Scharrer v The Redrock Co Pty Ltd - [2010] NSWCA 365

No judgment structure available for this case.

New South Wales

Court of Appeal

CITATION: Scharrer v The Redrock Co Pty Ltd [2010] NSWCA 365

HEARING DATE(S): 24 June 2010

JUDGMENT DATE:
20 December 2010

JUDGMENT OF: McColl JA at 1; Basten JA at 106; Handley AJA at 188

DECISION: Appeal dismissed with costs.
[The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

CATCHWORDS: APPEAL – civil – statutory appeal – whether appellant aggrieved by decision of Deputy President on point of law – s 353, Workplace Injury Management and Workers Compensation Act 1998 (NSW) - WORKERS COMPENSATION – whether injury sustained "in the course of employment" – conduct of worker – vehicle provided by employer – employee injured driving home from employer's Christmas party – employee driving in contravention of orders given by employer and under the influence of alcohol – s 14(1), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION –"arising out of or in the course of employment" – s 4, s 14(2), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION – conduct of worker – whether employee's actions "for the purposes of and in connection with the employer's trade or business" – s 14(1), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION – whether employment a substantial contributing factor to the injury – s 9A, Workers Compensation Act 1987 (NSW) - WORDS AND PHRASES – "in the course of employment", "for the purposes of and in connection with the employer's trade or business"

LEGISLATION CITED: Coal Mines Act 1911 (UK)
Commonwealth Employees’ Compensation Act 1930 (Cth)
Interpretation Act 1987 (NSW)
Road Transport (Safety and Traffic Management) Act 1999 (NSW)
Social Security Contributions and Benefits Act 1992 (UK)
Workmen’s Compensation Act 1910 (NSW)
Workmen’s Compensation Act 1916 (NSW)
Workers’ Compensation Act 1926 (NSW)
Workers’ Compensation (Amendment) Act 1929 (NSW)
Workers’ Compensation Act and Workmen’s Compensation (Broken Hill) Act (Amendment) Act 1942 (NSW)
Workers' Compensation Act 1987 (NSW)
Workers’ Compensation Act 1949 (NT)
Workers’ Compensation Act 1916 (Qld)
Workmen’s Compensation Act, 1897 [60 & 61 Vict, Ch 37]
Workmen’s Compensation Act 1906 (Imp)
Workmen’s Compensation Act 1923 (Imp)
Workmen’s Compensation Act 1925 (Imp)
Workplace Injury Management and Workers Compensation Act 1998 (NSW)

CATEGORY: Principal judgment

CASES CITED: A G Moore & Co v Donnelly; Fife Coal Co Ltd v Sharp; Fife Coal Co Ltd v Fyfe [1921] 1 AC 329
Allianz Australia Insurance Ltd v GSF Australia Pty Ltd [2005] HCA 26; (2005) 221 CLR 568
Badawi v Nexon Asia Pacific Pty Ltd [2009] NSWCA 324; (2009) 75 NSWLR 503
Bill Williams Pty Ltd v Williams [1972] HCA 23; (1972) 126 CLR 146
Bourton v Beauchamp [1920] AC 1001
Clyde v State of New South Wales (TAFE Commission) [1995] NSWCC 38; 12 NSWCCR 541
Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; 92 CLR 390
Da Ros v Qantas Airways Ltd [2010] NSWCA 89
Gibb v The Commissioner of Taxation of the Commonwealth of Australia [1966] HCA 74; (1966) 118 CLR 628
Harris v Associated Portland Cement Manufacturers Ltd [1939] AC 71
Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473
Henderson v Commissioner for Railways (Western Australia) [1937] HCA 67; (1937) 58 CLR 281
Higgins v Galibal Pty Ltd t/as Hotel Nikko Darling Harbour (1998) 45 NSWLR 45
K&S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd [1985] HCA 48; 157 CLR 309
Kavanagh v The Commonwealth [1960] HCA 25; (1960) 103 CLR 547
Kennedy Cleaning Services Pty Ltd v Petkoska [2000] HCA 45; (2000) 200 CLR 286
Kuru v State of New South Wales [2008] HCA 26; (2008) 236 CLR 1
Love v Lysaghts Works Pty Ltd [1957] SR (NSW) 70
Minchinton v Homfray (1994) 10 NSWCCR 778
Noble v Southern Railway Co [1940] AC 583
Ogden Industries Pty Limited v Nash [1970] AC 113
Pollock v Stickfast Labels Pty Ltd (in Liq) [2002] NSWCA 360; (2002) 24 NSWCCR 279
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
Scharrer v The Red Rock Company Pty Ltd [2009] NSWWCCPD 73
Slazengers (Australia) Pty Ltd v Burnett [1951] AC 13
Smith v Australian Woollen Mills Ltd [1933] HCA 60; 50 CLR 504
Smith v Brown (1998) 16 NSWCCR 492
South Maitland Railways Pty Ltd v James [1943] HCA 5; (1943) 67 CLR 496
Stojkovic v Telford Management Pty Ltd [1998] NSWCC 8; 16 NSWCCR 165
Thomas v Ocean Coal Co Ltd [1933] AC 100
Tiver Constructions Pty Limited v Clair (1992) 110 FLR 239
Tompsett v Southern Portland Cement Ltd (1941) 41 SR (NSW) 126
Vetter v Lake Macquarie City Council [2001] HCA 12; (2001) 202 CLR 439
Wade v Burns [1966] HCA 35; 115 CLR 537
Watson v Qantas Airways Ltd [2009] NSWCA 322; (2009) 75 NSWLR 539
Webb v The Commissioner for Railways (NSW) [1938] HCA 24; 59 CLR 593
Wheeler v Commissioner for Railways [1969] 2 NSWR 474
Wilson v Wilson’s Tile Works Pty Ltd [1960] HCA 63; 104 CLR 328
Wilsons & Clyde Coal Co Ltd v M'Ferrin; Kerr v James Dunlop & Co Ltd [1926] AC 377
WorkCover Authority of NSW v Walsh [2004] NSWCA 186
Zickar v MGH Plastic Industries Pty Ltd [1996] HCA 31; (1996) 187 CLR 310

TEXTS CITED: T Blundell (ed), LexisNexis Butterworths, Mills Workers Compensation New South Wales, vol 1 (at release 121)
R Lewis, “Accidents Whilst Travelling and the Limits of Compensation for Industrial Injury” (1986) J Soc Welfare L 193
CP Mills, Workers Compensation (New South Wales), 2nd ed (1979) Butterworths
Pearce and Geddes, Statutory Interpretation in Australia (6th ed, 2006)
Willis and Everett, Willis’s Workmen’s Compensation, 36th ed (1944) Butterworth

PARTIES: Camilla Roslyn Scharrer - Appellant
The Redrock Co Pty Ltd - Respondent

FILE NUMBER(S): CA 2009/298404

COUNSEL: JB Simpkins SC with CA Goodman for the Appellant
SG Campbell SC with IA Todd for the Respondent

SOLICITORS: Lucas & Staggs Lawyers - Appellant
Turks Legal - Respondent

LOWER COURT JURISDICTION: Workers Compensation Commission

LOWER COURT FILE NUMBER(S): A2-006788 of 2008

LOWER COURT JUDICIAL OFFICER: O'Grady DP

LOWER COURT DATE OF DECISION: 1 July 2009

LOWER COURT MEDIUM NEUTRAL CITATION: [2009] NSWWCCPD 72

2009/298404

McColl JA
Basten JA
Handley AJA
20 December 2010

Scharrer v The RedRock Co Pty Ltd

Headnote

[This headnote is not to be read as part of the judgment]

Ms Camilla Scharrer, the appellant, suffered serious and permanent disablement as a result of an injury incurred when she crashed her employer’s motor vehicle in the early hours of 15 December 2001 following a night spent by the appellant at her employer’s Christmas party. It was not in dispute that the appellant's attendance at the Christmas party was “in the course of” her employment. She attended the Christmas party at 7pm on the evening of 14 December 2001 and left the party at 2am the following morning. One hour later, at 3am, she lost control of her car and collided with a rock wall on the side of Epping Road. She was thrown from the car and suffered serious injury.

On testing after the crash, the appellant returned a blood alcohol reading of 0.124. She was, accordingly, and it was so found in the Workers Compensation Commission of New South Wales (the “Commission”), prima facie driving in contravention of the Road Transport (Safety and Traffic Management) Act 1999 (NSW) (the “Safety and Traffic Management Act”). It was also found in the Commission that in driving the motor vehicle after the Christmas party, the appellant was disobeying an order or direction of the respondent given during the event not to drive “in her then present state”. It was common ground before the Commission that in so driving, the appellant was acting in a manner referred to in s 14(1)(a) and (b) of the Workers Compensation Act 1987 (NSW) ("the Act").

The appellant claimed weekly compensation benefits, which were paid by the respondent's insurer until July 2005. A dispute then arose concerning the appellant’s ongoing entitlement, which was the subject of a determination in the Workers Compensation Commission issued on 4 March 2009 by an Arbitrator in favour of the appellant. The employer successfully appealed to the Deputy President of the Commission on two bases: (a) that her injury did not arise "in the course of her employment" and (b) that if the claim were properly understood to be a journey claim, compensation was not payable because of s 10(1A) and (1B) of the Act.

The issues for determination on appeal were:

(i) Whether it was open to the Deputy President to conclude that the appellant was no longer in the course of her employment at the time of the accident.

(ii) If the reason the appellant was no longer in the course of her employment was that her blood alcohol reading was above the -prescribed maximum and/or that she disobeyed her employer’s direction not to drive, whether the appellant was nevertheless entitled to compensation pursuant to either s 14(1) or s 14(2) of the Act.

(iii) whether the Deputy President erred in holding that the appellant’s employment with the respondent was not a substantial contributing factor to the injury sustained by the appellant within the meaning of s 9A of the 1987 Act in that he (a) misdirected himself and/or (b) failed to take material evidence into account.

Held, per Basten JA, Handley AJA substantially agreeing, dismissing the appeal:

In relation to (i)

1 The Deputy President concluded that the appellant was entitled to succeed if she established that it was her intention to travel home when she left the party. That approach was based on the assumption that travel from the last place at which the appellant was present in the course of employment for the day, to her home, fell within the course of her employment, merely because she was provided by her employer with a vehicle. It is by no means clear why driving home in a company car should form the basis of an entitlement to compensation in the event of injury, absent a claim under s 10, relating to "journey claims". However, because of the limited right to appeal and the manner in which the appeal was conducted, the assumption of the Deputy President must be accepted: [125], [172].

2 The Deputy President held that use of the employer’s vehicle for personal purposes, followed by a trip home, even on a work day, did not necessarily arise out of or occur in the course of employment and had not been shown to do so in the present case. The approach adopted by the Deputy President was undoubtedly open to him: [173].

3 The appellant's argument based on Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; 173 CLR 473 was misconceived. While the appellant's employer provided her with a car, and "authorised, encouraged or permitted" her to use the vehicle to drive home after work, the Deputy President held that the relevant episode of work concluded when the appellant left the party, as the appellant failed to establish that she commenced a trip from the party to her home when she left the party. Unlike Hatzimanolis, this was not a case where the worker was living away from home so as to permit the conclusion that the overall period or episode of work extended beyond the hours required in a particular day: [177]-[180].

Hatzimanolis v ANI Corporation Ltd

In relation to (ii)

4 The proper construction of s 14 of the Act and its inter-relationship with ss 4 and 9, cannot properly be understood without reference to the statutory history: [131]-[168].

5 Section 14(1) would be internally incoherent if the matters which were to be disregarded, such as the appellant's blood alcohol reading resulting in the appellant driving in contravention of orders given by her employer, led to the conclusion that the act was not done by the worker "for the purposes of and in connection with the employer's trade or business". The test in s 14(1) was avoided disobedience to instructions or statutory regulation causing the act of the worker to fall outside the course of his or her employment. However, this was not a case where the appellant could succeed under s 14(1). Having concluded that the appellant had left the party to follow some personal pursuit, it could not be said that at the time of the accident the appellant's act of driving was being done for the purpose of and in connection with the employer's business: [182]-[183].

6 Because s 14(2) operated as a qualification in respect of serious and wilful misconduct only where the course of employment test was otherwise satisfied, that provision was of no assistance to the appellant. The inference that the appellant was driving home was established, however the inference that the appellant was coming from a place of employment was not, given the significant lapse of time, unexplained, between leaving the party and the accident. The conclusion of the Deputy President in this respect did not involve an erroneous decision in point of law: [175]-[176].

In relation to (iii)

7 It is not necessary to address the requirement of s 9A of the Act that the employment was a substantial contributing factor to the injury: [124].

Held, per McColl JA, dissenting:

In relation to (i):

8 In determining whether a worker who was injured at a time when s/he was acting in one of the manners proscribed by s 14(1)(a) and/or (b) was nevertheless injured within the meaning of s 4 and s 9, the tribunal of fact must consider whether the worker’s injury arose out of or in the course of employment. If the only reason for concluding it did not was because the worker was acting in one of the manners proscribed by s 14(1)(a) and/or (b), then the worker may receive compensation, subject to satisfying the subordinate clause of s 14(1), that is, “if the act was done by the worker for the purposes of and in connection with the employer’s trade or business”: (at [85])

Tompsett v Southern Portland Cement Ltd (1941) 41 SR (NSW) 126; Love v Lysaghts Works Pty Ltd [1957] SR (NSW) 70; Wheeler v Commissioner for Railways [1969] 2 NSWR 474 applied

Higgins v Galibal Pty Ltd

9 The Deputy President erred in law in concluding that the appellant was not injured in the course of her employment in that the sole reason he reached that decision was because of her s 14(1)(a) and (b) contraventions: (at [87]).

In relation to (ii):

10 Determination of the question whether the act was done by the worker for the purposes of and in connection with the employer’s trade or business for the purposes of s 14(1) requires consideration of the activity in which the appellant was engaged when she was injured. The act would satisfy that requirement unless the respondent demonstrated that she acted for a reason entirely unconnected with the contraventions. On the facts as found the appellant was injured in the course of her employment and, accordingly, was entitled to receive compensation: (at [90], [95])

Tompsett v Southern Portland Cement Ltd

Love v Lysaghts Works Pty Ltd

As to (iii)

11 The Deputy President erred in law in not concluding that the contribution of the appellant’s employment was “real or of substance” to her injury in that he focused on what the appellant was doing at the time the injury occurred, rather than having regard to the matters set out in s 9A(2)

Orders

**********

2009/298404

McColl JA
Basten JA
Handley AJA

20 December 2010

Scharrer v The RedRock Co Pty Ltd

Judgment

1 McColl JA: Camilla Scharrer, the appellant, was seriously injured on 15 December 2001 in a single car crash which occurred at 3am on Epping Highway, Marsfield after she had attended a Christmas party her employer, the respondent, The RedRock Co Pty Ltd, arranged for staff members. The party was held after work at a bar in Sussex Street, Sydney. The respondent conceded that the appellant’s attendance at the Christmas party was in the course of her employment.

2 The respondent employed the appellant as a sales representative in its wholesale beverage business. Most of her duties were performed “on the road” attending to the promotion and sale of the respondent’s products to customers in metropolitan Sydney. The respondent supplied a motor vehicle to her for this purpose. She was entitled to retain possession of the motor vehicle outside working hours and to use it for personal transport. The appellant was also required to attend the respondent’s premises in Millers Point, Sydney for two days a week to attend to clerical matters, attend meetings and stock her vehicle.

3 The appellant was driving the motor vehicle after the Christmas party at the time of the crash. There was a male companion in the motor vehicle. Both were ejected from the motor vehicle when it crashed. The appellant suffered serious injuries which it was common ground on appeal constituted “serious and permanent disablement” for the purposes of s 14 of the Workers Compensation Act 1987 (NSW) (the “1987 Act”).

4 On testing after the crash, the appellant returned a blood alcohol reading of 0.124. She was, accordingly, and it was so found in the Workers Compensation Commission of New South Wales (the “Commission”), prima facie driving in contravention of the Road Transport (Safety and Traffic Management) Act 1999 (NSW) (the “Safety and Traffic Management Act”). It was also found in the Commission that in driving the motor vehicle after the Christmas party, the appellant was disobeying an order or direction of the respondent given during the event not to drive “in her then present state”. The appellant does not challenge either of those findings which I will refer to as the “contraventions”.

5 As Basten JA has explained, the respondent’s workers compensation insurer paid compensation to the appellant for a number of years, but declined liability in 2005. As a result the appellant filed an Application to Resolve a Dispute (the “Application”) in the Commission. An Arbitrator, Mr M Oldfield, determined the application in the appellant’s favour. The respondent sought a review of that decision pursuant to s 352 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the “WIM Act”). Deputy President O’Grady revoked the Arbitrator’s decision and entered an award for the respondent: The RedRock Company Pty Ltd v Scharrer [2009] NSWWCCPD 72.

6 The appellant appeals from the Deputy President’s decision. On appeal the appellant must establish that she is aggrieved by a decision of the Presidential member in point of law: s 353, WIM Act.

7 Three issues arise on the appeal. First, whether the Deputy President misdirected himself in holding that the appellant did not suffer injury arising in the course of her employment with the respondent. Secondly, whether the Deputy President misdirected himself in relation to s 14 of the 1987 Act. Thirdly, whether the Deputy President erred in holding that the appellant’s employment with the respondent was not a substantial contributing factor to the injury sustained by the appellant within the meaning of s 9A of the 1987 Act in that he (a) misdirected himself and/or (b) failed to take material evidence into account.

8 As Basten JA has also explained (at [127]), the appeal was conducted on the basis that the appellant could succeed either on the basis of s 14(1) or s 14(2). The respondent did not oppose that approach, notwithstanding the fact the appellant’s written submissions only addressed s 14(2), no doubt because the case was conducted in the Commission on both bases.

9 It should be noted that the appellant sought a review of the Arbitrator’s quantification of her entitlement to weekly benefits and his alleged failure to address a matter in dispute between the parties, the question whether her child was at all relevant times a dependant within the meaning of the 1987 Act. In the light of his determination adverse to her in the matter the subject of the present appeal, the Deputy President refused leave to proceed with that appeal. However he expressed the tentative view that it was arguable that the Arbitrator had erred concerning the application of s 40 of the 1987 Act and had failed to make any findings in relation to the dependency issue. He wisely foreshadowed those observations in the event that he might be found to have been in error in his findings on the respondent’s appeal, flagging that in that event the weekly entitlement and dependency issues would require review: Scharrer v The Red Rock Company Pty Ltd [2009] NSWWCCPD 73.

10 As will become apparent from these reasons, I am of the view that the appellant’s appeal should be allowed and the decision of the Arbitrator confirmed, subject to the issues the Deputy President flagged. It is appropriate, accordingly, that the matter be remitted to the Commission to determine that outstanding application for leave to appeal from the Arbitrator’s decision.

Legislative framework

11 The 1987 Act relevantly provides:

“ 4 Definition of ‘injury’

In this Act:

injury :

9 Liability of employers for injuries received by workers—general

(2) Compensation is payable whether the injury was received by the worker at or away from the worker’s place of employment.

9A No compensation payable unless employment substantial contributing factor to injury

(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury.

(2) The following are examples of matters to be taken into account for the purposes of determining whether a worker’s employment was a substantial contributing factor to an injury (but this subsection does not limit the kinds of matters that can be taken into account for the purposes of such a determination):

(b) the nature of the work performed and the particular tasks of that work,

(c) the duration of the employment,

(d) the probability that the injury or a similar injury would have happened anyway, at about the same time or at the same stage of the worker’s life, if he or she had not been at work or had not worked in that employment,

(e) the worker’s state of health before the injury and the existence of any hereditary risks,

(f) the worker’s lifestyle and his or her activities outside the workplace.

(b) the worker’s incapacity for work, loss as referred to in Division 4 of Part 3, need for medical or related treatment, hospital treatment, ambulance service or occupational rehabilitation service as referred to in Division 3 of Part 3, or the worker’s death, resulted from the injury.

14 Conduct of worker etc

(1) Compensation is payable in respect of any injury resulting in the death or serious and permanent disablement of a worker, notwithstanding that the worker was, at the time when the injury was received:

(b) acting without instructions from the worker’s employer,

if the act was done by the worker for the purposes of and in connection with the employer’s trade or business.

I will refer to the words “if the act was done by the worker for the purposes of and in connection with the employer’s trade or business” in s 14(1) as the “subordinate clause”.

Statement of the case

12 The appellant put her case in the Commission on alternative bases. Either she was entitled to compensation because she was injured during a journey within the meaning of s 10 of the 1987 Act or, she was entitled to compensation because she suffered injury in the course of her employment (s 9), that her employment was a substantial contributing factor to her injury (s 9A) and that, by virtue of either s 14(1) or s 14(2) of the 1987 Act, her contraventions did not preclude her from recovering compensation

13 The appellant failed on the s 10 claim both before the Arbitrator and the Deputy President for different reasons. The Arbitrator held (at [9.8]) she was injured in the course of her employment and hence s 10 was not applicable. The Deputy President held (at [115] – [117]) that notwithstanding that the accident occurred whilst the appellant was on a journey within the meaning of s 10, recovery of compensation pursuant to that provision was precluded because, by virtue of the combined operation of s 10(1A) and s 10(1B), her injury was attributable to her serious and wilful misconduct. Those provisions, in substance, relevantly preclude recovery of compensation by a worker injured on a journey within the meaning of s 10(3) if the injury was attributable to the worker being under the influence of alcohol within the meaning of the Safety and Traffic Management Act, unless the alcohol did not contribute in any way to the injury.

14 The appellant does not seek to pursue the s 10 claim on appeal, however she points to a finding of fact the Deputy President made when considering this aspect of her claim as relevant to the question whether she was injured in the course of her employment. That finding was:

I accept the worker’s submission that the appellant has at no time disputed that she at the relevant time was journeying to her home at Beecroft.

Notwithstanding this time interval the appellant has not raised any issue concerning an alleged interruption or deviation on the subject journey which may have been argued having regard to the terms of section 10(2)

I shall return to the significance of this finding.

The Arbitrator’s findings

15 It is necessary to refer to some of the Arbitrator’s findings to illuminate the Deputy President’s reasons.

16 The appellant succeeded before the Arbitrator on the basis of s 14(1). In short, he found (at [9.4], [9.6], [9.7]) that the appellant was employed “on the basis of being provided with an all purpose vehicle to enable [her] to efficiently and effectively service [her] employer’s customers or clients by proceeding immediately from … home to wherever” she carried out her duties and did not cease being in the course of her employment until she arrived home at the end of her working period. On that analysis, he concluded (at [9.7]):

“I therefore find that Ms Scharrer was in the course of her employment when she was injured being satisfied, from the site of the accident in comparison to where her abode in Beecroft was, that she was returning home after a day doing what she was expected and authorized to do (on the road servicing customers) and following attendance upon the Christmas Party organized and paid for by the Respondent all of which was conceded was in the course of her employment. She was injured before she got back to her abode so therefore the car trip, on my reasoning, was also in the course of her employment.”

17 The Arbitrator also concluded (at [9.8]) that s 9A was satisfied because at the time she was injured the appellant “was doing something her contract of employment authorized and expected her to do.”

18 The Arbitrator then turned to s 14. I interpolate at this stage to observe that he had earlier in his reasons concluded (at [8.20]) that s 14(2) was not applicable because, even though the appellant suffered injury due to her serious and wilful misconduct of driving over the legal blood alcohol limit, the evidence did not establish that her injury was “solely attributable” to that misconduct.

19 Subsequently, in the section of his reasons identified as “Findings” the Arbitrator set out s 14(1) and s 14(2). He then said (at [9.9]) that “[t]o ascertain whether this section applies to deny Ms Scharrer compensation it firstly has to be determined whether Ms Scharrer’s conduct at the time of injury was serious and wilful misconduct or whether her conduct was in contravention of any statute or proper instructions from the employer.” While it appears from that statement that the Arbitrator was conflating sub-sections (1) and (2) of s 14, I infer from the fact he had already disposed of s 14(2) (albeit only on the basis of serious and wilful misconduct arising from the blood alcohol reading) that he was only intending to address s 14(1).

20 The Arbitrator then concluded (at [9.10]) that the evidence of the appellant’s alcohol consumption at the party and her blood alcohol reading after the accident was prima facie evidence that she was driving whilst in contravention of the Safety and Traffic Management Act and also that she was in contravention of the respondent’s orders not to drive home after the party. The Arbitrator said that, notwithstanding that finding, the appellant was entitled to compensation if she had suffered serious and permanent disablement as a result of her injuries (at [9.11]). He determined that issue in the appellant’s favour (at [9.20]). As is apparent from this conclusion, the Arbitrator regarded the appellant’s contravention of the Safety and Traffic Management Act as falling within s 14(1)(a) – a conclusion adopted by the Deputy President. There was no challenge to this approach in this Court.

21 The Arbitrator proceeded to the step of determining whether the appellant had suffered serious and permanent disablement without considering the subordinate clause of s 14(1).

The primary judgment

22 The appeal to the Deputy President was, as I have said, by way of review pursuant to s 352 of the WIM Act. The Deputy President concluded (at [85]) that the Arbitrator had failed to give sufficient reasons for what he described as the Arbitrator’s “ultimate conclusion” (referring to [9.7]) of the Arbitrator’s reasons – that the appellant was injured in the course of her employment. Accordingly he considered the evidence required reviewing to determine whether the Arbitrator’s decision was correct.

23 The Deputy President noted (at [86]) that it was “common ground” between the parties that the appellant was provided with a motor vehicle for use in the course of her employment and she was permitted to retain possession of that vehicle (upon terms which were not elucidated in evidence) in her off-duty time for personal use. His Honour then observed:

she would remain in the course of her employment within the meaning of section 4 from the time that she left her home at Beecroft in that vehicle until her return

24 The Deputy President (at [87]) adopted the Arbitrator’s findings that at the time of the accident, the appellant was in control of the vehicle with a blood alcohol reading of 0.124, in excess of the legal limit of 0.05 and that “in driving the car [she] was disobeying an order or direction of her employer.”

25 The Deputy President expressed his conclusion that the appellant was not injured in the course of her employment in several places in his reasons: see [91], [96] - [97], [101] - [103]. The essential reasons for that conclusion appeared at [91] (and were repeated in substance in the other passages to which I have referred) as follows:

91 … The worker in this matter was in the course of her employment certainly up until she left the staff party. Beyond that point she was entitled to the benefit of the provisions of the Acts if it be established that it was her intention to travel home. … It is common ground that upon leaving the party the worker got into the vehicle and proceeded to drive. Accepting for the moment that it was the worker’s intention to drive home it is my view that her disobedience of her employer’s directions concerning driving and her decision to drive whilst having the blood alcohol concentration as noted was conduct that prevents the characterisation of her subsequent conduct up until the point of impact and injury as being in the course of employment within the meaning of section 4 of the 1987 Act. On the present facts the question is not whether the conduct I have highlighted took the worker outside her employment but whether by reason of her conduct she was not nor was she ever at any relevant time in the course of her employment. In my view, as stated, the worker was not in the course of her employment once she elected to drive off in the staff motor vehicle.”

26 The Deputy President rejected the appellant’s submission that, should her conduct be characterised as “serious and wilful misconduct”, that conduct could not have the effect of taking her outside the course of her employment at the relevant time, because that would render s 14 futile, saying (at [93]):

WorkCover Authority of

NSW v Walsh

27 After referring (at [94] - [96]) to Pollock v Stickfast Labels Pty Ltd (in Liq) [2002] NSWCA 360; (2002) 24 NSWCCR 279 (worker who injected heroin not injured in course of employment), and WorkCover Authority of NSW v Walsh [2004] NSWCA 186 (truck driver who ingested methamphetamine to stay awake injured in course of employment) and to the “classical test to determine whether an injury arises in the course of employment” enunciated by Dixon J in Henderson v Commissioner for Railways (Western Australia) [1937] HCA 67; (1937) 58 CLR 281 (at 294), the Deputy President said (at [96]):

28 The Deputy President (at [101]) distinguished Priestley JA’s analysis of s 14(2) in Higgins v Galibal Pty Ltd t/as Hotel Nikko Darling Harbour (1998) 45 NSWLR 45 (Stein JA agreeing) on the basis that his Honour had ultimately concluded the worker was in the course of his employment when the accident occurred. In contrast, in this case “the worker…failed to establish she was in the course of employment during the one hour period between leaving the party and the occurrence of injury.”

29 That finding was, in the Deputy President’s view (at [103] - [104]) sufficient to conclude that the Arbitrator had erred in reaching the contrary conclusion and, rather, that the appellant was precluded from receiving compensation. However, he went on to consider s 14 in case his primary ruling was wrong, and, in due course s 9A.

30 Insofar as s 14 was concerned, he said:

the worker may not place reliance on the provisions of section 14(1) given that it could not be said that the act of driving and her disobedience of the direction not to drive could be perceived as having been done by the worker for the purposes of and in connection with the employer’s trade or business.

106 With respect to section 14(2) the onus is upon the appellant to establish that the subject injury was ‘solely attributable’ to the serious and wilful misconduct of the worker. Having regard to the state of the evidence there is, in my view, nothing to establish that the injury was solely attributable to the serious and wilful misconduct of the worker as found by the Arbitrator. The onus of proof concerning ‘solely attributable’ is upon the appellant. The absence of evidence concerning attribution permits the worker to rely upon the provision. Leaving aside consideration of the operation of section 9A, the worker would be entitled to the benefit of section 14(2).” (emphasis added)

31 It is, with respect, difficult to understand the passage emphasised in [106]. As I have said, the Arbitrator concluded the evidence did not entitle him to determine the issue whether the injury was “solely attributable” to the appellant’s serious and wilful misconduct.

32 The Deputy President disposed of s 9A succinctly, noting (at [107]) that the question as to whether employment is a substantial contributing factor to injury is one of fact. He observed, by reference to s 9A(3)(a), that the mere fact that an injury arises in the course of employment is not sufficient to establish the matters raised for consideration by section 9A, then said:

33 The Deputy President then considered the s 10 issue. He noted (at [114]) that the respondent “at no time disputed that [the appellant] at the relevant time was journeying to her home at Beecroft” and also had not raised any issue regarding the disjuncture between the appellant’s evidence as to the usual travel time from Sydney to Beecroft (30 minutes), and the elapse of one hour between her departure from the party and the accident. However, as I have said, he concluded that s 10(1A) and (1B) precluded her from recovering compensation.

Appellant’s submissions

34 Mr J Simpkins of Senior Counsel, who appeared with Ms C Goodman for the appellant, submitted that the Deputy President erred in the approach he adopted to analysing the question whether the appellant was injured in the course of her employment. He submitted that the Deputy President ought first to have determined what the appellant’s ordinary period of employment was in accordance with Watson v Qantas Airways Ltd [2009] NSWCA 322; (2009) 75 NSWLR 539. Had the Deputy President done so, Mr Simpkins contended, he would have concluded that the period of the appellant’s employment was, as the Arbitrator found, from when she left home in the morning to when she returned.

35 Mr Simpkins argued that sub-s 14(1) and sub-s 14(2) operated disjunctively and that the appellant could succeed if she only satisfied the former sub-section.

36 Next, Mr Simpkins submitted, the Deputy President was required to determine the effect of the appellant driving home after the party in contravention of the respondent’s orders and in contravention of the Safety and Traffic Management Act on whether her injury satisfied the definition. He argued that if she was not so injured it was only because her contraventions (whether they were within s 14(1) or s 14(2)) constituted “serious and wilful misconduct”, that result was avoided either by the operation of s 14(1) or s 14(2).

37 Insofar as s 14(1) was concerned, Mr Simpkins contended that whatever the subordinate clause meant, the appellant could not fail to satisfy it merely because of conduct falling within s 14(1)(a).

38 Insofar as s 14(2) was concerned, Mr Simpkins relied upon the Deputy President’s finding (at [106]) that were it not for s 9A, the appellant would be entitled to the benefit of that section.

39 As to s 9A, Mr Simpkins submitted that the Deputy President erred when determining that issue by focusing on the immediate activity in which the appellant was engaged rather than the connection of that injury with her employment. He submitted that the fact that the appellant’s injury was suffered while she was in the course of employment prima facie established that her employment was a substantial contributing factor within the meaning of s 9A.

Respondent’s submissions

40 Mr S G Campbell of Senior Counsel, who appeared with Mr I Todd for the respondent, submitted that the appellant’s case foundered at the outset because she could not establish she had suffered an injury as defined by s 4. He argued that the appellant’s decision to drive home in contravention of the respondent’s orders was, in substance, an act so repugnant to her employment, that it could not be said her injury arose from, or occurred in the course of, her employment. He argued that the Deputy President’s finding that the appellant was not in the course of her employment was a finding of fact which was not within the permissible grounds of review open to this Court pursuant to s 353 of the WIM Act.

41 Mr Campbell did not challenge Mr Simpkins’ submission that sub-s 14(1) and sub-s 14(2) operate disjunctively. Rather, he submitted that the consequence of the Deputy President’s finding that the appellant was not injured in the circumstances prescribed by s 4 meant, as the Deputy President concluded, that the question of the operation of s 14 and s 9A did not arise.

Consideration

42 A worker’s entitlement to compensation pursuant to the 1987 Act depends upon that person having “received an injury” (s 9), a term defined in s 4 as meaning “personal injury arising out of or in the course of employment”. The definition involves two quite different tests, one or other of which is sufficient to be satisfied for the purposes of s 9: Badawi v Nexon Asia Pacific Pty Ltd [2009] NSWCA 324; (2009) 75 NSWLR 503 (at [72]) per Allsop P, Beazley and McColl JJA.

43 The course of employment is ordinarily perceived as commencing when the employee starts work in accordance with his or her ordinary or overtime hours of work and as ending when the employee completes his or her ordinary or overtime hours of work: Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473.

44 Injury in the course of employment means an injury sustained while the worker is engaged in the work he or she is employed to do and is a concept devoid of any causal link between the work the worker is employed to do and the injury sustained: Kavanagh v The Commonwealth [1960] HCA 25; (1960) 103 CLR 547. It is a temporal concept, but the relevant time span during which the course of employment runs is determined by the activities of the worker. The time span endures so long as he or she is engaged in his/her work or something incidental to it and ends when he or she ceases to be so engaged: Bill Williams Pty Ltd v Williams [1972] HCA 23; (1972) 126 CLR 146 (at 159) per Stephen J; see also Kavanagh (at 556) per Dixon CJ (“[course of employment] describe[s] a condition which is satisfied if the accident happens while the workman is doing something in the exercise of his functions although it is no more that an adjunct to or an incident of his service”). In contrast, the words “arising out of … employment” involve a causative element: Badawi (at [72] - [79]).

45 In determining whether an injury occurs in the course of employment, regard must always be had to the general nature, terms and circumstances of the employment “and not merely to the circumstances of the particular occasion out of which the injury to the employee has arisen”: Hatzimanolis (at 484) per Mason CJ, Deane, Dawson and McHugh JJ.

The interrelationship between s 9 and s 14 of the 1987 Act

46 Critical to the resolution of the appeal is the interrelationship between s 9 and s 14 of the 1987 Act. A textual examination reveals the problem of reading the definition of “injury” in s 4 into both. Does the fact that the appellant drove in defiance of the respondent’s orders and in contravention of the Safety and Traffic Management Act mean, as the Deputy President found, that she did not receive an “injury” within the meaning of s 9 because her injury did not arise out of or in the course of her employment (s 4)? Or, as the appellant contended was the effect of s 14 such that it qualified the word “injury” where it first appears in that section in a manner which detracts from its s 4 meaning so that the circumstances in which the appellant drove did not disentitle her to compensation? As the following discussion reveals, this is not a novel conundrum.

47 The conundrum was addressed by CP Mills in Workers Compensation (New South Wales), 2^nd ed (1979) Butterworths (at 214). Writing of s 7(2) of Workers’ Compensation Act 1926 (NSW) (the “1926 Act”) which, in substance, is the statutory predecessor of s 14(2) of the 1987 Act, Mills explained:

Slazenger (Aust) Pty Ltd v Burnett

48 Mills went on to explain how this conundrum had been dealt with in Love v Lysaghts Works Pty Ltd [1957] SR (NSW) 70 and Wheeler v Commissioner for Railways [1969] 2 NSWR 474 which I consider below.

49 Some general observations should be made before considering the history of s 4, s 9 and s 14.

50 The definition of “injury” in s 4 of the 1987 Act does not enact substantive law but, rather, indicates that when particular words or expressions the subject of the definition are found in a substantive part of the statute under consideration, they are to be understood in a defined sense – or are to be taken to include certain things which, but for the definition, they would not include: Gibb v The Commissioner of Taxation of the Commonwealth of Australia [1966] HCA 74; (1966) 118 CLR 628 (at 635) per Barwick CJ, McTiernan and Taylor JJ. As McHugh J explained in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd [2005] HCA 26; (2005) 221 CLR 568 (at [12]), the function of definitions in aiding the construction of substantive enactments depends on the context and object of the substantive enactment.

51 In Zickar v MGH Plastic Industries Pty Ltd [1996] HCA 31; (1996) 187 CLR 310 (at 328 - 329) Toohey, McHugh and Gummow JJ observed that it was “of some importance to note that the definition of ‘injury’ ” in the 1987 Act was in s 4 rather than “in the definition section” (s 3). The repositioning of the definition from where it had appeared in the general definition section (s 6) in the 1926 Act, in their Honours’ view, lent support to the argument that s 4 was “a new section, to be construed according to its terms.” Their Honours observed (at 329) that “[t]he layout of the definition in s 4, which differs from its predecessor, certainly suggests that the first inquiry is whether there has been personal injury, a term which itself is not defined and which therefore must be understood according to ordinary concepts.” I do not understand their Honours’ remarks to detract from the fundamental proposition that s 4 is a definition section and should be so understood, where appropriate, as explained in Gibb. Kirby J (who agreed in separate reasons with Toohey, McHugh and Gummow JJ that the appeal should be allowed) so approached s 4 in Zickar (at 345, 346). The issue in Zickar was whether a “disease” within the meaning of s 4(b) fell within the meaning of “personal injury” in s 4(a) and, accordingly, it was necessary to determine what that expression meant in the context of s 4. There is no controversy in this case that the appellant suffered personal injury of a serious and disabling nature.

52 I turn to a brief history of the legislative ancestry of the definition of “injury” and s 14(1) and s 14(2). Powell JA comprehensively set out the history of the statutory provisions upon which s 14 of the 1987 Act is based in Higgins (at 60 - 77), in terms referred to with approval by the High Court in Kennedy Cleaning Services Pty Ltd v Petkoska [2000] HCA 45; (2000) 200 CLR 286 (at [21]). I refer only to the critical historical developments.

53 Section 9 and s 14(1) and s 14(2) of the 1987 Act substantially reproduce, respectively, s 7(1)(a), s 7(2) and s 7(3)(b) of the 1926 Act. At the time of the repeal of the 1926 Act on the enactment of the 1987 Act, s 7 relevantly provided:

“ Liability of employers to workers for injuries

(3) Provided that—
(a) [Repealed].

(b) if it is proved that the injury to a worker is solely attributable to the serious and wilful misconduct of the worker, any compensation claimed in respect of that injury shall, unless the injury results in death or serious and permanent disablement, be disallowed;…”

54 As is clear from Powell JA’s analysis in Higgins (see 67), the genesis of s 7(2) and s 7(3)(b) of the 1926 Act lay in s 1(1)(b) and s 1(2) of the Workmen’s Compensation Act 1925 (Imp) (the “1925 UK Act”) which was intended to codify the law relating to workers compensation in the United Kingdom. His Honour referred with approval to Willis and Everett, Willis’s Workmen’s Compensation, 36^th ed (1944) Butterworth (at 80 - 81) which explained that it was the shot firing cases of Bourton v Beauchamp [1920] AC 1001 and A G Moore & Co v Donnelly; Fife Coal Co Ltd v Sharp; Fife Coal Co Ltd v Fyfe [1921] 1 AC 329 which probably led to the passing of s 1(2) of the 1925 UK Act.

55 The facts in the shot firing cases were essentially the same. In Bourton a miner, in contravention of statutory regulations made under the Coal Mines Act 1911 (UK) removed the stemming from a hole already drilled and stopped with stemming and the charred remains of a fuse. An explosion occurred which caused his death. His widow’s claim for compensation under the Workmen’s Compensation Act 1906 (Imp) was rejected because “it was held that the deceased, in disobeying the statutory regulations, was acting outside the sphere of his employment, and that consequently his death was not caused by an accident arising out of and in the course of his employment”: Higgins (at 68).

concerned three appeals brought by employers in respect of awards for compensation respectively made in favour of a worker and the relatives of two deceased workers, all of which workers had been employed as miners in coal mines. In the first two cases, a miner in the course of his employment fired a shot by means of a fuse and detonator and retired to a place of safety. The shot misfired. In contravention of a provision in the Explosives in Coal Mines Order made under the provisions of the Coal Mines Act, each worker returned to the place of the shot in less than an hour, and, when he did so, the shot blew up, in the first case permanently disabling the worker, and in the second case killing him. The third case also involved a miner entering a fenced off area signposted “No Road”, in contravention of two regulations, and being poisoned by noxious gases. In each case it was again held that the contravention of the relevant mining regulations took the miner outside the sphere of his employment and consequently the injury did not arise out of and in the course of his employment: Higgins (at 68).

57 Section 1 of the 1925 UK Act was originally enacted as s 7 of the Workmen’s Compensation Act 1923 (Imp) (the “1923 UK Act”). Section 7 provided:

a workman shall be deemed to arise out of and in the course of his employment,

58 The transformative effect of s 7 of the 1923 UK Act was immediately apparent. Powell JA discussed (at 69) the first cases under that provision, Wilsons & Clyde Coal Co Ltd v M'Ferrin; Kerr v James Dunlop & Co Ltd [1926] AC 377. The first concerned a shot firing incident the facts of which were substantially on all fours with those of Bourton and Moore. Notwithstanding the worker’s breach of the regulation, it was held that s 7 of the 1923 UK Act applied and that the accident must be deemed to arise out of and in the course of the employment. In the second case the worker was killed while carrying out a duty he was neither engaged, nor entitled, to perform in breach of a statutory mining regulation. The House of Lords held that s 7 of the 1923 UK Act did not apply to the case of a worker who arrogated to himself duties he was neither engaged nor entitled to perform, whether the act which caused the injury was the subject of a specific prohibition or not, and, accordingly, the accident did not arise out of his employment: Higgins (at 69)

59 In Thomas v Ocean Coal Co Ltd [1933] AC 100 (at 112) Lord Blanesburgh explained that s 7 of the 1923 UK Act “was designed to bring within the range of compensation certain classes of serious accident which had been excluded therefrom by the judicial interpretation placed upon s 1, sub-s (1)(b)” which, as Powell JA observed (Higgins, at 71) was “the source of s 7(3)(b) of the 1926 Act” – and, I add, s 14(2) of the 1987 Act.

60 In Noble v Southern Railway Co [1940] AC 583 (a case decided under s 1(2) of the 1925 UK Act) the House of Lords held that the widow of a deceased railway worker who had been walking along the railway lines in contravention of a rule made by his employer was entitled to workers compensation. As Jordan CJ explained in Tompsett v Southern Portland Cement Ltd (1941) 41 SR (NSW) 126 (at 131) the House of Lords’ approach in Noble was to determine whether, despite the worker’s express contravention of the rule (which was sufficient to prevent his act from being in the course of employment), his act would otherwise have been within the course of employment. It concluded it was. As there was nothing to show that the deceased had deviated from a safe route in order to fulfil any purpose of his own, and as he was still on the respondent’s premises and was going about his allotted job, the necessary inference was that he was walking along the line “for the purposes of and in connection with his employer's trade or business”: Higgins (at 73).

61 In New South Wales in 1929, the 1926 Act was amended so that, thenceforth, s 7(1) entitled “[a] worker who has received an injury whether at or away from his place of employment” to compensation, while s 7(2) substantially reproduced the deeming provision from s 1(2) of the 1925 UK Act save for the omission of the words “or of any orders given by or on behalf of his employer”: see Higgins (at 72).

62 As Powell JA explained (Higgins, at 73 – 75), in Tompsett the Full Court (Jordan CJ, Street and Roper JJ) considered the questions raised by s 7(1) and s 7(2) of the 1926 Act. At the time Tompsett was decided the definition of “injury” used the conjunction “and” where “or” now appears. After describing s 7(2) as having “a general resemblance” to s 1(2) of the 1925 UK Act and referring to Wilson & Clyde Coal Co v M'Ferrin and Noble, Jordan CJ said (at 130):

if, apart from some express or implied prohibition, the act which occasioned the injury would have been within the scope of the employment, and it is the prohibition which puts it outside the employment, nevertheless, in the cases and subject to the conditions specified, the injury is to be deemed to arise out of and in the course of the employment, notwithstanding the prohibition

Thomas v Ocean Coal Co

unless it is shown by the employer that, for some reason entirely unconnected with the breach of the regulation, etc, the injury was not sustained in the course of the employment:

Thomas v Ocean Coal Co

It does not touch the case where, irrespectively of any prohibition, the thing done would stand outside the scope of his employment

63 Section 7(2) of the 1926 Act was omitted in 1942 and a provision substantially in terms of s 14(1) of the 1987 Act inserted. This was a reversion to the form in which s 7(2) had been originally enacted in the 1926 Act. At the same time s 6 of the 1926 Act was amended to read, relevantly:

“ ‘Injury’ means personal injury arising out of or in the course of employment...”

64 The Full Court considered the interaction of s 7(1) and s 7(2) of the 1926 Act in Love. In that case, the worker, an electrician’s apprentice, lost four fingers on his left hand while operating a guillotine in his place of work. He was using the guillotine to fashion a knife for use in his work. He had been specifically instructed not to use that machine, and had notice of rules governing his employment that prohibited him from using such a machine.

65 The Commissioner, Judge Rainbow, had purported to apply s 7(2) of the 1926 Act to award compensation to the worker, despite finding that his injury was not received in the course of, and did not arise out of, his employment. The employer complained on the appeal that the finding the injury was not received in the course of the worker’s employment precluded an award of compensation.

66 Herron J said (at 74) that the case raised squarely the issue whether the word “injury”, where it appeared in s 7(2), must be read in accordance with the definition of that word in s 6. He observed (at 75) that the change from the 1929 version of s 7(2) (“deemed to arise”) to its 1942 manifestation was “a change in phraseology and was not intended to alter the basic application of the sub-section broadly interpreted.” Sugerman J observed (at 81) that he had been unable to discover any reason for the departure in the 1926 Act from the form of s 1(2) of the 1925 UK Act, for the change in 1929 to the English form, or for the 1942 reversion to the 1926 form of the provision. McClemens J expressed similar bemusement (at 89 - 90).

67 Herron J concluded (at 74) that the word “injury” in s 7(2) ought to be read in accordance with s 6, but that the word “notwithstanding” “import[ed] into [s 7(2)] a qualification that in a series of events there set out the worker is still entitled to compensation if the act causing the injury was done for the employer’s benefit.” In his Honour’s view (at 74 - 75), s 7(2) was intended to “lay down a rule having statutory force that in future such acts of a worker were not to deprive him of compensation if he came otherwise within the policy of the Act, as expressed … in s 7(1)(a)” which I note relevantly now finds expression in s 9 of the 1987 Act. His Honour (at 75) considered s 7(2) was “an extension of the rights of a worker granted by [s 7(1)(a)]”.

68 Applying this construction to the facts at hand, Herron J stated (at 75 - 76):

unless the finding was based solely upon the contravention by the worker of one of the terms of his employment

which are enumerated in sub-s (2) of s 7

Wilson, Thomas

Tompsett

69 Sugerman J (at 80) rejected the employer’s submission that the definition of “injury” in s 6 of the 1926 Act should be read into s 7(2) so that the subsection would read:

“‘Compensation shall be payable in respect of any personal injury arising out of and in the course of employment resulting in the death or serious and permanent disablement of a worker notwithstanding that’, etc.”

. But a construction of s 7(2) which would preserve in its entirety the significance of that distinction would have the result that s 7(2) – ‘a remedial section – will become a dead letter, a legislative tragedy of the first order’

(Thomas v Ocean Coal Co.

70 Like Herron J, Sugerman J (at 80) discerned in s 7(2) a legislative intention to confer “a more extensive right to compensation in respect of fatal, or seriously and permanently disabling, injuries than in respect of injuries of a lesser degree” – although there was a question as to “how much more extensive” that right was. In his Honour’s view (at 81) the definition of “injury” had to be read both into s 7(1) and in particular into sub-section (a) (s 9, 1987 Act). Once that was done, s 7(2) fell “into harmony with the whole scheme of workers’ compensation as developed in the legislation, and full effect [would] be given to the word ‘notwithstanding’ and to the whole of the clause which it introduces, if the expression ‘any injury’ in [s 7(2)] is understood as referring to any personal injury … which would have fallen within the terms of the definition but for the existence of one or more of the circumstances thereafter stated, for example the circumstance that when the injury was received the worker was acting in contravention of orders given by his employer.”

71 Sugerman J agreed (at 82) with Herron J that s 7(2) did not come into play where the injury did not arise out of or in the course of employment “for some reason entirely unconnected with the breach of the regulation” or order as, for example, where the worker arrogated to him or herself duties s/he was “neither engaged not entitled to perform”, “deserted the task for which [s/he] was paid” in order to do “someone else’s work of a different category” or was “doing another job” or something which was “not his job at all”.

72 Neither Herron J nor Sugerman J was able to discern the precise basis of the primary judge’s determination that the injury was not received in the course of employment, and so referred the case back to the Workers’ Compensation Commission for decision in accordance with the Court’s opinion.

73 The headnote to Love records McClemens J as having dissented. However, his Honour’s dissent was only as to whether, on the facts as found by the Commission, the Court could conclude that the worker’s injury arose out of his employment – his Honour would have been satisfied (see 91) that on the facts as found and on the proper application of the law to those facts, the worker was entitled to compensation. His Honour held (at 90) that s 7(2) should be interpreted as:

74 On his Honour’s view (at 90) that interpretation of s 7(2) accorded with well settled principles of interpretation of workers compensation legislation and recognised the “improbability of the word ‘injury’ bearing a different meaning in successive paragraphs of the same subsection”: cf Slazengers (Australia) Pty Ltd v Burnett [1951] AC 13 (at 21).

75 Love was expressly approved in Wheeler. Jacobs JA (Holmes and Mason JJA agreeing) described (at 476) as “proper” the approach of the Commissioner to determining whether s 7(2) applied. The Commissioner determined how the worker was injured, next, that on those facts the worker was not acting in the course of his employment and then whether that finding was based solely upon one or another of the circumstances set out in s 7(2) or whether the act which the applicant was doing at the time of his injury was one he was not employed to do at all. Love is cited in T Blundell (ed), LexisNexis Butterworths, Mills Workers Compensation New South Wales, vol 1 (at release 121) (at [WCA 14.2 - 14.3]) as authority on the interpretation of s 14(1).

76 Higgins concerned s 14(2) of the 1987 Act. Priestley JA (with whom Stein JA agreed) applied (at 55 – 57) Tiver Constructions Pty Limited v Clair (1992) 110 FLR 239 (a case concerned with the Northern Territory equivalent to s 14(2) – s 7(3) of the Workers’ Compensation Act 1949 (NT) – and not, with respect, a 1990 Act as Priestley JA said (at 55)). In Tiver, the worker was seriously injured when driving while intoxicated. At the time of the accident, he was driving a vehicle provided by his employer, carrying parts he had bought to his workplace and returning to his camp which was on his work site.

77 The Court of Appeal of the Supreme Court of the Northern Territory (Martin and Mildren JJ, Gallop J agreeing) affirmed the decision of the magistrate and Angel J that the worker was injured in the course of his employment. Their Honours concluded (at 247) that s 7(3) made it clear that an employee was not taken outside the course of his employment by his own serious and wilful misconduct if s/he suffered permanent and serious injury. In reaching that conclusion, their Honours applied Lord MacMillan’s observations in Harris v Associated Portland Cement Manufacturers Ltd [1939] AC 71 (at 83-84):

Amending legislation has affected this cardinal condition in a not very logical fashion

by providing that, if the accident results in death or serious and permanent disablement then, in certain cases, notwithstanding that certain facts are proved which might be thought to establish that the accident did not arise out of and in the course of the employment, the employer is to be precluded from so maintaining by reason of these facts alone

Further, but again only if the accident results in death or serious and permanent disablement, the employer is precluded from pleading that the accident did not arise out of and in the course of the employment because at the time of the accident the workman was (a) acting in contravention of a statutory or other regulation applicable to his employment or of orders given by or on behalf of his employer or (b) acting without instructions from his employer, provided in both cases that such act was done by the workman for the purposes of and in connection with his employer's trade or business

Workers’ Compensation Act.”

78 After referring to Tiver, Priestley JA (at 57) referred to the fact that case law established that a worker might suffer an injury while doing something in the course of employment “taken in its most literal sense, as for example, on the employer's premises during working hours, so clearly having nothing to do with the employment that the worker should not be considered to be in the course of employment when doing that thing” and gave as illustrations gross misconduct, acts by workers in breach of regulations or employer's orders and acts without instructions from the worker's employer. He then said (at 57 - 58):

Accordingly the view was taken that in the two types of case now provided for in New South Wales by s 14(1), so long as the act had been done for the purposes of or in connection with the employer's trade or business, the injury should still be regarded as one in the course of the worker's employment, and compensation should be payable notwithstanding that the case law would otherwise have brought about the contrary result.

The case law position was to be eased in an apparently slightly more restrictive way when it was serious and wilful misconduct of the worker which, the cases said, took the worker out of what otherwise would have been the course of employment. In the case of serious and wilful misconduct compensation was not payable and the case law was not to be eased unless the injury to the worker was solely attributable to the serious and wilful misconduct of the worker. Hence, provisions such as s 14(2).

Against this background, what seems to me to be the only workable approach to s 14(2) is that it is written on the assumption that in its absence, compensation under s 9 would be denied to a worker (because on the authorities ‘serious and wilful misconduct’ would have the result that an injury suffered by a worker guilty of such conduct would neither arise from nor be in the course of employment) and that the provision was inserted to reverse that result by precluding the application of the case law to ‘serious and wilful misconduct’ of the worker resulting in death or serious permanent disablement…” (emphasis in the first paragraph, and first sentence of the second paragraph, added)

Tompsett

Love

Wheeler

79 The worker in Higgins (who was injured while climbing down the laundry chute in order to go to the part of his workplace where clocking off etc was done) was held to have been injured because of his serious and wilful misconduct (using the laundry chute as a mode of travelling between floors). However, because it was solely that fact – that he chose to seriously misconduct himself in doing something he needed to do in the course of his employment – that took the worker outside the course of his employment, and because his injury was solely attributable to that misconduct, Priestley JA held s 14(2) entitled him to compensation (at 59). Powell JA dissented on the facts because (at 78) he concluded that on the facts as found by the Commissioner (see Priestley JA (at 51)), the worker was on a “frolic” when he was injured.

80 Two decisions on s 14(2) to which the Deputy President referred – Pollock and WorkCover Authority of NSW v Walsh – should be briefly referred to.

81 In Pollock, as Ipp JA explained (at [16]), the worker went into the office at his work for the sole purpose of administering an injection of heroin to himself. Needless to say, that “had nothing to do with his duties, [was] something that his employer had warned him against doing and of which his employer, to his knowledge, seriously disapproved.” Ipp JA reached his decision in Pollock (at [18]) that, “whatever s 14(2) means it does not convert conduct which was not in the course or within the scope of employment when the serious and wilful misconduct occurred into conduct that was in the course or within the scope of employment” with only passing reference to Higgins and without consideration of any other authorities which have considered s 14 or its predecessors. That was hardly surprising. The worker’s conduct clearly fell into that category Jordan CJ described in Tompsett (at 130) as standing outside the scope of his employment, irrespective of any prohibition.

82 In WorkCover Authority ofNSW v Walsh a truck driver travelling back to Wagga from Sydney ingested methamphetamine at a Marulan truck stop to keep him awake for the remainder of his journey. He died at that location after suffering a cardiac arrhythmia which was in part precipitated by the methamphetamine, a drug he had been using for a long time.

83 Tobias JA (Hodgson JA and McClellan AJA substantially agreeing) relied (at [56]) on Higgins for the proposition that s 14(2) “neutralised the deceased [worker]’s gross misconduct and the effect it might otherwise have had of taking the deceased outside the course of his employment so that compensation is nonetheless payable in respect of his death.” Both his Honour (at [56]) and Hodgson JA (with whom McClellan AJA also agreed) (at [2]) were of the view that for the worker’s misconduct to take him outside the course of employment, it had to have been misconduct that was foreign or repugnant to his employment – a formulation which appears to have been drawn from Starke J’s statement in South Maitland Railways Pty Ltd v James [1943] HCA 5; (1943) 67 CLR 496 (at 504) to the effect that even though a worker did an act s/he was not employed to do, it could nevertheless be regarded as “an act incident to his employment or not so far removed from the employment contemplated by the employer and worker as to exclude it from the course of his employment … [if] … not altogether foreign to the employer’s interests.” A similar notion appears in Tompsett as already discussed and in Hatzimanolis (at 479) where Mason CJ, Deane, Dawson and McHugh JJ referred to the test applied to determine whether an injury occurring during intervals between work was sustained “in the course of employment” as enabling “a satisfactory line of demarcation to be drawn between those injuries which are work-related and those which are so remote from the notion of the worker's employment as to not to call for compensation by the employer...” (emphasis added).

84 Tobias JA’s statements regarding s 14(2) in WorkCover Authority ofNSW v Walsh were obiter, as his Honour (at [63]) did not think the worker’s conduct in ingesting amphetamines in order to stay awake during a long-haul truck drive took him outside the course of his employment. As such, the dependants of the deceased worker were entitled to compensation under s 9, without the need for recourse to s 14. Tobias JA’s approach to s 14(2) reflected the approach in Love and Wheeler albeit that he did not refer to those cases. However his Honour arrived at his conclusion by applying Priestley JA’s approach in Higgins which, as I have observed, echoed those cases.

144 The Workers’ Compensation (Amendment) Act 1929 (NSW) (“the 1929 Amendment Act”) made further critical changes. It replaced s 7(1), but only so as to exclude the journey provisions from that subsection. More importantly, it replaced sub-s 7(2) so as to adopt the deeming provision in respect of unauthorised or prohibited conduct adopting the language of the 1923 UK amendment.

145 It may be noted that the novel structure of the 1926 Act omitted any reference to “arising out of” employment and, putting to one side journey claims, referred only to injury “in the course of” employment. The replacement of s 7(1) by the 1929 Amendment Act also removed reference to “in the course of” employment and introduced, for the first time, a definition of “injury” to mean “personal injury arising out of and in the course of the employment”, to be included in s 6. That had the potential for significant confusion, which subsists today. The combination of the causal and temporal conditions in the primary provision, s 7(1), was not controversial. However, the creation of the new definition meant that the same factors were introduced (for the first time) in the alternative basis for compensation in s 7(2).

146 The creation of the separate definition was to have a further consequence when, in 1942, the provisions for journey claims were reintroduced. Was the term “injury” then found in s 7(1)(b), limited to an injury as defined? If so, it would have been unclear to what extent the new provision expanded the basis for entitlement to compensation.

147 The omission of the reference to the causal and temporal conditions appears to have arisen from adopting the scheme of the Workers’ Compensation Act 1916 (Qld), which in turn appears to have relied upon an assortment of progenitors, including ones obtained from States of the USA. In the second reading speech of the 1929 Amendment Bill, the Minister stated (NSW Parliamentary Debates (2^nd series) vol 117, 22 March 1929, p 4073, col 2):

“The first amendment deals with the definition of ‘injury’. It brings that definition into line with the definition of the word ‘accident’ in the English Act. Both words mean the same thing.”

148 The precise import of the Minister’s statement is neither clear nor accurate. However, it is evident that the potential consequential effects of including the causal and temporal conditions within a new definition, were not intended or, in all likelihood, appreciated. It seems unlikely that the structural change was intended to affect the operation of the substantive provisions.

149 Further changes have occurred, the significance of which may not have been appreciated at the time. Thus, the definition section in the 1926 Act (s 6(1)) commenced, “In this Act, unless the context or subject matter otherwise indicates or requires”. Those words were not changed with the introduction of the new definition of “injury” in 1929. However, in the 1987 Act, the definition of “injury”, now found in s 4, is not the subject of qualifying words relating to contrary intention.

150 In Webb v The Commissioner for Railways (NSW) [1938] HCA 24; 59 CLR 593 the High Court considered a claim by a worker under s 7(2), which, following the 1929 Amendment Act, deemed unauthorised acts to arise out of and in the course of employment in the circumstances prescribed. The worker had findings of fact against him in the Commission, with which the Court was not prepared to interfere. Rich J noted that it had been conceded that the injury could not have been found to have arisen out of and in the course of his employment: p 603. Nevertheless, that did not preclude his claim under s 7(2). His Honour held that the terminology “for the purposes of and in connection with his employer’s trade or business” was “wider than the worker’s employment”: p 604. There was no suggestion in Webb that the definition of “injury” should be imported into the deeming provision, a step which would tend to render the provision ineffective. Whether that principle still prevails is less clear.

151 Not only have the introductory words to the definition section changed, but other provisions have been introduced. Thus, there are now provisions, said to operate “for the purposes of this Act”, and thus in the nature of deeming provisions, which incorporate journey claims (s 10), recess claims (s 11) and claims by trade union representatives (s 12), as providing that certain injuries are injuries “arising out of or in the course of employment”. Section 9A, which precludes compensation in respect of injuries unless the employment concerned “was a substantial contributing factor to the injury”, does not apply to those provisions just referred: s 9A(4). However, there is no express exclusion in relation to s 14(1), despite the fact that that provision, in its earlier emanations, had, although not entirely consistently, been treated as an independent basis for an entitlement to compensation.

152 Thus, in Tompsett v Southern Portland Cement Ltd (1941) 41 SR(NSW) 126, Jordan CJ described the deeming provision in s 7(2) as dealing

“… only with cases where, but for some breach of regulation, etc, the worker would have been acting within the scope of his employment. It does not touch the case where, irrespectively of any prohibition, the thing done would stand outside the scope of his employment”: at 130.

153 This proposition is sourced to the language of Lord Blanesburgh in Thomas v Ocean Coal at 115. Whether or not that support is available from the statement of Lord Blanesburgh, language supportive of the view explained by Jordan CJ may be found in the opinion of Lord Buckmaster, to which his Honour had earlier referred.

154 In Tiver Constructions Pty Ltd v Clair (1992) 110 FLR 239 at 247-248, the Northern Territory Court of Appeal, considered the statutory equivalents in that jurisdiction of subss 14(1) and (2) of the 1987 Act. The first relevant provision of the Workmen’s Compensation Act 1949 (NT), subs 7(1), was in the usual form for a primary entitlement, providing for an injury arising out of or in the course of employment. Subsection 7(3) contained the exception for serious and wilful misconduct, in terms equivalent to s 14(2) of the 1987 Act (but omitting the qualifier, “solely”). Subsection 7(4) was similar in structure and effect to s 14(1) of the 1987 Act.

155 Relying on observations of Lord Macmillan in Harris v Associated Portland Cement Manufacturers Ltd [1939] AC 71 at 83-84, the Court in Tiver concluded that it was, in respect of a claim engaging each of subss 7(1), (2) and (4), open to the employer to demonstrate that the injury did not occur in the course of employment, regardless of the internal statutory exception. That approach was followed by the majority in this Court in Higgins v Galibal Pty Ltd (t/as Hotel Nikko Darling Harbour) (1998) 45 NSWLR 45 at 54 (Priestley JA, Stein JA agreeing; Powell JA dissenting). However, the suggestion that the analysis of Lord Macmillan applied in respect of s 7(4), which was the equivalent of s 14(1) of the 1987 Act, dealing with unauthorised activity is inconsistent with the context in which His Lordship spoke and the legislative history, as then well-understood

156 Two other variations in the legislation over time need to be noted. First, the dual requirement in the definition of “injury” in s 6 of the 1926 Act (as amended in 1929) was replaced in 1942, so as to make the causal and temporal factors alternative bases for entitlement: Workers’ Compensation Act and Workmen’s Compensation (Broken Hill) Act (Amendment) Act 1942 (NSW), s 2(a)(ii). That is, it was sufficient (prior to the enactment of s 9A) if the injury either arose out of the employment or arose in the course of the employment. For the latter to be satisfied, no causal link was required: Kavanagh v The Commonwealth [1960] HCA 25; 103 CLR 547 at 556 (Dixon CJ), dealing with similar language in s 9(1) of the Commonwealth Employees’ Compensation Act 1930 (Cth).

157 Secondly, a more expansive view of the “course of employment” has been taken in relation to worker’s living away from home or temporarily away from their place of residence, being cases commonly referred to as “interval” or “interlude” cases: see, eg, Hatzimanolis.

158 Much of the debate appears to have arisen from the use in Hatzimanolis of the term “gross misconduct” as a basis for taking a worker outside the course of his or her employment, during an interval within an episode of employment: at 484. It has been treated as significant that the High Court did not use the well known phrase “serious and wilful misconduct”, although the phrase used may differ in meaning only in respects which are immaterial: see Tiver at 246-8; Higgins at 57E (Priestley JA).

159 Whether or not that is so, it is clear that the High Court in Hatzimanolis did not direct its attention to s 14(2) in the 1987 Act. If it had, it would have needed to consider whether the worker suffered a serious and permanent disablement. Hatzimanolis, therefore, does not address the question which arises in the present case, namely whether s 14(1) provides an independent entitlement to compensation, whereas s 14(2), consistently with its historical origins, constitutes an exception from the primary entitlement, subject to a qualifying exception in favour of injuries resulting in death or serious and permanent disablement. In Higgins, Priestley JA concluded (p 58B-C):

“Thus, I read s 14(2) as if it said:

‘If it is proved that an injury to a worker which but for this subsection would because of the worker’s serious and wilful misconduct be denied compensation under s 9 because of the case law taking the worker out of the defined meaning of injury, by virtue of this subsection when that injury is solely attributable to the serious and wilful misconduct of the worker and results in death or serious and permanent disablement compensation is payable in respect of that injury.’”

160 His Honour stated that he adopted that approach, because the only alternative would be to give s 14(2) “no operation at all”. However, that appears to give s 14(2) a form similar to s 14(1) as an independent source of entitlement. Historically the provisions served different functions; s 14(2) started life as a limitation on the primary entitlement in the case of relevant misconduct. When a qualifying exception was made to it, in the case of death or serious and permanent disablement, the appropriate reading required that the primary entitlement to compensation was restored, by disregarding the disqualifying misconduct: it did not create a new form of entitlement. Thus the injury must, at that time, otherwise have arisen out of and in the course of the employment.

161 It is also necessary to refer to the decision of this Court in WorkCover Authority of NSW v Walsh [2004] NSWCA 186. That case involved a worker employed as a truck driver who, on a break during a trip from Wagga Wagga to Sydney, took methamphetamine to keep him awake for the remainder of the journey, but died as a consequence of taking the drug. A claim by his dependants succeeded before the Commission. In this Court, an appeal by the WorkCover Authority, (being the party responsible for the uninsured employer) was dismissed.

162 The reasoning was largely unremarkable. It involved two considerations of no present relevance, first, the Court rejected an argument based upon what were said to be analogous circumstances in which a claim had failed, namely where a worker left his duties, went to a room within the place of employment, and injected himself with heroin, as a result of which he collapsed over a heater and suffered serious burns: see Pollock v Stickfast Labels Pty Ltd (In liq) [2002] NSWCA 360; 24 NSWCCR 279. In Pollock the act of the worker was entirely unrelated to his employment, being to satisfy a personal addiction. In Walsh, the ingestion of methamphetamine was to permit the worker to continue with his work, namely to keep himself awake through a long period of driving. Secondly, Walsh rejected a claim that the death was an intentional self-inflicted injury, within the scope of s 14(3).

163 Relevantly for present purposes, Walsh turned upon rejection of the proposition that, whilst his conduct was otherwise in the course of his employment, the deceased’s act in taking methamphetamine was “gross misconduct” and took him outside the course of his employment. After a careful consideration of the leading authorities, Tobias JA rejected that submission on two “independent” bases. The first was that s 14(2) “neutralised” the effect of the “gross misconduct”: at [56]. The second was that the misconduct was not such as to take him outside the course of his employment in the sense that his act was “entirely foreign or repugnant to his employment”: at [56]. In the end his Honour concluded that “the ingestion by the deceased of the amphetamines did not take him outside the course of his employment” but that, if it did, “s 14(2) applies to entitle his dependants to compensation”: at [63].

164 There remains the question of the relationship of s 14(1) to the primary basis of entitlement. The legislative history suggests it provides an independent basis of liability. On the other hand, the placement of the conditions of entitlement in a definition section place that view in doubt.

165 Generally, the importation of a definition into the language used in an operative provision will be understood to be subject to an implied qualification, “unless the contrary intention appears”, in the absence of express language to that effect: Interpretation Act 1987 (NSW), s 6. That implication arises because it is always necessary to read the language of a statute in context, a principle which applies as much to a definition as to an operative provision. No doubt it is appropriate, as emphasised in Pearce and Geddes, Statutory Interpretation in Australia (6^th ed, 2006) at [6.62], not to depart too readily from the direction as to meaning provided by an express definition. On the other hand, as explained by Dixon CJ in the context of another provision of the 1926 Act, in Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; 92 CLR 390 at 397:

“It may be illogical to speak of a man as a recipient of a sum of money in prescribing the calculation on the result of which his receiving the money is contingent, but the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed.”

166 The importance of the general principle that words must be read in their context so as to give effect, consistently and coherently, to the apparent purpose of the provision so read, has been described as a “cardinal rule of statutory interpretation”: K&S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd [1985] HCA 48; 157 CLR 309 at 315 (Mason J). For that reason, the absence of an express provision, and even the deletion of an express provision, in relation to contrary intention, is not determinative of the circumstances in which the definition of “injury” should be applied.

167 History suggests that the s 4 definition of “injury” should not be imported into s 14(1), which has its own criteria of connection with the employer’s trade or business. That construction, however, was considered and rejected, after expressly addressing the history of the provision, in Love v Lysaghts Works Pty Ltd (1957) 57 SR(NSW) 70 (Herron, Sugerman and McClemens JJ). Even McClemens J, who dissented as to the result, felt unable to support such a construction as it would have involved the term “injury” being used in its defined sense in one part of then s 7, but not in another. His Honour concluded that a finding that the injury arose from an act done “for the purposes of and in connection with his employer’s trade” (being the final words of the present s 14(1)) satisfied the alternative (causal condition) in the definition of “injury”, as arising out of the employment: at 90. (The other members of the Court were unable to determine whether such a factual finding had been made.)

168 The need to satisfy at least one limb of the definition of “injury”, when applying s 14(1), has been followed by Nielson J in the Compensation Court in Clyde v State of New South Wales (TAFE Commission) [1995] NSWCC 38; 12 NSWCCR 541 at 561 and Stojkovic v Telford Management Pty Ltd [1998] NSWCC 8; 16 NSWCCR 165 at [48]. It was also followed by this Court in Wheeler v Commissioner for Railways [1969] 2 NSWR 474. It was not suggested in the present case that this line of authority should not be followed, nor that it was clearly wrong.

169 In any event, whether s 14(1) provides an independent basis of entitlement, or whether the use of the term “injury” imports the definition including the primary basis of entitlement, is not a matter which needs to be determined in these proceedings, despite the fact that the issues were raised on the arguments presented by the parties. It is sufficient to assume, in favour of the appellant, that an independent basis of claim is available under s 14(1). On the findings of fact made by the Commission, as discussed below, such a claim would fail.

Application of principles

170 The Deputy President noted the question in the present case as “whether, when the staff party concluded and once behind the wheel of the staff car with an intention to drive [the appellant] was still in the course of her employment”: at [86].

171 On the approach adopted above, that question was to be determined by reference to the primary basis of entitlement, contained in s 9, with reference to the definition of “injury” in s 4. Because the injury was found to have resulted in “serious and permanent disablement” the fact that the injury was solely attributable (if that were a fact) to the serious and wilful misconduct of the worker, was irrelevant: s 14(2).

172 The Deputy President concluded that the appellant was “entitled to the benefit of the provisions of the Acts if it be established that it was her intention to travel home” when she left the party: at [91]. That approach appears to have been based on the assumption that travel from the last place at which she was present in the course of her employment for the day, to her home, fell within the course of her employment, merely because she was provided by her employer with a vehicle. The assumption raised a large question which appears not to have been addressed in the Commission. It is by no means clear why driving home (in a company car) should form the basis of an entitlement to compensation in the event of injury, absent a claim under s 10, relating to “journey claims”. However, because of the limited right of appeal and the manner in which the appeal was conducted, the assumption noted above must be accepted.

173 The Deputy President approached the issue on the basis that use of the employer’s vehicle for personal purposes, followed by a trip home, even on a work day, did not necessarily arise out of or occur in the course of employment. Whether for work-related or personal purposes, no doubt the appellant’s use of the vehicle was subject to conditions, although those were not referred to in the argument in this Court. Subject to those general conditions, it seems unlikely that the worker was subject to any greater degree of control or direction by her employer when travelling home, than when taking the vehicle to go shopping. To say she was furthering the interests of her employer in going home, because she would have the vehicle available for the next occasion of work-related use, is not a legally determinative consideration, nor even, it might be thought, one of material weight. The approach adopted by the Deputy President was undoubtedly open.

174 The Deputy President then considered whether she was entitled to compensation “founded upon the combined effect of the operation of section 4 and section 14 of the 1987 Act”: at [92]. That meant, in effect, that she needed to establish that, at the time of the “subject misconduct”, she was in the course of her employment and her act was not “foreign or repugnant to” her employment, to use the language of Tobias JA in WorkCover Authority of NSW v Walsh [2004] NSWCA 186 at [56].

175 The critical finding was that the appellant had “failed to establish she was in the course of employment during the one hour period between leaving the party and the occurrence of injury”: at [101]. Because s 14(2) operated as a qualification in respect of serious and wilful misconduct which occurred only where the course of employment test was otherwise satisfied, that provision was held to be of no assistance to the appellant.

176 The findings of primary fact from which the Deputy President reached this conclusion were as follows:

(i) in normal traffic, it took the appellant 30 minutes to travel from her employer’s office in the City to her home in Beecroft;
(ii) the period between leaving the party at the bottom of King Street in the City and the accident on Epping Road (well short of Beecroft) was one hour;
(iii) the appellant had a blood alcohol reading of .124 shortly after the accident, and
(iv) she had been directed by her employer not to drive in her inebriated state.

177 It remains necessary to consider the appellant’s argument that the Deputy President failed to apply the principles established in Hatzimanolis. However, the reliance on that decision was misconceived. The claimant in that case was working at a remote mine site in Western Australia, the employer providing rent-free accommodation for its workers at a camp. He was injured on a site-seeing journey on his day off. The High Court accepted that he was entitled to compensation “on the ground that the appellant sustained injury during an interval occurring within an overall period or episode of work and while engaged, with his employer’s encouragement, in an activity which his employer had organized”: at 476. Because, the appellant argued, her employer had provided her with a car, and “authorised, encouraged or permitted” her to use the vehicle to drive home after work, it followed that she remained in the course of her employment until she reached home. That submission, however, omits two critical statements of principle in Hatzimanolis. First, their Honours said (at 482):

“However, it would be an unacceptable extension of the course of employment to hold that an employee was within the course of employment whenever the employer had authorised, encouraged or permitted the employee to spend the time during an interval between periods of actual work at a particular place or in a particular way.”

178 On the alternative approach, the relevant episode of work concluded when she left the party because, although the period might have included the trip from the party to her home, she failed to establish that she commenced such a trip when she left the party.

179 Secondly, unlike Hatzimanolis, this was not a case where the worker was living away from home so as to permit the conclusion that the overall period or episode of work extended beyond the hours required in a particular day. As the joint judgment also stated (at 483):

“The course of employment is ordinarily perceived as commencing when the employee starts work in accordance with his or her ordinary or overtime hours of work and as ending when the employee completes his or her ordinary or overtime hours of work.”

180 Accordingly, although the principle stated in Hatzimanolis may be seen as expansive of the concept of “course of employment”, it did not in terms apply to the present circumstances.

181 The Deputy President thought it unnecessary, given the findings noted at [176] above, to consider other arguments put forward by the appellant, including the application of s 14(1). Assuming that s 14(1) provided a separate basis for entitlement, not dependent upon demonstrating an entitlement on the primary basis, namely an injury arising out of or in the course of employment, the Deputy President further held at [105]:

“Given the Arbitrator’s findings at [9.10] of Reasons, the worker may not place reliance on the provisions of section 14(1) given that it could not be said that the act of driving and her disobedience of the direction not to drive could be perceived as having been done by the worker for the purposes of and in connection with the employer’s trade or business.”

182 These brief observations demonstrate the dangers of seeking to address matters which are thought not to be in issue. They can be characterised as “anticipatory comments”, made without a proper consideration of the relevant issues, and open to be given little or no weight: see Wade v Burns [1966] HCA 35; 115 CLR 537 at 555 (Barwick CJ). The findings of the Arbitrator, which the Deputy President had set out at [77] of his own reasons, included the fact that her blood alcohol reading meant that she was driving in contravention of a statute applicable to her employment and also that she was driving in contravention of orders given by her employer. However, those were the matters which were to be disregarded in considering an entitlement under s 14(1). Section 14(1) would be internally incoherent if the very matters which were to be disregarded were to lead to the conclusion that the act was not done by the worker “for the purposes of and in connection with the employer’s trade or business”. That test, as noted above, was deliberately adopted to avoid any question as to whether disobedience to instructions or statutory regulation resulted in the action of the worker falling outside the course of his or her employment.

183 Despite the erroneous approach to s 14(1) and on the assumption that it could provide an independent basis for a claim, putting to one side the fact that she was not within the course of her employment at the time of receiving the injury, this was not a case where the worker could succeed under that provision. Having concluded that she had left the party, not to go home, but to follow some personal pursuit, it could not be said that at the time of the accident the appellant’s act of driving was being done for the purposes of and in connection with the employer’s business. This language was introduced into the legislation before there was express provision for journey claims (or recess claims). It was designed to provide an entitlement where, as in the coal mining cases, the courts were inclined to exclude from the course of employment prohibited acts, even though such acts were clearly undertaken for the purposes of the employer’s business, and not to further some purpose or interest of the worker.

184 Accordingly, in the circumstances of this case, no different result could have been reached by applying the correct test, even if it had been open to treat s 14(1) as an independent basis of claim.

185 In the circumstances, it is not necessary to address the potential operation of s 9A. It is sufficient to note that the treatment of journeys from a place of abode to a place of employment as falling within the course of employment as primarily defined will lead to the application of s 9A, so as to require that the employment concerned be a substantial contributing factor to the injury. That requirement, understandably, does not apply to a journey claim, nor to a recess claim. Thus an expansive approach to the scope of the course of employment test in s 4, so as to exclude reliance on ss 10 and 11, will not necessarily be beneficial to the worker’s entitlements.

186 Finally, to the extent that the appellant relied upon her injury as one received in the course of a journey covered by s 10, she failed because the entitlement arising out of s 10(1) did not to apply if the injury were attributable to the serious and wilful misconduct of the worker: s 10(1A). The conduct was so attributable if the worker was at the time of the accident under the influence of alcohol, unless the alcohol did not contribute in any way to the injury: s 10(1B). The Deputy President held that those exceptions were engaged so that the appellant could not succeed under s 10(1): at [115]. That conclusion was not challenged on the appeal. Nor, it appears, was it contended that the worker could obtain the benefit of s 14(2), as a limitation on the operation of s 10(1A): see Wilson v Wilson’s Tile Works Pty Ltd [1960] HCA 63; 104 CLR 328.

Conclusions

187 It follows that, in resolving the appeal from the decision of the Arbitrator, the Deputy President made no decision in point of law which was legally erroneous in a material respect. The appeal to this Court must be dismissed. The appellant must pay the respondent’s costs of the appeal.

188 HANDLEY AJA: I have had the benefit of reading the judgments of McColl JA and Basten JA in draft. They have set out the facts, the findings of the Deputy President, the current legislation and the legislative history, here and in the United Kingdom, behind the current legislation. There is no need for me to repeat this material.

189 Section 14(1) of the 1987 Act, construed in the light of its legislative history and the judicial interpretation of its predecessors, applies to an injury defined in s 4. The relevant paragraph of the definition is in that part of para (a) which covers personal injury arising in the course of the worker’s employment. There is an established line of authority on its predecessor, s 7(2) of the 1926 Act, inserted in 1942, derived from s 1(2) of the Workmen’s Compensation Act 1925 (Imp) (the 1925 Act).

190 As Jordan CJ said in Tomsett v Southern Portland Cement Ltd (1941) 41 SR (NSW) 126, 130:

“... s 7 (2) deals only with cases where, but for some breach of regulation etc the worker would have been acting within the scope of his employment. It does not touch the case where, irrespectively of any prohibition, the thing done would stand outside the scope of his employment.”

191 This decision was followed and applied in Love v Lysaght Works Pty Limited (1956) 57 SR (NSW) 70; Wheeler v Commissioner for Railways [1969] 2 NSWR 474 CA; and Higgins v Galibal Pty Limited (1998) 45 NSWLR 45 CA. The headnote for Love v Lysaght Works is incorrect because it includes the text of s 7(1)(a) in the 1926 Act, and not the section inserted in 1929 which was in force when Love was injured.

192 Section 14(1) does not assist the appellant because driving home after the employer’s Christmas party was not an “act done by the worker for the purposes of and in connection with the employer’s trade or business”. The Deputy President’s finding to that effect was not vitiated by legal error, and cannot be disturbed.

193 The appellant also relied on s 14(2). This must also be construed in the light of its legislative history here and in the United Kingdom, and the judicial interpretation of its predecessors, s 7(3)(b) of the 1926 Act and s 1(2)(c) of the Workmen’s Compensation Act 1906 (Imp) (the 1906 Act) and s 1(b) of the 1925 Act.

194 Section 14(2), like its predecessors, prima facie denies any entitlement to compensation where “it is proved that an injury to a worker is solely attributable to the serious and wilful misconduct of the worker.” The result does not depend on the judicial exegesis of the scope of the worker’s employment, but on the text of the section.

195 In Hatzimanolis v ANI Corporation Ltd [1992] HCA 21, 173 CLR 473, 484 the plurality said with reference to the facts of that case:

“... an injury sustained in such an interval will be within the course of employment if it occurred at that place or while the employee was engaged in that activity unless the employee was guilty of gross misconduct taking him or her outside the course of employment.”

196 This dictum, about the effect of gross misconduct, was made in respect of the 1987 Act, which contained s 14(2) in its current form. The section applies to all injuries sustained by a worker including those received during an overall period or interval of work, which was the situation in Hatzimanolis. This dictum led Priestley JA to say in Higgins ((1998) 45 NSWLR at 58):

“Against this background, what seems to me to be the only workable approach to s 14(2) is that it is written on the assumption that in its absence, compensation under s 9 would be denied to a worker (because on the authorities ‘serious and wilful misconduct’ would have the result that an injury suffered by a worker guilty of such conduct would neither arise from nor be in the course of employment) and that the provision was inserted to reverse that result by precluding the application of the case law to ‘serious and wilful misconduct’ of the worker resulting in death or serious permanent disablement.”

197 Compensation in cases of serious and wilful misconduct has been denied by statute in the United Kingdom from the very first, by the Workmen’s Compensation Act in 1897 (Higgins at 60), and in this State from the very first, by the Workmen’s Compensation Act in 1910 (Higgins at 63). Disentitlement in such cases has never depended on a finding that the injury was not received in the course of the worker’s employment. Although misconduct could take the worker outside the course of his employment in some cases, serious and wilful misconduct will disentitle the worker in all cases unless it results in death or serious and permanent disablement.

198 There is no reason for thinking that the plurality in Hatzimanolis intended to establish a new principle independent of the text of s 14(2). In any event the statutory text must prevail: Ogden Industries Pty Limited v Nash [1970] AC 113, 127, 129. The plurality’s reference to gross misconduct should, in my judgment, be understood as a reference to the effect of that section.

199 Section 14(1) and its predecessors here and in the United Kingdom dealt with some of the special problems created by statutory or other prohibitions which were ignored by a worker. In some cases prohibitions could limit the scope of the worker’s employment. A deliberate breach could also constitute serious and wilful misconduct. The former were addressed in part by s 14(1), the latter by s 14(2).

200 In my judgment s 14(2), as the text indicates, does not deal with the scope of the worker’s employment. It assumes an injury which arises out of or in the course of the worker’s employment which created a prima facie entitlement to compensation. It then denies that entitlement in cases of proved serious and wilful misconduct except where the injury results in death or serious and permanent disablement.

201 The Deputy President found [101] that the worker had failed to establish that she was the course of her employment during the one hour period between leaving the party and the occurrence of the injury. In my judgment that finding was not vitiated by legal error and cannot be disturbed.

202 It cannot be said that the employer expressly or impliedly induced or encouraged the worker to drive herself home in the company vehicle. Her employer prohibited her from doing this and the worker is not protected from the consequences of her deliberate disobedience by s 14(1) because the act of driving home was not done for the purposes of and in connection with the employer’s trade or business. I also reject the appellant’s general submission that her entitlement to use a company vehicle for private as well as corporate purposes brought all her driving of the vehicle for private purposes within the course of her employment.

203 I am therefore in substantial agreement with Basten JA and support the orders he has proposed.

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Scharrer v The Redrock Co Pty Ltd [2010] NSWCA 365

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The RedRock Company Pty Limited v Scharrer [2009] NSWWCCPD 72

Scharrer v The RedRock Company Pty Limited [2009] NSWWCCPD 73

CITATION:	Scharrer v The Redrock Co Pty Ltd [2010] NSWCA 365
HEARING DATE(S):	24 June 2010
JUDGMENT DATE:	20 December 2010
JUDGMENT OF:	McColl JA at 1; Basten JA at 106; Handley AJA at 188
DECISION:	Appeal dismissed with costs. [The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
CATCHWORDS:	APPEAL – civil – statutory appeal – whether appellant aggrieved by decision of Deputy President on point of law – s 353, Workplace Injury Management and Workers Compensation Act 1998 (NSW) - WORKERS COMPENSATION – whether injury sustained "in the course of employment" – conduct of worker – vehicle provided by employer – employee injured driving home from employer's Christmas party – employee driving in contravention of orders given by employer and under the influence of alcohol – s 14(1), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION –"arising out of or in the course of employment" – s 4, s 14(2), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION – conduct of worker – whether employee's actions "for the purposes of and in connection with the employer's trade or business" – s 14(1), Workers Compensation Act 1987 (NSW) - WORKERS COMPENSATION – whether employment a substantial contributing factor to the injury – s 9A, Workers Compensation Act 1987 (NSW) - WORDS AND PHRASES – "in the course of employment", "for the purposes of and in connection with the employer's trade or business"
LEGISLATION CITED:	Coal Mines Act 1911 (UK) Commonwealth Employees’ Compensation Act 1930 (Cth) Interpretation Act 1987 (NSW) Road Transport (Safety and Traffic Management) Act 1999 (NSW) Social Security Contributions and Benefits Act 1992 (UK) Workmen’s Compensation Act 1910 (NSW) Workmen’s Compensation Act 1916 (NSW) Workers’ Compensation Act 1926 (NSW) Workers’ Compensation (Amendment) Act 1929 (NSW) Workers’ Compensation Act and Workmen’s Compensation (Broken Hill) Act (Amendment) Act 1942 (NSW) Workers' Compensation Act 1987 (NSW) Workers’ Compensation Act 1949 (NT) Workers’ Compensation Act 1916 (Qld) Workmen’s Compensation Act, 1897 [60 & 61 Vict, Ch 37] Workmen’s Compensation Act 1906 (Imp) Workmen’s Compensation Act 1923 (Imp) Workmen’s Compensation Act 1925 (Imp) Workplace Injury Management and Workers Compensation Act 1998 (NSW)
CATEGORY:	Principal judgment
CASES CITED:	A G Moore & Co v Donnelly; Fife Coal Co Ltd v Sharp; Fife Coal Co Ltd v Fyfe [1921] 1 AC 329 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd [2005] HCA 26; (2005) 221 CLR 568 Badawi v Nexon Asia Pacific Pty Ltd [2009] NSWCA 324; (2009) 75 NSWLR 503 Bill Williams Pty Ltd v Williams [1972] HCA 23; (1972) 126 CLR 146 Bourton v Beauchamp [1920] AC 1001 Clyde v State of New South Wales (TAFE Commission) [1995] NSWCC 38; 12 NSWCCR 541 Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; 92 CLR 390 Da Ros v Qantas Airways Ltd [2010] NSWCA 89 Gibb v The Commissioner of Taxation of the Commonwealth of Australia [1966] HCA 74; (1966) 118 CLR 628 Harris v Associated Portland Cement Manufacturers Ltd [1939] AC 71 Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473 Henderson v Commissioner for Railways (Western Australia) [1937] HCA 67; (1937) 58 CLR 281 Higgins v Galibal Pty Ltd t/as Hotel Nikko Darling Harbour (1998) 45 NSWLR 45 K&S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd [1985] HCA 48; 157 CLR 309 Kavanagh v The Commonwealth [1960] HCA 25; (1960) 103 CLR 547 Kennedy Cleaning Services Pty Ltd v Petkoska [2000] HCA 45; (2000) 200 CLR 286 Kuru v State of New South Wales [2008] HCA 26; (2008) 236 CLR 1 Love v Lysaghts Works Pty Ltd [1957] SR (NSW) 70 Minchinton v Homfray (1994) 10 NSWCCR 778 Noble v Southern Railway Co [1940] AC 583 Ogden Industries Pty Limited v Nash [1970] AC 113 Pollock v Stickfast Labels Pty Ltd (in Liq) [2002] NSWCA 360; (2002) 24 NSWCCR 279 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 Scharrer v The Red Rock Company Pty Ltd [2009] NSWWCCPD 73 Slazengers (Australia) Pty Ltd v Burnett [1951] AC 13 Smith v Australian Woollen Mills Ltd [1933] HCA 60; 50 CLR 504 Smith v Brown (1998) 16 NSWCCR 492 South Maitland Railways Pty Ltd v James [1943] HCA 5; (1943) 67 CLR 496 Stojkovic v Telford Management Pty Ltd [1998] NSWCC 8; 16 NSWCCR 165 Thomas v Ocean Coal Co Ltd [1933] AC 100 Tiver Constructions Pty Limited v Clair (1992) 110 FLR 239 Tompsett v Southern Portland Cement Ltd (1941) 41 SR (NSW) 126 Vetter v Lake Macquarie City Council [2001] HCA 12; (2001) 202 CLR 439 Wade v Burns [1966] HCA 35; 115 CLR 537 Watson v Qantas Airways Ltd [2009] NSWCA 322; (2009) 75 NSWLR 539 Webb v The Commissioner for Railways (NSW) [1938] HCA 24; 59 CLR 593 Wheeler v Commissioner for Railways [1969] 2 NSWR 474 Wilson v Wilson’s Tile Works Pty Ltd [1960] HCA 63; 104 CLR 328 Wilsons & Clyde Coal Co Ltd v M'Ferrin; Kerr v James Dunlop & Co Ltd [1926] AC 377 WorkCover Authority of NSW v Walsh [2004] NSWCA 186 Zickar v MGH Plastic Industries Pty Ltd [1996] HCA 31; (1996) 187 CLR 310
TEXTS CITED:	T Blundell (ed), LexisNexis Butterworths, Mills Workers Compensation New South Wales, vol 1 (at release 121) R Lewis, “Accidents Whilst Travelling and the Limits of Compensation for Industrial Injury” (1986) J Soc Welfare L 193 CP Mills, Workers Compensation (New South Wales), 2nd ed (1979) Butterworths Pearce and Geddes, Statutory Interpretation in Australia (6th ed, 2006) Willis and Everett, Willis’s Workmen’s Compensation, 36th ed (1944) Butterworth
PARTIES:	Camilla Roslyn Scharrer - Appellant The Redrock Co Pty Ltd - Respondent
FILE NUMBER(S):	CA 2009/298404
COUNSEL:	JB Simpkins SC with CA Goodman for the Appellant SG Campbell SC with IA Todd for the Respondent
SOLICITORS:	Lucas & Staggs Lawyers - Appellant Turks Legal - Respondent
LOWER COURT JURISDICTION:	Workers Compensation Commission
LOWER COURT FILE NUMBER(S):	A2-006788 of 2008
LOWER COURT JUDICIAL OFFICER:	O'Grady DP
LOWER COURT DATE OF DECISION:	1 July 2009
LOWER COURT MEDIUM NEUTRAL CITATION:	[2009] NSWWCCPD 72