State of South Australia v Sgobino

[1988] HCATrans 13

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No A37 of 1987

B e t w e e n -

THE STATE OF SOUTH AUSTRALIA

Applicant

and

MLADENKA SGOBINO

Respondent

Application for special leave

to appeal

WILSON J

DAWSON J

GAUDRON J

Sgobino

TRANSCRIPT OF PROCEEDINGS

AT ADELAIDE ON FRIDAY, 19 FEBRUARY 1988, AT 11.22 AM

Copyright in the High Court of Australia

AlT8/ 1/HS 1 19/2/88

MR J.J. DOYLE, QC, Solicitor-General for South Australia: May

it please the Court, I appear with my friend,

MR M.A. STEVENS, for the applicant.

(instructed by the Crown Solicitor for South Australia)

MR J.P. McCUSKER:  If it pleases the Court, I appear with

my learned friend, MISS H. MARTIN, for the respondent.

(instructed by Johnston Withers Mccusker and Co)

WILSON J:	Yes, Mr Solicitor.
MR DOYLE:	If the Court pleases, in the applicant's submission

there are two reasons why special leave should be given

in this matter, even though in 1986 this Court, and

I think two 0£ Your Honours in STEVENS V BRODRIBB

reviewed a number of the principles relevant in this
general area, and so Your Honours may be coming to

it with something of a sense of deja vu - - -

WILSON J:  I think we demonstrated how difficult it was to

determine particular cases.

MR DOYLE:  One might say, Your Honours, that Your Honours

demonstrated with what felicity and ease the High Court

can determine these matters, but that might seem

like flattery on my part. Your Honours, the first

reason, it is submitted, is that there is here a
question of law of public importance because of its
general application and the question is the real

nature of the control which is relevant for the

purposes of the control test, and could I come back

to that in a moment, saying no more at this stage

than that while the control test is not; of course,

an exclusive or dominating test, it has been accepted

as a very important test in this area.	So I will
come back to that in a moment.

The second reason, it is submitted, is one

falling under the head of the interests of the

administration of justice, and that is simply that the
applicant has engaged over 200 people for the same

task, interpreting,, on the same basis, and this

decision obviously has quite significant implications
for the applicant's relationship with all those
people, and it does employ quite a large number of

other people on a contract basis and the decision

has ramifications for them.

Could I come back to the first reason, the

question of law which, it is submitted, is of general importance. In our submission, control was the basis

of the majority decision. His Honour Justice Matheson

speaking for the majority, Justice Cox having

indicated that he agreed generally with his reasons,

began with the issue of control. That seems to

be, as it were, the centre of gravity of his decision.

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He referred to the organization test, but this Court

has expressed some doubts about the utility of that

test, and His Honour appeared to use it only as a

makeweight. The balance of his judgment was

primarily directed to negativing matters which were

persuasive with the majority of the Full Court.

In our respectful submission what is relevant

and what one really has to look for is control by

the employer, if I can notionally underline those

words, in the performance of the work, and the argument

of the applicant - - -

GAUDRON J:  That has already been rejected, though, has it not,

in respect of the trapeze artists?

MR DOYLE:  Your Honour, with respect, no, I do not - I was

about to say I do not put any particular weight on

the latter part "in the performance of the work".

It is "by the employer" on which I put the weight

and, in my submission,, "control by the employer"

is to be distinguished and must be distinguished from controls which are dictated in fact to the employer,

the putative employer, as much as to the worker, by
the nature of the task which is given, and or

alternatively controls which do no more - if you call them controls - which do no more than illustrate that

the person for whom the work is done has an interest

in the quality of the performance of the task.

Perhas if I could illustrate what I mean,-

because my submission will be that the court ignored

that distinction, and that it is an important
distinction - by referring first of all to ZUIJS's

case, the WIRTH BROS case, and then to the facts of this case to indicate where, in my submission,, the

court erred. I do not, Your Honours,wish to

read from ZUIJS's case. It is probably sufficient

just to remind Your Honours that that was the case of

the trapeze artist employed by Wirth Bros Circus,

and the Court there acknowledged that one could not

over the manner in which the man performed his act	in any meaningful sense suggest there was control
while up on the high wire, or swinging, or whatever.
So what the Court looked to were control in subsidy or ancillary matters, and the things it referred to were things like where in the programme the act
appeared, how frequently and when rehearsals were to
be done - and presumably the when was relevant
because other people might want to use the tent - the
costumes to be worn, whether the people participated in the grand parade, and whether, I suppose, they
sat on an elephant or jogged around waving, that sort
of thing.

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The Court looked to those things and while one

can say that in the nature of things obviously
a decision had to be made - it could not just be left,

as it were, completely at random when Mr Zuijs came	on - but nevertheless, in ZUIJS V WIRTH the decision
was made by the employer, and also the employer,
obviously, had a real discretion. He could say,
"You come on first, you come on last, you come on in the middle, you do wear spangles, you don't wear
spangles", that sort of thing, so while only in the
very broader sense can you say a decision had to be
made, that the fact was the employer in ZUIJS was making those decisions and had a real element of choice.

When we come to the facts of this case, the

Court focused on relatively few matters and the matters

which the judgment highlighted were these: first of

all, the fact that the interpreter was told when and

where he or she would do the interpreting. Our

respectful submission is that that is not in any

sense an illustration of control because the employer

was not, as it were, dictating this. The fact is that

an interpreter was needed, say, at the Port Adelaide

court on 19 February at 10.30, and the employer was
simply ringing up and saying, "This task is available

to be done. Are you willing to do it?" It was not

a case of an interpreter who was, as it were, engaged

generally and then was rung on that day and said,

"Here's the job you're doing", nor was it even an

interpreter engaged for the day and then told, "Here's

the job you're doing." It was simply a case of the

putative employer ringing up and saying - I assume

this was done on the morning; perhaps the day before

"We need an interpreter at Port Adelaide on" this

day and at this time. Now, in my submission, that

is not indicative of control even in ancillary or

subsidiary matters. It is just that that is the job

to be done. So, in my submission, that is truly a

control dictated - you can say, either just
the fact of the task to be done or by its nature -

but nowhere there is the employer exercising

discretion or choice.

DAWSON J: Is that right? I mean, once the interpreter has

said, "Yes, I am available, I accept the offer to go

to" wherever it is, she then would be directed to go

there and to interpret, would she not?

MR DOYLE: But, Your Honour, in my submission - - -

DAWSON J: And if she did not, well then, her services might

be dispensed with.

MR DOYLE:  But, Your Honour, in my submission, with respect,

it is almost meaningless to sever the two because the

interpreter would hardly say, if the commission rings

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up and says, "We want an interpreter at Port Adelaide tomorrow at 10.15", the interpreter would hardly say,

"I accept", and then when told, "Port Adelaide, 10.15",

say, "Oh no, that's no good." In other words, the

offer simply is, ''To interpret at Port Adelaide at 10 .15

tomorrow", and in my submission, one cannot discern in

that any element of control. That is to confuse control

with simply the nature of the task that is being

offered.

Could I just give another illustration from the

legal area? If say, the Royal Automobile Association,

as I assume it does, retained a solicitor to handle most

of its guilty pleas and rang him at the beginning of a

week and said, "We have got two at Port Adelaide on submission, one would not say, "Well now, here are

illustrations of an employer exercising control. Is

that outweighed by the fact that the solicitor is running
his own business and so remains an independent contractor",

in my respectful submission, one would say, "Well, that's

not control at all, it's just that a plea needs to be done
on that day at that place, and if you ask yourself, "Now,
what choice or control is the employer exercising, what

discretion has he exercised?", one can say nothing more

than that he had a choice whether or not to offer the

job. But he had no choice over whether it was a job

at another place or at another time because once he

said, "I'm offering the interpreter this job", well, the

job itself defined all those features. So, my submission

is that that factor in particular highlights the confusion

in the-:-courti-s :mind between control over what are subsidiary inatt.ers-- and =controls which are dictated by . the nature of the

task itself and, in my submission, that is what happened

nere.

The court, Your Honours, referred, I think~ to one

or two other matters, apart from the "when and where

the job was done." The court placed some reliance upon

the use of departmental forms when claims for payment

were being made but, in my respectful submission, that

really is a very neutral factor, if of any significance,

whatever the relationship, to give an indication of the	because one would tend to expect any large organization,
manner in which it wanted claims for payment submitted.

GAUDRON J:  But it does indicate one aspect, does it not, and that

is that the interpreter was in no position to negotiate

her own terms? Now, when a person is in no position, as

it were, to negotiate the terms upon which they will

perform work, it is take it or leave it.

MR DOYLE:  Yes.

GAUDRON J: It does sort of indicate some feature that is much

more commonly associated with employment than with a

contract of independent services, at least, does it not?

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MR DOYLE:  Well, Your Honour, in my respectful submission, it is

a bit dangerous to infer here that it truly was a "take it" or "leave it" basis. We do not have the evidence before us

and frankly I am not sure to what extent - - -

GAUDRON J: All the rates were fixed quite independently of any

opportunity for negotiation with an individual interpreter,

is that not correct?

MR DOYLE:  Yes, Your Honour.

GAUDRON J: And all the allowances: travelling allowances,

travelling times, were all fixed?

MR DOYLE:  Yes.

GAUDRON J: And they were precisely the same, whatever language,

is that not the case?

MR DOYLE:  Yes.

GAUDRON J: And whatever court?

MR DOYLE:	So I assume, Your Honour. Knowing the way the public service works, it was all laid down somewhere and chiselled
in stone, as it were. But, Your Honours, in my respectful
submission, that may be moving from the area of what has
typically been called "control in the performance of the
work", albeit subsidiary matters, to simply an economic fact that there is really only one person in the market
seeking or offering work in this area and that, as to his rates, well, you either take it or leave it and there may
be certain organizations which present a sufficiently
forbidding aspect for one to think it is not worthwhile
trying to negotiate. It does not really prove that, in fact - - -

GAUDRON J: Would you go so far as to say these interpreters

would be incapable of having an award made in their favour

by the Industrial Tribunal in the hearing of which they

were entitled to participate?

MR DOYLE:  Your Honour, I am hesitant to answer simply because,

off the cuff, my knowledge of the powers of the tribunal

is not sufficient for me to be absolutely certain whether

the line between employee and independent contractor is

completely decisive.

GAUDRON J: It is certainly not decisive in workers' compensation

either, is it?

MR DOYLE:  No,. Your Honour, because of particular statutory

provisions. But, Your Honours, I would submit that

reliance upon the use of departmental forms, again, is
not really an illustration of control because any large
organization has to lay down some means by which information

is to be submitted to it.

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DAWSON J:	We are really getting into areas of emphasis.
MR DOYLE:	I accept that, Your Honour.

DAWSON J: Where did the court go wrong in the application of

established principles? That is not put very well.

Where did it misconceive the principles which it applied?

MR DOYLE:  My submission is that it misconceived them because

when it referred to the concept of control it failed to

distinguish between matters in respect of which it

could be said the employer genuinely was exercising

choices and imposing them on the worker, as distinct

from doing things which were, in fact, dictated to the

employer, as it were, by the nature of the job it had

to offer and the simple fact that the employer had to receive information, because it was a large employer,

in an organized form on a certain piece of paper.	Other
than that the court - - -

DAWSON J:  I suppose you could ask the question: "How would the

employer go about employing these people if it wanted to

employ them as independent contractors? How differently

would it go about securing their services?"

MR DOYLE:  If it wanted to make them truly independent contractors?

DAWSON J: Other than putting a clause in the contract.

MR DOYLE:  Yes. Well, in the light of a decision, off hand,

not much more does occur to me, Your Honour, other than
having a contract with one clause in big red print saying,

"I agree I'm an independent contractor" and just, in the

end, what that would achieve is questionable because

that, in itself, can only be a factor, albeit a relatively

important one.

The only other matter that the majority referred to

was, I think, two occasions when the head interpreter

agreed that he had rebuked interpreters for the manner

in which the task was done but, in my submission, again,

in this area, that is of almost no use at all because

anyone for whom a task is being done on whatever basis

must have the right to say, "Well, I'm not going to

have you doing this work again if you can't do better."
So, in my submission, bearing in mind the importance

in the majority judgment of what His Honour Justice Matheson

described as "control in subsidiary and ancillary matters",

when we look at the three things that were alluded to:

rebuking an interpreter on two occasions; saying when and

where the job is, and then, finally, the use of a standard

form, in my submission, it does suggest that the court has,

in fact, failed to draw the distinction, and probably

I would have to acknowledge that in all cases, because no

one factor is ever decisive, it could be said, if the

Court grants special leave, that in the end there is a chance the point will dissolve. But, in my submission,

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in this particular case, the intermittent nature of the

work being done, the fact that there was a finding that

each time work was done it was a separate contract, the

fact that the interpreters were free to decline or accept

as they saw fit as long as, obviously, they did not always

decline in which event, presumably, you would just

stop ringing them up, those factors suggest that this case

does present, in a fairly clear form, this issue of

principle and, in my submission, if the line is not

drawn and drawn clearly there really is a risk that the

control test will tend to disintegrate with people

confusing, as I have put it, perhaps too tediously, true
choices made by the employer in admittedly ancillary
or subsidiary matters with things that are, in truth,

imposed on the employer simply because he is, let us say,

a large employer and has a certain type of task to

offer. So, my submission is there is a clear issue of

principle there as to what is the true nature of control.

WILSON J: But is that right, Mr Solicitor1 Really, you are

asking us to take on board afresh the concept of control

and its place in the various factors that go to determine

whether a person is a servant or an independent contractor,

an attempt to give them a further and more prescribed

definition and, really, the general principles.are clear

enough. You are really complaining about their application

in this case, are you not?

MR DOYLE: Well, Your Honour, I would not be asking the Court to

reassess how important the control factor:_is and so while I

acknowledge that when you get right down to all the details

the point might dissolve-

WILSON J: And the other matters they mentioned are quite

persuasive; for example, there was no question of

delegation as distinct from, I gather, ARMSTRONG's case:

she was not allowed to delegate her assignments; she
provided no equipment; she was paid her travelling

expenses, things like that.

MR DOYLE:	Yes.
WILSON J: So, it is a composite decision that the Full Court

makes and it is pretty difficult for you, it seems to
me with respect, to isolate out a question of principle

that might get you home on an application for special

leave.

MR DOYLE: Yes. Well, all I can say, Your Honour, in answer to

that is that in my submission, if one concluded that in
truth, first of all, the where and when elements were

quite irrelevant; they were not instances of control at

all, and that secondly, the rebuking element was just a simple example of a person saying, "If you don't do

the thing well enough, I don't want to see you any more";

that one would begin to wonder, genuinely, about the

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rightness of the decision because factors that the

court saw as important were eliminated entirely. I do

accept that if you said, "Well, those factors remain in

and it is a question of weight", well then, we are just

back to matters this Court has passed on before. But my

submission is that there is a real issue of principle

here,were these matters relevant at all,and if my

argument succeeds they drop out of sight, if my argument

does not succeed, well then, I would expect the Court to

say it is not particularly concerned just to reagitate

the facts to come to a conclusion on it for itself.

But, Your Honours, that is the point of principle

and I do not think I can usefully develop it at any

further length. The only other point was the particular

effects for the applicant. That is canvassed in the

affidavit and I merely make again the point that there

are over 200 intepreters, all of whom are likewise

engaged avowedly as contract interpreters and then a

good number of other people for whom this decision would
have implications. If we just take cleaners: well,

obviously, cleaners are told to come to a certain

building a certain number of days a week and at certain

times, either presumably early morning or late evening

and, in my submission, again, it is very questionable
whether that can be called "control" granted there is the
choice - comes evening or morning - and perhaps the

State makes that choice but, again, it tends to be

dictated by when people are working there and when they

are not. But there is that second point: the implications

of the decision.

Could I say, finally, Your Honours, if I have

persuaded the Court on those matters, in my submission,

leave should not be declined on the grounds that the case

may go off on the very final point in the majority

judgment, that is, the expression "or otherwise" in the

definition of a worker. To some extent that expression

is itself shrouded in mystery but, in my submission,

in this case, because "or otherwise" has been interpreted

as looking to de facto control, if the Court concludes

under the traditional issue: master/servant/independent

contractor, that there is not control, it would almost

certainly reach the same conclusion under the "or otherwise"
head. If it is against me on the first issue, well then,
the second head is irrelevant. So, my simple point is
that the case is unlikely to go off on the "or otherwise"

point because in this particular case where we are

focusing just on is there control or not, you are likely

to get the same answer under both heads.	May it please
the Court.	-

WILSON J:  The Court does not wish to hear you, Mr Mccusker.

Unfortunately for the Solicitor the Court is against

him.

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In our view we have difficulty and we certainly

are not persuaded that there is any general question
of public importance arising in this case. In our view,

the general principles governing this topic are

sufficiently clear. There is, of course, always a

difficulty in applying those principles to a case

where questions of fact are naturally intimately

involved. This case, like others of its kind, has to be

considered on its own facts and it is not surprising

that minds may differ as to the outcome. For these

reasons special leave should be refused.

I would simply repeat what has been said before

that the refusal of leave is not necessarily to be
taken as an endorsement of the decision below or of

the reasons given for that decision. Special leave

will be refused.

MR McCUSKER:	I seek costs?
WILSON J:	You cannot oppose that; Mr Solicitor?
MR DOYLE:	No, Your Honour.

WILSON J: Special leave is refused with costs.

AT 11.44 AM THE MATTER WAS ADJOURNED SINE DIE

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