Scottish Court of Session Decisions

The Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58) enacts, sec. 13 — “‘Workman’ … means any person who has entered into or works under a contract of service or apprenticeship with an employer, whether by way of manual labour, clerical work, or otherwise, and whether the contract is expressed or implied, is oral or in writing.…”

First Schedule (1)—“The amount of compensation under this Act shall be—( b) Where total or partial incapacity for work results from the injury, a weekly payment during the incapacity not exceeding fifty per cent. of his average weekly earnings during the previous twelve months … [or] … for any less period during which he has been in the employment of the same employer.” John MacGillivray, labourer, Inverness, having claimed compensation under the Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58) from the Northern Counties Institute for the Blind, Inverness, the matter was referred to the arbitration of the Sheriff-Substitute at Inverness ( Grant), who assoilized the defenders, and, at the request of the appellant, stated a case for i appeal.

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The following facts were proved—“The respondents are a charitable institution, whose objects are stated in their annual report for last year, and in furtherance of these objects they appeal to the charitable public for subscriptions.

The second object of the institute is to use suitable means for training the blind in such industries as may promote their self support and for providing those requiring it with regular employment.

The industrial department of the institute was not self-supporting in the year of the report. The accounts show a deficit of £50, 14s. 5d. on the year's working, which sum had to be met from the other resources of the institute, which are derived from charity. It was proved that this department could not be successfully worked as a commercial undertaking independent of charitable aid.

There are three classes of workmen employed in this department, and they are graded at the discretion of the foreman. The first, or learners', class receive their board, lodging, and clothing from the institute, and are paid sixpence a week. The second class, who may be compared to apprentices, receive their board, lodging, and clothing, with five shillings a month in money. The third, or journeymen, class consist of those who receive wages (varying at present from 15s. to 20s. a week according to proficiency) and provide their own board and lodging and clothing, and live where they like. There are at present six workmen in this class.

The appellant in this case was a member of the second, or apprentice, class, and received his board, lodging, and clothing, and five shillings a month in money. The whole value of the board, lodging, clothing, and money provided by the respondents for the appellant amounted on an average to 15s. a week.

The workmen in all three classes in so far as sui juris are free to enter and to leave the institute's industrial department, and the institute has the power of dismissing them as it thinks fit, and of selecting who shall be their workmen.

At the time of the accident the respondents were receiving from the Parish Council of Kilmonivaig (whose pauper the appellant was) for the maintenance of the appellant the sum of 4s. a week, and also that Parish Council refunded to the institute the cost of the appellant's clothing, which amounted to £4 per annum. The respondents also received from the Donald Fraser Bequest for the benefit of the Blind in the County of Inverness a grant of £20 annually specifically on the account of the appellant.”

The Sheriff-Substitute further stated—“On these facts, I held that in respect that the appellant was in receipt of parochial and charitable relief he was not a workman in the sense of the Act founded on.”

The question of law was — “Was the appellant a workman in the sense of section 13 of the Workmen's Compensation Act 1906?”

The case was heard on 9th March 1911, and on 18th March 1911 the Court remitted to the Sheriff-Substitute for further findings in fact.

The Sheriff-Substitute reported as follows—“(2) In the case of the first and second classes of men engaged in the industrial department, the men receive industrial training in the institute; and the institute boards them out, supplies them with clothing, and makes a pecuniary allowance as pocket-money. In both cases the aggregate value of the work done by the recipients is less than the sum expended on them, including the value of instruction, but there was no evidence of the individual work done by the appellant. When a blind workman is, in the judgment of the respondents' officials of their industrial department, able to support himself by his earnings, he is transferred to the third or journeyman class. (3) … Arrangements for contributions from the Parish Council of Kilmonivaig and from the administrators of the Donald Fraser Bequest were made, were subsisting at the date of the accident, and were continuing at the date the evidence was led, viz., 7th July 1910. (4)

There was no evidence of the average weekly earnings of the appellant beyond the statement by the respondents' officials that the sum of 5s. a month paid to each of the second or apprentice class was supposed to represent 20 per cent. of the average earnings of each member of that class.”

The following additional question of law was added—“(2) If the first question be answered in the affirmative, do the average weekly earnings upon which compensation to the appellant falls to be assessed consist of ( a) the whole amount paid by the respondents to or for behoof of the appellant, or ( b) the said amount less the contributions received by the respondents for behoof of the appellant, or ( c) the average earnings as calculated by the respondents' officials, viz., 6s. 3d. a week.

Argued for the appellant—(1) The contract between the parties was clearly one of service. The defenders carried on an industrial department, and one of their objects was to make the blind self-supporting. The present case was a fortiori of Gilroy v. Mackie, 1909 S.C. 466, 46 S.L.R. 325, and the essentials of a contract of service, freedom of contract, payment, and power of selection and dismissal, were present here. (2) Earnings in the sense of the statute meant gross earnings. In any event, the Sheriff had found as a fact that the man's earnings were 6s. 3d., and that finding was final.

Argued for the respondents — (1) The relationship between the parties was one of charity, and not of master and servant. The institute did not carry on a trade or business in the sense of the statute, and the appellant was not a workman earning wages. The appellant's status was that of an inmate of a charitable institution entitled to certain privileges and bound to perform certain duties. There was no proper locatio operis. The respondents

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received payments on behalf of the appellant, which came to within a few pounds of the amount expended on him— Burns v. The Manchester and Salford Wesleyan Mission, July 21, 1908, 99 L.T. 579. (2) If the first question was answered in the affirmative, the amount so received should be deducted from the amount expended upon the claimant, and compensation should be fixed upon this basis.