FEDERAL COURT OF AUSTRALIA Military Rehabilitation & Compensation Commission v Perry [2007] FCA 1862 COSTS – appeal from Administrative Appeals Tribunal – respondent successful on basis of issue of construction first raised at hearing – applicant successful on issue of retrospectivity before the Tribunal – applicant should not pay respondent's costs on all issues– applicant to pay half of respondent's costs. Safety, Rehabilitation and Compensation Act 1988 (Cth) ss 8, 8(6), 8(9B) Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2001 (Cth) Military Rehabilitation & Compensation Commission v Perry [2007] FCA 1586 considered MILITARY REHABILITATION AND COMPENSATION COMMISSION v DAVID PERRY NSD 546 OF 2007 BENNETT J 29 NOVEMBER 2007 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 546 OF 2007 ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY PROFESSOR I A SHEARER, SENIOR MEMBER BETWEEN: MILITARY REHABILITATION AND COMPENSATION COMMISSION Applicant AND: DAVID PERRY Respondent JUDGE: BENNETT J DATE OF ORDER: 29 NOVEMBER 2007 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The applicant is to pay one half of the respondent's costs of the appeal. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 546 OF 2007 ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY PROFESSOR I A SHEARER, SENIOR MEMBER BETWEEN: MILITARY REHABILITATION AND COMPENSATION COMMISSION Applicant AND: DAVID PERRY Respondent JUDGE: BENNETT J DATE: 29 NOVEMBER 2007 PLACE: SYDNEY REASONS FOR JUDGMENT INTRODUCTION 1 This matter was argued in the Administrative Appeals Tribunal ('the Tribunal') on the question of the retrospective operation of s 8(9B) of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ('the SRC Act'). Section 8(9B) was introduced into the Act by the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2001 (Cth) ('the Amending Act') which commenced after the respondent ('Mr Perry') was injured. The Tribunal decision in favour of Mr Perry was that s 8(9B) did not have retrospective operation and was therefore not applicable to an employee injured prior to the commencement of the Amending Act ('the retrospectivity issue'). The Tribunal decided the application before it on the basis of the issues presented by the parties. 2 The appeal to this Court was initially limited to the retrospectivity issue and the notice of appeal and written and oral submissions centred on it. It was during the initial hearing of the appeal that the effect of the reference in s 8(9B) to s 8(6) of the SRC Act and the construction of s 8 ('the construction issue') became a subject of submissions and consideration by the parties. 3 The matter was adjourned to enable the parties to address the construction issue. Further written submissions were filed and, when the hearing of the appeal resumed, the parties addressed on both the construction issue and the retrospectivity issue. 4 The reasons for judgment addressed both issues (Military Rehabilitation & Compensation Commission v Perry [2007] FCA 1586). Theapplicant ('the Commission') was successful on the retrospectivity issue but unsuccessful on the construction issue (at [59]-[60]). It was therefore unsuccessful in its challenge to the decision under review in the Tribunal. Accordingly, the application was dismissed (at [61]). SUBMISSIONS ON COSTS 5 The parties were given the opportunity to provide submissions on costs. The Commission submits that there should be no order as to the costs of the application or, alternatively, that the Commission pay no more than half of what would otherwise have been Mr Perry's party-party costs. It also submits that the Tribunal's decision, in so far as it relates to costs, should be set aside. The Commission submits that the argument put at the hearing on behalf of Mr Perry was misconceived and that the Tribunal would not have exercised its discretion to award him costs. 6 Mr Perry submits that the Commission should pay all of his costs of the proceedings. Mr Perry recognises that the Court has a wide discretion to award costs but submits that there are no special circumstances to preclude costs following the event. In particular, Mr Perry says that there should be no apportionment by reference to the issues in the proceedings. In any event, he submits, the construction of s 8(9B) of the SRC Act was not separate and distinct from the issue on which he succeeded. Mr Perry says that the consideration by the Court of the retrospectivity issue, the issue before the Tribunal, was not necessary to the decision concerning his entitlements, determined by s 8(6) and its relationship to s 8(9B) of the SRC Act. Mr Perry also submits that his approach before the Tribunal was not unreasonable, given the history of the matter and the basis of the decisions taken by the delegates of the Commission. CONSIDERATION 7 The matter came before the Court on the same basis as before the Tribunal, that is, on the retrospectivity issue. The initial submissions focused on the question of retrospectivity and did not address the relevance of the reference to s 8(6) in s 8(9B) of the SRC Act or highlight the relevance of s 8(6) in determining Mr Perry's entitlements after he ceased to be an employee of the Commonwealth. It was necessary to adjourn the proceedings to enable both parties to reformulate their submissions. 8 The Commission's appeal from the decision of the Tribunal was reasonably commenced in relation to the retrospectivity issue. The Commission has succeeded on that issue, although it was not determinative of the application as it was finally argued. The Commission did, however, maintain its appeal after the construction issue was ventilated. Mr Perry ultimately succeeded, in that the decision of the Tribunal in his favour was affirmed but for a reason not considered by or argued before the Tribunal. 9 As the decision of the Tribunal was affirmed, I will not disturb the costs order there made. However, the Commission should not have to pay Mr Perry's costs on all issues. If the matter had proceeded only on the retrospectivity issue, the Commission would have been successful and the order for costs made by the Tribunal set aside. The retrospectivity issue was the subject of the first round of both written and oral submissions and the first day of the hearing. If Mr Perry had raised the construction issue at the outset, substantial costs would not have been incurred. 10 In my view, the appropriate order is that the Commission pay one half of Mr Perry's costs. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett. Associate: Dated: 29 November 2007 Counsel for the Applicant: Mr G Johnson Solicitor for the Applicant: Australian Government Solicitor Counsel for the Respondent: Mr P Hanks QC Solicitor for the Respondent: KCI Lawyers Date of submissions: 23 November 2007 Date of Judgment: 29 November 2007