Filsell and Comcare
[2010] AATA 891
•12 November 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 891
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2007/4777
GENERAL ADMINISTRATIVE DIVISION ) Re JEFFREY WARREN FILSELL Applicant
And
COMCARE
Respondent
DECISION
Tribunal Senior Member R W Dunne Date12 November 2010
PlaceAdelaide
Decision The Tribunal affirms the consent decision under review.
..............................................
R W DUNNE
(Senior Member)
CATCHWORDS
COMPENSATION – Commonwealth employee – claim for psychological injury arising from employment – claim rejected – application for review of decision – application resolved by consent order in which Tribunal affirmed decision – further claim for compensation for depression and anxiety rejected and affirmed – affirmed decision revoked by respondent in a reconsideration on own motion – application for review of revocation decision – whether consent decision was induced by duress – consent decision under review affirmed.
Administrative Appeals Tribunal Act 1975 (Cth) ss 37, 42B, 42C, 43
Re Filsell and Comcare [2009] AATA 90
Re Kowalski and Repatriation Commission [2008] AATA 903
Bushell v Repatriation Commission (1992) 175 CLR 408
McDonald v Director-General of Social Security (1984) 1 FCR 354
Re Eckersley and Minister for Capital Territory (1979) 2 ALD 303
Harvey v Phillips and Anor (1956) 95 CLR 235
Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40
Cockerill and Ors v Westpac Banking Corporation [1996] FCA 1143
Universe Tank Ships Inc of Monrovia v International Workers Federation and Ors [1983] 1 AC 366REASONS FOR DECISION
12 November 2010 Senior Member R W Dunne introduction
1. The applicant involved in this case is Mr Jeffrey Filsell, who was an employee of the former Department of Finance and Administration. In October 1997, following an earlier claim, Mr Filsell made a claim for a psychological injury arising from his employment. When the respondent (“Comcare”) rejected the claim, Mr Filsell applied to this Tribunal for review of the decision. That application was resolved by a consent decision dated 6 July 1999, in which a Senior Member of this Tribunal affirmed the decision, and noted that Comcare had agreed to pay certain costs and disbursements of the applicant.
2. In June 2006, Mr Filsell made a further claim for compensation for depression and anxiety. This further claim was rejected by Comcare and affirmed on reconsideration in October 2006. A review officer subsequently revoked that affirming decision in September 2007 in a reconsideration on own motion. Mr Filsell applied to this Tribunal for review of the decision of September 2007. Comcare subsequently applied, pursuant to s 42B of the Administrative Appeals Tribunal Act 1975 (Cth) (“Act”), to dismiss Mr Filsell’s application on the grounds that it was frivolous or vexatious. At the hearing of Comcare’s application (which is reported as Re Filsell and Comcare [2009] AATA 90), Deputy President D G Jarvis held that the proceedings should not be dismissed under s 42B of the Act. During the course of the hearing, Mr Filsell made reference to having acted under duress when he signed the agreement that gave rise to the consent decision of this Tribunal dated 6 July 1999. The learned Deputy President determined that, if necessary, the circumstances in which the consent agreement was entered into could be explored at the review hearing of the decision of September 2007. It was subsequently agreed by the parties that the duress referred to should be dealt with separately and prior to the hearing of the application for review of the decision of September 2007.
3. At the hearing before me of the duress issue, Mr Filsell represented himself. He was assisted by his advisor and advocate, Mr K J Kaeding, President of the SA Residents and Ratepayers Federation of South Australia. Both Mr Filsell and Mr Kaeding gave evidence. Mr M Roder, of counsel, appeared for the respondent. I received into evidence the further supplementary T documents (Volumes 1 and 2) lodged pursuant to s 37 of the Act (Exhibit R1), together with the following exhibits:
·documents prepared by the applicant titled “Further and Better Particulars” (Exhibit A1);
·letter to applicant from Mr Mark McCabe dated 9 February 2001 (Exhibit A2);
·letter to applicant from Mr Mark McCabe dated 16 April 2002 (Exhibit A3); and
·original T documents prepared by the respondent in relation to the applicant’s June 2006 claim (Exhibit R2).
Issue before the Tribunal
4. The issue before the Tribunal is whether the consent decision of this Tribunal dated 6 July 1999 should be set aside on the basis that the decision, under s 42C of the Act, was induced by duress.
background
5. The following factual background appears in the respondent’s Statement of Facts and Contentions and is largely not in dispute. Following his application to this Tribunal for review of the decision of Comcare in respect of his further claim for a psychological injury in October 1997, Mr Filsell wrote to Comcare on 22 August 1998 (Exhibit R2, T117) stating (inter alia) that he:
“…would like to initiate a discussion with yourself (with Mr Gilchrist, if you/ Comcare wish) with a view to finalising the matters once and for all. This, of course, will then facilitate my withdrawing the Ministerial Inquiries and allow all of us to get on with other more productive aspects of our work and lives.”
6. On 22 September 1998 or thereabouts, Mr Filsell met with Comcare’s solicitor at the time, Mr Kevin Gilchrist (Exhibit R1, ST699, page 1825). Mr Filsell stated that he was keen to settle the matter without involving the Tribunal, his psychiatrist and his solicitor, Mr Steven Clark. On 2 October 1998, Mr Filsell wrote to Mr Gilchrist regarding a further meeting on 13 October 1998, stating (inter alia):
“You are aware that I would prefer to save both myself and taxpayers the burden of additional medical and legal input at this juncture. Steven Clark, my Barrister, has also intimated that he shares the view that all parties now are intimately familiar with sufficient details of this case for some kind of finalisation to be made without further such intervention.”
7. On 13 October 1998, Mr Filsell met with Mr Gilchrist and Mr C Moylan from Comcare. On that day, Mr Gilchrist wrote to Mr Filsell (Exhibit R1, ST705) in the following terms:
“We confirm our without prejudice intimation that Comcare would favourably consider payment of your out-of-pocket expenses in relation to the Administrative Appeals Tribunal proceedings (such as legal advice and related medico-legal disbursements) subject to Comcare’s determination being confirmed by the Administrative Appeals Tribunal.”
8. On 14 October 1998, Mr Filsell wrote to Mr Gilchrist seeking further time to respond to the settlement offer, after having taken legal advice (Exhibit R1, ST706). On 21 October 1998, Mr Filsell’s solicitor (Mr Clark) contacted Mr Gilchrist and requested written confirmation of the proposed terms of any settlement. Mr Gilchrist provided confirmation on that day (Exhibit R1, ST 707). On 23 November 1998, Mr Clark wrote to Mr Gilchrist confirming that he had instructions to consent to the order proposed by Mr Gilchrist in his letter of 21 October 1998, on payment of certain expenses (Exhibit R1, ST709). On 3 December 1998, Mr Gilchrist advised Mr Clark that some of the expenses were not within the scope of the negotiations (Exhibit R1, ST710).
9. On 25 February 1999, Mr Clark contacted Comcare’s solicitors stating that Mr Filsell still wished to settled his claim and that he wanted to arrange an independent psychiatric assessment. On 8 April 1999, Mr Clark made a further offer to settle his claim (Exhibit R1, ST730). Following further discussions in April 1999 and May 1999, on 11 June 1999 Mr Gilchrist wrote to Mr Clark making a final offer of settlement in the following terms (Exhibit R1, ST742) :
“Our client’s final offer is $5,000 plus payment of Dr Black’s account.
The payment is to be characterised as being on account of representation costs and disbursements.
The payment is in full satisfaction and discharge of all injuries and claims arising under the Safety, Rehabilitation and Compensation Act 1988 and including an affirmation by the AAT of the current determination before it.”
10. On 16 June 1999, Mr Gilchrist wrote to Mr Clark confirming that Mr Filsell had accepted Comcare’s settlement proposal as formulated in the letter dated 11 June 1999 (Exhibit R1, ST744). Mr Gilchrist indicated that Comcare’s solicitors would prepare Minutes of Order and forward them to Mr Clark. Mr Gilchrist asked that Mr Clark confirm his client’s acceptance in writing.
11. On 18 June 1999, Comcare’s solicitors wrote to Mr Clark enclosing proposed Minutes of Order for signature and lodgement with the Tribunal (Exhibit R1, ST745). On 28 June 1999, Mr Clark confirmed his client’s acceptance of the settlement proposal as formulated in the letter dated 11 June 1999 (Exhibit R1, ST\ 747). Mr Clark also enclosed a copy of the Minutes of Order that had been signed by Mr Gilchrist and Mr Clark and confirmed that Mr Gilchrist would lodge the Minutes with the Administrative Appeals Tribunal. On 2 July 1999, the signed Minutes of Order were lodged with the Tribunal (Exhibit R2, T126).
12. On 6 July 1999, this Tribunal made the consent decision pursuant to s 43 of the Act (Exhibit R2, T127).
13. On 21 July 1999, Mr Clark wrote to Mr Gilchrist enclosing an authority signed by Mr Filsell authorising and directing Comcare to forward the settlement monies to his solicitor’s trust account (Exhibit R1, ST753).
14. On 3 September 1999, Mr Clark wrote to Mr Gilchrist confirming receipt of the settlement monies and requesting payment of a disbursement account (Exhibit R1, ST 763).
evidence
15. It was Mr Filsell’s evidence initially that the making of the consent agreement and the subsequent decision was a transparent attack on his personal credibility. He referred generally to a number of internal memoranda from officers of the respondent which he said gave rise to duress relevant to his decision to enter into the agreement. He also referred to the letter from Europa Clinic (Exhibit R1, ST610), which he said outlined his state of mind in March 1998. The fact that he had suffered enormous strain since his dismissal from employment was a continuing factor that affected the duress he had experienced.
16. Mr Filsell referred to certain matters dealt with in his Further and Better Particulars (Exhibit A1), which he said were instances of the duress he had suffered in the period prior to the making of the consent agreement. Those instances were:
“ …
4. The failure by Comcare to accept that I am a man of integrity.
5.The stress that I felt as a result of the terminal illnesses of two family members, the collateral and overwhelming stress from my claim(s) against Comcare (which I perceived was acting unreasonably and unfairly), and the request by my family to settle my claim.
…
8.The actions of a doctor at the Europa Medical Centre in 1997 or 1998 in relation to an issue as to Comcare involvement in the payment of a an account for approximately $240, and my outrage at Comcare for sending the account in the first place.”
17. When asked by the Tribunal about the agreement and whether he was saying that there had been no consent on his part, Mr Filsell said:
“Officially, there’s nothing wrong with it but it came as a result of intensive intimidation and application of duress over a very long period of time.” [Transcript, page 99]
When asked about the period of time involving the intimidation and duress, Mr Filsell said:
“Well, I mean, clearly, it dates back to 1994 when Dr Richards first made his recommendation about returning to the place of employment.” [Transcript, page 99]
When asked why the issue of duress had not been raised in the period leading up to the consent decision, Mr Filsell said:
“My state at the time was such that it was clear that Comcare were going to stubbornly deny any responsibility or liability for this thing. They had the resources available to them to bully their way out of it. I had a family situation that I had to attend to. It was simply something of a defeatist attitude, at the end of the day, which is rather unusual for me, because I generally never give up.
It was a result of continued bullying from the respondent to sign the documents and get the matter done in the way that suited and was most expedient to them.” [Transcript, page 99]
18. In cross-examination about internal documents of the respondent, obtained as a result of a freedom of information request, which he said caused him duress at the time, Mr Filsell acknowledged that the documents had been received after the offer to settle had been made to the respondent by his solicitor in November 1998. He denied that he had decided not to proceed with his application for review of his claim for a psychological injury, rather than as a result of any pressure in 1998 from the respondent or its solicitors to settle the case. He admitted that he had to decide whether to accept the respondent’s settlement offer, which he did not regard as fair, or whether to proceed with the case which he had already decided he did not want to pursue. He said he had made the decision to accept the respondent’s settlement offer “under extreme pressure and reluctance”.
19. In giving his evidence, which had been requested by Mr Filsell over Mr Roder’s objection, Mr Kaeding said that he had known the applicant for approximately two years. He said he believed the applicant’s state of mind in the period prior to the making of the consent decision would have involved stress and anxiety. From the material he had read, the applicant had been bullied into the consent agreement. He had a lawyer acting for him at the time, but the applicant did not seem to receive very good advice. Also, the respondent’s apparent reluctance to acknowledge that the applicant was a man of integrity may have contributed to his duress over time.
consideration
Should the consent decision of this Tribunal dated 6 July 1999 be set aside on the basis that the decision was induced by duress?
20. The allegation by the applicant in this case is that the agreement that he made with the respondent which gave rise to the consent decision made by the Senior Member of this Tribunal on 6 July 1999 was induced by duress and should be set aside. The consent decision, which purports to have been made in accordance with s 43 of the Act, affirmed the decision of the respondent dated 16 June 1998 to deny liability for a psychological injury. In Re Filsell (supra), Deputy President Jarvis noted that the consent decision should have proceeded under s 42C, but found that it was not invalidated because it had referred to the wrong section of the Act: see the Deputy President’s discussion of the doctrine of falsa demonstration non nocet in Re Kowalski and Repatriation Commission [2008] AATA 903 at [133].
21. The applicant must show that he was induced to make the agreement and to settle as a result of pressure from the respondent, and that the pressure was, as the law regards, illegitimate. The respondent must, of course, comply with its obligations under s 37 of the Act, which include lodging and serving the documents required by that section. Those documents should include appropriate evidence and documents submitted to the respondent, and will include relevant documents under the control of the former Department of Finance and Administration. However, except to this extent, it remained necessary for Mr Filsell to adduce evidence or documents in support of his allegation. Proceedings in this Tribunal are administrative proceedings, and where (as in the present matter) the relevant legislation does not impose, expressly or by implication, an onus of proof, neither party bears such an onus: Bushell v Repatriation Commission (1992) 175 CLR 408 at 425. Nevertheless, it remains necessary for a party asserting facts to adduce evidence which would support a finding by the Tribunal that those facts exist: McDonald v Director-General of Social Security (1984) 1 FCR 354 at 358. This proposition was clearly explained by SM Todd in Re Eckersley and Minister for Capital Territory (1979) 2 ALD 303 at [18], as follows:
“I think that this is an instance in which, while no general responsibility of proof rests upon an applicant in an application to the Tribunal for review ... yet, when either party to such an application raises a specific fact for consideration, a situation can arise in which the responsibility of proving the existence of that fact must be accepted as falling upon the party who asserts its existence, in particular where that fact is, or has been, peculiarly within his own knowledge.”
22. The evidence I was seeking from the applicant was as to his state of mind at or prior to the time he made the agreement with the respondent that gave rise to the consent decision. However, for the most part, his evidence related to matters pertaining to his claims for compensation. Notwithstanding numerous requests made by me during the course of the hearing, he seemed unable or unwilling to provide evidence, whether orally or in documents, of his relevant state of mind.
23. Mr Roder submitted that, when all the evidence concerning the issue of duress at the time of the agreement and consent decision was looked at, the applicant’s allegation falls at the first hurdle. Whether he felt intimidation, duress or however he might characterise it, it is clear that the applicant was certainly not happy with the outcome. It was Mr Roder’s contention (which I accept) that the evidence does not show that the applicant was being pressured by the respondent to settle the case. In fact, the evidence is quite to the contrary. The applicant had decided that, because of his own circumstances, running the case was not a viable option. He wanted to settle the case and he initiated the settlement discussions when he wrote to the respondent on 22 August 1998. From the respondent’s perspective, there was no suggestion that the applicant was being pressured, in that sense, to settle. Moreover, there is nothing in the applicant’s evidence or in any of the documents that would suggest that there was any illegitimate pressure brought to bear on the decision to settle. The applicant made the decision of his own volition and he initiated the settlement discussions.
24. In Harvey v Phillips and Anor (1956) 95 CLR 235, which was a medical negligence case, the plaintiff was particularly unwilling to settle. There were allegations of pressure to settle which were far more significant than those in the present case. Her senior counsel thought that she should settle and went to some quite extraordinary lengths to pressure her into settling, including purporting to return the brief in the middle of the case and retire to his chambers. In addition to the senior counsel, the plaintiff’s solicitor and counsel for the defendants sought to convince the plaintiff to settle and ultimately she did so. The High Court’s conclusion was relevantly as follows:
“7. From the foregoing facts it seems clear enough that in spite of her determination not to settle the action she was temporarily overborne by the extreme pressure exerted upon her by her counsel supported by her solicitor and perhaps others and was induced, when she understood that her counsel had refused to conduct her case and when Mr. Darby spoke gently to her, to express what proved a short-lived consent to accept 4,000 pounds by way of compromise. There can be little doubt that the consent which she so expressed was to the knowledge of those present in opposition to her fixed desire and was given with a reluctance only too evident. But so far as the counsel and solicitors of the defendants knew, the plaintiff's counsel had his client's considered and definitive authority to accept the settlement. …
9. … But the difficulty which confronts the plaintiff is that her counsel when he signed the terms of settlement acted in accordance with the authority which she gave in the manner described by Mr. Beard. … But in the circumstances of this case it does not appear to us that the court possesses a discretion to set aside the compromise or to intercept the formal entry of judgment. It is not a case of misapprehension or mistake made by counsel in consenting to an order or settlement: cf. Hickman v. Berens (1895) 2 Ch 638. … The question whether the compromise is to be set aside depends upon the existence of a ground which would suffice to render a simple contract void or voidable or to entitle the party to equitable relief against it, grounds for example such as illegality, misrepresentation, non-disclosure of a material fact where disclosure is required, duress, mistake, undue influence, abuse of confidence or the like. …
10. … Once it appears that the plaintiff did in fact give an assent which had not been withdrawn up to the moment when the terms of settlement were signed, it can be nothing to the point to say afterwards to the defendants that it was the result of her real desires or her judgment being overborne by her advisers, whatever may have been the degree of moral pressure that she felt.
…” [emphasis added]
25. The circumstances in Harvey were extreme, and there is no contention that there was the same overbearing pressure, or any pressure at all, on Mr Filsell to settle. Even if the defendant in Harvey had suspected that there was some overbearing pressure being placed on the plaintiff, it would not have made any difference. The plaintiff’s counsel had his client’s authority to accept the settlement and had acted accordingly. The same occurred in Mr Filsell’s case.
26. In Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40, McHugh JA in the New South Wales Court of Appeal had cause to consider the issue of duress. The learned Judge said (at page 46):
“The proper approach in my opinion is to ask whether any applied pressure induced the victim to enter into the contract and then ask whether that pressure went beyond what the law is prepared to countenance as legitimate? Pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct. But the categories are not closed. Even overwhelming pressure, not amounting to unconscionable or unlawful conduct, however, will not necessarily constitute economic duress.
In their dissenting advice in Barton v Armstrong [1973] 2 NSWLR 598; [1976] AC 104, Lord Wilberforce and Lord Simon of Glaisdale pointed out (at 634; 121):
` ... in life, including the life of commerce and finance, many acts are done under pressure, sometimes overwhelming pressure, so that one can say that the actor had no choice but to act. Absence of choice in this sense does not negate consent in law: for this the pressure must be one of a kind which the law does not regard as illegitimate. Thus, out of the various means by which consent may be obtained - advice, persuasion, influence, inducement, representation, commercial pressure - the law has come to select some which it will not accept as a reason for voluntary action: fraud, abuse of relation of confidence, undue influence, duress or coercion.'
… Without the application of pressure by one party which induces the other to enter into the contract, there is no basis for the operation of the doctrine.
…”
27. Finally, in Cockerill and Ors v Westpac Banking Corporation [1996] FCA 1143, the bank went to some clients and effectively said, “You sign us a release for anything we might have done wrong, or else we are going to appoint a receiver to your business tomorrow”. The question was whether this amounted to duress. In discussing what pressure might be illegitimate and amount to duress, the Court referred with approval to what McHugh JA said above in Crescendo Management
28. The decision of Cooper J in Cockerill also makes it clear that an agreement induced by illegitimate pressure amounting to duress does not make the agreement void. It makes the agreement voidable. It can be affirmed, either expressly or by implication from conduct, after the illegitimate pressure is spent (see Universe Tank Ships Inc of Monrovia v International Workers Federation and Ors [1983] 1 AC 366 at 384). In Mr Filsell’s case, if he had wanted to set aside the consent agreement he would have needed to do so within a reasonable time and, once any pressure had been removed, not take any action that was inconsistent with avoiding the agreement. But, he did not do this. Two weeks after the agreement was made, there was a direction from Mr Clark to disperse the money payable pursuant to the agreement. Mr Filsell has retained the benefits of the agreement and continues to do so. It seems that, from his perspective, he believes he should be able to retain the money that has been paid and also set aside the agreement. If the agreement is set aside, the respondent will then be faced, some 11 years later, with a claim from Mr Filsell about something that took place in July 1999. Clearly, there comes a time when it becomes unreasonable for him to seek to set aside the agreement.
29. I have perused the details of duress contained in Mr Filsell’s Further and Better Particulars (Exhibit A1). It seems to me that the details missed the distinction between him feeling upset or annoyed about something and what might be regarded as illegitimate pressure to settle the case with the respondent. In terms of the documents in Annexure “A” of Exhibit A1 constituting illegitimate pressure, the majority are internal documents. They were never intended for Mr Filsell’s eyes and he obtained them because he required their production under freedom of information legislation. Illegitimate pressure does not arise where documents are produced as required under law, nor where a psychiatrist is engaged by the respondent to provide an assessment of Mr Filsell. In any event, it seems to me that a large proportion of the documents relate to conduct which is not the conduct of the respondent, but of the Department of Finance and Administration or other persons. Most of the conduct is remote in time to the point of settlement in July 1999.
30. The difficult personal circumstances that Mr Filsell found himself in, prior to the negotiations with the respondent, are obvious. They are matters of serious concern to him and I can understand how they might affect his decision-making. However, in my view, they do not amount to duress in terms of illegitimate pressure to settle. On the evidence, none of the actions, whenever they occurred on behalf of the respondent, involved the bringing of pressure to bear to settle the case. And it cannot be overlooked that, on the evidence, the respondent did not initiate the settlement discussions. It was Mr Filsell. In the discussions, he was represented by Mr Clark, and the negotiations had been freely entered into in the knowledge that there was such representation and absent knowledge about any difficulties that Mr Filsell might have had with his representation.
31. In looking at the involvement of Mr Filsell in the proceedings themselves, it is apparent that he did not understand what the hearing was all about. During the afternoon of the second day of the hearing, he said:
“What I guess I’m saying is that there are certain aspects of this that have been articulated many, many times and while you, sir, of course, are not aware of a lot of this, it’s been a matter of going over the same old ground hundreds of times and quite honestly, the fact that I may or may not have had something in the back of my mind in 1999, I do find difficulty in seeing the relevance of that particularly when we’re talking about a point in time that is well away from early July 1999. I can’t possibly see the direct pertinence in that”. [Transcript, page 119]
32. On the evidence, it is clear that what was going through Mr Filsell’s mind in July 1999 was that the agreement and the consent decision was not the end of any claim he might have against the respondent. An operative factor in his mind was the fact that there were other opportunities available to him against the respondent, and this was something that was a relevant consideration for him in assessing the proposal that he ultimately settled in July 1999. In cross-examination, he acknowledged that, in 1998, he wanted to initiate discussions to settle the matter. He had to make a decision, which was either to accept the settlement offer which he did not regard as being fair, or to proceed with the case which he had already decided he did not want to do. And, under extreme pressure and reluctance, he made the decision to accept the settlement offer.
summary and conclusion
33. The applicant has asserted that the consent decision that was made by this Tribunal on 6 July 1999 was induced by duress and should be set aside. There is no evidence to suggest that there was any pressure, let alone any illegitimate pressure, brought to bear on the applicant by the respondent which would constitute duress. The applicant wanted to settle the case and he initiated the discussions in August 1998 that ultimately resulted in the consent agreement and the consent decision. There is no basis for the consent decision to be set aside.
decision
34. For the reasons outlined above, the Tribunal affirms the consent decision under review.
I certify that the 34 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member R W Dunne
Signed: .............J Coulthard.........................................
AssociateDates of Hearing 17-18 August 2010
Date of Decision 12 November 2010
Advocate for the Applicant Self-represented
Counsel for the Respondent Mr M Roder
Solicitor for the Respondent Sparke Helmore
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