Victorian WorkCover Authority v BSA Limited and Ors [No 2](according to the attached Schedule)

[2017] VSCA 337

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2017 0065

VICTORIAN WORKCOVER AUTHORITY	Appellant
v
BSA LIMITED & ORS [No 2] (according to the attached Schedule)	Respondents

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JUDGES:	MAXWELL P, OSBORN and KAYE JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	Determined on the papers
DATE OF JUDGMENT:	21 November 2017
MEDIUM NEUTRAL CITATION:	[2017] VSCA 337

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PRACTICE – Costs – Judicial review – Interlocutory ruling in Magistrates’ Court – No right of appeal – Appellant sought judicial review – Undesirable fragmentation of proceedings – Leave to appeal granted only because point of general importance – No order for costs of appeal – Kuek v Victoria Legal Aid (2001) 2 VR 289 applied – Supreme Court (General Civil Procedure) Rules 2015 O 56.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr S A O’Meara QC with Mr S E Gladman	Minter Ellison
For the Respondents	Mr N T Robinson QC with Ms C M Harris	Aitken Partners

MAXWELL P
OSBORN JA
KAYE JA:

1. On 28 September 2017, the Court allowed an appeal by the Victorian WorkCover Authority (the ‘Authority’) against a decision of a judge of the Trial Division.[1] The issue for determination concerned the proper construction of s 71(4) of the Workplace Injury Rehabilitation and Compensation Act 2013, which confers rights of subrogation on the Authority.

   [1]Victorian WorkCover Authority v BSA Ltd & Ors [2017] VSCA 276 (‘Reasons’).

1. The procedural history of the matter is set out in the reasons for judgment.  Relevantly, the second respondent (‘Mr Nikolovski’) had commenced proceedings in the Magistrates’ Court against the first respondent (‘BSA’) in respect of an alleged workplace injury.  Over the Authority’s objection, the magistrate had adjourned the proceeding to allow for evidence to be given concerning Mr Nikolovski’s employment status. 

1. The Authority challenged this procedural decision by way of an originating motion seeking relief pursuant to O 56 of the Supreme Court (General Civil Procedure) Rules 2015. The Authority sought an order quashing the magistrate’s ruling, on the basis that it disclosed an error of law on the face of the record, or alternatively a declaration that it was entitled to continue to conduct the proceeding on behalf of BSA. No appeal lay pursuant to s 109 of the Magistrates’ Court Act 1989 because the ruling constituted an interlocutory decision and was not, in terms of that provision, ‘a final order of the court in that proceeding’.[2]

   [2]Magistrates’ Court Act 1989 s 109(1).

1. The trial judge made the following observations concerning the O 56 proceeding:

The effect of the Authority’s action in issuing an O 56 proceeding following the ruling by the Magistrate to hear evidence is to fragment the hearing of the interlocutory applications before the Magistrate, and to deprive the Magistrate of the opportunity to give his reasons and make orders. The Authority might have won before the Magistrate had the Magistrate been permitted to hear evidence and conclude his hearing of the applications. The issues now raised by the Authority would have been just as strong as grounds in a judicial review proceeding at the conclusion of the applications after reasons had been given and orders made by the Magistrate.

…

As stated in Kuek, O 56 proceedings should not be conducted so as to fragment proceedings in inferior courts such as the Magistrates’ Court without good reason. It is hard to see any justification for the very early intervention of the Supreme Court sought by the Authority, or any reason why the Magistrate should not have been permitted to hear evidence, complete the hearing, publish his reasons and make orders in the applications. However, in view of the fact that the Authority has failed in the points that it has raised, it is unnecessary to consider further whether relief should be refused.[3]

[3]Victorian WorkCover Authority v BSA Limited & Ors [2017] VSC 224 [63]–[65] (citations omitted).

1. Although the Authority’s appeal succeeded, we endorsed those observations, saying:

It can only be in an exceptional case that this Court should intervene in procedural decisions made in the course of a proceeding before the Magistrates’ Court. The policy which underlies s 109 of the Magistrates’ Court Act 1989 is clear:  the right of appeal on a question of law does not arise until a final decision has been made.  That policy should be given effect to.  The Court should not be asked to circumvent that policy by exercising its powers of judicial review unless there is an overwhelming reason of justice for doing so.[4]

[4]Reasons [10].

1. Notwithstanding that principle, however, we entertained the application for leave, for the following reasons:

In the present case, however, the ultimate question of statutory construction, which was agitated first in the Trial Division and which has now been argued before this Court, is one of general importance for the administration of the Act.  Given that the question has been fully argued, and has already been the subject of considered determination by a single judge of this Court, it is appropriate that we decide it now, rather than leave it unresolved for ongoing contention.[5]

[5]Reasons [11]; see Kuek v Victoria Legal Aid (2001) 2 VR 289, 293 [16].

1. The costs of the appeal were reserved.  In subsequent written submissions, BSA contended that the Authority should pay the costs of the appeal, in part because of ‘the public importance in the determination of this issue of construction’.  There was, it was said, ‘an element of a test case’ to this proceeding.  Further, BSA submitted, the rejection of the Authority’s arguments at first instance made it reasonable for BSA to defend the judgment on appeal.

1. The Authority, for its part, submitted that costs should follow the event, in view of its complete success on the appeal over BSA’s active opposition.  As to the general importance of the question under consideration, the Authority drew attention to appellate authorities pointing out that it is common for court decisions to have implications beyond the interests of the parties and that this does not, or does not necessarily, justify a departure from the usual rule as to costs.[6]

   [6]Hollier v Australian Maritime Safety Authority [No 2] [1998] FCA 975; Weinstein v Medical Practitioners Board of Victoria [No 2] (2008) 21 VR 29, 41 [8].

Conclusion

1. In our view, the appropriate outcome is that there be no order as to the costs of the application for leave to appeal and of the appeal. 

1. Given the inappropriateness of the judicial review proceeding, as set out earlier, we do not consider that the Authority should have its costs paid.  As we have mentioned, ordinarily this Court would not entertain an application for leave to appeal an interlocutory decision that would involve a fragmentation of the case at first instance.  We only did so in this case because of the general importance of the point that was raised.  That issue having been fully agitated in argument, it was appropriate to grant the applicant an indulgence, by giving leave, in order that it be resolved.  If it were not for that consideration, we would have refused the application for leave.

1. Equally, given that the proceeding only became necessary because BSA erroneously disputed the right of the Authority to conduct the defence of the Magistrates’ Court proceeding, we would not make an order for costs in BSA’s favour. 

1. We would, however, order that BSA pay the costs of Mr Nikolovski.  But for the erroneous position adopted by BSA in the Magistrates’ Court, Mr Nikolovski would not have incurred those costs.

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SCHEDULE OF PARTIES

VICTORIAN WORKCOVER AUTHORITY	Appellant
- and -
BSA LIMITED	First Respondent
ALEN NIKOLOVSKI	Second Respondent
THE MAGISTRATES’ COURT OF VICTORIA	Third Respondent