Howard v Accident Compensation Corporation
[2024] NZHC 699
•27 March 2024
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2023-485-000126
[2024] NZHC 699
UNDER The Accident Compensation Act 2001 (the Act) IN THE MATTER OF
An application for special leave to appeal – s 163(3)
BETWEEN
MAREE EILEEN HOWARD
Applicant
AND
ACCIDENT COMPENSATION CORPORATION (ACC)
Respondent
Hearing: On the Papers Appearances:
Applicant self-represented P McBride for Respondent
Judgment:
27 March 2024
JUDGMENT OF CULL J
[Costs]
Introduction
[1] In a judgment dated 5 July 2023 (“the leave judgment”), I dismissed Ms Howard’s application for leave to appeal a District Court decision and granted leave to the parties to file memoranda on costs.1 The parties have each filed memoranda accordingly.
1 Howard v Accident Compensation Corporation [2023] NZHC 1734.
HOWARD v ACCIDENT COMPENSATION CORPORATION (ACC) [Costs] [2024] NZHC 699 [27 March 2024]
[2] The Accident Compensation Corporation (“ACC”) seeks costs against Ms Howard on a 2B basis.
Background
[3]I canvassed the background in the leave judgment, which I reproduce here:2
[3] Ms Howard suffered two ACC-covered spinal injuries, the first in 2006, and the second in 2007. She worked for New Zealand Post at the time, who was an accredited employer and whose work-accident claims were managed by Care Advantage.
[4] On 27 May 2010, Ms Howard committed to and signed an Individual Rehabilitation Plan (IRP). Care Advantage sought medical advice about vocational rehabilitation for Ms Howard, and referred her to Dr Courtney Kenny, an occupational physician, for an assessment. At the appointment, Ms Howard and her husband questioned Dr Kenny’s suitability to assess her and because of their objections, agreed not to conduct the assessment.
[5] On 11 November 2010, Care Advantage wrote to Ms Howard recording what occurred. Care Advantage noted that the appointment had been arranged in accordance with s 72 of the [Accident Compensation Act 2001]. Section 72 provides that a claimant who receives any entitlement must, when reasonably required to do so by ACC, undergo assessment by a registered health professional specified by ACC, at ACC’s expense.
[6] In its letter, Care Advantage advised that Ms Howard had been provided with information about the consequences of not attending or not completing the assessment on several occasions. Accordingly, Care Advantage made the decision under s 117 to suspend Ms Howard’s ACC entitlements. Section 117 allows ACC to decline to provide any entitlement for as long as the claimant unreasonably refuses or unreasonably fails to: comply with any requirement of the Act; or agree to, or comply with, an individual rehabilitation plan.
[7] Care advantage’s letter set out Ms Howard’s options for internal review through her employer, and her rights for formal review.
[8] Ms Howard unsuccessfully applied for a review, and then appealed to the District Court. By judgment dated 29 June 2012, Judge Ongley dismissed the appeal on the basis the decision to suspend Ms Howard’s entitlement was correct. Ms Howard unsuccessfully appealed Judge Ongley’s decision to the High Court, Court of Appeal, and the Supreme Court.
The settlement agreement
[9] On 30 July 2021, Ms Howard and ACC entered into a settlement agreement whereby ACC made an ex gratia payment of $19,200.00 to Ms Howard (the Settlement Agreement). In cl 9 of the Settlement Agreement, the parties acknowledge that they had the opportunity to seek independent legal advice as to the content and effect of the Settlement Agreement, prior to
2 Howard v ACC, above n 1.
signing. At cl 1, Ms Howard acknowledged and agreed she had no outstanding entitlement to the date of the Agreement. Under cl 4, Ms Howard agreed that she would not personally or by any agent, representative, or by proxy, initiate or be involved in any further action, claim, application, proceeding or complaint in relation to any entitlements, or any issues in any way related to cover, existing down to the date of settlement. Under cl 6, the ex gratia payment was to be in “full and final settlement” of all claims, issues or complaints having arisen, whether known or not known to the parties, down to the date of settlement.
[10] ACC made the ex gratia payment to Ms Howard.
Further compensation claims
[11] Less than a month after ACC’s performance of the Settlement Agreement, Ms Howard asked ACC to consider making a further payment, for the period between 11 November 2010 and 9 April 2012. ACC responded to her request on 14 September 2021, noting:
We have mutually agreed on the full and final settlement of all issues Maree has had with ACC. We have been reasonable in paying her full entitlement for the full period of suspension. ACC will therefore not be progressing this and we see matters as fully concluded between Maree and ACC.
[12] Ms Howard responded by clarifying that her claim for a further weekly compensation entitlement was for the period between 26 November 2010 and 9 April 2012 and asked ACC to “issue an ACC written decision.” On 21 September 2021, ACC wrote back saying:
ACC’s position is that the weekly compensation you have requested as already been the subject of previous review and court decisions. This weekly compensation is also subject to the full and final settlement agreement which you signed 30 July 2021.
Therefore, ACC will not be issuing any further decision, or engaging in any further correspondence in regard to this matter. ACC has worked in good faith with you through the settlement process and is of the view that the matter is closed off by that process.
[13] Ms Howard applied for a review of the 2010 IRP in October 2021. She advanced that her rehabilitation needs under the IRP had not been implemented. Ms Howard also applied for a review of ACC’s response to her request for further compensation, dated 14 September 2021, set out above at [11]. She contended that ACC’s response, and its ex gratia payment was amenable to review, and sought payment for the full period of suspension. A statutory reviewer commenced review proceedings on 25 February 2022, and on 21 March 2022 the reviewer dismissed the review because there was no reviewable decision, and the surrounding circumstances were fatal to Ms Howard’s claims.
Judge Spiller’s decision
[14] Ms Howard appealed the reviewer’s decision to the District Court under s 149 of the Act. On 18 August 2022, Judge Spiller dismissed the appeal for lack of jurisdiction.
[15] In discussing the effect of the settlement agreement of 30 July 2021, the Judge noted s 299 of the Act which provides that the Act has effect despite any provision to the contrary in any contract or agreement. The Judge put the agreement to one side for the purpose of determining the appeal.
[16] The Judge found that Ms Howard’s claim that the IRP had not been implemented was moot because of ACC’s decision to suspend her entitlements in 2010. Rehabilitation is one of the entitlements provided by the Act. Upon suspending Ms Howard’s entitlements, ACC was not required to implement her IRP. The suspension was correct, and thus there was no jurisdiction for the Judge to consider Ms Howard’s claim for review of the IRP.
[17] The Judge found that ACC’s correspondence of 14 September 2021 did not constitute a reviewable decision. In particular, Ms Howard’s own response to ACC’s email of 14 September 2021, included a request for ACC to issue a written decision. ACC’s follow up email on 21 September 2021 confirmed that it would not be issuing any further decision. The Judge held that Ms Howards further request for compensation was an attempt to relitigate the claim which she unsuccessfully pursued against the 2010 decision which the courts confirmed was correct.
Leave to appeal to High Court
[18] Ms Howard then applied for leave to appeal against the District Court decision under s 162(1) and (2) of the Act. Judge Henare declined leave on the basis that the reasons of Judge Spiller “far surpass any inadequacy that might comprise error of law”.
[19] The Judge went through each of Ms Howard’s grounds, and carefully considered Judge Spiller’s findings. The Judge concluded that there was no real live or undecided issue, and Ms Howard cannot continue to present her views despite issue estoppel or res judicata. The Judge referred to Justice Courtney’s decision, in which she declined leave to appeal and said:
No matter how Mr Howard frames his arguments, the underlying complaint in this case and in all of the other proceedings involving Mrs Howard's claim is that the ACC should not have suspended her entitlements. … that issue has now been determined. Mr Howard does not seem to grasp that finality in litigation relates to the substantive complaint. Once a substantive issue has been raised and determined in litigation between the parties it cannot be raised again. Advancing it in the guise of some other form of proceeding or framed as another kind of complaint cannot disguise its true nature.
It is of serious concern that precious court resources continue to be taken up in advancing essentially the same argument in different forms. This litigation may justify an application under s 166 of the Senior Courts Act 2016, which is intended to restrain the unwarranted and vexatious use of the court process for cases that have no merit.
[20] The Judge similarly found that the application for leave to appeal Judge Spiller’s decision, was premised on relitigating the same underlying complaint, and was effectively an abuse of process.
[4] In her leave application to this Court, Ms Howard sought to appeal Judge Henare’s decision, advancing identical grounds to that advanced in her application before Judge Henare. I found that the appeal related to Judge Spiller’s substantive findings. I held that there was no basis to grant special leave to appeal from Judge Henare’s decision, as Ms Howard had not provided any fresh evidence or other new information to show that there was an issue of principle at stake that had a reasonable prospect of success, nor was there an extraordinary factor to grant special leave to appeal.
[5] I further noted that Ms Howard has “utilised extensive judicial resource to repeatedly revisit the issue of suspension” and “has engaged in what can only be seen as an abuse of process to advance yet another appeal.”3
Parties’ submissions
ACC
[6] Mr McBride, for ACC, seeks an order for costs on a category 2B basis plus disbursements. He makes this application, notwithstanding that ACC ordinarily adopts a conservative approach to seeking costs against a bona fide but misguided applicant, but says there are a number of factors supporting ACC’s application.
[7] The first is the settlement agreement in which Ms Howard agreed that the ex gratia payment was a full and final settlement and that she would not personally initiate or be involved in any further action. Second, this Court’s finding that Ms Howard’s appeal is an abuse of process. Lastly, that costs awards have been made against Ms Howard for a number of her many appeals.
Ms Howard
[8] Ms Howard opposes an award of costs. Among a number of concerns, she says the substantive proceeding was brought under s 162 of the Accident Compensation Act 2001 (ACC Act) and had a reasonable prospect of success. She submits that ACC also sought leave to appeal to the High Court on proposed questions of law to test
3 At [30] and [31].
findings against ACC and Ms Howard did not seek costs. She disputes that the substantive proceedings were merely another avenue to advance an appeal on the suspension issue. She submits that the purpose of the proceedings was to ensure that the law is applied correctly, which is in the public interest. Ms Howard says that as she is in receipt of superannuation, the costs sought by ACC will have a significant fiscal impact on her.
[9] In the alternative, she submits that the ACC’s costs calculation is too high, being double that sought by ACC for the application for leave to appeal hearing in the District Court.
[10] Lastly, Ms Howard makes reference to the issues that were the subject of the substantive proceedings and other prior proceedings. She claims that ACC remains in breach of its legal obligations, leaving her with no effective remedy. She also points to alleged errors in the previous decisions of Judge Spiller and Judge Henare.
Relevant law
[11] The overarching principle of costs determinations is that they are at the discretion of the Court.4 There are three key principles on the award of costs which are applicable here:
(a)The primary principle is that the unsuccessful party should pay costs: r 14.2(a) (“costs follow the event”).
(b)The rules aim to achieve predictability, consistency and expediency in the “determination” (fixing and payment) of costs: r 14.2(g).
(c)The rules contain rates and steps designed to deliver to the successful party approximately two-thirds of the daily rate considered reasonable once the proceeding has been placed in its appropriate category for complexity or significance (r 14.3) and, then, in the appropriate band for time (r 14.5).
4 High Court Rules 2016, r 14.1.
Analysis
Public interest
[12] Ms Howard submits that the costs should be reduced or the order refused as the purpose of the proceedings was to ensure that the law was applied correctly, which is in the public interest.
[13] Rule 14.7(e) provides that a court may refuse to make an order for costs or reduce the costs otherwise payable if the proceeding concerned a matter of public interest and the party opposing costs acted reasonably in the conduct of the proceeding. Taylor v District Court at North Shore provided a two-part test that reflects the rule and authorities:5
(a)the proceeding must concern a matter of genuine public interest, have merit and be of general importance beyond the interests of the particular unsuccessful litigant; and,
(b)the unsuccessful litigant must have acted reasonably in the conduct of the proceeding.
[14] I do not uphold Ms Howard’s submission for two reasons. First, the matter was not of genuine public interest as the proceedings were brought for Ms Howard’s personal gain6 and the matter did not have general importance beyond her interests. While it is important to ensure that the law is correctly applied, this is not a sufficient reason to reduce or refuse the costs order, as this is common to all decisions.
[15] Second, Ms Howard did not act reasonably in these proceedings. As I found in the leave judgment, Ms Howard has engaged in an abuse of process. Not only has she pursued a number of unsuccessful appeals, she has done so following her receipt of an ex gratia payment in full and final settlement of her claims. I consider it is inappropriate that a costs award should be reduced or refused in these circumstances.
5 Taylor v District Court at North Shore (No 2) HC Auckland CIV-2009-404-2350 at [9].
6 See Save Kapiti Inc v New Zealand Transport Agency [2013] NZHC 3314 at [19].
Impecunious party
[16] Ms Howard also appears to submit that costs should be reduced or refused as she is impecunious and the costs will have a significant effect on her.
[17] Unsuccessful self-represented litigants are liable to pay costs to a represented party in the usual way.7 The Court has discretion to reduce costs or refuse ordering costs under r 14.7(g). This rule has been invoked in circumstances where a party opposes costs on the basis of financial hardship. However, in Foni v Foliaki, the High Court emphasised that:8
(a)financial hardship is not an answer to a claim for a costs award;
(b)cost awards must be made at a meaningful level, even against an impecunious party, particularly where the case is poorly pleaded or is found to lack merit; and,
(c)there is a preference for evidence of limited financial means to be provided in the form verified by affidavit (unless established through evidence in the substantive proceeding).
[18] The Court further noted that use of the discretion, including in cases of financial hardship on the part of the unsuccessful litigant, should be reserved for exceptional cases.9
[19] This case is not exceptional. Ms Howard has attempted to appeal yet again. Her leave submissions lacked merit, and were the same as those dismissed in previous proceedings. And there is no affidavit attesting to Ms Howard’s financial position.
[20] Accordingly, an order for costs should not be reduced or refused on financial grounds.
7 David Bullock and Tim Mullins The Law of Costs in New Zealand (looseleaf ed, LexisNexis, Wellington, 2022) at [2.8].
8 Foni v Foliaki [2018] NZHC 3126 at [5]. See also Lincoln v Attorney-General [2024] NZHC 326 at [9].
9 At [11]. See also Lincoln v Attorney-General, above n 8, at [10].
Costs follow the event
[21] I am satisfied that there is no reason for me to depart from the usual approach to costs. Costs should follow the event and are awarded on a 2B basis.
[22] I therefore order that Ms Howard is to pay ACC’s costs and disbursements in the sum of $7,041, in accordance with the schedule to Counsel’s memorandum dated 11 July 2023.
Cull J
Solicitors:
McBride Davenport James, Wellington, for Respondent
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