RE: MUSOLINO (NEE ANDERSON) AND WORKCOVER (PORTFOLIO PUBLISHERS PTY LTD)

Determination by Review Officer made on 22nd November, 1991

(Hearings 22nd July, 22nd October, 29th October, 15th November, 1991)

This is the consideration of an application by Mrs Elly Musolino (nee Anderson) as worker under a contract of service with Portfolio Publishers Pty Ltd as employer, for a review pursuant to the Workers' Rehabilitation and Compensation Act, 1986 ("the Act"), of a decision made by WorkCover to reject a claim for compensation on the grounds that the disability did not arise out of or in the course of employment.

The worker attended the hearings and was represented by Mr Tony Rossi on the first occasion and Mr Miles Crawley on the subsequent occasions, both of counsel of Moody Rossi & Co. Her husband, Mr Tony Musolino, attended as an observer and also gave sworn evidence on one occasion. WorkCover was represented initially by Mr Jim Cannon, Claims Officer, and subsequently by Ms Tas Carabelas of counsel of Ross & McCarthy, instructed by Mr Cannon. Sworn evidence was also given by Mr Adrian Penning as a witness for WorkCover.

The major issue in dispute is whether or not the worker had abandoned her employment prior to suffering a disability. The parties asked me to make a preliminary finding on this question, and if I found in the worker's favour, then they may be able to resolve the issue which would arise as a consequence, namely the worker's weekly earnings.

In reaching my preliminary finding I take into account the documents on file, the sworn evidence and submissions presented at the hearings, and the demeanour of the worker and other witnesses.

I find that the worker was employed by the employer as a sales consultant whose responsibility in September, 1990 was to "sell" space in a yet to be published magazine called South Auto Sales Guide. On 13th September, 1990, while walking along North Terrace, Kent Town, the worker was struck by a taxi suffering injuries to her legs, neck and back. She was taken to the Royal Adelaide Hospital by ambulance and received treatment. On 5th October, 1990 the worker completed a notice of disability and claimed for compensation stating that she had received her injuries "whilst walking to work struck by a motor vehicle". The form was accompanied by a certificate of sickness of the same date, signed by Dr Cox, certifying the worker unfit from 13th September, 1990. I note on file a prescribed medical certificate signed by Dr Cox on 10th November, 1990 certifying the worker unfit for work from 13th September, 1990 to 22nd October, 1990, stating that the worker's injuries were consistent with her claim that they were caused by "accident on way to work with taxi".

On 27th February, 1991, WorkCover wrote to the worker advising that her claim had been rejected and giving as reasons:

"The worker's disability did not arise out of or in the course of employment. The worker had terminated her employment on 10th September, 1990 and as such, was not employed at time of accident."

The worker disputed the assertion that she had terminated her employment prior to the accident, and lodged an application for review of the decision. The worker has also commenced proceedings in the Industrial Commission, pursuant to Section 31 of the Industrial Conciliation and Arbitration Act, 1972, claiming that she had been dismissed by the employer effective from 6th September, 1990 and that this dismissal was harsh, unjust or unreasonable. In the summons issued on 12th February, 1991 in relation to those proceedings, a copy of which is before me, the worker states as the grounds upon which her application is made as follows:

"Portfolio Publishers are falsely stating that I voluntarily quit as I am currently applying for WorkCover due to an accident which happened on my way to the office. I was still employed and even negotiated a raise after the accident. There was no indication that they were unhappy with my work. There was every indication that I would resume work at a higher retainer. After one month they requested that I return the client information to help them finalise my area. I did this and then one week later I received a Group Certificate in the mail and received that on the 10th day of November without any form of explanation."

In her sworn evidence the worker said that some time prior to the accident (she could not remember the exact date), she had had a meeting with her immediate boss, David Gall, with her then fiance Tony Musolino present. She said the purpose of the meeting was to discuss her dissatisfaction with her remuneration package, which at that stage was $100 retainer plus 25% commission on sales per week, but that Mr Gall had said that he was not able to do anything about the remuneration and she should take it to Mr Adrian Penning who was an Executive Director of the company. She described the discussion as heated, with raised voices, and said that she walked out of the office, picked up some material from her desk relating to clients from her previous sales work with AMP and left the office. She said her intention was that she was still employed, and said that the following day she had made an appointment to see Mr Penning on 13th September, 1990. She said that in the intervening days she had picked up some art work from dealers who had agreed to contribute to the Auto Sales Guide and was planning to give this material to the employer on the day of her meeting with Mr Penning. She said that the appointment had been made for about 10 o'clock or 10.30 am, but that she had decided to make some visits to prospective clients on the way from her home to the office and said she had rang Mr Penning that morning to say that she would late for that reason. She did not resume duties after the accident because she was incapacitated for work and could not drive. She said that she subsequently arranged a meeting with Mr Penning and that at that meeting he agreed that she would be paid a $300 retainer and 10-15% commission.

Under cross examination Ms Carabelas referred the worker to a record of interview between Mr McCarthy of McKenzie & Associates Pty Ltd, Insurance Loss Adjusters, and the worker conducted on 9th November, 1990. The worker agreed that she had seen the document sometime after its preparation and could not recall finding anything inaccurate in it. She was referred to the statement:

"On Monday 10.9.90 I said that they would have to reorganise the remuneration. I said I wouldn't be able to continue on these terms".

She denied that what she meant was that she would leave the company if she did not get what she wanted, explaining that she meant that she would be financially unable to cope. She agreed that she "stormed out" of the meeting and also agreed that she had taken not only information relating to AMP, but also a sales presentation folder and some personal trophies, but asserted that she had left behind some stationery and pens and calculator, some of which were her personal belongings. She said her remuneration was not discussed with the employer between the time of that meeting and the accident except by telephone with Mr Penning in the evening of the day after the meeting with Mr Gall, when it was agreed that the remuneration would be discussed at her meeting with him on 13th September. She denied being told by Mr Penning that the meeting was to discuss her re-employment. She said that when she rang on the morning of the accident to advise that she would be late she spoke to Michelle Dayman, who put her through to Mr Penning. She said that on the Monday or Tuesday after the accident she had a telephone discussion with Mr Penning regarding her remuneration package, but did not discuss returning to work as she was uncertain when her injuries would heal. She said that she had received no pay for any time after 6th September, 1990 and alleged that she was still owed money for work done. She could not recall who completed her claim form, explaining that she was in bed until the end of October on medication.

Mr Tony Musolino gave sworn evidence which generally confirmed the worker's evidence as to the meeting with Mr Gall. He said the worker did not say anything after the meeting about terminating her services, and that between the date of the meeting and the accident he drove her to various appointments. He could not recall whether he was present when the worker telephoned Mr Penning to say that she would be late and he could not remember whether she had collected pens, stationery, etc from her desk after the meeting or whether the worker telephoned her employer after her accident.

I think that Mr Musolino was doing his best to assist me but the vagueness of his recollection of times, dates and details leads me to conclude that I cannot rely upon him for verification of the worker's evidence.

Mr Adrian Penning gave sworn evidence. He said that after the meeting with Mr Gall he was informed by Mr Gall about the discussion which he understood to have been "heated" and he said that as a consequence he tried to telephone the worker to find out "her side of the story". His impression from Mr Gall had been that the worker "walked out and resigned and had no intention of coming back". He said that after being advised by Mr Gall about the meeting he had looked at the worker's desk and that material belonging to Portfolio, namely, information on clients was not there and that there was only a calendar. He said that he thinks that he made a time for the worker to see him to discuss what had taken place at the meeting but denied that the figures of $300 retainer and 10% commission were ever discussed. He could not recall whether the issue of remuneration generally had been discussed but asserted that in his view the meeting was to find out what had taken place with Mr Gall and what had led up to it, in other words what her dissatisfaction with Portfolio was. He said that she had said to him that the issue at the meeting with Mr Gall had been "blown out of proportion" and she gave him the impression that she wanted to work for the company. He said that on the day of the accident he did not get a personal telephone call or a message, that he can recall, to say that she would be late, but he did receive a phone call later in the day to say that she had been in an accident. He said that there was a discussion after the accident about the remuneration being reorganised to provide for a higher retainer, but could not recall when this was and denied that a figure of $300 was ever discussed. He said that there were sales managers on that amount and it would have been a joke to put a sales representative on that figure. Under cross examination he said that he had telephoned the worker after finding out about the meeting with Mr Gall because he wanted to see if the problems could be solved and she would change her mind because she had good selling abilities.

I think that Mr Penning, who had no particular axe to grind, was doing his best to assist me, but his recollection of matters which are critical to the worker's story was not sufficiently clear for me to rely upon them for an adverse finding as to her credibility. I have no doubt that he genuinely perceived, from the information given to him by Mr Gall and from his perusal of the worker's desk, that she had resigned. I can well imagine how this impression might have persisted even after his telephone conversation with her the following night in which neither party may have made themselves perfectly clear as to the technical status of the employer/employee contract. The only aspect of Mr Penning's evidence which was at odds with that of the worker and which I accept in preference to the worker's was in relation to the issue of her receiving a $300 retainer. The worker may well have raised the matter, but I accept Mr Penning's evidence that he would not have agreed to it. To that extent the worker's statement in the Summons issued through the Industrial Commission that she had "negotiated a raise" is incorrect.

There was no dispute that the worker suffered the accident as described by her, and was incapacitated for work as a result. The questions for determination are whether or not she abandoned her employment on 10th September, 1990, and if she did, whether that abandonment was effective until the date of the accident on 13th September, 1990, such that she was not in the course of employment at the time of that accident, pursuant to Section 30 of the Act, and therefore not entitled to compensation for her disability.

In answering these questions, WorkCover relied on the sworn evidence of Mr Penning and the written evidence of Mr Gall, Mr Hosie and Ms Dayman, all employees of Portfolio Publishing. Ms Carabelas identified apparent inconsistencies between the worker's oral evidence and various evidence in written form, in particular a record of an interview conducted with the worker on 9th November, 1990, and also inconsistencies between the worker's evidence and the unsworn statements of various employees of Portfolio Publishers. There were a number of areas of evidence in which Ms Carabelas asserted that inconsistencies existed which cast doubt on the worker's credibility, in particular:

1. What time she started, or was to start work on the day of the accident.
2. Which businesses she visited prior to the accident.
3. What things she took from her desk after the meeting with Mr Gall, and what she left behind.
4. Whether she telephoned Mr Penning prior to the accident to say she would be later than previously arranged for her meeting with him.
5. Whether any work was done by the worker for the employer between the 10th September and the day of the accident.

Ms Carabelas painted a scenario in which the worker, who was angry with her boss about her level of pay, abandoned her employment but changed her mind a few days later and then reconstructed her story about the work activities and the negotiations on her remuneration. Mr Crawley asserted that the only indicator of resignation might be the removal of material from the worker's desk, but he pointed to the worker's evidence that she had taken her Sales Manual and asserted that this indicated that she intended to continue in employment for she would have no use for it otherwise. To establish her entitlement to compensation, the worker's credibility is paramount. I am required to weigh her evidence against that of Mr Penning and the written evidence of the other employees.

I have already indicated my view of Mr Penning's evidence. I am not confident I can place great weight on the written statements relied on by either party. Mr Hosie and Ms Dayman appear to me to be reporting mainly their understanding of what other people had told them about the worker's alleged abandonment of her employment. The evidence of Mr Gall is not at odds with that of the worker, and he states that both Mr Penning and himself "took it she had terminated", apparently on the basis that she "cleaned out her desk of her and the companies files, and then left the premises". I do not think I can rely on the statement of Mr Batten, which the worker relies on to support her contention that she did some work on the days prior to the accident, because Mr Batten reports contacting the worker by telephone on the day of the accident and the day after to ask her to pick up some art work, but says that he did not find out that she had had an accident until he met her again until 3 weeks later. I do not think I can give any of the written statements sufficient weight to make a finding based on them alone that the worker is not a credible witness. It seems to me that the impression gained by Mr Gall and Mr Penning that the worker had resigned from her job was a reasonable impression to form. Mr Penning's evidence was that he spoke with her the following day about undertaking further work for the employer, and there is no dispute that she was to attend a meeting with him on the morning of the 13th September, 1990. There are some inconsistencies between her sworn evidence and written evidence taken at times closer to the accident, but I do not regard these as substantial enough to warrant an adverse finding as to her credibility. I accept her contention that she did not by her actions intend to resign after the meeting on 10th September, 1990, and that she continued undertaking duties which she regarded as part of her employment between that date and the date of the accident.

Taking all of the evidence into account, I find on the balance of probabilities that the worker did not abandon her employment on 10th September, 1990 but continued in employment and was in the course of employment when she suffered an accident on 13th September, 1990. I will hear the parties further on any dispute which arises as a consequence of my finding as to the appropriate rate of income for the purposes of determining the worker's entitlement to weekly payments of compensation. This hearing is set down for Friday 20th December at 9.45 am. My final determination, including appeal rights, will be issued following the completion of that hearing.