Rohy's Maintenance Services Pty Limited v Anderson - [2012] NSWWCCPD 72

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Rohy’s Maintenance Services Pty Limited v Anderson and ors [2012] NSWWCCPD 72
APPELLANT:		Rohy’s Maintenance Services Pty Limited
FIRST RESPONDENT:		Kevin Anderson
SECOND RESPONDENT:		Eco Choice Projects Pty Limited
THIRD RESPONDENT:		Yadollah Shaykholislami t/as Classic Finishes
INSURER:		CGU Insurance Limited
FILE NUMBER:		A1-9973/10
ARBITRATOR:	Mr Perrignon
DATE OF ARBITRATOR’S DECISION:		9 May 2012
DATE OF APPEAL DECISION:		28 November 2012
SUBJECT MATTER OF DECISION:		Contractor; Sch 1 cl 2 of the Workplace Injury Management and Workers Compensation Act 1998; whether work was not incidental to a trade or business regularly carried on by the contractor in the contractor’s own name or under a business or firm name; onus of proof of matters provided by Schedule; challenge to Arbitrator’s finding as to credit of witness.
PRESIDENTIAL MEMBER:		Deputy President Kevin O'Grady
HEARING:		Oral
REPRESENTATION:		Appellant:	Mr P Stockley, instructed by Bartier Perry Lawyers
First Respondent:	Mr P Perry, instructed by Taylor & Scott
Second Respondent:	Mr L Morgan, instructed by Berry Buddle Wilkins Lawyers
Third Respondent:	Mr P Stockley, instructed by Bartier Perry Lawyers
ORDERS MADE ON APPEAL:		1. The determinations and orders made in paragraphs one, two, five, six, eight and nine of the Certificate of Determination dated 9 May 2012 are revoked. 2. Paragraph four is amended by its deletion and substitution as follows: “Awards for the First, Second and Third Respondents”. 3. No order as to costs of the appeal.

BACKGROUND

Kevin Anderson, formerly known as Ryan Hansen, Ebrahim Habibzadeh, Tony Parker and Ebrahim Khalil Habibzadeh, a painter by trade, alleged that he received injury in the course of work performed by him at the Star City Casino Sydney in 2009.
A claim for workers compensation benefits was made against three alleged employers being Rohy’s Maintenance Services Pty Limited (the appellant), Eco Choice Projects Pty Limited (Eco Choice) and Yadollah Shaykholislami trading as Classic Finishes. Those claims were denied.
The dispute concerning Mr Anderson’s entitlement to compensation benefits was the subject of an Application to Resolve a Dispute (the Application) which was filed with the Commission in December 2010. That Application alleged injury to Mr Anderson’s right shoulder together with “depression/anxiety” resulting from the “nature and conditions of employment for several weeks leading up to and including 18 June 2009 and again thereafter up to early August 2009”. The nature of the claim made against each of the named respondents was not clearly defined in the Application.
The matter came before Arbitrator Perrignon for conciliation/arbitration on 9 May 2011. The matter did not conclude on that day. Proceedings were conducted on three subsequent days being 29 August 2011, 26 October 2011 and 14 December 2011. The proceedings were sound recorded and a transcript (T) has been produced.
It is clear that proceedings were commenced against the appellant and the other two respondents given Mr Anderson’s uncertainty as to the correct identity of the party against whom he should bring his claim. It was recorded by the Arbitrator on the first day of hearing that there was a “central issue” in the proceedings being whether Mr Anderson was “in fact a worker within the meaning of the Act or a deemed worker within the meaning of one of the schedules to the 1998 Act”. Whilst there is no reference to an allegation of “deemed employment” to be found in the Application, it was made clear that, as an alternative to his primary allegation concerning employment, Mr Anderson placed reliance upon the provisions of cl 2(1) of Sch 1 to the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act).
On the last day of hearing the Arbitrator made directions concerning the provision by the parties of written submissions as to quantum of entitlement should there be an award made in favour of Mr Anderson.
A Certificate of Determination, accompanied by a Statement of Reasons (Reasons), issued on 9 May 2012. That Certificate records the following determinations and orders:
“The Commission determines:

1.       From March 2007 to 30 July 2009, the Applicant contracted with the First Respondent to perform work exceeding $10 in value, not being work incidental to a trade or business regularly carried on by the Applicant in his own name, or under a business or firm name.
2. From March 2007 to 30 July 2009, the Applicant is deemed by Schedule 1.2 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) to have been employed by the First Respondent.
3.       The Applicant was not an employee, or a deemed employee, of the Second or Third Respondent.
4.       Awards for the Second and Third Respondent.
5.       On 17 June 2009, Mr Anderson suffered a partial thickness tear of the right supraspinatus tendon while painting the ceiling at Star City Casino in the course of his deemed employment for the First Respondent, to which his deemed employment contributed substantially.
6.       Due to the nature and conditions of his work as a painter for the First Respondent in May and June 2009, he suffered injury to the right shoulder.
7.       Award for the First Respondent in respect of the claim for weekly compensation from 19 June 2009 to 26 July 2009.
8.       Award of weekly compensation as against the First Respondent as follows.

(a)For the period 3 August 2009 to 19 August 2009, at the rate of $653.88 per week pursuant to section 36 of the Workers Compensation Act 1987 (‘the 1987 Act’).

(b)For the period 20 to 26 August 2009 (making allowance for amounts paid by Inspired Group), at the rate of $477.35 per week, pursuant to section 40.

(c)For the period 27 August 2009 to 31 December 2009, at the rate of $653.88 per week pursuant to section 36.

(d)For the period 1 to 16 January 2010, at the rate of $575.10 per week pursuant to section 37.

(e)For the period 17 to 23 January 2010 (making allowance for amounts paid by Oriental Painting), at the rate of $367.35 per week pursuant to section 40.

(f)For the period 24 January 2010 to 4 February 2010, at the rate of $575.10 per week pursuant to section 38.

(g)For the period 5 to 11 February 2010 (making allowance for amounts paid by Oriental Painting), at the rate of $217.35 per week pursuant to section 40.

(h)For the period 12 February 2010 to 31 March 2010, at the rate of $575.10 per week pursuant to section 37.

(i)For the period 1 April 2010 to 30 June 2010, at the rate of $586.10 per week pursuant to section 37.

(j)For the period 1 July 2010 to 30 September 2010, at the rate of $586.10 per week pursuant to section 37.

(k)For the period 1 October 2010 to 9 December 2010, at the rate of $594 per week pursuant to section 37.

(l)For the period 10 December 2010 to date and continuing, at the rate of $594 per week pursuant to section 37.

9. The First Respondent is to pay the Applicant’s costs of the proceedings as agreed or assessed, and I certify the matter as complex and allow an uplift of 30 per cent for all parties.

A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”

ISSUES IN DISPUTE

The issues in dispute are whether the Arbitrator erred in the following respects:
(a)     determining that Mr Anderson was “engaged in deemed employment with the appellant” (Sch 1.2 of the 1998 Act);
(b)     in his determination of factual matters which concerned the credibility of Mr Anderson;
(c)     rejecting the appellant’s tender of statements by Mr Mohammad, a director of the appellant, and of Mrs Mohammad;
(d)     failing to give adequate reasons for his determination, and
(e)     in finding that Mr Anderson was totally incapacitated for work.

HEARING

Having regard to the complexities of the evidence and the arguments raised on appeal, it was determined that a hearing should be conducted. The matter was heard on 30 October 2012. Each party was represented by counsel. A transcript of the appeal hearing (TA) has been produced.

THRESHOLD MATTERS

There is no dispute between the parties that the threshold requirements as to quantum and time as found in the provisions of ss 352(3) and s 352(4) of the 1998 Act have been met.

FRESH EVIDENCE

The appellant seeks an order pursuant to s 352(6) of the 1998 Act with respect to the admission of evidence in addition to that which was admitted before the Arbitrator. That material is described at 2.5 of the Application brought with respect to this appeal. Copies of the documents relevant are annexed to that Application. That material is a statement by Mr Saeed Mohammad, a director of the appellant, dated 8 September 2011 and a statement by his wife Mariana Mohammad dated 8 September 2011 together with attachments.
The additional evidence which is the subject of this application had been tendered on behalf of the appellant before the Arbitrator at the hearing during proceedings on 14 December 2011. Objection was taken to that tender, and a ruling was made by the Arbitrator rejecting the admission of the material as late evidence. I note that at the hearing of this appeal counsel appearing on behalf of the appellant, Mr Stockley, made it clear that among the appellant’s complaints made on this appeal was an allegation that the Arbitrator had erred in rejecting the tender of that material.
Having regard to my conclusion concerning the merits of this appeal, I have formed the view that it is appropriate to refuse the application made on behalf of the appellant concerning this additional evidentiary material. Reasons for that conclusion are shortly stated at [118] below. My findings on this appeal are made upon grounds which do not concern those matters addressed by Mr Mohammad in that statement which is the subject of this application. Given my view that much of the pertinent evidence found in the statement of Mrs Mohammad is to be found in the material before the Arbitrator (in particular those documents annexed to the Application to Admit Late Documents filed by Bartier Perry, received by the Commission on 31 May 2011), justice does not require a grant of leave to adduce that additional evidence. I make the observation that, were the statements admitted and the appeal was to succeed, it would be arguable that the matter should be remitted for redetermination. In the circumstances the appellant’s application is formally refused.

THE ARBITRAL PROCEEDINGS

At the hearing conducted before the Arbitrator on 29 August 2011, rulings were made concerning the admission of a large number of documents. That documentary evidence was noted by the Arbitrator at [9] of his Reasons. It was agreed that Mr Mohammad was a director of both the appellant and Eco Choice. Whilst it was denied that Mr Anderson was at relevant times a worker or a deemed worker, it was not alleged that he, at any relevant time, employed any worker to perform any of the work which was carried out.
Applications were made on behalf of each of the putative employers seeking leave to cross-examine Mr Anderson. The Arbitrator granted such leave, subject to directions which he subsequently made concerning the duration of cross-examination and the subject matter in respect of which that leave had been granted. Cross-examination commenced on 29 August 2011 at which time Mr Anderson did not have the benefit of an interpreter fluent in the Farsi language. During the course of cross-examination, Mr Anderson made statements indicating that he had difficulty understanding questions and that his command of the English language was not great. Counsel is recorded (at T74, 29 August 2011) as stating that, given the manner of response by Mr Anderson to cross-examination, “perhaps we need a Farsi interpreter, Mr Arbitrator”. Such an interpreter was not available on that day and cross-examination of Mr Anderson was suspended. Arrangements were made for the attendance of an appropriately qualified interpreter at the adjourned hearing conducted on 26 October 2011.
The evidence before the Arbitrator included two statements made by Mr Anderson tendered in his case as well as two further statements made by him which were relied upon by the appellant and Mr Shaykholislami. In a statement dated 18 November 2010 Mr Anderson described the nature of his relationship with the appellant. It is there stated that he “commenced working for [the appellant] as a painter in about 2006. Prior to that I worked for Rohy’s Painting Pty Limited from 2004 to 2006. The boss of [the appellant] is Saeed Mohammad and it is that gentleman with whom I had all my dealings for the company”.
Mr Anderson further stated that he operated under a business name of AM and PM Painting at Mr Mohammad’s request and that he had his “own ABN”. He regarded himself as an employee of the appellant. The arrangement between himself and the appellant was described in that statement as follows:
“[The appellant] would pick the painting jobs and direct me where to go, provide me with all the materials and I would perform the job I was requested to do. I would send invoices on a regular as needs basis and I dispute that invoices were only sent when jobs were completed. I would say in very general terms that when I was working for Rohy’s I would earn up to about $1,400 per week for a 6 day week, although the work was not full time.”
Among documents annexed to Mr Anderson’s statement were a number of invoices issued in the name AM & PM Painting between 20 February 2007 and 31 July 2009. The detail of that evidence is considered below. Mr Mohammad, it was stated, “would direct who I should make my invoices to, the majority of the time it was [the appellant] but on occasions in particular during June 2009 it was to [Eco Choice]”.
Mr Anderson tendered copies of three worker’s injury claim forms completed by him addressed to each of the putative employers. Those forms included a statement that Mr Anderson worked a 48 hour week being between Monday and Saturday and that his usual pre-tax weekly earnings were in the sum of $1,400 per week.
Mr Anderson’s statement includes reference to “inaccuracies” concerning his income as stated in the claim form. Reference is made to “relevant tax invoices” annexed to the statement, and Mr Anderson stated that his income was “about $43,190 for the previous financial year up to June 2009”. He further stated that work for the appellant was the only work that he did and that he was not contracting out to work for other companies during that period.
In a supplementary statement dated 29 March 2011 Mr Anderson stated as follows:
“11. I formed the business name AM and PM Painting in response to a condition imposed by Mr Saeed Mohammad for my working for Rohy’s Maintenance Services Pty Limited. AM and PM Painting is a business name only. From the commencement of my work with Rohy’s Maintenance Services Pty Limited, I worked exclusively for or at the direction of Mr Mohammed [sic].
12. I did not advertise, nor did I seek work from any person other than Mr Mohammed [sic]. Neither I personally, nor AM and PM Painting ever sublet any contract, nor did I hire any other worker.
13. I did not, at any time either before or after the date on which I first started to work for Mr Mohammad, carry on a trade or business, either in my own name or in any other name. I worked for Mr Mohammed [sic] or at his direction.”
In a statement made 11 November 2009, which had been tendered on behalf of the appellant and the third respondent, Mr Anderson stated, concerning work performed by him for the appellant, as follows:
“On a normal week I would work 48 hours, commencing 7.00 am – 4.00 pm usually Monday to Saturday. I would be paid according to the tax invoice according to the hours that were worked $250 per day. I did not work overtime. I did not every [sic, ever] claim sick leave and be paid for it. In the past year I would have earned $75,000. That sum is entirely from Rohy’s Maintenance, I have not worked for anyone else.”
Mr Anderson tendered six delivery dockets issued by Dulux Australia which nominated the customer as being the appellant company which were dated between April 2009 and July 2009. Those dockets make reference to “Tony” or “Tony Parker”, the name by which Mr Anderson was previously known. This material is discussed below.
The documents tendered on behalf of Mr Anderson include medical reports from Dr Hamid and Dr Ian Collins. That evidence establishes that Mr Anderson had been diagnosed as having suffered a torn rotator cuff of the right shoulder. Those medical practitioners attributed the shoulder injury to work performed by Mr Anderson as described by him which involved the painting of a ceiling. It was Dr Hamid’s opinion, expressed in his report of 15 November 2010, that Mr Anderson had developed major depression and anxiety which was stated to be “due to his lack of daily expenses and difficulty to pay the rent. He does not have a place to live in and is in poor physical and mental health.” Dr Hamid expressed the view that he was then unfit for any work. Dr Collins, in his report dated 1 December 2009 expressed the view that Mr Anderson was then not fit for work as a painter.
The balance of the documents tendered on behalf of Mr Anderson need not be summarised. However, reference is made to relevant material in the course of discussion below.
The evidence tendered on behalf of the appellant and Mr Shaykholislami included a statement made by Mr Saeed Mohammad dated 5 November 2009. Mr Mohammad stated that he is the sole director of the appellant company and that his wife, Mariana, is the office manager. He has owned the appellant company since 2003 and Mr Anderson, known to Mr Mohammad as Tony Parker, began “to subcontract” with the appellant in April 2007 at which time Mr Anderson’s business name was Atlantic Painting, the ABN of which business was the same as the ABN used by Mr Anderson for the business name AM and PM Painting. It is stated that Mr Anderson changed both the name of his business in dealings with the appellant, and his own name, in June 2008. It is again stated that Mr Anderson was a subcontractor and further that he was not entitled to superannuation. Mr Mohammad stated that documents held by him include a certificate of currency and tax invoices submitted by Mr Anderson in respect of work performed. Mr Anderson was not an employee drawing wages nor were any statutory deductions made from payments made to him. The work awarded to Mr Anderson comprised small projects. Mr Anderson would be supplied with “the scope of works including program for project completion. When the project was complete Mr Anderson would issue us his invoice”. The only documentation in respect of work performed were the invoices and copies of Mr Anderson’s workers compensation policy currency documents.
It is further stated by Mr Mohammad that Mr Anderson had been on holidays overseas with his wife and child for approximately two months before the alleged injury. Mr Mohammad believed that Mr Anderson went overseas in April 2009, but stated that he would “have to check that”. Upon his return to Australia Mr Anderson was not in the company of his wife and child. Mr Anderson telephoned the appellant company informing Mr Mohammad that he was “desperate for work”. Mr Mohammad believed that Mr Anderson was having personal problems. At that time the appellant did not have any small projects available for Mr Anderson, just a few days work in Star City “where another one of our subcontractors had already commenced the project”. No report of injury was made by Mr Anderson at the time the injury was allegedly received. Mr Anderson performed work on the Star City project and was working with the appellant’s subcontractor Mr Yadollah Shaykholislami and his worker.

A statement made by Mr Yadollah Shaykholislami dated 24 November 2009 was before the Arbitrator. Mr Shaykholislami described himself as a subcontract painter. His business is known as Classic Finishes and he performed subcontract work for the appellant and other contractors. He has current workers compensation insurance. Whilst subcontracting to the appellant company, he had worked alongside another subcontractor known to him as Ebi whom he understood is also known as Kevin Anderson.
Mr Shaykholislami had been awarded the painting subcontract for Star City sports theatre in early June 2009. It was further stated that shortly after securing the job, Mr Saeed Mohammad contacted Mr Shaykholislami who asked if he had any work available for Ebi as he had just returned from overseas and was desperate for work. Mr Shaykholislami was aware that [Mr Anderson] was having “personal problems” and he wished to help him out because of his family. Mr Shaykholislami informed Mr Mohammad that he had “a few days work available if he wanted”. It was stated that Mr Anderson and Mr Shaykholislami had known each other for several years through the painting industry and had worked together as subcontractors on a number of jobs for various companies.
Mr Shaykholislami states that on 17 June 2009 he worked with one of his workers and Mr Anderson on the Star City job. They had been together all day and left the site together. No injuries or accidents occurred on this day or on any other day throughout the entire project. No complaint of pain or injury was made by Mr Anderson at that worksite.
The appellant tendered a large number of invoices which it had received from Mr Anderson trading as Atlantic Painting and, subsequently from May 2008, AM and PM Painting. Mr Anderson’s financial records, which had been produced earlier were tendered on behalf of the appellant. Those documents included some tax returns and documents issued by the Australian Taxation Office in respect of notices of assessment of tax liability. The content of those documents is addressed in the course of discussion below.
A copy of an email created by Mariana Mohammad addressed to the appellant’s counsel dated 20 May 2011 is in evidence. That email makes reference to the invoices noted above and includes a summary of monies paid to Mr Anderson by the appellant between 2005 and 2009.
Evidence tendered on behalf of Eco Choice included a further statement by Mr Mohammad which was dated 18 November 2010. Mr Mohammad is the sole director of Eco Choice which carries on business providing painting services to industrial and commercial clients. His wife Mariana is the office manager and the company has one full time painter and four causal staff. It is stated that Mr Anderson, also known as Tony Parker, was not an employee of either the appellant nor an employee of Eco Choice. A copy of Mr Mohammad’s statement made on 11 November 2009 was annexed to the statement. Mr Anderson, it was stated, did not perform any subcontract work “since June 2009, the last invoice he submitted to [Eco Choice] was in that month”. A document, being a spreadsheet, was attached to that statement which set out “monies paid to Mr Anderson by Eco Choice and [the appellant]”. Mr Mohammad asserted that Mr Anderson was never an employee, rather a subcontractor at all material times and further that he had no knowledge of the alleged injury. Mr Mohammad had had no contact with Mr Anderson since November 2009 until he received a telephone call from him in October 2010. Mr Anderson stated in that call that his claim in respect of the injury had been rejected, that he had lost everything; that he could not see his son who was overseas, and that Mr Mohammad was at fault. Mr Anderson stated during that telephone call that he had nothing to lose and that he was going to destroy Mr Mohammad’s life and his wife and children. A threat was made to Mr Mohammad’s brothers. He further stated that if he was “going down” he was going to take everyone with him. Mr Mohammad reported that matter to the police.
A further statement made by Mr Anderson dated 6 April 2010 was relied upon by Eco Choice. Mr Anderson states that he operated under a business name of AM and PM Painting, that he had his own ABN and that he regarded himself as an employee of the appellant. He stated that he would earn up to $1,400 per week for a six day week, but that work was not full time. He proceeded to describe the injury which he stated occurred during the course of work at Star City. Mr Mohammad, it was stated, “has connections to another organisation, Eco Choice and [Mr Mohammad] would direct who I should make my invoices out to, the majority of the time it was to [the appellant] but on occasions in particular during June 2009 it was to Eco Choice”. Mr Anderson stated that he always considered that he was “still working for [the appellant] as his ‘connection and dealings’ were only with Mr Mohammad, the boss of [the appellant]”. Mr Anderson was aware that there was one invoice from 3 June 2009 directed to Classic Finishes, which business “also did work for [the appellant].”
Mr Anderson further stated that when he returned from overseas “in about May 2009” he thought that he had asked Mr Mohammad for work. Mr Mohammad said that he did not have any at the time for which he could pay Mr Anderson and suggested that he contact Mr Shaykholislami and that Mr Mohammad would “sort it out” with Mr Shaykholislami at a later date. That is what Mr Anderson did and he “put in an invoice to Classic Finishes who paid me”. It was further stated “I still however always regarded that I was working for [the appellant] and this arrangement was only done at the request of Saeed Mohammad on the one occasion in conjunction with Yadi Shaykholislami”.
Mr Anderson denied that he had ever supplied materials and asserted that he could not have afforded to pay for paint and other materials even if he had wanted to. A letter signed by Mr Anderson in September 2009, indicating that he worked for the appellant as a painting subcontractor supplying labour and materials, was provided by him “under pressure from and at the direction of Saeed Mohammad as I was short on funds and after signing the letter I was given by Saeed an amount of $10,000 in cash which allegedly represented past superannuation payments that he indicated he had neglected to pay for me”.
Mr Anderson stated that whenever he bought paint he would buy it on the appellant’s account. Since the injury Mr Anderson had done some work for “a friend” doing light panting work for which he was paid $150 per day.
Eco Choice tendered in evidence a copy of certificate of registration of the business name Atlantic Painting, the proprietor of which business was named as Tony Parker, which was first registered in May 2004. A number of other documents were tendered including financial records produced by Mr Anderson which, where relevant, are addressed in the course of discussion below.
The transcript records that Mr Stockley, counsel for the appellant, who also appeared on behalf of Mr Shaykholislami, was granted leave to cross-examine Mr Anderson concerning the invoices issued by him, his tax returns and assessments and concerning the wage schedule filed on his behalf. Counsel for Eco Choice, Mr Morgan, was granted leave to cross-examine Mr Anderson concerning, as put by counsel, “the disparity that exists between the invoices submitted and what appears in bank statements” (T29-30, 29 August 2011).
Mr Anderson was questioned concerning the taxation assessments produced by him relating, on the face of the documents, to the financial years ending June 2006, 2007 and 2008. Particular attention was drawn to the assessment which appeared to relate to the year ending June 2007 and a copy of a tax return in respect of that year. Questions were also put concerning the invoices issued by Mr Anderson. The detail of this and subsequent questioning following the engagement of an interpreter is addressed below. It is important to note that during questioning Mr Anderson made it clear that he had kept copies of some of his invoices but had lost copies of others. It was also stated in evidence (at T52, 29 August 2011) that he had lost his invoice book.
Questioning continued concerning income in the 2007 financial year. Mr Anderson stated he did not know what his income for that year was. It was suggested by Counsel that it could have been “as little as $5,347” to which Mr Anderson said he did not know. It was then suggested that income that year could “have been as much as $197,000”. Mr Anderson responded “might be. Because it’s not my real income”.
When pressed by Counsel as to what Mr Anderson considered to be income, Mr Anderson stated:
“That’s not my real income. They put the large amount of money in my account. I do the cash. I give it to them back. That’s why they, they call it laundry money. Laundry, laundering money”.
Counsel proceeded to question Mr Anderson concerning the reliability of the invoices as demonstrating evidence of income. It was put to Mr Anderson that he had “made up the story about money laundering today to explain your tax return and invoices”. That proposition was denied. Counsel proceeded to question Mr Anderson concerning the workers compensation insurance currency certificates. During questioning concerning this and associated subjects, the cross-examination was suspended as noted at [15] above.
Cross-examination of Mr Anderson continued when the matter resumed before the Arbitrator on 26 October 2011. An interpreter was in attendance. Mr Stockley again questioned Mr Anderson concerning the taxation records relating to the financial year 2007. This questioning is addressed in discussion below. That cross-examination included questions which suggested that the relevant tax assessment had been altered. No explanation was given by Mr Anderson concerning the suggested alteration of that document.
Cross-examination of Mr Anderson by counsel for Mr Shaykholislami addressed evidence of payment to Mr Anderson’s business, Atlantic Painting, in 2007. In response to questioning Mr Anderson stated that he borrowed some money and that a gentleman put money into his account and that those entries had “nothing to do with this case”. Mr Anderson was pressed concerning payment of $3,500 by Multi Painting on 19 February 2007 to which Mr Anderson responded that whilst he was paid by Multi Painting he was in fact working for the appellant and that Multi Painting “is sub-contractor for [the appellant]”. Counsel then drew attention to further evidence concerning payment to Mr Anderson by Multi Painting. The questioning put by Mr Morgan concerned banking records which demonstrated that in July and August 2006 Mr Anderson had rendered invoices to both the appellant and Multi Painting in respect of substantial sums. Further questions concerning Mr Anderson’s financial records elicited responses from Mr Anderson concerning the receipt by him of loans, payment for an airline ticket and transfers of money from Iran. Mr Anderson, when questioned about deposits to his account in 2008, stated that the monies represented the proceeds of gambling activity.
Mr Anderson’s attention was drawn to his tax return in respect of the year ending June 2008. It was suggested that the content of the tax return did not reflect the deposits made in various accounts during that year. His response was as follows:
“That is right. I explained that all. I explained that, I explained that from in the previous hearing that these were money (inaudible) that they credited to my account and I have proof of all that”.
Cross-examination was then terminated.
At the hearing before the Arbitrator conducted on 14 December 2011, a statement by Mr Mohammad dated 28 October 2011 was tendered on behalf of the appellant. In that statement Mr Mohammad denied the allegations of “money laundering” which had been made by Mr Anderson in the course of his cross-examination.

SUBMISSIONS BEFORE THE ARBITRATOR

Mr Perry, counsel appearing on behalf of Mr Anderson, first addressed the question of injury and its consequences. It was put that the evidence established that the injury to Mr Anderson’s right shoulder occurred in the course of work performed by him at Star City. Reference was made to the medical evidence before the Arbitrator, in particular the medical certificates issued by Dr Hamid. It was put that, with the exception of short periods during which he had performed some light work, he has been totally incapacitated at least until 3 May 2011. In written submissions forwarded to the Commission under cover of letter dated 9 January 2012 from Mr Anderson’s solicitors it was suggested that the evidence supported an allegation of total incapacity up until 9 December 2011 and that Mr Anderson was partially incapacitated from that date and continuing. As to quantum, it was put that Mr Anderson was “not capable of earning in excess of $200 gross per week”. Those written submissions suggested that, given Mr Anderson’s reduced earning capacity, he would be entitled to an award in respect of the statutory maximum weekly compensation rate during periods of partial incapacity to date.
Counsel proceeded to address the question as to the relationship between Mr Anderson and the three respondents to his application. It was put that, on the evidence, it was open to the Arbitrator to find that Mr Anderson had been employed by Mr Shaykholislami at Star City when the subject injury was received. Notwithstanding that argument, it was Mr Anderson’s primary submission that at all relevant times he was employed by the appellant. It was put that upon Mr Anderson’s return from abroad “he went straight to the man who had given him work over a reliantly [sic] period beforehand, Saeed Mohammad. I am desperate for some work, and he was directed by Saeed Mohammad to Star City where he was told you can direct your invoice to Shaykholislami”. At that point there was an exchange between the Arbitrator and counsel concerning the invoices issued by Mr Anderson and the contents of a statement made by him. Counsel submitted that the evidence of Mr Anderson concerning his preparation of invoices as directed by Mr Mohammad should be accepted. An argument appears to have been advanced that the state of the invoices reflect the directions given by Mr Mohammad rather than demonstrating an agreement between Mr Anderson and the addressees of the invoices.
Counsel proceeded to address the further alternative argument that, at relevant times, Mr Anderson was a deemed worker of the appellant. It was put that there was a contract between Mr Anderson and the appellant and that the contract was in respect of work to be performed at Star City. Mr Anderson had not sublet the contract nor did he employ workers. Counsel further stated that his client “did not perform that work as part of a trade or business regularly carried on by himself at [sic] his own or in a, in a business name”. It was further argued that, as at June 2009, “there is just nothing to say that Mr Anderson was doing anything other than the bidding of Saeed Mohammad. He did not hang out his shingle. There is nothing produced [to the Commission] to say AM and PM Painting is listed in the Yellow Pages, published in local gazettes that he is conducting a business in any way, shape or form. There’s nothing to show that he is, otherwise than exclusively working for the party he has, from whom he has sought compensation” (T74, 14 December 2011). During exchanges with the Arbitrator counsel accepted that Mr Anderson had no real case against Eco Choice, however no step was taken to discontinue the proceedings against that respondent to the Application.
Counsel for the appellant and Mr Shaykholislami, Mr Stockley, submitted that the evidence supported the proposition that Mr Anderson had conducted a business for many years trading variously as Atlas Painting, Atlantic Painting and AM and PM Painting. The evidence established, it was submitted, that Mr Anderson was the proprietor of a relevant business name before the establishment of the relationship with the appellant in 2006. Reference was also made to the insurance certificates of currency which, it was argued, supported an inference that “the terms of the engagement [between the appellant and Mr Anderson] permitted and contemplated the possibility that [Mr Anderson] would engage others”.
Counsel made reference to the financial records including the invoices which “suggest significant amounts paid inconsistent, not only with the notion of him being a painter on wages, inconsistent with all his own financial documents to the extent that they’re available”. It was put that the taxation returns “disclose nothing”. That evidence, it was put, was “so unreliable as to the assistance in [the Arbitrator’s] determination given the other material that has been placed before [the Commission]”. It was also put that those documents were “within themselves inconsistent”. Attention was drawn during the course of argument to the document produced by Mr Anderson which purported to be a taxation assessment in respect of the 2007 financial year. Close examination of that document, it was argued, demonstrates that a deliberate attempt had been made by someone to deceive the reader of the document and that it, in fact, related to the 2005 year. The argument was advanced that the Commission “would not accept the assertions about [Mr Anderson’s] financial affairs, except to the extent that they might be otherwise corroborated by persuasive evidence”. The financial records were not “indicative [of Mr Anderson’s] true financial and business activities”.
Counsel proceeded to address the evidence generally and particular attention was paid to the quantum of payments made over the years to Mr Anderson including payments apparently made by parties other than the appellant. The thrust of the appellant’s argument was that the financial records demonstrate that Mr Anderson has for many years conducted business and that “nothing changed after he commenced his dealings with [the appellant] and Eco Choice Pty Limited”. In response to a question put by the Arbitrator, Mr Stockley confirmed that it was the appellant’s argument that the evidence supports a conclusion that Mr Anderson had received payments between 2005 and 2009 from the appellant in the sum of $435,000 (approximately) (at T98, 14 December 2011). Attention was drawn to evidence concerning the financial year 2005 where the evidence establishes total deposits of $116,965. An examination of the 2005 tax return reveals that taxable income for that year was “$25,000 or thereabouts”. A similar contrasting picture is demonstrated “for each of the successive years”. During exchanges between the Arbitrator and counsel it was accepted by Mr Stockley that the calculations relating to annual income did not address the financial year, but the calendar year.
As to the nature of the relationship between Mr Anderson and the appellant at any time from 2006, an argument was advanced that the Commission would “ have to take account of [Mr Anderson’s] previous conduct, the nature of the work he was performing, and his relationship with [the appellant]. And [ the Commission would] also have to take into account what Mr Mohammad says”. Counsel had earlier submitted that Mr Anderson, when pressed as to the significant income received by him in years earlier than 2009, was unable to explain such payments other than to suggest his involvement in some criminal conspiracy.
Counsel argued that the invoices in evidence indicate that Mr Anderson contracted with various entities from time to time including during the year 2009. It was put that, in the circumstances, the painting that he was performing on 17 June 2009 “was incidental to a business carried on in his business name”.
It was accepted by counsel that Mr Anderson, by reason of his shoulder injury, has an economic incapacity (T105, 14 December 2012). Counsel proceeded to address concerning the difficulty of assessing the quantum of any entitlement to weekly compensation.

A final submission was put that, should the Commission find that there was a contract to perform painting work at Star City on the relevant date in June 2009, the contract must on the evidence have been with Eco Choice.
Counsel for the second respondent, Mr Morgan, with the exclusion of the last mentioned, adopted those submissions put by Mr Stockley. It was put that the state of the evidence was such that Mr Anderson’s evidence should not be accepted “at any level”. A primary submission was put that if it be found that Mr Anderson was providing services on the day of injury to Eco Choice it follows that Mr Anderson was conducting a trade or business in that he was “working for different employers”. An argument appears to have been advanced that a determination as to whether Mr Anderson at relevant times conducted a business should be determined having regard to all the evidence concerning his financial dealings including in the past, back to 2006 and at times post dating the alleged injury, where there is evidence of payment to Mr Anderson by South Coast Painting Service.
Mr Perry, in reply, addressed the question of incapacity, its extent and entitlement to weekly compensation. The Arbitrator (at T126, 14 December 2011) granted the parties leave to present written submissions concerning quantum of compensation following adjournment of the proceedings.
Counsel responded to Mr Stockley’s argument concerning inferences that may be drawn from the existence of insurance certificates of currency by emphasising the evidence of Mr Anderson that he was required by Mr Mohammad to take out such cover. The nature of the relationship between Mr Anderson and the appellant required a number of matters to be taken into account including that those engaged by the appellant had to have an Australian Business Number, they were required to submit invoices and they were required to have a workers compensation policy (T130-131, 14 December 2011).

THE ARBITRATOR’S DECISION

The Arbitrator identified the issues in dispute at [4] of Reasons:
“The following issues remain in dispute:
(a) So far as the Second Respondent is concerned:
(i)whether Mr Anderson suffered an ‘injury’ to his right shoulder, and
(ii)if so, what incapacity for work, if any, did it cause.
(b) So far as all three Respondents are concerned, whether Mr Anderson was an employee or deemed employee of any of them when he injured his shoulder.”
The evidence was summarised by the Arbitrator between [11] and [106] of Reasons, in the course of which a number of findings were made including:
(a)     that Mr Anderson had worked as a subcontractor for Rohy’s Painting Pty Limited until December 2006, and held workers compensation insurance up to February 2007 (at [16] of Reasons);
(b)     that it was likely that Mr Anderson performed painting work for Multipainting from April 2006 to February 2007 (at [17] of Reasons);
(c)     that, concerning the altered tax assessment, there was no convincing evidence as to who, when or why the notice was altered. The Arbitrator was not satisfied that it was altered by Mr Anderson, at his request, or even with his knowledge. The existence of that evidence did not cause the Arbitrator to doubt the truth of Mr Anderson’s evidence (at [18] of Reasons);
(d)     that the appellant provided Mr Anderson with paint for jobs done at his request (at [22] of Reasons);
(e)     that Mr Anderson performed work at the request of the appellant at various locations between 22 July 2007 and 31 July 2009 as evidenced by invoices (at [24] of Reasons);
(f)      that Mr Anderson made his own arrangements with regard to the payment of GST and income tax (at [25] of Reasons);
(g)     that the Arbitrator was not satisfied that Mr Anderson employed “anyone” between 2007 and 2009 (at [26] of Reasons);
(h)     that Mr Anderson continued to work for the appellant until 30 July 2009 (at [40] of Reasons);
(i)      the admissions made by Mr Anderson in the document dated 24 September 2009 were likely signed at the request of Mr Mohammad in return for a cash sum of $10,000, or the promise of it. The probative value of the admissions was reduced in such circumstances (at [48] of Reasons);
(j)      that Mr Anderson had not experienced significant problems with his right shoulder until 17 June 2009 (at [62] of Reasons);
(k)     that Mr Anderson suffered injury to his right shoulder as a result of a series of traumata or micro-traumata due to the nature and conditions of his work while performing overhead painting work for the appellant. The most severe of these traumata occurred on 17 June 2009 while working at the Star City Casino at the request of the appellant at which time Mr Anderson suffered a partial tear of the supraspinatus tendon (at [64] of Reasons);
(l)      the evidence of Mr Anderson concerning payments to him by a friend in December 2009 and January 2010 was accepted;
(m)   that Mr Mohammad had requested Mr Anderson to invoice Eco Choice for work at Star City on 17 and 18 June 2009 (at [78] of Reasons);
(n)     that the direction of Mr Mohammad to invoice Eco Choice was made in his capacity as a director of the appellant (at [79] of Reasons);
(o)     that Mr Anderson worked at Wollstonecraft on 3 June 2009 at the direction of Mr Mohammad and that Mr Mohammad directed Mr Anderson to invoice Mr Shaykholislami (at [79] of Reasons);
(p)     that the first of the invoices issued to the appellant is dated 22 February 2007 and that Mr Anderson worked for the appellant between February 2007 and July 2009 (at [81] of Reasons);
(q)     that the Star City project had been awarded to the appellant, and that the appellant had subcontracted the work to Mr Shaykholislami;
(r)      that the work performed by Mr Anderson at North Sydney in June and July 2009 was work performed for and at the request of the appellant (at [92] of Reasons);
(s)     that Mr Anderson was promised $10,000 in return for signing the statement dated 24 September 2009 and had “not received it – or at any rate, had not received it in full – by 21 October 2009” (at [98] of Reasons);
(t)      that Mr Anderson did not buy paint on any account other than the appellant’s (at [101] of Reasons), and
(u)     that from March 2007 to July 2009 Mr Anderson worked exclusively for the appellant, and was not regularly carrying on a trade or business in his own name or business name (at [106] of Reasons).
The Arbitrator proceeded to consider Mr Anderson’s allegation that he was a worker in terms of the 1987 Act. He found, at [117] of Reasons, that he was “not satisfied that Mr Anderson was employed by [the appellant]”.
The allegation that Mr Anderson was a deemed worker (Sch 1.2 to the 1998 Act) was considered by the Arbitrator. It was found that the work for which Mr Anderson invoiced Eco Choice and Mr Shaykholislami was work which Mr Anderson had been requested and directed to do by the appellant and that Mr Anderson performed that work in satisfaction of his contract from time to time with the appellant. The Arbitrator further found that he was not satisfied that Mr Anderson performed any work at the request or direction of Eco Choice or Mr Shaykholislami (at [121] of Reasons). A finding was made that “Schedule 1.2 does not deem [Mr Anderson] to have been an employee of [Eco Choice] or [Mr Shaykholislami]” (at [121] of Reasons).
A finding was made concerning Mr Anderson’s allegation that he was a “deemed worker” of the appellant (at [124] of Reasons):
“Having regard to all the evidence, I am satisfied that Mr Anderson was working exclusively as a contractor for RMS from March 2007 to July 2009. He was not regularly carrying on a trade or business in his own or any other name. In those circumstances, Schedule 1.2 deems him to have been an employee of RMS at the time when he suffered the partial tear of his right supraspinatus tendon on or about 17 June 2009, and during the period May to June 2009, when he suffered right shoulder injury due to the nature and conditions of his work.”
The Arbitrator concluded that as a result of physical and psychological injury Mr Anderson had been totally incapacitated for work since August 2009 to date. Work performed since that date (1 August 2009) had been done as “a matter of economic necessity” and that such performance of work did not, the Arbitrator determined, demonstrate any “ongoing capacity for work”. An award was entered as noted at [7] above.

SUBMISSIONS, DISCUSSION AND FINDINGS

This appeal is governed by the provisions of s 352 of the 1998 Act. The nature and scope of such an appeal is as provided by s 352(5):
“An appeal under this section is limited to a determination of whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”
The powers of the Commission upon conduct of such an appeal are defined by the provisions of s 352(7):
“On appeal, the decision may be confirmed or may be revoked and a new decision made in its place.
Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.”
The first ground of appeal suggests error on the part of the Arbitrator concerning his finding that Mr Anderson was at relevant times a deemed worker. That finding, at [124] of his Reasons (set out at [65] above), was made following the Arbitrator’s consideration of the evidence concerning the contractual relationship between Mr Anderson and the appellant. The Arbitrator rejected Mr Anderson’s allegation that the relationship was one of master and servant. A finding was made that the evidence did not support a conclusion that Mr Anderson was at relevant times a worker within the meaning of the 1987 Act (at [117] of Reasons).
Having so concluded, the Arbitrator noted (at [120] of Reasons) that it was “common ground between [Mr Anderson] and [the appellant] that [Mr Anderson] was a contractor for [sic] [the appellant]”. The Arbitrator found that there was no contractual relationship between Mr Anderson and either Eco Choice or Mr Shaykholislami (at [121] of Reasons).
The Arbitrator’s conclusion that Mr Anderson was, in the circumstances, to be taken to be a worker was founded upon the provisions of cl 2 of Sch 1 to the 1998 Act which provides relevantly:
“(1) Where a contract:
(a) to perform any work exceeding $10 in value (not being work incidental to a trade or business regularly carried on by the contractor in the contractor’s own name, or under a business or firm name), or
(b) (Repealed)
is made with the contractor, who neither sublets the contract nor employs any worker, the contractor is, for the purposes of this Act, taken to be a worker employed by the person who made the contract with the contractor.”
The manner of construction and application of the clause was addressed by Bainton A-JA (Kirby ACJ and Rolfe A-JA agreeing) in Scerri v Cahill (1995) 14 NSWCCR 389 at 399 (Scerri) where his Honour stated:
“On its proper construction, clause 2 of Schedule 1 requires an applicant who relies on it to establish each of the ingredients, both positive and negative, which identify the relevant ‘work’.
What he must establish is:
1.       that he was party to a contract with the respondent to perform work;
2.       that work exceeds $10 in value;
3.       that the work is not work incidental to a trade or business regularly carried on by the applicant in his own name or under a business or firm name; and
4.       that the applicant has neither sublet the contract nor employed workers in the performance of it.”
There was no issue between the parties that the work performed by Mr Anderson exceeded $10 in value or that Mr Anderson had neither sublet the contract as found by the Arbitrator nor employed workers in the performance of it. The sole issue concerned the question as to whether the work performed was not work incidental to a trade or business regularly carried on by Mr Anderson in his own name or under a business or firm name. As stated by Bainton A-JA in Scerri, the onus of proof concerning that negative fact is upon the putative worker.
It is accepted by Mr Anderson, as he must, that such onus is upon him (TA16.31). In written submissions put in opposition to this appeal it is argued that no error on the Arbitrator’s part has been made out. The Arbitrator was required to determine whether Mr Anderson was a “deemed” worker at the time of injury as found. The findings made at [124] of Reasons were, it was put, founded upon the evidence of Mr Anderson that during the period leading up to June 2009, all of Mr Anderson’s work was at the direction of Mr Saeed Mohammad, the principal of the appellant. It seems also to be argued that the evidence, being the content of the invoices, was properly accepted by the Arbitrator in support of Mr Anderson’s evidence “that [Mr Anderson] performed work at the request of [the appellant] at various locations during that period (at [13] and [14] of submissions). It is further argued that the evidence did not “establish … that [Mr Anderson] was working other than at the direction of the appellant” (at [15] of submissions). The Arbitrator, it is argued, “supported his findings with well disclosed reasoning” and it is put that no error is made out (at [16] of submissions).
The submissions summarised immediately above did not, in my view, address all the issues raised on this appeal. That circumstance was but one reason for directing that an oral hearing be conducted. The questions of whether Mr Anderson worked at the direction of Mr Mohammad or that work was performed at the request of the appellant, or that he was not proven to have worked other than at the direction of the appellant, whilst relevant, do not alone determine the question in issue being whether the work performed when injured was not incidental to a trade or business regularly carried on in Mr Anderson’s name or under a business or firm name.
The thrust of the appellant’s argument, as advanced before the Arbitrator, in written submissions on appeal and at the hearing of the appeal, was that the evidence, such as it was, concerning Mr Anderson’s financial and business activities was unreliable and inconsistent. As such it did not constitute persuasive evidence which would corroborate Mr Anderson’s assertion that the work was not incidental to a trade or business regularly carried on by him.
At the hearing of the appeal, counsel for Mr Anderson argued that it was open to the Arbitrator, on the evidence before him, to conclude as he did at [106] of Reasons (summarised at [62(u)] above). The evidence in support of those conclusions was said to be Mr Anderson’s evidence. That evidence was summarised by counsel (at AT11) as follows - “for two years I worked for nobody but [Mr Mohammad]. I only worked for him. I provided invoices to him at his direction”. It was argued that the content of the invoices was not evidence “that would displace [Mr Anderson’s] evidence that [he] didn’t work for anybody except [Mr Mohammad]” (TA11.45).
Counsel further argued that, given the Arbitrator’s favourable finding concerning the credit of Mr Anderson and his acceptance of his evidence concerning his dealings with the appellant, to succeed on the appeal it would need to be established by the appellant that the Arbitrator “fell into error in accepting [Mr Anderson] as a truthful witness” (at TA 17.15).
I have reached the conclusion that this first ground is made out. The Arbitrator’s finding that “Schedule 1.2 deems [Mr Anderson] to have been an employee of [the appellant] at the time he suffered [the injury] on or about 17 June 2009” is, in my view, successfully challenged by the appellant and must be revoked. In so concluding I have taken into account the following matters:
(a)     the Arbitrator’s finding concerning Mr Anderson’s credit as a witness;
(b)     the state of the evidence relied upon by Mr Anderson;
(c)     the nature of the onus upon Mr Anderson to prove the negative fact being that the work was not incidental to a trade or business, and
(d) those authorities which address the proper construction and application of Sch 1.2.

The Arbitrator’s finding as to the credit of Mr Anderson as a witness

Following a summary of Mr Anderson’s evidence in chief and when cross-examined, the Arbitrator made the following findings as to his credit as a witness (at [72] and [73] of Reasons):
“I had the opportunity to observe Mr Anderson under cross-examination - at first without an interpreter at the request of his counsel, and later, after he had indicated that he was struggling with English, with an interpreter in the Farsi language. He gave his evidence in a straightforward manner, making due allowance for his language difficulties without an interpreter. His version of events was internally consistent, and consistent with the documentary evidence, so far as it went. Except as mentioned below, it was largely consistent with the evidence of Mr Shaykholislami.
I make findings in accordance with Mr Anderson’s evidence, except as regards his relationship with Multipainting, which I accept was probably that of a contractor, and his earnings, which are dealt with below in the context of incapacity. To the extent that
Mr Anderson’s evidence differed from the evidence of Mr Shaykholislami, Mr Mohammad and Mr Mahabat, I indicate below my findings in the context of each of their evidence.”
Mr Anderson’s evidence was that he regarded himself as an employee of the appellant; that he did not carry on a trade or a business, and that he worked for Mr Mohammad or at his direction (as noted at [21] above). Mr Anderson’s evidence on this matter may be characterised as bare assertions which are contradicted by other evidence including that of Mr Mohammad. In such circumstances a determination of matters in dispute required careful assessment of the evidence as a whole.
It is clear that the Arbitrator’s preference for the evidence of Mr Anderson was founded, in part, upon an assessment of his credit as a witness. In such circumstances I have had regard to relevant authority concerning the proper basis for setting aside such findings. I acknowledge the correctness of Mr Perry’s submission that the appeal process prescribed by s 352 is expressly not a review nor a rehearing. There is a requirement to establish error before the making of an order setting aside findings of the Arbitrator.
The manner in which the Commission is to approach a challenge to such findings may be guided by that which was stated by the High Court in Devries v Australian National Railways Commission [1993] HCA 78; 177 CLR 472 (Devries) and by subsequent authority. The circumstances of Devries concerned a review by the Full Court of a finding as to credit made by a trial judge. It was stated by the High Court that such a finding could properly be overturned “only if it was vitiated by some error of principle or mistake or misapprehension of fact or if the effect of the overall evidence was such that it was not reasonably open to the trial judge to accept [the plaintiff] as a witness of truth” (per Deane J and Dawson J at 483). The statements made in the joint judgment of Brennan, Gaudron and McHugh JJ are of further assistance to the Commission in dealing with the tasks raised on this appeal where their Honours stated (at 479, omitting footnotes):
“More than once in recent years, this Court has pointed out that a finding of fact by a trial judge, based on the credibility of a witness, is not to be set aside because an appellate court thinks that the probabilities of the case are against – even strongly against – that finding of fact. If the trial judge’s finding depends to any substantial degree on the credibility of the witness, the finding must stand unless it can be shown that the trial judge ‘has failed to use or has palpably misused his (or her) advantage’ or has acted on evidence which was ‘inconsistent with facts incontrovertibly established by the evidence’ or which was ‘glaringly improbable’.”

Further guidance is afforded by a consideration of subsequent authority including those matters stated by the High Court in Fox v Percy [2003] HCA 22; 214 CLR 118 per Gleeson CJ, Gummow and Kirby JJ (at [30] and [31]):
“It is true, as McHugh J has pointed out, that for a very long time judges in appellate courts have given as a reason for appellate deference to the decision of a trial judge, the assessment of the appearance of witnesses as they give their testimony that is possible at trial and normally impossible in an appellate court. However, it is equally true that, for almost as long, other judges have cautioned against the dangers of too readily drawing conclusions about truthfulness and reliability solely or mainly from the appearance of witnesses. Thus, in 1924 Atkin LJ observed in Société d'Avances Commerciales (Société Anonyme Egyptienne) v Merchants' Marine Insurance Co (The "Palitana"):
‘... I think that an ounce of intrinsic merit or demerit in the evidence, that is to say, the value of the comparison of evidence with known facts, is worth pounds of demeanour.’
Further, in recent years, judges have become more aware of scientific research that has cast doubt on the ability of judges (or anyone else) to tell truth from falsehood accurately on the basis of such appearances. Considerations such as these have encouraged judges, both at trial and on appeal, to limit their reliance on the appearances of witnesses and to reason to their conclusions, as far as possible, on the basis of contemporary materials, objectively established facts and the apparent logic of events. This does not eliminate the established principles about witness credibility; but it tends to reduce the occasions where those principles are seen as critical.”
Taking into account those matters stated by the superior courts which I have attempted to summarise above I conclude, for the reasons stated below, that the evidence as a whole fails to corroborate the bare assertions made by Mr Anderson concerning his relationship with Mr Mohammad and the appellant.

The state of the evidence relied upon by Mr Anderson

Having regard to the dispute as to the nature of the contractual relationship between Mr Anderson and the appellant I consider, for the following reasons, that the evidence tendered in Mr Anderson’s case may be described as scant and, in many respects, unsatisfactory.
There are three workers compensation claim forms relied upon by Mr Anderson. Each is addressed to an insurer. The first, dated 21 September 2010 names Eco Choice as the employer. The second, also dated 21 September 2010, nominates Classic Finishes (Mr Shaykholislami’s business) as the employer. The latest in time, dated 23 October 2010, nominates the appellant as employer. As earlier noted (at [5] above) it is clear that Mr Anderson was, at the time of the claim and when commencing proceedings, uncertain as to the identity of his alleged employer. It may be inferred that Mr Anderson then considered that relevant contractual relations may have existed between him and one or more of the nominated employers. The evidence, being the claim forms, is thus inconclusive and does not assist in the resolution of the matters in dispute.
Mr Anderson, whose evidence was that he lost his invoice book (TA 52-53), relied upon copies of invoices issued in the name of his registered business, AM and PM Painting. Those copies formed part of a wage schedule which was an attachment to the Application. The detail of those invoices is demonstrated in the table below:

Date

Invoice Number

Addressee

Amount

Detail

20.02.07

1135

Appellant

$7,700 (incl GST)

Job North Ryde

-

1145

Appellant

$1,650 (incl GST)

Paid 22.07.08; Job Thornleigh Woolworths

30.07.08

114

Appellant

$4,680

Job Sussex St

-

1145

Appellant

$2,200 (incl GST)

Paid 11.09.08; Job Parramatta swimming pools

31.10.08

146

Appellant

$11,000 (incl GST)

Job Sussex St; paid in two instalments

28.11.08

1148

Appellant

$3,660

Job Rock Pool

06.01.09

1150

Appellant

$2,000

Job Rock Pool

20.04.09

-

Eco Choice

$3,300 (incl GST)

Job Marayong Woolworths

20.05.09

103

Eco Choice

$2,200 (incl GST)

Job North Ryde

30.05.09

-

Appellant

$4,800

Star City

30.06.09

1003

Classic Finishes

$3,300 (incl GST)

Job Wollstonecraft

17.06.09

-

Eco Choice

$1,100 (incl GST)

Job Star City

18.06.09

-

Eco Choice

$1,500

Job Star City

30.06.09

109

Appellant

$6,600

Date 31.07.09 crossed out; paid in four instalments; Job North Sydney

The table appearing above demonstrates a number of features which, having not been explained in evidence, are in my view unsatisfactory including:
(a)     some invoices are undated;
(b)     some invoices do not have an invoice number;
(c)     the invoice numbers, having regard to the chronology, are not serial;
(d)     some invoices are not expressed as including GST;
(e)     some invoices bear numbers of four digits, others of three digits;
(f)      all invoices concerning the relevant job, Star City, are unnumbered;
(g)     in one case the same numbered invoice (1145) relates to different jobs and different money sums, and
(h)     whilst the printed form of the invoices is identical in each case, the invoice number as appears on the copies is either printed or handwritten.
The unsatisfactory features which I have noted above provide significant weight, in my view, to the appellant’s submission that that evidence is unreliable and did not afford a sound basis for determining the true nature of Mr Anderson’s financial affairs and dealings.
At page 70 of the Application a document described as a summary of tax invoices rendered by Mr Anderson to the appellant “from July 2008 to June 2009” appears. That document, the author of which is unknown, is flawed in that the invoice number 146 ($11,000) is noted as being dated 31 August 2008, whereas the copy in evidence is dated 31 October 2008. More significantly the summary omits any reference to invoice dated 30 May 2009 (unnumbered) in the sum of $4,800, the only invoice in respect of the Star City job addressed to the appellant. I also note that the stated total of $31,790 does not correspond to Mr Anderson’s statement dated 18 November 2010 that relevant earnings for that period were a total of $43,190. These inconsistencies and errors rendered the document unreliable and of little assistance in resolving the issues which were before the Arbitrator.
The statements made by Mr Anderson upon which he relied have been summarised between [16] and [21] above. As noted earlier Mr Anderson, in the first of his statements, resiled from his earlier assertions made in the claim forms that he was earning $1,400 per week before injury (noted at [20] above). His earnings, he stated, were in fact $43,190 for the financial year ending June 2009. This assertion may be contrasted, not only with what appears in the claim forms, but also with his earlier assertions made in a statement relied upon by the appellant (noted at [22] above) that he was paid $250 per day for his work as a painter.
The inconsistency concerning quantum of earnings, a matter of fundamental significance when an attempt to determine the nature of the contractual relationship between the parties is made, renders Mr Anderson’s statements unreliable concerning the subject of remuneration.
Mr Anderson had tendered, as an attachment to his statement made 18 November 2010, a number of invoices issued by his registered businesses. Those invoices include those noted in the table above as well as two additional invoices. The earlier of those invoices, number 1135 dated 20 February 2007 issued in the name Atlantic Painting, was addressed to the appellant in the sum of $7,700 (inclusive of GST) in respect of a job at North Ryde. That invoice, considered with others tendered by the appellant, suggest a contractual arrangement subsisting between Mr Anderson and the appellant many months before March 2007, being the time found by the Arbitrator at which Mr Anderson commenced “working exclusively, as a contractor for [the appellant]” (at [124 of Reasons).
The second additional invoice bears no invoice number, is addressed to Eco Choice and is dated 31 July 2009. It relates to work at Berry St, North Sydney. That date is the date which had been deleted from invoice number 109 (North Sydney job) noted in the table. The amount stated is $5,500, a sum which differs from that appearing in invoice 109. The state of the evidence concerning that transaction is unexplained, is confusing and may be described as unreliable. That the evidence is confusing is borne out by the Arbitrator’s reference to it at [39] of Reasons where it was stated that the invoice related to work performed on “29 June, 17, 27 and 30 July 2009”. It is clear that, notwithstanding the date appearing on the invoice, those dates mentioned by the Arbitrator relate to dates of four payments totalling $6,600, and not to days of work.
Mr Anderson relied upon six delivery dockets noted at [23] above. That evidence was tendered in support of Mr Anderson’s allegation that material was supplied by the appellant. The Arbitrator, when considering this evidence, erroneously characterised the dockets as “invoices” (at [22] of Reasons). That matter was raised in submissions on this appeal. Nothing in those documents suggests that the account held by the appellant with Dulux was to be debited in respect of the paint delivered as evidenced by the dockets. Indeed the “unit value” or price in each appears as “nil”. That evidence is consistent with the appellant’s evidence that it permitted Mr Anderson to use its account with the supplier to enable him to have the benefit of a discount. The weight of that evidence is, in my view, slight and certainly not as persuasive as the Arbitrator appears to have treated it.

The nature of the onus upon Mr Anderson concerning proof that the work was not incidental to a trade or business

The Commission, in deciding facts according to the civil standard of proof, may be guided in its task by the decision in Ho v Powell [2001] NSWCA 168; 51 NSWLR 572 (Ho) where it was stated by Hodgson JA (with whim Beazley JA agreed) at [14] and [15]:
“There is a long-standing controversy whether the civil standard of proof requires a numerical probability in excess of 50 per cent (see Davies v Taylor [1974] AC 207 at 219), or belief amounting to reasonable satisfaction (see Briginshaw v Briginshaw (1938) 60 CLR 638 at 361-362). My own opinion is that the resolution of the controversy involves recognition that, in deciding facts according to the civil standard of proof, the court is dealing with two questions: not just what are the probabilities on the limited material which the court has, but also whether that limited material is an appropriate basis on which to reach a reasonable decision. I discussed this in some detail in an article published at (1995) 69 ALJ 731 ( D H Hodgson, “The Scales of Justice: Probability and Proof in Legal Fact-finding”).
In considering the second question, it is important to have regard to the ability of parties, particularly parties bearing the onus of proof, to lead evidence on a particular matter, and the extent to which they have in fact done so: cf. 69 ALJ at 732-733, 736, 740. As stated by Lord Mansfield in Blatch v Archer (1774) 1 Cowp 63 at 65; 98 ER 969 at 970): “… [A]ll evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted”. See also Azzopardi v The Queen (2000) 75 ALJR 931 at 935 [10]; 179 ALR 349 at 353 [10].”
I have earlier expressed my view that the evidence adduced by Mr Anderson on this issue in dispute is scant and have stated my view that, in many respects, that evidence is unsatisfactory. That circumstance is, in my view, compounded by the apparent failure of Mr Anderson to adduce relevant evidence which may reasonably be taken to have been in his power to produce. Such a suggested deficiency in the evidence was raised with counsel during conduct of the appeal. Mr Perry’s response was to argue that the Arbitrator had taken into account all the evidence, including responses in cross-examination, and had properly concluded in Mr Anderson’s favour. It was put that it was necessary for the appellant to satisfy the Commission on appeal that the Arbitrator had “overlooked some bit of evidence or didn’t advert to some bit of evidence that led - that displaced the conclusion” (TA11.51). That submission does not address the deficiency of evidence suggested by the appellant in argument.
I am of the view that there are at least two significant evidentiary items which Mr Anderson may reasonably be taken to have been in a position to produce concerning his financial affairs, which were not tendered in evidence and in respect of which no explanation for their absence was advanced. The first is Mr Anderson’s taxation return in respect of the relevant year, that ending 30 June 2009. The second item was Mr Anderson’s record relating to payment of GST, a sum often, but it seems not always, charged in respect of work performed by him. The relevant Business Activity Statements for relevant periods were not in evidence before the Commission.
Both the tax return and the GST records would, it may reasonably be expected, demonstrate at the very least the turnover of AM and PM Painting during 2009. The absence of those records prevents a comparison with the financial records of payment by the appellant and others which may be made having regard to the evidence tendered on behalf of the appellant and Eco Choice.
It is important to note that during exchanges with counsel at the appeal hearing I expressed the view that it may have been reasonably expected that Mr Anderson’s invoice book might have been produced before the Arbitrator. Subsequent scrutiny of the transcript of proceedings before the Arbitrator reveals that Mr Anderson had stated in evidence that he had lost his invoice book. That fact was revealed in the course of cross-examination by Mr Stockley (TA52 and 53). In the circumstances I have not taken into account on this appeal the fact that such material was not adduced.
A very large volume of material was tendered by the appellant and Eco Choice. That material included many copies of invoices rendered by Mr Anderson to the appellant and some to Eco Choice dating from March 2006 to 31 July 2009. Also tendered by the putative employers were taxation records and banking records which, it seems, had been produced by Mr Anderson.
The invoices tendered by the appellant demonstrated that from time to time substantial sums were paid to Mr Anderson by the appellant. By way of example there were eight payments made over the period earlier mentioned which exceeded $20,000. Mr Anderson did not dispute receipt of those payments when cross-examined, but asserted that he was a party to “money laundering”. The difficulty with that evidence is that the banking records produced by Mr Anderson reveal only one deposit, on 25 July 2006 (Commonwealth Bank, Atlantic Painting account) of such an amount. It was thus open to inference that not all Mr Anderson’s banking records had been produced. There was no subsequent withdrawal which would imply “money laundering”. Mr Anderson may reasonably be taken to have in his power an ability to produce such records. Their absence, without explanation should, in my view, have led the Arbitrator to accept the denial of Mr Mohammad that such improper activity had occurred.
The appellant tendered Mr Anderson’s taxation records, which included copies of assessments in respect of years ending June 2006, June 2008 and the contentious 2005/2007 assessment (see[31] above). Also tendered by the appellant were Mr Anderson’s tax returns for the years ending 30 June 2007 and 2008. Examination of those documents demonstrates that there is no correlation between the amounts said to have been received by Mr Anderson in those years and the very substantial payments made to him as demonstrated by the evidence generally, in particular the invoices and records of payment tendered on behalf of the appellant. Mr Anderson was cross-examined concerning these apparent discrepancies by Mr Stockley at the hearing before the Arbitrator on 26 October 2011. No explanation was advanced by Mr Anderson other than to assert that he relied upon his tax agent (T15, 21 October 2011). This material represents, in my opinion, further evidence demonstrating the unreliability of Mr Anderson’s case as presented concerning his financial affairs and dealings.

Construction and application of cl 2 of Sch 1 to the 1998 Act

I have earlier made reference to the decision in Scerri which states the need for a claimant to establish that the work is not work incidental to a trade or business regularly carried on in the contractor’s own name or under a business or firm name.
In Humberstone v Northern Timber Mills [1949] HCA 49; 79 CLR 389 Dixon J characterised the words appearing in brackets in similar Victorian legislation as making provision for an exception or exclusion. His Honour stated (at 401 and 402):
“I think that the purpose of the exception or exclusion expressed by the words in question was to confine the benefit of the conclusive presumption which it establishes to persons who do not conduct an independent trade or business, who are not holding themselves out to the public under their own or a firm or business name as carrying on such a trade or business and who do not in the course of that trade or business, as an incident of its exercise, undertake the work by entering into the contract. The provision will thus cover men who work for the principal but have no independent business or trade and men who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business. The word ‘trade’ is capable of including any handicraft and in that sense it may seem to lack the element of systematic practice or holding out which the idea of openly conducting a distinct or independent trade or business and seeking custom implies. But a consideration of the policy of the provision as well as of its text appears to me to show that the distinction it seeks to draw is between on the one hand an independent contractor whose relation with the principal is special or particular either because it is outside the course of the general business of the contractor or the general practice of his trade or because he has no such general business or is not a general practitioner of his trade, and on the other hand an independent contractor who performs work successively or perhaps concurrently for his customers or others in the course of a definite trade or business carried on systematically or who holds himself out as ready to do so.”
It may be seen that his Honour was of the opinion that what needed to be established was that the relationship between the independent contractor and the principal was “special or particular” and that such was established if it be proven that the independent contractor “has no such general business or is not a general practitioner of his trade”. The scant nature of the evidence tendered on behalf of Mr Anderson, its inconsistency and unreliability, together with the absence of evidence that may reasonably be expected to have been adduced, leads me to conclude that the Arbitrator has erred in accepting the bare assertions made by Mr Anderson that such special or particular relationship existed between him and the appellant.
Whilst my conclusions are founded upon matters above stated, I am fortified in those views given other aspects of the evidence in its totality including that the invoices relied upon by Mr Anderson demonstrate that none was rendered between 6 January 2009 and 20 April 2009, a period exceeding three months. The invoice issued on 20 April 2009 was directed to Eco Choice, following which there is no further invoice rendered until 20 May 2009 (again to Eco Choice). Consistent with Mr Anderson’s evidence, as accepted by the Arbitrator, it seems that Mr Anderson was overseas following performance of the work in April and until performance of the work evidenced by the invoice issued 20 May 2009.

It was common ground that, upon his return from overseas, Mr Anderson was desperate for work and approached Mr Mohammad. Mr Mohammad had no work but took steps to assist Mr Anderson in his plight. It is thus clear that at that point in time Mr Anderson had had no dealings with Mr Mohammad since January 2009 other than the Eco Choice job in April of that year.
In May 2009 Mr Anderson was plainly holding himself out to Mr Mohammad, the principal of two companies with whom Mr Anderson had previously dealt, as being available to work on contract. Within a matter of weeks work was performed and each of those companies received invoices in respect of work done. There is no evidence in support of the Arbitrator’s conclusion found at [79] of Reasons that Mr Mohammad requested that invoices be sent to Eco Choice “in his capacity as a director of [the appellant]”.
The unnumbered invoice issued on 30 May 2009 to the appellant was in respect of work at Star City. The next invoice, issued on 3 June 2009, was addressed to Classic Finishes in respect of work at Wollstonecraft. Those invoices confirm the evidence of Mr Mohammad and Mr Shaykholislami that efforts were made to provide work to Mr Anderson upon his return to Australia. It was Mr Shaykholislami’s evidence that he took on the Star City job in “early June” 2009. The invoices forwarded to Classic Finishes and Eco Choice by Mr Anderson in June 2009 are consistent with Mr Anderson’s evidence that Mr Mohammad “said he did not have any [work] at the time that he could not afford to pay me and suggested I contact [Mr Shaykholislami], work with him and invoice him and, that [Mr Mohammad] would sort it out with [Mr Shaykholislami] at a later date”.
The evidence establishes that work (at Wollstonecraft) was made available, that it was performed by Mr Anderson and that Classic Finishes was charged for the work. On any view of the evidence it is clear that contractual relations between Mr Anderson and Classic Finishes were established. Whatever the expression “sorted out” may be construed to mean, it remains the fact that work for Mr Shaykholislami was sought and provided and payment followed performance of that work.
As indicated at [79] above I am of the opinion that the Arbitrator has erred and that his finding concerning the issue as to whether the work performed was not work incidental to a trade or business regularly carried on by Mr Anderson, which finding is implicit in his finding that Mr Anderson “was not regularly carrying on a trade or business in his own or any other name” (Reasons at [124]), and subsequent orders, must be revoked. My conclusion is founded upon acceptance of the appellant’s argument that the evidence concerning this issue is inconsistent and deficient and is thus unreliable. The Arbitrator’s finding was not reasonably open to be made on that evidence nor, in my view, was the Arbitrator’s finding as to the credit of Mr Anderson.
It was put on behalf of Mr Anderson that, if error be established on this appeal, the matter should be remitted to an Arbitrator for hearing afresh. I reject that submission given my view that it is appropriate, and in accordance with legislative intent, that a new decision is made on this appeal in place of that of the Arbitrator. Appropriate orders appear below.
In the circumstances it is unnecessary that the balance of the appellant’s grounds of appeal be addressed. However, should I be in error in concluding as I have concerning ground one, I consider it appropriate to deal briefly with those remaining grounds.
As to ground two, I have earlier stated that the Arbitrator has erred in his conclusions as to the credit of Mr Anderson. My conclusion was reached having regard, in particular, to the state of the evidence as a whole and the complete absence of evidence adduced by Mr Anderson in corroboration of his assertions concerning the true nature of his relationship with the appellant and as to his allegations concerning the appellant’s complicity in “money laundering”. Whilst the Arbitrator reached no conclusion concerning those latter allegations, acceptance by the Arbitrator of the truthfulness and reliability of Mr Anderson’s assertions otherwise constitutes error on his part. I would uphold ground two.
As to ground three I note that at the hearing of the appeal Mr Stockley made it clear that no argument concerning suggested denial of procedural fairness was to be relied upon. However, it was argued that the Arbitrator had erred in refusing leave to admit the late evidence of Mr and Mrs Mohammad which was the subject of the Application concerning the admission of additional evidence addressed at [13] above.
The appellant’s attempt to tender the evidence before the Arbitrator came very late in the protracted proceedings. The evidence had been prepared much earlier than notice of same had been given to Mr Anderson. The delay was not adequately explained. The Arbitrator properly, in my view, took into account that further delay of the proceedings would have been occasioned by permitting the belated tender of that evidence. The appellant’s complaints concerning this ruling of the Arbitrator is rejected.
It is implicit in my findings concerning ground one that the Arbitrator has failed to properly address the evidence, in particular concerning the questions of credit and onus of proof. My view is that there has been a failure on the Arbitrator’s part to provide adequate reasons for his conclusions. Ground four is upheld.
Ground five suggests error concerning the Arbitrator’s findings as to incapacity and weekly entitlement. The Arbitrator’s finding of continuing total incapacity was made in circumstances where partial incapacity from 9 December 2010 was conceded by Mr Anderson in written submissions dated 6 January 2012. The Arbitrator’s findings concerning pre-injury earnings and probable earnings were made in the absence of sufficient evidence. Should I be in error concerning the question of proof of deemed employment, I consider that a need would arise for remitter of the matter to an Arbitrator for hearing afresh of the disputed issues concerning the extent of incapacity and quantum of weekly entitlement.

DECISION

The determinations and orders made in paragraphs one, two, five, six, eight and nine of the Certificate of Determination dated 9 May 2012 are revoked.
Paragraph four is amended by its deletion and substitution as follows: “Awards for the First, Second and Third Respondents”.

COSTS

No order as to costs of this appeal.

Kevin O'Grady

Deputy President
28 November 2012

I, MARGOT UNDERCLIFFE, 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

Date	Invoice Number	Addressee	Amount	Detail
20.02.07	1135	Appellant	$7,700 (incl GST)	Job North Ryde
-	1145	Appellant	$1,650 (incl GST)	Paid 22.07.08; Job Thornleigh Woolworths
30.07.08	114	Appellant	$4,680	Job Sussex St
-	1145	Appellant	$2,200 (incl GST)	Paid 11.09.08; Job Parramatta swimming pools
31.10.08	146	Appellant	$11,000 (incl GST)	Job Sussex St; paid in two instalments
28.11.08	1148	Appellant	$3,660	Job Rock Pool
06.01.09	1150	Appellant	$2,000	Job Rock Pool
20.04.09	-	Eco Choice	$3,300 (incl GST)	Job Marayong Woolworths
20.05.09	103	Eco Choice	$2,200 (incl GST)	Job North Ryde
30.05.09	-	Appellant	$4,800	Star City
30.06.09	1003	Classic Finishes	$3,300 (incl GST)	Job Wollstonecraft
17.06.09	-	Eco Choice	$1,100 (incl GST)	Job Star City
18.06.09	-	Eco Choice	$1,500	Job Star City
30.06.09	109	Appellant	$6,600	Date 31.07.09 crossed out; paid in four instalments; Job North Sydney