CERTIFICATE OF DETERMINATION OF MEMBER  	

Citation:	
AFF Properties Pty Ltd v Robovich & Ors [2022] NSWPIC 733	
		
APPLICANT:	AFF Properties Pty Ltd	
		
FIRST RESPONDENT:	Jennifer Leslie Robovich	
		
SECOND RESPONDENT:	Solomon Robovich	
		
THIRD RESPONDENT:	Sabina Mead (née Robovich)	
		
SENIOR Member:	Kerry Haddock	
		
DATE OF DECISION:	20 December 2022	
		
CATCHWORDS:	Claim for lump sum death benefit pursuant to section 25 of the Workers Compensation Act 1987 and interest pursuant to section 109(1) of the Workplace Injury Management and Workers Compensation Act 1998; liability for payment of lump sum accepted; disputed claim for interest; first respondent resides in Queensland; second respondent resides in Victoria; third respondent resides in New Zealand; expression of opinion as to whether claim is federally impacted; consideration of Searle v McGregor, Attorney General for New South Wales v Gatsby, Condon v Bartley, Hayes v RACQ Insurance Limited, Smith v Allianz Australia Insurance Ltd, Ward v QBE Insurance (Australia) Ltd, Hackett v Allianz Australia Insurance Ltd and Watts v BKFY Pty Ltd; Held - there is no arguable basis that the applicant is a State as defined in the Commonwealth of Australia Constitution Act 1901. 	
determinations made:	OPINION
1.	There is no arguable basis that the applicant is a State as defined in the Commonwealth of Australia Constitution Act. 	
orders made:	1.	On or before 28 December 2022, the applicant is to file and serve evidence regarding any potential claim on the lump sum death benefit by Natasha Robovich. 
2.	On or before 6 January 2023, the respondents are to file and serve submissions on the issue of interest on the lump sum death benefit. 
3.	On or before 20 January 2023, the applicant is to file and serve submissions on the issue of interest on the lump sum death benefit.
4.	On or before 27 January 2023, the respondents are to file any submissions in reply on which they seek to rely. 
5.	At the conclusion of the time allowed for submissions, the issue of interest on the lump sum death benefit will be determined “on the papers”.
6.	The parties have liberty to request a further preliminary conference on or after 
9 January 2023, so that findings and orders on apportionment may be made. 

STATEMENT OF REASONS
BACKGROUND
1.	The worker, Hussein Sam Robovich (the worker) died on 13 March 2021 as a result of injury sustained on 8 August 2011 arising out of or in the course of his employment with the applicant, AFF Properties Pty Ltd (AFF). 
2.	The first respondent, Jennifer Robovich, is the worker’s widow. The second and third respondents, Solomon Robovich and Sabina Mead, are, respectively, the son and daughter of the worker.  
3.	By letter dated 8 February 2022, solicitors acting on behalf of Mrs Robovich made on her behalf a claim on AFF’s workers compensation insurer, AAI Ltd t/as GIO (GIO) for the lump sum death benefit of $834,200, pursuant to s 25 of the Workers Compensation Act 1987 (the 1987 Act); and funeral expenses pursuant to s 26 of the 1987 Act.   
4.	By letter dated 14 April 2022, the applicant’s solicitors advised Mrs Robovich’s solicitors that GIO had determined to accept liability for the claim. 
5.	AFF lodged an Application in Respect of Death of Worker (the Application) on 12 July 2022. 
6.	The first respondent lodged her Reply on 5 August 2022.  
7.	On 10 August 2022, delegate of the President, Parnel McAdam, made directions regarding possible claims by the second respondent, the third respondent, and Ms Natasha Robovich, who is the daughter of the worker’s first marriage.   
8.	On 24 August 2022, Delegate McAdam directed that Mr Robovich and Ms Mead be joined to the proceedings as the second and third respondents, respectively. He also made orders for service of the amended Application and Replies.  
9.	The second respondent lodged his Reply on 15 September 2022. 
10.	The third respondent lodged her Reply on 16 September 2022. 
ISSUE FOR OPINION
11.	The following issue is to be the subject of the expression of an opinion:
(a)	whether the determination of the Application is federally impacted. 
PROCEDURE BEFORE THE COMMISSION
12.	The matter was listed for preliminary conference before me on 10 November 2022.  
13.	Mr Harris appeared for the applicant. Mr Grady appeared for the first respondent; Ms Burns appeared for the second respondent; and Mr Groves appeared for the third respondent. 
Ms Morgan of GIO and Ms Dean of iCare also attended.  

14.	I was advised that the parties had agreed on apportionment of the lump sum. The applicant’s solicitor advised that he had been in contact with Ms Robovich and was able to provide evidence that he believes would be sufficient to determine that she was not dependent on the worker. I was also informed that there are claims for interest on the lump sum, in respect of which there is no agreement.     
15.	As the first respondent resides in Queensland, and the second respondent in Victoria, the question arose as to whether the matter was federally impacted. In accordance with the direction of the Division Head, the matter was remitted to him. The applicant’s solicitor advised that, should it be determined that the Personal Injury Commission (the Commission) had jurisdiction to determine the matter, the evidence in respect of any potential claim by 
Ms Robovich would be filed.   
16.	At the direction of the Division Head, an amended Direction was issued on 
23 November 2022. The parties were directed to lodge and serve written submissions on the issue of whether the matter is federally impacted.  
17.	The parties have lodged their submissions in accordance with the timetable. 
EVIDENCE
Documentary evidence
18.	The following documents were in evidence before the Commission and considered in making this determination: 
(a)	the Application and attachments;
(b)	Reply by first respondent and attachments;
(c)	Reply by second respondent and attachments, and
(d)	Reply by third respondent and attachments. 
OPINION AND REASONS
19.	It is unnecessary that I discuss the evidence in providing this opinion.  
SUBMISSIONS
20.	 The parties have provided written submissions, so I will refer to them only briefly. 
Applicant 
21.	The applicant submitted that the respondents have reached agreement on apportionment of the lump sum. There is no “dispute”, and absent a dispute, this is not a “federally impacted” matter.   
22.	The applicant relied on the decision in Searle v McGregor [2022] NSWCA 213 (Searle), and in particular the judgment of Kirk JA, whilst conceding that his Honour’s remarks were obiter.  
23.	The applicant submitted that the Commission does not exercise judicial power when adjudicating disputes involving interstate parties, because its decision makers offer “advisory opinions”, rather than judicial ones, and are therefore not exercising federal power.        
24.	The applicant finally submitted that the matter should be remitted to a Member for determination.  
25.	In reply, the applicant supported the respondents’ submissions.   
First respondent 
26.	The first respondent submitted that, in accordance with the decision of Member Harris, as he then was, in Ritson v State of New South Wales [2021] NSWPIC 409, residency is determined at the time the Application was lodged.   
27.	The first respondent submitted that the claim is between a private company and residents of Victoria and New Zealand. For federal jurisdiction to apply, s 75 of the Constitution needs to be engaged.
28.	Section 75(iv) of the Constitution provides that the High Court has original jurisdiction in all matters:
(a)	between States;
(b)	between residents of different States, and
(c) 	between a State and a resident of another State (emphasis in submissions). 
29.	State tribunals, including the Commission, cannot determine federal matters – Attorney General for New South Wales v Gatsby [2018] NSWCA 254. Section 26 of the Personal Injury Act [sic: Personal Injury Commission Act 2020; PIC Act] provides that applications involving federal jurisdiction may be made to the District Court.  
30.	The first respondent submitted that, consistent with the decision of Wilson SC DCJ in Condon v Bartley; Hayes v RACQ; Smith v Allianz & Ors NSWDC [2022] 282 (Condon v Bartley; Hayes v RACQ Insurance Limited; Smith v Allianz Australia Insurance Ltd; Ward v QBE Insurance (Australia) Ltd; Hackett v Allianz Australia Insurance Ltd), where he determined private CTP insurers were private companies and not part of the State of New South Wales, AFF is a private company. It does not form part of the State of New South Wales.  
31.	The first respondent submitted that, as the dispute is between a private company and residents of Victoria and New Zealand, it does not meet any of the criteria in s 75 (iv) of the Constitution and is not federally impacted.  
32.	The first respondent finally submitted that federal jurisdiction does not apply, and the Commission has jurisdiction to determine the dispute.   
Second respondent 
33.	The second respondent adopted the submissions of the first respondent. 
Third respondent 
34.	The third respondent adopted the submissions of the first respondent.  
35.	The third respondent submitted that the Commission should remit the matter to a member “without delay” for determination of the issues. It submitted the Commission has jurisdiction to determine the issues.   
SUMMARY
36.	Since the submissions were received, Principal Member Harris has provided an opinion on the issue of federal jurisdiction in Watts v BKFY Pty Ltd [2022] NSWPIC 700 (Watts). 
37.	As Principal Member Harris’s opinion accords with the parties’ submissions, I do not believe it is necessary to request submissions on Watts.
38.	In Watts, Principal Member Harris observed that the parties assumed that the determination of the claim involved the exercise of judicial power; and “[T]hat assumption is far from clear”. He referred to the decision in Searle.  
39.	Principal Member Harris accepted that this criterion is arguable until a Court definitively rules on the issue. He said:
“No doubt consideration of this issue with respect to the Workers Compensation Division will include the exclusive jurisdiction of the Commission to hear and determine all matters under the 1987 Act and the 1998 Act [the Workplace Injury Management and Workers Compensation Act 1998] and the finality of the decision subject to appeal based on error of law, fact or discretion. Issue estoppel and Anshun estoppel applies to decisions in the Workers Compensation Division…Indeed, some disputes such as claims for the payment of death benefits involve significant amounts of compensation and may be suggestive of an exercise of judicial power. Lump sum payments under s 66 of the 1987 Act can also be significant and provide the gateway to an entitlement to bring a claim for damages.”
40.	In Watts, the applicant submitted that:
“The Respondent is not the State of New South Wales but an independent entity subject to workers compensation scheme run by the State. The liability for the injury lies with the employer and not with the insurer. The insurer pays the compensation, but the suit, the matter, is against the employer.” 
41.	Principal Member Harris rejected as “unarguable” a submission by the respondent that if “the correct approach is to look to the insurer of the respondent” then Insurance and Care NSW is relevantly a State. He held that the claim is brought by the worker against the employer, not the insurer. 
42.	Principal Member Harris referred to s 9 of the 19887 Act, which provides:
“A worker who has received an injury…shall receive compensation from the worker’s employer in accordance with the Act”. He said, “The clear words of the section is that the worker receives compensation from the employer”. He regarded this as consistent with the observations of Kirk JA in Searle that the appropriate party should be identified when this issue is considered.”
Kirk JA stated at [24]:
“There is a wide range of disputes that may arise under statutory schemes such as the MAI Act and the workers compensation legislation. For some disputes the relevant disputants may be the claimant and the insurer of the other person involved (ie the other driver or the employer).”
43.	Principal Member Harris held that his Honour’s observations were consistent with s 59(2) of the PIC Act, which provides that a certificate for the recovery of the amounts ordered to be paid must identify “the person liable to pay the certified amount”.   
44.	He went on to say:
“In the present matter, the action is brought against a private company and not the insurer. It is not submitted that the respondent employer is a “State” but rather that the insurer may be a State. The applicant was employed by the respondent to clean apartments. The respondent clearly is a private company engaged in a cleaning business.

Whilst the insurer exercises a statutory right of subrogation, that does not alter the identity of the parties to the proceedings. Accordingly, in the action between the applicant and the respondent, there is no arguable defence that the respondent is considered a State for the purposes of the Constitution.”

45.	Section 25(1) of the 1987 Act provides that:
“If death results from an injury, the amount of compensation payable by the employer under this Act shall be…” (Emphasis added).
46.	The wording of s 25 of the 1987 Act is consistent with that of s 9 of the Act.
47.	The worker was employed by the applicant as a machinery operator and farm hand. The applicant is clearly a private company engaged in the agricultural industry.      
48.	I have concluded, in accordance with the decisions in Searle and Watts, that there is no arguable basis that the applicant is a State as defined in the Constitution. I note that no party submitted otherwise. 
49.	The opinion and orders are as set out in the Certificate of Determination.