The Star Pty Ltd v Mitchison

Court of Appeal (NSW)|2017-05-11|Before: Beazley P, McColl JA, Payne JA

Background

On 27 March 2012, "Marquee", a new nightclub operated, managed and controlled by The Star Pty Limited (ABN 25 060 510 410) (The Star) located adjacent to the casino complex, held a "soft" opening for the purpose of testing the operation of the nightclub prior to the official opening to the public.
As at 27 March 2012, the respondent was employed as a hotel bellboy at the hotel which was operated by The Star as part of the casino complex.
The "soft" opening was organised by Ms Alexandra Bull, head of the Events Department at The Star, in March 2013. Ms Bull sent an invitation to the various heads of departments at The Star offering them a number of places for guests they each could invite from amongst the employees of The Star in their departments. The invitation sent out on a date which is unclear to the heads of all departments, stated: "MARQUEE THE STAR SYDNEY MOCK SERVICE EVENING TUESDAY 27 MARCH 5-8PM THIS IS YOUR CHANCE TO BE PART OF MARQUEE SYDNEY'S FIRST TEST RUN COMPLIMENTARY BEVERAGES WILL BE SERVED SPACE IS LIMITED, PLEASE RSVP BY THURSDAY 22 MARCH TO: THIS IS STRICTLY A STAFF ONLY EVENT MARQUEE | THE STAR | SYDNEY HARBOURSIDE ENTRY VIA PIRRAMA ROAD PYRMONT MARQUEESYDNEY.COM"

Evidence of the respondent

The only communication from The Star to the respondent about the opening of the nightclub was as described at paragraph [8] above. The respondent was not paid to attend the nightclub. He knew that staff at The Star were invited but did not know that the event was not open to members of the public, nor did he know that it was for employees of The Star only. He believed that the event was intended to provide training for staff working at the nightclub for the grand opening which was to be held a week later. There were security guards at the soft opening but he did not recognise whether or not they were employed by The Star.

Evidence of Ms Bull

Ms Bull, who was head of the Events Department at The Star, gave evidence that she was asked to invite 400 staff to the "soft" opening. She emailed all the general managers of The Star and the heads of department, attaching an invitation and nominating an allocation of guests they could each invite. She said the head of department at the time looking after bellboys was Mr Drew Schlezenger. Ms Bull was unaware whether Mr Schlezenger had spoken to the respondent or had passed on a copy of the flyer he was emailed. Mr Schlezenger did not give evidence. Ms Bull had not heard of an employee of The Star named Raoul.
Ms Bull's evidence was that there were two purposes for the event: first, for new staff of the nightclub to trial their service procedures; and secondly, to allow staff of The Star an opportunity to see inside the new nightclub which was soon to launch.
Ms Bull agreed that it was not a requirement for staff members to attend the opening of the nightclub. Ms Bull was not aware of there being any other encouragement for staff members to attend, apart from issuing the flyer. She stated "[e]ach department looked after their own invitations directly to their staff".

Primary judgment

It was common ground at hearing that the injury had occurred during an interval between two discrete periods of work. The primary judge referred to the principles stated in Hatzimanolis v ANI Corporation Limited (1992) 173 CLR 473; [1992] HCA 21 and Comcare v PVYW (2013) 250 CLR 246; [2013] HCA 41.
The primary judge found that the respondent's injury did not occur whilst the respondent was in the course of his employment, nor did the injury arise out of his employment. In coming to this conclusion, the primary judge placed emphasis on the following findings of fact: 1. the employer did not require the respondent to attend the nightclub opening; 2. the employer had no expectation that the respondent would attend the nightclub opening; and 3. the respondent had no knowledge that the nightclub was owned and operated by his employer.

Leave to appeal

Although the present is an appeal from an interlocutory decision, this application raises a short and sufficiently important point to warrant the grant of leave to appeal.

Application to adduce further evidence

The applicant in its written submissions sought leave to adduce fresh evidence contained in an affidavit of Ms Courtney Therese Lee dated 18 November 2016, however that affidavit was not read on the appeal.
Ground 5 of the draft notice of appeal stated: "5. That there is available evidence additional to the evidence before McLoughlin DCJ, namely the evidence set out in the affidavit of Courtney Therese Lee and sworn on 17 November 2016, which was not available to the applicant at the hearing and which assists in justifying the setting aside of his Honour's judgment on the basis that it confirms that the respondent was aware that the event was for the applicant's staff only."
As Ms Lee's affidavit was not read, ground 5 should be dismissed.

Remaining appeal grounds

The applicant's remaining appeal grounds are: "1. McLoughlin DCJ erred in finding that the respondent's injury did not arise out of and/or was not in the course of his employment with the applicant. 2. McLoughlin DCJ erred in failing to give adequate reasons for finding that the respondent's injury did not arise out of or was not in the course of his employment with the applicant. 3. McLoughlin DCJ erred in failing to consider and determine whether the respondent's injury was in the course of his employment with the applicant. 4. McLoughlin DCJ erred in failing to consider and determine whether the respondent's injury was in the course of his employment with the applicant. … 6. McLoughlin DCJ erred in making findings of fact: (a) McLoughlin DCJ found that the respondent had no knowledge that his attendance at the mock trial had anything to do with his employment, and that he was unaware of any involvement between his employer and the mock trial except for the fact that it was at the premises of the Star where he worked. This was clearly far too broad a finding to have been made on the evidence. It was also inconsistent with his acceptance of the evidence that the respondent had been told that the hotel and casino staff (the applicant's employees) had been invited to attend the mock trial and that it was part of training for the grand opening a week later. (b) McLoughlin DCJ incorrectly found that the respondent did not know that the event was not open to the public. In a statement dated 11 December 2013 (EXH 1) the respondent had stated that on the evening of 27 March 2012 the nightclub had only been fitted out and was not open to the public. (c) McLoughlin DCJ found that the respondent was unaware that the event was for employees only. On the evidence, McLoughlin DCJ should have found that the respondent was unaware [sic] or ought have been aware that the event was for employees only."

Application to amend the notice of motion

At the hearing of the appeal it became clear that the motion filed by the applicant in the District Court was defective in that it identified the only question as being whether the injury to the respondent occurred "in the course of" his employment.
It is clear that the parties and the primary judge had addressed a wider case, including whether the injury was one "arising out of [the respondent's] employment".
Accordingly, senior counsel for the applicant made an application to amend the notice of motion filed in the District Court. The notice of motion in this Court provides as follows: "The applicant seeks the following order: 1. Leave to amend its Notice of Motion, filed in the District Court of Sydney on 30 September 2016 (sic) in the following terms: 1. Pursuant to rule 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) ('UCPR'), the court determine separately from any other question and before any trial, the following: (a) Was the injury to the plaintiff on 27 March 2012 an injury that arose out of his employment with the defendant; and (b) Was the injury to the plaintiff on 27 March 2012 an injury that occurred in the course of his employment with the defendant. 2. In the event the court answers 2(a) or 2(b) in the affirmative, that the proceedings be dismissed, with costs. 3. In the alternative to Orders 2 and 3, the proceeding be dismissed pursuant to rule 13.4 UCPR on the basis that it discloses no reasonable cause of action and/or is an abuse of process. 4. In the alternative to order 4, the whole of the Statement of Claim be struck out pursuant to rule 14.28 of the UCPR. 5. An order that the plaintiff pay the defendant's costs of this motion and the proceedings. 6. Such … order or orders as the court thinks fit."
Ultimately, the respondent did not oppose the making of that amendment. The amendment should be allowed.
After the hearing of the case, the parties made written submissions about this additional aspect of the case, namely whether the respondent's injury was one that "arose out of his employment" with The Star.

Relevant law

It is important first to sketch the statutory background relating to this appeal. The first matter to notice is that, subject to various procedural and substantive restrictions, an injured worker has the right to sue an employer for common law damages. Section 151 of the WCA provides: "151 Common law and other liability preserved This Act does not affect any liability in respect of an injury to a worker that exists independently of this Act, except to the extent that this Act otherwise expressly provides."
The commencement of proceedings seeking common law damages for "work injury damages" is circumscribed in various respects. In particular, a "pre-filing statement" setting out various matters must be filed. Such a statement cannot be served unless various conditions are satisfied. Section 315 of the WIMA states: "315 Requirement for pre-filing statement before commencing court proceedings (1) Before a claimant can commence court proceedings for the recovery of work injury damages, the claimant must serve on the defendant a 'pre-filing statement' setting out such particulars of the claim and the evidence that the claimant will rely on to establish or in support of the claim as the Rules may require. Note : Section 314 prevents a pre-filing statement being served if there is a dispute as to whether the degree of permanent impairment is sufficient for an award of damages. (2) The pre-filing statement cannot be served unless: (a) the person on whom the claim is made wholly disputes liability for the claim, or (b) the person on whom the claim is made has made an offer of settlement to the claimant pursuant to the determination of the claim as and when required by section 281 and 1 month has elapsed since the offer was made, or (c) the person on whom the claim is made has failed to determine the claim as and when required by section 281. Note : The determination of a claim in accordance with section 281 requires the making of a reasonable offer of settlement (if liability is wholly or partly accepted). Failure to make a reasonable offer of settlement constitutes a failure to determine the claim. Section 74 requires notice of a dispute as to liability to be given."
The conduct of proceedings for "work injury damages" is also affected by s 318 of the WIMA which provides: "318 Parties limited to pre-filing statement and defence (1) For the purposes of court proceedings on a claim for work injury damages: (a) the claimant is not entitled to file a statement of claim that is materially different from the proposed statement of claim that formed part of the pre-filing statement served by the claimant, except with leave of the court, and (b) the defendant is not entitled to file a defence that is materially different from any defence served on the claimant in response to the claimant's pre-filing statement within 42 days after service of the pre-filing statement, except with leave of the court, and (c) the defendant is not entitled to file a defence that wholly or partly disputes liability for the claim if the defendant has failed to serve on the claimant a defence to the claim as required by this Division within 42 days after the claimant served the pre-filing statement on the defendant, and (d) a party to the proceedings is not entitled to have any report or other evidence admitted in the proceedings on the party's behalf if the report or other evidence was not disclosed by the party in a pre-filing statement or defence served under this Division, except with leave of the court. (2) The court is not to grant leave under this section unless satisfied that: (a) the material concerned was not reasonably available to the party when the pre-filing statement or defence was served, and (b) the failure to grant leave would substantially prejudice the party's case. (3) The regulations may provide for exceptions to this section."
An important substantive difference between claims for common law damages generally and those relating to the "injury" to a "worker" is that s 151H of the WCA provides that an injured worker is entitled to damages only if the injury results in the death of the worker or a degree of permanent impairment that is at least 15%. There are also important limitations upon the recovery of certain types of damages in the case of common law claims for work injury damages however they are unnecessary to consider for the purposes of this appeal.
Section 151H of the WCA provides: "151H No damages unless permanent impairment of at least 15% (1) No damages may be awarded unless the injury results in the death of the worker or in a degree of permanent impairment of the injured worker that is at least 15%. Note : Section 322 of the 1998 Act provides that the assessment of the degree of permanent impairment is to be made in accordance with Workers Compensation Guidelines. That section also provides that impairments that result from the same injury are to be assessed together. (2) In assessing whether the 15% threshold has been met (that is, whether the degree of permanent impairment resulting from an injury is at least 15%): (a) impairment resulting from physical injury is to be assessed separately from impairment resulting from psychological injury, and (b) in assessing impairment resulting from psychological injury, no regard is to be had to impairment that results from a secondary psychological injury, and (c) the 15% threshold is not met unless the degree of permanent impairment resulting from physical injury is at least 15% or the degree of permanent impairment resulting from psychological injury is at least 15%. Note : This does not prevent an award of damages in respect of both psychological and physical injuries together once the 15% threshold has been met for one or the other. (3) In assessing the degree of permanent impairment that results from a physical injury, no regard is to be had to any impairment or symptoms resulting from a psychological injury. (4) The degree of permanent impairment that results from an injury is to be assessed as provided by this section and Part 7 (Medical assessment) of Chapter 7 of the 1998 Act. (5) In this section: 'psychological injury' includes psychiatric injury. 'secondary psychological injury' means a psychological injury to the extent that it arises as a consequence of, or secondary to, a physical injury."
The critical question in this case is whether the claim made by the respondent is for "work injury damages", which is the precondition to the application of ss 315 and 318, set out above.
Section 250 of the WIMA provides relevantly for the purposes of a common law claim: "250 Interpretation (1) In this Chapter: … 'work injury damages' means damages recoverable from a worker's employer in respect of: (a) an injury to the worker caused by the negligence or other tort of the employer, or (b) the death of the worker resulting from or caused by an injury caused by the negligence or other tort of the employer, whether the damages are recoverable in an action for tort or breach of contract or in any other action, but does not include motor accident damages. … (2) In the definition of 'work injury damages' in subsection (1), a reference to a worker's employer includes a reference to: (a) a person who is vicariously liable for the acts of the employer, and (b) a person for whose acts the employer is vicariously liable."
Section 4 of the WCA provides relevantly: "4 Definition of 'injury' In this Act: … 'injury': (a) means personal injury arising out of or in the course of employment (b) includes a 'disease injury', which means: (i) a disease that is contracted by a worker in the course of employment but only if the employment was the main contributing factor to contracting the disease, and (ii) the aggravation, acceleration, exacerbation or deterioration in the course of employment of any disease, but only if the employment was the main contributing factor to the aggravation, acceleration, exacerbation or deterioration of the disease, 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."
The definition of "injury" under s 4 of the WIMA is in relevantly identical terms: "4 Definitions In this Act: … 'injury' : (a) means a personal injury arising out of or in the course of employment, and (b) includes: (i) a disease contracted by a worker in the course of employment, where the employment was a contributing factor to the disease, or (ii) the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration, but (c) does not include (except in the case of a worker employed in or about a mine): (i) a dust disease, or (ii) the aggravation, acceleration, exacerbation or deterioration of a dust disease."
Accordingly, if the respondent's injury met the description of "work injury damages", being a personal injury "arising out of" or "in the course of" employment as defined in s 4 of the WCA and s 4 of the WIMA, it would be a claim falling within the provisions of ss 315 and 318 of the WIMA.

Applicant's submissions

The applicant submitted that the respondent's injury was suffered in the course of his employment and arose out of his employment, and as such his right to commence common law proceedings against the applicant was restricted by Pt 6 of Ch 7 of the WIMA.
That is, he would only be entitled to bring a claim for work injury damages against his employer if various pre-conditions set out ss 315 and 318 of the WIMA were met (for example, obtaining an assessment of permanent impairment of at least 15%, serving a pre-filing statement and attending a compulsory mediation). It was common ground that the respondent had not complied with these provisions and, as a result, the applicant submitted that the proceedings were not maintainable.
It was common ground that if the respondent's injury was suffered in the course of his employment or arose out of his employment, these proceedings should be dismissed. If, following that dismissal, the respondent intended to seek common law damages from his former employer, The Star, he would then need to commence fresh proceedings after complying with all of the procedural requirements of the WIMA and the WCA.

Course of employment

It was submitted that whether an injury is suffered "in the course of" employment requires consideration of whether at the time he was injured the respondent was doing something that he was reasonably required, expected or authorised to do in order to carry out his duties. That is, a temporal connection is necessary.
The applicant submitted that the respondent's injury was suffered by reference to both an activity and a place: Comcare v PVYW. It was suffered whilst the respondent was attending a "mock service" evening that was being held at his employer's premises. The event was not open to the general public, the respondent had been invited by his employer and only fellow employees attended the event. Further, the main purpose of the evening was to test and trial the new staff and new procedures of the Marquee nightclub that was due to open.
The applicant submitted that the evidence makes it clear that the respondent was actively encouraged to attend the mock service evening by his employer: 1. he was undertaking a task that he had been requested to undertake by his employer, as an employee of The Star; 2. he undertook that task at his employer's premises; and 3. the task was ultimately for his employer's benefit.
The applicant further submitted that while the respondent's motives and beliefs may provide some evidentiary support for the proposition that he was in the course of employment, they do not form part of the relevant test. Rather, the employer determines the course of employment, and thus the characterisation of the occasion depends on an objective assessment of the conduct of persons in authority with the employer: Pioneer Studios Pty Ltd v Hills [2012] NSWCA 324 per Allsop P at [45].
The applicant also relied upon the decisions in Comcare v Adrian John Mather (1995) 56 FCR 456; [1995] FCA 1216 and Kortegast v Williamson [2002] NSWSC 1134.

Arising out of employment

"Arising out of" employment means arising out of the work that the respondent was employed to do and what was incidental to it; that is there must be a causal relationship between the accident and the respondent's employment.
The applicant submitted that the only people who were entitled to enter the Marquee on the evening of the accident were those employed by the applicant. There was no social relationship as such between the Marquee and the respondent and, accordingly, his presence at the evening was referable solely to his employment with the applicant.
The applicant also submitted that given the respondent's accident occurred at an event he was invited to attend by his employer, during a mock fire drill instituted by his employer, it follows that his accident arose out of his employment.
In written submissions in reply filed on 30 May 2017, the applicant emphasised that in Stewart v Metropolitan Water, Sewerage and Drainage Board (1932) 48 CLR 216; [1932] HCA 45, at 224 Gavan Duffy CJ, Evatt J and McTiernan J quoted with approval the statement of Russell LJ in Lawrence v George Matthews (1924) Ltd (1929) 1 KB 1 that "sufficient causal relation or causal connection between the accident and the employment is established if the man's employment brought him to the particular spot where the accident occurred, and the spot in fact turns out to be a dangerous spot". (italics in original)
Further, it was submitted that in Comcare v PVYW, although this issue was not specifically addressed, the hotel room where PVYW's employment had taken her was "not a dangerous spot as such". It was the act of PVYW or her acquaintance that created the danger in an otherwise non-dangerous spot.

Respondent's submissions

The respondent submitted that it was open to the primary judge to find that the injury did not occur in the course of his employment. The respondent made five overlapping submissions about this topic: 1. that the applicant had oversimplified the tests in Hatzimanolis and Comcare v PVYW. The question to be determined involved the notion of remoteness; 2. there was no evidence to suggest that the respondent was undertaking a task requested by his employer as asserted by the applicant. The respondent was not even aware that The Star operated the Marquee; 3. staff were not required or expected to attend the event. Only 400 out of a total of 4,000 staff attended; 4. there was no evidence that The Star encouraged staff to attend. An invitation to attend an event does not amount to encouragement to attend. The evidence regarding the invitation was limited and vague. The respondent gave evidence that he was told by his Bell Captain that the Marquee had invited The Star staff to attend; and 5. the purpose of the event was for new staff at the Marquee to trial their service procedures. There was no evidence to suggest that a collateral purpose of the event was to express gratitude to the staff for service on behalf of The Star or to increase morale amongst staff, or to cultivate a corporate culture.
On 23 May 2017, the respondent filed additional submissions in respect of the issue "arising out of" employment. The respondent submitted that the starting point is to determine whether the activity or task that led to the injury was an activity or task falling within the tasks required by the contract of employment or was incidental to those tasks: Le Brocq v Workcover Authority of NSW [2008] NSWCA 125 at [25]; Hatzimanolis at [8]; Comcare v PVYW at [19] and [25].
The respondent argued that there was no causal connection between the respondent's employment and injury because there was nothing that the applicant did to extend the respondent's hours or conditions of employment.
The respondent relied on the decision of this Court in Pioneer Studios [2012] where an objective assessment of the applicant's conduct (and of persons in authority) and what the applicant did or said so as to extend the work hours or conditions of employment were paramount considerations in determining whether the injury arose out of employment.

An initial observation

The applicant submitted that there was an irony in the present case in that the respondent when injured had immediately claimed and been paid workers compensation.
The present claim for common law damages against his former employer, however, was based upon a foundation that the respondent was not entitled to be paid workers compensation. So much may be accepted.
No doubt those advising the respondent have advised him that if he is successful in obtaining the relief he seeks in these proceedings, he will have established that he was paid workers compensation on the mistaken basis that he was entitled to those payments. The applicant's workers compensation insurer would be entitled at common law to be repaid because of the mistake: David Securities v Commonwealth Bank of Australia (1992) 175 CLR 353; [1992] HCA 48. Whether, prior to obtaining any payment of common law damages, the respondent would have any defence to a claim seeking repayment of the workers compensation he had been paid, cannot be determined in these proceedings: cf Tran v Vo [2017] NSWCA 134.

Was the injury "in the course of" the respondent's employment?

The applicant's case was principally focussed on the submission that the respondent's injury was one suffered in the course of his employment. The applicant's submission that the characterisation of conduct or an occasion as being "in the course of" employment depends on an objective assessment should be accepted. Whether conduct or an occasion is "in the course of" employment depends on an objective characterisation of the employer's requirements and expectations, though with no precise limitation to the contract of employment: Pioneer Studios [2012] per Allsop P at [45]; Pioneer Studios Pty Ltd v Hills [2015] NSWCA 222 per Basten JA at [36].
To determine this question it is necessary to consider the decisions in Hatzimanolis and Comcare v PVYW where the High Court described in detail the meaning of the phrase "in the course of employment".
In Hatzimanolis the Court identified as a striking feature of the cases dealing with an injury to a worker which occurred in an interval between periods of actual work, that "the employer has authorised, encouraged or permitted the employee to spend his time during that interval at a particular place or in a particular way". The Court went on to say at 484: "Moreover, Oliver and the cases which follow it show that an interval or interlude in an overall period or episode of work will ordinarily be seen as being part of the course of employment if the employer, expressly or impliedly, has induced or encouraged the employee to spend the interval or interlude at a particular place or in a particular way. Indeed, the modern cases show that, absent gross misconduct on the part of the employee, an injury occurring during such an interval or interlude will invariably result in a finding that the injury occurred in the course of employment. Accordingly, 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'."
In Comcare v PVYW, where the injury occurred away from the worker's usual place of employment and at a time outside her usual working hours, the Court returned to this question. Critically, for present purposes, the High Court in Comcare v PVYW stated (footnotes omitted): "[35] Because the employer's inducement or encouragement of an employee, to be present at a particular place or to engage in a particular activity, is effectively the source of the employer's liability, the circumstances of the injury must correspond with what the employer induced or encouraged the employee to do. It is to be inferred from the factual conditions stated in Hatzimanolis that for an injury to be in the course of employment, the employee must be doing the very thing that the employer encouraged the employee to do, when the injury occurs. [36] Moreover, it is an unstated but obvious purpose of Hatzimanolis to create a connection between the injury, the circumstances in which it occurred and the employment itself. It achieves that connection by the fact of the employer's inducement or encouragement. Thus, where the circumstances of the injury involve the employee engaging in an activity, the question will be whether the employer induced or encouraged the employee to do so. … [38] The essential enquiry is then: how was the injury brought about? In some cases, the injury will have occurred at and by reference to the place. More commonly, it will have occurred while the employee was engaged in an activity. It is only if and when one of those circumstances is present that the question arising from the Hatzimanolis principle becomes relevant. When an activity was engaged in at the time of injury, the question is: did the employer induce or encourage the employee to engage in that activity? When injury occurs at and by reference to a place, the question is: did the employer induce or encourage the employee to be there? If the answer to the relevant question is affirmative, then the injury will have occurred in the course of employment."
The plurality, French CJ, Hayne, Crennan and Kiefel JJ, went on to conclude (footnotes omitted): "[50] It has earlier been observed that the Hatzimanolis principle, when it is appropriate to be applied, effects a connection between the circumstances in which the employee sustains injury and the employment. The principle may create a temporal element, in the notion of an interval, but it also creates a factual association or connection with the employee's employment. It does so by the fact of the employer's inducement or encouragement. … [52] The relevant connection or association created by the Hatzimanolis principle is between that activity and the employer's encouragement to engage in it. Likewise, when an injury is sustained by an employee at a place and by reference to that place, in the sense earlier discussed, the connection between that circumstance and the employment is provided by the fact that the employer induced or encouraged the employee to be present at that place."
This Court has had occasion to examine these cases in a not dissimilar context in Pioneer Studios [2012] and Pioneer Studios [2015]. The 2012 decision principally addressed the issue of "arising out of employment" and the 2015 decision principally addressed the issue of "in the course of employment".
In the Pioneer Studios cases, Ms Hills had sustained injuries during a social function held after hours at the premises of her employer. A person in authority with the employer had asked whether Ms Hills was attending the function, which the employer was permitting to be held at its premises, albeit that the employer had played no role in organising the function. Ms Hills gave evidence that she understood this enquiry to constitute a direction to attend the function. Relevantly, in respect to whether Ms Hills' invitation to the function could be characterised as encouragement or inducement by her employer within the meaning of those terms described by the High Court in Hatzimanolis and Comcare v PVYW, Basten JA in the [2015] case noted at [29] and [33]: "[29] No doubt an enquiry as to whether an employee intends to attend a party may be treated as encouragement, or even an inducement, whether or not it is so intended. However, it is not conduct of a kind which would be sufficient to turn a party into part of the employee's employment. … [33]…The fact that the respondent was encouraged, or even induced, to attend the party was not sufficient to render it part of her employment."
The legal principles to be applied were distilled by Basten JA at [34]-[35]. His Honour described an important limitation on the scope of the principle and an important distinction between the "camp" cases, where a worker is required by his employment to live away from home for a period, and cases where the worker is engaged for regular hours and goes home after work. His Honour said, at [34] (footnotes omitted): "[34] The 'camp' cases, where the worker is required to find accommodation away from home whilst on the job and such accommodation is provided by the employer, engage the principle in Hatzimanolis, pursuant to which compensation is payable where the worker 'sustained injury during an interval occurring within an overall period or episode of work and while engaged, with his employer's encouragement, in an activity which his employer had organized.' Another case of that kind was Danvers v Commissioner for Railways (NSW) a case upholding a claim by an employee of the Commissioner who died in a fire in a railway van being used by him as an abode whilst working for the Commissioner. As noted by Barwick CJ: 'The course of an employment, to use the language of Dixon J. in Henderson v. Commissioner of Railways (W.A.), includes the doing of 'whatever is incidental to the performance of the work' and will include what he 'is reasonably required, expected or authorized to do in order to carry out his actual duties'. Thus it may include being at a place at which the workman's presence 'is so consequential upon or incidental or ancillary to the employment that in being there he is doing something in virtue, or in pursuance, of his employment'. In applying such a statement to the facts and circumstances of a particular case, its elements, in my opinion, should be applied liberally and practically.'"
The important distinction between the "camp" cases and cases where the worker is engaged for regular hours and goes home after work to which Basten JA referred in Pioneer Studios [2015] at [34]-[35] is described in Hatzimanolis in the joint reasons at 482-483: "…However, it would be an unacceptable extension of the course of employment to hold that an employee was within the course of employment whenever the employer had authorized, encouraged or permitted the employee to spend the time during an interval between periods of actual work at a particular place or in a particular way. That formulation would cover not only the case of the 'lunchtime' injury … and the case of the railway worker, as in Danvers, but also many cases involving injuries occurring during intervals between daily periods of work which could not fairly be regarded as within the course of employment. Thus, an employee who is encouraged by his or her employer to see a doctor after working hours is not ordinarily within the course of employment if injured while visiting the doctor, although the case would come within such a formulation. The course of employment is ordinarily perceived as commencing when the employee starts work in accordance with his or her ordinary or overtime hours of work and as ending when the employee completes his or her ordinary or overtime hours of work. The distinction between an injury sustained by a railway worker as in Danvers and a non-compensable injury sustained by an ordinary employee after the day's work has ceased lies not so much in the employer's attitude to the way the interval between the periods of actual work was spent but in the characterization of the period or periods of work of those employees. For the purposes of workers' compensation law, an injury is more readily seen as occurring in the course of employment when it has been sustained in an interval or interlude occurring within an overall period or episode of work than when it has been sustained in the interval between two discrete periods of work…."
The importance of this distinction is emphasised in Comcare v PVYW at [48]-[49].
In the present case the respondent suffered injury in the interval between two discrete periods of work. The respondent was not working overtime and was not being paid. When the evidence of what the employer required or expected of the respondent is examined, it was limited to that given by Ms Bull, who appears to have been the guiding mind of The Star for this purpose. She gave evidence that there were two purposes of this event: 1. for new staff of the nightclub to trial their service procedures; and 2. to allow staff of The Star an opportunity to see inside the new nightclub soon to launch.
The respondent played no part in this first purpose. He was not employed to trial service procedures at the nightclub. The second purpose, "to allow staff of The Star an opportunity to see inside the new nightclub" did not provide "encouragement" or "inducement" to attend such that the respondent was injured "in the course of" his employment. 4000 staff members of The Star were informed of the "soft" launch and only 400 people attended.
Further, the only evidence of communication by the respondent's employer which might have met the description "inducement" or "encouragement" to be at the nightclub was the Bell Captain Raoul's statement that: "Marquee is doing a test run on Tuesday night in preparation for the big opening. They've invited the hotel and casino staff to attend. There will be free drinks and DJs all night. If any of you isn't rostered to work and want to go, put your names down here on this list."
These matters provide an insufficient basis to conclude that the respondent's injury was suffered in the course of his employment in a case where injury is suffered in the interval between two discrete periods of work.
Neither Comcare v Mather or Kortegast v Williamson lead to any different conclusion. Both cases were decided before Comcare v PVYW and each turned on factual findings absent in this case. Comcare v Mather was a "camp" case. The finding which Kiefel J made was that two soldiers stationed in Darwin had been encouraged by the grant of local leave to participate in drinking and socialising at hotels away from the camp. The circumstances of Mather are distinguishable from the present case. Comcare v Mather was a case relating to an injury sustained "during an interval occurring within an overall period or episode of work." The present is not such a case. In Kortegast v Williamson the owner builder, Mr Williamson had encouraged the injured worker stay behind after work when the day was finished and drink beer with him. The case is clearly distinguishable from the present.
The primary judge was correct to conclude that the injury did not occur in the course of the respondent's employment.

Was the injury one arising out of the respondent's employment?

In Smith v Australian Woollen Mills Ltd (1933) 50 CLR 504; [1933] HCA 60 Starke J, at 517-518, addressed the meaning of the phrase "arising out of" in the then existing workers compensation legislation as follows: "1. The expression 'arising out of' imports some kind of causal relation with the employment, but it does not necessitate direct or physical causation. Was it part of the injured person's employment to hazard, to suffer, or to do that which caused his injury? It must arise out of the work which the worker is employed to do - out of his service (Stewart v. Metropolitan Water, Sewerage and Drainage Board, and the cases there cited). 2. An injury does not cease to arise out of the employment because its remote cause is the ideopathic condition of the injured man. The ideopathic condition must be dissociated from the other facts (Wicks v. Dowell & Co). 3. An injury which arises directly out of circumstances encountered because to encounter them falls within the scope of employment is an injury arising out of the employment. If the worker is injured by contact physically with some part of the place where he works, then, apart from questions of his own misconduct, he at once associates the injury with his employment (Upton v. Great Central Railway Co; Brooker v. Thomas Borthwick & Sons (Aus.) Ltd.)." (Citations omitted)
Starke J's reference to Stewart v Metropolitan Water, Sewerage and Drainage Board was a reference to his own judgment in that case. In Stewart, his Honour explained that it was not sufficient to show that an injury was one "arising out of" employment merely to show that but for the employment, the worker would not have been at the scene of the accident.
The decision of the other members of the majority in Stewart, Gavan Duffy CJ, Evatt J and McTiernan J, at 224, does not assist the applicant. In that decision their Honours explained, in a passage immediately below the one relied upon by the applicant, that for a worker's employment to have "brought him to the particular spot", it was a necessary to conclude that the place was one where the worker, whilst in the course of his employment, may properly and does come. The decision of the other members of the majority is thus consistent with Starke J on this issue.
The applicant's submission that the High Court's decision in Comcare v PVYW is consistent with his submission about an injury "arising out of" employment should also be rejected. The issue was not addressed by the High Court in that case. It would be inconsistent with High Court authority, including Stewart, to conclude that it would be sufficient to show that an injury was one "arising out of" employment merely to show that but for the employment, the worker would not have been at the scene of the accident.
In Badawi v Nexon Asia Pacific Pty Limited trading as Commander Australia Pty Ltd (2009) 75 NSWLR 503; [2009] NSWCA 324, Allsop P, Beazley and McColl JJA at [72]-[79] summarised the relevant principles in determining if an injury is one "arising out of … employment" thus: "[72] Section 4 defines injury as 'personal injury arising out of or in the course of employment'. The use of the disjunctive is significant, in that two quite different tests are involved, one or other of which is sufficient to be satisfied for the purposes of s 9. It is established that the second limb of the definition "in the course of employment" involves a temporal element and does not of itself contain a causative element… [73] The meaning of 'arising out of … employment' is settled. In Nunan v Cockatoo Island Docks & Engineering Co Ltd (1941) 41 SR (NSW) 119 in what is sometimes still referred to as the authoritative decision on the phrase the Court (Jordan CJ and Roper J, Nicholas CJ in Eq agreeing) adopted a common sense approach to the application of the phrase, noting that it involved a causative element. In doing so, their Honours, (at 123), endorsed the comments of Lord Wright in Dover Navigation Co v Craig [1940] AC 190 at 199 that the Workmen's Compensation Act 1925 (UK)Act was a remedial Act intended to give rights to workers that were more extensive than common law rights and which used non-technical language in doing so. As Lord Wright said (at 199): '…Nothing could be simpler than the words 'arising out of and in the course of employment.' It is clear that there are two conditions to be fulfilled. What arises 'in the course' of the employment is to be distinguished from what arises 'out of the employment'. The former words relate to time conditioned by reference to the man's service, the latter to causality. Not every accident which occurs to a man during the time when he is on his employment, that is directly or indirectly engaged on what he is employed to do, gives a claim to compensation unless it also arises out of the employment. Hence the section imports a distinction which it does not define. The language is simple and unqualified.' [74] Their Honours also endorsed the comments of Lord Maugham at 193 in the same case in considering whether the death in that case arose out of applicant's employment: 'The authorities show, if authorities are needed on that point, that the words connote a certain degree of causal relation between the accident and the employment. It is impossible to define in positive terms the degree of that causal connection '. [75] Their Honours concluded (at 124) that a worker would have established that an injury arose out of employment: 'if it appears … that the fact of his being employed in the particular job caused, or to some material extent contributed to, the injury". … [79] The necessity for there to be a causal element between the employment and the injury when determining whether a worker sustained injury arising out of employment, has been consistently confirmed by the High Court and this Court: see Tarry v Warringah Shire Council [1974] 48 WCR (NSW) 1 where Hutley JA endorsed the statements of principle in South Maitland Railways Pty Limited v James (1943) 67 CLR 496; Weston v Great Boulder Gold Mines Limited (1964) 112 CLR 30 and Kavanagh v Commonwealth (1960) 103 CLR 547. This is so regardless of whether s 4 (or its relevant equivalent) under consideration was in its present disjunctive form, or was in its previous form, where both 'arising out of', and 'in the course of' employment had to be established…."
In Pioneer Studios [2012] Allsop P returned to this topic at [27]-[29]: "[27] Secondly, the meaning of 'employment' was discussed in Badawi at 518-519 [61]-[67]. In that discussion at 519 [67], what Mason P said in Mercer at 745 [13] was approved: 'It is common ground between the parties and well established by earlier authority that, when s 9A(1) speaks of 'the employment concerned' being a substantial contributing factor to the injury, the legislation is not referring to the fact of being employed, but to what the worker in fact does in the employment: see Federal Broom Co Pty Ltd v Semlitch (1964) 110 CLR 626 at 632-3, 641. In other words, one starts with the actual and not the hypothetical, with what (if anything) the worker was in fact doing in his or her employment that caused or contributed to the 'injury' as defined in s 4. See also Stanton-Cook [v TAFE Commission (NSW) [1999] NSWCC 5; 17 NSWCCR 632].' [28] The discussion of 'arising out of ... employment' in Badawi at 520-522 [72]-[79] did not qualify that. Indeed, the discussion of the judgment of Starke J in Smith v Australian Woollen Mills Ltd [1933] HCA 60; 50 CLR 504 reinforces it: see Badawi at 521-522 [71]-[78]; and see also Roncevich v Repatriation Commission [2005] HCA 40; 222 CLR 115 at 125 [22]-[25]. [29] In circumstances where it is not expressly concluded that the injury arose in the course of employment and thus where, on this hypothesis, the injured worker was not at work, it is not apparent how the Deputy President could draw any conclusion about the injury arising out of employment or employment being a substantial contributing factor without considering the kinds of matters to which Mason P referred in Mercer at 745 [13]. This is not to confine 'arising out of' to what is required of an employee but rather what she in fact does in the employment. This would require focus upon what was the employment, not what Ms Hills thought was the employment."
Returning to the present case, the question posed is what (if anything) the respondent was in fact doing in his or her employment that caused or contributed to the "injury" as defined in s 4 of the WCA and WIMA.
The submission that the injury suffered by the respondent was not one which "arose out of his employment" should be accepted. The respondent was a bellboy. He was not rostered to work at the time of the incident. He was injured during an interval away from the hotel which was his place of work. He was not required to be at Marquee nightclub at the time of the accident. The respondent went to the applicant's separate premises, the Marquee nightclub not the hotel where he worked, although they are reasonably close by, not to perform work but to drink with colleagues.
A conclusion that the injury was one arising out of employment cannot be drawn. The critical enquiry is what the respondent actually did in his employment. Nothing about what the respondent did as part of his employment caused the injury he suffered on this occasion. Stewart makes clear that it was not sufficient, as the applicant submitted, that the injury was one "arising out of" employment because "but for" the employment, the worker would not have been at the scene of the accident.
The applicant fails in the challenge to the primary judge's finding that the respondent's injury was not one arising out of his employment.

Challenge to factual findings

Ground 6 of the notice of appeal challenged a number of the primary judge's factual findings. No written or oral submissions were addressed to this ground, presumably on the basis that the further evidence on appeal which was foreshadowed was not read.
Ground 6 should be dismissed.

Conclusion and orders

For the foregoing reasons the appeal should be dismissed. The following orders should be made: 1. Leave granted to amend the notice of motion filed by the applicant in the District Court on 30 September 2015 in the form contained in the applicant's notice of motion dated 12 May 2017; 2. Leave to appeal granted; 3. Appeal dismissed; 4. Applicant to pay the respondent's costs of the appeal as agreed or assessed.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 June 2017

headnote [This headnote is not to be read as part of the judgment] The respondent was employed by the applicant as a hotel bellboy. The respondent suffered injuries after work hours when he fell down stairs during a mock fire drill held at the "soft" opening of "Marquee" nightclub. The nightclub was operated, managed and controlled by the applicant. The purpose of the event was to trial service procedures and allow employees of The Star, such as the respondent, an opportunity to see inside the new nightclub before it was opened to the public. The respondent was paid workers compensation in respect of his injuries. He later commenced proceedings for common law damages against the applicant as occupier of the premises. These proceedings are ongoing before the District Court. In an interlocutory decision, the primary judge held that the injury was not one suffered "in the course of" or "arising out of" the respondent's employment, such that his right to commence proceedings for common law damages against the applicant was not restricted by Ch 7, Pt 6 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW). The applicant sought leave to appeal. Held per Payne JA (Beazley P and McColl JA agreeing) granting leave to appeal, but dismissing the appeal with costs: (1) the respondent's attendance at the mock service event, after work hours, was not the result of any encouragement or inducement by the applicant: [74]-[75] Hatzimanolis v ANI Corporation Ltd (1992) 173 CLR 473; [1992] HCA 21; Comcare v PVYW (2013) 250 CLR 246; [2013] HCA 41 applied. Comcare v Adrian John Mather (1995) 56 FCR 456; [1995] FCA 1216; Kortegast v Williamson [2002] NSWSC 1134 distinguished. (2) the respondent's injury was not suffered "in the course of" his employment: [78] (3) the causal connection between the respondent's employment and the injury he suffered at the event necessary to lead to a conclusion that the injury was one "arising out of" his employment was not established: [86]-[87] Smith v The Australian Woollen Mills Ltd (1933) 50 CLR 504; [1933] HCA 60 at 511-512; Badawi v Nexon Asia Pacific Pty Limited trading as Commander Australia Pty Limited (2009) 75 NSWLR 503; [2009] NSWCA 324; Pioneer Studios Pty Ltd v Hills [2012] NSWCA 324 applied. (4) it is not sufficient that "but for" the employment the respondent would not have been at the place of the accident: [87] Stewart v Metropolitan Water, Sewerage and Drainage Board (1932) 48 CLR 216; [1932] HCA 45 applied. (5) the respondent's injury was not one "arising out of" his employment: [88]

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