CATCHWORDS Workers! Compensation - injury suffered by person during trial before possible employment ~ whether a tyorkman" within meaning of Workman's Compensation Ordinance - whether there existed a contract of service. Appeal - Evidence ~ appeal from decision of Workman's Compensation Tribunal to Supreme Court - whether Supreme Court entitled to admit fresh evidence - whether a re- hearing de novo Workman's Compensation Ordinance (N.T.)1949 s. 26 IN THS PEDERAL COURT CF AUSTRALIA NORTHERN TERRITORY OF AUSTRALIA No. WTG 8 of 1978 DISTRICT REGISTRY GENERAL DIVISION BETYEEN: JOHN DARE (Appellant) AND: WILLIAM EDVARD DIETRICH wma {Respondent) ORDER . JUDGDS BAKING ORDin: Muirhead, Deane and Lockhart J.J. DATE OF ORDER: 21 August 1979 HHERD MADE? Darwin THE CCURT ORDERS THAT ¢ 1. The appeal be allowed. Pea The orders of the Supreme Court of the Northern Territory of Australia be set aside and that in lieu thereof the erder of the sorkmen's Compensation Tribunal sitting at Alice Springs including the order that the respondent pay the appellantts costs of proceedings before the said Sribunal be restored. The respondent pay the appellant's coats of proceedings Lo) e before the said Supreme Court 4nd before this Court. Date Intereds 220k Cherpecal, IG7S Bente NORTHERN TERRITORY TL THD PEDAL COuke Gr AUSTRALTA NOMS OS ST RRELORY OF AUSTRALTA Roe eG 8 of 71978 Ht DITRLICD NEGIN By erro DIVECIGH BPRELDRY: JSON DARD (Appellent) AUD: UILLIA TMIUARD DINeRICH (Respondent) OR PER el ea USL, USkiuu Gilbwedg sudrhead, Leane and Lockhart did. OAK Geo Ohne 27 dugust 1979 Via st TD s Darwin GS CCUns ORD SH, : 1. 'whe appeal te allowed. & be orders of the Cuprene Court of the lorthern Territory of fusteclin be cet aside and that in licu thercof the order of the orbmen''s Cemicncution Tribunal citting at {lice 'prings including the order that the respondent pay the aupelloantts costa of proceedings before the said Fplibunal be restored. ) 3. The respondent pay the appeliant's costs of proceedings teforo the said Cuprene vourt and before this Court. Dato Latereds D2n.ck eapperol, IF7g PUEUTY DISPTRICR REGISTRAR & SS bay ' . t IN THE FEDERAL COURT OF AUSTRALIA ) ) NORTHERN TERRITORY DISTRICT REGISTRY) No, NTG 8 of 1978 ) ) GENERAL DIVISION ON APPEAL FROM THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA BETWEEN ¢ JOHN DARE Appellant (Respondent) AND: WILLIAM EDMUND DIETRICH Respondent ; (Appellant) CORAM: Muirhead, Deane and Lockhart JJ. oY £97, REASONS FOR JUDGMENT MUIRHEAD Js I have had the opportunity of reading 'the reasons of my brother Deane in which he sets out the unusual circumstances leading to the respondent's injury in respect of which he claimed compensation. There is no necessity for me to reiterate these matters. Furthermore, I respectfully adopt his Honour's views as to the nature of the appeal itself. I agree that the further evidence adduced upon the Appeal to the Supreme Court of the Northern Territory was properly admitted by the learned Judge and there is nothing I wish to add. This being so and in view of the course taken in argument before us the only remaining issue is whether the learned Judge was correct in setting aside the Tribunal's findings that "no contract had been entered into, but purely a trial" and that at the time he suffered injury, the respondent Dietrich was not a workman within the meaning of the Workmen's Compensation Ordinance 1949 - (Northern Territory). This Ordinance (Section 6) in so far as it is relevant for present purposes, defines a "workman" in the following terms - "tyorkman' means any person who has entered into or works under a contract of service or apprenticeship with an employer, whether by way of manual labour, clerical work or other- wise, and whether the contract is expressed or implied, or is oral or in writing..." certain provisions follow which deem persons in various situations to be workmen within the meaning of the Ordinance but it is agreed that they do not apply. The appellant employer, by his Answer to the Application for Arbitration, denied that the respondent was a workman within the meaning of the Ordinance and it was to this issue that the Tribunal directed its attention and based its decision in favour of the present appellant after a very short review of facts. In their joint reasons for decision the members stated - "Prom this evidence it is obvious that at that stage no contract had been entered into,- but purely a trial, and this was clearly in the minds of both parties. If the applicant could do the work he would be put on as a contractor." Upon the appeal to the Supreme Court the learned Judge rejected the arguments advanced that the arrangement between the parties was in the nature of a social agreement and he clearly regarded the appellant's offer to pay $2 per hour as significant. He observed that the giving or promise of payment 'of money is a factor usually treated as prima facie evidence of a contract. He found the contract to be a contract of service under the Ordinance. , The circumstances under which the parties entered upon their discussions are of importance. The respondent Dietrich was introduced to the appellant by one Mr Wylie who was manager of Griffith House in Alice Springs where the respondent was then resident. Wylie was anxious to assist the rehabilitation of the respondent who was physically disadvantaged by Huntington's Chorea and who had a "problem with alcohol". The effects of this disease are clearly described by the learned Judge. Dare was known to Wylie as a person who had in the past assisted in placing people in employment. He was in an honorary capacity secretary of the local Chamber of Commerce. The suggestion as to house painting was put forward by the appellant in his efforts to find a programme by which to aid the respondent's rehabilitation. In fact, he had not considered painting the hcuse beforehand and he said in evidence that it did not then really need painting. The evidence of Wylie was that when the respondent was asked whether he would be able to paint a house he replied "I think I can, or I'll give it a try or I'll give it a go." ° This is confirmed by Dare's evidence who stated that after he asked the respondent whether he could paint the house the latter replied "Oh, I think I could, I°1ll give it a go." The respondent Dietrich agreed that the real arrangement was that he was on trial as to whether or not he could paint the appellant's house and he acceded to the suggestion that after his capability had been tested he "expected to work out an arrangement". The respondent himself did not recall a discussion as to payment during the trial period. He stated he "would have been prepared to accept anything at all. The amount could have been $3 or it could have been $2 an hour or it could have been less". The appellant's offer to pay $2 per hour appears to have been spontaneous and gratuitous, neither the result of bargaining nor discussion. He told the Tribunal "I was a bit embarrassed about speaking to him directly about his condition". It is clear from his evidence that he did not consider he had entered into a contract of any type ""...I didn't consider him really as a workman, he was somebody I was helping out". It was the respondent's intention to give the appellant a trial to see whether he could indeed cope with the task, not a surprising arrangement in view of the, description of the respondent's physical disabilities. The appellant, aware of these disabilities, did not wish the respondent to participate in the painting trial on his house without some recompense ~ hence the offer to pay $2 per hour as a temporary arrangement - a gesture readily understandable when one looks objectively at the factors motivating the trial. Clearly it was contemplated an agreement as to painting the house (whatever relationship it may establish) would only be reached after the respondent's capacity to do such work had been fairly tested to the Satisfaction of both men. fhe notice of appeal challenged the learned Judge's finding that the respondent was at the material time a workman within the meaning of the Ordinance and his finding that there was a contract between the parties. However, during the course of this appeal the appellant's counsel directed his principal argument against the finding that there was a contract of service, his basic contention being, not that there was no contract, but that any legal relationship between the parties was a contract for services, not a contract of service and that the respondent when he fell was, (and would have been in any event), an independent contractor. Before the Tribunal the onus lay on the appellant to prove that a legal relationship had been established and that it was a contract of service. I have some doubts upon the evidence as to whether there was in fact a contract of either type. . Without the appellant's spontaneous offer to pay $2 per hour during the testing period clearly there was no contract at all and I can understand the distinction the Tribunal raised between "trial" and "contract". But in any event even assuming a legal relationship was established at this stage, it could not in my view be classified as a contract of service. Mr Maurice stressed in argument that there were in the arrange- ment few features common to the employer-employee relationship, features which have been examined by the courts over the years in a multitude of cases. Evidence of the appellant's control or right of control over the operation was indeed meagre. His Honour in the course of his judgment, when Gealing with the question of control stated - : "It seems to me that it is a fair inference to draw from the whole of the evidence that the appellant was on probation and his appointment was terminable at short notice after he had demonstrated his capabilities. Not only did the respondent have the right to dismiss the appellant at any time after a fair trial, but I find that he also had the right to direct what work was to be done and how it was to be done. According to the respondent it was the appellant who suggested that the first thing that should be done was the guttering and suggested that the respondent obtain a wire brush for that purpose. This suggestion emanated from the appellant, as also did the suggestion that the leaves should be removed from the gutters. The respondent acceded to these suggestions and in effect directed the appellant to do those things." . It is true that upon the evidence the respondent informed the appellant that he would require a wire brush and he also suggested the leaves should be removed. But it was the respondent's own decision that he should commence his work on the guttering. It is also true to say that the appellant acquired and in fact purchased a wire brush and other materials. But with respect, looking at the whole circum- stances of these initial discussions, I do not agree the evidence justified the finding that the appellant "in effect directed" Dietrich to do these things. The finding that the respondent had the right to dismiss the appellant after a fair trial, suggests that he had previously employed him under a contract of service which appears contrary to the evidence, as by both accounts it was but a trial. The finding that "he had the right to direct what work was to be done and how it was to be done" may have been open by way of inference, but the evidence was to the effect that it was the respondent alone, who decided where to start work, what ladder to use, what materials he required and how he would go about his work. The appellant on these matters relied as he said on the judgment of the respondent who asserted some relevant experience. And of course the fact that a houseovner may be said to reserve unto himself the right to terminate the services of a true painting contractor would not in itself change the nature of the relationship, whatever other legai consequences there may be. The evidence was that the appellant was prepared to leave issues such as method, hours of work, times of work and the duration of any arrangement to suit the convenience of the respondent, once the respondent's capability had been established. The appellant when asked in cross examination whether he had arranged to see the respondent later in the day (of the injury) stated "No, the occasion wouldn't have arisen because I had intended being there most of the morning and~ if I had been going away I would have sent him home." This was referred to by the respondent's counsel as evidence of control or residual control but in its context I do not so read it. As I read the evidence the appellant, who was to remain home, believed he could assess the respondent's abilities within a "couple of hours". That answer must also be considered in the context of the respondent's own evidence that his capacity to work steady or ordinary hours was in doubt. The learned Judge rejected the contention that the parties did not intend to create legal relations in their arrangements. He found that the agreement bore "the appearance of a commercial agreement" and referred to the presumption that may thus arise as to intention to create legal relations. He considered the fact that the parties were strangers tended to negative the argument that there was no contract and he categorised the appellant as being in the "dominant position", True it is that considerations of family, domestic or social arrangements did not arise in this case but the philanthropic motivation and the circum- stances under which the initial arrangement was reached appear to me to be at odds with the learned Judge's classi~ fication of the agreement as a "commercial agreement" and the appellant as being in a "dominant position". He was merely a person who was anxious, with some personal involement, to assist the plight of another who was down on his luck. I do not propose to deal with the many cases cited by counsel on the question as to whether any relationship established ? was a contract of service or a contract for services. Ifa contract existed it lacked in my view the character of a contract of service. The essential distinction was succinctly enunciated by the South Australian Full Court, the judgment of which was read by Napier J. in the old decision of Haupt v. Haupt (1929) SASR 393 at 396. "The first question is whether the contract requires the party to do the work in question, or merely to procure it to be done. A contract to supply any particular product or to procure certain work to be done is not a contract to work for the employer (Chisholm v. Walker & Co. (1909) Sess. Cas. 31, and Underwood v. Perry & Son Ltd. (1922) 15 B.W.C.C. 131, and ibid 257). The next question is the power of control which distinguishes a contract of service from a ° contract for services (Templeton v. William Parkin & Co., (1929) 140 L.T. 519). There may be exceptional cases, but, speaking generally, we do not think that any person can be said to work for another unless he is, in some respect, bound to obey directions that may be given him. The distinction is between a contract which specifies the work and enables the other party to require performance according to the speci- fication, but gives no further power of control, and a contract which reserves to the master or employer the right to direct what work is to be done, or the manner in which it is to be done. It is immaterial whether any control is actually exercised if the power to control exists." The definition of "workman" was there different but the relevance of this passage remains. So too Latham CJ. summarised the distinctive features of the two classes of contract in Humberstone v. Northern Timber Mills (1949) 79 CLR 389 at 396 - "Tf the work done by one person for another is done subject to the control and direction of the latter person as to the manner in which it is to be done the worker is a servant and not an independent contractor. If, however, the person doing the work agrees only to produce a given result but is not subject to control in the actual execution of the work he is an independent contractor." Where A and B at arms length and not in the course of A's trade of business, contemplate that B may perform some work for A for the purpose only of ascertaining and demonstrating B's fitness and ability to do a contemplated task, and assuming A does not direct or control the work, there will be no contract of service, no relationship of master and servant during that trial. The fact that incidentally A may benefit (because his property is utilised during the trial), the fact that A may have agreed to pay expenses, or supply materials or pay a modest sum per hour, the fact that it is possible that a contract for work to be done will eventuate should the trial be successful will not alter the relationship. Where the parties stand in a relationship where A is endéavouring to help B in a benevolent sense the master and servant argument is even more tenuous. So assuming, as counsel assumed, the evidence established a contractual relationship at all it was not in my view a contract of service. It imposed absolutely no express or implied obligations upon the respondent relating to the ~-10- quality of his work. The only obligation imposed was upon the appellant to pay $2 per hour in respect of the respondent's work upon the trial - however inadequate or successful his efforts proved. In Consolidated Press Ltd. v. Thompson (1952) 52 S.R. (W.S.W.) 75 at 79 Street CJ. in referring to a contract of service stated - "The Court was referred to many authorities dealing with the relationship of master and servant, and I do not think it is necessary to discuss many of these at length. 'Decisions are valuable for the purpose of ascertaining a rule of law...but it is , an endless and unprofitable task to compare the details of one case with the details of another in order to establish that the conclusion from the evidence in the one must be adopted in the other also. Given the rule of law, the facts of each case must be independently considered, in order to see whether they bring it within the rule or not' (per Lord Loreburn L.C. in M'Cartan v. Belfast Harbour Commissioners (1911) 2 Ir. Rep. 143 at 145. So far as this specific argument is concerned, I think the rule of law applicable has been clearly stated and is not open to question. The relation- ship of master and servant arises out of agreement and the general principles of the law of contract apply in considering the respective rights and obligations of employee and employer under a contract of service. There are incidents of a special nature attached to this type of contract by reason of the nature of the subject matter and the personal obligation resting upon the employee to serve and obey the employer, and upon the employer to pay for the services so rendered and to carry out any other obligations which he has assumed towards his employee." Can it be said here that this preliminary arrangement contained such elements of a contract of service? A working arrangement which would enable the respondent to work pretty much as he wished was contemplated but it was conditional upon his proved ability to do the job, albeit at his own convenience. If he found he could not do that work, that, upon the evidence, was the end of the matter. The circumstances here, are to be '-1l- distinguished from the class of case where an unconditional agreement has been entered into but the worker suffers injury before actually embarking on his work, where for instance he may suffer injury on the way to work, or at his employer's premises before he starts his work. See R. & M. Johns Bros. Pty. Ltd. v. Francis (1956) V.L.R. at 404, There Smith J. who gave the judgment of the court said, referring to the equivalent Victorian Act - "The scheme of the legislation is, we think, to use the widest and most comprehensive language in the definition of "worker" so as to bring ? within the scope of the Act all persons who have "entered into" contracts to do work otherwise than as independent contractors, and to leave the task of defining the stage at which the risk of the other contracting party commences to other provisions, namely the conditions as to the course of employment and as to other matters....." Denning L.J. stated in Courtney & Fairbairn Ltd. v. Talaini Bros. (Hotels) Ltd. & Another (1975) 1 All E.R. 297 at 301 '- "If the law does net recognise a contract to enter into a contract (when there is a fundamental term yet to be agreed) it seems to me it cannot recognise a contract to negotiate. The reason is because it is too uncertain to have any binding force. No court could estimate the damages because no one can tell whether the negotiations would be successful or would fall through: or if successful, what the result would be. It seems to me that a contract to negotiate, like a contract to enter into a" contract, is not a contract known to the law." In that case the Court of Appeal disapproved the dictum of Lord Wright in Hillas & Co. Ltd. v. Arcas Ltd. (1932) 147 L.T. 503, which suggested that a contract to negotiate accompanied by good consideration may be a contract enforce- able at law. There are of course cases where the law regards an agreement as enforceable although some important features may not have been agreed (Perry v. Suffields Ltd, ~12- (1916) 2 CH. 187), but the law will not regard as binding an arrangement which does not indicate agreement as to fundamental terms. It follows that when the parties are contemplating an agreement pursuant to which one intends to supply his skill and labour to another for reward, the physical capacity to do the work must be fundamental to the proposed bargain. It is trite to say that when that capacity is in the minds of the parties in doubt, until that doubt is removed there may be no bargain in the form of a contract of service or a contract for service. > In Foley v. Classique Coaches Ltd. (1934) 2 K.B. 1 at p.13 Maugham L.J. stated - "It is indisputable that unless all the material terms of the contract are agreed there is no binding obligation. An agreement to agree in the future is not a contract; nor is there a contract if a material term is neither settled nor implied by law and the document contains no machinery for ascertaining it." Lord Buckmaster's observations in May & Butcher Limited v. The King which appears as a note to Foley v. Classique Coaches Ltd. (supra) but which was determined in 1929 were to the same effect. "In my opinion there never was a concluded contract between the parties. It has long been a well recognised principle of contract law that an agree- ment between two parties to enter into an agreement in which some critical part of the contract matter is left undetermined is no contract at all. It is of course perfectly possible for two people to contract that they will sign a document which contains all the relevant terms, but it is not open to them to agree that they will in the future It is perhaps convenient to return to basic principles. agree upon a matter which is vital to the arrangement between them and has not yet been determined." Viscount Dunedin there observed - -13- "To be a good contract there must be a concluded bargain, and a concluded contract is one which settles everything that is necessary to be settled and leaves nothing to be settled by agreement between the parties." In Humberstone's Case (supra) Dixon J. observed "The essence of a contract of service is the supply of the work and skill of a man." When ability to work or to exercise skill is mutually in doubt a contract of service is likely to be contingent upon resolution of such uncertainty. These cases merely illustrate how inept it may be to classify the relationship of the appellant and the respondent in this case as being pursuant to a contract of either type. How can -there be a contract of service, when both the parties who contemplate some such relationship have agreed there should be a trial to ascertain whether one as a physically handicapped individual has indeed the capacity or skill to do the work contemplated? As I have said the evidence and the events which followed explain why the parties thought a trial was necessary before they entered into a working relationship. Having carefully read the transcript it seems to me that there is no doubt that both the parties accepted the concept that the respondent was on trial. The respondent agreed this to be the "real arrangement". Q. . "If after the trial it was seen that you were capable of painting the house then you expected to work out an arrangement with Mr Dare?" A. "That's right. I would have waited until he'd seen the fact that I was able, yes." The offer the appellant made to pay the respondent $2 an hour during the trial period played no part in the respondent's ~14~ agreement to such trial, and in fact, he could not recall that part of the arrangement. That offer was made basically because the appellant felt a sense of embarrassment at the appellant's condition. As I have said it is apparent that if the respondent had not offered to pay that sum there could be no suggestion of a contract of any type. In these circumstances I do not consider this offer of payment assumes the legal significance one would normally attach to a simple contract which expressly or impliedly incorporated agreement as to remuneration to be paid for work and labour done. The burden rested upon the respondent to establish a contract of service. All that was proved was an offer whereby the appellant was given the opportunity of testing or proving his ability as a house painter with the appellant's materials, upon the appellant's house. , This offer, accepted by the respondent when he embarked upon the trial, did not as I have said, place any obligations upon the respondent to work for the appellant in any capacity, the sole obligation imposed was upon the appellant to pay the respondent what was due upon completion of the trial and this in itself was independent of the outcome of the trial. I have considered whether the agreement could be reasonably interpreted as a contract of service conditional only as to adjustment of wages after the trial period. But the evidence does not support a finding that the agreement was in the form of a wage fixing exercise and there was no mutuality of obligation. The trial went to the root of the Matter, that is to say as to whether or not the parties would enter a contract of service or a contract for services in the ~15- future. When he suffered injury the respondent was not working under a contract of service with the appellant and he was not entitled to compensation under the provisions of the Ordinance. I would allow the appeal and restore the order of the Tribunal dismissing the Application. The order of the Court will be that the appeal be allowed, the order of the Supreme Court of the Northern Territory be set aside 'and the orders of the Tribunal, including the order that the respondent pay the appellant's costs of the proceedings before the Tribunal, be restored. The respondent must also pay the appellant's costs of the proceedings before the Supreme Court and this Court. IN THE FEDBRAL COURT OF AUSTRALIA NORTHERN TERRITORY DISTRICT REGISTRY No. NTG 8 of 1978 rs GENERAL DIVISION ON APPEAL FROM THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA BETWEEN: JOHN DARE Appellant (Respondent) AND: WILLIAM EDMUND DIETRICH Respondent (Appellant) CORAM: Muirhead, Deane and Lockhart JJ. 21 AUGUST 1979. REASONS FOR JUDGMENT DEANE J: On 15 September, 1975 William Edmund Dietrich ("the respondent") took up residence at Griffith House Hostel in Alice Springs. At the time, he was suffering from at least the incipient stages of Huntington's Chorea. Mr. Wylie, who was the manager of the Hostel, described him as "a person who was shakey or twisty, shoulders moving and general inability to keep still". In addition, the respondent informed Mr. Wylie that he had a problem with alcohol. The respondent also informed re a ee Se RE EP ERR FOR NR CA NT AE STE ENA OP AO rte y= att eae ty Mr. Wylie "that he had not got work, he'd like to get some sort of work and see if he could wp-grade his circumstances". The appellant, John Dare, had been known to Mr. Wylie for some years prior to October, 1975. He had been associated with the Chamber of Commerce in Alice Springs and, on occasion, had assisted Mr. Wylie in finding employment for unemploved persons staying at Griffith House Hostel. Shortly before 15 October, 1975, Mr. Wylie raised the respondent's predicament with the appellant and subsequently introduced the respondent to him. Mr. Wylie informed the respondent that the appellant might be able to help him find some form of employment. The possibility of the appellant's engaging the respondent to paint the exterior of his home was discussed. The parties inspected the appellant's house where any painting work was to be done. There was some discussion about the size of the job and the respondent's capacity to do it, the materials that would be needed, the fact that the appellant would have to provide those materials and the basis of payment. The respondent said that he would "give it a go". It was arranged between the appellant and the respondent that they would have a trial to determine the respondent's capacity to do the job. The appellant told the respondent that he would pay him $2.00 per hour until "we see how you go". The appellant was, through- out, motivated by a desire to assist the respondent rather than any real wish to have his house painted. On the morning of 15 October, 1975, the respondent arrived at the appellant's home. The appellant authorized him to commence the painting worx. Shortly afterwards, the respondent mounted a ladder. The ladder toppled over. 'The respondent grabbed for the eaves of the house and hung from them for some short time. Eventually he fell to the ground. He suffered severe fractures of his right shoulder and right leg. Section 25 of the Northern Territory Workman's Compensation Ordinance 1949 ("the Ordinance") provides, for present purposes, that proceedings for the recovery of ccmpen- sation under the Ordinance shall not be maintainable unless the claim for compensation has been made within six months after the occurrence of the injury. The section contains a proviso to the effect that a failure to make a claim within the six months' period shall not be a bar to the maintenance of proceed- ings if it be found that the failure was occasioned by, inter alia, mistake or other reasonable cause. The respondent made no claim against the appellant for compensation within the specif- ied period of six months after the occurrence of his injuries. He stated, in evidence, that his "only reason" for refraining from making such a claim was that he ""knew'' the appellant "wouldn't have any worker's compensation policy". After the expiry of the six months' period, the respondent made such a claim against the appellant. The claim for compensation having been refused by the appellant, the respondent commenced proceed- ings for compensation in the Workmen's Compensation Tribunal. The respondent's claim, as particularized, was for compensation in respect of injuries sustained in the course of work as a painter employed by the appellant. The appellant, by his answer IP EET YEE BY LS TET TE PRE OTE ny SU PTE A= Oe CE ON TTY nt re eee ee parted see Fe ad net put in issue a number of matters. Those matters, to the extent to which they remain of relevance, may be summarized as being that the claim was not made within six months after the occurr- ence of the respondent's injuries and that the respondent was not, in any event, a workman within the meaning of the Ordinance and therefore had no entitlement to compensation. The matter came on for hearing before the Workmen's Compensation Tribunal. The parties were represented and oral evidence of a number of witnesses, including the appellant and the respondent, was led before the Tribunal. The Tribunal held that the respondent was not, at the time he sustained his injuries, a workman within the meaning of the Ordinance and was therefore not entitled to compensation undez the Ordinance. In the light of that finding, the Tribunal found it unnecessary to make any finding in respect of the respondent's failure to make a claim within the time specified in s.25 of the Ordinance. The respondent appealed from the Tribunal's decision to the Supreme Court of the Northern Territory. At the commencement of the proceedings before the Supreme Court, a question arose as to whether the respondent, as appellant in the Supreme Court, was entitled to call further evidence. The learned judge ruled that the proceedings before him were by way of a hearing de novo and that the respondent was entitled to present his case for compensation afresh on new or additional evidence. The matter proceeded before the Supreme Court on that basis. The evidence before the Tribunal was tendered and admitted into evidence and both parties supplemented their evidence before the Tribunal by additional evidence. The Supreme Court upheld the responéent's appeal and made an order for compensation in the respondent's favour against the appellant. His Honour held that the resporient was, at the time he sustained his injuries, a workman within the meaning of the Ordinance and that his failure t> make a claim for compensation within the time specified in s.25 of the Ordinance did not constitute a bar to an award c= compensation being made in his favour for the reason that it was occasioned by mistake or other reasonable cause. The appellant appeals to this Court from that decision of the Supreme Cource of the Northern Territory. The appellant advanced two independent rrounds of attack upon the decision of the Supreme Court in the respondent's favour. First, it was said, his Honour was misctzken in ruling that the proceedings before him were by way of M=aring de novo and that the respondent was entitled to call fresh evidence. It was, it was said, only on the basis of the ===sh evidence admitted on the hearing before the Supreme Cour= that his Honour's finding that the failure to make a claim within the period specified by s.25 of the Ordinance was accasioned by mistake or other reasonable cause could be justicied. Second, it was submitted that his Honour's finding that =he respondent was, at the time he sustained his injuries, a wamkman for the purposes of the Ordinance was erroneous. In the svent that the learned Judge was not in error in admitting =he further evidence, it is conceded that his finding that =:2 failure to make the claim within the specified period of tx=t:s was occasioned by mistake or other reasonable cause is not otherwise open to attack. It is not contended that, if the respondent was entitled to an award of compensation, the order for compensat- ion made was unduly favourable. THE NATURE OF THE HEARING BEFORE THE SUPREME COURT The appeal to the Supreme Court was, as has been mentioned, brought pursuant to the provisions of s.26 of the Ordinance. That section provides, for present purposes, that an appeal may be on a question of law or fact or both and "may be in the nature of a re-hearing". The provision that the appeal "may be in the nature of a re-hearing", like many other provisions of the Ordinance, was based on the provisions of the Commonwealth Employecs' Compensation Act 1930 which, in s.20, used identical words in relation to an appeal from the Commissioner under that Act to a County Court. In Phillips v. The Commonwealth ((1964) 110 C.L.R. 347), the effect of the provisions of s.20 of the Commonweaith Employees' Compensation Act 1930 was considered by the Full Court of the High Court of Australia. Their Honours said (ibid, at p. 350): " The appeal to the County Court was brought pursuant to s.20(t) of the Aet which provides that: "Any person affected by any determination or action of the Commisstoner under this Act may appeal toa County Court against the determinatton or action and the Court shall have jurisdtetion to hear and determine the appeal, and such appeal may be in the nature of a re-hearing". The use of the word "may" in the econeluding words of the sub-seetton ts some- vhat curtous but tt ts elear enough that the form of proceedings for which the sub-seetton provides ts not 2 Cr pe tte eee 8 tr mere ap A en ree pee oat SIs toe allnemne n memesnoes bene alee cme ees a an appeal in the striet sense at all. Waat the section does ts to provide for the judtetal review of administrative decisions of a particutcr character and upon any such review it ts, we think, for the Court to pronounce anew upon the rights cr the parttes as disclosed by the evidence before it. That being so the application of the ordinary prineizvles relat- tng to the determination of disputed ques sions of fact by judietal trtbunals requires the esneluston that tf a elatm for compensatton be rejezted by the Commtsstoner or his delegate the onus of proving the necessary facts to entitle the applieant to what is virtually an award of compensation witl be upon the claimant in later proceedings before sne County Court". wo mG x Plainly, it was their Honours' view that the "appeal" referred to in the section was in the nature of a hearing dz novo (see, also, Builders Licensing Board v. Sperway Constructions (Syd) Pty. Limited §& Anor. (1976) 135 C.L.R. 616 at p. 621). In The Commonwealth v. Rutledge ((1964) 111 C.L.R. 1 at p. 8) Taylor J. said of s.20 of the Act: "The so-called appeal for which s.20 provises is, in my view intended as a vehtele by whitch, t+ the case of claims for compensatton which have beex deter- mined adversely to an applteant, such elains may be earrted to a County Court for rehearing and deter- minatton. Further, in disposing of any su2h appeal that court may determine any tissue arisine | in relat- ton to the elaim just as the Commissioner might have done tn the first instance". Menzies J. (ibid at p. 12) and Owen J. (ibid at p. 15) expressed their agreement with Taylor J. on that aspect of the case, It was submitted on behalf of the appellant that, notwithstanding the similarity in the wording of the two sections, ', the nature of the appeal for which s.26 of the Ordinance makes provision is quite different from that which was established by s.20 of the Act. Reference was made to the decision of the High Court in Builders Lacensing Board v. Sperway Constructions ! (Syd.) Pty. Limited § Anor (supra) which establishes that a statement that an appeal is by way of re-~hearing is not, in itself, necessarily determinative of the question whether the re-hearing is a hearing de novo as distinct from a re-hearing on the record: that question is to be determined by the elicitat- ion of the relevant legislative intent from the overall statutory provisions establishing or regulating the appeal. The function performed by the Workmen's Compensation Tribunal and the procedure adopted by that Tribunal in the performance of that function were, it was submitted on behalf of the appellant, such as to warrant the conclusion that the relevant legislative intent was that the appeal established by s.26 of the Ordinance was not to be a hearing de novo and that, in particular, the only fresh evidence which the Supreme Court was entitled to receive on the hearing of such an appeal was evidence bringing the material before the Tribunal up to date. One difficulty which lies in the path of the appellant's argument is that the Workmen's Compensation Tribunal whose functions and procedure form the basis of the appellant's argu- ment as to the construction of s.26 of the Ordinance was only established in 1969. The amendments made to the Ordinance (and, in particular, to s.26 thereof) in relation to the establishment of the Tribunal did not include any amendments apparently intended to alter the nature of the appeal established by s.26 of the Ordinance or to overcome the effect of the statements in Phillips' Case (supra) and Rutledge's Case (supra) which would appear to be otherwise prima facie applicable to the appeal which the section had established. Quite apart from that difficulty, I am not persuaded that consideration of the function and procedure of the Workmen's Compensation Tribunal leads to the conclusion that the appeal established by s.26 of the Ordinance was intended to take a different form to the appeal established by the section of the Commonwealth Act upon which s.26 of the Ordinance was plainly based. In Builders Licensing Board v. Sperway Constructions (Syd.) Pty. Limited 4 Anor. (supra) at p. 621 Mason J. (with whose judgment Barwick C.J., and Stephen J. agreed) stated that where a right of appeal is given to a court from a decision of an administrative authority, a provision that the appeal is to be by way of re-hearing generally means that the court will undertake a hearing de novo. His Honour continued: "There are, of course, sound reasons for thinking that in many cases an appeal to a court from an administrative authority wtll necessarily entail a hearing de novo ... the nature of the proceeding before the administrative authortty may be of such a character as to lead to the conelusion that itt was not tntended that the court was to be confined to the material before the authoricy. There may be no provision for a hearing at first tnstanee or for a record to be made of what takes place there. The authority may not be bound to apply the rules of evidence or the tssues which artse may be non-justictable. Again, the authority may not be required to furnish reasons for its decision. In atl these cases there may be ground for saying that an appeal calls for an exercise of original jurisdiction or for a hearing de novo". As Mason J. indicates, significant discrepancies between the judicisal process of a court and the nature end form of proceccd- ings before an administrative body will tend to confirm that a Le RRC TERY ee ears er ener cepa ttt bore 2 ease moors -10- provision for an appeal by way of re-hearing to a court from a decision/of that body calls for an exercise by the court of original jurisdiction and involves a hearing de novo. Section 6D of the Ordinance provides that, subject to the Ordinance, the Tribunal's procedure is within its own discretion, that the Tribunal will act without regard to technicalities and legal forms and that the Tribunal is not bound by the rules of evidence "but may inform itself on any matter in such manner as it thinks fit". These provisions make it clear that, while the Tribunal is, no doubt, under an obligation to act with judicial detachment and fairness, the proceedings before the Tribunal are not governed by the ordinary principles relating to the determination of disputed questions of fact by a judicial tribunal. They confirm that the appeal to the Supreme Court from a decision of the Tribunal calls for an exercise of original jurisdiction by the Court and was intended, where disputed questions of fact are involved, to provide for a judicial review, conducted in accordance with those ordinary principles, of the decision of the Tribunal. The statement in s.26 of the Ordinance that "the appeal may be in the nature of a re-hearing" should not be construed in a narrow technical sense as meaning no more than that the appeal is to be determined as at the date of its hearing. The state- ment should be construed as conveying that the re-hearing may be a hearing de novo upon which it is for the Supreme Court to pronounce anew on the rights of the parties as disclosed by the evidence before it (see generally, Phillips' Case (supra)). ee ree teen ter ree ne eg we ee -11- As the use of the word "may" indicates, this does not mean that it will be necessary or desirable in every case for the parties to present their evidence afresh to the Supreme Court so that the appeal may be a re-hearing de novo in every sense. Where questions of law or inferences from undisputed facts are involved, it may well be both convenient and appropriate for the evidence before the Supreme Court to consist of the record (if there be one) of proceedings before the Tribunal. It follows that the respondent was entitled to adduce new evidence on the hearing of the appeal to the Supreme Court and that the learned judge was not in error in admitting such fresh evidence or taking it into account in his decision. I note that my conclusion in that regard accords with previous statements both in this Court and in the Supreme Court of the Northern Territory. (Connair Pty. Limited v. Frederiksen (1977) 16 A.L.R. 148 at p. 149 (Muirhead J.) and, on appeal, (1978) 20 A.L.R. 579 at pp. 581, 592 and 605; McMahon Constructions Pty. Limited v. Bonetti, 17 October, 1978, unreported: Supreme Court of the Northern Territory (Forster C.J.)). WAS THE RESPONDENT ENTITLED TO COMPENSATION UNDER THE PROVISIONS OF THE ORDINANCE Section 7 of the Ordinance provides that, if personal injury by accident arising out of or in the course of his employment by his employer is caused to a workman, his employer shall, subject to the Ordinance, be liable to pay compensation. Subject to certain presently irrelevant exceptions and to a contrary intention, "workman" is defined, by s.6 of the -~12- Ordinance, as meaning: | "any person who has entered into or works under a contraet of service or apprenticeship with an employer, whether by way of manual labour, elerteal work or otherwise, and whether the contract ts express or implied, or ts oral or in writing". It is common ground between the parties that there was a contract between the appellant and the respondent. The issue between them is whether that contract was "a contract of service" between the appellant as employer and the respondent as employee. If it were such a contract, the respondent was entitled to compensation under the Ordinance. If it were not, he was not so entitled. In a case, such as the present, where it is common ground between the parties that there was a contract, the judicial determination of whether that contract was a contract of service will commonly resolve itself into the traditional choice between a contract of service and a contract for services. If, in the present case, the contractual relationship between the parties had extended beyond a period of trial to embrace the task of painting the appellant's home, the resolution of the question whether there was or was not a contract of service would have depended upon such a choice. The Workmen's Compensation Tribunal, before which all of the evidence relevant to this aspect of the matter was led, reached the conclusion, however, that any contractual relationship between the parties did not extend beyond the trial period. Examination of the evidence discloses that there was no real dispute between the parties on that point and that the Tribunal's conclusion in that regard -13- - was plainly correct. The evidence also makes clear that the terms of, any future contract for the performance by the i : respondent of the overall painting task were left for negotiat- ion or arrangement after the completion of the trial. The respondent gave evidence: "OQ. ... You told us earlier what you said was, "I think so". Were you not on trtat as to whether or not you could paint Mr. Dare's house? Was not that the real arrangement between you? A. Yes. Q@. If after the trial it was seen that you were capable of painting the house then you expected to work out an arrangement with Mr. Dare? A. What's right. I would have watted until ne'd seen the fact that I was able; yes". To like effect was the evidence of the appellant: "Tl said to Mr, Dietrich that I would pay him $2 an hour inittally. This is below the accepted rate for a carpenter (semble, painter) but I took into aecount his econdttton. I was a bit embarrassed about speaking to him directly about his condition, but I said, "Welt, took, I'tl pay you thts for a starter and see how you go and then we'll talk about tt later on". He said, "Yes, that's o.k.". He aceepted the facet that we both had to judge how he could handle the job". As to the expected length of the trial period, the appellant's evidence was: "Q. Well, tf thts - as you are atleging - was a trial, when did you expect the trial would finish? A. I would have imagined that between the two of us we would have seen what he was able to do within a@ couple of hours anyway. @. It coutd have been a day too? A. I think I would have classed myself as able to u eect a ee to judge a workman's ability in less time than that and I think Mr. Dietrich woutd have known htmsetf / also in tess time than that as to whether he was capable of handling the job". It is conceivable that, if the appellant had been sat- isfied as to the respondent's capability, he may have engaged him to paint his house, at times which suited the respondent, for a fixed fee for both labour and materials and upon terms which made it clear that the respondent was engaged not as an employee under a contract of service but as an independent contractor under a contract for services. It is at least equally conceivable that, if the appellant had been so satisfied, any contractual arrangements reached as regards the overall task would have established the relationship of master and servant between the parties. It is, in the circumstances, impossible to do more than speculate as to which of the two alternative types of contract would have resulted if the matter had proceeded to an ultimate contractual relationship extending beyond the trial period. The matter not having proceeded beyond the trial state, the relevant question is whether, even at the trial stage when the respondent sustained his injuries, the respondent was employed by the appellant under a contract of service. The determination of that question does not necessarily involve a choice between alternatives of contract of service and contract for services. A third possibility exists, namely, that any contract between the appellant and the respondent in relation to the period of the trial came within neither category. The trial which the appellant and the respondent arranged was plainly in the interests of them both. From the . -15- appellant's point of view, it was to enable him to assess the respondent's capacity and to decide whether he would engage the responcent to paint his house. From the respondent's point of view, it would likewise serve to determine whether he was capable of undertaking the task and, if he were, to provide him with the opportunity of being engaged to perform it. Were it not for the appellant's undertaking to pay the respondent $2.00 per hour for the period of the trial, it would, in my view, be apparent that the arrangements for the trial were not intended to be, and were not, binding in contract upon either appellant or respondent. The period of the trial could not properly be seen as a period in which the respondent would be doing painting work for the benefit of the appellant. If the result of the trial had been to demonstrate the respondent's inability properly to paint, the result of the respondent's activities during the period of the trial could well have been a cause of either embarr- assment or further expense to the appellant. The trial was to enable the parties to determine whether they would enter into contractual arrangements for the painting by the respondent of the appellant's house. The charitable motivation of the appellant and the fact that the content of any contractual arrangements which might eventuate was left for further negotiation lend support for the conclusion that, in the absence of the promise as to payment, the arrangements for the trial would not have been intended to be, and would not have been, binding in contract. Apart from the promise as to payment, the arrangements for the trial, in the present case, have much in common with the arrangements for the ordinary interview or test in which a potential employer discusses or observes the qualifications and talents of a potential employee or independent contractor. In -16- such a case, if the potential employer undertakes to applicants that he will pay them for the time which their interview or test takes, he will, prima facie, be under a contractual Lia- bility to make the promised payment after his offer has been accepted by attendance for, and genuine participation in, the interview or test. It does not however follow, in such a case, that the contract imposes executory contractual obligat- ions upon the applicant or transforms the applicant into an employee of, or independent contractor obliged to perform work for, the prospective employer regardless of the cutcome of the interview or test. The question which lies at the heart of the issue presently under consideration is whether the contract arising from the acceptance of the appellant's undertaking to make the payment transformed the arrangement in the present case from a trial to determine whether the parties would enter into a contract in relation to the painting of the house into an executory contract under which the respondent was bound to perform work for the appellant as an employee or as an independ- ent contractor. In my view, it did not. As I see the matter, the appellant's undertaking to pay the respondent $2.00 per hour for the period of the test was an offer to enter into a unilateral contract. That offer was accepted by the respondent when he attended at the appellant's home and embarked on the test. The resulting contract was never executory in so far as the respondent was concerned. Up until the time when he embarked upon the trial, he remained free to change his mind and to refuse to participate in it. Once he embarked upon the trial he was free, at any time, to dis- ee ee ee -17- continue. During the period of the trial, he was under no contracthial obligation to the appellant to perform in a workmanlike manner any painting work which might be involved. one of the purposes of the trial was 10 determine his ability so to do painting work. The consequence of his refusing to participate in the trial or participating in it other than genuinely would have been that the appellant did not become contractually liable to make the payment which he had offered to make. Such refusal or such lack of genuine participation would, however, no more have involved breach of contract on the respondent's part than would returning home or loitering on the way have involved breach of contract on the part of the mythical walker who was offered £100.0.0 to walk from London to York. A contract of service is that form of contract which embodies the social relationship of employer and employee. It cannot be identified by reference to the presence of any one or more static characteristics. The relationship is a dynamic one which needs to be accommodated to a variety of different and changing social and economic circumstances. It is, however, of the essence of a contract of service that it is a bilaterai contract involving executory obligations on behaif of both employer and employee (see, for example, Kearney v. Whitehaven Colliery Co. Limited [1893] 1 Q.B. 700 at p. 711). The contract which resulted from the respondent's acceptance by performance of the appellant's offer to make a unilateral contract was not such a bilateral contract. It did not extend beyond the appellant's obligation to pay the respondent for -~18- the period of the trial and did not give contractual force to the overall arrangements relating to the trial. In particular, that contract did not involve any contractually binding promise by the respondent to perform work for the appellant either in the capacity of an employee or in the capacity of an independent contractor. It did not involve the assumption by the respondent of anyexecutory obligations whatsoever. It was not a contract of service. It follows that, in my view, the respondent was not, at the time he sustained his injuries, a workman for the purposes of the Ordinance. It follows that the appellant was not liable, under the provisions of the Ordinance, to pay him compensation in respect of those injuries. I agree with the orders proposed by Muirhead J. J cortsy that this and the preceding pages are a true copy of the reasons for Judgment herein of His Honour Mr, Justice Deane. Tiare] Dthugest (VG poste: IN _ THE FEDERAL COURT OF AUSTRALTA NORTHERN TERRITORY DISTRICT REGISTRY } No. NTG 8 of 1978 GENERAL DIVISION | ON APPEAL FROM THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA BETWEEN: JOHN DARE Appellant (Respondent) AND: WILLIAM EDMUND DIETRICH Respondent (Appellant) CORAM: MUIRHEAD, DEANE AND LOCKHART JJ. 21 AUGUST, 1979 REASONS FOR JUDGMENT LOCKHART J: John Dare (the appellant) lives in Alice Springs. At all relevant times he was. the local honorary secretary of the Chamber of Commerce. As part of his voluntary work he helped unemployed and underprivileged persons find work. He knew Mr. Wylie, the manager of the Griffiths House Hostel in Alice Springs, which cared for a number of unemployed people. The appellant on occasions has helped Mr. Wylie fund employment -for unemployed people staying at the hostel. Walliam Edmund Dietrich ("the respondent") went to live at the hostel in September 1975. He was unemployed and had a problem wath alcohol. He was described by Mr. Wylie as "a person who was shaky or twisty, shoulders moving and general inab2zlaty to keep still." The respondent told Mr. Wylie that he wanted to "straighten himself out" and find some work to do. 20/2 2 mee reine epteteeenttiA S le eee ee ce ten = ee Shortly before 15 October 1975, Mr. Wylie spoke to the appellant about the respondent and later antroduced the respondent to him. Mr. Wylie told the respondent that the appellant might be able to help him find some work. There was a discussion between the appeilant and the respondent which led to the poss21bility of the respondent painting the outside of the appellant's home. The appellani did not really need this work done, but he wished to help the respondent improve his lot in life by finding something for him to do. They looked at the appellant's house to see what paintang was necessary to the outside. The respondent told the appellant that he had painted houses before when he was working as a builder. The respondent told the appellant the work that was needed and how it shouid be done. The respondent decided that the first task was to paint the eaves and gutters, then the walls. He asked the appellant to provide a wire brush to prepare the gutters for painting. The appellant asked the respondent what materials he needed. The respondent said that he wanted a ladder, brushes, paints, turps and certain other essentials. The appellant told the respondent that he had two ladders and that if the respondent preferred to work on a plank between them he could do so. The respondent said that he preferred to work standing on one ladder as he thought he would be steadier. They decided that the respondent would work for a -..f/3 mete ee awinenege ee eee Aeewes toreten 0 renee ae eer er pe ee ee rr eee ere ee er RE oe trial period to see if he could handle the job. The respondent said that, after his capability had been tested, he "expected to work out an arrangement." The appellant expected that the trial period would take only a matter of hours, as he would then be able to determine whether the respondent would be able to do the work of painting the outside of the house. After looking at the exterior the appellant asked the respondent if he thought he could handle the job. The respondent said: "I'm not sure, but I think so. I could'nt work all the time at it. I'd be governed by the heat of the day and can't work outside and that sort of thang." The appellant said: "Well, look, this is no worry to me. You can work what hours you like and whenever you like, as long as you like, it's not worrying me at all." It was not part of the arrangement between the parties that the appellant would remain at home to assist the respondent in his work, although in fact the appellant intended to remain home whilst the trial proceeded. As to remuneration, the respondent said: "YT would have been prepared to accept anything at all. The amount could have been $3.00 or it could have been $2.00 an hour, or it could have been less. I am sure that whatever John would have been able to pay would only have been what he could afford. I knew his finances were very poor al the moment." The appellant saad: "T said to Mr. Dietrich that I would pay him $2.00 an hour initially. This is below the accepted rate for a carpenter but I took anto account his condition. I . was a bit embarrassed about speaking to him directly about has condition, but I said, wee /4 ee ee tr re rg treet terrence sen eres whe Well, look, I'll pay you this for a starter and see how you go and then we'll talk about it later on.' He, / (i.e. the respondent) said, 'Yes, that's O.K.'. He accepted the fact that we both had to judge how he could handle the job." The respondent arrived at the appellant's home on the mornang of 15 October 1975. The materials were on the job. The respondent commenced work when he was ready to do so. Soon after that the respondent started to clamb the ladder which then toppled over. The respondent grabbed the caves of the house and hung suspended from them for a short time before falling to the ground. He suffered severe fractures of his right shoulder and right leg. Within minutes of the accident the appellant saw the respondent in his injured condition and arranged for him to be taken to hospital by ambulance. The respondent made a claim against the appellant for compensation under the Workman's Compensation Ordinance 1949 of the Northern Territory ("the Ordinance" ) in respect of the inguries sustained by him. The claim was denied by the appellant; whereupon the respondent commenced proceedings for compensation before the Workmen's Compensation Tribunal. By his answer the appellant put in issue various matters, only one of which remains relevant, namely whether * the respondent was a workman within the meaning of the Ordinance. The claim was heard by the Tribunal which held that the respondent was not, at the time he sustained his injuries, a workman within the meaning of the Ordinance and was eee f5 one cee tne ee ie ete ee et ete ee ee ty ek Le ere tere Beene oe therefore not entitled to compensation. The respondent appealed from that decision to the Supreme Court of the Northern Territory. Evidence before the Tribunal was tendered and admitted into evidence by the Supreme Court. Both parties gave additional evidence. The Supreme Court (Gallop J.) held that the respondent was a workman within the meaning of the Ordinance at the time he sustained his injuries, upheld the respondent's appeal and made arr order for compensation in favour of the respondent. The appeliant appeals to this Court from that decision. ~ The appellant attacks the decision of the Supreme Court on two grounds. Farst, the appellant contends that the Supreme Court was in error in holding that the proceedings before the court were by way of rehewing de novo and that the respondent was entitled to call fresh evidence. I have had the advantage of considering the reasons prepared in this matter by my brother Deane. I agree with what his Honour has said as to this ground. Accordingly this contention fails. Second, it is contended that the Supreme Court was in error in holding that, at the time he sustained his anjuries, the respondent was a workman within the meaning of the Ordinance. Section 6 (1) of the Ordinance, so far as relevant, defines a "workman" as meaning any person who has entered into or works under a contract of service with an employer, whether by way of manual labour, clerical work, or otherwise, and whether the contract 1s expressed or implied, or 1s oral or in writing. The question to be determined in this appeal is whether the respondent entered anto or worked under a contract of service with the appellant. Thas question generally arises where there is no dispute that there 1s a contract between the parties; but the issue 1s whether one partyis a servant of the other or an independent contractor. The distinction lies between what is conveniently called a contract of service and a contract for services. Convenient though they may be, juristic labels can be} deceptive as they tend to lead to the conclusion that the proper characterisation of a contract necessarily requires 2 choice between the labels, in this case between a contract of service or a contract for services. The facts of this case afford a good iallustration. It is agreed between the parties that there was a contract between them at the time the respondent was injured; but the determination of the true nature of that contract does not necessarily confine the choice to a contract of service or a contract for services. The contract may answer neither description. It may be a contract covering the period of trial, not fitting into either category. In support of his contention that there was a senior contract of service, Mr. Wyvill of/counsel for the respondent contended that the appellant was the respondent's paymaster; he could dismiss him; he could determine what materials were to be used by the respondent and the way in which he was to do the work. He relied, in particular, upon the -++/7 aE tg tte een heal ped ainh DAREMA gary DZ edie Fe | Dab nhs oh rows cee were an werent te arp pelea heen resent heare ee Ri fhe ad hated petal yt ie demaeasiadl he Ate fad anh decasion of the House of Lords in Mersey Docks and Harbour Board v. Coggins & Griffith (Laverpool) Limited 1947 A.C. 1. The court was referred to many reported cases; but it is clear from them that the question in each case is to be determined by ats own circumstances, decisions in other cases being illustrative rather than determinative, The question is answered by examining all the various elements which constitute the relationship between the parties. - Various tests have been applied in the reported cases in answer to the question whether a person works under a contract of service or is an independent contractor working under a contract for services. Sometimes one test proves to' be determinative, at other times the question is not easily resolved and various tests have been applied. The considerations which are relevant in determining the question cannot be exhaustively defined, nor can strict rules be established as to the relative weight to be attached to the particular tests in each case, In A.M.P. Society v. Chaplin & Anor. (1978) 18 A.L.R. 385, Lord Fraser, in delivering theopinion of the Judicial Committee, cited the following passage from the judement of Bray C.J. in that case at p. 387:- "It seems to me, then, that at the present time there is no magic touchstone. The court has to look at a number of indicia and then make up its mind anto which category the unstant case should be put. Tt is a question of balancing the indicia pro and con..But the power of control over the manner of doing the work is very important, 1.6/8 -8- perhaps the most important of such indicia." One of the considerations which has aided the courts in resolving the question is whether the person for whom the services are to be performed has power to direct what work 1s to be done, and how and where it is to be done, See Mersey Docks and Harbour Board v. Coggins & Griffith (Liverpool) Limited (supra); Queensland Station Pty. Limiied v. F.C. of T. (1945) 70 C.L.R. 539; Performing Rights Society Limited v. Mitchell and Booker (Palais De Danse) Limited 1924 1 K.B. 762; F. C. of T. v. J. Walter Thompson Aust.) Pty. Limited (1944) 69 C.L.R. 227 and Pollock on Torts - 15th Edition at pp. 61 and 62. Other considerations include the nature of the task undertaken, the power of dismissal and the magnitude of the amount of the contract. These may, in some cases, provide a useful guide as to the true nature of the relationship between the parties. See Performing Rights Society, Limited v. Mitchell and Booker (Palais De Danse) Limited (supra) It is necessary to examine all the facts of the relationship between the parties before determining whether or not a payment is wages in the ordinary sense of i remuneration for services rendered. The fact that a person may be engaged on the basis of being paid so much per hour or per day for his services does not prevent him from beang an independent contractor. See Williams v. H. V. Larsen Limited (1928) 21 B.W.C.C. 339. In Sadler v. Henlock (1855) 4 BE. & B. 570, Crompton J. said at p. 578:- "The test here 1s, whether the defendant retained the power of controlling the work. No distinction can be drawn from the «2/9 ~- - ee ee ee ee ee rrr en eet ee ce pee ne circumstance of the man being employed at so much a day or by the job." / An examination of 'the cases shows that many of the factors to be considered are often neutral. See Zoijs v. Wirth Bros. Pty. Limited (1955) 93 C.L.R. 561; F.C. of T. v. Barrett & Ors. (1973) 129 C.L.R. 395. The courts have not been ready to find a contract of service where the person, for whom work 1s done, acts out of benevolence or kindness rather than for commercial gain. See Burns v. Manchester & Salford Wesleyan Mission (1908) 99 L. T. 579; Kemp v. Lewis 1914 3 K.B. 543; Rogers v. Booth 1937 2 All E. R. 751; Liscoe v. Henry (1926) 19 B .WC. CG. 810. r The appellant engaged the respondent, essentially ' because he wanted to help the respondent who needed something to do to restore his confidence in himself and to improve his position. Neither of them knew if the respondent was physically capable of performing the task. So they arranged a trial period, not of any specific duration, but which the appellant thought would be a matter of hours, to assess the respondent's capacity. The very fact that the respondent was on trial reinforces what the evidence establishes to be the case, namely that the respondent was to determine the order and method of performance of the work. He determined the requisite materials for the job, although the appeilant purchased them, The respondent told the appellant that he had previously gained painting experience in the building industry. The appellant relied on that. As to remuneration, the respondent was happy to accept anything at all. The appellant thought it appropriate to give him §2.00 per hour. - - -- -—— -~ ~ — ~ aml _ --- noe me F ~10- If the respondent performed satisfactorily during the trial, doubtless the parties would have come to a suitable arrangement as to the painting of the house; but the precise terms of that arrangement, if any, fell to be finally determaned later. For these reasons, 1n my opinion there is no contract of service in the present case. Although the hearing before the Supreme Court was by way of rehearing de novo and fresh evidence was led by both parties, none of that evidence touched the question of the nature of the relationship between the parties. The evidence was directed to other issues which were not raised before this court. For these reasons, in my opinion the appeal should be allowed, the order of the Supreme Court set aside and the order of the Trabunal restored. The respondent should pay the appellant's costs of the proceedings before the Tribunal, the Supreme Court and this court. fir. Juchco bos, ays woe ' " Pe ee ee ee ee ee ee nen