Background
This case involved a dispute about whether costs paid to applicants for work performed in the conciliation phase of proceedings under the Return to Work Act 2014 (SA) (‘RTW Act’) includes, or is payable in addition to, the Good and Services Tax (‘GST’) payable under the A New Tax System (Good and Services Tax) Act 1999 (Cth) (‘GST Act’).
By way of background, the applicant’s claim for compensation brought under the RTW Act was resolved by orders wherein it was agreed that the applicant was entitled to the maximum amount of costs payable at conciliation under the Return to Work Regulations 2015 (‘RTW Regs’).
In addition, the applicant then sought to have any GST payable under the GST Act paid by the respondent.
Relevant Legislation
Section 106(1) of the RTW Act provides that a party is entitled to an award against the relevant compensating authority for the party’s reasonable costs of the proceedings.
However, s 106(1) is limited by reg 44(1) of the RTW Regs which provides that the costs awarded to a party who is represented in proceedings before the South Australian Employment Tribunal cannot exceed:-
$402 (indexed) for assistance in the preparation and lodgement of an application to the Tribunal; and
$745 (indexed) for participation in proceedings before the Tribunal up to and including conciliation (unless the Tribunal determines that the party is entitled to an award of costs greater than $745, in which case the maximum award is $2,464 (indexed)).
Further, s 106(6) of the RTW Act provides that an award of legal costs cannot exceed 85% of the amount that would be allowed under the relevant Supreme Court scale.
Applicant’s Submissions
The applicant argued that GST is recoverable on costs by relying on r 192.1 of the Uniform Civil Rules 2020 (SA) (‘UCR’) which provides that the Higher Courts costs scale is fixed by sch 6 pt 2 note 2, which provides that GST is to be added to the costs outlined in the Scale, except in certain circumstances which do not apply in this case. This notion is also reflected within the Magistrates Court costs scale, as well as the Minor Civil costs scale.
The applicant submitted that if that proposition is not accepted, and it is found that reg 44 of the RTW Regs and the applicable scale of costs in SAET does not expressly deal with GST, r 7 of the SAET Rules 2024 (SA) would apply so as to adopt the UCR, meaning the above application of r 192.1 would apply. Rule 7 provides that in circumstances where an issue or procedure is not provided for by the SAET Rules, SAET Act, or another relevant Act, the UCR should be adopted.
Applicant’s Submissions
The applicant further submitted that “s 106(6) of the RTW Act supported the application of GST because it authorises reg 44 which refers to the Higher Courts costs scale which makes differential provision as to the payment of GST depending on whether the recipient is entitled to input credits.”
Respondent’s Submissions
Contrastingly, the respondent submitted that reg 44(1)(b) included two maxima that apply to costs of participating in the conciliation process. Therefore, by awarding GST in addition to the two amounts of costs the applicant received under reg 44(1), the limits imposed by s 106 of the RTW Act and reg 44 would be exceeded.
Findings
Consistent with the respondent’s submissions, Calligeros DPJ held that the two costs maxima in reg 44(1)(b) include the amount of any GST payable, noting that adding GST to the maxima would exceed those maxima. On that basis, His Honour dismissed the application.
His Honour explained that while GST may be payable on costs awarded at the hearing and determination stage of RTW Act proceedings, costs payable under reg 44 (up to and including conciliation) are not based upon the Higher Courts scale of costs and GST is therefore not payable at that stage of proceedings.
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