PETKOVIC v LEHMAN BROTHERS PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL SAMUELS AP, CLARKE and HANDLEY JJA 14 October 1991, 14 October 1991 [1991] NSWCA 223 WORKERS COMPENSATION — WORKER DEEMED WORKER — WORKERS COMPENSATION ACT, 1926, S6(3A) — REASONS — NO ERROR OF LAW Clarke JA The parties in this case submitted a preliminary question for determination by Judge Coleman. That question was in these terms, "Whether or not the applicant was a worker or a deemed worker within the meaning of the Act". Judge Coleman determined that question adversely to the worker, who is the appellant in this Court, and as a consequence made an award for the respondent. The appellant lodged a notice of appeal which, in its amended form, challenged the finding that the appellant had not shown himself to be a worker and additionally challenged the finding that the appellant had not shown himself to be a deemed worker. When the appeal commenced counsel for the appellant, Mr Ryan, advised the Court that the challenge against the finding that the appellant had failed to establish that he was a worker was no longer pressed. Accordingly, it was accepted that it had been open to Judge Coleman to find that the appellant had not established that he was a worker and it was also accepted that that finding was not vitiated by legal error. The submission which was made was that the adverse finding on the deemed worker issue was affected by two legal errors, the first being that the trial judge had failed to give reasons demonstrating how he had reached his conclusion; the second, which assumed an answer adverse to the appellant on the first question, asserted that the trial judge had misdirected himself as to the applicable law. In this respect it was submitted that the trial judge reasoned to his conclusion simply upon the basis that he had determined that the appellant was an independent contractor at the relevant time. This it was said was a clear error because whether or not a person was a deemed worker depended upon the application of the test appearing in s6(3A) of the Workers Compensation Act, 1986, and this section contained a number of elements only one of which was that the worker was an independent contractor. The appellant had migrated to Australia from Yugoslavia in 1970. Shortly after his arrival in this country he commenced employment with the respondent and he continued in that employment until he returned to Yugoslavia for three months holiday in 1977. When he arrived back in Australia he resumed work with the respondent, but after a short time commenced working on his own account on private jobs as and when they arose. Both in his private work and in his work for the respondent he worked as a tiler. The arrangement which seems to have operated, or which his Honour considered seemed to have operated, was that whenever he was short of work he would ring the respondent who would provide some work for him and whenever 2 UNREPORTED JUDGMENTS the respondent was short of employees it would ring him and engage his services for some time. The appellant estimated that prior to September 1984 he worked about half his working time for the respondent and half on his private contracting work. In September 1984 the appellant returned to Yugoslavia because of his father's illness and he was away for five weeks. He arrived back in Australia in about the middle of October 1984 and shortly after he arrived back he spoke to an officer of the respondent and secured some work from him. Between that time and 18 December when he was injured he worked for the respondent and for no one else. However, according to his Honour's findings, the arrangement by which he worked for the respondent and was paid by it, which had been in force prior to his holiday in September-October 1984, continued after he had returned to Australia. He was not thereafter employed in the strict sense of the word by the respondent nor was there any change made to his manner of working nor the system by which he was paid. The primary issue at the trial, as we were informed by Mr Ryan, was whether the appellant was a worker. This issue was, as I earlier indicated, determined against the appellant. In deciding it, Judge Coleman indicated in his judgment that he had had regard to the leading cases upon the question and had concluded on the balance of probabilities that the appellant was an independent contractor. The reasons which persuaded him to that conclusion were shortly as follows: "The appellant paid his own taxation. He was not subjected to any real control in the performance of his work by the respondent. He had freedom of choice as to when he would commence his work. He had taken out and maintained a sickness and accident policy, and he held himself out as a tiler in the telephone book directory". I would interpolate here the observation that there was an entry in both the white pages and the yellow pages concerning the appellant's business as a tiler. For those reasons, Judge Coleman concluded that the appellant failed to show that he was at the relevant time a worker. This finding is, as I have said, not challenged. His Honour, however, did not, and I think this probably is a reflection of the manner in which the case was fought at first instance, deal at length with the alternative claim under s6(3A) of the Workers Compensation Act, 1986. What his Honour said was that he was satisfied that the appellant was an independent contractor and not a worker or deemed worker within the meaning of the Act. He had said before making that finding that the appellant had his name listed as a tiler in the white and yellow pages of the Sydney telephone directory and subsequent to his finding he indicated that that had been a relevant factor in his determination adverse to the appellant. It would seem to me from the judgment to be reasonably simple to discern the manner in which his Honour reasoned to his conclusion. The appellant was at the relevant time an independent contractor. He held himself out to be a tiler and had prior to September 1984 regularly carried on business as a tiler in his own name. The fact he continued as an independent contractor, in all the circumstances, led his Honour to conclude that his pattern of working both for himself and for the respondent prior to his departure for Yugoslavia in September 1984 had not altered after his return in October 1984. URJ PETKOVIC v LEHMAN BROTHERS PTY LTD (Samuels JA) 3 Ina sense this finding may have involved the implicit rejection of a suggestion, and I don't think it was more than that, put forward by the appellant that he would not have worked for anyone else after he returned to Australia in October 1984. That suggestion depended upon his answer no to a question which read: "Did you approach anyone else for work at all after you returned to Australia?" and his explanation for that answer which was: "Because I was always secure with them. I always believed they will give me job and they don't when I told them". That evidence, however, goes no further than establishing that, rather like the situation had been in 1977, he hadn't approached anyone else for work immediately upon his return and before Christmas and the reason he had not done that was because he felt secure with the respondent. The evidences does not, however, establish that he was unwilling to take work as he had taken it prior to September 1984 nor is there any suggestion in the evidence that he had taken any steps to ensure that his name was not listed in the future as a tiler in the telephone book or to ensure that people became aware that he was no longer doing work privately. In summary the evidence, which really went to the issue of worker and not deemed worker, established that he had only worked for the respondent in the two month period since his return from Yugoslavia and that he had not approached anyone else for work because he was secure with the respondent. What I think is clear from his Honour's finding that the appellant's pattern of work did not change after September 1984 is that he continued his tiling business on his return to Australia. If Lam right to think that his Honour's reasoning process was that the appellant was not only an independent contractor, but was carrying out his work for the respondent incidentally to his trade as a tiler regularly carried on by him in his own name, then the argument that there was no reasons exposed in the judgment fails. Although I would accept the proposition that his Honour did not spell this out in graphic terms, I think the conclusion I have reached emerges reasonably clearly from all that his Honour said. Once his Honour concluded, as I think he did, that the appellant was working for the respondent as he had prior to September 1984 incidentally to his trade as a tiler and that that trade had been regularly carried on by him, then I do not think that the judgment discloses or is inadequate insofar as it fails to disclose the reasoning process. The alternative point was that his Honour must have concluded that the appellant was not a deemed worker simply because he was an independent contractor. This conclusion would be a surprising one for a judge as experienced as Judge Coleman, particularly as his Honour posed the question accurately and answered the question properly in his judgment, but I do not think I need say any more about the proposition than that the conclusion I have reached on his Honour's reasoning, as I understand it, involves a rejection of the fundamental basis upon which the argument depends. In my view, it was quite wrong to suggest that his Honour concluded against the appellant on the deemed worker issue simply because he was an independent contractor. I think it was clear that he did so in light of all the circumstances in the case and particularly his conclusion that the appellant had failed to show that his pattern of working had altered after his return to Australia in October 1984. For these reasons, in my opinion, the appeal should be dismissed with costs. Samuels JA I agree. 4 UNREPORTED JUDGMENTS Handley JA I also agree. The orders of the court, therefore, are those which Clarke JA has proposed; Appeal dismissed with costs. Counsel for the Appellant: K RYAN Counsel for the Respondent: J A McINTYRE Solicitors for the Appellant: PLOWMAN and THOM Solicitors for the Respondent: HUNT and HUNT