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Nebraska Advance She

291 Nebraska Report

JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

John Jacobitz, appellee, v. Auro

Cooperative, appellan

___ N.W.2d ___

Filed July 10, 2015. No. S-14-903.

1. Workers’ Compensation: Appeal and Error. An appellate court is 

obligated in workers’ compensation cases to make its own determinations as to questions of law.

2. ____: ____. Upon appellate review, the findings of fact made by the trial 

judge of the compensation court have the effect of a jury verdict and 

will not be disturbed unless clearly wrong.

3. ____: ____. Pursuant to Neb. Rev. Stat. § 48-185 (Cum. Supp. 2014), 

an appellate court may modify, reverse, or set aside a Workers’ 

Compensation Court decision only when (1) the compensation court 

acted without or in excess of its powers; (2) the judgment, order, or 

award was procured by fraud; (3) there is no sufficient competent evidence in the record to warrant the making of the order, judgment, or 

award; or (4) the findings of fact by the compensation court do not support the order or award.

4. Workers’ Compensation: Proof. In a workers’ compensation case, the 

claimant must establish that the injury for which compensation is sought 

arose out of and in the course of employment.

5. Workers’ Compensation: Employer and Employee. Recreational or 

social activities are within the course of employment when (1) they 

occur on the premises during a lunch or recreation period as a regular incident of the employment; or (2) the employer, by expressly or 

impliedly requiring participation, or by making the activity part of 

the services of an employee, brings the activity within the orbit of 

the employment; or (3) the employer derives substantial direct benefit from the activity beyond the intangible value of improvement in 

employee health and morale that is common to all kinds of recreation 

and social life.
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291 Nebraska Report

JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

Appeal from the Workers’ Compensation Court: J. Michael

Fitzgerald, Judge. Reversed and remanded for further 

proceedings.

Patrick R. Guinan, of Erickson & Sederstrom, P.C., for 

appellant.

Jacob M. Steinkemper, of Steinkemper Law, P.C., L.L.O., 

for appellee.

Heavican, C.J., Wright, Connolly, Stephan, M

Miller-Lerman, and Cassel,

McCormack, 

NATURE OF CASE

John Jacobitz was injured when he fell off a truck following a customer appreciation supper for his employer, Aurora 

Cooperative (the Co-op). The dispute is whether Jacobitz’ 

injury occurred in the scope and course of employment, thus 

making the Co-op liable for the injury. The Nebraska Workers’ 

Compensation Court found that Jacobitz was injured in the 

course of his employment. The Co-op appeals.

BACKGROUND

Customer Appreciation S

The Co-op owns grain elevators in various locations in 

southeast and south central Nebraska. The location in Ong, 

Nebraska, is one of the Co-op’s elevators, which buys and sells 

grain, and sells seed, fertilizer, and other chemicals such as 

herbicides and insecticides.

On August 20, 2010, the Co-op in Ong held a customer 

appreciation supper. The supper was organized by Jerry 

Overturf, the location agronomy manager of the Ong location. 

Overturf planned the supper with the permission of his supervisor, the Co-op’s area manager. Overturf invited farmers that 

had done business with the Ong location in the previous year. 

The purpose of the supper was to thank the Ong location’s 

customers for their business during the previous year.
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JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

The Ong location sent a total of 17 invitations to customers. 

The invitation was printed on company letterhead on a onepage flyer that was folded, addressed, and mailed.

The Ong location’s vendors sponsored the supper and paid 

for all of the food and drinks that were served. One of the 

vendors, Kruger Seeds, also provided a large smoker to cook 

the meat that was served. The smoker was mounted on a trailer 

and had to be towed behind a vehicle. Overturf towed and 

parked the smoker at the Ong Community Building prior to the 

supper on August 20, 2010.

The Co-op scheduled the supper to begin at 6 p.m. The supper was held at the Ong Community Building, which is located 

on Main Street in Ong. Food began to be served at 6 p.m., 

when the guests began to arrive. Approximately 12 farmers 

and their spouses attended the supper.

Six employees from the Ong location were invited to the 

supper. These Co-op employees include Dennis Hansen, the 

location grain manager; Rick Johnson, the sprayer operator; 

Dan Eberhardt, a general laborer; Bill Mountford, the facility 

operator; Karen Corliss, a secretary; and Jacobitz, a general 

laborer. Overturf testified that he invited the employees to the 

supper for “[m]orale,” but that attendance was not required and 

he did not take attendance to determine who appeared and who 

did not appear.

All of the employees of the Ong location attended the supper 

except for Mountford and Corliss. Employees were not compensated for attending the supper. None of the employees who 

attended were asked to help or actually helped serve the food. 

Neither were the employees asked to help clean up. However, 

Hansen, the other manager in attendance, did help to transport 

meat from the smoker to the buffet line.

Jacobitz

Jacobitz began employment with the Co-op in 2010 as a 

general laborer. The Co-op classified Jacobitz as a temporary 

part-time worker.
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291 Nebraska Report

JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

Jacobitz delivered the event invitations for the supper to 

the post office during his work hours. Jacobitz and Hansen 

helped set up for the supper during work hours by setting 

up tables and putting on table coverings in the community building.

There was conflicting testimony regarding how Overturf 

invited Jacobitz to the supper. But, Jacobitz recalled that 

Overturf told him it was to Jacobitz’ benefit to be there. 

Jacobitz testified that he recalled Overturf telling him to 

“[g]o home, clean up, [and] head back” and “[n]eed your 

help.” When asked what his perception of his responsibility was to be at the party, Jacobitz answered, “I didn’t know 

. . . the trouble I would get into for not showing up.” Further, 

Jacobitz answered that he went to the function as part of his 

job. Overturf testified that the employees “were told they could 

attend; I did not ask them to attend.” In regard to Jacobitz in 

particular, Overturf testified that “[Jacobitz] was told the supper was going on; he was welcome to come eat and was not 

required to be there.”

Jacobitz clocked out of work at approximately 5:05 p.m. 

the evening of the supper. At the time, Jacobitz lived about 30 

miles from the Ong location. Jacobitz testified that he drove 

home that evening after work, cleaned up, played with his 

children, and drove back to the Ong location for the supper.

When he returned, Jacobitz did not assist in preparing the 

food, did not serve the food, and did not help clean up at 

the community building. Overturf testified that he did not 

observe Jacobitz talking with any of the farmers or customers 

at the supper. However, on redirect, Overturf admitted that 

he was outside the building while he was cooking, so he did 

not specifically see what was going on inside at the supper. 

Johnson spoke with many or all of the customers present at 

the supper “just to be friendly,” but did not testify whether 

Jacobitz had spoken with any customers. Due to his injuries, 

Jacobitz does not have a clear memory of his own activities 

at the supper.
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JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

Accide

Overturf finished cooking by 7 p.m. Overturf shut down the 

smoker, retrieved his personal truck, and attached the smoker 

to his truck so that he could tow the smoker to storage. Hansen 

and Jacobitz walked over to Overturf as he was hooking the 

smoker to his truck. Neither Hansen nor Jacobitz helped to 

hook the smoker to Overturf’s truck.

Overturf towed the smoker over to a fire hydrant to wash out 

the smoker. Hansen and Jacobitz walked, following Overturf 

to the fire hydrant. After Overturf turned on the hose, Overturf 

handed the hose to Jacobitz so that Overturf could pull a log 

out of the firebox. Jacobitz then sprayed the log as it was lying 

on the ground and washed out the firebox.

Overturf then drove the smoker a short distance to a shed 

located on the Co-op’s property, where he intended to store 

the smoker until the Kruger Seeds’ representative could pick 

the smoker up. Hansen and Jacobitz walked to the shed and 

met Overturf there. Hansen opened the shed door, and Overturf 

backed the smoker into the shed, unhooked the smoker, and 

drove his truck back out of the shed.

Overturf testified that as he drove his truck out of the shed, 

Jacobitz stated to Hansen that he was going to ride back to the 

community building and jumped onto the bed of Overturf’s 

truck. However, Hansen testified that when Overturf drove 

his truck out of the shed, “[Jacobitz] was riding in the back of 

the pickup, and they said [Hansen] could ride along.” Hansen 

declined the offer to ride because he needed to throw some 

trash from the party into the Dumpster. Overturf drove to Main 

Street, took a right onto Main Street, and proceeded to the 

community building, which was about a block away on the left. 

As he drove, Overturf noticed out of his rearview mirror that 

Jacobitz was lying in the middle of Main Street.

Jacobitz sustained head injuries as a result of his fall from 

Overturf’s truck. No one knows how Jacobitz fell out of 

the truck, and Jacobitz does not remember how he fell from 

the truck.
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291 Nebraska Report

JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

Procedural Histo

The compensation court bifurcated the issues in the case. 

The compensation court conducted the first trial to determine 

whether the Co-op was liable for Jacobitz’ injury, but the 

issue of damages was reserved for a later time when Jacobitz 

reached maximum medical improvement. On January 28, 2013, 

the compensation court concluded that Jacobitz was injured in 

the scope and course of his employment.

In support of its ruling, the compensation court found that 

Jacobitz “believed he had to attend, or that it would at least 

be in his best interest to attend.” However, the court’s final 

holding that Jacobitz was injured in the course of employment was not grounded on a finding that Jacobitz was either 

expressly or impliedly required to attend the supper. Instead, 

the compensation court based its holding on the finding that 

the Co-op received a substantial benefit from Jacobitz’ attendance at the event. The compensation court stated: “The finding is that the [Co-op] received a substantial benefit when 

[Jacobitz] attended the appreciation night supper and visited 

with customers and was a fine representative of the [Co-op].” 

The compensation court also stated that the Co-op “received 

benefit because at the time [Jacobitz] was injured, he had just 

completed helping put away the smoker used to cook the meat 

at the Appreciation Night supper.”

The determination of monetary benefits was reserved for a 

further trial. The Co-op appealed the order on liability to this 

court.1 We found that because the compensation court’s order 

had resolved only the question of the employer’s liability and 

not the determination of benefits award, the order was not a 

final, appealable order.2 On remand, the compensation court 

determined the benefits due to Jacobitz as a result of his injuries. The Co-op again appeals the issue of liability.

1 Jacobitz v. Aurora Co-op, 287 Neb. 97, 841 N.W.2d 377 (2013).

2 Id.
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291 Nebraska Report

JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

STANDARD OF REVIEW

[1,2] An appellate court is obligated in workers’ compensation cases to make its own determinations as to questions of 

law.3 Upon appellate review, the findings of fact made by the 

trial judge of the compensation court have the effect of a jury 

verdict and will not be disturbed unless clearly wrong.4

[3] Pursuant to Neb. Rev. Stat. § 48-185 (Cum. Supp. 2014), 

an appellate court may modify, reverse, or set aside a Workers’ 

Compensation Court decision only when (1) the compensation court acted without or in excess of its powers; (2) the 

judgment, order, or award was procured by fraud; (3) there is 

no sufficient competent evidence in the record to warrant the 

making of the order, judgment, or award; or (4) the findings 

of fact by the compensation court do not support the order 

or award.5

ANALYSIS

The issue in this case is whether Jacobitz’ injuries arose 

out of and in the course of employment. The Co-op argues 

that it did not derive a substantial direct benefit from Jacobitz’ 

attendance at the supper. Particularly, the Co-op argues that the 

compensation court erred in finding that the injury arose out 

of and in the course of employment because the Co-op derived 

a “substantial benefit,” when the correct legal standard for a 

finding that the event arose in the course of employment is a 

“substantial direct benefit.”

[4,5] In a workers’ compensation case, the claimant must 

establish that the injury for which compensation is sought 

arose out of and in the course of employment.6 In the case of 

recreational or social activities incident to employment, we 

apply the following test to determine whether an injury arose 

out of and in the course of employment:

3 Miller v. Regional West Med. Ctr., 278 Neb. 676, 772 N.W.2d 872 (2009).

4 Torres v. Aulick Leasing, 261 Neb. 1016, 628 N.W.2d 212 (2001).

5 Davis v. Crete Carrier Corp., 274 Neb. 362, 740 N.W.2d 598 (2007).

6 Gray v. State, 205 Neb. 853, 290 N.W.2d 651 (1980).
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JACOBITZ v. AURORA CO-OP

Cite as 291 Neb. 349

“Recreational or social activities are within the course 

of employment when (1) They occur on the premises 

during a lunch or recreation period as a regular incident 

of the employment; or (2) The employer, by expressly 

or impliedly requiring participation, or by making the 

activity part of the services of an employee, brings 

the activity within the orbit of the employment; or (3) 

The employer derives substantial direct benefit from the 

activity beyond the intangible value of improvement in 

employee health and morale that is common to all kinds 

of recreation and social life.”7

Whether or not the activity falls within one of the enumerated categories is reviewed as a factual finding.8

 As we have 

stated, we “may reverse or modify the findings, order, award, 

or judgment of the original hearing only on the grounds that 

the judge was clearly wrong on the evidence or the decision 

was contrary to law.”9

The Co-op argues that the compensation court applied the 

wrong legal standard in its finding that the Co-op received a 

“substantial benefit” and awarding recovery, when the correct 

legal standard for the test is a “substantial direct benefit.”10

We agree.

In Gray v. State,

11 the employee’s injury was found to not 

be in the “course of employment.” In Gray, the injury was 

sustained in a car accident while the employee was on the way 

to a meeting of people within his career field. Though some 

of these meetings were required by the employee’s employment, this meeting was not expressly required, and it was 

7 Shade v. Ayars & Ayars, Inc., 247 Neb. 94, 97, 525 N.W.2d 32, 34 (1994), 

citing Gray v. State, supra note 6.

8 Shade v. Ayars & Ayars, Inc., supra note 7.

9 Id. at 99, 525 N.W.2d at 35. See, also, Gray v. State, supra note 6.

10 See Gray v. State, supra note 6.

11 Id.
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characterized by one of the planners as “primarily a social 

event.”12 We stated that without a requirement to be present at 

the meeting, the employer “did not benefit either directly or 

substantially from [the employee’s] participation therein.”13 We 

further stated that a benefit to the employer from social functions “was neither substantial nor direct,” because the benefit 

was “little, if any” to the employer.14

In Shade v. Ayars & Ayars, Inc.,

15 the employee was 

injured at a company picnic. There, the compensation court 

found, and we agreed, that the employee was not entitled to 

benefits, because he had failed to show that the company had 

received “‘any substantial direct benefit from the activity 

“picnic.”’”16

In our cases that have applied the “substantial direct benefit” 

test, we have made clear that the standard is a “substantial 

direct benefit” and not merely a “substantial benefit.” Though 

it is plain that the benefit must be both substantial and direct, 

we have not yet defined how “direct” fits into the analysis of 

a “substantial direct benefit.”17 Merriam-Webster’s dictionary 

defines “direct” as “stemming immediately from a source,” 

“natural, straightforward,” “marked by absence of an intervening agency, instrumentality, or influence,” and “characterized by close logical, causal, or consequential relationship.”18

Black’s Law Dictionary defines “direct” as “[f]ree from extraneous influence; immediate,” or “[t]o cause (something or 

someone) to move on a particular course.”19 Using “direct” 

as a part of the analysis has importance and must be applied 

12 Id. at 854, 290 N.W.2d at 652.

13 Id. at 858, 290 N.W.2d at 654.

14 Id. at 859, 290 N.W.2d at 654.

15 Shade v. Ayars & Ayars, Inc., supra note 7.

16 Id. at 96, 525 N.W.2d at 34.

17 See Gray v. State, supra note 6.

18 Merriam-Webster’s Collegiate Dictionary 327 (10th ed. 2001).

19 Black’s Law Dictionary 556 (10th ed. 2014).
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when determining whether or not an employee was injured in 

the course of employment. The court erred in failing to consider whether the benefit to the employer was both substantial 

and direct.

In this case, the compensation court found that the Co-op 

received a “substantial benefit” from Jacobitz’ participation in 

the supper. In support of that finding, the compensation court 

found that Jacobitz “visited with customers” at the supper. The 

compensation court did not consider whether that substantial 

benefit was direct, as required by our prior cases.20

CONCLUSION

Finding that the compensation court applied the wrong 

legal standard, we reverse the judgment and remand the cause 

for an application of the correct standard consistent with 

this opinion.

 Reversed and remand

further proceeding

20 See, Shade v. Ayars & Ayars, Inc., supra note 7; Gray v. State, supra

note 6.