Exit Distraction Free Reading Mode
In this recent matter his Honour considered whether, on the proper construction of the provisions of Pt 8, Div 2 Workers’ Compensation and Rehabilitation Regulation 2014, a plaintiff was entitled to recover counsel’s fees as part of his costs calculated in accordance with those provisions. The costs in issue were counsel’s fees after proceedings had issued. His Honour was of the view that the assessor had been correct in excluding counsel’s fees from the assessment of the plaintiff’s costs of and incidental to the claim and proceedings.
6 December 2022
Following the parties entering into a “Release and Discharge” in relation to a personal injury claim, they were unable to reach agreement as to costs  and the court appointed a costs assessor. The plaintiff challenged the assessment and sought a review of it under r 742 Uniform Civil Procedure Rules 1999. . In particular, the plaintiff queried the assessor’s determination that counsel’s fees are not a permissible outlay under Part 8, Division 2 of the Regulation, arguing that that was a legal error. .
Rule 742 states:
“(1) A party dissatisfied with a decision included in a costs assessor’s certificate of assessment may apply to the court to review the decision.
(6) Subject to subrule (5), on the review, the court may do any of the following—
(a) exercise all the powers of the costs assessor in relation to the assessment;
(b) set aside or vary the decision of the costs assessor;
(c) set aside or vary an order made under rule 740(1);
(d) refer any item to the costs assessor for reconsideration, with or without directions;
(e) make any other order or give any other direction the court considers appropriate.”
Were counsel’s fees an allowable outlay?
Since neither reg 135 nor reg 136 make provision for the recovery of counsel’s fees as part of the legal professional costs of the claim incurred after a proceeding has commenced, the issue here was whether there was scope to do so under reg 137 (apart from those specifically identified in regs 137(1)(a) to (i)). . The plaintiff submitted that the wording of reg 137 implies that it is intended to allow recovery of certain identified costs rather than to prohibit items which are omitted in regs 137(1)(a) to (i). Whilst his Honour accepted the premise of that argument, he did not agree that it established a basis within Pt 8, Div 2 of the Regulation which would enable a claimant to recover counsel’s fees. .
Rather, his Honour identified that the only indication of an entitlement to recover counsel’s fees which might be found in the text of reg 137 arises from its opening words: “In addition to legal costs …”. That is because a broad construction might allow “legal costs” to include counsel’s fees as well as solicitor’s fees. . However, that argument is problematic since:
- a plain reading of the relevant words in the context of the other provisions of Pt 8, Div 2 of the regulation lends support to the conclusion that the term has been used to refer to the legal professional costs recoverable as per regs 135 and 136. ; and
- it is standard practice to describe counsel’s fees as an “outlay” on an assessment of costs. .
Given the inconsistency in the various terms used to refer to a claimant’s costs in the applicable legislation, his Honour’s view was that the correct approach was that:
“… it should not be presumed that the term ‘legal costs’ has been used in reg 137(1) in a technical or legal sense to exclude counsel’s fees. Nevertheless, that conclusion does not displace the meaning of ‘legal costs’ on a plain reading of the opening words of reg 137(1) as explained in  above. Nor does such a conclusion, of itself, assist in establishing a basis within Part 8, Division 2 of the Regulation for a claimant’s entitlement to recover counsel’s fees on an assessment of costs.” .
The plaintiff argued that the assessor’s decision might essentially result in a worker who pursued a claim under Ch 5, Pt 12, Div 1 of the Act and Pt 8, Div 2 of the regulation being unable to recover counsel’s fees at all, which would be “absurd and manifestly unfair.” . His Honour did not accept that. Rather, he clarified that the operation of the relevant provisions avoids any such absurdity or unfairness, since a construction which does not permit a claimant to recover counsel’s fees under Part 8, Division 2 of the regulation would not have the effect of excluding counsel’s fees from the assessment of a plaintiff’s costs under an order of the court that those costs be paid on the indemnity basis under s 312 of the Act. .
In his Honour’s considered view, a construction of Pt 8, Div 2 of the regulation which does not enable a claimant to recover counsel’s fees would be compatible with the legislative objective of promoting the settlement of claims without proceedings needing to be filed in court. . He held that that was the proper construction. Accordingly, it was not the case that the assessor had erred by excluding counsel’s fees from the assessment. In reaching that conclusion he did however stress that he did not endorse the assessor’s statement to the effect that the provisions of Pt 8, Div 2 of the Regulation “override” the provisions of the UCPR. .
The plaintiff’s application pursuant to r 742 UCPR to review the assessment was dismissed.