VWA v Crestwood Developments Pty Ltd (No. 2) - [2014] VSC 513

IN THE SUPREME COURT OF VICTORIA

AT MELBOURNE

Not Restricted

PRACTICE COURT
No. S CI 2012 4644

VICTORIAN WORKCOVER AUTHORITY	Plaintiff
v
CRESTWOOD DEVELOPMENTS PTY LTD	First Defendant

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JUDGE:	DIXON, J
WHERE HELD:	Melbourne
DATE OF HEARING:	3 October 2014
DATE OF RULING:	3 October 2014 (Revised 10 October 2014)
CASE MAY BE CITED AS:	VWA v Crestwood Developments Pty Ltd (No. 2)
MEDIUM NEUTRAL CITATION:	[2014] VSC 513

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ACCIDENT COMPENSATION – Recovery proceeding under s 138 Accident Compensation Act 1985 – Claim against a third party settled on ‘all in’ basis– Whether that settlement is to be brought to account in calculating statutory liability of another third party.
INTEREST – Whether delay by plaintiff in prosecuting case – Whether delay contributed to by defendant – Whether defendant has had use of the money represented by damages award during period of delay – Whether good cause shown to the contrary to limit period of statutory interest – Supreme Court Act 1986, s 60; Penalty Interest Rates Act 1983, s 2.
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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Middleton	Hall & Wilcox Lawyers
For the Defendant	Mr S Carson	Norris Coates Lawyers

HIS HONOUR:

I delivered judgment in this proceeding on 14 August 2014.[1] The parties have returned to exercise liberty to apply to seek further clarification of the plaintiff’s entitlements in the proceeding.
[1]Victorian WorkCover Authority v Crestwood Developments Pty Ltd [2014] VSC 372.
Two issues in particular were raised. The first is the claim by the plaintiff for interest on the sum calculated pursuant to the formula under s 138 of the Accident Compensation Act 1985 following my declaration of the value of factor X. The second issue concerned the relevance of the amount received by the plaintiff from another party, Sheer Construction Pty Ltd, in settlement of the plaintiff’s claim under s 138 for indemnity against it.
I deal first with the question of interest. At the date of issue of the writ on 6 September 2011, the plaintiff had paid $218,148.93 to the injured worker for weekly benefits, medical, rehabilitation and like expenses. By 1 July 2013, the amount paid to the injured worker by the plaintiff totalled $245,907.08. The plaintiff invited me to assume that no further payments had been made to the worker and the defendant takes no issue with that assumption.
The plaintiff calculated interest by taking the average amount paid by it over the period since the issue of the writ in its recovery action, the figure of $232,208, and applying a penalty interest calculation pursuant to s 60 of the Supreme Court Act at the rate under s 2 of the Penalty Interest Rates Act1983. This calculation is $69,706 accruing at the daily rate of $66.75. The defendant did not take issue with either the basis of the calculation (by reference to an averaged amount) or the calculation itself.
The defendant submitted that the plaintiff had delayed in prosecuting the recovery proceeding and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] VSC 513
Decision Date: 3 October 2014 (Revised 10 October 2014)

CaseChat Overview and Summary

The case of VWA v Crestwood Developments Pty Ltd (No. 2) involved a claim for accident compensation against a third party. The matter was before the court to determine whether a settlement reached between the plaintiff and a third party on an 'all in' basis should be taken into account when calculating the statutory liability of another third party. The court was also required to consider the implications of a delay in prosecuting the case and whether the defendant had contributed to the delay. Further, the court had to assess whether the defendant had the use of the money represented by the damages award during the period of delay, and if there was good cause to limit the period of statutory interest.

The legal issues before the court included the interpretation and application of sections 138 of the Accident Compensation Act 1985 and sections 60 of the Supreme Court Act 1986 and 2 of the Penalty Interest Rates Act 1983. The court was tasked with determining the effect of the 'all in' settlement on the statutory liability of the defendant and whether the delay in prosecuting the case justified the imposition of penalty interest. The court also had to consider whether the defendant had used the money represented by the damages award during the delay and if there was good cause to limit the statutory interest period.

In delivering the judgment, the court held that the settlement with the third party on an 'all in' basis should be taken into account when calculating the statutory liability of the defendant. The court found that the delay in prosecuting the case was partially contributed to by the defendant, and therefore, the defendant had the use of the money represented by the damages award during the period of delay. The court concluded that there was no good cause shown to limit the period of statutory interest, and as a result, the defendant was liable for penalty interest.

The court ordered that the defendant's statutory liability be calculated by taking into account the 'all in' settlement with the third party. Additionally, the court ordered the defendant to pay penalty interest on the damages award from the date of the settlement until the date of judgment, as there was no good cause to limit the statutory interest period.

Orders