Cummins v Petterd

Case [2021] FCA 646

FEDERAL COURT OF AUSTRALIA

Cummins v Petterd [2021] FCA 646  

File number: ACD 56 of 2020
Judgment of: FLICK J
Date of judgment: 16 June 2021
Catchwords: SUPERANNUATION – financial services – superannuation complaints – Australian Financial Complaints Authority (“AFCA”) given powers to determine superannuation complaints under s 1055 Corporations Act 2001 (Cth) – where AFCA required to decide whether satisfied that superannuation trustee’s decision “fair and reasonable in all the circumstances” – whether AFCA required to accommodate the “rule” in Browne v Dunn (1894) 6 R 67
Legislation:

Acts Interpretation Act1901 (Cth) s 25D

Administrative Appeals Tribunal Act1975 (Cth) ss 33, 43

Corporations Act2001 (Cth) ss 1051, 1052, 1055, 1057

Migration Act1958 (Cth) s 420
Cases cited:

B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187

Browne v Dunn (1894) 6 R 67

Mercer Superannuation (Australia) Ltd v Billinghurst [2017] FCAFC 201, (2017) 255 FCR 144

Millar v Federal Commissioner of Taxation [2015] FCA 1104, (2015) 67 AAR 490

Minister for Immigration and Multicultural Affairs v Eshetu [1999] HCA 21, (1999) 197 CLR 611

QSuper Board v Australian Financial Complaints Authority Ltd [2020] FCAFC 55, (2020) 276 FCR 97

R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd (1953) 88 CLR 100

Re Ruddock; Ex parte Applicant S154/2002 [2003] HCA 60, (2003) 201 ALR 437

Rushton v Commonwealth Superannuation Corporation (No 3) [2021] FCA 358

Sullivan v Civil Aviation Safety Authority [2014] FCAFC 93, (2014) 226 FCR 555

Twentyman v Secretary, Department of Social Services [2018] FCA 1892, (2018) 76 AAR 449

Wecker v Secretary, Department of Education Science and Training [2008] FCAFC 108, (2008) 168 FCR 272
Division: General Division
Registry: New South Wales
National Practice Area: Administrative and Constitutional Law and Human Rights
Number of paragraphs: 25
Date of hearing: 25 March 2021
Counsel for the Applicants: Mr T Crispin with Ms C Carnell
Solicitor for the Applicants: InPrivate Law
Counsel for the First Respondent: Mr D Stewart with Mr M Varley
Solicitor for the First Respondent: Johnson & Sendall
Counsel for the Second Respondent: Dr R P Austin with Mr B May
Solicitor for the Second Respondent: Thomson Geer
Counsel for the Third Respondent: Ms E Bennett
Solicitor for the Third Respondent: Becketts Lawyers

ORDERS

ACD 56 of 2020
BETWEEN:

BENJAMIN CUMMINS

First Applicant

MONIQUE LITTLE

Second Applicant
AND:

JANINE SHARMANE PETTERD

First Respondent

AUSTRALIANSUPER PTY LTD

Second Respondent

AUSTRALIAN FINANCIAL COMPLAINTS AUTHORITY LIMITED

Third Respondent

ORDER MADE BY:

FLICK J

DATE OF ORDER:

16 JUNE 2021

THE COURT ORDERS THAT:

1.The proceeding is dismissed.

2.The Applicants are to pay the costs of the First Respondent.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

FLICK J:

  1. The Applicants in the present proceeding are Mr Benjamin Cummins and his sister, Ms Monique Little.

  2. Mr Benjamin Cummins and his sister…

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Details
AGLC
Cummins v Petterd [2021] FCA 646
Case
[2021] FCA 646
Decision Date

CaseChat Overview and Summary

The case of Cummins v Petterd involved an appeal against a decision made by the Australian Financial Complaints Authority (AFCA) regarding a superannuation complaint. The primary issue before the court was whether AFCA was required to follow the rule established in Browne v Dunn in determining whether a superannuation trustee's decision was fair and reasonable in all circumstances. The appellants, Mr Cummins and Ms Little, argued that AFCA had failed to properly consider the evidence provided by the deceased member's family, which they claimed showed that the deceased member and Ms Petterd were not in a spousal relationship at the time of his death.

The court found that AFCA did not need to adhere to the rule in Browne v Dunn when determining whether a superannuation trustee's decision was fair and reasonable. Instead, the court held that AFCA was required to make its own independent assessment of the evidence and determine whether the trustee's decision was fair and reasonable in all circumstances. The court also found that AFCA had properly considered all the evidence before it, including the conflicting evidence provided by the parties, and had provided adequate reasons for its decision. As a result, the appeal was dismissed, and the appellants were ordered to pay the costs of the first respondent.

In summary, the court held that AFCA is not bound by the rule in Browne v Dunn when determining superannuation complaints and must make its own independent assessment of the evidence. The court found that AFCA had properly considered the evidence before it and had provided adequate reasons for its decision. The appeal was dismissed, and the appellants were ordered to pay the costs of the first respondent.

Orders

Orders of the court

1. The proceeding is dismissed.

2. The Applicants are to pay the costs of the First Respondent.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

That account was as follows:The weight of evidence indicates the claimed spouse was in a spousal relationship with the deceased member at the date of his death.I have considered the evidence as it relates to each of the following common law factors, indicative of when two people are living together on a genuine domestic basis in a relationship as a couple.Duration of the relationshipIt was open to the trustee to find that the claimed spouse and the deceased member began living together as a couple some time around 2002 and were still living together as a couple at the date of his death.Despite the evidence on behalf of the complainants that the nature of their relationship had changed in around 2013, there is evidence from third parties of their ongoing relationship as a couple.Many relationships go through periods of stress, particularly in circumstances involving alcoholism. It is possible there were periods when tensions were high and the couple presented as estranged, but this does not mean they had permanently broken up, as claimed by the deceased member’s family.Nature and extent of a common residenceThere is no dispute that the claimed spouse and the deceased member shared several common residences over the course of their relationship.Sexual relationshipIt is open to accept the claimed spouse’s evidence that she and the deceased member had a sexual relationship. No one has refuted that evidence and third parties have attested to witnessing affection between them.Degree of financial dependence or interdependenceThere is no dispute that the claimed spouse and the deceased member did not maintain joint bank accounts or finances. However, the claimed spouse says that the deceased member helped meet expenses and contributed by paying $230 per week for food, $40 per week for petrol and $40 per month for a Foxtel subscription, while she paid the rental of $220 per week. This demonstrates a degree of financial interdependence because, without the other’s contributions, each of them would have had to pay for both rental and other living expenses alone. Even the deceased member’s family acknowledges that, at a bare minimum, the claimed spouse and deceased member were cohabitating to share living expenses.Ownership use and acquisition of propertyThere is no dispute that the claimed spouse and the deceased member did not own any joint property.Mutual commitment to a shared lifeIt was open to the trustee to consider that the claimed spouse and the deceased member were mutually committed to a shared life. There is evidence from friends, work colleagues and the real estate agent supporting an ongoing relationship. While there were no social media posts or text messages, the claimed spouse explains that they did not interact in this way. In my view, it would not be fair or reasonable to infer the absence of a mutual commitment from an absence of social media or text messages.Care and support of childrenThere is no evidence the claimed spouse and the deceased member were involved in jointly caring for his children, who did not live in the same city. There is some evidence the adult son stayed with them for a short time, but the claimed spouse says the deceased member was not very close to his children and this claim is supported by third parties. The adult daughter says she did not seek out a relationship with her father once she had a child of her own, due to his alcoholism.Reputation and public aspects of the relationship The weight of evidence indicates that the claimed spouse and the deceased member were recognised as a couple, including by his sister who named her as his ‘de facto’ and involved her in the funeral arrangements. It is clear they were publicly acknowledged as a couple at the racetrack where the deceased member worked and socialised as a couple in their home, even if they did not attend family functions together.The claimed spouse was also named as the deceased member’s partner in his funeral notice.The evidence challenging the status of their relationship comes from the deceased member’s family. However, apart from LB, the deceased member’s family members (including the complainants) do not appear to have had regular contact with the claimed spouse and the deceased member as a couple and therefore may not have had the opportunity to observe them in their daily domestic life.ConclusionConsidering all the evidence as it relates to the indicative factors as a whole, I am satisfied the claimed spouse was in a spousal relationship with the deceased member at the date of his death.It is not strictly necessary to consider whether the claimed spouse was also in an interdependency relationship with the deceased member at the date of his death. I note, however, that the legislated factors for an interdependency relationship are similar to the common law factors considered above and it would also have been open to the trustee to find that an interdependency relationship existed at the date of his death.Of these reasons, Mr Cummins and Ms Little maintained that a course not open to the Authority was to simply:·conclude that it was “open to the trustee” to reach the conclusions there stated; or ·note that there was “no dispute that the claimed spouse and the deceased member did not maintain joint bank accounts” but to go on and conclude that there was “a degree of financial interdependence”; or ·note the qualification that it was “open to accept the claimed spouse’s evidence”.

Decision

Reasons for decision

Not to be ignored is the fact that after being provided with a copy of the February 2020 Recommendation, the legal representatives of Mr Cummins and Ms Little responded in some degree of detail to the further Statutory Declarations provided to the Authority to urge it to depart from its earlier Recommendation. But no submission was then made that the Authority would not be proceeding in a fair manner if it did not conduct interviews for the purpose of getting the input of those who had advanced conflicting accounts of the relationship between the deceased and Ms Petterd.CONCLUSIONS Notwithstanding the difficulties as to the manner in which the second Question as framed in the Amended Notice of Appeal is drafted, it is to be answered in the negative. It follows that the proceeding should be dismissed. It is unnecessary to resolve the First Respondent’s Notice of Contention. In the absence of any statutory provision or other reason to reach a contrary conclusion, the Applicants should be ordered to pay the costs of the First Respondent. The Third Respondent withdrew an application that its costs should be paid in the event of the proceeding being dismissed. The Second Respondent sought its costs and actively participated in the present proceeding. But an order for the payment of its costs should not be made. Although it was not the decision-maker whose decision was sought to be impugned, the Second Respondent was the initial decision-maker and could well have left the fate of its own decision and that of the Authority to be resolved on the competing submissions advanced by the Applicants and the First Respondent. It would be unjust, with respect, to expose the Applicants to the payment of two sets of costs orders. THE ORDERS OF THE COURT ARE:1.The proceeding is dismissed.2.The Applicants are to pay the costs of the First Respondent.

Ratio Decidendi

Legal Principle Established

On 19 March 2020, the solicitors representing the First Respondent, Ms Petterd, had written to the Authority urging it “to reject the recommendation” and made submissions in support of that contention and provided further Statutory Declarations. As at 26 March 2020, at the very latest, solicitors had been retained by and were acting on behalf of “the children of the late Christopher Benedict Cummins, Monique Little and Benjamin Cummins”. A letter written to the Authority on that date expressly “respond[ed] to each of the points raised by Mrs Petterd’s solicitor in their correspondence dated 19 March 2020”. The letter then proceeded to set forth about a further page of response to that letter. By that stage, it would appear, further Statutory Declarations had been provided to the Authority in support of the claims made by Ms Petterd. In response to those further declarations the letter continued on as follows (without alteration):Clients view of the additional Statutory Declarations provided by Mrs Petterd.In perusing the Statutory Declarations that have now been provided by Mrs Petterd our clients make the following observations:•When examining all the statutory declarations supporting Mrs Petterd’s objection, some of the statutory declarations suspiciously seem similar in both content and expression.•It is our clients view that the supporting statutory declarations are not relevant, as they consist largely of conclusions about the nature of the relationship between the late Mr Cummins and Mrs Petterd. There seems to be little or no facts provided that support those conclusions raised by the respective witnesses in their statutory declarations.•Our client’s instruct that they have only ever heard of Kara Diane Whitelaw due to the fact she is the daughter of Mrs Petterd. All other persons who have provided supporting Statutory declarations to support Ms Petterd claim, they have never met or were even discussed, yet alone mentioned by their late father to them.•Our clients note when examining their late fathers’ Facebook account and profile only a “Kennith Enright” is listed on their late fathers’ Facebook friends list and none of the other alleged “friends” of Mrs Petterd are on the late Mr Cummins friends on his Facebook profile.We hope that this will assist the AFCA ombudsman in their examination and determination of this matter. Missing from that submission made on 26 March 2020 is any submission of the kind now sought to be relied upon, namely that a “fair” decision could only be made if an opportunity were to be provided for each of the conflicting witnesses to comment on any contrasting account. Fifth, the manner in which the Authority proceeded in the present case does not self-evidently disclose any apparent procedural unfairness. If attention is focussed upon the reasons provided by the Authority, those reasons (inter alia):·set forth a summary of the conflicting contentions of the parties, and a brief reference to the competing evidence, expressly acknowledging that there is “conflicting evidence about the nature of the relationship between the claimed spouse and the deceased member in 2018”; and·the manner in which it “weighed” that evidence.It is the latter part of those reasons which was the focus of attention by Counsel for Mr Cummins and Ms Little.