Cooper and Repatriation Commission - [2002] AATA 618

DECISION AND REASONS FOR DECISION [2002] AATA 618

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q2002/110

VETERANS' APPEALS DIVISION          )
           Re      LEON JOSEPH COOPER
  Applicant
           And    REPATRIATION COMMISSION
  Respondent

DECISION

Tribunal Mr IR Way, Member

Date26 July 2002
PlaceBrisbane

Decision The Tribunal affirms the decision under review.

...........……(Sgnd)........................
Mr IR Way
Member
CATCHWORDS
VETERANS' AFFAIRS – veterans' entitlements – special rate pension – whether applicant's war-caused disabilities alone prevent the applicant from undertaking remunerative work – whether applicant was undertaking remunerative employment after he turned 65

Veterans' Entitlements Act 1986

Repatriation Commission v Smith (1987) 74 ALR 537
Repatriation Commission v Strickland (1990) 22 ALD 10
Cowper v Repatriation Commission (AAT 11340, 11 October 1996)
Ward v Repatriation Commission [1999] AATA 397
Cavell v Repatriation Commission (1988) 9 AAR 539

REASONS FOR DECISION

26 July 2002 Mr IR Way, Member

This is an application by Leon Cooper ("the applicant") for review of a decision of the Veterans' Review Board dated 21 February 2001, which, in effect, affirmed the decision of the Repatriation Commission dated 10 July 2000 that the applicant's post traumatic stress disorder ("PTSD") is war-caused and the applicant's disability pension is to be paid at 100% of the General Rate with effect from 26 May 1998.
The Tribunal had before it the documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (T1-T10), and a checklist of common stress related symptoms in respect of Vietnam veterans, which the applicant had completed (Exhibit A1). The applicant gave oral evidence.
Background Information
The applicant was born on 16 August 1932 and served for 30 years in the Australian Regular Army from 1954 to 1984. He rendered operational service in the Far East Strategic Reserve from 20 September 1959 to 1 October 1961 and in Vietnam from 25 June 1969 to 18 June 1970.
The applicant has the following accepted service-related disabilities:
·Sensori-neural hearing loss left ear;
·Coronary artery disease (CAD);
·Bilateral Tinnitus;
·PTSD.

The following disabilities have not been accepted as service-related:

Presbyopia;
Hypertension.

This matter is contested solely on the grounds that the applicant's rate of disability pension should be at the Special Rate. In particular, the critical issue in this matter is whether the applicant was undertaking his last paid work after he had turned 65.
The relevant claim by the applicant for disability pension and medical treatment was lodged with the respondent on 26 August 1998.
Legislative Framework
The Veterans' Entitlements Act 1986 ("the Act") relevantly provides as follows:
"24      Special rate of pension
(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 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; and
(c)the veteran is, by reason of incapacity from that 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 of that incapacity; and
(d)section 25 does not apply to the veteran.
(2)       For the purpose of paragraph (1)(c):
(a)a veteran who is incapacitated from war-caused injury or war-caused disease, or both, 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 if:
(i)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; or
(ii)the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason; and
(b)where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking.
(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.
(2B)For the purposes of paragraph (2A)(e), a veteran who is incapacitated from war-caused injury or war-caused disease or both, is not taken to be suffering a loss of salary or wages, or of earnings on his or her won account, because of that incapacity if:
(a)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; or
(b)the veteran is incapacitated, or prevented from engaging in remunerative work for some other reason.
(3)This section also applies to a veteran who has been blinded in both eyes as a result of war-caused injury or war-caused disease, or both.
(4)Subject to subsection (5), the rate at which pension is payable to a veteran to whom this section applies if $571.70 per fortnight.
(5)If section 115D applies to a veteran, the rate at which pension is payable to the veteran is the amount specified in subsection (4) less the pension reduction amount worked out under that section.
…
28Capacity 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 to disease, or both, has reduced his or her capacity to undertake the kinds of remunerative work referred to in paragraph (b)."
The assessment of the applicant's rate of pension is subject to the reasonable satisfaction standard of proof (subsection 120(4) of the Act), that is, on the balance of probabilities (see Repatriation Commission v Smith (1987) 74 ALR 537 at 546).
The assessment period in this matter is from 26 August 1998, the date of the applicant's claim, to the present date.
Applicant's Evidence
The applicant told the Tribunal that when he left the Army in 1984 he moved to the Gold Coast because of the weather and decided that he would need some form of paid employment to supplement his DFRDB pension. He said that before joining the Army he had been employed in the bicycle business and had been a professional racing cyclist. After consideration of his financial aims of producing a regular income and capital growth, and in view of his assessment of the need for bicycle sales and support in the Currumbin area, he set up a one-man business, Coopers' Cycles, which commenced trading on 1 December 1985. The applicant said that he deliberately chose the name Coopers' with the apostrophe after the "s" with the intention of providing for the future and leaving an ongoing business to his children.
The applicant told the Tribunal that the business was very profitable and that he left the business because of his ill health. In this respect he said that he ceased work and sold the business on 14 October 1995 having attempted to sell the business for some months prior to this. It was the applicant's evidence that at the time he was selling the business he thought his health problems were related to his coronary artery disease. However, it was suggested to him in early 1998 that PTSD was also a factor and he now believed that this was so.
It was the applicant's contention that the only reason for the sale of Coopers' Cycles was his failing health, both physically and mentally and that the causes of these health problems are directly attributable to his war service.
The Tribunal notes that the applicant stated (at T6/57) that in mid-1990 he had raised with his GP the question as to whether his problems were more psychological than physiological; and that, in his oral evidence, the applicant said his GP, Dr Coates, had advised him in the early 1990s to get out of his business because of his poor health. The Tribunal also notes that the applicant's wife, in a written statement (T6/49), said:
"There was a noticeable change in his physical and emotional health, over a period of time this had an effect on his ability to cope with the work load he had always maintained. Also, his attitude to customers and people in general.
My husband has always been very direct with people when discussing business and was respected for it, he became very impatient with customers and sometimes quite hostile if people complained, which they do in any business environment at times, silly things that would never have effected him before. This began to effect our family life as well.
Christmas was always our busiest trading period of the year, after Christmas 1990, my husband's health was really causing us great concern. We let it be known through the trade the business was available for sale at the right price. We had no serious offers. By Christmas 1992 it was evident the business had to sell, we put it in the hands of a local business broker but with little success.
The period between Christmas 1992/94 Leon's health continued to decline and disposal of the business was critical. It was decided we would continue to trade until the end of the financial year 1994/95. If in the meantime the business had not sold, we would in desperation dispose of the stock and close down.
Fortunately an offer was made at the last moment, we were in no position to refuse."
It was the applicant's evidence that his wife had given him an ultimatum to get out of the business and he described himself at this stage as being like a "caged tiger", being abusive, intolerant and violent.
In answer to questions from the Tribunal, the applicant said that he would still be working in the business except for his health problems and that he would have expected such employment to continue for some time. He told the Tribunal that when he was beset by ill health he had offered the business to two of his sons but for various reasons they did not take up his offer. It was the applicant's evidence that he was now in receipt of the service pension but that he had not applied for this until well after he had sold the business.
The applicant said that he had found the past four years or so very distressing in that the Department of Veterans' Affairs had initially rejected his claims for war-caused PTSD and that he found himself becoming increasingly agitated on referral to psychiatrists and because of what he saw as the Department's unhelpful attitude.
Submissions
Mr Grigg, the veteran's advocate, outlined the history of the applicant's claim for CAD in 1994 and his subsequent claim in 1998 in respect of hearing problems, a worsening of his CAD, nervous disorder and hypertension.
It was submitted that it was not until the applicant visited the Vietnam Veterans' Office in Nerang early in February/March 1998 that it became apparent, as a result of the applicant's various stress-related symptoms (Exhibit A1), that the applicant suffered PTSD as a result of his war service. It was contended that the applicant's PTSD was a major factor in the applicant ceasing work in 1995 at age 63 and that had the applicant been aware of this at the time a claim could have been submitted before he turned 65 years of age and, as a result of such a claim, the applicant's pension would have been assessed at the Special Rate.
It was the applicant's submission that applying the test that the applicant must have been undertaking his last paid work after turning 65 [because of his claim being submitted when he was 66 years old and the requirements of subsection 24(2A)(f)] was not in the spirit of the Act and that in this case the applicant was 63 years old at the date he was forced to stop work and that it is this age that is critical in assessing his rate of pension. In this respect, the Tribunal was referred to the statement of the Acting Minister for Veterans' Affairs when Special Rate legislation was introduced in 1985, namely:
"The Special Rate or TPI rate pension was designed for severely disabled Veterans of a relatively young age who could never go back to work and would never hope to support themselves or their families or put away money for their old age. It was never intended that the TPI rate would become payable to a veteran, who having enjoyed a full working life after war service, then retires from work possibly with whatever superannuation or other retirement benefits are available to the Australian work force – If a person has had the usual span of a working life or has retired voluntarily or has left employment for a reason other than accepted disabilities, a TP & I pension is not payable."
It was submitted that within the spirit of the Act, as evidenced by the Acting Minister's statement, there is no inherent requirement for a veteran who is over 65 at the time of lodging an application to have continued in his last work after age 65, rather it is an arbitrary requirement specified for the sole purpose of giving legislative effect to the Government's Policy Statement.
It was submitted that the veteran was severely disabled due to war-caused disabilities when he was forced to cease work, that he did not cease work voluntarily, and had he sought representation or assistance from Vietnam veterans' organisations or the RSL he would have succeeded in a claim made at the time he ceased work and before he turned 65 and that, in this case, assessment had been made under the wrong category.
Mr Grigg drew to the Tribunal's attention the Repatriation Guidelines in respect of Special Rate of pension, in particular, example 2 given in Attachment B where it is stated:
"The veteran leaves the workforce due to a condition that a number of years later is accepted as war-caused. If the veteran had applied to have the condition accepted at the time he or she left the workforce, the veteran would have satisfied the alone test in section 24(1)(c). If, now, the veteran is still under 65 and the accepted disabilities still continue to be 'the substantial cause' ….. preventing him or her from engaging in remunerative work, the veteran may satisfy section 24(2)(b)."
The Tribunal notes that the examples given in Attachment B only apply to veterans under age 65.
Mr Grigg also referred the Tribunal to Repatriation Commission v Strickland (1990) 22 ALD 10 where the Court at 17 said:
"Age 65 was not an irrelevant matter. It is a common retiring age for employees and can be taken to reflect somewhat arbitrarily the community's general understanding of the effect of age upon ability to undertake gainful employment. Thus, as the Tribunal said, 65 years is the age at which a male person qualifies for the grant of an age pension. It follows that, if nothing more were known of an applicant for a pension than that he was over the age of 65 years when the application was lodged, a tribunal would not be likely to be satisfied that the veteran was then suffering a loss of earnings by reason only of his war-caused incapacity. Of course, that is only a hypothetical case and, invariably, more is known about the matter than that, as it was in the present case. But the point is that a tribunal, especially a tribunal which deals with issues of this nature regularly, might reasonably proceed from the premise that applications for pension made after that age would fail, unless facts were disclosed which tended to the conclusion that the veteran would then still be continuing to undertake remunerative work, but for his war-caused incapacity.
Of course, age 65, is not an age which is directly applicable to a person who is running his own business or who controls the affairs of a company which conducts the business in which he is engaged."
Following the submissions, as outlined above, it was submitted that in respect of Special Rate pension the applicant's circumstances fitted within the stated intention of the Act and the applicant's pension should be so assessed.
Mr Williams, for the respondent, conceded that the applicant, at all material times, satisfies all of the paragraphs of subsection 24(2A) with the exception of paragraph 24(2A)(f) which states:
"(f)the veteran was undertaking his or her last paid work after the veteran had turned 65;…"
It was submitted that on any plain reading of this paragraph of the Act, and in the light of the evidence before the Tribunal, the applicant does not satisfy the criteria in that paragraph and as such his claim cannot succeed.

Mr Williams distinguished the applicant's reference to Repatriation Commission v Strickland (supra) in that Strickland's case predates the changes made to the Act in 1994 and which are applicable in this case. In support of the respondent's contention that subsection 24(2A)(f) is not satisfied, the Tribunal was referred to the consideration of the effect of subsection 24(2A) in Cowper v Repatriation Commission (AATA 11340, 11 October 1996); and Ward v Repatriation Commission [1999] AATA 397.
Considerations
In respect of consideration of Special Rate pension, his Honour Justice Burchett in Cavell v Repatriation Commission (1988) 9 AAR 539 stated:
"…to distract the Tribunal from its true task – to make a practical decision whether the veteran's loss of remunerative work is attributable to his service-related incapacities, and not to something else as well. It is a decision that should not be made upon nice philosophical distinctions, but with an eye to reality, and as a matter in respect of which common sense is the proper guide."
With respect, the Tribunal adopts this approach in consideration of this matter.
After consideration of all of the material before it, the Tribunal finds:
(a)that the applicant, at all material times, satisfies subsections 24(1)(a) and 24(1)(b) of the Act;
(b)that the applicant ceased remunerative work on 14 October 1995 when he was 63 years old;
(c)that the applicant lodged the claim for disability pension and medical treatment which is relevant to this matter, on 26 August 1998 when he was 66 years old.
In light of the respondent's concession that, at all material times, with the exception of paragraph 24(2A)(f), subsection 24(2A) of the Act is satisfied, and after consideration of all of the material before it, the Tribunal finds that the applicant meets the criteria in subsections 24(2A)(a), (b), (c), (d), (e) and (g).
Turning then to the crucial issue as to whether the applicant satisfies subsection 24(2A)(f) of the Act.
In introducing the relevant legislation to Parliament and explaining the changes, the Minister for Veterans' Affairs' Explanatory Memorandum stated:
"Summary of proposed changes
The proposed amendments provide that the special or intermediate rates of disability pension will not apply to veterans who are over 65 years of age unless they had been engaged in remunerative work after the age of 65 years and, when they stopped their last remunerative work, they had been engaged in that remunerative work for at least ten years. The proposed amendments will not affect payment of existing pensions at the special or intermediate rates and will only apply to claims or applications lodged on or after 1 June 1994. The new rules will apply only to veterans who make claims or applications after the age of 65 years. …
Background
The special rate of pension was originally designed for severely disabled veterans of a relatively young age who could never go back to work and could never hope to support themselves or their families or put away money for their old age. It was never intended that the special rate would become payable to a veteran who, having enjoyed a full working life after war service, then retired from work with whatever superannuation or other retirement benefits the veteran might have available to him or her. Similar principles underlie the purpose of the intermediate rate of pension for people whose accepted conditions would limit work to no more than 20 hours per week.
In a number of cases, although objectively the normal working life of the veteran had been completed, the special rate has been granted on the basis of claims that the veteran had an intention to commence a new business or occupation but had been prevented because of incapacity from war-caused disease or injury, and thereby had a loss of wages or salary, or earnings on his or her own account.
Given the original purpose of the special and intermediate rates of pension, it is inappropriate for such cases to be eligible for pension at the special rate or intermediate rate, which, once granted, generally applies for the life of the veteran unless there is an improvement in the veteran's capacity to undertake remunerative work.
Thus the proposed amendments will ensure that for a veteran to obtain the benefit of the special or intermediate rates after the age of 65, he or she must have clearly demonstrated that it was the veteran's long-term intention to have a longer than normal working life by working past the age of 65 and by working in that remunerative work for at least 10 years, and for that work to have commenced before the veteran turned 65.
Explanation of clauses
…
Special rate of pension
…
New subsection (2A) provides that, for section 24 to apply to a veteran who has made a claim or application and who has turned 65 before the claim or application was made, each and every paragraph from (2A)(c) to (2A)(h) must be met.
…
New paragraph (2A)(f) provides that the veteran must have been undertaking his or her last paid work after he or she turned 65 years of age. …"
In Ward v Repatriation Commission (supra) the Tribunal was faced with circumstances similar to those before this Tribunal, and in respect of the matter under consideration said:
"24.     The Tribunal is prepared to adopt a beneficial interpretation of the VE Act and has endeavoured to do so…
…
26.      After giving this matter very detailed and very sympathetic consideration, the     Tribunal is unable to find a beneficial interpretation of the legislation in favour of the applicant which would not fly in the face of the provisions of s 24(2A) of the VE Act.
27.     Accordingly, the Tribunal finds that as the applicant had turned 65 before he made the claim for a pension or an increase in pension, and as he does not satisfy the requirements of s 24(2A), he is not entitled to pension at the special rate pursuant to s 24 of the VE Act."
In Cowper v Repatriation Commission (supra) the Tribunal, in considering the application of the criteria under each of the provisions of subsection 24(2A) said:
"…it is clear that each of those headings must be satisfied by an applicant if a special rate of pension is to apply to that person. It is not sufficient to satisfy six out of eight or seven out of eight. The criteria are made quite stringent and quite limiting and that clearly was the intention of the legislature for better or for worse. …
…As to section 24(2A)(f) which requires the veteran to be undertaking his or her last paid work after the veteran had turned 65, again there is no evidence that in fact Mr Cowper worked past the age of 65 and therefore he is unable to meet this requirement. …
…The reality is however, that when we go through those eligibility criteria, Mr Cowper is not able to meet all of them as is required by the legislation. The unfortunate outcome, I am afraid, is that he must therefore be found not to meet the eligibility criteria for the special rate pension which he seeks.
I must therefore affirm the decision of the Veterans' Review Board, which in turn upheld the original decision made by the respondent department in March 1993, to assess the rate of pension that Mr Cowper should receive at the extreme disability adjustment rate; not at the special rate. I have indicated that it is an unfortunate outcome but I am afraid that is the way the legislature has mandated matters. It is for this Tribunal, like the Veterans' Review Board and the respondent department, to administer the law as they see it."
While the Tribunal is sympathetic to the comprehensive and competent submissions made for the applicant by Mr Grigg, the Tribunal, with respect, follows the approach taken in Cowper's case and Ward's case.
The Tribunal appreciates the submission made for the applicant that he clearly demonstrates it was his long-term intention to have a longer than normal working life by working past the age of 65 in work that he commenced before he turned 65. However, for the applicant to be assessed at the Special Rate of pension he must have been undertaking his last paid work after he turned 65 years of age. As indicated above, the applicant clearly does not meet this criteria and as such the Tribunal is satisfied that he does not satisfy the necessary criteria for assessment of pension at the Special Rate.
In arriving at this conclusion, the Tribunal accepts the respondent's submission that the matters referred to by the applicant in Strickland's case pre-date the changes to the legislation in 1994 and as such do not apply in this case.
For the above reasons the Tribunal affirms the decision under review.
I certify that the 41 preceding paragraphs are a true copy of the reasons for the decision herein of Mr IR Way, Member
Signed:         Sarah Oliver
  Associate
Date/s of Hearing  2 July 2002
Date of Decision  26 July 2002
For the Applicant  Mr F Grigg, Advocate, Veteran's Support Group
For the Respondent                 Mr B Williams, Departmental Advocate