Sammartino v Commissioner Foggo

REASONS FOR JUDGMENT (delivered ex tempore) THE COURT 1 Mr Sammartino, the prosecutor, worked as a driver for Mayne Nickless Ltd ("Mayne Nickless"), the third respondent. Following an allegation of misconduct on the part of Mr Sammartino and investigation into that allegation, Mayne Nickless terminated the services of Mr Sammartino. He then lodged with the Australian Industrial Relations Commission ("the Commission") an application for relief, alleging that he was an employee of Mayne Nickless and that his employment was terminated in contravention of s 170CE(1) of the Workplace Relations Act 1996 (Cth) ("the Act"). That subsection relevantly provides: Subject to subsection (5), an employee whose employment has been terminated by the employer may apply to the Commission for relief in respect of the termination of that employment: (a) on the ground that the termination was harsh, unjust or unreasonable; or (b) on the ground of an alleged contravention of section 170CK, 170CL, 170CM or 170CN; or (c) on any combination of grounds in paragraph (b) or on a ground or grounds in paragraph (b) and the ground in paragraph (a). 2 The application was not resolved by conciliation (see s 170CF(1)) and accordingly it was referred to the Commission for determination pursuant to s 170CF(2). 3 When the matter came on for hearing before Foggo C, the first respondent, the point was taken that Mr Sammartino was not an employee, but was an independent contractor of Mayne Nickless and accordingly was not entitled to the benefit of an arbitration under section 170CG or a remedy under section 170CH. Foggo C found that Mr Sammartino was not an employee within the provisions of the Act, but he was an independent contractor and as such he was "precluded from the jurisdiction of the Act in relation to the provisions of s 170CE". 4 An application for leave to appeal was made to a Full Bench of the Commission. The right to appeal from such a decision is to be found in s 45(1)(g), which relevantly provides: Subject to this Act, an appeal lies to a Full Bench, with the leave of the Full Bench, against ... (g) a decision of a member of the Commission that the member has jurisdiction, or a refusal or failure of the member of the Commission to exercise jurisdiction, in a matter arising under this Act. Reference should also be made to s 170JF, which is in the following terms: (1) An appeal to a Full Bench under section 45 may be instituted by any person who is entitled under section 170JD to apply for the variation or revocation of an order under this part. (2) For the avoidance of any doubt, an appeal to a Full Bench under s 45 in relation to an order made by the Commission under subdivision B of Division 3 may be made only on the grounds that the Commission was in error in deciding to make the order. 5 Whatever be the general nature of an appeal under s 45 (as to which see the Construction, Forestry, Mining and Energy Union v Giudice (1998) 159 ALR 1) it seems tolerably clear that an appeal under s 45(1)(g) in respect of a decision of a member of the Commission refusing or failing to exercise jurisdiction can only succeed if an error, whether of law or fact, can be shown to exist. The Commission appears to have formed a different opinion. 6 In determining how it should approach the appeal, the Commission referred to one of its earlier decisions, Westend Pallets Pty Ltd v Lally (1996) 69 IR 1 at 10, where the Commission held in relation to an appeal in respect of a decision under the former section 170ECA (appeals from the making of an award in a consent arbitration): The central question for consideration in a s 170ECA appeal is whether the Commission member at first instance was in error in deciding to make the award subject to appeal. In our view the meaning of error in this context is a legal error or a fundamental misconception of the facts, ie an error in the House v The King sense. Accordingly in order to succeed on appeal the appellant must establish that the member at first instance made a legal error or it acted on a wrong principle, given weight to irrelevant matters, failed to give weight to relevant matters or made a mistake as to the facts or that the decision was plainly unreasonable or unjust. Following its reference to Westend the Commission went on to say: We are of the view that these observations apply equally to section 170JF of the Act as presently constituted as they did under section 170ECA of the former legislation. The concept of error is the same in each case. The Commission continued: Accordingly, we have considered whether or not Foggo C in her decision made a legal error or had acted on a wrong principle, given weight to irrelevant matters, failed to give weight to relevant matters, made a mistake as to the facts, or that the decision was plainly unreasonable or unjust. 7 First the Commission was in error in proceeding on the basis that the proposed appeal was brought under s 170JF and not s 45(1)(g). Second, House v The King (1936) 55 CLR 499 summarised the principles permitting interference by an appellate court of the exercise of a discretionary judgment and was not concerned with an appeal from a decision where all that was required to be shown was an error of law or an error of fact. The High Court said at 504-505: The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that if they had been in the position of the primary judge that they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court at first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred. 8 See also Lovell v Lovell (1950) 81 CLR 513 at 519, where again the point is made clear that the appellate tribunal has no right to substitute its discretion for the discretion entrusted to the primary tribunal in the absence of relevant error. The question whether a person is an employee for the purposes of Division 3 of the Act is not in any way a discretionary decision. The decision maker must first ascertain what is meant by the word "employee" when used in Division 3. Then the decision maker must make findings of fact and determine whether the facts as found establish whether the person is an employee or not. No exercise of discretion is involved. 9 On an appeal from such a decision, if leave to appeal is given, the Commission is plainly not confined, in its consideration of the case, by principles that are found in cases such as House v The King (supra). In dealing with the appeal, the Commission is under a duty to consider all of the proven facts and those facts that have been admitted, and any inferences to be drawn from those facts, to arrive at its decision. It is also under a duty to determine the content of any point of law upon which its decision might depend. If, in undertaking any of these tasks, it finds that the Commissioner has made an error of law or an error of fact, it can exercise its powers under s 45(7). 10 It will find an error of law or an error of fact if the Commission reaches a different conclusion on the facts or on the law than that arrived at by the primary decision‑maker. Further, what must be shown in order to succeed on an appeal will plainly have a bearing on whether leave should be granted. 11 The Commission held that it was not satisfied that Mr Sammartino has met the requirements pursuant to House v The King (supra) for leave to appeal to be granted and accordingly it refused leave and dismissed the appeal. The prosecutor seeks the issue of a writ of mandamus and a writ of certiorari directed to the Commission. He also seeks the issue of similar writs directed to Foggo C. 12 What has been said thus far shows, prima facie at least, that the Commission misdirected itself as to the manner in which it was required to conduct the appeal if leave was granted. This error prima facie affected its determination of the question whether leave should be granted. Ordinarily the writs sought should be issued against the Commission. If such writs were issued, we would not grant similar relief against Foggo C, even if we thought that she had committed an error of a type that was amenable to a prerogative writ. 13 The reason we would not grant writs against the Commissioner is that her decision was taken on appeal and, if the writs are directed to the Commission, it will determine the application for leave to appeal and, if leave be granted, the appeal itself in accordance with law. Thus no purpose would be served in having writs issue against the Commissioner. 14 It is urged that the writs should not issue against the Commission because, when the reasons for its decision are read in their totality, it is apparent that the prima facie view that we have formed as to the error demonstrated is incorrect and that the true position is that the Commission undertook its task in the manner that it was required to do. The following passages in the reasons for decision are relied upon to make good this contention. First there is the following sentence: We are in no way convinced either that Foggo C was not entitled to come either to the conclusions of fact which she came to [that is that Mr Sammartino was not an employee] or to the conclusion that the balance of the indicia established that Mr Sammartino was an independent contractor. The next passage reads: We should not be taken for ourselves to endorse each of the findings of the Commissioner as distinct from finding that those findings were reasonably open to her. On our view of the applicable principles to the Commissioner's determination of the jurisdictional issue on the facts presented to her that determination was not only reasonably open it was correct. 15 What these passages demonstrate, when taken together with the passages to which we have already referred, is that the Commission erred in its approach to the application before it. Once the Commission indicated that it was treating the Commissioner's decision as an exercise of discretion, the clear inference is that the Commission did not appropriately examine the facts of the case to determine, for the purposes of considering whether leave to appeal should be given, whether the Commissioner had erred in law or fact. It could only properly undertake this task if it bore in mind at the outset how it should consider the material. It is extremely unlikely that it did so. 16 Finally, it was said that the writs should not issue because the Commission would inevitably hold that leave to appeal should be refused. We disagree. If the Commission bears in mind what the prosecutor must establish in order to succeed on an appeal and perhaps also takes account of the general importance of the case, we are far from satisfied that leave will inevitably be refused. Accordingly, we would grant the relief sought against the Commission. The orders will be: 1. A writ of certiorari issue to the Australian Industrial Relations Commission (the Commission) removing the decision of the Full Bench of the Commission of 22 September 1998 in application C No 36038 of 1998, being an application by Mr Sammartino for leave to appeal pursuant to s 45 of the Workplace Relations Act 1996 (Cth) (the Act) into this court quashing it. 2. A writ of mandamus issue to the Commission, directed to it to hear and determine, in accordance with law, application C No 36038 of 1998, being the application by Mr Sammartino for leave to appeal under s 45 of the Act.