Creagh v MPR Pty Ltd
[2018] VSC 763
•14 December 2018
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S CI 2017 04249
| JANINE CREAGH | Appellant |
| v | |
| MPR PTY LTD | Respondent |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 23 August 2018 |
DATE OF JUDGMENT: | 14 December 2018 |
CASE MAY BE CITED AS: | Creagh v MPR Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2018] VSC 763 |
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JUDICIAL REVIEW AND APPEALS – Appeal under s 109 of the Magistrates’ Court Act 1989 (Vic) by an employee against an employer regarding the calculation of actual earnings for the purpose of calculating weekly payments under s 155 and s 156 of the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) (‘WIRC Act’) – Contract of employment between the appellant and the respondent provided for the appellant to be paid a base salary and a motor vehicle allowance – Whether magistrate erred in finding that the motor vehicle allowance fell within the definition of ‘monetary allowances’ in s 156(b)(c) of the WIRC Act – Natural and ordinary meaning used – Mutual Acceptance Co Ltd v Federal Commissioner of Taxation (1955) 69 CLR 389, referred to - No error of law established – S v Crimes Compensation Tribunal [1998] 1 VR 83, referred to – Adequacy of reasons – Magistrate’s reasoning process exposed by a review of the transcript – Appeal dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr A D B Ingram with Mr N F Campbell | John McCristal Injury Lawyers |
| For the Respondent | Mr J P Gorton QC with Mr M J Hooper | Hall & Wilcox |
HER HONOUR:
Introduction and summary of findings
The appellant, Ms Creagh, was an account manager with the respondent, MPR Pty Ltd. The respondent is a distributor of childrens’ toys. The appellant commenced employment with the respondent on 1 July 2015, having been employed by a previous owner of the business from about January 2014. The contract of employment between the appellant and the respondent (‘contract’) provided for, among other things, the appellant to be paid a base salary of $60,000.00 per annum, and a motor vehicle allowance of $13,500.00 per annum. The appellant was required to use her own vehicle for the purposes of her employment, and did so.
On 24 September 2015, the appellant lodged a claim for weekly payments under the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) (‘WIRC Act’) with respect to an injury. The respondent (or its claims agent) accepted the claim, and advised the appellant that, for the purpose of the calculation of her weekly payments, the appellant’s pre‑injury average weekly earnings (’PAWE’) were $1,413.00 per week. Less than a week later, the claims agent notified the appellant that her PAWE had been recalculated at $1,154.00 per week. The reduction represented the effect of the exclusion of the motor vehicle allowance from the appellant’s earnings.
The appellant issued a proceeding in the Magistrates’ Court at Melbourne seeking, in effect, to reinstate the inclusion of the motor vehicle allowance for the purposes of calculating PAWE and the appellant’s weekly payments. The proceeding was heard by Magistrate Smith on 25 September 2017. His Honour heard argument and determined the proceeding on that day, finding that the motor vehicle allowance was a ‘monetary allowance’ within the meaning of s 156 of the Act, and as such, was not to be taken into account in the calculation of weekly payments.
The appellant subsequently appealed to this Court under s 109 of the Magistrates’ Court Act 1989 (Vic) (‘Magistrates’ Court Act‘). Section 109(1) provides as follows:
A party to a civil proceeding in the Court may appeal to the Supreme Court, on a question of law, from a final order of the Court in that proceeding.
For the reasons which follow, the appeal will be dismissed, as no error of law has been established. In particular, the appellant seeks to impeach the factual findings of the learned magistrate, which is not permissible unless the factual finding can be established to be unreasonable or was not open to him to make on the evidence. There has been no misconstruction of the relevant provisions of the WIRC Act on the part of the learned Magistrate. Further, while the question of whether the learned Magistrate’s reasons were adequate is a question which might reasonably be raised, in all of the circumstances, the path of the learned Magistrate’s reasoning is adequately exposed by a review of the transcript of the hearing.
The statutory framework
A worker’s entitlement to compensation, at least for the purposes of the present proceeding, arises out of ss 160 and 161 of the WIRC Act. Section 161 provides that a qualifying worker has an entitlement to weekly payments of compensation at the rate of 95 per cent of PAWE. Section 153 of the WIRC Act defines PAWE as ‘the average of the worker’s ordinary earnings during the relevant period’.
Section 155(1) of the WIRC Act provides, relevantly, as follows:
Definition applying to pre-injury average weekly earnings—ordinary earnings
(1)Subject to this section, in relation to pre-injury average weekly earnings, the ordinary earnings of a worker in relation to a week during the relevant period are—
(a)if the worker's base rate of pay is calculated on the basis of ordinary hours worked, the sum of—
(i)the worker's earnings calculated at that rate for ordinary hours in that week during which the worker worked or was on paid leave at the base rate of pay; and
(ii)if the worker receives a piece rate payment or a commission or both a piece rate payment and a commission, the amount of piece rate payments and commissions the worker receives in respect of that week; or
(b)if paragraph (a) does not apply, the actual earnings (other than an amount of a kind referred to in section 156(1)(a), (b), (c), (e) or (f)) paid or payable to the worker in respect of that week—
and include—
(c)any other amount (other than an amount of a kind referred to in section 156(1)(a), (b), (c), (e) or (f)) for the performance of work by the worker, that, under the worker's terms of employment, the employer is required to apply or deal with on behalf of the worker in accordance with the worker's instructions, in respect of that week; and
(d) the monetary value of—
(i) residential accommodation; and
(ii) use of a motor vehicle; and
(iii) health insurance; and
(iv) education fees—
provided in respect of that week by the employer for the performance of work by the worker.
Section 156(1) of the WIRC Act provides as follows:
Definition applying to pre-injury average weekly earnings and current weekly earnings—base rate of pay
(1)In relation to pre-injury average weekly earnings and current weekly earnings, a reference to a base rate of pay is a reference to the rate of pay payable to a worker for his or her ordinary hours of work (including any casual loadings) but does not include the following—
(a) incentive-based payments or bonuses;
(b) loadings (excluding any casual loadings);
(c) monetary allowances;
(d) piece rates or commissions;
(e) overtime or shift allowances;
(f)any separately identifiable amount not referred to in paragraphs (a) to (e).
Given that the appellant received a fixed annual salary, plus a motor vehicle allowance, s 155(1)(b) applies to the calculation of the appellant’s PAWE. The issue before the learned Magistrate, and this Court, is whether the amount of $13,500 paid to the appellant and described as a ‘motor vehicle allowance’ was a monetary allowance within the meaning of s 156(1)(c) of the WIRC Act.
The hearing at the Magistrates’ Court
The matter came before the learned Magistrate on 25 September 2017, with the parties having filed brief pleadings. In her statement of claim, the appellant sought a declaration that she was entitled to weekly payments of $1,413 per week, backdated to 17 September 2015. The respondent’s defence stated that the appellant’s PAWE had been calculated in accordance with s 153(1) and (6) of the WIRC Act.
While there was no evidence before me as to how long the proceeding took to hear, I can infer from the length of the transcript that the hearing took place over at least two hours. No written submissions were filed, and no written reasons or formal ex tempore ruling was delivered by the learned Magistrate. Some documents (the contract, and the appellant’s tax returns) were handed up to his Honour, but not formally tendered into evidence. The hearing was conducted relatively informally, there being a great deal of interaction between the learned Magistrate and counsel about the construction of ss 155 and 156 of the WIRC Act, and whether the motor vehicle allowance was a monetary allowance within the meaning of s 156 of the WIRC Act. His Honour concluded that it was, stating at the conclusion of the hearing: ‘Yes, it’s an allowance.’[1]
[1]Transcript (exhibit ‘JSC-1’ to the affidavit of Jessica Cheo sworn 29 November 2017) (‘T’) page 70, line 26.
The Notice of Appeal
The appellant’s Notice of Appeal filed on 23 October 2017 identified the following questions of law:
1.Whether the Honourable Magistrate misconstrued the meaning of the term ‘monetary allowances’ contained in section 156(1)(c) of the Workplace Injury Rehabilitation and Compensation Act 2013.
2.Whether the Appellant’s motor vehicle allowance paid under the Appellant’s contract of employment was a type of payment within the meaning of the term ‘monetary allowances’ contained in section 156(1)(c) of the Workplace Injury Rehabilitation and Compensation Act 2013.
3.Whether the Appellant’s pre-injury average weekly earnings for the purpose of the calculation of her weekly payments of compensation under the Workplace Injury Rehabilitation and Compensation Act 2013 should be calculated to include an amount received by the Appellant as a motor vehicle allowance pursuant to the terms of the Appellant’s contract of employment.
4.Whether the Honourable Magistrate failed to provide reasons of adequate reasons for his decision or demonstrate an adequate reasoning process in dismissing the proceeding.
The grounds of appeal largely mirrored the questions of law referred to above, as follows:
1.The Honourable Magistrate erred in law in misconstruing the meaning of the term ‘monetary allowance’ contained in section 156(1)(c) of the Workplace Injury Rehabilitation and Compensation Act 2013.
2.The Honourable Magistrate erred in finding that the Appellant’s motor vehicle allowance paid under the Appellant’s contract of employment was a type of payment within the meaning of the term ‘monetary allowances’ contained in section 156(1)(c) of the Workplace Injury Rehabilitation and Compensation Act 2013.
3.The Honourable Magistrate erred in finding that the Appellant’s pre‑injury average weekly earnings for the purpose of the calculation of the Appellant’s weekly payments of compensation under the Workplace Injury Rehabilitation and Compensation Act 2013 should be calculated without the inclusion of an amount received by the Appellant as a motor vehicle allowance pursuant to the terms of the Appellant’s contract of employment.
4.The Honourable Magistrate erred in failing to provide reasons or adequate reasons for his decision or demonstrate an adequate reasoning process in dismissing the proceeding.
The appellant seeks the following relief:
1. The decision and orders of the Honourable Magistrate be set aside.
2.The Court substitute its own decision for that of the Honourable Magistrate.
3.In the alternative the Court remit the matter to the Magistrates’ Court for re‑hearing before a different Magistrate.
4.The Respondent pay the costs of this Appeal.
5.Such other orders as are appropriate in the circumstances.
At the hearing of the appeal, the first to third questions of law were in effect conflated into a single question, being whether the learned magistrate had erred in finding that the motor vehicle allowance fell within the definition of ‘monetary allowances’ contained in s 156(1)(c) of the Act.
The following materials were in evidence before me at the hearing of the appeal:
(a) an affidavit of the solicitor for the appellant sworn on 20 October 2017, which exhibited the pleadings in the Magistrates’ Court proceeding, the orders made by the learned Magistrate on 25 September 2017, a transcript of the hearing on that day, the contract, and the appellant’s tax returns for the 2014/2015 and 2015/2016 financial years;
(b) an affidavit of the solicitor for the respondent, sworn on 29 November 2017, which exhibited a better quality transcript of the hearing below; and
(c) an affidavit of a solicitor for the appellant exhibiting the schedule to the contract, a contract between the appellant and the former owner of the business dated 29 November 2013 (‘earlier employment contract’), and a ‘transition of employment’ letter dated 2 June 2015.
There is considerable doubt as to whether the earlier employment contract was before the learned Magistrate. Nevertheless, I permitted counsel for the appellant to make submissions by reference to the earlier employment contract, in addition to the contract and the tax returns.
Submissions
Appellant’s submissions
The appellant’s written outline of submissions were substantially similar to the submissions advanced on behalf of the appellant below. The appellant submitted that the construction of the expression ‘monetary allowance’ contended for by the respondent, and adopted by the learned Magistrate, was too wide, as it would exclude from the ordinary earnings of a worker any payment which was labelled as an allowance. The appellant submitted that where two constructions of a particular provision are available, the Court should adopt the construction most favourable to the worker.[2]
[2]See Dodd v Executive Air Services [1975] VR 668.
The appellant submitted that other parts of ss 155 and 156 support a narrow reading of s 156(1)(c). It is not necessary to traverse these submissions in any detail, or at all, as during the course of the hearing, counsel for the appellant conceded that the phrase ‘monetary allowance’ ought to be given its natural and ordinary meaning, rendering a substantial part of the appellant’s written submissions largely redundant for the purpose of this appeal. However, I did not understand the appellant to be resiling from the following submission:
… the term ‘monetary allowances’ should not be given a meaning that would cause it to apply to any payment which has been labelled as an ‘allowance’. Consistent with the overall purpose of subsection 156(1), the term ‘monetary allowance’ should be interpreted to exclude from the base rate of pay any additional amounts in excess of the worker’s core or essential earnings or the essential elements of a worker’s salary package for the ordinary hours of work. However payments are labelled, amounts which are paid as part of a worker’s core or essential earnings or the essential elements of a worker’s salary package for their ordinary hours of work, should be included in the worker’s ‘ordinary earnings’.
The appellant referred to the terms of the contract, and submitted that the appellant’s salary package was made up of a base salary of $60,000 and the motor vehicle allowance, stating as follows:
The motor vehicle allowance was not an additional or extra payment, it was merely a description of an item in a salary package. It was not paid for any extenuating circumstances or due to some qualification. It was paid for the Appellant to undertake her usual duties in her usual hours of work. The salary package is the reward for all the [appellant’s] usual hours of work.
The appellant submitted that the combined base salary and motor vehicle allowance is the core remuneration of the plaintiff, and that the motor vehicle allowance was not an additional payment. As such, the motor vehicle allowance paid to the appellant was not a ‘monetary allowance’ within the meaning of s 156(1) of the WIRC Act.
The appellant submitted that upon review of the terms of the contract, as well as the earlier employment agreement, one can see the context in which the payments were made. Counsel for the appellant submitted as follows:
The thrust of the case is that what was so-called as a motor vehicle allowance was not an allowance in fact, but it formed part of a substantive package for remuneration. It was not required to be spent on any particular vehicle, and, as the [appellant’s] tax returns show, it was not spent largely with respect to a motor vehicle at all.[3]
[3]Transcript page 3, lines 11-16.
The appellant referred to the tax returns of the appellant which were in evidence, which showed that an amount which was only part of the allowance was claimed as motor vehicle expenses, along with a number of clauses of the contract, in support of her contention that the motor vehicle allowance was part of the appellant’s core remuneration package, and was not referrable to her use of a motor vehicle.
Counsel for the appellant noted that clause 6.5 of the contract refers to ‘remuneration’ as being $60,000 plus $13,500. The sum of $13,500 is not a discretionary payment made by the employer. Taken together, the two components amount to actual earnings, which were intended to exceed any other lawful entitlements and any relevant industrial award. Counsel for the appellant also noted that clause 8(c) of the earlier employment contract refers to ‘wages’ as including the base salary and motor vehicle allowance. He submitted that none of these matters were considered by the learned Magistrate in reaching his decision.
In respect of the adequacy of the learned Magistrate’s reasons, the appellant submitted that the learned Magistrate was under a duty to provide reasons which
dealt with the substantial points which were raised; refer (sic) to the evidence or material upon which the findings were based and provide an intelligible explanation of the process of reasoning from the evidence to the findings and from the findings to the ultimate conclusion.
The appellant relied upon the decisions of the Court of Appeal in Franklin v Ubaldi Foods Pty Ltd[4] and Transport Accident Commission v Campbell[5] in support of her contention that the learned Magistrate’s reasons were inadequate. The appellant submitted that the reasons provide no guidance to the appellant or the Court as to the substantive reasons as to why the appellant lost the case. It is impermissible on the part of the respondent to simply pluck out lines here and there from the transcript to support a contention that the reasons are adequate. The proceeding should be remitted to the Magistrates’ Court for that reason alone.
[4][2005] VSCA 317, [38].
[5][2015] VSCA 7, [75]-[81].
Respondent’s submissions
In its written outline of submissions, the respondent made the overarching submission that the learned Magistrate was correct in finding, as a matter of fact, that the motor vehicle allowance was a monetary allowance within the meaning of s 156(1) of the WIRC Act. His Honour did not err in law as to the meaning of the phrase ‘monetary allowance’. As an appeal under s 109 of the Magistrates’ Court Act 1989 (Vic) can only be brought on a question of law, the appeal should be dismissed.
Senior counsel for the respondent said it has not been put on the part of the appellant that there is any ambiguity in the legislation or how it is to be interpreted. Rather, the appellant contends that the learned Magistrate reached the wrong factual conclusion. It has not been suggested that the phrase ‘monetary allowance’ should be given anything other than its natural and ordinary meaning. Accordingly, the dispute concerns a question of fact. The respondent referred to the dictionary definition of allowance, as follows:[6]
[6]Macquarie Dictionary, (7th ed, 2017).
2.a definite sum of money allotted or granted to meet expenses or requirements …
3.an addition, as to a wage, etc, on account of some extenuating or qualifying circumstance: a travel allowance.
and further:[7]
3.A limited quantity or sum, especially of money or food, granted to cover expenses or other requirements.
[7]Shorter Oxford English Dictionary (7th ed, 2007).
If it is accepted that the phrase ‘monetary allowance’ is to be given its natural and ordinary meaning, then any finding of the Magistrate as to what constitutes a monetary allowance is a factual finding and no relief is available under s 109 of the Magistrates’ Court Act. Senior counsel for the respondent referred to the decision of the Court of Appeal in S v Crimes Compensation Tribunal[8] regarding the distinction between a question of law and a question of fact.
[8][1998] 1 VR 83.
Senior counsel referred to the decision of W.A. Flick and Co v Federal Commissioner of Taxation,[9] and the decision of the High Court in Mutual Acceptance Co Ltd v Federal Commissioner of Taxation,[10] where Latham CJ stated that an allowance:
… is a grant of something additional to ordinary wages for the purpose of meeting some particular requirement connected with the service rendered by the employee or as compensation for unusual conditions of that service.[11]
[9](1959) 103 CLR 334.
[10](1944) 69 CLR 389.
[11]Ibid, 396-397.
The respondent submitted that the statement above is consistent with the ordinary meaning of the phrase ‘monetary allowance’. The respondent submitted that there is nothing elsewhere in the WIRC Act to otherwise limit or alter the meaning of the phrase ‘monetary allowance’. There is no discernible intention in the WIRC Act that it should be interpreted in any way other than its natural and ordinary meaning.
The respondent submitted as follows:
The $13,500 payment was an amount of money allowed to the appellant because she had to use her own vehicle in her employment. It was accepted by her counsel that she was paid more because she had to use her own vehicle. It was money payable for ‘qualifying circumstance’, namely, the requirement that she provide the motor vehicle … Thus, even on the ordinary meaning proposed by the appellant, it was a monetary allowance. It was a payment made to an employee in respect of an incident of their service, namely her provision of the car for use at work.
The respondent rejected the appellant’s contention that the motor vehicle allowance was part of her core or essential earnings as being contrary to the clear language of s 155(1)(b) and s 156(1) of the WIRC Act. The motor vehicle allowance was not referable to her earnings, or her hours of work, but was referrable to the requirement that the appellant use her own motor vehicle for work purposes. That she did not incur motor vehicle expenses equivalent to the quantum of the allowance does not alter the position: the amount of the motor vehicle allowance is by necessity an estimate. The respondent submitted that there is nothing odd or anomalous about the motor vehicle allowance being excluded for the purpose of calculating PAWE: if the appellant was not working by reason of her injury, she would not be incurring work related expenses.
In relation to the reasons of the learned Magistrate, the respondent accepted that the reasons were concise. The question is whether the reasons were adequate. The only way in which it could be said that the reasons were inadequate was if it was said that the learned Magistrate had not dealt with the complicated question of statutory construction which is no longer being pressed by the appellant.
In the current case, there were no issues of credit. There was no oral evidence. The parties proceeded on agreed facts. The learned Magistrate had to form a factual conclusion about whether or not the motor vehicle allowance was a monetary allowance. It is apparent from the discussions with counsel disclosed by the transcript of the hearing that the learned Magistrate had clearly engaged with the relevant issues.
Accordingly, the respondent submitted that the reasons were adequate, given the nature of the dispute and the narrow focus of the issue before the learned Magistrate. The respondent submitted that the following reasoning process emerges from a review of the transcript:
(a)The case was about the appellant’s ‘actual earnings’ for the purpose of s 155(1)(b), not her ‘base rate of pay’ for the purpose of s 155(1)(a). Section 156 deals with the worker’s ‘base rate of pay’. The two sections ‘operate quite independently’. And so the meaning of ‘monetary allowance’ was not to be distorted by reason of any interplay between the two sections; and
(b)The payment was an allowance within the meaning of the word set out above.
The respondent submitted that, even if this Court was to find that the reasons were inadequate, the matter should not be remitted for a further hearing, as this Court is in just as good a position as the court below to determine the question of whether the motor vehicle allowance was a monetary allowance within the meaning of s 156(1)(c) of the WIRC Act.
Appellant’s submissions in reply
The appellant’s written outline of submissions in reply stated as follows:
… the Appellant does rely upon the ordinary and natural meaning of the term ‘monetary allowance’. The ordinary and natural meaning of ‘monetary allowance’ is a financial benefit given to an employee by an employer over and above the regular payments for the ordinary obligations under the contract of employment. In this case, the vehicle allowance was not over and above the Appellant’s regular payments for the ordinary obligations under the contract of employment and was therefore not a monetary allowance.
Counsel for the appellant submitted that the authorities relied upon by the respondent do not address the factual circumstances in the current case and, in any event, concern different legislative schemes. Counsel for the appellant said that he did not quibble with the phrase ‘monetary allowance’ being given its natural and ordinary meaning. However, the motor vehicle allowance was an amount paid as part of a single salary package. In effect, the learned Magistrate misconstrued the terms of the contract.
Counsel for the appellant submitted that the question of whether in calculating the appellant’s actual earnings, the motor vehicle allowance, which is enumerated as an allowance, was in fact part of the appellant’s total remuneration package, was not determined as a fact. Accordingly, the learned Magistrate misconstrued the relevant provisions of the WIRC Act, which is an error of law.
Counsel for the appellant submitted that the appellant was entitled to another trial: the learned Magistrate has failed to explain why one argument was preferred over another.
Conclusions and reasons
In relation to the substantive issue on this appeal, I agree that there has been no error of law on the part of the learned Magistrate. The phrase ‘monetary allowance’ should be given its natural and ordinary meaning. As noted in S v Crimes Compensation Tribunal,[12] Phillips JA made the following distinctions between questions of law and questions of fact, which has been adopted widely in this jurisdiction.[13]
[12][1998] 1 VR 83.
[13]Ibid, 88-82.
(a) what is the proper meaning, as a matter of construction, of the statutory description which is relevant to the claimant’s success or failure is a question of law;
(b) once the task of construction is over, the question of whether the claimant’s particular circumstances fall within the relevant statutory description is essentially a question of fact; and
(c) nevertheless if, in determining whether the particular circumstances of the claimant are such as to fall within the relevant statutory description, the fact finding tribunal arrives at a conclusion that was not open to it, that is an error of law, and the question of whether it arrived at a conclusion which was not open to it is a question of law.
The proposition at (b) above is not universally endorsed. The High Court has held that very often the question of whether facts as found answer a statutory description will be a question of law.[14]
[14]See Hope v Bathurst CC (1980) 144 CLR 1, 7; Vetter v Lake Macquarie CC (2001) 202 CLR 439, [24].
As noted by Nettle JA in R v ACR Roofing Pty Ltd:[15]
But in reality there are few cases where the question of whether facts as found come within a statutory provision is purely a question of fact. As Mason J said in Hope v Bathurst CC many authorities can be found to sustain the proposition that whether the facts fully found fall within the provisions of a statutory enactment, property construed is a question of fact. It is in effect only in cases of statutes which involve very simple words permitting of only one ordinary meaning that the problem is purely factual.[16] (emphasis added)
[15](2004) 11 VR 187.
[16]Ibid, [42].
Similarly, in Central Bayside Division of General Practice Ltd v Commissioner of State Revenue,[17] Nettle J stated:
When a statute uses words according to their ordinary meaning and it is reasonably open to hold that the facts of the case fall within those words, the question of whether they do or do not is ordinarily a question of fact. That is the sort of question with which Phillips JA was concerned in S v Crimes Compensation Tribunal and, with respect, that is why his Honour described the question as he did. But it is different when a statutory description is in terms that are not used in their ordinary meaning.[18]
[17][2003] VSC 285.
[18]Ibid, [5].
In my view, the current case involves very simple words which are to be given their natural and ordinary meaning. Accordingly, the question of whether the motor vehicle allowance was a monetary allowance is a question of fact.
In any event, even if the question of whether the motor vehicle allowance was a monetary allowance within the meaning of s 156 of the WIRC Act was not purely a question of fact, but a mixed question of law and fact, the authorities relied upon by the respondent support the view that the motor vehicle allowance is a monetary allowance. That those authorities concern different legislative schemes does not particularly detract from their relevance to the current appeal in the absence of any provision or discernible legislative intention in the WIRC Act to support any alternative construction of the phrase. In Mutual Acceptance Co Ltd v Federal Commissioner of Taxation,[19] in addition to the statement made by Latham CJ extracted at paragraph 30 above, another member of the majority, Williams J, elaborated further, as follows:
In the present case the appellant is liable to make three classes of payments to its travellers under their contracts of employment, namely, (1) wages, (2) commissioner, and (3) sums called car allowances in respect of the use by them of their own motor cars. The amounts payable to employees under contracts of employment may vary indefinitely and be sub-divided into various classes. Employees may receive a certain wage, and be left, out of that wage, to bear all the expenses such as clothing, travelling, and board and lodging that are involved directly or indirectly in placing themselves in a position to earn it, or they may be paid a certain wage and in addition receive other recompense in cash or in kind expressly or impliedly to cover all or certain of their expenses, direct or indirect. These additional payments would all be properly described as allowances in the ordinary and natural grammatical meaning of that word. In order to do their work it is necessary for the travellers to use cars. This is an expense to which they are put in the course of their employment. If the appellant did not make the car allowances it would either have to provide cars for the travellers or increase their wages or commission.[20]
[19](1944) 69 CLR 389.
[20]Ibid, 405.
The decision in Mutual Acceptance Co Ltd v Federal Commissioner of Taxation,[21] was followed by the High Court in W.A. Flick & Co Pty Ltd v Federal Commissioner of Taxation,[22] where the High Court held that:
… a fixed amount agreed between the company and each traveller as representing an arbitrary and rough and ready assessment of two-thirds of the expenditure estimated as likely to be incurred by the traveller in using his motor car, were allowances paid to employees as such … [23]
[21]Ibid.
[22]Ibid.
[23]Ibid, 339.
The appellant relied upon the decision of the Court of Appeal in Paterson v Stanmoor Pty Ltd and Anor,[24] albeit acknowledging that this decision concerned a somewhat different legislative framework. In my view, the difference is material. In this decision, the Court of Appeal held that the value of non‑pecuniary benefits such as board and food should be taken into account when calculating weekly payments under the Accident Compensation Act 1985 (Vic). This entitlement is now enshrined in s 155(1)(d) of the WIRC Act, with the value of any non‑pecuniary benefit (which may include the use of a motor vehicle) to be calculated according to s 155(2) of the WIRC Act. The existence of s 155(1)(d) was advanced by the appellant as a relevant matter below, in that the incorporation of the value of non‑pecuniary benefits in actual earnings was said to be inconsistent with the exclusion of a motor vehicle allowance under s 156 of the WIRC Act, but this submission was not pressed at the hearing of the appeal. In any event, as noted by counsel appearing for the respondent below, the terms of s 156 of the WIRC Act were included in its predecessor legislation after the decision in Paterson v Stanmoor Pty Ltd and Anor,[25] and expressly limit the entitlements of workers to weekly payments in respect of certain categories of remuneration. I agree.
[24](2000) 2 VR 460.
[25]Ibid.
The appellant relied upon a number of clauses within the contract (and the earlier employment contract) to support her contention that the motor vehicle allowance was not a monetary allowance within the meaning of s 156(1)(c) of the WIRC Act. With respect, these clauses do not assist in resolving the issue on this appeal. Indeed, the terms of the contract also supports the contrary proposition. For example, clause 16.1 of the contract, under the heading ‘Accident and Make-Up Pay’, provides as follows:
If you become entitled to weekly compensation payments in accordance with State accident compensation legislation, you will be paid an amount equivalent to the difference between the level of weekly compensation and your Base Salary.
The schedule to the contract provides that the appellant’s base salary is $60,000. The contract presumes that the amount of weekly payments will fall short of the base salary. However, if the motor vehicle allowance was used to calculate the appellant’s PAWE, her weekly payments would exceed her base salary. While this is of course not determinative, I do not accept the appellant’s submission that the proper construction of the contract leads to an inevitable conclusion that the motor vehicle allowance forms part of the appellant’s actual earnings, rather than being a separate monetary allowance within the meaning of s 156 of the WIRC Act.
In any event, while the terms of the contract may be relevant to the correctness of the finding of the learned Magistrate that the motor vehicle allowance was a monetary allowance: they do not alter the character of the finding that the learned Magistrate made, being a factual finding. Further, the terms of the contract provide no assistance to the task of statutory construction, which, given the concession properly made by counsel for the appellant, was a very simple task. Once it is accepted that the phrase ‘monetary allowances’ bears its natural and ordinary meaning, the task of statutory construction is at an end. However, in any event, the construction of a private document such as the contract cannot lend any aid whatsoever to the task of statutory construction.
Accordingly, the first to third grounds in the Notice of Appeal are not made out.
As for the question of whether the learned Magistrate provided adequate reasons, it is perhaps unfortunate that his Honour did not take the time to provide what would have been brief and simple ex tempore reasons. However, I agree with the submissions of the respondent that his Honour’s reasoning process is discernible from the transcript.
While it is not necessary for present purposes to go into any great detail regarding what transpired during the course of the hearing, I would make the following observations regarding what led up to the learned Magistrate reaching his conclusion that the motor vehicle allowance was a monetary allowance:
(a) his Honour was immediately informed that there was a single issue which needed to be determined, and it soon became apparent there was no dispute about the relevant facts;
(b) at first, his Honour appeared to be attracted to the submissions of the appellant that the motor vehicle allowance was part of the appellant’s actual earnings;
(c) however, as the hearing continued, and there was further discussion between his Honour and both counsel regarding the terms of ss 155 and 156 of the WIRC Act, the learned Magistrate rejected the contention that the terms of s 155(1)(d) (which provides that the monetary value of non‑pecuniary benefits are included in the ordinary earnings of a worker for the purpose of calculating PAWE) were relevant to the determination of whether the motor vehicle allowance was part of the appellant’s ordinary earnings;
(d) prior to the luncheon adjournment, his Honour signalled quite clearly to counsel for the appellant that he was inclined to agree with the respondent’s contention that the motor vehicle allowance fell within the terms of s 156(1)(c), but that he remained open to persuasion to the contrary; and
(e) after further discussion with counsel, he rejected the appellant’s contention that there was any tension between ss 155 and 156 of the WIRC Act, and reached the conclusion that the motor vehicle allowance was a monetary allowance. His Honour’s conclusion that ‘Yes, it’s an allowance’ was prefaced by the following:[26]
[26]T 70, page 3-26.
HIS HONOUR:
Yes. So he says, ‘Look, forget 155(1)C, it’s simply repeating itself within s 155 because B itself picks up the exceptions to what actual earnings are. Actual earnings can’t occur in things occurring in 156(1). This, he says, is an allowance as a matter of fact. Plainly it’s covered by the exception in 155(1)B. Why should it not? That’s what both parties called it.
MR CAMPBELL:
Well, I’d just be repeating what I’ve said, I’m not sure I can take it any further than the submissions I’ve made about - - -
HIS HONOUR:
No-one denies that’s what she got but that’s not the point here. It’s what she can use of what she got and it says you can’t use anything which is characterised as an allowance.
MR CAMPBELL:
And we say that - - -
HIS HONOUR:
And no matter how ambiguous and horribly worded this part of the legislation is, again, there’s no dispute about that, the basic principle is clear. This is what you can take into account for actual earnings. This is what you can’t. whichever way it points it out, my friend says, that’s what it points out.
MR CAMPBELL:
We’ve put our decisions about the meaning of allowance and about the meaning (indistinct).
HIS HONOUR:
Yes, it’s an allowance.
As previously noted, this was a hearing where the learned Magistrate took an active part in the process. The learned Magistrate did not preside over the hearing in a sphinx‑like manner: he actively engaged with both counsel about the issue before him. The transcript reveals the reasoning process, and I have no difficulty in understanding why he reached the decision that he did: he was not satisfied that the motor vehicle allowance was somehow excluded from the express carve out contained in s 156(1) of the WIRC Act. This ground of appeal fails.
In any event, if I am wrong, and the reasons are inadequate, I agree that I have the power to determine the matter afresh, and I should exercise that power to do so. Section 109(6) of the Magistrates’ Court Act 1989 (Vic) provides that:
After hearing and determining the appeal, the Supreme Court may make such order as it thinks appropriate, including an order remitting the case for rehearing to the Court with or without any direction in law.
Given my findings above, if I had held the reasons were inadequate, there are no features of the current case which would render it inappropriate for determination on the material before me. All of the evidence which was before the court below is before me. Unlike the court below, I have had the benefit of the parties’ comprehensive written submissions. And, as noted above, even if the learned Magistrate’s substantive decision was reviewable under s 109 of the Magistrates’ Court Act 1989 (Vic), I would have reached the same conclusion: that is, that the motor vehicle allowance was a monetary allowance within the meaning of s 156(1)(c) of the WIRC Act.
In those circumstances, it would be productive of unnecessary cost and expense to remit the matter back to the Magistrates’ Court. The obligations of the Court under the Civil Procedure Act 2010 (Vic) (‘CPA’) apply with equal force to the disposition of appeals as to the management and finalisation of trial hearings at first instance.[27] Section 7(1) of the CPA provides that the overarching purpose of the CPA is to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute. Section 7(2)(a) of the CPA provides that the overarching purpose may be achieved by the determination of the proceeding by the court, and s 8 of the CPA provides that a court must seek to give effect to the overarching purpose in the exercise of any of its powers. In the current case, to require the parties to incur the additional cost and expense of a further hearing because of deficiencies in the reasons, when this Court is well placed to reach its own conclusion, would not further the overarching purpose of the CPA.
[27]The much cited decision of the Court of Appeal in Yara Australia Pty Ltd v Oswal (2013) 41 VR 302 concerned the conduct of an appeal.
Accordingly, I will dismiss the appeal.
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