Comcare v PVYW [2013] HCATrans 114 (10 May 2013)

Last Updated: 14 May 2013

[2013] HCATrans 114

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S8 of 2013

B e t w e e n -

COMCARE

Applicant

and

PVYW

Respondent

Application for special leave to appeal

HAYNE J
GAGELER J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 MAY 2013, AT 11.39 AM

Copyright in the High Court of Australia

MR J.T. GLEESON, SC, Solicitor-General of the Commonwealth of Australia: May it please the Court, I appear with MR A.P. BERGER, for the applicant. (instructed by Sparke Helmore Lawyers)

MR L.T. GREY: May it please the Court, I appear with my learned friend, MR J.P. MRSIC, for the respondent. (instructed by Pappas J Attorney)

HAYNE J: Yes, Mr Solicitor.

MR GLEESON: Your Honours, the question we seek to raise is whether an employee suffers an injury in the course of employment so as to be compensable statutorily if no more than the following is established; the injury was suffered at a time when the employee was at a place where he or she had been induced or encouraged to be by the employer. In other words, leaving aside gross misconduct and the like - - -

HAYNE J: Induced, encouraged, required?

MR GLEESON: Or required, yes, any of those. Leaving aside situations of gross misconduct or intentional injury, if all one has is induced, encouraged or required to be at a place, is there no further inquiry permitted or required by law as to the use which the employee was making of the place, and the relationship between that use and the employment relationship which led to the person being there.

Now, the burden of our application has two aspects to it. The first is that the critical passage in Hatzimanolis, that I will come to in one moment, which was intended to provide certainty and a guiding principle at least in the “area of place” cases, has led to a difficulty and there is a real and substantial issue whether there needs to be – as in Danvers, which was the original place case that Hatzimanolis was capturing – an inquiry into whether the use of the place is the ordinary use, the foreseeable use, the use related to the employment relationship as opposed to any use. That is our first proposition.

HAYNE J: But is that first proposition one that would entail revisiting Hatzimanolis with a view, what, to further elucidation, or with a view to start again? What I am asking is, what do you say, if leave went, you would be asking the Court to do about Hatzimanolis?

MR GLEESON: I would be asking the Court not to start again, but in the critical line, “encouraged to be in a particular place or engage in a particular activity”, the concept of the injury occurring in a particular place would be the concept which Chief Justice Barwick had in mind in Danvers, and which was picked up in Hatzimanolis. Can I just take your Honours to the critical passage in Danvers which we submit raises the point? In the bundle we have provided to your Honours, it is in Danvers [1969] HCA 64; 122 CLR 529 at page 535, where the Chief Justice said:

No doubt even when a workman’s presence at some particular place at or in which he has no duty to perform for his employer is in the circumstances of his employment incident to that employment –

That is, so no doubt if you are there in the place you are expected to be, no doubt –

every injury sustained by him at the place will not be compensable.

Now, the Full Court has said they disagree with that proposition and the Chief Justice goes on to say –

But in this case there is no room for any finding that the deceased at the time of the receipt of his injury was doing any particular thing which caused or contributed to that injury.

And the rest of the paragraph goes on to focus on a concept of use, that if you are doing the very thing at the place which you are encouraged, requested or required to do – in this case, sleep in the van – an injury which suffers through that use, namely the van catching on fire, is in the course of employment. That concept, your Honours, is also picked up by Justice Windeyer, very clearly, we would submit, at page 544 in the last paragraph, which is at page 43 of the bundle.

GAGELER J: Maybe yours.

HAYNE J: Maybe yours. Maybe yours is paginated as well.

MR GLEESON: Sorry, your Honours. An error has occurred, your Honours. Page 44 of that bundle - - -

GAGELER J: You would be saying that Hatzimanolis at page 484, where it cited Danvers at page 537, was not intended to express a principle different from that which emerges elsewhere in Chief Justice Barwick’s judgment.

MR GLEESON: That is our proposition.

GAGELER J: Yes.

MR GLEESON: That is the first of our propositions. The second, your Honours, I merely mention briefly. There has been a submission by

the respondent that our case is not suitable because it is only about what is described as “an unusual set of facts” unlikely to be repeated; if repeated, not likely to cause a problem; if causing a problem, deal with by legislation. That is the effect of it.

All I need to say in response to that is that the case is not simply about a particular form of sexual activity in the hotel room where the employee was expected to be. If one thinks more broadly, what is at the heart of it is an exercise of autonomy by an individual choosing to engage in an activity which primarily is their private affair as to what they do and how they do it. It could be sexual. One can think of other choices of that character, recreational, political and so on, where one simply looks at it and says that is a carrying on of your private life in the way you think appropriate to yourself, and that does not bring it within the course of employment save if you are under the activity limb where that is the activity which the employer has asked you to do. So for that reason, we would say the point is of very grave importance beyond just the so-called unusual set of facts.

HAYNE J: There is no Bill, is there, which has been introduced to make some amendment to the law, has there?

MR GLEESON: I am told not, your Honour, no.

HAYNE J: No. We may be assisted, I think, by hearing from Mr Grey, Mr Solicitor.

MR GLEESON: May it please your Honour.

HAYNE J: Yes, Mr Grey.

MR GREY: Thank you, your Honours. The short point as we see it in this case, your Honours, is that in Hatzimanolis, four Justices of this Court did set out a single two-part test for deciding whether injury occurring during an interval or interlude in a single period of work had been sustained in the course of employment. That test has applied for somewhat more than 20 years. It exists in different forms in each State and Territory and in the federal legislation that we are concerned with here.

And this case is really about one simple question, in our submission; did this Court mean exactly what it said in Hatzimanolis in the test that it set out on page 484, because the test itself is set out with abundant clarity, we would say. I am sure your Honours have already looked at it, but if your Honours were to turn back to that simple passage on page 484, it is difficult to imagine that the Court could have put it any clearer than it did.

I am talking about the passage that starts with the word “Accordingly”, about eight or nine lines down, “Accordingly, it should now be accepted”. It is in language which is declaratory in its nature. It is language which is simple in its expression, and it is clearly setting out two limbs of the test which are connected by the word “or”, not “and”, and it is plainly in our submission meant to be read disjunctively - - -

HAYNE J: But ultimately, it is the statute that governs.

MR GREY: Yes.

HAYNE J: This is not the statute, and it is said that the Court should look again at the exposition of the statute having regard to the facts now thrown up.

MR GREY: Your Honour, we would say that the statute itself, as is clear from the decision in Hatzimanolis, had been the subject of tests which had attempted to relate activities to particular incidents of employment, and that had created the very problem that the Court referred to in Hatzimanolis, that it involved fine distinctions of fact, particularly in relation to attempts to bring activities within the relationship to employment, for example.

The Court referred in Hatzimanolis to the way that cricket cases had been dealt with. There were two cricket cases referred to in that decision, and had been dealt with differently at different times, although the facts remained relatively indistinguishable. It is clear that what the Court was trying to do in Hatzimanolis was to replace the old Henderson/Speechley test with a test that was far more clear, and not likely to give rise to such fictitious attempts to bring matters close to the incident of employment.

One of the things the Court said in Hatzimanolis was when you look at all of the previous cases, you find two things, and one is that if an accident occurs in a place where the employee has been induced or encouraged to be, then generally speaking, liability follows; and similarly, if the injury has occurred in the course of an activity that is induced or encouraged by the employer, then liability follows. Those are the two central tenants that the Court set out in that little passage on page 484 in order to provide the degree of clarity and simplicity, guiding principle, that the Court saw at that time was necessary.

In our submission, the test has stood the test of time for 20 years. The fact that this case has raised some unusual facts, as you have already heard, has not resulted in an amendment to the Act. The wording of the Act itself, that phrase, “arising out of, or in the course of, employment”, of course does not just appear in this Act. It appears in a number of other Acts around Australia where amendments have been made in various ways to restrict the plain words. So, for example, in New South Wales, there is section 9A which makes it far more difficult to bring the kind of facts that we got in this case within the rubric of the statute.

There are other statutes in other States where again the relationship with employment has been statutorily amended, as it were, to bring a much harder test to pass, but when we are dealing with that simple phrase “arising out of” or in this case “in the course of, employment”, the test that has been propounded in Hatzimanolis has been a test which provides that level of clarity and certainty upon which people have built the legislation since then and upon which people have to some extent ordered their affairs.

GAGELER J: At page 9 of the application book in the reasons for decision of the Tribunal, there is a quotation from the Court of Appeal in Watson v Qantas Airways. Is what is stated in that quotation a correct statement of the law, and if it is, is it somehow explained by the peculiar legislation in New South Wales?

MR GREY: Insofar as it refers to Hatzimanolis, it is accurate, but one has to be careful because it is derived from the passage which appears at 485. In our submission, that passage has been misunderstood in some places and misunderstood, with respect, by the applicant, and possibly misunderstood by some judges below. I will come to that in due course, your Honour. Watson v Qantas Airways was a case that was dealing with the peculiarities of the New South Wales legislation, and in particular 9A, which required a substantial contribution in a way that the Federal Act does not, so that these facts would not pass muster, I do not think, under the New South Wales Act, or possibly under the Acts of some other States.

That is a good point to bring your Honours to this so-called tension that arises between the passage on 484 and the passage on 485. On page 485 of Hatzimanolis, which I think is - - -

HAYNE J: We have it.

MR GREY: Yes. Your Honours will see that there is a long passage commencing with a concession made by counsel for ANI, and the concession was that the worker in Hatzimanolis:

would have been in the course of his employment while working at the mine, travelling to and from the mine, eating and sleeping and even enjoying recreational activity at the camp”.

That was a concession that was made on behalf of the employer. We would interpolate there, of course, that in the course of a posting lasting three months, there is every reason to suppose that the recreational activity at the camp would have included sexual activity if the circumstances permitted it, in the absence of any specific prohibition on sexual fraternisation imposed by the company, and there does not appear to be any evidence of that in that case. But it was then said it did not follow that Mr Hatzimanolis would have been:

in the course of his employment “during the whole of the time” that he spent in the Mt. Newman area.

And as your Honours will see, where that is quoted in the judgment at about a third of the way down the page, the word “whole” appears in italics, clearly for emphasis. It was that proposition which was endorsed by the plurality of the Court in Hatzimanolis, and as the Full Court pointed out, Mr Hatzimanolis was not in the camp provided by his employer when he was injured, so that it was therefore necessary to consider whether he was engaged in an activity which had been expressly or impliedly induced by his employer.

In this case, or at least in Hatzimanolis, that is exactly what the Court found, that the activity of going to Wittenoom, being in the vehicle and travelling on that road had been organised on behalf of the employer. So in a sense, it was what was called “a particular way” case, but nonetheless the concession was made, and we submit correctly so, that if you think about the camp, the camp being the particular place, there was no suggestion by the respondent in that case, and the Court appears to have agreed, that there would be no limit on what you could do within the boundaries of the camp provided that there was no wilful or serious – “gross” misconduct was the word used in that Act. The Federal Act talks about serious and wilful misconduct, or self-inflicted injury. Again, that would be another exclusion under the Federal Act.

That presents a boundary around which compensation liability cannot extend. In other words, if you are at the place where your employer has induced you to be during a period when you are not working, then provided that you do not engage in misconduct or self-inflicted injury, then you are covered for compensation liability. We say on the plain words of what the Court said in Hatzimanolis, that is exactly what you would expect to find in this particular case.

If one says that the alleged tension between the passages on 485 and 484 in Hatzimanolis are in fact illusory, or is illusory, then there is no reason why that decision should not be given its full effect. We say that there is really no basis, or insufficient basis should I say, for this Court to revisit Hatzimanolis because of this particular set of facts, given that it has stood the test of time for 20 years, and that no evident problem has been pointed out with it, and no particular amendments have been made to the Federal Act in particular as a result of the width of the language used by the High Court in 1992.

To the extent that lower court decisions have been cited to your Honours, we say they do not provide any basis for departing from the way in which this Court set out the test in Hatzimanolis, and we say it for two reasons. One is we say there is no obvious doubt or confusion about how the lower courts have applied the Hatzimanolis test, except in relation to some possible misunderstandings of that passage on 485 that I have already taken your Honours to. We submit that the Full Court was correct when it said that none of the cases raised below depended on the necessity to show that the employer had encouraged the employee to engage in a particular activity at a particular place. They said that at paragraph 40 at page 60 of the application book.

In its analysis of the lower court cases insofar as they have any relevance to deciding how this Court should proceed, we say that the analysis of the applicant contains a consistent logical flaw, and that flaw is that when a legal test propounded by this Court provides for two independent pathways by which the test could be satisfied, the fact that a lower court finds both pathways are satisfied does not mean that that court was of the view that it was necessary to satisfy both pathways, or that it is in fact necessary to satisfy both pathways. It is the nature of the kinds of facts that we deal with in these sorts of cases that there will often be different ways of looking at the facts, whether as being at a particular place or doing things in a particular way, and there are many cases where both limbs of the test will be satisfied independently.

We can give an easy example of that. If an employee is housed away from home at a country house with a swimming pool within the boundaries of the property, the employee may be expressly or impliedly authorised and encouraged to swim in the pool for relaxation and exercise during non-work hours, so that if the employee is injured diving into the pool on such an occasion, both limbs of the Hatzimanolis test might be satisfied.

There are cases, however, where only one limb of the test has been satisfied. This is not the only time this case has arisen. In the bundle of authorities that have been provided to the Court, there is a reference to a case called Workcover Authority (NSW) v Walling. That is a case where the worker was injured while engaging in an activity which was clearly not authorised by the employer, namely riding a trail bike during an interval or break in his working day in order to impress a young lady who had arrived, and he was injured in the course of showing off to her on this particular little vehicle.

HAYNE J: What is it that we would get out of that decision that bears on whether leave should go?

MR GREY: Only that to the extent that the other side suggests that there is some difficulty applying the test in Hatzimanolis, or there is some novelty in the proposition that is being expounded that it is sufficient to be at the particular place, we would say Walling is a case where that particular proposition was decisive in that case, that is, it was really the place where the injury occurred that was decisive. That did not itself result in an argument brought to this Court that the test deserved to be reconsidered as a result. What I am really saying about this, your Honour, is the test itself has served well for 20 years and there is no particular reason to - - -

HAYNE J: We have that point, I think, Mr Grey.

MR GREY: Yes, thank you, your Honour. My learned friends have also suggested that there would be some kind of inconsistency or contrast with the law applicable during periods of actual work, if the contention which we say the Full Court correctly decided were accepted. Again, our submission is in reality there is no obvious contrast.

In a case where a person suffers a frank injury, that is, not one being the onset of a gradual disease, while at work during work hours, the law is that it is not necessary to demonstrate any causal connection with the employment itself. A simple temporal connection is sufficient. In other words, if the employee is simply at the place of work, whether carrying out duties or available to carry out duties or even standing by and considering whether they are fit enough to carry out duties, that is sufficient to bring the matter within the course of employment if an injury happens.

In interval cases, like this one and like Hatzimanolis, it is a given that the worker is not required to carry out any duties during the relevant interval or interlude, but may nonetheless be required or encouraged or induced to be in a particular place selected by the employer, as was the worker in this case, such as the overnight accommodation in which she was housed. So the temporal connection with that place at the time the injury occurs, we submit, is sufficient, as it would have been if it was working hours, to establish that the injury occurs in the course of employment.

When one looks at this case, your Honours, it is difficult to avoid the conclusion that there has been some moral judgment applied to the behaviour of the worker in this case. If one were to strip the facts of that sort of case and consider something that is much more mundane, such as suppose a male executive goes on a business trip to New York for a month at the request of his employer, takes his wife along at his own expense without specifically asking his employer’s approval, suppose that they stay in a hotel room selected and paid for by the employer, and one night during that month the bed collapses and the executive suffers injury.

We would say there is no rational principle of workers’ compensation law that would justify acceptance of liability if the injury occurred as a result of the bed simply collapsing while the couple were sleeping, it being accepted in most cases that sleeping is an ordinary incident of employment in those sorts of cases, but would deny liability if the bed collapsed while the couple were having sex, even if the sex caused the bed to collapse. You would get down then to a fine distinction, if you like, about whether or not in a long trip, sex was an ordinary incident of an interval/interlude, and in a short trip, it was not - - -

HAYNE J: I think it shows the difficulty of working by example, does it not? The question at stake here is a question of legal principle.

MR GREY: Yes, I accept that, your Honour, and what we are saying is, is that the revisitation of the principle after the careful analysis that was carried out by this Court 20 years ago is not so compelling that it would justify a grant of special leave. Those are my submissions, your Honours.

HAYNE J: Mr Grey, if leave were to go, on what conditions do you say it should be granted?

MR GREY: Your Honour, if it were to go forward on the basis that there was to be, as it were, a fresh review of what the general test should be - - -

HAYNE J: What I have in mind, Mr Grey, is do you seek any condition as to costs. Do you in particular seek a condition that the appellant pay the respondent’s costs in any event and not disturb costs orders below?

MR GREY: Your Honour, I would say that certainly in this Court, we would seek an order of that sort if the Court was minded to allow a general review of what the law should be in relation to in the course of employment. But if the Court were of the view, furthermore your Honours, that - - -

HAYNE J: The reason I ask, Mr Grey, is that at page 80 and earlier in the draft notice of appeal, what is proposed is that each party should bear its own costs - - -

MR GREY: Yes, I understand that, your Honour.

HAYNE J: - - - in this Court.

MR GREY: No, in this Court, your Honour, we would say that if there is going to be a general review and not simply a question of whether

Hatzimanolis itself was correctly applied, then we should have our costs paid.

HAYNE J: Yes. Mr Solicitor, if there were to be a grant, on what conditions should that grant be?

MR GLEESON: They would include the ones we would accept on page 80 at paragraph 40, but they could go further to accept what Mr Grey just asked, which was that we pay their costs of the appeal in any event, which is what he asked for.

HAYNE J: Yes. There will be a grant of leave in this matter on the condition that the appellant pay the respondent’s costs in this Court in any event, and not disturb the costs orders made in favour of the respondent in the courts below.

MR GLEESON: Sorry, your Honour, there is a slight legal problem with that last bit. Because of section 67(1) of the Safety, Rehabilitation and Compensation Act 1988 (Cth), the ordinary rule in the Tribunal is each bear their own costs. There is an exception to that if the party is successful. Could we do this, your Honours? Could we frame in writing an order which gives the fullest protection possible consisting of what is available under section 67?

HAYNE J: What I proposed was that there be no disturbance of any orders that have in fact been made in favour of the respondent. If there are none, there are none, Mr Solicitor.

MR GLEESON: The problem is that Justice Nicholas has made a costs order in favour of the respondent for the Tribunal. That is the one that causes the problem. So your Honours, it would be best if I could provide a minute which captures the point I am raising. The problem arises from page 39 of the application book, but apart from that, the costs will be protected.

HAYNE J: Well, let us understand this - - -

MR GLEESON: The difficulty is with the final phrasing of order 3 on page 39, that we pay the applicant’s costs of the proceedings before the Tribunal.

HAYNE J: Yes.

MR GLEESON: If we were ultimately successful in this appeal, that order would not be the appropriate order to have been made in the Tribunal by reason of section 67(1) of the Act.

HAYNE J: If you are to come here, Mr Solicitor, why should it not be on terms that you not disturb whatever benefits proposed respondent has obtained by orders in the court below?

MR GLEESON: In general, your Honour, I would agree entirely. I am only drawing attention to section 67(1) of the Act.

GAGELER J: You have no ground of appeal that goes to the costs order. You do not complain about that provision of the Act.

MR GLEESON: Could your Honour just pardon me for one moment? I have nothing further to say against what your Honours have suggested.

HAYNE J: There will be a grant of leave on those terms. How long do counsel estimate the matter will take on appeal?

MR GLEESON: Half a day to a day, your Honour.

HAYNE J: Yes, thank you. Counsel may not have been in Court when I drew attention to the fact that their instructing solicitors will be given the directions that govern the filing of submissions since it is possible, even perhaps likely, that this matter will be fixed in the August sittings. Compliance with the timetable is not only expected, but absolutely required.

AT 12.10 PM THE MATTER WAS CONCLUDED