4.The Respondent is to pay the amount of $9,212.10 inclusive of GST to the Applicant if those costs have not already been paid.”
ON THE PAPERS
Young Automotive Repairs submits that the matter should be dealt with ‘on the papers’, whilst Mr Simpson is silent on the issue.
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
I have both the Commission file regarding the costs dispute and the appeal file which contains submissions on appeal from both Mr Simpson and Young Automotive Repairs. In addition I have the substantive file and am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
ISSUES IN DISPUTE
Mr Simpson submits that the Delegate erred in relation to his solicitor’s professional costs under Item 2.05 and in relation to the disbursements for the private investigator’s report.
PRELIMINARY
Part 19 of the Workers Compensation Regulation 2003 (‘the Regulations’) govern both the procedure for assessment of costs and appeals against such an assessment.
Clause 119(1) of the Regulations limits the grounds on which an appeal may be made against the determination of the Registrar on an assessment of costs to a matter of law. As Deputy President Fleming stated in Berger v Moree Plains Shire Council [2005] NSWWCCPD 152 (‘Berger’s case’):
“The determination of these questions by a costs assessor, is a matter of discretion and, as I said in Nebauer v Hunter Area Health Service [2004] NSWWCCPD 60 (at para 19):
“Only where the discretion can be said to have miscarried because it was exercised unfairly and unlawfully, taking into account the scope of the discretion, and the objects or purpose for which it is conferred, would it be an error of law (Swan Hill Corporation v Bradbury (1973) 56 CLR 746 at 758; R v Australian Broadcasting Tribunal; ex p 2HD Pty Ltd (1979) 144 CLR 45 at 49; Sheridan v David Anthony Clarke t/as Freestyle Marine Sports [2003] NSWWCCPD9).””
SUBMISSIONS, DISCUSSION AND FINDINGS
Private Investigator’s Fee
Clause 82 of the Regulations excludes certain costs, including investigator’s reports and witness statements or other evidence obtained by investigators, from Part 19 of the Regulations. These items must be assessed in accordance with the Legal Profession Act 2004 (‘the LP Act’) and the Legal Profession Regulation 2005 (‘the LP Regulation’) (Berger’s case).
In the Application for Assessment of Costs Mr Simpson’s solicitor claimed the sum of $2,032.38 for a private investigator’s report. It includes a factual and liability summary and statements from Mr Simpson and his wife.
The Delegate considered that there was material in the investigation report relevant to the claim for pain and suffering and in his discretion allowed an amount of $500 as “fair and reasonable” in the circumstances. He then referred to Clauses 110 and 111 of the Regulations.
It was an error of law in purporting to assess the costs of the investigation report pursuant to Clause 110 of the Regulations. As stated above, these items must be assessed in accordance with the LP Act and the LP Regulations. As Deputy President Fleming stated in Berger’s case:
“The correct test is whether the disbursement was ‘reasonably incurred or was reasonable in amount’ and whether the total amount allowed was a ‘fair and reasonable’ amount in relation to the value of the service provided.”
There being an error of law, in accordance with Clause 119 of the Regulations, I am entitled to make such determination in relation to the application, as in my opinion should have been made by the Delegate.
As I stated above liability was not disputed in the substantive proceedings, the issues being the degree of impairment/loss, subject to deduction for pre-existing condition or previous injury, together with the extent of pain and suffering. There was no need for an investigator to make general enquiries into the circumstances of the injury and prepare a factual liability summary. There was also no need for a statement to be taken from Mrs Simpson as liability was not in issue and an offer had been made prior to the commencement of proceedings. Except for the statement taken from Mr Simpson, the investigator’s report was not reasonably incurred.
The cost of obtaining a witness statement, including that of the worker, is normally covered under Item 2.01 or Item 2.04A of the Regulations. In the Application for Assessment of Costs, the claim under Item 2.01 did not include the cost of witness statements, as Mr Simpson’s solicitor submits the time allowed under this item was taken up in advising Mr Simpson of his rights and entitlements. As Mr Simpson’s statement was taken by an investigator it was not claimed under Item 2.04A.
The test of whether an investigator’s report, whether to obtain witness statements or other factual investigations (including a statement from the worker), is claimable will “….essentially be one of ‘reasonableness’.” (Berger’s case).
The statement of Mr Simpson took 1 hour 15 minutes. As a guide, Item 2.04A allowed (at the relevant time) $100 per hour for taking a witness statement up to a maximum of $150. Having regard to the circumstances of this case including:
· liability was not in issue;
· the investigator was not a legal practitioner; and
· the time taken for the interview
I allow the sum of $100 (plus GST of $10) for the investigator’s report to allow for the time taken in relation to Mr Simpson’s statement. As I consider the statement taken from Mrs Simpson was not reasonably incurred in the circumstances there is no allowance for that statement.
In his submissions on appeal, Mr Simpson submits that the Delegate erred in not applying Clauses 105 and 106 of the Regulations. As stated above, investigator’s reports are excluded from assessment under the Regulations.
Professional Costs – Item 2.05
Item 2.05 provides a maximum amount of $100 for briefing a factual investigator or other investigator to obtain evidence other than witness statements (not including the investigator’s fee).
Mr Simpson’s solicitors claimed the amount of $100 for briefing a factual investigator and in support of their claim enclosed a copy of the letter sent to the investigator. The Delegate allowed the sum of $68.75 inclusive of GST for the letter of instructions to the investigator. In determining this amount the Delegate took into account the relevant material forwarded to the investigator and noted that, amongst other things, they were briefed to obtain statements from Mr Simpson and his wife.
Mr Simpson in his submissions on appeal states that Item 2.05 is an “amount-based allowance” and not a “time-based allowance” and accordingly the Delegate erred in determining the amount of $68.75 inclusive of GST. In response Young Automotive Repairs submit that Item 2.05 is an “event-based entitlement” and the Delegate was not satisfied that Mr Simpson’s solicitor had justified his full entitlement to the sum of $100 because the letter to the factual investigator requested witness statements which are excluded from Item 2.05.
As I have stated above there was no need for a factual and liability summary report. I have disallowed the cost of the investigator’s report except for the expense of obtaining a statement from Mr Simpson. As Item 2.05 provides for briefing a factual investigator to obtain evidence other than witness statements it follows that there is no entitlement under this item.
DECISION
Paragraphs 2 and 4 of the decision of the Registrar’s delegate of 28 September 2005 are revoked and the following orders made in their place:
“2. The Applicant’s costs of the proceedings are assessed at $8,340.85.
4.The Respondent is to pay the amount of $8,753.35 to the Applicant if those costs have not already been paid.”
COSTS
Young Automotive Repairs seeks payment of its costs in the appeal pursuant to Section 341(4) of the 1998 Act. This section provides that the Commission may not order the payment of costs by a claimant unless satisfied that the claim was frivolous or vexatious, fraudulent or made without proper justification. Having regard to this matter I am not satisfied that this claim comes within any of these categories and accordingly I make no order as to the costs of this appeal.
Julian Martin
Acting Deputy President
7 December 2006
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JULIAN MARTIN, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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