Apostolidis v Victorian WorkCover Authority
[2012] VCC 1529
•11 October 2012
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CIVIL DIVISION | Revised Not Restricted Suitable for Publication |
DAMAGES AND COMPENSATION
WORKCOVER DIVISION
Case No. CI-11-05305
| GREGORY APOSTOLIDIS | Plaintiff |
| v | |
| VICTORIAN WORKCOVER AUTHORITY | Defendant |
---
JUDGE: | HIS HONOUR JUDGE PARRISH | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 6, 7 and 24 August 2012 | |
DATE OF JUDGMENT: | 11 October 2012 | |
CASE MAY BE CITED AS: | Apostolidis v Victorian WorkCover Authority | |
MEDIUM NEUTRAL CITATION: | [2012] VCC 1529 | |
REASONS FOR JUDGMENT
---
SUBJECT – ACCIDENT COMPENSATION
CATCHWORDS – whether plaintiff was a “worker” at time of injury – nature and extent of injuries – extent and duration of any incapacity
LEGISLATION CITED – Accident Compensation Act 1985; s5, s8, s9, s10A; Accident Compensation Legislation Amendment Act 2010, s27
CASES CITED – Arnotts Snack Products Pty Ltd v Yacob (1985) 155 CLR 171; Elazac Pty Ltd v Shirriff [2011] VSCA 405; Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16; Humberstone v Northern Timber Mills (1949) 79 CLR 389; Hollis v Vabu Pty Ltd (2001) 207 CLR 21; Australian Mutual Provident Society v Chaplin & Anor (1978) 18 ALR 385; Elazac Pty Ltd v Shirriff [2011] VSCA 405; Kovacic v Henley Arch Pty Ltd [2009] VSCA 56; Melbourne Metropolitan Board of Works v Smith (VSC, unreported, 20 March 1991).
JUDGMENT – for the plaintiff
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr A J Saunders | Slater & Gordon |
| For the Defendant | Mr D W Podger | Herbert Geer |
HIS HONOUR:
Introduction
1 Mr Gregory Apostolidis, who I shall refer to as “the plaintiff”, claims compensation pursuant to the provisions of the Accident Compensation Act 1985 (“the Act”) for personal injuries suffered by him on or about 26 March 2010 in the course of his employment with Lianou Building Constructions Pty Ltd, which I will refer to as “Lianou”.
2 I was informed from the Bar table by counsel for the defendant (the Victorian WorkCover Authority) that Lianou went into Court ordered liquidation on 7 June 2010. Although the original Writ was issued against Lianou, leave was granted without objection for the proceeding to be brought against the Victorian WorkCover Authority.
3 Counsel for the defendant also informed the Court that the issues in dispute were:
(a)Whether the plaintiff was a “worker” within the meaning of the Act employed by Lianou at the time that he suffered injury on 26 March 2010. The position of the defendant is that the plaintiff was engaged by Lianou as an independent sub-contractor;
(b)If the plaintiff was a worker at the relevant time, there would be no dispute as to the occurrence of injury. An issue would arise as to the extent and duration of any incapacity resulting from or materially contributed to by such injury.[1]
[1]T 16, L18 – T 17, L23
4 The plaintiff, Dr Oresti Mellios (the treating general practitioner of the plaintiff), and Mr Arif Melkic (“Melkic”) (a qualified carpenter), all gave evidence and were cross-examined. The parties tendered various documents.[2]
[2]See Annexure A
The Evidence of the Plaintiff
(a) The Background of the Plaintiff
5 The plaintiff is a forty-three year old (born in 1969) single man who left school in 1986, having completed Year 11. In the early 1990s, he commenced a Bachelor of Economics at La Trobe University but ultimately did not complete that course.
6 In or about 1994, he performed further study involving a real estate agent’s course and thereafter, on a part-time basis, completed a Bachelor of Business in Property at the RMIT. After completing the Bachelor of Business, he then completed a Diploma of Building, and later a Certificate IV in Construction, all of which was done part time over a period of five years from approximately 2003 to 2008.
7 Over the years, he has worked in retail, performed some labouring work and has been involved in what he referred to as the “family business”.
8 The family business is Pinecore Pty Limited. The plaintiff described such company to be involved in property management and also leasing of properties. When asked what activities he undertook with Pinecore Pty Limited, the plaintiff stated that when performing part-time studies:
“I was just doing pretty much property maintenance and occasionally some - I'm not sure if the correct wording is casual leasing, but if a property would come up available then we would lease it - rent it out.”[3]
[3]T 23, L7-12
9 The plaintiff further described that he was one of four shareholders in Pinecore Pty Limited, together with his sister, mother and father. A perusal of the ASIC documents[4] would suggest that the mother and father of the plaintiff are the directors of such company.
[4]See Exhibit C at pages 114-115 DCB
10 The plaintiff gave evidence that he performed some labouring work for Pinecore Pty Limited but the majority of any labouring work he performed was for LAS Constructions which was operated by his cousin and which performed construction work in the building industry. He estimated that 99 per cent of his time performing labouring work was with LAS Constructions, which was involved in the construction of houses and townhouses.
11 In 2006, the plaintiff set up his own company, Gregory Constructions Pty Ltd. When queried as to why such company was commenced, the plaintiff said:
“I thought it – what I really wanted to do is just build for myself.”[5]
[5]T 25, L22-23
12 In 2008, the plaintiff obtained a builder’s licence which he described to mean:
“It means that I am a registered building practitioner and for me to enter into contracts with - sorry, enter into contract with a client, which wasn't my intention anyway, to build for other people, but I can build for myself a townhouse, a house, a building to that effect.”[6]
[6]T 26, L23-29
13 In or about 2008 or 2009, the plaintiff purchased a property in Frankston and built three townhouses for himself. It was his intention to build such townhouses as an investment and to rent them out and to live in one of them. The townhouses have been completed but none had been sold and all three are let out. In particular, the plaintiff gave the following evidence:
“Q: Approximately how long did that project take?---
A: Approximately 18 months or thereabouts. About 18 months. Yes, I would have to say about 18 months, maybe 19.
Q: So having started in or about 2008, that job probably ran through until 2010 or thereabouts?‑‑‑
A: Sounds about right.”
HIS HONOUR:
“Q: You were on site all the time?‑‑‑
A: On that particular job, yes, I was.
Q: What, that you were the - you were the major man on site?‑‑‑
A: Correct.
Q: Then, what, would you have subbies coming in, doing particular ‑ ‑ ‑?‑‑‑
A: I would have contractors coming in, or subbies coming in, depending on the job, and that's what we would have - or which I also did a lot of the work myself. So jobs that I couldn't do, I would have to contract them out or get a subbie.
Q: Yes?‑‑‑
A: To that effect.
Q: The events in question, as I understand it - well, the incident happened in March 2010 and I think whatever arrangements you had with Lianou Building were occurring late 2009. I just want to get this correct. At the time that you entered into any relationship with - come to relationship later - but whatever the relationship was with Lianou Building Pty Ltd, had the construction of the townhouses in Frankston been completed?‑‑‑
A: Correct.
Q: So that was, for want of a better word, a done job?‑‑‑
A: Correct.
Q: You were looking for further activity?‑‑‑
A: I was trying to find work. I would have been glad to work. Actively - if somebody came up and mentioned, you know, "Would you like to do a job," if I wasn't doing anything, then, yes, but did I actually go out and actively seek work? No. Never advertised or never put myself on the Internet, for example. Never gave out business cards; I didn't have any business cards. I never actually went out looking for work. My intention wasn't to build for other people, not to, you know, to use my licence. My licence was there for myself to build for myself personally. So I can find a block and buy and build and rent them out. That was the intention. If I had to sell, then, you know, I would have to sell.
Q: Just so I'm quite clear about that, and it may or may not be important later: as a registered building practitioner, as you've explained to me, it gives you the right as an individual through your company to construct things. You certainly didn't need that particular qualification to go out and be, like, a builders' labourer or anything like that?‑‑‑
A: No. Correct; no.”
MR SAUNDERS:
“Q: So has Gregory Constructions since done any other jobs?‑‑‑
A: No.
Q: What plans did you have for Gregory Constructions?
A: Well, I was hoping to continue what I did in the case of Frankston; buy another land or land with plans and permits and to construct, to build.”[7]
(b)The Circumstances Leading to the Plaintiff Performing Work for Lianou
[7]T 28, L20 – T 30, L10
14 The plaintiff gave evidence that he was approached by Melkic and asked whether he was interested in working on the job site of a mutual friend. Melkic was a carpenter who had worked on the plaintiff’s townhouse site in Frankston performing carpentry work.
15 The plaintiff believes he was approached by Melkic in late November or early December 2009 to perform framing work at a site in Keith Avenue, Aspendale.
16 The plaintiff explained that the term “framing” refers to stick framing where you actually “knock up” the frame for a house and perform all the timber work. In the circumstances of the Keith Avenue site in Aspendale, the concrete slab had been poured and it was necessary to place the framing for two townhouses to be built on that site. He also gave evidence that he had had experience putting up framing, both when he constructed his Frankston units and also when working for LAS Constructions.
17 The builder of the townhouses on the site was Lianou, which was a builder in the building and construction industry, and run by Mr Steve Lianou.
18 When asked about his understanding as to the basis on which Lianou would engage him – that is, as an employee or sub-contractor – the plaintiff answered:
“Sub-contractor”.[8]
[8]T 33, L12 – 15
19 When asked about how he was going to be paid for his work, the plaintiff gave the following evidence:
“Q:In terms of how you’d be paid, what was your understanding?---
A:I understood it was to be an hourly rate.
Q:Well, when you say you understood that, how did you understand that?---
A:I just understood that we were going to be working there on an hourly rate. The job was going to be taking approximately four weeks or thereabouts. Hopefully if everything went to plan we should have finished in four weeks and gone home, but unfortunately it didn’t work out that way because I believe the builder had other problems, looking back in hindsight now.
Q:Well, just so – I go back to this conversation with Mr Arif in either November 2009 or early December 2009. As I understand what you’ve told the court so far is that Mr Arif arranged with you whether you and he would be – or he – you join him or together you go to the site, Keith Avenue, and do this construction or the framing work, I should say, in relation to these two townhouses. Did Mr Arif raise with you at that time or at any time the method of payment?---
A:I believe yes, and I believe that it was an hourly rate.
Q:How much were you going to be paid?---
A:For myself $65 an hour. That’s the rates that I charge out. Now, I believe what I understand is that Steve had approached Arif and Arif told him it’s a big job because there were two triple storey houses or townhouses. So there was, you know, a bit of work in there. Arif had told – what I understand is Arif had told him he couldn’t do it for himself, can he ask somebody else to work with him. What I understand Steve Lianou said, ‘Yes, can I ask Greg?’ He said yes. So he approached me and I said, ‘Of course’, you know, ‘why not?’.”[9]
[9]T 33, L16 – T 34, L16
20 The plaintiff gave evidence that he “didn’t think about it at all” in respect to any payment of superannuation, sick pay and holiday pay.
21 He further gave evidence that when he performed such work, he was “supervised” by someone called “Dennis” who was employed by Lianou. Dennis would make “fleeting visits” about once a week to check how things were progressing at the site.
22 Although the job for Lianou was supposedly to take about four weeks, there were many times when the plaintiff and Melkic would arrive at the site ready to work and there would be no materials available to undertake the work. On occasion Melkic or he would ring “Dennis” to see where the materials were for the work to be undertaken.
23 The plaintiff gave evidence that he actually worked at the Keith Avenue site on the following days:
·Tuesday, 15 December 2009 from 7.00 am to 6.00 pm
·Wednesday, 16 December 2009 from 7.00 am to 6.00 pm
·Thursday, 17 December 2009 from 7.00 am to 5.00 pm
·Saturday, 19 December 2009 from 7.00 am to 5.30 pm
·Monday, 28 December 2009 from 10.30 am to 1.30 pm
·Wednesday, 30 December 2009 from 7.00 am to 1.00 pm
·Monday, 1 January 2010 from 7.00 am to 7.00 pm
·Tuesday, 5 January 2010 from 7.00 am to 5.00 pm
·Wednesday, 6 January 2010 from 7.00 am to 5.30 pm
·Thursday, 7 January 2010 from 7.00 am to 5.30 pm
·Friday, 15 January 2010 from 8.00 am to 5.00 pm
·Wednesday, 20 January 2010 from 8.00 am to 1.30 pm
·Tuesday, 16 February 2010 from 7.30 am to 6.00 pm
·Wednesday, 17 February 2010 from 7.30 am to 4.00 pm
·Thursday, 18 February 2010 from 7.30 am to 4.30 pm
·Friday, 19 January 2010 from 7.30 am to 1.00 pm.
24 In particular, the plaintiff gave evidence that his company, Gregory Constructions Pty Ltd, had nothing to do with any arrangements with Lianou and, furthermore, he did not perform any other work over the period that he was engaged by Lianou.[10]
[10]The days and hours that he worked are set out in Exhibit 1, a notebook prepared by the plaintiff
25 During the course of such work at the Keith Avenue site, the plaintiff was asked on occasion to assist the steel fabricators who were putting in place steel columns and beams. In particular, the plaintiff gave evidence that he and Melkic performed activities as requested by Lianou. In particular, he stated:
“A:… Lianou Constructions. They requested that we would put in some deep span joists, beams and to lay – or to expand the deep span joists, I remembered this and to also lay – extend the cement sheet flooring, which was approximately 20 millimetres thick. So whatever they required us to do.
Q:That what you’ve just described, is that something beyond what a builder would normally refer to as framing work, or is it part of framing work?---
A:It’s also part of framing work.
Q:Evan the laying of the extra concrete?---
A:No, it’s compressed sheeting. It’s compressed sheeting flooring, so we were doing that, but then they said, ‘Listen, there’s been changes. Can you do this?’ and of course we said yes. You know, we did what we were told”.[11]
[11]T 45, L25 – T 46, L9
26 The plaintiff wrote his hours down and gave it to Melkic to give to Steve Lianou. He had the expectation that he would be paid when the job was finished.
27 Consistent with all carpenters, the plaintiff supplied his own hammer, tape, circular saw, nail guns and nail belt. Lianou would bring a truck with timber on site and hoist the timber to the required area. If he and Melkic got to a certain point and needed more timber, one of them would ring Dennis, who would organise the truck to deliver more timber with the hoist. Neither he nor Melkic organised for the truck or hoist to attend the site. The infrastructure on site, including the fencing and the toilets, were provided by Lianou. At no time did either the plaintiff or Melkic hire staff to assist in the performance of the work undertaken.
28 The plaintiff also gave evidence that he could have worked elsewhere, on those days when materials were not available at the Keith Avenue site, but he chose not to. However, he believed that Lianou would have expected him to be available to perform work at the site on any of the days that materials were available for work to be undertaken. The plaintiff also gave evidence that there was no particular time he was directed to start work but generally work was commenced about 7.00 am.
29 In particular, the plaintiff gave evidence about certain events occurring in February 2010. In particular, the following evidence:
“Q:There was a discussion between Mr Melkic and Mr Steve Lianou?---
A:Yes.
Q:What do you know, if anything, of that discussion?---
A:What I understand is that Arif had gone down with the hours that I assume that we had – and I am sure he would have had his hours down as well – that we had worked and they had a discussion about, you know, concerns that we had about the job site. We weren’t happy about the situation and, you know, it was a concern that we both had and I think we were justified and what we were going to do about it, you know, the problem of us turning up and so forth. I wasn’t there at the discussion, what they would have possibly talked about, but then Arif had come back to me and said, ‘Listen, we’re going to change it to work out a fixed price per square metre,’ and I thought, yes, well, you know, as long as we can try and get, you know – try and finish the job or, you know, try not to waste our time any more because that’s basically what had happened over the period of time. Again I should have, looking, you know, just – I don’t know. I was pretty easy going, pretty – you know, I was flexible looking back at it and looking back at it now I just wish I walked away.
…
Q:So whatever the number of hours you were still anticipating to get $65 an hour?---
A:No, I think there was a complete change which we – what I understand is that all the hourly rate that I work in the past would be gone and we’ll be getting a square - - -
Q:So much?---
A:So much and then I suppose Arif and I could talk about how many hours we worked and all that sort of stuff. I don’t know why we changed that.
Q:Just on that so some time in February the ball game changes to this extent - - -?---
A:Correct.
Q:- - - that whereas your belief was that you were working for $65 per hour as at some time in February it changed that whatever had gone in the past that was no more relevant, but you were going to be paid on a the basis of a fixed price per square metre of framing?---
A:Floor area, correct, or floor area/framing, correct. Floor area.
Q:Floor area?---
A:Correct.
Q:Now - - -
A:Or was it framing?---
Q:- - - were you going to be paid each of you a certain price or was the situation that you and Mr Arif were going to be paid an amount of money jointly as it were for a fixed price per square metre?---
A:I suppose we would have probably – requested each of us to be paid our own amounts. Arif and I would probably – I’m probably guessing now, but at the end of the day I would have said, ‘Listen, this is the amount of time or hours that I worked. This is how much I expect,’ and Arif would have done the same, so would have tried to divvy up the or, you know - - - ”[12]
[12]T 51, L7 – T 52, L31
30 The plaintiff considered that he would have been better on an hourly rate rather than a rate per square metre considering that you never know how long a job may take.
31 The plaintiff made no further notes of the number of his hours that he worked after 19 February 2010. However, he gave evidence that, prior to his fall on 26 March 2010, they were working more frequently as the materials were coming on site on a frequent and proper basis.
32 Generally, the plaintiff worked with Melkic and although the type of work can be done with one person, it is more efficient with two people. Accordingly, each of them would arrive about the same time each morning and work together during the day.
(c) The Circumstances of the Injury Suffered by the Plaintiff
33 The plaintiff said that on Friday, 26 March 2010, he was working at the site with Melkic and they were constructing the flooring on the concrete slab of the ground floor. In particular, they were laying red tongue chipboard. The ground floor had a “void” of about 3 metres wide by about 4 metres long.
34 When performing such work, he fell through the void approximately “3 metres plus”. Although not certain, he believes he struck his back and head. When laying on the ground, he experienced “intense pain” in his right little finger and his low back. He was conveyed by ambulance to the Frankston Hospital and later to The Alfred Hospital, where he was an inpatient for four days.
35 On discharge from hospital, he came under the care of his general practitioner, Dr Oresti Mellios, who in turn referred him to the neurosurgeon, Mr Myron Rogers. Later, Mr Rogers referred the plaintiff to the pain management specialist, Dr Brian Anthonisz. At some stage, he has also been referred to a specialist physiotherapist, Dr Kate Murray.
36 On discharge from hospital, he was experiencing a lot of pain in his low back in the region of the coccyx, and also pain in his right little finger which had been fractured and dislocated. On leaving hospital, he was offered opiates to control the pain but chose to take Panadol. He returned home to live with his parents, where he continues to live. Prior to the fall, he enjoyed good health.
(d) Subsequent Employment of the Plaintiff
37 In August 2011, the plaintiff resumed work as a casual and part-time teacher at the Holmesglen TAFE, where he continues to teach Certificate IV Building and Construction. He works about eight hours a week over twenty five weeks of the year. However, there are variations, and he believes he works approximately 200 hours a year and is paid $75 an hour. Other than that work, he has not performed any other type of work since the fall. In particular, other than his income from Holmesglen TAFE, he has no other income from personal exertion.
38 The plaintiff gave the following evidence in relation to his general capacity for employment:
“Q:What do you say about your capacity to return to the framing work you were doing for Lianou?---
A:To go back to framing?
Q:Yes, could you do that?---
A:No.
Q:Why do you say that?---
A:Pain, my body is not able to take it, physically no, not anymore.
Q:You’re now working part-time as a teacher at Holmesglen?---
A:Correct.
Q:How is that going?---
A:I really enjoy it. In fact, I really do enjoy teaching but it does take a toll on my body. I had a discussion with my boss who goes by the name of Annette O’Connell. We may actually try and change the hours that I work because eight hours a week is just, at the moment, causing me too much grief”.[13]
[13]T 74, L3-15
39 The plaintiff also asserted that Holmesglen TAFE had offered him more work but he “can’t take it”. At present he is doing four hours a night on two nights a week and he does “struggle” performing that work.
(e) The Taxation Returns of the Plaintiff
40 In evidence-in-chief, the plaintiff was questioned about his income taxation returns. I refer to Exhibit 5, which consists of the plaintiff’s income taxation returns for the financial years ending 30 June 2008, 30 June 2009, 30 June 2010 and 30 June 2011.
41 In particular, I refer to the income taxation returns for the years ending 30 June 2010 and 30 June 2011. In the first of those returns, it is recorded that the plaintiff was employed by Pinecore Pty Ltd as a building and construction manager who earned $5,876.00 gross wages and a bonus of $138,000. From those sums are deducted sums for interest, capital works, gross rent and other rental deductions. In particular, there is a deduction for motor vehicle expenses of $7,611.00, ultimately leaving a taxable income of $84,712.00.
42 The income tax return for the year ending 30 June 2011 similarly records that the plaintiff was employed by Pinecore Pty Ltd as a building and construction manager who earned $5,876 gross wages and a bonus of $179,000. From those sums are deducted various rental expenses. Again, there is a claim for motor vehicle expenses of $5,473, ultimately leaving a taxable income of $118,796.
43 The plaintiff gave the following evidence:
“Q:Your tax return suggests you performed some work for the family business. What do you say as to that?---
A:No.
Q:You haven’t?---
A:No.
Q:Why do your tax returns suggest otherwise?---
A:Because our accountant has set up the structure – that’s how we had set up before the accident.”
HIS HONOUR:
“Q:Do you know whether there’s a family trust?---
A:No.
Q:How does the money get distributed to you?---
A:It gets distributed to me – the way I understand it is that we’ve got – I have property which I own which is under my name which instead of coming directly to me it just goes to the family business or the company and then gets dispersed from there.
Q:For argument’s sake the three townhouses which you built off your own bat, I think you told me earlier they’re let out to tenants?---
A:Yes.
Q:Who gets the rental income?---
A:I believe it goes to - - -
Q:You’re not sure?---
A:I’m not sure but I believe it may go to Pinecore. I believe it goes to Pinecore. I’m just not sure.
Q:Do you own other assets like that?---
A:Yes, I do.
Q:You personally?---
A:Yes, I do.
Q:You have rental income from those assets?---
A:Yes, I do.
Q:That again goes into Pinecore?---
A:Yes, it does.
Q:Other than the – no doubt you might be asked some of these questions so it’s probably best I ask them initially. Other than the three townhouses approximately how many other properties would you have income from?---
A:Seven, I believe, seven.
Q:Seven, including the three or seven extras?---
A:Seven, correct.
Q:Including the three townhouses - - -?---
A:Yes, correct”.[14]
[14]T 63, L28 – T 64, L27
(f) The Present Condition of the Plaintiff
44 The plaintiff continues to experience pain all or at least most of the time, although such pain varies in intensity. Low back pain does refer to his legs and, in particular, his right leg, where he has pain in his foot, and, in particular, under his foot. He finds that sitting down makes his pain worse, although by lying down such pain is eased.
45 His neck is stiff and he gets headaches and pain in his right arm. He avoids lifting his arms above shoulder height.
46 He experiences headaches every couple of days and has some degree of buzzing in his right ear which he never had prior to his fall. Furthermore, he has some difficulty with his vision and also has what he referred to as “vertigo” where he feels “uneasy” and the room seems to be “spinning around”.
(g) The Present Treatment of the Plaintiff
47 He attends his general practitioner, Dr Mellios, about once a month and although he has been prescribed medication for his vertigo, he could not remember the name of such tablet. He also takes Panadol for pain, and over the last year or so has been given other types of medication from Dr Mellios or from the pain specialist, Dr Brian Anthonisz.
48 He was attending Dr Anthonisz about every month but it has been some three months now since he has re-attended. Dr Anthonisz gives advice about pain management. He has not been back to the physiotherapist “for a while” because it was not really “doing much”.
(h) The Cross-examination of the Plaintiff
49 Under cross-examination, the plaintiff acknowledged that although he had no formal carpentry training as such, by working in the building industry he has picked up a lot of different skills. He accepted that he had been working in the building industry on and off since 1995 and full-time since 2000. Over that period of time, he has asserted he has done such work as tiling, concreting, general fixing, all of which touches on different trades.
50 The plaintiff confirmed that he is not a qualified carpenter and to become a qualified carpenter it is necessary to undergo an apprenticeship which he believed was of about four years duration.
51 When queried about what is required to become a registered building practitioner, the plaintiff gave the following evidence:
“Okay. You must complete either a minimum – what I understand a minimum – certificate for builder, construction. I’ve completed that and I also completed a building diploma, must show that you’ve got experience in the building industry, not necessarily framing, as long as you have experience in the building industry. They prefer a minimum of three years and you sit the board – sorry, you sit, put in your application to the Building Practitioners Board. Then you sit a (sic) examination with one of the Building Practitioners Board members and they ask you questions relevant to – it’s a very big, broad area, but they ask you only questions in regards to building structures, in regards to building contracts and so forth.”[15]
[15]T 83, L15-28
52 The plaintiff accepted that he is a “skilled operator on the tools” within reason, but cannot perform everything (for example, plumbing work or electrical work). Although he accepted that he was good at “framing”, he was not so good at fixing, skirts, architraves, doors and the like.
53 Over the years that he has been involved in the building industry, it has been mostly with domestic building projects. When pressed, he stated that for the “most part” he had been doing carpentry work or building work for other people, the plaintiff answered:
“A:I suppose where I could find work I – to go back and see who I actually worked for now, I'm pretty sure it was pretty much for myself and Archie. Looking back did I do bits and pieces? I probably did, but not – it wasn’t really such – I wasn’t known as Greg the carpenter or Greg the framer or so forth.
Q:But when you say working for yourself does that mean you considered yourself self-employed?‑‑‑
A:Well, I would like to build as a – for example, with Frankston – sorry, purchase a property building to for myself as in, you know, for myself as an investment, organise the trades.
…
Q:I understand that. You’ve said that that was the only project you developed in your own right. Apart from that would you consider yourself self-employed as a contractor working in projects that belonged to other people?‑‑‑
A:I – such an interpretation. Would I say – I'd say probably no. Not really, no. How could I answer that?”[16]
[16]T 89, L1-7 and L16-21
54 When pressed as to how he would charge anyone for any particular work, the plaintiff stated in part:
“A:… I tend really not – when I'm employed with somebody else I'll come on site, you know, ‘Greg can you do this?’ ‘Yes, I can, and I'll do it.’ ‘Yep go for it. Do what you can Greg.’ That’s what I tend to do if I'll be working with somebody. But then I wasn’t really in the position where I will start quoting jobs as such. I didn’t put myself out there as Gregory the framer.
Q:So you’re saying you didn’t advertise?‑‑‑
…
A:I didn’t advertise. So I wasn’t really going out there saying, ‘Yes, I'm Gregory the framer, I'll do your tiling, I'll do this I'll do that’. I never did that. It was really from people working on site, for example I was pretty much stayed on. Like for instance when I was working for Archie, I'd be working there for Archie for a long period of time.
Q:When you worked for Archie were you working for wages?‑‑‑
A:Yes, I was.”[17]
[17]T 91, L2-20
55 Later, the following evidence was given in relation to his past experience of erecting framework:
“Q:Prior to this engagement with Lianou, had you ever been directly involved in being engaged to perform erection of the frames?‑‑‑
A:I had worked – for example, when I worked with Archie I might get a contractor in I would actually work with them as well. I'll pick up and learn. I wouldn’t be afraid. I enjoyed it so I’d work with other trades. Generally that’s what I did.
Q:Leaving aside Archie, when you were working for wages for him, did you ever prior to this engagement with Lianou actually enter into any contract or any relationship with anyone else where you held yourself out to be a framer?‑‑‑
A:No. Definitely not. As a framer no.”[18]
[18]T 91, L27 – T 92, L7
56 When queried about his tax returns and in particular the claim for motor vehicle expenses, the following evidence was given:
“Q:I suggest to you that’s consistent with a significant level of activity by you in the business of Pine Core. Is that a fair suggestion?‑‑‑
A:I think you can interpret that any which way. How my accountant’s structured – in any which way to say that there’s something sinister behind it, no. I think I've been honest in saying that – what Pine Core Pty Ltd does. You know, my dad would use the vehicle, which he does often. Other people in the family do, so to say that – I think I understand what you’re actually trying to say to get at, whether I've been actually working for Pine Core in their construction being a contractor and so forth. It’s not true, no.”[19]
[sic]
[19]T 107, L13-25
57 The plaintiff gave evidence that he was largely reliant on his accountant and the way his parents ran the business. In particular, he had no particular recall of any large sums being paid into his bank account and considered that any sums were put against loans which the family company employed to buy rental properties.
58 Later in his evidence, the plaintiff was pressed by counsel for the defendant about certain items in his tax returns. In particular, the following evidence was given:
“Q:Thank you, your Honour. Mr Apostolidis, your tax return 2010/2011 shows your occupation as building and construction manager. It shows that you have claimed a tax deduction for motor vehicle expenses in the amount of $5473. You’ve also said to the court a number of times that you were unable to work at all during the financial year 2010/2011. I put it to you that those two propositions are contradictory. One of them must be false. How do you respond to that?‑‑‑
A:Did I fraudulently mislead the ATO? I – if I have, then I left it up to my accountant and the advice – I left it up to the accountant to do. So did I fraudulently do it? It was all up to my accountant and that’s all I can tell you, I'm sorry. Did I fraudulently do? If I did, I apologise, but I've left it up to my accountant, I'm sorry.”[20]
[20]T 127, L17 – L128, L1
59 The plaintiff informed the Court that he considered that part of the “framing” activities included flooring and in particular laying the chipboard flooring. Also putting in the stud wall and what he referred to as the “posies” (which he described as an engineered piece of beam) and the chipboard which goes on top of the posy are all part of the framing activity.
60 He also agreed that there was no discussion or indeed any agreement with Lianou as to tax to be taken out of any moneys that he was to be paid, superannuation, sick leave, holiday pay or WorkCover insurance.
61 The plaintiff agreed that although he is living with his parents now, he had always lived with his parents prior to the fall. He also gave evidence that he believes that he applied for the job at Holmesglen TAFE maybe in November or December 2010 and it took about six months for the job to come to fruition.
(i) The Re-examination of the Plaintiff
62 Under re-examination, the plaintiff was again questioned about his tax returns, and in particular, the money said to have been paid by Pinecore Pty Ltd to him. The following evidence was given:
“Q:In distinction to the wages and/or bonuses paid by the family company?‑‑‑
A:I think you’re asking me where do I get my income from? It’s based on – I think that’s the question – on the residential income from our investment property.
Q:As it stands right now you get the income you earned at the teaching establishment?‑‑‑
A:Yes.
Q:You get some income from the Frankston properties - - -?‑‑‑
A:Yes.
Q:- - - and maybe some other properties?‑‑‑
A:Yes.
Q:I understand that, but I'm still not totally clear. To your knowledge do you get any moneys paid to you by Pincore other than by way of a weekly payment, wage or part bonus or - - -?‑‑‑
A:Weekly payment, no.
Q:At the end of the financial year do you get an actual payment?‑‑‑
A- - - I … do I get an actual payment? I don’t think so. I can’t explain how my accountant’s done it or whether it’s - - -
Q:I'm not so interested for you to explain how your accountant has done it?‑‑‑
A:Do I get a - - -
Q:All I'm say is that - - -?‑‑‑
A:Would I receive - - -
Q:- - - leaving aside what the family does or what the accountant does during a financial year – just take the last financial year, the last one, 2010-2011. So it finished a couple of months ago – sorry, I apologise, more than a year ago. Did you, at any time during that year, to your knowledge, actually receive $5,876 by way of – call it salary from Pine Core and/or 179,000 by way of bonuses from Pine Core?‑‑‑
A:No.
Q:The actual money?‑‑‑
A:No.
Q:So even though it goes in your tax return it’s a family – it’s under the umbrella of the family concerns, is it?‑‑‑
A:- - - Absolutely, yes.”[21]
[21]T 141, L12 – T 142, L12
The Evidence of Arif Melkic
63 Melkic was called on behalf of the plaintiff and described himself as an assistant site manager, working for a construction company and building 81 apartments. He confirmed that he was a qualified carpenter. Melkic described that to become a carpenter, he underwent an apprenticeship with a builder. Furthermore, he confirmed that he had done some property development over the time and when queried whether such work was similar to that as a carpenter, Melkic stated:
“Completely different. Carpentry is a labour aspect of erecting frames you lock up, which includes straightening the walls, putting your bath, showers in and stuff like that. Your fixing stages where you put your doors, architraves maybe new floorboards, stuff like that. So property development is basically getting plans for – submitting plans through council, sitting down with architects, organising trades people. Bar minimal, physical work, it’s more like paperwork, organisation, well, totally or just organisation skills are needed for that, and just dealing with basically every trade that needed on a construction site.”[22]
[22]T 163, L5-16
64 Melkic gave evidence of the agreement he entered into with Lianou. He gave evidence of a meeting with Steve Lianou:
“Q:Can you please tell His Honour how this agreement came to pass, how were you introduced to Mr Lianou?‑‑‑
A:The owner of the development which was Eddy Cajic and his business partner of Victorian Plumbing and Drainage. I've known Eddy since childhood. Steve, I was introduced to Steve at Eddy’s birthday party, we had dinner, I also met Greg for the first time. That was prior to – probably two years prior to the construction of Eddy’s place. When Eddy did purchase, we were at the auction of the purchase of the property. I'd basically said to Eddy, ‘When it’s ready to put the frame up then do all your carpentry aspect and make sure that I do it.’ When it came forth to doing the construction Eddy had a contract with Lianou Building. Steve had been trying to get me for about three years prior that to work for him, go and work for him. I always was working on myself and was subcontracting.”[23]
[23]T 163, L26 – T 164, L11
65 Melkic described Lianou as effectively the site managers undertaking the construction of the townhouses.
66 Melkic gave evidence that he reached an agreement with Lianou by which he would undertake the carpentry work at the Keith Avenue site and he would be paid a lump sum of about $19,800 after presentation of an invoice when the work was completed. He explained that when he referred to carpentry work, that included “putting the sticks on – the timber together”.
67 When queried as to how the plaintiff became involved in the project, Melkic stated:
“A:I am asked him to end if he would come and to the carpentry work, because I’ve seen him do carpentry work before on his own dwellings, on his own property, dwellings with his carpenter assisting, and so, yes, I basically asked him if he would help me to do at his – and because they were friends as well at the time.
Q:I take it that’s because it was a job for more than one person?‑‑‑
A:Definitely, minimum two.”
HIS HONOUR:
“Q:So was the agreement that when you brought Greg in - - -?‑‑‑
A:Yes.
Q:- - - was that from the word go, was it? You know, you went and saw Lianou and sorry, the principle (sic) - - -?‑‑‑
A:Eddy.
Q:Eddy and you came to an agreement that you’d do the carpentry work and that, let’s just call it 20,000 in round figures?‑‑‑
A:Yes.
Q:Then at that point did you go away then and bring Greg in or was it at a later - - -?‑‑‑
A:No, it was prior, because - - -
Q:It was prior?‑‑‑
A:Yes, well, maybe about a week before Eddy had asked me if I would do his frames, and our meeting with Stylianou was probably about a week. In the meantime I had asked, had asked Greg if he would help me, because there was no – well, I couldn’t do it on my own, so - - -
Q:I understand that.”
MR SAUNDERS:
“Q:What discussions did you have with Mr Lianou, if any, about Greg’s involvement?‑‑‑
A:None, just told – basically, said to him that me and Greg will be doing the frames on the construction.
Q:He agreed that that was okay?‑‑‑
A:Yes, yes.”
HIS HONOUR:
“Q:I guess from his end he was still paying $20,000?‑‑‑
A:Yes, he wasn’t paying any more, or any less, or – it was just - - -
Q:So he didn’t care whether 10 people worked?‑‑‑
A:No.
Q:It was still going to be $20,000?‑‑‑
A:Yes. Yes, it was basically that contract price in his contract. So basically what had happened, Eddy and his business partner Steve went – they did work for Lianou Constructions and did his plumbing, but they basically had a contract book and it just – basically had every stage in it, and at the end it had a figure of what the property was to be built at.”[24]
[24]T 170, L20 – T 171, L29
68 In February 2010, Melkic recalls receiving a telephone call by which Steve Lianou had requested details of the hours that had been worked on the job. Melkic was not sure why this was required, considering that from his point of view a lump sum was going to be paid for the completion of the work. He recalls that he told Mr Steve Lianou the number of hours that the plaintiff had worked. He had not kept any notes of the hours because he had “no reason to”. Subsequently there was a heated discussion between Mr Lianou and Melkic after which there was no change to the agreed sum to be paid for the work to be undertaken. Melkic also considered that from that point (that is, about February 2010), there were far fewer delays in getting material on site and work proceeded at a quicker pace.
69 During the time that he worked on site, Melkic was aware that someone from Lianou dropped in about “ten minutes once a week”. Melkic asserted they did not need any “direction” as they had been doing that type of work for thirteen years. If materials had to be “chased up”, Melkic would contact Steve Lianou.
70 If there were problems on the site, such as a toilet malfunctioning or difficulties with neighbours, Steve Lianou would be contacted to sort out the problem. Essentially, he and the plaintiff only did framing work or carpentry work on the Keith Avenue site. Melkic and the plaintiff supplied their own tools which consisted of nail guns, power saws, compressors, hoses, leads and ladders. Melkic referred to this equipment as a “carpenter’s kit” and also noted that any additional equipment was provided by Steve Lianou.
71 When there was down time on the site because of no materials being supplied, Melkic considered himself as “free to work for others”. However, he did note that the plaintiff did not do any work in such down time. The job was finished and Melkic was never paid because Steve Lianou became “bankrupt”.
72 Melkic also gave evidence that as at the time that the plaintiff fell through the void, they were performing flooring work on the first level.
The Evidence of Dr Oresti Mellios
73 Dr Oresti Mellios was called on behalf of the plaintiff and gave evidence that he was a medical general practitioner and had been practising in the Clayton area for about thirty years. He had been the treating general practitioner of the plaintiff since he was a young teenager.
74 He adopted a medical report he prepared dated 26 August 2010[25] and a letter that he wrote to the neurosurgeon, Mr Myron Rogers on 20 May 2010.[26]
[25]See Exhibit 3 at page 19 PCB
[26]See Exhibit 3 at page 18 PCB
75 Before turning to his evidence, it should be noted that the plaintiff also relies on a report from The Alfred hospital dated 24 July 2012.[27] That report records that the plaintiff was admitted to The Alfred hospital on 26 March 2010, after being transferred from the Frankston Hospital. The history was that he suffered injuries when he fell backwards from a roof.
[27]See Exhibit 3 at page 16 PCB
76 He was diagnosed to have suffered a fracture of the occiput extending to the foramen magnum and into the left carotid sinus, dislocation of the right fifth distal phalanx, which had been reduced at Frankston Hospital, and an L1 superior endplate fracture not requiring surgery.
77 He remained at The Alfred hospital until discharge on 30 March 2010 after commencing physiotherapy and occupational therapy. He was reviewed in the neurosurgery outpatient clinic on 12 May 2010 at which time x‑rays of his cervical spine showed good alignment and x‑ray of his lumbar spine showed no further crushing.
78 At the time of writing his report in August 2010, Dr Mellios noted that the plaintiff complained of upper and lower back pain, decreasing bilateral sciatica and numbness in both buttocks and the posterior aspect of his thighs, neck stiffness with diminished movements of the cervical spine. Furthermore, he had bilateral shoulder pain, tinnitus, nausea, frequent headache and vertigo.
79 Initially the plaintiff was treated with oral narcotic analgesia, but as at August 2010, was managing on 10 milligrams of Endep at night and paracetamol for pain relief when required.
80 In his report, Dr Mellios notes that the plaintiff had suffered the following injuries as a result of his fall:
(a)a fracture to the base of the skull, now healed
(b)soft-tissue injuries to the neck, shoulders, upper and lower back
(c)a closed head injury affecting his middle ears
(d)a minimal compression fracture to the body and superior endplate of his first lumbar vertebra, also now healed
(e)a fracture to the right fifth finger, also now healed.
81 Dr Mellios stated, at the time of writing the report:
“In my opinion the fractures sustained in Mr Apostolidis’ fall are unlikely to provide symptoms further than a few months from now however the soft tissue injuries described above will need physiotherapeutic treatment and further rehabilitation to increase mobilisation, diminish pain levels and engender confidence in his ability to work. The closed head injury resulting in his current tinnitus and vertigo has diminished significantly since the period after the fall but remain at a level where, because of potential unsteadiness and loss of balance it would be unsafe for him to work anywhere except ground level until the symptoms have gone completely.
Currently, due to pain, diminished mobility especially in his neck, shoulders and back; and persisting occasional unsteadiness exacerbated by head movements, he is not fit for any work. It is difficult to say when he would be fit for a return to work as this would entail the symptoms noted above to diminish to a level where safe concentration levels are possible as well as an improvement in his physical capacity, especially balance.
Further treatment should be mainly rehabilitation al, ideally mimicking work situations in the building industry aimed at increasing his mobility and confidence. Mr Apostolidis is a determined man who dislikes the situation he finds himself in and I would expect diligently comply and respond well to further treatment. …”[28]
[28]See Exhibit 3 at page 20 PCB
82 Dr Mellios identified the various certificates of incapacity[29] and in particular the certificate dated 25 July 2012 wherein he states that the plaintiff is suffering neck pain, upper and lower back pain, tinnitus, positional vertigo, post traumatic depression, skull fracture, fracture of cervical spine, soft tissue injuries to his neck and upper spine. At that time he was certifying him for alternative duties but not to work at heights. Dr Mellios considered that the vertigo is the “most troublesome aspect” suffered by the plaintiff.
[29]Refer Exhibit 6
83 Dr Mellios accepted that it was probable that any fracture to the skull had probably healed, the lumbar spinal fracture had healed according to radiology reports and the post traumatic depression was of a mild nature. Dr Mellios confirmed that according to his records, the plaintiff suffered none of these symptoms prior to his fall.
84 The plaintiff continues to see Dr Mellios on a regular basis (at least monthly) for the purposes of providing him with certificates of incapacity. At the moment, he was taking analgesia such as Panadol as and when he requires. Dr Mellios has trialled Stemetil for the vertigo and such medication has not seemed to work.
85 Dr Mellios confirmed that the plaintiff has been treated also by Mr Myron Rogers (neurosurgeon), Dr Brian Anthonisz (the rehabilitation and pain expert) and Associate Professor Peter Kempster (a neurologist). Professor Kempster confirmed that the plaintiff suffers from post traumatic vertigo.
86 When asked about his capacity to return to work in the building industry, Dr Mellios stated:
“A:Sure. Mr Apostolidis’ capacity unfortunately is very variable. My opinion is that with his current symptoms he certainly shouldn’t go work above ground level, and my opinion is also based on my knowledge that he has been a self-employed builder, and it’s also based on my knowledge that he was itching to get back to work, for good reasons at his age, and my opinion is assuming that he is working for himself at a supervisory level at ground level only, and the reason for my opinion – do you wish me to continue, I'm sorry?
Q:Yes, thanks?‑‑‑
A:Yes. The reasons for my opinion that, because of the widely variable nature of his vertigo, he would be unemployable. He – you know, Greg – I could not see Greg applying for work, because he would know that at this point in time he would not be a reliable employee. I think we’re all aware that he currently lectures at Holmesglen TAFE.”[30]
[30]T 155, L30 – T 156, L16
87 When queried about his capacity to perform the work at Holmesglen TAFE, Dr Mellios stated:
“A:I'm very pleased to say that he’s coping very well, but he does have to push himself occasionally. I believe on a couple of occasions he has had to leave because of the frequency of his vertigo if it begins and it persists. I know at other times Greg has told me that when he’s had it occasionally he’s pushed through his lecturing for the benefit of the students. So he’s coping with it at the moment.
Q:If he were offered more work would he increase his hours, in your opinion?‑‑‑
A:I don’t know. You’d have to ask Mr Apostolidis. He may well, but it wouldn’t change the circumstances of his attendance at work.
Q:Yes?‑‑‑
A:It would also mean he would leave work more frequently, which is not an ideal situation.
… .”
HIS HONOUR:
“Q:Just one question, doctor. I think you used the phrase, “he is keen to get back to work”, as you would expect a man of that age. Is motivation an issue at all?‑‑‑
A:Absolutely not, Your Honour. There is top motivation here and I've known him since he was a young man.”[31]
[31]T 157, L22 – T 157, L12
88 Under cross-examination, Dr Mellios was shown one of his certificates dated 15 June 2011, wherein he assessed the plaintiff to have some capacity for work. Such certificate was brought about by the doctor being told that the plaintiff may well be able to get work at the Holmesglen TAFE and that he needed a certificate to be fit for alternative duties.
89 Dr Mellios was asked whether it would surprise him that the plaintiff had applied for the TAFE teaching job as early as January or February 2011. The following evidence was given:
“A:Not necessarily given that he was bursting at the seams to do something.
Q:Would you agree that applying for a job is implied as saying ‘I'm capable of doing it’?‑‑‑
A:Yes, I would.
Q:Would you view of Mr Apostolidis’ capacity change if it were accepted that he had applied for a TAFE teaching job as early as January or February of 2011?‑‑‑
A:Probably, because as I said before it’s my failure to identify an instruction career for him. It never crossed my mind because he’d always been and hands on-builder from a young boy. So I would have to change my opinion, but it would be with those same narrow guidelines I stated before.
Q:Working at ground level?‑‑‑
A:Yes.
Q:Not on tools. So he may well have had a capacity for sedentary employment as early as January or February of 2011?‑‑‑
A:He may well have. Not necessarily sedentary, but certainly employment that wasn’t going to aggravate any of his conditions.”[32]
[32]T 159, L29 – T 160, L17
90 It is convenient also to refer to the medical report of Mr Kudelka, orthopaedic surgeon, who examined the plaintiff on 18 May 2010 at the behest of the agent of the defendant. After obtaining a history, making an examination and reviewing various radiological studies, Mr Kudelka stated, in part:
“This patient has significant injuries resulting from the incident 26.3.2010. He has sustained a fracture of the skull, a soft tissue injury to his neck, a fracture of the 1st lumbar vertebra and an injury to his right little finger. His head, neck and back injuries have not resolved. The right little finger injury appears to have resolved.
…
The patient does not have a current work capacity.”[33]
[33]See Exhibit A page 2 DCB
Relevant Legal Principles
91 Section 82(1) of the Act states:
“If there is caused to a worker an injury arising out of or in the course of any employment, the worker shall be entitled to compensation in accordance with this Act.”
Given the date of injury, the then definition of “worker” contained in s5(1) of the Act was:
“worker means—
(a)a person (including a domestic servant or an outworker) who has entered into or works under a contract of service or apprenticeship or otherwise with an employer whether by way of manual labour, clerical work or otherwise and whether the contract is express or implied, is oral or is in writing;
(b)a person who under this Act is deemed to be working under a contract of service;
(c)a person who under this Act is deemed to be a worker;
(d)…
(e)… .”[34]
[34]See reprint No 15 of the Act; the definition of “worker” by s17(8) of Act No 80 of 2010, which came into operation on 1 July 2011
92 Counsel for the plaintiff submits that the plaintiff was a “worker” employed by Lianou at the time of his injury, either as a result of having entered into a contract of service with Lianou within the meaning of s5(1) of the Act; or alternatively, entered into a contract with Lianou which was deemed to be a “contract of service” within the meaning of s8; or alternatively, being deemed a “worker” and Lianou being deemed an “employer” within the meaning of sections 9, 10 or 10A of the Act.
93 If the plaintiff is a worker employed by Lianou, there is no issue that he suffered injury arising out of or in the course of such employment on 26 March 2010. Furthermore, there is no issue that such injury has resulted in or materially contributed to some degree of incapacity for employment. The duration and extent of incapacity are in dispute.
Section 93 of the Act states:
“If a worker's incapacity for work results from, or is materially contributed to by, an injury which entitles the worker to compensation, the compensation shall be in the form of weekly payments subject to and in accordance with this Part.”
94 The plaintiff’s Claim for Compensation is dated 11 April 2010.[35] Given the date of the Claim for Compensation for weekly payments, s93A(3) and s93B(3) of the Act prescribe the period and amount of any weekly payments for incapacity for the so-called “first entitlement period” (a period of thirteen weeks)[36] and the so-called “second entitlement period” (a period of one hundred and seventeen weeks).[37]
[35]See Exhibit 2 at page 9 PCB
[36]See s91E of the Act
[37]See s91E of the Act
95 It is to be noted that part of the calculation of the amount of the weekly payment turns on whether the worker has “no current work capacity” or has “a current work capacity”. Of course, the words “incapacity for work” contained in s93 requires the worker to have some “incapacity for work” to have an entitlement to weekly payments.
96 In the High Court case of Arnotts Snack Products Pty Ltd v Yacob,[38] the High Court essentially accepted the view that “incapacity for work” means:
“…denotes a physical incapacity for doing work in the labour market in which the employee was working or might reasonably be expected to work … .”[39]
[38](1985) 155 CLR 171
[39]Arnotts Snack Products Pty Ltd v Yacob (op cit) at page 177
97 The phrase “no current work capacity” is defined in s5(1) of the Act to mean:’
“no current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to work, either in the worker's pre‑injury employment or in suitable employment.”
The phrase “current work capacity” is defined in s5(1) of the Act to mean:
“current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to his or her pre-injury employment but is able to return to work in suitable employment.”
Section 5(1) defines “suitable employment” and sets out a number of factors which regard must be had to in determining whether there is any employment in work for which a worker is currently suited.
98 It is to be noted that pursuant to s93A(3) and s93B(3) of the Act, the calculation of the weekly payment of a worker who has a current work capacity turns on the worker’s “current weekly earnings” which are defined in s5B of the Act.
99 In determining whether a contract of service existed between the plaintiff and Lianou (in distinction to a contract for services), early authorities put emphasis on “control” as the determinative factor in deciding whether someone was an employee or an independent contractor. However, later authorities have recognised that control, or at least the right to exercise control, is only one of a number of possibly relevant factors, or indicia, in determining the issue.[40]
[40]See generally Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16; Humberstone v Northern Timber Mills (1949) 79 CLR 389; Hollis v Vabu Pty Ltd (2001) 207 CLR 21; Australian Mutual Provident Society v Chaplin & Anor (1978) 18 ALR 385 and Elazac Pty Ltd v Shirriff [2011] VSCA 405 (unreported, delivered 1 December 2011).
100 I refer to the decision of Elazac Pty Ltd v Shirriff, wherein it is stated:[41]
[41](op cit) at paragraph 30
“… Relevant factors in determining the nature of the relationship between a person who engages another to perform work and the person so engaged include:
(a) the degree of control which the former can exercise over the latter;
(b) whether what is being supplied is the work and skill of a person (contract of service) or the supply of equipment or its performance (contract for services);
(c) whether or not the person engaged can set their own hours of work;
(d) the method of payment (and, in particular, whether payment is determined by hours of service or output or production);
(e) whether or not income tax is deducted and holiday pay or long service leave or superannuation paid;
(f) whether or not the person engaged employs employees and/or conducts his business in partnership;
(g) whether or not there is a power to delegate (send someone else to perform the work); and
(h) whether or not the person engaged considered the relationship as one of independent contractor.”
101 Section 8 of the Act, at the time that the plaintiff was engaged by Lianou, stated:
“(1)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 enters into a contract with any natural person or natural persons (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—
then for the purposes of this Act the contractor shall be deemed to be working under a contract of service with an employer and the principal shall be deemed to be that employer and the amount payable by the principal to the contractor in respect of the performance of work under the first-mentioned contract shall be deemed to be remuneration and shall be deemed to include any payment that would be a superannuation benefit if made in relation to a person in the capacity of an employee.
(2)If an amount referred to in subsection (1) is included in a larger amount paid or payable by a principal under a contract referred to in subsection (1) that part of the larger amount which is not attributable to the performance of work relating to the contract by a contractor under the contract may be prescribed.
(3)If the contractor is a partnership, the contractor is deemed for the purposes of subsection (1)(b) to have performed a part of the work personally if one or more members of the partnership actually performs any part of the work personally.
(4)This section applies to contracts entered into whether before or after the appointed day.”[42]
[42]Section 8 was substituted pursuant to s27 of the Accident Compensation Legislation Amendment Act 2010, which came into operation on 1 July 2011
102 As noted by Ashley JA in Kovacic v Henley Arch Pty Ltd,[43] Section 8 of the Act is the successor to s3(6) of the Workers Compensation Act 1958. I refer to the judgment of Dixon J (as he was then) in Humberstone v Northern Timber Mills,[44] wherein he stated the authoritative of interpretation of such section in the following terms:
“… I think that the purpose of the exception or exclusion expressed by the words in question was to confine the benefit of the conclusive presumption which it establishes to persons who do not conduct an independent trade or business, who are not holding themselves out to the public under their own or a firm or business name as carrying on such a trade or business and who do not in the course of that trade or business, as an incident of its exercise, undertake the work by entering into the contract. The provision will thus cover men who work for the principal but have no independent business or trade and men who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business. The word ‘trade’ is capable of including any handicraft and in that sense it may seem to lack the element of systematic practice or holding out which the idea of openly conducting a distinct or independent trade or business and seeking custom implies. But a consideration of the policy of the provision as well as of its text appears to me to show that the distinction it seeks to draw is between on the one hand an independent contractor whose relation with the principal is special or particular either because it is outside the course of the general business of the contractor or the general practice of his trade or because he has no such general business or is not a general practitioner of his trade, and on the other hand an independent contractor who performs work successively or perhaps concurrently for his customers or others in the course of a definite trade or business carried on systematically or who holds himself out as ready to do so. … .”
[43][2009] VSCA 56 (unreported, delivered on 27 March 2009)
[44](op cit) at 401
103 It is to be noted that a contractor is not excluded from the protection of s8 only because, although working for a single principal, and although not holding himself or herself out as being prepared to contract with others, the contractor retains the right to so hold himself or herself out.[45]
[45]See Melbourne Metropolitan Board of Works v Smith (Full Court of the Supreme Court of Victoria, unreported, 20 March 1991) referred to in Kovacic v Henley Arch Pty Ltd (op cit)
Analysis of the Evidence
104 It is for the plaintiff to establish as a matter of probability that he was a “worker” within the meaning of the Act, employed by Lianou at the time of his injury on 26 March 2010. Furthermore, it is for the plaintiff to prove as a matter of probability the extent and duration of any incapacity which has resulted from or materially contributed from such injury if it be compensable.
105 Counsel for the defendant submits that the plaintiff is neither a “credible” nor a “reliable” witness. The basis of such submission seems largely to turn on the contents of the plaintiff’s taxation returns for the financial years running from 30 June 2008 to 30 June 2011 and the plaintiff’s evidence in relation to such documents.[46]
[46]See Exhibit 5
106 After a consideration of all of the evidence, I have formed the view that the plaintiff is essentially a witness of credit who was attempting to give honest and accurate answers in his evidence. I gained the impression that the plaintiff was but a “cog” in the family business conducted by Pinecore Pty Limited. Other than to say, that the accountant structured the affairs of the family company, the plaintiff could give little evidence as to how and why that structure was in place.
107 It is to be noted that the taxation returns record that Pinecore Pty Limited paid the plaintiff $5,876.00 by way of wages and a bonus of $105,000 for the year ended 30 June 2008; $5,989.00 by way of wages and a bonus of $136,800 for the year ending 30 June 2009; $5,876.00 by way of wages and a bonus of $138,000 for the year ending 30 June 2010; and $5,876.00 by way of wages and a bonus of $179,000 for the year ending 30 June 2011. It must be remembered that these “earnings” occurred over periods that involved the plaintiff working on his Frankston units, and that period immediately following his fall on 26 March 2010. Furthermore, I also note that the plaintiff, although accepting that he did some work for Pinecore Pty Limited, described that most of his labouring work in the building industry was performed for his cousin.
108 In all the circumstances, I tend to the view, that what is declared in the taxation returns are more a function of some accountancy plan rather than a description of actual earnings by the plaintiff over the relevant periods of time. The matter is made somewhat more complicated as the taxation returns also record, amongst other things, claimed deductions for motorcar expenses over the relevant periods.
109 Neither the parents nor an accountant was called to give evidence in relation to this aspect of the matter. I might add that the critical issue in the proceeding is whether or not the plaintiff is a “worker” employed by Lianou at the time of his fall, and, to a lesser extent, the duration of any incapacity.
110 Other than making the general comments above which go more to my view as to the credibility of the plaintiff, I make no express findings in relation to the nature of the payment purportedly made to the plaintiff by Pinecorp Pty Limited as set out in his taxation returns (if ever was actually “paid” to the plaintiff).
111 I should also add that I found the witness, Melkic, to be credible and the evidence of Dr Mellios to be both impressive and compelling.
112 I make the following findings:
(a) In or about November or December 2009, the plaintiff entered into an agreement with Lianou, arranged through Melkic, whereby the plaintiff and Melkic would perform framing work for Lianou at a building site situated in Keith Avenue, Aspendale;
(b) The plaintiff considered that initially he would be paid $65.00 per hour to perform such work, but as from February 2000, understood that a certain lump sum would be paid on completion of the framing work at the site;
(c) At all times the plaintiff considered himself to be a “sub-contractor” rather than employed by Lianou;
(d) The agreement between the plaintiff and Lianou did not extend to any agreement for income tax to be deducted, the payment of any holiday pay, long-service leave or superannuation;
(e) The plaintiff supplied his own carpentry tools, with Lianou making arrangements for fencing of the site and the provisions of toilets and like amenities. Lianou made all arrangements for the delivery of material to the site and the provision of a hoist to move timber around the site for the framing work;
(f) The plaintiff was not required to wear any particular clothing and was free to work his own hours, but considered that he was expected to be there when there was material available to perform the framing work;
(g) Although a representative of Lianou would drop in about once a week to see how the project was developing, neither the plaintiff nor Melkic were under the direct control or supervision of Lianou;
(h) In downtimes when materials were not available at the site, the plaintiff considered that he could, if he so chose, to do other work. However, during the course of his engagement by Lianou, he did not perform any other work (although Melkic did perform other work during these periods of time);
(i) Prior to his commencement of performing work for Lianou, the plaintiff had acquired a Real Estate Agent’s Licence, completed a Bachelor of Business in Property at the RMIT, completed a Diploma of Building, completed a Certificate IV in Construction and had been registered as a Registered Building Practitioner after completing an appropriate course. At no time had he undertaken an apprenticeship in carpentry and was not a qualified carpenter;
(j) Other than obtaining the aforementioned qualifications, the plaintiff had performed work for what has been referred to as the family company, Pinecore Pty Limited, and that such work involved property maintenance and some casual leasing of properties. Furthermore, he had performed labouring work employed by LAS Constructions, which was operated by his cousin, and performed construction work in the building industry;
(k) In or about 2006, the plaintiff set up his own company, Gregory Constructions Pty Ltd, with the intention to “build for myself” and in or about 2008 or 2009, purchased a property in Frankston, whereafter he developed three townhouses on that site. During the construction of such townhouses, he performed some work that required to get sub-contractors and other tradesmen to come onsite to do particular works;
(l) On 26 March 2010, the plaintiff suffered a fall when performing work for Lianou at the building site. Such fall caused a fracture of his skull, a soft-tissue injury to his neck, a fracture of the first lumbar vertebra and an injury to his right little finger. He continues to experience low-back pain, sometimes extending to the right leg, diminished mobility, especially to his neck and shoulders, persisting occasional unsteadiness, exacerbated by head movements (vertigo) and a degree of tinnitus;
(m) The plaintiff performed no work from the date of his injury until August 2011, when he resumed work as a casual and part-time teacher at the Holmesglen TAFE, working about eight hours a week over twenty-five weeks a year. In particular, I find that the plaintiff has no greater capacity for work at this time other than those hours;
(n) The plaintiff has no capacity to return to the type of work he was performing at the time of his injury, or indeed in any work where he has to work above ground level;
(o) The plaintiff applied for the TAFE teaching job in or about January or February 2011 and that he may well have had some capacity for limited types of work as at that date.
Conclusions
113 After a consideration of all of the evidence, I have formed the view that the indicia of the relationship is one which suggests that the relationship between the plaintiff and Lianou was not one of a contract of service, but rather a contract for services. In particular, I take into account the following matters:
(a) Little or no control was exercised by Lianou over the work performed by the plaintiff and with the plaintiff able to work his own hours of work;
(b) The method of payment, which was ultimately based on output or production rather than hours worked and made no provision for income tax, holiday pay, long-service leave or superannuation;
(c) The plaintiff was not required to wear any uniform of the defendant and considered himself an “independent contractor” engaged by Lianou;
(d) The plaintiff supplied his own carpentry tools.
114 Accordingly, I find that the plaintiff was not employed pursuant to a contract of service within the meaning of “worker” contained in paragraph (a) of s5 of the Act.
115 However, after a consideration of all of the evidence, I find that the plaintiff and Lianou are deemed to be working under a contract of service pursuant to s8 of the Act. In this respect, I find that Lianou, in the course of and for the purposes of its business, entered into a contract with the plaintiff whereby the plaintiff agreed to perform framing work at the Keith Avenue site, not being work incidental to a trade or business regularly carried on by him.
116 Returning to the statement of Dixon J in Humberstone v Northern Timber Mills,[47] wherein it is made clear that such a provision will –
“… cover men who work for the principal but have no independent business or trade and men who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business. … .”
[47](op cit)
117 After a consideration of all of the evidence, I find that the plaintiff had no independent trade or business in performing carpentry work, and in particular, framing work. In the past, the plaintiff had worked in the building industry doing general labouring work essentially for his cousin’s organisation and sometimes for the family company. Furthermore, after he had incorporated Gregory Constructions Pty Ltd, such corporate entity was to be used for essentially property development and in fact had only been essentially used on one occasion with the development of the units in Frankston.
118 Accordingly, I find that the plaintiff was employed by Lianou pursuant to s8 of the Act and suffered personal injury arising out of or in the course of that employment on 26 March 2010 when he fell about three metres. I further find that the injuries suffered by the plaintiff have resulted or materially contributed to ongoing incapacity for work, in that he is incapable of performing many aspects of building work and particularly, activities above ground level. Clearly, the plaintiff has demonstrated some capacity for suitable employment on his commencement of his teaching duties in August 2011.
119 On balance, and considering the evidence of the plaintiff that he was looking for work earlier that year, and the evidence of Dr Mellios, I find that the plaintiff was probably capable of performing some work as from March 2011, but certainly no more than what he is demonstrating now.
120 Leaving aside the issue as to whether or not any of the payments made by Pinecorp Pty Limited are “earnings” relevant to the calculation of the weekly payment, the plaintiff has no other current earnings from the date of his fall up until August 2011 when he commenced at the Holmesglen TAFE. In such circumstances, given the operation of the Act, there is no practical difference in the amount of weekly payment until such time that he actually does have “current earnings”.
121 Given the findings that I have made in relation to s8 of the Act, it is not necessary to determine any issues relevant to sections 9, 10 and 10A of the Act.
122 Having made such findings, I call on the parties to determine the appropriate orders that follow from such findings and any other ancillary matters.
ANNEXURE A
1 The plaintiff tendered the following documents:
(a) Exhibit 1 – notebook owned by the plaintiff setting out days and hours worked for Lianou.
(b) Exhibit 2 – plaintiff’s Claim for Compensation dated 11 April 2010 (at page 9 of the Plaintiff’s Court Book (“PCB”)) and Notice of Rejection from Allianz Australia Workers Compensation (Victoria) Ltd dated 26 May 2010 (at page 11 PCB).
(c) Exhibit 3 – medical report from The Alfred Hospital dated 24 July 2012 (at page 16 PCB) and medical reports from Dr O Mellios dated 20 May 2010 and 26 August 2010 (at pages 18 to 20 PCB).
(d) Exhibit 4 – CT scan of the brain, cervical spine and facial bones dated 26 March 2010 (at page 21 PCB); x‑rays dated 26 May 2010, 29 March 2010, 30 March 2010 and 12 May 2010 (at pages 24 – 29 PCB).
(e) Exhibit 5 – taxation returns for the years ending 30 June 2008, 30 June 2009, 30 June 2010 and 30 June 2011 (at pages 30 – 58 PCB).
(f) Exhibit 6 – Certificates of Incapacity (at pages 59 – 84 PCB).
2 The defendant tendered the following documents:
(a) Exhibit A – medical report of orthopaedic surgeon, Mr P Kudelka, dated 21 May 2010 (at page 1 of the Defendant’s Court Book (“DCB”)).
(b) Exhibit B – various employer documents including a list of creditors/purchaser/supplier summary, payables reconciliation, unpaid wages/employee list, payroll unpaid salary and wages (at pages 4 – 114 DCB).
(c) Exhibit C – ASIC name search for Gregory Constructions Pty Ltd and Pinecore Pty Limited (at pages 114 – 115 DCB).
0
9
0