Hartley v Workers Compensation Nominal Insurer (iCare) & Ors

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Hartley v Workers Compensation Nominal Insurer (iCare) & Ors [2024] NSWPIC 175
APPLICANT:	Stafford Keith Hartley
FIRST RESPONDENT:	AP & MT Mavin trading as Allan Mavin Carpark Service Station
SECOND RESPONDENT:	Workers Compensation Nominal Insurer (iCare)
MEMBER:	Cameron Burge
DATE OF DECISION:	9 April 2024
CATCHWORDS:	WORKERS COMPENSATION - Workplace Injury Management and Workers Compensation Act 1998; claim for permanent impairment compensation and hearing aids in relation to industrial deafness; fact of injury not disputed; applicant brings proceedings against nominal insurer and employer; onus is on the applicant to show employer was uninsured at deemed date of injury (in this instance 1 January 1980); employer leads uncontested evidence that it had insurance at relevant time, but owing to effluxion of time, the identity of the insurer is unknown; applicant’s solicitor undertook searches with some of the 62 insurers who provided cover at the relevant time to no avail; the claim was disputed by both respondents on the basis it was made out of time per section 261; the applicant alleged he was ignorant of his rights to make a claim until receipt of an IME report shortly before the making of the claim; however, the evidence demonstrated he had twice consulted with a solicitor as long ago as 2017 and was informed at that time he could make a claim provided he presented the solicitor with evidence of employment; no explanation was provided for the delay between the provision of that advice and the making of the claim in or about 2019; Held – the applicant has not discharged the onus of proving the first respondent was uninsured at the deemed date of injury; award for the second respondent; the applicant had knowledge of his rights to bring a claim in 2017 but did not do so until 2019; the claim was therefore made out of time against both respondents; award for the second respondent.
DETERMINATIONS MADE:	The Commission determines: 1. The applicant suffered an injury in the nature of hearing loss in the course of his employment with the first respondent with a deemed date of injury of 1 January 1980. 2. Award for the first respondent. 3. Award for the second respondent.

STATEMENT OF REASONS

BACKGROUND TO THE APPLICATION TO APPEAL

The applicant, Stafford Keith Hartley brings proceedings seeking payment of permanent impairment compensation and the provision of hearing aids as a result of industrial deafness suffered in the course of his employment with the first respondent, AP & MT Mavin. The second respondent, the Workers Compensation Nominal Insurer has been joined to the proceedings as the applicant alleges the first respondents were uninsured at the deemed date of injury, namely 1 January 1980.
The fact of the applicant’s injury is not in dispute. The first respondent relies on the submissions of the second respondent, which denies liability on the basis of non-compliance with s 261of the Workplace Injury Management and Workers Compensation Act1998 (the 1998 Act) and on the basis the applicant has failed to establish an entitlement to funds held by the second respondent, pursuant to s 140 of the Workers Compensation Act 1987 (the 1987 Act).

ISSUES FOR DETERMINATION

The parties agree that the following issues remain in dispute:
(a) whether the applicant has established that the first respondent was not insured at the relevant time, and
(b) whether the applicant is precluded from bringing a claim by virtue of the operation of s 261 of the 1998 Act.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.
The parties attended a hearing on 22 February 2024. At the hearing, the applicant was represented by Mr Hallion of counsel instructed by Mr Bechelli. The first respondent was represented by Mr Malouf of counsel instructed by Mr Stubbs. The second respondent was represented by Mr Anderson, solicitor.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Personal Injury Commission (Commission) and considered in making this determination:
(a)    Application to Resolve a Dispute (the Application) and attached documents;
(b)    Reply and attached documents, and
(c)    second respondent’s Application to Admit Late Documents (AALD) and attachments.

Oral evidence

There was no oral evidence called at the hearing.

FINDINGS AND REASONS

Whether the first respondent was uninsured

The applicant seeks a declaration that the first respondent was not insured as required at the time of the worker’s injury and that the second respondent pay any compensation and costs awarded against the first respondent from the workers compensation insurance fund. Additionally, the applicant seeks an order that the first respondent reimburse the second respondent for amounts paid out of the workers compensation insurance fund in respect of compensation and costs awarded against it.
A worker may bring a claim against a nominal insurer in the circumstances set out in s 140 of the 1987 Act. That section relevantly provides:
“(1) A claim under this Division may be made against the nominal insurer by any person who considers he or she has a claim against an employer for compensation under this Act, or work injury damages in respect of an injury to a worker, if –
(a)the employer is uninsured, or
(b)the person claiming the compensation has been unable, after due search and enquiry, to identify the relevant employer.
(2) An employer is considered to be ‘uninsured’ if the employer –
(a)had not obtained, or was not maintaining in force, a policy of insurance for the full amount of the employer’s liability under this Act in respect of the injured worker at the relevant time…”
The applicant has the onus of demonstrating the first respondent was uninsured at the time of his injury. The applicant made a claim on the second respondent via his solicitors on
27 March 2019, at which time he enclosed copies of certain documentation including ASIC searches, his 1977 group certificate and letters to various insurers.
Attached to the second respondent’s Reply is a statement of the applicant’s solicitor, Mr Bechelli sworn in Workers Compensation Commission proceedings number 5689/2020 and dated 23 October 2020. That document annexes a table of licenced workers compensation insurers as at 30 June 1979, being nearly six months before the deemed date of injury. It reveals there were 62 insurers licenced as at 30 June 1980, being six months after the date of injury.
The applicant’s solicitor made enquiries with 10 of those insurers and received replies from six of them. It follows that some 50 or so insurers did not have enquiries made of them by the applicant’s solicitor. I do not say that as a criticism of the applicant’s solicitor, noting that a number of the insurers were industry or company-specific. Nevertheless, the applicant’s solicitor’s admirable act served to demonstrate the difficulty of attempting to deal with long-tail cases such as the present matter in terms of demonstrating insurance coverage or otherwise.
The difficulty for the applicant, however, is that he bears the onus of proving lack of insurance. Mr Hallion took the Commission to a decision in WorkCover Authority of New South Wales v Sadler [2009] NSWWCCPD 127 (Sadler), in which the Commission found a hospital uninsured as a result of enquiries failing to reveal the presence of relevant workers compensation coverage. The Commission held in that case there had been no policy sufficient to satisfy s 140 of the 1987 Act. Mr Hallion submitted that although the applicant carries the overall onus of proving lack of insurance, in certain circumstances the evidentiary onus would fall on the respondent in a dispute such as this as it is in a position to provide evidence of insurance coverage whereas the applicant is not.
That submission was met by Mr Malouf, who noted the first respondent did provide evidence in this matter, namely a statutory declaration of Max Mavin sworn on 12 April 2019. Mr Mavin, the financial controller of the respondent’s incorporated successor, accepted in that document the applicant was employed by the respondents on a permanent basis as a truck driver.
Mr Mavin also deposed to the first respondents having had a policy of insurance for workers compensation at the deemed date of injury, namely 1 January 1980. In response to the question “if the employer did have a policy of insurance for workers’ compensation as at the claimed date of injury what was the policy number?”, Mr Mavin deposed “no record. Too far back.” In answer to questions concerning the expiry date of any workers’ compensation policy, the estimated gross wages for all employees at the time of the injury, Mr Mavin also indicated there were no records owing to the effluxion of time.
Additionally, Mrs Marie Maven provided a statement of evidence which is attached to the second respondent’s reply.
In her statement, Mrs Mavin noted she and her husband Alan established the first respondent’s business and ran it as a partnership until 1982 when the business was incorporated. Mrs Mavin noted that her husband has died and deposed to the following circumstances:
“6     My role in the partnership was mostly nominal in that I was not engaged day to day with the operation of the business nor was I involved in the financial management. I assisted with a variety of duties of a less physical supportive nature as and when required. I had little knowledge of and minimal participation in the financial affairs of the business for the reasons set out below.
7.     Notwithstanding my limited role in the business management I was firmly of the understanding all activities of the partnership were fully insured because of the volatile nature of the product we dealt with and the inherent risk to property and person. I was also acutely aware that any business failure or accident could result in the loss of our family home in which my husband and I were raising our three young children.
8.     Max Mavin (Max) my husband’s brother was employed at the time we acquired the business in an accountancy practice in Kempsey known as SR Paine & Co. Both Max and Alan to the best of my knowledge and belief set up all necessary taxation, insurance and financial structures for the business.
9.     I was not involved in the selection of insurances for workers’ compensation, public liability and other forms of insurance so I am unaware of the workers’ compensation insurer for our partnership between 1970 and 1980.
10.    I have caused enquiries and searches to be made of persons and entities associated with the conduct of the partnership business and subsequent corporate business but because of the effluxion of time no records would appear to be in existence and no information is available to identify the workers’ compensation insurer for the relevant period.”
Max Maven’s statement included the following evidence:
“5.     At the time of their acquisition of the business I was working in an accountancy practice in Kempsey named SR Paine & Co. In the course of my duties at the accountancy practice I set up the structure for the business conducted in partnership by my brother and his wife.
6.     As part of the setup for the business I am certain all necessary insurances inclusive of workers compensation, public liability and property damage were put in place and have remained current to this day.
7.     I cannot recall whether insurances were obtained through a local AMP broker, Keith Halpin who was a good friend of my brother or whether insurance through GIO was obtained as that company carried the insurance for the Ampol service station in Belgrave Street, Kempsey which was taken over by the business on acquiring the Ampol distributorship.
8.     Exhaustive enquiries of AMP and GIO have been undertaken but due to the effluxion of time no records can be found.
9.     I am currently the financial controller of the corporate business AP & MT Mavin (Petroleum) Pty Ltd and I have assisted with the financial management of the partnership and corporate Mavin businesses since their inception. I have always placed insurance protection as a priority and ensured premiums were paid when due and the level of protection was constantly reviewed. I have no doubt workers compensation insurance was in place when the partnership of AP & MT Mavin commenced and was maintained throughout its duration.”
For the second respondent, Mr Malouf submitted the decision in Sadler was distinguishable, because there is positive evidence put forward by the first respondent in the current matter that it was in fact insured for workers compensation purposes as at the deemed date of injury.
It is trite to say that the only relevant basis for recovery from the nominal insurer is where an injured worker establishes a lack of insurance coverage on the part of an employer or when the identity of the employer is not ascertainable. The Act does not provide for the nominal insurer to provide coverage where the identity of an employer’s insurer is not ascertainable. To say this is an unfortunate gap in the coverage offered by the workers compensation legislation in this State is an understatement, however, it is a gap into which, unfortunately, the applicant falls in circumstances where the defect in the scheme can only be remedied by Parliament, rather than a Member of the Commission.
Quite appropriately, no attack was sought to be made on the credibility of the first respondents or the statement evidence which was presented on their behalf. The applicant has the onus of proving lack of insurance cover by the first respondent. Notwithstanding the noble attempts by his solicitor to ascertain whether policies of insurance were held with certain insurers, those enquiries were self-evidently limited in scope, through no fault of the person making them.
No criticism, in my view, can be levelled at the applicant’s solicitor for their efforts in trying to enquire of relevant insurers as to whether a policy of insurance existed. However, the lack of substantive response from those insurers, together with the sheer number of other providers who did not have enquiries made of them combined with the positive evidence of Mrs Mavin and Mr Max Mavin as to the existence of an insurance policy at all times since the commencement of the first respondents’ business means the applicant has not discharged his onus of establishing that the first respondent was uninsured.
Accordingly, the applicant’s claim against the second respondent must fail, and there will be an award in favour of the workers compensation nominal insurer against the applicant.

The Limitation Defence

The respondents also rely on s 261 of the 1998 Act in denying liability.
That section provides compensation cannot be recovered unless a claim for the compensation has been made within six months after the injury or accident happened. The section also provides a number of circumstances in which failure to make a claim within the period required under s 261 is not a bar to the recovery of compensation. Those circumstances are well known, and I do not propose to set them out in full in these reasons.
For the applicant, Mr Hallion correctly noted the insidious nature of industrial deafness as a condition whose development does not become apparent until many years after the actual injury-inducing event. There can be no question that this is the case. Mr Hallion took the Commission to a number of decisions by various Appellate Courts and also Presidential Members of this Commission and its predecessors regarding the ignorance of injured workers in relation not only to hearing loss claims, but generally.
I accept Mr Hallion’s submission that it was impossible for the applicant to know at the deemed date of injury in 1980 that he had even suffered an injury. However, this is not the end of the matter. There is no question the applicant first made a claim on the nominal insurer on 27 March 2019. The applicant submits that s 261 of the 1998 Act does not apply in this matter, as he could not know he had industrial hearing loss until such time as he received a report from his independent medical examiner, Dr MacArthur, which was dated
20 February 2019.
For the respondent, Mr Malouf submitted that in fact the applicant knew he had hearing loss attributable to his employment as early as July 2017. At page 29 of the Application is a file note from the applicant’s solicitors dated 5 July 2017. Relevantly, that file note states:
“Industrial deafness claim
Subject: discussions with client
Spoke to client as arranged at the iHear Port Macquarie Clinic 30/6/2017.
The purpose of this was to go through the hearing test results of 26 May 2017 noting that they incorrectly put on his hearing test Wauchope instead of West Kempsey NSW 2440 which we will get fixed later on. The client advised he has had no prior claims. He was last self-employed as a sole trader between March 1980 and 2000 – plastering. Prior to that he worked for Ampol or Caltex, that was his last employer, through Alan Mavin as a truck driver from 1970 through to 1980. I advised him that we cannot do anything for him unless he can prove employment which we will arrange one further phone conference, giving him time to do that. Then we will look at making a claim for him for both lump sum compensation and hearing aids and that is why we are not going to open a file until we have that information. I spoke to the client generally noting the initial attendance.”
A further file note dated 24 January 2018 is also annexed at page 30 of the Application. It relevantly reads as follows:
“Spoke to client as arranged at the iHear Port Macquarie Clinic on 25/9/2017.
The purpose was to go through the hearing test results of 26 May 2017.
The client advised that he has had no prior claims. He was a self-employed sole trader from 1983 to 2000. Prior to that he worked for Ampol/Caltex from 1970 to 1980. He will need to chase up employment documents so we will stand over for a further phone conference – next available to see whether that has come in.”
The applicant then attended on Dr MacArthur on 18 February 2019, and a claim relying on Dr MacArthur’s report dated 20 February 2019 was then served on the uninsured claims department of the second respondent on 27 March 2019.
No explanation is provided in the applicant’s documentation as to why there was a delay between his obtaining hearing test results in 2017 and the making of the claim in 2019. In a supplementary statement dated 20 December 2022, the applicant said:
“I was not aware that I suffered any hearing loss caused by my employment until my solicitors obtained the report of Dr Peter C MacArthur dated 20 February 2019 which provided to me by letter dated 27 February 2019 in which I received shortly thereafter.
Prior to that time, I had attended on an audiologist at iHear Port Macquarie on 26 May 2017 and 23 August 2018 and the reason for that being that it was a free consultation and I had reason to believe that my hearing was not perfect. I was not however aware that any hearing deterioration from which I may have been suffering had been caused by my employment with AP & MT Mavin.
Apart from the consultation with the audiologist on 26 May 2017 and 23 August 2018 I have not had any consultation with any other audiologist, or general practitioners, ear nose and throat specialists or any other healthcare professionals in relation to my hearing.”

The applicant did not make a claim on the first respondent until 8 April 2022. It should, however, be noted that on 7 February 2022, the applicant’s solicitors wrote to the first respondent advising of the potential claim and requesting details concerning the policy of insurance. In my view, although that letter does not constitute a claim being made, for reasons which will become apparent, it does not matter whether the claim against the first respondent can be said to have been made either in February or April 2022.
As Mr Anderson for the first respondent noted, the key word in s 261 of the 1998 Act is “claim”.
That is, the giving of notice is not of itself sufficient to satisfy s 261. Rather, it is the making of a claim which is necessary to enliven the section.
Mr Anderson and Mr Malouf both submitted that the applicant was in fact aware of his hearing loss and the potential to make a claim as early as July 2017. In my view, that submission carries significant force. The applicant received legal advice to the effect that he had a potential claim against the first respondent, and all that was required was employment documentation to bring that claim against it. No explanation was provided by the applicant as to further delay between 2017 and 2019 when a claim was first made against the second respondent. Given that absence of explanation, in my view the applicant falls foul of s 261 of the 1998 Act as against the second respondent, which in any event because of the reasons in relation to the insurance issue, I have found is not a party liable to pay compensation in any event.
Having made those findings, the question then is whether the applicant has brought his claim within time against the first respondent. In my view, he has not. There is a requirement to notify an employer of a claim, not merely an insurer. Whilst s 261 provides that where two or more persons are liable or partly liable in respect of compensation a claim is for the purposes of the section taken to have been made when it is made on only one of those persons, in this instance the second respondent as nominal insurer is not liable in respect of compensation as I have found.
In any event, were the second respondent so liable, for the reasons which I have already stated, the claim against it was late. It follows in the circumstances of this matter that if the claim against the second respondent was made late then that against the first respondent must also be late. Whilst the applicant gives evidence that he was not aware that he could bring a claim until he received the report of Dr MacArthur, that plainly flies in the face of the file notes of his solicitors from 2017 and early 2018, each of which informed the applicant of his potential to make a claim subject to the provision of employment documentation. In other words, from at least July 2017 the applicant was aware not only that he had suffered hearing loss but that it was in the nature of industrial deafness and that he could make a claim for both hearing aids and for permanent impairment compensation.
In my view, no special circumstances are identified which would enliven the provisions of s 261(4) of the 1998 Act. This being so, in my view the applicant’s claim against the first respondent falls foul of s 261 of the 1998 Act and there will accordingly be an award for the first respondent as against the applicant in relation to this matter.

SUMMARY

For the above reasons, the Commission will make the findings and orders set out on page 1 of the Certificate of Determination.

[2024] NSWPIC 175

9 April 2024