Commissioner of Pay-roll Tax (Vic.) v. Mary Kay Cosmetics Pty. Ltd.

Judges: Young CJ
Lush J

Gray J

Supreme Court of Victoria (Full Court)

Judgment date: Judgment handed down 24 June 1982.

Gray J.

The respondent company was assessed for additional pay-roll tax amounting to $590,694.39 by three assessments under sec. 18(1) of the Pay-roll Tax Act 1971. The assessments covered a period from September 1971 to December 1979. An objection to the assessment made under Pt. VI of the Act was disallowed. The respondent then proceeded by way of an appeal to a single Judge of this Court. The three appeals were consolidated and heard by Tadgell J. On 20th November, 1981, his Honour allowed the appeals and set aside the assessments. The present appeal is brought by the Commissioner against those orders.

The respondent is a retailer of cosmetics and purchases its products from other companies who manufacture to its requirements. It does not sell through conventional retail outlets but direct to consumers by what is known as the party plan system. Under that system the respondent engages persons who are described as beauty consultants to solicit and obtain purchase orders for its products at functions which it calls beauty shows.

The question raised by this appeal is whether certain commissions paid by the respondent to the beauty consultants were ``wages'' within the meaning of the Act. If they were ``wages'', it is common ground that pay-roll tax is chargeable upon them under sec. 7 of the Act. The commissions were ``wages'' as defined by sec. 3(1) of the Act if, but only if, they were paid or payable to ``an employee as such'' in terms of that definition. They were paid by the respondent to an ``employee as such'' if paid to a person between whom and the respondent there existed a contract of service and if paid pursuant to that contract.

The evidence discloses that the relevant payments were made by the respondent under an agreement in writing with each payee who was described therein as ``an independent contractor and not an employee'' of the respondent. The appellant contended that that was a mis-description, having regard to all the relevant circumstances, and that each payee was in truth a servant of the respondent. The respondent contended that its relationship with each payee was correctly described in the agreement.

In a carefully reasoned judgment, Tadgell J. decided this question in favour of the respondent. The facts upon which his Honour founded his final conclusion were not called into any serious question on this appeal. The facts are set out very fully in his Honour's judgment and I will give a somewhat abbreviated version for the purposes of this judgment.

I have already referred to the party plan system which is the foundation of the respondent's selling scheme. Under this system, the respondent engages commission agents known as ``beauty consultants''. In a typical case, the beauty consultant arranges a beauty show at the house of a person called a hostess to whom she has previously made the products known. The hostess is encouraged by the consultant to invite other interested persons to attend the beauty show. At the show, the beauty consultant demonstrates the products and solicits orders for them on behalf of the respondent. The beauty consultant then compiles a master order on a form provided by the respondent and sends it to the respondent's office with a cheque or money order for the retail price of the goods ordered less the commission payable to her. The commission varies from thirty per cent to fifty per cent of the retail price, depending upon the value of the master order. The

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respondent then despatches the products ordered by the beauty consultant who then delivers them to the hostess upon payment of the full retail price which has been collected by the hostess from the various purchasers.

The beauty consultant subsequently services these purchasers with a view to replenishing the used products. The beauty consultant may carry a small quantity of stock out of which purchases by customers may be fulfilled, but such stock is paid for by the beauty consultant before she receives it, although the property in the stock remains in the respondent. It is in the interests of the beauty consultant to arrange as many beauty shows as possible with a view to generating sales and developing a pool of clients or customers. The beauty consultant encourages other guests at shows to arrange further shows at which she can give demonstrations. The beauty consultant can allow a hostess a discount on any future purchases. The beauty consultant is also encouraged to recruit other people to become beauty consultants and, if she succeeds, she receives a commission from two per cent to four per cent on the monthly sales made by these new beauty consultants. This commission is paid by the respondent monthly by cheque.

If the beauty consultant achieves a stipulated level of sales she can become a unit sales director and is placed at the head of a group of beauty consultants and becomes entitled to further commission on sales made by the unit. This commission varies from 4.5 to six per cent and is paid monthly by cheque by the respondent. A unit director does not enter into any fresh written engagement with the respondent.

The form of agency agreement underwent some changes during the relevant period, but the changes are not, in my opinion, material. One of the forms of agreement is set out in full in Tadgell J.'s judgment. The agreement under which the beauty consultants are engaged is called a Limited Agency Agreement. It recites that the consultant is appointed as an independent agent to solicit and take orders for the respondent's products. The agreement is thereafter divided into two parts, Part A being the undertakings of the respondent, and Part B being those of the consultant. It is necessary to recite all of Part A and some parts of Part B. Part A reads as follows:


1. That the Consultant may solicit purchase orders for the Company's products at the retail prices from time to time fixed by the Company.

2. If such orders are accepted by the Company and the purchase price is paid therefore [sic] the Company will allow to the Consultant the commissions from time to time specified by the Company in its Consultants' Manual.

3. The Company will also pay to the Consultant in respect of sales of the Company's products taken by other Consultants personally recruited by the Consultant the commissions from time to time specified by the Company in its Consultants' Manual.

4. That the Consultant may terminate this agreement at any time by written notice to the Company at its Head Office.

5. That there are no restrictions placed on the Consultant as to territory.''

Part B is concerned with the consultant's undertakings, and I refer to cl. 4, 6 and 8 of Part B. Clause 4 reads:

``4. That she is an independent contractor and not an employee of the Company and is not for any purpose to be regarded as such; that she is not and shall not hold herself out as being an agent of the Company for any purpose other than to solicit and take purchase orders for the Company's products at the afore-mentioned retail prices; that she will bear all costs and expenses incurred by her in connection with her activities hereunder; that she will indemnify and keep the Company indemnified against all actions, proceedings, liabilities, claims, damages, costs and expenses arising out of or in any way relating to the Consultant's activities hereunder, except such as relate to the inherent quality and fitness of the Company's products for which the Company agrees it is responsible.


6. That the Company may at its option by notice in writing posted to the

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Consultant at her address last known to the Company terminate this agreement for any action by the Consultant which, in the Company's opinion, is contrary to the Company's best interests.


8. That this document constitutes the entire agreement between the Company and the Consultant and that no representations or warranties have been made or given by the Company or any of its representatives to the Consultant other than those set forth in this agreement.''

Usually, the respondent does not interview an applicant before appointing her as a beauty consultant, but relies on the recommendation of an existing beauty consultant. In 1979 there were 1,287 beauty consultants operating throughout Australia, of whom 46 were sales directors. During the period covered by the assessments approximately twelve million dollars had been paid in commissions by the respondent. The annual turnover of beauty consultants caused by termination of agreements has been high and it is not uncommon for nine out of ten beauty consultants to be replaced within a year of appointment. A beauty consultant must place an order for products having a retail value of $200 every ninety days, and if this requirement is not met her agreement is terminated. A large number of consultants allow their engagements to peter out in this way. A beauty consultant is not expected to communicate with the respondent in any way except by forwarding the orders for the products. The respondent has only one establishment for the whole of Australia and that is situated in Victoria. Its actual staff number only twenty persons. A beauty consultant is encouraged to seek guidance from her unit sales director and to make a weekly report, and attend weekly meetings, but there is no obligation upon her to do so. In the result, some beauty consultants do, others do not. The only other regular contact is a general meeting, called a jamboree, held in each capital city once a year and an annual seminar held in Melbourne. These functions are partly social occasions and partly to enable beauty consultants to meet each other. Attendance at such functions is optional and prizes are given for sales and recruiting competitions.

The beauty consultants are not paid holiday pay, sick pay, or other benefits commonly associated with employee status. Income tax instalments have never been deducted from their earnings and the respondent has never included the beauty consultants' commissions in its pay-roll tax returns. However, the respondent did take out a workers' compensation insurance policy to cover any claims by the beauty consultants in their capacity as independent contractors. Beauty consultants personally pay all costs incurred by them in the course of their activities as beauty consultants. Most beauty consultants work only part time and there is no territorial restriction imposed upon them. They can act as selling agent for other products which do not compete with those of the respondent.

Upon appointment, each beauty consultant is provided with a manual in which very detailed suggestions are made as to the manner in which the beauty consultant should conduct her operations. The language of the manual proceeds upon the footing that the beauty consultant is about to embark upon her own business enterprise. The manual seeks to bestow upon the beauty consultant the benefit of the respondent's experience in the field and only in a few instances do the suggestions assume an imperative character. It is to be noted that the agency agreement does not, in terms, oblige the beauty consultant to comply with any provisions of the manual, in contrast to the covenants by the respondent company. The only provisions in the manual which are expressed in imperative terms are the fixing of commission rates and prohibitions against displaying the product at a retail outlet, advertising the product and using the respondent's trade mark. Most of the many other provisions of the manual are expressed as suggestions only. Furthermore, it could hardly be said of them that non-compliance would affect the respondent's interest and thus justify termination under cl. B.6 of the agreement.

I should mention one provision of the manual which is concerned with a practice known as ``dove-tailing''. If a beauty consultant has booked more than one beauty show at the same time she may provide a substitute beauty consultant to attend a show in her place. In such a case, the manual lays it

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down that the substitute should pay the first beauty consultant a commission of fifteen per cent of the sales achieved at the beauty show conducted by the substitute. In this regard the manual purports to regulate the arrangements, not between the respondent and the beauty consultants, but between the beauty consultants themselves.

Before Tadgell J. the case for the present appellant was that the agreement, even by itself, but especially when read in the light of the manual and the conduct of the parties, is essentially a contract of service. The present respondent's case was that neither the manual nor the oral evidence displaced the relationship between the parties as expressed in the written agreement, namely that of principal and independent contractor. The learned Judge, after a thorough review of the evidence, concluded that the beauty consultants, including the sales directors, enjoyed a degree of independence which was quite inconsistent with a contract of service. He further concluded that although the beauty consultants were vital to the respondent's business, they remained merely accessory to it.

His Honour recognized that, under the Act, the burden of proving that an assessment was unjustified lay upon the present respondent. Nevertheless, his Honour reached his conclusion in favour of the respondent ``without much hesitation''. Upon this appeal it was accepted by the parties that this Court should determine for itself what conclusion should be drawn from the evidence accepted by the learned Judge, rather than consider whether the learned Judge's conclusion was one which was reasonably open to him:
Warren v. Coombs (1978) 23 A.L.R. 405.

The notice of appeal contains no fewer than twenty-six grounds, and a number of sub-grounds. Mr. Merralls Q.C., who with Mr. Mealy appeared for the appellant, made no particular reference to the grounds of the notice of appeal, which all say, in one way or another, that the learned Judge was wrong in reaching the conclusion that he did. However, Mr. Merralls, in argument, attacked the judgment below upon the basis that the learned Judge attached insufficient significance to the manual which, it was said, led his Honour to overstate the degree of independence enjoyed by the beauty consultants.

Mr. Merralls put an alternative submission that, even if the Court did not regard the beauty consultants as employees, it should treat the unit directors as such. He submitted that the learned Judge was in error in drawing no relevant distinction between the two classes. He invited the Court to treat the payments made to unit directors as taxable, even if his primary submission failed.

In relation to his primary submission, Mr. Merralls took the Court through various provisions in the manual and other passages in the evidence which, he submitted, indicated the high degree of control exercised by the respondent over the activities of the beauty consultants. Mr. Merralls contended that the evidence shows that the respondent conducts a systematic business with rigid rules of conduct for its officers, who themselves enjoy different levels of seniority. He drew attention to the fact that the respondent does not advertise its products or sell at retail outlets, and retains property in the product until it passes to the consumer, even in the case of stock held by the beauty consultants.

As to the written agreement, Mr. Merralls submitted that although cl. B.8 provides that the entire agreement between the parties is constituted by the document, this is not the case, because cl. A.1, A.2, and A.3 incorporate the manual into the agreement. Mr. Merralls submitted that cl. B.6 entitles the respondent to terminate the agreement if the beauty consultant acts in a way which, in the respondent's opinion, is contrary to its interests. He put it that cl. B.6 should be regarded as a means of enforcing compliance with the provisions of the manual, which itself is a systematic and comprehensive code for the sale of the respondent's products. Mr. Merralls put it that the manual provides for a web of command with appropriate machinery for recruitment of beauty consultants and advancement by existing beauty consultants to senior levels. He pointed to the provisions in the manual dealing with the consultants' remuneration, the part played by the unit directors and the many provisions which prescribe in detail how the selling procedures should be conducted. He submitted that although most

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of the provisions were expressed as recommendations, it appeared from the evidence that the beauty consultants who were called as witnesses complied strictly with the manual's more important provisions. He put it that the evidence showed that the respondent's prohibition on advertising or selling at retail outlets has been strictly complied with. He referred to the evidence of Mr. Watt, the respondent's managing director, who spoke of terminating the engagement of one beauty consultant who engaged in selling the respondent's products at a milk bar. Mr. Merralls submitted that the right to terminate an engagement for such a departure from the respondent's requirements indicated that the provisions in the manual should be regarded as mandatory rather than merely suggestive. Mr. Merralls referred to the provisions of the manual concerned with the dove-tailing procedure when a double booking occurs, the keeping of records, reports to unit directors, credits to hostesses and other matters which he submitted reinforced the impression of a well-organised operation whose officers are, in truth, tightly controlled by the respondent. He submitted that the inescapable inference is that any significant departure by a beauty consultant from the directions contained in the manual would or could be visited by termination. He put it that the evidence indicates that beauty consultants either drop out at an early stage or toe the line laid down in the manual, including the price-fixing directions.

Mr. Merralls submitted that the modern authorities, to some of which he referred, are more ready to treat as employees persons who work flexible hours, are not supervised, use their own transport, pay expenses out of remuneration, and the like. He submitted that because of the high degree of de facto control exercised by the respondent over the beauty consultants, the learned Judge allowed inadequate weight to this factor in a way which led him into error.

In support of his alternative submission, Mr. Merralls suggested that the unit directors clearly carry out duties in the course of a contract of service with the respondent. He pointed to the fact that unit directors carry out supervisory activities, consider fresh applications by potential beauty consultants, hold meetings of beauty consultants and give advice to them and receive a direct payment from the respondent over and above their ordinary commissions. Mr. Merralls put it that for all those reasons it should be inferred that the true relationship between the respondent and a unit director was that of master and servant.

Mr. Liddell Q.C., who appeared with Mr. Garde for the respondent, submitted that the beauty consultants and unit directors were independent contractors. He submitted that the conduct of the parties and the surrounding circumstances pointed to this conclusion and that any doubt as to their status is cleared up by cl. B.4 of the agency agreement. He submitted that there is no reason to regard the agreement as a sham, and accordingly, it provides the best indication of the true status of the beauty consultants. Mr. Liddell put it that, in any event, the external indications do nothing to weaken the impact of the agreement. He submitted that the circumstantial case in favour of an independent agency is far stronger here than was the case which found favour with the Privy Council in
Australian Mutual Provident Society v. Allan and Anor. (1978) 52 A.L.J.R. 407, although the circumstances were broadly similar. Mr. Liddell pointed to the testimony of the five beauty consultants who gave evidence, and submitted that it showed that each was carrying on her own selling business in an individual way and was complying with the manual as much or as little as she pleased. He also submitted that it was clear that the respondent was not concerned whether unit directors held meetings, or, if so, who attended them.

As to the manual, Mr. Liddell submitted that apart from advice and exhortation, the requirements of the manual are confined to requirements necessary to give effect to the agreement, requirements imposed by the law and requirements dictated by commonsense. In the first category he instanced the fixing of commission, including the dove-tailing arrangements; in the second he instanced the prohibition on using the respondent's trade-mark, and, in the third, he instanced the commonsense directions as to dress and deportment. He submitted that none of the provisions in the manual are inconsistent with the arrangement of a limited agency.

ATC 4451

As to the respondent's alternative submission, Mr. Liddell complained that it was not raised in the Court below. But further, he submitted that the unit directors are in no way distinguishable from the ordinary beauty consultants, except that their greater scale of operations has earned them additional commission. He submitted that a unit director's relationship with the respondent remains that of independent selling agent.

As with most cases in this area of the law, there is a good deal which can be said on each side of the argument. A Court is usually faced with a large collection of relevant facts and circumstances, some pointing this way and some the other. The resolution of the problem usually comes down to a very subjective matter of individual impression. It all depends upon where the emphasis is laid.

In cases of this sort, the Court is usually referred to a number of decided cases dealing with facts similar to but not identical with the subject case. This appeal was no exception, although counsel showed commendable restraint and selectivity in this regard.

Courts have over the years endeavoured to lay down principles which may be capable of general application. Because of the infinite variety of relationships in commercial situations, it is rare to find a case which can be easily resolved by the application of a principle to the established facts.

The one principle which is clearly established is that the degree of control exercised by one person over another is always a relevant consideration in determining whether a contract of service exists between them. Although the sole test of control has proved inadequate in some classes of case, e.g.
Zuijs v. Wirth Bros. Pty. Ltd. (1955) 93 C.L.R. 561, it has always been accepted as a factor, in some degree, in all cases where the present question arises.

Recent years have seen the emergence of the ``integration test'', where the question whether a person is an employee is measured by reference to the extent that his activities form an integral part of his master's business operation. See
Bailey v. Victorian Soccer Federation (1976) V.R. 13, per Gillard J. at pp. 33-34 and the cases there referred to.

The limitations of this test were referred to by Stephen J. in
F.C. of T. v. Barrett and Ors. 73 ATC 4147 at p. 4150; (1973) 129 C.L.R. 395 at p. 402, and in my opinion it is not a helpful test in a case such as the present. In one sense, the beauty consultants are an integral part of the respondent's organisation because it is entirely reliant upon them to sell its product. In another sense, the beauty consultants, being part-time workers who can work as much or as little as they please, are anything but an integral part of the respondent's undertaking. The integration test may be useful in forming a judgment about a person said to be an employee of, say, a public hospital or like institution. But, in my opinion, it throws no light on the present problem.

When Allan's case (supra) was before the Supreme Court of South Australia,
R. v. Allan; Ex parte Australian Mutual Provident Society (1977) 16 S.A.S.R. 237, Bray C.J., after stating that the test of control was no longer decisive, said (at p. 247):

``It seems to me, then, that at the present time there is no magic touchstone. The Court has to look at a number of indicia and then make up its mind into which category the instant case should be put. It is a question of balancing the indicia pro and con... But the power of control over the manner of doing the work is very important, perhaps the most important of such indicia.''

Those views were adopted by the Judicial Committee when the case went on appeal, and were adopted by the learned trial Judge in this case. I would respectfully agree that the test stated is one which is appropriate to this case.

The arguments presented to this Court implicitly recognized that the element of control was the most important of the indicia which had to be considered and each counsel strove to maximise or minimise this factor.

The learned Judge's decision rested upon his conclusion that, in this case, the beauty consultants were subjected to very little control in the relevant sense. He also referred to other indications which, in his opinion, supported the conclusion which he reached. His Honour fully considered the factors which pointed towards a contract of service,

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but found them to be found wanting in the balance.

The matters which weighed with his Honour as telling against a contract of service were largely those relied upon by counsel for the respondent in argument, to which I have already referred.

In relation to the primary issue, I consider that the learned Judge was correct in his conclusion that the circumstances of this transaction do not provide any impulse to look behind the status assigned to a beauty consultant in the agency agreement. Although I have so far resisted the temptation to compare the facts of this case with the facts of other decided cases, I feel persuaded that, had the facts of this case been before the Privy Council at the time of Allan's case, the result would have been in the present respondent's favour. Furthermore, Allan's case is very clear authority for the view that, in a case like the present, the agreement is the best evidence of the relationship between the parties. In Allan's case, cl. 3 of the Society's agreement with its representatives provided that, ``The relationship between the Society and yourself is that of Principal and Agent and not that of Master and Servant''. At p. 409 the judgment of their Lordships proceeds:

``Clearly cl. 3, which, if it stood alone, would be conclusive in favour of the Society, cannot receive effect according to its terms if they contradict the effect of the agreement as a whole. Nevertheless, their Lordships attach importance to cl. 3, and they consider that the following statement by Lord Denning M.R. in
Massey v. Crown Life Insurance Co. (4th November, 1977, unreported) correctly states the way in which it can properly be used:

  • `The law, as I see it, is this: if the true relationship of the parties is that of master and servant under a contract of service, the parties cannot alter the truth of that relationship by putting a different label upon it... On the other hand, if their relationship is ambiguous and is capable of being one or the other [that is, either service or agency], then the parties can remove that ambiguity, by the very agreement itself which they make with one another. The agreement itself then becomes the best material from which to gather the true legal relationship between them.'''

Their Lordships continued:

``In the present case, where there is no reason to think that the clause is a sham, or that it is not a genuine statement of the parties' intentions, it must be given its proper weight in relation to other clauses in the agreement.''

In this case, it has not been suggested that the agreement is a sham and, in my opinion, the observations of their Lordships carry considerable weight in the present context.

Looking at the circumstances apart from the agreement, one receives an impression of an army of beauty consultants in action selling the respondent's product more or less in conformity with the respondent's manual. Some put many hours per week into the enterprise and some may achieve a level of activity which leads to their becoming a unit director. Others may devote very little time to selling activities or may drop out altogether. Some may attend weekly meetings and others may not. The same is true of furnishing weekly reports. The overriding impression is that no beauty consultant is compelled to do anything, except in certain negative respects. Nor is she controlled in any real sense at all. The only spur which may keep her active is self-interest, but the level of her activity remains entirely a matter for her.

In my opinion, the same is true of unit directors. By reason of having reached that level, a unit director is likely to be very active. But she does not appear to be under any obligation to the respondent to remain active. She can let her level of activity fall off, when she will presumably re-enter the ranks of the ordinary beauty consultants. The proper classification of the status of a unit director is that the achieving of that status represents expansion of the business of a consultant. A subsequent shrinkage of business will doubtless produce a reversion to her former status. The supervisory activities of a unit director, the arranging of meetings, the receipt of reports and the possible vetting of applications, do not appear to be activities which are required by the respondent. Once again, they seem to be activities which are

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likely to be prompted by the unit director's self-interest in generating sales activity.

So far as the provisions of the manual are said to evidence a degree of control, I cannot accept that any significant control over the beauty consultants is achieved by this means. The agreement does not require a beauty consultant to comply with the manual's directions. Most of the imperative utterances of the manual merely state the requirements of the general law or the requirements of the formal contract. The prohibition of the use of the trade-mark is an example of the former, and the prohibition on retail selling an example of the latter. For the rest, even if the requirements of the manual are expressed imperatively, they are clearly in the nature of advice. Very few of the provisions of the manual are such that its breach would affect the interests of the respondent and thus justify a termination. In short, the manual carries no teeth so far as a beauty consultant is concerned, except in the instances where compliance is required on other grounds.

The provisions regarding dove-tailing are something of an anomaly. They do purport to affect the relationship between beauty consultants themselves. I imagine that, as Mr. Watt suggested in evidence, the provision was inserted to avoid unseemly squabbles between beauty consultants as to their share of commission. In any event, there seems to be no impediment to the beauty consultants agreeing to share the commission on some basis different from that stipulated. If that were done, it would hardly be a matter of concern to the respondent.

On the whole, I cannot accept that any significant measure of control is provided by the manual. This case is, in my opinion, very different from the case of the Weight Watchers operation, which was the subject of consideration in
Narich Pty. Ltd. v. Commr. of Pay-roll Tax (N.S.W.) 82 ATC 4359, the report of which was not available when Tadgell J. gave judgment. That case concerned the same question as that raised in this appeal. The organisation which was charged with pay-roll tax was the Australian franchiser of Weight Watchers. The company conducted its operations in a manner broadly similar to that followed by the respondent in this case. The equivalent of the beauty consultants were called ``lecturers'' and they conducted classes at which persons seeking to lose weight attended for reward. A ``Weight Watchers Lecturer's Handbook'' provided detailed instruction as to the manner in which the lectures should be conducted. Each lecturer was required to sign a written agreement, but that agreement is in a substantially different form from the agreement in this case. One important point of distinction is cl. 1(b) which reads:

``If the lecturer fails or refuses to carry out her duties or obligations as a lecturer in a proper manner or the weight of the lecturer exceeds her goal weight the company may terminate her engagement without notice.''

This power of termination for non-compliance was regarded by Woodward J. as a weighty factor in reaching the conclusion that the ``lecturers'' were employees: see p. 508. In my opinion, this and other distinguishing features make this case unhelpful for present purposes.

Mr. Merralls also placed reliance upon the judgment of Stephen J. in Barrett's case (supra), but in my opinion there are striking differences between the position of the land agents in Barrett's case and the beauty consultants here. At ATC pp. 4152-4153; C.L.R. pp. 406-407 of the report Stephen J. collected a number of circumstances which pointed to the conclusion that the agents were employees. These included the facts that the agents were in the exclusive service of the employer firm, were required to report daily and to attend at the firm's office once weekly and attend other meetings with members of the firm. As these features, none of which are present here, were clearly relied upon by Stephen J., I do not regard Barrett's case as standing in the way of a conclusion favourable to the respondent in this appeal.

Accordingly, upon the whole of the evidence, I feel quite satisfied that the beauty consultants and the sales directors enjoyed a degree of independence from the respondent degree of independence from the respondent which is quite inconsistent with a contract of service. I consider that the learned Judge was correct in his conclusion that pay-roll tax is not chargeable upon payments made by the respondent either to beauty consultants or sales directors. I would dismiss the appeal.

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