Merrick v Aaron John Shelley and Geoffrey David Swan trading as Nationwide Transport Solutions and Workers Compensation Nominal Insurer

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Merrick v Aaron John Shelley and Geoffrey David Swan trading as Nationwide Transport Solutions and Workers Compensation Nominal Insurer [2010] NSWWCCPD 106
APPELLANT:		Joseph Merrick
FIRST RESPONDENTS:		Aaron John Shelley and Geoffrey David Swan trading as Nationwide Transport Solutions
SECOND RESPONDENT:		Workers Compensation Nominal Insurer
FILE NUMBER:		A1-1752/10
ARBITRATOR:	Mr Robert Foggo
DATE OF ARBITRATOR’S DECISION:		21 June 2010
DATE OF APPEAL DECISION:		30 September 2010
SUBJECT MATTER OF DECISION:		Section 9AA of the Workers Compensation Act 1987, principal place of business; burden of proof
PRESIDENTIAL MEMBER:		Deputy President Kevin O’Grady
HEARING:		On the papers
REPRESENTATION:		Appellant:	Bale Boshev Lawyers
First Respondents:		Kells The Lawyers
Second Respondent:		Sparke Helmore
ORDERS MADE ON APPEAL:		The decision of the Arbitrator dated 21 June 2010 is confirmed. No order as to costs of this appeal.

BACKGROUND TO THE APPEAL

Joseph Lance Merrick, who is 57 years of age, was employed by Aaron John Shelley and Geoffrey David Swan trading as Nationwide Transport Solutions (the employers) as an interstate truck driver. Mr Merrick alleged that he received injury in the course of that employment in April 2006. He remained so employed until 5 May 2006. Thereafter he made a claim in respect of workers compensation benefits against WorkCover Queensland. Following investigation conducted by WorkCover Queensland he was informed that his claim had been accepted by that organisation. It appears that Mr Merrick received payment of weekly compensation from WorkCover Queensland up until a date in November 2007.
On 14 November 2008 correspondence was forwarded to the employers (at that time incorrectly named as Nationwide Transport Solutions Pty Limited) by Mr Merrick’s solicitors giving notice of “a claim for compensation in New South Wales”. It was established that the employers were not the holders of a policy of insurance in respect of liability under the New South Wales workers compensation legislation. Correspondence dated 15 January 2009 was forwarded to the claims manager, Uninsured Liability and Indemnity Scheme, WorkCover NSW giving notice of Mr Merrick’s claim in respect of compensation benefits as prescribed by the New South Wales legislation.
Liability was disputed by WorkCover NSW and notice of that dispute was forwarded to Mr Merrick’s solicitors in correspondence dated 27 February 2009. That notice was given in accordance with the provisions of s 74 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act). The basis of the denial of liability was particularised as being the provisions of s 9AA(3)(a) and (b) of the Workers Compensation Act 1987 (the 1987 Act). It was stated that compensation was not payable as Mr Merrick’s employment was not connected with the State of New South Wales.
The dispute concerning Mr Merrick’s entitlement to compensation benefits as prescribed by the relevant New South Wales legislation was the subject of an application to resolve a dispute filed with the Commission in 2009 (matter 4628/09). It appears that those proceedings were commenced against WorkCover Authority of NSW and an unincorporated entity. The proceedings were discontinued by Mr Merrick.
On 5 March 2010 Mr Merrick registered a further application to resolve a dispute with the Commission. The respondents to that application were the employers and the Workers Compensation Nominal Insurer (the Nominal Insurer). That application, at the time of registration, sought orders with respect to a continuing award of weekly benefits dating from 14 April 2006. No other relief was sought.
Mr Merrick’s application came before an Arbitrator for conciliation/arbitration on 4 June 2010. The matter proceeded to hearing following which the Arbitrator reserved his determination.
A Certificate of Determination issued on 21 June 2010 which was accompanied by a statement of the Arbitrator’s reasons for decision (Reasons).

THE DECISION UNDER REVIEW

The Certificate of Determination dated 21 June 2010 records the Arbitrator’s orders as follows:
“The Commission determines:
1.Award for the Respondents
A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”

Mr Merrick, on 15 July 2010, registered an application seeking leave to appeal against the Arbitrator’s decision.

LEAVE TO APPEAL

There is no dispute between the parties concerning threshold requirements as prescribed by s 352 of the 1998 Act. I note in passing that at the hearing before the Arbitrator Mr Merrick’s application was amended, by consent, to vary the claim for weekly payments to the period 25 September 2006 to 25 October 2006. The payments sought in the application were approximately $1500 per week. That amendment is recorded in a transcript (T) of the proceedings (at T2). Whilst the claim is only in respect of a four week period, the magnitude of the weekly benefits as claimed has the result that the monetary threshold prescribed by s 352 is met.
Given the employers’ and the Nominal Insurer’s acknowledgment that the threshold requirements as to time and quantum have been met I conclude that it is appropriate that leave be granted to bring this Appeal and I so order.

ON THE PAPERS

Section 354(6) of the 1998 Act provides:

“(6)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 without holding any conference or formal hearing.”

Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

ISSUES IN DISPUTE

The issues in dispute in the appeal are whether the Arbitrator erred:
(a) in his application of s 9AA of the 1987 Act to the facts as found;
(b)   in finding that the employers’ principal place of business was not in New South Wales;
(c)   in his finding as to the onus concerning proof of the whereabouts of the employers’ principal place of business;
(d)   in not determining that Mr Merrick was entitled to compensation benefits by reason, in the alternative to matters otherwise argued, that the subject injury was received in New South Wales (s 9AA(5)), and
(e)   in failing to have regard to the evidence, in particular the statement by the employers that their Queensland office was a “satellite office”.

THE ARBITRAL PROCEEDINGS

The documentary evidence which was before the Arbitrator is summarised by him at [7] of his Reasons.
Mr Merrick, with the leave of the Arbitrator, gave oral evidence at the hearing. Detail of the evidence given is, where relevant, addressed hereunder.

The manner in which the proceedings were conducted before the Arbitrator demonstrates that the only issue agitated at that time was the question as to whether Mr Merrick’s employment was connected with the state of New South Wales within the meaning of s 9AA of the 1987 Act. That was the only dispute raised by the Nominal Insurer in its s 74 notice forwarded on 27 February 2009. In the circumstances it is unnecessary, on this Appeal, to give any attention to the very large volume of medical evidence which has been adduced by each of the parties. It is proposed to attempt a summary of the evidence relevant to the only issue agitated before the Arbitrator.

Mr Merrick’s evidence

Mr Merrick relied upon three statements made by him. The first was recorded by WorkCover Queensland on 3 April 2007. There are two later written statements, the first dated 8 November 2009 and the other 12 November 2009. Those latter statements are identical. Mr Merrick states that he commenced work for Mr Shelley and Mr Swan in 2006 after he had been telephoned by Mr Swan and informed that they were in need of a driver to perform long distance interstate haulage. Mr Merrick expressed an interest in such work and Mr Swan arranged for Mr Shelley to interview Mr Merrick at his (Mr Merrick’s) home in Scone, New South Wales. Mr Merrick states that he was told by Mr Shelley that he had “come up from their office in Kiama”. It is established by other evidence that Mr Merrick commenced that employment on 12 January 2006. Mr Merrick was instructed to travel in his own vehicle to Brisbane to pick up a semi trailer, following which he commenced work. He returned his own vehicle to Scone on a trailer. There was a depot in Brisbane which was a small house yard which was used to park one or two trucks. Mr Merrick states that from his observations the Brisbane depot was “not a major depot in terms of my employer’s overall business”.
Mr Merrick states that all “contact” for trucking deliveries, wages and jobs came from his employer’s Kiama office. He did not speak to anybody “of authority” in Brisbane. In February 2006 his driving duties were changed when he was required to transport loads between Brisbane, Queensland and Port Kembla, New South Wales. Those loads were of “oversized material”. Mr Merrick continued doing that delivery work until he received injury in April 2006.
Mr Merrick states that Mr Shelley had informed him that he was “from Kiama”. Mr Merrick reported his injury to Mr Shelley at Port Kembla. Instructions for loads “came from management at Kiama and Port Kembla”. Mr Merrick received instructions concerning return loads from Port Kembla to Brisbane from Mr Shelley in Kiama. Mr Merrick’s payslips were sent from Port Kembla or Kiama. Mr Merrick had received correspondence from his employers which had been sent by mail or fax from Kiama.
Mr Merrick relied upon correspondence dated 20 December 2007 sent by WorkCover Queensland to his solicitors. That correspondence summarised investigations that WorkCover Queensland had conducted concerning Mr Merrick’s claim for compensation benefits. The following matters, relevant to the matter in dispute, were noted in that correspondence:
(a)   the employer had stated that Mr Merrick was a Queensland worker as he is “based out of the Brisbane depot”;
(b)   the truck operated by Mr Merrick is maintained out of the Brisbane depot;
(c)   the truck driven by Mr Merrick is garaged in Brisbane;
(d)   the depot in Brisbane is a satellite office, all administration and wages and direction come from Port Kembla;
(e)   of the three drivers engaged in Queensland, two have not ever driven outside Queensland in the course of their work, and
(f)    Mr Merrick had been on a regular run from Wacol to Port Kembla and back for three months.
WorkCover Queensland stated in that correspondence that, following investigation, Mr Merrick’s claim was accepted upon the basis that the employment was connected with the state of Queensland within the meaning of s 113 of the Workers Compensation and Rehabilitation Act 2003 (Qld). WorkCover Queensland advised Mr Merrick’s solicitors that they were not willing to “rescind” their earlier acceptance of the claim. At the time of that correspondence Mr Merrick’s claim had been “closed”.
Mr Merrick relied upon a copy of the employer’s report of injury addressed to WorkCover Queensland which had been completed by Mr Shelley dated 8 August 2006. The employers address for correspondence noted in that document was a post office box at Port Kembla, New South Wales.
A copy of correspondence dated 27 February 2009 from WorkCover NSW to Mr Merrick is in evidence. That correspondence provided notice pursuant to s 74 of the 1998 Act concerning Mr Merrick’s disputed compensation claim. It is there asserted that, having regard to the relevant facts, Mr Merrick’s employment was connected with the state of Queensland as he was usually based in that state within the meaning of s 9AA(3)(b).
A copy of a business name extract - Queensland printed on 6 July 2009 was attached to Mr Merrick’s application. That extract records that the business name “Nationwide Transport Solutions” had been registered on 23 December 2005. The nature of the business was transportation services and the principal place of business was recorded as being 67 Noosa Ct, Heathwood, Queensland. A previous principal place of business is recorded in that extract as being 1 Kumalie Ct, Chambers Flat, Queensland. That address was registered between 21 November 2005 and 17 December 2007. The postal address as recorded is a post office box in Port Kembla, New South Wales as at the date of the extract. The previous postal address was a post office box at Ormeau, Queensland. The Queensland address was current between 21 November 2005 and 17 December 2007. The proprietors of the business were Mr Shelley and Mr Swan. Mr Shelley’s address is recorded as being 35 Whyandra Cl, Doonan, Queensland. Mr Swan’s address is recorded as being 10 Kefferan Pl, Ormeau, Queensland. That extract also notes the business has been carried on by a corporation known as Nationwide Transport Solutions Pty Limited since 11 February 2008.
A copy of an on-line search of the register of the Australian Securities and Investments Commission concerning Nationwide Transport Solutions Pty Limited dated 12 August 2008 is in evidence. The registered office of that corporation is 142 Manning Street, Kiama, New South Wales. The principle place of business of that corporation is noted as being the last mentioned Kiama address. Mr Shelley is noted as the sole director and secretary of the company and is the sole share holder. Mr Shelley’s address is given as 142 Manning Street, Kiama, New South Wales.
Mr Merrick gave oral evidence before the Arbitrator. His evidence in chief concerned the arrangement which involved Mr Merrick driving in his own vehicle to Brisbane for the purpose of picking up the truck used by him in the course of his work. That evidence is not directly relevant to the issues raised on this Appeal. In cross examination Mr Merrick said that there had been an “office” of the business in Port Kembla that he visited about “twice”. It was put to Mr Merrick that there was no depot at Port Kembla to which he replied “well, a parking area and that but there was toilets”. Mr Merrick had never unloaded his truck at the office but had “picked up a tarp” on one occasion.

Employers’ Evidence

The employers relied upon a statement made by Mr Shelley dated 6 July 2009. Mr Shelley’s address does not appear in that statement. At the time of Mr Merrick’s employment the business Nationwide Transport Solutions was conducted by Mr Shelley and Mr Swan on behalf of “the Shelley family trust and the Swan family trust”. The work Mr Merrick performed for the business involved driving trucks from Brisbane. The tax file number declaration completed by Mr Merrick at the time he was employed contains a Queensland address for the business. The business is based in Queensland and workers compensation insurance had been arranged by the business in that state. There were an unspecified number of trucks garaged, serviced and operated from Queensland. It is stated by Mr Shelley that the trucks regularly travelled to other states including Western Australia. Those vehicles were registered in Queensland. It is asserted by Mr Shelley that Mr Merrick has no entitlement to New South Wales workers compensation benefits. It is stated that Mr Merrick “has only made the allegation that he is a New South Wales worker after Queensland payments for workers compensation had come to an end”.
The employers relied on a four page history of events dated 7 August 2006. This appears to be a copy of a document attached to Mr Merrick’s application, however the complete document is annexed to the employers’ reply whereas Mr Merrick included only the first page of that document. It is recorded that Mr Merrick commenced employment on 27 (sic) January 2006. At the time he was engaged it was agreed that Mr Merrick would start work immediately however he would require five weeks off work in June to travel to England. That arrangement was the subject of agreement. Mr Merrick’s duties initially took him “predominately to North Queensland and a few trips to Western Australia”. From February 2006 Mr Merrick took up duties delivering between Brisbane and Port Kembla. The contract concerning the Port Kembla deliveries was expected to persist for four or five months. Mr Merrick reported an injury to his employers in April 2006. Correspondence confirming his resignation was forwarded by Mr Shelley to Mr Merrick on 26 April 2006. The last day of employment was noted in that correspondence as being 7 May 2005 (sic).
The employers have relied upon a copy of correspondence dated 15 September 2009 from their solicitors to Mr Merrick’s solicitors. That correspondence noted that Mr Shelley had purchased Mr Swan’s interest in the business Nationwide Transport Solutions. A copy of a business name extract printed on 6 July 2009 was enclosed with that correspondence.

The Nominal Insurer’s Evidence

The Nominal Insurer relied upon a copy of a tax file number declaration signed by Mr Merrick. In response to a question on that form to be completed by the employer “what is your business address?” the address 10 Kefferan Place, Ormeau, Queensland is noted in the form. The contact person nominated in that form was Mr Shelley and a business phone number being 0427 282 044 was also noted.
A very large volume of documents was attached to the reply filed on behalf of the Nominal Insurer however much of that evidence has no relevance to the issue which was agitated before the Arbitrator. In the circumstances it is unnecessary to attempt a summary of that material. I note that there is a PAYG payment summary issued by WorkCover Queensland concerning payment to Mr Merrick in respect of the year ending 30 June 2007. That document records that between 26 September 2006 and 29 June 2007 Mr Merrick was paid gross payments of $58,967 from which the sum of $16,855 was withheld as tax. A summary of payments made by WorkCover Queensland is also attached to the reply. That document records that payments of weekly compensation commenced on 15 September 2006. I note that other evidence suggests that weekly payments commenced on 8 May 2006.

Mr Merrick’s submissions

Counsel appearing on behalf of Mr Merrick placed reliance upon the provisions of s 9AA(3) of the 1987 Act and it was put that the provision is a “cascading definition”. It was argued that each of the sub-sub sections (a), (b) and (c) are to be addressed in order and that there is only a need to progress through those provisions if no State is identified by application of the provision in question. If none of those provisions identify the State with which employment is connected, counsel argued that there is then a need to address s 9AA(5).
Counsel submitted that there was a curious feature of the evidence being that the address of the business does not appear on any document generated by it.
It was submitted at the hearing that the evidence supports a conclusion that Mr Merrick usually worked in New South Wales within the meaning of s 9AA(3)(a). In the alternative it was argued that, if the evidence does not establish where Mr Merrick usually works, one looks at s 9AA(3)(b). It was put that Mr Merrick was “usually based” in Scone and that he travelled to Brisbane and thereafter to Port Kembla then returned to Scone. Acceptance of that summary of the evidence would lead the Arbitrator to conclude that Mr Merrick was usually based in New South Wales within the meaning of the Act.

Counsel proceeded to argue that should it be necessary to consider the last alternative in the sub-section, namely a determination of the principal place of business of the employer, such place of business was in New South Wales. In support of that proposition counsel relied upon the evidence concerning Mr Merrick’s contact with the Port Kembla office concerning deliveries, wages and jobs. It was put that Mr Merrick’s work included a return journey from Port Kembla which entailed picking up general goods in New South Wales to deliver in Brisbane. Counsel noted in submissions that the employers’ report of injury to Queensland WorkCover nominated an address for correspondence in Port Kembla. Reliance was also placed upon the evidence that Brisbane had been described by the employers as a “satellite office, all admin and wages and direction come from Port Kembla”.
It appears that counsel accepted that if connection with New South Wales is not established by consideration of the serial provisions in s 9AA(3) his client would fail to make out a case “because (5) does not apply, because of 5(b)” (T12.30).

The Nominal Insurer’s Submissions

Counsel appearing on behalf of the nominal insurer stated that the facts were such that it was difficult to determine the question as to where Mr Merrick “usually worked” within the meaning of the section. His ultimate argument was that the facts would suggest that Mr Merrick usually worked in Queensland.
Counsel proceeded to address the question as to where Mr Merrick was “usually based” upon the assumption that the Arbitrator was unable to determine where Mr Merrick usually worked. It was counsel’s argument that there was no doubt that Mr Merrick’s base was Brisbane. That argument was founded upon the basis that the depot from which Mr Merrick drove was there, the truck was serviced there and the vehicle was “housed” in Brisbane.
Counsel proceeded to argue that, if it was not possible to determine either where Mr Merrick usually worked or where he was usually based, one needed to determine the location of the principal place of business. It was put that the evidence, including the material contained in the business names extract, supports a conclusion that the employers’ principal place of business was located in Queensland.

The Employers’ Submissions

Counsel appearing on behalf of the employers argued that the evidence was such that a determination of the State with which the employment is connected may not easily be determined by reference to the question as to where Mr Merrick usually worked or that State where he was usually based. In the circumstances it is necessary to have regard to the location of the principal place of business. It was put that the principal place of business in Australia is “reflected in documents” and counsel drew attention to the recorded registration of a Queensland address as being the principal place of business. Emphasis was placed upon the evidence that the trucks were left in Brisbane, driven in Queensland and that they were registered in Queensland. It was also noted that the trucks were serviced in Queensland. The conclusion must be, it was argued, that Mr Merrick’s claim is defeated by reason of the provisions of s 9AA(3)(c).

The Arbitrator's decision

Following a summary of the evidence and argument advanced on behalf of the parties the Arbitrator concluded that the evidence did not permit a conclusion as to where Mr Merrick usually worked nor as to where Mr Merrick was usually based. It thus became necessary to address the question as to where the employers’ principal place of business was located. The Arbitrator concluded that such place was “clearly Queensland” (at [47]). The matters to which the Arbitrator referred included the registration of the Queensland address as principal place of business; the truck was housed in Queensland when not being used; the vehicle was serviced in Brisbane and that the employers maintained a depot in Queensland to which Mr Merrick returned after his deliveries in Port Kembla. Having concluded that the employers’ principal place of business was located in Queensland in terms of s 9AA(3)(c) the Arbitrator proceeded to enter an award in favour of each respondent.

SUBMISSIONS ON APPEAL

Mr Merrick’s submissions

Mr Merrick does not suggest any error on the part of the Arbitrator concerning his conclusion that the evidence did not permit a determination as to where, whilst employed, he “usually worked” or where he was “usually based”. It is stated in submissions that the Arbitrator “quite correctly held the view that in the circumstances [of the case] what was to be decided was whether or not the State of the employer’s (sic) principal place of business could be identified pursuant to section 9AA(3)(c)”. It is implicit that Mr Merrick has abandoned those arguments advanced before the Arbitrator concerning the issues of “usually worked” and “usually based”.
It is submitted that the following matters are established on the evidence and that such facts support a conclusion that the employer’s principal place of business was in New South Wales:
(a) Mr Merrick was offered the job by a principal of the firm who travelled from the South Coast.
(b) Mr Merrick’s instructions were received from the South Coast.

(c) The depot in Brisbane was confined to a yard where trucks were stored.

(d) The pay and administration occurred “out of the South Coast”.

(e) The only address recorded on any documentation provided by [the employers] was a post office box in Port Kembla as found in the employer’s report of injury. No other correspondence or written material contained any reference to the employers operating the business “out of Brisbane”.

(f) Nationwide Transport Solutions Pty Limited, which eventually assumed the business of the employers, operated from a registered address in New South Wales.

(g) Any meetings with the principals of the [employers] occurred on the South Coast.

It is argued that the matters summarised between (a) and (f) above are “all indicia of [the employers] having their principal place of business in New South Wales”. It is argued that such evidence is “unchallenged”. It is suggested in submissions that “an onus clearly passed to [the employers]” and that no evidence was presented by the employers to demonstrate that its principal place of business was outside the State of New South Wales.
It is argued, in the alternative to the above matters, that if, on the evidence, the location of the principal place of business cannot be established, there should be an award in favour of Mr Merrick having regard to the provisions of s 9AA(5)(a). That section provides that a worker’s employment is connected with New South Wales if the worker is in New South Wales when the injury happens.

The Nominal Insurer’s submissions

Submissions draw attention to the recent decision of Roche DP in the matter of Martin v R J Hibbens Pty Limited [2010] NSWWCCPD 83 (Martin). That decision was delivered following the Arbitrator’s determination made in the present matter. The facts of Martin concerned a determination as to whether relevant employment was connected with the State of New South Wales within the meaning of s 9AA. The facts of that matter required attention to be given to the meaning of the words “principal place of business” as found in that provision. Reliance was also placed upon the decision of the District Court of Western Australia in Tamboritha Consultants Pty Ltd v Knight [2008] WADC 78 (Knight). The decision in Knight concerned consideration of the meaning of the words “principal place of business”. Reference had been made to that decision in the course of the determination in Martin.
It is noted in submissions that the Arbitrator’s reasoning concerning his conclusion that the employer’s principal place of business was in Queensland is found between [47] and [49] of the determination .The submissions identified the evidence before the Arbitrator which supports the various factual conclusions as stated by the Arbitrator.
It is noted in submissions that the reference to the employers’ office in Queensland being a “satellite office” appears in a document created by WorkCover Queensland.
It is argued that the Arbitrator made no finding concerning the onus of proof as suggested by Mr Merrick. It is put that the onus is upon Mr Merrick to establish that he was a “worker” in terms of the New South Wales legislation and that proof of such fact includes the requirement to establish “connection” with the State of New South Wales (s 9AA).
The Arbitrator, having found Mr Merrick’s employment as being connected with the state of Queensland, had no need to consider any subsequent provision found in s 9AA.

The employers’ submissions

The employers adopt the submissions put on this appeal on behalf of the Nominal Insurer.
It is further argued on behalf of the employers that the office at Port Kembla was “in truth” a “satellite office”. The evidence establishes that the trucks were not unloaded there nor were they serviced at Port Kembla nor were they based in that town.

DISCUSSION AND FINDINGS

At the hearing before the Arbitrator, Mr Merrick relied upon the provisions of s 9AA and argued that the facts supported a conclusion that at relevant times he “usually worked” in New South Wales. In the alternative it was argued that if the Commission was not satisfied that he usually worked in that state the evidence supports a conclusion that he was “usually based” in New South Wales. As a further alternative Mr Merrick argued that if no one state is identified as earlier argued, then the Commission would be satisfied that the employers’ principal place of business was located in New South Wales. Mr Merrick’s entitlement to compensation would flow from any such finding which fell within the terms of s 9AA which provides relevantly:

“(1) Compensation under this Act is only payable in respect of employment that is connected with this State.

(2) The fact that a worker is outside this State when the injury happens does not prevent compensation being payable under this Act in respect of employment that is connected with this State.

(3) A worker’s employment is connected with:
(a)   the State in which the worker usually works in that employment, or
(b)   if no State or no one State is identified by paragraph (a), the State in which the worker is usually based for the purposes of that employment, or
(c)   if no State or no one State is identified by paragraph (a) or (b), the State in which the employer’s principal place of business in Australia is located.
(4) In the case of a worker working on a ship, if no State or no one State is identified by subsection (3), a worker’s employment is, while working on a ship, connected with the State in which the ship is registered or (if the ship is registered in more than one State) the State in which the ship most recently became registered.

(5) If no State is identified by subsection (3) or (if applicable) (4), a worker’s employment is connected with this State if:

(a) the worker is in this State when the injury happens, and
(b) there is no place outside Australia under the legislation of which the worker may be entitled to compensation for the same matter.
(6) In deciding whether a worker usually works in a State, regard must be had to the worker’s work history with the employer and the intention of the worker and employer. However, regard must not be had to any temporary arrangement under which the worker works in a State for a period of not longer than 6 months…”

On this appeal Mr Merrick has abandoned his arguments concerning the tests “usually works” and “usually based” as they appear in subsection 3 of the provision. The arguments advanced on appeal may be reduced to two propositions. First the Arbitrator’s conclusion that the employers’ principal place of business was located in Queensland is challenged and it is put that, on the facts, the principal place of business is within New South Wales. The second argument advanced is put upon an assumption that the evidence does not permit a determination as to the locus of the principal place of business. In that circumstance it is argued that the evidence is that the subject injury occurred in New South Wales, and entitlement to benefits is founded upon the provisions of s 9AA(5).
The evidence establishes that at the date of injury the employers’ principal place of business was registered as being 1 Kumalie Ct, Chambers Flat, Queensland. The registration of such detail is not, in my view, conclusive concerning the question as to the whereabouts of the principal place of business. I agree with the statements to be found in both Knight and Martin that determination of the employers’ “principal place of business” requires a determination of what is the most important or main place where it conducts the main part or majority of its business (Martin at [60(d)]).
The Arbitrator (at [48] of Reasons) had regard to the fact that the employers maintained a depot in Brisbane where the truck driven by Mr Merrick was kept when not being used. Also taken into account was the evidence that Brisbane was where the vehicle was serviced and that Mr Merrick commenced each of his journeys in Queensland. Those matters led the Arbitrator to conclude that the employers’ principal place of business was in Queensland and, for that reason, Mr Merrick had failed “to maintain this application as his employment is not connected with the State of New South Wales” (at [49]).
I reject the Nominal Insurer’s submission that the Arbitrator has not addressed the question of onus of proof in the course of his determination. It is reasonably clear that those matters stated at [49] of Reasons imply that Mr Merrick’s application for compensation could only be maintained upon proof by him that his employment was connected with the State of New South Wales. However, I reject Mr Merrick’s argument that the Arbitrator’s reasoning as expressed demonstrates error concerning the onus of proof of matters raised for determination by the provisions of section 9AA. There is no doubt that in proceedings such as the present there may be a “shifting” of the evidentiary burden in circumstances where a worker adduces evidence sufficient to establish a fact in issue upon a prima facie basis. In the present case all parties have adduced evidence concerning the issue of “principal place of business”. That evidence required evaluation by the Arbitrator to determine Mr Merrick’s entitlement, or otherwise, to compensation benefits in this state.
There is evidence of business activity in both Brisbane, Queensland and Port Kembla/Kiama, New South Wales. The evidence does not reveal a number of matters that may be taken to be within the knowledge of the employers. In those circumstances it was open to Mr Merrick to argue that an inference may be drawn in his favour that presentation of evidence concerning the manner of conduct of the business would not advance the employers’ case. That is a very different proposition to Mr Merrick’s assertion that there is a legal onus upon the employers. As was stated, albeit in dissent on other grounds, by Barwick CJ in Katsilis v Broken Hill Pty Co Ltd (1977)18 ALR 181 at 197 “a case is normally better tried on the evidence which is produced than on that which is not”. I note that His Honour the Chief Justice proceeded to consider the possible consequences of a party failing to adduce evidence within its knowledge.
Mr Merrick correctly notes in the course of his submissions that a peculiar feature of the documentary evidence is that the employers’ address does not appear on any document generated by it. It is, in my view, relevant to note that Mr Shelley’s statement upon which he relies, made on 6 July 2009, does not include a notation of his residential or business address. It is reasonable to infer that the omission of such particulars concerning addresses has been deliberate. The business affairs of Mr Shelley and Mr Swan were, at the relevant time, not without complication. There can be no doubt that the employers conducted a busy interstate trucking business and it appears that there had been interposition of family trusts between themselves and the activities of the business. Whilst these matters are not elaborated in the evidence, it is clear that the manner in which the business was conducted had been, in part, determined having regard to professional advice.
The evidence clearly establishes that the employers conducted business both in Queensland and New South Wales at relevant times. Mr Merrick has given evidence that the employers have an office in Kiama, New South Wales. The address of that office is not revealed in the evidence. Mr Merrick’s evidence is that his employment followed a telephone conversation with Mr Swan and an interview with Mr Shelley. Mr Shelley stated that he had “come up from their office in Kiama”. That evidence is not challenged. The evidence as found in the business names extract dated 19 November 2009 is that Mr Swan, at relevant times, resided at 10 Kefferan Place, Ormeau, Queensland. That is the only evidence concerning Mr Swan’s address. The postal address for the employers’ business at relevant times was post office box 152, Ormeau, Queensland. That evidence is to be found in the business names extracts dated 6 July 2009 and 19 November 2009.
The state of the evidence is such that there remain a number of uncertainties however it is reasonably clear that at relevant times Mr Shelley was either permanently or temporarily working out of the office situated in Kiama. As earlier noted the only evidence of an address for Mr Swan is one in Queensland. The suburb in which Mr Swan was said to reside corresponds with the post office at which the postal address of the business was registered.
The evidence of Mr Merrick concerning the business activities which took place in Kiama is not disputed by the employers. I accept that administrative activities of the business were conducted at that Kiama address. The question remains as to whether those activities are such that it can be said that Kiama was “the most important or main place where [the business] conducts the main part or majority of its business”, being the question posed in the matter of Knight.
The business concerned interstate transport and haulage with some specialisation in heavy and oversized loads. The equipment, three trucks, required for the conduct of that business were based in Queensland. The vehicles were registered in that state and were serviced in Queensland. They were, when not in use, parked at an unspecified address in Queensland. Mr Merrick was required to travel to Queensland to take possession of the truck and commence his duties. It is stated in evidence that the other two trucks operated by the business were involved almost exclusively in delivery work within Queensland.
Whilst the evidence supports an inference that management and administrative activities occurred in Kiama, it is clear that the most important place of business was Queensland where the expensive trucking equipment was based, serviced and registered. Much of the business of the two vehicles not operated by Mr Merrick was carried out within the State of Queensland. I have reached the view that the Arbitrator was correct in his conclusion that the employer’s principal place of business within the meaning of s 9AA was located in Queensland. The employment is not connected with this state (s 9AA(1)) thus Mr Merrick has no entitlement to benefits as prescribed by the New South Wales workers compensation legislation. The Arbitrator was correct to enter awards in favour of the employers and the Nominal Insurer.

DECISION

The decision of the Arbitrator dated 21 June 2010 is confirmed.

COSTS

No order as to costs of this appeal.

Kevin O’Grady
Deputy President
30 September 2010

I, PENELOPE FLEMING CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF KEVIN O’GRADY, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE

[2010] NSWWCCPD 106

30 September 2010

Key Legal Topics

Areas of Law

Workers Compensation Law

Legal Concepts

Burden of Proof

Statutory Interpretation