Belcher v Scruton Property Pty Ltd - [2022] FedCFamC2G 180

Federal Circuit and Family Court of Australia
(DIVISION 2)
Belcher v Scruton Property Pty Ltd [2022] FedCFamC2G 180

File number(s): BRG 222 of 2020

Judgment of: JUDGE TONKIN

Date of judgment: 19 April 2022

Catchwords: INDUSTRIAL LAW – Whether employment relationship existed – whether respondent in breach of Fair Trading Act-whether respondent in breach of statutory contract – application dismissed

Legislation:
Corporations Act 2001 (Cth)

Fair Work Act 2009 (Cth)

Federal Circuit Court Rules 2001

Cases cited:
ACT Visiting Medical Officers Association v Australian Industrial Relations Commission [2006] FCAFC 109

Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99

BP (Refinery) Westernport Pty Ltd v Shire of Hastings (1977) 180 CLR 266

Brunette v Integral Energy Australia [2003] NSWIR Comm 324

Byrne & Anor v Australian Airlines Limited (1995) 185 CLR 410

Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337

Collins v Trimatic Contract Services Pty Ltd & Ors (No 5) [2019] FCCA 1018

Commonwealth Bank of Australia v Barker (2014) 253 CLR 169

Hawkins v Clayton (1988) 164 CLR 539

Hollis v Vabu Pty Ltd [2001] HCA 44

Kelly v Commissioner of Taxation [2013] FCAFC 88

Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104

Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451

Division: Division 2 General Federal Law

Number of paragraphs: 176

Date of last submission/s: 25 November 2021

Date of hearing: 19- 21 October 2021

Place: Brisbane

Counsel for the Applicant: Mr Amerena

Solicitor for the Applicant: Workplace Law Group

Counsel for the Respondent: Mr Hogg

Solicitor for the Respondent: McInnes Wilson Lawyers
ORDERS

BRG 222 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:
GUY ANDREW BELCHER

Applicant

AND:
SCRUTON PROPERTY PTY LTD ACN 620 687 292

Respondent

order made by:

JUDGE TONKIN

DATE OF ORDER:

19 April 2022

THE COURT ORDERS THAT:
1.The amended originating application and statement of claim filed on 12 February 2021 be and is hereby dismissed.

Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE TONKIN
Introduction

The applicant Guy Belcher filed an originating application on 16 April 2020 seeking declarations alleging that the respondent Scruton Property Group Pty Ltd (“Scruton Property”) contravened the Fair Work Act 2009 (Cth) (“FWA”) in failing to pay the applicant for work performed between June 2017 and 29 June 2018 and additional entitlements. He sought to recover all accrued salary and bonuses in accordance with section 323 (1) of the FWA $80,769 plus interest, his leave entitlements of $5769.23 plus interest, payment in lieu of notice of $2884.61 plus interest and superannuation contributions of $7673.
The respondent Scruton Property filed its response on 20 May 2020 seeking the application be dismissed pursuant to rule 4.03 (1) (c) of the Federal Circuit Court Rules 2001 as to the whole of the relief claimed by the applicant on the basis that the application was without reasonable cause. The respondent asserted that the applicant was not an employee and had never been an employee of the respondent.
On 29 January 2021 Judge Jarrett granted the applicant leave to file an amended application and statement of claim. An amended originating application and statement of claim was filed on 12 February 2021. The applicant sought relief with respect to actions in quantum meruit and breach of statutory duty and in the alternative relief under the FWA for contraventions as pleaded in his originating application filed on 16 April 2020.
On 26 February 2021 the respondent filed a Defence and further amended Defence 21 October 2021 seeking the application be dismissed.
The matter proceeded to trial for 3 days on 19, 20 and 21 October 2021. Directions were made for the filing of written submissions the last of those received on 25 November 2021 and judgment reserved.
In written submissions the applicant sought relief under the FWA, or in the alternative, relief for breach of statutory contract. The quantum meruit claim was not pressed.[1] The respondent sought the application be dismissed.
[1] Applicant’s written submissions filed 18 November 2021 at [31]
Facts not Disputed
The applicant Guy Belcher:
(a)was at all material times a director of BeautyFULL CMC Pty Ltd (trading as BeautyFULL Cosmetic Medical Clinic) (“BeautyFULL”) from 5 January 2012 to 17 July 2018;
(b)was at all material times a director and secretary of Cosmetic Skin Therapies Pty Ltd (“CST”) from 21 March 2016 to 17 July 2018; and
(c)is and was at all material times an individual able to sue and be sued.
The respondent Scruton Property Group Pty Ltd (ACN 620 686 292) (“Scruton Property”) is and was at all material times:
(a)A corporation registered under the Corporations Act 2001 (Cth);
(b)Registered on 26 July 2017;
(c)able to sue and be sued;
(d)a company whose secretary was appointed as Mark Scruton Sowden (“Mark”);
(e)a company whose directorship includes:
(i)Margaret Scruton (“Margaret”);
(ii)Mark Scruton Sowden;
(f)a company whose previous directorships included:
(i)Kate Scruton Belcher (“Kate”) between 26 July 2017 and 17 September 2018; and
(ii)Guy Belcher (“the applicant”) between 26 July 2017 and 28 June 2018;
(g)a company since 29 November 2017 that was the registered owner of 1024 Logan Road Holland Park West more specifically described as Lot 9 on Registered Plan 811608 in the Local Government area of Brisbane City (“1024 Logan Road”); and
(h)a company since 1 February 2018 that was the registered owner of 29 Lamette Street Holland Park more specifically described as Lot 10 on Registered Plan 44087 in the Local Government area of Brisbane City (“29 Lamette Street”)
Margaret and Kate were directors and shareholders of BeautyFULL CMC Pty Ltd (trading as BeautyFULL Cosmetic Medical Clinic) (“BeautyFULL”) during the period July 2017 to 18 June 2018.
Margaret is the mother of Kate and Mark.
Guy Belcher married Kate on 26 February 2011 and the parties separated on or about 18 June 2018.
Issues
The following issues require determination:
(a)Did the applicant perform work for the respondent and if so what work was performed for the respondent over what period;
(b)When performing work during the relevant period was the applicant an employee of the respondent;
(c)If so, did the respondent contravene the Fair Work Act 2009 (Cth) as asserted by the applicant;
(d)If not an employee of the respondent was the respondent in breach of a statutory duty under the company’s constitution;
(e)If so was the applicant entitled to remuneration under the respondent’s constitution for the performance of “other work” undertaken by the applicant; and
(f)If so, how should remuneration for “other work” undertaken by the applicant be assessed.
Evidence
The applicant Guy Belcher relied on his affidavits filed on 11 January 2020 (some 580 paragraphs), on 16 April 2020 and on 21 August 2020. He was cross examined at length. He confirmed he held a Bachelor of Business (Accounting with Banking & Finance) degree and in 2012 became a Certified Practising Accountant. In 2010 he was employed as an accountant for WorkCover Queensland and through his employment he was involved in commercial lease matters and worked closely with the property team at WorkCover Queensland.
He gave evidence that he had experience in building and renovations and completed three residential constructions in 2009 and 2010 when he was the owner builder of 142 Queensport Road, Murarrie in Queensland. He was assisted by his father. In 2015 the builder contracted to construct the home for the applicant and his then wife Kate at 76 Stanmere Street, Carindale in Queensland went into liquidation and he completed most of the works on that property including demolition, subdivision and general building works. He engaged trades as needed and organised and discussed jobs with those tradesmen. In mid - 2017 he took annual leave and long service leave from WorkCover.
Purchase of commercial premises
From 2010 the applicant was managing director of BeautyFULL Cosmetic Medical Clinic (“BeautyFULL”) a cosmetic injectables business run by his wife Kate a nurse and her mother Margaret a medical practitioner who were also directors. In early 2017 it is common ground that the lease for premises from which BeautyFULL operated was ending and those premises were no longer meeting the business’s requirements.
The applicant said in June 2017 he had a conversation with Margaret, Kate and Mark regarding the need to find alternative premises from which BeautyFULL could operate in circumstances where the lease for the premises was due to end. The applicant said he had attempted to negotiate with the original landlord about obtaining additional space for BeautyFULL but those negotiations were unsuccessful. According to the applicant Margaret indicated that “she was happy to purchase a new commercial premise for BeautyFULL to run its business from.” The new premises would be owned by her (or an entity owned by her) and BeautyFULL would lease the newly purchased premises back from Margaret (or an entity owned by her) at market value.
It is not disputed by Margaret that the lease for BeautyFULL was coming to an end, it had not been renewed and they needed a place from which BeautyFULL could operate and that following discussion between the directors she agreed to provide finance to purchase a commercial property from which BeautyFULL could operate.
The applicant contends that during the course of the parties’ conversation about purchasing commercial premises Margaret “requested that he locate a suitable commercial property for BeautyFULL to occupy as lessee.” He undertook a search for suitable premises that included inspections at multiple different sites, internet searches, and liaising with realtors. Kate also assisted in the search for commercial premises as did Margaret. All three persons inspected a number of commercial premises to determine the suitability of premises from which to operate a cosmetic injectables business.
The applicant said in mid - July 2017 he telephoned Matthew Hackett of Place Real Estate in Bulimba to organise an inspection once of 1024 Logan Road, Holland Park West Queensland. A few days later he, Margaret and Kate attended and inspected the Logan Road property. On around 20 July 2017 he organised a meeting with owner of 1024 Logan Road, Paul Bennion and he, Mark and Kate attended the meeting. They discussed with the owner their proposed development of the property. Chris Lindeman the carpenter subsequently engaged to complete work on 1024 Logan Road and a witness for the applicant when cross examined said regarding the purchase of 1024 Logan Road “there was another house on the corner next door as well that they acquired and renovated also under the Scruton Group….. 29 Lamette Street.” He said “I actually went with (the applicant) to have a look at the property prior to taking over the property to see if it had any major structural damage or anything like that that could incur big costs prior to that, so Guy and myself did that … he would liaise between the other directors and himself and then inform me what to move forward with.” Ultimately it was determined that 1024 Logan Road would be purchased as premises from which to operate BeautyFULL. Margaret disputed that the applicant was requested to locate suitable commercial premises. She said he took it upon himself to do so.
The applicant said on or about 24 July 2017 he took initial steps for the company Scruton Property Group Pty Ltd (ACN 620 686 292) (“Scruton Property”) to become incorporated through “onlinecompany.com.au” for the purpose of purchasing commercial property. He sought Mark’s approval and confirmation by email before the company was formally created and on 26 July 2017 Scruton Property was registered under the Corporations Act 2001 (Cth). He was appointed a director of Scruton Property as was Kate, Margaret and Mark. Margaret and Mark remain directors of the company.
Mark claimed that the applicant exaggerated that he had “completed the company formation” as that task was “a rudimentary process and should have taken no more than 30 minutes as the company was registered via deed.com.dot.au. pty ltd.” He said Battalion Legal created most of the documents including the Company Constitution and Margaret was required to complete and sign the relevant documents.
Margaret said Scruton Property was incorporated as a holding company for 1024 Logan Road and not as a property development company. She engaged the services of two companies to help her incorporate Scruton Property Pty Ltd. She said “deed.com.au” was an online company that produces legal documents and she also engaged Battalion Legal. Regarding the applicant’s involvement she said he would have searched those services because the company had not yet started and he had experience in that regard as he had already established companies for BeautyFULL. She agreed that he assisted in the task but said it would have taken him 15 minutes.
Margaret was asked during cross examination why she stated in her affidavit that “she engaged the online service.” She said as “she was the only person who could sign documents” she believed she engaged those services.
I am satisfied that the applicant Margaret and Kate initially discussed the fact that the lease for BeautyFULL was due to end and the applicant had investigated with the landlord the possibility for expanding the area from which BeautyFULL operated albeit unsuccessfully. The directors and shareholders of BeautyFULL agreed that they would locate commercial premises from which BeautyFULL could continue to operate its business and Margaret agreed to fund the purchase of those premises. BeautyFULL was a family business operated by the directors and shareholders for which the applicant had been the managing director from 2010. The applicant had an interest as both shareholder and director of BeautyFULL to ensure the company continued to operate.
On 29 November 2017 Scruton Property purchased 1024 Logan Road Holland Park West Queensland and remains the registered owner of the property. Margaret is the sole shareholder of Scruton Property. The purchase of the premises was funded by an entity controlled by Margaret. On 1 February 2018 Scruton Property purchased the adjoining property at 29 Lamette Street Holland Park and remains the registered owner of that property.
Work performed for Scruton Property
The applicant said the development of 1024 Logan Road was a family enterprise overseen by Margaret. In his affidavit he deposed that he was answerable to Margaret and would undertake tasks at her direction. He deposed that he was directed by Kate or Mark to undertake tasks and whenever this occurred he considered any services or work performed as a consequence was done on behalf of Scruton Property. Kate, Margaret and Mark denied that they directed the applicant to perform any specific tasks.
The applicant was cross examined at length regarding whether there were any meetings between the applicant and Margaret, Kate and Mark about the necessary improvements required to ensure 1024 Logan Road was a suitable premise from which to operate a cosmetic injectables business. Counsel for the respondent suggested that there was never a meeting between the applicant, Mark, Kate and Margaret or any of them discussing for example “from here on Mark is going to do this. Kate is going to do that. Guy is going to do that.” He disagreed and said there was a meeting between Kate and Mark and between Kate and Margaret and the applicant and Chris Lindeman. He said Mark wasn’t at the meeting but the meeting was held to talk about what the applicant would do for the property to get it developed. He said the meeting took place at 76 Stanmere Street “at our house.”[2] When pressed on this issue the applicant said he could not recall whether he mentioned that particular meeting in his affidavit but said there were multiple meetings with Margaret and Kate and they went to other sites prior to purchasing 1024 Logan Road “to discuss it.” He agreed they had looked at a number of other sites to purchase property for about 6 months from June 2017 in circumstances where BeautyFULL’s lease was ending.[3]
[2] Transcript 19 October 2021 p.17 ln 25 - 30
[3] Transcript 19 October 2021 p.19
The applicant said they discussed a budget for the work that needed to be done on 1024 Logan Road to construct treatment rooms for the business. He said “I was given dollars and we had a task to renovate the property and that evolved throughout the time. So the dynamics kept changing of what further things would come apparent, ripping down walls, asbestos would come into play. Roof would need repointing, etcetera, so it just evolved over the six months.” He agreed that the directors did not give him a list of tasks but said “I would speak to them through the week and tell them what would require to be done as they would come up or if anything would change.” Counsel suggested “it wasn’t a request from those other directors. It was more you saying, ‘These things need to be done and I’m going to go and get them done’” He said “Well, yes, I would tell them that this needed to be done and they would say, ‘Just get it done for…’” He agreed he could decide what work needed to be done and when the work would be done.[4] He agreed that was dictated by how the project developed. I find the applicant’s evidence wholly inconsistent. At one point he denied he decided the way tasks needed to be done and at other times accepted that he would tell the other directors what needed to be done.
[4] Transcript 19 October 2021 p.20
He said the budget discussed was $200,000 originally and “they drew a mud map so there was a specific plan and that evolved as the job progressed.” He was directed to complete the job for a specific budget and once the budget was exceeded, he would request further approval from Margaret for funds she controlled. Margaret disputed this and said the applicant simply assumed responsibility for the installation of the fit out and “took control.” He said if there was a major task for example reroofing or repointing of the roof he would contact Margaret and seek her approval as she was the one funding the project. He said Margaret would make the decision whether to spend $20,000 or $30,000 and if she wanted the work done he would organise that.
The applicant gave evidence that he undertook the following work: organising tradesmen, discussing the work with next-door neighbours and professionals (such as real estate agents and lawyers). He had full access to Scruton Property’s bank accounts and company portals and made payments and completed the accounting bookwork for the project. In support of that assertion he produced a number of invoices and quotations directed to Guy Belcher on behalf of Scruton Property. He said Margaret, Kate and Mark trusted him to complete the development of Logan Road in a timely manner and to ensure that money was being well spent and within budget. They were aware that he had been involved with building projects in the past. He often had conversations with Margaret, Kate and Mark (whether individually or collectively) about money for the development, the budget, the plans and the timeframes for the development (amongst other things). He said “discussion took place in a free flowing manner as the development progressed and as the needs of the development required.”

In his affidavit he particularised meetings attended by himself, Margaret, Kate and sometimes Mark and the time frame for those meetings. Margaret and Kate did not dispute that meetings occurred to discuss various aspects of the property development however both Margaret and Mark said that at no time was the applicant directed to perform any task. Any meeting between the directors was designed to update the directors on the progress of the development project. Both Margaret and Mark claimed that the applicant exaggerated the time taken to discuss various matters and disagreed with his estimates of time meetings took place. I found the applicant’s guestimates of time for meetings unsatisfactory. The meetings were not recorded or diarised. Margaret and Mark indicated they occurred on an ad hoc basis basically with the applicant advising them how the development was progressing. I prefer their evidence to that of the applicant.
The applicant detailed at length in his affidavit filed 11 January 2020 at items 1 to 158 the work he said he performed for or on behalf of Scruton Property. He said that following the purchase of 1024 Logan Road in December 2017 he worked on the development equivalent to a full-time basis and undertook work or otherwise provided services to Scruton Property for a minimum of 40 to 50 hours per week. The time he worked and the particulars of the work performed by him were based primarily on his recollection and contemporaneous documents such as emails and invoices as no time sheets were recorded and no records were kept by him.
He claimed he was responsible for the “project’s oversight” which included communication with tradesman and suppliers, administration to ensure tradesman and suppliers could efficiently undertake their tasks, an overview of the quality of the work performed by the contractors and subcontractors, ensuring any work complied with Scruton Property’s expectations, directing for the rectification of defective or incomplete work, assessing whether money should be paid to certain contractors and subcontractors and enforcing timelines. He said this comprised about 40% of his time with another 40% of his time being devoted to general labouring (physical building site work, landscaping, cleaning the site and the like). He said the work was undertaken by him over the period December 2017 to June 2018 and when undertaking project oversight work he would direct tradesman, suppliers and other relevant persons to undertake tasks in a particular order, or in a particular way or by a particular date. If not satisfied regarding the standard of work performed he would direct tradesman to rectify the work. Though he performed those tasks, all tradesmen worked independently of him and he did not interfere in either supervising the tradesmen or directing them while they were working. His role in Project Oversight was to ensure the work performed was to a high standard as required by Scruton Property.
At times he performed labour on site that generally involved doing the “heavy lifting” or acting as a “second set of hands” assisting workers on site, similar to the role of a builder’s labourer. He did not decide how the building was to be erected nor intervene in any designs or plans while on site labouring during the building’s construction. He was asked about his claim that he picked up rubbish and undertook general building site duties. He denied this was the carpenter’s job. He said he did that work as he didn’t want Chris Lindeman charging Scruton Property for work he could have done. As discussed below Chris Lindeman did in fact render an invoice for cleaning up the site.
Counsel for the Respondent suggested that the 40 to 50 hours a week work that the applicant said he performed “was of his own volition” and that he “decided what needed to be done and then you went and did it; is that correct? That was the general way it worked.” He disagreed and said “I was given a budget… and we had a task to renovate the property and that evolved throughout the time. So the dynamics kept changing of what further things would come apparent, ripping down walls, asbestos would come into play. Roof would need repointing, etcetera, etcetera, so it just evolved over the – over the six months.”
Counsel for the respondent challenged the applicant’s ability to work in the building and construction industry. The applicant conceded that he had no formal qualifications but had acquired practical knowledge and experience. He said he had experience in renovating properties beforehand and had a fair idea of what needed to be done to get the work done. Counsel suggested that he “really took it upon himself to do and organise a lot of the renovations.” He agreed and accepted that he wasn’t given a list of tasks to complete by the other directors but “would speak to them through the week and tell them what would require to be done as they would come up or if anything would change.” He would tell them what needed to be done and they would say “yes just get it done.” He agreed he decided what work needed to be done and how and when that work would be done. He said “the original plan was we had $200,000 and we needed to create treatment rooms. We drew a mud map so there was a specific plan originally and that evolved as the job progressed. If it was a major task like a reroofing or repointing on the roof he would have to go to Margaret because Margaret was the ultimate one who was funding the project. Some things cost $20,000 to $30,000 and he did not make that decision with her money so he would ask her to make the decision and if she wanted it done then he would go and do it.” He would ask Margaret “to do this or that” and she would say yes or no so he wasn’t making the ultimate decision. He would ask her permission to do something extra that might be outside the budget. He did not spend her money willy-nilly. He agreed that Margaret funded the project. He said he did not ask her for permission to purchase small items (for example screws) and did not keep logbooks of his time and the actual work he performed. He agreed he did not report to Margaret and Kate on a daily basis but said they had meetings most weeks.
Regarding whether the applicant was working full time on the project he agreed in cross examination that he was not on site at 1024 Logan Road “the whole time.” He said only when he was required to be there or something needed to be done. His office was predominantly at home that’s where he “did the books.”
He agreed with Counsel that the interior of 1024 Logan Road when Scruton Property bought it was not suitable for an injectables clinic and the premises needed to look clean and fairly modern and reasonably inviting to put customers at ease. He said there were certain requirements to be met for the Department of Health. He agreed the house at 1024 Logan Road was dilapidated but denied that “everything needed to be ripped out.” There were hardwood floors that needed polishing and re-sanding but the kitchen had to be completely gutted and new cupboards installed. He said the bathroom needed renovating and the whole house needed re - plumbing. The big bedroom needed to be split and a new wall installed to create a treatment room.
Regarding the budget he said there was scope for the external façade for rendering and painting. He could not recall whether the roof was discussed but an issue arose with the roof. The budget allocated related mainly to the walls, the fit-out and the new rooms. He said Aussie Excavators were engaged to improve the driveway and car park.
The applicant was asked about Chris Lindeman’s role. He agreed that Chris was a friend of his and when engaged to work on 1024 Logan Road Chris was living with the applicant, Kate and their children in the family home. He denied Chris was appointed as site foreman at the job. He said he was the project manager and Chris was onsite with him. He accepted that he had referred to Chris as the site foreman in an email to people if they needed someone to contact if the applicant was not available. He accepted he sent an email to the next-door- neighbour David Rankin advising “I won’t be onsite tomorrow, but Chris Lindeman (onsite foreman) will be there from 7.30 am.” He disagreed that Chris was the main tradesperson directing the other trades. He said he was the main person directing other trades and Chris would be a contact if he wasn’t there. He denied Chris was the head tradesperson onsite but rather said he was the carpenter. He disagreed that the carpenter is the one that normally “calls the shots” on a building site.
He denied that the role of project oversight was Chris Lindeman’s job. He said he and Chris had a meeting and as it was a very big job they agreed that the applicant would be the project manager. Chris helped him when required. He was asked about a statement in his affidavit where he said “at times when I performed project oversight, I would direct tradesmen …..I would not interfere in any capacity in supervising or directing tradesmen.” Counsel suggested “So you would tell tradesmen to come to the site, and then you would basically leave them to it?” He said “Yes. Show them what needed to be done, etcetera, and leave them to do their work, and make sure they’re doing their work.” He said he did not perform any tasks that required him to have the skill, license or experience of a tradesmen he was just a second set of hands onsite. Chris had a labourer for a couple of weeks helping him do a couple of things.
The applicant said he and Chris prepared a Gantt chart and they “would sit down and we would try and work out – map it out with Kate and Margaret, and whoever, and we would sit down at night-time at the home. We would try and work out the trades for the next week or next two weeks, and would sit down and try and work that out. He would – he had friends in the building industry, and I had also people that I had used in previous builds, so we would contact them or contact – get quotes, whatever. He would sort of map it out because he was a carpenter. He had done a lot more builds than me.” He agreed that a Gantt chart is an important project management tool for programming. He said they both sat down together to work out the plan for various trades. It was suggested that he had never mentioned the existence of a Gantt chart in any of his affidavits. He said he was unsure whether he had mentioned it in his affidavits. Regarding the request to locate the document he said “Well, it wasn’t exactly like an Excel gantt chart. We would sit down and map it out. When I say gantt chart, it’s a loose term for a progress of budget, or a timeline of what we had to do.” During the hearing he was able to locate the Gantt chart that he and Chris had compiled it together. The document located was incomplete.
It is common ground that during the period 14 December 2017 to 18 June 2018 the applicant performed accounting work for Scruton Property and was not paid for the work undertaken in that regard. He estimated that he performed accounting work for Scruton Property in developing the commercial premises at 1024 Logan Road for about 20% of the time including keeping payments and receipts for the rental property. It was suggested that Scruton Property engaged the services of Belle Property to be its rental agent. He agreed that they were the rental agents and handled the rent receipts for the property. He said they deposited money into the bank account and he would reconcile it. He said he did a couple of BAS statements and that work probably took him half an hour in addition to paying invoices. He agreed that Margaret engaged Nexia accountants to review his work as there was a lot of capital expenditure. I am satisfied that the accounting work performed for Scruton Property by the applicant was minimal and overseen by a firm of accountants engaged by Margaret.
The applicant was asked questions about Kate’s affidavit filed 15 October 2021 where she said she was involved in considering and making decisions in relation to the fit - out including selecting interior paint colours, tiles, cabinetry, tapware, stone benchtops, etcetera. He agreed. She also said she was involved in making decisions in relation to the interior layout of the BeautyFULL Clinic, including mapping and marking out the additional rooms and what walls should be knocked down or put up. He agreed that Kate and Chris and he at one time sat down trying to mud map the development. Regarding his claim that he worked on site full time between January and June 2018, he agreed that he spent 10 to 12 days over the Christmas period on the Gold Coast. He said he still performed work for Scruton property answering inquiries and following up quotes.
He was asked about criminal charges he faced in November 2017 which concluded in January 2019. Counsel suggested that he was preoccupied with that matter and that he spent a lot of time dealing with solicitors and going over statements. He denied that. He said he employed solicitors and they took instructions and negotiated with police. He said the matter was in the back of his mind until its conclusion and ultimately he did not go to trial. I reject the applicant’s evidence on this issue. I am satisfied that the applicant was likely to be pre-occupied regarding the serious criminal allegations brought against him. Margaret gave evidence that he had effectively been “stood down” from work when he took long service leave. In my view the applicant attempted to minimise the impact upon him of the pending criminal charge. I suspect Margaret was correct when she said she was pleased he was distracted by the Logan Road development given the serious charge he was facing.
The applicant was cross examined regarding the length of time he spent playing golf. He said he played each Wednesday for three hours a day. Counsel suggested that he spent much greater time playing golf. He disagreed. Kate suggested he played golf three of four times a week. He disputed that. He accepted that he may have played golf once or twice a week usually on Wednesday which took him about three and a half hours. During re-examination he produced a schedule of the time he spent playing golf at various golf courses (Exhibit A2).
Chris Lindeman
Chris Lindeman gave evidence that he was a carpenter by trade running his own business since 2008. He had lived with the applicant, Kate and their children in their home from August 2016 to March 2018. He worked with the applicant for 7 months between December 2017 and June 2018 on the 1024 Logan Road property development. His understanding was that the applicant was a director and employee of Scruton Property and headed up the renovation on behalf of Scruton Property. He said the applicant was the main point of contact for all trades and also acted as helping hand around the site. He observed that the applicant was onsite for 5 or 6 days a week at various stages throughout the day. He would spend from 6 to 10 hours a day or 40 to 50 hours a week assisting with the development. He was the onsite project manager. The tasks he performed included organising trades such as carpentry, excavators, shutters, plumbing, electrical, rendering, painting, air-conditioning, plastering, tiling, concreting, glass, insulation, telephones, security, managing payments to trades upon completion of work, helping trades where possible whether that be picking up items and on the tools, cleaning up the premises, liaising with neighbouring properties regards trees and purchases, organising labour and installing a security system.
Chris Lindeman was cross examined by Counsel for the respondent. He said he finished doing the internal work on 1024 Logan Road sometime after April 2018 but continued to work for Scruton Property after that until about August 2018. He agreed that in April 2018 the work for BeautyFULL was finished and the business commenced operating. He said BeautyFULL moved in around April 2018 but some further work was completed after that. He was asked whether that was for a garage where the hairdresser was going to be operating from. He said there were multiple parts. CST moved in as another tenant and he was instructed to renovate part of 1024 Logan Road for CST and then instructed to renovate the garage. He said the family wanted to change the garage into a useable space as well, and he was instructed to do that also.
He said the project was an evolving one and the costs evolved and changed to suit the client’s needs. The work was primarily on 1024 Logan Road however there was another house on the corner next door that was acquired and renovated by Scruton Property which was 29 Lamette Street Holland Park.
Regarding whether the project was cost efficient he said he didn’t make any financial decisions he was “purely there as a carpenter.” He provided cost estimates in different ways and suggested different ways of doing things and Scruton Property made the financial decision. He accompanied the applicant to inspect 1024 Logan Road prior to the property being purchased to determine if there was any major structural damage or anything that could incur big costs. He observed that the applicant would liaise with the other directors and then inform him how he should move forward. He disagreed that he was the person making the decision about the most cost effective way to perform the work. He said he would give the applicant, Margaret and Kate all different options and point out which could be the best but it was always a decision made by the directors at the time. He denied that he was the site foreman and was overseeing other trades on site. He said he was there as a point of contact, but every trade was approved by a director prior to commencing any work. Counsel for the respondent suggested that he was the one telling each tradesmen what to do. He denied that and said the applicant was there for the majority of the time and then later Mark was there for the majority of the time when the directorship changed. He was engaged as the “technical mind” to explain some things and help the directors make informed decisions. I reject Chris Lindeman’s evidence that he was not the site foreman overseeing other trades on site. He was described by the applicant as the site foreman and paid for performing that work by Scruton Property.
At the time he worked for Scruton Property Chris Lindeman said he was involved in a couple of other jobs but they were outside normal work hours. He was asked whether he was responsible for cleaning up the premises at 1024 Logan Road. He denied that and said he did some of it. He said most trades clean up after themselves but he did tended to do a bit of the cleaning because he was there more consistently than some other trades. He said the applicant “did a hell of a lot of the clean up as well.” He agreed that he did not invoice Scruton Property for any work he did not do.
He was shown Mark Scruton Sowden’s affidavit filed on 19 May 2020 and asked whether he charged Scruton Property $10,000 to “demolish and remove rubbish.” He agreed he did. He said the work would have been inclusive of a skip. He agreed he was paid by Scruton Property for that work. He agreed that he organised trades for new construction and was paid for that work again a substantial sum of money. When questioned about this he said “organising (trades) and liaising was actually a minimal part of the job.” He claimed that the applicant did the majority of talking with tradesmen as there were ongoing negotiations and discussions that took place with the directors outside work hours. He said as multiple directors needed to be there it was quite often 7 o clock at night when meetings took place due to the time constraints of the directors. I formed the view that Chris Lindeman’s evidence was tailored to assist the applicant’s case. The estimate of time Chris Lindeman indicated the applicant worked was not supported by any documentary evidence nor consistent with the evidence given by the respondent’s witnesses.

He was asked about an invoice for 7 January 2017 (an error which should read 2018). He agreed he charged Scruton Property $5000 for demolishing and removing rubbish and pouring a concrete slab, for extra framing throughout the building and for organising trades for the new construction. He agreed he was asked by Mark to justify the work he did regarding the invoices he was paid and agreed he produced a document where he had jotted down the work he performed and what was done at different points of time. The work he performed was not diarised but simply reflected in invoices rendered which contained broad general statements of work completed.
Regarding the work he said the applicant performed he agreed that the applicant did not work “alongside him” but said he was there on site at 1024 Logan Road six days a week for the majority of the project. He was always contactable by phone 24 hours, seven days a week if something arose and was on call all the time. He said the applicant was stationed in a temporary office “in the middle of the place” to keep everything streamlined. He knew where he was pretty much the whole time because they were working closely together. Kate gave evidence that the applicant spent a lot of time working from home.
According to Chris Lindeman the work for BeautyFULL was complete by April 2018 and the business commenced trading around that time. Chris Lindeman continued to work and be paid Scruton Property regarding aspects of the project relating to exploring whether a hairdressing salon should be incorporated into the building. That was not a proposal that came from the applicant. His evidence was vague and generalised with a focus on assisting the applicant. I place little weight on his evidene.
Margaret Scruton
Margaret Scruton relied on her affidavits filed on 8 September 2020 and 15 October 2021. She agreed that she held a financial interest in both BeautyFULL and CST and was a director of BeautyFULL. She was a director and sole shareholder of Scruton Property and sole shareholder of Scruton Pty Ltd in her capacity ATF the Scruton Bloodline Trust Will. Scruton Property Pty Ltd provided the funds for the purchase of the commercial premises and had provided the funds for the improvements to 1024 Logan Road.
Margaret gave evidence that the work done on 1024 Logan Road was for the benefit of the two companies to change the configuration of the existing house to allow BeautyFULL and CST to operate from there. She denied that she requested the applicant to locate commercial premises from which BeautyFULL could operate and denied that she had any control over the work performed by the applicant nor that she directed him to perform any tasks. She said he had no role, nor was there any employment agreement or arrangement between the applicant and Scruton Property to perform work renovating 1024 Logan Road and she did not expect him to do anything for the company.
She said at the time the renovations took place she was very busy working as a general practitioner. Chris Lindeman was engaged as the site foreman for the fit out and was paid for the work performed on the fit out by Scruton Property. She said the applicant would occasionally seek her input on some aspects of the project but he was never directed to perform work.
When cross examined she agreed that the applicant took long service leave from August 2017 until the first half of 2018. She said WorkCover asked him to take a sabbatical for six months on half pay. She initially denied that she knew he was going to take time off work and said she only found out after it had occurred. She was questioned about the Statement of Claim and the Defence filed in the proceedings and denied that she had seen those documents. It was suggested to her that in the Defence filed on behalf of Scruton Property it was admitted that she knew the applicant was going to take leave before he took leave. Counsel for the applicant suggested that she took advantage of the applicant while he was on leave to work on her property development. She denied that and said he shouldn’t have been doing the work as she never asked him to do any work and he was not qualified to do the work. She said “I’m not saying he didn’t do any work I’m just saying I wouldn’t have employed him to do it.” She said some of the work that he did had to be changed afterwards, after he left.
She agreed that between December 2017 and June 2018 the applicant would approach her and ask her questions about the development and she knew that he was involved in the development to a degree. She said “I thought it was good for him because he had other things on his mind at that stage.” She was happy for him to take his mind off his other court case. She agreed that at no time did she stop him from working on the development. She commented that if she had done so it would have caused problems between him and her daughter. She said the work went over budget.
She was asked questions about meetings that were held to discuss the property development project. She recalled a meeting at 1024 Logan Road that went for 30 minutes and another meeting with the applicant which she said lasted 45 minutes. She had a discussion with Kate regarding the purchase of the chandelier but did not recall attending the shop to purchase it. She recalled attending other meetings with the applicant which she said lasted an hour and attending a meeting with a cabinet maker to discuss cabinetry for the BeautyFULL fit out in January 2018 that went for between 1 to 1 ½ hours. She recalled a meeting in late January 2018 and said at the time the tiles had already been chosen and the meeting was brief about half an hour. She recalled another meeting which lasted 15 minutes. Though she did not dispute she attended meetings with the applicant to discuss the development of 1024 Logan Road she disputed the estimates of time taken as asserted by him. She gave evidence that he had exaggerated the time with respect to the length of the meetings.
She agreed the work undertaken on 1024 Logan Road was paid for by Scruton Property the registered owner of the land. Regarding the funds made available to Scruton Property she agreed that she was the sole shareholder of Scruton Pty Ltd in her capacity as trustee and that Scruton Pty Ltd was a company that held shares. She agreed that she could remove or add directors and had some oversight and control of the company. She agreed that Scruton Pty Ltd funded both purchases of 1024 Logan Road and 29 Lamette Street and it funded the construction and improvements on 1024 Logan Road. She accepted that the money that funded those works was her money and that she had control over the money distributed from Scruton Pty Ltd to Scruton Property and that as a shareholder she had an interest in the development being successful. She said the reason the company paid was because BeautyFULL and CST did not have the money to fit out the premises.
She agreed that Scruton Property was the party liable to pay contractors and subcontractors undertaking the renovation work. Regarding the invoices annexed to the applicant’s affidavit filed on 11 January 2021 she agreed they related to the property development on Logan Road and accepted that the invoices and quotations from contractors and subcontractors addressed to Scruton Property had the applicant’s name, email and mobile number on them. Counsel for the applicant suggested that was because he was organising the renovation for Scruton Property. She denied that and said that he was not organising it but rather Christopher Lindeman, the applicant’s best friend was doing the organising for the fit-out for BeautyFULL, and “the applicant was getting all these things because of Christopher, and we were having to pay for them.” She volunteered “I never asked him to perform any duties for Scruton Property.” She suggested that the email address [redacted], was also her daughter’s email address.
She denied that she was the only one “calling the shots” making decisions about money. She said “no we have always discussed it.” Once the applicant resigned in about June 2018 Mark did most of the work for BeautyFULL. She agreed that the applicant was not paid a wage as an employee of BeautyFULL but observed that he held a one third interest as shareholder of that company.
She said Chris Lindeman organised the subcontractors, electricians and plumbers as they were all his friends. She was asked if that was so why was the applicant’s name on the quotes and invoices. She said “probably because the applicant took over.” She denied that he did a substantial amount of work on the property development. She said “he took over it because he always takes everything over.” When asked whether he was assertive on the building site she said “Yes, he was probably assertive because he was having time off work at that stage from his normal job, but he was still working at CST and still working at BeautyFULL. So yes, I would have thought that, because most of the things that were going on towards the renovations were for BeautyFULL, but Scruton Property was paying for it.”
Regarding the funds provided by Scruton Pty Ltd to Scruton Property she said Scruton Property will need to pay back those funds. She accepted as a proposition that inter-company loans could be forgiven and added “I don’t think it was.” She maintained that the applicant had exaggerated the time spent on meetings to discuss the renovation project at 1024 Logan Road and the work he performed and said the work went over budget.
She accepted as a proposition that the amount of rent a lessee pays to a landlord depends on the type of building that they lease and agreed that a building that had been renovated, had the walls painted, had new air- conditioning installed, had significant improvements, would command more rent than a property that had not been improved. She agreed that there would be a monetary benefit for a landlord in those circumstances but added “except when the landlord actually had to help pay for the fit-out for BeautyFULL……when we moved into the Mount Gravatt premises we did a complete fit-out there as well. We lowered ceilings and put walls up. We were only doing what most people do when they go into a building that probably isn’t completely right for the purposes.” I found Margaret to be a credible witness.
Kate Scruton
Kate Scruton relied on her affidavits filed on 8 September 2020 and 15 October 2021. She deposed she was a director of Scruton Property and the only reason she became a director was because it was a family company. She had minimal involvement as director and was not paid for that role, did not sign documents or attend director’s meetings. At the time she was focused on raising the parties’ two children. She received a weekly payment from BeautyFULL from 6 August 2017 of $400 per week regarding her employment in the business. On 8 July 2018 her salary with BeautyFULL increased to $800 per week. The applicant was not paid a salary by BeautyFULL between December 2017 and June 2018.
She denied that she gave the applicant any directive or made any request of him to perform work for Scruton Property. She disputed that he was working 40 to 50 hours per week in late December 2017 to early January 2018. She said during that period they were holidaying on the Gold Coast with their children. Counsel for the applicant suggested that the applicant continued to receive phone calls about the development while on holiday in early January 2018. She did not recall hearing much about the work during that period. She said most trades were shut down over that period and she did not believe much work was going on however she did accept that the applicant received several calls from trades during that period.
She said between January and March 2018 she was involved in considering and making decisions relating to the fit out the BeautyFULL clinic at 1024 Logan Road including selecting interior paint colours, tiles, cabinetry designs, stone benchtops, signage and other design and furniture selection for the reception area and six clinic rooms, medical beds, linen and décor. She attended various suppliers to select materials. She made decisions about the interior layout of the clinic including mapping and marking out additional rooms and knocking down and erecting walls. She said the applicant was also involved in making decisions about the fit out as well and together they would meet with tradesmen to discuss aspects of the fit out and would attend various shops to view and buy items. Until March 2018 she often attended 1024 Logan Road to view the progress of work and oversee the progress. She occasionally saw the applicant on site speaking with Chris Lindeman but did not see him perform any type of labour work. He frequently worked from home and had remote access to systems used by the businesses. She said the fit outs were completed by March 2018 and BeautyFULL commenced operating from 1024 Logan Road. She worked there six days a week from that time.
During cross examination she agreed that the applicant was working and contributing to the development at 1024 Logan Road. She disputed that he spent a significant amount of time on the Logan Road development. She accepted he had conversations organising trades and said he did that predominantly from home. She agreed he managed the site from home but, from time to time, he would go to the work onsite. She agreed that at no time did she stop him from performing that work and she was aware that the applicant was doing the work and organising trades that would eventually be payable by Scruton Property. She accepted that Scruton Property was liable to pay for work performed by the tradesmen.
She agreed that Margaret set the budget for the development of 1024 Logan Road and that BeautyFULL and CST were the proposed lessees. She said CST was going to move into part of the property and use the premises after all the painting had been done and a few bathrooms had been fixed and there had been other sorts of works. She agreed that BeautyFULL was to occupy the premises at 1024 Logan Road and pay rent to Scruton Property however she was not aware that BeautyFULL did not pay rent for some months after moving in. She accepted there was no lease agreement executed prior to June 2018 between BeautyFULL and Scruton Property.
She agreed that she was involved in the meetings described by the applicant in his affidavit but said he had exaggerated the time spent in each meeting. She had spent 10 hours researching suitable properties for BeautyFULL to operate from prior to the purchase of 1024 Logan Road and did not recall whether the applicant attended Coco Republic to purchase the chandelier.
She said the applicant played golf several times about three or four times a week. When shown Exhibit A2 a schedule of the holes of golf played by the applicant between December 2017 and June 2018 at different golf clubs she did not accept those were the only occasions he played golf and clarified her evidence that he played (or practised) golf for five or six hours.
She said during the period Logan Road was developed the applicant was preoccupied with a criminal charge and spent a lot of time researching and reading. When asked to particularise her evidence her answers were vague. Counsel suggested “you’re just making this up now, aren’t you” which she denied. She disputed that the applicant “took on the development of 1024 Logan Road full time.” She said there was a social component to it and in her view he had exaggerated the time he spent on different tasks. She and the applicant separated in June 2018 and she rarely saw the applicant on site after that. I formed the view that Kate was doing her best to tell the truth when giving evidence.
Mark Scruton Sowden
Mark Scruton Sowden relied on affidavits filed on 20 May 2020, 8 September 2020, 21 April 2021 and 14 October 2021. He described his occupation as a manager. He deposed that Scruton Property was established as a holding company and had no employees. It did not pay any director remuneration and remuneration for directors had never been raised by the applicant or any director of the company at any time, had never been considered by the board of directors or approved by resolution at a general meeting.
Regarding claims by the applicant that he assisted in organising registration of the holding company Scruton Property and was involved in investigating and selection 1024 Logan Road as suitable commercial premises for BeautyFULL Mark said the “company” engaged Rod Holloway and Co Solicitors to undertake conveyancing work regarding the purchase of the two commercial properties by Scruton Property and Belle Property to act as property manager for 29 Lamette Street Holland Park. He said Rod Holloway and Co and Place Real Estate organised the clauses for the contract and settlement of the contract. This was a straight forward process and the applicant’s role in the purchase of 1024 Logan Road was limited to putting forward some ideas many of which did not benefit Scruton Property but rather the two companies BeautyFULL and CST for which he was a director. During cross examination Mark agreed that the applicant provided advice that a holding company be established to purchase property. Counsel suggested that the sole purpose of the company was to insulate the company against risk a proposition the witness accepted.
He said 1024 Logan Road was subject to a rezoning application prior to being purchased by Scruton Property and the applicant had no involvement in progressing that application. He denied that the property was rezoned while the applicant was a director but rather on 26 July 2019 over a year after he was removed as director. He said the company engaged Gateway Survey and Planning to undertake the rezoning submission for both 27 and 29 Lamette Street however neither submission was successful. The company engaged professional building inspectors and property managers to conduct property inspections. He was not sure whether they obtained a building inspection for 1024 Logan Road and said “it didn’t matter as we would be doing work to that property.” I accept that evidence.
Mark agreed that the commercial properties were purchased for the primary purpose of obtaining rental income for Scruton Property. From March 2018 BeautyFULL was a tenant and CST “between April and December 2018.”
He disputed that the applicant performed work for Scruton Property. He said the applicant was never employed by Scruton Property nor directed by any director of the company to perform any task but worked of his own volition and simply assisted in the preparation and lodgement of Scruton Property’s BAS for the quarter ending 31 December 2017 and 31 March 2018 and periodically provided general input into the purchase of the commercial properties. Any accounting tasks performed by the applicant were minimal and straightforward including maintaining the company books. He said the applicant would spend no more than 30 minutes per financial quarter compiling information for accountants.
He said Christopher Lindeman was appointed as site foreman and completed the construction work on the two commercial properties. He was paid for that work including organising trades and liaising between trades as a representative for the company. He denied that the applicant performed work as onsite manager or project manager. The email sent to Mark on 8 October 2018 confirmed that Christopher Lindeman was appointed as site foreman.
Mark denied that the applicant was an employee and said there was no written employment agreement or contract between the applicant and the respondent. He argued that if the applicant performed work for Scruton Property the respondent would have had control over the decision as to when to do that work. He could not recall the applicant asking him or any director whether he could take time off. He said if he did any work it was minimal and Scruton Property exercised no control over the work the applicant performed nor did the directors of the respondent direct what work the applicant was required to do. He was unaware that his mother had any control over the work performed by the applicant r directed him to perform tasks and said that Kate had no involvement with Scruton Property. As far as he was concerned the applicant “performed all work at his behest.” He agreed that the applicant was not paid by Scruton Property and said no directors received any payment or benefit from Scruton Property.

On 29 July 2018 the applicant was removed as a director of Scruton Property. Mark said he and Margaret remain directors of Scruton Property and Margaret remains the sole shareholder. He claimed that the applicant’s removal as a director was undertaken in accordance with the Constitution where a Notice of General Meeting was delivered to the applicant’s address.
He denied the allegation that the applicant was not allowed on the site from 29 June 2018 and said the applicant continued to attend the site after that date to perform work for CST including book keeping, creating and preparing the new CST Zenoti software for implementation and general accounting duties as CFO for CST. He said the applicant told him this when he attended the site after 29 June 2018.
Mark denied having conversations with the applicant and denied he asked the applicant to perform work. He said the meeting he attended with the applicant[5] was to discuss the fit out for BeautyFULL and CST and only minor changes were required to the existing layout. He accepted there was a meeting to discuss costs and added that was because “BeautyFULL would be paying back Scruton Property.”[6] The meeting lasted only 30 minutes. He agreed there was a meeting that related to construction of a car park which was to be used by staff and clients.[7] He disputed the time taken to select the chandelier for BeautyFULL but accepted he was not involved in that matter. He indicated the applicant had significantly exaggerated the estimates of time he provided as to the applicant’s attendance at various meetings and observed that some of the meetings were for the benefit of BeautyFULL for which the applicant was a shareholder. He denied the applicant performed work to dig and plant 5 metres of hedging and said this was already on the property. He said he planted four small shrubs at the front to fill in a gap in the hedge.
[5] Item 23 Applicant’s affidavit filed 11 January 2021
[6] Item 24 Applicant’s affidavit filed 11 January 2021
[7] Item 25 Applicant’s affidavit filed 11 January 2021
Mark initially disputed that there was no executed lease between the tenants BeautyFULL and CST and Scruton Property and said there was an executed lease. He was asked to produce any executed lease agreement. He said “I believe there was (an executed lease), but not when they first started operating or when they first started doing the fit-outs.” He was asked for the date of the executed lease agreement. He said “there was not an executed lease for CST, but there was an agreement, and they did start paying rent.” He then said there was a “verbal lease” and agreed “there was no signed document.” Counsel suggested that by July 2018 (after the applicant had been removed as a director from BeautyFULL) “there was no executed agreement in relation to a lease between BeautyFULL and Scruton Property was there?” He said “No, but I had requested it.” He agreed that he was at that time a director of Scruton Property. He was asked whether he wrote of letter of demand to BeautyFULL. He said he sent emails and there was correspondence. Counsel suggested his evidence was untrue.
I find that notwithstanding the initial agreement that BeautyFULL and later CST would occupy 1024 Logan Road as tenants once the improvements were complete neither the applicant during the period he was involved in the development between December 2017 and 18 June 2018 or Mark following the applicant’s removal as director arranged to have any formal lease agreement drawn up between Scruton Property and BeautyFULL or CST. There was no documentary evidence that either company paid any rent to Scruton Property during the time those companies occupied the premises.
Mark was asked about the statement in his affidavit “It …would have been financially unviable for the respondent to employ the applicant or any other person.” Counsel asked if the reason for that position was that the entity Scruton Property did not want to incur any liabilities. He disagreed and said the reason was because the income didn’t support an employee. It was suggested that there was no income as Scruton Property was a holding company. He accepted that.
Mark was asked whether he agreed that the applicant did a significant amount of work at 1024 Logan Road between December 2017 and June 2018. He said “yes for the benefit of BeautyFULL and CST.” Mark denied he observed the applicant performing labouring work. He said at the time he was working full time as a real estate agent so he would drive past. The only persons he saw were tradesmen. He said though he made it his purpose to go through every room when he attended the site he did not see the applicant there.
Counsel suggested that there were three separate components of the work undertaken for Scruton Property: a fit-out for BeautyFULL that was going to occupy a space, a fit-out for a lessee called CST and external works being done to driveways and carports and suggested that there was no break down for each entity regarding the cost of those works. Mark disagreed and said there were fit – out costs for BeautyFULL which included the third area being the car park and “That area was not a part of CST.” He said as the applicant was a director of CST and BeautyFULL he believed there was a fit-out cost for CST that was documented. No documents were produced with respect to any breakdown for the work performed specifically for BeautyFULL or CST or work performed on the exterior and structure of the commercial premises including the car park. It was not possible to determine the cost of work for any specific entity. The evidence suggests a budget was set for the project as a whole.
Mark agreed that Chris Lindeman was the carpenter working on the CST space and he issued invoices to Scruton Property for works done in relation to BeautyFULL and CST. Counsel suggested his invoices were very general “because they would often just say the address, being 1024 Logan Road, and they would say ‘Labour for carpentry work’ and did not delineate what the carpentry work was or where that took place. It was suggested that all subcontractors, electricians and plumbers and Chris Lindeman simply invoiced Scruton Property for that work done. He agreed. When pressed by Counsel about this issue further he denied that the work being done was for Scruton Property. He accepted that the invoices indicated that to be the case and said “that’s because the applicant had done it that way but the work as per the conversations and the messages were that it was to be done that way for BeautyFULL because they couldn’t afford the work. That’s why it was to be paid back, all costs.” I found Mark’s evidence confusing. I find that Scruton Property through its directors engaged tradesmen and paid those persons for work performed.
Mark was asked if he agreed that Scruton Property paid for all work at the property between December and June 2018 including the BeautyFULL space fit-out, the CST space fit-out and any work done outside of the property in the garden and car park. He said he did not know if it paid for all work, but it would have paid for the majority of work.
He was asked as a director of Scruton Property whether he ever stopped the applicant from working onsite or contributing in any capacity such as labouring or directing trades or in his capacity as project manager or in his capacity in dealing with accountancy work. He said it was his understanding that the work he was undertaking was for BeautyFULL so he believed he had no right tell the applicant to cease work because Scruton Property was leasing to BeautyFULL.
He agreed that from time to time the applicant would attend the site to perform work for CST. He was aware he received a salary from CST. He denied the money the applicant was receiving was for work he had performed for CST prior to January 2018. He said the applicant told him he was receiving wages from his employer at WorkCover of 50% of his salary. He said he was paid as a CFO for CST because he was doing the accounting work and implementing the system for CST. He believed CST were paying him exactly half of his salary to “top up” his wage. He accepted that he was not aware how much work the applicant performed for CST at the time.
Mark was asked questions about a statement he made that “a company controlled by (himself) funded the company’s purchase and development of the two properties… 1024 Logan Road and then 28 or 29 Lamette Street.” Counsel asked “when you say you controlled those companies, can you particularise that for me? Which companies – were you a director or a shareholder?” He said he was a director at the time of Scruton Property. Counsel asked “You say that: A company controlled by myself – so a company separate to Scruton Property Pty ………. Which company was that? He said “Scruton Proprietary Limited.” He was asked what his role was in that company and he said he was a director. He was not a shareholder and agreed that his mother was a director of the company and the only shareholder. Counsel suggested that his mother controlled the company. He denied that and said “there’s a bloodline trust and I’m in the bloodline, so if the company earned less money I would be directly affected.” Counsel suggested that it was his mother who made the funds available as the sole shareholder of Scruton Pty Ltd. He said “No that’s false.” He said Scruton Pty Ltd “got its money through me...I was the director and I would place the money into Scruton Property.”
He denied that his mother as the only shareholder of Scruton Pty Ltd, was the one who had ultimate oversight over the money coming in and going out. He said that was the role of the director. He was asked “Well, she is the one who could sack a director, isn’t she.” He agreed but said as he was a director he would make the decisions. He was the one who controlled whether money was paid from Scruton Pty Ltd to Scruton Property. Counsel suggested that the “buck stops with Margaret Scruton in relation to money and the project” He denied that. Counsel suggested that it was Margaret Scruton, “who was the one who was, effectively, pulling the strings with the money to fund the building and to fund the purchase of the property and the construction at the site.” He denied that. He said he controlled Scruton Property.
Counsel suggested that from time to time he and Kate, but specifically he had knowledge of the development and the applicant’s involvement, they set a budget for the property development and told the applicant that budget. He denied that and said he told Christopher Lindeman, who was the site supervisor, they wanted to stick to a budget. He was asked whether he set the budget. He said the budget would be determined on what renovations were needed for BeautyFULL and CST. He agreed that the applicant helped with setting the budget “because he knew how to run a medical clinic.” He denied that he and the other directors would set timeframes for the applicant to complete the work. He said there was a timeline set by the applicant because BeautyFULL was moving into the premises as the rent had gone up where they were and the applicant wanted to move to those premises so BeautyFULL could start operating there because they would have more consulting rooms and be able to see more people. He was asked whether the property was an asset for Scruton Property in that it would receive rent. He provided no satisfactory answer to that question.
He was asked “In a day-to-day sense, you accept that Mr Belcher had the majority of the oversight of the project and would report back to you and other directors from time to time.” He said “he wouldn’t report back to us, no. He would tell us if he had done something after he had already done it and say ‘What do you think of this’ but there was no reporting or anything. The reporting was done by Chris Lindeman, who was the site supervisor.”
He agreed that the applicant used his access to the company’s bank account as a director to pay tradesmen, plumbers and electricians and agreed that the invoices directed to Scruton Property were addressed to the applicant and had his email address and mobile number. He was asked “that’s because he was the one organising the subcontractors.” He responded “yes, he was the director of BeautyFULL. I would assume so.” He denied the applicant was undertaking a role as a project manager.
When asked why Chris Lindeman’s invoices were directed to Scruton Property he said “because we were paying for it.” He accepted that the applicant may have organised trades but said “I did not tell him to.” He was asked whether he accepted that the applicant was acting on behalf of Scruton Property when accessing the bank accounts to pay the tradesmen. He agreed and said as a director he had access to the bank account and accepted he performed some accounting work for Scruton Property in his capacity as director. Counsel suggested that there must have been regular conversation between the applicant and himself in his capacity as a director of Scruton Property since it was Scruton Property’s development and the company was liable to pay subcontractors and the contractors. He said he did not discuss anything with the applicant with respect to acting on behalf of Scruton Property. In his view the applicant was acting for the benefit of BeautyFULL.
Counsel suggested that the development of 1024 Logan Road was a substantive development where walls were painted, bathrooms renovated, demolition occurred in the car parking area and trees were lopped. Mark disagreed and said the improvements were minor. He denied that a budget of $250,000 would indicate it was a substantive development. He said the car park was created for “BeautyFULL’s staff and clients and CST staff.” He accepted that the lessees benefitted and at the end of the lease they would no longer be able to use the car park.
Work performed for BeautyFULL and CST
Much time was spent during cross examination about the work the applicant performed for two other companies BeautyFULL and CST between 14 December 2017 and 18 June 2018. The applicant agreed that during the relevant period he was a director and shareholder of BeautyFULL and CST. He accepted that he held a financial interest in CST “about 10% - I think it was 200 shares….Margaret also held 400 shares in CST.” He agreed he had a financial interest in BeautyFULL through the KG Belcher Family Trust as Trustee.
Counsel for the respondent cross examined the applicant regarding his CV where the applicant referred to himself as the chief financial officer of CST and managing director of BeautyFULL from 2010 to 2018. He confirmed that his CV was up to date. Counsel suggested that his CV he made no mention of his role or any arrangement at all with Scruton Property. It was suggested that this was because he didn’t consider he had any employment role with Scruton Property. He said “Well, it’s not part of my CV. I’m an accountant so (regarding) property development if I’m going for a job I’m not worried about what I’ve done in property.” Counsel suggested “Well, it’s not quite right though, is it, because managing director of BeautyFULL Cosmetic Medical Clinic, that doesn’t refer to just accounting stuff, does it? It refers to things like strategic direction of the company – I’m looking at the second dot point there: Client retention, advertising and marketing. That’s not an accounting practice, is it? He said “No. But I’ve done a Bachelor of Business.” He was asked why he did not include any reference to the work he performed for Scruton Property in his CV. He said he did some bookkeeping on the side currently and did not include that work in his CV. I found the applicant’s response unsatisfactory and formed the view that if he had considered an employment relationship existed between himself and Scruton Property during the period he asserted he would have included that information in his C.V. after all he asserted that he performed the task of project manager of a significant development of commercial premises.
The applicant was asked about the work he performed for BeautyFULL between December 2017 and June 2018. He said he handled the finances for BeautyFULL and used Xero accounting software. He didn’t need to do much for BeautyFULL, in the sense of financial accounts and completed these himself. Using Xero was simple. He prepared financial forecasts for BeautyFULL by using an Excel spreadsheet and basically made all the financial decisions for the business. He did not meet Margaret or Kate to discuss this. He managed the cash flow as BeautyFULL and bought supplies. He would look at the inventory and purchase Botox when supplies were low. He said the girls that worked there purchased gloves and other stock but he maintained the bigger items like Botox and fillers because they cost tens of thousands of dollars. Other small items were $500 or $1000. He would purchase the bigger items once every two weeks via an email order. He was normally told by staff if they were running low on supplies. He completed the BAS but not the annual returns as that was done by an accountant. He made the decisions about marketing strategy for the business but this was not a demanding task as BeautyFULL was on Facebook and Instagram and there was no charge for this. Regarding client retention he said he was trying to get repeat people to come back every three to four months for treatment and organised to send out SMS messages. He used online software for customer management but could not recall the name of the program. He said he made no decisions about medical decisions that was Kate’s area. The business employed a clinic coordinator who managed the roster and he managed any staff difficulties. He estimated his work with BeautyFULL took about 10 hours a week most of it when he was onsite. He was not paid for the work he performed for BeautyFULL. I am satisfied that between December 2017 and June 2018 the applicant’s focus as manager director of BeautyFULL was to ensure the smooth transition of the business to new commercial premises. In my view that was the project the applicant was invested in and the primary purpose of the Logan Road development was to improve and enhance the operation of the BeautyFULL cosmetic injectibles business.
The applicant was questioned about the work he performed for CST between December 2017 and June 2018. He said he undertook minimal work for the business. He was CST’s chief financial officer in 2018 up until June or July. He worked only about one or two hours a week during that time for CST. Prior to December 2017 he created a “What-if” model for the business which was essentially a financial projection of how many franchisees could be achieved. He agreed he was required to update the CST budget as new franchisees came on but said that task was simple and would take no longer than “two minutes.” He did some bookwork for CST but had already done all the preparatory work for the franchise business which was largely automated. His work for CST began in April or May 2016. He agreed that he released a performance report monthly at the end of each month for CST. He said Paul Roati and Carol Morgan also worked with the spreadsheet that he had developed and had access to it and also access to the “What-if” model. He said if someone made an error he could correct it by using Version History and reopening the old version “a function of OneDrive.” He denied this was a hassle or took any significant time. He said “It’s two clicks of a button. You click “Open version”, and then that’s it.” He said there was very little work involved in his role as chief financial officer with CST. It was a simple process “if you get a franchisee 20 – you literally change it to 21. Depends if it’s a clinic or a nurse. There was basically a couple of different variables like two variables, and the model was built on an average daily bill-outs. There’s calculations in behind the scenes that are locked down, hidden. They (Carol and Paul) can’t change those. They literally change two – basically two variables. If there was a clinic or a franchise, they would update it or they change it. It takes like 30 seconds to change it.” He disagreed he needed to change other variables including equipment, supply costs for CST. He said no “they did it all themselves.”

Whether a person is an employee or not is a question of law: ACT Visiting Medical Officers Association v Australian Industrial Relations Commission [2006] FCAFC 109. With respect to the relationship of employer and employee the Court said at [19] - [21]:
“[19]    There are numerous factors that may point to the contract being one of employment and their relative importance will vary with the circumstances. The measure of control that the putative employer is entitled to exercise over the worker is a prominent factor but it is not the sole criterion; it is merely one of a number of indicia; Stevens v Brodribb Sawmilling Company Proprietary Limited (1986) 160 CLR 16 at 24 per Mason J (with whom, on this point, Brennan and Deane JJ agreed); Zuijs v Wirth Bros Pty Ltd [1955] HCA 73; (1955) 93 CLR 561 at 571-572; Hollis v Vabu Pty Limited [2001] HCA 44; (2001) 207 CLR 21 at 40-41. In Stevens v Brodribb, Mason J also commented at 24, that other relevant matters included, ‘the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work and provision for holidays, the deduction of income tax and the delegation of work by the putative employer’. In the same case Wilson and Dawson JJ mentioned, at 36, the following additional factors:
‘the right to have a particular person do the work, the right to suspend or dismiss the person engaged, the right to the exclusive services of the person engaged and the right to dictate the place of work, hours of work and the like.’
[20]     Their Honours cautioned that however comprehensive the list of relevant factors they could never be determinative but only a guide to the existence of a master and servant relationship. Their Honours continued:
The ultimate question will always be whether a person is acting as the servant of another or on his own behalf and the answer to that question may be indicated in ways which are not always the same and which do not always have the same significance.’
[21]     In Marshall v Whittaker’s Building Supply Co [1963] HCA 26; (1963) 109 CLR 210 at 217 Windeyer J made the same point, commenting that the fundamental distinction is:
‘between a person who serves his employer in his, the employer’s business, and a person who carries on a trade or business of his own.’
I am not satisfied that there was any intention on the part of the directors of the respondent to create legal relations. There was no written or oral contract of employment between the applicant and respondent and no evidence of any terms or conditions oral or written imposed on the applicant with respect to any engagement for or on behalf of Scruton Property. In so far as the applicant contends that Margaret on behalf of Scruton Property requested that he oversee or manage the development of 1024 Logan Road I have found to the contrary. There was no agreement that the applicant would project manage any necessary improvements to 1024 Logan Road.
Though not determinative I do not accept that the respondent had any measure of control over the work performed by the applicant. The applicant decided what tasks needed to be undertaken for example he obtained quotes for plumbers, electricians, excavators and the like and in consultation with Chris Lindeman who had building expertise. He developed a timeline regarding what work would be undertaken and completed and updated the directors of Scruton Property. He did not require the prior approval of any of the directors of Scruton Property to perform any task nor was he requested to perform any specific tasks pursuant to a particular timetable. None of the other directors had any control over the decisions when various tradesmen would be engaged. None of the other director’s directed the applicant to perform any task for Scruton Property but were simply advised after the event by way of update regarding work that had been completed. I accept that discussion may have taken place with Margaret for further funding for large items for example re-roofing.
I accept the applicant’s evidence that he was under no obligation to work particular hours or particular days and he chose when to work, when to attend the site and when to work for home. He was not required to seek approval for holiday leave and did not seek approval when he holidayed on the Gold Coast over the 2017 Christmas break. He kept no time sheets, no payslips were issued to him during the time he performed work including for accounting work undertaken by him. He received no income or wages from Scruton Property and paid no taxes. I take into account that the applicant is and was at the time a certified practising accountant and would have been well aware of the necessary requirements with respect to Scruton Property employing the applicant to perform work including a requirement to comply with legislation. No evidence was adduced of any offer of employment to the applicant from Scruton Property nor any evidence of any contract of employment. The applicant conceded there was no discussion about any specific remuneration or rate of pay for work undertaken. I reject the applicant’s evidence that he raised with the directors of Scruton Property the issue of being paid for work performed and accept the evidence of Margaret, Kate and Mark that payment for any work performed by the applicant was not discussed.
I am satisfied that as the applicant was on long service leave he made himself available to ensure the project was completed in a timely manner. I accept Margaret’s evidence that he was required to take time off work due to criminal charges he was facing and he was pre-occupied with that matter. I am satisfied that the work he performed in assisting in the improvements of Logan Road provided him with an opportunity to distract himself from pending criminal charges.
I accept Chris Lindeman’s evidence that the improvements of Logan Road that related to BeautyFULL were largely complete by March 2018 when BeautyFULL moved in and commenced operating. After 18 June 2018 the applicant continued completing accounting work for Scruton Property for a period and received emails and invoices from tradesmen and authorities in relation to the property development. He said Mark removed his access to Scruton property’s bank accounts and he was removed from the company as a director without notice. Mark disputed this and said the applicant’s removal was consistent with the Scruton Property’s constitution. Having regard to the totality of the circumstances I find that any work the applicant performed for Scruton Property was as a volunteer. The applicant has failed to establish that he was employed by Scruton Property between 14 December 2017 and 18 June 2018.
Did the respondent contravene the Fair Work Act 2009 (Cth) as asserted by the applicant
Given my finding that the applicant was not employed by Scruton Property during the relevant period and that no relationship of employer employee existed between Scruton Property and the applicant I am satisfied that there has been no contravention of any provision under the Fair Work Act. That application is dismissed.
Was the respondent in breach of a statutory duty under the company’s constitution
The applicant contends that Clause 88 of the respondent’s constitution gives him a contractual right to be remunerated for the work he performed.
It is not in dispute that the respondent’s constitution is a statutory contract under section 140 of the Corporations Act (Cth). The applicant contends that clause 88 of the company constitution entitles the applicant to remuneration for “other work” performed by the applicant. The respondent contends that clause 88 does not create a contractual right to payment in itself and argues that for a director to be entitled to remuneration one or more of the following would need to occur:
(a)there would have to be agreement of the other directors on the respondent’s behalf; or
(b)there would have to be a shareholder’s resolution; or
(c)the applicant and respondent should have entered into a separate contract.
Company Constitution
Scruton Property was registered on 26 June 2017 and is governed by a modified company constitution, which ousted the “replaceable rules” in the Corporations Act 2001 (Cth). By force of section 140 (1) (b) of the Corporations Act 2001 (Cth) a company’s constitution (if any) and any replaceable rules that apply to the company have effect as between the company and each director and company secretary under which each person agrees to observe and perform the constitution and rules so far as they apply to that person.
There is no dispute that the company’s Constitution is a statutory contract between Scruton Property and each respective director, including the applicant between the period of 26 July 2017 to 28 June 2018. The terms of the Statutory Contract expressly included (amongst others things) that:
“cl. 85. Directors of the company shall be paid the remuneration that is decided upon by a resolution of a general meeting of the company; or by resolution of the directors until such time as the general meeting can reasonably pass such a resolution.
cl. 86    The company may pay directors' expenses, including travel and accommodation expenses, where the director incurs such expenses in attending directors' meetings, committee meetings, general meetings, or otherwise in connection with the company's business.
cl. 87   If the directors do not set different fee amounts for different directors, then all the fees must be equal, Directors' fees accrue daily.
cl. 88   Directors are entitled to be remunerated for other work (including professional work) for the company, and are entitled to hold another office with the company. The exception is that no director may hold an office of auditor or do auditing work for the company.”
The applicant argues that on the proper construction of the Statutory Contract:
(a)the Services undertaken by the applicant were for “other work” performed for Scruton Property, as contemplated in clause 88 of the Statutory Contract;
(b)Scruton Property agreed to reasonably remunerate the applicant for his Services; and
(c)the applicant was entitled to be reasonably remunerated by Scruton Property for his Services.
The applicant contends that the terms of the Statutory Contract include by implication that the remuneration a director was entitled to for “other work” under clause 88 would be reasonable remuneration (i.e. an implied term). Counsel argued that an implied term forms part of the Statutory Contract as a matter of law or is reasonable and necessary in an agreement for a person to be remunerated for work performed. Alternatively as a matter of fact the implied term is reasonable and necessary to give business efficacy to the Statutory Contract, is so obvious it goes without saying, is capable of clear expression and is consistent with the express terms of the Statutory Contract.
The applicant contends that Scruton Property has breached clause 88 of the Statutory Contract and as a consequence of the respective breaches, the applicant suffered loss and damage. The applicant claimed reasonable remuneration as assessed in the report of James Thorburn forensic accountant.
It was submitted on behalf of the applicant that a director of a company has an entitlement to remuneration when authorised “by the instrument which regulates the company or by the shareholders at a properly convened meeting” [10] In Kelly v Commissioner of Taxation [2013] FCAFC 88 at [114] per Lander, Siopis and Gilmour JJ the Court said:
[114]             The common law has long considered that a director, as a fiduciary, is not entitled to remuneration, unless and until authorised “by the instrument which regulates the company or by the shareholders at a properly convened meeting” (In re George Newman & Co [1895] 1 Ch 674 at 686; Hutton v West Cork Railway Company (1883) 23 Ch D 654 at 672 per Bowen LJ). Further, the constitution of a company operates as a contract between the director and the company (s 140 of the Corporations Act)…
[116]    Further, the existence of the contract …… ruled out any possibility of a quantum meruit claim by a director (see for example, Pavey & Matthews Proprietary Limited v Paul [1987] HCA 5; (1987) 162 CLR 221 at 256 per Deane J (Mason and Wilson JJ agreeing at 227)).”...
[119]   …A director’s entitlement to remuneration arising upon compliance with the constitution of a company is neither irrational, nor capricious. Rather it is the contractual provision by which a director’s entitlement to remuneration if any is created.
[10] Re George Newman & Co [1895] 1 Ch 674 at 686 per Lindley LJ
The applicant submitted that the effect of section 140 of the Corporations Act 2001 (Cth) is that there is an enforceable contract between the company and each director. No “extra agreement” is required to give effect to the company’s constitution. Relevantly the company constitution is the instrument which regulates payment of remuneration to directors. He argued as follows with respect to the approach to be taken in construing a contract:
(a)in determining the terms of a commercial contract it is necessary to ask what a reasonable business person would have understood the terms to have meant;[11]
(b)the whole of the instrument is considered to discover the objective intention of the parties;[12] and
(c)if the language of an instrument is open to two constructions the construction which should be preferred is that one which avoids an outcome which is “capricious, unreasonable, inconvenient or unjust”;[13]
[11] Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 116 per French CJ, Nettle and Gordon JJ
[12] Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99 at 109 per Gibbs J
[13] Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99 at 109 per Gibbs J
The applicant submitted that “other work” in clause 88 is work that does not concern a director’s fundamental or basic obligations as director being those contemplated by clause 86. The only one exception to the entitlement to remuneration for “other work is for a director holding an office of an auditor or doing auditing work for the company. It was submitted on behalf of the applicant that the construction contended for by the respondent i.e. that a resolution or extra agreement under clause 85 is required if a director were to be remunerated for “other work” is incongruent with the constitution as a whole. If it was intended that a resolution or separate agreement was required before a director could be remunerated for “other work” then that term would have been included in clause 88.
Counsel for the respondent argued that in interpreting a contract the court will give effect to the ordinary meaning of the words unless that would lead to absurdity: Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [46] – [47]. Further the court will endeavour to give the document meaning that would avoid giving rise to commercial inconvenience: Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [51]. Counsel for the respondent contends that the company constitution should be construed as a whole and an interpretation that creates harmony between its various parts is to be preferred. Counsel relied on the decision of the High Court in Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99 at 109.
In Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [46] the Court held that the process of construction involves consideration of the words of the contract in light of their context and purpose. It was argued by Counsel for the respondent that extrinsic evidence may assist in identifying the commercial purpose of a contract as it may provide insight into the context and purpose of the document’s words: Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at [22]. Where words are unambiguous extrinsic evidence cannot be used to contradict their plain meaning: Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 at 352.
The respondent contends that the preferred construction of clause 88 is that it allows the directors to be remunerated for work they do for the respondent only if it is agreed to by the other directors, shareholders by resolution or some separate contract. The respondent rejected the contention that a director accrued an automatic right to be paid if they did work for the respondent as this would expose the respondent to unknown financial liabilities and lead to commercial inconvenience. The respondent relied on the decision in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [51] and argued that the construction to preferred is a construction consistent with clause 85 which requires director’s remuneration to be set by resolution of a general meeting of the company.
The respondent argued that assuming the words in clause 88 are ambiguous the extrinsic evidence indicates that none of the directors received remuneration from the respondent. Mark’s evidence that none of the directors of Scruton Property received any payment was not challenged. Further the respondent contends and the Court has found that during the time the applicant performed work the applicant did not raise the issue of remuneration with any of the directors.
At the time the applicant was undertaking work for the respondent he was a director of Scruton Property and a certified practising accountant. It was open to the applicant to raise the issue of the existence of the statutory contract with the directors regarding payment for “other work” and seek a resolution regarding remuneration for payment. He did not do so.
I have found that the applicant did not raise any issue about payment or remuneration for work he said he performed for Scruton Property at all. I note on his own evidence he conceded that he did not raise any specific amount of payment or remuneration during the relevant period nor did he suggest at the time that the amounts he now contends to be reasonable remuneration were raised with any of the other directors for Scruton Property.
I have found that any work performed by the applicant for Scruton Property was as a volunteer in his capacity as director. Further I am unable to determine with any precision how much work the applicant undertook for the respondent having found that he exaggerated his claim for 40 to 50 hours per week over a period between December 2017 and 18 June 2018.
The issue of remuneration or rate of pay for any director was not considered by the board of directors or approved by resolution of a general meeting of the company. Nor was the issue of remuneration for “other work.” The applicant had access to the respondent’s bank account but did not pay himself any money and I infer that the applicant was operating on a basis that if he required payment for any other work performed for the respondent there would need to be a resolution or agreement to that effect.
The respondent contends that although clause 88 allows a director to be remunerated for “other work” it does not create an automatic entitlement to it. I accept that in construing a contract the whole of the instrument should be considered to discover the objective intention of the parties.[14] I am satisfied that having regards to clauses 85 to 88 the applicant was required to seek a resolution or agreement amongst directors regarding reasonable remuneration for other work performed for the company.
[14] Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99 at 109 per Gibbs J
The respondent argued in the alternative that should the court find that clause 88 does create a contractual right on its own for directors to be paid remuneration, the clause must be void for uncertainty it being an essential term to an employment contract that the parties have agreed on wages: Brunette v Integral Energy Australia [2003] NSWIR Comm 324 at [87]. Counsel argued that the applicant seeks to avoid the need for certainty by saying that a term can be implied into the respondent’s constitution that directors are entitled to “reasonable remuneration” however the term cannot be an implied term. The respondent relied on the decision in Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at [29] where the High Court said “the ‘necessity’ which will support an implied term in law is demonstrated where absent the implication ‘the enjoyment of the rights conferred by the contract would or could be rendered nugatory, worthless or perhaps seriously undermined.” The implication of the contended term that an employee will be paid reasonable wages is not a duty and cannot be implied at law nor can the term be implied in fact either. The requirements for a term to be implied are set out in BP (Refinery) Westernport Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283. In Byrne & Anor v Australian Airlines Limited (1995) 185 CLR 410 at 422 the court cited with approval the decision of Deane J in Hawkins v Clayton (1988) 164 CLR 539 at 573 to the effect that BP (Refinery) Westernport Pty Ltd v Shire of Hastings (supra) criteria for implying a term into a contract should be avoided where there is no formal contract. The respondent contends that this statement would not apply in the applicant’s case as the respondent’s contract is a formal contract between the parties and the criteria espoused in BP (Refinery) Westernport Pty Ltd v Shire of Hastings would operate. I find this unnecessary to answer.
Conclusion

I rely on my findings in the judgment. The applicant exaggerated the work he performed on the improvements on the Logan Road premises. Though he performed some work I am unable to determine what work was performed and the amount of work performed for Scruton Property. I have found that no employment relationship existed between the applicant and Scruton Property with respect to any work performed and have found that the applicant volunteered to perform work for Scruton Property.
I have found that the applicant made no request for remuneration for any work performed including any accounting work. No general meeting was held to resolve what constituted remuneration for other work performed as required by clause 85. Though pursuant to clause 88 a director was entitled to be remunerated for other work, I am unable to quantify the “other work” performed nor determine what would constitute “reasonable wages.”
I am not satisfied that the applicant has proved a breach of statutory contract. That application is dismissed.

I certify that the preceding one hundred and seventy-six (176) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Tonkin.
Associate:
Dated: 19 April 2022

File number(s):	BRG 222 of 2020
Judgment of:	JUDGE TONKIN
Date of judgment:	19 April 2022
Catchwords:	INDUSTRIAL LAW – Whether employment relationship existed – whether respondent in breach of Fair Trading Act-whether respondent in breach of statutory contract – application dismissed
Legislation:	Corporations Act 2001 (Cth) Fair Work Act 2009 (Cth) Federal Circuit Court Rules 2001
Cases cited:	ACT Visiting Medical Officers Association v Australian Industrial Relations Commission [2006] FCAFC 109 Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99 BP (Refinery) Westernport Pty Ltd v Shire of Hastings (1977) 180 CLR 266 Brunette v Integral Energy Australia [2003] NSWIR Comm 324 Byrne & Anor v Australian Airlines Limited (1995) 185 CLR 410 Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 Collins v Trimatic Contract Services Pty Ltd & Ors (No 5) [2019] FCCA 1018 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 Hawkins v Clayton (1988) 164 CLR 539 Hollis v Vabu Pty Ltd [2001] HCA 44 Kelly v Commissioner of Taxation [2013] FCAFC 88 Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451
Division:	Division 2 General Federal Law
Number of paragraphs:	176
Date of last submission/s:	25 November 2021
Date of hearing:	19- 21 October 2021
Place:	Brisbane
Counsel for the Applicant:	Mr Amerena
Solicitor for the Applicant:	Workplace Law Group
Counsel for the Respondent:	Mr Hogg
Solicitor for the Respondent:	McInnes Wilson Lawyers

BRG 222 of 2020
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:	GUY ANDREW BELCHER Applicant
AND:	SCRUTON PROPERTY PTY LTD ACN 620 687 292 Respondent

order made by:	JUDGE TONKIN
DATE OF ORDER:	19 April 2022