findings
69 It is accepted that TTS is a constitutional corporation.
70 TTS contends that in fact it has received nothing from TransAdelaide. As the PTB Act makes clear, TransAdelaide could not transmit or assign its business to TT or to TTS, at least without the consent of the PTB: s 42, and it has not done so. In fact, TransAdelaide did not wish to cease operating its business of providing passenger transport services by bus in the areas which it serviced prior to 23 April 2000. Moreover, TTS points out that the PTB could not itself succeed to, or be the transmittee or assignee of TransAdelaide's business because the PTB Act precludes it from operating any such business: s 20.
71 Moreover, it is true, as TTS submitted, that none of the decided cases on s 149(1)(d) or s 170MB concerned circumstances such as the present. That is, it submitted, none concerned a statutory authority or government department which itself was expressly not empowered to conduct the "business" which granted to other entities the right to conduct the "business" for a period upon certain terms and conditions. In this case, they contend, there is no relevant nexus between TransAdelaide and TT whereas some form of nexus did exist in those other cases.
72 I do not consider that those matters preclude TT (or TTS) from being the successor assignee or transmittee of the business or part of the business of TransAdelaide. As noted earlier, I consider it necessary for there to be a practical and real connection between the business operated by TransAdelaide or part of that business, and the business now operated by TT (or TTS) as well as a substantial identity of activities between the two businesses. I shall separately address the implications of the arrangements between TT, TTO and TTS. The context in which that connection is to be found, if it exists, is the legislative framework by which TT came to operate its business (or, more accurately, to contract with the PTB to operate its business and then, with the PTB's consent, to subcontract that function to TTO). This is not a case where a non-government employer is alleged to have taken over the business of another non-government employer in the open market. It is a case where a government has contracted with a non-government employer for the provision of services to the public under terms fixed and controlled by that government, and at the expiration of that contract has contracted with a different non-government employer for the provision of similar services to much the same section of the public still under terms fixed and controlled by that government. The PTB Act, as noted, prevents the PTB itself from operating a passenger transport service.
73 The circumstances in which TT (or TTS) came to operate the business of providing passenger transport services by bus in certain areas of the metropolitan area of Adelaide are set out above. The overriding circumstance is that the right to operate that business was and remains within the statutory power of the PTB to grant under the PTB Act.
74 Section 39(4) of the PTB Act makes it unlawful for a person to operate a regular passenger service otherwise than under the authority of a service contract under that Act. A regular passenger service is defined to include (subject to services exempted by regulation) any passenger transport service conducted according to regular routes and timetables, that is any service involving the carriage of passengers for a fare or other consideration: s 4. Consequently the relevant business of TransAdelaide was conducted only under the statutory regime created by the Act. So too is the business now conducted by TT (or TTO). The right to conduct those businesses was within the power of the PTB to grant. It is an instrumentality of the Crown: s 6(3). Moreover, the grant of such a right by the PTB is necessary for the conduct of such a business. In my view, it is that statutory structure which provides the relevant nexus between the business of TransAdelaide on the one hand and TT (or TTO) on the other to expose TT (or TTO, and TTS as a subcontractor which is a subsidiary of TTO subject to considering its particular circumstances) to vulnerability as a successor assignee or transmittee of the business of TransAdelaide. It is also, of course, necessary to determine whether the character of the two businesses is substantially the same.
75 As the evidence shows, the PTB owns or controls the buses and the depots. They are significant assets used in the business, and were significant assets used in TransAdelaide's business. The PTB controls who provides passenger transport services by bus in the metropolitan area of Adelaide. In the circumstances outlined above, it removed from TransAdelaide the right to provide such services in respect of certain areas which are now largely serviced by TT (or TTS) after the PTB granted to it the right to provide such services in respect of similar but not entirely overlapping areas. In those circumstances, in my judgment, TT may properly be described as being a successor transmittee or assignee of the whole or part of the business of TransAdelaide. The right which TransAdelaide had to provide the services which reflected or represented its business has been removed from TransAdelaide and granted to TT by the PTB in the exercise of its statutory functions and powers.
76 Putting aside for the moment the fact that TT has subcontracted the operation of the services it has contracted to provide to TTO, and that TTO has in turn subcontracted the employment of staff involved in the provision of those operations to TTS, in my view there is a clear "identity of activities" between the activities carried on by TransAdelaide in the operation of its business or part of its business and the activities carried on by TT through TTO and TTS. The relevant part of TransAdelaide's business is the operation of the services of passenger transport by bus in at least the North West, East and LeFevre Peninsula areas up to 22 April 2000. Those areas are areas over which, it is agreed, there is now a substantial overlap with the operation of the services by TT in the East West area. (I use those descriptions of area as they are used in the service contracts referred to in pars 22 and 28 above.) On the evidence, TransAdelaide has retained the business of operating passenger transport services by rail (train and tram) in the Adelaide metropolitan area, and as noted it also operates passenger transport services by bus in the area known as Hills-Transit Plus. TTS acknowledged that, in that circumstance, I am bound to follow the Full Court decision in the PP Consultants case and to hold that that "particular bundle of activities" of TransAdelaide, being an identifiable portion of the total activities that constituted its business at 22 April 2000, do constitute part of the business of TransAdelaide within the meaning of s 170MB. I agree that that acknowledgment is properly made. I would in any event have reached such a conclusion on the particular facts in this matter in any event.
77 I am also satisfied, subject to considering the particular position of TTS as a supplier of labour to TTO that there is a substantial identity of activities between that part of the business of TransAdelaide providing passenger transport services by bus in certain areas of the metropolitan area of Adelaide and the business of TT, subcontracted to TTO, of providing passenger transport services by much in areas of the metropolitan area of Adelaide which significantly overlap with areas previously serviced by TransAdelaide. The business provides essentially the same service to members of the public as did the relevant part of the business of TransAdelaide. It does so upon similar general terms to those which applied to TransAdelaide, that is the PTB service contracts are not shown to involve relevantly different functions or responsibilities. The depots made available by the PTB, and the buses made available, are much the same.
78 There are, as the evidence shows, some differences. TT or TTO has leased a separate depot privately, and has also acquired motor vehicles plant and equipment for use in its business from sources other than the PTB. It may not continue to operate from both the Port Adelaide Depot and the Mile End Depot. It provides the contracted services as sixty-three separate routes grouped into twenty service corridors, and on only two of those corridors is the service provided unaltered. In the other eighteen corridors, to various degrees, there have been timetable changes, or route changes, or both. Up to 90 per cent of the bus trips operated by TT or TTO are on an altered timetable or route from the timetables or routes followed by TransAdelaide. In addition, the allocation of work to bus drivers employed by TTS is not done in the same manner and with the employees having the same administrative or home depot as applied whilst they were employed by TransAdelaide.
79 I have had regard to those various matters. Ultimately, however, as Einfeld J stressed in the EN case at [77], the question of substantial identity of activities is one of fact. Having regard to the nature of the activities carried out by TT or TTO, the areas in which those activities are carried out, the nature of the tasks carried out by the bus drivers employed by TTS and provided by TTO to carry out its business, and the terms of the service contract with the PTB, I find that there is a substantial identity of activities between those carried out by TTO on behalf of TT in its business and those previously carried out by TransAdelaide in that part of its business to which I have referred.
80 That finding, together with my conclusion that TT by virtue of its service contract with the PTB in the circumstances has in a practical sense "taken over" part of the business of TransAdelaide so as to qualify as a successor assignee or transmittee of part of TransAdelaide's business, leads me to the conclusion that TT is a successor transmittee or assignee of that part of TransAdelaide's business.
81 TT, however, is not the employer of the bus drivers. By the arrangement referred to, TTS is the employer. It is, therefore, necessary to determine whether TTS falls within the scope of operation of s 170MB(2) in the light of my conclusions thus far. TTS puts the contention that it is a labour hire company, whereas TransAdelaide was and is a service provider, and that as a labour hire company TTS does not in the circumstances fall within the shadow of s 170MB(2).
82 Mere remoteness of any relationship between the former employer and the new employer is not itself a reason to so conclude. Section 170MB(2) clearly contemplates that the new employer may not be the immediate successor transmittee or assignee of the former employer. It would also be surprising if, by the simple device of sub-contracting to a subsidiary company that part of the functions of the former employer as involved the provision of labour, an entity could void what I have found to be the intended operation of s 170MB. If TTS' contention is correct, it would be equally correct if TT directly contracted with TransAdelaide to acquire from it the right to operate passenger transport services by bus in certain areas. The Court should be slow to permit any such processes to avoid the proper application of s 170MB. Einfeld J in the EN case made similar observations at 219 [70].
83 I do not consider that the consequence of the subcontracting to TTS is that for which it contends. Section 170MB(2) must be applied according to its terms. In my judgment, part of the business of TransAdelaide (in effect a subpart of that to which I have previously referred) is the engagement and provision of employees as bus drivers for the purpose of providing passenger transport services by bus under service contract with the PTB in certain areas of the metropolitan area of Adelaide. The findings I have already made indicate that I am of the view that TTS now is engaged in the business of the engagement and provision of employees as bus drivers for the purpose of TT by its subcontractor TTO providing such services also under service contract with the PTB in significantly overlapping areas of the metropolitan area of Adelaide. That activity carried out by TransAdelaide as part of its business was far from an activity peripheral to its business: cp Crosilla v Challenge Property Services [1982] 2 IR 448. In my view it is an activity or bundle of activities which readily falls into the expression "core activities" as explained by R D Nicholson in the Health Care case at 163 [68]. Accordingly, TTS is, in my judgment, a successor transmittee or assignee, although not immediate, of a part of the business of TransAdelaide.