Formosa, J. v Social Security, Sec. to the Dept. of

Re: JOSEPHINE FORMOSA and THOMAS FORMOSA
And: SECRETARY TO THE DEPARTMENT OF SOCIAL SECURITY
No. G228 of 1988
Social Security - Statutory Interpretation - Estoppel
(1988) 46 FCR 117

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Davies(1), Burchett(2) and Gummow(1) JJ.

CATCHWORDS

Social Security - pensions - qualification to receive age pension arising on the attainment of 60 years of age - application made in writing six months after that date - whether an oral claim should be treated as having been made at an earlier date.

Statutory Interpretation - whether requirement that application for age pension be in writing mandatory or directory - distinction between mandatory and directory statutory provisions discussed - interpretation of statutory provisions containing both mandatory and directory requirements.

Estoppel - misleading advice by Government department - applicant not submitting claim for pension in reliance on advice - no estoppel to extend authority of decision maker beyond that given by statute.

Audit Act 1901

Acts Interpretation Act 1901

Social Security Act 1947

Administrative Appeals Tribunal Act 1975

Social Security Legislation Amendment Act 1983

Social Security Amendment Act 1987

Treasury Regulations

S.S. Constructions Pty. Ltd. v Ventura Motors Pty. Ltd. (1964) VR 229

Hunter Resources Ltd. v Melville (1988) 62 ALJR 88

A-G (NSW) Ex Rel. Franklin's Stores Pty. Ltd. v Lizelle Pty. Ltd.

(1977) 2 NSWLR 955

Victoria v The Commonwealth (1975) 134 CLR 81

The Justices of the Peace for Middlesex v The Queen (1884) 9 App Cas 757

Broadbridge v Stammers (1987) 76 ALR 339

Howard v Secretary of State for the Environment (1975) QB 235

NZ Institute of Agricultural Science v Ellesmere County (1976) 1 NZLR 630

Director-General of Social Services v Hangan (1982) 70 FLR 212

Grunwick Processing Laboratories Ltd. v Advisory, Conciliation and Arbitration Service (1978) AC 655

The Commonwealth v Crothall Hospital Services (Aust.) Ltd. (1981) 54 FLR 439

Australian Broadcasting Corporation v Redmore Pty. Ltd. (NSW Ct. of Appeal, 24/12/87, unrep.)

Re Bundy (1980) 2 ALD 735

Brickworks Ltd. v Warringah Corporation (1963) 108 CLR 568

Rootkin v Kent County Council (1981) 1 WLR 1186

The Council of The Shire of Sutherland v James (1962) 63 SR (NSW) 273

Re Callaghan (1978) 1 ALD 227

Howell v Falmouth Boat Construction Co. Ltd. (1951) AC 837

Victoria v The Commonwealth (1975) 134 CLR 338

A-G (NSW) v Gray (1977) 1 NSWLR 406

HEARING

SYDNEY

#DATE 17:8:1988

Counsel and Solicitors for Mr. T. Robertson instructed Applicant: by C.L. Sahlin of the Welfare

Rights Centre Ltd.

Counsel and Solicitors for Mr. A. Robertson instructed Respondent: by the Australian Government

Solicitor.

Counsel for the Applicants: Mr. T. Robertson

Solicitors for the Applicants: Craig Lewis Sahlin

Counsel for the Respondent: Mr. A. Robertson

Solicitor for the Respondent: Australian Government Solicitor

ORDER

That the appeal be dismissed.

That there be no order as to costs.

Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules.

JUDGE1

The Facts

This is an appeal under s. 44 of the Administrative Appeals Tribunal Act 1975 ("the AAT Act") from a decision of the General Administrative Division of the Administrative Appeals Tribunal ("the Tribunal"). The Tribunal was constituted by a Deputy President, and pursuant to sub-s. 44 (3) of the AAT Act, the jurisdiction of the Federal Court is exercised by a Full Court. The appeal is limited to questions of law: sub-s. 44 (1) of the AAT Act.

The Tribunal affirmed the decision under review which was to pay an age pension to the first applicant, Mrs. Formosa, from 27 November 1986, being the first pension pay day after she had lodged a claim for an age pension and not from an earlier date, the first payment day following her 60th birthday. Mrs. Formosa was born on 25 February 1926.
Age pensions are provided for by the Social Security Act 1947 ("the Social Security Act"). On the hearing of the appeal to this Court, counsel referred to the Social Security Act in the form it takes in the reprint as at 2 July 1987. Before the Tribunal, the Social Security Act was considered in the form it took before amendments effective from 1 July 1987. The principal sections involved were s. 135TA, s. 135TB and s. 135TBA; consequent upon the Social Security Amendment Act 1987, s. 50, and with effect from 1 July 1987, those sections were renumbered respectively as s. 158, s. 159 and s. 160. The only changes have been in enumeration of sections, and the substantive provisions have not been altered. Accordingly, we shall refer to these and other provisions of the Act as they stand in the current reprint.
Sub-s. 25 (1) of the Social Security Act provides that subject to the other provisions of Part IV of that Act, a woman who is not receiving an invalid pension and who has attained the age of 60 years and is residing in Australia on the date on which she lodges her claim for an age pension "shall be qualified to receive an age pension". Accordingly, Mrs. Formosa became qualified to receive an age pension on her 60th birthday, that is to say 25 February 1986. Sub-s. 159 (2) of the Social Security Act has the effect that a claim by Mrs. Formosa could properly have been lodged during the period of three months before she became qualified under s. 25 to receive an age pension.
As we have indicated, there is no doubt that a claim in proper form was lodged on 26 November 1986, and that pursuant to that application the age pension was granted and paid to Mrs. Formosa with effect from 27 November 1986.
The question agitated before the Tribunal and this Court is whether Mrs. Formosa is, as a matter of law, to be treated as having made an earlier application with the result that the pension was payable to her from the attainment of her 60th birthday on 25 February 1986; the amount involved is in excess of $2,500. This is a subject calling for comment.
Section 17 of the Social Security Act provides for the making, within the time limits there specified, of applications to the Administrative Appeals Tribunal for the review of a decision made by the Secretary to the Department which affirms, varies or sets aside a decision of an officer that has been reviewed by a Social Security Appeals Tribunal ("SSAT"). The decision before the Tribunal for review was that of a delegate of the Secretary, dated 14 May 1987, to affirm the decision of an officer (which had been reviewed by a SSAT) in respect of Mrs. Formosa's claim for an age pension, being a claim lodged 26 November 1986. The pension was granted with effect from 27 November 1986, and the dispute before the SSAT and the Tribunal was whether it should have been granted with effect from 25 February 1986, Mrs. Formosa's 60th birthday.
But it is important, in order to understand the footing on which the present appeal is brought to this Court from the Tribunal, to understand that (a) the steps laid down by s. 17 as founding the jurisdiction of the Tribunal and hence that of this Court have not been followed by Mrs. Formosa in respect of any alleged decision of an officer upon any alleged application in December 1985 or January 1986, and (b) although in respect of other categories of benefit there are provisions authorising payments to be "back-dated" to periods before a claim for the benefit was made (e.g. sub-ss. 76 (2) and 88 (2)), there is no such provision in respect of age pensions.
We have heard full argument on the issue of law which Mrs. Formosa raised and will deal with it, but in truth it was an issue strictly not open to her in these proceedings. This, of course, does not touch the question, which is not for our decision, as to whether an ex-gratia payment should be made to Mrs. Formosa.
In September 1985, Mrs. Formosa gave up a job as a waitress which she had held for about eighteen years. Her husband, the second applicant, had stopped working in February 1985. Mr. Formosa was then aged 63 years. He was in receipt of periodic compensation payments under workers' compensation legislation from approximately June 1985, in respect of a neck injury. The payments ceased on 14 November 1986 and a lump sum of $22,000 in redemption of the workers compensation payments was received at a later date.
On 2 December 1985, Mr. and Mrs. Formosa and their daughter attended at the Social Security Office at Mt. Druitt, a western suburb of Sydney. An officer of the Department was told that Mr. and Mrs. Formosa needed assistance and was asked whether there was any help available for them with the problems they were having with money. Mr. Formosa was given a form to fill out. The form was headed "sickness benefit". The passports, birth certificates and marriage certificate of Mr. and Mrs. Formosa were given to the officer who photocopied them. The officer asked Mr. and Mrs. Formosa to come back the next day. Mr. Formosa filled in the sickness benefit form. The form provided for the spouse of the applicant to declare, to the best of her knowledge and belief, the information furnished in the statement was true and correct. Accordingly, the form was signed both by Mr. Formosa as "Claimant" and by Mrs. Formosa as "Spouse". The form was signed on 3 December 1985, apparently in the presence of the interviewing officer at the Mt. Druitt office.
It was suggested in argument that the form was signed by Mr. Formosa for himself and as agent for his wife. However, the Tribunal made no such finding, saying that the form was signed by Mr. Formosa and was a claim for payment to himself. Accordingly, there was no foundation for an argument that there was a claim by Mrs. Formosa to a sickness benefit which might by favourable exercise of the Secretary's discretion under sub-s. 159 (5) of the Social Security Act be treated as a claim for an age pension.
It appears from the material before the Tribunal, although the Tribunal made no express finding to this effect, that on this occasion Mrs. Formosa was told that she was not entitled to any benefit because her husband was "on compensation". She was not asked her age (though presumably this would have appeared from the materials that had been photocopied), nor was she told that she might apply forthwith for an age pension in view of her imminent 60th birthday.
In January 1986, when the Formosas returned to the office at Mt. Druitt, she asked the officer whether there was "any help while my husband was on the compensation" and again she was told that she was not entitled to anything whilst her husband was receiving workers' compensation payments.
Mr. Formosa's claim for sickness benefit failed because he was in receipt of continuing compensation payments. A further application by him on 27 November 1986 was successful.
The Tribunal held that Mrs. Formosa had not lodged a claim in December 1985 for the payment of an age pension. The first question of law sought to be raised on the appeal is whether, in the circumstances of the case, there was what properly can be regarded as a claim for the payment to Mrs. Formosa of an age pension made in December 1985.
Mandatory or Directory?
The Tribunal held that the equivalent of what is now sub-s. 159 (1) of the Social Security Act was mandatory in character and required the lodgment of a claim in writing as a pre-requisite to the granting of the age pension.
Provision is made by ss. 33-36 for the rate of age pension that is payable. Pensions are paid out of the Consolidated Revenue Fund, which is appropriated accordingly by s. 181. The general administration of the Act is in the hands of the Secretary (s. 13) subject to any direction of the Minister and the Secretary may delegate to officers all or any of his powers under the Act (s. 14). Section 15 provides that a decision of an officer under the Act shall be in writing and s. 16 provides for a review by the Secretary of any decision of an officer. A decision under the Act shall be taken to be in writing if it is entered into or recorded with the use of a computer (sub-s. 15 (2)).
Section 158 provides that, inter alia, the grant or payment of an age pension "shall not be made except upon the making of a claim for that pension", and states that the Secretary shall, subject to the Act, determine claims. (It is to be noted that no such provision appeared in the legislation before the additions effected by s. 38 of the Social Security Legislation Amendment Act 1983, and the inclusion of this section is significant as, in a sense, governing the succeeding sections dealing with the making and determination of claims).
Sub-s. 159 (1) is of central importance. It provides as follows:

159. (1) A claim shall be made in writing in accordance with a form approved by the Secretary and shall be lodged -

(a) at an office of the Department in Australia; or

(b) at a place (whether inside or outside Australia), or with a person (whether inside or outside Australia), approved for the

purpose by the Secretary.
21. As we have said, the Tribunal found that the claim lodged on 3 December 1985 was a claim by Mr. Formosa for payment to himself. Plainly, the written instrument was not in form a claim for an age pension for Mrs. Formosa. Nor could it properly be considered as being in substance such a claim by her. However, counsel for Mrs. Formosa submitted that nevertheless a claim had been made by her by reason of what was said and done in December 1985 or January 1986 and that it was not fatal to her case that there was no claim by her in writing in accordance with sub-s. 159 (1) of the Act. There was no finding of fact by the Tribunal that any such informal claim was made by her. However, we put that to one side for the present and turn to the question of principle.
22. This is whether the grant or payment of an age pension may be made upon the making of a claim for that pension which is not (i) made in writing, (ii) in accordance with the form approved by the Secretary, and (iii) lodged in the manner indicated in sub-s. 159 (1) of the Social Security Act.
23. Counsel for the respondent submitted that s. 159, particularly when read with s. 158, imposes requirements which must be fulfilled before a claim is effective and that if there is absent compliance with the terms of sub-s. 159 there is no statutory authority for the disbursement of public moneys by payment of an age pension. Counsel for Mrs. Formosa said that these requirements were directory rather than mandatory.
24. The occasion for the drawing of this distinction has been explained as follows (Bennion, "Statutory Interpretation", pp 21-22): Where a duty arises under a statute, the court, charged with the task of enforcing the statute, needs to decide what consequence Parliament intended should follow from breach of the duty. This is an area where legislative drafting has been markedly deficient. Draftsmen find it easy to use the language of command. They say that a thing "shall" be done. Too often they fail to consider the consequence when it is not done. What is not thought of by the draftsman is not expressed in the statute. Yet the courts are forced to reach a decision.

It would be draconian to hold that in every case failure to comply with the relevant duty invalidates the thing done. So the courts' answer has been to devise a distinction between mandatory and directory duties.

It has been said ("Halsbury's Laws of England", 4th Ed, Vol. 44, title "Statutes", para 933) that:

No universal rule can be laid down for determining whether provisions are mandatory or directory; in each case the intention of the legislature must be ascertained by looking at the whole scope of the statute and, in particular, at the importance of the provision in question in relation to the general object to be secured. Thus it is not possible to generalise by reference to the nature of what is prescribed. No great reliance can be placed, either, on the suggestion that provisions framed purely in affirmative language are normally construed as directory, although the converse proposition, that negative provisions are prima facie mandatory, would seem on principle to be less open to criticism.

In S.S. Constructions Pty. Ltd. v Ventura Motors Pty. Ltd. (1964) VR 229 at 237-238, Gillard J. said:

In order to decide whether legislative provisions are mandatory or directory it would appear that there are certain guides to indicate, but there is no conclusive test to decide into which category legislation may fall. The scope and object of the statute, it is said in the cases, are of primary and possibly of vital importance. Secondly, provisions creating public duties and those conferring private rights or granting powers must be distinguished. The former generally are regarded as directory, whereas the latter are generally accepted as mandatory, particularly where conditions are attached to the exercise of the duty or the power, as the case may be. Thirdly, in the absence of an express provision, the intention of the legislature has to be ascertained by weighing the consequences of holding a statute to be directory or imperative.

The distinction between directory and mandatory requirements nevertheless remains somewhat elusive. It has been said that substantial compliance with a statutory requirement will be sufficient if the requirement is regarded as directory rather than mandatory. The authorities are collected and discussed by Dawson J. in Hunter Resources Ltd. v Melville (1988) 62 ALJR 88 at 94-95. As his Honour observes, a difficulty with the concept of "substantial" compliance lies in giving that term any scope for operation where the legislation specifies criteria that are absolute in character and do not permit of partial compliance. Thus, if an application is to be made in writing, it is hard to see how an oral application is substantial compliance.
On the other hand, there is much force in the view (advocated by Mr. Evans in his article "Mandatory and Directory Rules" (1981) 1 Legal Studies 227 at 230-231) that (a) directory rules are not to be defined as rules which require merely substantial compliance with a specified procedure, and that (b) the distinction between directory and mandatory requirements has its meaning and utility primarily upon consideration of the consequences of breach. Thus, if a rule, on its correct meaning, is satisfied by substantial compliance, then the rule may still be properly described as mandatory in character. This is because the rule, properly construed, must still be observed, and non-compliance will be fatal. But, if the consequence of non-compliance with what is stipulated by the rule (properly construed) is not to render ineffective the acts in question, then the stipulation may truly be said to have been directory and not mandatory in character.

This appears to have been the sense in which Reynolds J.A. understood the distinction between "directory" and "mandatory". In A-G (NSW) Ex Rel. Franklin's Stores Pty. Ltd. v Lizelle Pty. Ltd. (1977) 2 NSWLR 955 at 963-964, his Honour said:

This is but a compendious way of stating that, in some cases, the legislature intended that failure to comply with certain requirements would result in the invalidity of the act to which these requirements were precedent or that, on the other hand, non-fulfilment of the requirement did not result in the invalidity of the act.

See also the authorities collected by Stephen J. in Victoria v The Commonwealth (1975) 134 CLR 81 at 180; The Justices of the Peace for Middlesex v The Queen (1884) 9 App Cas 757 at 766-767; Broadbridge v Stammers (1987) 76 ALR 339 at 343; and Bennion, "Statutory Interpretation", pp 22-27.

We turn to consider the importance of the terms of sub-s. 159 (1) in relation to the general objects to be secured by the age pension provisions of the Social Security Act. There are, of course, public interests to be secured both by receipt of age pensions by those qualified to receive them and by ensuring that public funds are disbursed only to persons who satisfy the criteria specified in the statute.
In the nature of things, the form lodged by an applicant will be the document the applicant has obtained from an officer of the Department, rather than some holograph or informal instrument prepared by the applicant. The applicant, in the ordinary course, will have no knowledge whether or not the particular form that has been obtained from an officer of the Department is, in truth, a form approved by the Secretary within the meaning of sub-s. 159 (1) of the Social Security Act. Through some default in administrative procedures it may be that the form in use in a particular office of the Department is not the form currently approved by the Secretary. It would be, in such a case, a curious result if the claimant were to suffer, as a result of inadvertence within the Department, for the claimants' failure to comply with requirements spelled out in sub-s. 159 (1).
Accordingly, there may be much to be said for the argument that it is enough that the claim is made in writing substantially in accordance with the form approved by the Secretary. The point is probably put beyond doubt by s. 25C of the Acts Interpretation Act 1901, which states:

Where an Act prescribes a form, then, unless the contrary intention appears, strict compliance with the form is not required and

substantial compliance is sufficient.
33. Other difficulties not of the making of claimants might arise from the requirement that claims be lodged either (a) at an office of the Department in Australia or (b) at a place (inside or outside Australia) or with a person (inside or outside Australia) approved for the purpose by the Secretary. The identification of an office of the Department should not give rise to uncertainty, but the existence or non-existence of approval by the Secretary of a place or person may give rise by administrative inadvertence, to hardship to applicants who are not to know of irregularities in the procedures of the Department.
34. The answer may be suggested by those authorities which show that given requirements may be mandatory as to some of the integers therein and directory as to others: e.g. Howard v Secretary of State for the Environment (1975) QB 235; NZ Institute of Agricultural Science v Ellesmere County (1976) 1 NZLR 630 at 636. In this way the claimant would not fail because the claim had been lodged at what it transpired was not an approved place or with a person not approved by the Secretary because these integers in sub-s. 159 (1) were directory rather than mandatory.
35. However, that is not to say that the requirement that the claim be in writing and on a form is not mandatory. The subject matter of the claim is the disbursement of public moneys consequent upon the satisfaction of various criteria laid down in the statute for the payment of particular pensions, benefits and allowances. It would be to attend the administration of the legislation with the greatest uncertainty both for alleged claimants and for those charged with administration of the legislation if oral applications were to be treated as sufficient for the making of a claim. We would not see these difficulties as alleviated by the prospect of proceedings in a court or before an administrative tribunal to establish the making of oral claims in disputed cases.
36. The decision of an officer dealing with a claim must be in writing (s. 15) and it is that decision which may be reviewed by the Secretary under s. 16, unless the Secretary himself has determined the claim under sub-s. 158 (4). Further, sub-s. 181 (1) provides, inter alia, that where an amount has been paid by way of pension which would not have been paid but for a failure or omission to comply with any provisions of the Act, that amount is a debt due to the Commonwealth: see Director-General of Social Services v Hangan (1982) 70 FLR 212 at 232. The Secretary may write off or waive such debts in the circumstances described in s. 186; a power of waiver is also given by s. 70C of the Audit Act 1901.
37. In our view, the requirement in s. 159 (1) of the Social Security Act that a claim shall be made in writing is of central importance to the administration of the legislation and the sub-section cannot, consistently with the scope and object of the statute, be read as if a claim for a pension is sufficiently made if made orally at an office of the Department to an officer of the Department. The requirement that claims shall be made in writing is not to be characterised as a "mere matter of machinery for carrying out the undoubted purposes of the Act" (cf. Grunwick Processing Laboratories Ltd. v Advisory, Conciliation and Arbitration Service (1978) AC 655 at 690).
38. In The Commonwealth v Crothall Hospital Services (Aust.) Ltd. (1981) 54 FLR 439 at 454, the Full Court held that non-compliance with the Treasury Regulations which were made under the Audit Act 1901 and dealt with the form of purchase orders, could not be used by the Commonwealth to defeat a claim to payment for services rendered to and accepted by it under a running contract. The decision is discussed by Mr. D.J. Rose in his paper "The Government and Contract", reprinted in Finn (ed.) Essays on Contract 232 at pp 249-252; see also Australian Broadcasting Corporation v Redmore Pty. Ltd. (NSW Ct. of Appeal, 24/12/87, unrep.). The interests involved in the present litigation are essentially different in character, as we have endeavoured to explain them, and, of course, arise under different legislation.
39. In any event, the facts of the present case do not, in our view, show that any oral claim was made by Mrs. Formosa for an age pension. To put her case at the highest, she was seeking advice as to what, if any, social security benefits were obtainable by her. Section 158 provided that an age pension should not be granted or paid except upon the making "of a claim for that pension" (italics supplied). Mrs. Formosa did not make any claim, orally or in writing, for an age pension.

Estoppel

Counsel for the applicants also relied on estoppel. He submitted that by submitting her documents for identification, attending an interview for the purposes of ascertaining her entitlements, signing a form in the course of that interview to support her claim and receiving information from the officer of the Department that she had no entitlements, Mrs. Formosa was led to believe that she had made a claim and that her claim was unsuccessful; it was then submitted that Mrs. Formosa had acted to her detriment on those assumptions by failing to apply for an age pension before November 1986, and that the Department had fostered her mistaken belief by giving her incorrect information, acting as if she had made a claim and repeating the incorrect information in January 1986.
Counsel agreed that he had to say, to make the submissions good, that the respondent was estopped from denying that in December 1985 or January 1986 Mrs. Formosa had lodged with the office at Mt. Druitt a claim in writing in accordance with a form approved by the Secretary, for an age pension to commence 25 February 1986. Thus the result of that estoppel would be to lift the prohibition placed by s. 158 (1) upon the payment of the age pension to Mrs. Formosa, except upon the making of a claim in the manner described in sub-s. 159 (1).
A collection of the authorities revealing the somewhat uncertain state of the law as to the fettering by estoppels of the proper exercise of statutory discretions may be found in Re Bundy (1980) 2 ALD 735 at 750. However, in Brickworks Ltd. v Warringah Corporation (1963) 108 CLR 568 at 577, Windeyer J. said that there was no doubt about the principle that estoppel by representation cannot prevent the performance of a statutory duty or the exercise of a statutory discretion.
Where the issue is one of statutory discretion, the operation of an estoppel may cut across the proper exercise of the discretion reposed by legislation in a specified decision maker and thus be at odds with what is mandated by the legislation. Hence, the observation by Professor David Williams ((1981) CLJ 198), in commenting upon Rootkin v Kent County Council (1981) 1 WLR 1186, that estoppel appears to operate only at the periphery of judicial review of administration, and, more recently, the view that the foundation for the protection of "legitimate expectations" lies elsewhere than in estoppel (Forsyth, "The Provenance And Protection of Legitimate Expectations" (1988) CLJ 238 at 257-258).
The present is a case of right and obligation rather than discretion. If a claimant to an age pension satisfies the criteria specified in s. 25 of the Social Security Act for qualification and if a claim is made in accordance with s. 159, then, in the ordinary course, the claim should be determined in favour of the claimant and, subject to the determination of the rate of the pension (ss. 33-36), there is no area for the exercise of discretion by the decision maker. But if there has been no claim for that pension which complied with s. 159, then the grant or payment of the pension shall not be made: sub-s. 158 (1). The effect of the estoppel sought to be established in the present case would be, as we have said, to lift the prohibition imposed by sub-s. 158 (1) and extend the authority of the decision maker beyond that given by the statute. This cannot be achieved by an estoppel: The Council of The Shire of Sutherland v James (1962) 63 SR (NSW) 273 at 278-279, per Sugerman, Manning JJ; Re Callaghan (1978) 1 ALD 227 at 230-231.
Further, any payment of an age pension to Mrs. Formosa in respect of the period in dispute would conflict with the related principle that estoppel does not operate so as to sanction the appropriation of public moneys without the authority of the Parliament: Howell v Falmouth Boat Construction Co. Ltd. (1951) AC 837; Victoria v The Commonwealth (1975) 134 CLR 338 at 353, 370-371, 392, 410-411, 421-423; A-G (NSW) v Gray (1977) 1 NSWLR 406 at 410-412, 413; cf. The Commonwealth v Crothall Hospital Services (Aust.) Ltd. (1981) 54 FLR 439 at 453.
There was much debate before us as to whether the Tribunal had found the facts necessary for the existence of the estoppel claimed before us by Mrs. Formosa. There is much force in the respondent's submission that, the appeal to this Court being limited to questions of law, the findings of fact by the Tribunal amounted to no more than the statement that it lacked sufficient information to express an opinion on the matter.
But, in any event, the matters we have discussed above are fatal obstacles to acceptance of the case sought to be made on estoppel.
The appeal should be dismissed.

JUDGE2

I agree that this appeal should be dismissed. I do so on the simple ground that Mrs. Formosa did not in the relevant December or January make any claim for an age pension, nor, indeed, for any other kind of pension. Therefore, the question whether such a claim, had it been made, would have been sufficient, if made orally, does not actually arise for decision. Nor do the facts, in my opinion, support any possible estoppel.

However, with great respect, I am unable to concur in the view that s.159 makes it mandatory that a claim for a pension should be in writing. I regard the provision as directory only.
Sections 158 and 159 are the opening sections of Part XVIII, which is headed "CLAIMS, PAYMENT, NOTIFICATION, REVIEW, CANCELLATION AND RELATED MATTERS". In their context, they are clearly intended to be read together. To my mind, it is significant that s.158(1) provides:"The grant or payment of (a pension and various other benefits and allowances) shall not be made except upon the making of a claim for that pension, benefit or allowance"; whereas s.159(1) contains no comparable provision that any vitiating consequence shall follow if its terms are not precisely complied with. What s.159(1) does is simply to declare that:

"A claim shall be made in writing in accordance with a form approved by the Secretary and shall be lodged -

(a) at an office of the Department in Australia; or

(b) at a place (whether inside or outside Australia), or with a person (whether inside or outside Australia), approved for the purpose by the Secretary."

There is, as I understand it, no suggestion that any of the requirements of this provision is mandatory, except the requirement of writing. It would be difficult to comprehend a legislative intention to render void an application for failure to comply with requirements in respect of which the applicant could not know the true position, such as a defect in the process of approval of a form, the designation within the Commonwealth service of an office, or the approval of a place or a person by the Secretary. I acknowledge that it is possible for some parts of the one provision to be mandatory while others are directory only; however a context in which a provision (s.159(1)) follows another provision (s.158(1)), which is expressed as clearly mandatory, while the provision in question employs markedly different language, capable of being understood as directory only, and associates the particular requirement with other requirements that are certainly directory, is not a context which naturally suggests a mandatory construction. Furthermore, sub-s.(2) of s.158 makes it plain that "a claim for a pension benefit or allowance" may be "made by or on behalf of a person". (Emphasis added.) It is easy to imagine circumstances in which individuals, whose claims are the subject of this Act, may be quite unable to make an application personally. Often they will be ill or infirm. It does not seem to me likely that the legislature would intend a mandatory provision, as to the form of a claim, to be the means of shutting out such a person from a general entitlement granted to members of the Australian community in his position, simply because his nearest relative (who would be the obvious person in many cases to apply on his behalf) had little understanding of the requirements, and an officer of the Department failed to give appropriate guidance.

It is to be noted, too, that by s.3(1) it is provided that:

"In this Act, unless the contrary intention appears ... 'claim' means a claim for a pension, allowance or benefit made, or deemed to have been made, under this Act."

If it had been intended to confine claims absolutely to those in writing, it would have been very easy, and natural, to have so provided in the definition.

The contrast, as a matter of language, between s.158 (with its provision that grant of a pension shall not be made except upon the making of a claim) and s.159 (with its various requirements including that a claim shall be made in writing in accordance with a form, but without the attaching of any express consequence to neglect of those requirements) mirrors quite precisely the old case of Thompson v. Harvey (1859) 4 H & N 254. There, the first section of a licensing Act provided that no licence to sell beer by retail "shall be granted to any person who shall not be the real resident, holder, and occupier of the dwelling-house in which he shall apply to be licenced;" and the section went on to provide that "every licence granted contrary thereto shall be null and void." By contrast, the second section provided that "every (applicant for a licence) to retail beer or cider shall produce ... a certificate in writing from an overseer ... that such applicant is the real resident, holder and occupier of the said house;" but that provision said nothing of the consequence of non-fulfilment. The Court of Exchequer held, as a matter of construction, that the first section was mandatory but the second was merely directory. Martin B. (stating a rule of construction which Barton J. relied on in Chanter v. Blackwood (1904) 1 CLR 39 at 60) said at 262:

"It is a rule of construction that matters shall not be deemed to be conditions precedent unless they are declared to be so. That is a sound rule to apply to statutes, and unless the legislature has in plain words said that a certain thing shall be a condition precedent, we must not so construe it. I am of opinion that a certificate from an overseer that the applicant is the real resident, holder, and occupier of the house was never intended to be a condition precedent to the granting of the licence. No doubt the commissioners of excise, before granting the licence, ought to see that the provisions of the 2nd section are complied with; and they ought not to grant the licence without a certificate, unless there is sufficient reason for dispensing with it; but, if they do, the licence is not null and void."

Watson B. was of the same opinion. He said at 264:

"I am satisfied that the only object of requiring a certificate was to afford the officer the means of obtaining the necessary information, and that his jurisdiction to grant the licence does not depend on the production of the certificate. ... But when we look at the 1st section, it is clearly imperative - 'no licence shall be granted to any person who shall not be the real resident, holder, and occupier of the dwelling-house.' It does not say that no licence shall be granted to any person unless he has obtained a certificate, or that a person shall be deemed a householder if he has obtained a certificate. The 1st section also says that every licence granted contrary thereto shall be null and void; and when we find such strong terms in that section, how can we import them into the second? If a person who was not a householder obtained a licence, it would be void; but I am clearly of opinion that the provisions of the 2nd

section are directory only."
6. Powerful though the textual argument which appealed to the Court of Exchequer in Thompson v. Harvey appears to me to be (a like argument, not in the clear case of contrasting sections in the same Act, but where the contrast arose with sections in Acts in pari materia, was accepted by Griffith C.J. in Chanter v. Blackwood (supra) at 53), I accept that in a particular instance, even of legislation similarly expressed, the evident policy of a provision could properly sway a court to a different conclusion. However I can see no such evident policy in s.159. The suggestion that a claim not made in writing would inevitably produce severe problems for the administration of the Act seems to me, with respect to those who think otherwise, to lack reality. Of course a claim should be in writing, and s.159 requires that it shall be; the question is simply, what is the consequence of a failure to comply with that provision? If I am right, a claimant who failed to comply would still have to prove, in appropriate proceedings, not only his entitlement as a person qualified, but also the making of his informal claim. That this should, on a rare occasion, be necessary does not seem to me to threaten such serious consequences as to require a court to hold that language, which is set in a directory context, must by some imperious call of administrative necessity be construed as mandatory - especially since the Act should be given a beneficial, rather than a restrictive, construction, one in favour of those aged and infirm persons whose failing capacities are the ground of its operation, and a likely cause of non-compliance.

7. There have been various attempts to state the principle which distinguishes between mandatory and directory provisions of statutes. The question should not be viewed as other than one of construction of the true meaning of the legislation. In Chanter v. Blackwood (supra) at 51 Griffith C.J. cited a dictum of Lord Campbell, L.C.: "No universal rule can be laid down for the construction of Statutes, as to whether mandatory enactments shall be considered as directory only or as obligatory, with an implied nullification for disobedience. It is the duty of Courts of Justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the Statute to be construed."

In their dissenting judgment (which is not in this respect inconsistent with the majority judgment) in Hunter Resources Ltd v. Melville (1988) 77 ALR 8 at 11, Mason C.J. and Gaudron J. say:

"It is a matter then of construing the relevant provisions of the Act in their context which of course includes the scope and purpose of the statute."

When a court searches for the intention expressed by Parliament in a particular section of an Act, there may be some artificiality in attributing to the legislature a stark choice between a legal category described by lawyers as "mandatory" and another category described as "directory". Parliament may not have attended to any such distinction, and what it has provided, properly construed, may have a more flexible effect than either category would allow. I think this is an aspect of what Lord Hailsham of St. Marylebone L.C. was referring to when he said in London & Clydeside Estates Ltd v. Aberdeen District Council (1980) 1 WLR 182 at 190, in the course of a speech with which Lord Wilberforce expressed his concurrence:

"In such cases (his Lordship was speaking of what he had earlier described as 'the field of the rapidly developing jurisprudence of administrative law, and ... the effect of non-compliance by a statutory authority with the statutory requirements affecting the discharge of one of its functions'), though language like 'mandatory,' 'directory,' 'void,' 'voidable,' 'nullity' and so forth may be helpful in argument, it may be misleading in effect if relied on to show that the courts, in deciding the consequences of a defect in the exercise of power, are necessarily bound to fit the facts of a particular case and a developing chain of events into rigid legal categories or to stretch or cramp them on a bed of Procrustes invented by lawyers for the purposes of convenient exposition. ... I do not wish to be understood in the field of administrative law and in the domain where the courts apply a supervisory jurisdiction over the acts of subordinate authority purporting to exercise statutory powers, to encourage the use of rigid legal classifications. The jurisdiction is inherently discretionary and the court is frequently in the presence of differences of degree which merge almost imperceptibly into

differences of kind."
9. The lawyer's attempt to classify statutory commands into one of two categories has led to confusion, particularly with regard to the consequences of holding that a particular command is directory only. Dawson J. referred to the problem in Hunter Resources Ltd v. Melville (supra) at 17-18. The ambiguity of the word "directory" is neatly exposed by Rubinstein in his Jurisdiction and Illegality (1965) at p 4 where he says: "'Directory' usually designates a provision, the disregard of which has no effect on the resulting act: Brumfitt v. Bremner (1860), 30 LJCP 33; but wilful disregard of directory provisions may be punishable in criminal proceedings and in that sense they are not leges imperfecta ... . 'Directory' may also mean statutory provisions which do not have to be followed accurately but 'it is sufficient if a directory enactment be obeyed or fulfilled substantially': per Coleridge C.J. in Woodward v. Sarsons (1875), LR 10 CP 733, at 747."

See also Attorney-General (N.S.W.) Ex Rel. Franklins Stores Pty Ltd v. Lizelle Pty Ltd (1977) 2 NSWLR 955.

It is unnecessary, in this case, to follow up all the implications of the prescription of writing imposed by s.159. In my opinion, the provision is directory in the sense that its non-fulfilment has no vitiating effect upon a claim made pursuant to the requirement laid down by s.158. In particular, the obligation placed upon the secretary, subject to the Act, by s.158(4) to determine the claim, if one had in fact been made here, would not in the other circumstances in evidence have failed to attach. Whatever may have been thought to have been the position prior to the statements made in the reasons given by Lord Russell of Killowen in the Privy Council in Mukta Ben v. Suva City Council (1980) 1 WLR 767 at 778 and by Dawson J. in the High Court in Hunter Resources Ltd v. Melville (ubi supra), total non-compliance with a merely directory provision does not necessarily invalidate a claim.
In concluding these reasons, I think it is desirable to draw attention to the Tribunal's acceptance of the proposition that, after the applicant had seen an officer of the department, she may nevertheless not have fully appreciated the necessity for her, as well as her husband, to fill in a form. This comment should be seen in the light of the material before the Tribunal, including the statement of a senior advisory officer of the department:

"I would be prepared to accept that Mrs. Formosa was given inadequate information as her subsequent action of applying for an age pension in her own right or immediately her husband's compensation ceased is consistent with the inadequate information she claimed to have received. The Tribunal was satisfied that Mrs. Formosa was misled by an officer of the department and from my experience of busy regional office counter areas I would not be surprised if the alleged misinformation was actually given as claimed."

I emphasize, what should already be apparent, that my reason for concurring in the dismissal of the appeal is Mrs. Formosa on two occasions made inquiries, but no application. The senior advisory officer's statement suggests that the explanation for her failure to do anything more was that she was misled. In these circumstances, if in fact the applicant (taking into account any property or income of her husband and herself which should be taken into account) should have received any payments of pension for the period 25 February 1986 to 13 November 1986, her loss might well be thought by the appropriate authority to be precisely the kind of thing s.34A of the Audit Act 1901 was designed to remedy. A statement made on 5 August 1980 by the then Minister for Finance, which is reproduced in Dr. Pearce's The Australian Administrative Law Service at pp.6049-6050, lays down as the first guiding principle for the application of s.34A that it covers a case "where a public servant or other person acting on behalf of the Government, in the exercise of his duties, has given incorrect information (or taken some action) which has led the claimant to taking a course which was to his financial detriment." I note that the material before the Tribunal included a calculation suggesting the applicant's loss was $2,512-60, but I do not know whether this should be regarded as accurate.

In my opinion, the appeal should be dismissed.

[1988] FCA 448

17 AUGUST 1988