Australia Meat Holdings Pty Limited v Q-COMP [2007] ICQ 44 (2006) 186 QGIG 527

[Extract from Queensland Government Industrial Gazette, dated 21 September 2007, Vol. 186, No. 7, pages 527-530] INDUSTRIAL COURT OF QUEENSLAND Workers' Compensation and Rehabilitation Act 2003 - s. 561 - appeal against decision of industrial magistrate Australia Meat Holdings Pty Limited AND Q-COMP (C/2007/30) PRESIDENT HALL 13 September 2007 DECISION The Appellant, Australia Meat Holdings Pty Limited, is a self insurer under the Workers' Compensation and Rehabilitation Act 2003 (the Act). On 6 February 2006, Mr Craig Ross Richardson, a boner employed by the Appellant at its Dinmore Meat Works, suffered an injury at work. He sustained a cut to the ulnar nerve in his left hand. His hand was cut when it came into contact with a knife which Mr Richardson was carrying in the pocket of his trousers with the handle pointing downwards towards the floor and with the blade (wrapped in a paper towel) protruding. Mr Richardson had carried the knife in his pocket from the chain to the locker room where he had used a lansky concealed* within his locker to sharpen the knife. [*The hygiene regime established by the relevant regulatory authority did not permit a lansky to be kept within a locker.] It was in returning from his locker to the chain that, as he passed through the water in the boot wash area swinging his left arm, he cut himself. His conduct in carrying the knife in his pocket, rather than in a pouch or a scabbard, was contrary to the Appellant's system of work. The system of work had been drawn to Mr Richardson's attention and, on a number of occasions, he had executed documents indicating that he had read the policy and was aware that he was required to observe it. (There was evidence from Mr Richardson at first instance that, instead of reading the documents provided to him, he had thrown each of the documents into a bin at the first available opportunity.) The Appellant accepted that Mr Richardson had suffered an "injury" within the meaning of s. 32 but declined to accept his claim for compensation. The Appellant relied on s. 130 which provides as follows: "130 Injuries caused by misconduct (1) Compensation is payable for an injury sustained by a worker that is caused by the worker's serious and wilful misconduct only if - (a) the injury results in death; or (b) the insurer considers that the injury could result in a WRI of 50% or more. (2) However, compensation is not payable if the injury could result in a WRI of 50% or more arising from - (a) a psychiatric or psychological injury; or (b) combining a psychiatric or psychological injury and another injury. (3) If the insurer and the worker can not agree that the worker's injury could result in a WRI of 50% or more - (a) the degree of impairment that could be sustained by the worker may be decided only by a medical assessment tribunal; and (b) the insurer must refer the question of the degree of impairment to a tribunal for decision. (4) In this section - "serious and wilful misconduct" of a worker does not include conduct engaged in at the express or implied direction of the worker's employer.". Mr Richardson sought a Statutory Review. By a decision of 11 October 2006, Q-COMP set aside the Appellant's decision to reject Mr Richardson's claim. Q-COMP found that Mr Richardson had suffered an "injury" for the purposes of s. 32 of the Act, decided that the "injury" was caused by conduct which was "wilful misconduct" for the purposes of s. 130(1) but, held that the "wilful misconduct" was not "serious" for the purposes of s. 130(1). Australia Meat Holdings Pty Limited appealed to the Industrial Magistrate at Brisbane. By a decision of 11 April 2007, the Industrial Magistrate dismissed the appeal. The matter before this Court is an appeal against the decision of the Industrial Magistrate. For the purposes of the Appeal to this Court, the Appellant concedes that Mr Richardson suffered an "injury" for the purposes of s. 32. The Respondent concedes that Mr Richardson's conduct was "wilful misconduct" for the purposes of s. 130(1). The concession is not that Mr Richardson's conduct was willed rather than involuntary, but that the conduct was engaged in deliberately and with consciousness of wrongdoing. It is a concession which relieves this Court of the burden of distinguishing between the use of the adjective "intentional" at s. 129, the adjective "wilful" at s. 130(1) and the adjective "deliberate" which was used in the Explanatory Note to the initiative which became the WorkCover Queensland Act 1996 and which contained the forerunner to s. 130 (and s. 129). This Court is concerned only with the issue whether the "wilful misconduct" upon which Mr Richardson chose to engage is properly characterised as "serious misconduct". In embarking upon that task, the Court is assisted by the circumstance that the parties are ad idem that in the expression "serious and wilful misconduct" the word "and" is used in a conjunctive and not disjunctive sense. It is also conceded by Counsel for the Appellant that the language precludes any argument that "wilful misconduct" is always "serious -- 1 of 3 -- 2 misconduct". Counsel maintain, in my view correctly, that the circumstance that misconduct is "wilful" may be taken into account in weighing its "seriousness". The expression "serious and wilful misconduct" and the rival expression "serious or wilful misconduct" have been much considered in employment-related litigation and in particular in connection with disentitlement to workers' compensation benefits for over a hundred years, see e.g. Johnson v Marshall, Sons and Co Ltd [1906] AC 409. Each of the words "serious", "wilful" and "misconduct" is capable of bearing different shades of meaning, Australasian Meat Industry Employees Union v Australian Meat Holdings Pty Ltd [1999] FCA 96 at paragraph 87 per Dowsett J. In the present context, notwithstanding that the adjective "serious" is used to describe the misconduct and is not used with reference to consequences of the misconduct, it seems to be settled that the seriousness of the misconduct is to be evaluated having regard to whether the conduct would be attended by the risk of non-trivial injury, see Johnson v Marshall, Sons and Co Ltd, ibid, at 416. I do not, however, accept the proposition contended for by the Industrial Magistrate in reliance upon the decision of Green CJ in Hills v Brambles Holdings Ltd (1987) 4 ANZ Insurance Cases 60-785, that for conduct to amount to serious and wilful misconduct, it must "be such as to give rise to immediate risk of serious injury.". I respectfully adopt the view of Finn J in Comcare v Calipari [2001] FCA 1534 at paragraph 4, where His Honour said of the quoted passage: "This usage is unexceptional if it is understood as signifying no more than the converse of trivial injury. It was intended to signify more than that and apostolate a positive requirement, it can find no justification in the terms of the statute itself, nor in the general run of authoritive expositions of the formula.". Neither do I accept that a claimant worker is disentitled to workers' compensation benefits only where the evidence shows that the worker had "knowledge of the risk of injury and, in the light of that knowledge, proceeded without regard to the risk", see Sawle v Macadamia Processing Co Pty Ltd (1999) 18 NSWCCR 109 at paragraph 24 per O'Meally J. The requirement that the misconduct must be "wilful" adequately protects injured workers who might otherwise lose everything because of a momentary lapse into carelessness. It is a statutory gloss to go beyond weighing wilful risk taking in the balance and to confine s. 130 to such cases. For the same reason, I also reject the proposition of Green CJ in Hills v Brambles Holding Ltd (1987) 4 ANZ Insurances Cases 60-785, that the defence is available only where the misconduct is "accompanied by an appreciation of the risk which is involved in it.". The preferable approach is that of Derrington J in Boral Resources (QLD) Pty Ltd v Pyke [1992] QdR 25 at 43, that the "necessary knowledge and appreciation need not descend to particularity" and that an "appreciation of possible danger or of factors which might enlarge it" may be sufficient to justify characterisation of the "wilful misconduct" as "serious". Beyond those observations, it seems to me that the relatively simple language of s. 130 should not be overlayed with gloss and the question whether "misconduct" is to be characterised as "serious" should be dealt with as a jury question, compare Boral Resources (QLD) Pty Ltd v Pyke [1992] 2QdR 25 at 33 per Thomas J. For completeness, it is not suggested that because the issue of "seriousness" is to be treated as a jury question, it follows that the decision of an Industrial Magistrate upon that question is to be treated as the decision of a jury. The Appeal at s. 561(3) of the Workers' Compensation and Rehabilitation Act 2003, is described as an appeal "by way of rehearing on the evidence and proceedings before the Industrial Magistrate.". Such an appeal has been traditionally treated as an appeal by way of rehearing in the Warren v Coombes (1979) 142 CLR 531 sense. Characterisation of the essential question as a "jury question" does not reinvigorate Da Costa v Cockburne Salvage and Trading Pty Ltd (1970) 124 CLR 192 and Edwards v Noble (1971) 125 CLR 296. The thrust of the Industrial Magistrate's decision appears sufficiently from paragraphs 42 to 45 of the decision. Paragraphs 42 to 45, which are headed "Decision" are in the following terms: "42. Decision: Mr Richardson's conduct must be assessed in all the surrounding circumstances, in the context of his employment, in terms of the risk taken, the type of injury that might occur, the state of mind of the worker as to those matters, and because the misconduct is constituted by definition, namely a breach of policy, the extent to which that policy was known and understood by the worker. It cannot be said that he was working conscientiously, indeed he was careless in his approach to workplace safety and hygiene issues, devising his own system of work. Mr Richardson acted other than for his own convenience, and not with the motive of assisting his employer by saving time. There was a requirement to carry a knife in a pouch, by no one set process for sharpening knives. Carrying of a knife in a pocket was accompanied by risk of serious injury. Mr Richardson did not perceive that to be a significant risk to him or his co-workers, and said he and others often carried knives in this way because it was easy. Mr Richardson took little notice of company safety policy. 43. Green CJ (see paragraph 37 above) says 'For conduct to amount to serious and wilful misconduct it must be such as to give rise to an immediate risk of serious injury, it must be deliberate and not merely a thoughtless act done on the spur of the moment and it must be accompanied by an appreciation of the risk which is involved in it.' 44. Mr Richardson is a boner in a meatworks. The risks associated with knives must be assessed in that environment. Mr Richardson handles knives as an integral part of his work. He recognized there was a risk associated with -- 2 of 3 -- 3 carrying a knife out of a pouch, but did not recognize that as a real or immediate risk. His repetition of the conduct without resultant harm contributed to his complacency. The inconsistent enforcement of compliance with workplace safety procedures, and lack of clear systems for sharpening knives and carrying more than one knife contributed to his perception, notwithstanding the repetitious production of written task descriptions, signed for by Mr Richardson, but not ready by him. 45. In those circumstances the appellant does not discharge its burden of proving that the misconduct the subject of the appeal is serious as well as wilful. The appeal is dismissed.". The sentence, "Mr Richardson acted other than for his own convenience, and not with the motive of assisting his employer by saving time" is plainly infelicitous. It is common ground that the words "other than" should be substituted by "only". Again, the expression "in those circumstances" at paragraph 45 could be taken to refer either to the summary at paragraph 44 or to the whole of paragraphs 42 to 44. Given the use of the language "Mr Richardson's conduct must be assessed in all the surrounding circumstances" at paragraph 42, seems to me that the reference was intended to be a reference to the whole of paragraphs 42 to 44. I accept that the Appeal at s. 561 of the Workers' Compensation and Rehabilitation Act 2003, is about the correction of error. Compare Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission and Others (2000) 203 CLR 194 at 204 per Gleeson CJ, Gaudron and Hayne JJ. I also accept that there is room for legitimate difference of opinion about whether "wilful misconduct" is properly characterised as "serious" and that in consequence an appeal by way of rehearing on a Warren v Coombes (1979) 142 CLR 531 basis, may come to resemble an appeal against the exercise of discretion. However, I have formed an intractable view that the decision of the Industrial Magistrate was incorrect. It was not the evidence that whilst Mr Richardson "recognised there was risk associated with carrying a knife out of a pouch, [he] did not recognise that as a real or immediate risk", as the Industrial Magistrate found at paragraph 20, "He was aware of the risk of injury from a knife, and took the precaution in wrapping the blade in paper.". So far from failing to perceive that carrying a knife in a pocket posed a significant risk to himself, Mr Richardson recognised such a risk and had it at the forefront of his mind. If one delves into the transcript, the very reason which he gave for carrying the knife handle down and blade up was that if he carried the knife with the handle up and the tip pointing down the knife would pass through his pocket and cut his leg. The proposition that there was "inconsistent enforcement of compliance with workplace safety procedures" is a reference to evidence by Mr Richardson that he would take steps to conceal a knife in his pocket within the presence of a supervisor likely to "get up him" if the supervisor saw the knife in his pocket. The circumstance that some supervisors failed to discharge their responsibilities by enforcing the employer's system of work does not support a finding that Mr Richardson was unsure whether the employer's system of work was a "paper" policy or a real policy. Indeed, such a finding would be inconsistent with the conclusion that there was "wilful misconduct" rather than "willed misconduct". I accept that Mr Richardson was complacent. However, Mr Richardson was not complacent about the risk posed by the blade of the knife. Because of past success in carrying the knife in his pocket, he had become complacent about his capacity to manage the risk. Complacency of that type goes to the seriousness of the failure to observe the employer's system of work. Employers are required to develop systems of work which will safeguard not only the cautious and the alert, but the foolhardy and the distracted. Such systems may well be tedious and time consuming or as Mr Richardson would have it "inconvenient". The temptation of a more convenient course is no excuse. There is also the consideration that too little weight seems to have been given to the risk posed to fellow workers who, with Mr Richardson, were crowding through the boot wash area at about the same time at the conclusion of the lap break. No weight was given to the breach of hygiene requirements in the use of the lansky and in failing to sterilise the knife. In my view Mr Richardson's claim was one for rejection. I allow the Appeal. I set aside the decision of the Industrial Magistrate. I set aside the decision of Q-COMP of 11 October 2006 and in lieu thereof substitute a decision that Mr Richardson's claim was one for rejection. By its application to appeal, the Appellant seeks the costs of and incidental to the hearing of the Appeal. I doubt that the Court has the power to make such an Order but as a matter of prudence, and because there may be issues about the matter of costs at first instance, I reserve the question of costs. Dated 13 September 2007. D.R. HALL, President. Released: 13 September 2007 Appearances: Mr A.K. Herbert, directly instructed by Ms K. Foulds of Australia Meat Holdings Pty Limited, for the Appellant. Mr S. Sapsford, directly instructed for the Respondent. Government Printer, Queensland The State of Queensland 2007. -- 3 of 3 --