Baxter and Repatriation Commission - [2000] AATA 196

DECISION AND REASONS FOR DECISION [2000] AATA 196

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N1998/1694

VETERANS' APPEALS DIVISION )

Re REGINALD RYAN BAXTER
Applicant

And REPATRIATION COMMISSION
Respondent

DECISION

Tribunal Senior Member M D Allen

Date13 March 2000
PlaceSydney

Decision The decision under review is affirmed.

(Sgd)                  M D ALLEN
  ..............................................
  Senior Member
CATCHWORDS
VETERANS' ENTITLEMENTS - Special Rate pension. Not necessary for Respondent to show a particular category of employment before Tribunal can be satisfied of ability to work eight hours a week. Applicant had a residual capacity to engage in some employment albeit unspecified.

Veterans' Entitlements Act 1986 - subs24(2A); subss120(4) and (6)

Chambers v Repatriation Commission 36 ALD 207
Repatriation Commission v Smith 15 FCR 327

REASONS FOR DECISION

13 March 2000 Senior Member M D Allen

In this matter the Applicant, pursuant to an application lodged on 24 November 1998, sought review of a determination by the Respondent made 20 August 1997 and affirmed by a Veterans' Review Board on 29 September 1998 that he was not entitled to pension at the Special Rate as prescribed by s24 of the Veterans' Entitlements Act 1986 (the VEA) (as amended).
On 1 April 1993 the Administrative Appeals Tribunal (Deputy President Breen presiding) determined that the Applicant's Meniere's disease was a war-caused disease and that he was entitled to pension at the Intermediate Rate, as prescribed by s23 of the VEA for incapacity occasioned by the war-caused diseases of:
Gun shot wound right chest and right arm
Gun shot wound right thigh
Functional dyspepsia
Anxiety state
Chronic bronchitis
Meniere's Disease.
Subsequently, on 17 July 1997, the Applicant lodged a claim with the Respondent to increase the rate of Disability Pension payable to him to the Special Rate. As the Applicant was born on 24 September 1924 the relevant subsections of s24 are:
"(1)      …
(a)   either:
(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; or
(ii)   …
(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; …
(2A)   This section applies to a veteran if:
(a)the veteran has made a claim under section 14 for a pension, or an application under section 15 for an increase in the rate of the pension that he or she is receiving; and
(b)the veteran had turned 65 before the claim or application was made; and
(c)paragraphs (1)(a) and (1)(b) apply to the veteran; and
(d)the veteran is, because of incapacity from war-caused injury or war-caused disease or both, alone, prevented from continuing to undertake the remunerative work (last paid work) that the veteran was last undertaking before he or she made the claim or application; and
(e)because the veteran is so prevented from undertaking his or her last paid work, the veteran is suffering a loss of salary or wages, or of earnings on his or her own account, that he or she would not be suffering if he or she were free from that incapacity; and
(f)the veteran was undertaking his or her last paid work after the veteran had turned 65; and
(g)when the veteran stopped undertaking his or her last paid work, the veteran:
(i)    if he or she was then working as an employee of another person - had been working for that person, or for that person and any predecessor or predecessors of that person; or
(ii)   if he or she was then working on his or her own account in any profession, trade, employment, vocation or calling - had been so working in that profession, trade, employment, vocation or calling;
for a continuous period of at least 10 years that began before the veteran turned 65; and
(h)section 25 does not apply to the veteran."

The matter came on for hearing before me at Sydney on 3 March 2000. At that hearing the following documents were taken in as exhibits and marked as follows, namely:
T1 – T17: The documents prepared for the Tribunal pursuant to s37 of the Administrative Appeals Tribunal Act 1975

Exhibit A1:     The Applicant's Amended Statement of Facts and Contentions dated 11 August 1999
Exhibit A2:    The report of Dr M Baz dated 5 July 1999
Exhibit A3:    Statement by the Applicant dated 11 May 1999
Exhibit A4:    One page statement by the Applicant, also dated 11 May 1999
Exhibit A5:    Statement by the Applicant dated 10 August 1999
Exhibit A6:    Statement by the Applicant dated 21 September 1999
Exhibit R1:    The Respondent's Amended Statement of Facts and Contentions dated 3 March 2000
Exhibit R2:    Report of Dr P Henke dated 14 August 1999.

In addition, oral evidence was adduced from the Applicant and Dr Baz.

The basis of the Applicant's case was put in Exhibit A1 as follows:
"The Applicant seeks an increase in pension to the Special Rate w.e.f. 31.12.98. He contends that deterioration in his Meniere's Disease caused him to cease work on his Macadamia Farm in December 1998. He relies on the report of Dr M Baz dated 5.7.99."

(The reference to December 1998 should obviously read July 1998, the date 31.12.98 being amended at the hearing to 31.7.98.)

Although the above contention abandons any claim to be entitled to a Special Rate pension as at the application day, namely 17 July 1997, the Tribunal is entitled to assess up to the date of its decision being part of the continuum of the administrative decision making process – see Davies J in Jebb v Repatriation Commission 8 AAR 285 at 289.
The Applicant's work history is varied. After service in the 2nd AIF, the Applicant was employed in a furniture store in Lismore as a salesman. In 1961 he purchased a dairying property and entered into a share-farming agreement. The share-farmer did the bulk of the work but the Applicant used to go to the property each Sunday and perform tasks such as branding, drenching and castrating.
In 1967, the share-farmer left and in 1973 the Applicant converted the property to beef cattle. In January 1973 he resigned from the furniture store and worked and resided on the property from Monday to Thursday. He employed a neighbour as caretaker whilst he was away from the property. In 1975, due to a downturn in beef prices, he returned to work at the furniture store in the position of Manager of the Floor Covering Department. The Applicant described this job as stressful as he had to meet sales quotas.
The Applicant had mentioned to a friend of his, his dissatisfaction with the furniture shop position and, during 1988, the friend made an offer to the Applicant to enter into a partnership selling real estate. That business was less stressful and, as the Applicant put it in Exhibit A3:
"In Real Estate my friend and I started it from scratch, not to make a fortune but to be occupied.
We did not work on week-ends and took it in turns to have days off."

At some time during 1986 or 1987 the Applicant sold the beef property. With the proceeds he purchased a Macadamia Nut Farm in his name and the name of his son.
The Macadamia Farm was run as a partnership with the profits being distributed between the Applicant, his wife and his son in the proportion of one third each (see Document T15). The Applicant acknowledged that there were tax advantages in being a primary producer and, although initially he only attended at the farm on weekends, after the Real Estate Agency was sold in 1988 he and his wife worked on the farm five days a week for three hours a day. He also added that he did not class his time there as work, it being more of a pastime.
Because of his Meniere's disease, the Applicant found it increasingly difficult to carry on as a Real Estate Agent. The Applicant had concentrated on rural land sales which meant that he had to drive to distant properties and he became increasingly afraid of having a motor vehicle accident due to an attack of his Meniere's disease or an attack of vertigo which is associated with that disease. He also found that the setting sun on the road induced attacks of vertigo due to the disease. A side effect of Meniere's disease is hearing loss and tinnitus and the Applicant stated that whereas he was all right on a one to one conversation, he found that he could not hear whilst in a motor vehicle and so could not effectively converse with clients whilst driving.
A decision was made to sell the Real Estate Agency as a going concern. The Applicant was offered employment by the new owner but refused because of his Meniere's disease, stating that if he could have continued as a real estate salesman the agency would not have been sold.
As stated above, after the sale of the Real Estate Agency, the Applicant devoted himself to the Macadamia Farm. In 1998, he was working in the processing shed on the farm when he had an attack of vertigo and was saved from falling on to a conveyer belt by his son who fortuitously was near by. After that incident his son decided it was too dangerous for the Applicant to work in the processing shed, so he ceased involvement with the farm. The Applicant had previously found that he could not undertake outside work on the farm as bending down induced attacks of vertigo. The property has now been transferred to the son.
Labour had to be employed to carry out the duties the Applicant had been performing on the farm. This in turn led to the loss of profits. As the Applicant could no longer contribute to the farm business, his share was made over to his son.
The Applicant stated that, had it not been for his Meniere's disease, he would still have been involved both in real estate and in farming.
Notwithstanding that he is no longer involved in primary production, the Applicant still involves himself in community activities. He is the chairman of the committee of the local Meals-on-Wheels Organisation, and up until last year he carried out publicity activities for baseball in Lismore. This involved writing to the local newspaper and took "a couple of hours" on a Saturday night and up to half an hour midweek and on Saturdays.
Following the local Government elections of October 1999, the Applicant was elected as a councillor to Lismore Municipal Council. As a councillor, he is entitled to receive up to $10,000.00 per annum for sitting fees. Council meetings are held every three weeks except for January, and the Applicant is a member of three sub-committees each of which meets for two hours a month. In addition, he has to attend to calls from constituents and make site inspections.
Mr Sherlock, for the Applicant, submitted that these activities did not amount to eight hours per week and this may be so. However, I doubt if the Applicant would elsewhere describe his position as a councillor as a sinecure and that he is capable of carrying out this type of activity, is evidence of a capacity to engage activity being activity for which he is remunerated.
Since the Applicant ceased work at the Macadamia Farm, he has been prescribed Stemetil by his general practitioner. He has not had an acute attack of Meniere's disease since then (see Dr Baz's report). My understanding of the Applicant's evidence is that he does get attacks of vertigo if rising suddenly or bending down. He has wisely refrained from driving a motor vehicle except for very short distances. As pointed out by Dr Baz, because of his Meniere's disease, he would not be entitled to a Public Transport Driver's Licence. He has hearing loss and constant tinnitus.
Dr Baz opined that the Applicant, because of his accepted disabilities alone, is incapable of working eight hours per week. Cross-examined, she stated that there was nothing in the Applicant's disabilities which would stop him working eight hours per week in a clerical capacity. In re-examination, she stated that she could not envisage the Applicant working in the retail area, particularly in furniture which would require him to bend down in order to show customers the details of furniture. She did not know of any particular employment which the Applicant could undertake given his disabilities. Although he had some clerical capacity, his deafness would make answering the phone difficult.
Exhibit R2 is the report of Dr Henke, a consultant rehabilitation medicine as is Dr Baz. Under the heading of "Work Fitness", Dr Henke opined:
"This man's main form of business was that of conducting a real estate agency mainly involving rural property. He worked in this business through until 1985. It should be acknowledged that his Meniere's disease created difficulty for him in that there would have been periods of time on an intermittent and unpredictable basis in which he would have had difficulty in performing his full range of duties.
…
I would therefore have been of the view that if considering his accepted disabilities, this man would have remained capable of working in excess of eight hours but less than twenty hours per week carrying out his duties as a Real Estate Agent. I do not believe that he would have been suitable for carrying out work as a Farmer/Grazier by virtue of some of the risks associated with the Meniere's disease and to a lesser degree his lung problems."

The Respondent submitted that the Applicant did have a residual ability, both at the application day and at present, to engage in some form of remunerative work. Remunerative work is defined in s5Q of VEA as: "'remunerative work' includes any remunerative activity".
What is clear from the material before me is that the Applicant, although over the age of 65 at the time he made his application for a Special Rate pension, had been engaged in remunerative work, namely that of a primary producer on his own account for a continuous period before he turned 65, exceeding 10 years and that, as a result of his Meniere's disease, he suffered a loss of earnings which he would not have suffered had he not been suffering from that disease. Because of his Meniere's disease the Applicant ceased involvement with the Macadamia Farm and hence lost remuneration. Even if the Applicant had continued as a share-farmer, the fact the partnership had to employ workers on wages to undertake the work the Applicant had contributed to the farm means that there was a loss of profit to the partnership and hence a loss of remuneration to the Applicant.
The question the Tribunal must decide is whether the Applicant was incapable of undertaking remunerative work for periods aggregating more than eight hours per week.
Mr Wallis, for the Respondent, maintained that, given the Applicant's activities as a Local Government Councillor and the report of Dr Henke, the Tribunal could not be reasonably satisfied that the Applicant was incapable of remunerative work exceeding eight hours but being less than 22 hours per week. Mr Sherlock, for the Applicant, submitted that the Respondent must show a specific type of employment category that would accommodate the Applicant in the community in which he resided before it could be said that the Applicant had a residual ability to engage in remunerative activity exceeding eight hours a week.
At the outset it must be pointed out that, pursuant to subs120(6) of the VEA, there is no onus upon either party to prove any particular matter in applications under the VEA. Subs120(4) provides that for the Applicant to succeed, the Tribunal must decide the entitlement of the Applicant to pension at the Special Rate to its reasonable satisfaction. In Repatriation Commission v Smith 15 FCR 327 the Full Court of the Federal Court equated the expression "reasonable satisfaction" to proof on the balance of probabilities.
I reject the submission that before I can be reasonably satisfied that the Applicant cannot work eight hours a week, a particular category of employment must be demonstrated by the evidence adduced.
Section 28 of the VEA reads:
"Capacity to undertake remunerative work
In determining, for the purposes of paragraph 23(1)(b) or 24(1)(b), whether a veteran who is incapacitated from war-caused injury or war-caused disease, or both, is incapable of undertaking remunerative work, and in determining for the purposes of section 24A whether a veteran who is so incapacitated is capable of undertaking remunerative work, the Commission shall have regard to the following matters only:
(a)the vocational, trade and professional skills, qualifications and experience of the veteran;
(b)the kinds of remunerative work which a person with the skills, qualifications and experience referred to in paragraph (a) might reasonably undertake; and
(c)the degree to which the physical or mental impairment of the veteran as a result of the injury or disease, or both, has reduced his or her capacity to undertake the kinds of remunerative work referred to in paragraph (b)."

The application of s28 was discussed by the Full Court of the Federal Court in Chambers v Repatriation Commission 36 ALD 207. At p210 Davies said:
"Paragraph (c) of s 28 of the Veterans' Entitlements Act also requires that there be consideration of the degree to which the physical or mental impairment of the veteran as the result of the injury or disease, or both, has reduced his or her capacity to undertake the kinds of remunerative work referred to in para (b). But the words 'the degree' do not require a determination of a percentage. Section 24 is concerned with the issue of whether the veteran is incapable of undertaking remunerative work for periods aggregating more than eight hours per week. That is the degree spoken of. The combined operation of ss24 and 28 and the reference in s 28 to 'the following matters only' show that the sections intend that the degree of impairment must be such as, of itself, to have reduced the veteran's capacity to undertake remunerative work for periods aggregating more than eight hours per week.
In paras (a) and (b), attention is directed to the skills, qualifications and experience of the veteran for the purpose of determining the kinds of remunerative work which a person with those skills, qualifications and experience might reasonably undertake. That ambit of capacity for remunerative work is then the starting point from which the degree of reduction in work capacity by reason of the physical or mental impairment of the veteran is measured. As Moore and Sackville JJ point out, paras (a) and (b) should be applied not technically or restrictively but sensibly and fairly with a view to ascertaining the kinds of remunerative work which the veteran might reasonably undertake absent the war-caused injury or disease. Work experience is a guide but it does not delimit that ambit.
Necessarily, in the examination of the matters which arise under para (c), matters other than skills, qualifications and experience are taken into account. Every fact which bears upon the nature and extent of the physical and mental impairment of the veteran must be taken into account. And so also must every fact which bears upon the extent to which the physical or mental impairment has reduced the veteran's capacity to undertake remunerative work of the kind which the veteran might reasonably undertake."

At p 218 Moore and Sackville JJ stated:

"It may be accepted that s 28 focuses the inquiry that s 24(1)(b) would otherwise require. As Davies J pointed out in Re Thomson and Defence Force Retirement and Death Benefits Authority (1987) 6 AAR 424 (AAT), at 430-1, in relation to the equivalent provision in the 1973 Act, the effect of s 28 is to exclude a number of matters which otherwise might have been relevant to the determination required by s 24(1)(b). Such matters as depressed labour market conditions are excluded from consideration for the purposes of s 24(1)(b) …"

In this matter the Applicant has various attributes which indicate that he has a residual ability to engage in some form of employment. As Dr Baz points out, he could work in excess of eight hours a week in a clerical capacity if such a job were available. Dr Henke thinks real estate is a viable option and, although Dr Henke may not have taken into account the Applicant's inability to drive, his opinion is evidence of some capacity to work.
Taking an overall view of this matter I find that, whereas the range of employments open to the Applicant are restricted, I cannot be reasonably satisfied that he is incapable of undertaking some remunerative employment (or employments) which aggregate more than eight hours per week. The decision under review is therefore affirmed.
I certify that the 32 preceding paragraphs are a true copy of the reasons for the decision herein of:
Senior Member M D Allen
Signed:         Ivanka Mamic           .....................................................................................
  Associate
Date/s of Hearing  3 March 2000
Date of Decision  13 March 2000
Solicitor for Applicant                 Mr R Sherlock, Legal Aid Commission
Advocate for the Respondent    Mr R Wallis, Department of Veterans' Affairs