Francisco and Defence Force Retirement and Death Benefits Authori Ty

[2003] AATA 840

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2003] AATA 840

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2003/217

GENERAL ADMINISTRATIVE DIVISION		)
Re		JOHN FREDERICK FRANCISCO

Applicant

And DEFENCE FORCE RETIREMENT
AND DEATH BENEFITS AUTHORITY

Respondent

DECISION

Tribunal Mr RG Kenny, Member

Date29 August 2003 

PlaceBrisbane

Decision The Tribunal affirms the decision under review. 

....................(Sgd).....................

RG Kenny
  Member

CATCHWORDS

DEFENCE FORCES – benefits and entitlements - invalidity benefit – reclassification from Class B to Class C invalidity benefit – decision made in 1975 – application for review in 2001

PRACTICE AND PROCEDURE - extension of time to request reconsideration – length of time – considerations relevant to extension 

Defence Forces Retirement Benefits Act 1948
Defence Force Retirement and Death Benefits Act 1973 ss 3(1), 99(2)

Administrative Appeals Tribunal Act 1975 ss 29(7), 37

Re Killen and Defence Force Retirement and Death Benefits Authority [1999] AATA 517
Re Mulheron and Australian Telecommunications Commission (1991) 14 AAR 42

Re Schmack and Defence Force Retirement and Death Benefits Authority (1981) 3 ALN N77

REASONS FOR DECISION

29 August 2003  Mr RG Kenny, Member      

Background

1.      John Francisco (the applicant) was born on 21 July 1936 and served in the Royal Australian Air Force (RAAF) from 1955 until 20 January 1961 when he was retired on the grounds of being medically unfit for further service.  He was classified as 30% Class B for the conditions vaso-vagal (syncopal) attacks and duodenal ulcer under the Defence Force Retirement Benefits Act 1948 (the DFRB Act). He received a disability benefit until November 1971 when it was determined that it was no longer payable in accordance with the terms of the DFRB Act because of his level of employment. 

2.      On 1 October 1972, the Defence Force Retirement and Death Benefits Act 1973 (the DFRDB Act) came into force and changes to the manner in which disability benefit was paid under that new legislation led to a reconsideration of the applicant’s situation. On 1 May 1975, a Committee of the Defence Force Retirement and Death Benefits Authority (the respondent) determined that he should be reclassified as 25% Class C with effect from 1 October 1972. The applicant was advised of this decision by letter dated 19 May 1975 and he sought review of that decision in a letter dated 22 May 2001. On 6 November 2001, the respondent assessed the applicant’s incapacity and determined that it was to be continued at 25% Class C.

3. On 5 January 2002, the applicant sought review of the respondent’s decisions dated 1 May 1975 and 6 November 2001. On 30 August 2002, the respondent reconsidered its decision of 6 November 2001 and varied the applicant’s classification to 5% Class C. The respondent declined to review the decision of 1 May 1975 on the basis that the application for that review was outside the timeframe provided for in subsection 99(2) of the DFRDB Act and the respondent refused to allow the applicant an extension of that time. On 7 March 2003, the applicant sought review of the decision to refuse an extension of time and the matter is to be determined in accordance with the Administrative Appeals Tribunal Act 1975 (the AAT Act).

4.      The applicant attended the hearing and was represented by his daughter, Ms S Varga.  The respondent was represented by Mr B Dubè, from the Australian Government Solicitor’s Office.  In evidence were the following:

§Exhibit 1 - The document prepared in accordance with section 37 of the AAT Act (T Documents – T1 to T61);

§Exhibit 2 -    Statement of Facts and Contentions completed by the respondent;

§Exhibit 3 -    Statement of Issues completed by the applicant; and

§Exhibit 4 -    Letter written by the applicant to the respondent on 14 October 1974.

Issues and Legislation

5. It is not disputed that the only issue for determination in this matter is whether there should be an extension of time under sub-section 99(2) of the DFRDB Act to require the respondent to reconsider its decision, dated 1 May 1975, pertaining to the applicant. That provision reads:

“A person who is affected by a decision of the Authority and is dissatisfied with the decision may, by notice in writing given to the Authority, within a period of 30 days after the date on which the decision first comes to the notice of the person, or within such further period as the Authority allows, request the Authority to reconsider the decision.”

Applicant’s Contentions

6.      In his evidence, the applicant said that he could recall receiving a letter in 1975 in which he was advised that his invalidity benefit was to be reduced.  He also recalled that, before this, he had been for a medical examination and, when he read the letter, he thought it was a final statement of his position and he was not aware that he was able to seek a review of the decision to reduce his benefit.  He was aware that he had previously had a 30% Class B classification and was not aware that this percentage had been reduced.  He said that there was no explanation of the decision given to him.

7.      The applicant said he was an uneducated man who had busied himself in the years after he left the RAAF in physical work, often in remote communities, and that he did not concern himself with matters of compensation.  He also said that he placed heavy reliance upon his wife as the person who read official letters, completed official forms and dealt with any government agencies.  He said that he continued to have problems associated with his ulcer condition, including frequent bleeding, although this ceased after he underwent a surgical procedure in 1978.

8.      The applicant said that, in his post-service years, he had been mindful of warnings he had been given whilst in the RAAF that he was not permitted to speak of matters that related to his service for a period of some 30 years because of the terms of secrecy legislation.  He had been told that heavy fines or even a jail sentence could be imposed on him if he revealed service-related information and he had always believed that this included information concerning matters relating to his health.  However, in the late 1990s, he had come into contact with other servicemen who spoke of health and compensation matters and he decided to obtain his medical records.  These included the medical reports completed in 1975 and which appeared to him to be the basis upon which the decision was made to reduce his classification at that time.  In particular, he was made aware of the report, dated 10 March 1975, of physician Dr P Wakeford in which the opinion was expressed that his percentage of incapacity in relation to civil employment was the same as had been noted previously, namely 30% at that time and on a long-term basis.

9.      The applicant said that, when he received this information in 2001, he then made contact with the respondent by sending his letter of 22 May 2001 in which he requested that his payment be reinstated under the DFRB Act. 

10. Ms Varga submitted that, as the applicant had not been aware of the basis for the making of the 1975 decision until 2001, he should be treated as having been given notice of the decision only at that later time and that this would mean that his subsequent contact with the respondent meant that he had acted in a timely and diligent manner in accordance with sub-section 99(2) of the DFRDB Act.

11.     Ms Varga also submitted that, in the letter that was sent to the applicant on 19 May 1975, no advice had been given concerning the prospect of having the decision reviewed.  She submitted that the only reference in the letter to future matters was that, if the applicant experienced a significant deterioration in his condition, he could notify the respondent for a review to be made of his invalidity classification.

12.     Ms Varga submitted that the applicant was unaware of any of his rights under the compensation legislation and simply accepted the situation that had been explained to him in the letter of 19 May 1975.  She said that he was unaware of the role and jurisdictions of governmental agencies and submitted that he had always felt constrained by obligations not to disclose information which related to any aspect of his service life.  In particular, she said that he had served at Maralinga and that particular warnings had been given to those who served in that area in relation to secrecy undertakings.

13.     Ms Varga submitted that there had been an incorrect interpretation of the 1975 report of Dr Wakeford and that the respondent should have placed reliance upon that report in which case the applicant would have retained his 30% Class B classification. She also submitted that there would be no prejudice to the respondent in reviewing the decision because the medical evidence, in particular the report of Dr Wakeford, was still available.

14.     Ms Varga also submitted that the granting of an extension of time would not constitute unfairness to persons who were in a similar position to the applicant because exposure of a decision based on some error could only be beneficial to others.

Respondent’s Case

15.     Mr Dubè submitted that, prima facie, proceedings commenced outside the statutory timeframe should not be entertained and that, in order for an extension to be granted, the following matters were of relevance:

§  whether a reasonable explanation for the delay had been provided;

§  whether the person rested on his rights or took action to make the decision-maker aware the decision was being contested;

§  whether there was any prejudice to the respondent by granting an extension of time;

§  whether there was any wider prejudice to the general public in terms of disruption to established practice;

§  the merits of the substantial application; and

§  the fairness in granting the extension of time as between the applicant and other persons in a like position.

16.     Mr Dubè submitted that, on all of those bases, an extension should not be granted.  He submitted that no reasonable explanation for the delay had been given and submitted that it was not sufficient for the applicant to rely upon his lack of understanding of the basis of the decision to reduce him from Class B to Class C.  He conceded that the letter sent to the applicant in 1975 did not include an advice to him about his right to have the decision reviewed. However, he submitted that there had been deterioration in the applicant’s condition some time in 1978 when he had required surgery and yet, contrary to the letter written to him in 1975, he had not provided the information to the respondent about what must have been a significant deterioration.  This also meant that, by not contacting the respondent, he had rested on his rights at least from that point of deterioration.

17.     Mr Dubè referred to the long period of time that had elapsed in this matter between 1975 and the request for review in 2001 and submitted that, over such a period of some 26 years, there will be inevitable prejudice to the respondent if an extension were to be granted.  This was because it meant having to devote resources to investigating events which occurred some 26 years ago and he referred to the difficulties associated with the location of appropriate witnesses, the correctness of the recall of those witnesses and the likely destruction of any relevant documents. 

18. Mr Dubè submitted that it was against the public interest in the timely and efficient despatch of litigation to enable potential applicants to disregard time limits provided in the legislation and to bring matters forward at a time and place that best suits their chances of success. He also submitted that, in order to be successful, it was necessary for there to be at least a prima facie case to justify reclassification from Class C to Class B in 1975. He conceded that it was not possible to say that the applicant did not at least have a prima facie case of reclassification on the basis of Dr Wakeford’s report but submitted that, nevertheless, the discretion under subsection 99(2) of the DFRDB Act should not be exercised because an interpretation of that medical documentation left open some justification for reducing the classification. In that regard, he noted that the report of Dr Wakeford made reference to other medical conditions that the applicant had at the time. He said that this may well have been the basis for the respondent reducing his classification below the rating arrived at by Dr Wakeford.

19.     Finally, Mr Dubè submitted that it was unfair to others who may seek to exercise their rights within relevant time limits imposed by legislation if an extension of time were granted to the applicant.  He submitted that, where a person makes a conscious decision not to seek reconsideration until such time as they believed they had a greater chance of success, it was unfair to those who made a timely application.

Consideration

20. In this matter, it is not disputed that the applicant has an entitlement to an invalidity classification under the DFRDB Act for vaso-vagal (syncopal) attacks and duodenal ulcer. Also, it is not disputed that he was classified as Class B until reduced to Class C in May 1975 or that he was advised by letter, dated 19 May 1975, of this decision. In that letter, the applicant was advised that his entitlement had been reviewed and it continued:

“After a full consideration of your case, it was determined that your classification shall be varied from Class ‘B’ to Class ‘C’ and, accordingly, your pension (at present suspended) is now terminated. As the aggregate of pension paid to date exceeds a Class ‘C’ benefit, no further payment is due.

Should you experience a significant deterioration in your condition, you should notify this Office in order that arrangements may be made for an early review of your invalidity classification.”

21.     In his evidence, the applicant acknowledged that he had received that letter and I am satisfied that he was aware of the contents of the letter both as to the reduction in his classification and as to the prospect of advising the respondent of any subsequent deterioration.

22. The application for review of the decision in the letter of 19 May 1975 comprised a letter written by the applicant on 22 May 2001. Sub-section 99(2) of the DFRDB Act provides that a person affected by a decision and who is dissatisfied with the decision may request a reconsideration of that decision by giving notice in writing within a period of 30 days after the date on which the decision first came to the notice of that person. The provision also enables the period to be extended.

23. For the applicant, it was submitted that the decision did not come to his notice until he received information in 2001 about the medical report which was relied upon for the making of the initial decision. While I accept that this new information gave him some insight into matters relating to the making of the decision and provided him with a basis for his believing that the decision may have been incorrect, I am satisfied that the decision itself, which was to reclassify him as Class C, was encompassed in the letter written to him on 19 May 1975. Therefore, I am satisfied that the timeframe set out in subsection 99(2) was a period of 30 days from the date when he received that letter. Clearly, his letter seeking reconsideration of the initial decision was provided to the respondent long after the expiration of the 30 day period referred to in the provision. Indeed, it was more than 26 years later that the letter was sent. That, in itself, does not mean that the respondent is not required to reconsider the decision because the provision allows for time to be extended.

24. Sub-section 99(2) of the DFRDB Act provides no guidance in respect of the criteria to be applied in determining whether or not an extension of time should be granted. In Re Mulheron and Australian Telecommunications Corporation (1991) 14 AAR 42 at 48, the Tribunal summarised the principles to be applied in considering an application for an extension of time for review by the Tribunal under subsection 29(7) of the AAT Act. The principles were stated as being:

“(i)prima facie proceedings commenced outside the prescribed period will not be entertained.  An extension of time will be granted, however, if it is proper to do so;

(ii)it is relevant whether the applicant rested on his rights or took action to make the decision-maker aware that the decision was being contested;

(iii)any prejudice to the respondent that would be caused by granting the extension of time is relevant;

(iv)any wider prejudice to the general public in terms of disruption to established practices is relevant;

(v)the merits of the substantive application are relevant; and

(vi)fairness of granting the extension of time as between the applicant and other person in a like position is relevant.”

25. Those factors were reiterated in the context of an application for an extension of time under sub-section 99(2) of the DFRDB Act in Re Killen and Defence Force Retirement and Death Benefits Authority [1999] AATA 517 where the Tribunal also referred to an earlier decision of the Tribunal in Re Schmack and Defence Force Retirement and Death Benefits Authority (1981) 3 ALN N77. There, the Tribunal listed the following factors as being relevant to the granting of an extension of time:

“(a)the reason for the failure to lodge the request for reconsideration within the 30 days allowed by Parliament from making that request as of right;

(b)the length of the further time sought to be allowed;

(c)the diligence shown by the member in lodging his request for reconsideration after it came to his notice that there were circumstances justifying that request;

(d)the nature of the decision of which reconsideration was requested and the consequence of the decision upon the member’s rights or obligations under the Act;

(e)the adequacy of the information conveyed to the member at the time when the Authority’s decision was notified to him – both as to the basis of the decision and of his entitlement to request reconsideration;

(f)the extent of the applicant’s knowledge of the relevant provisions of the Act and his awareness that the decision in question involved a discretionary element, the exercise or non-exercise of which might affect the ultimate decision;

(g)the possible prejudice to the benefits scheme established by the Act if the time for reconsideration was extended as requested by the member; and

(h)the administrative difficulties in reconsidering the decision due to the absence or inadequacy of relevant evidentiary material after such a lapse of time.”

26.     The reasons given by the applicant for delaying so long before he sought review of the decision were that he was not advised of his right to seek a review of the decision in the 1975 letter and also that he was unaware of the basis upon which the decision was made until 2001.  It was conceded by Mr Dubè that the letter of 19 May 1975 did not advise the applicant that he had the right to review the decision and I am satisfied that this is the case.  However, the letter also stated that, in the event he experienced a significant deterioration in his condition, he was to notify the respondent of this so that his invalidity classification could be reviewed.

27.     In evidence before the Tribunal were the applicant’s treatment records for the period from 1975 until 1978.  During that period, he attended four consultations in respect of a variety of conditions.  No reference is made to any treatment for his vaso-vagal (syncopal) attacks but several entries appear in relation to his duodenal ulcer.  These indicate that he was treated for this condition with medication although, in November 1978, it is noted that he had increased pain for a period of three weeks.  This led to the conduct of a surgical procedure by Dr W Hunter in 1978.  Dr Hunter prepared a report, dated 3 June 2002, which reads:

“I can confirm that I treated Mr Francisco in November 1978 until April 1979.

He presented to me in November 1978 with typical and severe ulcer pain for the previous three weeks.  I noted that he had received medical treatment in the form of Tagamet in July 1977 and again in 1978 from his usual doctor Dr Lascado.  This treatment gave him some relief.  He was a smoker.  I can recall that he had a long history of ulcer type pain over many years.

A barium meal in November 1978 did confirm the presence of a duodenal ulcer, and he underwent truncal vagotomy and pyloroplasty at my hands on the 27^th November 1978.

Post operatively he had some dysphagia, and there was a suggestion of oesophageal stenosis, and he underwent esophagoscopy on the 14^th December 1978.  This improved his swallowing considerably.

I do recall that he recovered quite well after this and my notes say that he returned to work on the 2^nd January 1978.

I have not seen Mr Francisco since that time as far as I can recall.

I would expect Mr Francisco to recover completely from his surgery, and have no further trouble with peptic ulceration.  There is a rare condition where excessive acid is still produced despite surgery, and recurrent ulceration does occur.  I am unaware whether Mr Francisco had this rare condition known as Zollinger-Ellison Syndrome.

As far as his peptic ulcer condition is concerned, he would have been unfit for work at the time of his recurrent ulceration, namely during the period of 1977 and 1978 when he was on treatment, and he would have been unfit for work until the 2^nd January 1978 following his surgery.  I would expect him to have no restriction to his ability to work because of peptic ulcer disease after that time.  I am also aware that he had recurrent back problems.  I am unable to comment on how this affected him however.”

28.     There is no suggestion in the materials before the Tribunal that the applicant was unable to continue in employment because of his duodenal ulcer at any other time. In Dr Hunter’s report, it is stated that the applicant would have been unfit for work during the period 1977 and 1978.  However, there is no reference to absence from the workplace because of duodenal ulcer in the treatment records during that period.   The report of Dr Hunter reveals that, following surgery, the applicant’s condition improved dramatically and this was confirmed by the applicant in his oral evidence.  Nevertheless, the evidence shows that there had been a deterioration in his duodenal ulcer condition in 1978 and, given that surgical intervention was required, I am satisfied that this was a significant level of deterioration.  Despite that, the applicant made no attempt to contact the respondent to indicate that this had occurred.  I am satisfied that, had he done so at that time in 1978, it may well have led to a reconsideration of the decision made in 1975.

29.     The initial decision was made on the basis of a medical report that was prepared by Dr P Wakeford and which was dated 10 March 1975.  In that report, he described the applicant as suffering from symptoms of peptic ulcer, depression and headache and wrote:

“I find some difficulty in attempting to assess this patient on a percentage basis, on one examination.  Furthermore, because of his associated depression, high cigarette intake, previous known high ethanol intake, and his stress in his every day life, it is difficult to fix an arbitrary percentage.

Concurrent treatment for depression and anxiety, withdrawal of smoking, or severe restriction of same, could be expected to have beneficial effects.

Therefore I would assess his disability as unchanged from that noted previously, namely 30%.”

30.     The report of Dr Wakeford makes reference to conditions other than the two conditions for which the applicant’s accepted incapacity was related. These were depression and anxiety, headache and high alcohol consumption. While the reference by Dr Wakeford to an overall incapacity of 30% would support an outcome favourable to the applicant on review of the decision, the fact that there was input from other disabilities in that assessment vitiates against that outcome as does the stated difficulty that Dr Wakeford himself alluded to in making an assessment.  Further, the absence of other medical evidence indicates the difficulty that the respondent has in attempting to make an assessment of the applicant’s circumstances some 26 years ago. 

31.     The evidence of Dr Hunter points to a resolution of the problem of the applicant’s duodenal ulcer after the surgical intervention in 1978 and there is no reference in the evidence before the Tribunal of symptoms associated with his vaso-vagal (syncopal) attacks.  That level of symptoms is consistent with decisions made by the respondent on 6 November 2001 and 30 August 2002 whereby he was determined to be classified 25% Class C and 5% Class C, respectively. This was in reliance on a medical report, dated 6 September 2001, from Dr M Beg, consultant physician where duodenal ulcer is referred to only as part of the applicant’s medical history and where the focus is on the applicant’s heart condition and degenerative arthritis. Regard was also had to a report, dated 6 June 2001, from the applicant’s treating doctor, Dr R Jones, who refers to the history of duodenal ulcer concerns prior to surgery but lists the present ongoing problems of the applicant as being diabetes mellitus, ischaemic heart disease, hypercholesterolaemia and hypertension.

32.     I am satisfied that the difficulties associated with attempting to obtain material about the applicant’s conditions after a delay of more than 26 years places the respondent in the position where it would be prejudiced in determining the merits of the matter as at that time.

33.     The applicant relied on the Tribunal decision in Re Killen and Defence Force Retirement and Death Benefits Authority [1999] AATA 517. There, the authority had decided not to allow Mrs Killen an extension of time under sub-section 99(2) of the DFRDB Act to request reconsideration of the decision it made in 1981, namely, that Ms Killen did not satisfy the definition of "widow" in sub-section 3(1) of the DFRDB Act and, consequently, that she was not entitled to a widow's pension. The application for review in that case was lodged in 1996. The Tribunal granted the extension and noted that the only consideration against granting the extension was the lengthy period of time involved, ie 15 years. That case can be distinguished from the present on several grounds. Not only is the period of time involved much longer in the applicant’s case, ie 26 years, but the applicant was in a position where he had an opportunity to advise the respondent of his deteriorated condition in 1978 and did not do so. Also, in this case and as noted above, there is difficulty associated with analysing the medical evidence as it was in 1975.

34.     I accept the applicant’s evidence that he was not aware of the significance of the legislation or of his rights to seek a review.  Further, I am satisfied, on obtaining information in 2001 about the decision and the basis for it, he has acted diligently.  However, it is still the case that some 26 years have elapsed since the initial decision was made and, despite a worsening of his condition in 1978, the applicant has placed the respondent in the position where it would assume that the initial decision would not be questioned and where it would be prejudiced if it were required to review the decision.

35.     Having regard to the various factors listed above from Tribunal authorities, I am satisfied that time should not be extended to enable the application for review to be heard by the respondent.

Decision

36.     The decision under review is affirmed.

I certify that the 36 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RG Kenny, Member

Signed:         Sarah Oliver
  Associate

Date of Hearing  8 August 2003
Date of Decision  29 August 2003
For the Applicant  Ms S Varga (daughter) 
For the Respondent                  Mr B Dubè, Australian Government Solicitor