Davies v Barclay Mowlem Construction Ltd [1999] QSC 344

) SUPREME COURT OF QUEENSLAND CITATION: PARTIES: FILENO: DIVISION: PROCEEDING: DELIVERED ON: DELIVERED AT: HEARING DATE: JUDGE: DECISION: CATCHWORDS: COUNSEL: SOLICITORS: Davies v Barclay Mowlem Constructions Ltd GARY JOHN DAVIES (Plaintiff) v BARCLAY MOWLEM CONSTRUCTION LTD (ACN 009830460) (Defendant) No 91040f1997 Trial Division Civil Trial 11 November 1999 Brisbane 27-28 October 1999 Derrington J That at the time of the alleged injury referred to in the statement of claim the plaintiff was not employed by the defendant. CONTRACT - EMPLOYMENT - identity of employer - written contract identifying employer - extraneous indicia of another related party as possible employer - question raised as to identification of employer - whether extraneous indicia and conversation to indicate different employer - whether conversation sufficient to establish collateral contract to true identity of employer - Parol Evidence Rule De Lassalle v Guilford [1901]2 KB 215, 222-3 Heilbut Symons & Co v Buckleton [1913] AC 30 Hoyts Pty Ltd v Spencer (1919) 27 CLR 133, 139 Maybury v Atlantic Union Oil Co Ltd (1953) 89 CLR 507, 517. H J Lyons & Sands Ltd v Houslon [1963] SASR 29,31 Mr J A Griffin QC with Mr N J Thomspon for the plaintiff Mr G D O'Sullivan for the defendant G. O. Shepherd & Co for the plaintiff Phillips Fox for the defendant [I] DERRINGTON J: The plaintiff was injured while employed in Papua New Guinea and sues the defendant for alleged breaches of duty which he says it owed him as his employer. The defendant denies that it ever was his employer and says -- 1 of 8 -- ') ,/ 3 understanding that he was attending exclusively to the affairs of Barclay Bros, which was correct. That understanding would have found expression in his dealings with others such as the plaintiff, and he emphasised that in speaking to the plaintiff he regarded himself as speaking for Barclay Bros. He should be accepted on this, and any suggestion that he may have fallen into the error of speaking in terms that would have implied that he was the defendant's representative has no reasonable foundation and should be firmly dismissed. [5] Both he and the plaintiff are somewhat vague about the details of their conversation in respect of the issues that are relevant here, but they both appeared to be honestly trying to tell the truth to the best of their recollections. Their memories are better, and accord with each other, on matters that would have had more significance to them at the time, that is, the terms and conditions of the proposed employment. Although there is a possibility that he may have simply used a pronoun instead of describing Barclay Bros by name, Mr Loxton's style supports his claim that, as was his practice, he probably explained to the plaintiff the details of the employer's identity. His general experience in these matters also would support that view, and his explaining details of this fact would have been consistent with the common evidence that he explained all other features of the proposed employment in detail. [6] In addition, the unusual aspects of the identity of the employer may well have prompted him to give some explanation in such an interview. The work was to be in Papua-New Guinea and it was necessary for Barclay Bros to have a local associate for the enterprise. In this case it was a local company named Lakaka Ltd, and the vehicle for the joint enterprise was yet another company, Aelium, which was to be the plaintiffs nominal employer, but whether Mr Loxton named it is somewhat doubtful. . [7] The plaintiff is intelligent but not a sophisticated businessman and, although he denies that they were mentioned at the time the clarification of these details would probably not have had for him the same importance that they had for Mr Loxton; and, if as is likely, Mr Loxton spoke in terms of the involvement of the company he was plainly representing, the plaintiffs incorrect assumption may have further deflected him from any interest in that point. At least he probably would not have paid much attention to any mention of the involvement of Barclay Bros rather than the defendant as the relevant party to the project. In any case, Mr Loxton's evidence appeared to be superior in reliability. [8] It might be added that while it took some little effort to encourage the plaintiff to give evidence as nearly as he reasonably could in direct speech when recounting conversations, which was of a fairly critical importance to his case on this issue, he should not be criticised for that, and it did not in the end affect his evidence or his credibility. In the course of time he generally complied quite well and his evidence should be accepted as a verbatim account of the relevant conversations so far as his memory could reasonably provide it. [9] This interview took place in about July 1995, and not long after that the plaintiff had occasion to ring Mr Loxton. He was not available, but his secretary, Ms Retschlag, told the plaintiff that the job was available. In order to make this call the plaintiff had had to consult the telephone directory for the number, and the only -- 2 of 8 -- 4 relevant listing was in the name of the defendant. He did not search for Barclay Bros. It is argued that this listing inferentially confirmed to the plaintiff that the defendant was the contracting party. He may have drawn that conclusion, but whether, in the surrounding pre-contractual circumstances, it was enough to amount to a representation as to the identity of the contracting party is another thing. [10] In the following month a letter offering employment was sent to the plaintiff for acceptance. It was signed by Mr de Luca for and on behalf of "Barclay Bros (PNG) Pty Ltd", which was also named at various prominent places in the heading and at the commencement of the text of the document as an owner, with Lakaka Ltd, of Aelium. The offer appears to have been made by Barclay Bros, although the letter was headed with Aelium's name, and the employment offered was as a building supervisor for Aelium. It is of course quite possible that one party would employ him to do work for the other but it seems to have been intended that for Papua-New Guinea purposes, Aleium would be the nominal employer. Barclay Bros was also mentioned in para 23 of the letter, which carries possibly contradictory implications that the plaintiff would be the employee of Barclay Bros on the one hand and of Aelium on the other. However, it is not necessary to untangle the issue of which of the two was to be the employer. The important thing is that the defendant was not mentioned, and "Barclay Mowlem" was mentioned only in a management capacity which was clearly distinguished from any role of employer. [11] When he read the offer, the presence of Aelium's name aroused some curiosity in the plaintiff, and he rang Mr Loxton. The latter does not recollect this conversation but that is not surprising as it would have had little significance for him at the time. For the most part, he does not contest it. The plaintiff says that his concern was to be employed by an Australian company, but he did not say that to Mr Loxton. He said, "I'm confused as to why there's a different name at the top of the page; Aelium Construction. Who is that?" Mr Loxton replied, "Don't worry about that. We have to form a joint venture with a local company to get contracts in PNG. It's no concern of yours." It is not suggested that he identified whom he meant by "we". c c [12] The plaintiff did not question the involvement of Barclay Bros, and the defendant (" was not mentioned. Although much stress has been placed on this conversation by ',,,-- the plaintiff, its scope was extremely limited to the role of Aelium, which did not -- touch upon the role of the defendant or Barclay Bros, except to the extent that the plaintiff applied his assumptions to it. Of far more significance is the fact that the offer was made by Barclay Bros, who appeared to be the employer, and this was not questioned. [13] Mr Loxton's advice not to be concerned about Aelium because the company he represented would effectively be the employer was perfectly true. It would be easy to understand his use of the expression ''we'' without identifying precisely who that was, for the offer had been made by Barclay Bros and the point of the plaintiff s interest was the new party, Aelium. Although Barclay Bros was widely and significantly mentioned in the contract as involved in the role of employer, that did not agitate any enquiry or discussion by the plaintiff. This may be contrasted with the absence of any mention of the defendant except perhaps in a management role. If the plaintiff had the defendant in mind as the real contracting party, which is -- 3 of 8 -- ) ) 5 doubtful, he did not say so, and Mr Loxton's answers were understandably equivocal to him only because of these things. [14] Mr Loxton's explanation, which was in effect that he would not have spoken in terms other than as representing Barclay Bros, has the merit of consistency with the title used by Mr de Luca in signing the letter of offer on behalf of Barclay Bros as the employer in the contract, and with what followed. Before· the plaintiffs departure, he received a letter from Ms Retschlag who described herself as "Secretary to General Manager PNG." Though its letter head was "Barclay Mowlem", it plainly spoke three times of the plaintiffs employment with Barclay Bros. Further, during the period of his employment in Papua-New Guinea, the plaintiff was told on several different occasions that his employer was Barclay Bros; and when in the following year he resigned, he even addressed his letter of resignation to that entity. He did not question this at any time. His enquiry on the latter occasion as to the proper addressee was no doubt prompted by the mention of Aelium in his contract, and the advice he received was in accordance with Barclay Bros acceptance of responsibility for his employment. These matters all support the view that Mr Loxton's response to the plaintiffs earlier limited query of Aelium's involvement was both apposite and fair. [15] It might be remarked in this context that the appearance of Aelium's name on the plaintiffs tax group certificate has no substantive implication in this context since that was an understood technical arrangement for other purposes. It would not have affected any collateral arrangements between the plaintiff and the defendant, if that had existed, implying that in consideration of the plaintiffs entry into the contract, the defendant would act as the de facto employer in all relevant matters. The weakness of the defendant's reliance on indications that Aelium was the real employer is demonstrated by the many indications by Barclay Bros that it had that status. Of course, that does not solve the issue as to the defendant's position. [16] Conversely, for similar, but not the same reasons, the presence of the name and logo of "Barclay Mowlem" on the plaintiffs pay slips have limited significance. Although that name is prominent and no other relevant name appears, that entity is not shown as the employer and as it has been observed, the plaintiffs group certificate shows Aelium as the employer. Consequently the name on the pay slip is consistent with and implies no more than that Barclay Mowlem attended to the payment of wages in accordance with its managerial responsibilities which the plaintiff knew or ought to have known because its role was referred to in his contract. [17] Much of the evidence led by the plaintiff as to the interaction between the defendant and Barclay Bros that is suggestive of confusion is similarly of little utility. First, there is strong evidence that the company involved in the business of Aelium was in fact Barclay Bros, and those involved in the relevant conversations with the plaintiff were always acting for and intending to act for Barclay Bros; and there is no evidence of value to the contrary. The terms of the contract document objectively establish this, quite apart from any other indications of which there are many. The defendant was not involved in fact, except by way of providing services for Barclay Bros. -- 4 of 8 -- 6 [18] There is no evidence that the defendant or its agents made any conscious representation that it would be the plaintiffs employer. There is just no evidence that Mr Loxton was its agent with a general or ostensible authority that would include his contracting on its behalf. In law he was certainly the defendant's agent, but his authority was limited to conducting the affairs of Barclay Bros on its behalf alone. The position was simply that his services were sold to Barclay Bros to act as its agent. It was not represented, and the plaintiff did not know, that he was employed by the defendant. [19] Secondly the interaction that the plaintiff says causes confusion was not known to him, so it cannot be relevant to any suggested pre-contractual communication to him identifying the defendant as the contracting party. As it is plain that Barclay Bros intended to be the party involved in the contract, it is only pre-contractual communications to the plaintiff that are relevant, unless some confusion had affected the terms of Mr Loxton's communication to the plaintiff; but that did not happen. [20] There is certain other evidence that should be mentioned. An employment separation form was provided to the plaintiff by the Barclay Mowlem group showing the defendant as the plaintiffs employer. This was an error by a temporary clerk who misread the computer data due to her inexperience and the fact that the data was in the records kept by the Barclay Mowlem organisation for Barclay Bros under their service agreement. It does not have the significance in this issue that may have attended the issue whether the defendant in fact participated in the contract, but the evidence of the latter is strongly in the negative. In any case, this was simply the mistake of a temporary clerk and was of no evidentiary force whatever. It is a huge leap to imply similar confusion to Mr Loxton. . [21] There is another piece of evidence with similar inconsequence. After he had terminated his employment the plaintiff obtained a medical report for worker's compensation, which was addressed by the examining doctor to "Barclay Mowlem". This may have been prompted by something the plaintiff himself said, and in any case, it was only addressed to the party designated in the contract to perform managerial activities associated with the employment, and which in fact provided some services for which it was paid. It has no relevant significance. [22] Apart from an unintended implication to be drawn objectively from its communications to the plaintiff, which will be considered below, it is difficult to see how in the absence of estoppel the defendant can be bound by the contract as a party. IfMr Loxton was not its agent nor its ostensible agent for this purpose, then the requirement that an agent must make it clear that the principal is to be responsible for any contractual obligations 1 has no application here. Mr Loxton was acting as agent for Barclay Bros, and he made it clear that it was his principal for whom he was then acting. Any failure on his part, though it is difficult to find any, would fall upon the principal for whom he was in fact acting as agent in that activity, that is Barclay Bros. H J Lyons & Sands Ltd v Houslon [1963] SASR 29,31. c c c c -- 5 of 8 -- ' ) ) ) ) 7 [23] For his part, even if he believed that the defendant had been the negotiating party, the plaintiff did not at any time question the many indications that Barclay Bros was to be the contracting party on what might be described as the Barclay Mowlem side. This omission is also consistent with his failure to question the involvement of Barclay Bros in the contract or the indications that it was to be his employer. [24] Although he had some difficulty in explaining it, it is apparent from his evidence that although he was aware of this technical identification of Aelium as his nominal employer, he claims that he believed that the contract was actually with the defendant but, under a collateral arrangement expressed in this form for the defendant's convenience without affecting the true position. He initially formed the assumption of the defendant's involvement from limited and somewhat equivocal sources that were not entirely satisfactory. With a vague general knowledge of the defendant's presence and activity in the building industry, he seems to have assumed that by going to a large building that bore its name and logo, he would be dealing with it rather than with another company within its group; and this assumption was fortified when he later rang Mr Loxton by using its telephone number. These features were slight evidence on which to found any serious conclusion, though a provisional notion as to the point may well be understood. But this does not explain why or how he continued to have that view when the contract with which he was presented clearly showed that apart from Aelium the only party involved in the contract was Barclay Bros. He acknowledges that he saw its name on the contract but did not enquire about it. [25] He further says that when Mr Loxton explained the presence of Aelium in the contract by reference to the need to have a local partner in the enterprise, he did not construe Mr Loxton's "we" as applying to Barclay Bros, which he said was a Papua-New Guinean company, which would not need a local partner. This does not explain how the defendant would need Aelium if it already had Barclay Bros as well as Lakaka in the enterprise; nor why he would not wish to know of Barclay Bros's involvement in the contract. On this issue he was unconvincing, but his fault should still be regarded as honest reconstruction that caused him problems through its logical difficulties, which he probably recognised, at least in part. [26] This inconsistency is exacerbated by his subsequent conduct both before and after he went to Papua-New Guinea, when he accepted, without demur or question, statements both written and oral that Barclay Bros was his employer. [27] From the whole of his approach it is very probable that he had some understanding at the time he signed the contract that Barclay Bros was a related company within the Barclay Mowlem organisation and that he was contracting with it in that capacity; but that within those parameters he was not concerned with precise identity. Even if this were not so, if he still had some unarticulated and unclarified erroneous assumptions based on his interpretation of the significance of the "Barclay Mowlem" name and logo on the building and the listing in the telephone book, these were insufficient grounds for a concluded view or his continued belief after he saw the identity of the parties to the contract. If he did not understand the true position already, his failure to enquire further perpetuated his error. Nothing Mr Loxton said encouraged the error and at best for the plaintiff he misconstrued that gentleman's information because of his own erroneous preconception and his failure to enquire properly. -- 6 of 8 -- 8 [28] In the result, the allegation that when he signed the contract he believed that he was contracting with the defendant rather than with some entity in the Barclay Mowlem group is very doubtful and the probabilities are quite strongly against it. It certainly was not established on the evidence. [29] In any case, his alleged belief is not sufficient to establish the contract as claimed. As rectification is not sought and estoppel was abandoned, and as the defendant was never expressly identified as the contracting party, in order to succeed he must establish words and conduct of the defendant objectively implying an agreement that matched his belief. [30] In this he again relies only on the implications he drew from the name of the building and the details in the telephone book. But in an objective assessment the defendant's conduct in this respect cannot be limited to what the plaintiff knew, for , < he cannot limit the defendant's general public communication of facts to what he C chose to notice. For example, if without informing the defendant he drew an inference partly from the public name on the building, he can hardly ignore that those coming to the building were plainly informed by signs that the place where he was interviewed was the office of Barclay Bros, and that the defendant had no office on that floor. Fairly regarded, the signs overall did not represent to the public C that those coming to Mr Loxton's office would be contracting with the defendant. Competing inferences defeat any justifiable reliance upon the implication for which the plaintiff contends. [31] The telephone entry on which he also relies as feeding his earlier belief is similarly devoid of any such inference, either alone or with the earlier factor, for the earlier factor in its full context carried no implication which could give colour to the latter. [32] This analysis is directed to the implications flowing from the defendant's public conduct in these ways, but it must be read in the context of its entire conduct and not in the limited way experienced by the plaintiff. It should be limited only to what would be manifest to a person in the plaintiffs position who would take reasonable enquiry as to the identity of the other contracting party. [33] On that measure, the implication from these factors advanced by the plaintiff is not established, but even it if were, again it could not be justified as more than provisional. The terms of the contract should have dispelled it or at least put such a party on full enquiry as to the point. If it is also brought into consideration, as it must, then the whole of the defendant's conduct to the time of contract cannot have implied, objectively as distinct from the plaintiffs interpretation, that the defendant was a contracting party. [34] In argument, the plaintiff would try to add a factor described as "dealings were with employees of Barclay Mowlem who undoubtedly would have used the term "Barclay Mowlem" constantly (as they did in evidence)." However, the plaintiff has not said that there was any such relevant usage in his dealings with them; and it is wrong to speculate that Mr Loxton would have used the expression when he was referring to Barclay Bros. As it has been shown, the contrary is likely to have been the case. c c -- 7 of 8 -- .. • ) ) ) ) • 9 [35J For its part, the defendant also relies on the parol evidence rule and a provision in the contract acknowledging that it contains all the tenus of the plaintiffs employment and confinuing that he did not rely on any representation other than those set out in the letter of offer. The plaintiff argues that these do not apply to negotiations with a party outside the written contract, that it was not the contract with the defendant, and that the entry into the written contract was only an arrangement that was collateral and subsidiary to the contract with the defendant. 2 In such cases the parol evidence rule does not have application to exclude a contract such as that for which the plaintiff contends. J However, on the above finding that the contract correctly represented the full transaction, this investigation is not relevant. [36J The other history of the matter takes it no further. The plaintiff engaged in his employment under the contract and tenuinated it without any difficulty as to the identity of his employer. This issue would never have appeared except that apparently to avoid the Papua-New Guinea jurisdiction, he commenced this action in Queensland. Presumably because of some doubt as to jurisdiction, he did not join Barclay Bros or Aelium in it although the contract was made in this jurisdiction and this issue of identity was raised well within the period of limitation. It appears that he has prudently commenced alternative proceedings against them in Papua- New Guinea. [37J It may also be observed, in case it has any relevance, that the plaintiff tenuinated his employment, not because of the injury alleged in this action, but because of his discontent in not receiving a certain pay increase. [38J I THEREFORE DETERMINE that at the time of the alleged injury referred to in the statement of claim the plaintiff was not employed by the defendant. Although not referred to in the plaintiffs submissions, Heilbut Symons & Co v Buckleton [1913] AC 30 per Moulton LJ at 47 refers to this class of arrangement. See also Hoyts Pty Ltd v Spencer (1919) 27 CLR 133, 139. De Lassalle v Guilford [1901]2 KB 215, 222-3; Maybury v Atlantic Union Oil Co Ltd (1953) 89 CLR 507, 517. -- 8 of 8 --