Jafarian v WildFire Interiors Pty Ltd
[2021] NSWPICPD 24
•4 August 2021
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY A MEMBER | |
| CITATION: | Jafarian v WildFire Interiors Pty Ltd [2021] NSWPICPD 24 |
| APPELLANT: | Masoud Jafarian |
| RESPONDENT: | WildFire Interiors Pty Ltd |
| INSURER: | icare Workers Insurance |
| FILE NUMBER: | A1-4845/20 |
| SENIOR MEMBER: | Mr G Capel |
| DATE OF MEMBER’S DECISION: | 8 January 2021 |
| DATE OF APPEAL DECISION: | 4 August 2021 |
| CATCHWORDS: | WORKERS COMPENSATION – worker; whether applicant carried on his own business or whether he was a worker; Malivanek v Ring Group Pty Limited [2014] NSWWCCPD 4 and On Call Interpreters and Translators Agency Pty Ltd v Commissioner of Taxation (No 3) [2011] FCA 366 discussed and applied; s 352 of the Workplace Injury Management and Workers Compensation Act 1998; requirement to show error on appeal |
| PRESIDENTIAL MEMBER: | Acting Deputy President Geoffrey Parker SC |
| HEARING: | On the papers |
| REPRESENTATION: | Appellant: |
| Mr C Tanner, counsel | |
| Turner Freeman Lawyers | |
| Respondent: | |
| Mr P Stockley, counsel | |
| Lee Legal Group | |
| ORDERS MADE ON APPEAL: | 1. The Certificate of Determination dated 8 January 2021 is confirmed. |
INTRODUCTION
The appellant, Masoud Jafarian, alleged that on 15 February 2018 in the course of employment with the respondent, Wildfire Interiors Pty Limited, he fell from a ladder and sustained injury to the cervical and lumbar spine.
He filed an Application to Resolve a Dispute (ARD), in which he claimed medical expenses in the sum of $19,629.70 being the estimated cost of an L5/S1 anterior lumbar interbody fusion.
The insurer declined to authorise the surgery on the grounds that the appellant was not a “worker” within the meaning of s 4 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act). The ARD submitted that the appellant was a deemed worker, however, the arbitration was confined to a claim by the appellant that he was a “worker”.
The arbitration was limited to the following issues:[1]
(a) whether the appellant was a worker in the employ of the respondent on 15February 2018 – s 4 of the 1998 Act;
(b) the respondent’s liability in respect of the payment of medical expenses – s 60 of the Workers Compensation Act 1987 (the 1987 Act), and
(c) whether the surgery proposed by Dr Khong, namely an L5/S1 fusion, and associated expenses is reasonably necessary treatment as a result of the injury arising out of or in the course of the appellant’s employment on 15 February 2018 – s 60 of the 1987 Act.
[1] Jafarian v Wildfire Interiors Pty Ltd [2021] NSWWCC 12 (reasons), [11].
In the event the issues for determination were further refined by the parties as follows:
“It was agreed that submissions would be confined to ‘worker’ issue, and in the event that the [appellant] was successful, the matter would be allocated a telephone conference to deal with the remaining issues.”[2]
[2] Reasons, [12].
The matter came on for arbitration on 22 December 2020.
THE SENIOR ARBITRATOR’S STATEMENT OF REASONS
The facts as found by the Senior Arbitrator are not in dispute. The following is taken from the reasons.
In broad terms, from about July 2017 until his injury on 15 February 2018, the appellant worked as a painter with the respondent at various sites.
The Senior Arbitrator observed the appellant and Mr Rujnic (director of the respondent) were the “only two real persons involved in the arrangement” and each had their own company structure. He reasoned from this that “… reference to one or both of them as individuals in the statements does not necessarily mean that the companies were not involved.”[3]
[3] Reasons, [157].
Mr Rujnic needed additional assistance for a job that he was doing. He received a recommendation favourable to the appellant. He made enquiries about the appellant by checking out his website.[4] (The Senior Arbitrator presumed that this was the website of the appellant’s business, Efficient Handyman Services Pty Ltd (EHS) rather than the appellant as an individual.[5])
[4] Reasons, [219].
[5] Reasons, [158].
The appellant advertised his business names in the yellow and pink pages.
From July 2017 until 15 February 2018, at various times, the appellant worked as a painter with the respondent at different locations.
The price paid for the appellant’s services was $40 per hour plus GST. This was said to be a “higher” rate because the appellant had his own ABN and insurances. The appellant accounted for the GST payment by completing a BAS statement.[6]
[6] Reasons, [160], [164].
When the appellant worked with the respondent, he worked 40 to 48 hours per week, usually Monday to Friday, from 7.00 am to 3.30 pm, and often on Saturdays.
Tax invoices were submitted by the appellant on the letterhead of Efficient Handyman Services Pty Limited, ABN 21 600 582 401. The tax invoices specified the number of hours the appellant work and added GST.
The respondent did not deduct PAYG instalments from the funds deposited into the appellant’s business account. There was no allowance for sick leave or annual leave and there were no superannuation payments made by the respondent.
The appellant had his own workers compensation policy with GIO commencing 31 October 2015, cancelled on 20 July 2018, to take effect from 15 February 2018 because the business ceased to trade.[7]
[7] Reasons, [168].
Each day Mr Rujnic would set up the site for team members. He would provide the paint, equipment and tools. On some occasions the appellant would use his own equipment.
By reference to two calendars, the occasions between July 2017 and January 2018 on which the appellant worked with the respondent were established. The Senior Arbitrator commented that the days worked were less than “one would have expected … if the [appellant] was in fact an employee of the respondent”.[8]
[8] Reasons, [188].
The Senior Arbitrator found that the appellant understated his work activities in the “second statement” (presumably that dated 17 August 2020) and further the Senior Arbitrator found the appellant’s evidence as to work he performed elsewhere was “incorrect and misleading”.[9]
[9] Reasons, [189]–[191].
Contrary to the appellant’s evidence, he was not required to obtain Mr Rujnic’s permission to work for others.
The Senior Arbitrator considered the documentary material showing that the appellant had been registered as a sole trader and obtained ABNs for “Top Quality Painting & Handyman” and for “Efficient Handyman Services”.
The appellant submitted tax invoices that identified EHS as the provider of the services.
The Senior Arbitrator regarded the suggestion that the appellant was an employee as not consistent with the documentary evidence.[10]
[10] Reasons, [200].
The Senior Arbitrator made reference to a number of specific matters, namely:
(a) the tax invoices that were submitted to the respondent included a business ABN and a business logo;[11]
[11] Reasons, [201].
(b) GST is only charged if a party was registered for GST and is not payable in an employer/employee situation;[12]
(c) it was “an extremely odd coincidence” that the only tax invoice to exclude GST was that dated 16 February 2018, the day after the appellant’s injury;[13]
(d) the appellant issued similar invoices, ie on EHS’s letterhead, to other clients namely, “Opal Painting/Talgat”, “Caleb/Julie”, and “Rob”;
(e) all payments were made into the EHS business account not the appellant’s personal Westpac Choice or eSaver accounts;[14]
(f) the appellant’s personal and business tax returns were combined and identified the business name of Efficient Handyman Services and included the appellant’s ABN;
(g) the Senior Arbitrator found that the declared income of $21,154 was “arguably” profit;[15]
(h) the appellant claimed expenses of $12,889 which the Senior Arbitrator found to be well above the normal expenses usually claimed by an employee,[16] and
(i) the Senior Arbitrator said this in relation to the tax return tax estimate:
“In the tax return tax estimate, there were PAYG instalment deductions of $3,066. This has not been explained by the [appellant]. The Notice of Assessment indicated that this figure was notified in the BAS statements, but that is not consistent with the BAS statement that is in evidence. It could perhaps relate to income earned by the [appellant] as a sole trader, and there might be other BAS statements in respect of his sole trader business, but they are not in evidence. There is no explanation provided by the [appellant].”[17]
[12] Reasons, [202].
[13] Reasons, [203].
[14] Reasons, [204].
[15] Reasons, [206].
[16] Reasons, [208].
[17] Reasons, [209].
The manner of calculating remuneration, PAYG tax, superannuation and insurance tended to support “the respondent’s claim that the [appellant’s] company was engaged to provide painting services as an independent contractor, rather than the [appellant] being employed as an individual.”[18]
[18] Reasons, [170].
It was significant to the Senior Arbitrator that the appellant “did not mention the deregistration of his company in his statements. The reasons why the company was deregistered are unknown. Further, the [appellant] did not explain why he continued to issue tax invoices in the business’ name.”[19]
[19] Reasons, [211].
Efficient Handyman Services Pty Limited was deregistered on 3 December 2017. The ABN status was cancelled on 24 April 2018 and its GST registration was cancelled on 13February 2018.[20]
[20] Reasons, [34].
The Senior Arbitrator found that the respondent continued to deal with the deregistered company “but it is clear that the [appellant] misrepresented the situation.”[21]
[21] Reasons, [211].
Mr Rujnic was unaware that EHS had been deregistered.[22] It was found that the appellant had not informed the respondent this had occurred.
[22] Reasons, [210].
The appellant said he was not entitled to delegate work to others. The Senior Arbitrator declined to draw any conclusion with respect to this indicium but accepted that Mr Rujnic expected the appellant to do the work personally.[23]
[23] Reasons, [183].
The Senior Arbitrator accepted that “it could not be said that the [appellant] was not required to provide an outcome for the respondent”.[24] But he found, that “the [appellant] was the business contact, and the business was engaged to paint offices. As far as his dealings with the respondent were concerned, the [appellant] was a [re]presentative of his business, EHS, and this is consistent with him being an entrepreneur associated with his business.”[25]
[24] Reasons, [215].
[25] Reasons, [216].
There was little evidence as to the appellant’s tangible and intangible assets. The appellant had a vehicle which he claimed as a business expense, there was evidence of regular purchase of items from Bunnings and he charged Hornsby RSL for materials, tools and paint, so the Senior Arbitrator inferred that the appellant had some painting equipment.
The parties directed the Senior Arbitrator’s attention to Malivanek v Ring Group Pty Limited[26] and to the citation in that decision of the decision of Bromberg J in On Call Interpreters and Translators Agency Pty Ltd v Commissioner of Taxation (No 3).[27]
[26] [2014] NSWWCCPD 4; 15 DDCR 146 (Malivanek).
[27] [2011] FCA 366 (On Call Interpreters).
From these authorities the Senior Arbitrator directed himself in the following terms:
“… in order to assess the nature of the relationship between the [appellant] and the respondent, I need to consider the various indicia, look at the totality of the relationship and analyse the evidence before me. For the most part, the evidence consists of the statements, invoices and tax returns.”[28]
[28] Reasons, [151].
The Senior Arbitrator considered the issue of “control” and the right to dictate the place and hours of work, quoting from the decision of the High Court in Zuijs v Wirth Brothers Pty Limited.[29] He found that the evidence disclosed minimal, if any, control over the appellant’s activities but that this was not determinative.[30]
[29] [1955] HCA 73; 93 CLR 561, 571.
[30] Reasons, [180].
It was significant that the appellant did not work exclusively for the respondent because this was not consistent with an employer/employee relationship.[31]
[31] Reasons, [193].
The Senior Arbitrator’s conclusion was that the respondent contracted with EHS.[32]
[32] Reasons, [212].
The Senior Arbitrator expressed his conclusions in the following terms:
“220. Each case must be considered on its own facts. No two matters are strictly identical as there will nearly always be some variants. Having regard to the principles referred to in Malivanek and On Call Interpreters, the critical question is whether the [appellant] was working in the respondent’s business or in his own. The fact that the [appellant] worked elsewhere and submitted similar tax invoices is irrelevant, although it has some bearing on the indicium of exclusivity.
…
222. There is a great deal of evidence that suggests that the [appellant] was in fact conducting a trade or business in his own name. I have identified this evidence above, such as the tax invoices containing the business ABN, business address and inclusion of GST, the lack of exclusivity, the lack of the provision of statutory entitlements, superannuation payments and PAYG tax deductions, the claims for business deductions, the agreed rate of pay, the business website and the advertisements, the absence of employees, and a worker’s compensation policy that only covered one person, namely the [appellant].
…
225. As discussed by the Deputy President in Malivanek, the focal point is whether the [appellant] was working in the business of respondent or in his own business. Having regard to the evidence and a consideration of the ‘totality of the relationship’ in accordance with Hollis, I am satisfied on the balance of probabilities that the [appellant] was in fact undertaking work that was incidental to a trade or business regularly carried out by him for his company at the time that he sustained injury on 15 February 2018.
226. Further, I am satisfied that the [appellant] satisfies the ‘practical test’ discussed by Bromberg J in On Call Interpreters, namely that the [appellant] was an entrepreneur who owned and operated a business and in performing the work, he was working in and for his business as a representative of that business, rather than in and for the respondent’s business. Accordingly, there will be an award for the respondent.”
The Senior Arbitrator concluded: “The [appellant] was not a ‘worker’ in the employ of the respondent within the meaning of s 4 of the 1998 Act as at 15 February 2018.”[33]
[33] Reasons, [227].
CERTIFICATE OF DETERMINATION
Pursuant to s 294 of the 1998 Act the Commission determined:
“1. The [appellant] was not a ‘worker’ in the employ of the respondent within the meaning of section 4 of the Workplace Injury Management and Workers Compensation Act1998 as at 15 February 2018.
The Commission orders:
2. There will be an award for the respondent.”
The Certificate of Determination is dated 8 January 2021.
GROUNDS OF APPEAL AND PROCEDURAL ISSUES
The Appeal Against a Decision of an Arbitrator sets out the following three grounds of appeal:
(a) Ground 1 – The Senior Arbitrator made an error of mixed fact and law in failing to find that the appellant was a worker within the meaning of s 4 of the 1998 Act having regard to the evidence before him and the principles set out in On Call Interpreters;
(b) Ground 2 – The Senior Arbitrator made an error of mixed fact and law in treating one formal aspect of the relationship between the appellant and the respondent, the presentation of invoices issued in the name of the appellant’s company, as decisive and failing to recognise that the work that was being performed by the appellant at the time of his injury was as a subordinate worker performing duties under the control of and in the business of the respondent, and as a representative of that business, not as an independent entrepreneur performing work for his own business, and as a representative of that business, and
(c) Ground 3 – The Senior Arbitrator made an error of mixed fact and law in treating the fact that the appellant had a business as decisive of the question as to whether the appellant was a worker without examining whether notwithstanding that the appellant had a business he was at the material time performing work for the respondent.
The respondent filed a Notice of Opposition to Appeal Against a Decision of an Arbitrator dated 15 March 2021. In addition, the respondent filed a Notice of Contention.
The appellant did not file submissions in reply. The appellant noted that he may seek leave to lodge additional submissions upon receipt of the typed transcript. No application for leave has been filed and no additional submissions lodged.
The appellant has not filed submissions in response to the Notice of Contention and no explanation for the absence of such submissions has been received. In any event it is unnecessary for me to determine the Notice of Contention.
ON THE PAPERS
Section 52(3) of the Personal Injury Commission Act2020 (the 2020 Act) provides:
“If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act and enabling legislation without holding any conference or formal hearing.”
The appellant and the respondent each submit that the appeal can be decided solely on the basis of the written materials.
The Procedural Directions PIC2 and WC3 provide that I may be satisfied on the documents before me and the submissions of the parties that the appeal can be determined on the basis of the documents. I am satisfied that I have sufficient material to proceed “on the papers” without holding any conference or formal hearing and that this is an appropriate course in the circumstances of this matter.
THRESHOLD MATTERS: SECTIONS 352(3) AND (4) OF THE 1998 ACT
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the 1998 Act have been met.
THE NATURE OF APPEAL PURSUANT TO SECTION 352(5) OF THE 1998 ACT
Section 352(5) provides:
“An appeal under this section is limited to a determination of whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”
I will refer to the relevant principles applicable to appeals under s 352(5) in the disposition of Ground 1 of the appeal.
TRANSFER OF THE MATTER FROM THE WORKERS COMPENSATION COMMISSION TO THE PERSONAL INJURY COMMISSION
The appeal was registered with the Workers Compensation Commission. The Workers Compensation Commission was abolished and replaced by the Workers Compensation Division of the Personal Injury Commission by operation of the 2020 Act from 1 March 2020.[34]
[34] Clause 12(1) of Division 2.3 of Part 2 of the 2020 Act.
The 2020 Act amended the 1998 Act such that the arbitrators of the former Workers Compensation Commission became non-presidential members of the Personal Injury Commission. The amendments allow for appeals from decisions of the members of the Personal Injury Commission to a Presidential member of the Workers Compensation Division of the Personal Injury Commission in accordance with s 352 of the 1998 Act.
GROUNDS OF APPEAL
Ground 1
Appellant’s submissions
The appellant has provided extensive submissions. I intend no discourtesy in the abbreviated summary which I provide.
The appellant quotes extensively from Mr Rujnic’s statement, paragraphs [21], [28], [30]–[37], for the conclusion that the working arrangement was between the appellant personally and Mr Rujnic.
The appellant submits the evidence of Mr Rujnic was that he needed to take on another worker and contacted Mr Talgat, another painter, to ask if he could recommend anyone. The recommendation was for a person not a company or business, Mr Rujnic did not intend to subcontract part of the work to another business. It appeared that the appellant had worked for Mr Talgat, not that Mr Talgat had engaged the appellant’s business. The recommendation was not to the appellant’s business, but to the appellant personally.
The fact that the appellant had his own “Pty Limited” company was an incidental feature relevant to the appellant’s rate of pay but not otherwise. Mr Rujnic does not explain what other relevance the appellant’s company may have had to him. Mr Rujnic does not state that he entered into negotiation with the appellant’s company nor provide any details of a contract between the respondent and the appellant’s company.
The appellant submits that the “daily labour” fixed rate of remuneration within fixed hours “cannot plausibly be dressed up as the entrepreneurial activity of a businessman.”[35]
[35] Appellant’s submissions, [20].
The appellant refers to the submissions made on his behalf before the Senior Arbitrator and the reference to the decision of On Call Interpreters. Relying on that case, the appellant submits that the “question of whether ‘a person is an employee or alternatively an independent contractor is to be answered by reference to an objective assessment of the nature of the relationship that person has with the entity that takes the benefit of that person’s work.’” (with emphasis added in the submission)
Referring further to On Call Interpreters, the appellant says that although the appellant did have a business, the issue as to the status of his relationship with the respondent turns on the answer to the second question posed by Bromberg J in On Call Interpreters.[36]
[36] Appellant’s submissions, [30].
As to that the appellant submits that the economic activity that is the focus of the examination is the economic activity provided by the person performing the work to the entity receiving the work.
In this case the economic activity upon which to focus is the performance of painting work by the appellant for the respondent.[37]
[37] Appellant’s submissions, [32].
The appellant submits:
“A reading of the [Senior] Arbitrator’s decision reveals that that focus was not maintained, and that the [Senior] Arbitrator’s decision was clouded by reference to other economic activity in which the appellant engaged, involving other entities.
Maintaining the necessary focus upon the appellant’s engagement with the respondent, there can be no suggestion that that economic activity provided any opportunity for profit and involved the risk of loss. The appellant did not incur expenses in respect of the activity in which he engaged with the respondent, and did not derive an income which entailed either a surplus over expenses (i.e. profit) or a deficit (i.e. loss).”[38]
[38] Appellant’s submissions, [33]–[34].
The appellant submits:
(a) The appellant did not control or direct the manner in which the economic activity, the painting work, was performed by the appellant for the respondent. Mr Rujnic was the appellant’s direct supervisor.
(b) There is no entrepreneurial independence applied to the work in which the appellant was engaged when working for the respondent. Entrepreneurs do not work under the direct supervision of a customer.[39]
[39] Appellant’s submissions, [42]–[48].
(c) The appellant worked in a team of painters and the appellant’s work could not be distinguished from the work of the team and conceived as separate economic activity representing his business as distinct from representing the respondent’s business.[40]
(d) The appellant was integrated into the respondent’s business activity.[41]
(e) Although the appellant was not exclusively dependent upon the respondent because workers can have more than one job, the fact that he had a business did not mean that all of the work performed by the appellant was done in his capacity as an entrepreneur. Each relationship needs to be examined objectively on its merits.
(f) The appellant may well have engaged in economic activities with his own customers, involving the opportunity for profit and the risk of loss, in the conduct of his own business, but that cannot alter the true character of his relationship with the respondent.[42]
(g) There is no evidence that the appellant was free to employ his own means to produce the activity.[43]
(h) The economic activity enhanced the respondent’s business reputation in the market and did not generate any independent goodwill for the appellant himself.[44]
(i) There is no evidence that the appellant agreed to provide any outcome or result or that Mr Rujnic engaged the appellant on that basis.
(j) The respondent provided the necessary equipment and materials which were available and ready for the appellant to use when he arrived at work.[45]
(k) The appellant was subject to the direction and supervision of Mr Rujnic.
(l) The characterisation of the relationship as “owner/entrepreneur” is limited to the manner in which the appellant was paid for his work. But that formal aspect cannot “alter the inherent character of the relations they have actually called into existence.”[46]
[40] Appellant’s submissions, [50].
[41] Appellant’s submissions, [52].
[42] Appellant’s submissions, [59].
[43] Appellant’s submissions, [61].
[44] Appellant’s submissions, [52].
[45] Appellant’s submissions, [64]–[66].
[46] Appellant’s submissions, [68]–[69].
The appellant concludes his submission in support of Ground 1 of the appeal with:
“70. Any independent observer, noting the activities of the appellant each day, as a member of Mr Rujnic’s team, and working under the direct supervision of Mr Rujnic would conclude that the appellant was working for the respondent, not conducting his own business when engaged in that activity.
71. The [Senior] Arbitrator, in finding that the appellant was not a worker, lost sight of the principal enquiry he was required to make, ie at the time of injury, was the appellant working in and for his own business as a representative of that business, or for the business receiving the work and as a representative of that business.
72. The [Senior] Arbitrator failed to address that question and the series of questions posed by Justice Bromberg at [218] of the On Call [Interpreters] decision and discussed above …
73. The evidence clearly demonstrates that the [appellant] was working in and for the business of the respondent at the material time, as a representative of that business, not in and for his own business.”
Respondent’s submissions
The respondent submits that s 352(5) of the 1998 Act requires that the determination of the appeal “should be directed to the identification of error and, if found, its correction.”[47]
[47] Respondent’s submissions, [1].
The respondent further submits:
“That said, the ground itself says that the ultimate issue, namely whether or not the appellant was a worker within the meaning of s 4 of the 1987 [Act] was wrongly decided. This does little more than identify the appellant’s complaint that the decision went against him. This criticism is not dissimilar to the observations of Roche DP in [Malivanek] at [99].
It is submitted that the appellant’s submissions do not identify error on the part of the Senior Arbitrator or provide submissions directed to that part of the Senior Arbitrator’s reasons said to be deficient to the point that an error occurred. “The submissions for the most part re-present the case at first instance”.[48]
[48] Respondent’s submissions, [5]–[7].
The respondent submits that the only submission that might be directed to identification of error is that contained at paragraph [71] of the appellant’s submissions, where it was submitted that the Senior Arbitrator lost sight of the principal enquiry he was required to make at the time of the hearing. At [72] it was said that the Senior Arbitrator failed to address the questions posed by Bromberg J at [218] of On Call Interpreters. In answer the respondent submits:
(a) The appellant’s submission at [71] assumes there was a “principal enquiry” to be made.
(b) The Senior Arbitrator understood and acknowledged that Justice Bromberg’s decision was part of the line of authority identifying the relevant indicia of employment that had been considered and adopted by the Workers Compensation Commission.
The respondent submits that the Senior Arbitrator acknowledged the focal point around which one examines the indicia is whether the appellant is working in the business of another or in the business of the appellant and at [225] of the reasons, he recorded this as precisely the approach he took. This is not the principal enquiry as the appellant might characterise it, but the ultimate or penultimate issue to be borne in mind when weighing the indicia.[49]
[49] Respondent’s submissions, [13].
The respondent’s final submission is that the relevant exercise is an evaluative one dependent on questions of fact and degree upon which minds may legitimately differ.[50]
[50] Respondent’s submissions, [15].
Consideration
The jurisdiction provided by s 352(5) permits correction of the decision at first instance to the extent that it “was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”[51]
[51] Section 352(5) of the 1998 Act.
The ambit of the jurisdiction is accurately described by Roche DP in Raulston v Toll Pty Limited[52] where at [17]–[30] the Deputy President set out in detail the appellate jurisdiction conferred by s 352(5). The Deputy President said at [19]:
“First, as error now defines the appeal process under s 352, the following principles stated by Barwick CJ in Whiteley Muir & Zwanenberg Ltd v Kerr (1966) 39 ALJR 505 at 506 (cited with approval by Brennan CJ, Toohey, McHugh, Gummow and Kirby JJ in Zuvela v Cosmarnan Concrete Pty Ltd [1996] HCA 140; 140 ALR 227) are relevant (I have substituted ‘Arbitrator’ for ‘trial judge’ where appropriate):
(a) An Arbitrator, though not basing his or her findings on credit, may have preferred one view of the primary facts to another as being more probable. Such a finding may only be disturbed by a Presidential member if ‘other probabilities so outweigh that chosen by the [Arbitrator] that it can be said that his [or her] conclusion was wrong’.
(b) Having found the primary facts, the Arbitrator may draw a particular inference from them. Even here the ‘fact of the [Arbitrator’s] decision must be displaced’. It is not enough that the Presidential member would have drawn a different inference. It must be shown that the Arbitrator was wrong.
(c) It may be shown that an Arbitrator was wrong ‘by showing that material facts have been overlooked, or given undue or too little weight in deciding the inference to be drawn: or the available inference in the opposite sense to that chosen by the [Arbitrator] is so preponderant in the opinion of the appellate court that the [Arbitrator’s] decision is wrong.’”
[52] [2011] NSWWCCPD 25; 10 DDRCR 156.
In Northern NSW Local Health Network v Heggie[53] Sackville AJA said:
“A fortiori, if a statutory right of appeal requires a demonstration that the decision appealed against was affected by error, the appellate tribunal is not entitled to interfere with the decision on the ground that it thinks that a different outcome is preferable: see Norbis v Norbis [1986] HCA 17; 161 CLR 513, at 518-519, per Mason and Deane JJ.”
[53] [2013] NSWCA 255; 12 DDCR 95, [72].
In Australian Air Express Pty Limited v Langford[54] McColl JA (with the agreement of Ipp and Tobias JJA) said:
“14. Before turning to the three factors upon which the primary judge appears to have placed greatest weight, some preliminary observations should be made.
15. The first concerns the approach an appellate court should take to reviewing an exercise whose resolution is ‘one of ‘fact and degree’ in respect of which views might legitimately differ’: Roy Morgan Research Limited v Commissioner of State Revenue (1997) 37 ATR 528 at 533. In such a case it is not enough that an appellate court might have come to a different conclusion - before an appellate court will intervene the appellant must show error on the part of the primary judge: JA & BM Bowden & Sons Pty Limited v Chief Commissioner of State Revenue (2001) NSWCA 125; (2001) 105 IR 66 at 68 [14] per Ipp JA.
16. The second observation concerns the distinction between an employee and an independent contractor. That distinction has been said to be ‘rooted fundamentally in the difference between a person who serves his employer in his, the employer’s business, and a person who carries on a trade or business of his own’: Marshall v Whittaker’s Building Supply Co [1963] HCA 49; (1963) 109 CLR 210 at 217 per Windeyer J. Although this statement was criticised by Wilson and Dawson JJ in Stevens (at 34) as ‘posing the ultimate question in a different way rather than offering a definition which could be applied for the purpose of providing an answer’, it was referred to with approval by the majority in Hollis (at 38–39 [39]–[40]).”
[54] [2005] NSWCA 96.
I conclude this reference to authority with the comments of Roche DP in Malivanek from the passage referred to by the respondent at paragraph [99], namely:
“The above ‘grounds’ did not comply with Practice Direction No 6. They merely complained that the Arbitrator erred in not finding in Mr Malivanek’s favour. They did not properly identify how the Arbitrator erred. Given the number of times this has been raised in Presidential decisions, that was most unsatisfactory.”
In my view, the approach adopted by the appellant in relation to Ground 1 does not identify error of fact, law or discretion on the part of the Senior Arbitrator, much less does it advance submissions demonstrating such an error. The formulation of Ground 1 on its terms does nothing more than indicate the appellant’s dissatisfaction with the outcome achieved in the hearing before the Senior Arbitrator.
The assertion of a contrary view with respect to any piece of evidence does not establish that the Senior Arbitrator was incorrect to take the view that he took. This is particularly the case in matters such as the present where the individual items of evidence give rise to different views and where the ultimate conclusion is derived from the Senior Arbitrator’s assessment of the evidence as a totality.
It is to be expected in an appeal such as the present that the appellant will identify specific conclusions or propositions or findings of the Senior Arbitrator in relation to fact, legal principle or discretion that cannot be supported by reference to specific evidence, legal principle or the consideration of relevant matters.
The appellant’s engagement by the respondent, to use a neutral expression, involved elements that could reasonably be relied upon in support of the proposition that the relationship was one of employment. The statement evidence as to Mr Rujnic’s need for another worker and the evidence of the appellant that he needed work, as it were to tide him over between jobs, the integration of the appellant into the “team” of painters point towards the relationship being one of employment. But there were matters against such a conclusion as outlined by the Senior Arbitrator in his decision at paragraphs [220]–[226].
The appellant asserts that the Senior Arbitrator was wrong in relation to the findings and inferences that he drew from this material. But the appellant does not identify in Ground 1, so far as I can see, any factual conclusion which is disputed. The appellant is left with an argument that the facts as found by the Senior Arbitrator, which are essentially unchallenged, do not support the conclusion that he drew that the appellant was not a worker. The appellant was required to displace the Senior Arbitrator’s conclusion. It was not enough to show that a different inferential conclusion was available on the same factual findings.
I am not persuaded that the appellant has identified or established error of fact, law or discretion such as to enliven the appellate jurisdiction. Furthermore, I am not persuaded that the Senior Arbitrator did not address adequately the relevant legal principles in his determination adverse to the appellant. In my view, none of the matters complained of under Ground 1 in the submissions could be advanced any higher than matters in which minds could differ as to the conclusion.
In the circumstances, Ground 1 of the appeal is rejected.
Ground 2
Appellant’s submissions
The appellant submits that the Senior Arbitrator correctly noted that the substance of the arrangement was that the appellant would undertake painting for the respondent at an agreed hourly rate. He further submits that it was not an arrangement for the provision of services by Efficient Handyman Services Pty Limited.
Further it is submitted that the Senior Arbitrator failed to engage with the “focal point” around which one examines the indicia, namely, whether the appellant is working for the business of another or in the business of the appellant.
The discussion of the various indicia in the reasons at paragraphs [152]–[219] purporting to answer “the critical question … whether the [appellant] was working for the respondent on 15 February 2018” did not properly engage with the focal point identified by Bromberg J and endorsed by Roche DP.[55] At [107]–[112] of the appellant’s submissions, the appellant agitates each of the issues addressed as indicia.
[55] Appellant’s submissions, [79].
The appellant asserts that notwithstanding that the Senior Arbitrator identified the question at [220] of the reasons, he failed to address it.[56]
[56] Appellant’s submissions, [108].
The appellant submits:
“The [Senior] Arbitrator, in acknowledging that the fact that ‘the appellant worked elsewhere and submitted similar tax invoices is irrelevant’, would seem to have appreciated that the other activities of the appellant were not determinative of the nature of his relationship with the respondent.”[57]
[57] Appellant’s submissions, [109].
Further, the passage at [222] of the reasons indicates that the Senior Arbitrator treated the existence of the appellant’s own business and the formalities associated with that business as decisive without examining the true nature of the appellant’s relationship with the respondent.[58] The appellant concludes:
“The [Senior] Arbitrator simply failed to conduct the necessary and separate enquiry that needed to be made in order to ascertain whether, having regard to the economic activity he was performing for the respondent, he was working in and for that business, and as representative of it.”[59]
[58] Appellant’s submissions, [111].
[59] Appellant’s submissions, [112].
Respondent’s submissions
The respondent says that Ground 2 appears to overlap with Ground 3 to some extent. Ground 2 attacks the Senior Arbitrator’s consideration of the presentation of invoices and Ground 3 attacks his consideration of the existence of the appellant’s business (evidenced in part by the self-same invoices).
The respondent accepts that the treating of one aspect of the relationship or one of the relevant indicia as decisive has the potential to constitute error, particularly if other relevant indicia are ignored.
It says that the Senior Arbitrator’s reasons at [222] must be considered in context. It is apparent from the reasons at [224] that the Senior Arbitrator in fact rejected the proposition that the substance of the relationship should be examined without regard to the documentary evidence.
The respondent’s submission is that it cannot have constituted an error to give consideration to the documentary evidence in his assessment. That is what the Senior Arbitrator quite properly did.
A reading of the balance of the reasons makes it clear that he also evaluated and weighed the other evidence and indicia in coming to a conclusion on questions of fact and degree.
Under the heading of Ground 3, the respondent also submits that in the circumstances where the appellant was the proprietor of a business conducting the same activity (painting) upon which he was engaged with the respondent at the time of the injury, the existence and nature of that business becomes a relevant consideration. The question arises as to whether his activity at the time of the injury was simply an incident of the business he normally conducted, or whether that activity could be distinguished in some way so as to show that he was conducting himself as an employee of the respondent. If, for example, the appellant had not conducted a painting business at all, the inference or conclusion that he was acting on his own account at the time of injury would be less strong.
The Senior Arbitrator was obliged to give due consideration to the appellant’s business when assessing the indicia of employment and that is what he did.
If the focal point is whether the appellant was working in the business of another or in his own business as posed by Roche DP in Malivanek and recorded by the Senior Arbitrator as part of his conclusion at [225] of the reasons, consideration of the existence and nature of the appellant’s own business was critical.
The respondent submits there was an absence of evidence to differentiate his mode of conducting his painting business from the work he was performing at the time of the injury. The evidentiary support for his case was limited and ultimately insufficient to discharge his onus. The respondent refers to the reasons at [221] for support for that proposition.
Consideration
This ground of appeal is differently expressed in the Application to Appeal when compared to the heading to the appellant’s submissions. The former used the words “treated the form of the relationship” whereas the latter refers to “treating one formal aspect of the relationship”. I have adopted above the words used in the heading to the submissions as reflecting the appellant’s complaint.
It is not correct to assert, as this ground of appeal seeks to assert, that the Senior Arbitrator focused on one formal aspect of the arrangement concerning the presentation of invoices in the company name.
So far as I can see, the appellant does not challenge any of the factual conclusions reached by the Senior Arbitrator. The appellant challenges the inference(s) drawn by the Senior Arbitrator from now uncontested factual findings. But it was in fact the case that it was the appellant’s company that invoiced the respondent’s company for the appellant’s services.
I do not see in the Senior Arbitrator’s consideration of the evidence and his conclusions a failure to address the issue of whether the appellant was working in his own business or working in the business of the respondent.
In my view, the conclusion reached by the Senior Arbitrator was in essence that the appellant conducted a painting business and that when he was engaged by the respondent in July 2017 that was a manifestation of the painting business.
It is not correct, in my view, that the Senior Arbitrator treated any particular matter as decisive. The Senior Arbitrator had in mind the various indicia identified in the relevant authorities. The Senior Arbitrator rejected the appellant’s submission that the documentary evidence should be ignored and the alleged “substance” of the arrangement considered. How the parties’ arrangement operated in practice reflected its substance. One aspect of how the arrangement operated was the method of invoicing adopted by the appellant.
The appellant does not engage with the Senior Arbitrator’s rejection of the submission at the hearing that the documentary evidence was not relevant and that the focus should be on the substance of the arrangement between the appellant and the respondent. Consideration of the substance of the relationship necessarily included consideration of the documentary evidence. The Senior Arbitrator was correct at [224] of the reasons when he observed that if he failed to take the documentary evidence into account he would be in error.
The Senior Arbitrator said there was disagreement regarding he appellant’s ability to accept or refuse work, the level of control over the tasks to be done, and the provision of tools and paint. The absence of evidence persuasively in favour of the appellant with respect to these matters may not have been determinative but its absence weakened his claim to be a worker.
The appellant does not demonstrate that the Senior Arbitrator treated as decisive the presentation of invoices issued in the name of the appellant’s company. Furthermore, the appellant does not demonstrate why the following conclusions on the part of the Senior Arbitrator were not justified on the evidence:
“The [appellant] provided painting services to the respondent, who entered into contracts with clients. The respondent was required to provide an outcome for the client, but it could not be said that the [appellant] was not required to provide an outcome for the respondent. (emphasis added)
Whether the [appellant] was conducting work for someone else is irrelevant, as we are concerned with the contract and the relationship that existed between the [appellant] and the respondent. The [appellant] was the business contact, and the business was engaged to paint offices. As far as his dealings with the respondent were concerned, the [appellant] was a presentative of his business, EHS, and this is consistent with him being an entrepreneur associated with his business.”[60]
[60] Reasons, [215]–[216].
In my view, the appellant has not shown error or that the Senior Arbitrator allowed any particular factor to be decisive in his determination that the appellant was conducting his own business when he provided his services to the respondent on 15 February 2018. Much less has it been demonstrated that he treated the presentation of invoices issued in the name of the appellant’s company, as decisive.
Furthermore, I do not agree that the Senior Arbitrator failed to recognise that the work that was being performed by the appellant at the time of his injury, was as a subordinate worker performing duties under the control of and in the business of the respondent. It was open to the Senior Arbitrator on the evidence to conclude as he did that the appellant’s services were provided to the respondent as a representative of the appellant’s business, EHS.
The appellant has not made good this ground of appeal.
Ground 2 of the appeal is not made out and is rejected.
Ground 3
Appellant’s Submissions
The appellant makes the same submissions in respect of this ground as he made at [58], [99], [104]–[107], [111]–[112] of his submissions.
Respondent’s Submissions
The respondent has made submissions in respect to Ground 3 referred to above.
Consideration
For the reasons given in relation to Ground 2, in my view the Senior Arbitrator did not treat as decisive the fact that the appellant had his own painting business.
The Senior Arbitrator said at [225]:
“As discussed by the Deputy President in Malivanek, the focal point is whether the [appellant] was working in the business of respondent or in his own business. Having regard to the evidence and a consideration of the ‘totality of the relationship’ in accordance with Hollis, I am satisfied on the balance of probabilities that the [appellant] was in fact undertaking work that was incidental to a trade or business regularly carried out by him for his company at the time that he sustained injury on 15 February 2018.”
The Senior Arbitrator did not regard the fact that the appellant had his own business as decisive. On several occasions he made the point that the arrangement between the appellant and others apart from the respondent was irrelevant to the matter.[61]
[61] See Reasons, [216].
The Senior Arbitrator was aware of the distinction between the appellant’s business and the proposition that the appellant sought to establish in the proceedings, namely that he was on this occasion on 15 February 2018 a worker employed by the respondent. Contrary to the appellant’s submissions at trial and now, the totality of the evidence, including the documentary evidence adumbrated at [222] of the reasons and the unproven matters mentioned at [221] of the reasons concerning the nature of the work, led the Senior Arbitrator to the conclusion on the balance of probabilities that the appellant was not a worker on 15 February 2018. I am not persuaded that the Senior Arbitrator was in error so to conclude.
Ground 3 of the appeal is dismissed.
Notice of Contention
The respondent has filed a Notice of Contention in which it contends that the appellant failed to establish the formation or existence of a contract between himself and the respondent.
It is unnecessary for the disposition of the appeal that I determine the Notice of Contention. As previously noted, the Commission has not received any submissions from the appellant on the Notice of Contention. Had the appeal depended on a determination of the Notice of Contention I would have issued a Direction intended to elicit the from the appellant an indication as to whether the absence of submission(s) with respect to the Notice of Contention was intended or through oversight. However, as the appeal can be determined without determining the Notice of Contention, this is unnecessary.
CONCLUSION
For the above reasons, the appellant has failed to demonstrate error within the meaning of s 352(5) of the 1998 Act. The appeal is dismissed. It is unnecessary in the circumstances to determine the Notice of Contention.
DECISION
The Senior Arbitrator’s Certificate of Determination is confirmed.
Geoffrey Parker SC
ACTING DEPUTY PRESIDENT
4 August 2021
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