PROCEDURE - MISCELLANEOUS PROCEDURAL MATTERS - VEXATIOUS LITIGANTS AND PROCEEDINGS
ESTOPPEL - ESTOPPEL BY JUDGMENT - RES JUDICATA OR CAUSE OF ACTION ESTOPPEL
ESTOPPEL - ESTOPPEL BY JUDGMENT - ANSHUN ESTOPPEL
SUPERANNUATION - BENEFITS - MATTERS AFFECTING ENTITLEMENT TO AND PAYMENT OF
Application under section 39 of Supreme Court Act 1935 for permission to institute action in District Court against superannuation trustees.
Mr Kowalski was employed by Mitsubishi Motors and a member of its Staff Superannuation Fund. In August 1991, he was certified unfit to work by his psychiatrist. He remained disabled from returning to work until March 1994 when Mitsubishi Motors wrote to him saying his inability to return to work had frustrated his contract of employment.
In February 1992, Mr Kowalski lodged with the trustee a total disablement claim which the trustee treated as a claim for monthly income benefit and for TPD benefit. Reports were provided to the trustee by Mr Kowalski’s psychiatrist in June 1992 and March 1993 confirming that he was unable to work but saying that to that point his condition could only be regarded as total and temporary disablement.
In March 1994, Mitsubishi wrote to Mr Kowalski saying his employment had been frustrated due to his inability to work. In August 1994, the trustee paid to Mr Kowalski an ordinary early retirement benefit. The trustee did not consider Mr Kowalski’s eligibility for sickness retirement benefit or TPD benefit.
In September 1997 and October 1998 Mr Kowalski claimed that he was entitled to a sickness retirement benefit and TPD benefit respectively.
On 27 October 1998, Mr Kowalski and Mitsubishi Motors entered into a Heads of Agreement under which Mitsubishi Motors paid to Mr Kowalski $200,000 and Mr Kowalski agreed, amongst other things, not to sue for any entitlements he may have to superannuation. The Heads of Agreement provided that approximately $65,000 of the total settlement sum was to be paid from the Fund by way of a sickness retirement benefit. The trustee was not a party to the Heads of Agreement. In November 1998, the Trustee paid to Mr Kowalski a sickness retirement benefit of approximately $65,000.
In June 1999, Mr Kowalski made a claim for a TPD benefit and the trustee responded saying that any additional medical conditions that had arisen since August 1992 were not relevant and the trustee was unable to pay a TPD benefit unless its insurer formed an opinion that he met the definition.
In July 1999, Mr Kowalski made a further claim for a TPD benefit. In August 2001, the trustee wrote to Mr Kowalski saying that insurance cover had ceased in August 1991 when Mr Kowalski ceased to be in gainful employment, Mr Kowalski was not permanently disabled at that time and he was not entitled to any further benefit.
Mr Kowalski made further applications for TPD benefit in November 2005, March 2010 and May 2014.
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Attorney-General v Kowalski [2015] SASC 123
Case
[2015] SASC 123
Decision Date
CaseChat Overview and Summary
In the case of Attorney-General v Kowalski, the respondents sought to prevent the applicant, Mr Kowalski, from initiating legal proceedings against them. The central dispute was whether Mr Kowalski had a tenable claim for superannuation benefits, specifically a Total Permanent Disability (TPD) Benefit, against the respondents, Mitsubishi Superannuation and AMP Superannuation. The matter was heard in the Supreme Court of South Australia.
The legal issues before the court included whether the respondents' defences based on res judicata, issue estoppel, and Anshun estoppel, arising from previous Federal Court actions, precluded Mr Kowalski's proposed action. Additionally, the court had to determine if the proposed action constituted an abuse of process, and whether a Heads of Agreement between Mr Kowalski and Mitsubishi Motors Limited, coupled with issue estoppel from a prior summary judgment, barred Mr Kowalski's claims.
The court found that Mr Kowalski had a tenable claim against the respondents and granted permission for the proposed action in the District Court. The court reasoned that while the appropriate remedy for one of the causes of action would be for the Trustee to consider eligibility for a TPD benefit according to law, the material before the court did not warrant the court exercising its discretion to determine eligibility itself. The court also noted that a medical opinion on the relevant question had not been obtained. The draft statement of claim was to be amended to seek a declaration of breach of fiduciary duty by the Trustee, direction for the Trustee to consider the eligibility for a TPD benefit, and costs as remedies.
The court directed Mr Kowalski to bring forward a draft statement of claim reflecting these reasons. The complex relationship between Mitsubishi Superannuation and AMP Superannuation, governed by the June 2006 Transfer Deed, was to be addressed in the District Court action.
Orders
Orders of the court
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Background
Background to the litigation
The respondents contend that the causes of action sought to be advanced in the proposed action are not tenable:1.because they have a defence to which Mr Kowalski has no tenable answer that some causes of action are precluded by res judicata or alternatively issue estoppel as a result of summary judgment granted in the Federal Court by Finn J in Kowalski v MMAL Staff Superannuation Fund Pty Ltd and AMP Superannuation Ltd SAD11 of 2007 (the first Federal Court action) or by Mansfield J in Kowalski v AMP Superannuation Ltd SAD27 of 2010 (the second Federal Court action);2.because they have a defence to which Mr Kowalski has no tenable answer that the other causes of action are precluded by “Anshun estoppel” by reason of the pursuit by Mr Kowalski of the two Federal Court actions without including them;3.because they have a defence to which Mr Kowalski has no tenable answer that all causes of action are precluded by a Heads of Agreement between Mr Kowalski and Mitsubishi Motors Limited which preclusion Mr Kowalski is prevented from challenging by issue estoppel arising from the summary judgment in the first Federal Court action;4because they are an abuse of process as an impermissible attempt to relitigate claims the subject of the first and second Federal Court actions; or5.for the reasons given by Finn J and Mansfield J in the first and second Federal Court actions.Background The documents exhibited to the affidavits establish on a prima facie basis the following matters.The Superannuation Fund On 1 November 1967, the Mitsubishi Motors Australia Staff Superannuation Fund (the Fund) was established. The Fund is governed by a Trust Deed and Rules dated 30 November 1967, substituted on 16 December 1986 and amended thereafter (collectively the Trust Deed). The Rules contained in and forming part of the Trust Deed (the Rules) apply to and bind all members of the Fund.[1][1] Clauses A.1, A.2. Up to 30 June 1994, six individuals were the trustees (the Trustee) of the Fund. On 1 July 1994, Mitsubishi Superannuation became trustee in their place and the Trust Deed was amended to provide that the directors of Mitsubishi Superannuation were to consist of persons selected from amongst the members of the Fund under procedures determined by the Trustee and an equal number of persons selected by Mitsubishi Motors.[2][2] Clause 2A. The Trust Deed provides for full-time employees of Mitsubishi Motors Australia Ltd to be members (members) and for superannuation contributions to be paid into the Fund by members or on their behalf into the Fund.[3] [3] Clauses A.1, A.2, A.5, A.6, B.1, B.2, B.4, C.1 and C.2. Section C of the Rules applies to members (section C members) who joined the Fund before 1 August 1985 and did not elect to have their contributions and benefits determined under section B.[4] Contributions are payable by section C members to the Fund calculated as a percentage of a member’s salary depending on age.[5][4] Clause C.1.[5] Clause C.2. A male section C member is entitled upon retirement on or after his Normal Retirement Date (age 65) or death before that date while in the employment of Mitsubishi Motors to payment out of the Fund of a lump sum capital benefit (Normal Retirement benefit) of 12.5 percent of his or her Final Average Salary multiplied by his years of service while a member of the Fund.[6] [6] Clauses C.1, C.3, C.6.
Evidence
Evidence Before The Court
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Decision
Reasons for decision
The relief sought by Mr Kowalski is payment of a TPD Benefit to him. However, if one of the causes of action is made out, the appropriate remedy is that the Trustee be directed to consider the question of eligibility for a TPD benefit according to law. While a court might exercise the discretion and determine eligibility itself if no reasonable person could decide otherwise or if is apparent that the Trustee will not properly exercise the discretion, those criteria are not satisfied on the material before me and in any event on the material before me a medical opinion on the relevant question has not been obtained. The draft statement of claim will need to be amended to seek as the first remedy a declaration that the Trustee breached its fiduciary duty, as the second remedy that the Trustee be directed to consider the question of eligibility for a TPD benefit according to law, and as the third remedy costs.Conclusion I am satisfied that Mr Kowalski has a tenable claim against Mitsubishi Superannuation and/or AMP Superannuation and that permission to institute the proposed action in the District Court should be granted. No suggestion was made that, if it is otherwise appropriate that permission be granted, a distinction should be drawn between Mitsubishi Superannuation and AMP Superannuation who have been jointly represented on this application and in the previous litigation. The relationship between the respondents depends upon the complex provisions of the June 2006 Transfer Deed which can be addressed in the District Court action. I will direct Mr Kowalski to bring forward a draft statement of claim reflecting these reasons.