BARRY MANN and REPATRIATION COMMISSION

[2009] AATA 804

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 804

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2009/1058

VETERANS’ APPEALS DIVISION		)
Re		BARRY MANN

Applicant

And REPATRIATION COMMISSION

Respondent

DECISION

Tribunal M J Carstairs, Senior Member

Date15 September 2009

PlaceBrisbane

Decision For reasons given orally after the hearing, the Tribunal affirms the decision under review.

...................[sgd]................

Senior  Member

CATCHWORDS

VETERANS’ AFFAIRS – veterans’ entitlements – special rate of pension – remunerative work – whether prevented from continuing remunerative work – decision under review affirmed.

Veterans’ Entitlements Act 1986 (Cth), ss 23, 24

Cavell v Repatriation Commission (1988) 9 AAR 534
Flentjarv Repatriation Commission (1997) 48 ALD 1
Forbes v Repatriation Commission (2000) 101 FCR 50
Leane v Repatriation Commission (2004) 81 ALD 625
Repatriation Commission v Hendy (2002) 76 ALD 47

REASONS FOR DECISION

15 September 2009 M J Carstairs, Senior Member

1.      Barry John Mann has applied for an increase in the rate of his disability pension.  The respondent assessed Mr Mann as eligible for payment at 100% general rate of pension and he now seeks the higher loss-of-earnings related payment, referred to in the Veterans’ Entitlements Act 1986 (“the Act”) as the “special rate”.   

2.      The respondent has accepted that the following conditions of Mr Mann arose from his service:   

·Bilateral sensorineural hearing loss with tinnitus;

·Mandible cysts due to incisor trauma;

·Haemorrhoids;

·Effects of trauma and mandibular cyst on the four incisor and two canine teeth in the anterior mandible;

·Solar keratosis legs, arms/hands, trunk, neck and head; and

·Post-haemorrhoidectomy urgency faecal incontinence

3.      Entitlement to special rate of pension requires, amongst other things, that a person is prevented by reason of war-caused disability or disabilities from continuing to undertake remunerative work and prevented from working more than eight hours per week.  The respondent says that Mr Mann is not entitled to special rate of pension because he ceased work for reasons other than war-caused incapacity.  Also, the respondent says, Mr Mann has been effectively out of the workforce for a number of years so that now matters such as his age and time out of the workforce are relevant.

ISSUES

4. The issue before the tribunal is whether Mr Mann satisfies s 24(1)(c) of the Act, which breaks down into two questions:

§whether Mr Mann is, by reason of incapacity from his war-cased disabilities alone, prevented from continuing to undertake remunerative work that he had been undertaking; and

§whether he is consequently suffering a loss of wages or earnings on his own account which he would not be suffering if he were free of that incapacity.

5.      

I will now say something more of the legislative provisions, noting those matters that were not contested. The parties agreed that Mr Mann passes some of the legislative requirements. His general rate entitlement is greater than 70%, thus satisfying s 24(1)(a) of the Act. Also, the parties agree that he satisfies

s 24(1)(b) of the Act by being unable to work more than eight hours per week by reason of his war-caused disabilities alone. I am reasonably satisfied that the concession in regard to s 24(1)(b) was properly made, in the light of the medical evidence in the case. That evidence comes primarily from Dr G Mitchell, an associate professor in general practice, who stated that Mr Mann could not work at all.[1] 

[1] T-docs, page 88.

6.      

Other evidence was less categorical.  Dr R Stitz, colorectal surgeon, appears to have thought that Mr Mann had a residual capacity for part-time work.  In a report dated 5 December 2005, Dr Stitz said that, subject to the provision of  suitable toilet facilities, Mr Mann could work part-time (at least).[2]  Dr Stitz later reported that Mr Mann was unable to work between 8 and 20 hours per week,[3] suggesting (to my mind) that he considered Mr Mann capable of working up to eight hours per week. I had a sense that Mr Mann would not entirely disagree with that. In that regard, Mr Mann said in his evidence that he believed he could manage his disabilities if he were carrying out home-based work. He said he could complete two-hour periods of work if they were separated by breaks, as needed. However, in view of the respondent’s concession that s 24(1)(b) of the Act was met and taking into account that no medical evidence was called by either side that might resolve Dr Stitz’s more ambivalent remarks, I am prepared to accept that Mr Mann satisfies

s 24(1)(b) of the Act.

[2] T-docs, page 12.

[3] T-docs, page 32.

7. There ended the matters agreed by the parties. The evident area of their disagreement was with respect to s 24(1)(c) of the Act. That provision, broadly speaking, deals with whether the reason(s) Mr Mann was not in remunerative work during the “assessment period” is attributable to service-related incapacities or to other factors. The “assessment period” started from the date of the claim, 18 May 2006.

8. I note here that s 24(2)(b) of the Act ameliorates the operation of s 24(1)(c) for those aged under 65 years who might not have met the special rate tests at the time they ceased working. Such veterans retain their eligibility if they are genuinely seeking work and their service-related incapacity remains the substantial cause of their inability to obtain remunerative work. Mr Mann gave some evidence about his continued work efforts, so some consideration needs to be given to s 24(2)(b) of the Act.

BACKGROUND

9.      I shall now set out the facts as I see them.  At the time of the claim, Mr Mann was just short of 65 years of age.  He had undertaken a mixture of employment in his working life.  He was employed for some 20 years in the Royal Australian Air Force (“RAAF”), including a period serving with the United Nations in India and Pakistan in 1978.  His time in the RAAF was not relied upon as being his “remunerative work”—understandably, as it was long ago and because the evident reason for his discharge was taking his entitlement to pension after having completed 20 years of service.

10.     Mr Mann received technical training in the RAAF and obtained qualifications in electronics, which he then utilised in civilian employment.  I rely on his statements for his relevant work history.[4]  There appears to be no doubt that Mr Mann’s bowel disability caused his loss of employment as a sales representative in about 1992.  While so employed, his need for self-care meant that he had to cancel scheduled work appointments without notice. Although Mr Mann was given no reason for his dismissal from that employment at the time, it makes sense that his employer would have found that Mr Mann’s medical conditions were not helping business.  Mr Mann’s next substantial period of employment, as a self-employed handyman gardener, was from 1992 to 1997.  He described this business as flourishing and slowly growing to about 30 hours per week (heading towards full-time) until about 1995, when his hours started to decrease.  Again, Mr Mann was cancelling clients to return home for self-care purposes; it became impossible for him to keep the business running. 

[4] See exhibits A1 and A2.

11.     There is no question that Mr Mann has an intractable and disabling bowel condition that makes holding down any kind of employment difficult. As an employee, he requires a very understanding boss.  His medical condition results in numerous unpredictable absences. 

12.     I note that the evidence of when remunerative work ceased shifted as the case progressed.  Up to the Veterans' Review Board hearing, Mr Mann was saying that his remunerative work ceased in 1997 when the home handyman business closed down—due, as I accept, to the disabling bowel condition.  His evidence at the Tribunal was that he had proposals for other businesses, for one of which he and his wife registered a business name and obtained an ABN.

THE FLENTJAR TESTS

13. Decision-makers have come to examine the questions in s 24(1)(c) of the Act by applying a four-step analysis, commonly referred to as the Flentjar tests, set out in the Full Federal Court decision of Flentjarv Repatriation Commission.[5]

[5] (1997) 48 ALD 1.

14. The Flentjar decision, per Branson J, with whom Beaumont and Merkel JJ agreed, described s 24(1)(c) of the Act as posing the following tests:[6]

1.        What was the relevant "remunerative work that the veteran was      undertaking" …?

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?

[6] (1997) 48 ALD 1 at 4-5.

15.     I will now consider Mr Mann’s matter by examining relevant facts in the light of the four Flentjar tests.

What remunerative work was Mr Mann undertaking?

16.     Given the occupations Mr Mann has undertaken, his remunerative work is best described as a range of light to heavy unskilled or semi-skilled work both in paid employment and also while running his own small artisan businesses (as stated above, his period in the RAAF does not arise for consideration).  I have described his relevant remunerative work more widely than did Mr Jarro, counsel for Mr Mann, in submissions.  Mr Jarro submitted that the work was confined to labouring type duties.  However, to my way of thinking, that does not recognise that there were quite different aspects than merely labouring in the mix of work Mr Mann undertook, or seriously attempted.

Is war-caused disability preventing Mr Mann from continuing to undertake remunerative work?

17.     The medical evidence strongly supports a conclusion that, from the start of the assessment period, war-caused disabilities prevented Mr Mann from continuing to undertake remunerative work.  The evidence of Drs Stitz, Mitchell and Tankey satisfies me of that, and that conclusion also appears to have been conceded by the respondent as it is not addressed in any real sense in  written submissions. 

18.     So, this Flentjar test can be answered “yes” for the entirety of the assessment period.

Is war-caused disability the only factor preventing Mr Mann undertaking remunerative work?

19.     Mr Mann has not worked effectively since the late 1990s.  I note that period is referred to by Mr Jarro in submissions as the date Mr Mann last undertook remunerative work.  I accept that submission as reflecting the reality of the position.  The later business propositions that Mr Mann referred to in his evidence do not appear to have got off the ground in any real sense.

20.     On Mr Mann’s own evidence, his business attempts after the late 1990s were unsuccessful. His time with Trilby Outfitters (a manufacturer of pet accessories) came to an end because the business was not viable, being unable to compete with cheaper imports.  As I understood Mr Mann’s evidence, if the business had been viable it would have been ideal for him because it made possible home-based work and regulated hours.  Such work would not have been full-time.   Mr Mann cited the same reasons for not proceeding with another home-based business, which produced metal ornaments.  Mr Mann investigated that business but did not become involved with it to the same extent he was involved with Trilby Outfitters.

21.     As the Federal Court pointed out in Cavell v Repatriation Commission,[7] a commonsense approach must be taken when looking at the issues raised by s 24 of the Act.

[7] (1988) 9 AAR 534.

22.     I am satisfied that Mr Mann’s last remunerative work was the handyman business.  I accept that Mr Mann’s bowel disability prevented him from continuing in self-employment as a handyman gardener.  His medical condition was clearly a great impediment to him carrying out that kind of work because he rarely had access to toilet facilities (he worked at private houses).  However, it is important to remember that the test for entitlement to special rate of pension is not focussed on the date that the veteran gave up work; nor does the “remunerative work” referred to in the second Flentjar test have to be the last work undertaken.  

23.     

As pointed out in Forbes v Repatriation Commission,[8]

s 24(1)(c) of the Act is best understood by dividing it into its two limbs (as stated in paragraph 4, above) and relating those limbs to the sub-sections that follow—that is s 24(2)(a) and (b) of the Act. Section 24(2)(a) is to be related to the second limb;

s 24(2)(b) to the first.

[8] (2000) 101 FCR 50.

24. Section 24(2)(b) of the Act deems the first limb to have been met in respect of certain veterans aged under 65 years. However the benefit of this provision can only be taken where a veteran has been genuinely seeking to obtain remunerative work in the assessment period but has been unable to do so (or to continue to do so) substantially because of incapacity from war-caused injury or disease. The submissions did not address s 24(2)(b) of the Act but my own conclusions are as follows below.

25.     I do not accept that the facts here allow a conclusion that Mr Mann was “genuinely seeking to engage in remunerative work” in the assessment period.   Mr Mann may have been keeping an eye out for work in a general sense but I am mindful of what he told the Veterans' Review Board: his pursuits amounted to driving around, thinking about whether he could do a particular job, and then thinking about whether such a job might be ruled out because of lack of ready toilet facilities.  In his evidence before me, Mr Mann said that he did apply for some positions and named Australian Meat Holdings at Dinmore and the Ipswich Abattoir Board as businesses he approached. However, I did not understand him to be saying that these applications were made within the assessment period.  

26.     I accept that Mr Mann certainly wanted to maintain himself in employment during his fifties and I can accept that he would have liked to work until a normal retirement age (he said he had as an example his father who worked until age 70).  However, the evidence suggests that the end of Mr Mann’s employment efforts occurred in 2003 at the very latest, when he started receiving carer pension for the care he gives to his wife.  Before 2003, his efforts were minimal (the evidence in this regard was of a most general nature).

27. The third Flentjar test refers to the “alone” test in s 24(1)(c) of the Act, which requires a practical decision on whether the veteran’s loss of remunerative work is attributable to service-related incapacities alone and not to something else as well. If a non service-related factor contributes to the veteran’s inability to work or to obtain and hold remunerative work, that factor is sufficient to displace the veteran’s case for pension at the special rate.

28.      The correct approach to that test is set out by the Full Federal Court in Repatriation Commission v Hendy:[9] 

36. The tribunal's task was to assess what the veteran probably would have done, if he had none of his service disabilities during the assessment period. The requirement to consider "remunerative work that the veteran was undertaking" does not mean a particular job with a particular employer but the substantive remunerative work that the veteran had undertaken in the past … The tribunal was not bound to limit its consideration to the last employment that the veteran actually undertook.

37. The consideration of what a veteran would probably have done, absent the service disabilities, is a hypothetical exercise. The language of s 24(1)(c) of the Act directs attention to the question of whether incapacity from the relevant condition alone prevents a veteran from continuing to undertake remunerative work. The provision does not contemplate that other factors are only to be taken into account if they, of themselves, prevent the veteran from working. The decision-maker is required to take into account any factor that plays a part or contributes to a veteran's being prevented from continuing to engage in remunerative work. If a period of time elapses after a veteran ceases remunerative work and before the commencement of the assessment period, lack of recent work experience, time out of the workforce and increasing age will be relevant for consideration under s 24(1)(c) of the Act. The decision-maker is required to consider the effect, contribution to, and relative weight to be attached to any or all of those factors during the assessment period. So long as the tribunal performs this exercise, the conclusions drawn from the assignment of the relative impact the various factors on the ability of the veteran to continue in remunerative work is not reviewable, except in exceptional circumstances. Moreover, having considered any or all of the factors which may have contributed to a veteran's incapacity, the tribunal is then required to determine whether it is the veteran's war-caused injury or war-caused disease, or both, alone which prevent the veteran from continuing to undertake remunerative work.

[9] (2002) 76 ALD 47 at 54-55 [36]-[37].

29.     The Full Court of the Federal Court emphasised in Leane v Repatriation Commission[10] that a person is not seeking remunerative work if they merely have a wish or desire; they have to make a genuine attempt. That attempt or those attempts are, relevantly, ones undertaken during the assessment period. The steps must be genuine and they must be undertaken. I formed the impression that Mr Mann had stopped looking for work before the assessment period for a number of reasons, one of which was to have time to care for his wife each day. Nothing he said that sought to minimise either her need for care or the level of care that he in fact gives convinced me that his caring duties were not a factor impacting on his ability or desire to look for work. That is, I find that Mr Mann made no attempt to re-engage in remunerative work during the assessment period and that, as a consequence, he cannot satisfy s 24(2)(b) of the Act.

[10] (2004) 81 ALD 625.

30.     I am satisfied that at the start of the assessment period, and throughout it, factors other than war-caused disability prevented Mr Mann from undertaking remunerative work. Consequently, Mr Mann is unable to pass the third Flentjar test. These “other factors” were primarily his age (very close to what is the normally accepted retirement age), his time out of the workforce (he has had little significant employment since the late 1990s) and his duties as a carer for his wife.

The fourth Flentjar test

31. Even if I am wrong in the conclusion I reached in relation to the third Flentjar test, Mr Mann fails on the test set out in the second limb of s 24(1)(c), read with s 24(2)(a) of the Act.

32.     In considering the fourth Flentjar question, the commonsense approach to evidence recommended in the Cavell case is necessary.  Relevantly, factors other than his war-caused disabilities now do prevent Mr Mann from engaging in remunerative work again; factors including his age, his time out of the workforce and his carer role.  I regard the evidence he gave to the Veterans' Review Board about his carer role and its demands on his time as a more accurate account than that given to me at the hearing.  At the hearing, Mr Mann sought to minimise the time spent on and the home based nature of that care.

33.      It is generally recognised that someone who is close to being 65 years of age, as Mr Mann was at the start of the assessment period, is for that reason alone unattractive to a potential employer—quite apart from any disabilities.  When Mr Mann’s age is combined with time involved in caring for his wife (whose care needs are unpredictable), it can be seen that Mr Mann would be suffering the same loss of salary, wages or earnings even if he were free of his war-caused disabilities.  As to possible self-employment, Mr Mann gave evidence that the reason he did not pursue some ventures was that he could not compete with cheaper labour costs of similar goods produced in Asian countries.  So in that regard, the failure of those business ventures was not due to Mr Mann’s disabilities alone. 

34. Therefore when we ask the questions necessitated by s 24(2)(a) of the Act—that is, are there any reasons in addition to the acknowledged war-caused incapacities that account for Mr Mann no longer being in remunerative work—the only commonsense answer is that there are such other reasons. Being nearly 65 years of age and having been some time out of the workforce caring for his wife, Mr Mann would have been prevented from being in remunerative work even if he did not have his war-caused disabilities.

35. Although the alternative case was not pressed before me, I would also note that, for the same reasons, Mr Mann cannot satisfy the requirements for intermediate rate of pension, set out in s 23 of the Act, as the critical tests are identical to those discussed above.

DECISION

36.     Accordingly, for the reasons given orally, the Tribunal affirms the decision under review.

I certify that the 36 preceding paragraphs are a true copy of the reasons for the order herein of M J Carstairs, Senior Member.

Signed ……………[sgd]…….…………………          
  Mátyás Kochárdy, Associate

Dates of Hearing  14 & 15 September 2009
Date of Decision  15 September 2009
Date of Written Reasons                20 October 2009
Counsel for the Applicant               Mr Nathan Jarro
Solicitors for the Applicant              Cockburn Legal & Consulting

Solicitor for the Respondent         Ms Leisa Pendle, Australian Government Solicitor