Victorian WorkCover Authority v City of Port Phillip, Kane
[2010] VCC 1466
•12 October 2010
| IN THE COUNTY COURT OF VICTORIA | Revised |
Not Restricted
AT WARRNAMBOOL
CIVIL DIVISION
DAMAGES – COMPENSATION
GENERAL DIVISION
Case No. CI-09-01916
| VICTORIAN WORKCOVER AUTHORITY | Plaintiff |
| v | |
| CITY OF PORT PHILLIP | First Defendant |
| and | |
| KANE CONSTRUCTIONS PTY LTD | Second Defendant |
| and | |
| 350Q BBS PTY LTD | Third Defendant |
| (formerly BURNS BRIDGE SERVICES PTY LTD) |
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| JUDGE: | HIS HONOUR JUDGE O'NEILL |
| WHERE HELD: | Warrnambool |
| DATE OF HEARING: | 9 September 2010 |
| DATE OF RULING: | 12 October 2010 |
| CASE MAY BE CITED AS: | Victorian WorkCover Authority v City of Port Phillip, Kane Constructions Pty Ltd and 350Q BBS Pty Ltd (Ruling) |
| MEDIUM NEUTRAL | [2010] VCC 1466 |
| CITATION: |
RULING
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Catchwords: ACCIDENT COMPENSATION – Recovery action pursuant to s.138 Accident
Compensation Act 1985 – Bullock Order.
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| APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J C Simpson | Russell Kennedy |
| For the First Defendant | Mr T J Casey QC with | DLA Phillips Fox |
| Mr A J Fraatz | ||
| For the Second Defendant | Mr D R Myers with | Wotton & Kearney |
| Mr D McWilliams | ||
| For the Third Defendant | Mr R W Dyer | Moray & Agnew |
| HIS HONOUR: |
1 In proceeding number CI-09-05565, (“the principal proceeding”) Peter Threlfall (“the worker”) brought proceedings against the following parties seeking damages for personal injury sustained in the course of his employment:
• First defendant: TBS Building Services Pty Ltd (“TBS”) – the employer. • Second defendant: Kane Constructions Pty Ltd (“Kane”) – the builder undertaking construction work at the premises. • Third defendant: Port Phillip City Council (“Port Phillip”) – the occupier of the premises. • Fourth defendant: 350Q BBS Pty Ltd (“BBS”) – BBS responsible for project management of construction work at the premises. 2 After a trial before a judge and jury of six, the jury found negligence on the part of TBS, Kane and Port Phillip. BBS was found not to be negligent. Further, the jury apportioned liability as between the defendants on the following basis:
TBS - 60 per cent Port Phillip - 35 per cent Kane - 5 per cent.
3 Accordingly, judgment was entered for the plaintiff in accordance with the verdict of the jury, and orders made as to costs.[1]
[1] See Order made 8 September 2010
4 Amongst the orders made was the following:
“4 The plaintiff pay the fourth defendant’s costs, including reserve
costs on Scale ‘D’.Certify:
(a)
Fee upon brief for Counsel at $3,765.00 with twelve refreshers at $2,510.00.
(b) Fee for preparation and conferences at $3,300.00. (c) For the fourth defendant’s share of the costs of the transcript. 5
Subject to further order, or to settlement or final determination of the contribution and/or third party proceedings herein, the first, second and third defendants indemnify the plaintiff in respect of the order for the fourth defendant’s costs herein, in proportion with the assessment by the jury as to their respective negligence … .”
5 This proceeding is a recovery proceeding pursuant to the provisions of s.138 of the Accident Compensation Act 1985 (“the recovery proceeding”). Upon the conclusion of the principal proceeding, the recovery proceeding was resolved and various orders made.[2] Included amongst those orders was an order that the plaintiff (VWA) pay BBS’s costs of the recovery proceeding. A further order was made that Port Phillip and Kane pay the VWA’s costs of the recovery proceeding in the same proportion as the jury had found those parties responsible in the principal action.
[2] See Orders made 9 September 2010
6 Mr Simpson, on behalf of the VWA, made application for an order in the same terms as was made in the principal proceeding, that Port Phillip and Kane indemnify the VWA in respect of the order made against it in favour of BBS. He submitted that the recovery proceeding was no different from the principal proceeding, in that in the circumstances of the case, it was reasonable that his client issue the recovery proceeding, inter alia, against BBS and that his client ought be entitled to indemnity from the unsuccessful defendants, Port Phillip and Kane, in respect of the costs of the winning defendant. Obviously, the recovery proceeding was instituted well before the outcome of the principal proceeding was known.
7 It was contended on behalf of Port Phillip and Kane that it was not appropriate to make a Bullock order in the recovery proceeding given:
•
the VWA’s right to recovery is a statutory right and not a common law right; and
•
the VWA’s claim against each defendant is assessed in accordance with s.138(3)(b) so that, in contrast to common law proceedings, an amount is calculated in accordance with the formula provided in that section, and the defendants are not jointly nor severally liable in the recovery proceeding.
8 The law provides that where there are multiple defendants, the Court may order a losing defendant indemnify the plaintiff’s costs payable to a winning defendant. The granting of such an order, known as a “Bullock order”, is discretionary.[3] The authorities indicate that a Bullock order will not usually be made unless:
[3] Hong v A & R Brown Ltd [1948] 1 KB 515
[4] See Fassbender v HW & MTA Bohlmann t/as Seymour Freight Lines & Caravans [2010] VSCA 204, per Warren CJ and Emerton AJA at paragraph 71, Nettle JA concurring; Berrigan Shire Council v Ballerini [2006] VSCA 65; and Berrigan Shire Council and State of Victoria v Horvath (No 2) [2003] VSCA 24
(i) the plaintiff’s claim against the defendants is interdependent or essentially an alternative claim; (ii) it was reasonable for the plaintiff to have joined the winning defendant and the conduct of the unsuccessful defendant(s) has been such as to make an order just.[4] 9 In Lackersteen v Jones & Ors (No 2),[5] Ashe CJ formulated four principles to be considered when making a Bullock order, namely:
[5] (1988) 93 FLR 442
(i)
It must be seen to have been reasonable and proper for the plaintiff to have sued the successful defendant;
(ii)
The causes of action against two or more defendants need not be the same but they must be substantially connected or dependant the one upon the other;
(iii)
While it is essential to find that the plaintiff has acted reasonably and properly that alone is not sufficient. The Court must find something in the conduct of the unsuccessful defendant which makes it a proper exercise of discretion.
In Gould v Vaggelas,[6] Gibbs CJ said:[7]
“… Obviously a judge should make a Bullock order only if he considers it is just that the costs of the successful defendant should be borne by the unsuccessful defendant, and, if nothing that the unsuccessful defendant has said or done has led the plaintiff to sue the other defendant, who ultimately was held not to be liable, it is difficult to see any reason why the unsuccessful defendant should be required to pay for the plaintiff's error or overcaution.”
(iv) Finally, in considering whether to make such an order, the Court should, in exercise of its discretion, balance overall two considerations of policy: the first, that an unnecessary multiplicity of actions should not be forced on litigants, so that a plaintiff who acts reasonably in joining two or more defendants should not be penalised or lose the fruits of his victory in costs on the basis that he should have either elected or taken separate actions; secondly, that an unsuccessful defendant should not have to pay more than one set of costs merely because he is unsuccessful.
[6] (1984) 58 ALJR 560
[7] at 566
10 The plaintiff’s justification for joining the winning defendant may have to be assessed in the light of the knowledge the plaintiff and his or her lawyers had at the time of joinder, although circumstances of the case may require the joinder decision to be judged by events after joinder.[8]
[8] See Johnson’s Tyne Foundry Pty Ltd v Maffra Shire Council (1948) 77 CLR 544; Altamura v Victorian Railways Commissioners [1974] VR 33
11 In Cox Constructions Pty Ltd v Dawes & Ors,[9] the South Australian Supreme Court accepted that the WorkCover Authority was justified in bringing recovery proceedings (even although ultimately they did not need to do so) on the basis that at the time of initiating proceedings, they could not know the outcome of the primary proceedings and needed to make allowance for the applicable statute of limitations. The same considerations apply to this recovery proceeding.
[9] [1999] SASR 229
12 I am satisfied that the claim brought by the VWA against BBS was “interdependent” or “alternative”.
13 In the principal proceeding, there was significant evidence that the contract between Port Phillip and BBS required, in part, for it to identify and take all necessary precautions for the health and safety of all persons who were affected by the performance by BBS of its services.
14 Thus I am satisfied the first requirement for a court to make a Bullock order is met.
15 The next question is whether it was reasonable for the VWA to join BBS.
16 I am not persuaded by the claims of Port Phillip and Kane that the fact that the VWA’s right to recovery is a statutory right, or that its entitlement to recovery is not joint and several amongst the defendants, but rather in accordance with the formula prescribed, are matters relevant to the determination of the reasonableness of the VWA’s decision to join BBS.
17 At the time of the issue of the recovery proceedings, the VWA did not, of course, know of the outcome of the principal proceeding. Because of limitation of time requirements, it was necessary to issue the proceeding at the time it did in order to avoid some or all of the claim it had being statute barred. Its view of the appropriate parties to proceed against in the recovery proceeding was no doubt influenced by the fact that the worker in the principal proceeding had issued against those same parties. The VWA’s knowledge of the facts and circumstances giving rise to the worker’s injury, and the responsibility of the various parties therefor, was somewhat limited. It no doubt had the advantage of obtaining instructions from TBS, the worker’s employer, but in the circumstances of the case, it was not to know the full detail of the role played by the various other parties, including Port Phillip, Kane and BBS. If it failed to issue against one of those parties, it faced the prospect of other defendants attempting to reduce their own liability by attributing blame to another party not a defendant in the proceeding without the disadvantage of that party being able to respond.
18 In the circumstances of the recovery proceeding, in my view it was reasonable, given the knowledge of the VWA at the time, to join BBS as a defendant. However, that is not the end of the matter. It is further necessary to consider whether something in the conduct of the unsuccessful defendants make it proper to exercise the Court’s discretion.[10] In Gould, Gibbs CJ said:[11]
“The ground on which a Bullock order may be made is, in my opinion, more accurately stated in a passage in Sanderson v Blyth Theatre Co [1903] 2 KB 533 at 539, which was cited with approval in Bullock v London General Omnibus Co [1907] 1 KB 264 at 272 and Hong v A & R Brown Ltd [1948] 1 KB 515 at 522, viz. that the costs which the plaintiff has been ordered to pay to the defendant who succeeded, and which the plaintiff recovers from the defendant who has failed ‘are ordered to be paid by the unsuccessful defendant, on the ground that … those costs have been reasonably and properly incurred by the plaintiff as between him and the [unsuccessful] defendant’. In Johnsons Tyne Foundry Pty Ltd v Maffra Corporation, … Williams J, at pp 572–3, stated the principle in a similar way, and Starke and Dixon JJ, in giving their reasons for making a Bullock order, both relied on the circumstances that the attitude adopted by the successful defendant had induced the plaintiff to join the other defendant: see at pp 559–60, 566. In my respectful opinion the true position was clearly stated by Blackburn CJ in Steppke v National Capital Development Commission (1978) 21 ACTR 23 at 30–1, when he said that ‘there is a condition for the making of a Bullock order, in addition to the question whether the suing of the successful defendant was reasonable, namely that the conduct of the unsuccessful defendant has been such as to make it fair to impose some liability on it for the costs of the successful defendant’.”
[10] See Gould v Vaggelas (supra) at 566
[11] at 566
19 That passage has been cited with approval by the Victorian Court of Appeal.[12]
[12] See McCracken & McCracken v Pippett & Groenwald [2000] VSCA 20, per Callaway JA at paragraph 11
20 In McCracken, Callaway JA stated:13
“…In truth there is a single question, namely whether it is fair, as between the plaintiff and the unsuccessful defendant, that the latter should pay the successful defendant's costs. Prima facie, the unsuccessful defendant should not have to do so. There must, as Gibbs CJ and Blackburn CJ recognized, be something about his or her conduct that makes it appropriate to shift the incidence of the successful defendant's costs. The plaintiff, after all, has been unsuccessful too.”
21 Further, Callaway JA, in Berrigan Shire Council v Ballerini,14 explained:
“There are two principal issues to be resolved. The first is whether the plaintiff’s claim against the Commission was interdependent with, or in a real sense alternative to, his claim against the Council. The second issue is whether it was reasonable for the plaintiff to have joined the Commission and whether the Council’s conduct was such as to make it just to require the Council to pay the Commission’s costs. It will be apparent that that second issue sometimes involves two questions, but in truth it is a matter of convenience whether to adopt a two-step analysis or to ask a single question, namely whether it is fair, as between the plaintiff and the unsuccessful defendant, that the latter should pay the successful defendant’s costs. Translated into the circumstances of this case, the single question relating to the second issue would be whether it is fair, as between the plaintiff and the Council, that the Council should pay the Commission’s costs.”
22 In the course of argument before me, I was not provided with any evidence nor submission as to the conduct of the unsuccessful defendants, particularly as to whether any act or omission on their part led to the joinder of BBS. In particular, I was provided with no information as to whether the City of Port Phillip or Kane made any representations to the VWA as to whether or not it was appropriate to join BBS. To that extent, I am provided with no information as to whether the conduct of the City of Port Phillip or Kane acted reasonably or otherwise in the circumstances of the case. In my view, without such information, I am unable to conclude, in accordance with the principles established by Gould and McCracken, that there was any conduct on the part of the unsuccessful defendants which made it reasonable for a Bullock order to be made against them. It is not relevant that such an order was made in the principal proceeding, as such order was made by consent of the parties.
23 In such circumstances, I am of the view it is not appropriate for such an order
(supra) at paragraph 11
(supra) at paragraph 13
to be made against Port Phillip and Kane to indemnify the VWA against the
costs order in respect of BBS.
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