Smith v Aircraft Maintenance Services Australia (AMSA) Pty Ltd
[2017] FCCA 1846
•31 July 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SMITH v AIRCRAFT MAINTENANCE SERVICES AUSTRALIA (AMSA) PTY LTD | [2017] FCCA 1846 |
| Catchwords: INDUSTRIAL LAW – Competency of witness – s.63 Evidence Act 1995 (Cth) – s.135 Evidence Act 1995 (Cth)– discretionary exclusion – is probative value outweighed by prejudicial effect of evidence –is probative value of evidence outweight by misleading and confusing nature of evidence. |
| Legislation: Fair Work Act 2009 (Cth) Evidence Act 1995 (Cth), ss.63, 67, 135 |
| Fair Work Ombudsman v Ecosway Pty Ltd [2016] FCA 296 |
| Applicant: | BRIAN SMITH |
| Respondent: | AIRCRAFT MAINTENANCE SERVICES AUSTRALIA (AMSA) PTY LTD |
| File Number: | BRG 433 of 2015 |
| Judgment of: | Judge Vasta |
| Hearing date: | 31 July 2017 |
| Date of Last Submission: | 31 July 2017 |
| Delivered at: | Brisbane |
| Delivered on: | 31 July 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr J.W. Merrell |
| Solicitors for the Applicant: | Hall Payne Lawyers |
| Counsel for the Respondent: | Mr A. Herbert |
| Solicitors for the Respondent: | McCullough Robertson Lawyers |
ORDERS
That the representation made by Brian Leigh Chisholm Smith to his solicitor in an affidavit filed 21 September 2016 is not to be admitted as evidence in these proceedings.
That the matter be adjourned for mention only to 9:30am on 14 August 2017 in the Federal Circuit Court of Australia at Brisbane.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 433 of 2015
| BRIAN SMITH |
Applicant
And
| AIRCRAFT MAINTENANCE SERVICES AUSTRALIA (AMSA) PTY LTD |
Respondent
REASONS FOR JUDGMENT
(Ex tempore)
This is an application to admit evidence pursuant to s.63 of the Evidence Act 1995 (Cth). The background to the matter is, in short compass, the following: the Applicant worked for the Respondent company from 2003 until his resignation in June 2014. The Respondent company maintained aircraft at the Gold Coast Airport.
The Applicant had extensive experience in the sort of maintenance required, which was, in effect, to ensure that the aircraft that had landed at the Coolangatta Airport were checked over and in proper working order to enable them to then turn around and fly off.
On the evidence before me, it was anticipated any person working in such a manner, as was anticipated that the Applicant would be working, would be at the airport for about 20 minutes before the arrival of the plane so as to get the workshop and bay ready for the maintenance check. The actual maintenance check would take around 50 minutes, and then to tidy up and complete what was needed to be completed would take another 20 minutes.
It was anticipated that this transit time would therefore need about 90 minutes of an aircraft maintenance engineer’s time.
In 2003, there was not a significant amount of air traffic at the Coolangatta Airport. Given that the licensed aircraft maintenance engineer would only need around 90 minutes per transiting aircraft to do their job, it’s not surprising that the Respondent company chose to contract this work out.
In 2003, there was no award for the category of work that the Applicant was doing. In 2010, a new Modern Award that detailed the regime for workers in the aviation industry came into being. On 20 May 2015, some 11 months after his resignation, the Applicant began proceedings in this Court, claiming that he was wrongly categorised as a contractor and should have been an employee. If that primary argument is accepted, he argued that he was owed money, conceivably well over $300,000.00.
As well as this, he argued that, because of the breaches of the Fair Work Act 2009 (Cth) (“FW Act”), the Respondent company should also be liable to civil penalties.
On 21 September 2016, an affidavit under the hand of the Applicant was filed in this Court. It is some 635 pages in length. However, most of that was due to the voluminous nature of the annexures to the affidavit. In that affidavit, the Applicant affirmed that he was offered a position in 2003. It was part time, and based on the number of arrivals of planes, and it assumed a three hour turnaround for planes.
There was no discussion about annual leave, sick leave or personal leave. He was given a subcontractor agreement.
He claims he was told to get an Australian Business Number (“ABN”). He claims he did not know the difference between a contractor and an employee. He claims he did not know why he needed an ABN. He points out that many of the terms in the subcontractor agreement relate to employment. He claims that he was given an employee number.
He said that he knew in 2007 the Respondent company was bought out by a subsidiary of Singapore Airlines, but that his employment continued in the same way. He said that he was asked to sign a new subcontractor agreement every year.
He said that he has no copies of any of the agreements before 2009 and annexed to his affidavit four agreements: 2009, 2010, 2011 and 2012. It is safe to assume, then, that the 2012 agreement was in force at the time of his resignation in June 2014.
Those contracts speak of a flat rate for a plane in transit that is paid for a notional three hour turnaround, notwithstanding that the average turnaround might be more in the order of 90 minutes. The contracts also allow for a flat rate of pay should such transit exceed three hours. The Applicant, in the affidavit, also described his qualifications, and the work that he actually performed for the Respondent company.
He spoke of how he used his own tools, how he wore uniforms, how he worked to a roster, and many other aspects that could give rise to a conclusion that he was an employee. He claimed that he often worked outside of the hours specified in the contract, and gave examples of the times in which he claimed for those extra hours. Those times that he claimed for extra hours were paid by the Respondent company. He also claimed that there were many other hours that he did not record.
He explained that, in 2002, he had formed a company called Ultimate Goal Enterprises Pty Ltd, and that this company had been given an ABN.
He also explained that, at about the same time, he was given an ABN “as a sole trader”.
He said that the company, Ultimate Goal Enterprises, was deregistered in 2009. He said that he did his tax returns every year.
On the face of that affidavit, there are many aspects that do seem contradictory and would need a far more fulsome explanation in the course of a trial.
In February 2015, the Applicant suffered a stroke. Notwithstanding this, he was still confident enough to instruct solicitors to commence the proceedings in this matter, which were filed around three months after the Applicant suffered his stroke.
By November 2015, the Applicant was residing at the Bupa Aged Care Facility at Tugun. His solicitor noted that, upon meeting the Applicant for the first time in January 2016, the Applicant had a physical disability, as he was in a wheelchair and could only move one side of his body without assistance.
Whilst he was slow in his speech and slurred his words, the Applicant was able to give lucid instructions to his solicitor. There were times that he had some difficulties, but it was not so much that his solicitor thought that there was any problem with the instructions he was being given. The Applicant had already given his partner, Ms Kenway, power of attorney.
At directions hearings, it became clear that the health of the Applicant was starting to become an issue. I was told that the Applicant would not be able to leave his nursing home for any great length of time. The Court looked at having the matter heard in Southport, or even having a special hearing at the aged care facility. Ultimately, none of these were practical, but because of advances in technology, it was possible for the Applicant to be present in the courtroom by use of Skype.
On 6 March 2017, I heard an application where the main issue was whether or not the Applicant could give evidence. On that day I heard from a Dr Bradley Ng. Dr Ng had examined the Applicant and, whilst noting that there were some pronounced deficits, opined that the Applicant was still competent to give evidence and to make decisions as to the conduct of the trial.
Dr Ng noted that he could not guarantee that the Applicant would be able to endure the trial but said that “the proof of the pudding will be in the eating”. Having heard that evidence, I allowed the trial to continue and set it down for hearing for four days, which was to commence today.
However, last week I was informed that Dr Ng had conducted another examination of the Applicant, and now Dr Ng deemed that the Applicant was not competent to conduct his trial, nor was he competent to give evidence in the matter.
On 27 July 2017, I made an order appointing his son as his litigation guardian. Counsel for the Applicant foreshadowed that he was making an application that the trial continue, and that I receive the evidence of the Applicant as his affidavit and proceed under r.15.29A of the Federal Circuit Court Rules 2001 (Cth). I remarked to Counsel that I saw this matter more as a matter pursuant to s.63 of the Evidence Act 1995 (Cth).
The Applicant has now decided to ask for the Court to utilise section 63. That section reads as follows:
“63 Exception: Civil proceedings if maker not available.
(1) This section applies in a civil proceeding if a person who made a previous representation is not available to give evidence about an asserted fact.
(2) The hearsay rule does not apply to:
(a) evidence of the representation that is given by a person who saw, heard or otherwise perceived the representation being made; or
(b) a document so far as it contains a representation, or another representation to which it is reasonably necessary to refer in order to understand the representation.
Note 1: Section 67 imposes notice requirements relating to this subsection.
Note 2: Clause 4 of Part 2 of the Dictionary is about the availability of persons.”
What this means is the Litigation Guardian was asking that the solicitor, who took the affidavit and witnessed the Applicant affirming each and every page of that affidavit, be allowed to give evidence of the fact that the Applicant had made the representation which is, in fact, his affidavit. This would mean that the affidavit would then become admissible. The affidavit would then be entered into evidence as truth of the facts contained therein.
Quite rightly, the Respondent has objected because there has not been proper notice given to the Respondent, pursuant to s.67 of the Evidence Act 1995 (Cth), and it wasn’t until I suggested that the solicitor would be giving evidence of the representation that the Applicant even thought about the way with which s.63 of the Evidence Act 1995 (Cth) would be complied.
However, those are technical arguments as to why this section should not be engaged. The defects that are pointed out can be cured with adjournment and some time given to the Applicant to put things in order. The more fundamental question is whether the discretion to exclude evidence pursuant to s.135 of the Evidence Act 1995 (Cth) should be exercised. That section reads as follows:
“135 General discretion to exclude evidence
The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might:
(a) be unfairly prejudicial to a party; or
(b) be misleading or confusing; or
(c) cause or result in undue waste of time.”
In looking at this question, I must be aware of how the representation is probative of the issues before me and whether the prejudice, in simply allowing the representation to be admitted as truth of its contents, outweighs the probity of the representation. The major question here is whether the Applicant was truly an employee or whether he was a contractor.
I have been helpfully referred to by Counsel for the Applicant to the authority in which such matters were recently summarised, that being Fair Work Ombudsman v Ecosway Pty Ltd [2016] FCA 296. In that case, White J relevantly stated at paragraph 71:
“The law has not been able to identify a single test to be applied in determining whether a given relationship is one of employment or one for the provision of services. It adopts, instead, a multifactorial approach. Perram J summarised the position in ACE Insurance v Trifunovski …at first instance, at [29]:
[F]irst, the distinction between an employee and an independent contractor is ‘rooted fundamentally in the difference between a person who serves his employer in his, the employer’s business, and a person who carries on a trade of business of his own… secondly, the answers to that question are to be determined by reference to the ‘totality’ of the relationship…thirdly, a number of indicia have accreted over time in the authorities which are thought to throw light to varying degrees on the outcome without being determinative: The terms of the contract; the intention of the parties; whether tax is deducted; whether sub-contracting is permitted; whether uniforms are worn; whether tools are supplied; whether holidays permitted; the extent of control of, or the right to control, the putative employee whether actual or de jure; whether wages are paid or instead whether there exists a commission structure; what is disclosed in the tax returns; whether one party ‘represents’ the other; for the benefit of whom does the goodwill in the business inure; how ‘business-like’ is the alleged business of the putative employee – are there systems, manuals and invoices; and so on – the list is neither exhaustive nor short…”
There are a number of oddities with regard to the representation made by the Applicant to his solicitor which are contained in the affidavit. The most obvious one is the subcontract agreements. The Applicant has provided four of these agreements, though the 2012 agreement is not signed.
The agreements are clearly between Ultimate Goal Enterprises Pty Ltd, and the Respondent company. It does not make sense that if the Applicant had no idea of the difference between a contractor and an employee that his contracts of employment would be between his company and the Respondent company rather than just himself and the Respondent company.
It also does not make sense that if the Applicant, as he said, did not know why an ABN was needed or what an ABN was, that he would have actually had an ABN for about 12 months before he began working for the Respondent company.
The invoices that the Applicant sent to the company were all from Ultimate Goal Enterprises until November 2011. After 12 November 2011, the invoices are all headed Brian Smith Aircraft Engineering, with exactly the same ABN and bank details. There is no explanation in the affidavit as to why this is so.
It becomes even more confusing if one accepts that the final contract, which is not signed, is still between the company of the Applicant and the Respondent company. That contract would have come into existence some eight months after the Applicant started sending invoices in the name of Brian Smith Aircraft Engineering. If the company was deregistered in 2009, why were the contracts and the invoices still bearing the name of a deregistered company?
The tax returns also show that the Applicant was paying his tax from money given by the Respondent company to Ultimate Goal Enterprises. The Applicant was claiming business deductions against those payments so as to reduce the amount of tax that he would have to pay.
The Applicant claimed that he had visited his accountant every year and lodged tax returns. This is not borne out by what he has annexed to his affidavit. It seems that the tax returns for the 2012, 2013 and 2014 financial years were all lodged on the same day.
There is no evidence of the Applicant ever raising the issue of whether he was an employee with the Respondent company until after he had left, and therefore no explanation as to why this was not done.
On these issues alone, one can see that the affidavit itself might be misleading or confusing.
The evidence contained in other affidavits filed by the Respondent company take issue with a number of matters contained in the representation of the Applicant. For example, the Applicant said that he was given an employee number. The material for the Respondent company suggests that this was not an employee number but was a number given by Air New Zealand so that they knew who was looking at their aircraft at any particular time by looking at the paperwork.
There are a number of other such examples of contrary evidence which would need to be put to the Applicant during evidence so as to allow a Court to ascertain what the true state of things actually is. Such material goes to the heart of what was the relationship between the Applicant and the Respondent company, and whether that was one that was truly one of employee and employer, or subcontractor and contractee.
The extent of the prejudicial effect is evident when one wonders how the Respondent company can now fully test those matters that the Applicant has affirmed in the affidavit.
Therefore, whilst the evidence of the solicitor of the representation given to him by the Applicant is admissible pursuant to s.63 of the Evidence Act 1995 (Cth), I am of the view that, pursuant to s.135 of the Evidence Act 1995 (Cth), I should exclude that evidence from the proceedings because the probative value is substantially outweighed by the danger that the evidence might be unfairly prejudicial to the Respondent company and the danger that the evidence is misleading and confusing.
I certify that the preceding forty-five (45) paragraphs are a true copy of the reasons for judgment of Judge Vasta
Date: 8 August 2017
0