Kabuaua v CCB Envico Pty Ltd [2020] KIHC 25; Civil Case 50 of 2018 (13 October 2020)

IN THE HIGH COURT OF KIRIBATI 2019

CIVIL CASE NO. 50 OF 2018

[WINIUEA KABUAUA PLAINTIFF
[
BETWEEN [AND
[
[CCB ENVICO PTY LTD DEFENDANT

Before: The Hon Chief Justice Sir John Muria

22 November 2019; 19 February & 13 March 2020

Ms Elsie Karakaua for Plaintiff
Ms Botika Maitinnara for Defendant

JUDGMENT

Muria, CJ: By a writ of summons dated 27 August 2018, the plaintiff claims damages for future loss of earnings, general damages for pain and suffering, loss of convenience and amenities, loss of pecuniary prospects, physical disability and disfigurement. The plaintiff also claims punitive damages, 15% interest from the date of the issue of the writ and costs of the action. The plaintiff claims that he was employed by the defendant at the time of the accident. The plaintiff brings his claim pursuant to section 5 of the Workmen’s Compensation Ordinance (Cap 102) of the Laws of Kiribati.

Brief Background

2. It would be helpful to set out the brief background of the case. The plaintiff is said to have been employed by the defendant since 12 August 2013. The defendant is an overseas company operating in Kiribati in Government projects, including maintenance of sewage pipes (150cm) in the ocean.

3. On 11 November 2017, during the course of his employment, the plaintiff was injured when one of the pipes carried by a bulldozer fell, rolled and landed on his thighs. The plaintiff’s thighs and legs were fractured and was hospitalized for several weeks.

Plaintiff’s Case

4. The plaintiff’s case is that he was employed by the defendant at the time he was injured. He deposed to the fact that it was the defendant who was giving the plaintiff and other employees instructions on their employment and what was expected from them.

5. At first the defendant was paying the plaintiff and others their salaries. One named Emile Schutz was the one giving the plaintiff and other employees their salaries. It was after one year that One Stop was paying the employees their salaries. However, the plaintiff and other employees did not do any work for One Stop who were simply distributing the wages for the workers on pay days.

6. The plaintiff’s engagement was with the defendant’s project but it was One Stop who was paying the workers’ salaries under a Labour Agreement signed between the One Stop and Defendant. The plaintiff contends that no employer/employee status existed between One Stop and the plaintiff.

Case for Defendant

7. The case for the defendant is simply that they were not the employer of the plaintiff. According to the defendant it was One Stop who employed the plaintiff and that One Stop was an independent contractor. It is the defendant’s contention that no legal relationship existed between itself and the plaintiff.

8. It is also submitted on behalf of the defendant that the plaintiff is not entitled to compensation under the Workman’s Compensation Ordinance. This, it is said, is because the plaintiff is not qualified as a “workman” under section 5 of the Workman’s Compensation Ordinance.

Issues

9. There are three issues raised by the plaintiff which the Court must determine in this case. The first is whether the plaintiff was employed by the defendant at the time of the accident. Secondly, if the defendant was the employer of the plaintiff, whether the defendant should pay compensation to the plaintiff under the Workman’s Compensation Ordinance, and thirdly, whether the plaintiff is entitled to other damages.

Determination

10. The determination of whether the defendant was the employer of the plaintiff or not in this case is crucial. However, in order to determine whether an employment relationship existed between the defendant and the plaintiff, a number of factors have to be considered. Chiefly among those factors is the right to control the work to be done and how the work should be done:
Short –v- J and W Henderson Ltd (1946) 39 BWCC 62. It is thus important to consider this tests of control in this case in order to determine if an employment relationship existed between the defendant and the plaintiff. Thus as Lord Thankerton emphasized in the abovementioned case that superintendence, and control are decisive quality of the relationship between the employer and employee.

11. The other factors which also help to demonstrate the existence of an employment relationship between an employee and employer are the power to select the employee, the payment of salaries and wages, the right to suspend or dismiss. However, as pointed out in Short –v- J and W Henderson Ltd, the most important test is one of the right to control.

12. In the present case, it must be determined who had the right to control the work which the plaintiff was performing and how the work was to be done. The plaintiff’s contention is that his employer was the defendant, not One Stop. The defendant, on the other hand stated that the plaintiff was employed by One Stop and, not the defendant.

13. I will come back to the question as to who was the employer of the plaintiff. For now I will briefly deal with the relationship between the defendant and One Stop.

14. The defendant was an overseas company engaged by the Government to undertake Government projects. In the present case the defendant was engaged by the Government of Kiribati to undertake the Project on maintenance work on sewage pipings in Kiribati, in particular, in South Tarawa.

15. The Project director with the defendant company was one Alistair Cusack from Melbourne, Australia. The work on the Project appeared to have started in 2013 and the plaintiff was one of those employed by the defendant in
August 2013. One Stop had not come into the picture then. The plaintiff’s evidence, undisputed, is that his wages were then paid directly to him by the defendant who was then regarded by the plaintiff as his employer. There is absolutely no evidence from the defendant to counter that piece of evidence from the plaintiff.

16. One Stop came into the equation in 2016 when an Agreement, “the Labour Agreement” was signed between the defendant and One Stop on
18 February 2016. Under that Labour Agreement, the defendant and One Stop agreed that One Stop shall provide labour only for work on the South Tarawa Sanitation Improvement Sector Project as directed by the defendant’s Site Manager and/or Project Manager, including Site Supervisors. In return for the provision of services, One Stop would be paid fees by the defendant.

17. The common law tests of employment are set out in Halsbury 4 Ed. Vol. 16 para 501. These are:

“(a) The master’s power of selecting his servant;

(b) the payment of wages or other remuneration;

(c) The master’s right to control in a general manner the work to be done;

(d) The master’s right of suspension or dismissal”.

18. However, as the learned author also pointed out at paragraph 502, that whether an employer and employee relationship exists is a question of fact, although the contractual relationship between them is a matter of law. The above tests stated in Halsbury’s Laws and the case of Short –v- J and W Henderson Ltd were applied in the case of Tri-Ed Association –v- Solomon Islands College of Higher Education [1986] SBCA, 7; [1985-1986] SILR 173 (1 May 1986).

19. By virtue of clause 5.1 of the Labour Agreement, One Stop was an Independent Contractor. As against the defendant, Clause 5.2 states that One Stop and workers were not employees of the defendant. On the face of it, the plaintiff was not an employee of the defendant.

20. Under Clause 4.1 of the Labour Agreement, One Stop was also responsible for paying the wages, training, vetting and welfare of the plaintiff. Again on the face of it, the plaintiff would be considered an employee of One Stop rather than the defendant.

21. When one considers the four tests of employment under common law, three of them clearly point to One Stop rather than the defendant as the employer of the plaintiff. The control test, however, in my view, did not fall squarely on the defendant, although the defendant did have some control over the work to be done by the plaintiff. One Stop, under the Labour Agreement, did have some general control also over the workers, by ensuring the suitability of the workers to do the work required of them, as well as ensuring that the workers were able to perform the duties required of them.

22. In my view, the right to exercise general control of the work and workers in this case was a shared between the defendant and One Stop with the latter having more direct control and superintendence over the workers and their work performance in the Project: see Short –v- J and W Henderson Ltd.

23. Since February 2016, by virtue of the Labour Agreement between the defendant and One Stop, there was created a mutual obligation between One Stop and the plaintiff whereby the plaintiff supplied his labour to One Stop for the use of the defendant and in return One Stop paid the plaintiff for that supply of labour. The Labour also created an obligation on One Stop to provide employment to the plaintiff who in return was obliged to provide his labour.

24. Thus in my judgment, and on the evidence before the Court, I find and hold that in law, the defendant was not the employer of the plaintiff since
18 February 2016. The accident complained of in this case occurred on
11 November 2017 at which time the defendant was no longer the employer of the plaintiff.

25. This finding is fatal to the whole of the plaintiff’s claim in this case. Consequently, the plaintiff’s claim against the defendant cannot stand and must be dismissed with costs to be taxed.

26. ORDER:

1. Plaintiff’s claim dismissed;
2. Costs to the defendant to be taxed, if not agreed.
   

Dated the 13^th day of October 2020

SIR JOHN MURIA
Chief Justice