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Cope v Workers' Compensation Regulator[2019] QIRC 166

Cope v Workers' Compensation Regulator[2019] QIRC 166

QUEENSLAND INDUSTRIAL RELATIONS COMMISSION

CITATION:

Cope v Workers' Compensation Regulator [2019] QIRC 166

PARTIES:

Cope, Michael

Appellant

v

Workers' Compensation Regulator

Respondent

CASE NO:

WC/2018/154

PROCEEDING:

Appeal against decision of the Workers' Compensation Regulator

DELIVERED ON:

5 November 2019

HEARING DATE:

28 - 30 August 2019

23 September 2019 (Appellant submissions)

14 October 2019 (Respondent submissions)

22 October 2019 (Appellant submissions)

MEMBER:

Pidgeon IC

HEARD AT:

Hearing held in Brisbane

Issue of costs dealt with on the papers

ORDERS:

  1. Each Party bear its own costs.

CATCHWORDS:

WORKERS' COMPENSATION – APPEAL AGAINST DECISION – where the substantive matter conceded by Regulator after hearing – issue of costs – Each party bear own costs.

LEGISLATION:

Workers' Compensation and Rehabilitation Act 2003

Workers' Compensation and Rehabilitation Regulation 2014

CASES:

Bon Appetit Family Restaurant Ltd v Synnerdahl [2002] NSWCA 368

Donald Campbell & Co v Pollack [1927] AC 732

Groos v WorkCover Queensland (2000) QID 52

MacDougall v Curlevski (1996) 40 NSWLR 430

Queensland Bulk Water Supply Authority Trading as Seqwater v Workers' Compensation Regulator [2019] QIRC 054

State of Queensland (Department of Justice and Attorney General, Queensland Corrective Services) v Timmins (No.2) [2018] QIRC 117

APPEARANCES:

At hearing:

Mr M Horvath instructed by Turner Freeman Lawyers for the Appellant.

Submissions on costs: Turner Freeman Lawyers.

Ms D Callaghan instructed directly by the Workers' Compensation Regulator.

Reasons for Decision

Matter to be determined

  1. [1]
    Michael Cope (Appellant) lodged an appeal against a decision of the Workers' Compensation Regulator on 31 August 2018.
  2. [2]
    As per a Directions Order issued by the Industrial Registrar on 28 February 2019, the parties were to advise the Industrial Registry whether a section 552A conference would be required.
  3. [3]
    On 29 April 2019, the Appellant's representative advised the Industrial Registry that the Appellant did not require a section 552A conference and requested hearing dates be allocated for the matter.
  4. [4]
    The matter proceeded to hearing and was conducted over three days on 28, 29 and 30 August 2019.
  5. [5]
    Following the hearing, the Regulator informed the Commission that the matter was being conceded.
  6. [6]
    The only matter outstanding between the parties was the issue of costs.  Following a directions order of 16 September 2019, the Appellant filed a schedule of costs and both parties filed submissions addressing the matter of costs.
  7. [7]
    The Appellant seeks an order that the Respondent pay his costs and in accordance with a directions order from the Commission dated 16 September, provided a schedule of costs.
  8. [8]
    The Respondent seeks an Order the that the parties bear their own costs or in the alternative, that if the Commission makes a costs order in favour of the Appellant, that the Order complies with the Workers' Compensation and Rehabilitation Regulation 2014.

Relevant Legislation

  1. [9]
    Section 558(3) of the Workers' Compensation and Rehabilitation Act 2003 (the WCRA) states: "Costs of the hearing are in the appeal body's discretion, except to the extent provided under a regulation."
  2. [10]
    The relevant regulation, being reg 132 of the Workers' Compensation and Rehabilitation Regulation 2014 states:

132 COSTS – PROCEEDING BEFORE INDUSTRIAL MAGISTRATE OR INDUSTRIAL COMMISSION

  1. (1)
    A decision to award costs of a proceeding heard by an industrial magistrate or the industrial commission is at the discretion of the magistrate or commission.
  2. (2)
    If the magistrate or commission awards costs –
  1. (a)
    costs in relation to counsel's or solicitor's fees are as under the Uniform Civil Procedures Rules 1999, schedule 2, part 2, scale C; and
  2. (b)
    costs in relation to witnesses' fees and expenses are as under the Uniform Civil Procedure (Fees) Regulation 2019, part 3; and
  3. (c)
    costs in relation to bailiff's fees are as under the Uniform Civil Procedure (Fees) Regulation 2019, schedule 2, part 2.
  1. (3)
    The magistrate or commission may allow costs up to 1.5 times the amounts provided for under subsection (2)(a), in total or in relation to any item, if the magistrate or commission is satisfied the amounts are inadequate having regard to –
  1. (a)
    the work involved; or
  1. (b)
    the importance, difficulty or complexity of the matter to which the procedure relates.

Submissions

Respondent

  1. [11]
    The Respondent points to the principles in relation to the exercise of discretion of a court in making an award for costs as set out in a decision of O'Connor VP.[1]
  2. [12]
    The Respondent says that a court may depart from a general principle that costs follow the event if it is satisfied some Order should be made and further that a court may refrain from ordering costs in favour of a successful party.
  3. [13]
    The Respondent says that in other cases where the successful party's misconduct lengthened the proceedings unnecessarily or caused unnecessary issues to be canvassed or otherwise increased the costs of litigation, a court may be persuaded to award costs against the successful party.[2]
  4. [14]
    The Respondent cites the case of Donald Campbell & Co v Pollack,[3] the House of Lords held that a judge without a jury

has the absolute and unfettered discretion to award or not to award costs to him (the successful party). This discretion must be exercised judicially, and the judge ought not to exercise his discretion against a successful party on grounds wholly unconnected with the cause of action.

and further

 but when a judge intending to exercise his discretion, has acted on facts connected with or leading up to the litigation, the Court of Appeal is prohibited by statute from entertaining an appeal from his decision. (Emphasis added by Respondent).

  1. [15]
    The Respondent does not submit that the Appellant made a deliberate decision not to disclose Dr Estensen's report or opinion on causation until the morning of the hearing of his evidence.  Similarly the Respondent does not seek a costs in its favour but an Order that both parties bear their own costs. 
  2. [16]
    The Respondent submits that the following facts connected with or leading up to the litigation are relevant to the Commission's consideration in the exercise of discretion (footnotes omitted):
    1. The Regulator's decision was made on 1 August 2018, on the basis of the medical records at hand and the reports of the treating psychologist, Ms Sharon Atkins and treating psychiatrist, Dr Johannes Scheepers. There had been no report of Dr Axel Estensen provided to the regulator.
    2. Dr Estensen provided a report on behalf of the appellant dated 8 August 2018, which was disclosed to the respondent. This report did not address the question of causation of the appellant's psychiatric condition – that is, that the accepted left shoulder injury was the major significant contributing factor to the psychiatric condition.
    3. The appellant lodged a notice of appeal on 31 August 2018, including a ground that the respondent had denied the appellant procedural fairness in not providing a further extension to obtain and consider Dr Estensen's report.
    4. The appellant filed a statement of facts and contentions on 13 November 2018, which included no reference to Dr Estensen's report or basis for its contentions that the psychiatric injury fell within the definition required under section 32 of the WCRA.
    5. The respondent filed a detailed statement of facts and contentions on 14 December 2018, referring to the appellant's multiple "complex" physical and social issues referred to in the medical records and reports, the lack of evidence in relation to causation and in particular, the deficiency in the (disclosed) report of Dr Estensen.
    6. Despite serving a list of witnesses and outlines of evidence on 18 March 2018 and an updated list of documents on 30 July 2019, the additional report of Dr Estensen was not disclosed.
    7. The appellant declined the opportunity to hold a section 552 conference.
    8. In accordance with directions from the Commission, the parties attempted to collate an agreed trial bundle of documents.
    9. The appellant provided its own bundle of trial documents to the Commission on 21 August 2019, with a copy forwarded to the respondent. This bundle did not include the additional report of Dr Estensen.
    10. On 26 August 2019, the respondent agreed to the appellant's offer to withdraw its other appeal, which was also set down to be heard on 29 August 2019, in relation to termination of the claim for the physical injury, on the basis that the parties bear their own costs. This was despite the respondent having borne the costs of preparation of this appeal (at the least, the same or similar items as listed at items 2, 3, 8 and 9 of the appellant's schedule);
    11. The three day hearing commenced on 28 August 2019.
    12. On the morning of 29 August 2019, at around 8.30am, in circumstances in which Dr Estensen was scheduled to give evidence at 10am, the additional report of Dr Estensen was disclosed to the respondent.
    13. The additional report of Dr Estensen, also dated 8 August 2018, included an additional paragraph, in answer to the specific question, that the only identified causal factor for the appellant's psychiatric injury was the work related orthopaedic (left shoulder) injury.
    14. The respondent objected to the report being tendered, which it was not, but also to oral expert evidence, not previously disclosed and material to the ultimate issue to be determined by the Commission, to be called at this late stage.
    15. When the respondent became aware of Dr Estensen's opinion, steps were taken to commence the process for conceding the appeal.  The decision was made and transmitted to the appellant prior to the parties and Commission expending the costs of drafting and considering submissions.
    16. To pre-empt any suggestion by the appellant that the respondent should have surmised Dr Estensens's opinion from the first report, the respondent says:
  1. (i)
    as confirmed by Dr Estensen in cross-examination, the PIRS rating has nothing to do with causation;
  2. (ii)
    as confirmed with Dr Estensen in cross-examination, Axis III in DSM IV refers to 'information about any medical conditions that were present which might impact the patient's mental disorder or its management.' It is not an opinion on causation of the mental disorder.
  3. (iii)
    as confirmed with Dr Estensen in cross-examination and as evident in the material reviewed listed in his report, he did not have access to all of the appellant's medical information, in particular in relation to the appellant's ankylosing spondylosis;
  4. (iv)
    the onus of proof in the appeal always rested with the appellant.
  1. [17]
    The Respondent says that in the interests of justice, Dr Estensen's opinion must be considered by the Commission however an equal consideration is that withholding crucial evidence, inadvertently or otherwise, is relevant to consideration of costs. Furthermore they state "the purposes of the Commission and its Rules, as well as the WorkCover processes themselves...have been frustrated".[4]
  2. [18]
    The Respondent says that on examination of the facts and circumstances above, the Appellant has not been caused to incur costs of litigation by the Respondent but by his own failure to disclose a report directly pertaining to the ultimate issue prior to the second day of the hearing. On that basis the Respondent requests that the Commission make an order that each party bear their own costs in the appeal.

Appellant

  1. [19]
    By way of background, the Appellant outlined the events which led to the claim for a psychiatric/psychological condition beginning with the claim made on or around 6 March 2017 for the initial physical injury to the Appellant's shoulder through to the review lodged with the Respondent on or about 21 May 2018 challenging the decision of WorkCover declining the claimed psychiatric/psychological condition.
  2. [20]
    The Appellant submits that he attended on Dr Axel Estensen on 29 May 2018 for the purpose of providing the Respondent with specialist medical material for the purposes of the review. 
  3. [21]
    The Appellant sought the provision of natural justice from the Respondent to the extent that time should be afforded by the Respondent to the Appellant to provide additional specialist medical evidence which was directly relevant to issues in dispute. This request was refused by the Respondent by reason that:
  1. (a)
    The Respondent was of the opinion that natural justice was not grounds to provide any extension of time for the provision of a specialist report which dealt with the issues in dispute;
  2. (b)
    The Respondent was of the opinion that the opinion of Dr Estensen being a medical specialist is 'entirely speculative'.[5]
  1. [22]
    The Appellant states that in failing to afford the Appellant natural justice the Respondent fell into further error by reason that:
  1. The Respondent incorrectly identified Dr Johannes Scheepers as being the Appellant's treating psychiatrist [who diagnosed minor depressive illness].
  2. The Respondent did not consider the opinion of the Appellant's actual treating psychiatrist Dr Chinna Samy [who diagnosed adjustment disorder – multiple loss issues].
  1. [23]
    The Appellant submits that at that stage, the evidence clearly met the threshold required by the Industrial Court decision of Groos v WorkCover Queensland[6] when determining the causal connection between employment and the psychiatric/psychological injury and therefore the Respondent misapplied the law and the appeal should never have been required.
  2. [24]
    The Appellant says that the Respondent called only one witness, a rheumatologist, who also provided evidence supporting the Appellant's case. That witness agreed that the major significant contributing factor in causing the psychiatric symptoms was the accepted work-related shoulder injury.
  3. [25]
    The Appellant says that the Respondent "should not be rewarded by avoiding a costs order just by conceding after the evidence was concluded but before a judgement (sic) is delivered".[7]
  4. [26]
    The Appellant submits that the Respondent's position that the second report of Dr Estensen and his oral evidence was the ultimate catalyst for them conceding the appeal is wrong for the following reasons:
  • The second report was never tendered.
  • The existence of the second report was properly brought to the Commission's attention because of its late discovery but it was never relied upon.
  • The appellant never sought to tender the report and it did not go into evidence.
  • The Commission did not receive or read the second report.
  • Its disclosure is irrelevant to the question of costs.
  • In terms of the doctor's oral evidence the respondent had agreed to a trial plan which allowed for extensive examination of Dr Estensen over 1 hour.
  • If the respondent's position was correct then Dr Estensen was not even required to be called to give evidence and they ought to have admitted his first report by consent and then submitted that his evidence did not reach the required threshold. They did not do that.
  • They did not do that because they knew that his report did contain an opinion about causation and that it was going to be supplemented by oral evidence.
  1. [27]
    The Appellant says that further supporting the application for costs is an offer made prior to the hearing that the Respondent should concede with no order as to costs.
  2. [28]
    The Appellant points to the decision of Swan DP in State of Queensland (Department of Justice and Attorney General, Queensland Corrective Services) v Timmins (No.2) [2018] QIRC 117 ("Timmins") where it was held at [31]:
  1. (a)
    That the Respondent's refusal to accept the offer of settlement made by the Applicant, when all the circumstances of this case were known, was unreasonable and caused the Applicant to incur considerable costs.
  1. [29]
    With reference to Timmins, the Appellant submits that the Respondent's refusal to accept the Appellant's offer was unreasonable and the Appellant should be awarded costs as the Appellant has incurred considerable costs in pursuing the matter.
  2. [30]
    The Appellant, like the Respondent, also refers to the opinion of McHugh J in Latoudis v Casey[8] extracted in Queensland Bulk Water Supply Authority Trading as Seqwater v Workers' Compensation Regulator[9] ("Seqwater") that the order of costs is compensatory in its function.
  3. [31]
    The Appellant submits that costs should be awarded as per their Schedule of Costs.

Consideration

  1. [32]
    The general principle in a matter of this type is that costs follow the event.
  2. [33]
    I note that O'Connor VP's reference in Seqwater to the observation of Martin J in Blackwood v Egan[10] regarding the exercise of discretion in awarding costs was raised by both the Appellant and Respondent.  In that decision, his Honour referred to the High Court case of Latoudis v Casey[11] as follows:

In that case Mason CJ and Toohey and McHugh JJ discussed the nature of an award of costs.  At 543 Mason CJ said:

If one thing is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of the unsuccessful party.  They are compensatory in the sense that they are awarded to indemnify the successful party against he expense to which he or she has been put by reason of the legal proceedings.

He went on to say:

 Once the principle is established that costs are generally awarded by way of indemnity to a successful defendant, the making of an order for costs against a prosecutor is no more a mark of disapproval of the prosecution than the dismissal of the proceedings.

McHugh J said at 567:

 The rationale of the order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred.  The order is not made to punish the unsuccessful party.  Its function is compensatory.

  1. [34]
    With regard to the opportunity offered by the Appellant by the Respondent to resolve the appeal and pay no costs, I observe that at the time the offer was made and refused by the Respondent, all the circumstances of the case were not known. There had not at that point been an opportunity to hear from witnesses and undertake cross examination. Certainly, the existence of the second report was not known.
  2. [35]
    In any case the Appellant's suggestion that the decision of Swan DP in Timmins is relevant to this matter is misconceived. The consideration of costs in that application for reinstatement matter was in relation to s 545 of the Industrial Relations Act 2016. In the matter of Timmins, the Applicant seeking reinstatement accepted that he had refused to comply with orders in his workplace. Swan DP found that his claims were motivated towards seeking retaliation.  Her Honour also determined that in this case, the application for reinstatement in all aspects of the claim had extremely limited prospects of success and that the application was without merit and was made "without reasonable cause".
  3. [36]
    While I have considered the submissions of the Appellant regarding their perception of the strength of their evidence and the merits of each parties' arguments, it is not my intention to determine what the outcome of the matter may have been had the Respondent not made the decision to concede. 
  4. [37]
    It is the evidence of the Respondent that the decision to concede the matter occurred only after the existence and content of the second report became known.
  5. [38]
    In the circumstances, the second report, which was produced at the Appellant's request, had been in existence from the same time as the first report and was not made available through the disclosure process, either by error or otherwise.
  6. [39]
    I accept the argument of the Respondent that the Appellant has not been caused to incur costs by the Regulator but by their own failure to disclose a document which, once its existence was known, led the Regulator to concede the appeal.
  1. [40]
    Further, I do not accept the submission of the Appellant that the Respondent's refusal of an offer to settle without costs being awarded prior to the commencement of the trial was unreasonable.
  2. [41]
    Each party should bear their own costs in this matter.
  3. [42]
    I so order.

Footnotes

[1] Queensland Bulk Water Supply Authority Trading as Seqwater v Workers' Compensation Regulator [2019] QIRC 054.

[2] MacDougall v Curlevski (1996) 40 NSWLR 430; Bon Appetit Family Restaurant Ltd v Synnerdahl [2002] NSWCA 368.

[3] [1927] AC 732.

[4] Respondent submissions dated 11 October 2019 at [13].

[5] Affidavit of Mr Adam Norman Tayler dated 24 October 2019.

[6] (2000) QID 52.

[7] Appellant submissions filed 25 October 2019 at [19].

[8] (1990) 170 CLR 534.

[9] [2019] QIRC 054.

[10] [2014] ICQ 020.

[11] (1990) 170 CLR 534.

Close

Editorial Notes

  • Published Case Name:

    Michael Cope v Workers' Compensation Regulator

  • Shortened Case Name:

    Cope v Workers' Compensation Regulator

  • MNC:

    [2019] QIRC 166

  • Court:

    QIRC

  • Judge(s):

    Pidgeon IC

  • Date:

    05 Nov 2019

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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