Supreme Court New South Wales Medium Neutral Citation: Hitchen v Strategic Formwork Pty, Hitchen v RTS Holdings Pty Ltd (No 2) [2017] NSWSC 672 Hearing dates: By way of written submissions Date of orders: 30 May 2017 Decision date: 30 May 2017 Jurisdiction: Common Law Before: Harrison AsJ Decision: The Court orders that: (1) Strategic Formwork Pty Ltd is to pay the plaintiff's costs on an ordinary basis. (2) The plaintiff and RTS Holdings Pty Ltd are to pay their/its own costs. Catchwords: COSTS – costs of the cross claim under s 151Z Workers Compensation Act Legislation Cited: Civil Procedure Act 2005 (NSW) s 98 Workers Compensation Act 1987 (NSW) s 151 Workers Compensation Regulation 2010 r 106 Workers Compensation Regulation 2016 r 96 Uniform Civil Procedure Rules 2005 (NSW) rr 42.1, 42.2 Cases Cited: Glynn v Challenge Recruitment Australia Pty Ltd [2006] NSWCA 203 Hitchen v Strategic Formwork Pty; Hitchen v RTS Holdings Pty Ltd [2017] NSWSC 75. Category: Costs Parties: 2014/129961 Daniel Hitchen (Plaintiff) Strategic Formwork Pty Ltd (Defendant) 2015/267220 Daniel Hitchen (Plaintiff) RTS Holdings Pty Ltd (Defendant) Representation: Counsel: 2014/129961 K Andrews (Plaintiff) R Cavanagh SC with J Callaway (Defendant) 2015/267220 K Andrews (Plaintiff) G Parker SC (Defendant) Solicitors: 2014/129961 Law Advice Compensation Lawyers (Plaintiff) Biggers & Paisley (Defendant) 2015/267220 Law Advice Compensation Lawyers (Plaintiff) Moray & Agnew (Defendant) Solicitors: 2014/129961 Law Advice Compensation Lawyers (Plaintiff) Biggers & Paisley (Defendant) 2015/267220 Law Advice Compensation Lawyers (Plaintiff) Moray & Agnew (Defendant) File Number(s): 2014/129961; 2015/267220 Publication restriction: Nil Judgment 1. HER HONOUR: On 17 February 2017, I handed down judgment: Hitchen v Strategic Formwork Pty; Hitchen v RTS Holdings Pty Ltd [2017] NSWSC 75. By consent, the parties requested that the Court refrain from making any costs orders until they had an opportunity to be heard on this issue. 2. On 17 February 2017, I made orders for the filing and serving of written submissions by the parties. On 24 February 2017, I made an order that Strategic Formwork Pty Ltd and RTS Holdings Pty Ltd were to file and serve written submissions on the costs of the cross claim under s 151Z(2) of the Workers Compensation Act 1987 (NSW) by 3 March 2017. These submissions have now been received. 3. This Court has apportioned the culpability of RTS Holdings at 40% and Strategic Formwork at 60%. RTS Holdings and Strategic Formwork filed cross claims against each other. By consent, orders are to be made today that the cross claims are to be dismissed and each party is to pay its own costs. Costs generally 1. Section 98 of the Civil Procedure Act 2005 (NSW) relevantly reads: "98 Courts powers as to costs (1) Subject to rules of court and to this or any other Act: (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and …" 1. Rules 42.1 and 42.2 of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") read: "42.1 General rule that costs follow the event Subject to this Part, if the court makes any order as to costs, the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs. 42.2 General rule as to assessment of costs Unless the court orders otherwise or these rules otherwise provide, costs payable to a person under an order of the court or these rules are to be assessed on the ordinary basis." 1. Section 151S and 151T of the Workers Compensation Act 1987 (NSW) read: "151S Court to apportion damages etc (1) If a judgment is obtained for payment of damages to which this Division applies as well as for other damages, the court is required, as part of the judgment, to declare what portion of the sum awarded by the judgment is damages to which this Division applies. (2) In any such case the court is required to apportion any costs awarded. 151T Costs (1) Subject to the rules of court, if a court awards costs to a plaintiff by reference to the amount recovered by the plaintiff, that amount is to be taken to be the amount recovered as qualified, or after making any deduction or reduction, in accordance with this Division." 1. Regulation 96 of the Workers Compensation Regulation 2016 which was Regulation 106 of the Workers Compensation Regulation 2010 provides that "Except as provided by this subdivision, the parties to court proceedings for work injury damages are to bear their own costs." The plaintiff and RTS Holdings 1. The plaintiff submitted that so far as RTS Holdings is concerned, each party is to pay its/and or their own costs. 2. RTS Holdings submitted that it is not liable to pay any costs of the plaintiff pursuant to Regulation 106 of the Workers Compensation Regulation 2010. Mediation did not occur and therefore RTS Holdings was deemed to have made an offer of nil dollars. According to RTS Holdings, the plaintiff did not make an offer and therefore is deemed to have made an offer of settlement in accordance with his particulars which far exceeded the present verdict for the plaintiff against RTS Holdings. 3. The plaintiff accepts that due to fact of the manner in which the work injury damages mediation took place will limit the parties to an order that each party in relation to the plaintiff and RTS Holdings will be ordered to pay its and/or their own costs pursuant to Regulation 106 of the Workers Compensation Regulations 2010. Hence, I make an order that between the plaintiff and RTS Holdings, each party pay his/its own costs. The plaintiff and Strategic Formwork 1. In relation to the proceedings between the plaintiff and Strategic Formwork, the plaintiff submitted that s 151S of the Workers Compensation Act 1987 (NSW) is not applicable. The plaintiff noted that RTS Holdings admitted a breach of duty of care on the first day of the hearing but the cross claims between Strategic Formwork and RTS Holdings were still on foot. The plaintiff submitted that so far as Strategic Formwork is concerned the appropriate order is that costs should follow the event and Strategic Formwork should pay the plaintiff's costs as agreed or assed pursuant to UCPR 42.1. 2. The plaintiff says that Strategic Formwork pursued liability but made no allegation of contributory negligence against the plaintiff. The plaintiff submitted that the hearing was extended in relation to the question of liability due to the actions of Strategic Formwork and/or RTS Holdings. According to the plaintiff, if it had not been for the liability issues remaining in dispute, the hearing of the proceedings would have been substantially reduced and after the conclaves of experts had taken place, no real dispute as to the extent of the plaintiff's injuries nor the future impact of the injuries upon the plaintiff would have been in issue and the hearing substantially reduced. Further, the plaintiff submitted that evidentiary statements had been served and Strategic Formwork required witnesses to be available for cross examination. However, during the course of the hearing due to technical or other reasons Strategic Formwork resiled from that position. 3. Strategic Formwork submitted that the admission of liability by RTS Holdings did not shorten the matter and did nothing to reduce the question on either liability or quantum and in these circumstances costs should follow the event. Hence, Strategic should be ordered to pay 60% of the plaintiff's costs. Further, Strategic Formwork submitted that pursuant to ss 151S and 151T of the Workers Compensation Act 1987 (NSW) the Court is required to limit the costs order against it to 60%. Conclusion 1. Section 151S of the Workers Compensation Act 1987 (NSW) specifically refers to the "payment of damages to which this Division applies." Section 151S falls within Division 3 which is entitled "Common law remedies". Division 3, Part 5 is headed "Modified common law damages". It applies to modified common law damages or what is commonly referred to as work injury damages. That was the cause of action between the plaintiff and RTS Holdings. 2. The cause of action against Strategic Formwork is brought pursuant to the Civil Liability Act, but modified only by s 151Z in relation to the quantification of Strategic Formwork's liability. The intention of s 151S is to ensure that an apportionment takes place between the defendants but does not impact upon the plaintiff's entitlement to a judgment for the full amount as against each defendant: see Glynn v Challenge Recruitment Australia Pty Ltd [2006] NSWCA 203. 3. In my view, the appropriate order for costs should be that costs are to follow the event. Strategic Formwork is to pay the plaintiff's costs on an ordinary basis. The Court orders that: (1) Strategic Formwork Pty Ltd is to pay the plaintiff's costs on an ordinary basis. (2) The plaintiff and RTS Holdings Pty Ltd are to pay their/its own costs. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 May 2017