SUPREME COURT OF QUEENSLAND - [2003] QSC 252

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SUPREME COURT OF QUEENSLAND [2003] QSC 252
CIVIL JURISDICTION
MULLINS J
No S1868 of 2002

THOMAS WILLIAM REW Plaintiff
and
VISIONSTREAM PTY LTD Defendant
(ACN 062 604 193)
BRISBANE
..DATE 31/07/2003
ORDER

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

HER HONOUR: This is an application for a declaration that 1

upon the proper construction of a document entitled, "Offer of accepted by the defendant on 24 March 2003, the applicant is entitled to recover against the respondent, his costs in

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accordance with the WorkCover Queensland Regulation 1997 (the
Regulation).
The applicant had a claim for damages for personal injuries sustained in the course of his employment by the respondent on

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5 March 1999. The applicant therefore had to comply with the pre-proceedings steps set out in the WorkCover Queensland Act 1996 (the Act). It appears that the applicant may have been
in receipt of compensation as a result of the work injuries,
but did not foreshadow bringing the claim for damages until

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his solicitor's letter addressed to WorkCover Queensland
(WorkCover) on 12 February 2002. Because of the imminent
expiry of the limitation period, a request was made on behalf
of the applicant for WorkCover to issue a conditional damages
certificate.

40

It is common ground that on 18 February 2002, WorkCover issued a conditional damages certificate pursuant to the Act. This proceeding, pursuant to which the applicant sought damages for personal injuries against the respondent, was commenced on 27

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February 2002. Pursuant to section 262 subsection 4 of the
Act, the effect of the issue of the conditional damages
certificate was to authorise the applicant to start this
proceeding, but to stay this proceeding until the certificate

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

was made unconditional by WorkCover and the applicant had 1
complied with Parts 5 and 6 of the Act.
The applicant's notice of claim was given on 24 July 2002. On
11 March 2003, the parties participated in a compulsory

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conference pursuant to section 293 of the Act. In accordance with the obligation imposed under section 294 of the Act, the applicant dispatched the written offer of settlement, dated 11
March 2003. Pursuant to clause 1 of the offer, the applicant offered to accept from WorkCover the sum of $250,000 for all

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damages and interest, clear of WorkCover's charge of
$66,759.44 in full and final satisfaction of his claim for
damages for personal injuries arising in the course of his
employment on 5 March 1999.

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Clause 2 of the offer stated:
"In addition, WorkCover shall pay the legal costs and
outlays of the claimant/plaintiff as agreed or, failing
agreement, as calculated in accordance with Division 2 of
Part 7 of the WorkCover Queensland Regulation 1997."

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By letter dated 24 March 2003, the solicitors for the respondent accepted the offer in the following terms:
"We have instructions to accept your client's s.294 offer
in the sum of $250,000.00 clear of the WorkCover refund
plus Regulation costs. A Discharge and HIC Notice of
Settlement will be forwarded shortly."

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Under cover of letter dated 25 March 2003, the solicitors for
the respondent forwarded a form of discharge to the solicitors

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

for the applicant. It was signed by the applicant on 31 March 1
2003 and returned by the applicant's solicitors to the
respondent's solicitors under cover of a letter of the same
date. The discharge is in form an agreement which purports to

document the settlement agreed upon between the applicant and 10
the respondent and to which WorkCover is also named as a
party.
Clause 2 of the discharge provides:
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"In addition to the payment referred to in clause 1
hereof, WorkCover shall also pay on its own behalf and on
behalf of Visionstream, Rew's costs of and incidental to
the proceedings with such costs in accordance with
Schedule 6 of the WorkCover Queensland Regulation 1997."

There are two questions raised by this application. One, 30
whether the proper construction of Division 2, Part 7 of the
Regulation entitles the applicant to costs pursuant to
Regulation 79. Two, if it did, whether the respondent's
proffering of the discharge and applicant's execution of it, 40
limit the costs otherwise recoverable to those pursuant to
Regulation 78.
The offer of settlement which was accepted according to its
terms was for WorkCover to pay the applicant's costs 50
calculated in accordance with Division 2 of Part 7 of the
Regulation. There are two regimes for costs under Division 2
of Part 7 of the Regulation.

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

Regulation 78 prescribes the costs of a claim before a 1

proceeding is started. Regulation 79 prescribes the costs of a claim after a proceeding is started. Clause 2 of the offer of settlement does not expressly stipulate which regime was
intended to be invoked. The language of clause 2 of the offer

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of settlement, however, suggests that it was intended to apply
the regime of costs applicable to the applicant's claim. The
alternatives set out in Division 2 of Part 7 of the Regulation
depend on whether or not the proceeding has started.

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Which method of calculating costs is applicable to the applicant's claim, prima facie, depends on whether or not the proceeding was started. Although the applicant's proceeding was stayed at the time the offer of settlement was made and then agreed, the proceeding had started. The use of the

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expression, "proceeding is started" in Division 2 of Part 7,
is comparable with the language used in chapter 5 of the Act.
It is argued on behalf of the respondent, that the proceeding was commenced by the applicant only because of the tardiness

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of the applicant leaving it to take steps to pursue a claim
until the limitation period was about to expire, and that
Regulation 79 should be construed as applying to a proceeding
which has started after the process prescribed by Parts 5 and
6 of chapter 5 has been followed, and not a proceeding

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instituted pursuant to section 262 subsection 4 of the Act.
It is submitted on behalf of the respondent that it is
consistent with the Act as a whole, and particularly with the

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

requirements in section 262 subsection 4 of the Act that the 1
plaintiff complete the processes provided by parts 5 and 6 of
chapter 5 before proceeding with the action, that the
proceeding not be treated as started until parts 5 and 6 of
chapter 5 have been complied with. Given that the obvious

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purpose of the Act and Regulation is to see the early
resolution of claims, it is also submitted on behalf of the
respondent that it is entirely inconsistent with such a
purpose to reward the applicant for the consequences of his
own tardiness.

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As a matter of construction, however, the alternatives in division 2 of part 7 of the Regulation make the distinction only between costs where the claim is settled before the proceeding is started and costs after the proceeding is

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started. There is no ambiguity in division 2 of part 7 of the Regulation. It is artificial to attempt to make Regulation 79 qualified by excluding from its application a proceeding that
is started before the processes prescribed by parts 5 and 6 of
chapter 5 have been completed.

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It was pointed out that if Regulation 79 were applicable in this case, the applicant's costs were in the vicinity of $12,000, but if Regulation 78 were applicable, the applicant's costs were limited to around $5,000.

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I do not accept that the issue should be resolved by
considering the issue of the applicant's tardiness. It is a
question of what the parties agreed upon. The agreement that

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

was reached on 24 March 2003 was in terms of clause 2 of the 1
offer of settlement. The respondent was not compelled to
accept the offer in the terms in which it was made. The
respondent did so. It is therefore a question of construing
clause 2 of the offer of settlement.

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I conclude that what the parties agreed upon was that the costs of the applicant were to be calculated in accordance with division 2 of part 7 of the Regulation. As the applicant's proceeding had commenced, it is Regulation 79

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which is applicable, and that is what the parties agreed upon. raised by the application.
It is argued on behalf of the respondent that the discharge

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provides for the costs to be calculated in accordance with displaces the agreement that was reached by the exchange of correspondence between the parties. The discharge was intended by the parties to be signed in order to carry out the

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terms of the agreement on which a final agreement had been
made. There is no consideration moving from the respondent to
vary the terms that were agreed upon when the respondent's
solicitors, in their letter dated 24 March 2003, accepted the
offer of settlement from the applicant dated 11 March 2003.

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The applicant therefore cannot be taken to have replaced that binding agreement with the lesser terms which are encompassed in the discharge for which no consideration has moved from the

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31072003 T16/HMH14 M/T 2/2003 (Mullins J)

respondent. The discharge does not have the effect of varying 1
the terms of the final agreement that was reached by the
parties in respect of which the discharge was intended merely
to document. It follows that the applicant is entitled to the
declaration which it seeks.

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On the question of costs, the applicant seeks an order that the respondent pays its costs of the application. There is no impediment in the Act to making such an order and no contrary submission is put forward on behalf of the respondent. It is

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appropriate that, as the applicant had to bring an application
in order to resolve the difference between the parties over
the construction of the agreement reached between them and the
applicant has been successful in the construction for which he
has contended, the applicant have his costs.

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The orders which I make are:
(1) It is declared that upon the proper construction of the
document entitled "Offer of Settlement" signed by the
applicant and dated 11 March 2003 and accepted by the

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respondent on 24 March 2003, the applicant is entitled to
recover against the respondent his costs of this proceeding in
accordance with section 79 of the WorkCover Queensland
Regulation 1997;
(2) The respondent pay the applicant's costs of and

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incidental to this application, to be assessed.
...

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THOMAS WILLIAM REW	Plaintiff
and
VISIONSTREAM PTY LTD	Defendant
(ACN 062 604 193)
BRISBANE ..DATE 31/07/2003
ORDER

HER HONOUR: This is an application for a declaration that	1
upon the proper construction of a document entitled, "Offer of accepted by the defendant on 24 March 2003, the applicant is entitled to recover against the respondent, his costs in

was made unconditional by WorkCover and the applicant had	1
complied with Parts 5 and 6 of the Act.
The applicant's notice of claim was given on 24 July 2002. On 11 March 2003, the parties participated in a compulsory

for the applicant. It was signed by the applicant on 31 March	1
2003 and returned by the applicant's solicitors to the
respondent's solicitors under cover of a letter of the same
date. The discharge is in form an agreement which purports to
document the settlement agreed upon between the applicant and	10
the respondent and to which WorkCover is also named as a party.
Clause 2 of the discharge provides:
20

There are two questions raised by this application. One,	30
whether the proper construction of Division 2, Part 7 of the
Regulation entitles the applicant to costs pursuant to
Regulation 79. Two, if it did, whether the respondent's
proffering of the discharge and applicant's execution of it,	40
limit the costs otherwise recoverable to those pursuant to Regulation 78.
The offer of settlement which was accepted according to its
terms was for WorkCover to pay the applicant's costs	50
calculated in accordance with Division 2 of Part 7 of the
Regulation. There are two regimes for costs under Division 2
of Part 7 of the Regulation.

Regulation 78 prescribes the costs of a claim before a	1
proceeding is started. Regulation 79 prescribes the costs of a claim after a proceeding is started. Clause 2 of the offer of settlement does not expressly stipulate which regime was
intended to be invoked. The language of clause 2 of the offer

requirements in section 262 subsection 4 of the Act that the	1
plaintiff complete the processes provided by parts 5 and 6 of chapter 5 before proceeding with the action, that the proceeding not be treated as started until parts 5 and 6 of chapter 5 have been complied with. Given that the obvious

was reached on 24 March 2003 was in terms of clause 2 of the	1
offer of settlement. The respondent was not compelled to accept the offer in the terms in which it was made. The respondent did so. It is therefore a question of construing clause 2 of the offer of settlement.

respondent. The discharge does not have the effect of varying	1
the terms of the final agreement that was reached by the parties in respect of which the discharge was intended merely to document. It follows that the applicant is entitled to the declaration which it seeks.