Ramsey Food Processing Pty Ltd v Tomlinson - [2014] NSWCA 237

Court of Appeal

New South Wales

Case Title: Ramsey Food Processing Pty Ltd v Tomlinson

Medium Neutral Citation: [2014] NSWCA 237

Hearing Date(s): 22/05/2014

Decision Date: 21 July 2014

Before: Meagher JA at [1];
Ward JA at [22];
Emmett JA at [23]

Decision:
1 To the extent necessary, leave be granted to appeal from the order made on 13 May 2013 that paragraph 8 of the defence filed by the appellant be set aside.
2 The appeal be allowed.
3 The orders made by the District Court on 13 May 2013 be set aside and, in lieu of those orders, there be substituted verdict and judgment for the defendant and an order that the plaintiff pay the defendant's costs.
4 The respondent pay the appellant's costs of this appeal.
5 The respondent, if otherwise qualified, be granted a certificate under the Suitors' Fund Act 1951 (NSW).

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: ESTOPPEL - former adjudication - issue estoppel - matters necessary to the decision - identity of parties - whether the Fair Work Ombudsman was the privy of the respondent employee in earlier proceedings - whether the issue of the respondent's employment by the appellant had been decided in the earlier proceedings

EMPLOYMENT LAW - the relationship of employer and employee - whether the respondent was an employee of the appellant - whether that relationship was affected by a company inter-positioned between the appellant and respondent

Legislation Cited: Civil Liability Act 2002 (NSW), s 5D
Civil Procedure Act 2005 (NSW), s 100
Fair Work Act 2009 (Cth), ss 680, 681, 682
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth), Sch 3, Sch 18
Federal Meat Industry (Processing) Award 2000, cll 9, 10
Workers Compensation Act 1987 (NSW), ss 3, 9, 9A, 151A, 151C, 151H, 151G, 155
Workplace Injury Management and Workers Compensation Act 1998 (NSW), ss 4, 250, 280A, 280B, 281, 315, 318A, 322
Workplace Relations Act 1996 (Cth), ss 717, 719

Cases Cited: Blair v Curran [1939] HCA 23; 62 CLR 464
Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd [1986] HCA 14; 160 CLR 226
Dong v Monkiro Pty Ltd [2005] NSWSC 749
Fair Work Ombudsman v Ramsey Food Processing Pty Ltd [2011] FCA 1176; 198 FCR 174
Grundt v Great Boulder Pty Gold Mines Ltd [1937] HCA 58; 59 CLR 641
Jackson v Goldsmith [1950] HCA 22; 81 CLR 446
Ramsay v Pigram [1968] HCA 34; 118 CLR 271
Rogers v The Queen [1994] HCA 42; 181 CLR 251
Trawl Industries of Australia Pty Ltd (In Liq) v Effem Foods Pty Ltd [1992] FCA 272; 36 FCR 406
Withyman (by his tutor Glenda Ruth Withyman) v State of New South Wales [2013] NSWCA 10

Texts Cited: Justinian's Digest, 44.2.7.4
Justinian's Institutes, 4.10
KR Handley, Spencer Bower & Handley, Res Judicata (4th ed 2009, LexisNexis Butterworths)

Category: Principal judgment

Parties: Ramsey Food Processing Pty Ltd (Appellant)
Grant Tomlinson (Respondent)

Representation

- Counsel: Counsel:
R Cavanagh SC with K Andrews (Appellant)
R Goodridge (Respondent)

- Solicitors: Solicitors:
A R Conolly & Company (Appellant)
Monaco Solicitors (Respondent)

File Number(s): 2013/172501

Decision Under Appeal

- Before: Mahony DCJ

- Date of Decision: 17 May 2013

- Citation: Grant Tomlinson v Ramsey Food Processing Pty Ltd [2013] NSWDC 64

- Court File Number(s): 2011/194262

Publication Restriction: Nil

JUDGMENT

MEAGHER JA: In June 2011 the respondent (Mr Tomlinson) commenced proceedings in the District Court against the appellant (Ramsey Food) for common law damages for an injury suffered on 17 June 2008 whilst he was working at an abattoir operated by Ramsey Food at South Grafton. He alleged in those proceedings that at the time of the accident he was an employee of Tempus Holdings Pty Ltd (Tempus) and that pursuant to a labour hire agreement between it and Ramsey Food his services were being provided to Ramsey Food. He alleged that Ramsey Food owed him a duty of care "equivalent to that of an employer".
Relying on provisions of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (ss 280A, 280B, 315 and 318A) and of the Workers Compensation Act 1987 (NSW) (ss 151C, 151H and 151G), Ramsey Food maintained that Mr Tomlinson could not bring an action for damages against it, or recover damages from it, in respect of that injury. That argument, in the various ways it was put, depended on the fact being that Ramsey Food was Mr Tomlinson's employer at the time the injury was suffered.
Ramsey Food sought to make good the allegation that it was Mr Tomlinson's employer in two ways. First, it said that it had the benefit of an issue estoppel as against Mr Tomlinson, which arose from the judgment and orders of Buchanan J in Fair Work Ombudsman v Ramsey Food Processing Pty Ltd [2011] FCA 1176; 198 FCR 174. Secondly, it alleged that, as a matter of fact, it had employed Mr Tomlinson at the time of the accident.
I agree with Emmett JA that the primary judge erred in concluding that Ramsey Food did not have the benefit of the issue estoppel claimed. My reasons for doing so follow and do not differ in substance from those of his Honour. In addition, I agree with Emmett JA's reasons for rejecting Mr Tomlinson's various contentions as to why the judgment entered in his favour in the Court below should be upheld.
A central issue in Mr Tomlinson's proceedings for negligence was whether at the time of the accident he was employed by Ramsey Food. That question was raised by paragraph 8 of Ramsey Food's Defence. If he was employed by Ramsey Food at the time of the injury, the action against it for negligence was one for common law damages against the party liable as his employer to pay workers compensation in respect of that injury because that employment was a substantial contributing factor to the injury: see ss 9(1) and 9A(1) of the Workers Compensation Act 1987 (NSW). If Ramsey Food was Mr Tomlinson's employer, the statutory provisions referred to in [2] above were engaged and it was conceded by Mr Tomlinson that he could not bring an action against Ramsey Food for damages in respect of his injury.
For an issue estoppel to arise in relation to a particular question, the same question must have been decided by a judicial decision which was final and the parties to that decision or their privies must be the same as those to the proceedings in which the estoppel is raised: Blair v Curran (1939) 62 CLR 464 at 531-533 (Dixon J as the Chief Justice then was); Withyman (by his tutor Glenda Ruth Withyman) v State of New South Wales [2013] NSWCA 10 at [106] (Allsop P, Meagher JA and Ward JA agreeing).
The primary judge concluded that Ramsey Food did not have the benefit of an issue estoppel for three reasons. First, Tempus was not a party to the proceeding brought by the Fair Work Ombudsman against Ramsey Food. Secondly, the subject matter of the Federal Court proceeding was different from that of the District Court proceeding. The former was concerned with enforcing Mr Tomlinson's statutory leave and other entitlements and the latter with his workplace injury. Thirdly, the Fair Work Ombudsman was not Mr Tomlinson's privy because he could not direct or control its conduct of the proceedings.
These conclusions make it necessary to consider whether the issue as to Ramsey Food being Mr Tomlinson's employer at the time of the work accident arose in the Federal Court proceedings; whether the orders made by Buchanan J as to Mr Tomlinson's entitlements as against Ramsey Food were final orders in the relevant sense; and whether the Fair Work Ombudsman, in making claims for those moneys was a privy in interest.
At the time of the accident, Mr Tomlinson's employment, whether by Ramsey Food or Tempus, was subject to the Federal Meat Industry (Processing) Award 2000 (the Award). The Federal Court proceedings were brought against Ramsey Food under s 719 of the Workplace Relations Act 1996 (Cth) (since repealed), for the imposition and recovery of penalties for breaches of terms of that award. The persons who were entitled to seek that relief included an employee whose employment was subject to the relevant award and, by s 682(1)(d) of the Fair Work Act 2009 (Cth) (which when it came into effect on 1 July 2009 replaced the Workplace Relations Act 1996 (Cth)), the Fair Work Ombudsman.
The Fair Work Ombudsman alleged breaches by Ramsey Food of cll 9 and 10 of the Award with respect to the termination by it of the employment of 11 employees, including Mr Tomlinson, on and from 25 November 2008. The entitlements of those employees depended upon the period of time for which they had been employed.
Buchanan J described at [1] the principal issue in the proceedings as being:
"... whether Ramsey [Food], as employer of 11 persons [including the appellant] at the abattoir whose operations it managed at South Grafton in New South Wales, failed to pay those employees amounts of money due on account of the termination of their employment in November 2008. The amounts in question are referable to obligations to make payment in lieu of notice, for severance pay and for untaken annual leave under the provisions of the Federal Meat Industry (Processing) Award 2000 and s 235 of the Workplace Relations Act 1996 (Cth) (as it then stood) ... the principal question which requires examination to decide those issues is whether Ramsey Food Processing was the employer of the complainant employees or whether, as the respondents contended, those persons (and many others) were employed by Tempus Holdings Pty Ltd , a company inter-positioned between Ramsey Food Processing and the employees." (emphasis added)
His Honour concluded at [99] that:
"... whether the matter is approached by asking whether Tempus was the actual employer (or whether Ramsey Food Processing was the direct employer notwithstanding the attempted inter-positioning of Tempus from mid-October 2006), or by asking whether Tempus acted as the agent for Ramsey Food Processing (rather than in its own right), the answers are the same. On either of those approaches, the respondents' defence to the present proceedings must be rejected. Tempus was not an employer in its own right. Ramsey Food Processing was, at all relevant times between 17 October 2006 and 28 November 2008 the employer of each of the 11 complainant employees".
That conclusion was as to the existence of a contractual relationship of employer and employee between Ramsey Food and Mr Tomlinson for the period from 17 October 2006 to 28 November 2008 under which he worked for Ramsey Food at its abattoir.
Buchanan J held that under the terms of the Award, the 11 employees were entitled to ten days notice of termination or to payment in lieu of that notice: [131], [134]; and that nine of the employees, including Mr Tomlinson, were entitled to be paid a further six weeks pay as severance pay because, within the terms of the Award, their employment had been terminated by "reason of redundancy": [135], [136], [137].
The final orders and declarations made included the following:
"...
2. Each of Grant Tomlinson, Nathan Korn and Brent Slack was employed by [Ramsey Food] at the South Grafton Abattoir from at least 17 October 2006.
...
8. The employment of each of the employees referred to in 1, 2, 3, 4 and 5 above was terminated by [Ramsey Food], effective on and from 28 November 2008, by notice given on behalf of [Ramsey Food] on 25 November 2008.
9. [Ramsey Food], in breach of clause 9 of the Federal Meat Industry (Processing) Award 2000, failed to afford notice of termination of their employment to each of the employees referred to in 1, 2, 4 and 5 above.
10. [Ramsey Food], in breach of clause 10 of the said Award, failed to pay severance pay to each of the employees referred to in 1, 2, 4 and 5 above as a result of the termination of their employment."
In his judgment delivered on 19 October 2011, Buchanan J requested the parties to provide short minutes containing "orders specifying the total amount due to each of the complainant employees, and the date on which such orders will take effect": [149]. The orders referred to were orders to be made under s 719(6) which provided that if the court was satisfied "that an employee of the employer has not been paid an amount that the employer was required to pay" under an award, it could order the employer to pay the amount of any underpayment to the employee.
Claims for orders to that effect were made, including in relation to Mr Tomlinson. Mr Tomlinson was cross-examined in the District Court proceeding as to his involvement in the earlier proceeding commenced by the Fair Work Ombudsman. He said that after his employment had been terminated in November 2008, he saw someone from the Fair Work Ombudsman's office about unpaid annual leave, redundancy and termination payments. He was asked to prepare an affidavit and did so. That affidavit was sworn on 17 March 2011 and filed in the Federal Court proceeding. Mr Tomlinson understood the purpose of the proceeding commenced by the Fair Work Ombudsman to be to get his "entitlements" from Ramsey Food.
Orders under s 719(6) were made on 31 October 2011. They included that Ramsey Food pay Mr Tomlinson $5,337.49 consisting of $717.08 being the payment in lieu of the notice to which he was entitled under cl 9 of the Award, $3,585.41 representing severance payments due pursuant to cl 10 of the Award and $1,035.00 being interest on those unpaid entitlements for the period from 28 November 2008 to 31 October 2011.
This consideration of the claims made and issues determined in the Federal Court proceeding relevantly shows three things. The first is that to establish Mr Tomlinson's entitlement to the orders made against Ramsey Food for payment of moneys to him, it was necessary to determine that he was employed by Ramsey Food during a period which included 17 June 2008. The second is that those orders, made under s 719(6), finally determined as between Mr Tomlinson and Ramsey Food, the fact of his entitlement to be paid those amounts under the terms of the Award which applied to him as an employee of Ramsey Food. The third is that the claim for those orders was made by the Fair Work Ombudsman on behalf of and for the benefit of Mr Tomlinson, and with his consent. That claim, in the language of Barwick CJ in Ramsay v Pigram (1967) 118 CLR 271 at 279, was made by the Ombudsman "under or through the person of whom he is said to be a privy".
It follows that the primary judge erred in not concluding that by reason of the decision of and orders made in the Federal Court proceeding to which Mr Tomlinson's privy in interest, the Fair Work Ombudsman and Ramsey Food were parties, Mr Tomlinson was estopped from denying that he was employed by Ramsey Food at the time he suffered his injury on 17 June 2008.
The orders proposed by Emmett JA should be made.
WARD JA: I agree, for the reasons expressed by Emmett JA, with the orders his Honour proposes. I also agree with Meagher JA's reasons.
EMMETT JA: The question in this appeal is whether the respondent, Mr Grant Tomlinson, was an employee of the appellant, Ramsey Food Processing Pty Ltd (Ramsey Food), on 17 June 2008. The question arose in proceedings in the District Court (the District Court Proceedings) brought against Ramsey Food by Mr Tomlinson for the recovery of damages for an injury that he suffered on that day while working at an abattoir at South Grafton (the Abattoir). At the time of the injury, the Abattoir was operated by Ramsey Food.
In the District Court Proceedings, Mr Tomlinson contended that he was not an employee of Ramsey Food at the time of his injury, but was an employee of another company, Tempus Holdings Pty Ltd (Tempus). On the other hand, Ramsey Food contended that Mr Tomlinson was employed by it at the time of his injury. Ramsey Food also contended that, having regard to declarations and orders made in proceedings NSD 1005 of 2010 in the Federal Court of Australia (the Federal Court Proceedings), Mr Tomlinson was estopped from denying that he was an employee of Ramsey Food at that time.
A judge of the District Court (the trial judge) accepted Mr Tomlinson's contentions that he was not an employee of Ramsey Food. The trial judge then found in favour of Mr Tomlinson and entered judgment against Ramsey Food in the sum of $155,069.00. Ramsey Food now appeals from those orders. The only question in the appeal is whether Mr Tomlinson was an employee of Ramsey Food at the relevant time and, in particular, whether he is estopped from denying that he was an employee at that time. Before dealing with that question, it is necessary to say something about the Federal Court Proceedings as well as the District Court Proceedings.

The Federal Court Proceedings

The applicant in the Federal Court Proceedings was the Fair Work Ombudsman. The respondents were Ramsey Food and Mr Stuart Ramsey, a principal of Ramsey Food. The Federal Court Proceedings were heard by Buchanan J, who, for reasons published on 19 October 2011 (see [2011] FCA 1176; 198 FCR 174), made declarations and orders on 31 October 2011. While the pleadings in the Federal Court Proceedings were not in evidence before the trial judge, the reasons of Buchanan J and the declarations and orders made by him on 31 October 2011 were in evidence.
It appears that the Federal Court Proceedings were brought under s 719 of the Workplace Relations Act1996 (Cth). Section 719(1) relevantly provided that an eligible court (including the Federal Court of Australia) was authorised to impose a penalty on a person if that person was bound by an applicable provision and the person breached that provision. Section 719 also provided that where, in a proceeding against an employer under s 719, it appeared to the Federal Court that an employee of the employer had not been paid an amount that the employer was required to pay under an applicable provision, the Federal Court could order the employer to pay to the employee the amount of the underpayment.
Under s 717, an applicable provision in relation to a person included a term of an award that applies to the person. At relevant times, the terms of the Federal Meat Industry (Processing) Award 2000 (the Award) applied to Mr Tomlinson.
Buchanan J made declarations that:
·Mr Tomlinson was employed by Ramsey Food at the Abattoir from 17 October 2006;
·At all times from 17 October 2006 to 28 November 2008, Tempus was under the direction and control of Ramsey Food and Mr Ramsey, and was the agent of Ramsey Food;
·The employment of Mr Tomlinson was terminated by Ramsey Food, effective on and from 28 November 2008, by notice given on behalf of Ramsey Food on 25 November 2008;
·In breach of cl 9 of the Award, Ramsey Food failed to provide notice of termination of employment to Mr Tomlinson, and
·In breach of cl 10 of the Award, Ramsey Food failed to pay severance pay to Mr Tomlinson as a result of the termination of his employment.
His Honour also ordered Ramsey Food to pay Mr Tomlinson the sum of $5,337.49. That sum was made up of amounts representing payment in lieu of notice terminating his employment, severance pay and interest on those entitlements under the Award that were unpaid.
In his reasons, Buchanan J said that the issue in the proceedings was whether Ramsey Food, as employer of eleven persons at the Abattoir (described by his Honour as the complainant employees), failed to pay to the complainant employees amounts of money due on account of the termination of their employment on 28 November 2008. Mr Tomlinson was one of the complainant employees. His Honour said that the principal question before him was whether Ramsey Food was the employer of the complainant employees or whether, as Ramsey Food and Mr Ramsey contended, the complainant employees were employed by Tempus, which his Honour described as "a company inter-positioned between [Ramsey Food] and the employees".

The phrase "complainant employees" has no special meaning under any relevant legislation. Ramsey Food contends that the phrase should be taken as referring to those employees who had complained to the Office of the Fair Work Ombudsman so as to prompt the commencement or institution of proceedings by the Fair Work Ombudsman. I shall refer later to the relevant provisions of the Fair Work Act 2009 (Cth). That Act replaced the Workplace Relations Act when it came into force on 1 July 2009 and is relevant in so far as it relates to the role of the Fair Work Ombudsman in the Federal Court Proceedings, which were instituted after the commencement of the Fair Work Act. The Fair Work Act established the Fair Work Ombudsman.
Buchanan J made very careful and detailed factual findings concerning the arrangements between Tempus and Ramsey Food, in so far as they affected the relationship between Ramsey Food and the complainant employees, including Mr Tomlinson. The principal element in the arrangements was an instrument entered into between Tempus and Ramsey Food on 16 October 2006 (the October Deed). The October Deed recited that Ramsey Food conducted and managed a food processing business, that Ramsey Food required labour, that Tempus had appropriate labour available to man the business and that the parties had agreed that Tempus would supply labour for the business. The operative clauses of the October Deed provided that:
·Tempus would supply appropriate staff to Ramsey Food on a day-to-day basis;
·Ramsey Food would pay Tempus all outgoings associated with the supply of labour, which would include wages, staff entitlements, administration and workers' compensation; and,
·Ramsey Food would indemnify Tempus for all suits, claims, actions and damages in respect of any liability whatsoever that Tempus might incur in relation to the employment of staff at the Abattoir.
After making factual findings about the arrangements involving the purported employment of Ramsey Food's employees by Tempus, Buchanan J examined the legal principles concerning the circumstances in which a business entity might obtain labour for its own business, without direct employment. His Honour referred to three possibilities, being independent contracting, labour hire and intra-group arrangements.
In relation to independent contracting, Buchanan J observed that the difference between a contract of employment, or contract of service, and an independent contract, or contract for services, is well established, although the tests developed to resolve which of the two relationships exists in any particular case may be easier to state than to apply. His Honour concluded that, when the tests were applied in the case before him, they indicated clearly that Tempus did not stand in a traditional relationship of employer with any of the complainant employees. His Honour considered that, since Tempus was not the employer, the true employer was Ramsey Food.
In relation to labour hire, Buchanan J observed that, subject to the principle that a contract of employment cannot be unilaterally assigned, the common law has long recognised the possibility that an employee of one business entity might be hired, lent or seconded to another business entity, without any change in the employment relationship occurring. His Honour accepted that arrangements whereby one company provides labour to another, without the recipient thereby becoming an employer, are long-standing and unremarkable. After considering the relevant tests for determining whether a labour hire company has been inter-positioned between a client and workers hired for the purpose of the client's business, his Honour concluded that none of the tests was satisfied by the arrangements between Tempus and Ramsey Food.
Buchanan J then dealt with labour arrangements within a group of companies, or between associated companies. His Honour considered the reasons why companies, business entities or enterprises associated with each other might wish to organise their affairs in a way that one legal person employs labour for the ultimate use and benefit of the other legal persons. His Honour considered that, in such arrangements, it must be possible to identify a rational explanation for the arrangement that is satisfactorily related to an intelligible business objective. His Honour concluded that the arrangements between Tempus and Ramsey Food did not pass the tests that his Honour had identified.
Buchanan J concluded that the arrangements between Tempus and Ramsey Food did not constitute or evidence employment by Tempus of any of the complainant employees. His Honour was satisfied that, after 16 October 2006, when the arrangements between Tempus and Ramsey Food were put in place, the employer of all of the complainant employees, including Mr Tomlinson, was Ramsey Food. His Honour considered that Tempus bore none of the characteristics of an employer. It had no business of its own, it earned no money, and it had no interest in the engagement of any employee except as a favour to Ramsey Food. Ramsey Food, on the other hand, had every right and privilege normally associated with an employer in its dealings with the workforce at the Abattoir. It had the right to recruit employees and dismiss them, and it had the right to decide what work was to be performed and by whom. His Honour concluded that the obligations that came with those rights were not displaced by the purported interpositioning of Tempus between Ramsey Food and the complainant employees.
Buchanan J concluded that that attempted interpositioning was ineffective to produce the consequence that Tempus was their employer. His Honour considered that, whether the matter was approached by asking whether Tempus was the actual employer, or by asking whether Tempus acted as the agent of Ramsey Food, the answer was the same. His Honour held that Tempus was not an employer in its own right, and that Ramsey Food was, at all relevant times between 17 October 2006 and 28 November 2008, including the time when Mr Tomlinson's injury occurred, the employer of each of the complainant employees, including Mr Tomlinson.
Buchanan J considered that three possible conclusions were open as to the respective legal positions of Ramsey Food and Tempus, but that each led to the same result. The first possible conclusion was that, despite the arrangements entered into and the steps taken in the name of Tempus, Tempus never became, and did not act as, the employer of the complainant employees. The second possible conclusion was that, if any steps taken to interposition Tempus between the complainant employees and Ramsey Food were to be regarded as having any effect at all, everything that was done in the name of Tempus was done by Tempus, or others, acting in the course of the business, and on behalf, of Ramsey Food, such that anything done by Tempus was done as the agent for Ramsey Food and not by Tempus independently. The third possible conclusion was that everything done in the name of Tempus was a sham. Buchanan J found that the establishment of Tempus had its origins in deceit and that persons acting on behalf of Ramsey Food did so to frustrate, deny or defeat the entitlements of employees of Ramsey Food. While his Honour considered that that conclusion supported and reinforced the earlier two conclusions, he did not consider that it was necessary for either of those conclusions.

The District Court Proceedings

In his statement of claim filed on 14 June 2011 (the Statement of Claim), Mr Tomlinson claimed damages from Ramsey Food, together with interest under s 100 of the Civil Procedure Act2005 (NSW) and additional interest up to judgment. The allegations made by Mr Tomlinson in the Statement of Claim may be summarised as follows:
·At all relevant times, Mr Tomlinson was an employee of Tempus and, as such, Tempus was Mr Tomlinson's general employer;
·Pursuant to a labour hire agreement, being the October Deed, Tempus provided Mr Tomlinson to Ramsey Food to perform work for it, and Ramsey Food became Mr Tomlinson's employer pro hac vice;
·By reason of that labour hire agreement, Ramsey Food owed a duty of care to Mr Tomlinson akin to, or equivalent to, that of an employer;
·Mr Tomlinson worked under the direction, management and control of Ramsey Food;
·At all material times, Mr Tomlinson was employed at the Abattoir;
·On 17 June 2008, during and in the course of his duties for Ramsey Food, Mr Tomlinson was injured when he was attempting to lift a large roll of plastic bags onto a bracket;
·That injury was caused by the negligence of Ramsey Food; and
·By reason of that negligence, Mr Tomlinson has suffered loss and damage.
In its defence filed on 25 November 2011 (the Defence), Ramsey Food:
·denied that Mr Tomlinson was entitled to the relief claimed;
·admitted that Mr Tomlinson worked under its direction, management and control and that he was employed at the Abattoir;
·denied that Mr Tomlinson suffered any injury;
·denied that any injury suffered by Mr Tomlinson was caused by its negligence;
·asserted that, if Mr Tomlinson suffered the injury, loss and damage claimed, it was caused as a result of his own fault and contributory negligence;
·did not admit any of the other allegations made by Mr Tomlinson in the Statement of Claim.
In addition, in paragraph 8 of the Defence, Ramsey Food asserted, in answer to the whole of the Statement of Claim, that, on the basis of the determination made in the Federal Court Proceedings, Mr Tomlinson was employed by Ramsey Food at all relevant times. It asserted that therefore:
·Mr Tomlinson was precluded, by s 280A and s 280B of the Workplace Injury Management and Workers Compensation Act1998 (NSW) (the Management Act) and s 151C of the Workers Compensation Act1987 (NSW) (the Compensation Act), from bringing the proceedings because he had not made a claim against Ramsey Food for lump sum compensation in respect of his alleged injury and had not been paid lump sump compensation by Ramsey Food;
·Mr Tomlinson was precluded from bringing the proceedings by s 315 and s 318A of the Management Act, because he had not served a pre-filing statement on Ramsey Food and had not referred his claim against Ramsey Food to a mediation;
·By reason of s 151H of the Compensation Act, Mr Tomlinson was unable to recover damages against Ramsey Food because he does not suffer a degree of permanent impairment that is at least 15 percent;
·By reason of s 151G of the Compensation Act, Mr Tomlinson was precluded from recovering damages for out-of-pocket expenses and domestic assistance from Ramsey Food.
It is desirable to say something about the relevant legislative provisions.
Section 9 of the Compensation Act relevantly provides that a worker who has received an injury is entitled to receive compensation from his employer in accordance with the Compensation Act. Under s 4 of the Management Act, a worker is a person who has entered into, or works under, a contract of service with an employer, subject to exceptions not presently relevant. Under s 3(1AA) of the Compensation Act, that definition also applies to that Act.
Section 280A of the Management Act relevantly provides that a claim for work injury damages in respect of an injury cannot be made unless a claim for lump sum compensation in respect of the injury is made before or at the same time as the claim for work injury damages. Under s 250(1), work injury damages includes damages recoverable from a worker's employer in respect of an injury to the worker caused by the negligence or other tort of the employer, whether the damages are recoverable in an action for tort or breach of contract or in any other action. A reference to a worker's employer in that provision includes a reference to a person who is vicariously liable for the acts of the employer and a person for whose acts the employer is vicariously liable. Under s 4, the term injury means a personal injury arising out of or in the course of employment.
Section 280B of the Management Act provides that an injured worker cannot recover damages in respect of an injury from the employer liable to pay compensation under the Management Act in respect of the injury unless and until any permanent impairment compensation to which the worker is entitled in respect of the injury has been paid. That provision ensures that the injured worker receives the compensation to which the worker is entitled before damages are recovered. Otherwise, s 151A of the Compensation Act would prevent the payment of compensation after damages are recovered.
Under s 151A(1) of the Compensation Act, if a person recovers damages in respect of an injury from the employer liable to pay compensation under that Act, then the person ceases to be entitled to any further compensation under that Act in respect of the injury. In addition, the amount of any weekly payments of compensation already paid in respect of the injury is to be deducted from the damages and the person ceases to be entitled to participate in any injury management program provided for under the Compensation Act or under the Management Act.
Under s 151C(1) of the Compensation Act, a person to whom compensation is payable under that Act is not entitled to commence court proceedings for damages in respect of the injury concerned against the employer liable to pay the compensation until six months have elapsed since notice of the injury was given to the employer. However, under s 151C(2), the person is nevertheless entitled to commence court proceedings against the employer if either the employer wholly denies liability in respect of the injury or the employer admits partial liability, but the person is dissatisfied with the extent to which liability is admitted.
Section 315(1) of the Management Act provides that, before a claimant can commence court proceedings for the recovery of work injury damages, the claimant must serve on the defendant a pre-filing statement setting out certain particulars of the claim and certain evidence on which the claimant will rely to establish or support the claim. The pre-filing statement cannot be served unless the person on whom the claim is made wholly disputes liability or has made an offer of settlement pursuant to the determination of the claim as and when required by s 281, or the claim has not been determined as and when required by s 281. The determination of a claim in accordance with s 281 requires the making of a reasonable offer of settlement or the disputing of liability. Failure to take either action constitutes a failure to determine the claim.
Section 318A(1) of the Management Act provides that a claimant must refer a claim for work injury damages for mediation under Div 4 of Pt 6 of Ch 7 before the claimant can commence court proceedings for recovery of those work injury damages. The claim cannot be referred for mediation until at least 28 days after the pre-filing statement has been served.
Division 3 of Pt 5 of the Compensation Act applies to an award of damages in respect of an injury to a worker caused by the negligence or other tort of the worker's employer. The Division applies to such an award even though the damages are recovered in an action for breach of contract or in any other action. Section 151H(1), which is within Div 3, relevantly provides that no damages may be awarded unless the injury results in a degree of permanent impairment of the injured worker that is at least 15 percent. Section 322 of the Management Act provides that the assessment of the degree of permanent impairment is to be made in accordance with WorkCover Guidelines. Section 151G of the Compensation Act, which is also contained in Div 3, relevantly provides that the only damages that may be awarded are damages for past economic loss due to loss of earnings and damages for future economic loss due to the deprivation or impairment of earning capacity.
The effect of the provisions of the Management Act and the Compensation Act just summarised is that if, as a matter of law and fact, Mr Tomlinson was employed by Ramsey Food at the time of his injury, he would be precluded from bringing the District Court Proceedings. That is to say, he has not made a claim against Ramsey Food for lump sum compensation, he has not been paid lump sum compensation by Ramsey Food, he has not served a pre-filing statement on Ramsey Food and he has not referred his claim against Ramsey Food to a mediator. However, it must be assumed that Mr Tomlinson did all of those things in relation to Tempus, since he has received all compensation from the insurers of Tempus to which he would be entitled in respect of his injury under the Management Act and the Compensation Act had he been employed by Ramsey Food at the time of his injury and had taken the steps first described in relation to Ramsey Food.
On 30 April 2013, Mr Tomlinson filed a notice of motion in the District Court Proceedings in which he sought an order that paragraph 8 of the Defence be struck out. Directions were given that the motion be dealt with at the trial of the District Court Proceedings. At the commencement of the trial on 6 May 2013, the trial judge directed that the motion be determined following the hearing, when the evidence was complete. That is tantamount to dismissing the notice of motion and treating the issue tendered by paragraph 8 of the Defence as an issue for final determination in the trial. However, after the trial, his Honour concluded that paragraph 8 of the Defence should be struck out and made an order to that effect.
In his reasons for judgment of 17 May 2013, after the trial, the trial judge observed that it was common ground that, if Mr Tomlinson was found to have been an employee of Tempus, as he claimed, and not an employee of Ramsey Food, then his claim against Ramsey Food was governed by the provisions of the Civil Liability Act2002 (NSW) (the Civil Liability Act) and the provisions of the Compensation Act and the Management Act relied on by Ramsey Food had no application. However, counsel for Mr Tomlinson accepted during the trial that, if paragraph 8 of the Defence was "made good", it would be a complete answer to Mr Tomlinson's case in the District Court Proceedings. His Honour said in his reasons that, if he accepted Ramsey Food's contention that the Federal Court Proceedings gave rise to an issue estoppel binding him, the District Court Proceedings should be dismissed and a verdict should be entered for Ramsey Food.
Ramsey Food sought to establish in the District Court Proceedings that it was the employer of Mr Tomlinson for the purposes of the Management Act and the Compensation Act. First, it asserted that Mr Tomlinson was estopped from denying that Ramsey Food was his employer. Secondly, it asserted that, if it failed in that estoppel claim, on the evidence, the relationship between them was that of employer and employee.
The trial judge said in his reasons that the principal issue raised by the notice of motion was whether he was bound by the judgment in the Federal Court Proceedings, to the effect that Mr Tomlinson was employed by Ramsey Food at the time of his injury. His Honour concluded that there was no issue estoppel as contended for by Ramsey Food and therefore ordered that paragraph 8 of the Defence be struck out.
While the trial judge made no express finding in his reasons that, at the time of his injury, Mr Tomlinson was employed by Tempus and not by Ramsey Food, it is clear enough that his Honour reached a conclusion to that effect. His Honour went on to find, nevertheless, that Ramsey Food owed a duty of care to Mr Tomlinson to have in place and maintain a safe system of work and supervision and to organise its work activities reasonably so as to avoid foreseeable risk of injury to Mr Tomlinson. That duty, his Honour found, was analogous to that owed by an employer.

His Honour found that Ramsey Food breached that duty of care to Mr Tomlinson and that that breach of duty was a necessary condition of the occurrence of the harm occasioned to Mr Tomlinson in that, but for that breach of duty, Mr Tomlinson would not have suffered the injury that he suffered. His Honour therefore found that the elements required by s 5D(1) of the Civil Liability Act were established and that Ramsey Food's breach of its duty of care caused Mr Tomlinson's injury. His Honour also found that Mr Tomlinson did not contribute by his own negligence to his injuries. His Honour therefore found a verdict in favour of Mr Tomlinson against Ramsey Food and entered judgment in the sum of $155,069.00. In the appeal, Ramsey Food does not challenge those findings or the assessment of damages.
In dealing with the question of whether Mr Tomlinson was estopped from denying that Ramsey Food was his employer at the time of his injury, the trial judge said that the fundamental principle was that there should not be inconsistent determinations on factual findings. His Honour then made the following findings in relation to the estoppel question:
·By letter dated 16 October 2006, Ramsey Food made it clear that Mr Tomlinson's employment by it had been terminated;
·From that point on, Tempus issued payslips to Mr Tomlinson, who believed that he was employed by Tempus;
·Tempus was supplying labour to the Abattoir and Mr Tomlinson "was one of those staff";
·Tempus made payments to employees, took out a workers' compensation policy and made claims for employees on that insurance;
·Tempus issued group certificates or PAYG certificates, had tax office accounts in its name and the superannuation guarantee charge in respect of the employees was credited on behalf of Tempus.
The trial judge accepted that a person or corporation may be an employer for one purpose, but not for another purpose. However, his Honour drew no distinction between the question of whether Ramsey Food was Mr Tomlinson's employer for the purposes of his claim for entitlements made in the Federal Court Proceedings, on the one hand, and the question of whether Ramsey Food was Mr Tomlinson's employer for the purposes of the Compensation Act and the Management Act, on the other hand.
The trial judge then went on to observe that Tempus was not a party to the Federal Court Proceedings and said that, therefore, the findings of Buchanan J were not binding on it. However, whether or not Tempus was a party to the Federal Court Proceedings is irrelevant to the question of whether there was an estoppel binding on Mr Tomlinson. The question is not whether Tempus is estopped from asserting that it was the employer of Mr Tomlinson at the time of his injury. The question is whether Mr Tomlinson is estopped from asserting that Tempus was his employer at that time, and that Ramsey Food was not.
The trial judge then observed that, in bringing the Federal Court Proceedings, the Fair Work Ombudsman was carrying out a statutory function under the Fair Work Act and that, since the relief sought in the Federal Court Proceedings included declarations and consequential orders relating to statutory leave entitlements, the subject matter of the litigation in the Federal Court Proceedings was, in substance, different from the issues raised in the District Court Proceedings. That observation appears to indicate a misapprehension on his Honour's part. In considering whether an issue estoppel arises, it matters not that the relief claimed in earlier proceedings is different from the relief claimed in subsequent proceedings. That may be relevant if a defence of res judicata were raised. However, there will be an issue estoppel where an issue of fact or of law has been decided by a judicial determination in earlier proceedings between the same parties or their privies.
The trial judge then considered the question of whether there was privity of interest between Mr Tomlinson and the Fair Work Ombudsman. His Honour observed that Mr Tomlinson, and the other claimant employees in the Federal Court Proceedings, had no control of the proceedings, since they were brought by the Fair Work Ombudsman. His Honour found, therefore, that there was no privity of interest such as to attract the doctrine of issue estoppel.
Finally, the trial judge observed that, by relying on the decision of Buchanan J, Ramsey Food sought to benefit from findings made in the Federal Court Proceedings that characterised its conduct of interpositioning Tempus in the workplace structure as a sham, put in place for the purpose of avoiding its statutory obligations. His Honour, somewhat obscurely, observed that "equity would intervene to prevent such reliance" for the benefit of Ramsey Food. That observation suggests a further misconception on the part of his Honour. In the Federal Court Proceedings, Ramsey Food sought to rely on an arrangement that Buchanan J characterised as a sham. In the District Court Proceedings, Ramsey Food no longer seeks to rely on that structure. Rather, it accepts the rejection by Buchanan J of the structure and asserts in the District Court Proceedings that it was the employer of Mr Tomlinson, as Buchanan J found, and not Tempus, as it had previously contended.
The trial judge then found that "in substance" Buchanan J's decision, that Ramsey Food was not Mr Tomlinson's employer, was "not conclusively determined" by Buchanan J. Rather, his Honour said, the issue was determined for the purposes of those proceedings based only on the evidence before Buchanan J. Moreover, his Honour said, the evidence in the District Court Proceedings was clearly different and the factual determination in the District Court Proceedings was for a forensic purpose different from that of the Federal Court Proceedings. Those observations appear to evidence a further misapprehension on the part of the trial judge. If an issue is determined in earlier proceedings, the fact that there might be different evidence available in subsequent proceedings is not a basis for rejecting the estoppel that would arise from a determination of the issue in the earlier proceedings. The point of an estoppel is to preclude the re-litigation, whether or not on different evidence, of a question of fact or law that has been determined in earlier proceedings.
Finally, the trial judge reiterated his conclusion that there was no privity of interest between Mr Tomlinson and the Fair Work Ombudsman. He did not develop any reasoning for that conclusion apart from observing that the complainant employees had no control over the Federal Court Proceedings. He simply concluded that he was not bound by the findings made by Buchanan J in those proceedings. His Honour then dealt with the claim on the basis that Ramsey Food was not the employer of Mr Tomlinson.
The trial judge did not explain in his reasons why, or the respects in which, the evidence before him was different from the evidence before Buchanan J. In the absence of an estoppel, to the extent that there was no material difference, judicial comity may have required his Honour to follow the decision of Buchanan J. At least, one might have expected him to give reasons as to why he considered that Buchanan J was wrong.

The Grounds of Appeal

The principal question in the appeal is whether the trial judge erred in concluding that Mr Tomlinson was not estopped from denying that Ramsey Food was his employer at the time of his injury and striking out paragraph 8 of the Defence. The order striking out paragraph 8 might be thought to be interlocutory in nature. If so, that may raise a question as to whether Ramsey Food requires leave to appeal from that order. However, it appears that his Honour dealt with the issue on a final basis, after hearing all of the evidence. It is curious, therefore, that his Honour adopted the course of striking out paragraph 8. In any event, the appeal is from the verdict and judgment entered on 17 May 2013. In so far as the striking out of paragraph 8 was a step on the way to the verdict and judgment, it was subsumed in the judgment. Leave is not required to rely on the striking out as a ground of appeal from the verdict and judgment. If leave were required, leave should certainly be granted.
In its amended notice of appeal filed on 9 December 2013, Ramsey Food relies on the following grounds:
·The trial judge erred in finding that Mr Tomlinson was not estopped from asserting that he was not an employee of Ramsey Food as at the date of his injury;
·The trial judge erred in striking out paragraph 8 of the Defence;
·The trial judge erred in finding that, as at the date of his injury, Mr Tomlinson was not employed by Ramsey Food;
·The trial judge erred in failing to find that, since Mr Tomlinson was employed by Ramsey Food, he was not entitled to commence or pursue the proceedings against Ramsey Food and was not entitled to recover damages from Ramsey Food.
·
I shall deal first with the contention that Mr Tomlinson was bound by an issue estoppel arising out of the Federal Court Proceedings. That will entail some observations about the relevant legal principles. I shall then say something about the alternative contention that the trial judge should have found, on the evidence before him, that Mr Tomlinson was, as a matter of fact and law, employed by Ramsey Food.

Issue Estoppel

Where an issue of fact or of law is directly involved in a judicial determination, that determination will dispose of that issue once and for all. That issue cannot thereafter be raised in subsequent litigation between the same parties or their privies. Thus, an issue estoppel will arise in relation to a state of fact or law if that state of fact or law was necessarily decided by an earlier judgment, decree or order made in proceedings between the same parties or their privies. The effect of an issue estoppel is that the parties to the earlier proceedings and their privies will be precluded from alleging or denying the state of fact or law the existence of which was necessarily decided by the earlier judgment, decree or order. The estoppel is not confined to the final legal conclusion expressed in the judgment, decree or order in the earlier proceedings, but extends to any matter that it was necessary to decide, and that was actually decided, as the basis of the earlier judgment, decree or order. A state of fact or law that is cardinal to a later claim or contention cannot be raised if to do so involves a necessary assertion that the earlier judgment, decree or order was erroneous (see Blair v Curran [1939] HCA 23; 62 CLR 464 at 531-533).
The principle of issue estoppel is of some antiquity. In Roman law, the defence of res judicata included issue estoppel. The defence was available whenever the same issue was raised between the same persons, albeit in a different kind of action (Digest, 44.2.7.4). Issue estoppel is analogous to estoppel by deed and estoppel by representation (Jackson v Goldsmith [1950] HCA 22; 81 CLR 446 at 466). It is an aspect of a broad rule of public policy that is based on two principles. The first principle is interest reipublicae ut sit finis litium: it is in the interest of the state that there be an end to litigation. The second is nemo debet bis vexari pro eadem causa: no one should be harassed twice in relation to the same claim. Perhaps more significant is the principle res judicata pro veritate accipitur: a judicial decision must be accepted as incontrovertibly correct. That principle is necessary to protect against the "scandal of conflicting decisions"; issue estoppel is a mechanism that protects against conflict of that kind (see Rogers v The Queen [1994] HCA 42; 181 CLR 251 at 273-274).
For Ramsey Food to establish that Mr Tomlinson is estopped from denying that it was his employer at the time of the injury, it must demonstrate that:
·The question of whether Mr Tomlinson was an employee of Ramsey Food was decided by Buchanan J in the Federal Court Proceedings;
·The parties in the Federal Court Proceedings were Ramsey Food and Mr Tomlinson or their respective privies; and,
·The orders made in the Federal Court Proceedings were final orders.
There can be no doubt that the orders made by Buchanan J were final orders that disposed of the lis raised in the Federal Court Proceedings. The trial judge did not conclude otherwise. The basis upon which the trial judge rejected the contention that Mr Tomlinson was estopped from denying that Ramsey Food was his employer at the relevant time is not entirely exposed by his Honour's reasons. It appears, however, that his Honour concluded that the orders made by Buchanan J did not resolve the question and that the Fair Work Ombudsman was not Mr Tomlinson's privy. I shall deal separately with the questions of identity of issues and identity of parties.

Identity of Issues

So far as the Federal Court Proceedings concerned Mr Tomlinson, they were for the recovery of moneys to which Mr Tomlinson was entitled upon the termination of his employment in the Abattoir. There was no issue about the fact that he was employed to work in the Abattoir. There was no issue about the fact that his employment had been terminated. There was no issue about the fact that he was not paid the moneys to which he was entitled upon the termination of that employment. The only question litigated in the Federal Court Proceedings, so far as Mr Tomlinson was concerned, was whether Ramsey Food was liable to pay those moneys to Mr Tomlinson. The only basis upon which it could have any liability to make such a payment to Mr Tomlinson was that he was the employee of Ramsey Food for the relevant period of time, being a period of time during which Mr Tomlinson was injured in the course of his employment at the Abattoir. Buchanan J concluded that Mr Tomlinson was employed by Ramsey Food at that time. To assert the contrary is to assert that the decision of Buchanan J was erroneous.
There is no basis for suggesting that the notion or concept of employment that would give rise to a liability on the part of the employer to pay moneys to an employee upon termination of employment is different from the notion or concept of employment for the purposes of the Management Act and the Compensation Act. There is no basis for suggesting that the concept of employment, or the relationship between employee and employer, that arose in the Federal Court Proceedings is in any way different from the concept of employment, or the relationship between employee and employer, that arises for the purposes of the application of the relevant provisions of the Compensation Act and the Management Act.
The fact that the cause of action upon which the claim made in the Federal Court Proceedings was based is different from the cause of action upon which Mr Tomlinson's claim in the District Court Proceedings was based is not to the point. The claim made in the Federal Court Proceedings depended upon establishing that, at the relevant time, which included the time when Mr Tomlinson was injured, Mr Tomlinson was an employee of Ramsey Food. Mr Tomlinson can succeed in the District Court Proceedings only if he can establish that, at that same time, he was not an employee of Ramsey Food. The two assertions cannot stand together. That question was clearly resolved in the Federal Court Proceedings.
Mr Tomlinson's contentions on the identity of the issues in the Federal Court Proceedings and the District Court Proceedings are not easy to follow. He contends that his claim in the District Court Proceedings was not a work injury damages claim. That contention appears to be based on the proposition that there can only be one employer for the purposes of the Compensation Act and the Management Act. He points out that the scheme implemented by that legislation requires that an employer be insured under a prescribed form of policy. Insurers who are scheme agents for the purposes of the legislative scheme may not refuse insurance.
In fact, Tempus was a party to a relevant policy of insurance with Gallagher Bassett. A claim was made on Gallagher Bassett in accordance with the scheme established by the legislation. Gallagher Bassett made payments of compensation in the sum of $114,982.00 to Mr Tomlinson in respect of his injury. Gallagher Bassett continued to make compensation payments to Mr Tomlinson up to March 2013, well after the order made by Buchanan J in the Federal Court Proceedings. That is the extent of Mr Tomlinson's entitlement to receive compensation under s 9 of the Compensation Act.
Mr Tomlinson contended that, since his claims under the Compensation Act and the Management Act were against Tempus, and since the insurer with whom Tempus had entered into a contract of insurance had made compensation payments for weekly, medical and lump sum benefits, Tempus must be the employer for the purposes of the Management Act and the Compensation Act. However, at one point during oral argument, he eschewed the proposition that the employer, for the purposes of that legislative scheme, is the person who is the party to an insurance contract.
Section 155 of the Compensation Act requires that an employer be insured, subject to exceptions for self-insured employers that are not presently relevant. Whether or not an entity that is, as a matter of fact and law, the employer of an employee has in fact satisfied that insurance obligation has nothing to do with the question of whether or not the relationship of employer and employee exists so far as that entity is concerned. The enquiry must be as to the relationship between Mr Tomlinson and Ramsey Food. Mr Tomlinson would have been precluded from bringing the claims that he made in the District Court Proceedings if, as a matter of fact and law, the relationship between them was that of employer and employee. That question was decided in the Federal Court Proceedings. Thus, the very issue that arose in the District Court Proceedings was decided in the Federal Court Proceedings.

Identity of Parties

However, identity of issues is not of itself sufficient to attract an issue estoppel. Ramsey Food must also demonstrate that the parties in the District Court Proceedings, or their privies, are the same as the parties in the Federal Court Proceedings. Mr Tomlinson relies on the fact that the applicant in the Federal Court Proceedings was the Fair Work Ombudsman and that he himself was not a party. The question is whether the Fair Work Ombudsman was Mr Tomlinson's privy.
Before a party in subsequent proceedings will be estopped by privity, it must be shown that the party had some interest, legal or beneficial, in the previous litigation or its subject matter. Privity may be described as a mutual or successive relationship to the same right of property. Privity is a matter of substance, not form (see KR Handley, Spencer Bower & Handley, Res Judicata (4th ed 2009, LexisNexis Butterworths) at [9.38]).
The requirement of identity of parties for the purposes of an estoppel is satisfied where there is privity in interest. The necessary identity in interest may arise from a successive relationship in a temporal sense or with privies by operation of law, such as between a deceased and his or her legal personal representative. The relationship of privy may also exist where, whilst not successive in that sense, the relationship is mutual (Trawl Industries of Australia Pty Ltd (In Liq) v Effem Foods Pty Ltd [1992] FCA 272; 36 FCR 406 at 413). The basic requirement of a privy in interest is that the privy must claim under or through the person of whom he is said to be a privy. Where one party has no interest in the action to which the alleged privy is a party, the requisite relationship will not exist (Ramsay v Pigram [1968] HCA 34; 118 CLR 271 at 279).
The position of the Fair Work Ombudsman is a curious one. The Fair Work Ombudsman is established by s 681 in Pt 5-2 of the Fair Work Act. In that Part, by the operation of s 680, employee and employer have their ordinary meanings. Under s 682(1), the functions of the Fair Work Ombudsman are:
(a)to promote harmonious, productive and co-operative workplace relations and compliance with the Fair Work Act and fair work instruments;
(b)to monitor compliance with the Fair Work Act and fair work instruments;
(c)to enquire into, and investigate, any act or practice that may be contrary to the Fair Work Act or a fair work instrument;
(d)to commence proceedings in a court to enforce the Fair Work Act or fair work instruments;
(e)to refer matters to relevant authorities;
(f)to represent employees who are, or may become, a party to proceedings in a court under the Fair Work Act or a fair work instrument, if the Fair Work Ombudsman considers that representing the employees will promote compliance with the Fair Work Act or the fair work instrument;
(g)any other functions conferred on the Fair Work Ombudsman by any Act of the Commonwealth.

Ramsey Food relies on two possible functions of the Fair Work Ombudsman to justify its contention that he was Mr Tomlinson's privy for the purposes of the claim brought in the Federal Court Proceedings. One is the function set out in s 682(1)(f) of the Fair Work Act, namely, to represent employees who are, or may become, a party to proceedings in a court under the Act or a fair work instrument. The Federal Court Proceedings were, clearly enough, proceedings in a court under a fair work instrument in so far as the Fair Work Ombudsman sought to enforce the terms of the Award (discussed in more detail below at [88]). However, it is by no means clear that the function of representing an employee, as contemplated by s 682(1)(f), extends to commencing a proceeding in the name of the Fair Work Ombudsman in which a claim is made for the payment of a sum of money to an employee who is not technically a party to the proceedings.
In that context, the term "represent" is probably limited to representing in the sense of acting as the agent of, appearing on behalf of, or in lieu of, an employee. For example, the Fair Work Ombudsman might cause proceedings to be commenced in the name of an employee by giving instructions for the preparation and filing of initiating process. The Fair Work Ombudsman might then appear on behalf of the employee in court when the proceedings come before the court. That meaning is suggested by the use of the phrase "employees ... who are, or may become, a party to proceedings". That language suggests that the Fair Work Ombudsman would not represent an employee in a case where proceedings were commenced in the name of the Fair Work Ombudsman, rather than in the name of the employee who is or wants to become a party to proceedings.
In performing the function of representing employees who are, or may become, a party to proceedings in a court, the Fair Work Ombudsman would not be performing a function akin to that of a procurator under Roman law, where a person could be appointed to act as a litigation agent for the purposes of conducting litigation on behalf of another (Institutes, 4.10).
The other function of the Fair Work Ombudsman relied on by Ramsey Food is that set out in s 682(1)(d), namely, to commence proceedings in a court to enforce a fair work instrument. The Award was a fair work instrument for the purposes of that provision, even though it came into force before the commencement of the Fair Work Act on 1 July 2009, when that Act replaced the Workplace Relations Act. That is because sub-item 13(2)(a) of Sch 18 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) provides that Pt 5-2 of the Fair Work Act (which contains s 682) applies in relation to conduct that occurred before the repeal of the Workplace Relations Act as if a reference to a fair work instrument were a reference to a "WR Act instrument". Then, sub-item 2(2)(a) of Sch 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act provides that an award, inter alia, is a "WR Act instrument". In so far as the Federal Court Proceedings were brought to enforce compliance by Ramsey Food of a liability as Mr Tomlinson's employer arising under the Award, the Fair Work Ombudsman was performing the function set out in s 682(1)(d). That, of itself, may not necessarily make the Fair Work Ombudsman Mr Tomlinson's privy.
However, throughout his reasons of 19 October 2011, Buchanan J referred to Mr Tomlinson when using the phrase "complainant employees". In addition, Mr Tomlinson swore an affidavit that was relied on by the Fair Work Ombudsman in the Federal Court Proceedings. Finally, as I have indicated, Buchanan J made declarations and orders referring specifically to Mr Tomlinson.
In those circumstances, the Fair Work Ombudsman asserted Mr Tomlinson's claim against Ramsey Food. Mr Tomlinson participated in that claim, by providing affidavit evidence in support of it. Declarations and orders were made for his benefit. He participated in the proceedings and an inference is clearly available that he authorised the Fair Work Ombudsman to make the claim on his behalf.
While the Fair Work Ombudsman may have been acting in the public interest in seeking penalties from Ramsey Food in the Federal Court Proceedings, there can be no doubt that the Fair Work Ombudsman was also making claims under s 719 of the Workplace Relations Act on behalf of the claimant employees, including Mr Tomlinson. The Fair Work Ombudsman had no entitlement to moneys payable by the employer of the claimant employees upon the termination of their employment. It was seeking to enforce, and did enforce, the rights vested in the employees, including Mr Tomlinson, under the Award. In so far as the Fair Work Ombudsman was enforcing Mr Tomlinson's entitlement, under the Award, to a payment in lieu of notice and a severance payment, the Fair Work Ombudsman was doing so on behalf of Mr Tomlinson. The Fair Work Ombudsman was Mr Tomlinson's privy for the purposes of the application of the doctrine of issue estoppel.

Conclusion as to Issue Estoppel

The issue raised by paragraph 8 of the Defence, of whether Mr Tomlinson was employed by Ramsey Food at the time of his injury, was the principal issue determined by the final declarations made in the Federal Court Proceedings. While Mr Tomlinson was not a party to the Federal Court Proceedings, the Fair Work Ombudsman was his privy for the purposes of determining that issue. Mr Tomlinson is therefore estopped from asserting that, at the time of his injury, he was not employed by Ramsey Food. The trial judge erred in striking out paragraph 8 of the Defence. The question raised by paragraph 8 should have been determined in favour of Ramsey Food. Therefore, his Honour ought to have entered a verdict and judgment for Ramsey Food.

Finding as to Employment

Having regard to the conclusion that I have reached on the question of issue estoppel, it is not necessary to deal with the final ground of appeal that, in the absence of an estoppel, the trial judge erred in concluding that Mr Tomlinson was not an employee at the time of his injury. However, I shall say something about the evidence and the findings on that question.
Mr Michael Considine commenced as the plant manager at the Abattoir in 2005. He was directly answerable to Mr Ramsey. In October 2006, Mr Considine was appointed as the sole director of Tempus and remained as sole director until January 2010. He ceased to be a director of Tempus following a conversation that he had with Mr Ramsey and Mr Ramsey's solicitor, Mr Hannigan. A corporation controlled by Mr Considine was the only shareholder of Tempus and he executed the October Deed on behalf of Tempus. However, he himself took no steps to establish Tempus. The documents in respect of Tempus arrived on his desk following a conversation with Mr Ramsey. Following the incorporation of Tempus and the appointment of Mr Considine as a director, Mr Considine's duties with Ramsey Food did not change. There was no change in the way that work was carried out at the Abattoir after Tempus was incorporated. Mr Considine had no part to play in the approval of holiday leave, the employment of anyone, or the training of employees who were paid by Tempus. The way in which Mr Considine was paid did not change. The trial judge found that Mr Considine had a desire to be indemnified by Mr Ramsey in respect of any "ongoing issues that may have occurred at the Abattoir".
When asked whether the October Deed was honest or dishonest, Mr Considine responded that it had previously been called "a sham". However, he said that he was not attempting to be dishonest when he executed the October Deed and that it was the truth that Tempus was supplying labour to the Abattoir, including the labour of Mr Tomlinson.
Mr Considine accepted in cross-examination that he was, or had been, a director of a number of corporations. He was familiar with the statutory obligations of corporations with respect to employees and the keeping of records and was aware that it was a compulsory obligation in New South Wales for employers to have a workers' compensation policy. He confirmed in further evidence that Tempus had taken out a workers' compensation policy, that group certificates or PAYG certificates went out in the name of Tempus, and that Tax Office accounts were credited on the basis that the employees were employed by Tempus. He agreed that the superannuation guarantee charge was credited on behalf of Tempus for each of the employees.
Tempus paid the complainant employees, including Mr Tomlinson. Ramsey Food transferred to Tempus on a weekly basis the money necessary to make those payments, without any documentation and without Tempus having to do anything. Tempus derived no benefit from the arrangements and did not have any income from any activities that it undertook. Tempus generated no income of its own and did not charge a fee to Ramsey Food for the provision of labour.
In October 2006, without prior consultation or notice, Mr Considine informed the employees, including Mr Tomlinson, that, henceforth, they would be paid by a different entity, namely, Tempus. They were told that nothing would change, other than the name of the company on their payslips. Mr Tomlinson and the other employees working at the Abattoir were asked to sign forms. Mr Tomlinson signed the form that he was asked to sign. Without any further discussion, he received a letter informing him about the existence of Tempus. Thereafter, nothing else changed at the workplace. Mr Tomlinson had the same supervisor, worked the same job and the same hours. Mr Tomlinson continued to report to the same supervisor and took pay enquiries to the same person, Mr Marshall. Mr Tomlinson wore the same uniform throughout. He did not receive any outstanding benefits from Ramsey Food in October 2006 that would have been payable on termination of his employment. He continued to remain under the control of Ramsey Food at all times. The pay of the employees, including Mr Tomlinson, continued to be determined and made out by Mr Marshall, who appears to have been an employee of Ramsey Food. There was no evidence of any training, manuals, directions or work procedures ever being issued by Tempus. Apart from the fact that the payments were made by Tempus to Mr Tomlinson, none of the indicia of employment as between Ramsey Food and Mr Tomlinson, as they had existed prior to October 2006, changed.
On the basis of the evidence before the trial judge, I would be disposed to reach the conclusion that was reached by Buchanan J, namely, that Mr Tomlinson continued to be employed by Ramsey Food. However, the effect of my earlier conclusion is that Mr Tomlinson is estopped from asserting that the contrary is the position. It is therefore not necessary to determine whether the trial judge erred in concluding, on the evidence before him, that Mr Tomlinson was not an employee of Ramsey Food at the time of his injury.

Further Contentions

No notice of contention was filed on behalf of Mr Tomlinson. However, in his written submissions, he raised what appear to be alternative grounds for upholding the decision of the trial judge that paragraph 8 of the Defence should be struck out. First, he contended that Ramsey Food was bound by an estoppel by deed. Secondly, he contended that Tempus should be a party to the District Court Proceedings. Thirdly, he relied on public policy. I shall deal with each of the contentions separately.

Estoppel by Deed

Estoppel by deed is a rule of evidence founded on the principle that a solemn and unambiguous statement or engagement in a deed must be taken as binding as between parties to the deed and their privies. A party to a deed, and the privies to that party, will be estopped from adducing evidence to contradict a statement contained in that deed (Dong v Monkiro Pty Ltd [2005] NSWSC 749 at [68]-[69]). On one view, estoppel by deed is a form of estoppel by convention. In such a case, the estoppel will arise where an assumption is made as the basis upon which the parties enter into a relationship. Either party would be estopped from departing from that assumption if to do so would cause detriment to the other (see Grundt v Great Boulder Pty Gold Mines Ltd [1937] HCA 58; 59 CLR 641 at 674-5; Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd [1986] HCA 14; 160 CLR 226 at 244-5).
However, before the commencement of the District Court Proceedings, there had been no suggestion that Mr Tomlinson acted to his detriment on the assumption that he was employed by Tempus. While the October Deed may have given rise to an estoppel as between the parties to it, namely, Tempus and Ramsey Food, or their privies, that has nothing to do with the present case. Mr Tomlinson was not a party to the October Deed.

Joinder of Tempus

Mr Tomlinson contends that the stance adopted by Ramsey Food would lead to the conclusion that the rights of Tempus would be affected by a finding in proceedings to which it is not a party. On one view, that appears to be a contention that the District Court Proceedings were defective for want of joinder of a party whose interests were affected. That is hardly a complaint that can be made by Mr Tomlinson as the plaintiff. In any event, the contention is misconceived. Since Tempus was not a party to the District Court Proceedings, it will not be bound by any verdict or judgment in the District Court Proceedings.
Mr Tomlinson contends that the consequence of the stance adopted by Ramsey Food is that Tempus would lose its protection under Ch 7 of the Management Act, if the appeal were upheld, notwithstanding that it is not a party to these proceedings. He says that both Tempus and its public liability insurers would be affected and therefore should be joined as parties. Again, the contention is misconceived. A judgment or verdict in favour of Ramsey Food in the District Court Proceedings would have no effect whatsoever on the relationship between Tempus and its insurers. The result of the District Court Proceedings and this appeal could have no bearing on the rights and obligations as between Tempus and Mr Tomlinson or as between Mr Tomlinson and any insurer of any liability of Tempus.

Public Policy

Mr Tomlinson contends that, for reasons of public policy, Ramsey Food should not be permitted to use the Court of Appeal to benefit from, or further, the sham consisting of arrangements made to avoid payment of penalties ordered by the Federal Court and that the sham ought not be put to further use to defeat Mr Tomlinson's claims. Further, Mr Tomlinson says, Ramsey Food, as his previous employer, being in a position of power and trust, with implied duties of mutual trust and confidence, should not be permitted to assert a contrary arrangement to the one from which it sought to derive benefit to the detriment of Mr Tomlinson. He says that Ramsey Food itself was estopped from making an assertion in the District Court Proceedings that is inconsistent with the stance that it adopted in the Federal Court Proceedings.
The contentions seem to be misconceived. Ramsey Food did no more in the District Court Proceedings than seek to assert the position that had been solemnly found to exist by declarations and orders of the Federal Court of Australia, a superior court of record. It had resisted the making of those declarations and orders, but failed in that resistance. It would be extraordinary to conclude that, by accepting the decision of a superior court of record, Ramsey Food was acting contrary to public policy. Rather, on one view, the stance adopted by Mr Tomlinson in the District Court Proceedings and in the Court of Appeal is itself an abuse of process and is contrary to public policy, insofar as he has obtained a judgment in the District Court Proceedings that is inconsistent with the judgment obtained on his behalf in the Federal Court Proceedings. Whatever criticism may be directed at Ramsey Food and its advisers for the stance it adopted unsuccessfully in the Federal Court Proceedings, it is doing no more in the District Court Proceedings, and in this appeal, than to adopt the findings, declarations and orders made by Buchanan J. That could not be contrary to public policy.

Conclusion

The trial judge erred in not concluding that Mr Tomlinson was estopped from denying that Ramsey Food was his employer at the time of his injury. His Honour should have concluded that the claim made in the District Court Proceedings was precluded by the operation of the provisions of the Management Act and the Compensation Act relied on by Ramsey Food in paragraph 8 of the Defence.
In those circumstances, the following orders should be made:
(1)To the extent necessary, leave be granted to appeal from the order made on 13 May 2013 that paragraph 8 of the defence filed by the appellant be set aside.
(2)The appeal be allowed.
(3)The orders made by the District Court on 13 May 2013 be set aside and, in lieu of those orders, there be substituted verdict and judgment for the defendant and an order that the plaintiff pay the defendant's costs.
(4)The respondent pay the appellant's costs of this appeal.
(5)The respondent, if otherwise qualified, be granted a certificate under the Suitors' Fund Act1951 (NSW).
**********

Case Title:	Ramsey Food Processing Pty Ltd v Tomlinson
Medium Neutral Citation:	[2014] NSWCA 237
Hearing Date(s):	22/05/2014
Decision Date:	21 July 2014
Before:	Meagher JA at [1]; Ward JA at [22]; Emmett JA at [23]
Decision:	1 To the extent necessary, leave be granted to appeal from the order made on 13 May 2013 that paragraph 8 of the defence filed by the appellant be set aside. 2 The appeal be allowed. 3 The orders made by the District Court on 13 May 2013 be set aside and, in lieu of those orders, there be substituted verdict and judgment for the defendant and an order that the plaintiff pay the defendant's costs. 4 The respondent pay the appellant's costs of this appeal. 5 The respondent, if otherwise qualified, be granted a certificate under the Suitors' Fund Act 1951 (NSW). [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	ESTOPPEL - former adjudication - issue estoppel - matters necessary to the decision - identity of parties - whether the Fair Work Ombudsman was the privy of the respondent employee in earlier proceedings - whether the issue of the respondent's employment by the appellant had been decided in the earlier proceedings EMPLOYMENT LAW - the relationship of employer and employee - whether the respondent was an employee of the appellant - whether that relationship was affected by a company inter-positioned between the appellant and respondent
Legislation Cited:	Civil Liability Act 2002 (NSW), s 5D Civil Procedure Act 2005 (NSW), s 100 Fair Work Act 2009 (Cth), ss 680, 681, 682 Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth), Sch 3, Sch 18 Federal Meat Industry (Processing) Award 2000, cll 9, 10 Workers Compensation Act 1987 (NSW), ss 3, 9, 9A, 151A, 151C, 151H, 151G, 155 Workplace Injury Management and Workers Compensation Act 1998 (NSW), ss 4, 250, 280A, 280B, 281, 315, 318A, 322 Workplace Relations Act 1996 (Cth), ss 717, 719
Cases Cited:	Blair v Curran [1939] HCA 23; 62 CLR 464 Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd [1986] HCA 14; 160 CLR 226 Dong v Monkiro Pty Ltd [2005] NSWSC 749 Fair Work Ombudsman v Ramsey Food Processing Pty Ltd [2011] FCA 1176; 198 FCR 174 Grundt v Great Boulder Pty Gold Mines Ltd [1937] HCA 58; 59 CLR 641 Jackson v Goldsmith [1950] HCA 22; 81 CLR 446 Ramsay v Pigram [1968] HCA 34; 118 CLR 271 Rogers v The Queen [1994] HCA 42; 181 CLR 251 Trawl Industries of Australia Pty Ltd (In Liq) v Effem Foods Pty Ltd [1992] FCA 272; 36 FCR 406 Withyman (by his tutor Glenda Ruth Withyman) v State of New South Wales [2013] NSWCA 10
Texts Cited:	Justinian's Digest, 44.2.7.4 Justinian's Institutes, 4.10 KR Handley, Spencer Bower & Handley, Res Judicata (4th ed 2009, LexisNexis Butterworths)
Category:	Principal judgment
Parties:	Ramsey Food Processing Pty Ltd (Appellant) Grant Tomlinson (Respondent)
Representation
- Counsel:	Counsel: R Cavanagh SC with K Andrews (Appellant) R Goodridge (Respondent)
- Solicitors:	Solicitors: A R Conolly & Company (Appellant) Monaco Solicitors (Respondent)
File Number(s):	2013/172501
Decision Under Appeal
- Before:	Mahony DCJ
- Date of Decision:	17 May 2013
- Citation:	Grant Tomlinson v Ramsey Food Processing Pty Ltd [2013] NSWDC 64
- Court File Number(s):	2011/194262
Publication Restriction:	Nil