Scottish Court of Session Decisions

The Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58), Second Schedule (7), enacts—“The costs of and incidental to the arbitration and proceedings connected there-with shall be in the discretion of the … arbitrator.”

In an arbitration under the Workmen's Compensation Act 1906 in the Sheriff Court at Dumbarton, William Murphy, 18 Church Street, Kilsyth, respondent, claimed compensation from William Baird & Company, Limited, St Flannans Pit, Twechar, appellants, in respect of an accident arising out of and in the course of his employment with the appellants. Previous to the arbitration the appellants had offered the respondent the sum of 15s. a-week, and they repeated that offer at the debate in the arbitration proceedings. No formal tender was lodged in process. The respondent did not accept the offer.

The Sheriff-Substitute ( Menzies) awarded compensation at the rate of 15s. a-week, and found no expenses due to or by either party. At the request of the appellants he stated a Case for appeal.

The Case stated—“1. On 21st March 1918 the workman, while in the employment of the defenders as a coal miner, was injured by a fall of coal upon his right leg. The accident arose out of and in the course of his said employment. 2. As a result of the accident he sustained a fracture of the upper third of the right tibia. 3. Till 4th March 1919 the employers paid him compensation at the rate of 25s. per week in respect of total incapacity. He was then and is now offered a reduced rate of compensation of 15s. per week as from that date in respect of partial incapacity. 4. The injury has resulted in a permanent outward convexity of the right tibia, causing the workman to walk upon the outer side of the right foot with a slight permanent limp. He has perfectly free movement of the knee and ankle. 5. The leg is permanently weakened and incapable of standing the same strain as a sound leg. 6. He is now, and has been since 4th March 1919, able to do any kind of light work that does not require great nimbleness of feet or excessive strain on his right leg. No work has since that date been offered to him by the employers. He was not an ‘odd lot’ in the labour market. 7. Since 4th July 1919 he has been engaged as a pedlar on his own account, carrying a substantial pack holding his wares, walking several miles a-day and climbing several stairs to his customers. 8. Before starting peddling he had never been employed in any other work than mining. 9. He is capable ( a) of work at the picking tables, the wages paid for this work being £2, 17s. 3d. per week; ( b) of work as a screeman, the wages for this work being about £3, 18s. 3d. per week; and ( c) work as a pit bottomer on the night shift, the wages paid for this work being about £4, 8s. per week. 10. His wages at the time of the accident were £3, 18s. per week, and would at present be about £5 if he had not been injured.

I found in law that the respondent was entitled to compensation from 4th March 1919 in respect of partial incapacity. I awarded him 15s. per week as compensation from 4th March 1919. I found no expenses due by or to either party.”

The questions of law for the opinion of the Court are—1. On the foregoing facts was I entitled to find no expenses due to or by either party? 2. On the foregoing facts was I bound to award expenses to the appellants?”

The arbitrator's note included the following passage—“Now it is agreed that his wages at the time of the accident were £3, 18s. per week. Under section 3 of the 1st Schedule to the Workmen's Compensation Act he cannot as a partially incapacitated man receive more than the difference between this £3, 18s., and ‘the average weekly amount which he is earning or is able to earn in some suitable employment after the accident.’ He was offered on 4th March 1919 by the employers 15s. per week, and at the hearing before me this offer was formally repeated by the employers' agent as a factor in the case. Therefore unless his wage earning capacity is found to be less than £3, 3s. per week he cannot obtain any higher rate of compensation than that of the 15s. per week offered to him, as a higher rate would be more than the difference between his wages of £3, 18s. and this figure of £3, 3s. What his actual earnings as a pedlar are I am unable from the nature of the evidence before me to give any finding upon, and this consideration must be put aside. But as I have reached the conclusion that he is capable of the work of a pit bottomer on the night shift, the employers are entitled to the benefit of that conclusion in a finding of the wage earning capacity equal to the wages paid for that work, viz., £4, 8s. That being so any question of his being entitled to more than 15s. per week offered by the employers does not arise. Even had I found him capable of nothing more than the lower paid job of screeman with its £3, 15s. 3d., no question could have arisen in view of the employers’ offer. As to expenses there is no such formal tender of this 15s. per week on record as would justify my giving expenses against the workman, but the workman has not recovered more than what was originally offered to him, and this precludes my giving him expenses against the employers.”

Argued for the appellants—In proceedings under the Workmen's Compensation Act parties were expected to reach agreement if at all possible, and litigation should be avoided. Here the appellants had made an offer of the sum ultimately awarded, and the sole cause of the litigation was the respondent's refusal of that offer. The expenses of the proceedings should fall on the respondent who had caused them— Mikuta v. William Baird & Company, 1916 S.C. 194, per Lord President Strathclyde at p. 197, 53 S.L.R. 160 at p. 161; Fife Coal Company v. Feeney, 1918 S.C. 197, 55 S.L.R. 223; Farme Coal Company v. Murphy, 1918 S.C. 659, per Lord Justice-Clerk Scott-Dickson at p. 661, 55 S.L.R. 557 at p. 559.

Page: 613↓

Argued for the respondent—The arbitrator had applied his mind to the question of expenses, and had not acted harshly. It was a matter of discretion, and where the arbitrator had considered the point and had exercised his discretion reasonably the Court would not interfere— Faime Coal Company v. Murphy, cit., per Lord Salvesen. The offer could have been put in a formal tender, but that not having been done the respondent was entitled to consider it as withdrawn, and in any event by the ordinary rules of tender he could not be found liable in expenses for failure to accept such an informal offer. Farme Coal Company v. Murphy was distinguishable, as there the sum offered was higher than the sum ultimately awarded.