Industrial Relations Commission of New South Wales in Court Session CITATION : Lefty's Excavator & Drott Hire Pty Ltd v Samuel Edward Stratti & Ors [2003] NSWIRComm 451 LEFTY'S EXCAVATOR & DROTT HIRE PTY LTD (ACN 082 820 595) Applicant SAMUEL EDWARD STRATTI First Respondent TROY KENNETH STRATTI PARTIES : Second Respondent DETAIL ROCK TOOLS PTY LTD (ACN 076 292 987) Third Respondent STRATTI OCEAN & EARTHWORKS PTY LTD (ACN 067 274 220) Fourth Respondent FILE NUMBER: IRC 2060 of 2000 CORAM: Schmidt J CATCHWORDS : Unfair contract - no agreement reached as to final orders of April judgment - motion filed seeking correction of a figure appearing in the judgment - agreement reached on some calculations - disagreement on others - outstanding issues determined - final calculations and orders to be filed CASES CITED : Lefty's Excavator & Drott Hire Pty Ltd v Samuel Edward Stratti & Ors [2003] NSWIRComm 106 HEARING DATES: 11/11/2003; 11/20/2003; 12/05/2003 DATE OF JUDGMENT: 12/11/2003 APPLICANT: Mr DH Murr SC with Mr JC Thompson of counsel SOLICITORS: R.A. Dunbier & Associates LEGAL REPRESENTATIVES: RESPONDENTS: Ms N Obrart of counsel SOLICITORS: Norman Waterhouse JUDGMENT: - 4 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Schmidt J DATE: 11 December 2003 MATTER NUMBER IRC 2060 OF 2000 LEFTY'S EXCAVATOR & DROTT HIRE PTY LTD v SAMUEL EDWARD STRATTI & ORS Application under section 106 of the Industrial Relations Act 1996 JUDGMENT 1 Judgment in this matter was given on 9 April (Lefty's Excavator & Drott Hire Pty Ltd v Samuel Edward Stratti & Ors [2003] NSWIRComm 106). The parties were directed to confer on the final orders to reflect the judgment. They were unable to reach agreement and the matter was listed for hearing in June. The hearing was adjourned, as the result of further calculations provided by the applicant, shortly prior to the hearing. Further hearings were adjourned, as the result of other calculations provided by the respondents. The respondents later filed a motion, seeking a correction of a figure appearing in the judgment. The parties eventually agreed that a correction needed to be made to the judgment, where reference was made to the applicant's earnings in a particular period. What the correction should be was not agreed, with the respondents putting forward two possible figures and the applicant a third. 2 When the matter finally came on for hearing, some common ground had been found and further agreement emerged during the hearing. Some differences remained, which require the Court's determination. Final calculations will need to be made by the parties, having regard to these later emerging agreements and the conclusions reached in this judgment. 3 I deal firstly with the correction of paragraph 116 of the judgment, where the figure $149,412 appears. This figure apparently came from a tax return. The alternative figures proposed by the respondents were $290,691, reflecting the applicant's gross receipts, or $285,722.75, the applicant's gross invoices, with the respondents pressing the higher figure, having regard to the reference in the judgment to gross takings or gross earnings. The applicant's position was that it was invoices, not receipts which were relevant, because not all receipts reflected payment for work performed. As to the figure, its attitude was that the sum of $285,722.75 had to have deducted a sum of $4,485, reflecting the fact that on some invoices hammer work had been charged at the rate of $130 per hour, but the respondents had refused to pay more than $100 per hour. 4 I am satisfied that the figure proposed by the applicant is the correct figure. It is invoices for work performed, not receipts for such work and other income to which regard must be had. Account must also, however, be taken of the lower hammer rate paid by the respondents, who refused to pay the higher rate claimed by the applicant in its invoices. 5 I also note that the parties were agreed that the figure $45,000 which appears in the judgment should be $45,600. On that basis, the figures which appear in the schedule to the applicant's proposed orders, exhibit 39, in paragraph 1 were agreed. The parties also reached agreement that the proper approach to the calculation of interest was that contained in the respondents' proposed orders, exhibit 42, schedule 1, paragraph C. That approach needs now to be applied to the resulting figure of $43,000. 6 Paragraph 3 of schedule 1 to exhibit 39 was agreed, as was the sum of $11,550, which appears in paragraph 4, to which interest must be added, in accordance with the respondents' approach. 7 The parties were not agreed that the applicant's earnings should be further reduced by reference to the hammer hire charge, which it was concluded in the judgment the respondents should have the benefit of. The position of the respondents was that in ascertaining the applicant's gross earnings, no account could be taken of a cost of the business, even a notional one, such as this. The approach of the applicant was that if the respondents were to have the benefit of that charge, its earnings should be reduced accordingly. 8 I am satisfied that the applicant's approach cannot be accepted. If it were, the respondents would have effectively lost the benefit of the charge. Nor is it appropriate to pay regard to a cost of the business, in ascertaining gross takings. 9 The next matter to be considered is the hours worked by the applicant in addition to the hours the subject of the contractual promises. The applicant, in reply, accepted the respondents' calculation of the total of 578.5 hours worked beyond 8 hours per day. The rate remained in issue. 10 In reply, the applicant accepted the arguments advanced by the respondents, that its calculations, which had led to an hourly rate of $158.75 involved a misreading of paragraph 115 of the judgment. The respondents' figures were, nevertheless, still opposed. 11 The respondents had calculated an hourly rate by dividing the applicant's total earnings, by the total hours over the course of a year, to arrive at an average hourly rate of $117.75. This included rock saw work charged at $200 per hour; bucket work charged at $90 per hour and other work charged at other rates falling between the two. 12 The applicant submitted that such an approach rewarded the respondents for its failure to provide the promised rock saw work. The less of such work supplied, the lower the average rate derived from such a calculation. A more appropriate average rate was submitted to be $124.45 per hour, reflecting the guaranteed $230,000, if earned over 231 days of 8 hours work. 13 Given the conclusions reached in the judgment and the parties' acceptance that an average approach should be adopted to this aspect of the calculation, I am satisfied that the applicant's approach to this calculation must be preferred. In my view, it does not suffer from the vice complained of and has appropriate regard to the fact that the actual earnings were not as promised, because the promised rock saw work did not materialise. An interest calculation must also be made on the resulting sum. 14 The parties were otherwise agreed on the orders to be made. It follows that the final calculations must now be made, so that final orders can follow. The orders should be reflected in a consent document, which I will deal with in Chambers, upon filing. It should also attend to the correction of the judgment. 15 The final terms of the order should be filed on or before 18 December. ------------------------ DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.