LOUREY -v- WA COUNTRY HEALTH SERVICE [2025] WADC 19

Catchwords:
Workers compensation – Appeal – Costs orders against employee’s representatives – Procedural fairness – Costs ‘unreasonably incurred by representative’ – Costs incurred ‘without reasonable cause’

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JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL
LOCATION : PERTH
CITATION : LOUREY -v- WA COUNTRY HEALTH SERVICE [2025] WADC 19
CORAM : CORMANN DCJ
HEARD : 4 FEBRUARY 2025
DELIVERED : 9 APRIL 2025
FILE NO/S : APP 36 of 2024
BETWEEN : MICHAEL JOSEPH LOUREY
First Appellant
TRISTA LEE SAVILLE
Second Appellant
AND
WA COUNTRY HEALTH SERVICE
Respondent
ON APPEAL FROM:
Jurisdiction : WORKERS COMPENSATION ARBITRATION SERVICE
Coram : ARBITRATOR FLETCHER
File Number : A123181 & A123182
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Catchwords:
Workers compensation – Appeal – Costs orders against employee’s representatives – Procedural fairness – Costs ‘unreasonably incurred by representative’ – Costs incurred ‘without reasonable cause’
Legislation:
Workers’ Compensation and Injury Management Act 1981 (WA), s 188, s 247, s 265(1)(c)
Workers Compensation and Injury Management Act 2023 (WA), s 391, s 542, s 546
Result:
Leave to appeal in respect of ground 1 is refused
Leave to appeal in respect of ground 2 is granted
The appeal is otherwise dismissed
Representation:
Counsel:
First Appellant
:
Mr P V Lansell
Second Appellant
:
In person
Respondent
:
Mr L E M Bayly
Solicitors:
First Appellant
:
Lansell Legal
Second Appellant
:
Not applicable
Respondent
:
HWL Ebsworth Lawyers
Case(s) referred to in decision(s):
Apache Northwest Pty Ltd v Agostini [No 2] [2009] WASCA 231
Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321
BHP Billiton Iron Ore Pty Ltd v Brady [2008] WASCA 250
Cameron v Cole [1944] HCA 5; (1994) 68 CLR 571
Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576
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Cullen v Woodside Energy Ltd [2021] WADC 56
Davie v Manuel [2024] WASCA 21
Defendi v Szigligeti [2019] WASCA 115
Frigger v Frigger [2023] WASCA 103
Johnson v Denwest Nominees Pty Ltd t/as Cunderdin Roadhouse [2017] WASCA 200
Kanan v Australian Postal and Telecommunications Union [1992] FCA 539
LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12
Marks v Coles Supermarkets [2021] WASCA 176
McKay v Commissioner of Main Roads [2013] WASCA 135
National Companies & Securities Commission v News Corporation Ltd [1984] HCA 29; (1984) 156 CLR 296
Osgood v Wham [2007] WASCA 178
Pacific Industrial Co v Jakovljevic [2008] WASCA 60
Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex Parte Palme [2003] HCA 56; (2003) 216 CLR 212
Rodgers v Amcor Ltd [2018] WADC 134
SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152
Wellstead Building & Renovating v Wellstead CM 25/99, 20 June 1999
Zamora v OCS Services Pty Ltd [2024] WADC 77
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CORMANN DCJ:
Introduction and background
1
This appeal was brought pursuant to s 247 of the Workers’ Compensation and Injury Management Act 1981 (repealed 1 July 2024) (Repealed Act).
2
The appeal relates to two decisions delivered on 1 May 2024 by an arbitrator of the Workers Compensation Arbitration Service. The decisions were made in two applications brought by an employee of the respondent arising from an injury sustained in the course of her employment on 17 March 2017.
3
The appellants were employed by then legal firm, Chapmans Barristers and Solicitors, and were the employee’s representatives in the proceedings.
4
The arbitrator dismissed both applications. He also made orders under s 265(1)(c) of the Repealed Act that the appellants indemnify the respondent for costs incurred under various items of the scale in the Workers’ Compensation (Legal Profession and Registered Agents) Costs Determination 2018 (Determination).
5
It is only the costs orders that are the subject of this appeal.
6
The appellants contend that the arbitrator erred in law in:
(a) incorrectly interpreting and applying s 265(1)(c); or
(b) denying the appellants procedural fairness prior to making the orders under s 265(1)(c).
7
For the reasons that follow:
(a) leave to appeal in respect of ground 1 is refused;
(b) leave to appeal in respect of ground 2 is granted; and
(c) the appeal is otherwise dismissed.
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The appeal to this court
8
This appeal was commenced by Notice filed on 28 May 2024. An Amended Appeal Notice was filed on 30 May 2024. A Re-Amended Appeal Notice was filed on 19 August 2024 which set out the grounds of appeal ultimately argued at the hearing on 4 February 2025.
9
On 1 July 2024, the Workers Compensation and Injury Management Act 2023 (WA) (2023 Act) was enacted. According to s 546(1) and s 546(2) of the 2023 Act:
(a) the 2023 Act operates as a ‘continuation of the former Act and a pending matter continues and must be dealt with under this Act as if it arose under this Act’; and
(b) anything commenced ‘under a provision of the former Act for the purposes of or in connection with a pending matter is taken to have been commenced, and is to continue, under the corresponding provision of this Act’.
10
Pursuant to s 542 of the 2023 Act, a ‘pending matter’ means:
a claim, assessment, proceeding, dispute or other matter commenced or arising under the former Act before commencement day that is pending, current or continuing under the former Act immediately before commencement day.
11
This appeal is a ‘pending matter’ within the meaning of s 542 of the 2023 Act and therefore it falls to be determined under the 2023 Act.
12
By s 391(1) of the 2023 Act, this appeal can only be brought with leave. As no amount of compensation is in issue, the only prerequisite for the grant of leave is that ‘a question of law is involved’ (s 391(2)). Even if a question of law is involved, the grant still lies in the discretion of the court.
13
If the court forms the view that, although a question of law is ‘involved’ but there has not been a relevant error of law, this is a factor which the court may consider relevant to the question of whether leave should be granted.1
14
A failure to award procedural fairness arising from a failure to put a party on notice of a fact or issue when the decision-maker’s evaluation
1 Pacific Industrial Co v Jakovljevic [2008] WASCA 60 [17], [25].
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or conclusion of that fact or issue is one that could not reasonably be
anticipated, may be an error of law.2 In such a case, an appeal court may be able to infer that, if fairly put on notice of that fact or issue, the party might have addressed the fact or issue by way of further evidence or submissions, such that the party may have been deprived of the possibility of a successful outcome.3
15
A decision does not involve an error of law unless the error is material to the decision in the sense that it contributes to the result so that, but for the error, the decision may have been different.4 The test of materiality is whether the arbitrator’s decision would or might have been different if the error had not been made.5
16
The powers of this court on appeal remain the same under the 2023 Act:
(a) the appeal is to be by way of review of the decision appealed against (s 391(5) of the 2023 Act);
(b) evidence that is fresh evidence or in addition to or in substitution for the evidence received in relation to the decision appealed against cannot be given on appeal to this court except with leave (s 391(6) of the 2023 Act); and
(c) on hearing the appeal the court may:
(i) affirm, amend or quash the decision, or substitute, or make in addition, any decision that should have been made in the first instance; and
(ii) subject to s 400, make any further order or decision, as to costs or otherwise, as the court thinks fit (s 391(7) of the 2023 Act).
17
The principles established under the corresponding provision6 in the Repealed Act remain, because the powers on appeal have not changed:
2 Davie v Manuel [2024] WASCA 21 90 referring to Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576, 591 – 592.
3 See, for example, LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12 [14].
4 Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321, 353; BHP Billiton Iron Ore Pty Ltd v Brady [2008] WASCA 250 [15].
5 Marks v Coles Supermarkets [2021] WASCA 176 136.
6 Section 247 of the Repealed Act.
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(a) the ‘review’ is to be in the nature of an appeal by rehearing. It is not sufficient to satisfy the court that a decision other than that made by the arbitrator is correct and preferable. Some material error of fact or law, or some other miscarriage of justice, must be established;7
(b) the determination of whether an error or some other miscarriage of justice is established is generally made on the material before the arbitrator, subject to the court’s power to give leave to adduce additional evidence;8 and
(c) once an error or miscarriage of justice is established, then the appellate court, if it is in a position to do so, substitutes its own decision. The court will ordinarily do so by reference to the facts found by the arbitrator which have not been successfully challenged and such findings of fact that the court is able to make by reference to the written record. In deciding whether the appellate court is able to make findings, regard must be had to the natural limitations of the court working from written material without the benefit of seeing or hearing witnesses.9
18
The appellants must show ‘proper basis’ for disturbing the decision such as an error of ‘fact, law or logic’. It is not sufficient that the court undertaking the review would have come to a different conclusion on the facts to that of the arbitrator. Unless the ‘review’ persuades the court that the arbitrator’s decision should be varied, discharged, or otherwise disturbed, it should stand.10
The evidence on appeal
19
The parties filed two books in the appeal.
20
Pages 1 – 221 of the Appellant’s Appeal Book filed 2 September 2024 is composed of materials that were before the learned arbitrator. The remaining pages 222 – 231 are comprised of communications and documents that were not before the arbitrator. By grant of leave made on 1 October 2024, that evidence was permitted to be adduced in the appeal.
7 Marks [124].
8 Marks [130].
9 Marks [131].
10 Rodgers v Amcor Ltd [2018] WADC 134 [38] (Gething DCJ) (references omitted).
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21
The Respondent’s Appeal Book filed 21 January 2025 is also composed of materials that were before the arbitrator, at pages 4 – 355. The remaining pages, 356 – 368, are comprised of an affidavit and annexures deposed on 30 September 2024 by a solicitor for the respondent. That material, also pursuant to a grant of leave made on 1 October 2024, was permitted to be adduced on appeal.
Arbitrator’s findings
22
This appeal concerns the costs orders made in two decisions arising from an injury sustained by an employee in the course of her employment. Two applications in respect of the injury were brought:
(a) the first, under s 31D(3) and sch 2 of the Repealed Act, for a determination of permanent impairment with respect to alleged compensable lower back and neck injury (A123181); and
(b) the second, for orders under s 61(3) and s 61(4) of the Repealed Act to require the respondent to pay the employee an amount for alleged underpaid weekly payments to ‘top up’ compensation payments for overtime or on call shifts completed prior to her injury (A123182).
23
In written reasons delivered 1 May 2024, both the claims in proceedings A123181 and A123182 were dismissed.
Proceedings A123181
24
In her application for a determination as to permanent impairment, the employee relied on an assessment by Dr Cordova dated 11 April 2019. He assessed her whole person impairment at 7%. The respondent disputed the assessment and sought to rely on evidence from Dr Hammersley who ultimately assessed the degree of permanent impairment as 0%. Dr Hammersley provided reports dating between January 2019 and 26 July 2023.
25
Written submissions filed on behalf of the employee in advance of the hearing included an objection to the tender of Dr Hammersley’s reports on the grounds that, because he had not been made available for cross-examination, his reports were ‘unreliable and inadmissible’. That submission was rejected at the hearing and Dr Hammersley’s reports were received into evidence.11
11 Appellant’s Appeal Book (AAB), AAB 200 – AAB 202, pars 6 – 10.
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26
The arbitrator was not satisfied that the employee had discharged her onus to establish, to the requisite standard, that Dr Cordova’s opinion outweighed that of Dr Hammersley. This was, in essence, because Dr Cordova’s medical reports were ‘stale’12 within the meaning in Wellstead Building & Renovating v Wellstead.13 The arbitrator stated:14
… Dr Cordova’s opinion is based upon his assessment of [the worker] on 15 May 2018 and 11 April 2019. By the time of Dr Hammersley’s final assessment … almost 3½ years later … the factual basis for Dr Cordova’s opinion had changed in that the history provided by [the employee] and the results of Dr Hammersley’s examination of her establish a significant improvement in her medical condition.
27
The arbitrator also expressly rejected various submissions made on behalf of the employee in relation to the medical evidence generally, including:
(a) that the respondent or its insurer had ‘improperly obtained’ Dr Hammersley’s medical reports,15 and
(b) an attempt on behalf of the employee to ‘impugn’ Dr Hammersley’s assessment because, it was contended, he was not ‘legally entitled to reduce [the] assessment by taking account of ‘causation”.
28
That submission, the arbitrator concluded, was ‘nothing more than a bald assertion made without any explication of its legal basis or reference to authority’.16
29
In his reasons, the arbitrator noted that the respondent sought a costs order against either the employee personally, or her representatives pursuant to s 265(1)(c) of the Repealed Act/r 61 of the Workers’ Compensation and Injury Management Arbitration Rules 2011 (WA).17 As regards the basis for that order, this was said to be on:
(a) ‘the inevitability’ of the finding that Dr Cordova’s evidence was ‘patently insufficient’ to establish a reasonable basis for the employee’s claim; and
12 AAB 206, par 20.
13 Wellstead Building & Renovating v Wellstead CM 25/99, 20 June 1999.
14 AAB 206, par 21.
15 AAB 207, par 24.
16 AAB 208, pars 27 – 29.
17 AAB 210, par 35.
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(b) that the representatives’ conduct in litigating the claim enlivened the power to make an order because any reasonable practitioner would have formed the view that the evidence upon which the employee relied was incorrect and unsustainable.18
30
The arbitrator then made the following findings:
(a) the employee’s representative commenced the application in circumstances where he knew or ought to have known that Dr Cordova’s reports were stale in light of Dr Hammersley’s reports;19
(b) the filed application declined to foreshadow further evidence and the arbitrator inferred this meant that the representative did not intend to seek further evidence to rectify the evidentiary deficiency;20
(c) the combination of those two factors constituted commencement of a proceeding ‘without reasonable cause’ within the meaning of those words in s 265(1) of the Repealed Act and was contrary to the ‘interests of the administration [of] justice’ under the Professional Conduct Rules [sic];21
(d) the representative had made a ‘concerted and baseless attempt’ to exclude Dr Hammersley’s evidence by reason of ‘misleading submissions’ regarding the applicable law and in breach of the procedural requirements for an orderly and timely disposition of an interlocutory matter;22
(e) the arbitrator inferred from the attempt to exclude Dr Hammersley’s evidence that the representative knew that Dr Hammersley had opined there had been a significant improvement in the employee’s medical condition and would be preferred to the earlier stale opinion of Dr Cordova;23
18 AAB 210, par 35(b).
19 AAB 216, par 55.
20 AAB 217, par 56.
21 AAB 217, par 57.
22 AAB 217, par 58.
23 AAB 217, par 59.
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(f) the arbitrator said that, in other words, the representative knew that the claim had no prospect of succeeding unless Dr Hammersley’s evidence was excluded and therefore ‘knowingly attempted’ to do so in the ‘concerted, baseless and misleading manner’ previously set out;24 and
(g) this conduct constituted a breach of the duty not to ‘knowingly … mislead’ under the Professional Conduct Rules within the meaning of the words ‘professional misconduct’ and gave rise to costs ‘wasted by misconduct’ within their meaning in s 265(1)(c) of the Repealed Act.25
Proceedings A123182
31
This application was based on a contention by the employee that the employer had contravened s 61(1) of the Repealed Act by unlawfully reducing her weekly payments on 19 December 2022. In reply, the respondent contended that by that time, the employee was working full time in her pre-injury role without any ongoing incapacity and was being remunerated accordingly.
32
In disposition of this application, the arbitrator determined that, by 19 December 2022, the employee:
(a) was no longer experiencing any incapacity for work arising from the injury, had returned to her pre-injury duties, and was being remunerated by way of salary; and
(b) had made a ‘return to work’ within the meaning of those words in s 61(1) of the Repealed Act, meaning she no longer had an entitlement to weekly payments of compensation with respect to the injury, and her application alleging an unlawful reduction of weekly payments must be dismissed.26
33
The evidence upon which that determination was made included:
(a) that Dr Hammersley conducted his final assessment of the employee on 23 August 2022, and recorded a significant improvement in her medical condition based on the updated history given by her and on his physical examination of her;27
24 AAB 217 – AAB 218, par 60.
25 AAB 218, par 61.
26 AAB 141, pars 24 – 25.
27 AAB 137, pars 15.
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(b) that the employee was medically certified by her treating general practitioner on 27 October 2022 as having full capacity for work with no requirement for further medical treatment;28
(c) the employee’s evidence in her witness statement to the effect that she no longer suffered incapacity for work resulting from the injury and had returned to her pre-injury duties;29 and
(d) the employee’s evidence at the hearing, including that from 18 December 2022 she was remunerated by way of salary for full time, unrestricted pre-injury duties in accordance with her payslips produced in evidence.30
34
The arbitrator also made the following findings:
(a) the application ‘served no useful purpose’ because on the employee’s own evidence31 she had already returned to work on full duties without incapacity or restriction resulting from her injury and was being remunerated accordingly including occasional overtime payments;32 and
(b) the conduct of the representative in bringing and pursuing the application meant that the employer incurred costs ‘without reasonable cause’ within the meaning of those words in s 265(1)(c) of the Repealed Act as construed in Kanan v Australian Postal and Telecommunications Union,33 being one ‘where it appears that on the applicant’s own version of the facts, it is clear that the proceeding must fail’.34
Section 265(1) of the Repealed Act and the application for costs against the appellants
35
Section 265(1)(c) of the Repealed Act provided:

265. Costs unreasonably incurred by representative
     (1) If in any proceeding before a dispute resolution authority … costs are incurred improperly or without reasonable cause or are wasted by undue delay or by
     28 AAB 139, pars 17.
     29 AAB 139, pars 19.
     30 AAB 140, par 22.
     31 AAB 139 – AAB 140, pars 19 – 22.
     32 AAB 146, pars 40.
     33 Kanan v Australian Postal and Telecommunications Union [1992] FCA 539 [29] (Willcox J) (Kanan).
     34 AAB 147, par 42.
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     any other misconduct or default, of a legal practitioner agent representing a party (the representative), a dispute resolution authority may make an order –
     …
     (c) directing the representative personally to indemnify any other person than the client against costs payable by the person indemnified.
     36
     In the respondent’s opening submissions filed in August 2023:
     (a) it was disputed that the employee suffered any permanent incapacity, partial or otherwise, arising from the injury. It was contended instead, that from on or about 27 October 2022, she had made a ‘return to work’ as defined for the purposes of the Act, had re-established herself as a wage-earner and no longer needed weekly compensation payments; and
     (b) it was contended that both applications should be dismissed, and that the employee should pay the respondent’s costs.
     37
     It was not suggested or otherwise put in the respondent’s opening submissions that an application would be made pursuant to s 265(1)(c) of the Repealed Act for costs. That application was first raised at the conclusion of the substantive hearings on 15 November 2023, with the relevant exchange as follows:
     MR BAYLY: Sir, if I may make one submission?
     MR FLETCHER: Mmm.
     MR BAYLY: And it might help to put my friend on notice of this. The respondent in both applications will be setting submissions in accordance with section 265 —
     MR FLETCHER: Okay.
     MR BAYLY: — 1 of the Act. Where, not as costs against – costs, but not against the worker sir. Seeking that the worker’s solicitors indemnify the respondent for its legal costs, and that’s provided under section 265(1)(c). There are very particular circumstances in which that can apply. The respondent appreciates the gravity of this submission, however – and this could be raised in closing submissions, but I thought I’d
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     give my friend a professional courtesy to raise it now so that she understands that that’s the position mounted by the respondent. The applicant’s own evidence is that she returned to work … … …
     …
     MR BAYLY: … Based on the applicant’s own evidence, her application was doomed to fail. The inherent issue for determination was actually not an issue at all, on the applicant’s own evidence. The respondent has been put to significant expense of getting up for this arbitration application, attending this arbitration application, and all matters surrounding this arbitration application.
     Of course, it is the applicant’s right to have her matter heard. The respondent does not doubt that. The issue is, the applicant has been represented by solicitors who understand the systems within WorkCover and the Worker’s Compensation Scheme. That is why the respondent is putting a position forward in relation to section 265(1)(c). Sir, I’m not – as I said, I’m merely raising it as a preface to say that hopefully you’re not taken by surprise.
     MR FLETCHER: Well I can see in the – in the submissions there’s been an application, as it were, made for costs. So I’m happy to treat that as the formal cost application that’s required by the rules. It must be an application in writing.
     …
     MR FLETCHER: … Obviously your submissions – closing submissions will need to address the question of costs.
     MR BAYLY: Yes.
     38
     A short time later, the arbitrator proposed orders as to closing submissions and finalising matters in respect of both proceedings:
     MR FLETCHER: … By no later than 23 November, applicant do file and serve closing submissions; next order, by no later than 8 December, respondent file and serve closing submissions; by no later than 18 December, applicant do file and serve any responsive submissions; and the [decision is]
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     otherwise reserved. Now, there will be the question of taxing costs. So I think that the order for these purposes may well be whether costs are awarded in favour of the respondent or not. I’m going to assume the applicant might be making an application for costs as well.
     MR BAYLY: Yes.
     MS SAVILLE: Mm’hmm.
     MR FLETCHER: … I’ll just deal with that aspect of it first, making the order for costs, and then it can be along the lines of to be taxed if not agreed. And if there’s a taxation required then the bills of costs can be filed, and we can go to a taxation. So I’ll just deal with liability for costs first up and then come back for a taxation, if it’s required.
     39
     The arbitrator reserved his decision in both proceedings and on the question of costs ‘pending closing submissions’. He made orders as follows:
     Current position:
     The arbitration hearing in this matter was concluded today and the decision determining the matter and the question of costs is reserved pending closing submissions in writing.
     Orders:
266. By no later than 23 November 2023 the applicant do file and serve formal closing submissions.
267. By no later than 8 December 2023 the respondent do file and serve formal closing submissions in reply.
268. By no later than 18 December 2023 the applicant do file and serve any formal responsive submissions.
269. The decision in this matter is reserved.
     40
     On 24 November 2023, written closing submissions on behalf of the employee were filed in proceedings A123181.35 No closing submissions were filed at all on behalf of the employee in A123182.
     41
     The employee’s submissions that were filed in A123181 consisted of just three paragraphs. The submissions failed in most, if not all
     35 AAB 188.
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     respects, to
     deal with any of the matters relevant to the arbitrator’s determination of the issues in the proceeding. Further, and, notwithstanding the orders of 15 November 2023, the document also made no submission about, or reference at all, to the costs of the proceeding, nor the application under s 265(1)(c) of the Repealed Act.
     42
     The respondent filed written closing submissions in A123181 on 7 December 2023, served by email on the same day to Chapmans.36 The respondent filed written submissions in A123182 on 12 December 2023.37 According to the appellant’s written submissions in this appeal, they were electronically served on Chapmans on the same day.38 In the respondent’s written submissions, it:
     (a) contended that the proposition that was contained in the employee’s submissions in A123181 was simply incorrect, bordering on misleading, and ultimately, entirely wrong as a legal proposition;
     (b) noted that, as the arbitrator had reserved the question of costs pending written submissions, it had included its submissions about costs; and
     (c) submitted that the proceedings were frivolous or vexatious, or, brought without proper justification pursuant to s 264 of the Repealed Act.
     43
     The respondent also submitted that the discretion to order that the employee or her representatives pay costs was enlivened because:
     (a) the claims depended on a medical opinion based on facts which did not accurately, or even remotely, reflect employee’s condition;
     (b) her reliance on that opinion was inconsistent with her own evidence, and
     (c) furthermore, the conduct of the representatives in litigating the application occurred in circumstances where any reasonable practitioner would have formed the view that evidence on which the employee relied was incorrect and unsustainable.
     36 AAB 189 – AAB 195 and AAB 222 – AAB 223.
     37 AAB 120 – AAB 129.
     38 AAB 5.
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     44
     In the meantime, in written submissions in this appeal, the appellants stated that:
     (a) on 30 November 2023, the first appellant’s practising certificate was suspended by order of the State Administrative Tribunal; and
     (b) on 7 December 2023, ‘as a result of Chapmans Barristers and Solicitors ceasing to carry on business as a legal practice’, the conduct of the employee’s file was transferred to a new firm, namely Premier Legal.
     45
     On 14 and 19 December 2023, Premier Legal filed a Form 162 Notice of Representation in both proceedings, noting that the firm had commenced acting for the employee effective 11 December 2023 and 13 December 2023.39 By letter dated 1 January 2024, Premier Legal then notified WorkCover as follows:
     We confirm that the applicant does not intend on providing any further submissions in respect to the above matters.
     Without providing any detailed submissions in respect of the matter of costs raised by the respondent, we do not consider that the provisions of s.265 of the Act are enlivened upon the evidence by the parties where there is/was clearly an arguable dispute.40
     46
     The learned arbitrator subsequently made and delivered the determinations.
     The grounds of appeal
     47
     The appellants bring the appeal on two grounds.
     48
     First, the appellants contend that the arbitrator erred in law in denying them procedural fairness, by the following ‘particulars’:
     (a) section 188 of the Repealed Act requires the arbitrator to abide by the rules of natural justice;
     (b) the arbitrator knew, by no later than 1 January 2024 (and before making the costs orders) that the employee was represented by Premier Legal and was no longer represented by either of the appellants;
     (c) in any event, despite the obligation in s 188 of the Repealed Act, the arbitrator failed to notify either of the appellants of his
     39 AAB 224, AAB 226.
     40 AAB 228.
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     intention to make, or consider making, costs orders against them; and
     (d) further, the arbitrator failed to provide either of the appellants the opportunity to be heard before making the order.
     49
     Second, and in the alternative, the appellants contend that the arbitrator erred in law in wrongly interpreting and applying s 265(1) of the Repealed Act, by the following ‘particulars’:
     (a) the respondent sought an order pursuant to s 265(1)(c) of the Repealed Act, not s 265(1)(a) or s 265(1)(b);
     (b) the arbitrator misunderstood and misapplied the legal tests that constitute the incurring of costs ‘improperly’ or ‘without reasonable cause’ or which are ‘wasted by undue delay or by any other misconduct’;
     (c) the respondent carried the onus of proof to persuade the arbitrator to make such an order;
     (d) the respondent failed to point to any reliable evidence to establish that costs were incurred ‘improperly’ or ‘without reasonable cause’ or were ‘wasted by undue delay or by any other misconduct or default’ by either of the representatives;
     (e) the arbitrator made a number of assumptions unsupported by reliable evidence in making the orders; and
     (f) the arbitrator failed to establish any causal connection between the alleged conduct of the appellants and the costs incurred and failed to apply or consider the provisions of s 265(2) of the Repealed Act.
     50
     The ‘procedural fairness ground’ was ground 2 in the Notice. However, it was argued first in the appeal and I have dealt with it first in these reasons. That is because, as submitted by the appellants, if ground 2 was successful there would be no need to deal with ground 1, which the appellants argued in the alternative.
     Should the appellants have leave to appeal?
     51
     Both appeal grounds involve a question of law. However, the grant is still within the discretion of the court.
     52
     This is an appeal on costs alone, and from that perspective, as a monetary sum it could be considered completely disproportionate
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     to the issues in question.
     41 For example, the respondent adduced evidence demonstrating that solicitor/client costs relevant to the orders against the first appellant total just $2,779.09.42 However, the appeal arises in the context of personal costs orders, rather than the ‘usual costs’ that follow in a proceeding. They involve adverse findings about the conduct of party’s representatives in litigation. On a question of whether procedural fairness might have been denied to a party in that context, I consider that leave to appeal should be granted.
     53
     However, leave to appeal in respect of the s 265(1)(c) ground should be refused. While it purports to raise errors as to the interpretation and application of legislative provisions, the particulars and submissions do not reveal any arguable error. The ground is without merit. The appellants do no more than express dissatisfaction with the exercise of the power, and I can see no public interest to be served in the grant.
     Procedural fairness ground
     Relevant principles
     54
     The principles relating to procedural fairness are well settled and outlined in recent Court of Appeal decisions including Davie v Manuel,43 Defendi v Szigligeti,44 and Frigger v Frigger.45
     55
     I adopt the helpful summation in Zamora v OCS Services Pty Ltd46 as to those relevant principles. Further, and as the learned Judge in Zamora also observed, the content of procedural fairness will ordinarily need to be understood having regard to the nature of the proceedings. Arbitration disputes under the Act should generally be amenable to being determined efficiently and expeditiously. Provided that a reasonable opportunity to present their case is given to the parties, issues dealt with by an arbitrator under the arbitration process needs to be flexible and account for the informality of the procedure in that process.47
     41 See Johnson v Denwest Nominees Pty Ltd t/as Cunderdin Roadhouse [2017] WASCA 200 [118] – [122].
     42 RAB 356 – RAB 368.
     43 Davie [83] – [91].
     44 Defendi v Szigligeti [2019] WASCA 115 [45] – [48].
     45 Frigger v Frigger [2023] WASCA 103 [38] – [41].
     46 Zamora v OCS Services Pty Ltd [2024] WADC 77 51.
     47 Zamora [51.4].
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     56
     It was observed by the Court of Appeal in Davie that:
     (a) generally speaking in litigation, the parties must anticipate combinations and permutations of various findings and adduce evidence and make submissions at the trial on all the potential findings of fact on the issues litigated. Any gap in the evidence on an issue will generally operate to the detriment of the party carrying the burden of proof on that issue;48
     (b) a person to whom procedural fairness is owed is, ordinarily, entitled to have brought to his or her attention the critical issues or factors on which the decision is likely to turn so as to give the person an opportunity to deal with them. However, a decision-maker is not usually required to disclose to a person to whom procedural fairness must be accorded the decision-maker’s mental processes, provisional views or proposed conclusions before a final decision is made.49 The position may be different when the decision-maker’s evaluation or conclusion is one that could not have reasonably been anticipated.50 In this context, the observations of the Full Court of the Federal Court in Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd51 are relevant:
     Within the bounds of rationality a decision-maker is generally not obliged to invite comment on the evaluation of the subject’s case …
     The general propositions set out above may be subject to qualifications in particular cases. Two such qualifications were enunciated by Jenkinson J in Somaghi at 108 – 109:
270. The subject of a decision is entitled to have his or her mind directed to the critical issues or factors on which the decision is likely to turn in order to have an opportunity of dealing with it: Kioa v West at 587 (Mason J); Sinnathamby at 348 (Burchett J); Broussard v Minister for Immigration and Ethnic Affairs (1989) 21 FCR 472 (Burchett J).
     48 McKay v Commissioner of Main Roads [2013] WASCA 135 [156].
     49 Apache Northwest Pty Ltd v Agostini [No 2] [2009] WASCA 231 [217].
     50 Commissioner for Australian Capital Territory Revenue, (591) – (592); McKay v Commissioner of Main Roads [157]; Apache Northwest Pty Ltd v Agostini [No 2] [217] – [218].
     51 Commissioner for Australian Capital Territory Revenue (591) – (592).
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271. The subject is entitled to respond to any adverse conclusion drawn by the decision-maker on material supplied by or known to the subject which is not an obvious and natural evaluation of that material – Minister of Immigration and Ethnic Affairs v Kumar (unreported, Full Court, Federal Court, 31 May 1990); Kioa v West at 573, 588 and 634.
     The appellants’ submissions
     57
     In written submissions in the appeal, the appellants contend that:
     (a) the arbitrator denied procedural fairness by not alerting the appellants to the ‘possibility he would make adverse costs orders against them and not allowing them the opportunity to be heard in relation to that possibility’;52
     (b) the denial was patent because this is not a case where it can be said that the opportunity to present evidence and make submissions could not have made a difference to the outcome; and
     (c) the appeal ought to be allowed and the matter remitted to a different arbitrator for a determination according to law.53
     58
     At the hearing, counsel for the first appellant distilled the procedural fairness ground into four points:
     (a) first, the arbitrator’s specific complaints against the appellants were never put to them, and neither appellant was afforded an opportunity to respond to the allegations;
     (b) second, the arbitrator dispensed with the usual process, that an application be made after a published decision in the proceedings;
     (c) third, the arbitrator incorrectly understood Premier Legal to be acting for the appellants as well as the employee and incorrectly considered correspondence from that firm on 1 January 2024 to represent the appellants’ position; and
     52 First Appellant’s Written Submissions, par 32. On 31 January 2025, the second appellant filed a submission indicating that she adopted the first appellant’s submissions in the matter (Appellants’ Submissions) and had nothing further to add.
     53 Appellants’ Submissions, par 37.
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     (d) fourth, if the learned arbitrator was minded to make findings against the appellants in the nature of ‘knowingly mislead’ contrary to conduct rules, the arbitrator should first give notice to the person so they can respond to such proposed finding.
     Were the appellants denied procedural fairness?
     59
     In par 2.1 of the particulars, the appellants state that s 188 of the Repealed Act required the arbitrator to abide by the rules of natural justice. While this is not properly a ‘particular’, consideration of the arbitrator’s obligations in this respect is nonetheless mandated. The appellants submit that the obligation in s 188 of the Repealed Act applied to the appellants as well as the employee. Further, that the arbitrator is obliged by the common law to afford natural justice to the appellants in any event. I accept that.
     60
     Natural justice requires that a party be given a reasonable opportunity to present their case.54 What amounts to a reasonable opportunity to present a case depends upon the circumstances of the case, the nature of the jurisdiction, the subject matter that is being dealt with and the statutory provisions governing the power or jurisdiction being exercised.55 As a general rule a person is not afforded a reasonable opportunity to present his case if he is not entitled to put information and submissions to the decision-maker in support of an outcome that support of his interests.56
     61
     The learned arbitrator did not err in failing to afford the appellants procedural fairness or to apply the principles of natural justice. This is because:
     (a) notice of an application under s 265(1)(c) against the appellants was given, and taken as made, at the hearing on 15 November 2023. That was in the presence of the second appellant who was representing the employee at that hearing, and during the period that the appellants had the conduct of both proceedings on behalf of the employee;
     54 Cameron v Cole [1944] HCA 5; (1994) 68 CLR 571, 589; Cullen v Woodside Energy Ltd [2021] WADC 56 [46] (Stavrianou DCJ) (Cullen).
     55 National Companies & Securities Commission v News Corporation Ltd [1984] HCA 29; (1984) 156 CLR 296, 311 – 312 (Gibbs CJ); SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 [26]; Cullen [47].
     56 Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (591) – (592); Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex Parte Palme [2003] HCA 56; (2003) 216 CLR 212 [22]; Cullen [48].
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     (b) the learned arbitrator made it clear in that hearing and in the orders made that he intended to deal with the s 265(1)(c) application and costs, together with the substantive decisions in both proceedings, and after receipt of written submissions;
     (c) the orders set down a timetable for the employee and the respondent to make submissions in the proceedings as well as on costs and, in the case of the employee, submissions in reply to the respondent’s submissions; and
     (d) section 265 of the Repealed Act is expressly entitled ‘costs unreasonably incurred by representative’. It empowers an arbitrator to make an order directing a representative to personally indemnify a person against costs payable by the person indemnified where ‘costs are incurred improperly or without reasonable cause or are wasted by undue delay or by any other misconduct or default’, of a legal practitioner or agent representing a party.
     62
     Notwithstanding the opportunity in [61(c)] above, and the express provisions in s 265(1)(c) set out in [61(d)] above, of which the appellants were on notice, the appellants then failed:
     (a) in submissions that were filed in proceedings A123181 to address substantively (or at all) any of the issues arising in the proceedings including on costs and on the application under s 265(1)(c); and
     (b) to file any submissions at all in respect of proceedings A123182.
     63
     In submissions subsequently filed by the respondent, the case for costs against the appellants under s 265(1)(c) was then put. That was done because, as noted by the respondent the learned arbitrator had held that ‘the question of costs is reserved pending closing submissions in writing’.57 The case put included that a contention made on the employee’s behalf bordered on misleading and was entirely wrong as a legal proposition, and that the appellants had conducted the proceedings in circumstances where any reasonable practitioner would have formed the view that the evidence on which the application was based was incorrect and unsustainable.
     57 AAB 191, par 5.1.
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     64
     The appellants contend that the learned arbitrator erred in denying procedural fairness by ‘not alerting them to the possibility that he would make adverse costs orders against them and not allowing them the opportunity to be heard in relation to that possibility.58 However, in my view, there was no error of that nature by reason of the facts in [61], [62] and [63], above. It was clear, from at least 15 November 2023, that it was a live possibility that the arbitrator would make adverse costs orders under s 265(1)(c) of the Repealed Act. By reason of the express provisions enlivening the discretion to award costs, and the respondent’s written submissions, the appellants were on notice as to what was being put.
     65
     I also do not consider that it was incumbent upon the arbitrator to make any additional or separate order on 15 November 2023 to allow the appellants to make submissions over and above the opportunity given to the employee.
     66
     At the appeal hearing, the first appellant’s counsel submitted that the costs application on 15 November 2023 immediately put the appellants in a position of conflict with the employee. I accept that conflict might arise in many cases. However, in the present case, if the basis for any opposition by the appellants to the s 265(1)(c) application arose by reason of their instructions, then, given notice of the application, such conflict should have been raised and dealt at any time after that point, including by the first appellant who was a legal practitioner. No such conflict was identified nor raised and no separate opportunity sought to adduce new evidence or make submissions separately to that of the employee. The learned arbitrator did not deliver the decisions until May 2024.
     67
     That a new firm subsequently took on the conduct of proceedings on behalf of the employee was also not relevant. The appellants had been on notice, long before then, as to the live possibility of s 265(1)(c) orders. Notwithstanding, within the timetable allowed and while they had the conduct of the proceedings, the appellants then failed to address any of the issues in the substantive proceedings, nor the question of costs, at all. That was through no error or denial of procedural fairness by the arbitrator.
     68
     It follows that I do not consider that either of the appellants were not afforded a reasonable opportunity to present their case. They were not disentitled from putting information or submissions to
     58 Appellants’ Written Submissions, par 32.
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     the decision
     -maker about an outcome supportive of his or her interests at any time after the s 265(1)(c) application was made.
     69
     In particular 2.2, the appellants contend that the learned arbitrator knew, by no later than 1 January 2024 that the employee was represented by a new firm and was no longer represented by the appellants. The appellants also contend that it could be inferred that the arbitrator incorrectly understood Premier Legal to be acting for the appellants.
     70
     However, even if that was the case, I consider that to accept a submission that the learned arbitrator was then obliged to alert them to the potential for costs orders under s 265(1)(c) of the Repealed Act and his proposed findings, would go further than what the established principles of procedural fairness and natural justice require. This is because:
     (a) the bases in s 265(1)(c) on which the discretion to award costs is enlivened is clear, including that it requires certain findings that are adverse to a representative to be made;
     (b) the appellants’ submission tends towards the proposition that the decision-maker was obliged to disclose to them his ‘mental processes, provisional views, or proposed conclusions before a final decision is made’;59 and
     (c) that the learned arbitrator might reach an adverse conclusion both in respect of the employee’s position and in respect of the appellants’ conduct for the purposes of costs, was a possibility that the appellants could reasonably anticipate and were on notice of.
     71
     Ultimately, the respondent contends, and I accept, that even if the arbitrator should have provided, but failed to provide, the appellants some other opportunity to be heard on the possibility he would make orders under s 265(1)(c) (or, what the basis for those orders might be) the appellants have not established that such decision was ‘clearly wrong’.60 This is because the findings by the arbitrator as to the merits of the employee’s claims, in light of the employee’s own evidence and the state of the medical evidence, were not challenged on appeal. The finding that costs were incurred ‘without reasonable cause’ in both proceedings appears plainly to be correct and has not been challenged.
     59 See Apache Northwest Pty Ltd v Agostini [No 2] (Buss JA).
     60 Osgood v Wham [2007] WASCA 178 [80].
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     This court should therefore be slow to interfere with the arbitrator
     ‘s exercise of discretion,61 and I am not persuaded that the decision should be varied, or changed or otherwise disturbed. It follows that the procedural fairness ground must fail.
     Section 265(1)(c) ground
     72
     Section 265(1)(c) of the Repealed Act empowered the arbitrator to direct a party’s representative to personally indemnify any person other than the client against costs payable by the person indemnified if costs in any proceeding were:
     (a) incurred improperly; or
     (b) incurred without reasonable cause; or
     (c) wasted by undue delay or by any other misconduct or default of the representative.62
     73
     In proceedings A123181 the arbitrator found that:
     (a) the proceeding was commenced ‘without reasonable cause’ within the meaning of the words in s 265(1)(c) and contrary to the administration of justice; and
     (b) the representatives engaged in conduct which resulted in costs being wasted by misconduct, by reason of a knowing attempt to exclude expert evidence in a concerted, baseless and misleading manner.
     74
     In proceedings A123182 the arbitrator found that costs were incurred ‘without reasonable cause’ because it was a proceeding in which it was clear that on the employee’s own version of the facts, it must fail.
     Analysis and disposition of s 265(1)(c) ground
     75
     In written submissions in the appeal, the appellants contended that both applications ‘had merit and were supported by reliable evidence’. The appellants did not make any further submission as to how that was, nor did they apply to adduce any additional evidence that might have otherwise supported that submission. The appellants also did not contest the material findings of the learned arbitrator on which the costs orders were based, including that:
     61 Respondent’s Submissions, pars 8.32, 8.33.
     62 The corresponding provision in the 2023 Act is s 398(1) and is essentially unchanged.
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     (a) when the proceedings were commenced in July 2023 the representative knew or ought to have known that Dr Cordova’s opinions on which his client was seeking to rely were ‘stale’ in light of Dr Hammersley’s opinions;
     (b) from the outset, the applications filed declined to foreshadow further evidence in accordance with r 25(3) and it could therefore be inferred that the did not intend to seek to obtain further evidence to rectify the deficiencies in the expert evidence;
     (c) before the commencement of proceedings (by 19 December 2022), the employee had resumed working full-time without restriction in her pre-injury role and duties, and she was remunerated by way of a salary; and
     (d) the employee was a forthright and honest witness who ‘blithely’ gave unequivocal evidence that she had returned to work following any earlier incapacity.
     76
     Those unchallenged findings enliven the discretion to make orders under s 265(1)(c) of the Repealed Act. Those findings support a conclusion that costs in each proceeding were incurred ‘without reasonable cause’ within the meaning of Kanan, as found by the learned arbitrator. It follows that, by reason of those findings, any costs incurred in the proceedings under the items in the Determination can properly be considered to have been incurred ‘without reasonable cause’.
     77
     In my view, to establish error on the part of the learned arbitrator in his exercise of discretion under s 265(1)(c) on appeal, it was incumbent on the appellants to articulate a case on the available evidence, or to apply to adduce additional evidence, challenging those underlying findings, and to establish how it was that the applications had merit and were supported by reliable evidence. Otherwise, any error that might have been made would not be material.
     78
     I accept that, in the first place, the appellants contended in this appeal that they were denied procedural fairness and did not have an opportunity to put forward a case in opposition to the s 265(1)(c) application. I accept that their contention is that the arbitrator erred in this respect, and that the matter should be sent back for determination according to law. However, there has been nothing put on appeal to support the contention that, contrary to the arbitrator’s finding, either of
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     the applications had merit and were supported by reliable evidence.
     Absent that, regardless of the arbitrator’s findings as to the conduct by the representatives in the litigation, costs in both proceedings were incurred ‘without reasonable cause’. As a result, there has been a lawful exercise of discretion under s 265(1)(c) and the appellants have failed on appeal to demonstrate how the test was not properly applied by the arbitrator in this case.
     79
     Finally, the appellants contend that the process adopted by the arbitrator in determining the applications and making costs orders at the same time was not a proper application of s 265(1)(c) of the Repealed Act. I reject that submission for the following reasons:
     (a) costs ordinarily follow on determination of a substantive proceeding in a party’s favour, and there was nothing unusual about the process, in light of the decision to dismiss both proceedings, for the arbitrator to make costs orders at the same time;
     (b) while I accept that s 265(1)(c) orders are not ‘usual’ costs orders, and that a personal costs order is a serious matter, the appellants were on notice that it was a live possibility such order might be made. The parties were given an opportunity to address that application and in in my view, this means there was nothing unusual or untoward about the learned arbitrator dealing with his substantive decisions and costs at the same time; and
     (c) finally, as submitted by the respondent, the arbitrator was obliged to determine the applications according to their substantial merit with as little formality and technicality as practical. It was not incumbent on him to seek further submissions on costs when the parties had already been given an opportunity to do so at the end of the hearing.63 The process adopted was essentially in keeping with the arbitrator’s obligations in that respect under the Repealed Act, in my view.
     80
     Ultimately, this was an appropriate case for the arbitrator to make the s 265(1)(c) orders at the same time as the substantive decisions. The evidence given by the employee was entirely contrary to her claims, and was unsupported by appropriate medical evidence. At the conclusion of the hearing, the appellants were then immediately put on notice of the s 265(1)(c) application, and yet, they failed to address it at all.
     63 Respondent’s Submissions, par 8.31.
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     81
     Overall, the respondent submits, and I accept, that even if the court was to conduct a ‘real review’ of the decisions, it would invariably come to the same result as the learner arbitrator. The appellants have failed to produce any persuasive reason as to how the result could be any different if they had provided further submissions or evidence to the arbitrator. Instead, they proceeded on appeal without challenging the factual findings of the learned arbitrator about the merits of the proceedings and did not apply to produce fresh evidence which might demonstrate how the result below could be different.64
     82
     For the reasons outlined, no error in the interpretation or application of s 265(1)(c) of the Repealed Act has been established. There is no merit in that ground of appeal.
     Conclusion
     83
     I consider the appropriate final orders are:
     (a) leave to appeal in respect of ground 1 (the s 265(1)(c) ground) is refused;
     (b) leave to appeal in respect of ground 2 (the procedural fairness ground) is granted;
     (c) the decisions of the arbitrator in A123181 and A123182 are affirmed, and the appeal is dismissed; and
     (d) the appellants to pay the respondent’s costs of the appeal to be taxed if not agreed.
     64 Respondent’s Submissions, par 8.34, 8.35.
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     I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
     SI
     Associate
     9 APRIL 2025