CERTIFICATE OF DETERMINATION OF MEMBER  	
	
Citation:	FirmGuard Pty Ltd (in Liquidation) v Workers Compensation Nominal Insurer (iCare) [2023] NSWPIC 653	
		
APPLICANT:	Daniel Ussher	
		
RESPONDENT:	Workers Compensation Nominal Insurer	
		
Member:	Rachel Homan	
		
DATE OF DECISION:	6 December 2023	
		
CATCHWORDS:	WORKERS COMPENSATION - Miscellaneous application seeking orders that applicant not liable to reimburse amount specified in a section 145(1) notice; section 145(1) notice served on corporate employer; proceedings under section 145(3) not pursued by corporate employer; corporate employer now in liquidation and certificate served under section 145A on the applicant as a culpable director; whether the Commission has jurisdiction to make the orders sought; Raniere Nominees Pty Ltd v Daley considered; Held – a section 145(1) notice can only be served on employer or that employer’s insurer; only a person served with a notice under section 145(1) can apply to the Commission for a determination under section 145(3); the letter sent to the applicant serving a section 145A certificate was not a section 145(1) notice; section 145A provides no statutory power for the Commission to make the orders sought; section 145A establishes a pathway for the recovery of a statutory debt in a court of competent jurisdiction; miscellaneous application dismissed.
	
determinations made:	The Commission determines:
1.	The Commission lacks power to make the orders sought in the Miscellaneous Application.
2.	The proceedings are dismissed pursuant to s 54 of the Personal Injury Commission Act 2020.

STATEMENT OF REASONS
BACKGROUND
1.	Mr Daniel Ussher (the applicant) was a director of FirmGuard Pty Ltd (FirmGuard) which is now in liquidation.
2.	On 12 July 2022, Mr Andrew Tierney, made a claim for workers compensation benefits in respect of a psychological injury sustained in the course of or arising out of his employment with FirmGuard on 28 June 2022. As FirmGuard did not hold a current workers compensation insurance policy as at that date, the claim was made against the Workers Compensation Nominal Insurer (the respondent).
3.	On 19 September 2022, the respondent issued a notice to reimburse under s 145(1) of the Workers Compensation Act 1987 (the 1987 Act) to FirmGuard seeking reimbursement of payments made from the Workers Compensation Insurance Fund to or in respect of 
Mr Tierney.
4.	A further notice under s 145(1) of the 1987 Act was issued to FirmGuard on 
3 November 2022.
5.	On 23 November 2022, the respondent wrote to the applicant in his capacity as a former director of FirmGuard. The letter referred to the acceptance of the claim for compensation made by Mr Tierney and the service of a s 145 notice to the company’s registered address. It was noted that FirmGuard was in liquidation and unable to pay its debts. The letter stated:
“The Nominal Insurer has determined that you are a culpable director of Firmguard Pty Ltd within the meaning of Section 145A of the Act and is therefore seeking reimbursement from you.”
6.	Attached to the letter was a Certificate under s 145A(3) of the 1987 Act, which stated:
“Firmguard Pty Ltd is liable to reimburse the Workers Compensation Insurance Fund an amount of $38,468.97 for payments made in respect of a claim under Division 6 of Part 4 of the Workers Compensation Act 1987. 
Insurance and Care NSW, for and on behalf of the Workers Compensation Nominal Insurer, HEREBY CERTIFIES, in relation to the Workers Compensation Insurance Fund, it will be unable or unlikely to recover the amount of $38,468.97 from Firmguard Pty Ltd by reasonable efforts at recovery, because the corporation is being wound up and is unable to pay its debts, or otherwise.”
7.	On 21 February 2023, a letter with the subject, “Final Demand”, was sent to the applicant, stating:
“I write further to the Culpable Director Notice dated 23/11/2022. 
To date we have not received payment from you. You are now advised that failure to remit full payment or agree to an acceptable instalment arrangement on or before close of business 28/2/2023, we will have no further recourse than to forward the file to our legal service providers to commence immediate application for judgment and no further correspondence will be entered into.”
8.	A third notice to reimburse under s 145(1) of the 1987 Act was issued to FirmGuard on 
3 March 2023.
9.	On 16 August 2023, the respondent again wrote to the applicant in his capacity as a former director of FirmGuard. The letter, which was expressed in almost identical terms to that dated 23 November 2022, referred to the third s 145(1) notice and indicated that as the company was in liquidation and unable to pay its debts the respondent was seeking reimbursement from the applicant as a culpable director within the meaning of s 145A of the 1987 Act. Another Certificate under s 145A(3) of the 1987 Act was attached to the letter, as was the     s 145(1) notice dated 3 March 2023.
10.	On 15 September 2023, the applicant’s legal representative, Mr Macken, lodged a Miscellaneous Application in the Personal Injury Commission (Commission) seeking orders that the amount specified in the notice issued under s 145 of the 1987 Act was not recoverable.  Attached to the Miscellaneous Application was the correspondence addressed to the applicant dated 16 August 2023 and all of its annexures.
11.	The matter proceeded to a preliminary conference on 18 October 2023. On that occasion the Miscellaneous Application was amended to identify the applicant instead of FirmGuard as the applicant in the proceedings.
12.	Noting that the proceedings appeared to have been brought in respect of a notice issued to the applicant as a culpable director under s 145A of the 1987 Act and not in respect of a notice issued under s 145(1) of the 1987 Act, I queried whether the Commission had jurisdiction to deal with the matter.
13.	Mr Macken, submitted that the correspondence to the applicant dated 16 August 2023 could be regarded as a notice under s 145(1) of the 1987 Act. Mr Macken submitted that he required additional time to gather and serve documents on the respondent.  As the matter was potentially time-limited under s 145 and not yet ready to proceed, it was agreed that a further preliminary conference should be convened. 
14.	A direction was made to the parties to be prepared to make oral submission on the jurisdictional question at the further preliminary conference.
15.	The parties appeared for further preliminary conference on 13 November 2023. The parties were unable to reach an agreed resolution of the dispute and I determined that the jurisdictional question ought to be determined prior to any referral for conciliation conference and arbitration hearing.
16.	Oral submissions were made and recorded by Mr Macken on behalf of the applicant and 
Ms Browne on behalf of the respondent. I reserved my decision and indicated that a written Certificate of Determination and statement of reasons would be issued.
ISSUE FOR DETERMINATION
17.	The parties agree that the following issue remains in dispute:
(a)	whether the Commission has jurisdiction in respect of the Miscellaneous Application.
EVIDENCE
Documentary evidence
18.	The following documents were in evidence before the Commission and considered in making this determination: 
(a)	Miscellaneous Application and attached document, and 
(b)	Reply and attached documents. 
Applicant’s submissions
19.	The applicant referred to the correspondence dated 16 August 2023 and submitted that it was plainly expressed as a s 145 notice, whether it was intended that way or not. The notice being expressed that way, the jurisdiction of the Commission was enlivened.
20.	The applicant submitted in the alternative that the Commission had a broad jurisdiction under s 105 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) in relation to all matters arising under the legislation.
21.	The applicant submitted that two substantive disputes had been placed in issue being the application of s 11A(1) of the 1987 Act to the claim made by Mr Tierney and the extent of any incapacity resulting from the alleged injury. Those matters were not yet the subject of determination and the Commission was the only forum with jurisdiction to determine those matters.
22.	The applicant submitted that where a demand was being made against a director on behalf of a company, where the company was in liquidation, the director ought not be deprived of the rights the company would have had. Although the notice was sent to a director and not the company, the right the company would have had to dispute liability must vest in the director to whom notification was issued. The Commission was vested with jurisdiction under s 145 of the 1987 Act.
23.	The applicant was a person served with a notice under s 145A and was entitled to apply for a determination in the same way as the company was. Accordingly, the applicant submitted that the Commission was seised of jurisdiction to deal with the matter.
Respondent’s submissions
24.	The respondent submitted that a notice was issued under s 145(1) of the 1987 Act to FirmGuard on 3 March 2023. That notice was the subject of prior proceedings, commenced in time, in the Commission. Prior to a determination those proceedings, they were discontinued. In the respondent’s view, this confirmed the company’s liability to reimburse the respondent.
25.	The respondent submitted that annexed to the notice attached to the Miscellaneous Application was a s 145A(3) certification dated 16 August 2023 that the company was in liquidation and unable to pay its debts. Liability in respect of the s 145(1) notice had not been challenged. The s 145A certification simply enabled the respondent to recover the company’s debt from the applicant. 
26.	The respondent submitted that the company had the opportunity to challenge its liability. The time period for commencing proceedings in the Commission in respect of the s 145(1) notice had elapsed. The s 145A certification simply opened the pathway to commence debt recovery proceedings.
27.	On a plain reading, s 145 provided a clear pathway for the substantive issues raised by the applicant to be determined.  The absence of any equivalent wording in s 145A was telling. 
28.	The respondent submitted that there was not a single decision in which the Commission had heard a s 145A case. Proceedings in respect of a s 145A notice were usually heard in debt recovery proceedings in other jurisdictions such as the Local Court. There was a remedy for the applicant to be heard in those proceedings.
29.	In response to a question from the Commission, the respondent submitted that a s 145(1) notice could only be issued to an “employer”. FirmGuard and the applicant were separate legal entities. Only FirmGuard entered into an employment contract with Mr Tierney. There was no contract of service between the applicant and Mr Tierney.
Applicant in reply
30.	The applicant submitted that the s 145(1) proceedings were discontinued on instruction from the liquidator on the understanding that the s 145A notice would still entitle the applicant to challenge the matter.
31.	If the respondent’s reading of the sections was correct, wherever a company was in liquidation, administration or being wound up, there would be no entitlement on any person’s part to challenge a s 145 notice. This approach involved a reading down of the Commission’s jurisdiction in a way which was inappropriate. 
32.	The applicant submitted that the reference to an “employer” in s 145(1)(a) would encompass the applicant in circumstances where he was the sole director of the company and responsible for paying, managing and directing Mr Tierney. In every respect, the applicant was the “employer”, particularly where the company was now in liquidation and had ceased to exist.
FINDINGS AND REASONS 
33.	Section 155 of the 1987 Act requires employers to hold workers compensation insurance.
34.	Division 6 of Part 4 of the 1987 Act makes provision for claims for compensation to be made against the respondent if an injured worker’s employer is uninsured in contravention of s 155 of the 1987 Act. 
35.	Section 145 of the 1987 Act makes provision for the respondent to require an uninsured employer to reimburse the Insurance Fund amounts paid in respect of the injured worker. Subsection 145(1) provides:
“(1)  The Nominal Insurer may serve on a person who, in the opinion of the Nominal Insurer, was—
(a)  	in respect of an injured worker to or in respect of whom a payment has been made by the Nominal Insurer in respect of a claim under this Division, an employer at the relevant time, or
(b)  	an insurer under this Act of such an employer,
a notice requiring that person, within a period specified in the notice, to reimburse the Insurance Fund an amount (not being an amount exceeding the amount of the payment made) specified in the notice.”
36.	Subsections 145(3) and (4) provide for an application to be made to the Commission for determination of the employer’s liability in respect of the payment:
“(3)  	A person on whom a notice has been served under subsection (1) in respect of an injured worker may, within the period specified in the notice, apply to the Commission for a determination as to the person’s liability in respect of the payment concerned.
(4)  	The Commission may hear any such application and may—
(a)  	make such determination in relation to the application, and
(b)  	make such awards or orders as to the payment of compensation under this Act to or in respect of the injured worker concerned,
as the Commission thinks fit.”
37.	Failure to apply within the time specified in the notice will be fatal to such an application and the Commission has no jurisdiction to entertain the application or to grant an extension of time. In Raniere Nominees Pty Ltd v Daley [2006] NSWCA 235 (Raniere), an employer argued that the Commission had jurisdiction to determine its liability to reimburse the respondent under s 105(1) despite the requirements of s 145(3) not having been met. In rejecting this argument, Giles JA stated:
“The primary mechanism for reimbursement of the WorkCover Authority is the notice procedure under s 145, which by s 145(6) gives the WorkCover Authority a right to recover in a court of competent jurisdiction an amount specified in a notice served under s 145(1) where an application has not been made under s 145(3). Service of a notice leading to a right of action is intended to provide for expeditious and certain recovery of payments, and application within the period specified in the notice is part of the expedition and certainty.
19 Section 145(3) is clear in its terms, entitling the person on whom the notice had been served to apply within the period specified in the notice and as a corollary denying any such entitlement outside the period specified in the notice. Section 145(4) then confines the application which the Commission may hear and determine to an application so made, by the clear words “any such application”: the employer’s submission takes no account of the word “such”. The Commission’s power to determine the person’s liability in respect of the payments is enlivened only by the making of an application within the period specified in the notice.”
38.	Subsection 145(6) provides for the recovery of the amount specified in a notice pursuant to 
s 145(1), where no has been application made to the Commission for determination of the employer’s liability:
“(6)  	The Nominal Insurer may recover an amount specified in a notice served under subsection (1) (being a notice in respect of which an application has not been made under subsection (3)) from the person to whom the notice was given as a debt in a court of competent jurisdiction.”
39.	Section 145A provides that if a corporation is liable to reimburse the respondent an amount under s 145(1), the respondent is entitled to recover the amount from a culpable director in certain circumstances:
“145A   Recovery from directors of corporations liable to reimburse Insurance Fund
(1)  	If a corporation is liable to reimburse the Insurance Fund an amount for a payment made in respect of a claim under this Division and the amount is not recoverable from the corporation, the Nominal Insurer is entitled to recover the amount from a person who was a culpable director of the corporation at the relevant time.
(2)  	A corporation is considered to be liable to reimburse the Nominal Insurer an amount for such a payment if the Nominal Insurer is entitled to recover the amount either under section 145 or under an order of the Commission made on application under that section, even if the corporation has ceased to exist.
(3)  	An amount is considered to be not recoverable from a corporation if the Nominal Insurer certifies that it will be unable or unlikely to recover the amount from the corporation by reasonable efforts at recovery, whether because the corporation is being wound up and is unable to pay its debts, or otherwise.
(4)  	A person is a culpable director of a corporation at the relevant time if—
(a)  	the corporation contravened section 155 (Compulsory insurance for employers) in respect of a policy of insurance that would have covered the corporation for the liability to which the payment made in respect of the claim under this Division related (whether or not the corporation has been proceeded against or convicted of an offence for the contravention), and
(b)  	at the time of the contravention the person was a director of the corporation.
(5) 	A person is not a culpable director of a corporation if the person establishes that—
(a)  	the corporation contravened section 155 without the person’s knowledge, or
(b)  	the person was not in a position to influence the conduct of the corporation in relation to that contravention, or
(c)  	the person, being in such a position, used all due diligence to prevent the contravention by the corporation.
(6)  	If there is a right of recovery against more than one director of a corporation in respect of the same amount, the right is a right against all those directors jointly and severally.
(7)  	A director from whom an amount is recovered under this section is entitled to recover the amount from the corporation.”
40.	Section 105 of the 1998 Act gives the Commission exclusive jurisdiction to examine, hear and determine all matters arising under the 1998 Act and the 1987 Act, subject to the provisions of the 1998 Act. In Raniere, Santow JA commented on the nature of the Commission’s jurisdiction under s 105:
“Section 105 of the WIM Act sets out the jurisdiction of the Commission. Thus in acting judicially in its decision-making, the Commission is governed by statute. It does not possess an inherent jurisdiction but only such powers which are incidental and necessary to the exercise of its statutory jurisdiction; see DJL v Central Authority [2000] HCA 17; (2000) 201 CLR 226 at [24ff]. It has no statutory power expressly permitting it to extend the time for the employer to make application under s145(3). I do not consider that use of the word “may” in s145(3) does so impliedly; the section is an enabling one so that “may” in effect means “must”.
The statutory formulation in s145(3) here contains a factual reference to an objective fact. It is the making of an application to the Commission by the employer within the period specified in WorkCover’s s145(1) notice. Whether that has occurred is to be determined at the outset and not in course of a judicial decision-making process; compare Timbarra (supra) at [50]. It is only an application so made which enables the Commission to determine the employer’s liability in respect of the relevant payment.”
41.	Turning to the facts of this case, it is clear that a notice under s 145(1) was issued to FirmGuard on 3 March 2023. It is accepted by the parties that FirmGuard was Mr Tierney’s “employer”, although no evidence of the employment contract has been put before the Commission in these proceedings. There is no suggestion that the notice under s 145(1) was not a valid notice for the purposes of that provision.
42.	Subsection 145(3) provided for FirmGuard to apply to the Commission for a determination as to its liability in respect of the payment concerned within the period specified in the notice.  That period was 28 days from the date of service of the notice. It appears that FirmGuard made an application to the Commission within the period required by s 145(3). However, before a determination as to its liability was made, the proceedings were discontinued.
43.	Applying the authority in Raniere, there is no jurisdiction for the Commission to determine FirmGuard’s liability in an application made outside the time period in s 145(3).
44.	A question arises in these proceedings as to whether the correspondence sent to the applicant dated 16 August 2023 is in itself a notice under s 145(1). For the reasons that follow, I do not accept that to be the case.
45.	Section 145(1) provides for a notice to be issued to an “employer” or the employer’s insurer in respect of an injured worker. The term “employer” is defined as extending to a principal within the meaning of s 20 of the 1987 Act.  There is, however, no suggestion that s 20 applies in the circumstances of this case. Nor is there any evidence that Mr Tierney was employed by or entered into a contract of service with the applicant personally. Although the applicant was the sole director of FirmGuard, FirmGuard was a separate legal entity under the Corporations Act 2001. The fact that FirmGuard is now in liquidation does not render the applicant Mr Tierney’s employer.
46.	It is not, therefore, possible for a valid notice to be served on the applicant in accordance with 
s 145(1) of the 1987 Act. 
47.	I do not accept that the letter dated 16 August 2023 purported to be a notice under s 145(1) or is capable of being interpreted as such. The letter was, in clear terms, written to the applicant for the purpose of serving a certification pursuant to s 145A(3) of the 1987 Act. 
48.	Although the s 145(1) notice dated 3 March 2023 was annexed to the letter, I do not accept that the letter expressly or impliedly served the notice on the applicant for the purposes of 
s 145(1).
49.	Only a person “on whom a notice has been served under subsection (1)” can bring proceedings before the Commission under s 145(3).
50.	No express provision is made in s 145A or elsewhere for a culpable director to bring proceedings before the Commission for a determination of either the corporate employer’s liability to reimburse the respondent or the respondent’s power to recover an amount from the director.
51.	Section 145A simply provides a mechanism by which a statutory debt is raised and made recoverable in a court of competent jurisdiction. Proceedings may be brought for the recovery of a debt under s 145A in the District Court.
52.	Applying the principles identified in Raniere, I do not accept that s 105 of the 1998 Act gives the Commission inherent jurisdiction to determine either FirmGuard’s liability to reimburse the respondent, or the applicant’s liability, outside the circumstances provided for by 
s 145(3). No other statutory source of power has been identified. The matter does not, for example, fall within the categories of dispute identified in ss 289 or 289A of the 1998 Act.
53.	Should proceedings be brought against the applicant in a court of competent jurisdiction for the recovery of the debt pursuant to s 145A, the applicant will be entitled to defend the proceedings in that forum by reference to the terms of s 145A.
54.	For the reasons given above, I am not satisfied that the Commission has any power to make the orders sought by the applicant.
55.	It is appropriate in these circumstances that the proceedings be dismissed pursuant to s 54 of the Personal Injury Commission Act 2020.