Industrial Relations Commission New South Wales Medium Neutral Citation: Port Kembla Coal Terminal Limited v Construction, Forestry, Mining and Energy Union (New South Wales Branch) [2014] NSWIRComm 39 Hearing dates: 19 and 20 May 2014 Decision date: 15 August 2014 Jurisdiction: Industrial Court of NSW Before: Walton J, President; Staff J; Boland AJ Decision: The Full Bench makes the following orders: (1) Leave to appeal is granted. (2) The appeal is allowed. (3) The judgment and orders of Haylen J are quashed. (4) Within 14 days of the date of this judgment the respondent shall file and serve written submissions on costs. The appellant has a further 14 days in which to reply. Unless a party seeks to be heard orally, the question of costs will be determined on the papers. Catchwords: APPEAL - Application for leave to appeal and appeal - UNFAIR CONTRACT - Findings at first instance that contracts or arrangements between Port Kembla Coal Terminal Limited (PKCT) and 78 employees concerning entitlements to superannuation were unfair - Orders made at first instance for compensation - Whether primary judge erred in finding contracts or arrangements were unfair in failing to provide superannuation benefits equivalent in value to the benefits available under the provisions of the State Authorities Superannuation Scheme (SASS) that previously covered employees prior to sale of Coal Terminal to PKCT - Whether primary judge erred in finding individual employees of PKCT were worse off under PKCT superannuation scheme - Whether primary judge erred in finding the contracts or arrangements were unfair because employees were in an inferior bargaining position - Whether primary judge erred in admitting evidence that purported to show superannuation benefits under the PKCT scheme were not of equivalent value to those under SASS - Leave to appeal granted - Appeal upheld - Orders and judgment at first instance quashed. Legislation Cited: Evidence Act 1995 Industrial Arbitration Act 1940 Industrial Relations Act 1996 Workplace Relations Amendment (Work Choices) Act 2005 (Cth) Cases Cited: A&M Thompson Pty Ltd v Total Australia [1980] 2 NSWLR 1 Baker v National Distribution Services Ltd (1993) 50 IR 254 Davies v General Transport Development Pty Ltd [1967] AR (NSW) 371 Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Port Kembla Coal Terminal Ltd [2007] NSWIRComm 296; (2007) 169 IR 141 Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Port Kembla Coal Terminal Ltd [2013] NSWIRComm 92 Dasreef Pty Ltd v Hawchar [2011] HCA 21; (2011) 243 CLR 588 Haddad v S & T Income Aid Specialists Pty Ltd (1984) 13 IR 16 Hasyim v Lark [1979] AR (NSW) 909; Kennedy v Martinez [2011] NSWIRComm 137 Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705 Port Kembla Coal Terminal Ltd v Industrial Court of New South Wales [2009] NSWCA 70; (2009) 182 IR 453 Port Macquarie Golf Club v Stead (1996) 64 IR 53 Terzian v Gattellari [1972] AR (NSW) 591 Category: Principal judgment Parties: Port Kembla Coal Terminal Limited (Appellant) Construction, Forestry, Mining and Energy (New South Wales Branch) (Respondent) Representation: RC Kenzie QC with SEJ Prince of counsel (Appellant) AR Moses SC with R Reitano of counsel (Respondent) Ashurst Australia (Appellant) Slater & Gordon (Respondent) File Number(s): IRC 895 of 2013 Judgment 1Port Kembla Coal Terminal Limited ("PKCT" or "appellant") has sought leave to appeal and, if leave is granted, to appeal from a decision and orders of Haylen J in Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Port Kembla Coal Terminal Ltd [2013] NSWIRComm 92. 2The decision and orders under appeal concerned a claim under the unfair contract provisions (Pt 9 of Ch 2) of the Industrial Relations Act 1996 ("IR Act") by the Construction Forestry, Mining and Energy Union (New South Wales Branch) ("CFMEU" or "respondent") in relation to superannuation benefits. The claim was brought on behalf of approximately 78 members of that Union who had been employed by the appellant since mid-August 1990. 3The employees had ceased employment with the Maritime Services Board ("MSB") and took up employment with PKCT following the Government's decision to privatise the coal terminal at Port Kembla. Whilst employed by the MSB the employees were engaged as public sector employees and were eligible to contribute to public sector superannuation funds; funds that were regarded as providing a superior superannuation entitlement than generally available to employees in private sector employment. Whilst employed by the MSB some of the employees were contributing to the New South Wales Retirement Fund ("NRF"), but by the time of privatisation in 1990, these MSB employees were entitled to and many did, contribute to the State Authorities Superannuation Scheme ("SASS" or "SASS scheme") - a defined benefit fund - while some belonged to other schemes. 4New superannuation arrangements - the Port Kembla Coal Terminal Superannuation Fund ("PKCT Fund" or "PKCT scheme") - were negotiated by PKCT management and the unions on site, as the Government at the time was unwilling to allow the employees continued participation in the SASS scheme. The PKCT Fund was an accumulation type fund. 5It was asserted before Haylen J that each of the employees' contracts with PKCT was unfair because in establishing the PKCT Fund, PKCT failed to live up to a representation that it made to the former MSB employees who accepted employment with PKCT in 1990, to the effect that the new fund would provide equivalent benefits to the SASS scheme and employees would be no worse off under the new fund. 6Haylen J described the essence of the claim he had to decide in the following terms (at [2]), viz: [T]hat PKCT had represented to employees that superannuation arrangements would be made for them as employees of PKCT and they would be at least equal to their entitlements under public sector superannuation arrangements applicable whilst they were employees of the MSB. It was alleged that in several respects the superannuation scheme adopted by PKCT was inferior to benefits available under previous public sector superannuation arrangements to the extent that employees were misled as to the level of benefits available to them under the PKCT scheme and were thereby disadvantaged. 7His Honour found the contracts of employment between the appellant and the employees were unfair in failing to provide superannuation benefits equivalent in value to the benefits available under the provisions of SASS. His Honour also found that as a result individual employees of PKCT were worse off. Consequently, his Honour made certain money orders that he considered were in connection with the unfairness found. 8The appellant contended that Haylen J erred in six primary respects, which we shall later address, and sought orders dismissing the respondent's application for relief. First instance judgment 9His Honour's judgment is a lengthy one, consisting of 392 paragraphs. It addresses in very considerable detail all of the evidence in the proceedings and as well, of course, the law, the arguments of the parties and his Honour's findings. 10Haylen J noted that from 1990, PKCT and its employees in relation to the coal terminal were bound by a series of industrial agreements made under the IR Act. From 27 March 2006, the Workplace Relations Amendment (Work Choices) Act 2005 (Cth) commenced with the effect that pre-existing State Enterprise Agreements became Preserved Collective State Agreements under the Work Choices provisions. Those agreements contained specific provisions prescribing the level of superannuation contributions required to be made by the employer on behalf of the employees. That situation led PKCT to challenge the jurisdiction of the Industrial Court of New South Wales to make the orders sought in these proceedings because of asserted inconsistency with the Commonwealth Work Choices legislation. 11His Honour noted further that the Full Bench of the Industrial Court rejected PKCT's challenge in December 2007 (see Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Port Kembla Coal Terminal Ltd [2007] NSWIRComm 296; (2007) 169 IR 141). PKCT then took the same challenge to jurisdiction to the Court of Appeal, but that challenge was also unsuccessful (see Port Kembla Coal Terminal Ltd v Industrial Court of New South Wales [2009] NSWCA 70; (2009) 182 IR 453. 12Haylen J observed that although unsuccessful in these jurisdictional arguments, the challenge by PKCT resulted in the CFMEU amending its summons for relief under s 106 of the IR Act by limiting the claim to the period August 1990 (when employment commenced with PKCT) to 26 March 2006 (just prior to the coming into operation of the Work Choices legislation). 13The primary judge then recorded the following matters: (1)Dispute proceedings were listed before Hungerford J in May and June 1990 over the superannuation issue. There was considerable industrial disruption occurring at the time over the sale of the terminal. Hungerford J was informed by a Mr Bunting, appearing for the consortium that had purchased the coal terminal, that the consortium had engaged Mercer Campbell Cook and Knight ("Mercer") as consultants and that in view of the fact the SASS scheme would no longer be available, Mercer was working on a proposal for superannuation for PKCT employees. (2)The consortium had placed a proposal before a meeting of the Joint Working Party on 7 June 1990. The consortium was aware that the unions wished to take expert advice on the proposal and another meeting was scheduled for the following day. Any concerns could then be discussed. (3)The Federated Engine Drivers' and Firemen's Association (FEDFA) informed Hungerford J on 13 June 1990 that, upon receiving the consortium's proposal, it had been referred to Bain & Co as the ACTU's endorsed superannuation advisor and the unions had received a number of recommendations from that source based on what was pre-existing under the SASS scheme. The union's concern was that the consortium fund should provide benefits "which in the particular sense could be said to be as good as, if not better than, what was under the State superannuation schemes". The union also raised particular concerns that were to be discussed by the Joint Working Party. The matters raised by the union were said to be "crucial" to an acceptable package. (4)Mr Bunting, for the consortium, concluded the proceedings by responding to the union's concern. In that respect Mr Bunting stated: The only other thing we wish to do is remind Mr O'Connor that on the last occasion when we gave an indication of the style of the fund that would be no less beneficial, that was expressly on the basis that taken in the round, it would not be any less beneficial and we do not want to be in a position of having to match SASS case by case. It has to be looked at in a global way but we have taken on board what Mr O'Connor has said and we will be happy to discuss those matters tomorrow in the working party context. (5)PKCT's proposal was discussed at a meeting of the Joint Working Party on 14 June 1990. The proposal was rejected by employees. The evidence for the respondent was that union representatives at that meeting of the Joint Working Party raised deficiencies in the proposed scheme and requested consideration be given to the matters raised in order to improve the proposed scheme. (6)In due course, an amended superannuation scheme was proposed by Mercer that was meant to address concerns raised by the union representatives. (7)In a notice to employees dated 11 July 1990, the Joint Working Party recommended a new superannuation fund to employees. On 24 July 1990, the Joint Working Party issued a statement regarding superannuation. An explanatory leaflet was attached regarding the terms of the new superannuation scheme and again the Joint Working Party expressed its satisfaction that the proposed fund was "appropriate" for PKCT employees. On 9 August 1990, Mr Dixon, the finance manager, forwarded a letter to all employees advising that the new fund would be operative from 13 August 1990 and attaching a fund brochure. Employment with PKCT also commenced on 13 August 1990. 14At [20]-[21] of his reasons, Haylen J summarised the evidence of 70 employees and ex-employees as to their expectations of the new superannuation fund. At [22]-[93] his Honour dealt with the evidence of the union delegates regarding their involvement in negotiations and as members of the Joint Working Party. His Honour's treatment of that evidence was largely a matter of recording it rather than any analysis of the evidence. At [94]-[151] his Honour recorded the evidence of the four witnesses for PKCT. 15His Honour's analysis of the evidence of employees, union representatives and managers appears largely under the heading "Common threads in the evidence" at [254]-[270]. Relevantly, his Honour's findings included a common theme existing in the evidence that "reliance was placed upon the recommendation of the Joint Working Party and therefore employees voted to accept the scheme proposed in July 1990 as representing an equivalent scheme to SASS." Further, it was found that witnesses generally placed reliance on the Joint Working Party recommendations and their understanding that they would receive equivalent benefits to SASS and would be no be worse off. 16The primary judge also found the level of understanding of superannuation schemes was not high amongst employees, union representatives or managers and that: [T]he documents circulated [amongst employees] contained no direct warnings about the assumptions and the volatility of the investment market - there was no warning that there could be winners and losers as part of the assumptions used in the documents circulated. There was no warning that the proposed accumulation scheme could not guarantee equivalence of benefits. 17At [152]-[233] his Honour addressed the expert evidence. There were two experts, Mr John Rawsthorne an actuary who gave evidence for the respondent, and Mr Michael Murphy, another actuary who gave evidence for the appellant. 18An issue arose in relation to an aspect of Mr Rawsthorne's opinions and calculations insofar as they were said to be deficient in not disclosing his reasoning. Mr Rawsthorne had identified two areas of loss as a consequence of the shift from SASS to the PKCT scheme, namely, "loss of the pension option" (the PKCT Fund did not provide for a pension option) and the "transfer of investment risk issue" (that is, under a defined benefit scheme such as SASS the employer bore the investment risk, but under an accumulation scheme such as the PKCT Fund that risk was transferred to the employee). 19Haylen J noted at [234] that PKCT's primary position regarding Mr Rawsthorne's evidence was that the totality of it should be rejected because it was alleged that he had not stated his reasoning for important conclusions he had drawn about the inadequacy of the PKCT Fund. 20PKCT's objection to Mr Rawsthorne's evidence (and repeated on appeal) was that the two items identified by Mr Rawsthorne as areas of loss as between the PKCT Fund and the SASS scheme were identified in all the reports which were advanced in the proceedings in evidence by the CFMEU. However, two earlier reports prepared by Mr Rawsthorne, which were not advanced as evidence by the CFMEU and which preceded all of the tendered reports by Mr Rawsthorne, identified a range of advantages of the PKCT Fund over the SASS scheme, which then disappeared from the later reports that were relied on by the CFMEU as expert evidence. 21Mr Rawsthorne was subject to extensive cross-examination in respect of the absence from the tendered reports of any reference to the substantial items of advantage in the PKCT Fund over the SASS scheme. He was also challenged as to why he had not explained in the tendered reports how he had dealt with (if he had), and discarded, the benefits of the PKCT scheme identified in the un-tendered reports. 22The primary judge dealt with the issue at [240]-[243]: [240] In cross-examination, however, Mr Rawsthorne accepted that he had not exposed his reasoning and calculations in specifically valuing each of the areas of loss compared with each of the areas of gain under the PKCT system. He accepted that it would have been preferable had he done so but at the same time, he stated that he had looked at these matters in a general way and adopting a swings and roundabouts approach, these features of loss and gain had balanced themselves out to the extent there were two clear areas of loss, namely, the loss of the pension option and the potential loss flowing from employees taking up the investment risk under an accumulation fund. Mercer's working documents showed that these two items had not been explicitly taken into account in valuing the SASS scheme and Mr Murphy agreed with that analysis. [241] During cross-examination, Mr Rawsthorne pointed out that his first report did not simply identify investment risk and lack of pension as deficiencies in the PKCT fund, the right to contribute or the right to receive contributions, saying there were "other things as well." He stated that his intention in that report was to identify several areas where things were taken away, not just the two areas of lack of pension and transfer of investment risk but acknowledged that there were some areas where things were "improved." He then stated: ... After consideration of all of that, we were left with two issues, after consideration of all of that." [242] During the course of his evidence, Mr Rawsthorne said he considered all benefits in the two funds and by and large they cancelled each other out, except for the two identified areas that had not been compensated for in the PKCT scheme. Under cross-examination, in another part of his evidence, Mr Rawsthorne said that in his first report he had identified an offsetting feature of more than one year's salary for those in their 20s and under 30 who would benefit under the PKCT scheme by up to or more than one year's salary, but again stated that "a whole lot of matters" had to be considered and he, nevertheless, ended up with two heads of loss after everything had been considered. These two issues were left after what he described as his "swings and roundabouts approach." [243] When later pressed that his first report had identified a "very significant offset" of up to one year of salary, Mr Rawsthorne stated that he would not describe that as significant in actuarial terms and it was quite a bit less than that when taking into account the probabilities of exiting the fund early and all the other circumstances where such employees would not end up with one year of salary.... 23Ultimately, whilst he was unable to agree that Mr Rawsthorne's reports were inadmissible, his Honour declined to accept Mr Rawsthorne's expert evidence as to the quantification of the value of the 'pension option' and the 'transfer of investment risk'. At [252] Haylen J stated: [252] Viewed against that background, the Court is unable to agree that Mr Rawsthorne's reports, as a whole, are inadmissible. Mr Rawsthorne's detailed reports and the flow of discussion backwards and forwards through Mr Murphy's reports provide a great deal of information about the operation of these two superannuation funds and how their equivalence or lack of equivalence might be gauged. As already noted, senior counsel for the respondent accepted that it might well be open to accept Mr Rawsthorne's evidence, but not his assessment as to losses said to be suffered by employees in transferring to the PKCT fund. As will become clear in the concluding paragraphs of this judgment, while the Court has been assisted by the experts' reports, it has found neither conclusion appropriate in exercising the jurisdiction under s 106 of the Act in determining the fairness of the superannuation arrangements, nor in coming to a conclusion in applying s 106(5) in arriving at a money order that is just in all the circumstances of the case. 24However, and this goes to the heart of the appellant's objection to Mr Rawsthorne's evidence, the primary judge was prepared to allow the opinion of Mr Rawsthorne to underpin a conclusion that the 'loss of the pension option' and the 'transfer of investment risk' were deficiencies in the PKCT scheme compared to the SASS scheme and accordingly gave rise to an unfairness. At [253] and [350] his Honour stated: [253] Having regard to the evidence of both experts concerning the complexity of the valuing and comparison exercise, it appears to be common ground that one acceptable method of valuation would be to consider the SASS scheme in an overall, general manner and then, in a general way, assess whether the PKCT fund was as good as or, worse than the SASS fund. Both experts, at times, adopted this approach. Mr Rawsthorne looked closely at the SASS scheme (contrary to the respondent's submission) and indicated a number of losses and few gains: in this sense, he disclosed the facts and assumptions upon which he formed his view as to losses arising in the PKCT fund. In doing so, he exercised his knowledge and experience as an expert. Ultimately, the Court cannot conclude that, Mr Rawsthorne's views, formed in general, are inadmissible: in particular, Mr Rawsthorne was entitled to express the view that, after consideration of the elements of both schemes, there were primarily two areas of loss. Significantly, Mr Murphy expressed the broad view that once an accumulation fund was chosen for the new scheme, it was impossible to ensure equivalent benefits to SASS for new employees: there would be winners and losers. ... [350] There are, nevertheless, aspects of Mr Rawsthorne's approach that the Court would accept as appropriate in assessing the money order that should be made. In the Court's view, although criticised by Mr Murphy, Mr Rawsthorne was correct to approach the task by having regard to the representation made by PKCT that the new scheme would be of equivalent value to benefits available to employees under SASS. Although both experts, at different times, accepted that the complexity of the task was such that an overall or averaging approach was appropriate, Mr Rawsthorne was correct in not ignoring relatively small losses associated with certain benefits that had not been replicated in the PKCT fund. In applying the wider concepts of fairness, it was unfair that no explicit or any other consideration was given to the loss of the pension option or, to the passing of the investment risk from the employer to the employee. The importance of these two issues is that the evidence supports Mr Rawsthorne's conclusion that these matters were not taken into account by Mercer in designing the new fund. It is also significant that Mr Murphy accepted that these two matters were not explicitly taken into account on any consideration of the working papers made available by Mercer. The evidence supports Mr Rawsthorne's opinion that no consideration was given to these two elements in setting the design of the new superannuation scheme. 25In relation to Mr Murphy's evidence the primary judge described the various disagreements between the two experts, Mr Murphy and Mr Rawsthorne (see, for instance [188]-[189], [195]-[206]). His Honour also drew the following matters from Mr Murphy's evidence: [246] In cross-examination, Mr Murphy agreed that if there was a SASS benefit that had not been considered by Mercer, then Mercer had not provided a scheme consistent with the objective for its design as required by the consortium, namely, that it deliver equivalent benefits to SASS. He agreed that a necessary step to attain equivalence of value in the new scheme meant that Mercer had to identify each benefit in the SASS scheme and provide it with a value. He also agreed that if Mercer did not take into account at all any particular benefit available in SASS, then it could not have fulfilled the objective of providing equivalent benefits. Similarly, if a benefit under SASS was under-valued, the objective of equivalence would not be met. ... [248] In Mr Murphy's approach, there was considerable flexibility in the term "equivalent benefits" under SASS. He regarded that term as open to a reasonably broad interpretation. The word "equivalent" could be interpreted in terms of benefits to a new member of SASS at the time, to existing members of SASS who joined in recent years, people who had joined from other funds with special benefits and those who had joined from other funds with special benefits, such as NFR pension members. There was also a question of whether it was equivalent for the totality of members, the number of employees who were there at the time of the change over or, equivalent benefits in respect of a new member of either fund. [249] In the exercise he conducted there were different schemes and there were two ways to look at it - either from the view of an individual member that no one could be worse off or, alternatively, looking at the scheme as a package. That package was of equivalent value for the group of members involved. Mr Murphy did not seek any instructions as to what was meant by the words "equivalent value." In his 2012 report, he addressed issues in the context that the instructions could potentially relate to seven different scenarios of what was meant by "equivalent." It was obvious to him that the instructions meant a package of benefits that was more broadly equivalent where there could be winners or losers, but not that any single member will be no worse off in any circumstances. [250] Mr Murphy accepted that the notion of winners and losers was a direct inference from the fact that the package of equivalent benefits was required and that this was to occur in an accumulation fund, rather than a defined benefit fund. Those circumstances meant "it was absolutely impossible for it to be no worse off for any member in any situation environment." ... [253]...Significantly, Mr Murphy expressed the broad view that once an accumulation fund was chosen for the new scheme, it was impossible to ensure equivalent benefits to SASS for new employees: there would be winners and losers. 26In his "Deliberation", the primary judge dealt with the issues in the proceedings under eight headings. The first of these was "Common threads in the evidence". Relevantly, his Honour identified these as follows: (1)At the time of the privatisation of the coal terminal there were many industrial disputes and industrial action taken by unions with members at the terminal. (at [254]) (2)Almost all employees were contributors to the SASS fund, with some having a background of being contributors of up to two other public sector funds before merging or transferring to SASS (at [254]). (3)Superannuation was a "hot topic", but one of some complexity. (at [256]) (4)In proceedings before Hungerford J the FEDFA had drawn attention to the fact that employees had suffered a lot in the privatisation process and therefore any replacement superannuation scheme needed to contain benefits that were at least equal to SASS benefits. This was stated to be the primary issue in the dispute. (at [258]) (5)It was a common theme, regardless of the extent of recall, that reliance was placed upon the recommendation of the Joint Working Party and, therefore, employees voted to accept the scheme proposed in July 1990 as representing an equivalent scheme to SASS. (at [262]) (6)Witnesses for both the applicant and the respondent generally accepted that, in 1990, little was known about private or public sector superannuation. (at [263]) (7)Employee witnesses generally had little knowledge of the role of Bain & Co in advising the unions or the Joint Working Party in relation to the proposed new PKCT superannuation scheme. Bain & Co had been engaged by the FEDFA. It appears from the evidence that the FEDFA took a leading role in the superannuation issue, especially in notifying the dispute to the Industrial Commission and then engaging Bain & Co. (at [265]) (8)It was a common theme that employees found the issue of superannuation complex and ultimately relied upon the recommendation of the Joint Working Party and what they understood to be the effect of the superannuation arrangements for PKCT leaving them, overall, no worse off than if he had been able to remain in SASS. (at [267]) (9)Some witnesses understood that going into an accumulation superannuation fund meant that the returns could fluctuate depending on the money market movements - the investment could increase or decrease. Others understood that, by becoming a member of an accumulation fund, the investment risk was passed from the employer to the employee. Other witnesses understood that, although the schemes would be different, the outcome would be much the same. The result might be a compromise, but it would be as close as possible to SASS. (at [268]) (10)The employer was "trusted" to look after the employment arrangements for those taking up with PKCT. A number of witnesses understood, on the basis of documents distributed by the Joint Working Party, that depending on future investment returns, they might end up better or worse off compared with SASS. Despite this possibility, witnesses generally placed reliance on the Joint Working Party recommendations and their understanding that they would receive equivalent benefits to SASS and would be no be worse off. (at [269]) (11)The documents circulated contained no direct warnings about the assumptions and the volatility of the investment market - there was no warning that there could be winners and losers as part of the assumptions used in the documents circulated. There was no warning that the proposed accumulation scheme could not guarantee equivalence of benefits. Even Mr Coleman and Mr Dixon understood that the final scheme prepared by Mercer would not disadvantage employees when compared with SASS. (at [270]) 27Haylen J next dealt with "The Representation". His Honour's main findings were as follows: (1)[PKCT] accepted that the submissions made by its legal representative (Mr Bunting) in dispute proceedings before Hungerford J in 1990 were the extent of representations made publicly (and apparently at large) concerning the proposed new superannuation fund. In those submissions it was emphasised that the fund would not be the same as SASS because it would be an accumulation fund rather than a defined benefit fund and therefore, there would be differences. The two funds were not to be compared on a benefit-by-benefit assessment but in the round -the new fund would not be "less beneficial" than SASS. The intention of PKCT was said to be that, "taken in the round", it would not be less beneficial from the point of view of members. In saying that the new fund would be no less beneficial, the respondent was pointing out that it was not a matter of matching SASS "case-by-case" but the scheme would have to be looked at in a "global way." (at [273]) (2)In May 1990, Mercer recorded their instructions from the consortium in the following way: The consortium has two major objectives in the design of benefits: (a) benefits that are of equivalent value to those provided by SASS; and (b) simplicity of administration and communication. (at [274]) (3)The written instructions to Mercer do not appear to have been given to the union members of the Joint Working Party but their evidence was that it represented, in any event, their understanding not only of the purpose of PKCT but indeed, the purpose of the Joint Working Party. The Joint Working Party had been told of the instructions sent to Mercer. Mr Coleman accepted that if the scheme provided equivalent value to SASS then employees would not be any worse off. He accepted that employees were not to be disadvantaged by reason of moving from SASS to PKCT. Mr Coleman also confirmed that the Joint Working Party discussed providing a fund "with equivalent benefits" to SASS. (at [275], [276]) (4)Seven witnesses gave specific evidence relating to assurances they had received from management that they would be no worse off under the new superannuation scheme. (at [278]-[281] (5)The Court accepts the evidence of the individual witnesses who recounted Mr Coleman's presence at meetings or, who had discussions with Mr Coleman about the equivalent nature of the new superannuation scheme to the SASS scheme and the assurances that they would be no worse off. (at [286]) (6)Mr Dixon relied on Mercer to design a superannuation fund that met the needs and objectives of the members of the Joint Working Party; the purpose of the Joint Working Party was to come to an agreement regarding the structure of the new fund that was "acceptable" to all members of the Joint Working Party. The SASS fund was the "yardstick" for the design of the new superannuation scheme. He spoke of instructions being given to Mercer to design a superannuation fund with benefits "of equivalent value" as provided by SASS: the new fund was to be administratively easy because there were difficulties with different funds then operating at the coal terminal. (at [287]) (7)Mr Beale understood that PKCT had engaged Mercer to advise on the design and establishment of the new superannuation fund and that the intention of PKCT was to create a scheme providing benefits equivalent to those available in SASS as long as the fund was an accumulation fund. (at [292]) (8)The discussions at Joint Working Party level proceeded from at least May 1990 on the instructions given to Mercer by PKCT management, namely, that there were two objectives, firstly, that benefits were to be of equal value to those provided by SASS and secondly, there should be simplicity of administration and communication. There was never any suggestion in the evidence of PKCT management witnesses that the need for simplicity of the administration of the scheme and communication would impact in any way on the first objective of equivalent SASS value to be provided in the new superannuation fund: nor was it suggested that "simplicity" would compromise the final form of the scheme so that it would no longer be "equivalent" to SASS or that there could be winners and losers. (at [293]) (9)At all relevant times the objective was to create a superannuation fund providing benefits equivalent to that provided under SASS. (at [294]) (10)PKCT represented to potential employees of the privatised operation that if they took up employment with the new entity, the new superannuation scheme would provide equivalent benefits to the SASS scheme even though it would be an accumulation scheme rather than a defined benefits scheme. The employees would be no worse off under this new superannuation fund. (at [295]) (11)The Court is unable to accept [PKCT's] submission that the relevant representation was only that made by Mr Bunting in the dispute proceedings heard by Hungerford J in May 1990. Although similar to the objective identified by PKCT management of providing equivalent benefits to those provided by SASS, the Bunting representation introduced concepts of overall benefits "in the round" and would not provide a line-by-line equivalent. There was no PKCT or Joint Working Party document provided to employees stating that "in the round" the new fund would be no less beneficial, yet there might be winners and losers. Similarly, there was no statement in these documents that only some of the workforce would benefit. It was the workforce as a whole that would not be "disadvantaged." (at [296]) (12)The objective adopted by PKCT was to have Mercer design "benefits that are of equivalent value to those provided by SASS" The word "equivalent" relevantly means, "equal in value". (at [298]) (13)No reason was ever proffered as to why a pension such as available in SASS could not have been provided in the PKCT fund. The objective focused not only on equivalent benefits, but also the "value" of such benefits. If there was some understandable reason for not making the pension available then some other benefit of equal value had to be included in the new fund. The same approach applies to the transfer of investment risk: here, there was no option because of the nature of an accumulation fund. In this circumstance, Mercer had to value the lost stability of a defined benefits fund with the known certainty of its benefits at retirement and provide an equivalent benefit in the PKCT fund. (at [299]) 28The third area addressed by the primary judge was "Relative Bargaining Strength". His Honour concluded at [309]: [309] In the circumstances of this case it would be not be appropriate or fair that relief be withheld from the employees because they had some level of expert assistance and union representation prior to accepting the scheme offered by PKCT. The experts' evidence in this case demonstrates the complexity of the task of matching benefits under different superannuation schemes. The employees were entitled to rely upon the respondent's representation that they would be provided with benefits equivalent to SASS and that they would be no worse off. 29The fourth area dealt with by the primary judge was "Superannuation and the industrial context". His Honour concluded at [313]: [313]...The industrial volatility existing at the coal terminal by July/August 1990 undoubtedly influenced PKCT to offer a scheme equivalent to SASS where employees would be no worse off - anything less than that would have been likely to court further industrial unrest and employee dissatisfaction. 30The fifth area dealt with was "Other Issues". Here the primary judge refused to apply the principle of laches as sought by the appellant. His Honour also addressed a "cross-claim" by the appellant that if any finding of unfairness was to be made resulting from the communications to the membership, then the primary responsibility for those communications rested with Mr Cram who acted with the ostensible authority of the FEDFA to which the CFMEU is the legal successor. His Honour found (at [328]) that Mr Cram was doing no more than passing on to the workforce what the management members of the Joint Working Party expected him to do. Having reached that conclusion, there was no basis for the cross-claim. 31The sixth area addressed by the primary judge was whether a money order was appropriate under s 106(5) of the IR Act. In commencing his consideration, Haylen J made the following finding (at [330]): [330]... [T]he Court determines that the contract (in its widest meaning) was unfair, both in its inception and the way in which it worked out. From the time it was decided by PKCT that the new scheme would be an accumulation fund, detailed consideration had to be given to the means by which the new fund could provide benefits equivalent to SASS. Mr Murphy thought it was nearly impossible to do so under a strict accumulation fund. PKCT proceeded with a scheme where there could be winners and losers, quite contrary to its representation. On the evidence, it is not possible to conclude that the representation "benefits equivalent to SASS" somehow became "there will be winners and losers." No management witness, in terms, says this occurred. The applicant's case as to unfairness is made out. 32After addressing relevant authorities confirming the wide discretion available under s 106(5), the primary judge gave his assessment of the competing expert evidence. Overall his Honour said he preferred the evidence of Mr Rawsthorne "as his assessment was framed in the context, not of a strict actuarial approach, but against the necessary background that the PKCT scheme had to provide equivalent benefits to those available under SASS" (at [347]). In relation to Mr Murphy's contribution, Haylen J stated (at [347]): [347] ...The most significant aspect of Mr Murphy's assessment, rendering it significantly less useful in the exercise of this unfair contracts jurisdiction, was his interpretation of the consortium's guiding objective that the new scheme would provide equivalent benefits to those available under SASS. Initially, Mr Murphy regarded that objective as being impossible to achieve because of the fundamental difference between the two schemes, with SASS being a defined benefit scheme and the PKCT fund being an accumulation scheme. He later modified that view to the extent that equivalence might be achieved by a very high rate of employer contribution that resulted in a number of employees being much better off than under SASS. Mr Murphy therefore approached his task, for the great majority of the exchanges between himself and Mr Rawsthorne, by analysing the schemes against a broader objective of ensuring that, in general, the group would get much the same benefit as under SASS but inevitably, there would be winners and losers. In the Court's view that approach was not justified, having regard to the findings it has made in relation to the nature of the representation and the particular circumstances in which that representation was made. 33His Honour then determined that he had "little confidence in adopting the entire propositions or final conclusions put forward by either of the experts" and that "ultimately, the Court must make its own determination on the issues of fairness and then make its own assessment on how to compensate for that unfairness" (at [348]). 34We referred earlier to the primary judge's acceptance at [350] of Mr Rawsthorne's approach. That approach was to have regard to the representation made by PKCT that the new scheme would be of equivalent value to benefits available to employees under SASS. Mr Rawsthorne concluded that Mercer did not give any consideration to the loss of the pension option, or to the passing of the investment risk from the employer to the employee. 35At [351], Haylen J observed that in 1990 the PKCT scheme could not provide the equivalent value of benefits under SASS unless the issue of the pension option was addressed. It could not, in fairness, be ignored. In relation to the transfer of investment risk, his Honour considered this caused detriment and although complex could not be ignored in designing the new fund. 36Haylen J then addressed a range of issues raised in the expert evidence demonstrating the complexity of the task involved in trying to ascertain the relative gains and losses under the two superannuation schemes. At [377] his Honour effectively concluded that he was unable to conduct his own exercise based on the actuarial evidence, but was placed in the position of having to mould a money order that was just in the circumstances of the case: [377] Against this background there were a number of issues (as discussed above) that arose concerning the approach of both experts, not only in relation to an actuarial assessment, but also in relation to what might be regarded as appropriate and fair when those questions arose in proceedings brought under s 106 of the Act. Those aspects of the experts' reports leaves the Court in the invidious position of being unable to wholly accept Mr Murphy's opinion that there are no losses, or to wholly accept Mr Rawsthorne's conclusion that there were losses for the group running in total into millions of dollars. It is, however, implicit in Mr Murphy's approach that the PKCT fund did not, at its inception, provide for equivalent benefits to SASS, or benefits of equivalent value. From the preceding analysis, the Court confirms its conclusion that the PKCT scheme, at both its inception and in its operation, did not provide benefits equivalent in value to SASS benefits. The defects identified in the PKCT scheme leads to the further conclusion that it is just in the circumstances of this case to make a money order to compensate for these defects. In performing this task, the nature of the numerous considerations, (together with the Court's view that in the calculation of each expert there were matters that should either be eliminated or significantly modified), unfortunately, does not allow the Court to simply conduct its own exercise based on the actuarial evidence, including some factors and excluding others relied upon by the experts. Fundamentally, the Court in this case is not engaged in an actuarial exercise but must mould a money order that is just in the circumstances of the case. 37At [378] the primary judge considered there were the two important considerations that impinged upon the exercise of the discretion in s 106(5) of the IR Act: The first is the seeming inability to now create an accumulation scheme that accurately reflects the defined benefit scheme available under SASS. The second important consideration is that the Court is constrained from making orders that would operate beyond 2006, thus, removing from consideration actual results (if available) demonstrating losses or gains after 2006. His Honour continued: In the peculiar circumstances of this case, there is merit at looking at the position at 1990 when the PKCT accumulation scheme was introduced and making some provision at that point which would address the deficiencies in the PKCT scheme. 38Haylen J then considered wage negotiations in 2004, where the parties attempted to resolve the perceived inadequacy of the superannuation arrangements under the PKCT scheme. The evidence was that those discussions resulted in an agreement between the negotiators that the issue could be totally resolved by a payment to employees of two weeks' salary for every year of service. However, the general manager of the terminal rejected the proposition. 39At [382]-[383] Haylen J explained the approach he intended to take to remedy the unfairness, which was effectively to take the 2004 negotiations as the starting point and make adjustments to ensure the resultant money order did not inadvertently impose an inappropriately larger burden upon the respondent. [382] The Court has accepted that there were at least two significant defects in the PKCT scheme by that new scheme failing to factor in, on an equivalent basis, the availability of a pension for a large number of employees and the transfer of investment risks from the employer to the employees. Other, but less significant, defects have also been identified. In the broad exercise of its jurisdiction to make a money order that is "just in all the circumstances of the case" it appears to the Court that the 2004 proposal is a relevant starting point. It appears prudent to the Court, in light of the very different and extensive evidence before it, that the 2004 proposal should be trimmed to ensure that the resultant money order does not inadvertently impose an inappropriately larger burden upon the respondent. [383] It must be borne in mind, however, that the difficulties addressed in this case primarily arose because of representations made to the employees that were difficult to meet in an accumulation fund. Having considered all those matters, the Court is of the view that the employees identified in this case should have their contracts varied to provide for the payment of a lump sum calculated by reference to their service between August 1990 and February 2004 at the rate of 1.25 weeks' salary for every completed year of service. That sum should be calculated at the salary payable to each individual as at February 2004 or, their salary at the last day of employment if they left work prior to that date. As discussed in [390], it is appropriate in this case that interest on that sum should be paid in accordance with the provisions of the Uniform Civil Procedure Act 2005 (sic) and the Rules made thereunder. 40The primary judge next dealt with consequential issues. His concern was that any order not directly or indirectly impinge upon awards made in either the Federal or State industrial jurisdictions. His Honour said this was avoided because the proposed orders were directed to the variation of contracts of employment as at 2004 (at [386]). The other issue arose out of the appellant's submission that it was difficult to understand the unfairness in relation to people who were not members of SASS. In that respect, his Honour stated at [389]: [389] ...The case was squarely based upon a representation that the superannuation benefits, available under the PKCT scheme, would be equivalent to benefits available under SASS and employees would be no worse off. SASS was known to be a generous public sector superannuation and defined benefit scheme. Those representations were clearly significant to all employees, not only those who were in SASS as they were looking to their future with PKCT. All the employees who gave evidence joined the PKCT scheme and therefore it appears clear that, whatever their past view as to superannuation or their personal circumstances in relation to affording contributions to a superannuation fund, they all joined the PKCT fund after the representation of equivalent benefits was made and widely discussed. Having regard to these matters, no issue of fairness to the respondent arises, nor can it be said to be inappropriate that these employees be subject to the same orders as the vast bulk of employees claiming compensation in these proceedings. 41The final issue dealt with by his Honour was costs and interest. The Court indicated it would hear further from the parties on costs and in relation to interest, stated at [391] it was: [J]ust in the circumstances of this case to award interest from the date of filing of the application in 2005 until the date of this judgment. Interest is to be calculated in accordance with the provisions of the Civil Procedure Act 2005 and the Uniform Civil Procedure Rules 2005. 42The orders made by his Honour were as follows: [392] The Court makes the following orders: (a) a declaration that the contracts of employment between Port Kembla Coal Terminal Ltd and the employees identified in the proceedings were unfair in failing to provide superannuation benefits equivalent in value to the benefits available under the provisions of the State Authorities Superannuation Scheme as at August1990; (b) the said contracts of employment are varied to include a provision that each employee shall be paid a lump sum calculated by reference to: (i) the salary payable to each employee at February 2004, or the salary payable on the last day of service if leaving employment prior to February 2004; (ii) the completed years of service performed between August 1990 and February 2004; (iii) the rate of 1.25 weeks of salary for each completed year of service with Port Kembla Coal Terminal Ltd. (c) the amounts payable pursuant to order (b) above shall be subject to the payment of interest calculated in accordance with the provisions of the Civil Procedure Act 2005 and the Uniform Civil Procedure Rules 2005 and apply to the period from 12 December 2005 (the date of filing) until the date of this judgment; (d) the matter will be relisted to deal with any submissions as to costs, or to deal with any unintended difficulty that may arise from the present form of the orders. 43The amount payable under his Honour's orders was $3.4 million plus costs. Issues on appeal 44There are 29 grounds of appeal in the Notice of Appeal. The appellant condensed these grounds of appeal to six categories of error arising from the primary judge's decision, namely: Error 1: Haylen J relied on a representation by PKCT which was not pleaded and was contrary to the evidence. Further, his Honour extrapolated that representation to require the PKCT fund to be identical to the SASS fund, or of equal value to each employee in respect of each line item again contrary to the evidence (the Representation Error). Error 2: Haylen J failed to give any, or any adequate, weight to the relative positions of the parties, the role of the joint PKCT union working party, the existence of independent professional accounting advice to the union and the role of the union in recommending the accumulation fund to its members as appropriate. This error, together with the Representation Error, led to the failure by his Honour to correctly address the cross claim against the union (the Working Party Error). Error 3: Haylen J made a finding of unfairness in the contract without any analysis of whether the individual claimants were actually worse off under the PKCT scheme than they would have been under the SASS scheme and with no account of how they were better off under the PKCT Scheme (the Failure to Find any Employee was Worse Off). Error 4: Haylen J failed to properly deal with the expert evidence in the proceedings (the Expert Evidence Error): (a) by failing to exclude the evidence of Rawsthorne in circumstances where it did not comply with the Expert Code of Conduct and did not comply with the Makita principles; (b) by relying on that evidence for the purposes of making findings of unfairness ; and (c) by failing to have regard to the uncontradicted of Murphy that the employees in question were better off overall under PKCT than they would have been under SASS. Error 5: Haylen J made an order for compensation under s106(5) of the Industrial Relations Act 1996 (NSW) (IR Act) which was not rationally connected to the unfairness found by him to exist; did not address any found injustice; was outside the pleaded case; and was not raised with the parties for the purposes of inviting submissions addressing the approach (the Compensation Error). Error 6: In making orders (a) and (b), Haylen J made orders determining that the contracts of employment between PKCT and the employees were unfair in relation to the provision of superannuation, and orders varying the contracts of the employees from the date of the order related to the finding of unfairness in the superannuation arrangements of employees. These orders involved the impermissible exercise of jurisdiction to interfere with obligations imposed on PKCT by the Federal instruments in respect of superannuation existing after 26 March 2006 (the Jurisdictional Error). Leave to appeal 45We propose to grant leave to appeal. The appeal raises, inter alia, the questions of whether the primary judge fundamentally mistook the nature of the representation made by PKCT as to the benefits to be available under its superannuation scheme and whether his Honour applied an appropriate standard of advantage and disadvantage in assessing the relative bargaining strengths of the parties: see A&M Thompson Pty Ltd v Total Australia [1980] 2 NSWLR 1 at 13. 46The appeal also raises the important question as to whether a report prepared by a person who was qualified as an expert in relation to other reports, but not the report in question could be treated as expert evidence notwithstanding it was not tendered as such. 47In our opinion, the matter is of such importance that, in the public interest, leave should be granted. Consideration Representation error 48The respondent's pleaded case, so far as to concerned representations, was that set out in [8] of the Second Further Amended Summons for Relief, where the respondent averred: At the time the Members were offered employment with the Respondent they were assured that the entitlements under the new superannuation scheme that was to be established by the Respondent would be at least equal to what they had under SASS. 49Counsel for the CFMEU at first instance explained the basis of the respondent's claim regarding equivalent entitlements in his reply submissions: The PKCTWS mischaracterises the CFMEU case by suggesting that the CFMEU invites a 'line by line' comparison between the SASS and PKCT superannuation schemes to determine equivalence or otherwise. This is wrong. At all times the CFMEU has maintained... the position that what was promised by PKCT through its lawyer, Mr Bunting, and repeated by Mercers... and then again repeated many times by others on behalf of PKCT about the PKCT scheme was that it would have benefits 'equivalent in value' to SASS. The CFMEU case is that promise has not been delivered upon as there was nothing in the PKCT scheme that compensated employees for the loss of valuable benefits to be found in the SASS scheme, namely the right to elect to take a pension and the security of a known and identified investment return that was not ever at risk. In order to make out that case a line-by-line comparison is not required. 50Counsel then in his submissions referred to Mr Rawsthorne's evidence that the pension option was removed with no apparent compensation and no apparent compensation was provided for the transfer of investment risk from employer to employee and continued: ...Mr Rawsthorne... was saying there was nothing given in return that he could see for these things in the PKCT scheme - that is they had not been taken into account.... The matters could not on any view have been the subject of 'equalling out' if they were neither recognised nor brought into account in 1990. If no value was attributed to them... there could be no benefit equivalence between the two funds. 51The contention was, based on Mr Rawsthorne's evidence that the PKCT scheme did not compensate for the loss of pension option and transfer of the investment risk the employees were worse off and, therefore, the scheme could not be regarded as providing benefits equivalent in value to the SASS scheme. 52In submitting it was not advocating a line-by-line comparison we understood the CFMEU's position to be that it was not advocating that there had to be equivalent "lines" in the PKCT scheme for pension and transfer of investment risk. Rather, the respondent's position was that: (1)PKCT represented to employees that the PKCT scheme would be 'equivalent in value' to the SASS fund; (2)SASS provided for a pension option; (3)the shift from a defined benefit fund (SASS) to an accumulation fund (PKCT) meant that the risk associated with investment returns transferred from the employer to the employees; (4)in constructing the PKCT scheme neither a pension option nor compensation for the loss of such an option was included in the scheme, nor was there any element of compensation for the transfer of the investment risk to members of the Fund; (5)it must follow the PKCT Fund was not equivalent in value to the SASS fund; and (6)therefore, employees transferring from the SASS fund to the PKCT Fund were worse off. 53It will be noticed there was a subtle shift in the respondent's initial position, apparently required because of the evidence or a realisation that it would be difficult to strictly maintain its initial position. The shift was from one of a claim in the second further amended summons for relief of an assurance having been given that the entitlements under the new superannuation scheme that was to be established by PKCT would be at least equal to what they had been under SASS, to one of a promise having been given that benefits under the PKCT scheme would be equivalent in value to those provided by SASS. 54For entitlements to be "at least equal" they would need to match or be either not less nor greater than those the subject of comparison, with it being left open (by the words "at least") for the entitlements to be greater than equal. This is akin to the "line-by-line" approach. For benefits to be "equivalent in value" implies the need for some assessment to be made of the comparative value of the benefits in order to determine whether the benefits are equal in value as distinct from being benefits that match. 55Thus, it is the "value" of the benefits under the respective schemes that needed to be compared in order to determine whether there is equivalence, not a comparison of the benefits themselves, which may be different. 56The CFMEU was relying, amongst others, on representations made by Mr Bunting before Hungerford J in May and June 1990 and "then again repeated many times by others on behalf of PKCT" that there would be equivalence of value. Mr Bunting stated on 28 May 1990: The fund is most unlikely to be the same so it won't be equal in that sense and people should not have any misunderstanding of that. It will be of the same benefit. On the job people thought it had to be the same or equal in each respect. Taking it in the round it will not be less beneficial. As long as it is understood it is an overall assessment of it not a benefit by benefit assessment of it we are happy to give that indication. We expect it will be different in a number of respects from the existing fund. We expect it will be an accumulation style whereas the present is a defined benefits fund. It will be considerably more simple than the existing arrangements and much more readily understandable from the point of view of members than present arrangements so there will be differences but our intention is that it will be taken in the round not less beneficial from the point of view of members. 57On 13 June 1990, Mr Bunting stated again: We wish ... to remind Mr O'Connor [for the FEDFA] that on the last occasion when we gave an indication of the style of the fund that it would be no less beneficial, that was expressly on the basis that taken in the round it would not be any less beneficial and we do not want to be in a position of having to match SASS case by case. It has to be looked at in a global way... 58It is clear from what Mr Bunting said in proceedings before a Judge of the Commission, and from later representations by managers of PKCT, that the new scheme would be an accumulation style fund, not a defined benefit scheme such as SASS; it would be "considerably more simple than the existing arrangements and much more readily understandable... and there will be differences". It is also clear from the representations that the new scheme would be no less beneficial than SASS. But there was a caveat by Mr Bunting placed on the assurance that the new scheme would be no less beneficial and which the appellant relies heavily upon. That caveat was that the benefits under new scheme had to be assessed in a "global way", or in an "overall" sense", or "taken in the round". The new scheme was not to be assessed on a "benefit by benefit" basis, it was not intended to be the "same or equal in each respect" and it would not "match SASS case by case". 59Here lies the essential difference between the parties as to the nature of the representation made by PKCT. The appellant contended that the representation was to the effect that PKCT would provide a superannuation scheme of an accumulation type that overall delivered, as near as possible given the fundamentally different nature of the scheme, retirement benefits not less beneficial than SASS. It was submitted this was not a representation that no employee would be worse off because it was made clear the benefits had to be assessed in a "global way" or "in the round" due to the fundamental differences between the types of schemes. Whilst members of the new fund as a whole would not be disadvantaged, no assurance could be given or was given that individuals would not be worse off. 60The CFMEU contended that the representation was to the effect that the new scheme would provide benefits to members equivalent in value to SASS. This was understood by employees to mean no employee would be worse off and PKCT could not have misunderstood that this was the way the representation was received and did nothing to disabuse employees of that notion. Indeed, it was submitted the evidence showed that PKCT managers informed employees variously they would "not be disadvantaged", the new scheme would be "as good as", "at least as good as" or "as good as, if not better" than SASS. 61As it will have been seen from the summary of the first instance judgment, the primary judge found in favour of the CFMEU's submissions. That is, PKCT had represented to the employees in 1990 the benefits of the PKCT scheme would be equivalent in value to SASS and that no employee would lose, or be disadvantaged, or be worse off, as a consequence of transferring from SASS to the PKCT Fund. 62The issue is whether it was reasonably open on the evidence for the primary judge to make the finding, on the balance of probabilities, that he did regarding the representation. 63In addressing that issue we should commence by considering the difference between a representation contended for by PKCT that it would provide a superannuation scheme that overall delivered, as near as possible given the fundamentally different nature of the scheme, retirement benefits not less beneficial than SASS, and a representation contended for by the CFMEU that the new scheme would provide benefits to members equivalent in value to SASS. After that we shall deal with the question of whether the representation extended to the proposition that no individual employee would be worse off. 64It will be recalled the CFMEU eschewed any suggestion it was contending that its case involved a line-by-line comparison of benefits. Its position was that because the PKCT scheme did not provide for loss of pension, or compensation in that respect, or compensation for transfer of the investment risk, the scheme could not be said to provide benefits equivalent in value to SASS. Ipso facto, in our opinion, if the PKCT scheme had included adequate compensation for these two items in some form or another, which offset the loss in value caused by the absence of these two items in the PKCT scheme, this would have provided benefits equivalent in value to SASS. 65The appellant's case was that even if one accepted the pension option was not included in the PKCT Fund and no compensation was provided for transfer of investment risk (noting the appellant the contended there was no proper actuarial basis for this item to be given any value at all), because of other benefits included in the PKCT Fund that were not present in SASS the employees, as a group overall, were far better off in all circumstances under the PKCT Fund than they would have been had they remained in SASS. That is, not only did the PKCT scheme provide benefits equivalent in value to SASS, it exceeded them. 66Approached in this way, it may be seen the difference in the parties' view of the representation is of little practical significance except in relation to the issue of individuals being worse off. 67It is worth noting the significance of this difference between the parties as to whether the representation included an assurance that individual employees would not be worse off. It would seem that if the appellant's view of the representation was to be accepted, namely, it was only "in the round", or in a "global way", or "overall" that the PKCT scheme was to be compared to SASS, then if such a comparison showed the PKCT scheme to be no less beneficial, there could be no unfairness arising out of a misrepresentation. 68On the other hand, if the representation included an assurance that individual employees would not be worse off and it was found that some employees were worse off, then regardless of the outcome of the overall comparison, a finding of unfairness might be made on the basis that PKCT had misrepresented the benefits to be available under its superannuation scheme. This is the conclusion the primary judge reached. 69The evidence that individual employees had received direct assurances from management that they would be no worse off under the new superannuation scheme seems to have been limited to seven employees: see [278]. Taken at its highest, and noting that Mr Coleman who was said to have given the assurances denied having done so, this evidence could only provide the basis for a finding of unfairness in relation to those seven employees for the reason that they were worse off.. 70However, this was not the only evidence relied upon by his Honour. A good deal of it related to recollections of employees as to what was told to them by Mr Cram, the FEDFA delegate who played a leading role on behalf of all employees in the superannuation dispute and, who it was asserted, told meetings of employees they would not be "financially worse off" by leaving SASS, or that the new fund was to be "equally as good as the old fund, if not better." Other meetings addressed by unnamed delegates were alleged to have stated employees could not stay in SASS, but PKCT was "guaranteeing workers" that they would not be "disadvantaged" financially if they went into the new scheme (noting it was also said that the new scheme would not be "exactly the same as SASS" but as close as possible to SASS). At another union meeting one union representative was alleged to have said employees would have "an equal superannuation scheme to SASS" and that they would "not be disadvantaged". 71Mr Atkin and Mr Cram addressed the employees at a mass meeting in the"big crib room", telling them that they could not stay in SASS but saying that they would not lose any benefits and that on retirement, they would be "no worse off" than if they had remained in SASS. At an earlier meeting of delegates, it was alleged several members of management were present and in particular, Mr Coleman and Mr Tonnini. When the delegates reported that employers would be "no worse off" under the new scheme, that statement was not challenged by management. Mr Cram and Mr Bell addressed the employees at a mass meeting in the "quadrangle" with Mr Cram saying "everything would stay the same and that their superannuation would just flow into a different fund"; nothing would change, there would be no disadvantage to changing superannuation schemes. 72The first matter to note about this evidence, and which tends to weaken its reliability notwithstanding what the primary judge regarded as "common threads", is that witnesses were asked to recall what was said over 20 years ago. The second and closely related consideration is that there is no yawning gulf between a representation, on the one hand, that retirement benefits under an accumulation scheme would not be less beneficial "overall", or assessed in a "global way", or "in the round" than benefits under SASS and, on the other hand, a representation that employees would not be disadvantaged or no worse off. The message about what was being represented could easily have been lost in the translation either at the time or later. 73The third thing to note about the evidence for the CFMEU is that most of what employees heard about PKCT's position regarding a new superannuation scheme came from Mr Cram when he addressed meetings of employees. Mr Cram was not called to give evidence in the proceedings and no explanation was offered as to why he was not called. It would have been useful to know, first hand, how Mr Cram formed such views as: "benefits will remain the same, including superannuation"; PKCT would "make sure that the new superannuation scheme" would be as good as the one that they were leaving"; and that PKCT had given an undertaking that employees would be "no worse off" under the new scheme. Mr Cram was present on 28 May 1990 in the proceedings before Hungerford J when Mr Bunting advised the Commission: The fund is most unlikely to be the same so it won't be equal in that sense and people should not have any misunderstanding of that. It will be of the same benefit. On the job people thought it had to be the same or equal in each respect. Taking it in the round it will not be less beneficial. As long as it is understood it is an overall assessment of it not a benefit by benefit assessment of it we are happy to give that indication. Mr Cram took no objection to that statement. The position of Mr Cram's colleague, Mr O'Connor, in the proceedings before Hungerford J was that the PKCT scheme should provide "... benefits in the broad sense which are at least equal to what the employees are presently receiving under SASS". 74The primary judge did not only rely on the evidence of employee witnesses, but also evidence from union representatives, management representatives of the Joint Working Party, other managers, documentary evidence and, of course the evidence of expert witnesses. Critically, however, the primary judge discounted to a very significant degree the evidence regarding Mr Bunting's representations before Hungerford J in May and June 1990 as to PKCT's intentions regarding a new superannuation scheme 75As we have noted, in the first instance proceedings the CFMEU embraced Mr Bunting's statements before Hungerford J in May 1990. It was not the case that his "not a benefit by benefit assessment", "in the round" and "overall" qualifications were later overturned by other statements from PKCT representatives. In fact, it was submitted by the respondent at first instance that what Mr Bunting had promised on behalf of PKCT was repeated by PKCT representatives. In those circumstances, there was no proper basis for the primary judge's questioning of Mr Bunting's instructions at [296]. PKCT had not been put on notice that Mr Bunting's instructions would be an issue. If it had been it may have called Mr Bunting to confirm that he was in fact acting on instructions. As it was, the CFMEU at first instance accepted Mr Bunting's statements as reflecting his instructions. 76The evidence regarding what Mr Bunting said on transcript in proceedings before Hungerford J should have carried much greater weight with the primary judge than it did. We agree with the appellant's submission that: The effect of his Honour's decision (querying whether Mr Bunting had instructions) was to entirely remove this critical evidence from consideration for the purpose of considering the nature and extent of the representations found to be made by PKCT, and for the further purpose of considering questions of fairness. Not only was this evidence the most tangible evidence of PKCT's position (being reflected on transcript - and being sought to be provided on transcript) it is to be recorded that oral evidence otherwise relied on (reflecting a variety of recollections as to what was said) appeals to memory of events some 20 years beforehand. 77It is clear to us that Mr Bunting was attempting to explain PKCT's position as being an intention to construct an accumulation scheme that would, broadly speaking, or in a global way, or overall, be not less beneficial than the SASS scheme. It is apparent Mr Bunting was attempting to make it clear PKCT was not intending to match SASS on a case-by-case basis. The CFMEU accepted Mr Bunting's representation. Moreover, as his Honour found at [291] "... it is also likely that Mr Bunting's announcement in the dispute proceedings before Hungerford J came to be discussed initially by FEDFA members and then passed on to other employees by word of mouth, but perhaps by not using precisely the same words used by Mr Bunting." 78Mr O'Connor, who appeared for the FEDFA before Hungerford J in May 1990, stated his Union's position as being that "...any superannuation scheme that is proposed by the consortium have benefits in the broad sense which are at least equal to what the employees are presently receiving under SASS" (our emphasis). Mr O'Connor was there proposing a broad approach to the equivalent benefits issue, not unlike the approach explained by Mr Bunting. 79The evidence of employee representatives as a whole does not support a finding the PKCT represented that individual employees would not be worse off. Employee representatives in 1990 understood that as a consequence of the transfer from the SASS scheme to the PKCT scheme there would not be an equivalence of benefits for all employees. Mr Strudwick, an ETU site delegate, accepted in his evidence that "In the round, some [employees] would lose, some would gain." Mr Atkin, another ETU site delegate and member of the Joint Working Party, accepted that employees who retired at 60 under the PKCT scheme would be worse off financially than if they had remained in the SASS scheme. He accepted the transfer from one fund to the other had to be looked at in the round because the "funds were different". Mr Annesley, another member of the Joint Working Party, accepted that it was not possible to achieve identical results to SASS and some employees would get less. Mr Hooper, Operations Manager for PKCT, agreed that his position was not that no one would be worse off, and that some employees were "going to go backwards", but overall the outcome was "equitable". 80It is not surprising that these representatives and Mr Hooper accepted that what was on offer and ultimately accepted was a fund that did not deliver benefits to all employees that were equivalent to those provided in SASS. for the reasons that follow. 81PKCT's first offer of a new superannuation scheme (made on 7 June 1990) was rejected by the Joint Working Party and then rejected by the employees. The first offer was accompanied by tabular comparisons, which made it clear that the result would be significantly inferior to the position under SASS (some employees would be up to $30,000 worse off). On the other hand, the position of persons retiring earlier would be more beneficial. 82PKCT's final offer was the subject of the Joint Working Party recommendations in July 1990. The difference in retirement benefits at the upper end of the age scale between SASS and the proposed PKCT scheme was much narrower that the first offer, with some persons retiring at 60 only being about $4,000 worse off under the PKCT scheme (at the lower end, ie, where employees retired at a younger age, the benefits were significantly better under the PKCT scheme, which hardly supports "equivalence of value for all employees" being given a literal interpretation). Nevertheless, it was clear on the face of the documents provided to the Joint Working Party and to employees that PKCT was not offering a scheme that provided benefits of equivalent value to the SASS scheme in every respect. Despite this, the union representatives of the Joint Working Party recommended acceptance of the scheme and employees accepted the recommendation. 83Importantly, as Mr Murphy made clear in his evidence, as the types of funds were to be fundamentally different that made it "...absolutely impossible for it to be no worse off for any member in any situation environment" unless there was an exorbitant rate of contribution to address any deficiency. The purport of what Mr Murphy stated was that it was "absolutely impossible" to predict that members of the PKCT scheme would be no worse off in any environment driven by the investment market. That is to say, the state of the investment market at any given time may be such that members are worse off. But the state of that market may change, rendering members better off. We do not construe what Mr Murphy said to mean that because the PKCT scheme was an accumulation scheme, members would always be worse off than if they had remained in SASS, a defined benefit scheme. 84The employee representatives knew that the PKCT scheme and the SASS scheme were of fundamentally different types and did their best to explain the differences to members. They understood there was an investment risk associated with the accumulation scheme that was not present under a defined benefit scheme. Moreover, they knew that in recommending acceptance of the PKCT scheme to their members that the figures produced by PKCT and Mercer were only projections of possible future benefits and were reliant on assumptions as to interest rates and market rate returns into the future that could not be guaranteed. Mr Strudwick, for instance, agreed that no assumptions could be made about how the market might operate or what the future contributions might be. He said, "We didn't know what the future held". 85In support of its defence of the primary judge's findings regarding representation, the respondent relied on instructions from the consortium, confirmed by Mercer in writing on 22 May 1990, that the purpose of the PKCT Fund was to provide "benefits of equivalent value to those provided by SASS". The primary judge also relied heavily on this communication. The "benefits" referred to in Mercer's letter were "retirement benefits". 86As the primary judge observed at [275], the written instructions to Mercer did not appear to have been given to the union members of the Joint Working Party. Nor were they provided to employees. Accordingly, they could not be said to be any part of a representation by PKCT. However, the primary judge appears to have regarded the instructions as confirming PKCT's original intent: that no employee would be worse off; that there would be no losers. 87The instructions need to be considered in their proper context. First, Mercer's letter of 22 May 1990 also confirmed that the consortium's preference was for an accumulation fund and it was that type of fund that Mercer was developing. Union representatives took no objection to an accumulation fund nor did their advisor, Bain & Co. Noting the consortium's objectives of retirement benefits of equivalent value to those provided by SASS and "simplicity of administration and communication", Mercer's letter proceeded to outline the benefits available under the SASS scheme and what Mercer proposed by way of employer and employee contributions for a new accumulation fund to replace SASS. 88On 28 May 1990, Mr Bunting, representing the consortium before Hungerford J, indicated the consortium's desire to "have benefits in the broad sense which are at least equal to what employees are presently receiving under SASS". In the same proceedings Mr Bunting said: The fund is most unlikely to be the same so it won't be equal in that sense and people should not have any misunderstanding of that. It will be of the same benefit. On the job people thought it had to be the same or equal in each respect. Taking it in the round it will not be less beneficial. As long as it is understood it is an overall assessment of it not a benefit by benefit assessment of it we are happy to give that indication. We expect it will be different in a number of respects from the existing fund. We expect it will be an accumulation style whereas the present is a defined benefits fund. It will be considerably more simple than the existing arrangements and much more readily understandable from the point of view of members than present arrangements so there will be differences but our intention is that it will be taken in the round not less beneficial from the point of view of members. 89In a further letter from Mercer to Mr Hugh Morris (a company secretary from one of the member companies of the consortium, who Mr Coleman believed was responsible for the decision to engage Mercer) dated 4 June 1990, the advice attached comparison tables, which set out the results for various fund designs including the Kooragang Coal Loader, SASS, a PKCT scheme with a 6% contribution rate and a PKCT scheme with a 5% contribution rate. In doing so, Mercer commented that: Comparison between a defined benefit fund (eg SASS) and a defined contribution fund (eg KCL and PKCL funds) is made difficult by the fundamentally different nature of the funds. 90The first proposal from PKCT to the union members of the Joint Working Party produced a result in between the Kooragang Coal Loader (KCL) scheme (a comparable private sector enterprise) and SASS for new employees of PKCT. The relevant benefit comparison (omitting KCL) for a new entrant at age 34 may be illustrated from the following extract: Age at exit SASS PKCT 6% PKCT 5% $ $ T'man S'visor T'man S'visor T'man S'visor 49 25,894 36,633 64,181 90,799 55,196 78,087 54 41,865 59,228 90,175 127,574 77,551 109,714 58 118,106 167,091 112,905 159,730 97,098 137,368 60 127,949 181,014 124,963 176,789 107,468 152,039 91In a letter dated 6 June 1990 to Mr Kolln (superintendent of BHP industrial relations), Mercer provided revised comparisons, based on 5% contribution by members and 11.75% by PKCT, with 10% vesting for each of the first 10 years. Mercer's letter contained revised comparison tables. Those comparison tables were based on a long-term differential of 2% per annum between salary increases and investment returns during an employee's period of service. The following extract is in relation to a new entrant aged 35: Age at exit SASS PKCT T'man S'visor T'man S'visor $ $ $ $ 50 25,894 36,633 55,196 78,087 55 41,865 59,228 77,550 109,713 58 113,186 160,128 92,065 130,248 60 123,028 174,052 102,232 144,631 92A further Joint Working Party meeting was held on 7 June 1990. At this meeting, PKCT put its first proposal to the Joint Working Party regarding the PKCT Fund, including comparison tables of KCL, SASS and PKCT (the First PKCT Proposal). It was agreed that the unions were to seek advice from Bain & Co. 93The proposal was rejected by employees in early June 1990. On 13 June 1990, there was a further hearing before Hungerford J. At that hearing: (1)the Commission was told of the offer made on 7 June 1990 and that the FEDFA was seeking advice; (2)the FEDFA identified the concerns that Bain & Co had identified with the First PKCT Proposal; (3)Mr Bunting, on behalf of PKCT, clarified earlier comments regarding PKCT's approach. He emphasised that any comparison between the new fund and SASS was in the round and not on a line by line comparison or on an individual by individual basis; (4)the Commission was told of the advice from Mercer regarding issues raised by Working Party. 94On 13 June 1990, Mercer wrote to Mr Kolln responding to concerns raised by unions in the Joint Working Party, including a proposal for a flexible contribution rate. On 14 June 1990, a further Joint Working Party meeting took place. At that meeting: (1)the unions provided a description of a Bain & Co advice, which mirrored the issues raised in the Mercer letter of 13 June 1990; (2)the unions contended that the employee contribution should be from 5-10% at the election of the employee; (3)the unions suggested that the employer contribution should be 1.75 x employee's contributions; (4)the unions said that the advice of Bain & Co was that increasing the level of employee contributions (with corresponding employer contributions) to a maximum of 9% was the only way to equate the schemes; (5)The unions also identified the need to accommodate the needs of the older workforce, in the 55-60 year age group. 95On 21 June 1990, a further Joint Working Party meeting took place. At that meeting: (1)it was agreed that from age 52 - 58, employees would be able to elect to add 2% to their employee contributions matched by an additional 3.5% contribution by the Company (that is, "flexing up" was proposed to address the issue raised by the union concerning the position of older members of the scheme); (2) it was noted that the retrenchment benefit was still an issue for employees of short duration; (3)the union members of the Working Party claimed that the PKCT scheme is "not as good as the SASS provision"; (4)the unions were still looking for a flexible contribution, eg 5-10% employee contributions up to a matching 7.5% company contribution, or a higher flat percentage employer contribution, say 6% or 6.5%; (5)PKCT apparently agreed to "check with Mercers" about the 6% contribution rate. 96On 21 June 1990, Mercer wrote to Mr Dixon (finance manager) regarding the proposal that employees be able to contribute an additional 3% of salary, and the effect this would have on employer financed contributions. On 22 June 1990, Mercer further wrote to Mr Dixon, attaching amended benefit comparison projection tables, based on 6% employee contribution and 13.5% by PKCT with 10% vesting. On 29 June 1990, Mercer wrote to Mr Dixon with calculations of the additional employer contributions that would be required if employees contributed the maximum additional contributions using the 'flex-up' facility from age 52 to age 58. 97On 11 July 1990, the Joint Working Party issued a second statement advising that it was in a position to recommend the PKCT Fund. That second Joint Working Party statement confirmed that the union representatives of the Joint Working Party had received advice from Bain & Co (a firm endorsed by the ACTU). Messrs Annesley, Cram and Atkin signed the statement on behalf of the union representatives of the Joint Working Party. The union representatives of the Joint Working Party confirmed that they were in a position to recommend the proposed fund to the members. The statement also foreshadowed that a booklet would be sent out to employees to provide more details on the proposed fund for their consideration. On 20 July 1990, Mercer wrote to Mr Dixon providing a booklet/leaflet for distribution to members and foreshadowed preparation of the booklet. 98On 24 July 1990, the Joint Working Party issued its third position statement. That statement attached a booklet/leaflet, which set out in detail the features of the new fund together with comparison figures between the proposed PKCT scheme and SASS. The statement was signed by the union members of the Joint Working Party and recommended the proposed fund to employees. The attached booklet/leaflet identified "the main features" and said that a more detailed booklet was being prepared for distribution. 99By way of example, the proposal provided the following retirement benefit for a new entrant aged 35: Age at exit SASS PKCT T'man S'visor T'man S'visor $ $ $ $ 50 25,894 36,633 64,181 90,799 55 41,865 59,228 93,355 132,073 58 113,186 160,128 113,607 160,725 60 123,028 174,052 125,694 177,823 100In particular, the third statement contained a summary comparison of the new PKCT scheme with SASS, showing benefits at age of exit 45 through to 60 for a new employee joining the fund at the commencement of PKCT operations. Where the new entrant was aged 45, as we earlier observed, some employees were worse off under the PKCT scheme: Age at exit SASS PKCT T'man S'visor T'man S'visor $ $ $ $ 55 13,939 19,720 43,818 61,991 58 63,975 90,507 61,038 86,352 60 73,817 104,431 71,001 100,447 101In July and August 1990, the FEDFA took further advice from Bain & Co regarding provisions of a superannuation deed. Mercer was also involved in providing further advice to PKCT. 102On 3 August 1990, Mercer wrote to Mr Dixon outlining a timetable for commencement of the PKCT Fund. On 8 August 1990, the final version of the PKCT Fund Superannuation booklet was distributed to employees prior to their joining the PKCT Fund. On 9 August 1990, Mercer wrote to PKCT attaching a draft trust Deed. On 13 August 1990, the employees at the coal loader commenced their employment with PKCT. 103On 17 August 1990, the PKCT Fund was established. The trustees of the fund were half union and half management nominees and included Mr Beale, Mr Dixon, Mr Hooper, Mr Annesley, Mr Edward Coombes and Mr Matthew Faint. 104It may be seen from the foregoing sequence of events that: (1)From the outset, Mercer understood PKCT's preference was for an accumulation fund and it was that type of fund that Mercer proceeded to develop. Mercer noted the difficulty of comparing an accumulation fund with a defined benefit fund. No union representative voiced an objection to changing the nature of the superannuation scheme from a defined benefit type to an accumulation type. (2)The primary judge placed considerable reliance on the confirmation letter from Mercer to the consortium which stated an objective was to provide "benefits of equivalent value to those provided by SASS". His Honour appears to have taken the view that "benefits of equivalent value" meant that no employee was to lose or be worse off. (3)Mercer, itself, did not understand that the instruction from PKCT to design a fund that provided retirement benefits of equivalent value to those provided by SASS meant that no employee was to suffer loss. Mercer's original proposal produced a result in between the Kooragang Coal Loader scheme (a comparable private sector enterprise) and SASS for new employees of PKCT. The proposal involved substantial loss for those retiring at 58 or later, but substantially better outcomes for those who retired earlier. Those outcomes accorded with an understanding that the objective in moving to an accumulation fund was to provide retirement benefits of equivalent value in a global sense, and not in respect of every employee who became a member of the PKCT fund. (4)Mercer's understanding of the objective is consistent with what Mr Bunting stated before Hungerford J six days after the Mercer letter confirming its instructions as to the objectives. That is, "Taking it in the round it will not be less beneficial. As long as it is understood it is an overall assessment of it not a benefit by benefit assessment..." and "... there will be differences but our intention is that it will be taken in the round not less beneficial from the point of view of members." (5)There was no protest from any union representative, including the leading union representative Mr Cram, who was present on 28 May 1990, about the objective stated by Mr Bunting. Indeed, his colleague Mr O'Connor's position was that the PKCT scheme should provide "... benefits in the broad sense which are at least equal to what the employees are presently receiving under SASS". (6)It was reasonable to expect that Mr Bunting's representation would have been conveyed to employees. (7)Following rejection of PKCT's first proposal regarding a new fund a revised proposal was put that addressed, to a large extent, the differences in the payouts for those that retired at 58 or older. But the revised proposal did not deliver a retirement benefit to each employee that was equivalent to that available under SASS and that was apparent on the face of advice provided to employees by the Joint Working Party. (8)The union representatives of the Joint Working Party clearly understood that "benefits of equivalent value" did not mean each employee who joined the PKCT fund would receive a retirement benefit that was equal to what they would have received under SASS, but rather that overall there would be an equivalence of value, which meant that in Mr Atkin's words "some [employees] would lose, others would gain." (9)The union representatives also understood that the estimates of retirement benefits under the PKCT scheme were based on assumptions of salary and interest rate movements over the long term that could not be guaranteed. They also understood the investment risk shifted to the fund member. The union representatives conveyed this information to employees. (10)The revised proposal was recommended by the Joint Working Party for acceptance. Tables showing the retirement payouts for various entry and exit ages were provided to employees. The tables showed that any employee who joined the PKCT scheme at a relatively late age (eg, 45) and retired at 60 would be worse off than if retirement had occurred under SASS. (11)The revised proposal was put to employees and, on the recommendation of the Joint Working Party, was accepted. 105Our view is that in 1990 the employee representatives and their members were content with a superannuation scheme that, at the time, they understood broadly delivered benefits of equivalent value to those of the SASS scheme; that overall, as a body of members of the PKCT scheme, the employees would not be worse off. The representatives negotiated an arrangement that was "as close to SASS as we could get", but it did not guarantee equivalence for each and every employee and was not represented as such. 106The primary judge's finding at [295] that "employees would be no worse off under this new superannuation fund" and at [330] that it was "contrary to PKCT's representation that there would be winners and losers", are findings that the representation made by PKCT was that no employee would suffer loss in transferring from the SASS scheme to the PKCT scheme. When one considers all of the evidence objectively, those findings were not reasonably open. 107The message given by Mr Bunting in open proceedings before a judge of the Commission and not challenged by any union representative, was that the PKCT scheme would be no less beneficial looked at in a global way, but PKCT was not going to be placed in a position of having to match SASS case by case. Over time, it appears, that message may have lost something in the translation and became one of individual employees not being disadvantaged or worse off. That was not the fault of PKCT. 108Given the PKCT scheme was to be an accumulation type fund it should reasonably have been apparent to all concerned (and was apparent to the employees' representatives) that it was impossible for a guarantee or undertaking to have been given that no employee would be worse off under any circumstances in an environment driven by the investment market. The scheme that was put to employees for their acceptance was based on long term assumptions about salary and interest rate movements neither of which could be predicted within anything near absolute certainty. Union representatives understood this and explained, what is a relatively straightforward notion, to their members. 109Mr Beale did not recall PKCT ever providing any guarantee to employees that they would not be worse off. Mr Coleman gave similar evidence. Whilst Mr Coleman conceded that the aim or objective was to provide benefits of equivalent value, that was subject to the fact that PKCT, without objection, was introducing an accumulation scheme where returns on investment could not be guaranteed (and it followed neither could retirement payouts) and where the very structure of the scheme was fundamentally different to the defined benefit scheme that was SASS. 110We find that the primary judge erred in finding that PKCT had represented to the employees in 1990 that no employee would lose, or be disadvantaged, or be worse off, as a consequence of transferring from SASS to the PKCT Fund. 111This is not the end of the matter, however. Accepting, as we must on the evidence, that PKCT's representation was as Mr Bunting expressed it before Hungerford J in 1990 - that being a global or overall approach to the issue of equivalence - the question remains whether, on an overall assessment, PKCT provided benefits of equivalent value. 112The CFMEU contends that because the PKCT scheme did not provide for the pension option (or compensation in that respect) and there was no compensation incorporated in the scheme for the transfer of the investment risk to members, there was a net overall loss to members and, consequently, PKCT did not deliver on its representation. We shall deal with this issue later in the judgment in addressing whether there was any error by the primary judge in failing to assess any loss. Working Party error 113At [309] the primary judge held: [309] In the circumstances of this case it would be (sic) not be appropriate or fair that relief be withheld from the employees because they had some level of expert assistance and union representation prior to accepting the scheme offered by PKCT. The experts' evidence in this case demonstrates the complexity of the task of matching benefits under different superannuation schemes. The employees were entitled to rely upon the respondent's representation that they would be provided with benefits equivalent to SASS and that they would be no worse off. 114Nowhere in the primary judge's reasons did he expressly state that the contracts or arrangements were unfair because the employees were in a disadvantaged bargaining position. What his Honour said was that "it would not be appropriate or fair that relief be withheld from the employees because they had some level of expert assistance and union representation prior to accepting the scheme offered by PKCT." 115This was the conclusion reached in the context of addressing the appellant's submission at first instance that "this was not a case where there was such an inequality of bargaining strength between the parties that required intervention by the Court to address unfairness arising from that relationship." The primary judge addressed that submission under the heading "Relative Bargaining Strength". 116Despite the absence of an express finding, it is tolerably clear that his Honour concluded that the impugned contracts were unfair because the employees were at a disadvantage - that they were in an inferior bargaining position to PKCT - and, consequently, induced by PKCT's representations, became parties to contracts or arrangements, which resulted in retirement benefits for employees that were not equivalent in value to those enjoyed under SASS. Although he did not express it precisely in this way, according to the primary judge the inferior bargaining position of employees arose mainly from the fact that the notion of superannuation in 1990 was little understood and the task of comparing superannuation schemes was complex. Employees could not be expected to make their own assessment of what was in their best interests. Therefore, they were "entirely reliant" on others to assist them in acquiring an understanding and entitled to rely on assurances by PKCT they would be provided with benefits equivalent in value to SASS and that they would be no worse off. 117That his Honour was addressing the relative bargaining strength of the parties appears not only from the heading in the decision, but also that, after referring to several "factors", the primary judge further stated at [306]: [306] These factors make it difficult to conclude that the employees were well informed and accepted the new superannuation scheme with their eyes wide open, or to accept that there was such an equality of bargaining strength that it was not open to find that there was unfairness arising from the superannuation arrangements ultimately agreed to by the parties. 118His Honour arrived at this conclusion on the basis of the following considerations: (1)Mercer's reports were not routinely provided to the employee members of the Joint Working Party. (2)The extent of the assistance provided to the unions by Bain & Co was unclear. Union representatives from organisations, other than the FEDFA, could not recall being involved with Bain & Co. (3)Superannuation was not well understood in 1990 and the workforce was entirely reliant on others to provide assistance and information to help them in the difficult task of comparing different schemes of superannuation. (4)The complexity of the task of creating a scheme of equivalent value to SASS and to do so in a short time frame, fraught with industrial tension, left employees to be guided by the assurances that they would not be worse off. Employees could not realistically have been expected to conduct their own assessment of assumptions drafted by someone else on these highly technical issues. (5)The Court has over the years rejected a simplistic approach that placed relevant experience/full disclosure/legal advice as barring relief under unfair contract provisions. 119The test of unfairness under s 106 of the IR Act involves the commonsense approach characteristic of the ordinary juryman by applying standards providing a proper balance or division of advantage and disadvantage between the parties who have made the contract or arrangement, bearing in mind the conduct of the parties, their capability to appreciate the bargain they had made and their comparative bargaining positions when entering into the contract or arrangement: Davies v General Transport Development Pty Ltd [1967] AR (NSW) 371 at 374; A & M Thompson Pty Ltd v Total Australia Ltd [1980] 2 NSWLR 1 at 13; Baker v National Distribution Services Ltd (1993) 50 IR 254 at 270-271; Port Macquarie Golf Club v Stead (1996) 64 IR 53 at 59 and Kennedy v Martinez [2011] NSWIRComm 137 at [35]. 120It may be accepted that in 1990 superannuation was not a well understood concept by employers, employees or unions despite the emergence and steady expansion from about the mid-1980s of industry based superannuation schemes promoted by unions, particularly building industry unions, and some employer organisations. It may also be accepted that the decision of the State Government to privatise the coal terminal at Port Kembla created a good deal of concern amongst the workforce and was the catalyst for industrial disputation manifested by strike action at the coal terminal. 121There was particular concern about superannuation. It was recognised by employees that SASS (one of several superannuation schemes covering the workforce) was a relatively generous public sector scheme and the preference was that despite the Coal Terminal being transferred into private hands, employees should continue to have access to SASS. 122On 28 March 1990, PKCT sought advice from Mercer as to whether SASS could continue to cover employees at the coal terminal, and available options if SASS was not able to continue, including advice as to the most appropriate fund (preferably an accumulation fund) "to ensure that the fund design does generally provide realistic benefits in comparison to those now available from the State Funds". A Superannuation Joint Working Party was formed comprising employer and employee representatives. 123On 3 May 1990, the New South Wales Government formally announced the sale of the coal terminal. On 6 May 1990, the FEDFA notified an industrial dispute to the Commission regarding "non-agreement about superannuation entitlements". This was the initiation of proceedings before Hungerford J. Shortly thereafter, PKCT was formally advised it would be inappropriate for PKCT employees to remain in SASS. 124In the proceedings before Hungerford J it was made quite clear by Mr Bunting for the consortium that PKCT's approach was an "overall assessment... not a benefit by benefit assessment". There was no disagreement with that position by any union representative at the time it was put or subsequently during the proceedings before his Honour or during the negotiations relating to a new fund. 125What then followed has been described earlier in this judgment. PKCT sought and received various advices from Mercer regarding a superannuation scheme to replace SASS for those employees whose employment was to be transferred from the MSB to PKCT and negotiations proceeded in the Joint Working Party. 126On 7 June 1990, PKCT put its first proposal to the Joint Working Party regarding a replacement fund, including comparison tables of KCL, SASS and PKCT referred to earlier. It was agreed that the unions were to seek advice from Bain & Co, an organisation described as the "ACTU's endorsed superannuation advisor". In early June 1990, the workforce rejected the first PKCT proposal. 127Based on Bain & Co's advice, the employee representatives of the Joint Working Party proposed changes to PKCT's first proposal. These included: (1)the employee contribution should be from 5-10% at the election of the employee; (2)the employer contribution should be 1.75 x employees' contributions; (3)the need to accommodate the needs of the older workforce in the 55-60 year age group. 128PKCT consulted again with Mercer and a further Joint Working Party meeting was held on 21 June 1990. It was agreed that from age 52 - 58, employees would be able to elect to add 2% to their employee contributions matched by an additional 3.5% contribution by the Company. The union representatives continued to press for a flexible contribution, for example, 5-10% employee contributions up to a matching 7.5% company contribution, or a higher flat percentage employer contribution, of say 6% or 6.5%. PKCT agreed to consult further with Mercer about the 6% contribution rate. 129PKCT made further changes to its proposal based on Mercer advice and the union representatives consulted with Bain & Co, which had direct access to Mercer to discuss with Mercer the details of the proposed new fund. On 11 July 1990, the Joint Working Party issued a statement advising that it was in a position to recommend the PKCT Fund. The statement confirmed that the union representatives of the Joint Working Party had received advice from Bain & Co. Messrs Annesley, Cram and Atkin signed the statement on behalf of the union representatives of the Joint Working Party. The union representatives confirmed that they were in a position to recommend the proposed fund to the members. 130As we earlier explained, the employees eventually accepted the recommendation of the Joint Working Party. This was after being provided with information booklets on the PKCT Fund and having attended a general meeting of employees at which Mr Cram is reported to have said: We've had the experts look at it and it is as close as we can get.... 131In addition to access to advice from Bain & Co, the union delegates had access to the resources of their unions. Mr Giddings, for instance, a member of the Australian Manufacturing Workers Union (AMWU), met with full time officials of his Union and the Federated Ironworkers Association (FIA) to discuss the superannuation issue and agreed that the AMWU was a "significant organisation in terms of its membership", a "significant body with considerable research facilities", and had "a genuine interest in relation to the preservation of the rights of members and a concern they got properly looked after". 132The union representatives on the Committee kept in close contact with employees particularly because of the high degree of interest in developments on the superannuation front. Mr Atkin said in his evidence: I can only recall talking to lots of employees because employees were asking me all the time, they knew I was on the committee, they were asking me how's it going, how's it going and I would give them updates. 133Mr Annesley agreed that he, Mr Cram and Mr Atkin did their best to answer questions from their members in a full and honest way. 134In relation to PKCT's initial proposal, Mr Annesley agreed the rejection of that proposal occurred after informed debate amongst the membership. Negotiations then continued in the Joint Working Party with the union representatives, armed with advice from Bain & Co, seeking a more favourable outcome. PKCT advanced another proposal including revised comparison tables of projected lump sum outcomes for new members joining PKCT or SASS. This proposal was recommended by the Joint Working Party for acceptance. 135Mr Annesley's evidence was that the members were provided with substantial and detailed documentation about the further PKCT proposal prior to voting to approve it: Q. You knew because PKA6 revealed that, that the design had come from Mercers and you were, I suggest, satisfied with the description of the scheme that had been advanced and disclosed during the working party meetings to make that recommendation because you considered that enough was known about the design of the scheme to allow you to do your job? A. Yes. HIS HONOUR: The first part of that question was probably a separate question. Q. You knew that Mercer was the body that had designed the scheme? A. Absolutely. KENZIE: There was an assumption in the question. Q. At the time that you signed it, again looking back all these years, you did not feel any additional need to go back to Bain & Company to make any further inquiries as to whether they had any objection to having their name associated with this document? A. No, I no. Q. So far as you were aware, whether you were involved in meetings or not, the document accurately reflected Bain's involvement in the process? A. I would say so. 136"PKA6" was the document variously described as a "booklet" or "leaflet" which had been earlier anticipated (in "PKA5") by the Joint Working Party for issue to members. Mr Annesley was asked a series of questions about it: Q. This [PKA6] presumably emanated from a further working party meeting after 11 July and after the preparation of the leaflet it was distributed under the signature of the working party? A. Yes. Q. This constituted a reaffirmation by the working party of its recommendation in circumstances where documents to be placed before the members explaining the way it would work had been prepared and considered by the working party? A. Yes. ..... Q. Going back to PKA5, this contemplated that the working party was having "booklets prepared to be sent to your home"; do you see that reference to "booklets" in PKA5? A. Yes. Q. There appears to be a description of that in PKA6 which moves from booklets to leaflet. So PKA6 says: On 11 July you were advised that a recommendation and (b) a special leaflet was being prepared to explain the proposal superannuation fund; do you see that? A. Yes. Sorry? Q. It describes it as a leaflet in PKA6 and then in PKA6 it goes on to say: "A leaflet explaining the proposed superannuation fund is attached for your consideration"; do you see that? A. Yes. Q. Again a little bit of slippage of terms, am I right in understanding that, although it's described as a leaflet here, what appears as part of PKA6 was the document that was published, that was anticipated in PKA5 called a booklet in PKA5; would that be a proper understanding? A. I would say so. 137It would appear PKA6 was most likely sent to employees' homes so they had an opportunity to read it before attending a general meeting and voting on the new scheme. PKA6 contained detailed information as to projected retirement benefits based on age of entry and age of exit from the PKCT Fund. It showed where some employees retiring at 60 would be worse off. 138Mr Giddings, Mr Hooper and Mr Atkin appreciated there was no pension option in PKCT's proposed scheme. 139Mr Atkin gave evidence that all of the information that he had as a union representative of the Joint Working Party was conveyed to the employees. 140Mr Strudwick agreed that when he attended the meeting arranged to explain the PKCT scheme, his impression was that the representatives addressing the employees, including Mr Cram, were doing their best to "actually describe the reality of that scheme to the people concerned so that they could have an informed position". 141In addition to these matters, as we earlier discussed: (1)The union representatives of the Joint Working Party knew that the PKCT Fund and the SASS funds were of fundamentally different types. They appreciated that SASS was a defined benefit fund and that PKCT was an accumulation type fund and that this meant employees would be exposed to the risks of the market. (2)The information provided by the union representatives of the Joint Working Party made clear to the employees the characteristic of the PKCT Fund as fundamentally different to SASS and that the outcomes between the two schemes would not be the same. (3)The union representatives of the Joint Working Party knew that the figures produced by PKCT and Mercer were only projections of possible future benefits and were reliant on assumptions as to interest rates, market returns and the like into the future which could not be guaranteed. (4)When PKCT's proposal was recommended for approval to the employees by the union representatives of the Joint Working Party it was clear to them that the negotiated fund involved a compromise where some individuals may gain or lose over time, but which produced a result that was acceptable overall. There was no guarantee that the outcomes would be identical. 142Turning to the reasons why the primary judge found there was unfairness because employees were in a disadvantaged bargaining position, his Honour first relied on the finding that Mercer's reports were not routinely provided to the employee members of the Joint Working Party. His Honour did not identify which reports or aspects of reports not passed on to union representatives of the Joint Working Party gave rise to a disadvantage. PKCT's proposals for a superannuation scheme put to the union representatives were based on Mercer's advice. There was nothing identified to the Full Bench that was lurking in the advice not provided to the union representatives that could be said to place those representatives at a disadvantage. 143That brings us to the second reason, namely, that the extent of the assistance provided to the unions by Bain & Co was unclear; union representatives from organisations, other than the FEDFA, could not recall being involved with Bain & Co. 144The Union representatives of the Joint Working Party all had access to Bain & Co's advice from an early stage. They also had access to their own unions' not inconsiderable resources. Bain & Co was able to communicate directly with Mercer. The union representatives of the Joint Working Party consulted Bain & Co after PKCT put its first proposal and based on Bain & Co's advice, proposed amendments. As a consequence, PKCT revised its proposal, which was recommended by the Joint Working Party for acceptance and ultimately accepted by the workforce. 145The primary judge's third reason was that superannuation was not well understood in 1990 and the workforce was entirely reliant on others to provide assistance and information to help them in the difficult task of comparing different schemes of superannuation. 146As we earlier accepted, superannuation was not well understood in 1990 and, indeed, the workforce was reliant on the advice of others. The advice that was available to the workforce was from its own dedicated representatives of the Joint Working Party acting in good faith, the union organisations that lay behind those representatives and Bain & Co, a firm endorsed by the unions' peak council, the ACTU, as a provider of advice. There was no suggestion that Bain & Co lacked expertise in the field of superannuation or was at a disadvantage vis a vis Mercer. 147It cannot be the case that simply because employees are reliant on others for advice that, axiomatically, they are disadvantaged for the purpose of the unfair contract provisions of the IR Act. If reputable expert advice is made fully available and is accessed and acted upon by employees of their own free will, then provided the employees have not been misled or there has not been some misrepresentation it is difficult to see how it might be successfully contended that employees were in such an inferior bargaining position that it was unfair. 148The primary judge's fourth reason was that the complexity of the task of creating a scheme of equivalent value to SASS and to do so in a short time frame, fraught with industrial tension, left employees to be guided by the assurances that they would not be worse off. Employees could not realistically have been expected to conduct their own assessment of assumptions drafted by someone else on these highly technical issues. 149As we have sought to demonstrate, the employees were not "left to be guided" by assurances. Further, we have found there was no assurance given that employees would not be worse off. It is quite clear from Mr Bunting's unchallenged statement on the record, the documentary material, the evidence regarding the understanding of the union representatives of the Joint Working Party and what was conveyed to employees, that PKCT's objective was to put in place an accumulation scheme, that assessed overall, would provide benefits not less beneficial than SASS. It was not PKCT's position that no employee would lose, or be disadvantaged, or be worse off, as a consequence of transferring from SASS to the PKCT Fund. 150The primary judge's fifth reason was that the Court has, over the years, rejected a simplistic approach that placed relevant experience/full disclosure/legal advice as barring relief under unfair contract provisions of the IR Act. His Honour referred to three cases in particular at [308]: Hasyim v Lark [1979] AR (NSW) 909; Terzian v Gattellari [1972] AR (NSW) 591 and Haddad v S & T Income Aid Specialists Pty Ltd (1984) 13 IR 16. 151Haysim concerned the sale of a business that was ostensibly a smallgoods distribution run from a factory in Bankstown to hotels and other places on the South Coast. Despite what the Court described as the purchaser's "extreme foolishness" in not seeking assistance in relation to the purchase and without inspecting the books or records of the business, the Court found the contract was unfair in that the purchaser of the business did not understand the true nature of the contract, which involved direct selling to drinking customers outside hotels and clubs or from a basket inside the premises. The Court found the purchaser was limited in his ability to speak, read and understand English and, therefore, lacked comprehension about the nature of the business he purchased. It was also found that the lack of comprehension was due to a failure by the vendor's agent to explain fully the nature of the business. 152In Terzian the Court found an agreement between a singer and her manager was unfair. The Court held the exercise of jurisdiction under s 88F of the Industrial Arbitration Act 1940 (a predecessor provision to s 106 of the IR Act) did not depend on there having been misrepresentations, innocent or fraudulent, or a misapprehension on the part of an applicant as to the nature of his or her rights and obligations under a contract. Rather, the Court was concerned with the objective question of whether or not the contract or arrangement was unfair; it mattered not that the applicant ought to have realised that the contract was unfair when he or she entered into it. The Court held the agreement was unfair, inter alia, because it governed a personal relationship in which the singer was held to her manager for an excessive period of time, that the manager did not fulfil his obligations to act as the singer's personal manager and that the manager no longer wished to act as manager or agent for artists in the entertainment industry. 153In Haddad, although the applicant, a man with considerable relevant experience, had received legal advice not to enter the contract because of the restraint of trade clause, the Court found that the respondents had adopted a course of conduct designed to pressure the applicant to accept changes to the contract or pay commission. The applicant resisted the respondents' changes, which the Court found were spuriously based, and wished to pull out of the agreement. The Court held it would be unfair to permit the contract to remain on foot, particularly the restraint of trade provisions. 154The primary judge was correct in observing that the Court has rejected a simplistic approach that placed relevant experience/full disclosure/legal advice as barring relief under unfair contract provisions. Each case has to be considered having regard to its peculiar facts, as the aforementioned cases demonstrate. Reliance on those cases, however, does not assist. In Haddad, although the applicant received legal advice not to enter the contract, the contract was declared unfair because the respondents improperly placed pressure on the applicant to change the terms of the contract. In Terzian, even though the applicant ought to have realised that the contract was unfair when she entered into it, the contract was found to be unfair because of terms governing what was a personal relationship and because the respondent no longer wished to act as manager. In Haysim, despite the applicant not seeking advice about the business he purchased, the contract was declared unfair because of the applicant's limited command of English and lack of understanding and because the nature of the business was not fully explained to him. In none of those cases was it held the contracts were unfair because of unequal bargaining positions. 155In the present case, the employees were ably represented in negotiations that in our opinion were conducted transparently, they had access to well resourced unions, they had access to and were provided with expert superannuation advice, they were provided with extensive information regarding the proposed fund before being asked whether the fund was acceptable to them, they understood the investment risk they were taking on and that the projected retirement benefits were based on assumptions. It was not the case that the employees were left to rely on assurances they would not be worse off. 156If the primary judge's statement that "it would be (sic) not be appropriate or fair that relief be withheld from the employees because they had some level of expert assistance and union representation prior to accepting the scheme offered by PKCT" is to be construed as a finding that relief should be granted because employees were at a disadvantage in terms of their bargaining position, and we think it must, then we find his Honour erred. Error of failing to find any employee was worse off 157The appellant submitted the primary judge made a finding of unfairness without any analysis of whether the individual claimants were actually worse off under the PKCT scheme than they would have been under the SASS scheme and with no account of how they were better off under the PKCT scheme. 158The primary judge found PKCT had represented to employees that they would be provided with benefits equivalent to SASS and that they would be no worse off (see [373]. In order to find unfairness, it was incumbent on the primary judge to not only make the finding regarding PKCT's representation, but also to make a finding that employees acted upon the representation to their detriment. That is, the primary judge needed to explain how employees were not provided with equivalent benefits and how they were worse off. 159We have found that the representation by PKCT was to the effect that it would provide an accumulation scheme that overall delivered, as near as possible given the fundamentally different nature of the scheme, benefits not less beneficial than SASS. There was no representation that individual employees would not be worse off. Moreover, as we have found, the employees were not in a disadvantaged bargaining position such as to render the contracts or arrangements unfair. 160In these circumstances the only basis, in any way consistent with the pleadings and arguments presented in the case whereby unfairness could be found, is if on an overall comparison of the two schemes the PKCT scheme did not provide benefits of equivalent value to SASS. If the benefits overall were not of equivalent value, or were "less beneficial" such that the body of members as a whole suffered detriment, that would be inconsistent with PKCT's representation and may constitute a basis for a finding of unfairness. 161Thus, given our finding that there was no representation made by PKCT that individual employees would not be worse off, it is unnecessary to consider whether the primary judge erred in failing to undertake any analysis of whether the individual claimants were actually worse off. However, we think it is necessary to consider whether his Honour undertook a comparison of the two schemes and whether that comparison revealed there was no equivalence of value such that the body of members suffered detriment. 162Based on Mr Rawsthorne's evidence, his Honour found that the PKCT scheme did not provide for a pension option if an employee remained in employment to age 60 and that the scheme did not compensate employees for the fact that the investment risk transferred from the employer to the employees. This led the primary judge to find that employees were not provided with benefits of equivalent value to SASS and were worse off under the PKCT scheme contrary to the representations that had been made to them. 163However, it is not immediately apparent from the primary judge's reasons whether the position adopted by his Honour was arrived at on the basis of reasoning that because the PKCT scheme did not provide for a pension option and did not compensate for the transfer of investment risk, then axiomatically employees were worse off, or whether, based on Mr Rawsthorne's evidence, the primary judge did undertake the necessary exercise of comparing the benefits provided by the PKCT scheme with those under SASS before arriving at his finding that there was no equivalence in value and employees were worse off. His Honour nowhere makes a clear finding that leaves no doubt about which approach he took. 164That the primary judge may have taken the former approach is suggested by the fact he was unable to accept the evidence of either expert as to their respective valuations of gains and losses between the two schemes (see [348]) and was left with Mr Rawsthorne's evidence that because the PKCT scheme did not provide a pension option or compensation for investment risk, employees were worse off. In the absence of a basis upon which to assess the value of the losses under the PKCT scheme his Honour was forced to devise his own compensation package on a basis completely divorced from the "deficiencies" his Honour found in the PKCT scheme and which, arguably, had no connection to the unfairness found. 165If the basis of his Honour's finding that there was no equivalence of value simply because the PKCT scheme did not provide for a pension and did not compensate for transfer of the investment risk, then we do not consider it was open to his Honour to find there was no equivalence of value. As we have made clear, in order to find the PKCT Fund did not provide benefits equivalent in value to the SASS scheme, it was necessary to undertake an overall comparison of the benefits in the two schemes. 166As to the second approach described above, the strongest indication that the primary judge understood it was necessary to compare the benefits in the two schemes for the purpose of determining whether there was equivalence of value, appears at [299] of his Honour's reasons: [299] No reason was ever proffered as to why a pension such as available in SASS could not have been provided in the PKCT fund. (Mr Murphy thought that the fund would not be a pure accumulation fund if that occurred, but that is of no relevance for present purposes). Importantly, the objective focused not only on equivalent benefits, but also the "value" of such benefits. If there was some understandable reason for not making the pension available then some other benefit of equal value had to be included in the new fund. The same approach applies to the transfer of investment risk: here, there was no option because of the nature of an accumulation fund. In this circumstance, Mercer had to value the lost stability of a defined benefits fund with the known certainty of its benefits at retirement and provide an equivalent benefit in the PKCT fund. 167The question is, however, whether his Honour took the next step of considering whether, in the absence of a pension option and absence of compensation for the transfer of risk in the PKCT Fund, some "benefit of equal value" had been substituted in that Fund. 168It is apparent that the basis upon which the primary judge found the PKCT scheme did not provide benefits of equivalent value to those in SASS and consequently that employees were worse off, was the evidence of Mr Rawsthorne. At [347] his Honour stated: Overall, the Court would prefer the evidence of Mr Rawsthorne as his assessment was framed in the context, not of a strict actuarial approach, but against the necessary background that the PKCT scheme had to provide equivalent benefits to those available under SASS.... 169Further, at [350] the primary judge accepted Mr Rawsthorne's evidence supported a conclusion that the loss of the pension option and the passing of the investment risk from the employer to the employee was not taken into account in designing the PKCT scheme and this gave rise to unfairness: In applying the wider concepts of fairness, it was unfair that no explicit or any other consideration was given to the loss of the pension option or, to the passing of the investment risk from the employer to the employee. The importance of these two issues is that the evidence supports Mr Rawsthorne's conclusion that these matters were not taken into account by Mercer in designing the new fund. It is also significant that Mr Murphy accepted that these two matters were not explicitly taken into account on any consideration of the working papers made available by Mercer. The evidence supports Mr Rawsthorne's opinion that no consideration was given to these two elements in setting the design of the new superannuation scheme. 170This reference to his Honour's reasons indicates a finding that pension and investment risk "were not taken into account by Mercer in designing the new fund." However, they do not reveal whether the primary judge considered other benefits included in the PKCT Fund and whether they had the effect of offsetting the losses associated with absence of the pension and the investment risk. 171It is, however, tolerably clear from [251]-[253] of his Honour's reasons for decision that he accepted evidence of Mr Rawsthorne that Mr Rawsthorne had assessed gains and losses in the PKCT scheme and concluded there were two primary areas that constituted net loss: absence of pension option and transfer of investment risk to employees: [251] It is against all of this material that the challenges to Mr Rawsthorne's evidence must be assessed. It is somewhat surprising that Mr Rawsthorne accepted the fundamental proposition put to him by senior counsel, namely, that he had identified a significant benefit to people in their 20s under the PKCT scheme but after his initial consideration, that matter was not revisited. He also accepted the proposition that, in valuing the benefits of the two schemes, they had largely cancelled out each other, leading to major areas of loss. Mr Rawsthorne agreed that he did not give a precise value to each element of both funds in concluding that, broadly, the other benefits were not significantly different. The respondent's analysis, however, pays no attention to the identification of numerous benefits in Mr Rawsthorne's 2007 first report, particularly as set out in [238] and [239]. The analysis ignores the fact that Mr Rawsthorne demonstrated that the two identified heads of loss had not been taken into account by Mercer and that he had then calculated the level of each loss. His "general" and "swings and roundabouts" approach was not dissimilar to the approach adopted by Mr Murphy. Mr Murphy's description of what would be required when valuing the two schemes was that an Actuary would not attempt to value every small aspect in a complex fund, but would approach the task more generally in assessing whether or not there was an equivalence of benefits. [252] Viewed against that background, the Court is unable to agree that Mr Rawsthorne's reports, as a whole, are inadmissible. Mr Rawsthorne's detailed reports and the flow of discussion backwards and forwards through Mr Murphy's reports provide a great deal of information about the operation of these two superannuation funds and how their equivalence or lack of equivalence might be gauged. As already noted, senior counsel for the respondent accepted that it might well be open to accept Mr Rawsthorne's evidence, but not his assessment as to losses said to be suffered by employees in transferring to the PKCT fund. As will become clear in the concluding paragraphs of this judgment, while the Court has been assisted by the experts' reports, it has found neither conclusion appropriate in exercising the jurisdiction under s 106 of the Act in determining the fairness of the superannuation arrangements, nor in coming to a conclusion in applying s 106(5) in arriving at a money order that is just in all the circumstances of the case. [253] Having regard to the evidence of both experts concerning the complexity of the valuing and comparison exercise, it appears to be common ground that one acceptable method of valuation would be to consider the SASS scheme in an overall, general manner and then, in a general way, assess whether the PKCT fund was as good as or, worse than the SASS fund. Both experts, at times, adopted this approach. Mr Rawsthorne looked closely at the SASS scheme (contrary to the respondent's submission) and indicated a number of losses and few gains: in this sense, he disclosed the facts and assumptions upon which he formed his view as to losses arising in the PKCT fund. In doing so, he exercised his knowledge and experience as an expert. Ultimately, the Court cannot conclude that, Mr Rawsthorne's views, formed in general, are inadmissible: in particular, Mr Rawsthorne was entitled to express the view that, after consideration of the elements of both schemes, there were primarily two areas of loss. Significantly, Mr Murphy expressed the broad view that once an accumulation fund was chosen for the new scheme, it was impossible to ensure equivalent benefits to SASS for new employees: there would be winners and losers. 172The appellant submitted the evidence of Mr Rawsthorne should not have been relied upon by Haylen J and his Honour erred by failing to exclude it in circumstances where it did not comply with the Expert Code of Conduct and did not comply with the principles enunciated in Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705 and Dasreef Pty Ltd v Hawchar [2011] HCA 21; (2011) 243 CLR 588. 173The appellant submitted the evidence should not have been relied upon because Mr Rawsthorne did not expose his reasoning and calculations in specifically valuing each of the areas of loss compared with each of the areas of gain under the PKCT system and unacceptably relied on a "swings and roundabout" approach to make the comparison. Moreover, it was submitted, Haylen J failed to have regard to the unchallenged evidence of Mr Murphy that the employees in question were better off overall under the PKCT Fund than they would have been under SASS. 174As we understand it, the conflict the appellant was raising regarding the Expert Witness Code of Conduct (see Appendix 7 to the Uniform Civil Procedure Rules 2005) and Mr Rawsthorne's evidence was in relation to cl 2(3) and cl 5(1)(b) and (c) of the Code, which provide: 2 General duty to the court ... (3) An expert witness is not an advocate for a party. ... 5 Experts' reports (1) An expert's report must (in the body of the report or in an annexure to it) include the following: ... (b) the facts, and assumptions of fact, on which the opinions in the report are based (a letter of instructions may be annexed), (c) the expert's reasons for each opinion expressed, ... 175The reference to Makita was a reference to what Heydon JA stated at [79]: [79] In National Justice Compania Naviera SA v Prudential Assurance Co Ltd ("The Ikarian Reefer") [1993] 2 Lloyd's Rep 68 at 81-82 Cresswell J set out a list of duties and responsibilities of expert witnesses in civil cases as follows: "1. Expert evidence presented to the Court should be, and should be seen to be, the independent product of the expert uninfluenced as to form or content by the exigencies of litigation.... 2. An expert witness should provide independent assistance to the Court by way of objective unbiased opinion in relation to matters within his expertise.... An expert witness in the High Court should never assume the role of an advocate. 3. An expert witness should state the facts or assumption upon which his opinion is based. He should not omit to consider material facts which could detract from his concluded opinion. 4. An expert witness should make it clear when a particular question or issue falls outside his expertise. 5. If an expert's opinion is not properly researched because he considers that insufficient data is available, then this must be stated with an indication that the opinion is no more than a provisional one.... In cases where an expert witness who has prepared a report could not assert that the report contained the truth, the whole truth and nothing but the truth without some qualification, that qualification should be stated in the report.... 6. If, after exchange of reports, an expert witness changes his view on a material matter having read the other side's expert's report or for any other reason, such change of view should be communicated (through legal representatives) to the other side without delay and when appropriate to the Court. 7. Where expert evidence refers to photographs, plans, calculations, analyses, measurements, survey reports or other similar documents, these must be provided to the opposite party at the same time as the exchange of reports...." While some of these matters have an ethical dimension, taken together they point to the need for the trier of fact to be fully informed of the reasoning process deployed in arriving at the expert's opinions. Cresswell J's list has been influential both in causing rules of court to be devised in this and other jurisdictions to control expert evidence and in later judicial pronouncements. Thus in Clough v Tameside and Glossop Health Authority [1998] 2 All ER 971 at 977 Bracewell J said: "It is only by proper and full disclosure to all parties, that an expert's opinion can be tested in court: in order to ascertain whether all appropriate information was supplied and how the expert dealt with it. It is not for one party to keep their cards face down on the table so that the other party does not know the full extent of information supplied." This implies that not only must the appropriate information be supplied, but that the expert must reveal the whole of the manner in which it was dealt with in arriving at the formation of the expert's conclusions. See also Dasreef at [37] and [42]. 176Mr Rawsthorne had provided a letter and report to the respondent's solicitors in March 2007 in which he confirmed his instruction that: In particular you have sought advice on whether the members concerned are worse off under their current superannuation arrangements than they would have been if they had remained members of the State Authorities Superannuation Scheme in 1990. 177In the letter under the heading "Summary of findings", Mr Rawsthorne identified the transfer of investment risk to employees as losses in respect of which workers "received no compensation or even recognition of these losses". He also identified the option that was available under SASS for ex-NRF members to take a pension on retirement as not having been included in the PKCT scheme. He said this was as a "major area" in which the PKCT scheme was inferior to SASS. 178In his March 2007 letter, Mr Rawsthorne also stated: Offsetting these losses and risks were valuable additions to rights in certain circumstances, which may not have been recognised at the time. In particular the right to receive employer contributions for all years of service, rather than just the first 30 years, as applied in SASS, is a valuable addition to overall superannuation for those workers who commenced service in their twenties and remain until retirement. 179Mr Rawsthorne stated in his report that: For a member starting work at age 25, and working through to age 60, the benefit of having no maximum benefit in the PKCT scheme will be a retirement benefit that is higher by about 1 year's salary. For those who work beyond age 60, the additional benefit available in the PKCT scheme will be greater. 180In his report Mr Rawsthorne identified other gains and losses between the two schemes. In relation to death and disability benefits, for example, Mr Rawsthorne opined that the PKCT benefit was "superior" to SASS in all cases. 181In his March 2007 letter, after referring to investment returns having been lower than expected relative to salary growth, Mr Rawsthorne stated that "as a result most members would probably have been better off had they remained in SASS." 182The 2007 letter and report of Mr Rawsthorne was not sought to be admitted as an exhibit or annexure to any of the five affidavits deposed by Mr Rawsthorne that were tendered into evidence and sought to be treated as expert evidence (there were seven reports by Mr Rawsthorne annexed to his affidavits, not including his 2007 report, that were tendered as expert evidence). 183In none of the reports specifically tendered as expert evidence did Mr Rawsthorne revisit the question of additions to the PKCT scheme that could be regarded as offsetting the pension and investment risk losses. On the face of it, he proceeded on the basis that given the representation that the PKCT Fund was to provide benefits of equivalent value, the fact that the pension option under SASS was not a part of the PKCT scheme and no compensation had been provided for the transfer of the investment risk, meant that there was no equivalence of value. In none of his reports subsequent to 2007 did Mr Rawsthorne undertake any comparison, actuarial or otherwise, of the benefits provided by the two schemes that could constitute the basis for a finding there was no equivalence of value. 184That draws attention back to the March 2007 letter and report. These found their way into the evidence as part of an agreed tender bundle. They were not tendered by the CFMEU as expert evidence and could not have been because they did not comply with the Expert Witness Code of Conduct in relation to the requirements regarding expert reports. There was no evidence that Mr Rawsthorne was requested to compile the report as an expert and in accordance with the Code. 185Whilst Mr Rawsthorne was later qualified as and accepted by the appellant as an expert in relation to his evidence in his five affidavits (with seven reports attached) we do not consider it open to accept the March 2007 letter and report as expert evidence. The reason for that relates to the background to these two documents. 186The proceedings that resulted in the first instance decision were commenced in 2005 on the basis of a claim of misrepresentation that figures contained in a document published to the employees were not true or accurate in that they wrongly represented (and under-estimated) the members' future projected entitlements under SASS. Donald Steel & Associates, a firm of actuaries, provided the advice underpinning the claim. 187The basis of the claim, that is Mr Steel's advice, was subsequently found to be incorrect. On 12 February 2007, in the wake of this development, the CFMEU consulted Mr Rawsthorne. In the initial briefing letter to Mr Rawsthorne the CFMEU provided Mr Rawsthorne with 10 written reports from Mr Steel as well as correspondence from Mr Steel dating back to 2001. Mr Rawsthorne's instructions stated that: As you will note from Mr Steel's reports, there has been some conclusions drawn by Mr Steel that ultimately he has found to be incorrect. 188It was in the initial briefing letter from the CFMEU's solicitors that Mr Rawsthorne was asked, "whether the members concerned are in fact worse off under their current superannuation arrangements than they would have been if those arrangements had not been altered in 1990." 189In his report, of 19 March 2007 Mr Rawsthorne: (a) confirmed that he had read through the material supplied to him and had conferred with Mr Steel; and (b) identified as new matters the transfer of investment and longevity risk from the employer to the workers (for which no compensation was given) and the removal of the right to a pension for ex-NRF members of SASS. 190As we have explained, he also identified offsetting additions to rights in certain circumstances and, in particular, the right to receive employer contributions for all years of service rather than just the 30 years as applied in SASS as a "valuable addition to overall superannuation for those workers who commenced service in their twenties and remained until retirement". 191On 23 March 2007, the CFMEU filed an Amended Summons for Relief to reflect the new matters identified by Mr Rawsthorne. 192Mr Rawsthorne was not approached in 2007 to give advice as an expert for use in proceedings before the Industrial Court and on the basis he had read the Expert Code of Conduct. He was asked to advise a client, in circumstances where the original justification for its claim that members were worse off was no longer viable, whether there was any justification for the claim - to search for a justification if one existed. In those circumstances, in compiling his letter and report in March 2007, Mr Rawsthorne did not have an eye to his obligations under the Expert Code, including his "paramount duty... to the court and not to any party to the proceedings", or on his "overriding duty to assist the court impartially on matters relevant to the expert witness's area of expertise". Nor is it known whether Mr Rawsthorne compiled the letter and report knowing he was not to do so as an advocate for his client. 193What is more, as they was not tendered as expert evidence there was no opportunity for Mr Murphy, the appellant's expert, to consider and comment on the March 2007 letter and report, as he did with all of Mr Rawsthorne's expert evidence, so that the Court might receive the benefit of another expert's analysis of those documents as to whether the approach taken was valid or invalid. 194We consider Haylen J erred in relying on Mr Rawsthorne's March 2007 letter and report as expert evidence. That leaves his acknowledged expert evidence, which is devoid of any comparative analysis of the overall benefits of the two schemes that would enable a finding to be made that the PKCT Fund did not provide benefits of equivalent value. 195Even if the March 2007 letter and report was available as expert evidence for his Honour's consideration, it does not advance the matter in the respondent's favour. Both in respect of his expert evidence and his March 2007 letter and report, Mr Rawsthorne agreed that the approach he took, in concluding that loss of the pension option and absence of compensation for the transfer of investment risk represented a net loss for members of the PKCT scheme, was to look at matters "in a general way" and by "adopting a swings and roundabouts approach" (see [240]). Mr Rawsthorne accepted he did not expose his calculations and reasoning in reaching his conclusion (at [240]). 196We do not consider a "swings and roundabouts approach" allowed the "trier of fact to be fully informed of the reasoning process deployed in arriving at the expert's opinions" (Makita at [79]). Nevertheless, the primary judge accepted that approach as appropriate because (see [251]): (1)Mr Rawsthorne identified "numerous benefits" in his 2007 report (his Honour identified these at [238] and [239]). (2) Mr Rawsthorne demonstrated that the two identified heads of loss had not been taken into account by Mercer and that he had then calculated the level of each loss. (3)His "general" and "swings and roundabouts" approach was not dissimilar to the approach adopted by Mr Murphy, namely, when valuing the two schemes an Actuary would not attempt to value every small aspect in a complex fund, but would approach the task more generally in assessing whether or not there was an equivalence of benefits. 197As to the first matter, whilst Mr Rawsthorne considered a number of benefits representing loss and gain in the PKCT scheme he did not, as the primary judge acknowledged at [239], take the step of considering on an overall basis "areas of loss as against areas of gain or areas of neutral effect". His Honour believed, nevertheless, "a consideration of the report permits this analysis". His Honour, however, did not proceed to undertake the analysis. 198Additionally, nowhere in his March 2007 report or covering letter does Mr Rawsthorne come to an unequivocal conclusion that members of the PKCT Fund were worse off. He considered they "would probably have been better off had they remained in SASS". However, this was said to be as a result of investment returns being lower than expected relative to salary growth. There was never any assurance given by PKCT that members of the PKCT Fund would be better off because of higher investment returns. Employees and those representing them understood the figures produced by PKCT and Mercer were only projections of possible future benefits and were reliant on assumptions as to interest rates, market returns and the like into the future which could not be guaranteed. 199As to the second matter, the fact that Mercer may not have taken the pension and transfer of investment risk into account does not prove that the overall benefits in the PKCT Fund were inferior to SASS and that, therefore, employees as a whole were worse off. 200As to the third matter, it may be accepted that "every small aspect" of a superannuation fund might not be valued in comparing two different types of funds. However, what appears to be more akin to an assessment of the benefits in the two schemes based on intuition rather than objectivity by Mr Rawsthorne, is not a reasonable platform of expert evidence upon which to base a conclusion that the PKCT Fund did not provide benefits of equivalent value to the SASS scheme. 201Moreover, we would observe his Honour (at [252]) was not prepared to accept Mr Rawsthorne's "conclusion [as] appropriate in exercising the jurisdiction under s 106 of the [IR] Act in determining the fairness of the superannuation arrangements". We take that to mean from its context that his Honour was not prepared to accept Mr Rawsthorne's assessment as to "losses said to be suffered by employees in transferring to the PKCT fund". That is, the value of those losses. 202The primary judge was, however, prepared to allow the opinion of Mr Rawsthorne to underpin a conclusion that absence of the pension option and absence of compensation for transfer of the investment risk were "deficiencies" in the PKCT scheme compared to the SASS scheme and accordingly gave rise to an unfairness. 203It is difficult to understand how, on the one hand, his Honour was not able to accept Mr Rawsthorne's evidence as to what value he placed on the "deficiencies" in the PKCT scheme, but on the other hand was able to find the deficiencies gave rise to unfairness. That suggests the primary judge himself took a "swings and roundabouts approach" that had no verified or verifiable foundation. 204The respondent submitted that alleged error regarded the receipt of Mr Rawsthorne's evidence fell to be considered in light of the way in which the case was conducted in that the appellant agreed that objections to the experts' evidence was reserved to be dealt with in addresses. It was submitted the unsatisfactory nature of the appellant's challenge to the entire admissibility of Mr Rawsthorne's evidence was highlighted by the majority judgment in Dasreef at [19]: [19] As a general rule, trial judges confronted with an objection to admissibility of evidence should rule upon that objection as soon as possible. Often the ruling can and should be given immediately after the objection has been made and argued. If, for some pressing reason, that cannot be done, the ruling should ordinarily be given before the party who tenders the disputed evidence closes its case. That party will then know whether it must try to mend its hand, and opposite parties will know the evidence they must answer. 205Our reading of the record of proceedings, however, indicates that both parties agreed to the process by which objections to the expert evidence would be determined at the conclusion of the evidence. The primary judge was content with the approach agreed between the parties. 206The respondent also submitted the appellant did not adopt the approach to the expert evidence issue as required by the High Court in Dasreef, in having regard to the requirements of the Evidence Act 1995, where the plurality said (footnotes omitted): [37] It should be unnecessary, but it is nonetheless important, to emphasise that what was said by Gleeson CJ in HG (and later by Heydon JA in the Court of Appeal in Makita (Australia) Pty Ltd v Sprowles is to be read with one basic proposition at the forefront of consideration. The admissibility of opinion evidence is to be determined by application of the requirements of the Evidence Act rather than by any attempt to parse and analyse particular statements in decided cases divorced from the context in which those statements were made. Accepting that to be so, it remains useful to record that it is ordinarily the case, as Heydon JA said in Makita, that "the expert's evidence must explain how the field of 'specialised knowledge' in which the witness is expert by reason of 'training, study or experience', and on which the opinion is 'wholly or substantially based', applies to the facts assumed or observed so as to produce the opinion propounded". The way in which s 79(1) is drafted necessarily makes the description of these requirements very long. But that is not to say that the requirements cannot be met in many, perhaps most, cases very quickly and easily. That a specialist medical practitioner expressing a diagnostic opinion in his or her relevant field of specialisation is applying "specialised knowledge" based on his or her "training, study or experience", being an opinion "wholly or substantially based" on that "specialised knowledge", will require little explicit articulation or amplification once the witness has described his or her qualifications and experience, and has identified the subject matter about which the opinion is proffered. ... [42] A failure to demonstrate that an opinion expressed by a witness is based on the witness's specialised knowledge based on training, study or experience is a matter that goes to the admissibility of the evidence, not its weight. To observe, as the Court of Appeal did, that what Dr Basden said about the volume of respirable dust to which Mr Hawchar was exposed over time was "an estimate" that was "contestable and inexact" no doubt did direct attention to its worth and its weight. But more importantly, it directed attention to what exactly Dr Basden was saying in his evidence and to whether any numerical or quantitative assessment he proffered was admissible. And if, as the Court of Appeal observed, his opinion on that matter lacked reasoning, the absence of reasoning pointed (in this case, inexorably) to the lack of any sufficient connection between a numerical or quantitative assessment or estimate and relevant specialised knowledge. 207In particular, the respondent submitted the appellant did not assert below and did not assert on appeal that: (a) Mr Rawsthorne was unqualified to express an opinion about the operation of superannuation funds including public sector superannuation funds and valuing their benefits by carrying out an actuarial exercise; (b) the opinions that were actually expressed by Mr Rawsthorne were not based on his specialised knowledge based on training, study and experience. 208Mr Rawsthorne's approach to determining the question of whether the benefits in PKCT scheme were equivalent in value to those provided by the SASS scheme was based on "swings and roundabouts" and his calculations and the process of reasoning was not revealed. Regardless of whether he was regarded as an expert in preparing his March 1997 letter and report (noting these documents were prepared in the absence of any regard to the Expert Witness Code of Conduct), Mr Rawsthorne's opinion rated no more highly than an "estimate"; it was "contestable and inexact". 209The other criticism made by the appellant was that the primary judge failed to have any regard to the unchallenged evidence of Mr Murphy, which was the only evidence to value the actual relative positions of the employees as between the PKCT Fund and what their position would have been had they remained in SASS. 210We think it is apparent that his Honour did have regard, overall, to Mr Murphy's evidence, but did not come to rely upon it because he rejected Mr Murphy's approach. That is, his Honour did not agree that because the comparison was to be made between two different types of superannuation schemes there would be "winners and losers", which Haylen J considered to be contrary to the representation made by PKCT that members of the PKCT Fund would not be worse off. 211As we have found, there was no representation by PKCT that members of the PKCT Fund would not be worse off. Rather, the effect of the representation was that PKCT would provide a superannuation scheme of an accumulation type that overall delivered, as near as possible given the fundamentally different nature of the scheme, retirement benefits not less beneficial than SASS. Given this was the representation, Mr Murphy's evidence becomes relevant. 212Mr Murphy's evidence regarding the overall position of employees under the PKCT scheme compared to the position they would have enjoyed under SASS (either if they had remained in SASS with accrued service or joined SASS afresh in 1990) was not challenged either by Mr Rawsthorne or in cross-examination. Mr Murphy's evidence was that, as a group overall, the employees were better off in all circumstances under the PKCT Fund than they would have been had they remained in SASS. 213The result of Mr Murphy's calculations may be summarised as follows: (a) The total employer contributions as at 26 March 2006 (including in the calculations the claimants' accrued SASS entitlements arising from their prior service with the MSB) were $5,896,903 greater under the PKCT Fund than they would have been under SASS. (b) The total employer contributions as at 26 March 2006 (with MSB service not included) were $2,068,730 greater under the PKCT Fund than they would have been under SASS. (c) The total employer contributions as at 30 June 2012 (or date of termination if earlier) (with MSB service included) were $8,304,188 greater under the PKCT Fund than they would have been under SASS. (d) The total employer contributions as at 30 June 2012 (or date of termination if earlier) (with MSB service not included) were $3,056,336 greater under the PKCT Fund than they would have been under SASS. 214As the appellant submitted, of all the claimants the only individuals identified by Murphy as behind under the PKCT Fund in lump sum terms, compared to the position they would have enjoyed under SASS, were as follows: (a) In respect of employer contributions as at 26 March 2006 (with MSB service included): None. (b) In respect of employer contributions as at 26 March 2006 (with MSB service not included): Mr Gorman by $3,130 (relative to $159,770), compared to the group as a whole being $2,068,730 better off. (c) In respect of employer contributions as at 30 June 2012 (or date of termination if earlier) (with MSB service included): Mr Buckley $5,270 (relative to $280,092) and compared to the group as a whole being $8,304,188 better off. (d) In respect of employer contributions as at 30 June 2012 (or date of termination if earlier) (with MSB service not included): Mr Buckley $3,790 (relative to $264,959); Mr Sanson $4,074 (relative to $283,256) and compared to the group as a whole being $3,056,336 better off. 215There was no proper foundation for a finding that the PKCT Fund did not provide benefits equivalent in value to those in the SASS scheme. In making such a finding the primary judge erred. Expert evidence error 216We addressed this error under the previous heading. The compensation error 217The appellant submitted error occurred in making an order for compensation in circumstances where: (a) His Honour did not make a finding in respect of each individually named party that their contract was unfair. (b) His Honour failed to identify any particular unfairness to any particular party as he failed to consider whether any individual party was in fact worse off under the PKCT Scheme. In fact, had his Honour referred...to Mr Murphy's report, it would have been apparent that no employees were worse off. (c) His Honour erred by finding that although actuarial evidence had not established any loss by any employee between the two schemes, his Honour was able to find unfairness and make an award of compensation for unfairness (where the Respondent had not discharged its onus to establish loss in the PKCT fund comparable to SASS) (d) His Honour erred by finding that in the absence of any evidence to support a finding of loss (as between the PKCT and SASS funds), his Honour was able to make an order under s 106(5). This is because without the loss between the PKCT and SASS funds, it could not be said that there was unfairness in the contract (as any representation found to have existed would have been made out). (e) His Honour erred by finding that an unfairness arose from a failure by PKCT to adopt a defined benefit fund, when there was no such allegation made in the pleadings.... (f) By his order of compensation, his Honour erred by referring to a meeting in 2004, where a discussion was based on the identification of a deficiency in the PKCT Fund that was subsequently acknowledged to be in error. 218In the absence of any proper basis in his Honour's reasons for a finding of unfairness, it is not strictly necessary to deal with the asserted error regarding his Honour's compensation orders. Compensation orders may only be made "in connection with any contract declared wholly or partly void, or varied, as the Commission considers just in the circumstances of the case": s 106(5) of the IR Act. A contract may only be declared wholly or partly void, or varied if there has been a finding that the contract was unfair: s 106(1). 219We would, however, make the following observations: (1)In circumstances where his Honour found that PKCT's representation included a representation that no employee would be worse off, there was no finding by his Honour in respect of any one of the 78 contracts or arrangements as to the extent to which the employee was worse off or suffered loss. Notwithstanding the absence of such a finding his Honour found all of the contracts were unfair. (2)That 'global approach' of compensating all employees, regardless of whether they in fact incurred loss (and on most Murphy's evidence the great majority did not), was indiscriminate and at odds with a statutory scheme designed to protect employees against unfairness. Indeed, it may be the case that if the compensation orders were to be maintained employees would enjoy a windfall gain. (3)The primary judge was unable to determine the extent of loss suffered by any employee, but despite that found unfairness. In order to cure the unfairness his Honour resorted to a compensation formula that arguably had no connection with the asserted cause of the unfairness and could not be regarded as just in the circumstances of the case. Jurisdictional error 220The appellant submitted that in making orders (a) and (b), the primary judge made orders determining that the contracts of employment between PKCT and the employees were unfair in relation to the provision of superannuation, and orders varying the contracts of the employees from the date of the order related to the finding of unfairness in the superannuation arrangements of employees. These orders, it was submitted, involved the impermissible exercise of jurisdiction to interfere with obligations imposed on PKCT by the Federal instruments in respect of superannuation existing after 26 March 2006. 221In light of our findings regarding errors made by the primary judge in connection with unfairness, it is unnecessary for us to consider the jurisdictional issue. Costs 222The respondent has sought to be heard on costs. It will be given that opportunity. Orders 223The Full Bench makes the following orders: (1)Leave to appeal is granted. (2)The appeal is allowed. (3)The judgment and orders of Haylen J are quashed. (4)Within 14 days of the date of this judgment the respondent shall file and serve written submissions on costs. The appellant has a further 14 days in which to reply. Unless a party seeks to be heard orally, the question of costs will be determined on the papers. ********** 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: 15 August 2014