Paskins v Hail Creek Coal Pty Ltd & Anor (No 2)

This recent decision includes some interesting observations regarding costs. The plaintiff had pursued claims against the first and second defendant, succeeding against both. However, the plaintiff could not recover its costs against the first defendant, as the mandatory final offer was less than the eventual award. The plaintiff sought an order that the second defendant pay its costs as against the first defendant. The court accepted, that it had been reasonable to pursue both defendants, and that there was no reason why the second defendant should not be required to bear the increased costs burden.

McMeekin J

29 September 2017

In this case, amongst other matters, his Honour considered whether a costs order made in favour of the plaintiff against the second defendant ought to be increased to include the costs of pursuing the first defendant following its success at first instance in suing for injuries sustained in the course of his employment with first defendant. That claim arose from an industrial accident at the Hail Creek coal mine. The second defendant, a labour hire company, unsuccessfully sought to argue that its employee’s employment had been transferred to the first defendant, the mine operator, given the operation of an indemnity clause in its contractual agreement. Judgment was awarded for the plaintiff against the first defendant for $709,408.26; and against the second in the sum of $966,991.38.

The relevant issue was whether the plaintiff was able to circumvent the effect of the Workers’ Compensation and Rehabilitation Act 2003 under which it was unable to obtain an order for costs against the first defendant since his mandatory final offer was less than the eventual award. The plaintiff sought an order that the second defendant pay not only the costs incurred in its pursuit, but also the costs incurred in pursuing the first defendant, given the outcome of the matter (where it had succeeded against both). [9].

The plaintiff’s core argument was that costs are in the discretion of the court (see s 15 Civil Proceedings Act 2011, r 681 Uniform Civil Procedure Rules 1999, (UCPR)) and that it was reasonable for it to take the course of pursuing both defendants. [10]. The plaintiff also stressed that had it pursued the second defendant alone, that defendant could not have pursued the first defendant for contribution under the Law Reform Act 1995 unless the plaintiff had first complied with the pre-litigation procedures under the Workers’ Compensation and Rehabilitation Act 2003: see Bonser v Melnacis [2002] 1 Qd R 1. [11].

The Court accepted that the plaintiff had acted reasonably. [11].  The question was “whether it is just, that the plaintiff, who was successful against both defendants, obtain an indemnity, to the extent that an order for costs on the standard basis can do so, against the expense to which he has been put by reason of the second defendant’s unsuccessful stance, that led to the plaintiff incurring this increased costs burden?” [19]. Referring to the objects of the Workers’ Compensation and Rehabilitation Act 2003 in ss 5(2), (4) and (5), none of which were offended by making the order that the plaintiff sought, [16]–[17], his Honour was of the view that there was no reason why in fairness, the second defendant not be required to bear the increased costs burden itself. [19].

A de Jersey