Djuric v Kia Ceilings Pty Ltd
[2010] NSWWCCPD 20
•3 March 2010
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| STATUS: Decision confirmed on appeal: Djuric v Kia Ceilings Pty Ltd [2011] NSWCA 34 | ||||||
| CITATION: | Djuric v Kia Ceilings Pty Ltd [2010] NSWWCCPD 20 | |||||
| APPELLANT: | Mile Djuric | |||||
| RESPONDENT: | Kia Ceilings Pty Ltd | |||||
| INSURER: | Allianz Australia Workers’ Compensation (NSW) Limited | |||||
| FILE NUMBER: | A1-4391/09 | |||||
| ARBITRATOR: | Ms C Rimmer | |||||
| DATE OF ARBITRATOR’S DECISION: | 21 September 2009 | |||||
| DATE OF APPEAL HEARING: | 28 January 2010 | |||||
| DATE OF APPEAL DECISION: | 3 March 2010 | |||||
| SUBJECT MATTER OF DECISION: | Deemed worker; Schedule 1 clause 2 of the Workplace Injury Management and WorkersCompensation Act 1998 | |||||
| PRESIDENTIAL MEMBER: | Acting Deputy President Anthony Candy | |||||
| HEARING: | Oral | |||||
| REPRESENTATION: | Appellant: | Mr D Baran instructed by NSW Compensation Lawyers | ||||
| Respondent: | Mr P Rickard instructed by Goldbergs Lawyers | |||||
| ORDERS MADE ON APPEAL: | The decision of the Arbitrator dated 21 September 2009 is confirmed. | |||||
| COSTS: | Each party is to pay his or its own costs of the appeal. | |||||
BACKGROUND TO THE APPEAL
Mile Djuric (‘the appellant’) had worked installing wall lining materials for a number of years. This work is described as gyprocking although not limited to materials of this particular brand. He and others had contracted with Kia Ceilings Pty Ltd (‘Kia’) to do such work at Bathurst Hospital in early 2007. He began to feel pain in his back about two weeks after commencing this work on 26 April 2007 but he continued to work until 9 July 2007. He has not resumed any form of work since.
After ceasing work the appellant consulted a general practitioner, Dr Hanna, who referred him to an orthopaedic specialist, Dr Maniam. Both doctors have recorded the date of injury as 20 March 2007, based, no doubt, on the appellant’s recollection of events. Dr McKechnie, a neurosurgeon, performed a lumbar laminectomy and fusion on 7 August 2009.
On 10 August 2007 the appellant made a claim for workers compensation against Kia which was referred to its insurer, Allianz Australia Workers’ Compensation (NSW) Limited (‘the insurer’).The insurer denied liability to pay compensation on a number of grounds which included a denial that the appellant was a worker or deemed worker under the provisions of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
Accordingly, the appellant brought proceedings, matter number 2001/09, in the Workers Compensation Commission (‘the Commission’) seeking weekly compensation and treatment expenses. These were discontinued on 21 April 2009 for want of sufficient documentary evidence.
The current proceedings were commenced on 9 June 2009 and were referred to a Commission Arbitrator for determination. An arbitration was conducted on 4 September 2009 at which it was conceded on behalf of the appellant that he was not a worker within the definitions in the Workers Compensation Act 1987 (‘the 1987 Act’) and the 1998 Act but it was submitted he was a deemed worker pursuant to Schedule 1 clause 2 of the latter Act. In due course it will be necessary to consider what other concessions were made on behalf of the appellant. The Arbitrator reserved her decision which was given in a Certificate of Determination dated 21 September 2009 to which a statement of reasons was attached. That certificate is as follows:
“1. Award for the Respondent in respect of the Applicant’s claim for weekly compensation
2. Award for the Respondent in respect of the Applicant’s claim for section 60 expenses.
3. I certify this matter as complex.
4. I certify an uplift of the Respondent’s costs of 20%.
5. No order as to costs.”
ISSUES IN DISPUTE
The issues in dispute in the appeal are whether the Arbitrator:
(a) erred in failing to find that the contractor was a deemed worker, and
(b) provided proper and adequate reasons for finding that the contractor was not a deemed worker.
ON THE PAPERS REVIEW
The appellant sought an oral hearing on the basis that a great deal of argument would need to be advanced in support of the grounds of appeal. Kia was content for the appeal to be determined on the papers but it had not however responded in any real way to the arguments advanced on the appeal by the appellant. In my view the issues were such that an oral hearing was required and, accordingly, this was set down for 28 January 2010 at which the parties were represented by counsel.
LEAVE
Kia does not dispute the appeal was filed within time, nor that the monetary thresholds prescribed by section 352(2) of the 1998 Act are met. It appears to me that the amount of compensation at issue is sufficient to satisfy the sub-section.
Accordingly, leave to appeal is granted.
EVIDENCE
Appellant’s Evidence
It is not necessary in my view to deal with the medical evidence since there appears to be no relevant medical issue in this appeal.
There are no fewer than five statements of the appellant in evidence. To some extent they repeat the same information and I will only set out new matters contained in later statements. It is convenient to deal with them in chronological order although the earliest of these was relied on by Kia and not the appellant. This was obtained on 19 December 2007 and 11 February 2008. It is not clear why the taking of this statement extended over two separate days almost two months apart. The appellant said he migrated to Australia on 11 February 2000. He had worked as a gyprocker on a sub-contracting basis for various companies on building sites from 2 March 2001 to 30 May 2001. He was then on sickness benefits until 7 March 2003 because of gallbladder problems. From 8 March 2003 to 25 April 2007 he worked as a gyprocker on a sub-contracting basis for various companies before commencing work at the Bathurst Hospital site.
He had injured his back while working at the site of the new hospital in Bathurst because he was required to carry heavy villaboard from one level to another for about 20 days before a crane was employed to do this. He had his own Australian Business Number and identified the owner of Kia as Mr Dusko Panic. He was earning $1,000.00 gross per week working 7 a.m. to 5 p.m. Monday to Friday and some Saturdays. He did not have workers compensation insurance and was working with another sub-contractor, Mr Bogdan Djukic.
This statement was obtained by a person identified as Vesna Janjic who apparently acted as an interpreter since the appellant spoke Serbian and not English.
The second statement is dated 23 January 2009. In this statement he said he was paid at a rate of $5.00 per square metre which he said equated to approximately $2,000.00 or $1,500.00 nett per week. He said he would invoice Kia at the end of each week and was paid by cheque each fortnight. Kia provided hotel accommodation in Bathurst and six workers or contractors including Mr Panic resided together. He said that he worked 10 hours each day 7 am to 5 pm but finished at 2 pm Fridays in order to return to Sydney for the weekend. He could have asked someone else to assist him in the work but if he did he would have to have paid that person out of what he termed were his “wages” which he did not think was worthwhile.
The third statement was obtained on 5 March 2009. He referred to invoices which he gave to Kia for the period 2 March 2006 up until 4 October 2006. Following that time he said he worked for Simco Ceilings from 16 November 2006 to 24 April 2007. During the time he was working for Kia he worked for it exclusively and he was not employed by anyone else. He had his own tools but would also use tools, ladders and scaffolding provided by Kia. He did not employ any other person to work for him and worked exclusively for Kia as an employee.
A fourth statement dated 7 May 2009 related how he began working as a gyprocker. About a year after he arrived in Australia he began working with friends and neighbours and gradually learned the trade and skills required. Then he said he was mainly working at an hourly rate for different employers and generally worked six days a week eight hours a day. He would, however, provide a written invoice for the number of hours worked and the person would then pay him every two weeks for those hours. He would pay his own tax and had obtained an Australian Business Number (ABN) for that purpose very soon after he started working in the gyprock trade. He distinguished between jobs in which he was paid per square metre of gyprock laid or fitted which he called “contract jobs” and other jobs in which he was paid by the hour. He had two contract jobs, the second being that for Kia at Bathurst Hospital. When working on a contract basis it was up to him what hours he worked and when he turned up to do the work. He did however say that he had been working pretty much the same as when he had been working as for an hourly rate but he did work more hours per day in order to get more work done and thus earn more money. When working on a contract basis he said there was no real difference in the tools which he provided and he enumerated the various tools provided by Kia at the Bathurst Hospital site.
So far as obtaining the work at the Bathurst Hospital, he said that he had discussions with Mr Panic for whom he had done a lot of gyprock work at an hourly rate. Mr Panic told him that he was looking for workers who were prepared to work out of Sydney and the appellant expressed an interest. He initially agreed to work on an hourly rate but after one day of working on this basis he changed the arrangements in order to be paid on a contract basis for the amount of gyprock or villaboard installed. He did not advertise himself as being available to work for anyone else from April to July 2007 and had not previously advertised. He and Mr Panic would travel together sometimes in his car and sometimes in Mr Panic’s. He was shown what to do by Mr Panic who was on site every day and also by a foreman from Melvin Constructions. It was quite usual for Mr Panic to inspect the work being done and on occasions he was asked to re-do certain work which he had performed. On the Bathurst job he said he was wearing shirts, jackets and hats which had been given to him by Mr Panic which he thought had in turn been supplied by Melvin Constructions which was the name appearing on the jackets. He had no work clothing bearing his own name.
The appellant then explained how he initially completed a workers compensation claim form in which he nominated 26 March 2007 as the date of injury. (The figure 6 has been written over some other number.) He said he was confused and he had only worked at Bathurst Hospital from 26 April 2007. When he became aware that the earlier claim form had the incorrect period of work at the hospital, he amended that claim to include the correct dates and supplied that to the insurer.
The last statement of the appellant is dated 31 August 2009. In that statement he addressed the terms of Schedule 1 clause 2. He said that the contract he had with Kia was to perform work exceeding $10 in value; the work that he was doing there was[sic] incidental to his trade as a gyprock fixer which business he carried out as a sole trader; he did not operate under a business name or as a corporate identity; he did not sublet the contract or employ anyone to assist him; he did not advertise in newspapers or otherwise as being available to work; and he obtained all of his work by word of mouth and recommendations from earlier satisfied builders. He said he did not purchase or supply the gyprock sheets or any material required to fit it – this was done by the builder or the principal contractor. He understood that at Bathurst Hospital this had been done by Kia. He said he was not directly supervised in the sense that he was told how to carry out or perform his work but if the work was not done on time or to a particular standard then something was said to him about this. He said he regularly started work early and finished later than other employees or trades on site. It was up to Mr Panic to show him what work had to be done and how it was to be finished.
Copies of a number of invoices from the appellant to Kia which cover two separate periods were initially relied on. The earlier period is from 2 March 2006 to 4 October 2006. There are 16 invoices numbered from 130406 to 130422 with the exception of 130420 which is missing. Various amounts are claimed on a fortnightly basis with the lowest being $1,287.00 and the highest $3,388.00.
The second series of invoices addressed to Kia are six in number from 130431 dated 11 May 2007 to 130436 dated 20 July 2007. In this series of invoices the greatest fortnightly figure is $4,246.00 and the smallest, the last in the series, $1,078.00. All of the invoices make provision for the payment of GST which is included in the amounts which I have indicated. It must be said the invoices are not very informative, stating only the date, the name and address of the appellant and the addressee and the amount claimed including GST. There is no indication of the basis on which the sums claimed are calculated.
At the hearing of the appeal the appellant tendered invoices 130401 (21 December 2005) through to 130405 (15 February 2006). These are addressed to Cobra Gyprock. Also tendered were invoices 130423 to130430, dated from16 November 2006 to 24 April 2007, which are addressed to Simco Ceilings.
A number of taxation returns and Notices of Assessment are also relied on. These are for the years ended 30 June 2001 to 30 June 2008, with the exception of the financial year ending on 30 June 2002. For convenience I will set these out in a table. The blanks are in relation to documents not in evidence:
Financial
Year (ending 30/6/..)Gross
EarningsM/Vehicle
ExpensesOther
ExpensesNett
Notice of
Assessment2001 benefits $ 6,627
business $10,796
total: $17,423$2,925
$1,390
$13,108
$
2003 benefits $ 3,349
business $23,183
total: $26,532$5,361
$6,988
$14,183
$
2004 $60,145 $8,893 $25,940 $25,312 $25,312 2005 $65,208 $9,175 $32,444 $23,589 $23,589 2006 $38,280 $5,362 $20,661 $12,257 $12,257 2007 $50,235 $7,902 $22,505 $19,828 $19,828 2008 $10,882
Evidence was obtained from a former director of DDB Pty Ltd, Mr Doko Pantic (not to be confused with Mr Dusko Panic of Kia). The appellant was a former employee of his between 2001 and 2005 and worked as a gyprocker on a subcontract basis. The Appellant used his own ABN number and issued Mr Pantic with an invoice at the end of each week.
A vocational and functional assessment report from Injury Assess dated 30 April 2008 was relied on by the appellant. This is jointly signed by Irinah Jurkowski, a rehabilitation counsellor, and Dr Horace Ting, an occupational therapist/vocational assessor. The appellant was interviewed on 20 March 2008 at the request of his solicitors and a work history was obtained from him. He told his interviewer that he had arrived as a refugee in Australia in April 2000. He had obtained employment as a gyprocker from March 2001 to May 2001 when he began to feel physical discomfort and chest pain. He resumed work in March 2003 and continued until July 2007. 35 documents described as pay record sheets from 8 December 2005 to 20 July 2007 were made available to Injury Assess in order that an opinion might be expressed as to the appellant’s probable earnings as a gyprocker. These record sheets would appear to be the same as the invoices which are in evidence. On the basis of these the maximum weekly gross income was stated to be $2,794.00 and the average gross weekly income $1,253.50.
Kia’s Evidence
A statement was obtained from Dusko Panic on 10 October 2007. He was the principal of Kia the main business of which was gyprocking. At that time there were three employees and Kia had been operating for two and a half to three years. He had employed the appellant as a contractor to perform gyprocking duties and he had commenced at Bathurst Hospital on 26 April 2007. Prior to that he thought the appellant may have been working for Paradise Ceilings. The appellant had done a very small amount of similar work for Kia about two years earlier. As a sub-contractor the contractor was paid $5.00 per square metre for materials installed or an hourly rate of $35.00 when not busy.
Mr Panic enlarged on his evidence in a later statement. He said that the apppellant was paid on a job-to-job basis. The appellant had done perhaps two previous jobs before the Bathurst job and would always provide his own tools and equipment. He said when he allocated the appellant a job he would have no further say and he would let him choose the manner in which it would be completed. The appellant was not required to wear a company uniform or company logo. Safety vests were worn but there was no writing on them. The appellant could subcontract any part of the work to other persons if required and could choose his own hours of work, being paid according to the amount of work completed on a square metre basis.
SUBMISSIONS BEFORE THE ARBITRATOR
The issues were stated to be:
(1) injury;
(2) worker or deemed worker, and
(3) the quantum of compensation payable.
On behalf of the appellant a concession was made that he was not a “worker” as defined in the workers compensation legislation but a contractor and therefore a deemed worker under Schedule 1 clause 2 of the 1998 Act. The main thrust of the submissions on behalf of the appellant was as to the effect of the amendment to Schedule 1 clause 2 which took effect on 1 January 2006 so that, it was said, it was only necessary to prove that the appellant did not sublet the contract or employ any worker to bring himself within the deeming provisions of the clause. Reliance was placed on two decisions by Arbitrator McManamey in which he had held that this was the case. It was faintly submitted that the worker could also fall under the first part of Schedule 1 clause 2.
In relation to this counsel for the appellant said, at [T6.23]:
“Now, arguably, he comes under that as well but the argument is not as strong because he was clearly carrying out a trade, he was clearly carrying out a business but as a sole trader. So I don’t really submit to you strongly that he comes under the first head of that definition, but the emphasis is ‘or’. He definitely, in my submission, comes under the second head of that definition, and there can be, in my submission, no doubt that he does.
Now, it was the case that before the legislation was amended he would have had to satisfy both aspects of the previous definition, that is, he would have had to establish that the contract was work exceeding $10 in value, that it was not work incidental to his trade or business and that he neither sublet the contract nor employed anyone else before he could avail himself of the protection of that provision or bring himself within the provision of deemed worker. The Government amended that definition to delete (b), because sub-paragraph (b) is simply no longer there, but they left the ‘or’ in quite deliberately, in my submission.”
On behalf of Kia it was pointed out that the appellant had had an ABN since 2001 and none of the income earned was described as wages or salary. He was paid per square metre with flexible hours, paid his own business expenses and paid his own tax and was therefore not a deemed worker. The following exchange took place at [T12.20].
“Mr Turner
[for Kia]:For the purposes of sub (a) of that clause, as I understand it, my friend is not submitting that the applicant was doing anything but working [inaudible] to his trade or business.
Mr Taylor
[for the
Worker]:That’s correct. I mean, that clearly was. It’s arguable [inaudible], on balance, he probably was.
At the hearing of the appeal the relevant part of the sound recording of the arbitration was listened to and the parties agreed with me that the first [inaudible] referred to was “incidental” and the second was “he wasn’t”.
Submissions were made whether the injury had occurred prior to the appellant commencing with Kia on 26 April 2007 since the worker had incorrectly identified a date in March 2007 as being the date of injury.
ARBITRATOR’S REASONS
The Arbitrator firstly found that injury had occurred as was alleged by the appellant and the discrepancy in dates had been due to an error on his part which had been perpetuated by the various doctors to whom he was referred.
The Arbitrator noted at [36] of her reasons a concession by the appellant’s counsel that he would not have been deemed a worker under Schedule 1 Clause 2 prior to 1 January 2006. She then dealt with the amendments made to the clause by the Workers Compensation Legislation Amendment (Miscellaneous Provisions) Act 2005 No. 113, section 4 and Schedule 2.1[3], which commenced on 1 January 2006. After referring to a number of authorities on statutory construction and the history of Schedule 1 clause 2, the Arbitrator declined to follow the decisions of Arbitrator McManamey and found that, as the appellant was performing work incidental to a trade or business regularly carried on by him, he was not a deemed worker. The Arbitrator did not give any reasons for that finding, no doubt relying on what she considered was a concession made by counsel in relation to that issue.
SCHEDULE 1 CLAUSE 2 GENERALLY
Prior to the amendment which took effect on 1 January 2006 Schedule 1 clause 2 was in the following terms. I have placed the words deleted by the amendment in square brackets:
“2 (1) Where a contract:
(a) to perform any work exceeding $10 in value (not being work incidental to a trade or business regularly carried on by the contractor in the contractor’s own name, or under a business or firm name), or
[(b) to perform any work as an outworker,]
is made with the contractor, who neither sublets the contract nor employs any worker, the contractor, is for the purposes of this Act, taken to be a worker employed by the person who made the contract with the contractor.
[(2) In this clause:
outworker means a person to whom articles or materials are given out to be made up, cleaned, washed, altered, ornamented, finished or repaired, or adapted for sale:
(a) in the person’s own home, or
(b) on other premises not under the control or management of the person who gave out the articles or materials.]
(3)A person excluded from the definition of worker in section 4(1) because of paragraph (d) of that definition is not to be regarded as a worker under this clause.”
Schedule 1 clause 2 is now published under section 45C of the Interpretation Act 1987 as follows:
“2.(1)Where a contract:
(a) to perform any work exceeding $10 in value (not being work incidental to a trade or business regularly carried on by the contractor in the contractor’s own name, or under a business or firm name), or
(b) (Repealed)
is made with the contractor, who neither sublets the contract nor employs any worker, the contractor, is for the purposes of this Act, taken to be a worker employed by the person who made the contract with the contractor.
(2)(Repealed)
(3)A person excluded from the definition of worker in section 4(1) because of paragraph (d) of that definition is not to be regarded as a worker under this clause.”
A new clause 1A deals specifically with outworkers.
The predecessor of Schedule 1 clause 2, initially of the 1987 Act and now of the 1998 Act, was section 6(3A) of the Workers’ Compensation Act 1926. That provision had originally been enacted in slightly different terms as section 6(4). However, this was repealed in 1929 and re-enacted in 1942 as sub-section (3A). The history of the amendment is provided by Rainbow J in Turner v Stewardson, Stubbs & Collett [1961] 35 WCR 169 (‘Turner’). The Victorian workers compensation legislation was amended in 1946 to add section 3(6) which was in similar terms to section 6(3A). This was considered by the High Court in Humberstone v Northern Timber Mills [1949] HCA 49; (1949) 79 CLR 389 (‘Humberstone’). That case was determined on the basis that the Victorian amendment did not apply to the deceased contractor in that case because he had entered into the contract prior to the amendment. There was a difference however in the opinions of Latham CJ and Dixon J as to whether, if the amendment had applied, the contractor would have been within its terms. The Chief Justice considered that the contractor was doing work, as a carrier, in a business which the contractor was regularly carrying on upon his own account. Dixon J considered that at the time of injury the contractor was not carrying on an independent trade or business, although if looked at, at the time that the initial contract was entered into, the position may have been different. He did not think that it was right to go back to the state of affairs existing at the time of the original contract.
His Honour, Dixon J, said the following at 401 and 402 and this passage from his judgment has been cited regularly since:
“I think that the purpose of the exception or exclusion expressed by the words in question was to confine the benefit of the conclusive presumption which it establishes to persons who do not conduct an independent trade or business, who are not holding themselves out to the public under their own or a firm or business name as carrying on such a trade or business and who do not in the course of that trade or business, as an incident of its exercise, undertake the work by entering into the contract. The provision will thus cover men who work for the principal but have no independent business or trade and men who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business. The word ‘trade’ is capable of including any handicraft and in that sense it may seem to lack the element of systematic practice or holding out which the idea of openly conducting a distinct or independent trade or business and seeking custom implies. But a consideration of the policy of the provision as well of its text appears to me to show that the distinction it seeks to draw is between on the one hand an independent contractor whose relation with the principal is special or particular either because it is outside the course of the general business of the contractor or the general practice of his trade or because he has no such general business or is not a general practitioner of his trade, and on the other hand an independent contractor who performs work successively or perhaps concurrently for his customers or others in the course of a definite trade or business carried on systematically or who holds himself out as ready to do so. The language of the sub-section is derived from the provision that stands as s14(1)(a) of the Victorian Workers’ Compensation Act 1928, where the words are ‘where any person … in the course of or for the purposes of his trade or business contracts with any other person’. The suggestion which this language conveys of the existence of a business or the practice of a trade is much strengthened in sub-s.(6) by the words ‘carried on,’ ‘regularly’ and ‘in his own name or under a firm or business name.’ These all indicate a business or trade conceived as independently existing or exercised by a person holding himself out to the public under a name or style. No doubt the policy is a matter of inference but it seems reasonable to suppose that it was considered proper that a person conducting a business in the course of which he contracted to perform work should himself carry the risk of personal injury as one of the hazards of his business, while the man who worked under contract but only for the employer or without any general trade or business or outside his trade or business should, like an ordinary employee, be insured by the Act against risk of injury in his work.”
Section 6(3A) of the 1926 Act was considered by the High Court in Zuijs v Wirth Brothers Pty Ltd [1955] HCA 73: (1955) 93 CLR 561. In the majority judgment Dixon CJ, Williams, Webb and Taylor JJ approved the explanation given to the bracketed words in the Victorian provision by Dixon J in Humberstone. Nonetheless, it was held that the section was not appropriate to a contract of indefinite duration for repeated performances by a trapeze artist. The appellant succeeded, however, on the basis that he was a worker in the primary sense.
In Turner, Rainbow J found that a carpenter who usually worked as an employee but entered into separate contracts to work on a number of cottages was not a deemed worked because the exception in the bracketed words in section 6(3A) did not apply.
The Full Court in Turner, Evatt CJ, Herron and Collins JJ, disagreed ([1962] NSWR 137). Their Honours noted what had been said in Humberstone and Zuijs and held that on the evidence it could not be said that the applicant had carried on the business of a building contractor. He had only entered into two isolated contracts when employment was difficult to obtain. He had not tendered for that work but had accepted a schedule of rates which had been given to him on a take it or leave it basis. What was relevant, it was said, was the applicant’s status at the time he entered into the contract.
Their Honours, in a joint judgment, said the following at 139:
“Looked at broadly, the Legislature meant to provide that persons who are in business for themselves, and who systematically and regularly accept work to be done under contract, and who hold themselves out as open to be employed under contract, are expected to undertake the risk of injury and not rely for compensation upon the principal whose contract work they are performing at the moment of injury. The original notion that a contractor is deprived of the benefits of the Act because he is not a worker has disappeared, and today many small contractors who undertake contract work, not as a regular or systematic practice, are covered by the Act. This is in keeping with modern practice as to payment for labour at piece work or contract rates (Graham v Bentley (1959), 76 WN (NSW) 603, a case where the facts were analogous to the present).”
Cam v Cousins Interstate Transport Pty Ltd [1964] NSWR 1288 (‘Cam’) was another appeal to the Full Court from Rainbow J. His Honour had determined that the applicant who had been using his vehicle to carry steel for the respondent for six months, to the exclusion of any other work, was a deemed worker by reason of section 6(3A). The Full Court agreed. While it might have been said that at the time the applicant first contracted with the respondent he had been carrying on a business or trade regularly in his own name, by the time of the accident this had changed and he had ceased to do so. The decision of the Full Court in Turner was not referred to.
Davis v Pioneer Concrete (NSW) Pty Ltd [1976] 1 NSWLR 562 (‘Davis’) was another case of a contractor driving his own vehicle, in this case a concrete mixer which bore the legend “Pioneer”. Driving this vehicle for Pioneer was the only work done by the contractor for a number of years prior to his injury. The contractor had employed a driver during his temporary absences and the question was whether this disentitled him to compensation. This in turn required a determination as to the particular contract under which the contractor was working at the time of his injury, that is, either a single contract to perform work or individual contracts entered into each day. Hutley JA dismissed this suggestion by the respondent that the contractor had been carrying on the work regularly in his own name. Nonetheless, relying on Humberstone, his Honour held that there was a single contract and since the contractor had during that contract employed workers he was excluded from the deeming provisions of section 6(3A).
Glass and Mahoney JJA held otherwise, namely that there were separate contracts entered into each day. The construction of section 6(3A) suggested by the Chief Justice in Humberstone was rejected in favour of that proposed by Dixon J.
Mahoney JA agreed with the order proposed by Glass JA dismissing the employer’s appeal but gave separate reasons. His Honour considered whether the work was incidental to a trade or business carried on by the contractor and found that what the contractor did was not incidental to that trade or business. His Honour said at [576]:
“I do not think that the work that was being done was ‘an activity serving no independent purpose but carried out in order to serve some other purpose’: Robson v Dixon ([1972] 1 WLR 1493 at p1498; [1972] 3 All ER 671 at p 677). If there was a trade or business, that which was being done was the trade or business itself and, in the relevant sense of the term, what Davis did was not ‘incidental’.
This, in my opinion, is the meaning of the bracketed words to which Dixon J referred in the Humberstone case ((1949) 79 CLR 389 at pp 401, 402), in holding that the work then in question was not incidental to a trade or business, within the Victorian subsection.”
In Higgins v Jackson & Ors (1976) 135 CLR 174 (‘Higgins’) the High Court considered the case of a handyman who contracted to repair the awning of a local cinema. The sole issue determined by the High Court was in relation to the contractor holding himself out as carrying on a business. Barwick CJ, with whom Stephen, Mason, and Murphy JJ agreed, held that there was no separate element required in section 6(3A) of holding out. It was sufficient that the contractor regularly carried on a business in his own or a firm name.
Earlier in the Court of Appeal, Hardie, Reynolds and Bowen JJA, (Higgins v North Coast Theatres and Drive-Ins Pty Ltd and Others) ([1974] 1 NSWLR 9) the contractor had submitted that in doing odd jobs he was not carrying on a definite trade or business. This argument was rejected and Hardie JA said at 12:
“I see no justification for the view that the relevant part of s 6(3A) has no application to a case such as the present, where the contractor’s trade or business embraces a variety of tasks or contracts within the building industry and found by the tribunal of fact to be a trade or business within the meaning of the subsection.”
In Gerob Investments Ballina Pty Ltd t/as Beach Life Homes v Compton [2007] NSWWCCPD 180 (‘Compton’), Deputy President Roche considered the case of a contractor who was a carpenter and who had worked exclusively for a business which had operated under different names for a period of approximately 34 years. He was in partnership with his wife and was found by the Arbitrator to be either a worker or a deemed worker. The contractor charged GST, had his own Australian Business Number, wore the uniform provided for him and was paid by invoicing the companies at certain stages of the completed jobs. The Deputy President agreed with the Arbitrator that the contractor was either a worker or deemed worker.
Pasqua v Morelli Constructions Pty Ltd [2009] NSWWCCPD 153 (‘Pasqua’) was another decision of Roche DP. The applicant had been employed by the respondent, first as an apprentice and then as a carpenter, for about eight years with several absences because of work injuries for which compensation was paid. In mid 2007 he began work on his own account as a carpenter and did this for about a year until, because of slackness of work, he returned to the respondent to work on a contract basis until he suffered a further injury three months later. The Arbitrator decided that the applicant was not a deemed worker but the Deputy President disagreed. He regarded it as significant that the applicant did not advertise or perform work for anyone else at the relevant time. The question was not, he said, whether the applicant had a business name but whether he was regularly carrying on a trade or business during the relevant period. He also thought that the applicant had a special or particular relationship with the respondent. He said this at [53]:
“… [T]he appropriate question in cases of this kind is whether or not the contractor was, at the relevant time, regularly carrying on a trade or business in his own name or under a business or firm name.”
He regarded the relevant time as being the time at which the injury occurred. He continued at [56]:
“It is submitted that it is not significant that Mr Pasqua had no marketing, signage or advertising because word of mouth recommendations carry as much or more weight with head contractors in the building industry as signage and advertisements. Whilst it is true that personal recommendations are important in all industries, the lack of marketing, signage and advertising is a further indicator, though not decisive, that Mr Pasco was not regularly carrying on a trade or business during the relevant period.”
SUBMISSIONS ON APPEAL
Appellant’s Submissions:
The appellant concedes that the submissions made to the Arbitrator regarding Schedule 1 clause 2, were incorrect and that the four matters referred to by Bainton AJA, with whose reasons Kirby ACJ and Rolfe AJA agreed, in Scerri v Cahill & Anor (1997) 14 NSWCCR 389 (‘Scerri’) must be established by an applicant seeking to rely on the clause. Bainton AJA in Scerri said the following at 399:
“On its proper construction, clause 2 of Schedule 1 requires an applicant who relies on it to establish each of the ingredients, both positive and negative which identify the relevant ‘work’.
What he must establish is:
1. that he was a party to a contract with the respondent to perform work;
2. that the work exceeds $10 in value;
3. that the work is not work incidental to a trade or business regularly carried on by the applicant in his own name or under a business or firm name; and
4. that the applicant has neither sublet the contract nor employed workers in the performance of it.”
It is submitted these ingredients were all established by the evidence relied on by the appellant. It was further submitted that the concession said to have been made by counsel for the appellant at the arbitration that his client would not have been a deemed worker under the provisions of Schedule 1 clause 2 prior to 1 January 2006 was irrelevant to the question which the Arbitrator had to determine. The substance of the complaint made by the appellant is that the Arbitrator did not consider whether the appellant was within Schedule 1 clause 2, properly construed, rather than the interpretation of the clause which had been urged by his counsel at the arbitration. Reliance is placed on the decision of the Court of Appeal in Monier Limited t/as Reliance Roof Tiles v Szabo (1992) 28 NSWLR 53 (‘Monier’) which was said to deal with an almost identical situation.
Further submissions lodged on behalf of the appellant deal with the Arbitrator’s failure to give reasons for finding that he was carrying on the trade or business of a gyprock fixer and that he was injured while performing work incidental to that trade or business regularly carried on by him in his own name.
At the hearing of the appeal further submissions were made. It was submitted that on all of the evidence:
(a) the appellant was not carrying on a trade or business in his own name;
(b) he lacked formal qualifications as a gyprocker or a building licence;
(c) he did not advertise;
(d) he had no workers compensation insurance or superannuation;
(e) he was obliged to accept a set rate of $5.00 per square metre or $35.00 per hour for the work he did;
(f) Mr Panic prescribed the hours of work, including leaving early on Fridays;
(g) the appellant was provided with and used tools owned by Kia;
(h) he was told what to do by Mr Panic or others on site;
(i) clothing was provided to the worker by Mr Panic bearing the name “Melvin Constructions”;
(j) he had no business address (apart from his home address) nor did he have a business name, and
(k) accommodation was provided for him in Bathurst by Kia.
Pasqua was relied on as being so similar on its facts that the same conclusion should be reached in this case.
It was submitted that the appellant was entitled to raise this new argument as to the provisions of Schedule 1 clause 2 because of the breadth of the review power contained in section 352 of the 1998 Act and although I was not referred to any relevant authority on this I took it to be an oblique reference to a number of Court of Appeal decisions dealing with this section including Aluminium Louvres & Ceilings Pty Limited v Xie Qin Zheng [2006] NSWCA 34; State TransitAuthority of New South Wales v Fritzi Chemler [2007] NSWCA 249; Tan v National AustraliaBank Ltd [2008] NSWCA 198 ; Duinker v St Vincent de Paul Society Aged and SpecialServices Limited [2008] NSWCA 127; Cook v Midpart Pty Ltd t/as McDonalds Forster & Anor [2008] NSWCA 151 and Sapina v Coles Myer Limited [2009] NSWCA 71.
Kia’s Submissions on Appeal:
The written submissions filed on behalf of Kia seek to support the Arbitrator’s decision in relation to her rejecting the argument by the appellant that the requirements of Schedule 1 clause 2 should be read disjunctively. The Application to Appeal does not however challenge that decision.
At the hearing of the appeal further submissions were made on behalf of Kia by its counsel who submitted that the concessions made at the arbitration were such as to bind the appellant and it would be an abuse of process to permit the appellant to now raise an argument which had not been raised at the arbitration. In particular, it was submitted that Pasqua was in a different category to the present case in that the worker in that case had a particular or special relationship with the respondent which was lacking in this case. It was pointed out that the appellant was able to change his work arrangements to piece work and did so after working for one day on an hourly rate. The extensive deductions shown in the appellant’s tax returns indicated that a trade or business was being carried on by him as did the appellant’s work history and the number and variety of persons for whom he worked.
I now turn to the determination of this appeal.
DISCUSSION AND FINDINGS
As I have earlier indicated, there are two grounds of appeal. The second ground of appeal which I will consider first says that the Arbitrator erred in failing to provide adequate reasons for finding that the appellant was not a deemed worker pursuant to Schedule 1 clause 2 of the 1998 Act. The precise finding made by the Arbitrator, at [62], was that:
“The Applicant was injured while performing work incidental to a trade or business regularly carried on by him in his own name. I find that he is not a deemed worker pursuant to clause 2 of Schedule 1 of the 1998 Act. I also find that as the Respondent contended and the Applicant accepted, he was not a worker pursuant to section 4 of the 1998 Act.”
As I have earlier indicated, the arbitration was conducted on the basis that, but for the particular construction of Schedule 1 clause 2 advanced on behalf of the appellant, he would fail in establishing that he was a deemed worker. The Arbitrator rejected that construction and it is not pressed on this appeal. I must confess to having the utmost difficulty in seeing how this ground of appeal can be sustained. No authority was cited to me as to why the Arbitrator was under an obligation to give reasons for making a finding which was inevitable once the legal argument advanced by the appellant was rejected. This ground of appeal must, in my view, be rejected.
The other ground of appeal asserts that the Arbitrator erred in failing to determine that the appellant was a deemed worker by reason of Schedule 1 clause 2 of the 1998 Act. A similar answer may be given to that given in respect of the ground dealt with above; namely that the Arbitrator has given reasons for making the finding she did on the argument presented to her and could not have been in error in failing to determine the matter in a way which had not been urged on behalf of the appellant.
That however is not the end of the matter. I accept that a Presidential member has wide powers on the hearing of a review pursuant to section 352 of the 1998 Act. I have referred to some of the relevant authorities at [57].
It is a separate question whether the appellant ought be permitted to raise on the hearing of this appeal arguments not pressed before the Arbitrator. I gratefully adopt what was said by Roche DP in Norambuena v Transfield Services (Australia) Pty Ltd [2009] NSWWCCPD 52 at [63] namely:
“The correct principle is that, in general, a point cannot be raised for the first time on appeal when it could have been met by calling evidence below (Coulton v Holcombe [1986 HCA 33; (1986) 162CLR 1 at 7; Park v Brothers [2005] HCA 73, (2005) 222 ALR 421 at 435; John Orford v Qi Ying He [2002] NSWCA 152). What is required is a determination of whether a party suffers any prejudice as a result of the opposing party presenting a different argument on appeal to the argument presented at arbitration. Normally, if the new or different point sought to be raised on appeal is restricted to a legal point that does not require the calling of additional evidence there will be no prejudice to the other party and, subject to compliance with the rules of procedural fairness, the argument will be allowed. That is especially so in the Commission, which is bound to act according to equity, good conscience and the substantial merits of the case without regard to technicalities (section 354(3) of the 1998 Act).”
As I have indicated, prior to the arbitration the issue of deemed worker was contested by Kia and it was only at the arbitration that the claim made was limited by reason of the concession made by counsel. Kia had come to the arbitration ready to meet the claim made and had lodged all the evidence on which it intended to rely, including, it seems to me, the evidence relevant to the argument now sought to be made in this appeal. I am not persuaded that there is any additional evidence on which Kia could have sought to rely and counsel for Kia could not point to any relevant prejudice to his client if the appellant were allowed to now raise this new point. Both counsel addressed me at length on the application of Schedule 1 clause 2 to the facts of this case. Accordingly it is appropriate that I should now determine whether the appellant is to be deemed to be a worker on the basis of those submissions.
I make the following observation concerning Schedule 1 clause 2 and decisions on it:
(a) A contractor’s status may change and it is the status of the contractor at the time of injury which is significant (Dixon J in Humberstone at 402 and 403; Cam at 1290; Pasqua at [53]; Turner, contra at 139 and 140.)
(b) A person may regularly carry on a trade or business in his own name although such a person only relies on word of mouth to obtain work ( Barwick CJ in Higgins at 176; Byrne v Mulholland (1995) 11 NSWCCR 739 (Byrne)).
(c) A “trade or business” is an expression wide enough to encompass the work performed by a handyman (Higgins, Court of Appeal at 12) or a supplier and installer of television antennae (Byrne). No formal training or qualification is required.
(d) A period of work exclusively for one principal may indicate that a contractor has ceased carrying on a trade or business (Humberstone, 23 years; Davis, 3 years; Cam, 6 months; Compton, 34 years) or, putting it in an alternative way, the work performed is not “incidental” to a trade or business but has become the trade or business itself.
How long a period of exclusive work is sufficient to bring about an inference that the carrying on of a trade or business has ceased must, in my view, depend on the manner in which the contractor regularly carries on his trade or business. Some contracts for work may regularly be for a day or less while others may be much longer. In the area of industrial or commercial construction an individual contract may run for months. I doubt that a contractor who regularly undertakes separate contracts which each extend over many months becomes a deemed worker because of the length of his or her engagement in a particular contract. It is a question of fact and depends on all the circumstances of the case. For example, would a different result be arrived at if the injury occurred on the first day of such a contract rather than some months into its execution? The common characteristic of the cases to which I have referred in sub-paragraph (d) of [67] above is that the contracts had become contracts of indefinite duration and not for a particular job or period. That is, the contract would continue for so long as both parties wished it to do so.
It is undeniable that there has been for some time a tendency for many workers to call themselves or be called contractors rather than employees. As Mason P said in National Transport Insurance Limited v Chalker & Ors [2005] NSWCA 62 at [61]:
“The Court is not blind to the general trend towards to [sic] ‘outsourcing’ that is occurring in an increasingly de-regulated labour market.”
Whether they are in fact contractors must be looked at in the light of all the circumstances.
McColl JA in Australian Air Express Pty Limited v Langford [2005] NSWCA 96 (‘Langford’) said the following at [79] and [80]:
“Text writers have commented upon the ‘growing tendency for those who hire labour to exploit the way in which work relationships are categorised by the law, through carefully constructed arrangement … so that the workers concerned will be categorised as something other than employees, despite to all practical intents and purposes performing the same role as employees’ – a process they describe as ‘vertical disintegration’: see Creighton & Stewart, Labour Law an Introduction, 3rd Ed, The Federation Press, 2000 at [7.07].
Critics of the common law notion of employment suggest that a more apt description of the status of workers transformed from employees into independent contractors ‘by the magic of contractual language’, and whose working environment remained unchanged, would be that of a ‘dependent contractor’ because of the presence of factors in such relationship strongly indicative of the relationship of employment: see Konrad v Victoria Police [1999] FCA 988; (1999) 91 FCR 95 at 126 [101] per Finkelstein J; Creighton & Stewart, at [7.08].”
The terms of Schedule 1 clause 2 have essentially remained unchanged since 1926. The amount of $10.00 (originally £5) as the value of the work referred to has not changed. This may have represented a substantial sum in earlier times however it is difficult to imagine any work having a value of less than $10.00 at the present time. Whether the clause still serves the same purpose in the current economic and social circumstances as it originally did is unclear. Rainbow J in Turner, decided almost 50 years ago, noted at 171, that he had suggested, in other cases, the statutory abolition of the distinction between contracts of service and contracts for services in the case of individuals working alone. This however has not happened.
In this case it was conceded that the appellant was employed under a contract for services, that is, as a contactor. It was however denied that he was an independent contractor, perhaps an unconscious allusion to what was said by McColl JA in Langford ([70] above). Many matters were referred to as showing that the worker was not carrying on a trade or business in his own name. These were matters which would normally be relied on in support of the contention that the appellant was engaged under a contract of service.
The first question which I am required to determine is whether the appellant has discharged the onus of proof that he was not regularly carrying on a trade or business in his own name at the time he was injured.
It is clear that the appellant did not advertise but relied upon his being known to be available as a gyprocker by other Serbian-speaking contractors. He was limited in this way because he did not speak English. There is no doubt that the appellant did not employ any person at any time. It is also clear that from the time he commenced gyprocking work he invoiced those persons for whom he was working on a weekly or fortnightly basis and, having an ABN, charged GST in respect of his work. It is also clear that the appellant had substantial business deductions for all of the years in which he worked, in some years representing more than half of his gross earnings. What those deductions represented remains unexplained. The copies of tax returns relied on are incomplete and although an attempt was made to obtain complete copies from the Australian Tax Office, this was unsuccessful. At the hearing of the appeal I commented that the copies of the tax returns appeared to be mere skeletons and lacked the detail which one would have expected. In particular, there appears no reference to dependants and business expenses are aggregated under one heading as are motor vehicle expenses. It appears from the tax returns that the worker has never been in receipt of wages as an employee and all his earnings have been received for subcontract work. Doing the best I can, the appellant’s work history appears to be as follows:
2001 to 2005 DDB Pty Limited
Dec 2005 to Feb 2006 Cobra Gyprock Pty Ltd
Mar 2006 to Oct 2006 Kia Ceilings Pty Ltd
Nov 2006 to Apr 2007 Simco Ceilings
Apr 2007 to Jul 2007 Kia Ceilings Pty LtdThe first period referred to was interrupted by ill health for almost two years and it is unclear on the appellant’s own statements that he worked exclusively for DBB until 2005.
While many of the matters relied on by the appellant appear to suggest that he was employed under a contract of service, this is not the position taken by the appellant. Nor is there, as I understand it, any suggestion that the appellant’s status as a subcontractor was merely a sham. He derived considerable financial advantage from it by way of being able to make deductions from his income for taxation purposes. There are some factors or indicia which point to the appellant regularly carrying on a trade or business while others point in the other direction. The matters which indicate that he was not are the provision of accommodation for the appellant at Bathurst by Mr Panic, the use of Kia’s tools, the fixed rate of payment and the provision of clothing. I do not regard the other matters relied on by the appellant as being inconsistent with his carrying on a trade or business on his own account. There are many ways in which a trade or business may be carried on. I have earlier noted that the appellant was restricted in his work contracts to fellow Serbian-speakers but this does not mean that he is not holding himself out as ready to perform work for other principals at the conclusion of each contract on which he was then engaged. As the Chief Justice said in Higgins at 176: “Thus a contractor who regularly contracts can scarcely be said not to hold himself out as carrying on the business in the course of which he makes the contracts”.
There is no suggestion that the subject contract with Kia was in any way different from contracts entered into with others earlier except as to the manner of payment, that is, piece- work rather than an hourly rate. I see nothing inconsistent with the appellant regularly carrying on a trade or business merely because he had on prior occasions been paid an hourly rate. So far as the provision of accommodation is concerned, this must be regarded as somewhat unusual, nevertheless this may also be explicable on the basis of friendship, a shared language and the difficulty the appellant may himself have had in arranging accommodation. There is however no evidence concerning these matters.
As I have earlier noted the evidence was that the appellant used his own tools as well as those of Kia. The use of Kia’s tools is not in my view inconsistent with the appellant carrying on a trade or business in his own name. Nor was the provision of clothing bearing the name “Melvin Constructions’. There is no indication that he was obliged to wear such clothing and if he had been I would not regard that as meaning that he was not on that account carrying on his own trade or business.
The setting of a rate of payment for work performed by the appellant by reference to an accepted tariff does not in my view require the conclusion that the appellant was not regularly carrying on a trade or business.
His lack of qualifications in gyprocking was said to tell against the appellant carrying on a trade or business. I do not agree, relying on what was said by Dixon J in Humberstone at 401 and 402; Hardie JA in Higgins at12; andNeilson J in Byrne at 744 .
For Kia it was submitted that the appellant had contracted successively for a number of principals, he was able to and did re-negotiate the basis of his payment by Kia and the extent of business deductions indicate that a business was being carried on. I regard these matters as persuasive. I note that the appellant said that he could have taken on a worker to assist him but did not do so. He also indicated that he was free to work such hours as he chose and worked longer on occasions than others at the work site. So far as the time of departure from Bathurst on Fridays is concerned, if he and Mr Panic travelled in the one car as he said they did, there would have to be agreement as to when they did so.
I conclude that the appellant who bears the onus has failed to prove that he was not carrying on a trade or business regularly in his own name at the time he was injured. I regard Pasqua as being distinguishable on its facts and shall shortly state why. In that case the contactor had a long period of employment with the respondent and had served his apprenticeship with it. This was found to give rise to a “special or particular” relationship. Although the appellant had worked for Kia before, there is not, in my view, any basis for saying that he had a “special or particular” relationship with it. Kia was just another principal with whom he contracted. The Deputy President in Pasqua also described at [56] the lack of marketing, signage and advertising as an indicator, though not decisive, that Mr Pasqua was not regularly carrying on a trade or business at the relevant time. It would appear that while Mr Pasqua was working independently as a carpenter he did take some steps to advertise his availability. The authorities to which I have earlier referred, namely Higgins and Byrne, establish that it is not necessary to advertise in order to be found to be regularly carrying on a trade or business. I take the Deputy President’s reference to this as indicating a change in the manner in which Mr Pasqua had conducted his business upon his resumption of work with the respondent. There was no change in this case as the appellant has never advertised but had always relied on word of mouth to obtain work.
Although not relied on at the hearing of the appeal, the written submissions refer to Monier as being similar on its facts to Pasqua. No two cases are exactly alike. The facts are not stated in the report with any particularity but it appears that the contractor was a tiler who laid roofing tiles supplied by Monier. As with the present case, the contractor did not advertise but in that case the tiling work was carried out exclusively for Monier. That is not the case in this appeal. That case was concerned with the question whether the employment of one worker by a contractor would exclude that contractor from the deeming provisions of section 6(3A) of the 1926 Act since it referred to “workers” rather than “a worker”. It was held by the Court of Appeal that the employment of a single worker did not disqualify the contractor. Schedule 1 clause 2 now refers to “any worker”. I do not think that anything said in Monier compels a finding that the appellant was not regularly carrying on a trade or business in this case.
I now turn to the question whether the work which the appellant contracted to perform for Kia was or was not incidental to a trade or business regularly carried on by him, with emphasis on the word “incidental”. It must be noted that no submissions were made on the appeal concerning this. In the appellant’s statement to which I have referred at [19] he said that the work he was doing for Kia was incidental to his trade or business. I attach very little significance to this statement which would appear to have been drafted for him by his legal advisors. If he had said that the work was not incidental I would have made the same comment. The difficulty with the word “incidental” is that it has two relevant meanings which are somewhat opposed.
The online Macquarie Dictionary gives the following definition of “incidental”:
“adjective 1. happening or likely to happen in fortuitous or subordinate conjunction with something else.
2. incurred casually and in addition to the regular or main amount: incidental expenses
- noun 3. something incidental, as a circumstance.
4. (plural) minor expenses.
- phrase 5. incidental to, liable to happen in connection with; naturally appertaining to.”
As I have noted at [47], Mahoney JA took the definition of “incidental” from an English tax case Robson v Dixon (‘Robson’). The definition which was suggested in that case at 1498 was: “an activity (here the performance of duties) which does not serve any independent purpose but is carried out in order to further some other purpose”. The defined phrase appearing in section 11 of the Finance Act 1956 was “merely incidental to”. That was a decision of Pennycuick V-C and concerned the tax liability of an airline pilot who flew for a Dutch airline but who had his family home in England. The question was whether duties performed by the pilot in the United Kingdom were to be treated as performed outside the United Kingdom because their performance was “merely incidental to the performance of other duties outside the United Kingdom”. In that case, since the pilot regularly landed in and took off from the United Kingdom and that was a regular part of his duties and not merely incidental to them, it was held that the exclusion did not apply.
It appears to me that the Vice-Chancellor adopted a definition in Robson closest to the first meaning given by the Macquarie Dictionary. It also appears to me that the definition offered by the Vice-Chancellor takes its colour from the inclusion of the word “merely” in the defined phrase.
Dixon J in Humberstone at 401 referred to persons “… who do not in the course of that trade or business, as an incident of its exercise undertake the work by entering into the contract” (emphasis added).
His Honour found both that the work being performed was not work “incidental to a trade or business regularly carried on by him in his own name” (at 401) and that “at the time of the accident the deceased was not conducting an independent trade or business and was not holding himself out as ready to carry goods for anyone …” (at 402).
His Honour at 401, referring to the Victorian provision, said this:
“The provision will thus cover men who work for the principal but have no independent business or trade and men who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business.”(emphasis added)
It does appear to me that the meaning given by his Honour to the phrase “incidental to” is closer to the fifth definition appearing in the Macquarie Dictionary.
Mahoney JA in Davis however, does in my respectful opinion, clarify the matter in saying at 576 immediately after the reference to Robson:
‘[I]f there was a trade or business, that which was being done was the trade or business itself and, in the relevant sense of the term, what Davis did was not ‘incidental’.”
This passage was referred to with apparent approval by Mason P in QBE Workers Compensation (NSW) Limited v Simaru Pty Limited & Anor [2005] NSWCA 464 at [35].
In a recent case under the Victorian provisions (Kovacic v Henley Arch Pty Ltd [2009] VSCA 56), Ashley JA with whom Warren CJ and Buchanan JA agreed, held that when a bricklayer was injured in lifting a large lintel he was not excluded from the deeming provisions of the Victorian equivalent of Schedule 1 clause 2 because the erection of large lintels was not incidental to the trade of bricklaying. His Honour said the following at [47]:
“The evidence left no doubt that the erection of large lintels was necessary from time to time so that the bricklaying work could be completed. But it does not follow that the erection of large lintels was incidental to the trade of bricklaying. Although the statements made by Messrs Messenger and Van Someren addressed the negligence issue, they made the point, as a side wind, that the erection of the large lintels was not bricklayers’ work at all. Their evidence that such erection should have been performed by a crane, brought on site specifically to do the job, the cost of the crane being factored into the total cost of the home, seems to me to contraindicate performance of that task being incidental to the bricklayers’ work. There is difference between the need for a job to be done so that a contractor can fully perform his work and it being incidental to the contractor’s trade to do that job.”
It appears to me that his Honour was using the word “incidental” in the sense referred to by Dixon J in Humberstone, the fifth meaning of the Macquarie definition, rather than that given in Davis. Special leave to appeal to the High Court was granted on 4 September 2009.
In this case the appellant’s trade or business may be described as gyprocking and the work in the performance of which he was injured was gyprocking. Accordingly it is not “outside the scope or course of that trade or business” (Humberstone at 401). At the same time the work the appellant was performing for Kia was not the trade or business but was part of or incidental to that trade or business, thus, in my view satisfying the test adopted by Mahoney JA in Davis.
QUANTUM OF COMPENSATION
I intended to make findings as to the appropriate rates of weekly compensation payable in the event that my determination of this appeal is later found to be in error. It seems reasonably clear that at all times up to at least the surgery in August last year the appellant has been greatly incapacitated, probably totally incapacitated, and would be entitled to be compensated accordingly. It was common ground that following the surgery carried out in August 2009 that situation may have changed. There is, however, no medical opinion dealing with this. For that reason it was accepted that the matter would have to go back to another Arbitrator if the appeal succeeded in order to make findings in relation to the worker’s incapacity and appropriate weekly compensation after that date.
When the matter was before the Arbitrator she raised the question of the applicable award in relation to the work performed by the appellant and foreshadowed obtaining and forwarding it to the parties with a view to agreement being reached. However, that does not appear to have happened because of the conclusion to which the Arbitrator came.
When the parties were advised of the hearing of the appeal they were notified that they should be in a position to make submissions as to the proper rates of weekly compensation payable, however, when the matter came on for hearing neither party was able to advise me of any appropriate award. Accordingly, the parties were given a further opportunity to reach agreement as to this or failing that to lodge with the Commission a copy of the award or awards said to be applicable. The appellant’s solicitors wrote to the Registrar on 3 February 2010 advising that they had been unable to locate any appropriate award for a gyprocker and no response appears to have been received from those acting for Kia. The appellant advised that he wished to rely on the amount claimed in the Application to Resolve a Dispute, namely $1,500.00 a week as being his weekly earnings prior to injury.
The 1987 Act makes quite specific provision for the calculation of payments in respect of the first 26 weeks of total incapacity (section 36) which refers to the “current weekly wage rate” which is defined in section 42. Those bringing claims for weekly payments of compensation in the Commission ought be quite specific as to the rates of compensation which they claim and it is, in my view, unsatisfactory to claim an amount of $1,500.00 as weekly earnings prior to injury without any reference to the statutory provisions. The position regarding the weekly compensation to which the appellant would be entitled if found to be a deemed worker will, I regret to say, have to be undertaken on a later occasion should that need arise. I would be surprised if there were no award which would be applicable although this may not be under the heading of “gyprocker”, and I would have thought that perhaps some other designation for those performing that work, for example “plasterer” might have led to an appropriate award.
DECISION
The appeal is dismissed. The decision of the Arbitrator is confirmed.
COSTS
Each party is to pay his or its own costs of the appeal.
Anthony Candy
Acting Deputy President
3 March 2010
I, TUYET WALLIS, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ANTHONY CANDY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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