Roads & Traffic Authority of NSW v Sheppard

[2007] NSWWCCPD 146

WORKERS COMPENSATION COMMISSION

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Roads & Traffic Authority of NSW v Sheppard [2007] NSWWCCPD 146

APPELLANT:  Roads & Traffic Authority of NSW

RESPONDENT:  Derek Sheppard

INSURER:Treasury Managed Fund

FILE NUMBER:  WCC16445-06

DATE OF ARBITRATOR’S DECISION:          9 March 2007

DATE OF APPEAL DECISION:  27 June 2007

SUBJECT MATTER OF DECISION: Whether injury arose out of employment; sections 4 and 9A of the Workers Compensation Act 1987.

PRESIDENTIAL MEMBER:  Acting Deputy President Robin Handley

HEARING:On the papers

REPRESENTATION:  Appellant:      Thompson Cooper Lawyers

Respondent:   Nagle & McGuire, Solicitors

ORDERS MADE ON APPEAL:  The decision of the Arbitrator dated 9 March 2007 is confirmed.

The Appellant is to pay the Respondent, Mr Sheppard’s costs of this appeal.

BACKGROUND TO THE APPEAL

1. On 27 March 2007, the Roads & Traffic Authority of NSW (‘the RTA’) sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against the decision of an Arbitrator dated 9 March 2007. The Respondent to the appeal is Derek Sheppard. The RTA’s workers compensation insurer is the Treasury Managed Fund (‘TMF’).

1. Mr Sheppard was born on 2 November 1969 and is aged 37. He is employed by the RTA as a Certification and Calibration Officer with the Camera Enforcement Branch. On 6 August 2006, Mr Sheppard was riding his motorcycle when he collided with a deer, suffering injuries to his arms, neck and left knee. He claims the injuries arose out of or in the course of his employment. On 27 August 2006, Mr Sheppard lodged a claim with the TMF, which subsequently denied liability on the ground that the injury was not work-related. Mr Sheppard returned to work on light duties on 9 October 2006 and resumed full duties in November 2006.

1. On 19 October 2006, the Commission registered Mr Sheppard’s ‘Application to Resolve a Dispute’ in respect of his claim for weekly compensation and medical expenses. The RTA’s ‘Reply’ was filed on 9 November 2006. On 19 January 2007, an Arbitrator conducted a teleconference with the parties. On 7 March 2007, conciliation having proved unsuccessful, the Arbitrator conducted an arbitration hearing. She gave an oral decision at the conclusion of the hearing.

THE DECISION UNDER REVIEW

1. The ‘Certificate of Determination’, dated 9 March 2007, records the Arbitrator’s orders as follows:

“1. That the Respondent pay the Applicant weekly compensation at the rate of $1,239.75 from 7.8.06 to 6.10.06 inclusive under section 36 of the Workers Compensation Act 1987.

2. That the Respondent pay the Applicant’s section 60 Workers Compensation Act 1987 expenses on production of accounts or receipts.

3. That the Respondent pay the Applicant’s costs as agreed or assessed. I certify this case to have a level of complexity in the preparation for arbitration and the arbitration for both the Applicant and the Respondent and uplift costs by 10%.”

1. In her Statement of Reasons given orally at the conclusion of the hearing, the Arbitrator noted that there was no dispute about the nature of the accident and injuries suffered by Mr Sheppard incurred while he was in the process of moving from Nowra to Picton, that he was totally incapacitated between 7 August 2006 and 6 October 2006, and that his income at that time was $1,239.75 per week. She identified two significant issues in dispute: first, whether Mr Sheppard suffered injuries arising out of or in the course of his employment with the RTA (as required by the definition of ‘injury’ in section 4 of the Workers Compensation Act 1987 (‘the 1987 Act’)); and, second whether employment was a substantial contributing factor to his injuries (as required by section 9A of the 1987 Act).

1. The Arbitrator found that Mr Sheppard’s moving house from Nowra to Picton “took place at the instigation and request of the employer for the benefit of the employer. It was paid for and, to some degree, facilitated by the employer” (transcript p 38). The RTA had asked Mr Sheppard to move from the RTA’s Camera Enforcement Branch office based in Nowra, covering the Southern Region bounded by Wollongong, Bega and Queanbeyan, to the Camera Enforcement Branch office in Blacktown. The Arbitrator distinguished the case of Klevjer v Ambulance Service of NSW [2001] NSWCCR 69 (‘Klevjer’) on the ground that in that case the relocation was instigated by the employee, whereas in Mr Sheppard’s case the relocation was at the request of and facilitated by the employer. The Arbitrator therefore found that the injuries suffered by Mr Sheppard arose out of his employment with the RTA.

1. Secondly, with regard to whether employment was a substantial contributing factor to the injuries, the Arbitrator “looked at the issue of time, place and circumstance” (transcript p 42). Mr Sheppard’s evidence was that he was granted three days special paid leave under the RTA’s relocation policy for the purpose of the move: Wednesday 2 to Friday 4 August 2006. The removalists packed his belongings in his rented house in Nowra on 2 August, moved his belongings to his newly rented house in Picton on 3 August, and Mr Sheppard returned to the Nowra house on 4 August to clean the house and return the keys to the real estate agent.

1. Mr Sheppard had three vehicles to move from Nowra to Picton: his car, his motorbike and his work vehicle. He drove his car to Picton on 4 August, where he left it before returning in the removal truck to Nowra so that he could then drive his work vehicle to Picton. He left his motorbike in the carport of the Nowra house because there had not been sufficient room for it in the removal truck. He spent the remainder of 4 and 5 August unpacking his belongings and settling into the Picton house. On the afternoon of 6 August, Mr Sheppard arranged for his girlfriend to give him a lift back to Nowra so that he could collect his motorbike and drive it to the house in Picton. He was due to start work at the Blacktown office of the RTA’s Camera Enforcement Branch on the following day, Monday 7 August.

1. With regard to the time and place of the accident, the Arbitrator found that Mr Sheppard had paid leave on the Wednesday, Thursday and Friday. While the weekend was not a period of paid leave, it immediately followed the paid leave:

“The time is immediately involved in the process of moving. The place is – and I accept – from point A, Nowra, to point B, Picton, the area to be moved. It’s not just a casual ride. And the circumstances are: finalise and be at work on Monday. To that end, I am satisfied that employment is a substantial contributing factor.”

ISSUES IN DISPUTE

1. The RTA does not dispute that Mr Sheppard was incapacitated for work for the claimed period because of the injuries suffered in the motorcycle accident. However, the RTA contends the Arbitrator erred in determining that the injuries arose out of Mr Sheppard’s employment and that his employment was a substantial contributing factor to the injuries. The parties’ submissions on these issues are discussed below.

ON THE PAPERS REVIEW

1. Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:

“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”

1. I have had regard to Practice Directions Numbers 1 and 6, the documents before me, and the submissions of the parties: the RTA submits that because the matter involves the interpretation of a statute and the consideration of authorities, the parties should have the opportunity to make oral submissions; Mr Sheppard’s solicitors submit that the matter can be dealt with ‘on the papers’. I am satisfied that, with the benefit of the parties’ written submissions on the issues in dispute, I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

1. Neither party sought to adduce fresh evidence.

LEAVE

1. Before proceeding to deal with an appeal, the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act. With regard to section 352(2), I am satisfied that the amount of compensation at issue is at least $5,000. Accordingly, the section 352 threshold has been met, and I grant leave to appeal.

SUBMISSIONS

1. The RTA submits that the Arbitrator erred “in concluding that the differences between the facts in Klevjer and those of the present case were of significance” (submissions paragraph 13). It noted that a factor motivating the applicant in Klevjer to relocate was to provide “a more salubrious environment for the family in which to raise his three children” (Klevjer, at paragraph 2). In the present case, while the initial ‘suggestion’ to relocate came from Mr Sheppard’s supervisor, there was no issue that one of the factors motivating Mr Sheppard to agree was that if he relocated he would be nearer his children. The RTA referred to Burke J’s conclusion in Klevjer, at paragraph 17, in support of its contention that Mr Sheppard’s injuries are not compensable:

“Many activities have an apparent nexus to employment though neither part of the employment nor caused by the employment. All the activities of going to the place of work have this “causa sine qua non” status; rising, bathing, dressing, breakfasting, journeying. Special provision in the statute apart, nothing that occurs in these events can constitute injury arising out of or in the course of the employment. They are domestic events, necessary precursors to employment activity but not part of the employment. In my view the activities of Mr Klevjer on this occasion have a similar type of connection with employment, events that necessarily take place before relevant employment activities can be embarked upon, but themselves neither part of those employment activities nor brought about by the needs of the employment.”

1. The RTA notes that in Klevjer, Burke J did not consider that financial assistance with the costs of relocation was germane to the issue in that case. The RTA also noted Mason J’s statement in Mercer v ANZ Banking Group Ltd (2000) 20 NSWCCR 70 (‘Mercer’), at paragraph 34, where he agreed with the view expressed by Ashley J in Popovski v Ericsson Australia Pty Ltd [1998] VSC 61, that the requirement that injury arise out of employment is a more stringent test than the requirement that employment be a substantial contributing factor to the injury.

1. Mr Sheppard’s solicitors refer to the decision of Deputy President Roche in JP Morgan Holdings Australia Ltd t/as JP Morgan Operations Australia Ltd v Haider & ors [2006] NSWWCCPD 234 (‘Haider’), at paragraph 52, where he referred to the Henderson-Speechley test set out by Dixon J in Henderson v Commissioner of Railways (WA) (1937) 58 CLR 281, at 294 (referring to Humphrey Earl Ltd v Speechley (1951) 84 CLR 126), and summarised by the majority of the High Court in Hatzimanolis v ANI Corporation Ltd (1992) 173 CLR 473 (‘Hatzimanolis’), at 9:

“Dixon J ... suggested that, in cases which were not concerned with injuries sustained during actual work, the test of whether an injury had been sustained in the course of employment ultimately depended upon whether the workman was doing something which he was ‘reasonably required, expected or authorized to do in order to carry out his duties’.”

1. Deputy President Roche noted that in Hatzimanolis, their Honours stated, at 13, that this test no longer accurately covers all the relevant cases of injury and a reformulation of the principles was required to include cases where an interval or interlude in a period of work occurs and the employer has expressly or impliedly induced or encouraged the employee to spend the interval or interlude at a particular place or in a particular way.

1. Mr Sheppard’s solicitors contend that because, unlike in Klevjer, the employer approached Mr Sheppard seeking that he relocate for its purposes and provided paid leave and paid relocation expenses, it is clear that the employer “both induced and encouraged the activity being carried out by” Mr Sheppard, and it is immaterial that the relocation was also convenient for him. It was Mr Sheppard’s employment that “placed him on the F6 Freeway” at the time the accident happened and, accordingly, he was in the course of his employment.

DISCUSSION AND FINDINGS

1. Deputy President Roche undertook a comprehensive review of the relevant case law in Haider and there is no utility in my repeating such a review here. In my view, the words “arising out of” that appear in the definition of ‘injury’ in section 4 of the 1987 Act point to the inclusion of a causal relationship with the employment that does not require a direct or physical connection. However, for liability to arise from that causal relationship, the activity giving rise to the injury must be one which has been expressly or impliedly induced or encouraged by the employer – that has, effectively, arisen out of the employment.

1. In Klevjer, the applicant was an ambulance officer stationed at Mt Druitt. Burke J found, at paragraph 2, that the applicant “desired a more salubrious environment for the family in which to raise his three children”. When, as it did from time to time, the Ambulance Service advertised a position at Corrimal, the applicant successfully applied for the position. As an existing employee of the Ambulance Service, he was entitled to financial assistance and paid leave to assist with his relocation.

1. In Mr Sheppard’s case, the employer initiated the relocation. Mr Sheppard’s evidence is that on 23 May 2006, he was approached by his supervisor, Michael Cook, who told him (statement dated 12 September 2006):

“he wanted me to move back to Sydney and work out of the branch office at Blacktown. The reason for the move was to meet operational requirements within the Sydney area for the certification of speed cameras.”

1. In his statement dated 8 January 2007, Mr Cook, who is a Calibration and Certification Supervisor with the RTA, stated:

“4. In 2006, our division became busier in Sydney due to the increased installation of cameras and certification work. As a result I needed to become more office based and about this time the camera installations on the South Coast around Wollongong were becoming more network based. It was decided to reduce staffing in the Wollongong/Nowra localities, the work of which could be off-loaded to regular contractors.

5. The worker was at that time residing in the Nowra locality and carrying out duties in the Southern Region. I telephoned him and offered him employment in Sydney, operating from our Blacktown office. The worker agreed to be redeployed as he has children on the North Coast and he would be closer when visiting them.”

1. As I stated above, unlike in Klevjer, the evidence here is clear that the relocation was expressly induced by the employer for operational reasons – it was “brought about by the needs of the employment” (Burke J, quoted in paragraph 15, above). I agree with Mr Sheppard’s solicitors that the fact that the relocation was convenient for Mr Sheppard is immaterial. As a permanent employee of the RTA, Mr Sheppard was entitled to relocation expenses and paid leave. He was granted three days paid leave for the purpose of the move, but the work involved in moving extended beyond those three days into the following weekend. This work included not only unpacking his belongings at the newly rented Picton house, but also moving his motorbike, for which there had not been room on the removals truck. In my view, it is foreseeable that an employee moving in such circumstances would not complete the necessary relocation work during the period of paid leave and that work might extend into the weekend following. It is also foreseeable that an employee’s belongings involved in a relocation could include motor vehicles or motorbikes.

1. In my view, the sequence of events that led to Mr Sheppard being injured is causally connected to the relocation which was induced by the RTA. Thus, those events should be treated as arising out of his employment – they would not have occurred if the RTA had not asked Mr Sheppard to relocate to the Blacktown office.

1. Relying on the authority of Mercer, at paragraph 34 (Mason P), the RTA submitted that establishing that the injury arose out of employment required surmounting a higher barrier that that of the requirement for employment to be a substantial contributing factor to the injury. Mr Sheppard has surmounted this barrier and I am not satisfied by the RTA’s submissions that the Arbitrator made any error of law in finding that Mr Sheppard’s employment was a substantial contributing factor to his injury. Indeed, I am satisfied that Mr Sheppard’s employment was a substantial contributing factor to his injury.

1. In conclusion, the RTA having failed to establish their grounds of appeal, the Arbitrator’s decision must be confirmed.

DECISION

1. The decision of the Arbitrator dated 9 March 2007 is confirmed.

COSTS

1. The Appellant is to pay the Respondent, Mr Sheppard’s costs of this appeal.

Robin Handley

Acting Deputy President  

27 June 2007

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE