Connell and Repatriation Commission
[2010] AATA 911
•17 November 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 911
ADMINISTRATIVE APPEALS TRIBUNAL )
) No: 2009/5356
VETERANS’ APPEALS DIVISION )
ReBruce Connell
Applicant
And Repatriation Commission
Respondent
DECISION
TribunalMr R P Handley, Deputy President
Date17 November 2010
PlaceSydney
DecisionThe Tribunal sets aside the decision under review and substitutes a decision that Mr Connell is qualified for payment of disability pension at the Intermediate Rate with effect from 13 November 2008.
.....................[sgd].....................
Mr R P Handley
Deputy President
CATCHWORDS
VETERANS’ AFFAIRS – entitlements - disability pension – intermediate rate – degree of incapacity - compensation for financial loss by reason of reduced capacity as a result of war-caused injury or disease – beneficial legislation –ceasing remunerative work of the kind previously undertaken not a requirement of the section – decision under review set aside
RELEVANT ACT
Veterans’ Entitlement Act 1986 (Cth): ss 23, 24, 120
CITATIONS
Repatriation Commission v Smith (1987) 15 FCR 327; (1987) 12 ALD 798
Repatriation Commission v Haskard (2002) 126 FCR 1; (2002) 71 ALD 29; [2002] FCA 1493
Repatriation Commission v Wright (2005) 144 FCR 302; (2005) 213 ALR 536; [2005] FCA 7
Flentjar v Repatriation Commission (1997) 48 ALD 1
OTHER AUTHORITIES
Department of Veterans’ Affairs Guide to the Assessment of Rates of Veterans’ Pensions (5th edn, 1998)
REASONS FOR DECISION
| 17 November 2010 | Mr R P Handley, Deputy President |
Mr Connell has applied for the review of a decision of the Veterans’ Review Board (VRB) affirming a decision of the Repatriation Commission (the Commission) to pay him a disability pension at 60% of the General Rate. Mr Connell contends that the degree of his incapacity should be assessed as at least 70% and that he should be paid at the Intermediate Rate of pension.
Background
When, on 13 February 2009, Mr Connell applied for a disability pension, he was aged 61. He had served in the infantry in Vietnam in 1968/1969. On 25 May 2009, the Commission accepted the following disabilities as being war-caused: bilateral pinguecula, sub-acute conjunctivitis, post traumatic stress disorder (PTSD), sensorineural hearing loss, tinnitus, and alcohol dependence. The Commission rejected Mr Connell’s claim in respect of a skin condition on the ground that it caused no disability. The Commission decided that disability pension should be paid to Mr Connell at 60% of the General Rate of pension.
Mr Connell sought a review of his assessment by the VRB which, on 10 September 2009, affirmed the decision. On 9 November 2009, Mr Connell sought a further review by the Tribunal. The principal issue for the Tribunal is whether Mr Connell is qualified for the Intermediate Rate of pension. The Commission has conceded that Mr Connell’s pension should be assessed at 70% of the General Rate.
The Relevant Legislation
The qualifications for payment of disability pension at the Intermediate Rate are set out in s 23 of the Veterans’ Entitlement Act 1986 (the VEA). This section provides relevantly:
(1)This section applies to a veteran if:
(aa)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
(aab)the veteran had not yet turned 65 when the claim or application was made; and
(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)the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and
(b)the veteran's incapacity from war‑caused injury or war‑caused disease, or both, is, of itself alone, of such a nature as to render the veteran incapable of undertaking remunerative work otherwise than on a part‑time basis or intermittently; and
(c)the veteran is, by reason of incapacity from 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 from that incapacity; and
(d)section 24 or 25 does not apply to the veteran.
(2)Paragraph (1)(b) shall not be taken to be fulfilled in respect of a veteran who is undertaking, or is capable of undertaking, work of a particular kind:
(a)if the veteran undertakes, or is capable of undertaking, that work for 50 per centum or more of the time (excluding overtime) ordinarily worked by persons engaged in work of that kind on a full‑time basis; or
(b)in a case where paragraph (a) is inapplicable to the work which the veteran is undertaking or capable of undertaking--if the veteran is undertaking, or is capable of undertaking, that work for 20 or more hours per week.
(3) For the purpose of paragraph (1)(c):
(a)a veteran who is incapacitated from war‑caused injury or war‑caused disease, or both, to the extent set out in paragraph (1)(b) 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:
(i)if 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;
(ii)if the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason; or
(iii)if the veteran has been engaged in remunerative work on a part‑time basis or intermittently for reasons other than his or her incapacity from that war‑caused injury or war‑caused disease, or both; and
(b) …
(3A) 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) (as affected by subsection (2)) 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) …
(f) …
(g) …
(h) …
Pursuant to s 120(4) of the VEA, the standard of proof is that of ‘reasonable satisfaction’ which the Federal Court has interpreted as meaning the civil standard, that is the balance of probabilities: Repatriation Commission v Smith (1987) 15 FCR 327, at 334 (per Beaumont J, with whom Northrop and Spender JJ agreed).
Evidence
Mr Connell provided statements dated 8 April 2010 and 29 April 2010 and also gave oral evidence at the hearing. He said that he and his long term partner, Annette Perry, took a holiday in Vietnam in 2004 and, after visiting a war museum there, he began experiencing recurring flashbacks to his time there during the war.
Mr Connell has been diagnosed as suffering from PTSD (Dr Robert Delaforce, psychiatrist, report dated 11 April 2009; Dr Brian Parsonage, psychiatrist, report dated 2 July 2010; and Dr Anthony Dinnen, psychiatrist, report dated 7 April 2010). He states his condition has become worse since the Vietnam holiday and that he has greater difficulty concentrating now. Mr Connell works on his own as a self-employed painter. He works to a quotation rather than claiming for hours worked.
Mr Connell said that in an average week he turns up for work on most days, commencing between 7.30 and 8.00 am. On a good day, he might be able to work for up to six hours, but on some days he only works for an hour or two. In an average fortnight, he might be unable to work on one day. The quality of his work has also deteriorated because of the difficulty he is experiencing in concentrating, and there are often problems with his work that he has to go back and fix up afterwards.
In his claim for disability pension, lodged on 13 February 2009, Mr Connell said he worked up to 20 hours per week. However, in the Lifestyle Questionnaire, he stated that he worked 20 to 30 hours a week. Mr Connell told the Tribunal that the discrepancy was probably because he completed the Lifestyle Questionnaire in the presence of Ms Perry and he “wanted to cover my tracks” by not revealing to her the extent of the hours he was not working. In his statement dated 29 April 2010, Mr Connell said:
I always plan to work 5 days a week, but there are times when I just have to walk off the job and I probably only work 6 hours a day at best and no more than three times per week. On the other days I could work for an hour or so and then go down to the beach or park and drink before going home, then Annette doesn’t know I’m not at work.
At the hearing, I asked Mr Connell how many hours he had worked in a recent full week. Having been on holiday for four days in the week before the hearing, he referred to the week before. He said Monday is usually a good day and he might be able to work for up to six hours. On Tuesday, he only worked for 30 minutes. On Wednesday, he worked for 2½ to 3 to three hours. On Thursday, he worked for about 4 hours and on Friday for about 5½ or 6 hours. Assuming 3 hours for the Wednesday, and 6 for the Friday, this gives a total of about 19½ hours. Mr Connell said that on the previous Friday and Monday before the hearing, he had worked 4 hours and 1½ hours respectively.
Mr Connell was also referred to a ‘Work Schedule’ prepared for his solicitor by Ms Perry and dated 10 September 2010. Ms Perry describes jobs that commonly took Mr Connell twice as long or more than if he had worked full-time. For example, a two-week job that took five weeks, a two-and-a-half-day job that took a week, a seven-day job that took 15 days and a 10-day job that took 25 days (she estimated 3 to 4 hours worked a day over these 25 days). Ms Perry said that in June/July 2010, Mr Connell had nine requests for quotes but only did five quotes and got four jobs.
Mr Connell told me that for a four-day job, he usually quotes on the basis of five (8 hour) days work. He sometimes loses jobs because he does not turn up to give a quote for the job. He said 19 hours would be a good week and that sometimes he does not work at all.
Submissions
Ms Wood, for Mr Connell, submitted that the evidence indicates that Mr Connell works less than 20 hours a week. From the Work Schedule prepared by Ms Perry, Ms Wood noted that Mr Connell works intermittently and calculated that Mr Connell worked on average about 15 hours a week over the period June to August 2010.
Ms Wood noted that the Commission has conceded that the degree of Mr Connell’s disability should be assessed at 70%. She, nevertheless, referred to the assessments made by Dr Delaforce and Dr Dinnen and submitted that given Mr Connell’s evidence that his condition continues to deteriorate, Dr Dinnen’s impairment assessment should be accepted. Ms Wood said Mr Connell’s tax records establish the loss of earnings suffered as a result of his disability: from a taxable income of $32,726 in 2002/2003 and $33,247 in 2003/2004 to $17,776 in 2007/2008 and $15,625 in 2008/2009.
Ms Wood referred to the decisions in Repatriation Commission v Haskard (2002) 126 FCR 1 (Haskard) and Repatriation Commission v Wright (2005) FCR 302 (Wright), relied on by the Respondent. She submitted that both cases can be distinguished on their facts. Both concerned claims for Special Rate: in Haskard, the applicant was over 65; in Wright, the applicant’s failure to undertake remunerative work was not attributable to the war‑caused incapacity alone. Ms Wood said Justice Hill’s comments indicate that he sought to distinguish the provisions that apply in respect of Special Rate from those that apply in respect of Intermediate Rate.
Mr Bunn, for the Commission, said while the Commission concedes that Mr Connell should be paid a disability pension at 70% of the General Rate, he is not qualified for the Intermediate Rate if, relevantly, he can work for 20 or more hours per week. Mr Bunn said the Commission contends the evidence indicates that there are times when Mr Connell can work for 20 or more hours per week. According to Mr Connell’s statement of 29 April 2010, in a good week he can work six hours a day on “no more than three times a week. On the other days I can work for an hour or so …”.
Mr Bunn also contended that pursuant to the decision in Haskard, a decision followed in Wright, an applicant who is still engaged in remunerative work that he or she was undertaking previously is not eligible for Intermediate or Special Rate. The Commission also referred to the decision of the Full Federal Court in Flentjar v Repatriation Commission (1997) 48 ALD 1 (Flentjar), where the Court found that the Tribunal had failed to address the issue of what ‘remunerative work’ the veteran was undertaking (s 24(1)(c)) and if so, whether he had been prevented from continuing to undertake such work, thereby suffering a loss of salary, wages or earnings as a result of his incapacity.
Discussion
In Mr Connell’s case, the following requirements must be satisfied before disability pension is paid at the Intermediate Rate:
s 23(1)(a) - the degree of war‑caused incapacity must be assessed at 70%;
s 23(1)(b) - the war‑caused incapacity must prevent him from working more than on a part-time basis or intermittently (s 23(1)(b)), meaning that the incapacity must prevent him from working more than 50% of the time ordinarily worked by a person engaged in work of that kind on a full-time basis or, if this is inapplicable, from working more than 20 hours per week; and
s 23(1)(c) - the war‑caused incapacity that has prevented him from working must have led to a loss of salary, wages or earnings.
While the Commission concedes that Mr Connell’s incapacity should be assessed at 70% in accordance with the Guide to the Assessment of Rates of Veterans’ Pensions, I am also reasonably satisfied from the medical evidence – noting the report of Dr Delaforce, dated 11 April 2009, and that of Dr Dinnen, dated 7 April 2010 - as to an impairment rating, and having reviewed the applicable lifestyle rating of 3, that this is the appropriate assessment.
In relation to the requirement in s 23(1)(b), and, in particular, whether pursuant to s 23(2)(b) Mr Connell is capable of working for 20 or more hours a week, I note that the evidence is less than clear. The picture has been complicated by Mr Connell’s not wishing to reveal to his partner, Ms Perry, the full extent of the time he does not work: those days when he goes to work but feels unable to continue working and goes to the beach or the park instead. Nevertheless, Mr Connell’s evidence indicates that in a good week, he is able to work for marginally less than 20 hours. In a less than good week, the evidence suggests that Mr Connell works fewer hours. I note Ms Wood’s calculation based on Ms Perry’s Work Schedule for the period June to August 2010 indicates an average of about 15 hours per week. On the basis of this evidence, I am reasonably satisfied that Mr Connell meets the requirement in s 23(1)(b).
Turning to requirement in s 23(1)(c), I am reasonably satisfied on the evidence of Mr Connell’s tax returns that his war‑caused incapacity has led to a loss of earnings. However, the Commission submits that Mr Connell cannot satisfy s 23(1)(c) because he continues to undertake the same remunerative work that he was undertaking before he suffered a loss of earnings by reason of his incapacity.
In Haskard, Hill J compared the requirements for a person to qualify for the Intermediate Rate and those required for the Special Rate of disability pension, noting, at [31], that “the tests are more stringent” in the case of a veteran over the age of 65. In that case, it was the applicant’s entitlement to Special Rate which was in issue and his Honour found that the provisions of s 24(2A) did not apply to the applicant because he was still undertaking the same remunerative work that he had undertaken previously although for fewer hours. Justice Hill said at [28]:
… It seems to me that in each case where language equivalent to s 24(2A)(d) is used, what is required is that the veteran, by reason only of the war-caused injury or disease or both, can no longer work in the particular job or occupation that the veteran has had. In none of the occasions where these words are used is there any implication one way or the other that the veteran would be incapacitated from working in any other job or occupation. There is nothing in these words which goes to the question of capacity to work. All that is in question is whether the veteran has been prevented from continuing to undertake the particular remunerative work that he had undertaken. In s 23 capacity is dealt with in s 23(b) [sic 23(1)(b)], as supplemented by s 23(2). In the case of the Intermediate Rate, the veteran's capacity to work must be such as not to permit the veteran to work other than intermittently or on a part-time basis.
He commented, at [32],
During the course of argument, I was attracted to the possibility that a veteran who had worked full time but whose ability to work full time was impaired because of incapacity from war-caused injury so that he or she was only able to work part time, might be said to have been prevented by reason of incapacity from continuing to undertake his initial full time remunerative work. That would mean classifying the initial remunerative work as full time work and not part time work. I am still inclined to think that that construction might be correct. However, it does not assist the applicant in the present case. …
Section 23(1)(aab) in respect of Intermediate Rate and s 24(1)(aab) in respect of Special Rate provide that the sections apply to a veteran who has not yet turned 65 when the claim or application was made. Section 23(3A) in respect of Intermediate Rate and s 24(2A) in respect of Special Rate impose additional requirements on a “veteran who has turned 65 before the claim or application was made” (subparagraph (b)). These more stringent tests do not, on the plain language of the sections, apply to a younger veteran. Thus, in my view, the requirement stated in s 23(3A)(d) and s 24(2A)(d) that the veteran, because of the war-caused incapacity alone, is prevented from continuing to undertake the last paid remunerative work before the veteran made the claim or application does not apply.
In my view, the context of s 23(1) as a whole should be considered. Paragraph (a) addresses the required degree of incapacity for a veteran to be qualified for Intermediate Rate, paragraph (b) addresses the effect of the incapacity on the veteran’s ability to work, the test being that the veteran is incapable of working otherwise than on a part-time or intermittent basis (as further defined in s 23(2)), and paragraph (c) addresses the effect of this reduced ability to work on the veteran’s earnings. Having regard to the context in which the words ‘prevented from continuing to undertake remunerative work’ appear in s 23(1)(c), and to the presumed intention of what is beneficial legislation, being to compensate the under‑65 veteran for loss of earnings as a result of his or her only being to work part-time or intermittently because of the war-caused incapacity, I am persuaded that Justice Hill was correct in his obiter comment at [32], quoted above, and that this is how s 23(1)(c) should be interpreted.
Mr Bunn also referred me to the decision in Wright, which like Haskard concerned an application for Special Rate, but where the applicant was under 65. In that case, the applicant was prevented from continuing remunerative work because of both war-caused diseases and injuries and non-accepted conditions. Thus, he could not satisfy the ‘alone’ test in s 24(1)(c) – the requirement that the war-caused injury or disease, or both, alone must have prevented him from working. Tamberlin J went on to cite Hill J’s judgment in Haskard, at [31], noting that Mr Wright had also not been prevented from continuing his remunerative artistic work. In my view, these remarks concerning the application of Haskard were essentially obiter, and I note that his Honour did not refer to the age difference between Mr Wright and the applicant in Haskard nor to the additional requirements that apply in respect of a veteran over the age of 65 which are set out in s 24(2A).
In Flentjar, the facts were also materially different to those in the present case. The applicant, who claimed Special Rate, was aged 74 at the time he applied for a disability pension. The Court found that the Tribunal did not give proper consideration to the likelihood that the applicant would have continued to work in the remunerative work that he had been undertaking within the meaning of s 24(1)(c). The evidence was complicated by the fact that the taxi driver licensing authority’s policy at the relevant time was not to issue licenses to persons who had attained the age of 70. The Court does not appear to have addressed the more stringent test applicable to applicants over the age of 65 by reason of s 24(2A).
To conclude, in my view, in the case of a veteran under the age of 65 applying for payment of disability pension at the Intermediate Rate, the application of requirement in s 23(1)(c) does not require that the veteran must be prevented by his war-caused injury or disease from continuing to undertake any remunerative work of the kind previously undertaken. Rather, the requirement in paragraph (c) focuses on the loss of salary, wages or earnings suffered as a result of the incapacity. It is that financial loss suffered by the veteran by reason of his or her reduced capacity to work as a result of the war-caused injury or disease for which the veteran is compensated.
Decision
The Tribunal sets aside the decision under review and substitutes a decision that Mr Connell is qualified for payment of disability pension at the Intermediate Rate with effect from 13 November 2008, being three months before the date of claim as permitted by s 20(1) of the VEA.
I certify that the 29 preceding paragraphs are a true copy of the reasons for the decision herein of Mr R P Handley, Deputy President.
Signed: ..............[sgd]...........................................................
A Veness, Associate
Date of Hearing: 10 November 2010
Date of Decision: 17 November 2010Applicant representative: Ms J Buss, Legal Aid Commission of NSW Veterans’ Advocacy Services
Applicant counsel: Ms E Wood
Respondent representative: Mr N Bunn, Department of Veterans’ Affairs Advocacy Section
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