Alchin and Repatriation Commission
[2005] AATA 287
•5 April 2005
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2005] AATA 287
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2004/470
VETERANS' APPEALS DIVISION )
Re ROBERT ALCHIN Applicant
And
REPATRIATION COMMISSION
Respondent
DECISION
Tribunal Mr R G Kenny, Member Date5 April 2005
PlaceBrisbane
Decision The Tribunal affirms the decision under review. ................[Sgd]....................
R G Kenny
Member
CATCHWORDS
VETERANS’ AFFAIRS – benefits and entitlements – special rate of pension – incapacity from war-caused conditions sufficient to prevent veteran from undertaking remunerative work for more than 8 hours per week - veteran not prevented by reason of incapacity from war-caused conditions, alone or substantially, from continuing to undertake remunerative work that he was undertaking – veteran not suffering a loss of salary or wages, or of earnings on his own account, that he would not be suffering if he were free of incapacity from war-caused conditions - pension payable at 100% of the general rate – decision affirmed
Veterans’ Entitlements Act 1986 ss 5Q, 15, 19, 22, 23, 24
Forbes v Repatriation Commission (2000) 101 FCR 50
Repatriation Commission v Hendy (2002) 76 ALD 47
Flentjar v Repatriation Commission (1997) 26 AAR 93Counsel v Repatriation Commission (2002) 72 ALD 74
Re Graham v Repatriation Commission (2004) 80 ALD 687
Re Bertram and Repatriation Commission (1986) AAT 2783; 29 July 1986Fox v Repatriation Commission (1997) 45 ALD 317
Leane v Repatriation Commission [2004] FCAFC 83REASONS FOR DECISION
5 April 2005 Mr R G Kenny, Member Background
1. In response to a claim for an increase in pension lodged on 27 July 2001 in accordance with section 15 of the Veterans’ Entitlements Act 1986 (the Act) by Robert Alchin (the applicant), a delegate of the Repatriation Commission (the respondent) determined, on 16 November 2001, that the degree of Mr Alchin’s incapacity from his war-caused conditions of chronic airflow limitation, generalised anxiety disorder and bilateral sensori-neural hearing loss was 100%. The respondent then determined that, in accordance with section 22 of the Act, pension was payable to him at 100% of the general rate.
2. On 4 May 2004, the decision of the respondent was affirmed by the Veterans’ Review Board and, on 25 June 2004, Mr Alchin sought review of that decision by the Administrative Appeals Tribunal (the Tribunal).
3. Mr Alchin attended the hearing and was represented by Mr J Selfridge of counsel. The respondent was represented by Mr J Kelly. The following material was taken into evidence:
exhibit 1:the “T” Documents (T1-T6) prepared in accordance with section 37 of the Administrative Appeals Tribunal Act 1975;
exhibit 2:a statement, undated but received by the Tribunal on 23 September 2004, by Jill Alchin, the applicant’s wife; and
exhibit 5: a financial statement, dated 26 July 2004, by Ward’s Tax Services.
Issues and Legislation
4. The standard of proof applicable in this matter is set out in subsection 120(4) of the Act. It requires that matters be determined to the decision maker’s reasonable satisfaction. The procedure to be followed is set out in section 19 of the Act. Paragraph 19(5C)(a) of the Act requires the rate of pension to be determined during the assessment period and that term is defined in subsection 19(9) of the Act as meaning the period starting on the application day and ending when the claim or application is determined. The application day in this case was 27 July 2001 and the assessment period runs from that day until the matter is determined by the Tribunal. Mr Alchin was born on 9 February 1945 and, on the application day, he was 56 years of age.
5. It is not disputed that the pension payable to Mr Alchin was correctly assessed by the respondent at 100% of the general rate. The issue raised by Mr Alchin is whether he meets the criteria for payment of an earnings-related rate of pension under section 23 or section 24 of the Act. These relate, respectively, to the intermediate rate and special rate of pension. Mr Selfridge submitted that the special rate of pension was payable in this case.
6. The matters that need to be determined in relation to the special rate of pension are whether or not Mr Alchin meets the requirements of paragraphs 24(1)(a), (b) and (c) of the Act. These read:
“24(1) This section applies to a veteran if:
(a) …..
(i) the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be at least 70% or has been so determined by a determination that is in force;
……..
(b) the veteran is totally and permanently incapacitated, that is to say, the veteran’s incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and
(c) the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity; ..”
Applicant’s Evidence
7. From October 1972 until November 1999, Mr Alchin was employed by BHP Steel (AIS) Pty Ltd Appin Colliery in New South Wales. He had a variety of jobs in the colliery but, for the last four years, he was employed as the train driver and was responsible for moving men and equipment in and out of the colliery. He described this as the best job on the colliery site because he was able to work without supervision. He enjoyed the work but began to experience dizzy spells and breathing problems and he was finding it hard to cope with the work. He did not discuss these problems with anyone except his wife and was not receiving any medical treatment for them at the time.
8. Mr Alchin decided to stop working in the colliery and he and his wife began considering alternative means of employment. They had an interest in dog breeding and had previously been involved in the racing of greyhound dogs. They became aware of a suitable property for sale at Ebenezer which is near Rosewood, west of Brisbane. They agreed to purchase the property and, at that time, Mr Alchin had not given notice of his intention to leave the colliery. About a month before he finished there, BHP offered voluntary redundancy packages to its workers. Mr Alchin accepted one of these, leaving with a payment in the order of $55,000. He described this as being fortuitous because he had already made up his mind to leave.
9. Mr Alchin and his wife paid $290,000 for the property at Ebenezer. It comprised 60 acres and included a house, boarding kennels and training facilities for dogs. They had estimated that they would be able to accommodate approximately 100 dogs including whelping bitches, racing dogs which were spelling and also dogs which they would breed themselves. There were no accounting or business records provided to them but they estimated that they would be able to earn a level of income similar to the $70,000 per year which Mr Alchin had earned in the colliery. They moved to the property and commenced running the business, Bushhaven Kennels, on 1 January 2000.
10. For the first 6 months, Mr Alchin was fully engaged in the kennel business and worked for 12 hours each day looking after the dogs. He said that they started off with 60 dogs and he described the work as not very physical in nature although it included a lot of walking with the dogs. Mr Alchin said he had played no part in the financial affairs of the kennel business and was not aware of whether or not it made a profit. However, he said that he was not paid any wages and that he and his wife have been living on the separation and superannuation payments that he received when he left the colliery. After the first 6 months, Mr Alchin decided that he was unable to continue and, thereafter, did nothing in relation to the business except, as he said, “to pat the dogs from time to time”. From then on, he said, he spent most of his day watching television and has not attempted to obtain any employment since mid-2000. He was granted the service pension in January 2002.
11. Mr Alchin was diagnosed with hypertension before he moved to Queensland and his evidence was that continuing adjustments are made to his medication because the condition is unstable. Cardiomyopathy was diagnosed in 1998 after his treating doctor in New South Wales, Dr Rankin, referred him to a specialist, Dr William Quinn, to have stress tests done. He also suffers from knee problems. Since coming to Queensland, Mr Alchin has been treated by Dr C Stevenson at Rosewood. Dr Stevenson completed reports which referred to the severity of his cardiomyopathy and his knee conditions and Mr Alchin agreed that he had told Dr Stevenson that he was having problems with his knees and that he had seen orthopaedic specialists who had recommended that he have knee replacement surgery. Mr Alchin agreed that he had trouble after walking about 80 metres, but attributed this to shortness of breath and not his knee problems. He said that his ability to work was not affected by the heart or knee conditions.
12. Mr Alchin’s generalised anxiety disorder was diagnosed in 1994 and, shortly after that, the respondent accepted the condition as being related to his army service. He saw a psychiatrist at that time but did not have a continuing association with him. After lodging his claim for an increase in pension in July 2001, Mr Alchin also claimed post traumatic stress disorder as being related to his service. This was eventually rejected by the respondent but, in processing that claim, Mr Alchin saw psychiatrist, Dr Jonathan Hargreaves. He said that he told Dr Hargreaves the reasons for his leaving the colliery and ceasing work in the boarding kennels and also that he suffered from cardiomyopathy and osteoarthrosis of the knees.
13. Mr Alchin said that, when he was working in the colliery, he was often unable to attend work because of his health problems. He said that he did not use sick leave but, instead, deducted days from his holidays. He agreed that, when he finished at the colliery, he was paid out sums equivalent to 44 days of annual leave, 23 days of long service leave and 38 days of sick leave. Mr Alchin said that, in the final periods at the colliery, he was having pains in his chest and felt he could not cope any longer. That was also the case with the work at the kennels. He took no medical advice as to whether or not he should stop working at the colliery or in the kennel business. He said he only left these jobs because of his anxiety state, dizziness and chest pains. He said that he would have been able to continue working if it were not for his accepted disabilities and that he had always intended to work until the retirement age of 60 years.
Evidence of Mrs Alchin
14. Mrs Alchin said that Mr Alchin was in a senior position at the colliery and had a job that he enjoyed but he felt that he was not able to do it properly. She said that he would often come home from work feeling anxious and sometimes he would not go to work at all. She said he was not coping and that he had taken a lot of sick leave. She said that they had made a decision to move into Bushhaven Kennels in Queensland before the redundancy offer was made and described that offer as being a stroke of good fortune on their part. Mrs Alchin said she was aware that her husband had not been receiving medical treatment in the final period of time when he was working at the colliery. She said that they both thought that moving to a completely different form of work in looking after the dogs would enable him to cope because it was more in the order of recreational work or a working holiday. She had believed that it was an established business which was financially viable although she agreed that she had not seen any business records from the previous owners.
15. Mrs Alchin said that the dog kennel business had been a joint enterprise initially and that she and Mr Alchin had both worked for some 12 to 14 hours each day at the start. She described the work as being physically demanding and referred to the need to handle dogs weighing up to 35 to 40 kilograms 100 times each day and having to clean out the kennels on a daily basis. She said Mr Alchin began to have difficulties coping with the work and, in particular, had problems with his concentration and was unable to continue after the first 6 months. She said that she sacked him from working with the dogs because of his lack of concentration in July 2000 and that he had not been involved in the business since. However, she said that he did carry out routine maintenance work from time to time such as fixing locks and repairing fences. She said that she was aware that he had a heart condition and problems with his knees but said that these did not interfere with his capacity to work.
16. In about mid-2001, Mrs Alchin became the sole proprietor of Bushhaven Kennels. She said that she had managed all of the finances in respect of the business although she and Mr Alchin shared the domestic financial arrangements on an equal basis. She said that they had over 100 dogs from the beginning and, yet, the business had always run at a loss and she confirmed as correct the figures provided by the accountant (exhibit 3). She said neither she nor her husband had taken any wage from the business which had gradually run down to the point where she closed it down completely in 2004 although she retained the relevant kennel and environmental licenses. She said that she could not recall how many dogs were in the kennels when she closed the business. She said that, in the absence of an income from the business, they had managed to cope by running down Mr Alchin’s superannuation and redundancy payments although she said that they were each in receipt of a service pension and that Mr Alchin also had his disability pension from the respondent.
Submissions
17. Mr Selfridge submitted that all of the requirements of section 24 of the Act were met. He referred to the medical evidence of Dr Hargreaves and Dr Stevenson as demonstrating that Mr Alchin’s accepted disabilities were at such a level that they prevented him from working for more than 8 hours per week. He also submitted that it was accepted disabilities, in particular the anxiety disorder, alone, which prevented Mr Alchin from continuing in remunerative work both at the colliery and in the kennels and thereafter. He submitted that the chest pains which afflicted Mr Alchin were not related to his heart condition but, rather, to his anxiety attacks. He submitted that the voluntary redundancy payment had not impacted at all on Mr Alchin’s decision to leave the colliery and that he would still be working there if it were not for his incapacities.
18. In relation to work at Bushhaven Kennels, Mr Selfridge submitted that, when Mr Alchin became too ill to continue, there was a downward spiralling in the business as a whole because it was not viable without his extra assistance. He said that this meant that there had been a loss of income because of Mr Alchin’s accepted disabilities. He submitted that the mere fact that the business had run at a loss did not deprive it of the character of remunerative work and did not mean that he did not suffer a loss of income.
19. In the alternative, Mr Selfridge submitted that the ameliorating terms of paragraph 24(2)(b) of the Act were applicable because Mr Alchin was under 65 years of age. He was receiving the service pension and, therefore, did not need to look for work and, in any event, both Dr Hargreaves and Dr Stevenson had told him that he could not work. In that situation, even if it were not his accepted disabilities alone which prevented him from continuing in remunerative work, they were the substantial cause of that outcome.
20. For the respondent, Mr Kelly conceded that Mr Alchin’s accepted disabilities were at such a level that they would prevent him from working for 8 hours a week. However, he submitted that the special rate was not payable because the terms of paragraph 24(1)(c) of the Act were not met. He submitted that the reason for Mr Alchin leaving his job at the colliery was related to a mix of factors including chest pains which were associated with his non-accepted disability of cardiomyopathy. He also noted that Mr Alchin had given up that job without taking any medical advice and that the residual payout for holidays, sick leave and long service leave meant that he had not been absent from the workplace for reasons of health as often as Mr Alchin stated in his evidence. Mr Kelly said it was surprising that Mr Alchin had not sought any medical treatment in respect of his anxiety because it had been accepted by the respondent as service-related since 1995. He submitted that this would have been known by his treating doctor and, yet, no treatment had been sought.
21. In relation to the work in the kennels, Mr Kelly submitted that the cessation of his involvement after 6 months of working 12 hours a day had made no difference to his financial position in respect of income from the enterprise because at no stage had he ever been paid a wage and, at all times, the business lost money. He referred to the statement by the accountant (exhibit 3) and noted that the greatest losses were in the period when Mr Alchin had been involved with the kennels. Again, he submitted that this meant that he had not satisfied the terms of paragraph 24(1)(c) of the Act.
22. Mr Kelly also submitted that paragraph 24(2)(b) of the Act was not satisfied because there had been no genuine attempt by Mr Alchin to obtain employment. He noted that he had been in receipt of a service pension since 18 January 2002.
Consideration
23. It is not in dispute and I am satisfied that the requirements of paragraph 24(1)(a) of the Act are met. Mr Alchin is in receipt of pension at more than 70% of the general rate.
24. Paragraph 24(1)(b) of the Act requires that the incapacity from Mr Alchin’s war-caused diseases be such that it, in itself alone, renders him incapable of undertaking remunerative work for periods of more than 8 hours per week. Dr Stevenson supplied reports dated 25 August 2001, 15 September 2001 and 3 October 2001. In those reports, Dr Stevenson does not specifically indicate the extent to which Mr Alchin’s accepted disabilities incapacitate him for the purposes of paragraph 24(1)(b) of the Act.
25. Also in evidence were reports from Dr Hargreaves. These were dated 3 August 2001, 31 August 2001 and 22 October 2001. In the August reports, Dr Hargreaves diagnosed generalised anxiety disorder and, in the more detailed subsequent report, he referred to Mr Alchin’s ability to work in the following terms:
“He last worked in November 1999 as a train driver in a coal mine. This was a job he enjoyed but he left it owing to dyspnoea and nervousness. He was complaining of panic attacks and had been taking off a large number of days sick/year some 15-20 days mainly for stress reasons. He continues to experience anxiety symptoms, which would render him unable to return to that kind of work. He stated that he could not handle working in a job involving the general public and that he requires isolation from other people. He has no active leisure life, suggesting a fairly low level of motivation and energy. His failure to contribute to the running of their greyhound stud because of poor motivation and concentration, and anxiety, also suggests that he is unfit to work in any kind of capacity. As I can’t conceive of job that would involve a very light workload, in which no contact with the general public is required and which doesn’t require any physical exertion, I would consider him effectively totally and permanently incapacitated.
Other conditions affecting ability to work: Aside from the psychiatric condition, it is likely that a combination of cardiomyopathy and some form of lung disease (both of which I am unable to substantiate) are conditions which are impacting on his ability to work.”
26. Dr Hargreaves described anxiety symptoms which would render Mr Alchin unable to return to the kind of work he did in the colliery and at the kennels. On the basis of that reference and of the concession by Mr Kelly, I accept that there is evidence to satisfy paragraph 24(1)(b) of the Act.
27. The application of paragraph 24(1)(c) involves a consideration of what Mr Alchin would probably have done in the assessment period, which commenced in July 2001, in the absence of his accepted disabilities: see Repatriation Commission v Hendy (2002) 76 ALD 47 at 54. The matter will be resolved against Mr Alchin if there are factors other than his accepted disabilities which also would have prevented him from continuing to undertake remunerative work.
28. The Federal Court in Flentjar v Repatriation Commission (1997) 26 AAR 93 said that a proper consideration of paragraph 24(1)(c) of the Act requires responses to the following questions:
“1. What was the relevant ‘remunerative work that the veteran was undertaking’ within the meaning of s 24(1)(c) of the Act?
2. Is the veteran, by reason of war-caused injury or war-caused disease, or both, prevented from continuing to undertake that work?
3. If the answer to question 2 is yes, is the war-caused injury or war-caused disease, or both, the only factor or factors preventing the veteran from continuing to undertake that work?
4. If the answers to questions 2 and 3 are, in each case, yes, is the veteran, by reason of being prevented from continuing to undertake that work, suffering a loss of salary, wages or earnings on his own account that he would not be suffering if he were free of that incapacity?”
29. In addition, consideration must be given to paragraph 24(2)(a) of the Act which operates in conjunction with the fourth of those questions and paragraph 24(2)(b) of the Act which operates, in the case of a veteran under 65 years of age, in conjunction with the third of those questions.
30. The term remunerative work is broadly defined in sub-section 5Q(1) of the Act as including any remunerative activity. In evidence was an employment separation certificate completed by Mr P Ostwald on 10 December 1999. He was the site services officer at the Appin Colliery and he wrote that Mr Alchin was employed there from 16 October 1972 until 26 November 1999 and took a voluntary redundancy which was the reason for termination. He recorded that the total payment received by Mr Alchin amounted to $55,429 and that it included:
type number of working days amount $ (gross) annual leave 44 8,596 long service leave 23 4,467 sick leave 38 4,994
31. Also in evidence were taxation notices of assessment and these showed that Mr Alchin had a taxable income of $63,980 in the financial year ending 30 June 1996; $62,186 in the financial year ending 30 June 1997; $65,188 in the financial year ending 30 June 1998; and $42,387 in the financial year ending 30 June 2000. I am reasonably satisfied that the type of work Mr Alchin undertook at the colliery constituted remunerative work for the purposes of paragraph 24(1)(c) of the Act.
32. The position is not so clear with Mr Alchin’s involvement with Bushhaven Kennels. In many respects, the evidence of this was unsatisfactory. Mr Alchin was vague and at times evasive in his responses concerning his previous experience with greyhound dogs, with the role he played in the business and with the financial aspects of the business. There were also inconsistencies between his evidence and that of Mrs Alchin. The nature of the day-to-day work at the kennels was described by Mr Alchin as not being very physical although it included a lot of walking. Mrs Alchin described it as being physically demanding and referred to the need to handle heavy dogs and to clean kennels on a daily basis. Mrs Alchin said that, when they began, there were more than 100 dogs in the kennels and Mr Alchin said there were 60. Mr Alchin said that, after July 2000, he did no work at all on the property but Mrs Alchin said that he carried out routine maintenance work such as fixing locks and repairing fences. Mrs Alchin said that the business was structured so that she assumed financial responsibility for it and I accept her evidence in that regard. But, she also said that she shared that responsibility with Mr Alchin in relation to their domestic finances. In that sense, Mr Alchin had some capacity to comprehend financial matters and I do not accept his evidence that he had no idea that the business was running at a loss rather than yielding anything like the $70,000 per year which they had expected to earn.
33. Mr Alchin said that he had nothing to do with the dogs, apart from patting them from time to time, at Bushhaven after June 2000. In his detailed report, dated 22 October 2001, Dr Hargreaves commented upon the leisure activities of Mr Alchin in the following terms:
“Very few, if any, interests, except keeping greyhounds (ten) which he spends two hours a day on. (Wife races them. He doesn’t go). He can’t handle crowds, people, pressures. He avoids all social activities. Has poor concentration & memory.”
34. When this was put to him in evidence, Mr Alchin said that Dr Hargreaves must have misunderstood him because he was not doing anything with the dogs at that time. On two other occasions in his evidence, he said that he could not recall telling Dr Hargreaves about the dogs. This is yet another inconsistency in Mr Alchin’s evidence which, along with those noted above in paragraph 32, makes him an unreliable witness. The reference by Dr Hargreaves is specific in detail which could only have been provided by Mr Alchin who, in his evidence, said that he was always honest when providing information to doctors.
35. The evidence of Mr Alchin was that he did not receive any payment from the business. That was confirmed by Mrs Alchin. Profit and loss statements for Bushhaven Kennels were in evidence and revealed, for the year ending 30 June 2000, kennel fees in the amount of $26,067 and expenses for the running of the business at $34,710 resulting in a loss of $8,643. This was related to the first six months of the business which began operating in January 2000. For the year ending 30 June 2001, the kennel fees are stated to be $32,123 and the total expenses $45,313 with a loss of $13,190. Those figures were confirmed in the accountant’s statement (exhibit 3) where it was also noted that the financial years 2001/2002 and 2002/2003 yielded net losses of $8,399 and $4,454, respectively. Nevertheless, it was the intention of Mr and Mrs Alchin when they purchased the kennels to conduct it as a business and to make a profit. Clearly, they were unsuccessful. That does not preclude the activity undertaken by Mr Alchin from being described as remunerative work. The matter arose in Counsel v Repatriation Commission (2002) 72 ALD 204 where the Full Federal Court construed the meaning of the phrase “earnings on his or her own account” in paragraph 24(2A)(e) of the Act. There, the applicant and his wife carried on a farming business in partnership for seven years. In all but one year, it made a loss. Goldberg J said (at 219):
“The fact that at the end of the relevant accounting period the partnership might be showing a loss should not obscure the fact that during that year the appellant had access to the cashflow or earnings of the partnership which had been derived from his personal exertion. When the appellant was ultimately prevented by incapacity from continuing to undertake the work which he carried out in the course of the partnership, he thereby suffered a loss of earnings on his own account in the sense that he was no longer able to have access to, or take advantage of, the cashflow or earnings of the partnership business. It is not to the point that at the end of a relevant accounting period the partnership was shown in its accounts to have carried on business at a loss."
36. Gray J agreed with that approach and said (at 210):
“There may be various reasons why accounts compiled after the end of a financial period may show that a partnership business that was receiving income during that period made a loss in that period. This does not detract from the fact that, during the period, each of the partners as a member of the partnership was entitled to income according to the terms of the partnership agreement. In the case of a partner, such as the appellant, whose physical and mental labour produced or contributed to the generation of that income, it is appropriate to regard that income as ‘earnings on his or her own account’ within the meaning of s 24(2A)(e).”
37. That case was concerned with the application of subsection 24(2A) of the Act which relates to veterans aged over 65 years. Mr Alchin is not in that category. However, the interpretation of remunerative work adopted by the Full Court has been adopted by the Tribunal for paragraph 24(1)(c) as it applies to him: see Re Graham v Repatriation Commission (2004) 80 ALD 687 at 700 and see also Re Bertram and Repatriation Commission (1986) AAT decision 2783; 29 July 1986. On that basis, I am satisfied that the types of duties undertaken by Mr Alchin at Bushhaven Kennels in the first 6 months of 2000 constituted remunerative work for the purposes of paragraph 24(1)(c) of the Act.
38. I accept as correct the submission by Mr Selfridge, on the second of the Flentjar questions, that Mr Alchin’s anxiety disorder and chronic airflow limitation would prevent him from undertaking each of the forms of remunerative work identified above. However, for the third Flentjar question, which raises the first part of paragraph 24(1)(c) of the Act, it must also be the case that there is no other factor, apart from his accepted disabilities, which would impact upon Mr Alchin’s capacity to undertake such remunerative work at the start of or during the assessment period. Such a factor may be a medical condition in Mr Alchin which has not been accepted by the respondent as being service-related and which, by itself or in combination with his accepted disabilities, would prevent him from continuing to undertake the types of remunerative work referred to above: see Forbes v Repatriation Commission (2000) 101 FCR 50 at 57.
39. Cardiomyopathy was diagnosed by consultant physician and cardiologist, Dr William Quinn, in his report of 30 November 1998, which was in evidence. Dr Stevenson, in his report of 25 August 2001, wrote that Mr Alchin could not cope with work because of “giddy attacks and dyspnoea” as well as panic attacks. He described symptoms involving “shortness of breath, pain in the chest mainly during exertion always”. He wrote that these symptoms were not due solely to chronic airflow limitation as there was contribution from cardiomyopathy and he noted that Mr Alchin had great concern regarding his cardiologist’s report.
40. In his report of 15 September 2001, Dr Stevenson provided an assessment for Mr Alchin’s cardiomyopathy. He described symptoms as “chest pains quite often but bearable” and said that he was not able to undertake employment because of his “mental capacity/state i.e. depression, panic attacks, unable to concentrate, chest pains and shortness of breath”. Dr Stevenson also referred to hypertension as a reason for his ceasing work in 1999. Dr Stevenson provided a rating for the various conditions Mr Alchin had using the following Functional Rating Scale:
Rating Description 0 no functional effect 1 minor effect on certain functions only 2 moderate effect on certain functions only 3 severe effect on certain functions only 4 severe or disabling effect on many functions 5 overwhelming effect on all relevant system functions
41. Dr Stevenson described cardiomyopathy as having a rating of 3 which equated with it having a severe effect on certain functions. He allocated a rating of 4 to chronic airflow limitation and expressed concern about attempting to differentiate the proportionality of chest symptoms from Mr Alchin’s heart and lung conditions. He said that it was not possible to distinguish between cardiomyopathy, musculoskeletal pain, stress and respiratory problems in assessing his difficulties. As I read his report, he clearly implicated the heart condition as having a role to play in Mr Alchin’s incapacity. Dr Doug Brodie, compensation medical advisor with the respondent, completed a report, dated 13 November 2001, in which he also implicated the heart condition as making a contribution to Mr Alchin’s lung functioning.
42. In addition to cardiomyopathy, Mr Alchin also has significant orthopaedic difficulties. Dr Stevenson, in his report of 3 October 2001, recorded a loss of about 25% of range of movement in the lower back. He described Mr Alchin’s left knee as being “unstable due to gross osteoarthritis” and his right knee as being “fairly unstable”. In describing the symptoms reported by Mr Alchin, he wrote “Chronic pain – absolute agony – exacerbation of pain with activity”. He continued by noting “Constant soreness especially when in bed” and “Needs both hands to push himself up” and “Walks with a limp and stiffness” with a need to rest after “about 80 metres” because of “pain and stiffness”. In his evidence, Mr Alchin agreed that he so advised Dr Stevenson and he also agreed that, in his evidence to the Veterans’ Review Board, he said that his knees were “worn out”. Dr Stevenson wrote further:
“He really needs joint replacement. He had a consultation with an orthopaedic surgeon 18 months ago and was told he was too young for a replacement. He recently saw another orthopod who advocated replacement surgery.”
43. In his report of 15 September 2001, Dr Stevenson allocated a rating of 3 to the knee conditions.
44. Dr Stevenson, in his report of 15 September 2001, also attributed Mr Alchin’s incapacity for employment to hypertension and Mr Alchin described this as having been unstable in recent times.
45. On the application day in July 2001, and in the assessment period, I am reasonably satisfied that Mr Alchin would not be continuing to undertake the types of remunerative work that he was undertaking at the colliery or in the kennel business for reasons associated not only with his war-caused disabilities but also because of incapacity associated with disabilities that have not been found to be war-caused ie osteoarthritis of the knees and cardiomyopathy and, to some extent, hypertension. As I am satisfied that the incapacity associated with his war-caused disabilities was not the only factor which would have prevented him from continuing to undertake remunerative work of the kind that he undertook in the colliery or in the kennels, this means that the third question in Flentjar’s case is answered in the negative. However, as noted above, consideration must be given to paragraph 24(2)(b) of the Act which operates, in the case of a veteran under 65 years of age, in conjunction with that question. It reads:
“(2) For the purpose of paragraph (1)(c):
(a) ……….
(b) where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking.”
46. As Mr Alchin is under the age of 65 years, it will be sufficient, to satisfy the third Flentjar question, if his war-caused disabilities are the substantial cause of his inability to obtain remunerative work. In Fox v RepatriationCommission, (1997) 45 ALD 317, this was referred to as being met if the war-caused conditions would constitute the operative cause for that inability (at 319).
47. A pre-condition to the application of paragraph 24(2)(b) of the Act is that Mr Alchin must have been genuinely seeking to engage in remunerative work. In Leane v Repatriation Commission [2004] FCAFC 83, the Full Federal Court referred to this requirement in the following way:
“28. The primary judge interpreted the word ‘seeking’ to mean ‘attempting to’ or ‘trying to’. This may be accepted. Such a meaning involves something more than a mere wish or hope. It requires that a claimant ‘do’ something. On the other hand the word ‘genuinely’ is used in the sense of ‘sincerely’ or ‘honestly’. It involves an assessment of the subjective intention or purpose of a claimant. What is required is that the claimant honestly be trying to engage in remunerative work.”
48. After leaving the colliery, Mr Alchin worked at the boarding kennels. Since mid-2000 when he last worked there until January 2002 when he began to receive the service pension, Mr Alchin did not attempt to obtain any further employment. He has not done so since then. For that reason, subsection 24(2)(b) of the Act is not met. In any event, even if he had attempted to find employment, I am not satisfied that his accepted disabilities would have been the substantial cause for failing to do so if that had been the outcome. They would have had a role to play but Dr Stevenson was unable to give quantification to the extent that his problems were associated with accepted and non-accepted disabilities, in particular, his knee and heart conditions. I note that Dr Hargreaves purported to quantify the proportional input from psychiatric (80%) and non-psychiatric (20%) causes. Mr Alchin said that he told Dr Hargreaves about his knees. However, even though Dr Hargreaves included a “past medical history” in his report of October 2001, he made no reference to Mr Alchin’s knee conditions. Dr Hargreaves’ report was prepared in the same month in which Mr Alchin described, to Dr Stevenson, his knees as giving him “absolute agony” and after he had been advised by two orthopaedic specialists that he needed knee replacement surgery. In that situation, I am satisfied that Dr Hargreaves’ report was based on an incomplete medical picture of Mr Alchin.
49. Given the presence of his cardiomyopathy and his knee conditions, I am reasonably satisfied that Mr Alchin’s war-caused conditions would not be the substantial cause of his inability to obtain remunerative work in which to engage in the assessment period. Accordingly, I am reasonably satisfied that the third of the Flentjar questions is answered in the negative.
50. The fourth question postulated in Flentjar’s case raises the second part of paragraph 24(1)(c) of the Act. This is whether Mr Alchin is, by reason of incapacity from his war-caused conditions, suffering a loss of salary or wages, or of earnings on his own account, that he would not be suffering if he were free of that incapacity. This provision must be read in conjunction with paragraph 24(2)(a) of the Act which reads:
“(2) For the purpose of paragraph (1)(c):
(a) a veteran who is incapacitated from war-caused injury or war-caused disease, or both, shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, by reason of that incapacity if:
(i)the veteran has ceased to engage in remunerative work for reasons other than his or her incapacity from that war-caused injury or war-caused disease, or both; or
(ii)the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason;”
51. I am reasonably satisfied that Mr Alchin’s non-accepted conditions of cardiomyopathy and osteoarthrosis of the knee joints were of such a degree of severity that they would have played a part in the termination of his employment at both the colliery and the boarding kennels and that they would have continued to have that effect thereafter. The first of the orthopaedic surgeon consultations referred to by Dr Stevenson, being 18 months before his October 2001 report, would have been in about April 2000. This was in the period that Mr Alchin was working in the kennels. In his evidence, he said he was limited to walking 80 metres because of his breathlessness. That is not consistent with the specific comments made by Dr Stevenson who attributed that distance limitation solely to osteoarthrosis of his knees. Given the description of the symptoms referred to by Dr Stevenson and the opinion that surgical intervention was required at that time, I do not accept Mr Alchin’s evidence that his knee condition was not playing a part in his inability to carry out remunerative work of the kind that he had been undertaking or that it would not continue to do so into the assessment period.
52. I have already noted that the details of the running of the kennel business were far from clear. However, it clearly made no profit and the period of least productivity was that when Mr Alchin was working there. In the first six months of operation, it lost $8,643. The business continued to lose money thereafter but at a lower rate than in the first six months of operation. I am reasonably satisfied that the fourth question in Flentjaris answered in the negative.
53. I am satisfied that Mr Alchin does not meet the requirements for the payment of the special rate of pension because, specifically, he fails to satisfy the terms of paragraph 24(1)(c) of the Act. Though the intermediate rate of pension, for which provision is made in section 23 of the Act, was not raised on his behalf in this case, I am also satisfied that the requirements for payment of pension at that rate are not met because of paragraph 23(1)(c) of the Act which operates in the same manner as paragraph 24(1)(c) thereof.
Decision
54. The Tribunal affirms the decision under review.
I certify that the 54 preceding paragraphs are a true copy of the reasons for the decision herein of Mr R G Kenny, Member
Signed: ..Camille Banks
Associate
Dates of Hearing 17 February 2005
Date of Decision 5 April 2005
Counsel for the Applicant Mr J Selfridge
Solicitor for the Applicant Sciacca’s Lawyers
For the Respondent Mr J Kelly, Departmental Advocate
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