Vinidex Pty Ltd v Campbell
[2012] NSWWCCPD 6
•10 February 2012
| WORKERS COMPENSATION COMMISSION | |||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | |||||
| CITATION: | Vinidex Pty Ltd v Campbell [2012] NSWWCCPD 6 | ||||
| APPELLANT: | Vinidex Pty Ltd | ||||
| RESPONDENT: | Gregory Campbell | ||||
| INSURER: | QBE Insurance (Australia) Limited | ||||
| FILE NUMBER: | A1-4995/11 | ||||
| ARBITRATOR: | Mr Jeffrey Phillips | ||||
| DATE OF ARBITRATOR’S DECISION: | 17 October 2011 | ||||
| DATE OF APPEAL DECISION: | 10 February 2012 | ||||
| SUBJECT MATTER OF DECISION: | Injury in the course of employment: s 4 of the Workers Compensation Act 1987; employment being a substantial contributing factor to the injury: s 9A of the Workers Compensation Act 1987; serious and wilful misconduct; serious and permanent disablement: s 14(2) of the Workers Compensation Act 1987 | ||||
| PRESIDENTIAL MEMBER: | Deputy President Kevin O'Grady | ||||
| HEARING: | On the papers | ||||
| REPRESENTATION: | Appellant: | Bartier Perry Lawyers | |||
| Respondent: | Slater & Gordon Lawyers | ||||
ORDERS MADE ON APPEAL: | 1. For the reasons given in this decision the Arbitrator’s determination of 17 October 2011 is confirmed. 2. Appellant is to pay the costs of this appeal. | ||||
BACKGROUND
Mr Gregory Campbell was employed as a production operator in the manufacture of plastic pipes by Vinidex Pty Ltd, the appellant, at its premises near Wagga Wagga, New South Wales. At 6.30 pm on 17 August 2010, Mr Campbell attended work on his scheduled 12 hour shift. He worked with a supervisor, Mr Jeremy Kelleher and fellow worker Mr Jamie Watson. During that shift, at approximately 2.20 am, Mr Campbell was injured. By reason of a head injury then received, he is unable to recall the circumstances.
There is no dispute as to the basic facts concerning the occurrence of the subject injury. It seems that a decision was made that night by Mr Campbell, Mr Kelleher and Mr Watson to cut a plastic pipe and to fashion a “board” which they intended to use as a “wake board” as it was towed on the factory floor by a forklift. A sling attached to the board was fastened to the towing pin on the forklift. A small “board” was used first. Mr Kelleher, who had cut that particular board, then cut and fabricated a larger board. That larger board was attached to the forklift by a sling. Mr Kelleher drove off in the forklift at which time both Mr Campbell and Mr Watson were on the board. The board was towed between line two and line eleven within the factory premises. Mr Kelleher turned the forklift to the left and commenced to make a U‑turn. At that time the board swung outwards causing Mr Campbell and Mr Watson to either fall or jump off. As Mr Campbell left the board he fell, striking his head on a timber support used to align pipes stored on the factory floor.
An ambulance attended the scene and Mr Campbell was transported to the Wagga Wagga base hospital. He was subsequently transferred to the St George hospital in Sydney. A CT scan demonstrated “bilateral small subdural haematomas with right temporal lobe contusions and blood located in the midline just beneath the tentorium cerebelli”. He had also suffered a laceration/contusion to his left occipital area.
Mr Campbell has not returned to gainful employment since the injury. His employment with the appellant was terminated on 19 September 2010 on the ground of misconduct which was particularised as being “unsafe work practices”.
A claim for compensation benefits made by Mr Campbell was denied on behalf of the appellant by its insurer. The dispute concerning entitlement to benefits came before the Commission following the filing of an Application to Resolve a Dispute by Mr Campbell in June 2011. The matter came before Arbitrator Mr Jeffrey Phillips SC for conciliation and arbitration on 18 August 2011 at which time both parties were represented by counsel. The Arbitrator reserved his decision at the conclusion of the arbitration. A Certificate of Determination, accompanied by a Statement of Reasons (Reasons), issued on 17 October 2011. Awards were entered in favour of Mr Campbell.
The Certificate of Determination is in the following terms:
“The Commission determines:
1. An award for the applicant for weekly benefits pursuant to section 36 of the
Workers Compensation Act 1987 at the rate of $1,064.40 per week from 18 October 2010 to date and continuing in accordance with the provisions of the workers compensation legislation. The injuries suffered on 18 August 2010.2. The respondent will pay the applicant’s section 60 medical expenses in relation to the injuries received by him on 18 August 2010 in accordance with the provisions of the Workers Compensation Act 1987.
3. The respondent will pay the applicant’s costs as agreed or assessed. I provide uplift of 30 per cent to those costs available to both parties on account of complexity.
A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”
An appeal against the Arbitrator’s decision was registered by the appellant on 11 November 2011.
ISSUES IN DISPUTE
The issues in dispute raised on this appeal, as set out in the grounds of appeal, concern whether the Arbitrator erred in the following respects:
(a) finding that Mr Campbell received injury arising out of or in the course of his employment with the appellant: s 4 of the Workers Compensation Act 1987 (the 1987 Act);
(b) failing to find that the “gross misconduct of [Mr Campbell], as found by [the Arbitrator]” took Mr Campbell “outside the scope of his employment”;
(c) finding that Mr Campbell’s employment was a substantial contributing factor to his injuries: s 9A of the 1987 Act;
(d) determining that “the provisions of s 14(2) of the 1987 Act prevented a finding that [Mr Campbell’s] gross misconduct took him outside the scope of his employment”;
(e) finding that Mr Campbell’s injuries were “serious and permanent and failed to provide sufficient reasons for so finding”: s 14(2) of the 1987 Act, and
(f) finding that Mr Campbell’s injuries were “serious and permanent” in the absence of sufficient evidence.
The formulation of these grounds, particularly those concerning s 14(2), are open to criticism. Those deficiencies are addressed in the course of discussion below.
ON THE PAPERS REVIEW
Section 354(6) of the 1998 Act provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Nos 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time as found in the provisions of s 352(3) and s 352(4) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) have been met.
THE ARBITRAL PROCEEDINGS
The documentary evidence before the Arbitrator was summarised by him at [6] of Reasons. No oral evidence was given at the hearing. The proceedings were recorded and a transcript (T) has been produced and made available to the parties.
Mr Campbell’s evidence
Mr Campbell relied upon a very large volume of medical notes and records relating to his treatment following the injury. Those documents include reports from Dr Erica Jacobson, neurosurgeon, Dr David Burke, consultant in rehabilitation medicine, Dr Peter Keith, general practitioner and a summary of Mr Campbell’s rehabilitation program compiled by Robert Parker, case coordinator of the South West Brain Injury Rehabilitation Service. Also in evidence are ambulance records, hospital records, various medical records and radiological reports. It is noted that several of these documents detail inconsistent histories concerning the manner in which Mr Campbell was injured.
A statement by Mr Campbell dated 1 February 2011 is in evidence. It is there stated, as appears in his claim form, a copy of which is in evidence, that he cannot recall the circumstances of his injury. Concerning the events which occurred on 18 August 2010, Mr Campbell states:
“On 18 August 2010 I attended at work on the nightshift. It was a 12-hour shift being 6.30pm to 6.30am.
Mr Kelleher was my Supervisor; I would estimate he was 1 year younger than me. He was usually pretty strict and we had never used the forklift as was used on the night of 18 August, nor had we ever used pipe to scoot around the factory.
The occurrences of 18 August 2010 were the first time that that had occurred.
I have very little memory of the night; I remember it was a slow night. I was on one of the lines working with the machine. The other 2 boys, being Jeremy Kelleher and Jamie Watson, had nothing to do.
I remember I had a big pipe on the line and it was coming out slowly.
I have no further recollection after that.”
Dr Jacobson describes the subject head injury as “a significant head injury with bilateral temporal bleeds with right temporal contusions, some tenurial blood and some blood over the right hemisphere”.
The relevant detail of the above mentioned documents and the balance of Mr Campbell’s documentary evidence are addressed in the course of discussion below.
The appellant’s evidence
The appellant relied upon the contents of a factual investigation report prepared by MPOL Group (NSW) Pty Ltd addressed to the insurer. Relevant factual matters are addressed in a report compiled by WorkCover, an investigation report by Stuart Percy, safety health and environment manager, employed by the appellant and in a police incident report, all of which are attached to the report. I note that pages 7–11 inclusive of Mr Percy’s report have been omitted from the evidence filed.
The WorkCover report dated 22 September 2010 contains a “summary of events” which describes the relevant facts as ascertained by the inspector during the investigation. That summary is as follows:
“About 2.00 pm [sic, am] on Wednesday the 18th of August 2010, the Injured Person and a Co-Worker Jamie Watson D.O.B xxx were being towed behind a Crown Pro5 Forklift Truck Model CG25P, which was being driven by Jeremy James Kelleher xxx who holds the position of shift supervisor. At the time, the Injured Person and Watson were sitting/kneeling on a piece of plastic measuring approximately 2.2 metres long x 630 millimetres wide. This piece of plastic was connected by way of a 2 ton webbing sling through the rear hitch on the forklift. It is believed that Kelleher has driven the forklift along the concrete floor of the factory in a southerly direction at an unknown speed, prior to turning the forklift sharply with the intention of travelling north. In doing so, both the Injured Person and Watson have skidded off the plastic onto the concrete floor. After making the turn, Kelleher has looked back to see Watson running back to the Injured Person who was lying beside a large plastic pipe on the concrete floor. At the time his head was in the vicinity of a piece of timber packing, which the plastic pipe was resting upon. Although conscious, he was incoherent and bleeding from a wound to the upper rear portion of his head. The Ambulance was called and whilst waiting for the Ambulance to attend the scene, the Injured Person started to become agitated and aggressive. Upon arrival of Ambulance Officers his mental state continued to deteriorate and with the assistance of Police Officers, the Injured Person was sedated prior to being transported to Wagga Wagga Base Hospital. Upon arrival at Wagga Base Hospital, the Injured Person was examined and found to have sustained bleeding to the brain. As a result he has been transferred via air ambulance to a Sydney Hospital where he is believed to be in a stable condition. Police including Detectives have attended the scene along with Physical Evidence Police from Albury. The Forklift truck has been taken into Police possession for mechanical examination.”
The police incident report identifies the driver of the forklift at the relevant time as being Jeremy Kelleher.
There is also attached to the MPOL investigation report a detailed statement by Stuart Percy. That statement generally confirms the circumstances of Mr Campbell’s injury, as described above, which Mr Percy ascertained during an investigation. The following is recorded:
“From information provided in a statement from Jamie Watson relating to the circumstances of the accident, the workers had some quiet time and were sitting around talking when the idea of towing the QA table behind the forklift was raised by Gregory Campbell. It was then decided (I don’t know by who) that it would be too dangerous and Gregory suggested cutting up some pipe and using it like a wake board.
Kelleher went out and cut a small ‘board’ whilst Gregory moved three lengths of 900 mm 20 metre pipe out of the way, each of these pipes weighs about 3.6 tonne.
The staff then used a lifting sling threaded through the front of the ‘board’, attached to the towing pin on the forklift to pull the ‘board’. They all had a turn of riding the small ‘board’, it was allegedly too slow so Kelleher went and cut a larger one.
Apparently all three commented on what would happen if bosses walked in, they acknowledged they would probably get the sack.
For the first ‘run’ on the larger ‘board’ Kelleher drove the forklift while Watson and Gregory sat on the larger ‘board’, Watson at the front and Gregory at the back. I do not know if they were standing, kneeling or sitting on the ‘board’.
They started near line two and went forward parallel to line 11, Kelleher then turned the forklift and did a U-turn (to the left) and as the ‘board’ swung out Gregory fell off near the scrap pipe and Watson fell off near the line 11 tilt table. Watson turned and looked towards Gregory and then Kelleher, and then both ran to the area of Gregory. Gregory wasn’t breathing and his eyes had rolled back into his head. After a few seconds he began breathing with difficulty and the staff rolled him into the recovery position. Shortly after an ambulance was called. After this Gregory allegedly got to his feet and walked/ran around speaking incoherently prior to the police arriving and assisting the ambulance officers to sedate him and take him from the site by ambulance.”
Mr Percy stated (at [12] of his statement) that “Jeremy Kelleher was supervisor on the shift. Jamie [Watson] and [Mr Campbell] were production operators. The three staff were to operate and supervise machinery and manufactured stock for the shift as well as staff”.
The duties of Mr Campbell and his fellow workers were described in more detail by Mr Percy (at [30]) in the following terms:
“While production is underway machines need to be monitored, quality checks performed, production conditions recorded, product packaging performed and production transportation to storage yard as well as general housekeeping to be monitored and performed. This is what the staff should have been doing at the time of the incident and this has been reiterated to staff since the date of the incident. This information is included in Gregory’s position description.”
There is a document in evidence headed “Root Cause Analysis Sheet”, a record of the appellant’s, which records matters relevant to the injury. It is there recorded that “the products being manufactured during the night shift were running well and there was substantial time between packing requirements”.
Mr Percy’s investigation report includes short statements made by Jamie Watson and Jeremy Kelleher. Details of those statements, where relevant, are addressed below.
Submissions before the Arbitrator
The appellant’s insurer had given Mr Campbell two notices denying liability in accordance with s 74 of the 1998 Act, the first dated 24 September 2010 and the second dated 11 March 2011. That fact gave rise to some confusion in preliminary argument at the hearing before the Arbitrator concerning the identification of the issues in dispute. The Arbitrator, in his Reasons (at [27]), ruled that the appellant be permitted to defend the claim “in accordance” with the second s 74 notice dated 11 March 2011. Those matters in dispute, he noted, had been “fully argued by the parties at the hearing”.
Counsel for Mr Campbell appears to have made an assumption in argument that injury had been established on the evidence (at T9.1). In response to questioning from the Arbitrator it seems to have been argued that to establish injury, reliance was placed upon the medical evidence and the “temporal connection” between injury and work. Counsel then addressed matters raised by s 9A of the 1987 Act. Reliance was placed upon the decision of Roche DP in Whittingham v Ascott Airconditioning Pty Ltd [2010] NSWWCCPD 36 (Whittingham) and the assertion was made that “9A is not a problem for [Mr Campbell] in this case”.
Counsel for the appellant commenced submissions by drawing attention to the documents compiled by Mr Percy in the course of his investigation. Reference was made to the decision of the Court of Appeal in Dew v Maher (1996) 14 NSWCCR 56 (Dew) in which the Court considered the consequences of “gross misconduct” in circumstances where the injured worker was not the “prime instigator” of the relevant conduct.
It was put that whilst Mr Campbell was “at work” at the time of injury he was “not engaging in his normal duties at work”. His activities at the relevant time were, it was put, “inherently dangerous”. The gravity of those activities resulted “in the termination of employment”.
Counsel argued that the correct approach to the present facts was that the Commission was to, at first, determine whether Mr Campbell had established that he had received an injury in terms of s 4 of the 1987 Act. The argument against so concluding was that he was conducting himself in such a manner as to take him “outside of the scope of his employment” as was found by the Court of Appeal in Dew.
It was then put that, should there be a finding of injury within the meaning of the Act, the terms of s 9A of the 1987 Act required consideration. It was the appellant’s argument that, having regard to the facts and relevant authority, the conclusion should be reached that employment was not a substantial contributing factor to the injury.
Submissions were put, upon the basis that findings were made in favour of Mr Campbell concerning the application of ss 4 and 9A, that there was no evidence to establish that he was seriously and permanently disabled in terms of s 14(2) of the 1987 Act. That being so, it was argued that his conduct disqualified him from entitlement to payment of compensation.
Counsel for Mr Campbell replied to the argument relevant to s 14(2) by reference to the medical evidence and the decision of McGrath J in Taylor v The Commissioner for Railways [1970] WCR 73 (Taylor). Counsel proceeded to cite a number of authorities in support of the submission that Mr Campbell’s conduct did not constitute serious and wilful misconduct in terms of s 14(2). During argument the term “gross misconduct” was mentioned; however, no submission was put suggesting that that term was synonymous with, or distinguishable from, the concept of “serious and wilful misconduct”.
Counsel returned to the subject of s 9A and placed reliance upon the decision of the Court of Appeal in Badawi v Nexon Asia Pacific Pty Ltd t/as Commander Australia Pty Ltd [2009] NSWCA 324; 75 NSWLR 503 (Badawi). It was put that “attention must be given to the employment concerned, not what the worker was doing at the actual time of injury”. It was further put that “the causal connection between the employment and the injury must be real and of substance”.
The facts concerning the involvement of Mr Kelleher in deciding to cut a larger board and his conduct generally were emphasised in argument, and it was put that Mr Kelleher, the supervisor, “devised the process” leading to injury (at T54).
Further argument concerning the s 74 notices and the question of proof of injury (s 4) occurred following certain questions put to counsel by the Arbitrator. It was in the course of exchanges between counsel and the Arbitrator that it was put by the appellant’s counsel that the term “gross misconduct” is not a “statutory provision”. The argument was put (at T61) that:
“[T]he decision making tribunal has to examine the facts and without attaching labels to it determine whether the circumstances of the conduct leading to the injury was such that it could no longer be said that the, the [sic] worker was in the course of his employment at the time. Or that the injury arose out of the employment. And if he was, if the conduct was such, whether it be labelled as gross or anything else, if the conduct of the worker was such as to be of such an extreme nature that it was, became completely outside the employment contract then the first base is not established as being an injury received arising out of or in the course of the employment.”
The Arbitrator’s decision
The Arbitrator noted the appellant’s denial that “the incident of 18 August 2010 … does not come within the definition of injury under s 4 of the Act”. The Arbitrator also noted that in defence of the claim reliance was placed upon ss 9A and 14.
Between [32] and [37] the Arbitrator considered the authorities relevant to the questions of construction and application of the provisions of s 14. Also considered was the proper means of reading both ss 4 and 14 together. The decisions of the Court of Appeal in Higgins v Galibal Pty Ltd t/as Hotel Nikko Darling Harbour (1998) 45 NSWLR 45 (Higgins); WorkCover Authority of NSW v Walsh [2004] NSWCA 186 (Walsh) and Pollock v Stickfast Labels Pty Ltd [2002] NSWCA 360; 24 NSWCCR 279 (Pollock) were considered.
The Arbitrator proceeded to make a finding (at [38]) that:
“What the appellant [sic, applicant] was doing on the night shift of 18 August was serious and wilful misconduct and/or gross misconduct. I also find that his injuries were solely contributed to by reference to that conduct.”
No express finding was made by the Arbitrator that Mr Campbell had proven that he received injury arising out of or in the course of his employment.
At [39] of Reasons a finding was made that Mr Campbell’s employment was a substantial contributing factor to his injuries.
The Arbitrator found that “[Mr Campbell] comes within the provisions of s 14(2) in that he was engaged in serious and wilful misconduct”. Findings were also made that the serious and wilful misconduct was the sole cause of Mr Campbell’s injuries and that his injuries were “both serious and permanent within the meaning of s 14(2)” (at [40]). These findings are addressed below.
The Arbitrator then proceeded to enter the awards noted at [6] above.
SUBMISSIONS, DISCUSSION AND FINDINGS
This appeal is governed by the provisions of s 352 of the 1998 Act. The nature and scope of such an appeal is as provided by s 352(5):
“(5) An appeal under this section is limited to a determination of whether the decision appealed against was or was not affected by any error of fact, law or discretion, and to the correction of any such error. The appeal is not a review or new hearing.”
The powers of the Commission upon conduct of such an appeal are defined by the provisions of s 352(7):
“(7) On appeal, the decision may be confirmed or may be revoked and a new decision made in its place.
Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.”
Application of s 14 of the 1987 Act
Before addressing the parties’ submissions it is appropriate to consider the approach that must be adopted in the present circumstances where reliance is placed upon the provisions of s 14 of the 1987 Act. It was put by the appellant, as noted at [29] above, that there is a need for the Commission to first determine whether injury as defined in s 4 has been proven before embarking upon a consideration of the relevance and application of the provisions of ss 9A and 14.
The question as to the proper approach was addressed by Neilson J in Stojkovic v Telford Management Pty Ltd (1998) 16 NSWCCR 165 where it was stated (at [48]):
“The first thing to note, however, is that I have been addressed at some length about the applicability of s 14 of the Workers Compensation Act 1987 (the Act). However, it must be borne in mind that it has been settled law in this State since 1956 that before one even turns to s 14, that the worker must prove before then an injury either arising out of or in the course of the applicant’s employment. That was the decision of the Full Court of the Supreme Court of this State in Love v Lysaght Works Pty Ltd [1956] 30 WCR (NSW) 61. See also my judgment in Clyde v New South Wales (1995) 12 NSWCCR 541 at 561.”
The question arose more recently when considered by the Court of Appeal in Scharrer v The Redrock Co Pty Ltd [2010] NSWCA 365; 8 DDCR 243. In that matter Handley AJA expressed the opinion that s 14(1) “applies to an injury defined in s 4” (at [189]) and that:
“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” (at [200]).
In the same case Basten JA (with whom Handley AJA comprised the majority), whilst adopting a different approach to s 14(1) than that expressed by Handley AJA (at [182]), accepted (at [175]), in relation to s 14(2), that:
“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 [worker].”
I note that careful consideration was given to the proper approach to the construction and application of s 14(2) by Priestley JA in Higgins (between 51–58). The views expressed by his Honour differ to the approach adopted by the Courts in the decisions noted above dating from publication of the decision in Love. Notwithstanding the views expressed by his Honour, the authorities just mentioned make it clear, in my view, that in circumstances such as the present it is appropriate first to consider the issue of s 4. Only then, upon the assumption that injury has been established and s 9A is satisfied, is it appropriate to consider s 14(2). I reach this conclusion mindful of the views expressed by Tobias JA in Walsh (between [55]–[63]).
Injury
The appellant submits that the Arbitrator erred in finding that Mr Campbell received injury within the meaning of s 4 of the 1987 Act. That section provides:
“4 Definition of “injury” (cf former s 6 (1))
In this Act:
injury:
(a)means personal injury arising out of or in the course of employment,
(b)includes:
(i)a disease which is contracted by a worker in the course of employment and to which the employment was a contributing factor, and
(ii)the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration, and
(c)does not include (except in the case of a worker employed in or about a mine) a dust disease, as defined by the Workers’ Compensation (Dust Diseases) Act 1942, or the aggravation, acceleration, exacerbation or deterioration of a dust disease, as so defined.”
As earlier mentioned the Arbitrator has not in the course of his Reasons expressly made a finding concerning receipt by Mr Campbell of injury as defined by the Act. His approach appears to have been to consider the application of both s 4 and s 14(2) to determine the question of injury (between [32] and [38]). Findings were made that Mr Campbell’s conduct was “serious and wilful misconduct and /or gross misconduct” and that “his injuries were solely contributed to [sic] by reference to that conduct”. I note that the term “solely contributed to” does not conform to the wording of the section. The Arbitrator thereafter immediately proceeded to consider the operation of s 9A upon the facts.
The appellant correctly draws attention in its submissions to the absence of any express finding of “injury”. It is clear, in my view, that the Arbitrator’s omission was occasioned by the approach adopted by him when dealing with the question of the interaction of ss 4 and 14. It is also plainly obvious that he had been satisfied that injury had been proven.
It is put on this appeal that there were “insufficient reasons to enable the Arbitrator to conclude that the circumstances leading to the occurrence of the injury were sufficient to maintain connection to the employment” (at [2.9.3] of submissions). That submission, it must be said, lacks precision and is unhelpful. To succeed on this appeal the first matter required is that error, as stated in s 352(5) of the 1998 Act, be established. Complaint is made concerning the reasoning of the Arbitrator in a narrative manner and the precise error, whether of law, fact or as to exercise of discretion, is not clearly identified.
I am of the view that the Arbitrator’s reasoning process concerning the question of proof of injury is deficient. His failure to make a relevant finding (injury) is sufficient to establish that he has erred in law. Further, the reasoning as expressed by the Arbitrator does not, in my opinion, reveal the basis upon which he has reached the apparent conclusion that injury had been proven. In the circumstances it is proposed to examine the evidence and arguments raised to determine the correctness or otherwise of the Arbitrator’s apparent conclusion. Only then may it be determined whether any error established has affected the Arbitrator’s decision.
It is reasonably clear that it was argued on behalf of Mr Campbell before the Arbitrator that he had been injured “in the course of” his employment within the meaning of s 4. Mr Campbell was injured upon the appellant’s premises at a time when he was part way through a 12 hour shift. The words “in the course of” as they appear in s 4 have, very generally stated, implied a temporal connection with the employment. However, the authorities establish that an injury received at a place of employment during working hours is not compensable, as was stated by Fullager J in Kavanagh v The Commonwealth (1960) 103 CLR 547 “unless it is sustained while the worker is engaged in the work which he is employed to do or in something incidental to that work” (at 559).
The difficulty which arises in the present matter concerns the Arbitrator’s finding that, at the time of injury, that which was being done by Mr Campbell was “serious and wilful misconduct and/or gross misconduct”. No challenge is made to that finding. It is the appellant’s submission that such conduct “was of such a nature as to take [Mr Campbell] outside the scope of his employment” (at [2.8.2] of submissions). It is argued that Mr Campbell’s conduct had no connection to the employment; involved destruction of the appellant’s property, and involved behaviour that was “inherently dangerous”. The employment, it is argued, had been abandoned (at [4] and [5] of submissions).
In recent decades the superior courts have tended to adopt a more liberal approach to the construction of the words “in the course of employment” than was found in earlier authority (cf Henderson v Commissioner of Railways (WA) (1937) 58 CLR 281 and Humphrey Earl Ltd v Speechley (1951) 84 CLR 126). That is well demonstrated by the decision of the High Court in Hatzimanolis v ANI Corp Ltd (1992) 173 CLR 473 (Hatzimanolis) which concerned a consideration of entitlement to compensation in circumstances where injury was received during an interlude or interval between periods of work.
It is appropriate, given the present facts and the Arbitrator’s finding concerning Mr Campbell’s conduct, to take into consideration the following observation which was made in the course of the joint judgment in Hatzimanolis (at 484, omitting footnotes):
“it should now be accepted that an interval or interlude within an overall period or episode of work occurs within the course of employment if, expressly or impliedly, the employer has induced or encouraged the employee to spend that interval or interlude at a particular place or in a particular way. Furthermore, 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. In determining whether the injury occurred 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’.”
The High Court’s observations concerning gross misconduct above noted were considered by Cole JA in the course of his judgment in Dew where it was stated (at 63):
“It has been held in Tiver Constructions Pty Ltd v Clair (1992) 110 FLR 239 at 246-248 that the High Court is not to be taken as laying down ‘a universal proposition of law that whenever gross misconduct occurs during an interlude between episodes of work, the employee must be outside the course of the employment’. See also Comcare v Mather (1995) 56 FCR 456 at 464. That may be so because the majority in Hatzimanolis concluded their remarks on this topic by stating:
‘In determining whether the injury occurred 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”.’
To that may be added the circumstances attending the gross misconduct.”
It is important to note, as is emphasised by Priestley JA in Higgins, that s 14 was not raised in argument in Dew and was not touched upon by Cole JA (with whom Handley JA and Cohen AJA agreed). The facts in Dew concerned a worker injured by an explosive device or bomb fabricated by him and another worker as they travelled in a vehicle whilst, as found by the Compensation Court and on appeal, in the course of his employment. Cole JA concluded [at 63]:
“Here, in my view, the gross misconduct was in using the employer’s explosives for a purpose entirely foreign to his employment. That acts to remove him from that employment.”
In the present matter, the circumstances at the time of the misconduct which require consideration include:
(a) Mr Campbell was in the middle of his shift at the appellant’s premises and had attended production of a pipe which “was coming out slowly”;
(b) it was a “slow night”;
(c) given the slow production, Mr Campbell and his fellow workers, including his supervisor, had become idle;
(d) his behaviour was not corrected by his supervisor, and
(e) the supervisor participated in the wrongful activities by producing the boards and driving the forklift.
Having regard to each of the circumstances noted above, particularly the fact that the machine which was managed by Mr Campbell was in the process of manufacture, the correct conclusion, in my opinion, is that he remained in the course of his employment. That is so notwithstanding his misconduct as found by the Arbitrator.
It is argued by the appellant that the participation by the supervisor “was not relevant to the engagement by the worker in the activity as all were aware that the leading hand had no authority to organise or permit this activity and that, if discovered, it could well have led to dismissal” (at [2.9.3] of submissions). It must be assumed that this submission suggests error on the part of the Arbitrator in taking into account the supervisors conduct. I have earlier found that the supervisor’s conduct is a circumstance to be taken into account when determining whether Mr Campbell’s conduct took him outside his employment. Such participation by the supervisor may not, alone, be determinative of the question. However, it must be remembered that, “Jeremy Kelleher was a widely respected and experienced supervisor” as noted by Mr Stuart Percy in his investigation report and that the report also records a statement made by Mr Kelleher “I should have stopped it and I don’t know why I didn’t”.
For the reasons above stated, I find on this appeal that Mr Campbell was injured on 18 August 2010 in the course of his employment within the meaning of s 4 of the 1987 Act.
Section 9A
The appellant relies upon the decisions of the Court of Appeal in Badawi and Van Wessem v Entertainment Outlet Pty Ltd [2011] NSWCA 214 (Van Wessem) in support of its submission that the Arbitrator erred in determining that Mr Campbell’s employment was a substantial contributing factor to his injury. The Arbitrator’s finding is to be found at [39] of Reasons where it was stated:
“In my opinion, the employment concerned was a substantial contributing factor to the injuries suffered to [sic, by] [Mr Campbell]. Firstly, he was at work. Secondly, it was during a night shift. Thirdly, he was injured on equipment supplied by the employer. Fourthly, he was engaged in a joint enterprise with his supervisor. All of these things in a substantial way contributed to his employment [sic, injury] and permit him to succeed in this case.”
Section 9A of the 1987 Act provides:
“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):
(a) the time and place of the injury,
(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.
(3) A worker’s employment is not to be regarded as a substantial contributing factor to a worker’s injury merely because of either or both of the following:
(a) the injury arose out of or in the course of, or arose both out of and in the course of, the worker’s employment,
(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 workplace rehabilitation service as referred to in Division 3 of Part 3, or the worker’s death, resulted from the injury.
(4) This section does not apply in respect of an injury to which section 10, 11 or 12 applies.”
The appellant’s argument concerning the proper application of s 9A is to be found at [8] of submissions in support of this appeal. It is put that “the activity engaged in by [Mr Campbell] was not an activity contemplated within the scope of the employment and the causal connection to the employment, as required pursuant to s 9A, was not ‘real and of substance’.” Reference is then made to the decisions in Badawi and Van Wessem. The argument is not otherwise developed in submissions.
The decision in Badawi, as argued correctly by the appellant, makes it clear that “the requirement imposed by s 9A that the ‘employment concerned’ was a ‘substantial contributing factor’ involves a causative element. The language of the provision makes that plain” (at [80] of the judgment of the plurality). Their Honours proceeded to state (at [81]) that “causation is a fact-laden conclusion” and further that it was “not possible and indeed would be incorrect therefore, to lay down a principal which can be applied unbendingly to all cases”. It was following these observations that the plurality considered the then conflict in existing authority and expressed disagreement with certain matters expressed by Mason P in Mercer v ANZ Banking Group Ltd [2000] NSWCA 138; 48 NSWLR 740 (Mercer).
The appellant’s reliance upon the decision in Badawi is in support of the apparent argument that the word “substantial” as it appears in s 9A must be taken in its “ordinary English meaning” and that it is “a word of evaluative concept” (at [82] of the decision of the plurality). Their Honours concluded that it was “not useful to search for or use other terms such as ‘large’, or ‘weighty’, or by way of further example, other concepts such as ‘predominant’.” Their Honours proceeded to state “the ‘proper link’ in the legislative context was a causal connection expressed by the words ‘a substantial contributing factor’, meaning one that was real and of substance”.
The leading judgment in Van Wessem was delivered by Giles JA (with whom Hodgson JA and Handley AJA agreed). His Honour referred to Badawi and summarised the facts of that matter by stating (at [21]):
“the worker went to the snowfields in the course of her employment, part of a sales team seeking business from the manager of the resort. She went skiing with the knowledge and approval of her employer. While she was skiing her supervisor phoned and asked her to return to the resort for business matters. On her way back she fell and was injured. Although it was conceded that the worker had been injured in the course of her employment, the Workers Compensation Commission rejected her claim on the ground that s 9A(1) had not been satisfied.”
It was stated by his Honour, as had been emphasised by the plurality in Badawi that “the relevant causal linkage is between the employment concerned and the injury” (at [36]).
Having regard to those authorities relied upon by the appellant, the present facts require examination to determine the existence or otherwise of a causal link between Mr Campbell’s employment and his injury. Particular matters are set forth in s 9A(2) to be taken into account for the purposes of a determination as to whether the employment concerned was a substantial contributing factor to the injury. The legislature did not intend that list to be exhaustive. The paragraphs relevant to the present facts are, in my view, (a) and (b). I am also of the view that there are other considerations to be taken into account when dealing with the questions raised by a proper application of s 9A.
The time and place of the injury (s 9A(2)(a)) were, as earlier noted, approximately 2.00 am on 18 August 2010, which was mid shift. The injury occurred upon the workplace premises.
The nature of the work performed and the particular tasks of that work (s 9A(2)(b)) concerned managing the production of pipes which involved starting up, adjusting and supervising a pipe manufacturing machine. On the night in question Mr Campbell “had a big pipe on the line and it was coming out slowly” (Mr Campbell’s statement at page 339 of the Application to Resolve a Dispute). It was a slow night as stated by Mr Campbell in evidence and he and his fellow workers were, before the injury, not fully occupied in the performance of their individual tasks.
I consider that there are other matters to be taken into account concerning the existence or otherwise of a causal connection between the employment and the injury and whether the employment was a substantial contributing factor to that injury. Those matters are:
(a) Mr Campbell’s immediate superior, who was present at the relevant time, authorised and encouraged the activity which led to Mr Campbell’s injury, and
(b) Mr Campbell’s employment afforded the occasion for and the means by which the injury befell him. That injury occurred during an activity in which his fellow workers, including his supervisor, participated.
It may be seen that the matters I have enumerated above as being relevant to a proper application of s 9A substantially reflect the matters taken into consideration by the Arbitrator. I am of the opinion that those matters above summarised permitted the conclusion reached by him that Mr Campbell’s employment was a substantial contributing factor to his injury. The appellant’s argument founded upon Badawi and Van Wessem must therefore be rejected.
Section 14(2)
The appellant successfully argued before the Arbitrator that Mr Campbell’s injury was solely attributable to his serious and wilful misconduct in terms of s 14(2) which provides:
“If it is proved that an injury to a worker is solely attributable to the serious and wilful misconduct of the worker, compensation is not payable in respect of that injury, unless the injury results in death or serious and permanent disablement.”
It may be seen that s 14(2) provides that proof of serious and wilful misconduct disqualifies a worker from entitlement to benefits under the act unless it is proven that the injury has resulted in death or serious and permanent disablement. I have earlier concluded that, notwithstanding Mr Campbell’s serious and wilful misconduct, he remained at relevant times in the course of his employment. Given that conclusion, the appellant’s argument which relies upon the decisions in Pollock, Whittingham and Stojkovic must be rejected. The view, as expressed by Ipp JA in Pollock 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” (at [18]) has no relevance to the present facts given my earlier finding.
The Arbitrator’s findings concerning the operation of s 14(2) are to be found at [40] of Reasons:
“I find that the applicant comes within the provisions of s 14(2) in that he was engaged in serious and wilful misconduct. It was solely the cause of his injuries and that his injuries are both serious and permanent. I find that the injuries are serious and permanent based upon the evidence found in the report of Dr Peter Keith in exhibit “B”, where it says:
‘I think Greg’s prognosis is guarded. I believe he will have mild residual brain symptoms. I believe he will suffer from depression for many months or even years.’
Further, that report also refers to ‘initial bilateral haematoma and right temporal lobe contusion from severe head injury’ and, secondly, ‘Greg’s capacity for work is uncertain, both now and in the future. He may need 12 ongoing assessments and reviews of work capacity.’
I also rely upon the decision of Judge McGrath in Taylor v Commissioner for Railways referred to in paragraph 23 above.”
The question that arises on the present facts is whether the appellant is correct to argue that Mr Campbell “has not established that that misconduct [sic, injury] resulted in serious and permanent disablement” at [9] of submissions. I note that this argument is not developed and, in particular, no reference is made in submissions to the evidence concerning the nature of Mr Campbell’s injury and its consequences; nor is there any reference to the reasoning as expressed by the Arbitrator other than a suggestion that his reasons were not “sufficient”. It is, nonetheless, apparent that the Arbitrator has erred in failing to determine whether the subject injury resulted in serious and permanent disablement. His finding, as noted above, does not address the question of “disablement” within the meaning of the section. His reasoning is, in my opinion, deficient. It is proposed to examine the evidence to determine the proper application of s 14(2) and the presence or otherwise of relevant error.
The first matter to note is that the appellant wrongly refers in submissions to the “misconduct” resulting in serious and permanent disablement. The section provides that such disablement, for the proviso to operate in a worker’s favour, must result from the “injury”.
The terms of s 14(2) will permit entitlement to benefits if the evidence establishes that the disablement is both serious and permanent. The section is to be applied to employment situations (per Jacobs JA (with whom Asprey JA and Taylor AJA agreed) in Peters Ice Cream Pty Ltd v Feeney [1970] 3 NSWR 125 at 127 (Feeney)). It was further held in Feeney, concerning the term “disablement” that it “would not be correct to insist upon a finding that all capacity for employment had gone except for a mere chance of obtaining special employment of an unusual kind” (at 127).
The questions raised by a proper construction and application of s 14 (2) were also addressed by Burke J in Gregson v L & MR Dimasi Pty Ltd [2000] NSWCC 47; 20 NSWCCR 520 where it was stated (at [78]):
“In this matter the question becomes whether Mr Gregson suffers a serious and permanent disablement. Does he have a disability, is it serious, is it permanent, does it impinge adversely upon his capacity to work? If all questions were answered in the affirmative then he would satisfy that requirement. The basic question then presenting is the degree of the applicant’s incapacity and losses before a considered answer to those previous questions is available.”
The evidence on this subject is scant. The Arbitrator has in the course of his Reasons placed reliance upon the evidence of Dr Keith whom he quotes (at [40]) from a report dated 14 June 2011, which appears at [78] above.
Mr Campbell has received a brain injury. The initial diagnosis is noted at [15] above. Dr Keith is of the opinion that he will have mild residual brain symptoms. Mr Campbell has not worked since the injury in August 2010, a period of 15 months to date. His difficulties are summarised by Mr Parker, case coordinator at SWBIRS, in his file note dated 19 October 2010, as follows:
“• severely impaired short term memory function
·difficulty processing verbal and written information
·difficulties managing distractions
·‘losing train of thought’
·decreased tolerance and increased frustration toward his partner (Fiona)
·Sensory loss - smell
·Heightened sensitivity to noise
·Decreased appetite”.
There is in evidence a certificate issued by Dr Keith dated 13 May 2011, which states that Mr Campbell “is receiving medical treatment and that, for the period 18 August 2010 to 13 May 2011 inclusive and ongoing for the foreseeable future he will be unfit to continue his usual occupation”.
Having regard to the evidence of Dr Keith and Mr Parker summarised above I am of the opinion that a finding that Mr Campbell’s injury has resulted in serious and permanent disablement should be made on this appeal, and I so find. The consequences of such an injury have, and will continue to have, serious consequences concerning his capacity to work. The failure by the Arbitrator to address the question of “disablement” has not affected his decision on the question concerning s 14(2) and its application to the relevant facts. The appellant’s arguments concerning the section must be rejected.
DECISION
For the reasons stated herein the determination of the Arbitrator as it appears in the Certificate of Determination dated 17 October 2011 is confirmed.
COSTS
The appellant is to pay Mr Campbell’s costs of this appeal.
Kevin O'Grady
Deputy President
10 February 2012
I, PENELOPE FLEMING, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF KEVIN O'GRADY, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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