Motor Accidents compensation - Costs - Applicable legislation as to costs - Costs follow the event - Scale of costs

Motor Accidents (Liabilities and Compensation) Act 1973;

Motor Accidents (Liabilities and Compensation) Regulations 2020;

Motor Accidents (Liabilities and Compensation) (Tribunal) Regulations 2019;

Tasmanian Civil and Administrative Tribunal Act 2020;

Latoudis v Casey (1990) 170 CLR 534; [1990] HCA 59;

Warner v Motor Accidents Insurance Board [2018] TASMACT 3; Oshlack v Richmond River Council [1988] HCA 11 (1998) 193 CLR 72; Northern Territory v Sangare [2019] HCA 25; Bennett v Motor Accidents Insurance Board [2108] TASMACT 2

1. The applicant, Mr Gray, was involved in a motor vehicle accident in January 2022.
2. On 13 October 2023, the applicant filed a referral in the Tribunal pursuant to the Motor Accidents (Liabilities and Compensation) Act 1973 (the MAIB Act). He was aggrieved by a decision of the Motor Accidents Insurance Board (the MAIB) to refuse to pay him a disability allowance as a scheduled benefit in accordance with the Motor Accidents (Liabilities and Compensation) Regulations 2020 (the MAIB Regulations).
3. The applicant's referral was determined by me in Gray v Motor Accidents Insurance Board [2025] TASCAT 47, where I dismissed the referral.
4. The MAIB now seeks an order that the applicant pay the respondent's costs of the referral, and of this application.
5. The application for costs is what now needs to be determined.

1. The Motor Accidents (Liabilities and Compensation) (Tribunal) Regulations 2019 (the MAIB Tribunal Regulations) provides at r 14:

On determining a reference, the Tribunal may order a party to the reference to pay costs to another party to the reference.

2. The Tasmanian Civil and Administrative Tribunal Act 2020 (the TASCAT Act) provides at s 120:

120. Costs of parties > > (1) Unless otherwise specified in this Act, a relevant Act, regulations under a relevant Act or an order of the Tribunal under this section, parties bear their own costs in any proceedings before the Tribunal. > > (2) Unless otherwise specified in a relevant Act or regulations under a relevant Act, the Tribunal may make an order for the payment by a party to proceedings of all or any of the costs of another party to the proceedings, or of a person required to appear before the Tribunal or to produce evidentiary material, if the Tribunal considers that it is appropriate to do so after taking into account - > > (a) the main objectives of the Tribunal that are relevant to simplifying proceedings and issues before the Tribunal and to keeping costs to parties in proceedings to a minimum insofar as is just and appropriate; and > > (b) the need to ensure that proceedings are fair and that parties are not disadvantaged by proceedings that have little or no merit; and > > (c) any provision made by the Tribunal rules or the regulations under a relevant Act; and > > (d) any other matter considered relevant by the Tribunal. > > (3) Subsections (2) and (4) do not apply in relation to proceedings in the Mental Health stream or in the Guardianship stream. > > (4) Without limiting subsection (2), if the Tribunal dismisses or strikes out any proceedings in any prescribed circumstances, the Tribunal should also make an order for costs against the party against whom the action is directed, unless the Tribunal is of the opinion that there is a good reason for not making an order in the circumstances of the particular case. > > (5) If the Tribunal makes an order for the payment of costs and does not fix the amount of costs, that amount is to be assessed and settled in accordance with the Tribunal rules, or regulations under a relevant Act, that make provision in relation to such costs.

If there is an inconsistency between a provision of a relevant Act and a provision of this Act, the Regulations or the Tribunal Rules, the provision of the relevant Act prevails to the extent of the inconsistency.

4. By virtue of Schedule 1 of the TASCAT Act, the MAIB Act is a 'relevant Act' for the purposes of s 7A and s 120 of the TASCAT Act.

1. The MAIB notes that the usual principle relating to costs in civil proceedings is that there is an award of costs to compensate the successful party. The MAIB refers to the dictum of McHugh J in Latoudis v Casey (1990) 170 CLR 534; [1990] HCA 59 (Latoudis) at [3]:

An order for costs indemnifies the successful party in litigious proceedings in respect of liability for professional fees and out-of-pocket expenses reasonably incurred in connection with the litigation... The rationale of the order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred. The order is not made to punish the unsuccessful party. Its function is compensatory. Thus, in civil proceedings an order may, and usually will, be made even though the unsuccessful party has nearly succeeded or has acted reasonably in commencing the proceedings. It may, and usually will, be made even though the action has failed through no fault of the unsuccessful party.

2. The MAIB also submits that r 14 of the Regulations gives the Tribunal an unfettered discretion to award costs, and refers to Warner v Motor Accidents Insurance Board [2018] TASMACT 3 where Chairperson Webster noted the unfettered discretion under r 14, and also noted that the usual practice in the former Motor Accidents Compensation Tribunal in relation to costs was to order the unsuccessful party to pay the successful party's costs of the reference.
3. As the applicant's original referral was dismissed, the MAIB is the successful party, and says that on that basis an award of costs ought to be made in its favour.
4. In relation to the considerations under s 120(2) of the TASCAT Act, the MAIB submits:
   • It reasonably incurred the expenses of litigating the proceeding which was brought on by the applicant's referral;
   • The reasonableness of the applicant commencing the proceedings has limited significance as to whether the Tribunal should make an order for costs in favour of the MAIB;
   • The principle on awarding costs to the successful party, as set out in Latoudis, is binding on the Tribunal and the Tribunal should not depart from the legal principle that costs ordinarily follow the event; and
   • There is nothing out of the ordinary with respect to the referral that should lead the Tribunal to depart from the ordinary course with respect to a costs order.

1. The applicant says that there should be no order for costs.
2. The applicant raises the following matters in relation to the costs issue:
   • When the MAIB rejected his application for a disability allowance they just sent a rejection letter without any reference to the Act or any reference to the parts of the Act that affected his claim. Because of his limited education he could not understand what the MAIB was saying, and the letter told him that if he wished to dispute the decision he had to appeal it to the Tribunal.
   • At a conciliation conference in December 2023 there was no mention of the Act or any reference to the Act and all he was told was that the MAIB do not pay on income derived from a capital gain.
   • He was not made aware of the Act or made aware of any parts of the Act that affected his claim until a directions hearing in February 2024 when he was asked if he was aware of the Act and whether he had a copy of the relevant legislation, as a result of which he as provided with a copy of the Act and the Regulations by the Tribunal. In the same directions hearing he advised the Tribunal that he believed he was being blackmailed into giving up his case because the MAIB was offering not to pursue costs if he was to drop the case.
   • He received a letter from the MAIB in March 2024 in response to a request made by a State Government Minister. In January 2024 the letter from the MAIB stating that Part V of Schedule 1 of the MAIB Regulations was the reason for the rejection of his claim.
   • He has been unable to find a law firm that is able to assist him.
   • He advised the MAIB's solicitor on the telephone that he is mentally and financially broken.

1. Because of the provisions of the TASCAT Act, both s 7A, and the wording of s 120, the costs provision in regulation 14 of the MAIB Tribunal Regulations prevails.
2. Regulation 14 gives the Tribunal an unfettered discretion in relation to the award of costs relating to proceedings referred to the Tribunal under the MAIB Act. I accept the MAIB's submission that where an unfettered discretion to award costs exists in civil proceedings, the usual order is that the unsuccessful party must pay the successful party's costs.
3. It is recognised as a matter of principle that a successful party may be deprived of an order for costs where that party has engaged in 'disentitling' conduct in relation to the conduct of the litigation. In the present case there has been no such conduct by the MAIB.
4. The applicant's submission that he is financially broken is essentially only an assertion to that effect, but even so, impecuniosity of an unsuccessful party is not a reason to deprive a successful party of an order for costs: See Oshlack v Richmond River Council [1988] HCA 11 (1998) 193 CLR 72 and Northern Territory v Sangare [2019] HCA 25.
5. In the first directions hearing before the Tribunal on 29 February 2024, the applicant advised the Tribunal that
   • he had not seen any of the legislation
   • he could not access the legislation
   • he understood there were a couple of words in the legislation that meant he could not get compensation
   • he did not know if the Tribunal could change the legislation
   • he was under the impression that the legislation was a guideline only
   • he did not know whether the Tribunal could go beyond what the legislation says
   • he understood the MAIB's position was that if someone had an ongoing income from capital gain, they are not entitled to anything if they are injured in a motor vehicle accident.
6. I indicated to the applicant at that time that the MAIB and the Tribunal are both constrained by the legislation and cannot go beyond what is permitted by the MAIB Regulations in terms of scheduled benefits.
7. As the applicant noted in his submissions, a copy of the MAIB Act and the MAIB Regulations were sent to him by the Tribunal immediately after the directions hearing, with the relevant parts identified.
8. In respect of the question of costs, in the directions hearing, counsel for the MAIB indicated (in response to my query) that up until the time of the directions hearing, the MAIB had not intended to pursue the costs related to the conciliation process, but reserved its position as to costs if the matter was to proceed to hearing.
9. Following the directions hearing on 29 February 2024, the applicant therefore not only had the relevant legislation available to him, but was on notice as to the possibility of the MAIB seeking an order for costs if the referral proceeded to a hearing.
10. The 'usual order', in proceedings such as the present matter, is that the unsuccessful party is ordered to pay the successful party's costs. In the present instance, there is no reason to depart from that.
11. Historically, orders in relation to costs by the former Motor Accidents Compensation Tribunal were made at the rate of 85% of the relevant Supreme Court scale of costs. It is appropriate to make a costs order consistent with that practice: See Bennett v Motor Accidents Insurance Board [2108] TASMACT 2.

1. The applicant is to pay the Motor Accidents Insurance Board's costs of the referral, such costs to be taxed, if not agreed, at the rate of 85% of the fees set out in Part 1 of Schedule 1 of the Supreme Court Rules 2000.