Hatzimanolis v Ani Corporation Limited

[1991] HCATrans 185

..

• 'I

• --~·~

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No SS0 of 1991

B e t w e e n -

FRANK MICHAEL HATZIMANOLIS

Applicant

and

ANI CORPORATION LIMITED

Respondent

Application for special leave

to appeal

MASON CJ
DEANE J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON MONDAY, 5 AUGUST 1991, AT 12 NOON

Copyright in the High Court of Australia

Hatzimanolis 1 5/8/91

MR W.H. NICHOLAS, QC: If the Court pleases, in this matter

I appear with my learned friend, MR M.J. GORRICK,

for the applicant. (instructed by T.D. Kelly & Co)

MR J.G. POULOS, QC: If the Court pleases, I appear with my

learned friend, MR C.R.R. HOEBEN, for the

respondent. (instructed by Connery & Partners)

MASON CJ: Yes, Mr Nicholas.

MR NICHOLAS:  Your Honours, the point in this matter is a

short one but one of the utmost significance to my client.

Your Honours, the circumstances which give rise to the application are set out on page 51 of the book, and if I can take Your Honours to that, with respect.

It will be seen that:

The applicant was in the employ of the

respondent when ..... he was involved in a motor

vehicle accident which rendered him a

quadriplegic.

At that time he was some 23 years of age.

The circumstances of the employment,

Your Honours, are set out on page 52.

MASON CJ: Yes, we are familiar with that, Mr Nicholas.

MR NICHOLAS: If Your Honour pleases.

MASON CJ:  Now you might immediately proceed to persuade

us, or endeavour to persuade us, that the question
is one that merits t_he grant of special leave to

appeal.

MR NICHOLAS:  Thank you, Your Honour. Your Honours, may I

hand up to you copies of the Workers Compensation

Act, the point being, of course, the construction of the definition of injury within the provisions of section 4 of the Act.

Your Honours, that definition may be found on

page 5 of the Act and, no doubt, it is an

expression familiar to the Court, with respect:

"injury" -

(a) means personal injury arising out of or in the course of employment;

We are not concerned with that limb which is "out of" but "in the course of employment", Your

Honours.

Hatzimanolis 2 5/8/91

Your Honours, at the outset we would emphasize

that the drafting of the provision, of course,

omits the word which is commonly found in

It is "in the course of employment". judgments, "his employment" or any other pronoun.

Our submission to Your Honours, with respect,

is that at the end of the day, a situation such as

that in which the applicant here was involved in

arose out of the circumstances in which he found

himself, the direct product of the relationship

between his employer, that is to say, the

employment relationship.

Your Honours, the error one can shortly state

it, which we contend the Court of Appeal made, was

to so construe the provision to which I have

referred you as to effectively exclude

consideration of the broader concept of the

employment relationship so as to tie it back to

circumstances related to the actual performance of

the work or, as Mr Justice Clarke seemed to

approach it, as to looking at the place at which

the performance of work was undertaken.

What we are putting to the Court is, with

respect, that there is just simply no basis in the

legislation for tying back the provision to bring

about that result, and that it is appropriate to

look at the relationship of employment in order to

give effect to the purpose and objects of this

legislation. In other words, with respect, that

this Court would undertake the same task as it did

recently in Walker v Wilson.

Your Honours will remember the jockey case,

the journey case, the jockey who was obliged

to travel from Wickham in Western Australia back to

his home in Perth. This Court looked at the

particular provisions of the journey provisions in

that State's Workers Compensation provision and

made plain the necessity to have regard to the

overall purpose and objects of this type of

legislation.

Your Honours, as it happened, the judgment of

this Court was delivered but a few days before the

ju9gment was delivered in the Court of Appeal in

this case.

What we are saying, with respect, is that by

tying back the activity to the particular work or

to the particular place, the Court of Appeal has

fallen into error and Your Honour the Chief Justice

asked me to put the reasons why this case was one

of importance, and we would say this. Situations

of the kind which my client was involved in are

Hatzimanolis 3 5/8/91

commonplace in Australia now. It is quite common

that work is undertaken by selected and skilled

groups of employees in remote and isolated areas.

That, as one would know, is happening and has been

happening for many years in this country.

Secondly, Your Honours, the Court of Appeal of

New South Wales now has the power - indeed is

obliged - to undertake a rehearing of the matter,

and indeed, I think this case was the first in

which it was exercising the powers recently given

to it.

Thus, one is faced with the situation that

henceforth, if we are correct in submitting that the Court of Appeal was in error in too narrowly

interpreting the legislation, it may be feared that

the Court of Appeal will continue to deal with

cases such as this one in the future in the same

way.

The third matter, with respect, is this, Your

Honours. As far as we have been able to ascertain

it, this Court has not considered the concept of

employment within the meaning of this provision in

the sense of the looking at the overall

relationship of employment. It is true that in

many of the cases examples are given where the

court looks to determine whether or not the injury

was one sustained whilst the employee could be said

to be engaged in work, or alternatively, doing

something incidental to work.

We have not been able to find a case, although

examples could perhaps come to mind in the
discussions in the cases, where the Court has

really directed itself to look in the broad at the
relationship. That is what we say - - -

MASON CJ: But I do not see that that is an argument, the

fact that the Court has not had an opportunity or

has not looked at a question.

MR NICHOLAS:	Your Honours, except that we would say this, that an opportunity arises we would put, with
respect, in this case, for the Court to look at the question in order to make plain - - -

MASON CJ: Yes, but to say that there is an opportunity is not to say that that is an argument in itself for

the grant of special leave.

MR NICHOLAS:  No, I accept that, with respect, certainly,

Your Honour.

MASON CJ: There is nothing more offputting, in an affidavit

in support of that special leave application than

Hatzimanolis 4 5/8/91

to find that the deponent says this case provides

an opportunity for the Court to look at this

question.

MR NICHOLAS: Well, Your Honour, we will bear that in mind

for future applications, Your Honour, with respect.

MASON CJ: It was said advisedly, Mr Nicholas.

MR NICHOLAS:  I realize that. Your Honours, in this

situation we have the Court of Appeal concerned to

express - take Mr Justice Mahoney, for example;	he
found no settled approach, as he said, to the way in which the provision should be construed.

Mr Justice Clarke acknowledged the difficulty that

courts had in dealing with it and giving effect to

it.

In turn, each of the judges of the court

appeared to find against us taking different

approaches to the provision and thus, Your Honours,

we would put, as a legitimate ground for attracting

this Court's interest, is the necessity that the

matter be settled and that the doubts and

difficulties which appeared to beset the individual

judges of the Court of Appeal be resolved for their

assistance and for the assistance of those who have

to deal with this Act.

DEANE J: But nobody is ever going to resolve those, Mr

Nicholas. Is not the basis of your application, be it good or bad, simply this: that we are in an

area where decisions which, on one approach, seem

to be on matters of fact can assume extraordinary

importance and this decision has some of the

indicia of falling into that category and becoming

a measuring rod, as it were.

MR NICHOLAS:  I see what Your Honour is putting, with

respect. We are not bringing it before

Your Honours persuaded by the magnitude of the

effect of the Court of Appeal's decision on my

client, with respect.

McHUGH J: That is not the point, is it? The point Mr

Justice Deane is putting to you is that you can

only fill out the content of the expression "course of ~mployment" by reference to the facts of decided cases and in this area one proceeds by way of

analogy.

If this decision is correct, then by analogy

many people in similar occupations will be outside

the scope of the Workers Compensation Act, so that

is the significance of it.

Hatzimanolis 5/8/91

MR NICHOLAS:  Yes, Your Honour. I am indebted to

Your Honour.

DEANE J: Well, is that not it?

MR NICHOLAS: That is it, with respect.

MASON CJ:	You may do damage if you proceed further.
MR NICHOLAS:	I was just looking at the notes, Your Honour,

to see. I think that is it, with great respect.

MASON CJ: Thank you, Mr Nicholas. Yes, Mr Poulos.

MR POULOS:  By analogy, the reference to the previous

decisions of the High Court need to be looked at,

and I am mindful of the recent decisions of the

Court of Appeal at the same time. This case was

simply one in which an invitation was extended to

an employee by another employee -

DEANE J:  Who was the supervisor.

MR POULOS:  Who was the supervisor. No compulsion was

presented; no inarticulate hidden premise that if

you do not arrive on the scene with us you will be

somehow a person outside the group and it will

somehow reflect upon your employment.

DEANE J:  Mr Poulos, it may well be right, but a lot depends

on how you look at these things. The effect of

this decision is that a company employee who, with

the authority of the company, was driving a company

vehicle carrying company employees on a company

organized outing, was not acting in the course of

his employment. That may be right, it may be wrong

but, as I said to Mr Nicholas, it has got the

superficial indicia of being a hallmark case in

this area. It was on that basis I was suggesting

to him that it does have an element of importance

in a field which, of course, is of tremendous

importance.

MR POULOS:  I do not wish for one moment to decry that

proposition, that it is not of importance. in the landmark decision, Humphrey Earl v

Spe~chley, where the employee was riding the

employer's motor bike and was with one of the

employer's customers - - -

McHUGH J: That is nearly 40 years ago, that case was

decided.

MR POULOS: True, but there has been repeated and frequent

applications of the principle. It is a life raft

Hatzimanolis 6 5/8/91

to which every judge who has ever had to consider

this problem goes.

McHUGH J: But only in terms of the statement of principle.

It is like comparing Wittingham's case back in 1929 when this Court said playing cricket in the course

of employment was not in the course of

employment -

MR POULOS:  I was not going to refer to that case.

McHUGH J: But 30 years later, in Oliver, the Court said the

opposite.

MR POULOS:  Yes, that is true. I am very mindful of the

fact that the circumstances change. The camping

cases, Danvers case and the like, all had the

proviso in the statement of facts by the court.

What would have happened if Danvers had - what we

did not know what Danvers was doing at the time he

was burnt to death in the railway carriage. The

High Court always allowed, as an exception, that something might be done by an employee whilst he is

in a remote location that takes him outside the

course of his employment. There was no evidence as

to what Danvers was doing and if one was to put an

absurd example of Danvers conducting an illicit

still and it caught fire at the time that he was

burnt to death, then he would be outside the course
of his employment.

In this particular case, the protection that is afforded by the Compensation Act to a worker

would be quite clearly in place if he was in the camp where he was hurt and having him moved, for example. But, by argument by analogy one looks at

the questions of fact and degree that do arise and

say, "Well, what are the indicia which take him

outside?". Firstly, distance. This man went

400 kilometres to Wittenoom Gorge and was returning

at a point in time when it was dark - 7 o'clock in

the evening - he having left early in the morning

with the group. That geographical factor alone is	sufficient to say that this, as a question of fact
and degree, should have been decided against the
worker.
_ The purpose of the journey is all important. It-was a sightseeing trip, arranged by what I might
call a social organiser amongst the group, who
happened also to fulfil a role of being a foreman
at the time. Look at the role he was performing.
The evidence was that he went around and discussed
with his workmates, "What shall we do on the
weekend?" It was a process of consultation - - -

McHUGH J: It was a company vehicle, two company vehicles.

Hatzimanolis 7 5/8/91

MR POULOS:  Yes, that is true, as I say, but to go back to

the point that I was making before: in

Humphrey Earl v Speechley, that was not important to

the Court then. The question is - - -

McHUGH J:  He was riding his own bike in Humphreys, was he

not?

MR POULOS:  No, it was the company's bike. It was a

sidecar, he being a scales mechanic at the time, and

it was, as you say, 40 years ago.	They do things
differently now.

Of course there are ample cases where

employees have been driving cars in the alleged
course of their employment and have held to be

disqualified. In the general law, there are ample

cases where employers are not held to be

vicariously liable where the employee was driving

the company car.

These points of principle have been dealt with

by, for example, the House of Lords in the

compensation cases in the 1920s. Have we gone so

far to leave behind the point that was made in one

of those cases that just because an employer

provides a special railway carriage for the

employees to go to a colliery, that he is in the

course of the employment.

Now that case, if my memory serves me right, is one in the 1924 Appeal Cases, not referred to

here, but I just put it by way of argument, that

simply because a benefit is conferred upon an

employee by the employer does not make it the case

that he is in the course of his employment. "There

is no obligation" is the words that were used in

that case - and forgive me if I cannot remember the

name of it for the moment - but there was no

obligation and there was really an invitation: "If

you wish to come to work we will provide you with a

railway carriage, in company with others."

Compensation law has always had this

distinction between acts which fall on one side of

the line or the other. I put this argument in

answer to the hypothetical question that is raised

by the Court. It is a matter of importance, true

enuugh, but it is also a matter of importance to
employers and their insurers to know where the line

should be drawn.

If this Court were to take the view that the

old cases, by analogy, by effluxion of time, should
be discarded, this is not the case to do it in,
because this is a case where the Court of Appeal

had no difficulty in finding that Hi.s Honour, the

Hatzimanolis 5/8/91

original trial judge, was in error because of the

very factors I have put forward: the geographical

elements in the case; the purpose of the visit;

and thirdly, and more importantly, the fact was

that the Court of Appeal said, by analogy, "If he

was in the camp having a meal, having a shower or a

bath", we know where he would stand there but this

is a case which is clearly distinguished as a

question of fact.

If I might just refer to my learned friend's

reference to this Court's decision in Walker v

Wilson as support for his argument. It was said in
Walker v Wilson by the Court, which is Your Honour

Mr Justice Deane and Your Honour Mr Justice McHugh with Your Honours Dawson and Toohey:

No doubt, there could be circumstances in

which delay of a dismissed employee in setting

out on a journey which would otherwise satisfy

the requirements of section 19(l)(a)(iii)

would take the case out of the operation of

that sub-paragraph. It is unnecessary to

determine whether, in such a case, the delay should be seen as breaking the nexus between

the journey and the previous employment to an

extent that the journey could no longer be

seen as coming within sub-par.(iii) or whether

the delay constitutes a"substantial

interruption of", or "substantial deviation

from", the journey within the meaning of those

words -

and then you dealt with the facts.	It suffices to
say -

McHUGH J: But that case really does not throw any light, at

least speaking for myself, on this particular

problem; it is a different case altogether.

MR POULOS: True, except I pray in aid the next paragraph

which said well perhaps if there had been more

delay, the question of whether or not there had
been a break in the nexus would have arisen.	In

this case this is the proverbial frolic of his own.

I hate to use those words, and over the years the

High Court and other courts have tried to figure out_ some euphemism for them.

McHUGH J: But is it any more a frolic of his own than

people who go and play rugby league or cricket

during lunch hour, which are now held to be within

the course of the employment? Here, are a group of

men in a remote area in Western Australia, or

wherever it was, and they have time on their hands

between actual work, so the company provides the

Hatzimanolis 9 5/8/91

vehicles, they go away on this sightseeing tour and

one of them is injured.

MR POULOS:  Yes, but the company did not provide the

vehicles for them to do that. They decided to use

the vehicles for that purpose. It was not -

McHUGH J: But they are standing by, and what is the

difference between a case like this and Kirkland

where the Qantas steward was held to be in the

course of his employment when he fell through the

door in a Greek nightclub?

MR POULOS: Well, I have had some little experience of both.

Kirkland's case was four square within the analogy

argument that the Court of Appeal used, because

Kirkland was having a meal at a short remove from

the hotel at which he was billeted by the company.

It was within very close contiguity to the time which his shift finished. That is the question of

degree there.

But in all of these cases, and one looks at

Kirkland for example: Kirkland did not go to a

nightclub, it was a restaurant, Fulya's Restaurant,

which is no longer, alas, in business -

McHUGH J:  I appeared for him. My recollection was that it

was a nightclub.

MR POULOS:  No, it was a restaurant open at night. My

recollection of that case is covered by a knowledge

of the actual factual, so I have to be very careful

to distinguish in my mind that which is reported

and that which in fact happened.

The most important thing about that case, and

cases like it, was that the courts have always been

at great pains to point out that not everything

that a person might do in those circumstances and

at his place of work is considered to be in the

course of employment, and that is the traditional

safety valve that all courts of appeal always

allowed in such circumstances.

For example Bill Williams v Williams, which is

not a case 40 years old, which is very recent,
w~i~h took, some might think artificially, Williams

out of his employment when he turned to escape the

assailant and ran out on to the street. That

circumstance is the High Court felt that he had

taken himself out of the course of his employment.

In that case, going to Weston and others,

always you have the safety valve or the rider which

says that not everything that the employee does in

those circumstances can be considered in the course

Hatzimanolis 10 5/8/91

of the employment. You have to look at the nature

and quality of the act that he is performing at

that time.

If I might go back to a point Your Honour

Mr Justice McHugh raises: simply because all

workers in a group take themselves outside the

course of the employment they cannot invest the

quality and nature of their act with an employment

quality simply because they all decide to do it.

If they decide to take the company's vehicles and

go to a two-up game and one of them is shot in the

course of the two-up game, then does it simply

decide the case in favour of the worker that they

all decide to do that and take the company vehicle

to do it, even if they might have authorization and

permission to use the company vehicle to go on a

social outing?

That is all that one can say has happened

there and if this matter were to go to a full

argument, the best that the employee can do in

these circumstances is to say that Mr Pope, who was

the supervisor, had an idea that they might like to

go, and in those circumstances Mr Pope extended an

invitation which was considered by all of them one

that they could accept, except one man, and he
stayed behind.

An invitation is quite different to the rugby league case or the soccer cases which have been

decided in the courts in the last 40 years. Those

cases are organized games that were played not only

with the collaboration of the employer in many

cases, but with the support of the employer. Time

was given off and the ones that were successful, in

my recollection, were all ones where the workers

were paid for the time that they had off.

But there have been very few successful cases of that nature in recent times. The more recent

cases of Dutra v AIS in the Court of Appeal was one

where the worker was found against. There is one

Commonwealth v Lyon, which is a judgment of a

single judge at the Federal Court, His Honour

Mr Justice Deane, as he then was. That is one of

the cases in which - but that was back in the 1970s

I believe - adopting the time argument. Obviously

that, by the effluxion of time, has proved

incorrect.

There have been many instances of league and

soccer games where there have been decisions in

favour of the employer, for the very reasons that I

have now referred you to: the nature and purpose

of the activity, the fact that it occurred out of

working hours.

Hatzimanolis 11 5/8/91

In this case may I say that the facts were

that every Sunday this group of people did

something together as a group and Mr Pope, it was

put to the Court of Appeal, really did become a

social organizer for the group rather than their

superior. That was why the group did those things.

One very telling argument was put on behalf of the employer, in my respectful submission, from

Goward's case, which is a 1957 decision, and in

Goward's case that was a case where the employee

was walking across a train line to the station from

his camp for some private purpose outside of

working hours and the High Court joint judgment of been doing just that, that he was on a private

purpose.

They referred to the question of the special

risk. This is reported in (1957) 97 CLR 355. The

judgment is fairly short, page 364 at about

point 7:

The question is one of cause, but it is not enough to point to antecedent situations in the absence of which there could not have been an accident of the description involved.

It is correct no doubt that if the camp had

not been near a railway and if the deceased

had not been living in the camp the accident

would not have happened. But these are no

more than antecedent conditions which are

preliminary to, but hardly operative causes

of, the accident.

No special risk attached to the

employment simply because the camp was near

the railway. Anybody desirous of using the

station or posting a letter must use the
crossing unless _he was on the south side of

the line. It was a public crossing open for

all to use.	No duties of the deceased
required that he should cross. It was
entirely because it was the public means
provided for getting to the station or station
house from the north. If, being in a confused
condition, he made a mistake at the crossing the risk of his doing so was not an incident attached to his employment. If on the other
hand he was run down through the train moving
or being in motion as he crossed, that does
not seem to be a risk particularly associated
with the fact that as an incident of the
employment he lived in the camp. The sparse
habitation of the place tends to make it less
apparent that the risks of the crossing really
belong to the order of ordinary public risks

Hatzimanolis 12 5/8/91

not specifically associated with the

employment. If there were large numbers of

persons using the crossing this would seem

clear. But the fact that the camp brought men

to a place which doubtless few used does not

mean that an ordinary public risk attending

all crossovers becomes a risk of the

employment, the duties of the deceased not

having led him to cross on the occasion of the

accident.

Those words, in my submission, go to answer

the proposition that a person who is in an area
because of his contract of employment is ipso facto
covered by the Compensation Act. Without adopting

the specific words of the argument, what I am

putting is that this is yet another example of the

risk that was undertaken by Mr Hatzimanolis at this

particular point had no employment factor involved

with it other than he was with his work mates at

the time.

The words in Humphrey Earl v Speechley are

that he is doing something in order, at the end of

the day, to carry out the interests of his employer

and no matter what one can do to water that down or

to give it a softer approach, he was not performing

any function in that respect.

MASON CJ: Yes, Mr Nicholas.

MR NICHOLAS: 

Your Honours, the Court will have noticed of

course that the word "his" does not appear before
the word "employment" in the section, and that when
one is looking at the concept of employment within
the meaning of this provision one may look at it in
order to define the boundaries of the relationship

from either the viewpoint of the employer or from

the employee.

The situation in this case is just simply

this, that when these men were signed up in

Wollongong they were informed that all they would

have to worry about was their beer and cigarettes,

that there would be the opportunity for doing the

very thing which the supervisor provided for them

on those Sundays when they were not actually called
upon to work. Part of the condition of their
employment was that they should be ready to work on

Sundays if required, and by about the Thursday

preceding in each of the two Sundays prior to this

one they were informed that they would not be, and

thus the supervisor made available the trucks, the

food and the occasion for this activity, and we

would put it - - -

Hatzimanolis 13 5/8/91

McHUGH J: Supposing that on this Sunday, instead of going

out in the truck, the applicant decided to walk

into the town of Newman - I assume they have a

picture theatre there - supposing he went there for

that purpose and he was run over by a car on his

way into the town. Would it be in the course of

his employment then?

MR NICHOLAS:  It may very well be, Your Honour, but if one

looks at - and this is where it becomes a question

of fact and degree, a situation such as this -
Your Honour obviously remembers the Kirkland case.
The other case which is often cited in these

matters is the Rolls case, the man in Hong Kong who

was set upon by thieves in his apartment. He, or

rather his widow, was found to have a claim and

that that situation was found to be in the course

of his employment.

Your Honour, we are in a stronger position,

with respect. If it is necessary, as we concede it

must be, to look for links with the employment

relationship, then you have them very clearly here

because the employer, quite clearly, one might

infer from the evidence, recognized that there

should be benefits to be provided, appropriately

provided having regard to the situation in which he

was requiring the men to work and the demands that

he was making of them.

And if one came at it another way, with great respect, if one asked the question, "At the time

that the accident happened, could it be said that

the employment relationship had ceased?", we would

put with respect that clearly the answer to that

question would be "No".

At the risk of repetition, Your Honour, what

we are saying is that the error has been the

failure to look at the relationship which is the matter in the definition section. It is the failure to look at that in the broad, having regard	to a modern employment-employee relationship and to	anchor it back and limit it to his employment
define that by looking at what he is actually doing
or what he is actually required to do, and so on.

For those reasons we would put to Your Honour

that this is a case for special leave.

MASON CJ:  Thank you, Mr Nicholas. The Court will give its

decision in this matter at 2.00 pm.

MR NICHOLAS: Will Your Honour excuse me at 2.00 p.m.

Hatzimanolis 14 5/8/91

MASON CJ: Yes.

AT 12.37 PM THE MATTER WAS ADJOURNED

UNTIL LATER THE SAME DAY

UPON RESUMING AT 2.02 PM:

MASON CJ: There will be a grant of special leave to appeal

in this case.

MR GORRICK:  Your Honours, thank you. We would be seeking

costs in that event.

MASON CJ:  I think you can seek costs if and when you

succeed in the appeal.

MR GORRICK: Yes, of course, I meant in relation to the

application.

MASON CJ: Well, costs of the application are costs in the

appeal.

MR GORRICK:  Thank you, Your Honour.

AT 2.04 PM THE MATTER WAS ADJOURNED SINE DIE

Katzimanolis 15 5/8/91