Supreme Court New South Wales Medium Neutral Citation: Assadourian v Roads and Traffic Authority of New South Wales (Northern Region) [2011] NSWSC 1052 Hearing dates: 30/06/2011 Decision date: 09 September 2011 Jurisdiction: Common Law - Administrative Law Before: Rothman J Decision: (i) The question purportedly referred not answered; (ii) Proceedings dismissed; (iii) Costs of these proceedings shall be costs in the cause and abide the outcome of the substantive proceedings before the Administrative Decisions Tribunal; (iv) The parties have liberty, to the extent so advised, to file and serve written submissions within 7 days of the date hereof to the extent that a different order is sought as to the costs of these proceedings. Catchwords: ADMINISTRATIVE LAW - purported reference of a question of law from the Administrative Decisions Tribunal - consent orders for remitter to single judge - doubt expressed as to capacity to remit to single judge by consent - question is a conclusion of fact, not a question of law and is not answered Legislation Cited: Administrative Decisions Tribunal Act 1997 Civil Procedure Act 2005 Supreme Court Act 1970 Tow Truck Industry Act 1998 Uniform Civil Procedure Rules 2005 Workers' Compensation Act 1946 (VIC) Cases Cited: Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd [1982] HCA 23; (1982) 150 CLR 169 Australian Gaslight Co v Valuer-General (1940) SR (NSW) 126 B & L Linings Pty Limited v Chief Commissioner of State Revenue [2008] NSWCA 187 Collector of Customs v Agfa Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389 Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 Edyp & Ors v Brazbuild Pty Ltd [2011] NSWCA 218 Fairway Estates Pty Ltd v Federal Commissioner of Taxation [1970] HCA 29; (1970) 123 CLR 153 Gordian Runoff Limited v Westport Insurance Corporation [2010] NSWCA 57 Hope v Bathurst City Council [1980] HCA 16; (1980) 144 CLR 1 Humberstone v Northern Timber Mills [1949] HCA 49; (1949) 79 CLR 389 Hungier v Grace [1972] HCA 42; (1972) 127 CLR 210 Hyde v Sullivan (1956) SR (NSW) 113 JS McMillan Pty Ltd & Ors v Commonwealth of Australia [1997] FCA 619; (1997) 77 FCR 337 Kirk v Industrial Relations Commission [2010] HCA 1; (2010) 239 CLR 531 L&B Linings Pty Ltd v WorkCover Authority of New South Wales [2011] NSWSC 474 Muldoon v Church of England [2011] NSWSC 772 NT Power Generation Pty Ltd v Power and Water Authority [2004] HCA 48; (2004) 219 CLR 90 Ormwave Pty Limited v Smith [2007] NSWCA 210; (2007) 5 DDCR 180 Re Griffin; Ex Parte Board of Trade (1890) 60 LJQB 235 Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd; Carelli v FS Architects Pty Ltd [2008] NSWCA 39 Vitaz v Westform [2011] NSWCA 254 Category: Principal judgment Parties: John Assadourian (First Plaintiff) Towman Pty Ltd (Second Plaintiff) Roads and Traffic Authority of New South Wales (Northern Region) (Defendant) Representation: Counsel: M Condon (Plaintiffs) J Kirk / J King (Defendant) Solicitors: Sage Solicitors (Plaintiffs) Smythe Wozniak Legal (Defendant) File Number(s): 2011/32583 Judgment The Supreme Court's jurisdiction 1The parties seek an answer to a question referred by the Administrative Decisions Tribunal (hereinafter "ADT") to the Supreme Court. When the matter came before the Court as presently constituted, I raised with the parties the jurisdiction of a judge of the Common Law Division to determine the question referred. 2On 22 December 2010, pursuant to s 79A(1) of the Administrative Decisions Tribunal Act 1997 (hereinafter "ADT Act"), the ADT referred a question that the parties allege is a question of law which arose in proceedings before the ADT. The parties consented to the reference to the question of law, requested the President of the ADT to refer it and were successful in that request. No criticism is made of the ADT, or any of its members, in consenting or agreeing to the application of the parties for the referral of the question. 3Pursuant to the terms of s 48 of the Supreme Court Act 1970, the ADT, being a body of persons having amongst its number a judge, as such, is a specified Tribunal and cases stated by it are assigned to the Court of Appeal. Further, the provisions of s 48(2)(ha) of the Supreme Court Act assign to the Court of Appeal any proceeding to determine any question of law referred to the Supreme Court for its opinion under the ADT Act. 4When the matter came before the Registrar of the Court of Appeal, the parties filed a consent order, purportedly pursuant to s 51(4) of the Supreme Court Act, that the whole of the proceedings be remitted to the Common Law Division for determination. The Registrar, by consent, issued such an order. 5The provisions of s 51(4) require that, for proceedings to be remitted, the "Court of Appeal ... [must] order that the whole or any part of the proceedings be remitted". The Court of Appeal consists of the Chief Justice, the President of the Court of Appeal and such other judges as are appointed to be judges of appeal and/or acting judges of appeal: s 42 of the Supreme Court Act. The parties do not submit that the Registrar of the Court of Appeal was, in that sense, part of the Court of Appeal. 6Nevertheless, it is submitted that the Registrar, being an officer of the Court may exercise such powers as are conferred upon the officer, which, pursuant to s 13 of the Civil Procedure Act 2005, is said to include the issuing of consent orders. These orders were consent orders. The only reference to the power of a Registrar to make orders of this kind by consent is the delegation of power referrable to r 36.1A of the Uniform Civil Procedure Rules 2005 (hereinafter, "UCPR"), which allows the Court to give judgment, or order that judgment be entered, in the terms of an agreement between parties in relation to proceedings between them. These consent orders do not, on their face, seem to be of a kind contemplated by UCPR r 36.1A. 7It would seem that the legislative intention expressed in s 48 of the Supreme Court Act cannot be overridden by the consent of the parties. The jurisdiction of the Court, or a judge of it, cannot be extended by consent. In those circumstances, consent orders purporting to remit a matter to a judge of a Division, issued by a Registrar under general powers, would, on its face, seem to be an inappropriate mechanism to overcome the express limitations promulgated by the legislature. For a matter, within the original jurisdiction of the Court of Appeal, to be remitted to a single judge of the Court requires an evaluation by a judge or acting judge of the Court of Appeal. 8The difficulty with the foregoing conclusion is that the terms of s 121(4) of the Supreme Court Act give a consent judgment or order, issued by the Registrar, effect as a judgment or order of the Court, whether or not the judgment or order is within the powers conferred upon the Registrar. In that sense, the Registrar constitutes the Court for the purpose of the exercise of the powers referred, but, if, in the bona fide exercise of those powers, the Registrar issues a judgment or order that is beyond power, s 121 gives that judgment or order the status of a judgment of the Court. Leaving aside issues associated with whether such general powers can override the specific powers and restrictions in s 48 of the Supreme Court Act, the order of the Registrar is valid until set aside. 9The inappropriateness of a consent order remitting the matter from the Court of Appeal to a judge of a Division is not simply related to the technical construction of the Supreme Court Act. The President of the ADT, who has consented to the referral of the question to the Court, is a judge of the District Court of New South Wales. Cases stated from the District Court go to the Court of Appeal. The President of the ADT in exercising his powers would reasonably have assumed that, in consenting to refer the question to the Supreme Court, the matter would be determined by the Court of Appeal. That expectation has been thwarted by the agreement of the parties. It is unclear whether, if the President of the ADT were to have known that the matter would be determined by a single judge, the President would have refused the reference of the question, required that the matter be determined in totality before the ADT and left to the parties such rights of appeal and/or judicial review as the parties may be advised to exercise. 10No party seeks the setting aside of the consent orders issued by the Registrar and, given the manner in which the matter of jurisdiction arose, the Court was not minded to set aside the order of its own motion or to complicate the proceedings further. It is unnecessary for the Court, as presently constituted, to determine finally whether it has jurisdiction as a consequence of the consent orders issued by the Registrar. Agreed facts 11The parties have agreed to the following factual basis for the determination of the question referred to the Court: "Background 1. The applicant, John Assadourian, is and has been since 2 November 2004 the sole director, secretary and shareholder of Towman Pty Ltd (Towman) (see tab A). 2. The respondent, the Roads and Traffic Authority of New South Wales (RTA), has the function of regulating the tow truck industry in accordance with the Tow Truck Industry Act 1998 (NSW) (the Act) and the Tow Truck Industry Regulation 2008 (NSW) (the Regulations). 3. From 30 April 2004 to 30 April 2008, Towman held a tow truck operators licence (04023) pursuant to Div 1 of Pt 3 of the Act (see tab B) and carried on business as a tow truck operator. During the same period, Mr Assadourian held a tow truck drivers certificate (41642) pursuant to Div 2 of Pt 3 of the Act (see tab C). 4. At all material times, Northern Division Towing Pty Ltd (NDT) and Combined Towing Service (NSW) Pty Ltd (CTS) have also held tow truck operators licences (07051, 00001) and carried on business as tow truck operators (see tab D). NDT was a wholly-owned subsidiary of CTS (see tab E) and, in practical terms, NDT and CTS operated a single towing business. 5. On 30 April 2008, Towman ceased to hold a tow truck operators licence. Mr Assadourian has never held a tow truck operators licence. 6. From 1 May 2008, Mr Assadourian drove a tow truck NDT leased from Towman (the Leased Tow Truck). NDT paid Towman for the towing work which Mr Assadourian had undertaken in the Leased Tow Truck. 7. A reference in this statement of agreed facts to operating a tow truck should be read as a reference to the operation of that tow truck for the purpose of towing motor vehicles. History of proceedings 8. On 2 April 2008, Mr Assadourian advised the RTA that Towman would not be renewing its tow truck operators licence beyond 30 April 2008 (see tab F). Mr Assadourian also advised the RTA that he intended to lease one of Towman's tow trucks (9644TT) (the Leased Tow Truck) to NDT and to sell Towman's two remaining tow trucks to NDT (see tab F). 9. On the same day, CTS advised the RTA that Towman had leased to CTS the Leased Tow Truck for a period of five years commencing that day (see tab G). 10. On 16 April 2008, the Leased Tow Truck was authorised to operate under NDT's tow truck operators licence (see tab H). 11. The Leased Tow Truck was registered in the name of Towman up to 16 April 2008 and in the name of NDT from 16 April 2008. Behind tab I are copies of certificates of registration for the Leased Tow Truck in the names of Towman and NDT, the latter with a receipt for payment dated 16 April 2008 and an expiry date of 13 August 2008. Behind tab J is a copy of a certificate of registration for the Leased Tow Truck, also in the name of NDT, with an expiry date of 13 August 2009. 12. In November 2008, the RTA determined to renew Mr Assadourian's tow truck drivers certificate by granting a subsequent drivers certificate to Mr Assadourian for a period of one year until 27 November 2009 (see tab K). 13. By a letter dated 24 November 2008, the RTA expressed its opinion that Towman was breaching section 15 of the Act (see tab L). The letter stated: 'The RTA understands this decision may affect you significantly as the legal entity. If you continue to operate [as] a S/C [subcontractor] for [NDT] you will be required to obtain an operators licence by the 16 February 2009.' On 24 February 2009, Towman applied to the RTA for a tow truck operators licence (see tab M). The RTA determined to refuse this application on 27 July 2009 (see tab N). 14. On 21 October 2009 the RTA received an application from Mr Assadourian for a subsequent tow truck drivers certificate (see tab K). The RTA determined to refuse this application on 10 December 2009 (see tab O). 15. On 15 December 2009 Mr Assadourian applied to the NSW Administrative Decisions Tribunal (ADT) for a review of the RTA's refusal to grant a subsequent drivers certificate. On the same day, Mr Assadourian applied for a stay of the RTA's decision. 16. On 22 December 2009, the ADT determined to stay the RTA's decision. The Leased Tow Truck 17. Prior to 30 April 2008, Towman owned and operated three tow trucks as part of its towing business. 18. Two of the tow trucks were held free of encumbrances, and the third (being the Leased Tow Truck) was mortgaged to CBFC Limited pursuant to an equipment loan and goods mortgage agreement (see tab P). The mortgage was registered pursuant to the Registration of Interests in Goods Act 1986 (NSW). 19. Under the loan agreement, CBFC Limited agreed to loan to Towman $80,000 for the purchase of the tow truck from Suburban Towing & Equipment Pty Limited. Towman agreed to repay the loan with interest of $27,063, mortgage the tow truck to CBFC Limited and provide personal guarantees from Mr Assadourian and his wife. 20. Towman also agreed that the credit provided under the agreement was to be applied wholly or predominantly for business or investment purposes (or for both purposes). 21. In or about April 2008, Towman sold two of its tow trucks to NDT. On 2 April 2008, Towman leased to NDT for a period of five years the Leased Tow Truck that was the subject of the mortgage to CBFC Limited. Since that time, Towman has continued making loan repayments to CBFC Limited with respect to the Leased Tow Truck. 22. The Leased Tow Truck has, at different times, been identified by different number plates and registration numbers, including 9233TT, 9644TT, AU30WR and 9814TT. There is only one leased tow truck. 23. At tab G is a copy of a document signed on behalf of NDT and Towman, addressed to the RTA's predecessor. The terms of the lease were otherwise oral. 24. Shortly after the lease commenced, NDT arranged for the logos of NDT, Combined Alliance and the NRMA to be affixed to the Leased Tow Truck. At tab Q is a series of photographs of the Leased Tow Truck and the paint scheme applied to it since April 2008. 25. On or about 2 April 2008, Mr Assadourian was recorded on the operators licence of NDT as a close associate, as he was the sole director of the lessor of the Leased Tow Truck (see tab R). 26. The relevant certificates of registration for the Leased Tow Truck, under the heading 'Conditions', showed the words 'USAGE: TOW TRUCK - BUSINESS USE' (see tabs I and J). 27. Towman has not entered into any other relevant leases. Mr Assadourian's relationship with NDT 28. On 30 April 2008, Mr Assadourian signed a document given to him by NDT titled 'Employee Acknowledgement' (see tab S) pursuant to which, amongst other things, Mr Assadourian acknowledged that he had been given a copy of, and had read and understood, the requirements of the Act and the Regulations as amended. 29. At the same time, Mr Assadourian received from NDT a document entitled 'Combined Towing Services - Tow Truck Drivers Instruction Manual', a copy of which is behind tab T (the 'Manual'). 30. Mr Assadourian drove the Leased Tow Truck pursuant to a contract to which NDT was a party. 31. The contract with NDT was partly in writing and partly oral. To the extent it was written, Mr Assadourian confirmed that he had read and understood and would comply with all matters detailed in the contents of the Manual (see tab S). The Manual was applicable to, and adhered to in, the relationship between NDT, Mr Assadourian and Towman to the extent that it was relevant. Policies in the Manual that did not apply to Towman and Mr Assadourian were: (a) Sick Leave (on p.3); (b) Annual Leave (on p.3); (c) Salary Review (on p.5); 32. To the extent it was oral, it was agreed that: (a) Towman would surrender its operators licence. (b) NDT would lease the Leased Tow Truck from Towman. (c) Mr Assadourian would work for NDT as a tow truck driver. (d) NDT would be responsible, in the first instance, for: i. Paying for the repairs and maintenance of the tow truck (although on some occasions Towman would itself pay for repairs directly); ii. Paying the purchase price for the towing authority books; iii. Providing the use of the portable radios and electronic touch screen computer and the electronic tracker for the tow truck; and iv. Paying the cost of insurance and registration for the Leased Tow Truck, and these amounts were deducted from the amounts payable by NDT to Towman as described below in sub-paragraph (h). (e) Towman would be responsible for its own workers compensation, tax and superannuation. (f) NDT would charge its customers the maximum fees then prescribed by Part 4A of the Regulations, and NDT would pay to Towman the fees set out in the document behind tab U for towing work Mr Assadourian undertook in the Leased Tow Truck for NDT. (g) NDT would receive the balance of any income generated from the above tows. (h) NDT would deduct the following costs from the amount to be paid to Towman from time to time: i. Cost of repairs and maintenance of the tow truck; ii. The cost of purchasing the towing authority books; iii. The cost of $60.00 per week for a two-way radio and data tracker; iv. The cost of insurance and registration for the Leased Tow Truck; v. The cost of a digital camera (a one-off deduction); vi. Uniform costs (as occasion arose); and vii. The cost of sign writing for the tilt tray (a one-off deduction). (i) NDT would charge Towman a further 9% of the amount paid to Towman each week as an administration fee. (j) Towman would be responsible for: i. Paying for the fuel consumed by the tow truck; ii. Obtaining its own workers compensation; and iii. Paying its own tax, including GST and company income tax; iv. Paying Mr Assadourian's income and withholding PAYG amounts on account of Mr Assadourian's personal income tax; and v. Making any superannuation contributions to or for Mr Assadourian. (k) Towman was only paid for the work performed by Mr Assadourian - if he did not undertake any towing work, NDT did not make any payments to Towman (or Mr Assadourian). 33. The relationship between NDT, Towman and Mr Assadourian has been implemented in accordance with what is set out in the previous paragraph. 34. NDT maintained the records prescribed by the Act and the Regulations. These records included the holding yard register and the tow truck drivers register. 35. No wages were paid by NDT to Mr Assadourian and, in relation to Mr Assadourian, no amounts were withheld by NDT for income tax purposes. 36. The insurance policy maintained by NDT in respect of the Leased Tow Truck encompassed compulsory third party, comprehensive, public liability and on-hook insurance. 37. After Towman ceased to hold an operators licence, Towman did not hold public liability or on-hook insurance. When Mr Assadourian was advised by the RTA that he was required to hold an operators licence, Towman obtained public liability and on-hook insurance in respect of the Leased Tow Truck for the period 17 February 2009 to 13 February 2010 (see tab V). Mr Assadourian has never himself held any relevant insurance policies. 38. The taking of holidays by Towman and Mr Assadourian was dealt with according to the terms of the manual. Towman and Mr Assadourian were expected to give notice of holidays in line with the requirements of the manual. Towman and Mr Assadourian did not receive pay for any such holidays taken, nor was any pay received for the taking of sick leave. 39. When performing towing work, Towman and Mr Assadourian were required to adopt, and did adopt, the practices prescribed by NDT, including the general practices applicable to towing work outlined in the manual. NDT also required Mr Assadourian to wear NDT's uniform and keep the Leased Tow Truck in a clean condition. 40. NDT dispatched towing work to Mr Assadourian and expected Mr Assadourian to undertake the work. Set hours were fixed by NDT during which Mr Assadourian was obliged to answer a dispatch call (these were generally between 6:30 am and 10:30 am and 3:30 pm and 7:00 pm). At other times, Mr Assadourian was on call. The towing activity 41. Every tow job carried out by Mr Assadourian was recorded by his completion of an NDT tow docket for the job. The tow docket showed the job number, relevant prices and any additional charges imposed by the driver. Tow dockets were required to be delivered to NDT's reception by 8 am on the morning following the tow job. NDT reserved the right to fine Towman in the event that Mr Assadourian failed to adhere to this time requirement. 42. NDT issued invoices to insurers for Towman's towing work in the name of NDT and Towman did not issue invoices in its own name or in the name of Mr Assadourian. 43. At the end of each week, the tow dockets submitted by Towman were compiled by staff of NDT into a spreadsheet referred to as a 'log'. The log showed certain details for each tow job, including the distance travelled and the amount payable for that category of tow job. Three typical logs for Mr Assadourian can be found behind tab W. 44. A computer printout of the log was given to Mr Assadourian at the end of each week. This was to provide Mr Assadourian with the opportunity to check the log to verify that all of his tow jobs were included, that all of the tow jobs had been carried out by him, and that the details for all tow jobs were recorded correctly. If necessary, Mr Assadourian handwrote amendments on the log and returned it to NDT. Staff of NDT would discuss any proposed amendments with Mr Assadourian until both agreed upon the final form of the log. 45. Once the log was finalised, NDT created a job statement. Three typical job statements for Mr Assadourian can be found behind tab X. The job statement was an internal document which showed the aggregate of the amounts payable from the tow jobs recorded in Mr Assadourian's log. This gross amount was described as 'Amount of jobs excluding GST'. 46. From the gross amount, NDT subtracted 9% as an administrative fee. NDT also added any relevant bonuses and subtracted any relevant deductions. 47. This net amount was described as 'Amount subject to GST'. NDT then issued to Towman a recipient-created tax invoice in the net amount with the addition of a GST component. Three typical invoices can be found behind tab Y. 48. The recipient-created tax invoices were issued pursuant to a written agreement between NDT and Towman made on 1 May 2008 (see tab Z). 49. Finally, NDT paid Towman the amount and the GST component by direct deposit into Towman's bank account. 50. Once the invoice was issued to Towman, earlier hard copies of the log (showing handwritten amendments) were discarded and only the final log was retained. Towman's financial statements 51. In its tax return for the 08/09 FY, Towman described its main business activity as 'Towing service, motor vehicle' (see tab AA). Towman's gross income was $106,106 and Towman claimed a deduction of $29,998 for 'Motor vehicle expenses'. 52. The return also showed $16,159 for 'salary and wage expenses'. Towman's business activity statements show that $2,054 was withheld from that amount for PAYG income tax withholding (see tab BB). 53. Towman's only source of trading income for the 08/09 and 07/08 financial years was described in its financial statements as 'Fees Received - Towing' in amounts of $106,106.34 and $155,587.01 respectively (see tab CC). 54. In both financial years, Towman incurred substantial expenses for depreciation, fuel and oil, repairs and other costs related to its commercial motor vehicles. 55. Towman has paid to the ATO all amounts of GST paid to Towman by NDT. Mr Assadourian's financial statements 56. In his tax return for the 08/09 FY, Mr Assadourian described his main salary and wage occupation as 'Truck - owner-driver' (see tab DD). The payer was stated to be Towman Pty Ltd and the gross amount earned was $16,159 with $2,054 withheld for PAYG. Relationship between Towman and Mr Assadourian 57. The applicant is, and has been since 4 November 2004, the sole director, secretary and shareholder of Towman (see tab A). 58. The towing work performed by Mr Assadourian was Towman's only source of income and the fees received by Towman were Mr Assadourian's only source of income." The question referred and relevant legislation 12The question of law referred by the ADT is: "Does s 15 of the Tow Truck Industry Act 1998, properly construed, have the effect that the conduct of Mr Assadourian and/or Towman Pty Ltd identified in the Agreed Facts constituted the carrying on of a business as a tow truck operator within the meaning of s 15 of that Act?" 13Section 15 of the Tow Truck Industry Act 1998 (hereinafter the Act) is in the following terms: "15 Requirement for tow truck operators to be licensed A person must not carry on business as a tow truck operator unless the person holds a tow truck operators licence that authorises the kind of towing work carried on by the person in the course of that business. Maximum penalty: 100 penalty units or imprisonment for 12 months, or both." 14It is also necessary to refer to the provisions of s 23 of the Act which is in the following terms: "23 Requirement for tow truck drivers to hold drivers certificates (1) A person must not: (a) drive or stand a licensed tow truck on a road or road related area at any time, or (b) use or operate, or assist in the use or operation of, a licensed tow truck on a road or road related area at any time, or (c) drive or stand a tow truck (other than a licensed tow truck) on a road or road related area at any time for the purposes of towing a motor vehicle for fee or reward, unless the person holds a drivers certificate. Maximum penalty: 50 penalty units or imprisonment for 6 months, or both. (2) A certified driver must not carry on any kind of towing work other than the kind of towing work that is authorised by the drivers certificate. Maximum penalty: 50 penalty units or imprisonment for 6 months, or both." 15It is submitted that, as a consequence of the provisions of ss 15 and 23 of the Act, the legislature has differentiated between a tow truck driver who must hold the requisite licence and a tow truck operator who must hold a different licence. Drivers are licensed pursuant to the terms of s 23 of the Act and operators under s 15 of the Act. A tow truck operator is a person who is defined by s 3 of the Act as "a person who conducts a business involving the operation of any tow truck for the purposes of towing motor vehicles". The term "tow truck driver" is not defined in the Act. Is the question referred a question of law? 16The parties correctly assert that the answer to the question turns on the proper construction of the phrase "carry on business as a tow truck operator" in s 15 of the Act. The section, given the nature of the definition of tow truck operator in s 3 of the Act, has a degree of circularity. By s 15 of the Act, a person must not carry on business as a tow truck operator, but a tow truck operator means a person who conducts a business involving the operation of any tow truck for the purposes of towing motor vehicles. Thus, it would seem that the legislature has required the consideration of "carrying on of a business", within its ordinary meaning, which involves the operation of a tow truck for the purposes of towing motor vehicles, as a central criterion in the determination of whether the requirements of s 15 of the Act have been contravened. 17The Road and Traffic Authority of New South Wales (hereinafter "RTA") submits that Mr Assadourian and/or Towman Pty Ltd (hereinafter "Towman") carried out towing activities on repeated occasions, or systematically and regularly, on a continuous and repetitive basis, with a view to profit. RTA submits that as a consequence of the foregoing, Mr Assadourian and/or Towman are engaged in, and carrying on, a business as a tow truck operator. 18There is little doubt that much authority can be found on the meaning of a term "carrying on a business" which authority suggests that, while the term must be construed in a particular context of the statute in which it is used ( NT Power Generation Pty Ltd v Power and Water Authority [2004] HCA 48 at [66]; (2004) 219 CLR 90 at 116, per McHugh ACJ, Gummow, Callinan and Heydon JJ; Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd [1982] HCA 23; (1982) 150 CLR 169 at 184, per Gibbs CJ), in its ordinary meaning it signifies a course of conduct involving the performance of repeated acts, or a course of conduct (even if it is the first act in an intended course of conduct) being a form of commercial enterprise with a view to profit: see Fairway Estates Pty Ltd v Federal Commissioner of Taxation [1970] HCA 29; (1970) 123 CLR 153 at 163; Re Griffin; Ex Parte Board of Trade (1890) 60 LJQB 235 at 237; Hungier v Grace [1972] HCA 42; (1972) 127 CLR 210; JS McMillan Pty Ltd & Ors v Commonwealth of Australia [1997] FCA 619; (1997) 77 FCR 337 at 354; Hyde v Sullivan (1956) SR (NSW) 113; Hope v Bathurst City Council [1980] HCA 16; (1980) 144 CLR 1 at 8-9; Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd; Carelli v FS Architects Pty Ltd [2008] NSWCA 39, per Campbell JA (with whom McColl JA and Handley AJA agreed). 19As is made clear from the foregoing Agreed Facts, Towman originally owned and operated three tow trucks as part of its own towing business. Two of those tow trucks were sold to Northern Division Towing Pty Limited (hereinafter "NDT"), and the third, while retained by Towman, who continued to make payments in relation to a mortgage over the vehicle, was leased to NDT for a period of 5 years. Mr Assadourian, the sole director of Towman, worked for NDT on the tow truck that Towman had leased to it. 20It would seem that the agreement between Mr Assadourian and NDT sought to establish that Mr Assadourian was not an employee of NDT. Whether it was successful in that is not a matter that is currently before the Court. 21A person could remain or become an employee of a tow truck operator and be licensed only as a driver. Because in a strict sense, or on one view, every independent contractor carries on a business, the submission of the RTA is to the effect that, other than employees, every other person who is engaged by a tow truck operator is required to have a separate tow truck operator's licence. While the RTA does not express its submission in quite those terms, the necessary effect of its submission must lead logically to that conclusion. 22If the legislature were minded to limit persons who could drive a tow truck while holding only a tow truck drivers' licence, and not a tow truck operators' licence, to persons who were employees, it could have very easily expressed that proposition. It has not. 23An independent contractor who does not engage in a business that is independent of a tow truck operator may or may not be an operator as distinct from a driver. 24In a different context, this is the same question that was discussed by the High Court of Australia in Humberstone v Northern Timber Mills [1949] HCA 49; (1949) 79 CLR 389. In that judgment, the High Court was construing the terms of the Workers' Compensation Act 1946 (VIC) and, in particular, the words contractor performing work "not being work incidental to a ... business regularly carried on by the contractor". 25In L&B Linings Pty Ltd v WorkCover Authority of New South Wales [2011] NSWSC 474, I had occasion to deal with the judgment of Dixon J in Humberstone , supra. I said: "[46] In the judgment of Dixon J, in Humberstone, supra, widely cited with approval and/or relied upon in other judgments, his Honour, at 401-402, said: 'There are two difficulties in applying the provision to the facts. The first is to say whether, upon the true meaning of the phrase in the sub-section, the work the deceased performed for the respondents was or was not "work incidental to a trade or business regularly carried on by the contractor in his own name or under a firm or business name." ... ... I think that the purpose of the exception or exclusion expressed by the words in question was to confine the benefit of the conclusive presumption which it establishes to persons who do not conduct an independent trade or business, who are not holding themselves out to the public under their own or a firm or business name as carrying on such a trade or business and who do not in the course of that trade or business, as an incident of its exercise, undertake the work by entering into the contract. The provision will thus cover men [sic] who work for the principal but have no independent business or trade and men [sic] who though carrying on an independent trade or business undertake a contract outside the scope or course of that trade or business. The word "trade" is capable of including any handicraft and in that sense it may seem to lack the element of systematic practice or holding out which the idea of openly conducting a distinct or independent trade or business and seeking custom implies. But a consideration of the policy of the provision as well as of its text appears to me to show that the distinction it seeks to draw is between on the one hand an independent contractor whose relation with the principal is special or particular either because it is outside the course of the general business of the contractor or the general practice of his trade or because he has no such general business or is not a general practitioner of his trade, and on the other hand an independent contractor who performs work successively or perhaps concurrently for his customers or others in the course of a definite trade or business carried on systematically or who holds himself out as ready to do so. ... No doubt the policy is a matter of inference but it seems reasonable to suppose that it was considered proper that a person conducting a business in the course of which he contracted to perform work should himself carry the risk of personal injury as one of the hazards of his business, while the man who worked under contract but only for the employer or without any general trade or business or outside his trade or business should, like an ordinary employee, be insured by the Act against the risk of injury in his work.' ... [58] Central to the concept of the carrying on of a business is, as is stated by Dixon J in Humberstone, supra, at 401 the 'independence' of the activity from the activity of the principal and, in that regard, whether the contractor is not holding itself out to the public (or other principals) under its own or a firm or business name. Contracting with the public is not an essential feature of the definition in Clause 2 of the Schedule, but it is a criterion that would inform the determination of whether the activities of the contractor involved an independent business. As earlier recited, Dixon J in Humberstone, supra, drew the distinction between, on the one hand, an independent contractor whose relation with the principal is special or particular because, inter alia, the contractor has no business or is not a general practitioner of his trade and on the other hand an independent contractor who performs work successively or perhaps concurrently for his customers and others in the course of a definite trade or business carried on systematically: Humberstone, supra, at 402, per Dixon J. [59] In a general sense, almost all of the indicia that are often used to determine if a person is an employee or a contractor are criteria that may be used to inform the determination of whether the contractor is carrying on business independently, i.e. in his own name or under a business or firm name and, therefore, exempted under the first exclusion. ... [60] In that regard, an examination of the criteria may seem like determining whether the contractor is an employee, but, in truth, it is an examination of various criteria to determine whether, on the continuum of relationships, the contractual one is truly independent. Those criteria will include: the level of control of the manner of the performance of work contracted, including the degree to which the contractor is responsible for faulty work; the giving of directions as to where and in what circumstances work is to be performed, including the order in which it is performed; exclusive service or overwhelmingly predominant service for one particular principal; taxation and insurance arrangements; the provision of materials and equipment beyond that ordinarily, in the particular work carried on, supplied by tradespersons or other employees; the manner of termination of the contract; the manner of computation of the remuneration; control over hours of work; whether the contractor operates as part and parcel of the business of the principal; whether there is negotiation as to price; whether there is predetermination of the precise amount of work to be done and a quote to be submitted; whether separate workers' compensation insurance has been taken out by the contractor; and whether the other attributes of an independent business exist, e.g. advertising, telephone entry, etc. and the totality of the relationship between principal and contractor ( Stevens v Brodribb Sawmilling Company Pty Ltd [1986] HCA 1; (1986) 160 CLR 16 at 29). Further, the criteria that may inform this determination may include the ownership of the assets, the chance of making a profit and the risk of loss in the business that is carried on (see Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497 at 526). The foregoing is not, and is not intended to be, exhaustive. Nor is it even indicative; there may be circumstances where some of the foregoing are not relevant." 26The current proceedings involve the interpretation of a penal provision. It is unusual, to say the least, for a court to be asked to determine, in civil proceedings, an issue that would determine the liability of a party to penal sanctions. Nevertheless, the proper construction of s 15 of the Act depends very much on the kind of evaluation to which Dixon J referred in Humberstone, supra, and to which I referred in L&B Linings, supra. 27In other words, the determination of whether Mr Assadourian was carrying on a business as a tow truck operator depends upon an evaluation of a number of criteria, some of which are addressed in the foregoing passages, and the weighing of those criteria in the circumstances of the proceedings. This is typically a task to derive an outcome upon which reasonable persons may differ. The legislature has given that task, namely of evaluating all of the circumstances to determine whether a person is carrying on the business of a tow truck operator, to the ADT. If the ADT decision were to involve a question of law or an error of law, there is recourse to the Court of Appeal: see s 119 of the ADT Act and s 69 of the Supreme Court Act. 28These proceedings are a reference purportedly of "a question of law" arising in the proceedings to which the President of the ADT has consented. The reference to the Supreme Court must be of "a question of law". 29The classic relevant expression of the discrimination between question of law and question of fact derives from the statement of Jordan CJ (with whom Halse Rogers J agreed) in Australian Gaslight Co v Valuer-General (1940) SR (NSW) 126: "In cases in which an appellate tribunal has jurisdiction to determine only questions of law, the following rules appear to be established by the authorities: (1) The question what is the meaning of an ordinary English word or phrase as used in the Statute is one of fact, not of law. This question is to be resolved by the relevant tribunal itself, by considering the word in its context with the assistance of dictionaries and other books, and not by expert evidence; although evidence is receivable as to the meaning of technical terms; and the meaning of a technical legal term is a question of law: Commissioners for Special Purposes of Income Tax v Pemsel. (2) The question whether a particular set of facts comes within the description of such a word or phrase is one of fact. (3) A finding of fact by a tribunal of fact cannot be disturbed if the facts inferred by the tribunal, upon which the finding is based, are capable of supporting its finding, and there is evidence capable of supporting its inferences. (4) Such a finding can be disturbed only (a) if there is no evidence to support its inferences, or (b) if the facts inferred by it and supported by evidence are incapable of justifying the finding of fact based upon those inferences. Thus, if the facts inferred by the tribunal from the evidence before it are necessarily within the description of a word or phrase in a statute or necessarily outside that description, a contrary decision is wrong in law. If, however, the facts so inferred are capable of being regarded as either within or without the description, according to the relative significance attached to them, a decision either way by a tribunal of fact cannot be disturbed by a superior Court which can determine only questions of law." (Citations omitted.) See also Collector of Customs v Agfa Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389 at 395; Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287; Ormwave Pty Limited v Smith [2007] NSWCA 210; (2007) 5 DDCR 180. 30Two relevant aspects should be stressed in relation to the foregoing. First, whether a particular set of facts comes within the description of a word or phrase that is an ordinary English word or phrase is a question of fact, not a question of law. Further, even if the terms of a statute were not ordinary English words and those terms required a legal construction, it is only in circumstances where the Court is posed the question whether the facts as established necessarily take them outside the words as construed (or necessarily renders them within the words to be construed) that a question of law arises. 31In this case, reasonable persons may differ as to the proper categorisation of the facts as they apply to Mr Assadourian and/or Towman. The facts are capable of being regarded as either within or without the description used in s 15 of the Act and the evaluation of whether these Agreed Facts render Mr Assadourian and/or Towman's activities within s 15 or outside s 15 is an evaluative exercise that the legislature has granted to the ADT. 32In the context of the ADT Act, s 79A must be construed bearing in mind the purposes of the statute including, in particular, the provisions of s 119 of the ADT Act. Each provision refers to "a question of law". In the case of s 79A of the ADT Act, the provision permits, with the consent of the President of the ADT, a reference to the Court of "a question of law arising in the proceedings" being a first instance proceeding. 33Section 119 grants a right of appeal to the Court "on a question of law, against any decision of the Appeal Panel". Before that circumstance could have arisen, there would have been a first instance decision (s 122 of the ADT Act), an appeal therefrom (s 113 of the ADT Act), which internal appeal may be made on a question of law and, by leave of the Appeal Panel, may extend to the merits of the decision. See also s 114 of the ADT Act, which expressly restricts internal appeals to "questions of law". 34Further, an aggrieved party may be able to seek certiorari (or orders in the nature thereof) under s 69 of the Supreme Court Act : Kirk v Industrial Relations Commission [2010] HCA 1; (2010) 239 CLR 531. That party may not, however, be able to do so, if there were a right of appeal that would grant the same or similar effective remedy to which recourse has not been sought or without challenging the appeal decision. See Muldoon v Church of England [2011] NSWSC 772 at [29] and [30]; Vitaz v Westform [2011] NSWCA 254 at [8] - [11]. Nevertheless, certiorari would issue for want or excess of jurisdiction or error of law on the face of the record: s 69(3) and s 69(4) of the Supreme Court Act. 35There is, it seems, a distinction between a question of law that may be referred and a question of law that may be appealed. The current circumstance is a good example. 36The parties have agreed on primary facts, and sought to refer a question. Assume the ADT decided that Mr Assadourian was operating a tow truck business and was therefore a "tow truck operator" within s 15 of the Act. In reaching that conclusion, the ADT may or may not engage in reasoning that involves an error of law. The conclusion certainly "involves" a question of law: see B & L Linings Pty Limited v Chief Commissioner of State Revenue [2008] NSWCA 187 at [17], [38], [39], [47], [63], [76], [77] and [79] per Allsop P and [125] and [131] per Basten JA; and Gordian Runoff Limited v Westport Insurance Corporation [2010] NSWCA 57 at [285]. 37As Allsop P said in B & L Linings, supra at [47]: "[47] The phrase 'on a question of law' in the AAT Act, s44(1) has been interpreted as being narrower than the phrase 'involving a question of law'. In TNT Skypak International (Aust) Pty Limited v Commissioner of Taxation [1988] FCA 119; (1988) 82 ALR 175 at 178 Gummow J contrasted the language of s44(1) with that in the old s196 of the Income Tax Assessment Act 1936 (Cth) ('the 1936 Tax Act') which provided for appeals from the Board of Review that 'involved' a question of law. Under s196, if some question of law was involved, the whole of the decision of the Board was open to review, not merely the question of law. As Gummow J said in TNT Skypak at 178: '[t]he existence of a question of law is ... not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal itself'." 38The question purportedly referred by the parties in these proceedings is a conclusion of fact. It remains so, even though the primary facts are agreed. The conclusion of fact may involve a question of law, namely, the proper construction of "tow truck operator" or "carry on business as a tow truck operator", but the question posed is not itself a question of law and is incapable of reference under s 79A of the ADT Act. Moreover, even though there may be an error of law if and when a decision of the ADT emanates, that is not the determinant of whether there is a question of law that is capable of being referred: Edyp & Ors v Brazbuild Pty Ltd [2011] NSWCA 218 at [35] per Allsop P. 39The question purportedly referred is not a question of law that may be referred under s 79A of the ADT Act and the Court refuses to answer the question. 40A subsequent issue arises as to which, if any, of the parties ought bear the costs of the proceedings. Given that the parties agreed on the facts; agreed on the reference to the Court and the question to be referred; and agreed to the remitter, it is unjust for either one of the parties to bear the onus of the costs of these proceedings separately from the outcome of the substantive proceedings before the ADT. In that circumstance, subject to any submission the parties may wish to make as to any other order as to costs, the costs of these proceedings ought to abide the outcome of the proceedings in the ADT. 41The Court makes the following orders: (i) The question purportedly referred not answered; (ii) Proceedings dismissed; (iii) Costs of these proceedings shall be costs in the cause and abide the outcome of the substantive proceedings before the Administrative Decisions Tribunal; (iv) The parties have liberty, to the extent so advised, to file and serve written submissions within 7 days of the date hereof to the extent that a different order is sought as to the costs of these proceedings. ********** 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. Decision last updated: 12 September 2011