Workers Compensation Nominal Insurer v Arab

District Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Workers Compensation Nominal Insurer v Arab [2024] NSWDC 523

Hearing dates:

6 November 2024

Date of orders:

6 November 2024

Decision date:

06 November 2024

Jurisdiction:

Civil

Before:

Abadee DCJ

Decision:

See paragraphs [69] and [72]

Catchwords:

CIVIL PROCEDURE – application to set aside default judgment – Workers’ Compensation Nominal Insurer claim against defendant as ‘culpable director’ of uninsured company – whether triable issue

Legislation Cited:

Civil Procedure Act 2005 (NSW), ss, 58(2), 63(3)

Uniform Civil Procedure Rules 2005 (NSW), rr, 36.15(1), 36.16(2)

Workers Compensation Act 1987 (NSW), ss 145, 145A

Workplace Injury Management and Workers Compensation Act 1998, s 105

Cases Cited:

Coombs v Workcover Authority of NSW [2014] NSWSC 1701

Dai v Zhu [2013] NSWCA 412

J & M McNamee Holdings Pty Ltd v Mungerie Vale Pty Ltd t/as Greenwood Group Realtors [2019] NSWCA 293

Jones v Riley [2022] NSWDC 323

Teofilo v State of New South Wales [2007] NSWSC 767

Violi v Commonwealth Bank of Australia [2015] NSWCA 152

Texts Cited:

Ritchie's Uniform Civil Procedure NSW

Category:

Procedural rulings

Parties:

Workers Compensation Nominal Insurer (Plaintiff/Respondent)
Mr Ali Arab (Defendant/Applicant)

Representation:

Counsel:
Mr D Price (Plaintiff/Respondent)
Mr Ali Arab (Defendant/Applicant)

Solicitors:
Turks Legal (Plaintiff/Respondent)
Ehsani Legal Pty Ltd (Defendant/Applicant)

File Number(s):

2024/00134304

Publication restriction:

Nil

EX Tempore reasons for JUDGMENT

Introduction

1. On 27 June 2024, default judgment was entered in favour of the plaintiff (the 'Nominal Insurer') against the defendant (‘Mr Arab’) for the sum of $255,731, inclusive of costs. By a notice of motion filed on 18 July 2024, Mr Arab applies to set aside that judgment, apparently pursuant to both rr 36.15(1) and 36.16(2)(a) of the Uniform Civil Procedure Rules 2005 (NSW) (‘UCPR’).

2. The Nominal Insurer had commenced the proceeding, by a statement of claim, on 11 April 2024. By its pleading, the Nominal Insurer relevantly averred that: Mr Arab was the director of Pila Pila Pty Ltd (the company) which, materially, employed a worker (Ms Sakhrawi); that the worker sustained a work injury in April 2021; that the company was uninsured and therefore contravened s 155(1) of the Workers Compensation Act 1987 (NSW) ('WC Act'). The Nominal Insurer contended that by force of statute, the worker was entitled to sue it and the Nominal Insurer, in turn paid the worker compensation and medical expenses and thereafter it was entitled to sue the company for reimbursement of the amount that it paid the worker. This represented a statutory debt. But, on 3 July 2023, the company was placed into liquidation. That eventuality was also covered by the statutory scheme in the sense that the Nominal Insurer was entitled to recover an amount representing the sum that the Nominal Insurer considered irrecoverable from the company from a 'culpable director'. That expression presented a low bar by the statutory scheme: it was sufficient that the person was a director of the company at any time during the contravention to which the entitlement to iCare related.…