Davidson v Toohill t/as The Beach Hotel

JUDGMENT:

The applicant in these proceedings makes a claim for deafness as a consequence of his alleged employment or deemed employment with the respondent.
The applicant is a musician who at the relevant time played with a group of musicians known as "Steve Russell Blues Power" which apparently played "Blues Rock" music. The applicant played in this band from approximately 1993 as a drummer.
In 1994 the band began playing at the respondent's premises known as the Beach Hotel. The arrangement at that time was that the band would play at this venue every second Friday night. The band would play from 8:45 pm until approximately 12 midnight. The applicant received for three hours of work the sum of $90. The money was given to one of the members of the band and it was split three ways. The money was obtained from someone behind a bar which had apparently been set aside for that purpose. The applicant never personally received the money as he never went to the bar to get the full amount on any occasion. The money was signed for and then split between the three band members.
The applicant did perform other work as a drummer during 1994 nearly every Saturday night. On these occasions he performed with other artists. It was a four hour engagement and the applicant received approximately $120.
At some stage in 1994 the band changed its name to "Extreme Blues" when it performed at the Beach Hotel but continued to work every second Friday night until some time in 1998. Additionally at some stage during this period the applicant began doing regular Thursday night work in addition to the work every second Friday. This change occurred some time in 1996. The Thursday night band, which was made up of the three members of "Extreme Blues" and an additional band member went by the name of "Shoe Phone". The reason for the change was that a different kind of music was played on Thursday which required a piano player.
The applicant brought his own drums. The other band members used their own instruments by way of guitars and keyboards. The PA system was supplied by the Hotel. The same sound engineer operated the system who was paid by both the band and the hotel on a 50 per cent basis.
The Thursday night arrangement also continued until some time in 1998. The applicant did occasional engagements at other venues with the Friday night band ("Extreme Blues"). These particular engagements were not greatly remunerative apparently because of the high cost of hiring a PA system. These additional engagements, although occasional, throughout the period nonetheless did indicate to me that the band were prepared to accept additional engagements in other venues. At some time in 1998 the applicant left the band as a consequence of a disagreement in the band.
The applicant never had any involvement with the financial arrangements. He never picked up or distributed the money available between the other members of the band. Arrangements in regard to the playing of music at a particular venue were organised by someone other than himself. Usually this arrangement appears to have been made by Steve Russell. The applicant would be informed that there was a gig on at a certain place and as a member of the group he would go along if he was available to play. If a band member was ill they would get someone else to fill in for him. The applicant himself was in this position, although very occasionally. The applicant agreed that the proprietor of the hotel would not really have any idea who was going to turn up on the night as he left it to the band to organise. It was for the band to fulfil the right players to produce the music that was required.
At some point of time Steve Russell left the band and another gentleman called Kent Jackson became the leader or arranger. This Kent Jackson or another band member called Justin told the applicant when the work was on and where it was to be done. The payment at the end of the night was distributed with no tax taken out of it. To the applicant's knowledge no written contract about securing attendances there upon the night was made. The hotel proprietor had no say in what was played or how indeed it was played. The clothing worn was optional and it was the same sort of arrangement had when the applicant played at the Oriana Hotel or the Oceanic Hotel.
The applicant has held himself out to be a musician for many years. The applicant had no contact with the respondent except for the purposes of exchanging formalities. Any discussion on how or what to do, or where to do it - if indeed there was any such discussion - was never with the applicant. During the period, the applicant worked with various performers at an RSL club and may have done some casual jobs with other bands besides the previous bands mentioned. Plainly it seems he filled in with other bands over the four year period.
A letter by the respondent to the applicant's solicitor was tendered in the applicant's case (Exhibit AX5). It reveals that the respondent booked the band "Extreme Blues" at a fee of $350 which was given to the band leader Kent Jackson. The sum was paid for the band and the PA operator but how it was divided amongst the group did not involve the respondent.
There is no issue between the parties in regard to the question of injury, or the extent to which that injury results in a compensable lump sum. The issues therefore to be determined relate to the question of whether there was a contract of service or a contract for services in the context of much discussion in relation to this issue in a long line of authority.
In a dispute relating to the correct categorisation, the applicant is the party asserting that there is a contract of service and thereby has the onus of establishing the necessary intention on the balance of probabilities. The principles to be applied in determining whether an applicant is or is not a worker within the meaning of the Act were the subject of revision in Commercial Union Workers' Compensation NSW Ltd v Smith (1994) 10 NSWCCR 267, Connelly v Wells (1994) 10 NSWCCR 396 and Articulate Restorations & Developments Pty Ltd v Crawford (1994) 10 NSWCCR 751. More recently the High Court has revisited this question in Hollis v Vabu Pty Ltd [2001] HCA 44. The leading authority in relation to which rules are to be applied is to be found in Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 at 24, 28-29, 36.
In Graham v Chick NSWCA unreported, 28 July 1995 (BC9505094) at 2-3 Kirby ACJ stated: The search in each case is to ascertain the "essence" of the relationship between the suggested worker and employer. The Court is obliged to look to the "totality of the relationship between the parties". See Stevens, above, 29. No single criterion is determinative. Nor can generalities determine the particular case. What is usually or typically the case in a given trade relationship must give way to the evidence about the proved relationship in the case in question. A sole test of "control" or even of "the right to control" is not now accepted as conclusive. See Stevens, 24. By the same token the right of control will often remain "the surest guide of whether a person is contracting independently or serving as an employee". See Stevens, 36. Cf Queensland Stations Pty Ltd v Federal Commissioner of Taxation (1945) 70 CLR 539, 552. In conducting its search for the "totality" or "essence" of the relationship the Court will keep in mind the great changes which have occurred, for technological, social or other reasons, in the nature of employment between the time when the control test was expressed as an attribute of the law of "master and servant" to today's much more variable and flexible employment markets. See Connolly, above, 84; Articulate, above, 375. See also Workcover Authority of New South Wales v Billpat Holdings Pty Ltd and Ors [(1995) 11 NSWCCR 565].
The degree of control to which the person performing the work is subject is still described as a prominent factor but, as already indicated, it is not regarded as determinative. Other relevant matters are said to include the way in which the work is remunerated, the provision of equipment, the arrangement made regarding hours of work, provision for holidays, the obligation to work, the arrangements regarding taxation and the capacity to delegate the work. See Gleeson CJ in Connelly, supra, at 398.
In the choice between the conclusion that the applicant was an employee of the respondent and a conclusion that he was a member of the band hired to play music, it is my conclusion that the more appropriate characterisation of the relationship between the parties is of the latter. I attach significance in this respect to the circumstances that it was for the band to provide the personnel, that it was they who were required to engage or provide the musicians on their own account, that they could select whomsoever they chose for however long they were required. So much is to be illustrated by the arrangements that were made when the applicant himself was on some occasions ill.
The right of dismissal indicates a right of control over performance. Corresponding rights, in the case of an independent contract, are not subject to the control and performance of the work arising only in the case of a breach of a fundamental term of the contract. However, simply to refer to a right of dismissal as implying a contract of service is misleading. The circumstances of the applicant leaving the band had nothing to do with any discourse or arrangement with the respondent. He had a dispute with the members of the band.
The right of dismissal is significant where it can be a right related to a right to dismiss for disobedience of directions in relation to the right to control the manner of performance of the contract in question. In respect of control, however, the search is not for actual control but for the ultimate authority to control the work involved. Recent authority has indicated and acknowledged the need for sufficient flexibility to adapt to changing social circumstances by shifting the emphasis in the control test from the actual exercise of control to the right to exercise it so far as there is scope for it even if it be in incidental or collateral matters. Hence it is the "totality of the relationship" between the parties which must be considered as the relevant factor. See Mason J in Stevens, supra, at 28 and 29. See also Zuijs v Wirth Brothers Pty Ltd (1955) 93 CLR 571. Therefore on this basis the answer may be indicated in ways which are not always the same and which do not always have the same significance. See Stevens, supra, at 36. So much is to be illustrated by arrangements whereby those performing the tasks engaged in that which was highly specialised and skilled. See Zuijs v Wirth Brothers, supra. Moreover, the applicant was free to, and did, play music at other venues. Even though this occurred on infrequent occasions there is sufficient evidence for me to conclude that he held himself out as being available to do so.
There are a number of associated aspects which occur in connection with the type of contract involved in these circumstances. A discussion in relation to the right to delegate performance of the work appears in the second edition of Mills at 145 and 146. This discussion, however, does not appear in the later editions. The discussion relates to the right of a particular person who enters into the arrangement to delegate performance of the work to someone else or to employ others to assist in the performance of the work by the engagement of a number of persons to work as a group for the performance of the work and where the engagement is affected through one of their number. These circumstances involve one central principle, that if there is to be a contract of service it requires personal service by the worker himself. If the contractor is free to do the work himself or to employ other persons to carry it out, it is a contract whereby the contractor has undertaken to produce a given result. In Neale v Atlas Products (Vic) Pty Ltd (1955) 94 CLR 419 it was held that tilers were not servants as they were not required by the terms of the contract to perform personally the contractual work.
As indicated in this case, the members of the band were simply made up by the choice of the remaining band members or if one was ill by an arrangement with someone else to take his place. At no point of time was the respondent involved in any of these arrangements. There has been no evidence by either the band leader or the respondent in relation to what was actually discussed at the time of the engagement save for what appears in Exhibit AX5.
Mills argues (2nd Edition at 145-6) that if the contractor is free to have the work performed by others there is no element of control. In any event the absence of any right of delegation does not ensure the element of control is present. Where a team of men work together on a series of short jobs, either for the one principal from time to time as work is available or with a succession of persons, such a situation is open to two interpretations: The member of the group who made the contract may be the employer of other men in the group, and his contract with the principal will be one for services to be performed by his employees, while in other cases the facts will lead to the conclusion that the member of the group has made the contract as agent for himself and the other members of the group so that they all become workers employed by the principal. This line of authority (at 146), while dealing with loose types of arrangements between the principal and a group of men in each case, in my view maintained sufficient ultimate control in the principal to form the basis of finding a contract of service. I do not consider that the same right of ultimate control over the members of the band is to be found in the respondent.
It is to be noted that the applicant did not found his case nor make submissions based upon what is contained in the second edition of Mills.
The applicant has made a submission based on the Musicians' Hotels Award 1982. It is submitted that the definition of "employee" contained in the award was broad enough to include the applicant as he was paid the salary for the work performed at the respondent's premises. It was submitted that the relationship between the applicant and the respondent was more readily characterised as a contract of service by looking at the terms of the award. There is an absence of evidence as to whether the nature of the arrangement made was pursuant to the provisions of the award. In these circumstances the existence of the award in my view does not lend any assistance in determining the characterisation of the actual agreement made between the parties. A passing reference was made to the existence of the relevant award in Odgers v Union Theatres Ltd [1931] WCR 99. The decision, however, turned on the question of the control test and had no indication as to the relevance or connection of the award to that determination. Therefore I do not think that the existence of the award assists in determining whether there is a contract of service in these circumstances.
The alternative submission made on behalf of the applicant related to the question of whether the applicant came within the provisions of schedule 1 clause 2 of the Workplace Injury Management and Workers Compensation Act 1998. In this regard Bainton AJA in Scerri v Cahill (1995) 14 NSWCCR 389 at 399 indicated that the applicant must establish: 1. that he was party to a contract with the respondent to perform work; 2. that work exceeds $10 in value; 3. that the work is not work incidental to a trade or business regularly carried on by the applicant in his own name or under a business or firm name; and 4. that the applicant has neither sublet the contract nor employed workers in the performance of it.
In relation to the first ingredient there must be an intention to create legal relations and mutuality or contractual consensus. The presence of both these factors is to be determined objectively. See Lindeboom v Goodwin (2000) 21 NSWCCR 297 at 302-4 and Cudgegong Soaring Pty Ltd v Harris (1996) 13 NSWCCR 92 at 101. As I have already indicated the applicant had no contact with the respondent except for the purposes of exchanging formalities. There was no evidence from either of the band leaders in relation to the nature of the legal relations or contract that was entered into.
Exhibit AX5 indicates that in regard to the band "Extreme Blues" a fee was paid for that band. The sum was intended for the payment of each member of the band and the PA operator.
In Zuijs v Wirth Brothers, supra, at 574 the majority were of the opinion that this provision was entirely inappropriate for the kind of contract in question in that case. There are features of that case that are similar to this one. The court indicated that you could not satisfy the condition of "where a contract to perform any work exceeding $10 in value" by a contract of indefinite duration for repeated performances of an act on a trapeze. This aspect of the decision was later criticised by Stephen J in a minority judgment in the matter of Hay v Liverpool City Raceway Pty Ltd (1979-80) 143 CLR 672 at 675 in terms similar to the criticism by Glass JA in the Court of Appeal. However, Glass JA felt bound nonetheless by the statement of the Full High Court in Zuijs. The statement in Zuijs, supra, at 574 was obiter as the majority found in that case a contract of service. Nonetheless it does in my view have some value in describing the nature of the contract and an expression of the High Court's view.
The more significant aspect has to do with the exclusion "(not being work incidental to a trade or business carried on by the contractor in his own name, or under a business name or firm name)". The words in brackets are an exception to the subclause, and form a single concept, rather than the sum of several separate components. See Mills at 37,754.2 (2002 edition). The full court in Turner v Stewardson [1961] WCR 176 at 177 unanimously regarded the interpretation of the excluding words as well settled by Dixon J in Humberstone v Northern Timber Mills (1949) 79 CLR 389 at 401-2. The business may be one which ranges over a variety of skills. The provision … draw[s] a distinction between two classes of independent contractors. There are on the one hand those whose relation to the principal is special or particular, and on the other hand there are those who perform contract work successively or concurrently for customers or others. In the first class … [it] stands outside the course of the general business of the contract or the general practice of his trade … [On the other hand] a contractor who conducts as a matter of course a definite business which he carries on systematically or holds himself out as ready to do so … comes within the exclusion and is, therefore, outside the protection of the Act .
The applicant must have had at the date of entering into the contract with the respondent other opportunities for playing or holding himself out as being available to play music for others. Those who are in business for themselves and who systematically and regularly accept work to be done under contract or who hold themselves out as open to be employed under contract to do so are not to rely for compensation upon the principal whose contract work they are performing at the moment of injury. See Turner v Stewardson, supra, at 177.
I have already commented on the fact that the applicant had on other occasions accepted engagements at other venues, albeit infrequently, and in my view had held himself out as being available to play at other establishments and other occasions. In the tax return (Exhibit AX4) the applicant is described as a "musician" and derives his income from that occupation. The contract with the respondent and the applicant's participation in that was incidental to his business as a musician.
A person may regularly carry on business in his own name whether he advertises or otherwise holds himself out as a contractor. It was suggested that there was no regularity in the applicant engaging at other venues. However, it is instructive to note Wescott J in Higgins v North Coast Theatres & Drive-Ins Pty Ltd [1973] WCR 54 at 59, which was applied by Neilson J in Byrne v Mulholland (1995) 11 NSWCCR 739, where it was held that the fact a business is carried on part-time or intermittently is irrelevant to the issue of whether the applicant is a deemed worker under schedule 1, clause 2 of the Act. There was nothing to suggest that the contract with the respondent was entered into otherwise than in the normal course of the applicant's business.
I consider therefore for these reasons that the applicant is not entitled to the benefits of the section. In my view the evidence does not support the existence of the necessary elements to support the applicant's submissions in this regard.
For the above reasons I make an award in favour of the respondent. Mr D S Stanton instructed by McDonald Johnson appeared for the Applicant Mr S L C Flett instructed by Sparke Helmore (N'tle) appeared for the Respondent

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