Commercial Union Workers' Compensation (NSW) Limited v Gayl Lynette Clayton & Ors

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

CA 40984/99 CC 8086/95 POWELL JA STEIN JA FITZGERALD JA Wednesday, 18 October 2000 COMMERCIAL UNION WORKERS' COMPENSATION (NSW) LIMITED v Gayl Lynette CLAYTON & ORS

This is an appeal by the Commercial Union Workers' Compensation (NSW) Limited against a decision of Judge Hughes in the Compensation Court in which he made an award in favour of Ms Clayton (the first respondent). The award concerned an accident she sustained in 1993 when she suffered serious injuries to her left hand while assisting her de facto husband Mr Botfield (the second respondent) in the grading of seeds.

His Honour determined that the real issue in the case was whether Ms Clayton could establish that she was a worker within workers' compensation legislation. The judge found the evidence sufficient to establish the legal relationship of master and servant between Mr Botfield and Ms Clayton. The credit of Mr Botfield was not impeached and his Honour accepted him as a credible witness.

The appellant submits that his Honour erred in finding that Ms Clayton was a worker, and erred in not permitting questioning of Ms Clayton regarding her credit and honesty after the injury. The appellant submits that the questioning would have supported the allegation that Ms Clayton and Mr Botfield had conspired to make a false claim for compensation.

Held (Stein JA, Powell and Fitzgerald JJA agreeing)

Although additional cross-examination on Ms Clayton's credit could have taken place, the acceptance of Mr Botfield's evidence as truthful meant that his Honour was entitled to find that the relationship of master and servant was established. The lack of credit of Ms Clayton, acknowledged by his Honour, becomes of little consequence, indeed even if she had been further discredited.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

CA 40984/99 CC 8086/95 POWELL JA STEIN JA FITZGERALD JA Wednesday, 18 October 2000 COMMERCIAL UNION WORKERS' COMPENSATION (NSW) LIMITED v Gayl Lynette CLAYTON & ORS JUDGMENT 1 POWELL JA: I agree with Stein JA. 2 STEIN JA: This is an appeal from a decision of Judge Hughes in the Compensation Court. On 24 November 1999 his Honour made an award in favour of the first respondent, Ms Clayton, concerning an accident she had sustained on 14 June 1993 on a property near Walgett. She suffered serious injuries to her left hand when it caught in an auger. 3 The de facto husband of Ms Clayton, the second respondent, Mr Botfield, would go from farm to farm grading seeds. The machinery with which he carried out the operation required two operators. Mr Botfield usually hired casual labourers to assist him. However, on occasions, Ms Clayton assisted. This is what was occurring on 14 June 1993 when the accident happened. 4 From the commencement of the hearing before his Honour it was apparent that the real issue in the case was whether the applicant, Ms Clayton, could establish that she was a worker within workers' compensation legislation and in a master and servant relationship with Mr Botfield. The appellant insurer's case was that they were not in such a relationship and Ms Clayton was assisting her de facto husband as a volunteer at the time of the accident. Alternatively, they were partners. 5 In her evidence-in-chief, Ms Clayton said that she was employed by Mr Botfield on a casual basis and, in particular, was so employed on the day of the accident. She said that she was paid $100 a day, as were other labourers. This was paid by cheque signed by Mr Botfield. She agreed that no tax was deducted, nor were records kept, and no taxation return was lodged because she believed that she was below the tax threshold. 6 Ms Clayton was then cross-examined by counsel for the appellant insurer. She confirmed that she worked for Mr Botfield on a casual basis from 1984. She was shown some cheque butts produced to the court by Mr Botfield. She agreed that the cheque account was, for all intents and purposes, the sole source of funds for the family and that the account was used by Mr Botfield for his business. A large number of the cheque butts were written to 'cash'. Some of these had the word 'Gayl' on them. Ms Clayton agreed that she had added 'Gayl' at a time later than when the cheques were drawn. It was suggested to her that she added her christian name to the cheque butts to support her claim. Also, it was suggested that the relevant cheques were for domestic expenses and not wages. She denied both suggestions. 7 Ms Clayton was then cross-examined about a Workcover medical certificate which she had signed on 21 June 1993. She filled in Part A of the document and noted her employment as 'farm hand' and her employer as 'Trevor Botfield'. She agreed that she had originally written 'as above' but crossed it out and put in Mr Botfield's name as employer. She was aware that the certificate was provided to the insurer. 8 It was put to her that she did this to support her claim that she was actually employed by Mr Botfield. She denied this. 9 She was asked: Q. 'You have always been honest, particularly since this injury?' She answered 'No, Sir'. 10 Counsel then asked whether it was a fact that she had pleaded guilty in May 1997 to an offence. This was objected to by counsel representing the worker and also Mr Botfield's counsel. 11 Counsel for the appellant pressed the question as highly relevant to the credit of the witness, and likely also to be relevant to the credit of Mr Botfield. His Honour stated that Ms Clayton's own answer that she had not always been honest since the accident meant that she had called her own credit into question. He rejected the question sought to be asked. 12 The cross-examiner then turned his attention to Ms Clayton's honesty before the injury. This was initially objected to but the objection was withdrawn. Counsel was permitted to proceed and the witness agreed that she had been convicted on a charge of false pretences at Coonabarabran Local Court in April 1989 and placed on a bond. Counsel then cross-examined on other issues. 13 Later, counsel sought leave to cross-examine the worker further as to her credit and particularly her conviction in 1997. He said to his Honour: The conviction was in respect of an attempt by the applicant, which was admitted by her before the court, to raise money on the basis of a forged document. That document being a document from my insurer as to the availability of certain funds in the hundreds of thousands of dollars and a bank advanced some money, some of which was spent before the fraud was discovered. The lady was charged and some years later was dealt with by the court. It does only go to credit but it arises, that is the offence, arises out of the present facts. That is, entitlement or no entitlement. So it does not go the question of Mr Botfield's liability but it certainly does, in my submission, go to the issue of credit. 14 The proposed line of questioning was objected to and counsel for the insurer added: I only gave your Honour the most skeletal facts. The document from the - the undisputed facts were that a document from the insurer was utilised by the applicant to induce a bank to advance some moneys. 15 Counsel made it plain that he wished to pursue the matter as going to Ms Clayton's credit and her evidence of employment by Mr Botfield. His Honour's response was that she had already admitted that she was not a truthful person and how much further did he need to proceed. Ultimately, his Honour refused to allow the questions. 16 Mr Botfield gave evidence that he employed Ms Clayton on a casual basis. He said that he paid her for the work she performed and most of the cash cheque butts endorsed with 'Gayl' were for her wages. 17 Counsel for the insurer cross-examined Mr Botfield. Mr Botfield agreed that he did not keep any records apart from his cheque books and that he had never kept a wage book. He also agreed that all domestic and business expenses were taken out of his cheque account. He denied that all of the cheque butts marked 'Gayl' were for domestic expenses. He said that most of them were for wages. 18 Mr Botfield was not asked one single question to support the allegation in the insurer's pleading that he and Ms Clayton had 'conspired, connived and/or colluded with the intention of making a false claim for compensation'. He was not asked any questions about his awareness of Ms Clayton's dishonesty, or her Coonabarabran conviction before the accident. He was asked no questions about his knowledge of Ms Clayton's honesty since the accident, when she had already agreed in cross-examination that she was not honest. 19 Mr Botfield was not asked about his knowledge of any loan obtained by Ms Clayton from the State Bank at Walgett on the basis of a forged document on the appellant's letterhead or the impending settlement of the compensation claim for $564,000. He was asked no questions as to his knowledge of the State Bank advancing substantial loan funds to Ms Clayton in 1994 on the faith of the forged letter. 20 In his judgment, his Honour noted that the challenge to the relationship of master and servant between the worker and Mr Botfield was on the basis of a conspiracy between them to make a false claim. 21 His Honour noted that it was not contested that Ms Clayton was actually working to assist Mr Botfield in grading chick peas at the time of the accident. Two farmers had given evidence of Ms Clayton assisting Mr Botfield at times.

22 His Honour then said: There was some evidence and admissions by Mrs Clayton that before and after the accident she had been convicted of offences concerning an attempt to unlawfully obtain sums of money. It was urged on me by the third party that I was not to accept Mrs Clayton as a person of credit. 23 This was a reference to Ms Clayton's evidence of not always being honest, particularly since the accident and also to her acknowledgment of her conviction in 1989 of false pretences. It was not strictly correct to say that she had been convicted of an offence after the accident since his Honour had refused to allow cross-examination on this matter. 24 His Honour went on to say, although not in these words, that he would not accept Ms Clayton's evidence unless it was corroborated. However, his Honour noted that no allegation of dishonesty was made against Mr Botfield and he accepted the evidence of Mr Botfield. Where Mr Botfield's evidence was consistent with that of Ms Clayton, her evidence was to be accepted. Where they differed, Mr Botfield's was to be accepted. 25 According to his Honour, the adding of the name 'Gayl' to the cheque butts by Ms Clayton was not particularly significant. 26 His Honour found that the evidence was sufficient to establish the intention to form the legal relationship of master and servant. Ms Clayton was not a volunteer nor a partner. 27 I should say at once that both respondents concede that his Honour should have allowed the cross-examination of Ms Clayton to take place. The circumstances were such that it came within the exception in s 103 of the Evidence Act 1995. The cross-examination as to credit should have been permitted as having 'substantial probative value' in the sense that it could rationally affect the assessment of the credit of the witness. 28 However, in the absence of any attempt to support the allegation that Mr Botfield had conspired with Ms Clayton to make a false claim for compensation (and to give false evidence) by asking any relevant question or any question concerning Mr Botfield's knowledge of Ms Clayton's dishonest activities, his Honour's finding on Mr Botfield's credit must stand. It was a finding which was open to be made.

29 There was no reason why questions along these lines could not have been asked. However, Mr Botfield's credit was not impeached. 30 The acceptance of Mr Botfield's evidence as truthful meant that his Honour was entitled to find that the relationship of master and servant was established. The lack of credit of Ms Clayton becomes of little consequence, indeed even if she had been further discredited. 31 This aspect of the appeal should be dismissed. The appellant faintly argued that his Honour's decision that the first respondent was a worker employed by the second respondent was unreasonable and perverse (relying on Hill v Green (1999) 48 NSWLR 161 at paras 228 - 245 per Fitzgerald JA). However, this court is bound by Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139. Moreover, it cannot be said that his Honour's conclusion on the employment relationship was one which no reasonable person could have reached. 32 The appeal should be dismissed with costs. 33 FITZGERALD JA: I agree with Stein JA.

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