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Cite as: [1998] 1 IR 34, [1997] IESC 9

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Henry Denny & Sons (Ireland) Ltd. v. Minister for Social Welfare [1997] IESC 9; [1998] 1 IR 34 (1st December, 1997)

The Supreme Court

Henry Denny & Sons (Ireland) Limited v The Minister for Social Welfare

1 December 1997

Hamilton CJ

I agree with the judgments about to be delivered but I believe it would be desirable to take this opportunity of expressing the view that the courts should be slow to interfere with the decisions of expert administrative tribunals. Where conclusions are based upon an identifiable error of law or an unsustainable finding of fact by a tribunal such conclusions must be corrected. Otherwise it should be recognised that tribunals which have been given statutory tasks to perform and exercise their functions, as is now usually the case, with a high degree of expertise and provide coherent and balanced judgments on the evidence and arguments heard by them it should not be necessary for the courts to review their decisions by way of appeal or judicial review.

Keane J

Demonstrators who offer passing shoppers free samples of wine, cigarettes, sausages or whatever are a familiar feature of supermarkets today. The net issue in this case is as to whether they are properly regarded in law as engaged in their tasks under a "contract of service" or a "contract for services".

The significance of the distinction is that if such a demonstrator is regarded as being employed under a contract of service, then he or she is an insurable person for the purposes of the Social Welfare Acts, 1993 to 1997. In the case of Ms Sandra Mahon who performed such services for the appellant, a deciding officer, an appeals officer and the chief appeals officer in the department of the respondent were of the opinion that she was employed under a contract of service and hence was an insurable person. That conclusion was upheld on appeal to the High Court by Carroll J in a judgment delivered on the 18th October, 1995. From that decision, the appellant has appealed to this Court.

The relevant legislation can be shortly summarised. Under s. 5(1)(a) of the Social Welfare (Consolidation) Act, 1981, (the Act in force at the time that the question arose in relation to Ms Mahon), every person over the age of 16 years and under pensionable age is "an insured person" for the purposes of the legislation if he or she is employed in any of the employments specified in Part I of the First Schedule. Paragraph 1 of Part I, refers to:-

"Employment in the State under any contract of service or apprenticeship, written or oral, whether expressed or implied, and whether the employed person is paid by the employer or some other person, and whether under one or more employers, and whether paid by time or by the piece or partly by time and partly by the piece, or otherwise, or without any money payment."

Under s. 111(1), every question arising inter alia as to whether the employment is or was insurable employment is to be decided by a deciding officer of the respondent. Section 298(1) provides that, if any person is dissatisfied with that decision, the question is to be referred to an appeals officer. Section 300(4) provides that:-

"The Chief Appeals Officer may, at any time and from time to time, revise any decision of an appeals officer, if it appears to him that the decision was erroneous by reason of some mistake having been made in relation to the law or the facts, and, . . . any person who is dissatisfied with the revised decision may appeal therefrom to the High Court on any question of law."

The facts - which were not at any stage materially in dispute - should now be set out.

Ms Mahon contacted the appellant by telephone in or about 1988, with a view to providing her services as a demonstrator and, having been interviewed, was placed on the panel from whom demonstrators are selected by the appellant. She was engaged on the terms of a written contract. The contract expired at the end of each year and a fresh contract was then entered into annually between her and the appellant. The appellant has approximately 70 demonstrators on its panel.

The manner in which Ms Mahon's services were availed of by the appellant was as follows. The particular retail store which required one of the appellant's food products to be demonstrated got in touch with the local customer service manager of the appellant and asked for such a demonstration specifying the day or days upon which it was required. Three or four days before the date of the proposed demonstration, the manager would telephone a demonstrator on the panel to inquire whether or not the demonstrator was available to provide her services on the particular days at the specified shop. Generally speaking, neither the demonstrator nor the appellant knew prior to this time whether or not a demonstration was to be given at any particular shop or store during the immediately following weekend. If the demonstrator was available, it was agreed that the service should be provided. The demonstration was carried out without any supervision by the appellant.

Ms. Mahon submitted an invoice in respect of the services provided after each demonstration to the appellant. The invoices were not treated as valid unless they were signed by the manager of the particular store in which the demonstration was carried out. Her fees were discharged on a fortnightly basis on production of the completed invoices. She was paid approximately L28.32 per day for her services and was also paid travelling expenses at the rate of 27p per mile. She was not a member of any pension scheme of the appellant nor was she a member of a trade union.

New contracts were entered into by the appellant with Ms Mahon in respect of each of the years ending the 31st December, 1991, the 31st December, 1992, and the 31st December, 1993. While there were some differences, the contracts for each of the years in question were in broadly the same terms. That in force for the year ending the 31st December, 1993, contained a number of important provisions which must be set out in full.

The letter from Ms Bernie Campbell, the customer services manager, confirming the retention of Ms Mahon and enclosing the terms and conditions of her employment, began as follows:-

"This is to confirm that [the appellant] is willing to retain your services as a demonstrator/merchandiser commencing on the 1st January, 1993 and ending on the 31st December, 1993.

For the avoidance of all doubt, I am obliged to point out to you that you will not be an employee of [the appellant], you will be providing it with your services as an independent contractor as and when they are required during the term of the contract.

The contract shall be subject to the standard terms and conditions, a copy of which is attached thereto . . ."

Attached to this letter were what were described as "NOTES" which stated as follows:-

"(1) You will be responsible for your own tax affairs. [The appellant] will be making returns to the revenue of all payments made to you. These payments will be made gross.
 
(2) You will not be an employee of [the appellant], you will be an independent contractor. This has implications in the area of employment legislation and from the point of view of injury or health and damages sustained or caused while you are providing services under the general terms and conditions to [the appellant]."

Clauses 2 to 9 inclusive were as follows:-

"(2) Retention of services

[The appellant] may, at its absolute and sole discretion and on such occasions as it thinks fit, retain the services of the demonstrator for the purposes of demonstrating and/or promoting and/or merchandising the product at such venues within the area as [the appellant] may from time to time require. [The appellant] shall give the demonstrator not less than 24 hours notice of the retention of his/her services hereunder. In the event of the demonstrator being unable for any reason to provide a service hereunder when requested so to do, the demonstrator shall at the earliest opportunity so inform [the appellant]. The demonstrator shall in such an event arrange for the service to be provided by a third party or by a servant or agent of the demonstrator PROVIDED ALWAYS that any such third party, servant or agent shall first have been approved by [the appellant] and shall agree to perform the service on terms and conditions which are these terms and conditions.
 
(3) The performance of functions

The demonstrator shall use his/her best endeavours to promote and/or demonstrate and/or merchandise the product to the best advantage of [the appellant] and shall at all times, while performing his/her functions hereunder, act in the best interest of [the appellant]. The demonstrator shall at all times be courteous towards customers or potential customers of [the appellant].
 
(4) Proper dress

The demonstrator shall present himself/herself in a neat, clean and tidy manner, properly attired and shall wear such uniform, jackets, coats and/or head-dress as [the appellant] may from time to time require and shall at all times present himself/herself in a manner that befits a demonstrator/merchandiser/promoter of food products.
 
(5) Punctuality

The demonstrator shall punctually attend at the time(s) stipulated by [the appellant] at the location where the demonstration, promotion or merchandising of the product is to take place.
 
(6) Abide by regulations

The demonstrator shall abide by such directions and regulations as may be in force at the place where the demonstration / promotion / merchandising is to take place. In the event of the demonstrator considering that any such directions or regulations are so restrictive that they effectively prevent or severely inhibit the performance of the demonstrator's functions hereunder, the demonstrator shall at the earliest opportunity inform the sales manager for the time being of [the appellant]whose decision on the matter shall be final and binding.
 
(7) Misconduct

Without prejudice to the terms of clause 16 hereof, if the demonstrator shall be guilty of any serious misconduct or neglect of his/her obligations under these terms and conditions [the appellant] may forthwith terminate the particular contract under which the services of the demonstrator are retained without prejudice to any other remedy which [the appellant] may have in such an event against the demonstrator.
 
(8) Independent contractor

The demonstrator is and shall be deemed to be an independent contractor and nothing in this agreement shall be construed as creating the relationship of master and servant or principal and agent. It is further agreed that the provisions the of the Unfair Dismissals Act, 1977, shall not apply to the contractual relationship that exists between [the appellant] and the demonstrator.
 
(9) Property of [the appellant]

All uniforms, coats, overalls, head-wear and utensils given to the demonstrator by [the appellant] shall at all times remain the sole property of [the appellant] and the demonstrators shall take all reasonable care of and shall not assign or part with the possession of any such uniforms, coats, overalls, head-wear and utensils."

Clause 11, which provided for the payment of the fees in the manner already described, also made it clear that it was the duty of the demonstrator to pay and discharge such taxes and charges as might be payable out of such fees.

Clause 12, under the heading "Indemnity", provided that the demonstrator was to exercise due skill and care and was to indemnify the appellant against claims for loss and damage sustained as a result of any act or omission of the demonstrator. It also made clear that the lifting and moving of goods, etc., in connection with the performance of the contract were to be done at the demonstrator's sole risk, but that nothing in the contract was to be construed as obliging the demonstrator to perform a task which was dangerous or to do anything in an unsafe manner.

Clause 13, under the heading "Not to work for Competitors", provided that:-

"The demonstrator shall not, for so long as he/she is making his/her services available to [the appellant] as a demonstrator and/or merchandiser and/or promoter, act as demonstrator, merchandiser or promoter in the area of any product which would be in competition with the product of [the appellant]."

Clause 16, under the heading "Separate Contract," provided that:-

"Each separate retention of the demonstrator's services by [the appellant] shall, unless otherwise agreed between [the appellant] and the demonstrator, be a separate and distinct contract to which each of these terms and conditions shall apply."

Ms Mahon carried out approximately 50 demonstrations in the course of a year. She was not supervised in any way by the appellant in carrying out the demonstrations, although she was expected, as clause 7 made clear, to comply with any reasonable directions given by the owner of the shop or store in which she was carrying out the demonstration. Moreover, while there was no continuous and direct supervision, a circular letter from Ms Campbell dated the 17th February, 1993, to all the demonstrators gave detailed instructions to them as to how they should do their job. This letter also made it clear that, in the event of a demonstrator finding on arrival at a store that the particular demonstration had been cancelled, he or she was entitled to ask if they could demonstrate another product. If there was no work available for them, the appellant paid no more than the mileage rate.

On the 11th May, 1992, the deciding officer decided that Ms Mahon was an insurable person. An appeal having been lodged, an oral hearing took place before the appeals officer at which evidence was given by Ms Mahon and Mr Liam Kerins, an accountant employed by the appellant. The appeals officer made his findings in the form of a written report dated the 30th April, 1993.

During the course of the hearing, the appellant had indicated that it was relying in part on a decision of the Circuit Court on an appeal from a determination by the Employment Appeals Tribunal in the case of a Mr Robert Cronin that his status was that of an independent contractor and not of an employee. The appeals officer indicated that he did not consider himself bound by this decision, although he did refer to other decisions of the High Court and of this Court and also to certain English authorities.

He was also referred to a decision by a local Inspector of Taxes that demonstrators such as Ms Wilson were self-employed persons and not within the scope of the P.A.Y.E. system. However, he said that he was aware that the Revenue had generally deemed employments of this nature to be under a contract of service and subject to P.A.Y.E. and was of the view that the stance adopted by the Inspector was "merely a holding arrangement".

The appeals officer also referred to a questionnaire from the department which had been completed by the appellant and in which it was apparently accepted by the appellant that it had the right to direct and control the demonstrator as to how, when and where he/she did the work.

As to the written contract, the appeals officer said:-

"Considerable reliance has been placed on the actual contract of employment, which is signed by Ms Mahon annually. However, as Ms Mahon mentioned at the hearing, she wants the work and thus has very little real option but to sign same."

Having referred to some of the authorities, he added:-

"Thus in the present case, I am required to consider the facts and the realities of the situation on the ground irrespective of what the actual contract states or specifies."

He then expressed his conclusion as follows:

"The facts are that Ms Mahon was recruited by the appellant. Has worked for the company for a number of years. Works 27/28 hours per week for 48 to 50 weeks of the year. Is paid a basic rate of L85 together with travelling expenses. Must do the work herself and supplies labour only. Cannot engage other people to stand in for her except in exceptional circumstances and then only with the approval of the company. She is supplied with materials to carry out her work. It appears to me that she cannot but be regarded as being subject to control and direction of the company.

All these factors when considering the above-mentioned test indicate that the only reasonable conclusion that I can come to is that the ingredients for a contract of service exist in this case and I so decide."

On the 22nd September, 1993, an application was made on behalf of the appellant to the Chief Appeals Officer to revise this decision. On the 11th October, 1993, the appellant was informed that the Chief Appeals Officer was of the view that the appeals officer had properly addressed himself to the issues arising from the deciding officer's decision and that the appeal decision was not erroneous by reason of some mistake having been made in relation to the law or the facts.

These proceedings were then instituted by way of an appeal pursuant to s. 300(4) of the Act of 1981 from the decision of the Chief Appeals Officer. (In the special summons, the appeal was also stated to be brought pursuant to s. 299, but it was accepted at the hearing that the appropriate form of appeal was under section 300(4).)

In her judgment, the learned High Court Judge (Unreported, High Court, Carroll J, 18th October, 1995), having pointed out that the appeal was on a question of law only, observed:-

"In an appeal on a question of law the court does not go into the merits of the decision. The primary facts are not in issue. Where there is a question of conclusions and inferences to be drawn from facts (a mixed question of fact and law) the court should confine itself to considering if they are conclusions and inferences which no reasonable person could draw or whether they are based on a wrong view of the law.

In this case that means that the court must consider (1) whether there was evidence to support the finding of fact that Sandra Mahon was employed on a contract of service and (2) did the appeals officer apply the law correctly. It is not for the court to start weighing the various factors."

Having also said that the fact that the contract was stated to be a contract for services was not a decisive factor and that "the entire contract" had to be considered in order to decide whether it was indeed a contract for services, the learned High Court Judge said that she was satisfied that the approach of the appeals officer was correct in law. She was also satisfied that he was correct as a matter of law in holding that he was not bound by the decision of the Circuit Court in the case of Cronin. Having said that the appellant had pointed to facts which supported the view that the contract was a contract for services and that the respondent had relied on facts which pointed to a contrary conclusion, she expressed her own conclusion as follows:-

"The decision reached depends on the importance which the appeals officer attached to some facts. This was a balancing operation which is essentially a matter of degree and his conclusions should not be disturbed unless they are such that no reasonable person could draw them.

In my opinion the appellant has not shown that the conclusions drawn by the appeals officer are ones which no reasonable person could draw and neither have they shown that they were based on a mistaken view of the law.

In those circumstances, the appeal should be dismissed."

On behalf of the appellant, counsel submitted first that the learned High Court Judge was wrong in point of law in the approach she had adopted to the appeal. He said that, in particular, she had failed to distinguish between the power of the High Court to set aside inferences of facts where those inferences are based on documents, such as the written contract in the present case, and its powers in regard to other inferences of fact. He further submitted that, in general, she had applied the wrong test in holding that she should only interfere with the findings of the appeals officer if they were findings of fact which no reasonable person could have reached on the evidence. He said that where, as here, the question before the appeal's officer was not one of fact, but a mixed question of fact and law, the learned High Court Judge should not have adopted so circumscribed an approach. He cited in support the decision of this Court in Mara (Inspector of Taxes) v Hummingbird Ltd. [1982] 2 ILRM 421 and the High Court decisions in o Coindealbhain (Insp. of Taxes) v Mooney [1990] 1 IR 422 and McAulliffe v Minister for Social Welfare [1995] 2 IR 238.

Counsel secondly submitted that, even if the jurisdiction of the High Court was as stated by the learned High Court Judge, the decision of the appeals officer should nonetheless have been set aside as being incorrect in point of law. He said that it was clear from his report that the appeals officer had wholly failed to have regard to the terms of the written contract between Ms Mahon and the appellant, contrary to the principles of law enunciated in the authorities. He said that the appeals officer had effectively ignored the contract on the ground that if Ms Mahon wanted the work she had to agree to that contract. Counsel said that, while it was accepted that clause 8 of the contract, providing that the demonstrator was to be deemed to be an independent contractor, was not determinative of the issue, it was of importance when viewed in the context of other terms of the contract. He relied particularly on those clauses of the contract which made it clear that the appellant was not obliged to retain the demonstrator's services and that the demonstrator was not obliged in turn to provide the services when requested, which imposed on the demonstrator the duty to discharge any taxes and which required the demonstrator to indemnify the appellant against any claims against it. He submitted that these clauses were not usually found in a contract of employment.

Counsel also relied on the fact that there was no supervision of the demonstrator's work and that, on the contrary, she had to comply with the directions and regulations of the particular store or shop which had requested the demonstration, which would obviously vary from one company to another.

Counsel submitted that, in addition, the appeals officer was wrong in law in wholly disregarding the decision of the Circuit Court, even though he was not bound by it. He had also placed too much reliance on the Form IWSI signed by the appellant, the form of which, requiring as it did "YES" or "NO" answers, made it difficult for the appellant accurately to describe the nature of Ms Mahon's employment.

On behalf of the respondent, counsel submitted that the jurisdiction of the High Court was limited under s. 300(4) of the Act 1981 to questions of law. Accordingly, unless the appeals officer had made a mistake of law or reached a conclusion which was not open to him on the evidence, his decision could not be set aside by the High Court. Counsel urged that it was clear from the appeals officer's report that he was aware of, and had applied, the relevant principles of law. Since his conclusions were reasonable, capable of being supported by the evidence and reached in accordance with the relevant legal principles, there was no ground on which they could be interfered with by the High Court.

Counsel for the respondent submitted that the legal principles applicable in determining whether a particular contract was one "of service" or "for services" had been identified in a number of Irish decisions such as o Coindealbhain (Insp. of Taxes) v Mooney [1990] 1 IR 422 which made it clear that the critical question was whether the person concerned was performing the relevant services as a person in business on his or her own account: if he or she was not, then the contract was clearly one of service. He submitted that the facts in the present case were closely analogous to those in the English decision of Market Investigations v Min. of Soc. Security [1969] 2 Q.B. 173, where it had been held that a person employed by a company engaged in market research as an interviewer was employed under a contract of service within the meaning of the corresponding English legislation. He submitted that the appeals officer in the present case was correct in law in adopting a similar approach to the employment of Ms Mahon.

Counsel further submitted that the appeals officer was correct in point of law in declining to follow the unreported decision of the Circuit Court in Cronin which had been reached on the basis of different facts and under different statutory provisions. The appeals officer was also correct in taking the view, that, while he should have regard to the decision in question, he was not bound to follow it and should take as the relevant binding precedents decisions of the High Court and the Supreme Court.

The first question that arises for consideration on this appeal is as to whether the High Court Judge was correct in holding that the only matters to be determined by her were whether there was evidence to support the finding of fact by the appeals officer that Ms Mahon was employed under a contract of service and whether the appeals officer had applied the correct legal principles.

In Mara (Inspector of Taxes) v Hummingbird Ltd. [1982] 2 ILRM 421, Kenny J, speaking for this Court, said at p. 426 in reference to findings of fact in a case stated by an appeals commissioner under the Income Tax Act, 1967:-

"A case stated consists in part of findings on questions of primary fact . . . These findings on primary facts should not be set aside by the courts unless there was no evidence whatever to support them. The commissioner then goes on in the case stated to give his conclusions or inferences from these primary facts. These are mixed questions of fact and law and the court should approach these in a different way. If they are based on the interpretation of documents, the court should reverse them if they are incorrect for it is in as good a position to determine the meaning of documents as is the commissioner. If the conclusions from the primary facts are ones which no reasonable commissioner could draw, the court should set aside his findings on the ground that he must be assumed to have misdirected himself as to the law or made a mistake in reasoning. Finally, if his conclusions show that he has adopted a wrong view of the law, they should be set aside. If however they are not based on a mistaken view of the law or a wrong interpretation of documents, they should not be set aside unless the inferences which he made from the primary facts were ones that no reasonable commissioner could draw."

In the present case, both the appeals officer and the learned High Court Judge were of the view that the fact that Ms Mahon was described in the written agreement as being employed as an "independent contractor" was not conclusive. It is accepted that they were correct in so holding. It is correct to say that the appeals officer appears to have taken the view that the importance of the terms of the written contract was somewhat diminished by the fact that Ms Mahon wanted the job and accordingly had no option but to sign the contract. However, it is also clear from his report that he considered in some detail the actual terms of the written contract and also had regard to the manner in which the work was done by Ms Mahon.

If the appeals officer had erred in law in his construction of the written contract, then, in accordance with the principles explained by Kenny J, his decision would be liable to be set aside by the High Court. In the present case, however, it has not been shown that the appeals officer in any way misconstrued the written contract: he was, on the contrary, entirely correct in holding that he should not confine his consideration to what was contained in the written contract, but should have regard to all the circumstances of Ms Mahon's employment. Equally, the High Court Judge was correct in the view she took that she should not interfere with his findings in this regard unless they were incapable of being supported by the facts or were based on an erroneous view of the law.

The second question that arises on this appeal is as to whether the conclusions reached by the appeals officer in his report were in fact based on an erroneous view of the law. The criteria which should be adopted in considering whether a particular employment, in the context of legislation such as the Act of 1981, is to be regarded as a contract "for service" or a contract "of services" have been the subject of a number of decisions in Ireland and England. In some of the cases, different terminology is used and the distinction is stated as being between a "servant" and "independent contractor". However, there is a consensus to be found in the authorities that each case must be considered in the light of its particular facts and of the general principles which the courts have developed: see the observations of Barr J, in McAuliffe v Minister for Social Welfare [1995] 2 IR 238.

At one stage, the extent and degree of the control which was exercised by one party over the other in the performance of the work was regarded as decisive. However, as later authorities demonstrate, that test does not always provide satisfactory guidance. In Cassidy v Ministry of Health [1951] 2 K.B. 343, it was pointed out that, although the master of a ship is clearly employed under a contract of service, the owners are not entitled to tell him how he should navigate the vessel. Conversely, the fact that one party reserves the right to exercise full control over the method of doing the work may be consistent with the other party being an independent contractor: see Queensland Stations Property Ltd. v Federal Commissioner of Taxation [1945] 70 CLR. 539.

In the English decision of Market Investigations v Min. of Soc. Security [1969] 2 Q.B. 173, Cooke J, at p. 184 having referred to these authorities said:-

"The observations of Lord Wright, of Denning L. J and of the judges of the Supreme Court suggest that the fundamental test to be applied is this: 'Is the person who has engaged himself to perform these services performing them as a person in business on his own account '. If the answer to that question is 'yes', then the contract is a contract for services. If the answer is 'no', then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task."

It should also be noted that the Supreme Court of the Irish Free State in Graham v Minister for Industry and Commerce [1933] IR 156, had also made it clear that the essential test was whether the person alleged to be a "servant" was in fact working for himself or for another person.

It is, accordingly, clear that, while each case must be determined in the light of its particular facts and circumstances, in general a person will be regarded as providing his or her services under a contract of service and not as an independent contractor where he or she is performing those services for another person and not for himself or herself. The degree of control exercised over how the work is to be performed, although a factor to be taken into account, is not decisive. The inference that the person is engaged in business on his or her own account can be more readily drawn where he or she provides the necessary premises or equipment or some other form of investment, where he or she employs others to assist in the business and where the profit which he or she derives from the business is dependent on the efficiency with which it is conducted by him or her.

The question remains as to whether the appeals officer, in the light of the legal principles to which I have referred, was entitled to arrive at the conclusion he did on the facts as found by him. I have no doubt that he was. Obviously, having regard to the nature of the work for which she was employed, there was no continuous supervision of Ms Mahon by the appellant. That cannot be regarded as a decisive factor, any more than it was in the case of the market researcher, the nature of whose employment was in issue in the case decided by Cooke J On the other side of the equation are the facts that Ms Mahon was provided by the appellant with the clothing and equipment necessary for the demonstration and made no contribution, financial or otherwise, of her own and that the remuneration she earned was solely dependent on her providing the demonstrations at the times and in the places nominated by the appellant. The amount of money she earned was determined exclusively by the extent to which her services were availed of by the appellant: she was not in a position by better management and employment of resources to ensure for herself a higher profit from her activities. She did not as a matter of routine engage other people to assist her in the work: where she was unable to do the work herself, she had to arrange for it to be done by someone else, but the person in question had to be approved by the appellant.

The written agreement was undoubtedly drafted with understandable care with a view to ensuring, so far as possible, that Ms Mahon was regarded in law as an independent contractor. However, as I have already pointed out, although this was a factor to which the appeals officer was bound to have regard, it was by no means decisive of the issue. When he took into account all the circumstances of her employment, he was perfectly entitled to arrive at the conclusion, as he did, that she was employed under a contract of service.

As to the submission that the appeals officer should have treated himself as bound by the unreported decision of the Circuit Court in Cronin, it is sufficient to say that, since it was a decision on different facts in another statutory context and no written judgment appears to have been available, the appeals officer was entitled to adopt the approach he did, ie of applying to the facts as found by him the legal principles laid down in decisions of the High Court and this Court. This he clearly did and, for the reasons I have already given, I am satisfied that the High Court Judge was entirely correct in holding that his conclusions could not be disturbed.

I would dismiss the appeal.

Murphy J

I am in complete agreement with the judgment delivered by Keane J but I would like to add certain observations of my own partly in deference to the very able argument presented by counsel on behalf of the appellant and more particularly to provide such assistance as I can for the administrative tribunals charged with the duty of implementing the provisions of the Social Welfare Acts, 1993 to 1997.

The argument on which the appellant most confidently relied was that the appeals officer had erred in law in failing to have sufficient regard to the terms of the written contract between Ms Mahon and the appellant and that the learned judge of the High Court failed to correct that error. The appellant cited the principle accepted by Blayney J in o Coindealbhain (Insp. of Taxes) v Mooney [1990] 1 IR 422 at p. 424 in the following terms:-

"Where the agreement creating the relationship between the parties is expressed in writing, . . . the entire agreement between the parties is to be found in the writing, so it is the unique source of their relationship; it follows that it is from its terms alone that the nature of the relationship can be determined."

It is then said that this principle was ignored or misapplied by the appeals officer who in his written report dated the 30th April, 1993, stated as follows:-

"Considerable reliance has been placed on the actual contract of employment, which is signed by Ms Mahon annually. However, as Ms Mahon mentioned at the hearing, she wants the work and thus has very little option but to sign same."

The officer went on to say, as Keane J has already noted:-

"Thus in the present case, I am required to consider the facts and the realities of the situation on the ground irrespective of what the actual contract states or specifies."

The document known as the "Demonstrators' General Terms and Conditions", which was applicable to Ms Mahon and all other demonstrators whose names were from time to time included on the panel maintained by the appellant as persons available to provide the services of a demonstrator, is reasonably lengthy but not very informative. It is clear that the panellists might have been called upon "to demonstrate, promote, market and sell" the appellant's products at different locations but little guidance is forthcoming as to the manner in which those operations would be carried out or the skills which the panellists might possess or would be required to exercise in carrying out their functions. The document is silent as to who decides the precise form of any particular commercial activity involved. Has the demonstrator any role in deciding what form a demonstration should take Presumably important commercial issues could arise as to the amount of individual samples to be provided or the form or scope of any particular display. The general terms and conditions cast no light on these matters. The document, for the greater part, regulates matters of conduct which might be of equal application to an employee or to an independent contractor.

The terms and conditions expressly provide that the demonstrator is:-

"deemed to be an independent contractor and nothing in this agreement should be construed as creating the relationship of master and servant or principal and agents."

The same clause goes on expressly to provide that:-

"It is further agreed that the provisions of the Unfair Dismissals Act, 1977, shall not apply to the contractual relationship between [the appellant] and the demonstrator."

Again the express provisions included a term that:-

"It shall be the duty of the demonstrator to pay and discharge such taxes and charges as may be payable out of such fees to the revenue commissioners or otherwise."

On behalf of the appellant it was conceded that these provisions were not of decisive importance. In my view their value, if any, is marginal. These terms are included in the contract but they are not contractual terms in the sense of imposing obligations on one party in favour of the other. They purport to express a conclusion of law as to the consequences of the contract between the parties. Whether Ms Mahon was retained under a contract of service depends essentially on the totality of the contractual relationship express or implied between her and the appellant and not upon any statement as to the consequence of the bargain. Certainly the imposition of income tax and the manner of its collection falls to be determined in accordance with the appropriate legislation and the regulations made thereunder as they impinge upon the actual relationship between parties and not their statement as to how liability should arise or be discharged.

The terms and conditions governing the engagement of Ms Mahon were not "the unique source" of the relationship between her and the appellant. I am satisfied that the appeals officer was correct in his conclusion that he was required to consider "the facts or realities of the situation on the ground" to enable him to reach a decision on the vexed question whether the respondent was an employee or an independent contractor. In seeking to ascertain the true bargain between the parties rather than rely on the labels ascribed by them to their relationship the appeals officer was expressly and correctly following the judgment of Carroll J In In re Sunday Tribune Ltd. [1984] IR 505. Of course the appeals officer was not entitled to ignore the terms and conditions under which the demonstrator was engaged nor did he do so. His report analyses fully and fairly the relevant written conditions in the context of the oral evidence heard by and the arguments addressed to him. I have no doubt that the officer was entitled to reach the conclusion that he did and that the learned trial judge was correct in upholding that decision.

I would dismiss the appeal herein.


© 1997 Irish Supreme Court


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