Coleman and Repatriation Commission - [2000] AATA 259

DECISION AND REASONS FOR DECISION [2000] AATA 259

ADMINISTRATIVE APPEALS TRIBUNAL )

) No V97/1042

VETERANS APPEALS DIVISION        )
           Re      JOHN EDWARD COLEMAN
  Applicant
           And    REPATRIATION COMMISSION
  Respondent

DECISION

Tribunal Mr J. Handley, Senior Member

Date4 April 2000
PlaceMelbourne

Decision      The decision under review is affirmed.
  ………………………
  Senior MemberVeterans' Entitlements: Applicant self-employed; multiple war caused injuries; number of injuries not claimed which impact on ability to work and earn; whether an entitlement to special rate pension; whether the 'alone' test satisfied; whether loss of remunerative income by war caused injuries; decision affirmed.

Veterans' Entitlements Act 1986 ss.23, 24, 24(2A), 31

Keeley v Repatriation Commission (2000) 30 AAR 5

REASONS FOR DECISION

4 April 2000 Mr J. Handley, Senior Member

The respondent made a decision on 20 February 1996 to pay pension to Mr Coleman at 60% of the general rate with effect from 8 September 1995. The Veterans' Review Board ("the VRB") varied that decision on 8 July 1997 and decided that pension be paid at 90% of the general rate from 12 May 1996. The applicant applied to review the latter decision.
The applicant, subsequent to the above dates, made an application by his RSL delegate upon the respondent pursuant to s.31 of the Veterans' Entitlements Act 1986 ("the Act") to increase the rate of general rate Pension. On 6 October 1997 a delegate of the respondent determined that pension be paid at 100% of the General Rate with effect from 12 May 1996.
Proceedings in this Tribunal commenced by an application on 28 August 1997. The application then lodged was to challenge the decision made by the VRB on 8 July 1997. At the time of lodgement of the application the applicant was entitled to 90% of the general rate. At all relevant times the application to this Tribunal was to have the rate of pension increased. Initially the applicant sought pension payable at 100% of the general rate however when it was learnt that the applicant had in fact been in receipt of pension at 100% of the general rate, the claim changed to be an application for either extreme disablement adjustment or special rate pension. Later the applicant sought special rate pension.
Despite the application having commenced in August 1997, the applicant sought an adjournment from a hearing on four occasions either by reason of not being ready to proceed, or not having complied with Directions of the Tribunal or by reason of injuries which had not previously been decided as war-caused being subject to a hearing before the VRB.
After the application was listed for hearing (for the forth time) on 25 February, the applicant's solicitors again sought an adjournment because the VRB had adjourned a hearing of a proceeding before it in January pending a Full Federal Court appeal in the case of Keeley v Repatriation Commission (2000) 30 AAR 5. Additionally the VRB had made a decision with respect to a condition of gastro-oesophageal reflux, which it decided was not war-caused. The applicant lodged an appeal against that decision on 24 February 2000 being the day before the hearing. (application V2000/218).
Having regard to the number of occasions upon which this application had been listed for a hearing (and the number of times that it had been adjourned) I refused the applicant's request for an adjournment from the hearing on 25 February. It was said that the applicant suffered from a "breathing disorder" which doctors had been unable to diagnose in the preceding 18 months. It was said that that condition was principally responsible for the applicant's incapacity to work and to earn remunerative income. It was submitted that the applicant could not succeed in his claim for special rate pension before the Administrative Appeals Tribunal unless that condition was either conceded by the respondent or was found by the VRB to be war-caused.
I refused the applicant's request for an adjournment. I was influenced by the number of occasions that the application had been listed for hearing and the inability of the applicant's representatives to be ready to proceed to hearing on the earlier occasions. I also refused a request by the applicant to stand down and reconvene the hearing with a differently constituted Tribunal. Despite the applicant's solicitor indicating that he intended to proceed to the Federal Court to seek an Order to prohibit the continuity of the proceedings, he did not persist with the application, he requested time to obtain instructions and upon the application resuming the applicant's solicitor indicated that he and his client intended to proceed with the review that was listed for hearing on 25 February.
Had there been a thorough preparation for the hearing and a comprehension of the issues surrounding the application for special rate pension, this application would not have proceeded. It was a tragedy that the application proceeded as far as it did. Issues emerged during the hearing, which should have been known to the applicant's solicitors. Mr Coleman should never have been put into the position that he was on the day of hearing. It should have been made abundantly clear to him that he had a number of problems, which were insurmountable in his pursuit for special rate pension.
The Legislation
Entitlement to special rate pension is determined under s.24 of the Act. It provides that where the degree of incapacity from war-caused injury or disease has been determined to be at least 70% and the veteran is totally and permanently incapacitated by war-caused injury or disease, alone, to render him incapable of undertaking remunerative work for periods aggregating more than 8 hours per week and, by reason of incapacity from war-caused injury or disease, alone, prevented from undertaking remunerative work and is suffering a loss of salary or wages or of earnings that would not have been suffered were it not for incapacity, the Veteran shall be entitled to special rate pension. The entitlement for special rate pension is also qualified by amendments to the Act in 1994 (refer s.24(2A). For the purposes of the present application Mr Coleman was more than 65 years of age at the time he made his application and had been in continuous self employment for at least 10 years before he achieved the age of 65 years.
It was not even clear at the hearing whether the applicant was in fact seeking special rate pension or intermediate rate pension or both. The application initially was to recover special rate pension however despite a report being received from Dr Stone at the request of the applicant which certified that he was unable to work more than eight hours per week the applicant's solicitor filed a Statement of Facts and Contentions asserting an entitlement to intermediate rate pension. On the morning of hearing the claim asserted by the solicitor was for special rate pension. It would appear from the evidence heard and from the submissions made at the conclusion of the hearing that the applicant's solicitor sought intermediate rate pension for a limited period and subsequently for special rate pension (having regard to the reduction in the hours of self employment).
The facts and circumstances concerning the applicant's self employment, the hours that he worked and did not work, the reasons for him not working and the occasions when he reduced his working hours remain unclear.
Those facts which were not in contention were as follows-
The applicant suffers from war-caused disabilities of malaria, bilateral sensori neural hearing loss, amputation of a toe of the right foot, post traumatic stress disorder and peptic ulcer disease.
Injuries or diseases, which have been found not to be war-caused, are duodenal ulcer, 'breathing problems' and gastro oesophageal reflux disease.
Mr Coleman served as a member of the Australian Army at Milne Bay in the Second World War. He said that the Japanese forces had evacuated Milne Bay before his arrival however he was involved in the construction of field hospitals for which he worked long hours in hot tropical conditions. He commenced a habit of smoking cigarettes during service.
After discharge from service Mr Coleman was employed delivering ice. Since 1960 he has been self-employed in a nursery and sand supply business. Recently the business has been divided and that part of it which concerned the sale and delivery of sand and garden supplies has been sold. Mr Coleman has subsequently only been concerned with the propagation and sale of plants. The business trading as "Coleman's Nursery" is owned by Wenjac Pty Ltd. The share holders of Wenjac are Mr Coleman, his wife and his daughter.
Mr Coleman said at the hearing that his working hours had been considerably reduced in the last three or four years by reason of his post traumatic stress disorder and his inability to sleep because of nightmares. He also said that he has become progressively breathless. He said that Mr Paine, a respiratory specialist at the Royal Melbourne Hospital and Professor Harper, a cardiologist, had given differing opinions as to the cause of his breathlessness. He said that he had been advised by former physicians that his breathlessness was also related to his anxiety. It would appear that both Mr Paine and Professor Harper found an association between his breathlessness and his heavy consumption of cigarettes, yet at the day of hearing the breathlessness remained undiagnosed and it was not an accepted disability.
Mr Coleman said in recent years his anxiety and general malaise (by reason of his insomnia) had caused him to virtually have no contact with members of the public. He has also withdrawn from work in the nursery and has engaged casual staff. He said the business had become unprofitable and by reason of his injuries he was unable to propagate plans and instead was buying stock.
Whilst I have no doubt that Mr Coleman – who I found to be a witness of truth and who gave his evidence in a frank and forthright manner – suffers principally from his post traumatic stress disorder, he also suffers from a number of conditions which have apparently not been the subject of applications to the respondent and which upon his evidence interfere with his capacity for work. These conditions are dizziness, cataracts, varicose veins, leg ulcers, arthritis in his knees and lower back pain. He walks with a walking stick which apparently assists him to remain upright having regard to his knee injuries and reduces the risk of him falling by reason of his dizziness. He also said that he suffers from poor circulation in his legs which when combined with his varicose veins and dizziness and arthritic knees prevent him from standing and propagating plants.
Whilst I have no doubt that the post traumatic stress disorder is a major factor in his inability to work and therefore earn remunerative income I cannot overlook the considerable number of other injuries which have not been the subject of a determination by the respondent and which do contribute to his inability to work and earn remunerative income. It follows that I cannot be satisfied that Mr Coleman is totally and permanently incapacitated by reason of war-caused injury or war-caused disease, alone, which renders him incapable of undertaking remunerative work for periods aggregating more than 8 hours per week.
None of the above injuries should have emerged and become known during the hearing. All of these conditions should have been known to the applicant's solicitor and should have been properly investigated and/or have been the subject of earlier claims upon the respondent.
The applicant's solicitor submitted that the "preponderance of the evidence point to the post traumatic stress certainly being the major factor in the inability to carry on with employment, and certainly inability to carry on with full-time employment on the nursery".
I understood this submission to mean that the major reason why the applicant could not work was because of his accepted disability of post traumatic stress disorder. I do not understand that this submission made by the applicant's solicitor satisfies the "alone" test and I know of no authority which permits exclusion of other injuries or diseases which are not war-caused and which clearly have an impact upon capacity for work. Individually they may not amount to the severity or have the effect of the post-traumatic stress disorder, nonetheless the dizziness and the arthritis of the knees clearly have had a significant affect upon the applicant's ability to work. On his own evidence he needs to use a walking stick to ensure he does not fall by reason of the dizziness and the instability in his knees. The work previously carried out by Mr Coleman in his nursery principally involved standing and walking which he is now largely unable to do by reason of the dizziness and the leg injuries.
Even in the absence of the above injuries and the applicant's inability to satisfy the "alone" test under s.24, I could not be satisfied on the evidence heard and from the tax returns read that Mr Coleman was able to demonstrate a loss of earnings or salary or wages that he would not have suffered were it not for his incapacity.
Income tax returns were filed shortly prior to the hearing for the financial years 1995, 1996, 1997 and 1998 for the company Wenjac Pty Ltd and Mr Coleman personally.
Mr Coleman was asked to "make a guess" on the amount that he has lost from 1995 to the present time. He said it was "about $100,000". Mr Coleman said that he could attribute this loss to his inability to carry out his work at Coleman's nursery and acknowledged that that loss could not necessarily be translated into his taxation returns. He said that loss was associated with him being unable to produce plants by propagation, having to employ staff and having to buy plants to maintain stock.
The Income Tax Returns do not reflect the above assertions. The profit and loss statements attached to the Income tax returns of Wenjac describe "Purchases – Plants" in each of the four above financial years. Between 1995 and 1998 there has been a decreasing amount spent each year on the purchase of plants. A summary from the returns with respect to the cost of purchase of plants described as a 'cost of goods sold' and deducted from the gross income is as follows-
1995 – $112,393
1996 - $102,151
1997 - $96,883
1998 - $81,608
As is referred above I understood Mr Coleman to say that as his incapacity became greater he became less able to propagate plants, the amount spent on purchase of plants increased and his net income decreased. The above figures indicate that the amount spent on the purchase of plants for stock has decreased in each of the four years.
It was also said that there is a loss of remunerative income because Wenjac incurred additional costs in the payment of salaries and wages. This is also not apparent from the profit and loss statements. Those statements show that the amount spent on wages has decreased in each of the above four years. The amount spent for wages in each of the four years was recorded in the returns as follows-
1995 - $38,542
1996 - $31,310
1997 - $22,775
1998 - $19,190.
I am unable therefore to find that Mr Coleman has received a lesser amount of remunerative income by reason of the increased cost of stock and labour during the relevant years when, in those same years, the amount spent on stock and labour has decreased.
It would appear from the returns on Wenjac that the returns from sales have decreased in each of the four years starting at $170,906 in 1995 to revenue from sales in 1998 of $116,522. It cannot be said however that his reduced gross revenue has an association with the amount spent on purchase of stock and salaries when in the same years the amounts spent on stock and salaries has decreased.
Despite this Wenjac returned a net profit in 1997 and 1998 turning around losses for the two previous years. The income tax returns for the 1999 year were not filed and there was no explanation why there were not filed.
In all of the above circumstances I cannot be satisfied that the applicant has suffered a loss of income by reason of his inability to undertake remunerative work. I can find no explanation either on the papers or apparent from his evidence or the submissions of his solicitor as to how the sum of $100,000 has been lost since 1995. Having regard to the unsatisfactory nature of the evidence with respect to the income received from Wenjac and Mr Coleman in the last 3 or 4 years, I cannot be satisfied for the reasons given earlier that the applicant can demonstrate a loss of salary or earnings by reason of war-caused injuries.
I understood the applicant's solicitor to submit that the applicant's circumstances changed during the assessment period such that for a period of time he should be entitled to intermediate rate and for another period of time he should be entitled to special rate. It was submitted there was an initial entitlement within the assessment period of intermediate rate pension (s.23) when Mr Coleman was capable of working between 8 and 20 hours per week. In recent times it was submitted his entitlement was only for special rate when his capacity for work did not exceed 8 hours per week.
The qualifying criteria under s.23 and s.24 are virtually identical save for the number of hours worked in each week.
This part of the applicant's submissions also has no merit largely because of the number of injuries, which emerged during the hearing which were not war-caused and which, upon the applicant's evidence, impact upon his capacity to work and his ability to earn income.
The decision under review insofar as it confirmed an entitlement only to general rate pension (a finding also made during the s.31 review but differing in rate) shall be affirmed.
I certify that the thirty-seven [37] preceding paragraphs are a true copy of the reasons for the decision herein of
Senior Member J. Handley
Signed:         . . . . . . . . . . . . . . . . . . . . . .
  Personal Assistant
Date of Hearing  25.02.2000
Date of Decision  04.04.2000
Solicitor for the Applicant            Mr D. De Marchi, Messrs De Marchi & Associates
Solicitor for the Respondent        Ms T. Chant, Department Advocate