Accident Compensation Commission v Odco Pty Ltd (Trading as Troubleshooters Available)

[1990] HCATrans 89

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M60 of 1989

B e t w e e n -

ACCIDENT COMPENSATION COMMISSION

Appellant

and

ODCO PTY LTD (trading as

TROUBLESHOOTERS AVAILABLE)

Respondent

MASON CJ
BRENNAN J
DAWSON J
TOOHEY J

McHUGH J

Accident(2)

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON FRIDAY, 4 MAY 1990, AT 10. 16 AM

Copyright in the High Court of Australia

C2T 1 /1 /ND 1 4/5/90

MR J.G. LARKINS, QC: If the Court pleases, I appear with

my learned friend, MRS. O'BRYAN, for the

appellant in that matter. (instructed by

T.D. Weerappah, Solicitor to the Commissioner of

Pay-Roll Tax)

MR M.E.G. BLACK, QC:  May it please the Court, I appear with

my learned friend, MR P. COSTELLO, for the respondent.

(instructed by Roth Warren & Menzies)

MASON CJ:	Yes, Mr Larkins.
MR LARKINS:	Might we commence by asking that the Court be

handed copies of the outline of argument. It is

arranged in sets with the outline at the top

followed by what we have been pleased to call a

flow chart.

MASON CJ:	A flow chart?
MR LARKINS:	A flow chart and I do not know that it is a

particularly apt expression but that is what we

have chosen to call it.

MASON CJ:  I thought they were documents used in the tax

office.

MR LARKINS:  And nextly we have a set of s-t:rch extrinsic

materials as appears (o be available, none of which

I might say would be of any substantial assistance

to the Court.

MASON CJ:	Do we need to look at it then?
MR LARKINS:	Not really, except there is a reference to it

in a decision of Mr Justice Murphy, in the Full

Court decision in the MAYNE NICKLESS case to which

reference is made in our list of authorities, and

we thought that if there are, as it were, edited

highlights appearing in His Honour's judgment

somebody would surely ask us what else appeared

extrinsic materials which takes the matter any	so the reality is that there is nothing in the	further than indicated by His Honour
Mr Justice Murphy in the course of his judgment
in the Full Court.

This is a difficult case to know how to approach

before the Court because ultimately it turns on

the words of the Act. In this case there has been

an assessment under the ACCIDENTS COMPENSATION

ACT of a levy under section 203. The assessment

is of leviable remuneration paid or payable by

the respondent and that remuneration, as we would

suhnit, is liable to levy Jnder the Act because it is in

respect of employment which is undertaken in Victoria, and so

on, and falls within the criteria set out in section 186

of the Act.

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Accident(2)

MR LARKINS (continuing):  So the actual imposition of the

levy is by section 187 which imposes a levy on leviable

remuneration under section 186.

The provisions of Part VII of the Act relate

to the registration and returns of employers, and

so on, the collection and recovery of levy,

but the critical issue in the present case really

comes down to seeing whether the remuneration question

is paid by an employer, as defined in the Ac½ to an

employee, as defined in the Act and that requires

looking at the definition sections in the first place

in section 5. Under section 5 of the Act,

an employer is defined to include, amongst persons:

any person deemed to be an employer by

this Act -

and section 5 of the ACCIDENT COMPENSATION - - -

BRENNAN J:	Unfortunately, I think, our copies start at section 7.
MR LARKINS:	It, perhaps, does not really matter. Section 5

defines sim~ly an employer by section S(l)(c):

any person deemed to be an employer by this Act.

And we then look further into the Act, beyond

section 7, to see who is deemed to be an employer

under the Act. By section 5 also, "worker" means:

(a) a person -

who is a worker -

under a contract of service -

in the ordinary way or is:

(b) ..... under this Act is deemed to be

working under a contract of service;

or -

(c) a person who under this Act is deemed to

be a worker.

11Who,under this Act is deemed respectively to be an	So the question then advances to the next stage
employer or to be a worker?", so the definition
includes - - -

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Accident( 2)

MASON CJ:  So, you then move to sections 8 and 9.

MR LARKINS: Yes, Your Honour. That is the way you get to

sections 8 and 9.

If, then, one looks just very briefly to the

underlying facts of the present case, the respondent
is an agency which makes labour available to builders

on site on request under an agreement entered into

by it and the builder who might require labour to

carry out works on a building site. The respondent

does that by going through its records to ascertain

which of a number of people who have registered with

it is suitable for a particular task and would be

available to do that; contacts them; advises them

of the detail of the work and so on and, in the

present case, the Court is concerned with a

particular month, namely, April 1987, during which

a number of persons worked under these arrangements engaged by the respondent attending to the building

site, carrying out work for builders, earning

renumeration for themselves by receiving money from the respondent and earning money for the respondent which would have, of course, received the money from

the builder in turn.

The circumstances of the case are that there are

very many such persons engaged and the parties conducted

the matter before the courts below by taking tour

typical examples of the classes of persons undertaking

this work having been engaged by the respondent and

having, then, made their services available on

building sites pursuant to arrangements made

between the respondent and the individual builders.

(Continued on page 5)

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Accident(2)

MR.LARKINS (continuing): And the four individuals concerned

were a Mr Ditchfield, a scaffolder, Mr Alexander,

a labourer, a Mr Paterson who was actually

conducting a building business in partnership with

his wife, and a Mr Clancey who was an employee of

the company which made his services available to

carry out work on site as a building site supervisor.

The arrangements between the individuals concerned

and the resnondent are to be found in a form of written

agreement'and a convenient place to locate that is

at pages 189 and 190 of the appeal book. I invite

the Court to look at those pages. This is the

form of agreement which is entered between a person

expressing a willingness to undertake work on
building sites pursuant to the arrangements which
the respondent was to make with builders who would

require contractors or tradesmen of particular

categories. The tendency is to call them all

tradesmen; strictly, I suppose, some of them are

not tradesmen in a strict sense but they are building

workers of various classifications.

The form is what purports to be an "Agreement to

contract", "Conditions of contract", and if one turns

to clause 1:

I (the undersigned) acknowledge and agree that

there is no relationship of Employer-Employee

with TROUBLESHOOTERS AVAILABLE and that

TROUBLESHOOTERS AVAILABLE does not guarantee

me any work. I (the undersigned) am

self-employed and as such I am not bound to

accept any work through TROUBLESHOOTERS

AVAILABLE.

(Continued on page 6)

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Accident(2)

MR LARKINS (continuing):

2. I (the undersigned) hereby agree to

work for -

and there is no number of dollars stipulated -

per hour for actual on-site hours

or job price to be agreed.

3. I (the undersigned) hereby acknowledge,

and agree, that TROUBLESHOOTERS AVAILABLE

does not cover me in respect of Workers

Compensation, the onus of responsibility

and liability in respect of insurance

(Workers Compensation) is mine only.

MASON CJ:  We have read the documents. It is set out in the judgment. I think it would be of more assistance

if you pointed out to us any characteristics of the

contract which are significant from the point of view

of the argument you are presenting.

MR LARKINS:  Well, the first thing, if I might point out, with

respect, in clause 2, is that there is an agreement

to work for a nominated sum in some cases for actual

on-site hours or job price to be agreed. It is

clear that there is nothing in this contract which

requires a signatory of it necessarily to accept

any particular engagement, that is to say that he

is not obliged to say yes, he will attend tomorrow

at a particular building site.

McHUGH J:	But is it any more than a standing offer?
MR LARKINS:	I think that that might be an accurate

description of it, Your Honour, because it comes

into effect and operation, of course, on a given day

when the contractor, having been contacted by the

respondent, agrees to attend at a particular site,

in which case these conditions come into operation,
yes.	The only other significant matter we would

respectfully point out is that the obligation is, in

respect of payment,not on the builder, but on the

respondent, and in clause 9 the agreement is to:

supply my own plant and equipment,

safety gear -

and so on, and -

have no claim on TROUBLESHOOTERS AVAILABLE

in respect of the above.

BRENNAN J:  Where is the obligation to pay?

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Accident(2)

MR LARKINS (continuing): In clause 2 the agreement to work for the certain

number of dollars and in clause 6 it contains:

that I am guaranteed to be paid agreed hourly rate

for actual on-site hours or agreed job price

for work done.

TOOHEY J:  Mr Larkins, is clause 6 to be read as "I am

guaranteed to be paid by Troubleshooters"?

MR LARKINS:  Yes, Your Honour. There is no dispute about

this aspect of the matter. The procedure which

is otherwise set out in the evidence, which I

do not know that I could irrnnediately take the

Court to, is that the builder is invoiced by the respondent for the number of hours of a particular

employee at one rate. The contractor is then paid

by Troubleshooters for the number of hours, at

another rate, and there are indeed examples of the

invoices contained in the appeal book at various

points, for example, at page 58.

BRENNAN J: But is the payment that is made to the worker a

payment which is made in discharge of an

antecedent liability owed by Troubleshooters or

or the builder?

MR LARKINS:  By Troubleshooters.

BRENNAN J: Is that corrnnon ground?

MR LARKINS:  I would think that that would be corrnnon ground.

There is no suggestion at any point that the

builder undertakes contractural liability direct

with the contractor. The builder's responsibility

is to pay the amount invoiced by Troubleshooters

in respect of the hours worked by the contractor.

BRENNAN J: Is it corrnnon ground then that there is no contract

between the builder and the worker?

MR LARKINS:	Yes, that is the position.
McHUGH J:	But what about the arrangement between the Troubleshooters and the builder? Is there any evidence as to what
the arrangements were in relation to these cases?
MR LARKINS:	Yes, Your Honour. That is to be found at

Exhibit BPG15, which I will turn up at page 163 of the appeal book.

(Continued on page 8)

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Accident(2)
MR LARKINS(continuing):	My learned friend is reminding me that

there is also evidence about this in the affidavit

but the detail of the arrangement is set out in the

document which commences at page 163 and, in

respect of payment, that is included as "Conditions

of Hire", with the rates set out on page 164;

'tonditions of Hird'on page 165, the minimum hire,

wet weather allowance and travelling time and

parking and so on. Terms arc set out at page 166,

at the top of the page, line 5, "Our terms are

strictly 14 days nett".

McRUGH J: Well, then, Troubleshooters docs not itself enter

into any arrangement to do work.	They just simply
provide workers, is that - - -

MR LARKINS: Well, if I may say so, Your Honour, that is really

the problem before the Court. It is a question of

how you def inc "work". In the sense of hammering

of nails on site, Troubleshooters docs not undertaken

of an obligation to hammer a nail on the building site.

It undertakes, however, an obligation to provide a

person who will hammer nails on the site and the
business of Troubleshooters is the provision of
the man and his necessary equipment to carry out
the desired task, whether hammering nails or

whatever and for that it is entitled to charge and

docs charge rates which arc set out on page 164

and for the number of hours that the relevant
worker is on the building site, taking into account

travelling time and the other add-ons, of course.

(Continued on page 9)

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Accidcnt(2)

MR LARKINS(continuing): It is really a question of

characterization. Do you say that Troubleshooters

is undertaking work on the building site by

procuring a person to go to the building site with

his tools, be ready for work to follow the

instructions of the builder, having got to the

building site, then following the instructions

in a way which is satisfactory to the builder because
if it is not satisfactory to the builder the builder
will send the man away, thereby earning the

entitlement to the remuneration at the agreed rate.

TOOHEY J: It gives a certain obscurity to clause 2, does

it not?

MR LARKINS:	Of the?
TOOHEY J:	Of the contract:

I agree to work -

because, on one view, not to work for you, but

that is "you" being Troubleshooters - I agree to

work for what, someone as yet unknown?

MR LARKINS:  But it is clear, with respect, that the work

which is to be done, for example, as set out in

clause 7 is:

It is agreed that I must carry out all work

that I agree to do through the Agency of

TROUBLESHOOTERS AVAILABLE in a workmanlike

manner and is hereby guaranteed against

faulty workmanship.

So that the work, in a sense, is at two levels. One having accepted the engagement to attend on a particular site or a particular day, attending

there, being ready to undertake the work and,

indeed, undertaking it in a way which is

satisfactory to the builder and then - - -

TOOHEY J:  And what are the consequence between the parties

to the contract if the work is not done properly?

MR LARKINS: Troubleshooters would not earn its remuneration

because the builder pays for on-site hours only
and the worker would not receive his remuneration
or his entitlement to remuneration from

Troubleshooters - - -

(Continued on page 10)

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Accident(2)

McHUGH J:  But if the worker carried out his work negligently

the builder would have no contractual right of

action against Troubleshooters for faulty

performed work, would he?

MR LARKINS: It depends,with respect,what the - if the man

is sent out there as a carpenter and he is a

person who has no skills as a carpenter, it might

be quite a different matter, with respect.

If what happens on site is that the builder says,

"Hammer that nail in there" and the contractor

says in substantance that there is no way in the

world that I am going to hammer that nail there

and stomps off the site, then the liability,

one would suppose, of Troubleshooters simply to

provide another workman in lieu of the unsatisfactory

one - that is what Troubleshooters has undertaken

to do, is to provide a satisfactory workman who

carries out the reasonable directions and requirements

of the builder.

BRENNAN J:  I do not know whether it is critical to the

argument or to the analysis that has to be made but
at present it seems to me that there is an absence

of specificity in any finding as to the contractual

relationship which would be material. It is not

the standing offer which is material. It is the

agreement that is made with respect to each

specific activity, and at the moment I do not know

what finding there is which says what is the duty

of the worker when he goes to a site. Is it to do

what the builder requires in accordance with the

builder's instructions as though he were an

employee of the builder?

MR LARKINS:  That would be our submission, Your Honour.

BRENNAN J: That is a question of fact, is it not?

MR LARKINS:  In any particular case that may be but in the way

in which this has been conducted, what we have

here is a form ofstanding offer as has been

identified. We have the evidence of the contractual

obligation as between Troubleshooters and the

builder which is in the document, page 163 of the

appeal book, and I must say that our assumption has

always been that the consequence of an entitlement
to payment with an undertaking contained in

clause 7 of the agreement of guarantee of

satisfactory performance by the worker, it really

does carry with it, if not explicit term, an implicit

one that the obligation of the person is to attend

at site and to carry out duties of a nature which

is appropriate for a carpenter on that building

site.

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Accident(2)

BRENNAN J: Well that means that for your part, at all events,

you would seek to identify the work which is to

be done by a worker or by a tradesman as

discharging an obligation owed to Troubleshooters

and the obligation is discharged by doing that

which a third party, namely, the builder, directs.

MR LARKINS:  Thereby entitling Troubleshooters to remuneration.

BRENNAN J: Well, that does not matter so far as the contract

between the employee and Troubleshooters is concerned.

MR LARKINS:  No, of course, that is a happy circumstance, if

not a coincidence. If I could put it in

very general terms: the complaint which we have

of the decision below is that the work which has

been identified is the physical hannnering of the

nails on the site. What we submit is that the

work which is undertaken by that contractor is

more than the carrying out of the directions of the
builder on the site. It is having accepted the
engagement, in fact appearing at the site ready
to undertake work, appearing at the site with

tools which are appropriate to his calling, and

having appeared at the site - and this part of

my argument was,as I would fear,done less than

justice by the Full Court - carrying out the

directions of the builder in a way which meets the

guarantee contained in clause 7 of the agreement,

that is to say carrying out the work in a way

which is guaranteed against faulty workmanship.

(Continued on page 12)

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Accident(2)

BRENNAN J:  You have not got a finding to that effect, hdve

you?

MR LARKINS:	In what way, Your Honour?
BRENNAN J:	Well, that contract, that is, between

Troubleshooters and the builder.

MR LARKINS:	No, I am sorry, this guarantee is in the contract between Troubleshooters and the contractor
at page 215.
BRENNAN J:	I see.

McHUGH J:  It seems to me to be lacking evidence or

findings to some fairly crucial matters concerning

the true relationship in each of these cases

between the builder and the Troubleshooters. It

makes me wonder whether this is a proper case for a

test case.

MR LARKINS:  Well, if I can just take up one thing before

I overlook it. The question of the finding

Justice Brennan was referring to, I would refer to

the passage in the judgment of Mr Justice Gray at

page 199 of the appeal book where His Honour came

to the conclusion:

But the form -

which is the form of agreement between Troubleshooters

and the contractor -

does, in my opinion, contain a set of
provisions which are brought into
contractual operation when the contractor
accepts an offer of work proffered by TSA.

It is sufficient to refer to Clause 7 by which the contractor agrees that he

"must carry out all work that I agree to

do through the agency of TSA in a workmanlike

manner". By Clause 2 the contractor agrees

to work for a stated hourly fee "for

actual on site hours".

When TSA makes payment to contractors,

it clearly does so pursuant to a contract

and, equally clearly, it is a contract

under which the contractor agrees to do

work. The contractor gets paid by TSA when

and because he has done work. In this

commercial context, the contractor is

undoubtedly getting paid pursuant to a

contract.

That is really borne out by the sort of claim forms

for payment which are set out in the appeal book

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at various spots which I have lost. Fo~ _

example, at page 57 of the appeal book there is a

form of claim by Troubleshooters to a builder

setting out the name of the subcontractor is

described, the hours o~ codes of, I take it,

indicating the type of tradesmen, the hours charged,

the rate, leading to an amount and

inviting payments with a prompt payment discount

allowable.

TOOHEY J:  But for the purposes of resolution of this appeal,

Mr Larkins, to what extent are you concerned with the relationship between Troubleshooters and the builder as opposed to the relationship between

Troubleshooters and the contractor?

MR LARKINS:  We are not concerned with the relationship

between Troubleshooters and the builder. We are

concerned with the - because that does not lead, if

you look at one of the flow charts that we have

prepared,-we have looked at that but it does not,

in fact, lead to any conclusion which is relevant

or, in fact, any useful conclusion at all. The Act

does not apply to that contract so that we are not

concerned with that.

TOOHEY J:  What, and you take~ a stand on the relationship

between Troubleshooters and the contractor and you

must find,for the purposes of the Act, the

relationship of employer and the payment of

remuneration.

MR LARKINS:  Indeed, and we would also say that we accept

and always have accepted that you can apply the

provisions of the Act and come to different

conclusions in relation to the contract between

the builder-can also be regarded as an employer

but we are not - if I can remind the Court, in the

Full Court it was said, "Well, if you'd prefer to

look at the contract between the builder and the

tradesmen, look at that and see whether it's a

relevant contract". Well, we are not interested in

that because the - well, my learned friend says he is -

no doubt, he is but we say, yes, well that may be

so, there may be a relevant contract appli;ed to that

relationship-arising from that relationship but it is

not one which is exclusive, that is to say that you

can have more than one relevant contract. You have

different people, as deemed employers, of the same

deemed employee so that more than one person may be

assessed in respect of the remuneration paid to the

same worker but that is provided for in the Act and

double levy ability does not arise.

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Accident(2)

McHUGH J:	But do we not have to know more about the relationship -
between the worker and the builder and, for that matter, between Troubleshooters and the builder, to determine the application of section 9?

MR LARKINS:  We would not have thought so, with respect. There

really is no more to know. The contract with the

builder is set out in the appeal book and was part

of the evidence before the court and that is to

be found as part of the document, at page 163.

There is no contractual relationship as we would

contend between the contractor and the builder.

He simply presents himself at site, says, "I am

Joe Blow. Troubleshooters have sent me. It is seven o'clock. It is starting time. I am standing by with my tools of trade, ready to undertake work

and I have an obligation to Troubleshooters to carry
out work in a way which is covered without - faultless

or guaranteeing quality" and so on.

In our respectful submission, there is nothing

more that can be said.	The man goes there and
presumably carries out his work.	The invoice is
rendered.	We have seen copies of the invoices, trey are th::n
paid.	The conclusion is really one of classification;

to say when the man goes on~ site, is he carrying

out any work for Troubleshooters as well as carrying
out work for the builder? He is undoubtedly carrying

out work for the builder in the sense that the builder's

work is being advanced but, equally, he is carrying

out work for the person who is the proprietor of the

building site because his building is one nail closer

to completion and that is the problem.

If I could turn to the precise words of

section 8 which is the first of the relevant

prov1s1ons:

Notwithstanding anything in this Act or any

other law, where any person (in this section

referred to as "the principal") in the course

of and for the purposes of a trade or business

carried on by the person -

and in the present case we would say that

Troubleshooters -

in the course of and for the purposes of a

trade or business carried on by -

Troubleshooters -

enters into a contract with any natural person

or natural persons -

in this case, either of Ditchfield, Alexander or

Paterson -

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(in this section referred to as "the

contractor) -

(a) under or by which the contractor agrees
to perform any work not being work incidental
to a trade or business regularly carried on by
the contractor in the name of the contractor

or under a firm or business name; and

(b) in the performance of which the contractor
does not either sublet the contract or employ

workers or although employing workers actually

performs some part of the work personally -

so that if we can confine ourselves, firstly, to the

simplest case of Alexander the labourer, if you go

back and apply the words of the section to that

situation, where TSA, in the course of:

and for the purposes of a trade or business

carried on by -

TSA -

enters into a contract with any natural person -

for example, Alexander -

under or by which -

Alexander -

agrees to perform any work not being work

incidental to a trade or business regularly

carried on by -

him - and that has been found by Mr Justice Gray to

be this case -

and in the performance of which -

Alexander -

does not either sublet the contract or employ

workers -

which would be his case -

then for the purposes of this Act -

Alexander -

shall be deemed to be working under a contract

of service with an employer .and the principal -

TSA -

shall be deemed to be that employer -

C2Tll/2/SH	15
Accident(2)

We say it is as simple as that and the only problem

is "agrees to perform any work" and as

Chief Justice Latham is taken in HUMBERSTONE to

have said, "Well, that must be work for the principal"

and, in a sense, we do not think that there is any

other real conclusion; it is just a question of

defining what the work in this particular case means;

namely - - -

McHUGH J:	So you accept that?
MR LARKINS:	Pardon?
McHUGH J:	You accept that in (a) "agrees to perform any work"
must mean "agree to perform any work for the principal".
MR LARKINS:	That seems to be so, yes, Your Honour.
McHUGH J:	Yes.
MR LARKINS:	We do not quibble with that aspect of it or -

it depends, in a sense, how you define it.

McHUGH J:  Yes.

MR LARKINS: If you accept our basic premise that going to the

building site and when arriving there been willing

to undertake work and then carrying out work in the

directions of a third party, is work which is

performed for the principal sending the person there,
then that is sufficient connection between the work

and the principal, in our submission, to answer the

sort of general description, Chief Justice Latham's

requirement, if I can put it that way.

(Continued on page 17)

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Accident(2)

McHUGH J: Well supposing my wife gets an employment

agency to send somebody out to get her

to do housework and she gets billed by the

employment agency, is the person doing the

ironing and washing for the employment agency?

MR LARKINS:	She is not an employee of your wife, because your wife is not doing that in the course of
any business carried on by your wife, but she
would be of the employment agency or might well
be, yes.
McHUGH J:	You would hardly describe her as carrying out
ironing for the employment agency, would you?

MR LARKINS: Well, it depends, if I might say so, how the

person is remunerated. I would resent the idea,

I might say, that I am carrying out work for my

clerk, when my clerk arranges that I should be

here today in return for a fee of some sort. The

distinction here is that Troubleshooters is being

paid for doing something and it is being paid not
a percentage of somebody else's earnings, it is

being paid a sum which bears no necessary relationship

to the worker's pay. The - - -

McHUGH J: But it is being paid for sending somebody out there.

He then takes that person over and requires that

person to do this or that.

MR LARKINS: Well, it may be, but the person who is going

there is not going there for the good of his health.

It is part of his work to pack up his tools, put

them in his car, take them to the building site.

McHUGH J:	The question is whether what he does is Troubleshooters'
work?
MR LARKINS:	Yes.

MASON CJ:	But why are we concerned with that, whether it is
Troubleshooters' work or anyone else's work?

MR LARKINS: Well only if you accept - - -

MASON CJ:  Under clause 2 he agrees with Troubleshooters to

perform work. Now why are we concerned with the

fact that it happens to be somebody else who is

the ultimate beneficiary in that work?	I mean put
to one - - -

MR LARKINS: Well that is what I am saying. I was trying to

slide in there easily and not say that we did not

accept what the learned Chief Justice Latham said,

that is - - -

C2Tl2/l/CM	17
Accident(2)

MASON CJ:  I would put what Chief Justice Latham said to
one side and just look at the words of section 8(l)(a).

MR LARKINS: Well, if I might say so with the greatest respect,

Your Honours, that seems to be the simple case is

that one looks at the section -

MASON CJ: Well why not be straightforward about it, rather

than endeavour to accomodate yourself to what is

thought to be Sir John Latham's view.

MR LARKINS:	Well - - -
McHUGH J:	I think you are in fairly serious trouble on that,
speaking for myself.

MASON CJ: Well maybe, but you may not have the same trouble

with me.

DAWSON J:  Incidentally, does the same worker have to go

every day? I mean can the agency send one one day

and another the next?

MR LARKINS: Yes. I suppose the builder may stipulate that

Mr Xis a particularly skilled man and request his

services particularly, but there is nothing in the

contractural arrangements as they stand and indeed

it might well be that a particular contractor is

wishing to take a day off fishing. One of the

attractions from the contractor's point of view is

the possibility of discontinuity of work, we would

have thought. It seems to us, with the greatest

of respect, that what the Full Court did and indeed

what Chief Justice Latham if he said that did, was

introducing a gloss on the language which is not

there and which is - - -

BRENNAN J:  Mr Larkins, is your case this, simply,that here

is a case where Troubleshooters in the course of,

et cetera, entered into a contract with the

tradesman under which the tradesman agreed to do

worki That is the start and the finish of it.

MR LARKINS:  Yes.

TOOHEY J: Well it is not quite the finish,is it? It is to be

not work incidental - - -

MR LARKINS:	I was going on to that next.
BRENNAN J: That is another matter.	I mean that is the start and

the finish of your argument.

MR LARKINS: That is really it.

C2Tl2/2/CM	18
Accident(2)
BRENNAN J:	Now, there is onJ_y one problem about it. Are the facts

cormnon ground that that is so?

MR LARKINS: That they undertook work?

~ J: That they entered into a contract with the tradesman

for the tradesman to do work.

MR LARKINS:  Well my learned friend is saying to my right that

it is not cormnon ground. It is not coulillon ground because

what he does is introduce a gloss on to work which means

_that very part_i~ular work, that is t_o say the physical wo:

has to be done for the benefit of the person who

is to be the deemed principal thus, in the case

of the building contractor, the work has to be done on the building site and that is for the benefit of the builder, not for the benefit of TSA, and we say

that that is not right.

(Continued on page 20)

C2Tl2/3/CM	19	4/5/90
Accident(2)

BRENNAN J: If that is the point, the only point we have

to decide is whether there is a gloss on the

language?

MR LARKINS:	Yes.
McHUGH J:	But earlier I thought you conceded -
MR LARKINS:	I was doing that, as it were, in a moment of

weakness because it seemed a good idea at the time

but it really depend on how you define it.

What I would be accepting is that if you give the definition of the word "work" a wider connotation

to include both physical work and the work

necessary to earn remuneration, then we would say

that it is done for the benefit of the principal,

namely Troubleshooters, so that the gloss can

remain. If you define "work" as something going

beyond the hammering of the nails, if you say that

it is a sufficient benefit to the putative

principal to go to the building site and carry

out your duties to the satisfaction of the builder,

whatever those duties might be, then although you

get benefit to the builde~ you get benefit to the
building owner, you get benefit to TSA and TSA

therefore takes part of that benefit and therefore

it is for it.

So that, in that sense, you could say, "Well,

it is for the benefit of the principal." It is,

really - once you start saying that "work" means

the hammering of the nails as distinct from

presenting to a site with the tools and then carrying

out the reasonable directions that you then need

to say, "Well, the gloss doesn't work".

McHUGH J:	But why was Sir John Latham wrong, in any event?
MR LARKINS:	The word, which he agrees to perform any work,

really - - -

McHUGH J: Yes, but it has got to be read in the whole context

of the section. This is deeming a contract of service

and does that not give some flavour to the whole

matter and suggest that there is a relationship

in which work is done for the principal but because

he is not an employee nevertheless, in the particular

circumstances, you would deem it to be a contract
of service? And does not the fact that section 9

deals with this question of supplying services

of persons reinforce that?

DAWSON J:  The answer to that it is not only deeming a contract

of service but it is deeming an employer.

MR LARKINS: Yes. Section 9 may, in fact, cover in a different

way much of the ground of section 8 and there is

C2Tl 3/1 /ND	20	4/5/90
Accident(2)

a curious history to all this which might suggest

that the draftsman of the original section 9 which

appeared in the PAY-ROLL TAX ACT was not aware

of or did not have to mind the provisions which

pre-dated section 8 in the old WORKERS COMPENSATION

ACT which had been in effect for a number of years

and that somebody has started off from scratch

to try and cover the same ground in different

legislation not knowing of the provisions in

what is now the ACCIDENT COMPENSATION ACT.

But it really does come down in under

section 8 to the question of whether the work must

be physical work for the benefit of a principal

and in the context of the present case whether
that physical work is sufficiently performed by

a contractor going to the site and undertaking

the functions which are directed of him by the

builder who wants the nails hammered and so on.

BRENNAN J: It does not say "physical work" either, does

it?

(Continued on page 22)

C2Tl3/2/ND	21	4/5/90
Accident(2)

MR LARKINS:  No, it does not, but I would have thought - - -

BRENNAN J:  Why? ..... windmill no constantly.

MR LARKINS:  We would respectfully submit that there is a

sufficient performance of work by putting yourself

in a car in the morning and driving to the work

site with tools and saying, "I am ready to undertake

your reasonable directions as a carpenter on site".

BRENNAN J:	But the relevant question under the Act is whether those actions are actions which,pursuant to the
contract that has been entered into, have to be
done.

MR LARKINS:  Yes, Your Honour, and we would say that they

do because of the form of the agreement which is

entered into between the workman and Troubleshooters

because once he accepts the obligation to go to

site, he is entitled to no remuneration unless he

attends at site and is entitled to payment when

he is on site, and in the context of a building

labourer supplier, it is inconceivable that he

is to attend to site and sit in the crib

shed all day.

BRENNAN J:  You might be met with an argument that is a

unilateral contract and that is that it is only by

performance of the work that he has any contractual

rights, and then ~ question would arise as to

whether it was a contract by which he had agreed

to perform.

MR LARKINS:  Clause 7, however, does say that he must do the

work which he agrees to do so that if he agrees

to attend at site, he has then to attend site and to carry out the work on site, in our submission.

The second aspect of section 8 of the Act,

of course, is whether they are carrying on a

business. That is to say that the work is not:

incidental to a trade or business regularly

carried on by the contractor in the name

of the contractor or under a firm or

business name.

There is considerable discussion of the meaning

of that in the judgment of Mr Justice Dixon in the HUMBERSTONE case and I will not read those

passages to the Court.

C2Tl4/l/LW	22	4/5/90
Accident(2)

In the present case the findings of

Mr Justice Gray make it very clear that in the

case of both Alexander and Ditchfield there

was no business being carrying on by either

of those gentlemo1, and in the case of

Paterson there was. The Full Court, in the case

of Ditchfield, did say something which might

be taken to lead to a different conclusion

but we would rely on the fact that Mr Justice Gray

found the facts in relation to Ditchfield's

situation and there is really no cause for the

Full Court having rejected our argument under

section 8 to enter into this exception at all,

and they really did not give it any particular

consideration.

The matter that I was referring to,

Your Honours, in the case of Ditchfield in the

judgment of Mr Justice Gray appears at page 201

and at line 20 His Honour said:

The evidence shows that, during the month

of April 1987, Ditchfield worked solely for

TSA. I have already stated the hours worked.

The question raised by the exception is

whether Ditchfield's work for TSA was

incidental to a trade or business regularly
carried on by Ditchfield in his own name.

If one looks only at the month of

April 1987, it is difficult to find
evidence of any business of Ditchfield's to

which his work for TSA could be said to be

incidental. Furthermore, the evidence shows

that for the 12 months ending in April 1987,

Ditchfield averaged 47 hours per week working

for TSA.

Then there is a passage in the judgment of

Mr Justice Dixon which are preferred set out

and at page 203, about line 21:  Applying those words to the position of

Ditchfield leads, in my view, to only one possible conclusion, namely that Ditchfield's

work for TSA is not within the exception.

This follows from the inferential evidence that

Ditchfield worked full time for TSA and the

absence of any evidence that he did any sort of

work for anyone else or held himself out as

available to work for anyone else. The fact, if

it be a fact, that Ditchfield regards himself as

a self employed person is beside the point.

C2Tl4/2/LW	23	4/5/90
Accident(2)

MR LARKINS (continuing):  The only reason I would refer to

that in any detail is the fact that in the

Full Court, when referring to Ditchfield,

in the joint judgment at page 217 at line 8

in the short summary of facts:

Ditchfield is a qualified scaffolder

carrying on business under his own name.

He normally provides certain scaffolding

equipment. 'In April 1987 he worked

solely on jobs provided through T.S.A.

He worked 181 hours in four weeks. He

arranges his own personal accident

insurance and regards himself as a

self-employed person.

The court really did not consider the matter in any

detail because they never went on in the case of
Ditchfield or Alexander to consider the applicability
of the exception in section 8, and that passage,
to the extent that it might be thought to support a

conclusion that Ditchfield fell within the exception

does not meet the findings of Mr Justice Gray,
in our respectful submission, which would be preferred.

My junior is reminding me, if the Court pleases, that in the HUMBERSTONE case Chief Justice Latham,

when he made the observation, was really just

considering the matter generally. He certainly did

not have in mind a case such as the present and he
certainly did not develop any reasoning with respect

to the applicability of the words "to a circumstance

such as the present". It is no doubt true that

normally and in the general way the work is carried out for a principal. In our respectful submission,

it really does depend on how you characterize the work,

whether it is physical work or whether it is work

which enables the earning by the principal of a fee.

In our respectful submission, we turn next

under section 8 to the case of Paterson. Paterson

was a partner. We do in our outline suggest a

possibility of an argument that, although he was

carrying on a trade, the attendance by him under

agreements with Troubleshooters was not incidental to
his business as a builder really being used to fill in
the blank spots, as one might say, that the undertaking

of a fill-in job by an unemployed barrister as a law

reporter might not be incidental to his trade or

calling as a barrister. My learned friend has

sub voce reminded me, and we acknowledge that no leave

has been granted in respect of that aspect of the

matter, nor do we wish to trouble the Court with it.

We have simply opened the question to leave it as

an open question that in certain circumstances,

notwithstanding that a person does have an established

trade or business and would, prima facie, fall within

C2T15/1/HS	24	4/5/90
Accident(2)

that sort of exception, if you look at the disparity

between the type of work being undertaken for the supposed principal, and the general content of his

trade or business, you might say that it is not work

which is incidental to that trade or business, but,

as my learned friend reminds me, and I acknowledge,

that is not an issue before this Court.

MASON CJ:	No, it is not included in the grounds of appeal.
MR LARKINS:	No, but we did not want it to pass by entirely

unnoticed. Then, if we turn to the case of Paterson and to Clancey, it is necessary to look to section 9

which is a section which has caused the Full Court

considerable trouble and one can see why. On the

other hand, in our respectful submission, the solution

to the matter is to adhere to the words of the section,
rather than to introduce again glosses which are not

apparent from the face of the section, and what we have

done and think - - -

MASON CJ:  Can you shortly state why you think the Full Court

is wrong in the interpretation it gave to section 9?

MR LARKINS:	Well, it did not look at section 9(1)(b) at all.
McHUGH J:	lt did.
MASON CJ:	It did.  It referred on a number of occasions to

section 9 ( 1) ( b) .

MR LARKINS: 

No, with respect, the Full Court did not consider

in the case of Paterson and Clancey the application
of section 9(1)(b).

(Continued on page 26)

ClT15/2/HS	25	4/5/90
Accident(2)

MR LARKINS (continuing):  What it looked at is section 9(l)(a)

and has not addressed the question of section

9(l)(b) at all which we submit is the appropriate

heading. What we submit, if the Court pleases,

is that this is a contract which falls exactly

under section 9(l)(b) and could I just take the

Court to our analysis of section 9 contained in

the document I have described as a flow chart.

There seem to us, with respect, to be four

possiblities as to the relevant contract. One

between TSA and the tradesmen, the second

between the TSA and the builder, thirdly, between in

the particular case of TSA and the company which
provides the services of the workmen - that is

Clancey's company - and fourthly, the tradesmen and

the builder. If one then turns to section 9,
looked at generally, under section 9(1) the question

is whether a person supplies to another person

services concerning the performance of work by a

third person. So that if you go to the section that says:

A reference to a relevant contract in

relation to a financial year is a reference
to a contract under which a person during

that financial year, in the course of a

business carried on by that person -

(a) supplies to another person services for

or in relation to the performance of work -

and it may be that it is a question of whether that

work has to be performed by the person whose services

are supplied or some other - I withdraw that - whether

that work has to be performed by somebody other than

the person supplying the service.

Then, under section 9(l)(b), there is the:

contract under which a person during that

financial year, in the course of a business

carried on by that person -

has supplied to him -

(b) ..... services of persons for or in

relation to the performance of work.

Then, you can look to the question of employer and

worker under those two different classes of cases

under paragraphs (a) and (b). That makes more sense

once you start looking at a particular contract, as

we suggest. Ln relation to the first contract between

TSA and the tradesmen and in the present case there

is no question, in our respectful submission, that

in the financial year that TSA, in the course of a business

carried on by TSA,- now the question is whether the

C2Tl6/l/JH	26	4/5/90
Accident(2)

tradesmen supplies to TSA services concerning the

performance of work by the tradesme~ and we say that
he does, so that it is a section 9(1)(a) case

and the respondent, TSA, has supplied to it

services by the tradesmen, services of a person

concerning the performance of work by the tradesmen.

DAWSON .J:  Why do you have X and C, they are the one

person?

MR LARKINS:	I beg your pardon?
DAWSON J:	TSA has supplied to it - by whom?
MR LARKINS:	By the tradesmen.
DAWSON J:	Services - - -

MR LARKINS:  Of persons. The services are personal services

provided to TSA.

DAWSON J:  Of Ditchfield ·

(Continued on page 28)

C2T16/2/JH	27	4/5/90
Accident(2)

MR LARKINS:  Well, Ditchfield supplies Ditchficld's services

to A concerning th~ performance of work by

Ditchfield.

DAWSON J:  By Ditchfield, yes.

MR LARKINS:  Yes. So, this falls under both 9(1)(a) because

Ditchfield supplies to TSA services concerning the

performance of work by DitchfiPld

DAWSON J: Well, it should not be X and.C: it is by X, then.

MR LARKINS:  I am sorry, are we looking at the same page?

DAWSON J: I am looking at your flow chart.

MR LARKINS:  Yes. Well, you are loo:cing at the first page;

I am sorry, I had turned over to the second page

to look to the particular application.

MASON CJ:	I must say, I find the flow chart almost as incomprehensible as the section itself.
MR LARKINS:	Could I say I am very disappointed to hear that,

Your Honour. If we put a name in it and if we

turn to the one which is"Flowchart ( 1 )'\ this is

contract 1, "Respondent - Tradesman Contract"
shown on the top left, the second of the flow charts
but it is called "Section 9 Flowchart (l)" at the

top.

MASON CJ: Yes. Well, I have that page now.

MR LARKINS: It is the "Respondent - Tradesman" - now, we

say that if you look at that "Respondent - Tradesman

Contract" - can we just leave off the prefatory words because it is a contract in a financial

year, a reference to "a contract under which a

person during that financial year in the course

of a business carried on by that person" so that

in a financial year, in the course of a business

carried on by the tradesman, the tradesman supplies

to TSA services concerning the performance of work

by the tradesman; that is to say, Ditchfield, in

the course of a financial year, during the course

of a business conducted by Ditchfield - no, I

should not use Ditchfield because he is one of the

ones who is not carrying on - Paterson.

MASON CJ: Paterson.

MR LARKINS: Paterson; during the course of a business carried

on by Paterson during a financial year supplies

to TSA services concerning the performance of work

by Paterson; so it falls under 9(1)(a), we would say.

C2Tl7/l/SH	28	4/5/90
Accident(2)

Looked at from the obverse, the same contract,

during that financial year equally TSA, in the course
of a business carried on by TSA, has supplied to it

by Paterson services of work concerning the

performance of work by Paterson.

Now, what the Full Court seemed to require is that the same person could not both supply the services

and perform the work and our submission is there is

simply no justification for introducing that sort of

notion and, indeed, it was the notion which was

rejected, although for reasons which remain obscure,

in the judgment of Mr Justice Murphy in the earlier

MAYNE NICKLESS case. But, looked at in the simplest

way and the correct way, we would submit, is that

if you look at this analysis of the

respondent-tradesman contract, on the one hand

under section 9(l)(a), it is a contract under which

the tradesman, Paterson, supplies to TSA ~ervices
concerning the performance of work by the tradesman
and, at the same time, TSA, in the course of a business
conducted by it has supplied to it by Paterson services

of persons concerning the performance of work by

Paterson.

Now, we have two possible reasons why the same

contract, looked at from both sides, is a relevant

contract under that contract. Next required to

determine who the employer might be and if we

turn to section 9(2), that provides that:

For the purposes of this Act -

(a) a person -

(i) who during a financial year under a

relevant contract supplies services to another

person -

the tradesman, Paterson, in that financial year -

under a relevant contract supplies services

to -

the respondent so that under that contract up to that
point the tradesman is employer because he is the

person supplying services in the course of his

business to TSA.

(Continued on page 30)

C2Tl7/2/SH	29	4/5/90
Accident(2)

MR LARKINS (continuing): But also, the respondent, TSA,

under a relevant contract - that is the contract

under 9(1)(b) - has supplied to it services of

persons - Paterson - concerning the performance

of work by Paterson. Therefore, the respondent,

TSA, is the employer. Thus under the same

contract looked at from the two sides there are

two employers.	However, by section 9(3), it
provides that:

Where a contract is a relevant contract

pursuant to both sub-sections (l)(a) and (b) -

which is this case -

(a) a person to whom, under the contract, the

services of persons are supplied for or in

relation to the performance of work shall

be deemed to be an employer; and

(b) notwithstanding sub-section 2(a)(i) the

person who under the contract supplies the

services shall not be deemed to be an employer.

So that the employer is the person who takes the

benefit of the services not the person who supplies

them. Hence, the apparent absurdity of there being two

employers is resolved and the employer is the person

who is taking the benefit of the service, namely

the respondent, TSA. And the worker under that

contract, if there has to be one, is to be found

as a result of the application of section 2(b)(i):

a person who during a financial year -

(i) performs work for or in relation to which

services are supplied to another person under

a relevant contract .....

shall be deemed to be a worker -

so that the tradesman performing the work, Paterson,

concerning the services supplied to the respondent

under the relevant contrac~ is the worker. And

his remuneration is defined in section 9(2)(c)

as being the amounts:

payable by an employer during a financial
year for or in relation to the performance

of work relating to a relevant contract .....

shall be deemed to be remuneration -

and then there is a provision for reduction to

allow for the fact that the worker so deemed may

be supplying tools and so on for which he is

separately remunerated and which is not subject

to levy.

C2Tl 8/1 /ND	30	4/5/90
Accident(2)

In our respectful submission, that is the

application of the words of the section without

glosses and without fancy work to the particulars

of an actual case. That is to say that Paterson's

contract with TSA analyses out in this say which

leads to the conclusion that TSA is an employer

and the remuneration payable under that is

remuneration under the Act subject to levy.

What answer is there to all this? The judgments

in the MAYNE NICKLESS case rather suggest, for
about seven-eighths of their length, that the
requirement is that there should be a tripartite
arrangement in all cases, that there is a person

supplying the service of supplying the worker,

that it is not appropriately applied - or the

provisions of the Act are not appropriately applied

where there is simply two people, a person supplying
the work - or performing the work and the person
benefiting from it or having the benefit of the

supply of that work and the Full Court seemed to

try and draw some distinction between labour-

supplying services and work-performing services.

In our respectful submission, there is no

warrant in the Act whatever for anything of that

sort and that one simply looks at the Act, analyses

it out and once you apply it to a particular case

there is no particular difficulty otherwise than

one which arises as a consequence of the imposition

of notions which are not there.

If one then turns to the next possible relevant contract on the page which is headed,

"Section 9 Flowchart 2. Respondent - Builder

Contract'', during' the relevant period the respondent,

TSA, in the course of its business, and so on,

supplies to the builder services concerning the

performance of the work by the tradesman; it

certainly provides a service by arranging that

the tradesman, Paterson, should attend and the

builder has supplied to it, by the respondent,	during the financial year in the course of its
business, services of persons concerning the
performance of work. The builder has supplied
to it the services of Paterson concerning the performance of work.

(Continued on page 32)

C2Tl8/2/ND	4/5/90
Accident(2)

MR LARKINS (continuing):  Under that contract the employer,

the respondent TSA under the relevant contract,

supplies services to the builder and under

9(2)(a)(ii) the builder:

under a relevant contract -

has supplied to it -

services of persons -

concerning the -

performance of work -

and those persons,Paterson. Therefore the builder
is the employer and the tradesman who performs
the work is the worker and on that relevant

contract the builder is the employer, the tradesman is

still the worker. The consequence of that is that

simultaneously under the provisions of the Act there are two relevant contracts and there are two sets of lev-iable remuneration, but section 9 ( 5) provides

that:

Where, in respect of a payment for or in relation to the performance of work that is

deemed to be remuneration under this section,

a levy is paid by a person deemed under this

section to be an employer -

(a)	no other person shall be liable to a levy in respect to that payment; and
(b)	where another person is liable to make a
payment for or in relation to that work, that person shall not be liable to a levy
in respect of that payment unless it or the payment by the first-mentioned person

and so on. But the section itself contemplates or indirectly of avoiding -is made with an intention either directly

this exact possibility, namely that there are two

contracts, each of which is a relevant contract;

each of which has a separate employer liable to

pay levy in respect of the remuneration under its

respective contract and we do not shy from the fact

that it is also the case in the application of this

Act that the respondent builder contract is also

a relevant contract. Now, Mr Justice Murphy, in
the MAYNE NICKLESS case, made some, what we would

respectfully say were gratuitous observations about the

facts of the case which was not then before him,

namely the very case that we are now concerned with,

and saying that he would prefer to identify the

C2Tl9/l/CM	32
Accident(2)

relevant contract as that between respondent and

the builder. In our respectful reason, there is

no basis for preferring one application of the Act

to the other and if they can both be made

contemporaneously, the fact that one leads to a
result that the respondent is liable to be assessed
in respect to remuneration paid and the other
leads to the result that a builder is liable to
be assessed, is just a consequence of the

provisions of the Act.

DAWSON J:	How do you determine which pays first and thereby
relieves the other of liability?

MR LARKINS: Well it is a matter for our assessment, if the

Court pleases.

MASON CJ: Well, it depends on whom you assess first.

MR LARKINS:  Yes and it is a very practical matter. It is a

good deal easier.

MASON CJ:  I am sure it is to those who pay.

MR LARKINS:  Yes. There is a very practical problem involved

in all this and one of the matters which may

untimately determine the matter is that if you

look at the exceptions which the Court really is not

concerned with in this case, it might well be that

the exceptions are much more appropriate to a

builder. For example, there is an exception that if

the person is required for less than 90 days in

any given year, to distinguish out the case of the

genuine subcontractor, and it might well be the

case that in any given year that it is unlikely that

any particular builder would require the services of

a particular employee or tradesman, so that the

probabilities are extremely high that, although

that,!as a theoretical basis the relevant contract

could be between the builder and the respondent

under whifh the builder is the person that you would

expect to be assessed, the probabilities are

extremely high that one or other of the exceptions

will apply in his case, leaving the only assessible

employer, in fact, the person to whom the services are

provided under our first version, under the contract

between the tradesman and Troubleshooters.

(Continued on page 34)

C2Tl9/2/CM	33
Accident(2)

MASON CJ:  Where do we find the MAYNE NICKLESS case, by

the way?

MR LARKINS:  The MAYNE NICKLESS case is reported now in

(1989) VR 878. I do not, if I may say so, wish to

read the decision or take the Court to it in any detail

except to highlight that on page 889 at line 41

His Honour said:

These considerations lead me to conclude that unless one of the exceptions applies, s.9(l)(b)

of the Act operates in the present case to

make the contract which Mackintosh had at the

time with Sea Pak a "relevant contract", and
to make Sea Pak an employer under s.9(2)(a)(ii)

and Mackintosh a worker under s.9(2)(b)(i).

That was the	sort of ultimate conclusion, if I can put
it that way.	The reasoning, we would submit, read
fairly up to	that point, really goes exactly the other
way and that	if, for example, one looks at page 888
at line 16:

What then does the expression "services of persons" which appears in s.9(l)(b), (2)(a)(ii)

and (3)(a) mean? Clearly it does not mean the

services of a prime mover. I think that it

must be intended to apply to a contract whereby

the services of a person (C) are supplied by
the person (B) to the person (A) in the course
of a business carried on by person (A) with
whom the contract is made. Person (B) supplies

the services, person (C) is a worker, and

person (A) is an employer -

which is the tripartite notion and there does not, in

our respectful submission, appear to us to be any

justification in any of the reasoning which there

follows to lead to the conclusion which is expressed

at page 889. Now, it is just a curious case that

when we first read it at this end of the bar table

we thought there is a big problem here and the

ac tua 1 dee is ion is exactly contrary to the case that

we are concerned with, which is to establish that

there can be the provision of services by the person

who actually carries out the work, but then when one

looks at the actual conclusion the court found in
favour of the person who was making a claim under the

provisions of the Act for benefit in that circumstance.

Could I just remind the Court, with respect, that

although, of course, the Court in the present case is

concentrating on the levy aspect, that is to say where

the Act looks for all the world like a taxing

statute, the consequence of a finding that a person

is or is not a worker also has the consequence that

they are or are not entitled to the benefits provided

C2T20/l/HS	34	4/5/90
Accident(2)

for in the Act, so that the Act is, in general terms

a piece of legislation which is beneficial and

although in one sense one might tend to say well,

you favour a view that a person is not a worker for

the purpose of limiting the amount of levy payable,

it must always be remembered that it also has the

side effect that the person concerned, as a person

who is not deemed to be a worker, has no opportunity

to share in the benefits or participate in the rights

which are afforded by the provisions of the Act, and it

has that dual aspect. In our respectful submission,

there is no justification for approaching the Act in
any particular way, bearing in mind that both the

taxing levy aspect is more than counterbalanced by the beneficial aspects of the Act which would tend to encourage the Court, in our respectful submission,

to give it a wider, rather than a narrower, meaning.

Could we then, having established, in our

respectful submission, that there are relevant contracts

under section 9(1) in respect of both the tradesmen

TSA contract and the contract between TSA and the

builder, turn to page 3 of the flow chart looking at

the particular case where a company, Building Design

Concepts in this instance, makes available to the

builder ultimately, and to TSA, the services of its

main mover, Mr Clancey.

(Continued on page 36)

C2T20/2/HS	35	4/5/90
Accident(2)

MR LARKINS (continuing):  Under section 9(1), BDC, the

company, in the course of the financial year
and in the course of a business carried on by

it supplies to TSA services concerning the

performance of work by Clancey, TSA has

supplied to it by BDC services of persons concerning

the performance of work by Clancey, and then

BDC under the relevant contract supplies services

to the respondent, TSA, and the respondent under
a relevant contract has supplied to it services

of persons concerning the performance of work

by BDC or perhaps Clancey.

On that view, because of the provisions of section 9(3) TSA is the employer and Clancey is the

worker because he performs the work concerning the

services supplied to TSA under the relevant

contract and the remuneration is fixed. And

really there is no distinction between the position

where the company is interposed and the work is

performed by, in the case of Paterson, a person who

conducts his own business.

The other possibility is that tradesman/builder

contract under which the tradesman supplies to
the builder services for the performance of the

work by the tradesman but, i1'1 our respectful submission, the

prefatory words of the Act,· that it.is in the course

of the business carried on by the person; has to

supply to another persons under a contract, and in
our respectful submission there is no contract

in fact. We have included this only for the sake of completeness and on the view of that, if there

were a contract, there would be no doubt that the

builder was the employer. Our respectful

submission is that there is nothing in any of the

materials which at any time has supported the view

that there is, in fact, any relevant contract between

the tradesman and the builder.	The builder is not
obliged to pay the tradesman anything.	The
tradesman is required to carry out the directions of

the builder but as a result of his arrangements

with Troubleshooters.

Our submission is that the provisions of the

Act are wide. They have to be given proper

operation and we have provided examples in the flow

charts of the way in which the words of the section

apply appropriately to the legislation. The

reasoning of the Full Court, in our respectful

submission, simply does not meet the words of the

section. It seems to us, with respect, extremely

difficult to follow,if you look at it in any detail,

of what the - - -

C2T21/l/LW	36	4/5/90
Accident(2)

MASON CJ: Just before you go to it, could I take you back

to the second page of the flow chart document,

the one that has (1) above it. If you look at

l(a) in the first section there, what are the
services that Paterson is supplying to TSA for
or in relation to the performance of work which

Paterson is performing?

MR LARKINS:	The services which he provides to TSA are attendance at site; the provision of tools to
allow him to do that - there is a good deal of material
about that in the evidence; and once he is on
site he is serving TSA by complying with the
directions of the builder and thereby enabling TSA to perform its function of providing a ready,
willing and able workman to perform work as
directed.
MASON CJ:	And all that is in relation to work which he is

contractually bound to perform for TSA?

MR LARKINS:  Yes, Your Honour. TSA is obviously not on site

and it is obviously not telling him to	hammer that
nail into that piece of wood. That is	clear.
But it is really the same case that if	I - nerhans .. .
it is better not to confuse.

(Continued on page 38)

C2T21/2/LW	37	4/5/90
Accident(2)

MR LARKINS (continuing):  The obligation of TSA is to provide,

and has agreed to provide, a man who is capable of

doing that and when he is there, a good, willing and

obedient. man on site. When Paterson, as it were,

goes there, carries out those functions, he is

advancing the work of the builder and of the

interests of the property owner but he is doing those

things which entitle TSA to say, "I have performed

my obligation to you, Mr Builder, in providing a

suitable man to carry out your work", and I was

stopped before by saying, and thereby TSA to

say, "Well, I'm thereby entitled to remuneration".

But if you look strictly at the position between

TSA and the tradesmen, the position is that the

tradesman is performing TSA's obligation in relation
to performance of work by attending and to carrying

out as directed the various tasks on site. It seems

to us, with respect, that again it is a question of

characterization similarly to the work in section 8.

The performance of work has many aspects ..

Do you say that the plumber who puts in my drains is performing the work when he did not do anything other

than sit in his office, ring up on his telephone

and tell his employee, Bloggs, to go out and do the

drainage work? The plumber is performing the work,

notwithstanding that he has not dug a hole or laid a pipe.

It is one of those cases which, since vou would

look at the section, and at one level .there is a

lot of confusion introduced by the way in which it
is formulated, but when you try and apply it to

particular cases, in our respectful submission, the
results are clear and there are two relevant contracts
in the context of the present case: one between the

builder and the respondent and the other between the

respondent and the tradesmen.

BRENNAN J:	Why is it that in section there is a reference to "perform any work" and in section 9, there is
supply of services:

for or in relation to the performance of

work?

The supply of services seems to be a new concept in

section 9, does it not?

MR LARKINS:  Yes, it does. Section 9, if one does look at

the extrinsic material, certainly seems to have been

particularly drafted with an intention of dealing

with employment agency-type cases, the provision

of services. But, in our respectful submission, it

is wider than that and there is no reason to limit its

application by reference to any other provision, say,

in section 8 or otherwise.

C2T22/l/JH	38	4/5/90
Accident(2)

MASON CJ:  But, it is just a little odd, is it not, that

the section should be directing its attention to

the supply of services:

for or in relation to the performance of

work -

where, in effect, the provision of the services is

part of the performance of the work covered by the

one contract? One would think, looking at a provision

like this, that the section was directing its

attention to the provision of services by (a):

for or in relation to the performance of

work -

by (b) .

MR LARKINS:  All I can say is, I hear what Your Honour

says but it does not say that, in our respectful

submission.

MASON CJ:  It does not say that in terms but when one sees

a provision of this kind, one looks at it as if that

were the target of the provision. I know your answer

to it is to say, well, possibly that is the primary
target, but that does not prevent the words from

having an additional coverage as well.

MR LARKINS:  Could I just, without directly answering that,

take Your Honours and remind the Court that there is

a provision in section 9(6) which in the section,

paragraph (b) :

a reference to supply includes a reference

to supply by way of sale -

et cetera. And, in realtion to services:

includes a reference to the providing,

granting or conferring of services.

And, paragraph (d):

a reference to services includes a reference
to results (whether goods or services)
of work performed.

I do not know exactly which direction that takes it, but I just draw attention to those provisions. In

our respectful submission, although one can accept

that:

servi-ees for or iµ relaticn tn the perforrn:mce of work -

rra.y apply and perhaps even principally apply to the sort of

baby-sitting type cases where there is a provision by an ernployrrent

agent of services of another person concerning perfonnance of work,

we simply submit that there· is no reason to give section 9

otherwise than its wide operation.

C2T22/2/JH	39	4/5/90
Accident(2)

MR LARKINS (continuing): And, indeed, ultimately, that is

what happened in the Full Court in the SEA-PAK

case notwithstanding the reasoning and our

respectful submission is that one looks at the

words of the section, applies them to the facts,

and that is exactly what we have done in the

flow charts and the fact that - as one can find

in the extrinsic material - the principal target
in the sense seems to have been the employment

agent type cases where there is a tripartite

arrangemen~ it is by no means limited to that,

in our respectful submission.

MASON CJ:	What is the reference to the SEA-PAK case?
MR LARKINS:	That is another description of the MAYNE

NICKLESS case which Your Honour already has.

MASON CJ: 

I see.

MR LARKINS: 

MAYNE NICKLESS (TRADING AS SEA-PAK), I beg your pardon.

BRENNAN J: 

It may be that the words "services ..... for or

in relation to the performance of work" are needed
to distinguish the case from those which fall under

section 8 where the work is being done by the

person who is contracted to do it?

MR LARKINS: Really, my junior is reminding me that the

point I was obliquely making before, the history

of the sections really cannot support any

conclusion drawn on the basis of looking at what

is in section 8 and section 9 because section 8

has been there for a long time, since 1946 in the

Victorian WORKERS COMPENSATION ACT. Section 9

found its genesis in the PAY-ROLL TAX ACT at some

stage prior to 1985 and it was then translated

into this new Act of the ACCIDENT	COMPENSATION
ACT in 1985.	So they have quite disparate sources
and it really is not a rewarding exercise to try

and draw any conclusion, in our respectful

submission, because of the legislative history

of the two provisions.

I was proposing then to take the Court shortly

to the actual decision of the Full Court in the

present case.	The judgment is to be found at
page 214 of the book.	The judgment commenced at

page 214 and the court sets out the facts and I

will not trouble the Court with the facts.

Following the facts are the relevant statutory

provisions and one turns to the bottom of page 225,

line 40:

For the appellant, it is argued that

s 8 applies only to contracts under or by

C2T23 /1 /ND	40	4/5/90
Accident(2)

which a contractor agrees to perform any

work for another person in the sense that

the other person is the direct beneficiary

of the work; that neither Ditchfield nor

Alexander performed work for TSA but for

builders obtained through TSA. In any event,

the exclusion ins 8(l)(a) is applicable

because the work they performed was work

incidental to a trade or business regularly

carried on by them. As to his Honour's

finding in relation to s 9 of the Act it was

contended that there was no "relevant contract"

between TSA and the contractors as required
by that section, that the only relevant

contracts were those between TSA and the

builders.

(Continued on page 42)

C2T23/2/ND	41	4/5/90
Accident(2)

MR LARKINS (continuing):

For the respondent is is argued that there

were contracts between Ditchfield and Alexander on the one hand, and T.S.A. on the other, under or by which Ditchfield and Alexander agreed

to perform work for T.S.A. in that on a

particular day or days they would work for

a client of T.S.A. and T.S.A. would pay them

at the rate prevailing for that work from

time to time; that work performed by

Ditchfield and Alexander (being the work for

T.S.A.) was not work incidental to a trade -

and so on.

As to section 9 of the Act is is contended

that the contracts between T.S.A. and the
contractors are "relevant contracts" within
the meaning of the section and that T.S.A.

is liable to pay the workcare levy accordingly.

And they deal firstly with the section 8 argument.

Section 8(1) is substantially a reproduction

of section 3(6) of the WORKERS' COMPENSATION ACT

1928, first introduced in 1946 by Act No. 5128.

In HUMBERSTONE V NORTHERN TIMBER MILLS (1949)

79 CLR 389 at page 397 Chief Justice Latham said:-

"The idea of this provision(section 3(6))
is evidently to extend the benefits of
the Act to persons who agree to do work
which is not work belonging to a trade or

business carried on by them, even though

they may regularly carry on a trade or

business. In the first place, there must
be an agreement by B (a contractor) to
perform some work for A (a principal) ...... "

It is the last proposition which Mr Larkins Q.C.

for the respondent contends does not

necessarily flow from section 8(1), the

relevant words being the same as those considered

in HUMBERSTONE.

It is true that Chief Justice Latham

MASON CJ:	I do not think that there is any need to read considerable passages from the judgment Mr Larkins. We have read the judgment for ourselves, but if there are particular points you want to make about
the judgment, by all means do so.
C2T24/l/CM	42
Accident(2)

MR LARKINS:  Well the Court then rejected my arguments

holding that the work had to be performed for

the benefit of the person concerned and,in our

respectful submission, there is no basis for that

and then they turn to section 9 of the Act at

page 232 and distinguished at line 10,or said:

The person who supplies the service of

"supplying" the worker is ordinarily, one

would expect a different person from the

worker. This was not so in MAYNE NICKLESS LTD.

(SEA-PAK TRANSPORT SERVICES) V MACKINTOSH ..... It

seems that the Court there acted on the facts

and "the work11 were supplied and performed by	found by the Tribunal that the "supplying" services
the same person and then only under section 9(l)(b).

And then we would find difficulty and I would say,

Your Honours, that we do not attempt to expound

their reasons, because we find them difficult to

understand and simply stress that the approach

which is there taken, in our respectful submission,

is not one which is justified by the words of

the section, but seems to follow on from the bulk

of the reasoning of Mr Justice Murphy but somehow

overcome the effect of the change of tack which,

we submit, occurred right at the end of His Honour's

judgment and, in our respectful submission, the
reasoning of the Court introduces the notion that
there must be a tripartite arrangement which is,

in our submission, not supported by the Act and it

overlooks entirely the provisions of section 9(l)(b).

It simply does not deal with the 9(l)(b) aspect of the case.

Could I just make a couple of other observations?At

various points it is submitted that there cannot be a

deemed employer without a deemed worker and,in

our respectful submission, the Act can deem anything

to be anything, that you can have 15 deemed
employers and no deemed workers.	The problem though

is not that aspect of the matter, but in such a

case it is not possible under the Act to identify

any remuneration paid, so that if the same person -

take one particular analysis -both worker and employer,

it is not that they cannot be deemed at the same

time to be both employer and employer, the legislature
can deem black to be white and it can deem them to

be simulteneously black and white, in our respectful

submission. They can deem whatever it likes, but

it does not help us at that point because although

that line of reasoning, in our respectful submission,

is fallacious, we cannot overcome the next step in

the problem that there is no identifiable remuneration

paid by an employer to an employee, because,

obviously enough, if you have two employers and no

employee,	there carmot be a remuneration paid from one to the other,
so that	line of argument is available perhaps.

C2T24/2/CM	~3
Accident(2)

M R LARKINS ( cont in u in g ) : In s i t u a t i on s 1 i k e th i s , i t i s

very difficult to know what I can do otherwise

than just correct one thing my learned iunior

me, Mr Justice Dawson raised the question about

why did we put Con the - - -

DAWSON J:	I was looking at the wrong page though.
MR LARKINS:	Pardon?
DAWSON J:	I was looking at the wrong page but, perhaps - - -
MR LARKINS:	Yes, but still it was a very legitimate question

because why did we put C there and the reason . . '

I am reminded, 1s that we wanted to stress that that

was what, really, the Full Court was saying: that
there had to be a third person, C, who was providing

the service to contrast with what we were saying;

that the true position is that there is no

requirement in the Act, as we would submit, that

there should be a tripartite arrangement and,

therefore, we would rely on the actual decision

of the Full Court in the MAYNE NICKLESS case,

although not the reasoning and we would, in our

submission, be entitled to ultimately an order, if the

appeal were allowed, simply to restore the order

of Mr Justice Gray at first instance would deal

with the case. The parties have, following

Mr Justice Gray's decision, actually negotiated

and the consequence was the formal order which
His Honour made was one which, if not as to the

liability, at least as to amount, as a result of the discussion between the parties so there is no problem about the actual quantification of the

matter, if we should be successful, it is simply a question of restoring Mr Justice Gray's order. If the Court pleases, unless there is some matter

the Court may wish to put to me, there are no

further submissions I would wish to make.

MASON CJ:  Yes, thank you, Mr Larkins. Yes, Mr Black.

MR BLACK: If the Court pleases. Might I hand to the Court

appropriate copies of an outline of our argument

which we will follow shortly, if we may, with

something that we call analyses A, B, C and D.

MASON CJ:  Yes, a preferable title. Yes, Mr Black.

MR BLACK:	The analysis - I will start with section 8 but
might I, before doing that, simply say this: that
the analyses that we have handed up contains one
more and it is a critical one.  They otherwise
reproduce what our learned friends have put up but
there is one more under the section 9 point and that analysis does, indeed, turn black into white
depending upon which arbitrarily selected starting point
one comes to and when we develop the section 9 argument,.

C2T25/l/SH	44	4/5/90
Accident(2)

we will use that to show that the Full Court's

decision, indeed, has symmetry; it is completely

sound; it makes sense and it does no violence to

the words of the Act. Indeed, the words of the

Act require them but might I start with section 8

and might I start by making the general point that,

in our submission, section 8 with its origins back

in 1946, in the old section 3(6) of the WORKERS

COMPENSATION ACT just after the war, and its

counterparts in other States, was dealing with a

situation which is a far cry from the situation

that emerged in the case of ODCO, a labour agency.

The old section 3(6) or now, the section 8,

was plainly introduced to deal with the situation

such as occurred to the unhappy Mr Humberstone,

who died too early to obtain its benefits; who

was working for a firm for years and years and years
to all intents and purposes as if he were an employee

and he, under the old law, because of the, perhaps,

on one view - perhaps, no doubt, on the correct view -

the artificiality of the contractual relationship
that had been established between himself and the

person for whom he worked escaped the benefits
of the Act which, it was thought, socially ought to

extend to him.

Now, that type of approach to section 8 was

expressed in HUMBERSTONE itself. W1en HUMBERSTONE

V NORTHERN TIMBER MILLS, (1949) VR 351, was in the

Victorian Full Court, it page 360 of the report,

Mr Justice Fullagar, in delivering his separate

judgment, in about the middle of the page, analysed

the section and said - and we rely on this only as
a matter of judicial impression at the time - at

about point 4 of the page:

I think that it -

that is, the section -

was intended to apply to a case where a person

is, to all intents and purposes, in the position

of an employee, although the provision of plant

and/or other elements in the case prevent the legal character of servant attaching to him -

and His Honour went on to deal with the trade or

business exception and, very recently, in this Court

in a case called BABANIARIS V LUTONY FASHIONS PTY LTD,

(1987) 163 CLR 1 at 19, in the judgment of

Justice Wilson and Your Honour Justice Dawson

reference was made to section 8 as reproducing the

old section 3(6) as extending the Act "to a very

limited class of workers~

C2T25/2/SH	45	4/5/90
Accident(2)

They were of course, however, an important class of

workers, given that workers' compensation legislation

is social legislation.

So, when one looks at the original policy for the section 8 amendment, one finds, in our submission,

that the natural idea emerges that it was intended to

cover people like Mr Humberstone. It had nothing to say about a labour agency situation where the agency

gets work for different people and where the different

people use the labour agency in much the same way as
perhaps less formalized people would use the Yellow

Pages.

(Continued on page 47)

C2T25/3/SH	46	4/5/90
Accident(2)

MR BLACK (continuing):  They work from job to job to job

which they get through the agency. They do not work

for the Northern Timber Mills under the circumstances

described in HUMBERSTONE, for year after - - -

BRENNAN J:  Have we got a common ground, or not, as to the

contractual relationship here?

MR BLACK:  I think almost common - not quite common ground,

Your Honour. We maintain and we say that the evidence

showed quite clearly that the supposed worker need

do no more than turn up at the site with his tools

if, and, of course, only if he had accepted the

telephone call from Troubleshooters to go to the

job. The evidence was quite clear that a supposed

worker, a contractor, having received the call from

Troubleshooters, he being on their list, did not have

to accept the job if he did not want to.	There is
no doubt about that.	There is some, at least,

difference in emphasis as what happened if he said

he would go to the job, and our argument is that

his requirement, having accepted what Your Honour

Justice McHugh has described as "the standing offer",

his requirement then was to turn up for the job with

his tools at the time appointed, and I suppose we

would have to add the gloss with a bona fide intention

of not wasting everyone's time. So that he could not

turn up just for a frolic, to irritate Troubleshooters.

He would have to turn up intending, one would

suppose, that it was a sensible thing that he was

doing. However, once at the job the evidence shows

that he did not have to work for any particular time;

he could stop at any time he liked, or he would leave
whenever the builder told him he did not want him any more, from which we would push it back to say

that theoretically, as a matter of law, he did not
actually, if he did not like the look of the job or
he did not like the foreman or it was wet, or for

whatever reason, he did not actually have to start

work.	Now, if he did not start work, no doubt
Troubleshooters, in its arrangement with the builder,

would then send somebody else who was less sensitive

about the face of the foreman or the clemency of

the weather or the dangers of the site.

BRENNAN J:  Is it common ground that there was no contractual

relationship between the builder and the workman,

but there was a contractual relationship between the

workman and Troubleshooters in cases where the

workman worked and that the payment of the workman's

remuneration became a contractual liability of

Troubleshooters and the doing of work by the workman was in discharge of his obligation to Troubleshooters?

MR BLACK:  Your Honour, it is the last point that I - certainly

all up to the last point that the doing of the work

C2T26/l/HS	47	4/5/90
Accident(2)

by the contractor, supposed worker, was in discharge
of his liability to Troubleshooters. We would say

no to that point because his obligation is to turn

up at the site and if having, as it were, been

offered the brief and seeing the brief he likes it,

then he takes it. If he takes it, then, because of

his relationship with Troubleshooters,he must get

paid ultimately by Troubleshooters for the actual
hours he performs and this is clause 2 of the

agreement to which Your Honour the learned Chief Justice

made reference earlier.

It does not oblige him to do the work, in our

submission. It is conveniently reproduced at page 189
in the judgment of the learned primary judge at the

bottom of the page. It was never contended by

Mr Larkins, or never an issue, that he actually had

to do the work but what, of course, is clear, that if

he does work then he gets a particular agreed price

per hour.

BRENNAN J:  Well, is the point in dispute whether or not the

contract in relation to a specific job was one into

which the workman entered and agreed to perform work?

MR BLACK:  Yes. That was the point of dispute.

BRENNAN J:  Well, if that is the point of dispute, it is a

radically important point and it is factual.

MR BLACK:  Yes, if there are factual points in this case.

BRENNAN J:  And is there any finding upon it?

MR BLACK:  The answer to Your Honour's question is in a way,

but it is not terribly distinct. It is at page 216,

at the top of the page, at about line 5. If I might

for context perhaps go over to page 215. Having

set out the contract - might I, in answering

Your Honour Justice Brennan's question, perhaps

deal with the matter slightly more broadly, but I

will answer it. (Continued on page 49)

C2T26/2/HS	48	4/5/90
Accident(2)

MR BLACK (continuing): If one goes to 214, the nature - in

the middle of the page - of TSA's business is

described as:

providing tradesmen to the building industry.

It has a pool of tradesmen ..... 15 different

categories -

et cetera, and it says at line 23 -the Full Court

says:

in effect a labour agency.

And then the standing offer is referred to and at the bottom of 215, line 48, the following appears:

When a builder needs a particular

contractor or contractors he contacts T.S.A.

and places an order. An employee of T.S.A.

then completes an order sheet recording the

builder's name, the person to whom the
contractor should report at the building site,

the type of contractor required and the

duration of the work. The T.S.A. employee

then contacts an appropriate contractor and
advises the contractor the particulars of the
builder's requirements. If the proposal is
acceptable to the contractor, he attends at
the building site and performs the necessary

work at the direction of the builder.

And then there are the details of how he gets paid.

I should read line 15:

The contractor is paid by T.S.A. at the hourly

r~ee agreed between T.S.A. and the contractor.

The contractor makes no payment to T.S.A. for

having placed him. T.S.A. 's reward comes from

the difference between the rate it charges the
builder and the rate at which it pays the

contractor.

Now those are the findings. In our submission

BRENNAN J:	Well, vx,uld you say this is CAFLILL V CAREONIC SM)KE MIL?
MR BLACK:	Yes.

BRENNAN J: Well, how do we decide that?

MR BLACK:  Your Honour, in so far as there is any criticism

in Your Honour's question, this was just the way it

was run - - -

C2T27/l/LW	49	4/5/90
Accident(2)

BRENNAN J: No, it is not a question of criticism; it is a

question of if there is a finding of fact which is

critical to the operation of section 8 and that

finding of fact has not been made and is not

agreed, how do we determine the case?

MR BLACK:  Your Honour, the evidence was undisputed. There

was affidavit material that was not cross-examined

about and so, therefore, were it necessary to

do so the answer, in our submission, appears as

a matter of necessary inference from very few

passages of evidence. There was no issue of credit

in the case. What happened was that the principal

of TSA swore an affidavit saying what happened and

set out his various flow charts and other data.

The four contractors swore what they did and they

were representative of hundreds of people. If the

case had not been proceeded with in that way it would

have gone for weeks. In fact, I think it took two

days before the primary judge so that the

representative people were selected, we lost,

we appealed and there was argument on appeal which
we won and then, of course, special leave to hear.

That is how it all happened. There was never

any cross-examination, never any dispute as to what

the - no opposing affidavit.

The source of the material, the primary source

of what happened, is in the affidavit of Mr Groves,

and the relevant parts of that are at pages 31 to 33

and particularly at page 33. If I might take the

Court to 32, at about line 14:

A client who wishes to obtain a contract

tradesperson contacts TSA by telephone to place

an order. A TSA employee completes an "order

sheet" which notes the client's name -

et cetera - and that is produced. There is an issue of

confidentiality. At 14:	To match a contractor with a TSA client, a TSA
employee goes through the order sheets and
compares those to further sheets which are kept and called "availability lists". These are
lists which show the names of various contractors -

reading from line 6:

The TSA operator then contacts the relevant

contractor by telephone and advises the details of

the client's requirements and the name of the
contact person ..... Should the particular contractor
contacted accept the offer of work, all that is

required of him is to attend at the relevant

site on the date advised. Should he not wish

to accept the offer of a contract -

C2T27/2/LW	so	4/5/90
Accident(2)

they then, in essence, go down the list. And

then paragraph 15:

Once a contractor accepts an offer of work and attends a client's site, he remains at the

TSA client's site working for as long as that

client requires or for as long as the

contractor wishes. TSA does not exercise -

control, et cetera.

(Continued on page 52)

C2T27/2/LW	51	4/5/90
Accident(2)

MR BLACK (continuing):  There was1 at that stagei an issue

as to whether these peop e were common aw

employees or not and that issue disappeared. There

is a passage to which my learned friend was making

reference and if the Court will pardon me, I will
check it so that I do not leave anything vital out.

At page 41 of the appeal book, paragraph 29:

Where a contractor has agreed to work at

a particular site -

those are the words used -

the contractor does so al the direction

of the person nominated by TSA's client in

its form. The contractor is required to

provide his or her own ..... clothing -

et cetera. There is then discussion about the

people turning up with their tools. That is, in
essence, as we understand it, the state of the
evidence. There is the contract, there is the

discussions in the affidavit as to what actually

happens and we would say the necessary inference from

that is that the contractor does not have to do more
than turn up at the site and, we would add the gloss.
with a reasonable approach of mind to it, so that

he will not reject the work on frivolous grounds,

but nothing happens to him contractually until he

actually decides to do the work. When he does that,

when he says, "Yes, I'll take the job", and might I

say, pare.nthetically, that we say he turns up as
your sturdy, independent tradesman with his bag of

tools, having got the brief through his clerk, as it

were, having turned up at the site with his bag of

tools, if he then decides to work, as he undoubtedly

normally would -because otherwise why bother -

then when he does work there is a contractual

obligation on TSA to pay him the agreed rate per hour
and, of course, a contractual obligation on the

builder to pay TSA the agreed hourly rates including

the minimum hire rates.

TOOHEY J:	Mr Black, where is the standing offer in the description that you have just given us?
MR BLACK:	The standing offer is the contract that the -

perhaps I might have too readily agreed with calling it a

standing - it is a standing form of contract.

TOOHEY J:	Yes, I understand that.
MR BLACK:	Standing terms.
TOOHEY J:	Yes.

C2T28/l/JH	52	4/5/90
Accident(2)

MR BLACK:  Now~ that, Your Honour, is the document that is

reproauced at page 189.

TOOHEY J:	It is a record of the terms upon which parties contract, if they contract.
MR BLACK:	Yes, that is right and, indeed, there is no

obligation on Troubleshooters to ring the man

any more than there is on a barrister's clerk to

ring a particular barrister. One would expect

it would in the ordinary course of its business.

McHUGH J:  Nor is there any obligation on him to accept any

work.

MR BLACK:  Exactly, that is right. If they think he is a

good man that would suit their client, no doubt,

they would ring him. If he likes the idea of the job and it is not a good fishing day, or he wants

a lot of monev that week, or for whatever reason,

whatever idiosyncratic reason of his own, he will say,

"Yes, I'll go", and he turns up with his bag of tools.

McHUGH J:  And the rate itself would vary from time to time

and presumably be revealed in the telephone

conversation?

MR BLACK:	Yes.
MASON CJ:	What I do not understand at the moment is, if you

look at page 33, the passage that you read out

to us, why do you not look at it as the offer of a

job when the telephone call is made and an

acceptance of that offer at that time? Now the

consequences of that acceptance may give rise to

another problem but why is that not the position?

There is an offer made then and an acceptance at

that time?

MR BLACK:  I do not r,esist that, Your Honour. It is the

consequence of it; the terms that are then embodied

that may be critical. They may not be, either.

They were not regarded as such in the Full Court but,
in so far as they are critical, we say that the
service - if it be properly characterized as a

service - that the man then undertakes having said,

"Yes, I'll go to the site" - - -

MASON CJ:	Yes, Black Acre?
MR BLACK~	Black Acre.  The service that he then provides is

to turn up at the site with his tools; his dumpy

levels and so forth, and I would concede, an

enthusiastic frame of mind so that he will not just

waste everybody's time, but that is it.

C2T28/2/JH	53	4/5/90
Accident ( 2)

BRENNAN J: It is no more than saying, "I'll think about

it on the site tomorrow morning"?

MR BLACK: No, Your Honour. It is, with respect, more than

that. It is that he will go to the site. That

is what he says he will do. But when he goes to

the site he is not irrevocably bound to take the
job if he does not want it. But, no doubt, he

normally would take the site. That is why I must

introduce - and not by way of concession but by

way of, I would submit, sense - the implied

obligation to turn up in a workmanlike frame of

mind. But bearing in mind the industry it is it

would require, in our submission, something
express for a contractor to turn up on a job by

telephone and bind himself to actually do the job

because building sites and works are many and various

so it could well be that he turns up on the si~e

and there is the foreman with the flaming red beard

that he had a fight with last week or there is

the safety issue that he did not like last week

and this man holds himself out to be an independent

contractor. That is what they all say they are.

We say that is legally correct but that is another

issue.

So that is the way we would put it,

Your Honour, and the evidence, in our submission,

compels that finding and if it is critical that

is what we say the finding should be.

DAWSON J:  I am not at all sure why you say the obligation

is confined to going to the site ready, willing

and able.

MR BLACK:  The reason we say so, Your Honour, is that,

perhaps unnecessarily, we are tender of the notion

that the service extends to the actual hammering

of the nails. As we understood my learned friend

Mr Larkins' statement earlier in the piece it is

not suggested that the men provide a service to
Troubleshooters in hammering the nails.	In so

far as he says that they provide a service in
going to the site we accept that that is what they
are required to do although we deny it is

categorization as a service for the purposes of section 9 but we are tender, in a precautionary

sense, of saying that they have an obligation to

actually hammer the nails and that that is a

service rendered to TSA.

DAWSON J;	They agree to carry out all the work that that agree to do, that is clause 7 of the agreement.
MR BLACK;	Yes, Your Honour, but that "they agreed to do".

C2T29/1/ND	54	4/5/90
Accident(2)

McHUGH J:  How does that stand with page 33 of the record,

line 24, where it says:

Once a contractor accepts an offer of work

..... he remains ..... working for as long as

that client requires or for as long as the

contractor wishes.

MR BLACK:  Or for as long as he wishes.

McHUGH J: If he can go on the site and after five minutes

he says, "I've had enough, I'm going home", and

that constitutes no breach of his agreement with

Troubleshooters, why cannot he change his mind

after the phone call and say, "Well, I'm not going

to go at all"?

MR BLACK:  Your Honour, logically, that is right. One would

expect him not to but, logically, that would follow.

BRENNAN J:  The contract- is.illusory then if that answer

is right?

MR BLACK:  Yes. The contract - it is illusory in the sense

that it is devoid of binding obligation until the

man goes to the site as one would expect that he
would and does the work, in which case then he

has to be paid by Troubleshooters.

Mc HUGH J:  It rather struck me that it is a contract which is

performed only by him actually doing the work.

MR BLACK: Actually being on the site, accepting the work

that the foreman tells him he wants him to do and

then, of course, he gets paid for it.

McHUGH J: And that is why I was wondering whether or not it

could be said within the meaning of section 8(1)(a)

that it was a contract under which he agreed to

perform work?

MR BLACK:  We say it was not.

McHUGH J:	No, I understand that.
MR BLACK:	So he does not agree to actually do any work,

as between Troubleshooters.

(Continued on page56)

C2T29/2/ND	55	4/5/90
Accident(2)

McHUGH J:	Yes.
MR BLACK:	Once he is at the site and he has done what you would expect him to do, he has taken out his truck
and his tools and he has gone there, sees the foreman, and he says, "Hello, Joe. Yes, this is the job today,
fine. Where do we start?", then the Troubleshooters' standing terms will take over and may require him to
do that job in a particular way and certainly will
require him to be paid.

DAWSON J:  That is not what clause 7 says. If, under clause 7

he is rung up and he said, "Yes, I will go out to

builder A and do the job", then he is bound to do it

by the standing terms that become the terms of the

contract at that point with Troubleshooters.

MR BLACK:  Yes, but Your Honour, with respect, that does not

negate the point that Justice McHugh was making with

which I was seeking to agree.

DAWSON J:  He was talking about the affidavit. I am looking

at the clause.

MR BLACK:  Yes, Your Honour, but that is not inconsistent, in

our respectful submission, because once he is at the

site and he then picks up his tools, that obligation

attaches.

DAWSON J: That is not "carrying out all work that I agree to

do", is it?

MR BLACK:	Through the agency of Troubleshooters.
DAWSON J:	He has agreed through the agency of Troubleshooters

to do the job, whatever it might be.

McHUGH J:  You see, it rather looks like what happens in

practice is inconsistent with the contract.

MR BLACK:  Yes, Your Honour. Certainly the affidavit was

not cross-examined upon and there was no answering

material and that was the state of the evidence.

McHUGH J:  When I first read the agreement I got the impression

that he accepted some particular piece of work to do

or a number of hours.

MR BLACK: No, that was never said. It was never suggested that

that was the case and the affidavit material does not

suggest that was the case.

BRENNAN J: 

Mr Black, is it right that this point that we have

been discussing with you over recent minutes was not
one that was present to the mind of the Full Court?

MR BLACK: 

I think that is correct to say that, Your Honour.

C2T30/l/HS	56	4/5/90
Accident(2)

BRENNAN J:  Well now, two questions arise, do they not; one

is whether it would be appropriate to have the

Full Court make the relevant finding, if finding of fact be necessary, if the parties cannot agree on it,

for all relevant purposes, and the second is, if we

are to decide it ourselves, where does the onus of

proof lie?

MR BLACK:	Well the onus would lie on us as we attack the assessment and I do not think I say that too quickly.
We were the appellant and the onus was on us to show
that we were outside the assessment. The argument
that I will advance in our submission can, at each level, stand without a finding on this point at all.
This is, as it were, a subsidiary argument.
BRENNAN J:	Do you mean even if this point were found against

you?

MR BLACK:  Even if it were found against us that the supposed

worker agrees that he will go to a particular site and

that when he is there he will not unreasonably refuse

to do the work that is offered to him, our arguments

will still stand, but if they failed, then there

would be a second line of defence, as it were, if the

true view, as we contend, was that there was no

obligation, at most, to do any more than turn up at

the site.

MASON CJ:  Perhaps in the adjournment which will be upon us

shortly you could discuss the matter with Mr Larkins

and see if it is possible to come up with an agreement

that covers these matters because it would be a pity if, at this stage, we had to send the matter back to

the supreme court for a finding on this issue.

MR BLACK:  Yes, it would, Your Honour. We will look at it

earnestly in the adjournment. Apart from the client's

paramount interests, looking at this section for

the fifth time would - - -

MASON CJ:  Yes, because obviously, in some shape or form,

these questions are going to be determined here.

(Continued on page 58)

C2T3O/2/HS	57	4/5/90
Accident(2)
MR BLACK:	Yes, Your Honour.	So that our primary argument

albeit an impressionist one at the outset is that

this section, section 8, was not intended to cover

this sort of a case however one analyses the precise

facts. It was not intended to cover the, for want of a

better word, labour agency sort of case. It is a

word that in some circles has pejorative overtones

but I will use it because it stresses the notion

of agency.

That is the starting point. Now, we also say

that the Full Court was correct as a matter language and, indeed, to an extent, authority, in saying that

what the section requires is the identification of a

contract under which you work for the person who is

the deemed principal/employer under section 8. There

is the passage that the Court itself cites from the judgment of Mr Justice Latham in HUMBERSTONE in the

High Court. There is a similiar expression of

opinion by Justice Dixon in the same case at

page 401, at the bottom of the page and, in any

event, the notion, in our submission, flows

naturally from a number of circumstances in the

words themselves.

The first circumstance is that the notion 1n

section 8(1) of a contract:

under or by which the contractor agrees to

perform any work -

would, in ordinary language, in our submission,

submit that that has to be work for the principal.

If one was going to introduce a third party element

in it, one would express that to be said. The next

element which the Full Court made reference to is

that the contract has to have a particular character;

it has to be a contract for the purposes of a trade

and business carried on by the principal. It has

to have two characteristics; it has to be in the

course of the principal's business and - the word

is "and" - it has to be for the purposes of a trade

or business carried on by the principal. That,

again, in our submissio~ requires that it is for

the principal's business that the contract has to

be made and, therefore, we would say as the Full Court

did, that means that it has to be effectively worl<. for the

principal. One is looking at what the person is

agreeing to do by way of work for the principal.

(Continued on page 59)

C2T31/l/SH	58	4/5/90
Accident(2)

MR BLACK (continuing):  That was one of the

considerations that the Full Court used to come

to the conclusion it did. It did this in the

factual context, as it pointed out, that TSA's

business was not advanced in the sense of work being

done for it by the man doing what he was doing.

The man worked, as the Full Court point out, for the builder's business.

DAWSON J:  I do not really see that because TSA, having

agreed to supply someone to do this job, supplies

this man or some other man but, the work that is done

is done in performance of TSA's contract with the

builder.

MR BLACK:  Your Honour, TSA - and this is corrnnon ground -

never agrees that the man will hammer the nails.

DAWSON J:	No, TSA agrees to supply someone.
MR BLACK:	He agrees to supply to somebody and that, Your Honour,

in our submission, is the essential difference

because the man is doing work in the course of and for

the purposes of the trade or business of the

builder. It is only if it can - - -

DAWSON J:  But, he is fulfilling TSA's obligation to supply

someone.

MR BLACK:  He has fulfilled it, Your Honour, he is not

fulfilling it. In our respectful submission, he

has fulfilled it by turning up at the site.

DAWSON J:  Presumably, correct me if I am wrong, if this

man does not turn up, TSA has to supply someone else.

MR BLACK:	Yes.
DAWSON J:	So it has got to supply someone.
MR BLACK:	Yes.
DAWSON J:	Now, if he does turn up at work, he is fulfilling

TSA's obligation to the builder.

MR BLACK:  Your Honour, I would respectfully accept that but

only in so far as the obligation is to provide

somebody who - an appropriate person who attends

at the site.

(Continued on page 60)

C2T32/l/JH	59	4/5/90
Accident(2)

BRENNAN J:  But when you say it is common ground that TSA

does not hammer the nails, to say that you shall

supply somebody to hammer the nails means that

unless you supply somebody who hammers the nails

you have not discharged your obligation?

MR BLACK:	Yes, indeed, Your Honour.
BRENNAN J:	Then, if the work that is being done is nail

hammering, is that not discharging TSA's

obligation?

MR BLACK:  Yes, but it is the nature of the obligation that

it is discharging. It has the effect of getting

the nails hammered but the actual obligation is

to produce the hammerer with his hammer.

BRENNAN J:  Who will hammer.

MR BLACK:  Yes. A person capable with the skills and the

inclination to hammer but that is it.	The man
is on the site and - - -

BRENNAN J:	Not somebody who hammers?
MR BLACK:	A person who generally hammers and is in a

hammering state of mind but no more, that is the

way we would put it, Your Honour, and who does

not hit his thumb, usually?

So that we say that there are internal

indications in the language of section 8 to

support what the Full Court said. The other point

is that if one looks at section 8(l)(a), the

exception itself, they focus upon actual work in

the sense of, we would say, hammering type of work,

physical work; for example, the exception in 8(1)(b)

says this:

in the performance of which the contractor

does not either sublet the contract or employ

workers or although employing workers actually

performs some part of the work personally -

(Continued on page 61)

C2T33/l /ND	60	4/5/90
Accident(2)

MR BLACK (continuing): Again, in our submission, the focus is

on the actual performance and the use of this

word "actual" is in the Act, "actually performs" some

part of the work personally. Again, we would say

that the emphasis throughout the section is upon
the person who does work in the sense of the work

that it is all about and the work relevantly that will attract the levy - that is another point the

Full Court made - because it has to be work that gives rise to leviable remuneration. That posits
a personal one-to-one relationship between the

principal and the labourer, or the worker.

McHUGH J: Well, you get some assistance from the word

"sublet the contract", do you not, because it is not

easy to think of subletting a contract to

perform work which is to perform work for somebody

else?

MR BLACK:  Yes, and the same may be said, in our your submission,

Your Honours, in respect of section 8(3). It is a

slightly different idea but it is the same general

thrust, and added to that there is powerful~ in

our submission, general policy reason, given the

origins of this section. The origins of it were to

create liabilities - and, indeed, that is still

part of its function. Now, although under the

new scheme of compensation in Victoria, or the one

that was then extant, the person - it is different from
the old scheme. There is no individual liability as

such except for the first few days. Nevertheless,

there is exposure to different rates of levy.

(Continued on page 62)

C2T34/l/LW	61	l~/5/90
Accident(2)

MR BLACK (continuing):  Now, in our submission, in a scheme

of compensation that involves the payment of money

by an employer or a deemed employer, there is at

least some basis for expecting that, in the absence

of words pointing the other way, the person who is
the deemed employer will have some control over

the risk and over the type of operation for which

he is liable for the levy. Now that works perfectly

well if the old-fashioned or traditional

HUMBERSTONE notions of section 8 apply. It does

not work well if section 8 is sought to be applied

to what I term the labour agency. The same sort

of point can be made when I come to section 9.

Now there is an alternative argument in relation

to section 8. It was one that formed the basis
of our appeal to the Full Court, which the Full Court

did not find it necessary to deal with, and it can

be stated very shortly and it is this: although

Ditchfield and Alexander were said, by the learned

primary judge to be working for TSA, it is perfectly

plain that they worked for TSA's clients, so that it

is, in our submission, incorrect to equate, as the

learned primary judge did, the work of Ditchfield

and Alexander, with the work of the "single customer"

type of people who traditionally have come within

section 8, and it is a short point. It is a

fundamental point as to how section 8 operates in

relation to the work of a labour agency. It is,

in our submission, an incorrect simplification and

it is completely erroneous. It leads to the wrong

result, in our submission, ::.f you regard these

people as working for TSA, because what they are

doing is they are using TSA for their own purposes

and of course for TSA's purposes; they are using

TSA to get work and they are doing so just as much

as individuals as they would be if they had an

advertisement in the local newspaper or in the

yellow pages or, if they were simply in the battered

notebooks that a lot of people have by their

telephones, the name of a good plumber or a good (Continued on page 63)

handyman.

C2T35/l/CM	62
Accident(2)

DAWSON J:	Except that they are paid by TSA?
MR BLACK:	Your Honour, exactly, but, in our submission, that

makes - that is a point of distinction but, in

our submission, it makes no difference to whether

or not one characterizes them as carrying on an
independent trade or business of their own. True
it is they are paid by TSA but they are only paid

by TSA if they avail themselves of the offers that

TSA will get them from various people who

constitute TSA's and therefore the tradesman's

public.

The point really is as short as that. One

can multiply examples by talking about actors who,
throughout the whole of their distinguished

careers only have one theatrical agent, they are

not therefore said not to be pursuing the independent

career or profession of an actor. One can talk

about barristers' clerks, which is not a perfect
analogy, but any sort of agent that acts regularly
for the one person, in our submission, does not
thereby cause a characterization of the client

or customer of the agent as - deprive it of its

ordinary characterization as a person carrying

on an independent business. Indeed, that

relationship may create the independent business

itself.

BRENNAN J:  In what sense do you use the term "agent" in

this connection?

MR BLACK:  In this connection, Your Honour, I use it in the

sense of somebody who will find work for you, make

work available for you and - - -

BRENNAN J:  Not find employment for you?

(Continued on page 64)

C2T36/1/ND	63	4/5/90
Accident(2)

MR BLACK: Well, even if it were finding - Your Honour, I

will use it in the narrower sense first - but even

if it were finding actual employment in the sense

of you having to do the job if the agent says you

do.

BRENNAN J:  No, I was not thinking in those terms. I was

thinking in terms of finding employment, creating

a relationship between another employer and the

worker.

MR BLACK:	No, I was not using it in that sense.
BRENNAN J:	No, well now, I do not understand what it is an

agent to do.

MR BLACK: Marketing services essentially, Your Honour. If

one takes Mr Ditchfield: he worked, I think it

was Mr Ditchfield who, throughout the relevant
month which was April, did all his work - as the
primary judge would have said "for", we would
have said "through" - TSA and there is a plural

in the affidavit so it does appear, as one would

expect, that he went to various jobs that he

obtained by answering TSA's phone calls. Now,

in our submission, the fact that the only persons

in that month on whose sites he did work were persons mentioned by TSA in their phone calls does not deprive him of - it does not mean that he

is not characterized as a person carrying on an

independent business because it is just quite

different from Mr Humberstone turning up at the

Northern Timber Mills for 30 years or whatever it

was until he has his heart attack. Here you are

going from site to site as the work is available

and as it	suits you; here one day, somewhere
else the other.

Now, in our submission, all TSA does in that

context is to provide a marketing service - yellow

pages, if you like - plus the extra, no doubt, very

useful ingredient that you do not have to do a
credit check on your customer.	TSA will guarantee
you payment.	You will rot get quite as much as you,

perhaps, might if you took the risk yourself and
did not use TSA services but you do not have to

send out accounts rendered. TSA guarantees you

payment and thus takes the risk. Will this be a

convenient time, Your Honour?

:MASON CJ: Very well. We will adjourn and we will resume at

2 o'clock.

MR BLACK:  May it please the Court.

AT 12.46 PM LUNCHEON ADJOURNMENT

C2T37/l/PLC 64 4/5/90

Accident(2)

UPON RESUMING AT 2. 06 PM:

MASON CJ: Yes, Mr Black.

MR BLACK: If the Court pleases, might I deal first with the

desire of the Court that we try to agree	the
facts.	We have earnestly tried to agree but I
regret to say that we do have differences.	When

I say I regret to say, our primary point is, of

course, that it does not matter. If our primary

arguments are accepted, it will not affect the

result as, indeed, it did not in the Full Court.

The situation arose in this way, which I am

bound to tell the Court:  I am reminded by

Mr O' Bryan, who was before Mr Ju s t ice Gray , that 1 n

fact I then argued that there was no contract

between TSA and the tradesmen. That was an

argument that did not succeed and which I now

do not desire to expose in this Court .but that

is the way it seemed to us at the time. That

argument having been rejected by Mr Justice Gray,

the primary judge, His Honour then made a finding

that there was a contract and that appears in

His Honour's judgment at page 199 and whatever

merit the point appeared to have at the time, it

is not pursued but His Honour says quite specifically

that that is what we argued; this is at line 10:

It was said that s.8 has no application

because TSA did not enter into a contract
with the contractors by which the contractors

agree to perform work.

That was the argument. It may not be really very

different from the present one but, in any event,

His Honour then held that the contractors did agree to perform work and he made a finding about that

by reference to clauses 7 and 2.

Then, in the Full Court we attacked that finding

and that appears - I think it was the second ground
of appeal - at page 210 but the matter was then lost
in the course of the argument before the Full Court

and they did not find it necessary to deal with that

precise point	s indeed, in our primary arguments
it is not necessary to deal with it here.	Now, all

we can say to the Court is that if the Court considers

our primary arguments and the Full Court's view is

wrong and it is then necessary to determine the

precise nature of the contract between the contractors

and TSA, then the factual material upon which that

finding emerges is very small. I say this with

diffidence but I say it would not trouble this

Court for long and, if the Court found that an

C2T38/l/SH	65	4/5/90
Accident(2)

improper suggestion, then if the worst did come to
the worst, the Court could remit it, but we would invite

the Court not to do so and would desire to take the

Court very briefly - and it will be very briefly -

to the evidence bearing upon that matter. But there

is one further bit of evidence that does bear upon

it and there are some findings in the Full Court on

it and if I might do that now before resuming the

section 8 argument.

The extra piece of evidence is at page 174 of

the appeal book and that is the evidence of - it is
an exhibit to one of Mr Groves's affidavits and it

is a document which he deposes to being something

that the contractors get at the time they sign the

standing form. He swears about it at page 162 of the

appeal book and the document itself is at page 174.

In our submission, it supports our primary contention that all a man has to do is to get to the job on time.

It reads as follows:

If you want work - ring us! Don't wait for

us to ring you.

It says what the best time is; "if you're available, • II

ring us

3. If you accept a job, do your best to get

there on time!

It is certainly not the sergeant major speaking nor
the command of somebody who thinks they have a binding

obligation on the other party to actually do the work.

4. If y~ don't want v.0rk, DON'T accept the job

we offer -

which, I suppose, could be a little against us and

then:

5.

time for us to get someone else to the job

If you are genuinely sick ..... ring us 1n

ON TIME -

so, again, we would submit that rather supports the

view that there is an obligation to get there and

with obvious excuses if you cannot.

(Continued on page 67)

C2T38/2/SH	66	4/5/90
Accident(2)

MR BLACK (continuing):  The next, number 6:

If you've got a job and you are not

returning to that job, for whatever
reason, ring us that day before 5.00 pm -

It rather suggests that the independent contractor can go there and stay for as long as he wants,

as the affidavit would suggest, but then, number 7: Always ask the job foreman if he wants you

to return the next day.

It's not always possible to contact clients

after working hours to get answers.

Number 8:

If you have a problem ..... ring and tell us

..... if we can't solve the problem for you,

we can at least offer some advice.

Number 9:

keep a diary.

Then, beneath that, line 25:

Whilst we are given information from the

client at the time he makes the booking,

this information is frequently changed,

(i.e. a change of sites, site allowances,

etc).

Again, in our submission, it supports rather the view that the obligation is to turn up and that no

actual ofn.igation to do work arises until the man

accepts the job. Then, at line 33:

If you are moved to a different site by the

client WE NEED TO KNOW the same day. Ring

us and tell us.

That is quite consistent with the handyman, the complete advertising, independent contractor saying,

"Yes, I'll do this job" and the customer saying,
"Yes, well the job involves some other work at the

other site", and that is the additional piece of

evidence.

Now, the primary piece of evidence, in our submission, apart from the contract itself is the

passage to which I have referred the Court on page 33

in the affidavit of Mr Groves and the findings of the sense, oblique to the point that has now emerged, is

C2T39/l/JH	67	4/5/90
Accident ( 2)

at page 216, the top of the page where Their Honours

say, line 5:

The TSA employee then contacts an

appropriate contractor and advises the

contractor the particulars of the

builder's requirements. If the proposal

is acceptable to the contractor, he attends

at the building site and performs the

necessary work at the direction of the

builder.

The other passage is at page 231, in context of the section 9 argument, where Their Honours make

two observations, the first at line 5, where they say:

The "work" referred to in the pro-forma
TSA/Tradesman Contract is solely the work

to be performed for the builder, that is, the

work which the worker agrees to do when he

accepts an assignment or placement -

which is equivocal.	And then, at the bottom of the
page at about line 18:

Under the TSA/Tradesman Contract the latter

assumes obligatioms - obligations to insure,

to perform work in a workmanlike manner, to

make good his or her work, to provide his/her

plant gear etc but assumes no obligation to do

any work at all at any time for TSA or for

the purposes of its trade or business.

It may be that that passage was coloured by other

argument but, Your Honours, it is with regret, I say,

that that is as far as we can take it. The point

is short and on our primary submission unnecessary

for decision. That is the substance of the evidence

about it.

MASON CJ:  Yes.

MR BLACK:  Might I then return to the section 8 argument and

develop it a little further before turning to

section 9? The essential point that I will not labour

is that the interposition of an agency that is, in

effect, a marketing service does not create the

single customer situation that traditionally - and,

I think, in every case that has been decided - it

has dealt with the single customer type of situation;

the classical situation of Mr Humberstone. The cases,

as far as we know, have never dealt with this "labour
agency" interposition of somebody who finds work.

Now, the learned primary judge, in our respectful

submission, simply ignored that. He dealt with it at

page 201 of the appeal book, where he said, in

substance, at line 20:  V

C2T39/2/JH	68	4/5/90
Accident ( 2)

The evidence shows that, during the month

of April 1987, Ditchfield worked solely

for TSA -

and that is true, if working for TSA means working

through TSA but Mr Ditchfield's affidavit carries

the clear inference that he worked for clients of

TSA and I will take the Court to that in a moment.

(Continued on page 70)

C2T39/3/JH	69	4/5/90
Accident(2)

MR BLACK (continuing):  Similarly at page 203 at line 20,

where His Honour deals with Mr Ditchfield:

only one possible conclusion, namely

that Ditchfield's work for TSA is not

within the exception. This follows from

the inferential evidence that Ditchfield

worked full time for TSA and the absence

of any evidence that he did any sort of

work for anyone else or held himself out

as available to work for anyone else.

Now, the error in that, in our respectful submission,

is that Ditchfield and Alexander held themselves out,

by virtue of their relationship with TSA to do any work
that they might choose to accept for any one of the

variety of builder customers of TSA who might want

their services. That is really the point and it is

a fundamental distinction and we would say, with

respect, that the method of payment for which one

can see commercial advantages for all parties does

not transpose that into a single customer HUMBERST0NE

type of situation.

Might I just take the Court very briefly to what

the evidence of Ditchfield and Alexander was because, in our submission, it does support clearly the notion that they were carrying on an independent business

through, or with the assistance of, TSA as it were

a marketing agent. Ditchfield is at page 92 and he

says, in substance, he was a qualified scaffolder,

he had the appropriate ticket and he carried on

business as a contract scaffolder. When there was

none of that work available he was a contract

builders' labourer.	He then says - and this was not
cross-examined upon:

I carry on business under my own name as an independent contractor.

He exhibits his tax return and he then says that he

provides various scaffolder's equipment and, importantly,

in paragraph 4 at about line 18 he says:

I worked as a contractor for clients

referred by Troubleshooters.

(Continued on page 71)

C2T40/l/HS	70	4/5/90
Accident(2)

MR BLACK (continuing):  So that it is not just a single client

if that actually mattered, but there would be the

variety of people for whom Troubleshooters would

provide work.	And then over the page at 93 he
expresses a subjective view about himself.	He
is:

self-employed -

He has -

freedom ..... The agency just supplies the work which I want to do. It is up to me whether I

take it or not. The agency does not direct

me ..... It is entirely up to me and the site

supervisor on the site where I am working at

the time.

He said it is -

convenient -

and that is really what he says. That is the way he likes to work. Now,Mr Alexander says much the

same sort of thing at page 100. I should add that

in his tax return he makes claims which are

understandable enough, at 98, the sort of claims

that a contractor would make. He claims

his Mazda Ute (1 tonne), depreciation for that; tip

fees; his scaffolding ticket and telephone and

perhaps an optomistic claim for home electricity

costs and prescribed payments under that legislation.

ThenAlexander, at 100,seems to be different because

one does not associate builders' labouring with

business, but I will come to that in a moment by

reference to authority. He says in 2 that he:

was a self-employed labourer.

He obtained all his -	labouring work through Troubleshooters Available.
I did not have a registered business name nor
did I advertise or keep separate books of account.

In paragraph 7 he :

owned a few tools -

which he describes. Over the page at 101 in 9 he

makes the same subjective assessment of his

circumstances. It gave him -

flexibility to pursue the other business I

was interested in.

C2T41/l/CM	71
Accident(2)

And 11 at the bottom of the page he says he:

did typical builders' labourers work such
as digging holes, sweeping floors, jack hammering,

drilling holes, demolition and general non-trade

tasks.

(Continued on page 73 )

C2T41/2/CM	72	MR._BLACK, QC 4/5/90
Accident(2)

MR BLACK (continuing): It was covered by personal disability

insurance which the company, the evidence shows,

requires, or certainly wants, and then in his

tax return, at 103, 104 and 105, one finds the

normal sort of deductions that would be claimed -

he describes himself as a contractor - the normal

sort of deductions that one would find for a very

small business person.

So that was the situation with those people.

Ditchfield was a tradesman; it was a recognized

trade; had his own tools and equipment; he

regarded himself as an independent contractor

and he said - and it was not objected to - that

he carried on business in his own name as such,

and he got jobs, plural, from TSA.

Now we say it is no different with Alexander.

One might, in fact, shrink from the notion that

a contract labourer carries on a trade or business

but there is authority, indeed, in this Court

that such a person does, and the authority to

which I refer is the decision of the Court in

HIGGINS V JACKSON, (1976) 135 CLR 174. That case

came here on appeal from the Court of Appeal in New South Wales on a section that is similar to section 8 of the Victorian Act.

The essential point in HIGGINS'S case was that

Mr Higgins was a handyman who did not advertise

and he was found by the judge in the Workers'

Compensation Court as not being within the ambit of

the independent contractor extension, and

Chief Justice Barwick, at page 176, isolates the essential point, at point 4 of the page. His Honour

said:

The argument went so far as to submit that,

to come within the exception, the contractor

must advertise his business in some public

fashion.

His Honour then examined HUMBERSTONE and ZUIJS's

case and then continues:

in my opinion, nothing said by Sir Owen Dixon

supports the submission. It is sufficient,

in my opinion, that the contractor does in

fact carry on an independent business under

his own or a firm name. No doubt a person who

does so may become known as doing so.

And then His Honour said it required regularity and a few lines further down he says:

C2T42/l/LW	73	4/5/90
Accident(2)

But, in my opinion, there is no separate

element required by the sub-section of holding

out.

Four other members of the Court agreed;

Justice Jacobs dissented.

Two points emerge from HIGGINS V JACKSON: the

first point is the point immediately relevant, that is,

Mr Higgins, the war pensioner, was working as a

handyman. If one looks up the case in the New South

Wales Court of Appeal - and I do not invite the

Court to actually look at it now but it is in

(1974) 1 NSWLR 9 - it emerges at page 11, point 7

of the page, that Mr Higgins was characterized by

the Workers' Compensation Court judge as:

carrying on a trade or business as a handyman,

carpenter, and general factotum, in which

he was using his residual working capacity,

and such skill as he possessed, to eke out a

livelihood.

So he was a jack of all trades and that was also

mentioned. Nevertheless, it was held that such a

person can be, as this man was held to be, a true

independent contractor and, in our submission,

in any event in modern days, there is indeed a

recognized skill and, indeed, industrial

classifications of builders' labourers and it is

to tLivialize that work to say that it is just

digging holes. It, in a sense, is digging holes

but there is a lot more to it than that. So on

that rather technical point, we say there is no

answer to the claim that Mr Alexander had a

separate trade or business.

BRENNAN J: Mr Black, before you go to section 9, could I just

ask you how does your argument on section 8

operate in the case of a putative principal

who carries on a service industry? Take, for example,

Hoover washing machine repairs and the contractor

goes out hour by hour to Mrs Jones and then to

Mrs Smith fixing her washing machine.	Does that
fit into section 8?

(Continued on page 75)

C2T42/2/LW	74	4/5/90
Accident(2)

MR BLACK:  The difference there is - there are a number of

differences, in our submission, and the first is

he may well be an employee; secondly, he is, in
truth - I do not have enough facts but on what,

Your Honour, I broadly understand by the Hoover

washing machine - - -

BRENNAN J: Perhaps I could explain a little more what I

have in mind? You say here, in this case TSA is

a labour agency?

MR BLACK:  Yes.

BRENNAN J: And, therefore, the work that is done is of no

immediate concern to TSA. Once you get into the

service industry areas then the principal's work

is of concern - the work that is done by the

tradesman on the job for people outside is of

immediate concern to the principal.

MR BLACK:  Your Honour, there is, at first, an immediate

impressionist difference in that and it goes further

than impression.	You look up the yellow pages,
you see Hoover repairs, Hoover, _and you ring the number.	A person

comes and he will come to Mrs ~lacK or Mrs Costello

or Mr Black or Mr Costello as the case may be

simply because you have isolated him because you

want your Hoover fixed. He is much closer to the

single customer. He is more like Mr Humberstone

who no doubt drove the timber jinker to whatever

mill Northern Timber Mills wanted him to; much

closer to that than the labour agency person.

He is much closer to the single customer type.

Beyond that, Your Honour, we would have to

say it would depend upon the precise contractual
arrangements that had been entered into with Hoover.

He might be caught - rather, he might get the

benefit of and Hoover might be caught by section 9,
particularly because there is a tripartite - there

may well be a tripartite arrangement there, with

three parties, and it is the three parties, as

I will come to in a moment that provide symmetry and the sense behind the Full Court's - if I may

say so with respect - decision.

Once you get the tripartite element section 9

works without any strains and, Your Honour, it

may be the answer lies - as a matter of social

policy the answer lies there in the appropriate

circumstances. Other than that, we would say,

Your Honour, that the impression is quite different

and our argument is not a turning back the clock

to, as it were, disentitle - or we say it is not -

Mr Humberstone's successors or their modern

equivalents.

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Accident(2)

It is correct, in our submission, because

of the closer analogy between the labour agency
and the theatrical agent or any other sort of
agent who, really, is out in the market getting

you work, for his own purposes. I hesitate to

mention, again, the barrister's clerk although

the analogies are less than complete.

So, for those reasons, we say, first, the

Full Court was correct in its analysis that the

work has to be done for the principal in a real
sense - and it was not so here, whichever view

one takes of the contract - and, secondly, the

argument in the Full Court did not find it

necessary to deal with is it sustains the objection
in any event because of the particular nature of
the relationship, however characterized within

the ambit of the dispute between the parties.

Might I now turn to section 9 and ask,

rhetorically, first, what is the section trying

to do? It is not, in our submission, primarily

a social benefit section and we say that for a

number of reasons: firstly, its origin is in the

revenue; it is, I think, a direct - or, certainly,

a substantial transplant from the 1983 PAY-ROLL

TAX (AMENDMENT) ACT. Its legislative history is

dealt with by the Full Court in the MAYNE NICKLESS

V MACKINTOSH case, dealt with by Mr Justice Murphy

delivering the judgment in that court and that

appears at pages 888 of the report where

His Honour refers to the speech of the treasurer

in the lower house and also it appears at page 883,

primarily, where His Honour refers to the - at

the bottom of page 882:

(Continued on page 77)

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Accident(2)

MR BLACK (continuing):

Section 9 was introduced into the

ACCIDENT COMPENSATION ACT 1985, being

taken from the PAY-ROLL TAX (AMENDMENT)

ACT ..... Its purpose in that PAY-ROLL TAX

ACT was to counter the avoidance by

employers of the payment of pay-roll tax

by the engagement of new staff as

contractors rather than as employees.

(See the explanatory memorandum.)

Now, just stopping there, there is nothing funny about

a labour agency. On the face of it it is simply a

method, historically well known, of people being able to,

one, obtain people they want to work for them and,

from the contractor's point of view, getting work.

Then His Honour continues at page 883 at the top

of the page:

It was intended to operate "to remedy"

this situation and was designed "to ensure

that all the required transactions are caught

and also to combat tax avoidance".

His Honour goes on in a similar vein, particularly at line 35 where he quotes from Hansard:

The Government is determined to stamp out avoidance and evasion, and this is one of the provisions necessary to achieve

that object.

Now, it is true, of course, that in addition to

imposing a levy on certain types of relationship

persons will be deemed to be workers and will get the

benefit of that categorization, but it is a curious

form of deeming because it will depend, as I will

seek to demonstrate in a moment, in

some no doubt rare circumstances on the intention

of the putative employer as to whether he was

intending to evade the levy or not.	So that the
social purpose of making a worker a worker for the

purposes of beneficial legislation may, in some rare

circumstances, depend upon whether his employer was

trying to evade the levy or not, which is somewhat

foreign to the normal concepts of social welfare

legislation, although it is conceded it does have that

that element.

If I might give the Court a brief reference to the

sections that do that, they are subsections of

section 9; section 9(1) (f), the end of - the last words

of that section which is an exclusion from the levy,

then have an exemption form the exclusion based upon

whether there was an intention to evade. A similar

scheme operates in relation to section 9(4), the

person may or may not be a deemed worker depending

C2T44/1 /HS	77	4/5/90
Accident(2)

upon matters of evasion and also section 9(5)(b)

has an element of the same nature in it. So that

we say that section 9, although it does have a social

purpose, is coloured, indeed permeated, by its revenue

aspects and its anti-avoidance aspects and, in that
context, when one finds what - leaving aside

philosophical differences about the type of the work,

what one finds is a legitimate business.

One starts off with wondering whether it would

be caught and, in our submission, it is not and to

make that point good might I go immediately to the

Full Court's analysis to show its symmetry and,

for that purpose might I invite the Court to look

at what we have termed analysis A which is, in fact,

the same as our learned friend's flow chart 2.

Analysis A is the one that the Full Court undertook

essentially and it works. The point we make is that,

as a general matter, since the contract for the supply

of services to a person must also involve a contract
for the receipt of services by the other person,
every contract can be analysed from the point of view

of the supplier or of the receiver.

Now, there is a catch to it. It does not affect

the argument because the catch is not always there, but the catch is that under section 9 the person has to be receiving or supplying in the course of business

and so that you can get a disconformity. In some

cases a person will indeed be supplying under a

contract in the course of business but the receiver

will not be receiving in the course of business,

but that is not necessarily the case and indeed in

this instance - we would say in all the instances,

including Ditchfield and Alexander, they were supplying

or receiving in the course of business.

Now, if one accepts that, the TSA builder

contract, whatever its true terms, is readily

analysed under section 9 and it works.

(Continued on page 79)

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MR BLACK (continuing): 9(l)(a),TSA in the course of a

business,supplies to a builder services, as

the Full Court has found. Put at its minimum

wants. 9(l)(b) the builder, in the course of his business, has supplied to him services by	it is sending a man to the site that the builder the site. There is therefore a conflict and the Act itself contemplates that there will be
and indeed it resolves it, because if one goes
then to section 9(3)(a) the potential for conflict
is recognized and is solved. What that provides,
in substance, is where you have got a 9(l)(a) and
a 9(l)(b) contract, the person to whom the services are supplied is the deemed employer and the
conflict is resolved, rather neatly, in favour of
the end user who would ordinarily be the person who controls the risk.

The mechanism then, it has to do some fiddling

around to negate the effect of some of the earlier
sections and we have referred the Court to them,

but the end result is that the end user is the

employer in such a case and that means, in this case,

the builder and not TSA was the person liable for
the levy and it is easy to see, if one looks at

9(2)(c) how the levy could be calculated, because
it is paid on amounts paid or payable by an employer
in relation to the performance of work relating to

a relevant contract and so that relates to the

actual work done, in this instance by the third party.

I omitted to demonstrate to the Court or to seek to

submit to the Court that there was a worker. Indeed

there is. The worker, in this analysis, is the

tradesman and that emerges from section 9(2)(b)(i),

because he is a person who performs work"for or in

relation to which services are supplied to another

person',' words that the Full Court found to be

important and which we respectfully submit are,

under a relevant contract.

So with the tripartite arrangement there is

syrrrrnetry and it works and the Full Court so found

and indeed in our outline we say it was virtually

conceded before the Full Court; it is, of course,

conceded in this Court by the appellant that that
can work, subject to the exceptions which may or may

makes sense and the liabilities are with the end user.	not operate. But subject to that it works and it
Now the problem with going further really involves the problems of a revenue body saying, "Well, we do not like that target. Let us find another one",
and when you start looking for another target, in
addition to the one that the legislative bulls-eye
strikes at the very heart, one gets into troubles

C2T45/l/CM	79
Accident(2)

and might I illustrate how this happens by

reference to our analysis B.

MASON CJ: This is D?

MR BLACK:  No B, Your Honour, the next one. Now analysis B

has no counterpart in my learned friend's argument.

It has to, in order to make his argument good,

be overlooked, but it cannot be overlooked. Might

I go through analysis Band then the Court will see

that a bizarre result occurs. There is a wand that

can indeed change black to white, according to

which stand point one starts from and our short

point is, of course, that that must be an absurdity.

Analysis B proceeds on the assumption that the TSA tradesman contract is one under which services, whatever they be, are supplied to the tradesman under the tradesman TSA contract and let us suppose

that the services are, on our primary argument,
to find a site for him to go to. That will work

both ways. If we go to 9(l)(a) TSA in the course

of business supplies to the tradesman services for

the performance at work. It is straining it to

say it~ but let us except that supposition.

(Continued on page 81)

·"'!,;· .. ~ ••

C2T45/2/CM	80	4/5/90
Accident(2)

MR BLACK (continuing):  So, they have supplied the tradesman

the service of finding him a site to go to.

Section 9(l)(b), the tradesman - in this case,

somebody like Mr Paterson in the course of his

business - has supplied to him services for the

performance of work; that is to say, the finding of the site. It is a relevant contract pursuant to 9 (l)(a) and (b) so the person to whom the

services are supplied is deemed to be the employer

because there is a conflict.

Now, the bizarre result then is and, in our

submission, it is irresistible if one looks at it
in this two-party way, the result is that the

recipient, the tradesman, is the employer. The

person who performs work in relation to which

services are supplied, that is to say TSA, is

deemed to be the worker. That is the mirror image

of the way the appellant would wish to analyse it.

Now, why it works in such a bizarre way, in our

submission, is that it has two suppositions involved

in it: the first is that only two parties are involved

and the second is that the provider of services and

the performer of work are the same people. Now,
that is its characteristic and that is why - the

Full Court did not quite put it this way. They

concentrated more on the precise language of the

Act - but that is why the Full Court's requirement

which we would respectfully say should be consistent

across all the sections and was not in MACINTOSH's

case; that is why the Full Court's requirement is

correct. Once you get a tripartite system, this

absurdity as far as we can submit or see does not happen.

Now, if one then goes to our analysis C which

is the counterpart of the respondent's analysis

number one, one gets exactly the opposite result but this time one views the same contract from a

different standpoint. It is the same TSA tradesman

contract but on this occasion one views it from the

viewpoint of the supply by the tradesman to TSA of

services so that TSA is the recipient.

Now, 9(1)(a), the tradesman in the course of

a business supplies services to TSA; he goes to the

site. Section 9(l)(b), TSA, in the snurse of a

business, has supplied to it the services of persons

for the performance of work; that is to say the tradesman

goes to the site or, on the way my learned friends

would argue it, goes to the site and then does some

work. Again, you get a 9(l)(a) and 9(l)(b) contract.

It is a relevant contract under both; therefore, the

receiver of services becomes the employer and it is

the exact reverse of the preceding analysis. To avoid that result, one has to,in our submission,

remove the notion of only two parties. Once one

C2T46/l/SH	81	4/5/90
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introduces the third party, the worker as distinct

from the provider of services, it works and that is

an analysis which, in our submission, demonstrates

by a different but not radically different route,

the correctness of the Full Court's conclusion in

this case.

I concede immediately that statutes can produce

odd results but it could not be presumed, having

regard to the language used which works if you look

at a tripartite arrangement, it could hardly be that

in a real life situation such as one can encounter
here and did in the case of Paterson, the result
not only in respect of a levy but in respect of the

social purpose of whether a person is a worker or

not, could be different from whichever way one has

a starting point.

BRENNAN J:  But if one construes "services for or in relation

to the performance of work" as meaning the provision

of services which immediately results in the performance

of work, the problem disappears.

(Continued on page 83)

C2T46/2/SH	82	4/5/90
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MR BLACK: 

With respect, not, Your Honour, because however

one characterizes the service, widely or broadly,
there will still be a supplier and receiver of that
exact same service.

BRENNAN J: 

Quit~ but the service in your example (b) is

different from the service in example (c). The

service in example (b) is getting a job for somebody

and in example (c) he is getting somebody to do

the job.

MR BLACK:  Yes. Your Honour, it need not be. In example (b),

it can be finding the site and getting the site.

BRENNAN J:  It may be but it is getting a job for somebody

to do as distinct from getting somebody to do a job.

MR BLACK:  But, Your Honour, what we would submit is that

if the service is getting the job from the one point

of view - and we are only dealing with two parties and this

is the problem - if the service is getting the job -

if I am the tradesman, the service I get is getting

the job and it said that the other party gives - equally
the other party - I give a service to the other party
of going to the job. If one, perhaps, narrows it
in terms of a part of the service, part of my service

is being found the site, part of TSA's service is

finding me the site. It is doing and being done to

and, in our submission, ultimately there will be

a correspondence, at least at the core and we had

thought totally, but at least at the core, which

produces this bizarre result. Now, all that goes if

one introduces what one would naturally expect to

find looking at the structure of the language, one

finds the tripartite arrangement. And it would also,

I think, Your Honour Just±£e 1'rennan, work

with the Hoover man in certain circumstances

particularly if the householder were, himself or

herself, carrying on business. It might not work

exactly but one could see many examples through

industry where this would work and where, if it did

not work, there could indeed be evasion.

That, we say, underscores the correctness of

the Full Court's approach. There are some other -

McHUGH J:  Your argument depends, though, on both parties

being engaged in a business.

MR BLACK:  Yes, it does, Your Honour. If one does not, that

absurdity does not arise but our point is that because

the example is not a fanciful one - and it is not

if our section 8 argument maintains its - if the

Full Court is upheld in that then all of them - I am

sorry, I withdraw that. Suppose there were 50

C2T47/l/JH	83	4/5/90
Accident(2)

Mr Patersons - and there might well be; we know there

is one and it is not fanciful to suppose there

could be many - it does not work in every case,

Your Honour, I accep~ but the fact that it works

in a case that is in the real world and not at the

edges of the real world demonstrates that

something must be wrong.

McHUGH J:	What about the plural persons in paragraph
MR BLACK:	Your Honour, that is another problem and it is

a problem that faces my learned friends rather

than us. It is not in the forefront of our

argument because if one accepts that it is

deliberate - and it does seem to be - if one

accepts that, then it does cause other problems but

it does, if that is right, highlight the sort of

case that we say the section is really aimed at.

For example, the builder Troubleshooters'contract

would involve the service of persons. The TSA

tradesman contract only ever involves the service of

one person and it may be that the legislature in some -

not to us - easy section was getting at that sort of
thing. If it was not in the forefront of its mind, it

was in the recesses of it.

(Continued on page 85)

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MR BLACK (continuing):  Mr Justice Murphy in MACKINTOSH's

case thought that there was no contrary intention

shown for the purposes of the INTERPRETATION OF

LEGISLATION ACT and therefore read it as a

singular but, with very great respect to

His Honour, the introduction of that expression

is so striking that we would submit, at a lower

order in the argument, that that is an indication that the analysis argued for by the revenue - - -

McHUGH J: Particularly in a provision which talks about

"during a financial year" and "in the course of

a business, as supplied".

MR BLACK:  Yes, and there is another one, one of the exceptions

talks about contracts up to $500,000. It seems

to be getting at - and the plural is an indication

of it - the sort of work that somebody would do

by using the services of other persons on a fairly

large scale. But there are answers to the

argument. If you read it that way then it has

a curiously confined operation in other respects.

So we put the argument in as a general supporter without placing full emphasis on it.

But there are other indications in the language

of the Act that, in our submission, support the

notion that the work has to be different from the

service - rather, the provider of the work has

to be a different person than the provider of the

service. One of those indications is to be found

in section 9(l)(e)(iii)(B) - this is one of the

exceptions. It is at the bottom of the page,

I think, of Your Honours' print. It again seems

to draw this distinction between a contract for

services on the one hand and the actual performance

of the work on the other. And then

section 9(2)(b)(i) itself, which is the critical
section that discovers a worker, that seems to

draw a very clear distinction between a person

who performs work, on the one hand, and services

being supplied to another person on the other. That was a section that particularly was

relied on by the Full Court. In our submission,

it quite naturally fits into the tripartite

arrangement. It does not naturally or easily fit
if one has only a two party arrangement because
the other person then - it is a strained meaning

of that expression.

Section 9(6)(d) is the definition section

but it, curiously, and curiously indeed having

regard to the ambiguities apparent in this section

on my learned friend's construction, although it

includes as part of services the "reference to

C2T48/l/ND	85	4/5/90
Accident(2)

results" it scrupulously does not include the

actual work for some reason. And we say the reason

is that the work and the services have to be

performed by different people and one therefore

has the tripartite system.

There is also an indication in section 8

itself, a matter that Your Honour Justice Brennan

raised with my learned friend, Mr Larkins, before
lunch, that uses quite different language and my

learned friend replied to that by saying that

section 8 was an old and venerable section

because they do not sit nicely - one should not

draw any inferences because it is there. But we

would respectfully submit that the answer to that
is that section 8 was obviously amended when it

was brought into this Act because it now has a

levy attractor tacked on to the bottom of it; so

that the Parliament did not simply transplant

section 8, it adapted it for the purposes of this

new Act and adapted it for the purposes of the

collection of the levy.

(Continued on page 87)

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Accident(2)

MR BLACK (continuing):  Now having done that, differences

in language between 8 and 9, in our submission,

assume a significance.

The next point that we would make has really

already been hinted at and that is the proposition

we have articulated as No 12. A section 9(l)(a) analys,

of the Troubleshooters contractor contract

produces oddities and they are oddities that, in our

submission, really strain the language of the

section. If one again posits that a tradesman

in business supplies services to Troubleshooters,

then the tradesman becomes, on one view, an employer

by reason of section 9(2)(a)(i) which is an

oddity in itself and then by section 9(2)(b)(i)

it would seem that he would also become a worker

because he would be, on that view, performing

work:

for or in relation to which services are

supplied to another person -

that is to say, Troubleshooters -

under a relevant contract -

which is, again, an oddity. It is an oddity that

disappears once one introduces two things: a

tripartite arrangement and,secondly, a difference
between the performer of work and the supplier
of services.

There is yet another analysis of 9(l)(a) that produces an oddity and that again proceeds

on the assumption that there is a relevant contract

between TSA and the tradesman. TSA provides

services to the tradesman in finding a site.

That will produce under 9(2)(a)(i) Troubleshooters

as the employer but we would then ask where is the

worker. If one looks at 9(2)(b)(i), the

tradesman is only a worker on the strained

construction that he is performing work in relation
to which services are supplied to another person,

that is to say, Troubleshooters under a relevant

contract, yet he is both the worker and himself

the supplier of services, so that one may end up

with no worker, even though one has an employer.

Certainly, if one does have a worker he is a

strained statutory worker.

And in answer to the point that it does not matter that you have no worker in certain

situations where you have an employer, we would

answer that this way:  we would say in theory it

might not matter but - almost in the New York accent -

C2T49/l/LW	87	4/5/90
Accident(2)

what sort of an act is that? Why would one bother

if one is trying to erect a very careful

statutory scheme that we have demonstrated, and

it is common ground it will work in some

circumstances, in sensible circumstances, why

would one erect an ediface that only provides

one positive answer to a question that only

produces single-sided coins as it were? It is
possible but it is unlikely, and our primary

submission - and the view the Full Court took -
produces no problems. It produces a worker - for

every employer there is a worker and it produces

symmetry. So for those reasons we would say that

if my friend's argument does concede that there

might be a situation where there is an employer

and no worker, the likelihood is that the analysis

is wrong - not inevitable but it is likely.

The other problem, in our submission, with the

ACCIDENT COMPENSATION COMMISSION's section 9(1)(b)

analysis involves going back to see what really the tradesman does for TSA. Now the Full Court held that the tradesman did not provide services

to Troubleshooters.

(Continued on page 89)

C2T49/2/LW	88	4/5/90
Accident(2)

MR BLACK (continuing): In our submission, that is correct.

If it is said that the tradesman does provide services

to Troubleshooters, it is certainly a very strained

form of service. The more natural way of looking at

it, in our submission, is that Troubleshooters
provides a service to the builder and the builder
receives a service for and in relation to performance

of work and a third person, the Troubleshooter, the

worker, does the work and that fits neatly and

naturally and produces a result. When one goes

beyond that, in our submission, one gets a strained

result and we would say that what the tradesman

gives to Troubleshooters is really no more than

turning up in his truck at the site. Even if it

involves turning up in the truck and doing the

work if the foreman is there and asks him to do it,

the real service and the natural service is the

service provided to the builder. It is not

impossible to say that it is a service; we concede

that but it is not the sort of service; it does

not fit neatly within the concept.

The final problem is the one that Your Honour

Justice McHugh mentioned and that is the section 9(l)(b)

analysis of the Accident Compensation Commission must

have it that the services of persons plural in

section 9(l)(a1(b) is an accident and we would say

that it would be odd indeed if legislation that has

obviously been very carefully thought out by

somebody and presumably carefully proof read,

would have a quite inexplicable plural in the

midst of a lot of other singulars, particularly

singulars in the same section and the existence

of the plural does make sense if one looks at

the analysis that we say is the preferred one;

that is to say, a tripartite analysis where you

have a largish company supplying the services of

persons to individuals but we do concede that and
we do not put that in the forefront of our argument.

We put it, perhaps, by way of another indicator rather

than by way of primary submission.

There is, and I regret to say I cannot find

it, but I am reasonably confident there is another

"persons" in there somewhere. If the Court would

bear with me for one moment.

McHUGH J: There is a reference to two or more persons

somewhere or other.

·MR BLACK: Yes, there is, Your Honour. That lS ln

MASON CJ:	That is in (f).
MR BLACK:	That is in (f) but I regret to say - I may have
imagined it but I thought there was another one.

C2T50/l/SH	89	4/5/90
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MASON CJ: It is in (4)(b), I think, Mr Black, 9(4)(b).

MR BLACK:	Yes, thank you, Your Honour. Yes, it is. There
is a mirror - it picks up that same curious expression.
Now, if i.t docs anything, it points to the logic of the tripartite approach because that will accommodate those persons; it will accommodate the plural.

Your Honours, there is one final matter that I

should deal with. It is a matter of detail only but

it has been argued and that is the peculiar position

of one of the contractors who is a company and who

employed Mr Clancey. Now, it has been argued us.

Although it docs not, in our submission, raise

matters of higher principle, it bears upon my

client's - if my friend's argument is right it

increases the levy and I would desire to spend a

few minutes on it.

Might I invite the Court to go to what we have

described as respondent's analysis D to answer that

submission. Now, this focuses upon the situation

where Mr Clancey is, in fact - and the evidence is

clear about this - Mr Clancey was an employee of

what in loose terms might be described his own

company; I think he was the trustee of a family

trust. The company is the person who, in fact, is

on TSA's books and what happens is, under 9(l)(a),

TSA, in the course' of a business, supplies to the

builder services for and in relation to performance
of work; somebody goes to the site. Section 9(l)(b),

the builder, in the course of his business, has

supplied to him the man on the site. It ends up

as per our analysis A with logical result. The

receiver, the builder, is the deemed employer and

Mr Clancey is, in fact, a worker, the individual,

the flesh-and-blood Mr Clancey, because, under

are supplied to another person under a relevant	9(2)(b)(i), he performs work for which services
contract. So he is a deemed worker; no difficulty.
That is our analysis A. The Full Court's analysis
applied to the case where a company is interposed.
You find a worker; you find an employer and it is
not a problem.

(Continued on page 91)

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MR BLACK (continuing):  But then if you go to the analysis

undertaken by the respondent you do get into

difficulties. Suppose one then looks at the contract

between Troubleshooters and the building company,

Mr Clancey's employer, then one finds the difficulty.

Under section 9(1)(a) Troubleshooters, in the course

of business, supplies Clancey's company with services, section 9(l)(b) the building company, obviously in the

course of a business, because that is its business,

has supplied to it by TSA the services of persons,

the person to whom the services are supplied is the

deemed employer, and subsection (3)(b) operates not

to deem TSA the employer.

The person to whom the services are supplied

is the deemed - I think that should read "employer",
at the top of page 2, and, again, the person who performs
the work for which services are supplied to another
person, is the deemed worker, and he is the deemed

worker and there is no problem because we are again

looking at a tripartite arrangement. Then if we go

to flow chart 3 which is in the last part of

analysis D, you can get a situation where Troubleshooters

is, in fact, an employer, but it is, as it were, a

long way down the line. It arises in this way and

the curious twist at the end is, of course, that

Mr Clancey is a worker. He is under a contract for

services and the levy has been paid for him anyway

by his employer which is his own company. This

is where the commission's argument would lead one.

The way it works is as follows, so it is put.

Clancey's company supplies services to TSA.

Section 9(l)(a), BDC in the course of business

supplies to TSA services, that is it sends Clancey

to the site, section 9(l)(b) TSA in the course of

business has supplied to it services by BDC, that is

to say Clancey goes to the site, the person to whom
the services are supplied, TSA, is the deemed employer,

the supplier is not deemed to be the employer, so the

receiver of the services is the deemed employer and

Clancey, in fact, is the deemed worker, but he is only

the deemed worker because we have again got a

tripartite situation; but that analysis suffers

from the same vice as all the others in that if you

look at it from the other viewpoint - no you do not.
I am sorry, I withdraw that. Because they are three

it does not have the vice, but it is all unnecessary in the end because, naturally enough, Clancey being a

true worker for his own company, and there is no

doubt about that, the levy is paid in respect of him,

and that appears from the evidence at page 114 line 11.

If I might just take the Court to that, Mr Clancey

describes his business in an affidavit and the

relevant part is on page 114, paragraph 11 at about

line 11:

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. C2T5 l /1 /HS	91
Accident(2)

Since September 1985 the company -

that is to say his company, BDC -

has paid the Workcare levy in respect

of my wages including for periods when

I was engaged in work referred to the company by Troubleshooters -

and he exhibitssome documents. His wife, who is also

an employee, has her levy paid in respect of her.

So that, in our submission, a quite odd result would

apply if that were the case. The other oddity is this,

that although levy/revenue authorities may no doubt

have many targets, this is a very strange situation

where they.do have a target and assuming there is

in truth a target here and that no exceptions apply

and that there are other possible targets, is it a

likely legislative intention that they should pick

and choose according to criteria that may be completely

arbitrary, and section 9(5) provides no answer to that

question. Indeed, it provides no answer to the problem

that we say arises of double liability and the point is,

in our submission, important, and it is this;

section 9(5) only operates to avoid double liability

for liability accruing outside section 9 itself.

If you get double liability under section 9 it is a

toss of the coin for the commission to decide who it

wants to make pay first.

That, in our submission, appears from the terms

of section 9(5) itself, on examination. It provides:

Where, in respect of a payment for or in

relation to the performance of work that

is deemed to be remuneration under this

section, a levy is paid by a person

deemed under this section to be an

employer -

(a) no other person shall be liable to

a levy in respect of that payment.

(Continued on page 93)

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MR BLACK (continuing):  Now if you have got two of those

people being deemed, the section does not give

you an answer. It must only operate where you

have got an external liability and a deeming that

corresponds with the external liability. But

given two liabilities internal to section 9, the

section does not help you, which is another reason

why we say the - one puts a lot of s's; -the

sound symmetrical and sensible result that is

now conceded does work, is in fact the only result.

Would the Court pardon me a moment, there is just

one other point.

MASON CJ: Yes.

MR BLACK:	Yes, I am reminded that the section 9(5) only
operates where the levy is actually paid. It says nothing of liability which attaches, I think it is section 200 of the Act, in the circumstances
where there is an employable employer who has
leviable remuneration. So it does not solve the
problem of liability. It just seems to say that
if somebody actually pays the levy then everyone
else is off the hook, as it were, unless there is
some evasive purpose by the payer. Now, again we
say that is not a sensible result. Underlining all
our arguments to the lack of sense of it is, in
our submission, no impermissible element. We are
simply saying that if these are the results it
could not have been the legislative intention.
We are not going into impermissible areas, but simply putting that in accordance with the cannons of construction and of course, in this case, this,
as we would see it, is implicit that the appellant
would concede that if the exceptions do not apply, the builder will be liable for the levy, but they
say that TSA ought to be liable to, and that is a bizarre result, in our submission, in legislation that has, as its focus, discretionary revenue, and
certainly as an element in it, the social purpose
of compensating particular classes, we would say, limited classes, of deemed workers.

MASON CJ:	How does section 9(5) work in Mr Clancey's case,
for example, on your analysis of it?
MR BLACK:	On our analysis of it, Mr Clancey, if in fact the Troubleshooters or the builders as a deemed employer, on whatever view one takes, actually pays it, then
Mr Clancey's company has been wasting its money paying
it for Mr Clancey, even though section 200 of the Act
or the machinery sections, would tell it that it should
do so, subject to all sorts or penalties and pains
and so forth.

C2T52/l/CM	93	4/5/90
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MASON CJ:	Any right to contribution?
MR BLACK:	I think there is, Your Honour.  I think there is
a contribution section.  I think it is in parts 7,
and I think it is around about - I do not have
it at my fingertips, Your Honour, but I believe it
is - - -
MASON CJ:	215 "Contributions from persons jointly liable".
MR BLACK:	Yes there is one.  So that they are each:

liable for the whole levy -

but then their contributions, but of course

section 9(5) simply operates by virtue of payment,

where a person is in the situation of a deemed

employer.

MASON CJ:	215 operates with respect of joint liability.
Would there be a common law right to contributions in the case of those whose liability is not joint, but none the less concurrent?
MR BLACK:	I do not know, Your Honour. Your Honour has bowled me.
MASON CJ:	You do not know the answer?
MR BLACK:	I just do not know, Your Honour, and I am not sure
which answer - if Your Honour would pardon me, I
just do not know. It is for those reasons that we
say the Full Court was correct and it makes sense,
works and the other attempts to get a levy from
a party beyond that, which it is,subject to exceptions conceded,is liable and falls into great
difficulties which under score the correctness of
the Full Court's approach.

(Continued on page 95)

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MR BLACK (continuing):  Subject to one thing: MACKINTOSH's

case does, we would agree with our learned

friends, contain an apparent inconsistency of

approach because there is a type of person, in

MACKINTOSH's case, who can recover under

section 9(l)(b) even in the absence of a tripartite

situation, a situation the Full Court would have

denied, and did deny, in respect of a section 9(l)(a)

person. We would be bound to say, respectfully,

that the analysis should flow all the way through.

We draw that to the Court's attention merely

because there is that matter in MACKINTOSH's case -

it is a decision of the Full Court of the

Supreme Court of Victoria. It does not matter to

our argument here but I should mention that to the

Court.

For those reasons, we submit that the appeal should not be allowed. May it please the Court.

MASON CJ:  Thank you, Mr Black. Yes, Mr Larkins?

MR LARK.INS:	If the Court pleases, in our respectful submission, the fact that a complicated and sophisticated series
of provisions such as we find in section 9, when applied to one set of facts leads, in effect, down
a dead-end does not, in our respectful submission,
mean that when it is applied to a different set of
facts which lead somewhere that it should be given
some operation to give it, in effect, an artificial
dead end. There is no rule of statutory
construction of which we are aware which requires
symmetry, elegance, perfection of form and shape and any of the other wondrous qualities which my learned
friend would demand of us.

The fact that there may be oddities in

applying the particular statutory words to one set

of facts, in our submission, is not an answer to the
case which we make that where the target can be

centrally aligned on the words of the section as

they appear, not in one situation only and we have

always accepted that in certain tripartite

arrangements it plainly is the case that there is

a target in a sense central to the words of the

section. But if there is more than one target on

another application to a different contract, there is

no justification, in our submission, for an

artificial reading down in some way, the introduction

of a requirement which is not there, which is not

stipulated in the language.

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MR LARKINS (continuing); In our respectful submission,

that is exactly what my learned friend was seeking
to do and, in our submission, the fact that in

certain circumstances there may be two employers

is a matter of no consequence. It is just an

oddity and does not detract from the plain meaning

that should be given to the words.

Could I just say a word about the factual

situation. In our respectful submission, the way

in which this case was conducted is as indicated

by Mr Justice Gray in his judgment on page 2 -

it is 199 over to 200.	The argument which my learned
friend put was that there was no contract.	He

did not previously advance some argument that there

was a more limited contract requiring only

attendance at site, hence the way in which the
case was conducted below has not highlighted any

evidence which there might be going beyond those

features which appear in the appeal book.

Our respectful submission is that it is a -

I was going to say absurd which perhaps is overstating it but it is difficult to conceive

of a contract under which a builder requires a

workman on a particular day to advance his

building work, a man who might be quite critical

to the progress of the building at that time, a

scaffolder that may be required to erect a scaffold

on which the next part of the building work is

to be dependent, who is entitled to come that

morning saying, "I don't like the look of the

weather today", or "I don't like this particular

foreman" and walk off site without doing any of

his scaffolding functions.

In our respectful submission, his obligation, once he has accepted the work is not only to attend but to carry out the undertaking, in effect, of

TSA to cause a workman who can advance the work to be available on site to achieve that result.

McHUGH J: That is contrary to the sworn evidence at

page 33 of the record, is it not, that he can work

as long as he wants to?

MASON CJ:  Towards the bottom of the page - the second

paragraph at the bottom of the page.

McHUGH J:  "As long as the contractor wishes".

(Continued on page 97)

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MR LARKINS: That, in our respectful submission, really means

no more than that he is required from day to day,
not on a given day. We would not be suggestirs

for a moment, Your Honour, that if he had undertaken

to go there for a day that he would be required

to stay there forever and, indeed, even if the

builder then required him from day to day.

But in our respectful submission, that does not'mean that he is to, within the terms of an

engagement which is accepted, have the right to

withdraw after five minutes or something of that

sort. It just does not make sense that a builder

who was waiting for a painter could have his

whole site held up while somebody came and said,

"Well, I do not like the look of this" after two

or three hours.

McHUGH J: There may be some line of action against TSA?

MR LARKINS: Well, not, with respect, the - it really does

depend, of course, on the terms of the particular

engagement. One would suppose that there would be

a sort of trade usage that either you normally

engage day by day or week by week, or I would have

fancied perhaps forward performance of a particular

class of work on a building site from, as one·

would know, the erection of, say, a common structure.

There would be a certain time during which
plumbers would be required on site and the builder
would presumably require a plumber during that whole
period and it would obviously make sense that

if he had the same plumber throughout he would not

have the learning curve of learning where the crib

shed was and where the toilets were and where you

washed your hands, that you would want a man who

was familiar with the site, and as, I think, it is

known as a learning curve, the degree of efficiency,

and obviously enough the same person would be

preferred during the whole of the period. We would

the distinction, with greatest respect, between

the situation where, as one would suppose, "Please

go to X site tomorrow" would carry without more,

in our respectful submission, that that is there

for the whole of the day or until earlier on that

day the whole of the carpentry work, or whatever it is,

is concluded.

But in our respectful submission it is a very long bow to draw a conclusion from a statement

of such general terms that the contractor is entitled

to leave the site after five minutes, in our

respectful submission. The terms of the express

agreement, the written agreement, are clearer: that

he agrees to clear the work which he has agreed to do,

and that is borne out, in our respectful submission,

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by the finding of the trial judge commencing

at line 9 on page 199 over to line 25 on page 200.

There is a paragraph that is of no immediate concern in between there, so that we would be

relying on the fact that the trial judge has

found in the evidence which has been given and

it is a finding which is supported by that

evidence and by common sa-ise, in our respectful

submission. If the Court pleases.

MASON CJ:  Yes, thank you, Mr Larkins. The Court will

consider its decision in this matter.

AT 3.27 PM THE MATTER WAS ADJOURNED SINE DIE

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