Nand v Croney [1998] QCA 367

Court of Appeal (Qld)|1998-11-13|Before: Before McPherson J, Pincus J, Jones J, Mr P

1 On 15 March 1991 the respondent/plaintiff (hereinafter "the plaintiff") was injured in the course of his employment. On 10 July 1998 in an action in the District Court at Brisbane he was awarded damages and interest totalling $102,865 for those injuries.

2 The applicant/defendant (hereinafter "the defendant") has appealed against that decision on the grounds that the finding that he was at the relevant time the employer of the plaintiff was incorrect. He seeks by this application firstly, a stay of execution of the judgment and secondly, leave to adduce further evidence on the hearing of the appeal.

3 The plaintiff alleged that the defendant was, at the relevant time, his employer and the owner of a tree lopping business trading as "Neil's Tree Lopping Service". The defendant alleged that though he was at one time the plaintiff's employer, he had in January 1991 sold the business to one Raj Kumar (hereinafter "Kumar"). Kumar was not made a party to the action.

4 The learned trial judge in closely detailed reasons, found on balance of probabilities that the defendant was the employer. The defendant however did not have a policy under the relevant Workers' Compensation legislation and, it seems, nor did anyone else in respect of the respondent's employment.

5 At trial evidence on the question of employment came principally from the plaintiff. The plaintiff's father, Mr. Loftus Croney, also gave evidence but only on a limited issue. It was to the effect that after his son was injured the defendant and Kumar visited him at his home, and the defendant offered to pay $3,000 to his son "to help out". A similar offer was later repeated directly to the plaintiff at the hospital which in the way it was presented had the appearance of an offer being made jointly by the defendant and Kumar.

6 The issue of who was the plaintiff's employer at the relevant date was a difficult one and required the learned trial judge to weigh conflicting oral evidence and to apply that to contemporaneous material. The following chronology is drawn from his Honour's findings -

7 April 1986 Mr. Ali in partnership with his wife registered business name "Neil's Tree Lopping Service".

1987 The defendant commences to work for the business.

1989 Inala branch of the business is established with the defendant as manager. Telephone contacts for the business were those of the defendant and Mr. Khan (a friend of Mr. Ali).

September 1990 Mr. Ali leaves to reside in Fiji - defendant left in charge of the business. Defendant approaches Kumar to work for him.

October 1990 Kumar suggests the plaintiff (then a Year 12 student) be engaged to work on weekends.

October - Defendant engaged in full-time employment elsewhere - Kumar

December 1990 and plaintiff working together in the business.

mid-January 1991 Mr. Ali seeks an accounting - business unprofitable - instructs defendant to wind it up. Defendant takes some equipment in lieu of moneys owing to him.

late January 1991 Defendant commences full-time employment as a mechanic.

February 1991 Newspaper advertisements for "tree lopping specialists". Telephone contacts being those of defendant and Kumar.

6-20 March 1991 Advertisement showing changed telephone contacts viz. Kumar and the defendant.

Kumar said his contact number was placed first because of the fact that the defendant was at work during the day. Defendant said the change reflected the fact that Kumar had taken over the business and he was lending support by having his number included.

March 1991 Visits by defendant and Kumar to the plaintiff in hospital and the plaintiff's father.

7 Having regard to all the evidence the learned trial judge came to the view that he was left with three possibilities -

(i) after Mr. Ali ceased to run the business, the defendant in fact continued to carry it on treating it as his own;

(ii) the defendant transferred the business to Kumar by selling him some of the equipment and allowing him to "take over" the advertisement; and

(iii) that Kumar and the plaintiff were engaging in work on their own behalf outside any employment arrangements.

8 The learned trial judge found that neither the defendant nor the witness Kumar was particularly reliable. His Honour accepted the plaintiff's evidence that he always regarded the defendant as the person from whom he took instructions. The plaintiff did not even know Mr. Ali who in fact had left for Fiji before he became involved. Until February 1991 the plaintiff would usually go to the job site with the defendant and Kumar. In February/March 1991 the practice was for the plaintiff to go to the job site with Kumar. This was probably due to the fact that the defendant was now working full-time elsewhere. However, the defendant was regularly at the job sites during this period. When present, it was the defendant who collected the money from the customer and paid the plaintiff his entitlement. If the defendant was not present Kumar collected the money but he gave it to the defendant who then paid the plaintiff. Relying particularly on this evidence his Honour found that the defendant was the employer.

9 Since the prospects of success for the appeal is a matter for consideration in the application for the stay of execution, the further evidence should be considered first.

10 Further Evidence. The further evidence which it is sought to lead on the appeal comes from two persons - Kamal Lata Croney and Shainaz Bano Ali. The application relies on O.70, r.10 of the Rules of the Supreme Court which is in the following terms:

"10. Amendment: further evidence. The Court of Appeal shall have all the powers and duties as to amendment and otherwise of the court or a judge appealed from, and shall have full discretionary power to receive further evidence upon questions of fact, which evidence may be taken either by oral examination in court, by affidavit, or by deposition taken before an examiner or commissioner.

Upon an appeal from a judgment after the trial or hearing of the case or matter upon the merits, such further evidence, save as to the matters subsequent as aforesaid, shall not be admitted except on special grounds."

11 The test of what amounts to "special grounds" for the introduction of fresh evidence on appeal is authoritatively and compendiously set out in Brisbane City Council v. Mainsel Investments Pty. Ltd.[1] citing Langdale v. Danby[2] as follows:[3]

"Three conditions must be fulfilled. 'First it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial: second, the evidence must be such that, if given, it would probably have an important influence on the result of the case, although it need not be decisive: third, the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, though it need not be incontrovertible'".

Bearing that test in mind, the examination of the two affidavits which identify the evidence said to satisfy this test must be undertaken.

12 Kamal Lata Croney is the plaintiff's stepmother and is also the daughter of Kumar. Because of these associations it is said she is a reluctant witness. Mrs Croney asserts, in paragraph 4 of her affidavit, that Kumar agreed to purchase the tree-lopping business from the defendant by the end of January 1991 but gives no facts on which such an assertion could be based. There was never any suggestion of a written document. If Mrs Croney was present during any discussions when such an agreement was reached one would expect that with reasonable diligence she could have been identified as a potential witness.

13 In paragraph 6 of her affidavit, Mrs Croney asserts that Kumar seized the "complete operation" of the tree-lopping business in or about late January 1991 and for that reason the truck was parked at Kumar's residence. This assertion does not necessarily follow from that fact. Moreover it is contrary to the newspaper advertisements appearing in February 1991 and again in March 1991 showing in both instances the defendant as a telephone contact point for the business.

14 In paragraph 7, Mrs Croney asserts that the plaintiff was employed by Kumar after the truck and equipment were handed over to Kumar. The fact that Kumar kept the truck and equipment at his premises is consistent with his Honour's findings about the use of the business vehicles. It does not lead to a conclusion that the vehicles and equipment had then been sold. His Honour found that the defendant's own evidence on this event was that the sale fell through at some time after the plaintiff's accident. The balance of that paragraph contains mere comment and a statement as to the deponent's father's intention neither of which is admissible.

15 In paragraph 8, Mrs Croney refers to the plaintiff's role in negotiating with customers and to factual matters which might go to a question of contributory negligence. Neither reference is germane to any matter raised in the appeal.

16 In paragraph 9, Mrs Croney expresses an opinion as to the issue to be determined on the appeal. It is clearly not admissible.

17 In paragraph 10, Mrs Croney gives her reason for her prior silence and the reason why she now comes forward. This would only be relevant if her affidavit disclosed some admissible evidence which would satisfy the test in Mainsel. In our view it satisfies neither the first or second arms of that test and consequently requires no further consideration.

18 Shainaz Bano Ali is the daughter-in-law of Kumar having married his son Arvind in November 1990 in Fiji. She came to Brisbane in January 1991 and lived with Kumar's family at Inala for the next 18 months.

19 In paragraph 3, Ms. Ali refers to being present at a meeting between Kumar, his wife and their son, Umesh Kumar during which they agreed that Kumar should purchase the tree-lopping business from the defendant. This does no more than show Kumar's intent - a fact already known - but does not assist in determining that the business had in fact been taken over by Kumar as at 15 March 1991.

20 In paragraph 4, Ms. Ali sets out a hearsay statement about a conversation between Kumar and the defendant. It is clearly inadmissible.

21 Paragraph 5 of Ms. Ali's affidavit is not relevant to the issue. Paragraphs 6 and 7 of the affidavit set out facts which are consistent with the findings of the learned trial judge made in respect of the way in which the business was conducted prior to the plaintiff being injured and does not therefore constitute fresh evidence.

22 The remarks in paragraph 8 of the affidavit are simply comment and opinion which are not receivable in evidence.

23 The affidavit of Ms. Ali does not satisfy the second line of the test in Mainsel's case.

24 In the end result we have come to the view that the totality of the admissible evidence set out in both affidavits would not be likely to have an important influence on the result of the case. We would refuse the application.

25 Stay of Execution. In respect of this application, a point of some importance arises. The judgment was entered against the defendant on 10 July 1998. He, jointly with his wife, is a registered proprietor of land situated at 2 Phillip Place, Forest Lake on which is situated the matrimonial home. He values the home at $189,000 which is subject to a mortgage debt of $80,000. The defendant is employed as a mechanic and earns $500 per week.

26 Judgment having been perfected on 13 July 1998, an application for a warrant for execution was filed in the Court Registry two days later. The warrant was issued on 22 July 1998 and was executed against the defendant's interest in the land on 3 August 1998. No further steps towards the sale of the property were taken prior to the service of the notice of appeal on 26 August 1998.

27 The plaintiff was at all times after the judgment was entered, entitled to seek payment of the judgment amount, interest and costs from WorkCover,[4] a body corporate which took over the assets and liabilities of the Workers' Compensation Board ("the Board").[5]

28 The plaintiff's injury having occurred in 1991 his entitlements were to be determined by reference to the Workers' Compensation Act 1990 ("the Act").[6] The plaintiff was entitled pursuant to s.183(1) of the Act to recover against the Workers' Compensation Fund ("the fund").[7] This was a statutory right quite independent of the existence of a policy of insurance whereby an employer is indemnified. See Wilson v. Austral Motors (Qld.) Pty. Ltd.[8] where McPherson J. (as he then was) considered the equivalent provisions of the Workers' Compensation Act 1916. He said (at p.777):

"The right of the worker under s.9A to receive payment out of the fund in respect of a liability established against his employer at common law for injury to the worker appears to operate as a statutory charge on the fund, although in other respects the legislative scheme operates in much the same fashion as ordinary non-compulsory insurance inter partes. The employer is required to insure against liability (s.8) and there is a prescribed form of policy in favour of the employer. The right to a payment out of a fund which is dependent upon the existence of `a legal liability in the employer to pay damages in respect of that injury' is qualified in s.9A(1) by the words `except an injury in respect whereof the employer is required by some other Act to provide against such liability as prescribed by such other Act'".[9]

29 Here the plaintiff is eligible to receive the benefit of the statutory charge by reason of the finding that there was a liability in his employer to pay damages in respect of the injury which occurred in the course of his employment. The only condition which the plaintiff himself had to fulfil was to notify the Workers' Compensation Board of his claim as is required by s.185(1) of the Act. That sub-section required that the plaintiff "serve on the Board a copy of the Writ or other process by which the claim is made and before any further step is taken to file an affidavit of such service".

30 It appears from Mr Hodgson's affidavit that the Board was in fact served with the originating process on 15 March 1994 and there is no suggestion that the plaintiff did not otherwise comply with the requirements of the sub-section. Accordingly it appears that there is no barrier to the plaintiff now receiving from the fund the full amount of his judgment, interest and costs.

31 The point of this appeal is to argue that the liability for the plaintiff's damages should shift from the defendant to Kumar who the defendant asserts was the plaintiff's employer at the relevant time. Kumar also did not hold a policy of insurance under the Act. If the appeal were successful then the plaintiff's right to recover from the fund would be exactly the same.

32 The application is made pursuant to O.70, r.28 which relevantly provides that an order granting a stay of execution "may be made as to the whole or any part of the proceedings in the cause or matter, and may be made upon such terms as the Court of Appeal or the Judge of appeal granting the stay may think fit". Power to make such orders arise as well from the inherent jurisdiction of the Court.

33 On its face the discretion to grant a stay is unfettered. Over time various epithets, such as "special" or "exceptional", have been used to describe the circumstances which call for the exercise of discretion. This Court has accepted as correct the test that the applicant bears the onus of showing that it is an "appropriate" case for a stay to be granted.[10] In Alexander v. Cambridge Credit Corporation Ltd.[11] the Court of Appeal in New South Wales made an extensive examination of the matters relevant to the granting of a stay of execution. It identified the existence of an insurer required to indemnify the plaintiff as a legitimate consideration in the exercise of the discretion. The Court said (at p.700) -

"Whilst it is true that the existence of insurance is irrelevant to the liability of the opponents in law, they might not, depending on their terms, be irrelevant to fixing conditions for the grant of a stay. It is not at all unusual for conditions to be imposed for the payment of part of a verdict pending appeal, in the knowledge that this part will be paid by the insurer of the judgment debtor. However, such orders are not normally made where liability is seriously in dispute as between the parties or where liability to indemnify is disputed by the insurer."

34 We regard the position here as somewhat stronger for the applicant. This is not a case where the judgment debtor has indemnity but where the person entitled to recover has an apparent right to do so from the fund. Perhaps a need for some caution exists by reason of the fact that WorkCover is not a party to the proceedings before the Court.

35 The fact that the plaintiff has readily available a means of having his judgment satisfied in full is a factor of significant weight in the exercise of the discretion which determines this part of the application.

36 It was argued on behalf of the plaintiff that the defendant will in practical terms, have to pay the judgment because WorkCover is likely to pursue a claim against him pursuant to s.50 of the Act. What course WorkCover would follow in the circumstances is not known. Whether WorkCover would adopt an approach more favourable to the defendant than the plaintiff's intended execution against the defendant's property is a matter on which this Court cannot speculate. Similarly the Court could not speculate as to whether WorkCover would elect to be joined in the proceedings and pursue the appeal to determine whether the learned trial judge's finding as to the identity of the employer was correct.

37 The next matter which was suggested to be material to the exercise of discretion were the serious financial detriment the execution of judgment would have on the defendant against the rather less prejudice to the plaintiff which in any event could be compensated for by payment of interest. There is at least the prospect that the defendant's house could be sold resulting in an irreconcilable loss if the appeal is successful.

38 The prospects of success of the appeal is not a matter which the Court considering a full stay application should generally speculate about.[12] Making an assessment of whether the appellant has an arguable case is undertaken to ensure the appeal has not been lodged simply to delay execution. This factor is less relevant in this case where the plaintiff has the alternative means of satisfying his judgment.

39 Weighing then the competing interests of the defendant who faces immediate execution against his only substantial asset against the interests of the plaintiff who has an alternative means to recover under the judgment, the balance, in our view, favours the plaintiff.

40 The stay should be limited to a stay of the execution against the defendant's interest in his house and land described in the application. This would remove the respondent's concern that he not be precluded from pursuing his statutory right to be paid which right is subject to any right that WorkCover might have should it take over conduct of the appeal proceedings.

41 In our view the balance of convenience clearly favours the granting of the stay limited in the way we have indicated above.

1. Application for leave to adduce further evidence made on the notice of motion dated 28 August 1998 is refused.

2. Execution of the judgment mentioned in the notice of motion against the defendant's interest in a house and land at 2 Phillip Place, Forest Lake, is stayed until determination of appeal no. 7315 of 1998 or further order.

3. Costs of and incidental to the notice of motion are to be costs in the appeal.

[3]. Mainsel Investments Pty. Ltd. at p.215.

[4]. Pursuant to ss.330-1 of WorkCover Queensland Act 1996.

[7]. This section is in terms equivalent to s.9A (1) of the Workers' Compensation Act 1916 to which later reference will be made.

[9]. The statutory equivalents to the sections referred to in this citation are:

1916 Act:s.8(1), s.9A(1); 1990 Act: s.44(1) and (2), s.183(1).

[10]. Williams v. Chesterman & Anor. C.A. No. 74/1992, unreported.

[12]. See Cambridge Credit case (supra) at p.695.

Compensation Act 1990

Compensation Act 1916

At a glance

Court

Decision date

Before

Source

Judgment (77 paragraphs)

Parties

Legislation Cited (3)