Hillbrick v TAC [1999] VCAT 80

1. On 4 August 1997, the applicant filed an application in the then Administrative Appeals Tribunal, to review a decision of the respondent not to pay loss of earning benefits in June, July and August 1996, which benefits the applicant alleges were payable as a result of a transport accident which occurred on 11 March 1995.

2. When this application was called on for hearing before me, on 2 March 1999, Mr Blackburn, counsel for the applicant, announced that his client accepted an offer of compromise dated 23 February 1999. At this point the respondent's counsel, Mr Rose, informed me that the offer of compromise was not open to be accepted at that time as it had expired and was now withdrawn. Shortly thereafter, the applicant's solicitors handed to the respondent's solicitor a notice in writing purporting to accept the offer of compromise.

"Take Notice that the Respondent offers to compromise the Application for Review on the following basis :

By paying the Applicant $1,000.00 in full settlement of any entitlement he may have to benefits under Sections 49 and 50 of the Transport Accident Act 1986.

This Offer is made on the basis that the Respondent offers to pay the Applicant's costs of the proceedings on County Court Scale A.

This Offer shall remain open to be accepted until the 4.00 p.m. on Friday 26 February 1999.

Take Notice that in the event of acceptance by the Applicant of this Offer of Compromise the time for re-determination and payment shall be 28 days.

Take Notice that in the event that this Offer of Compromise is not accepted and the Application for Review proceeds to Hearing, should the Applicant obtain a determination that is no more favourable than the offer contained herein, the Respondent will present this Offer of Compromise in relation to the Order as to costs in accordance with Section 112 of the Victorian Civil and Administrative Act 1998 (the Act), and Schedule 1, Clause 93 of the Act.

This Offer of Compromise is made with prejudice.

4. Section 114 of the Victorian Civil and Administrative Tribunal Act 1998 (the Act) reads as follows :

"(1) An offer must be open for acceptance until immediately before the Tribunal makes its orders on the matters in dispute, or until the expiry of a specified period after the offer is made, whichever is the shorter period.

(2) The minimum period that can be specified is 14 days.

(3) An offer cannot be withdrawn while it is open for acceptance without the permission of the Tribunal.

(4) In deciding whether to give permission, the Tribunal may examine the offer, even if it was made without prejudice.

(5) If the offer was made without prejudice, a member of the tribunal who examines it for the purposes of sub-section (4) can take no further part in the proceeding after determining whether or not to give permission.

(6) A party can only accept an offer by giving the party who made it a signed notice of acceptance.

(7) A party may accept an offer even though it has made a counter-offer".

5. Mr Blackburn submitted before me that as the offer of compromise was in the form anticipated by Part 8 of the Act and that the Respondent was seeking to impose a time limit which it has no power to do. That would mean I should imply into that offer a minimum period of fourteen days for acceptance pursuant to s114(2). Mr Blackburn also relied upon paragraph 12 of Practice Direction General 3A of VCAT. However, that paragraph does require or imply any particular time period for the offer to remain open, it simply forbids it being withdrawn during the period for which it is expressed to remain open - see paragraph 12(d). These arguments were supported by reference to Transport Accident Commission v Bausch (1999) 1 VR 249, by suggesting that the transport accident scheme should be administered "fairly, honestly and impartially and with proven regard for the purposes for which it was established .....". As a consequence, Mr Blackburn concluded that the time in the offer of compromise had not yet expired and as such was capable of being accepted.

6. Mr Rose on the other hand submitted that the offer of compromise was invalid by its very nature (that is, it did not have a fourteen day time limit for acceptance) and, at best, it was an open offer on limited terms, the time for which acceptance had expired. In the alternative, the respondent sought leave of the Tribunal to withdraw the offer of compromise.

7. Asche CJ sitting in the Supreme Court of the Northern Territory was called upon to consider a similar situation in Benton v Noye and Another [1990] NTSC 21; (1990) 101 FLR 18 and (1990) NTSC 21. The facts of that case are adequately set out in the Head Note which reads as follows :

"A document headed `Offer to compromise' purported to be in compliance with the Supreme Court Rules 1967 (NT). It was served one day before the trial began, and stated that the offer was open to be accepted `at anytime prior to 10 am on the first day of the trial'. However, under r 26.03(3) as to the time such an offer is open to be accepted, `the time expressed shall not be earlier than 14 days after' service on the other party."

"As it stands, this document seems no more than a without prejudice offer, limited in time, which lapses on the expiry of a time limited. In simple contractual terms, an offer to compromise is, as it is stated, an offer; and, failing a counter offer, it is to be accepted in its terms. Where the offer plainly says that it is to lapse after a certain time, then the offer ceases after that certain time".

8. The provisions of s114 of the Act are in sufficiently similar terms to those of r 26.03(3) of the Supreme Court Rules 1967 (NT) that the same principle can be applied to this situation as it was applied by the Chief Justice in Benton's case. That is, the offer made by the respondent in this case, is not an offer within the terms of the Act but merely an offer to settle on the terms contained within the offer itself. Therefore, the offer in fact lapsed at the time stated in the offer which is "4.00 pm on Friday 26 February 1999" which is a number of days prior to its acceptance at the hearing of this application.

9. It necessarily follows that as the offer had lapsed prior to 2 March 1999, it was not then open for the applicant to accept the same as it had lapsed prior to that time.

10. Having decided that the offer was not open to be accepted at the time of the hearing, I do not need to decide whether or not the respondent should have leave to withdraw the offer. In fact, as the offer was outside that contemplated by the Act, it is not a circumstance for which permission is necessary pursuant to s114(3) and (4) or pursuant to General Practice Direction 3A paragraph 12(d).

11. This unfortunate situation which has given rise to a wasted day of hearing, has largely come about by the respondent purportedly delivering an offer in the terms of the Act, but with the condition as to time which took it outside the Act. On the face of the offer, the respondent was attempting to take advantage of the provisions of the Act which would have helped it in an application for costs but was not willing to take the risk on the other hand, of having the offer open for fourteen days. If the respondent truly wished to have an offer only open until 4.00 pm on 26 February 1999, the same would have been better done in a letter form rather than in a form which at first sight, save for the question of the time for acceptance, had been in the form contemplated by the Act. Thus, I believe it is desirable in future, that if the respondent desires to take the course of making an offer which is open for less than fourteen days, the applicant should not be threatened with the sanctions as referred to in s112 of the Act.

12. The applicant has asked for costs of this application however the Respondent has not made submissions on that matter. Therefore, I will reserve the question of costs on this issue.

13. Under these circumstances, I will order that the application be listed for directions for further hearing.

I certify that this and the preceding 7 pages are a true and correct copy of the reasons for decision of Mr Robert W Davis, Presiding Member of the Victorian Civil and Administrative Tribunal.

FOR THE APPLICANT : Mr Blackburn of counsel instructed by Maurice Blackburn & Co

FOR THE RESPONDENT : Mr Rose of counsel instructed by TAC Law