Rahimi v Pamir Tiling Services Pty Ltd

[2023] ACTSC 201

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:

Rahimi v Pamir Tiling Services Pty Ltd

Citation: 

[2023] ACTSC 201

Hearing Date: 

7 July 2023, 10 July 2023

Decision Date: 

24 July 2023

Reasons Date:

28 July 2023

Before:

Baker J

Decision: 

See [25]

Catchwords: 

CIVIL LAW – consent judgment entered – personal injury – workers compensation – first defendant held insurance policy – insurer declined to indemnify defendant – Workers Compensation Default Insurance Fund Manager joined as second defendant to proceedings

Legislation Cited: 

Court Procedures Rules 2006 (ACT) rr 1611, 1612

Workers Compensation Act 1951 (ACT) ss 147A, 166, 166A, 172A

Parties: 

Ali Rahimi ( Plaintiff)

Pamir Tiling Services Pty Ltd ( First Defendant)

Workers Compensation Default Insurance Fund Manager (Second Defendant)

Representation:

Solicitors

Slater and Gordon Lawyers ( Plaintiff)

Sparke Helmore (Second Defendant)

File Number:

SC 263 of 2021

BAKER J:      

1․On 30 June 2021, the plaintiff filed an Originating Claim and Statement of Claim in this Court seeking damages, interest, and costs for injuries that he alleges he incurred on or about 17 July 2018, during the course of his employment with the first defendant and caused by the negligence of the first defendant.

2․At the time the plaintiff sustained the alleged injuries, the first defendant held a statutory workers compensation insurance policy with AAI Limited, trading as GIO as required under s 147A(2) of the Workers Compensation Act 1951 (ACT) (“WC Act”).

3․On 26 October 2021, the first defendant’s legal representative filed a notice of ceasing to act on behalf. The first defendant has not been legally represented in these proceedings since that time. It has never filed a Notice of Intention to Respond, nor a Defence in this matter.

4․In early 2022, GIO declined to indemnify the first defendant for any liability to pay damages for any injury that was suffered by the plaintiff that arose in the course of his employment with the first defendant on 17 July 2018.

5․On 4 May 2022, an Application in Proceedings was filed for the Workers Compensation Default Insurance Fund (“DIF”) Manager to be joined as second defendant to these proceedings. On 27 May 2022 this Court granted leave to the manager of the DIF to be joined as a second defendant to proceedings.

6․The DIF is established by s 166(1) of the WC Act. The DIF’s functions include:

… [meeting] the cost of an employer’s liability that arises independently of this Act in relation to an injury to, or the death of, a territory worker of the employer by indemnifying the employer only if, the employer has compulsory insurance policy to cover the liability but the policy was issued by a licensed insurer that cannot provide the indemnity required to be provided under the policy”: s 166A(5)(a)(i) of the WC Act.

7․In relation to the DIF manager’s power to act in ways which affect an employer, s 172A relevantly provides:

(1)This section applies if the DI fund manager conducts the defence of a proceeding against an employer for—

(a)a claim for compensation under this Act; or

(b)liability independent of this Act in relation to an injury to, or the death of, a territory worker of the employer.

(2)The DI fund manager may, without the employer’s agreement—

(a)   make a decision affecting the interests of the employer in the proceeding; or

(b)   consent to judgment against the employer in the proceeding.

(3)However, the DI fund manager must—

(a)   tell the employer about the manager’s intention to act under subsection (2) (a) or (b); and

(b)take into account the views (if any) of the employer.

8․It is therefore open to the DIF manager to consent to judgment against an employer under s 172A(2), even over the objection of the employer, provided the DIF manager “takes into account” the views (if any) of the employer: s 172A(3)(b) of the WC Act.

9․On 31 January 2023 parties attended court ordered mediation at the ACT Supreme Court. As a result of mediation, the matter settled by consent of the plaintiff and second defendant in favour of the plaintiff against the first defendant, for $111,000 inclusive of $16,000 in payments already made to the plaintiff in addition to costs to be agreed or assessed. On 17 May 2023, the plaintiff settled his claim for costs in the sum of $50,000 all-inclusive.

10․On 7 June 2023, the second defendant filed an application seeking orders under rules 1611 and 1612 of the Court Procedures Rules 2006 (ACT) that the Court enter a consent judgment. The terms of that proposed consent judgment accord with the agreements reached at mediation.

11․This application came before me in the Civil Applications in Proceeding List on 7 July 2023. Ms Covell, the legal representative for the second defendant, mentioned the appearance of the plaintiff. There was no appearance for the first defendant.

12․At that listing before me, Ms Covell read an affidavit of Ms Feletti affirmed 7 June 2023. That affidavit set out the background to the proceedings. The affidavit also annexed copies of various correspondence which the second defendant had sent to Mr Qasemi (the director of the first defendant). That correspondence, inter alia, advised the first defendant of the action which the DIF manager is permitted to take under s 172A of the WC Act and advised of the listing of the matter for mediation. In her affidavit, Ms Feletti stated that during the course of the mediation on 31 January 2023, she telephoned Mr Qasemi and informed him that the DIF was “present at the mediation and intended to attempt to resolve the matter pursuant to s 172A of the WC Act”.

13․As outlined above, before the second defendant may consent to judgment against an employer in proceedings under s 172A(2)(b) of the WC Act, the second defendant must “tell the employer about the manager’s intention to act under subsection 2(a) or (2)(b)”.

14․I was concerned that whilst the evidence demonstrated that the second defendant had told the employer of its intent to make decisions affecting the employer’s interests (for example, its intent to intervene in the proceedings, to attend the mediation and to “attempt to resolve the proceedings”), the evidence did not demonstrate that the second defendant had told the employer about its intention to consent to judgment against the employer (that is, to act under s 172A(2)(b) of the WC Act).

15․For this reason, I adjourned the matter to 10 July 2023 to allow the second defendant time to provide further evidence concerning its communications with the first defendant to date and/or to advise the first defendant of the terms of the proposed consent judgment.

16․On 10 July 2023, Ms Covell appeared on behalf the second defendant and mentioned the appearance of plaintiff. At that hearing, Ms Covell read a further affidavit of Maxine Feletti affirmed 20 July 2023. In that affidavit, Ms Feletti outlined further communications and annexed further correspondence between the second defendant and the first defendant concerning interactions between the second defendant and the first defendant at mediation on 31 January 2023 and subsequent to that time.

17․In particular, the affidavit indicated that on 31 January 2023, the plaintiff and the second defendant, who were both legally represented, attended court ordered mediation. There was no appearance by the first defendant. During the mediation, Ms Feletti contacted Mr Qasemi by telephone and informed him that:

(i)the DIF was present at the mediation and intended to attempt to resolve the matter pursuant to s 172A of the WC Act;

(ii)the plaintiff had made an offer of settlement and the DIF intended to respond;

(iii)the DIF “wanted to call and give him the opportunity to have a say”;

(iv)“any amount the DIF had to pay to the plaintiff in settlement of the claim in relation to liability of the first defendant may become a debt owing to the DIF, triple the amount of the payment”; and

(v)“it is important that you understand and let me know your view including the amount to pay.”

18․The affidavit does not record Mr Qasemi as having responded to this information.

19․The affidavit further indicated that Ms Feletti contacted Mr Qasemi via telephone a second time during the mediation and notified him that the plaintiff had made a further offer of settlement, and the DIF intended to make a final offer of $111,000 inclusive of $16,000 in payments already made to the plaintiff and plus costs to be agreed or assessed, which it considered reasonable on the information and evidence that it had.

20․I understand from Ms Feletti’s affidavit that Mr Qasemi did not provide Ms Feletti with any views as to the settlement that was proposed on behalf of the first defendant.

21․The affidavit states that settlement occurred on 31 January 2023. Following settlement, Ms Feletti contacted Mr Qasemi via email to advise of the outcome of settlement informing him of the terms of the settlement. The affidavit recorded that the second defendant received no response from Mr Qasemi. As at 20 July 2023, the date Ms Feletti’s affidavit was affirmed, the second defendant had received no further communication from the first defendant.

22․The affidavit also annexed a copy of an email which the second defendant sent the first defendant on 19 July 2023, which attached a copy of the application for the consent judgment, the affidavit of Ms Feletti dated 7 June 2023 and the proposed consent judgment.

23․Upon receipt of this further evidence, I was satisfied that the second defendant had told the first defendant of its intention to consent to judgment against it and, noting the first defendant’s apparent lack of response and/or views expressed on the matter, had “taken into account the views (if any) of the first defendant”. In these circumstances, I was satisfied that the second defendant was authorised to consent to judgment against the first defendant under s 172A of the WC Act.

24․Accordingly, pursuant to rules 1611 and 1612 of the Court Procedures Rules, I ordered that the Court enter a consent judgment in favour of the plaintiff against the first defendant for $111,000 inclusive of payments made to the plaintiff for and on behalf of the first defendant in the sum of $16,000, and that the first defendant pay the plaintiff’s costs and disbursements in the amount of $50,000 as agreed.

Orders

25․For the above reasons, I made the following orders with the consent of the plaintiff and the second defendant (the latter of whom is authorised by s 172A of the WC Act to consent to judgment against the first defendant):

(1)Judgment be entered for the plaintiff against the first defendant for $111,000 inclusive of payments made to the plaintiff for and on behalf of the first defendant in the sum of $16,000 (Judgment Sum).

(2)The first defendant pay the plaintiff’s costs and disbursements in the amount of $50,000 as agreed.

(3)Judgment be entered for the second defendant against the plaintiff.

(4)The first defendant will be at liberty to deduct and pay out of the Judgment Sum any other money repayable by the plaintiff to any person or body, whether for social services or otherwise, concerning which any demand or notice has been served on or given to the first defendant or its solicitor or the first defendant’s insurer or its solicitor.

(5)The plaintiff undertakes and agrees to pay out of the Judgment Sum any money repayable by the plaintiff to any person or body whether in respect of social services or otherwise which may not have been paid by the first defendant and also pay to the parties entitled all outstanding medical, hospital, ambulance and other out-of-pocket expenses.

(6)No interest will be payable in respect of the Judgment Sum if the Judgment Sum is paid within 28 days from the date of Judgment, or within 28 days after receipt by the first defendant of a notice from the Managing Director of Medicare Australia under ss 24 or 25 of the Health and Other Services (Compensation) Act 1995 or within 28 days of receipt of a notice under ss 1177, 1179 or 1182 of the Social Security Act 1991 or within 28 days of receipt of an Authority to receive satisfactory to the first defendant, whichever is the later.

(7)Subject to paragraph 5, no interest will be payable in respect of the Judgment Sum if paid to the plaintiff within 28 days from the judgment, nor on the costs if paid within 28 days of the date of agreement as to the amount.

I certify that the preceding twenty-five [25] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice Baker

Associate: A McCook

Date: 28 July 2023