Kelly v Secretary, Department of Family and Community Services

1. [1]

   BASTEN JA: This appeal concerns a claim for worker's compensation. The applicant, Ms Wendy Kelly, had been, for many years prior to 2012, employed as a disability support worker in what was described as the Department of Ageing, Disability and Home Care. She worked in Orange.

2. [2]

   On 9 January 2012, during the course of her employment, she was required to attend at an address in Orange to collect two residents with intellectual disabilities. Whilst waiting outside the premises, she was approached by a man whom she knew and who also worked in the Department. The man confronted her in a manner she described as aggressive, intimidating and threatening. His behaviour arose out of a conflict between him and Ms Kelly's daughter. In a statement in evidence, Ms Kelly said, "I don't associate with him outside of work hours and I have nothing to do with him. ... I had no reason to be seeing [him] soon or in the future."

3. [3]

   Ms Kelly suffered a psychological injury as a result of the confrontation. It was common ground in proceedings in the Workers Compensation Commission that Ms Kelly was totally incapacitated for work. That incapacity was not, however, permanent: the Court was advised (relevantly to possible relief, it was said) that Ms Kelly was now back at work, although in a part-time capacity.

4. [4]

   Although her employer (the respondent) did not dispute that she had suffered a psychiatric or psychological injury, or that the injury was the result of the encounter, it did dispute that she was entitled to compensation.

5. [5]

   The dispute was first heard by an arbitrator in the Workers Compensation Commission, who held that she was entitled to compensation and, in particular, payments for medical and other expenses under s 60 of the Workers Compensation Act 1987 (NSW). The respondent appealed pursuant to s 352 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ("the 1998 Act"). The appeal was heard by Deputy President O'Grady, who set aside the certificate given by the arbitrator and made an award in favour of the respondent. He concluded that the employment was not a "substantial contributing factor" to the injury, as required by s 9A of the Workers Compensation Act. Ms Kelly sought leave to appeal on the ground that she was aggrieved by a decision of the Deputy President in point of law, pursuant to s 353 of the 1998 Act.

6. [6]

   Leave was sought because, at least initially, those advising the applicant thought that the amount of compensation in dispute was less than $20,000, as a result of which leave was required, pursuant to s 353(4) of the 1998 Act. However, by the time the matter came on for hearing, it was common ground that the amount in dispute was not less than $20,000 and accordingly leave was not required. The matter was, in any event, listed for a concurrent hearing of the leave application and the appeal. There is, in these circumstances, no need to grant leave to appeal, but the applicant (who will be referred to hereafter as "the appellant") should be directed to file the draft notice of appeal contained in the white folder.

Grounds of appeal

1. [7]

   The grounds of appeal as initially formulated challenged, in somewhat convoluted terms, the approach of the Deputy President to the operation of s 9A of the Workers Compensation Act. They did not clearly articulate a question of law which had been erroneously decided by the Deputy President. However, in the course of argument, a legitimate ground was formulated and addressed and it will be convenient to address that issue shortly.

2. [8]

   Almost three months after the filing of the notice of appeal and the summary of argument, the appellant sought to amend to include a fourth ground, which was no doubt intended to identify a true error of law, by alleging that the Deputy President erred in upholding the appeal from the arbitrator in the absence of any error of fact, law or discretion requiring correction. Absent such an error, the Deputy President had no power to intervene: 1998 Act, s 352(5).

3. [9]

   That superficially attractive approach should not be accepted. Once it is alleged that the Deputy President exercised a jurisdiction that was not properly engaged, it might appear that an error of law permitting an appeal to this Court had been identified. However, that conclusion reveals the flaw in the reasoning. The power of the Deputy President to intervene was engaged when he identified an error of fact on the part of the arbitrator. However, it does not follow that if his conclusion in that regard were erroneous it would involve an erroneous decision in point of law, for the purposes of an appeal to this Court. Such a conclusion would circumvent the intention of the restriction on appeals to this Court to points of law. Although it may be reasoned that the error engages a power which has not arisen, such reasoning is erroneous because it fails to identify at which level the error is to be identified. The terms of s 352(5) will be engaged if the Deputy President is satisfied that there has been an error of fact. He may be wrong, but if his error does not involve a point of law, it cannot be corrected by this Court. In the language of administrative law, an error of fact identified by the Deputy President is not a "jurisdictional fact" (the correctness of which must be determined by the reviewing court) but rather a question of fact, the power to identify which is vested in the Deputy President. There is no error of law in erroneously determining a question of fact, the resolution of which is vested in the Commission.

4. [10]

   Accordingly, the new ground 4 did not give rise to any allegation of error in point of law. The proper focus of the appeal was a possible error in identifying the scope and operation of s 9A of the Workers Compensation Act.

Parties

1. [11]

   In the Commission, the employer was somewhat informally identified as "Department of Ageing, Disability and Home Care". That nomenclature was also adopted in this Court. The Department, however, is not a legal entity; further the reference was to a division within a larger department. Ageing, Disability and Home Care is part of the Department of Family and Community Services, which is a department listed in Sch 1, Pt 1 of the Government Sector Employment Act 2013 (NSW). The Secretary of the Department exercises "employer functions" on behalf of the government in relation to employees of the Department: s 26(1). Unless the respondent indicates otherwise, an amended notice of appeal should be filed designating the Secretary, Department of Family and Community Services, as the respondent.

Issue - employment as a "substantial contributing factor"

1. [12]

   The statutory entitlement to compensation from a worker's employer depends upon the worker receiving "an injury": Workers Compensation Act, s 9(1). The term "injury" is defined to mean personal injury "arising out of or in the course of employment": s 4, injury (a). However, s 9A of the Workers Compensation Act relevantly provides as follows:

2. [13]

   It was common ground that the appellant's injury fell within the terms of s 4(1); the dispute was whether her employment was a "substantial contributing factor" to the injury. The respondent's case was that the confrontation which caused the injury, whilst arising (temporally) in the course of her employment, had no other connection with her employment. It arose out of a family matter. Her employment was therefore not a substantial contributing factor to the injury.

3. [14]

   The appellant's case was equally straightforward. She contended that, in all probability, the confrontation would not have occurred at all had she and her aggressor not been brought together by the circumstances of their common employment. That is, her employment was a substantial factor without which the confrontation would not have occurred. On the other hand, the underlying cause of the confrontation, whilst having nothing to do with her employment, was largely irrelevant. On her case, if one worker assaults or harasses another in the course of employment, the personal motivation for the aggression will not preclude the employment being a substantial contributing factor to the resulting injury.

4. [15]

   On the latter view, this was not a case like Zickar v MGH Plastic Industries Pty Ltd [1996] HCA 31; 187 CLR 310. Mr Zickar's cerebral aneurism had ruptured at work, and he had therefore suffered an injury "in the course of" his employment. However, the aneurism not having been caused or aggravated by his employment, the time of the rupture was entirely coincidental and it would not have been possible to say the employment contributed to the injury. In this case, by contrast, the appellant and the aggressor would, in all probability, have had no contact with each other, but for their common employment or, more precisely, the appellant's employment. It was not a case where the claim arose "merely because" the injury occurred in the course of her employment, in the terms of s 9A(3).

Reasoning of Deputy President

1. [16]

   The arbitrator expressed her agreement with the submissions of the appellant's counsel including those as to "the extent of the causal link of the employment to the injury": at par 23. As the Deputy President noted, she had earlier summarised those submissions at par 19 in the following terms, by reference to the relevant paragraphs of s 9A(2).

2. [17]

   The key passages in the conclusions of the arbitrator were as follows:

3. [18]

   The Deputy President summarised the arbitrator's findings at [68]:

4. [19]

   The Deputy President then set out his views, in general terms, as follows:

5. [20]

   The proposition at [70] that "the facts as found do not permit" the conclusion that the employment was a substantial contributing factor to the injury appears to identify an error of law. It was that error which was the subject of more detailed reasoning at [72], set out below. It is not clear whether the proposition at [71], that causation was not evaluated in relation to the family dispute, is correct. The Deputy President correctly acknowledged that there could be more than one substantial cause of an injury. There seems to have been no doubt that the family dispute was the subject matter of the confrontation, without which the confrontation would not have occurred. Little more needed to be said by way of evaluating its causal strength. In any event, the more detailed reasoning of the Deputy President was contained at [72], by reference to the lettered paragraphs in [68], set out at [18] above:

6. [21]

   The Deputy President summarised the errors, at [73], as involving the arbitrator erring in giving "undue weight" to the matters identified at (a), (b), (c) and (e). He also concluded that the "suggested relevance of the Code of Conduct demonstrates than an irrelevant consideration had been taken into account, namely breach of the code in respect of a non-work related matter."

7. [22]

   Having reached conclusions in those terms, it might have been thought that it would be necessary to reassess the application, giving due weight to the relevant matters and excluding the irrelevant consideration. In effect, the Deputy President returned to the proposition that the findings of fact made by the arbitrator did "not permit" an inference that the employment was a substantial contributing factor to the injury: at [74]. He therefore revoked the arbitrator's certificate and made an award in favour of the employer (identified as "the respondent", but presumably meaning the respondent before the arbitrator and not before him). It would appear that he held that no other conclusion was open on the facts.

Grounds of appeal

1. [23]

   In this Court, counsel for the appellant sought to make much of a complaint that the Deputy President had failed to address the nature of "the employment concerned", in order to determine that with which the injury was required to have the defined nexus. The phrase "the employment concerned" is taken from s 9A(1). However, it is difficult to see that there was any substance in this complaint. Indeed, it was the employer who argued that, because the family dispute had nothing to do with the employment in which the appellant was engaged, the employment was therefore not a substantial contributing factor to the injury.

2. [24]

   Rather, the point on which the appeal must succeed or fail must be found in the reasoning of the Deputy President. That analysis involves reference to the facts as found, together with an understanding of the reasoning of the Deputy President, none of which is greatly assisted by reference to authority. Indeed, the starting point as identified by the arbitrator, must be the terms of s 9A. The arbitrator, in an entirely conventional fashion, had regard to each of the matters set out in s 9A(2). Although they are described as "examples of matters to be taken into account", some at least are likely to be material matters in a wide range of cases.

3. [25]

   It will be necessary to identify in due course what the Deputy President meant when he complained that the arbitrator had given "undue weight" to certain matters and what he meant in saying that the findings of fact did "not permit" a conclusion favourable to the appellant with respect to the "substantial contributing factor" test. To the extent that errors are identified in the reasoning of the Deputy President, it will be necessary to consider whether those errors constitute errors of law.

4. [26]

   The first proposition which cannot be supported is that set out at (a), at [20] above, namely, the fact that the appellant and her aggressor were "employed by the same employer and were performing that work at the same location at the relevant time may be seen as causative only in the sense that 'but for' the mutual employment and their presence at Nile Street there would have been no occasion for injury." (Emphasis added.) If the word "only" were omitted, the statement would be uncontestable. However, the word "only" is critical to its meaning: it is intended to diminish the causal link to something less than "substantial". It means, in effect, that the Deputy President would have been satisfied that the employment was a substantial contributing factor only if the subject matter of the dispute was to some extent employment-related.

5. [27]

   The subjective basis of an attack by one co-worker on another, during the course of their common employment may be a relevant factor in some cases, but in many it will not be. An example where it may be relevant is where two workers start a fight at a pub over a dispute unrelated to work, outside work hours, but continue the fight later during work hours. On the other hand, if a worker were sexually assaulted or harassed by a co-worker, the subjective motivation of the aggressor would be of little if any relevance. Where it is the common employment of two workers which leads to the outbreak of aggression in the course of the employment, in circumstances where such an incident would probably not have occurred absent the common employment, the source of the grievance felt by the aggressor is less likely to be relevant and less likely, if relevant, to carry significant weight.

6. [28]

   The Deputy President acted on the basis that there needed to be a substantial causal nexus between the grievance which motivated the aggressor and the nature of the employment of the appellant. That approach involved a restriction on the terms of s 9A which is not found within the language of the provision, nor does it arise by way of reasonable implication. To limit the scope of the inquiry in this way was an error with respect to the proper construction of the statutory requirement. The common employment was not "merely a temporal element", of no substantial causal significance, nor was it correct to dismiss it as only giving rise to causation in the "but for" sense. Accordingly, the errors sought to be identified in paragraphs (a), (b) and (c), set out at [20] above, were based on a wrong construction of the statute.

7. [29]

   It is not clear that the complaint as to paragraph (e) had any separate significance. In summarising her conclusions as to the satisfaction of s 9A, the arbitrator placed no express weight on the "awareness" of the employer of the bad blood between the appellant and her co-worker. It was merely noted as a factor relied on by counsel for the appellant to suggest that steps could have been taken to avoid contact, at paragraph (b), set out at [16] above.

8. [30]

   In his summary of the errors of the arbitrator, the Deputy President referred to the "Code of Conduct" as being an irrelevant consideration: at [72](d), set out at [20] above, and [73]. The Deputy President described it as a "code [which] regulates behaviour of the [employer's] workers." The Deputy President appears to have concluded that the code did not regulate the conduct of workers in relation to a private dispute and was therefore irrelevant. However, the arbitrator had before her a statement of the appellant's supervisor, Mr Franks, acknowledging that the aggressor was in breach of the employer's code of conduct: Arbitrator's reasons, par 16.

9. [31]

   It is a somewhat surprising proposition that an employer would seek to regulate conduct at work, but only in relation to work matters and not in relation to private disputes. In any event, if the employer's own supervisor took the view that the code had a broader role, it cannot have been described as an "irrelevant consideration", in the sense of one which the statute prohibited the arbitrator from taking into account. If, as appears to be the case, the Deputy President so held, that too constituted an error of law.

Conclusions

1. [32]

   As the basis on which the Deputy President set aside the decision of the arbitrator is shown to have been erroneous in point of law, the appeal should be upheld and the determination of the Deputy President set aside.

2. [33]

   There being no suggestion of an alternative basis on which to set aside the decision of the arbitrator, the appeal from her decision should be dismissed. The respondent must pay the appellant's costs in this Court. No submissions were made as to the costs in the Commission.

Orders

1. [34]

   The Court should make the following orders:

2. [35]

   WARD JA: I agree with Basten JA.

3. [36]

   EMMETT JA: This appeal is brought under s 353 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the Management Act). Under s 353(1), a party to any proceedings before the Workers Compensation Commission (the Commission) constituted by a Presidential member may appeal to this Court if the party is aggrieved by a decision of that member in point of law.

4. [37]

   The appellant, Ms Wendy Kelly (Ms Kelly), appeals from a decision of a Deputy President of the Commission made on 25 March 2013. By that decision, the Deputy President exercised the power conferred by s 352 of the Management Act. Under s 352(1), a party to a dispute in connection with a claim for compensation may appeal to the Commission constituted by a Presidential member against a decision made by an arbitrator. Under s 352(5), such an appeal 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. Specifically, such an appeal is not a review or new hearing. The decision of the Deputy President was to revoke orders made in favour of Ms Kelly by an arbitrator on 2 October 2012.

5. [38]

   Ms Kelly has been employed by the respondent, the Secretary, Department of Family and Community Services (the Secretary), for the past 20 years. During the past seven years, her occupation has been that of a disability support worker at a group home located at Orange, New South Wales. On 9 January 2012, Ms Kelly, in the course of her employment, attended premises in Nile Street, Orange, for the purpose of picking up two clients. While waiting outside the premises for the clients to arrive, a co-worker walked towards Ms Kelly. The co-worker was at the premises for work purposes. The co-worker addressed Ms Kelly in an aggressive and intimidating manner because of an incident involving Ms Kelly's daughter, who is also employed by the Secretary. As a result of the conduct of the co-worker, Ms Kelly has suffered psychological injury and has been incapacitated for work.

6. [39]

   It is common ground that the psychological injury suffered by Ms Kelly was an injury for the purposes of the Workers Compensation Act 1987 (NSW) (the Compensation Act) in that it constituted a personal injury arising out of or in the course of her employment by the Secretary within the meaning of s 4 of the Compensation Act. However, under s 9A of the Compensation Act, no compensation is payable in respect of an injury unless the employment concerned was a substantial contributing factor to the injury. The relevant issue before the arbitrator and the Deputy President was whether Ms Kelly's employment by the Secretary was a substantial contributing factor to the psychological injury suffered by her by reason of the incident that occurred on 9 January 2012. The arbitrator concluded that it was. The Deputy President concluded that it was not. Ms Kelly now appeals to this Court.

7. [40]

   By her Amended Notice of Appeal, Ms Kelly asserts that the Deputy President erred in four respects, which may be summarised as follows:

8. [41]

   In her written summary of argument, Ms Kelly formulated the errors of the Deputy President as follows:

9. [42]

   In his reasons, the Deputy President recorded that the Secretary contended that there was error on the part of the arbitrator in the following respects:

10. [43]

    The Secretary contended before the Deputy President that the only evaluative exercise undertaken by the arbitrator, when addressing the requirements of s 9A, concerned the undisputed facts that Ms Kelly and the co-worker were both employed by the Secretary and each was working at the same location when the confrontation took place. The Secretary said that those factors related solely to a temporal connection and did not address any causative element.

11. [44]

    The Deputy President began with the proposition that the arbitrator's finding concerning the employment of Ms Kelly being a substantial contributing factor to her injury was one of fact. The Deputy President observed that the Secretary's arguments did not draw any distinction between suggested error of fact and suggested error of law.

12. [45]

    The Deputy President accepted that there was a causal nexus between the employment and the injury. However, he did not consider that the facts as found permitted a conclusion that the employment was a substantial contributing factor to the injury. While he accepted that the fact of the family dispute was a substantial cause of the injury, he considered that there may be more than one substantial cause in any given factual circumstances.

13. [46]

    The fact of the injury arising out or in the course of the employment is relevant, but not determinative of itself, since both s 4 and s 9A must be satisfied. Section 9A requires that the employment concerned be a substantial contributing factor to the injury. That use of the indefinite article admits of the possibility of other, and possibly non-employment-related, substantial contributing factors. While the strength of the connection between the employment and the injury is the question in issue, the determination of that question is an evaluative one, leaving a broad area for the personal judgment of the fact finder. Being an evaluative matter involving questions of impression and degree, a finding as to relative contributing factors is a finding of fact (Badawi v Nexon Asia Pacific Ltd t/as Commander Australia Pty Ltd [2009] NSWCA 324; 75 NSWLR 503 at [48]).

14. [47]

    I have had the advantage of reading in draft form the proposed reasons of Basten JA. I agree, for the reasons given by his Honour, that there was no error of law in erroneously determining a question of fact, the resolution of which is vested in the Commission. Accordingly, as his Honour concluded, the fourth ground did not give rise to any allegation of error in point of law.

15. [48]

    I also agree with Basten JA, for the reasons given by his Honour, that the Deputy President erred in identifying the scope and operation of s 9A of the Compensation Act. The basis on which the Deputy President set aside the decision of the arbitrator was erroneous in point of law. Since there was no suggestion of any alternative basis upon which the decision of the arbitrator should be set aside, the appeal from that decision should have been dismissed. I agree with the orders proposed by Basten JA.