Hardy and Comcare

[2007] AATA 1923

Administrative Appeals Tribunal

DECISION AND REASONS FOR INTERLOCUTORY DECISION [2007] AATA 1923

ADMINISTRATIVE APPEALS TRIBUNAL      )     Nos T2006/67 &

)              T2006/24

GENERAL ADMINISTRATIVE   DIVISION		)
Re		ANGELINE DEBORAH HARDY

Applicant

And COMCARE

Respondent

INTERLOCUTORY DECISION

Tribunal Ms A F Cunningham (Senior Member)

Date2 November 2007  

PlaceHobart

Decision The interlocutory application is dismissed.

..............................................

Senior Member

CATCHWORDS

COMPENSATION - interlocutory application - validity of decision under review ceasing liability to pay compensation - reviewable decision made by respondent of its own motion - decision alleged to be invalid in absence of change of circumstances and contrary to principals of equity and fairness - no demonstrated breach of statute - application dismissed - Tribunal will proceed to merits review

Safety Rehabilitation & Compensation Act 1988, ss 4(1), 14, 62, 62(1), 62(5), 72

Explanatory Memorandum to the Commonwealth Employees Rehabilitation & Compensation Bill 1988

Seafarers Rehabilitation & Compensation Act 1972, s.79

Administrative Appeals Tribunal Act 1975, s.33

Administrative Decisions (Judicial Review) Act 1977, s.5

Hart v Comcare [2005] FCAFC 16

Telstra Corporation v Hannaford [2006] FCAFC 87

Re Quinn and Australian Postal Corporation (1992) 15 AAR 519

Collector of Customs (NSW) and Brian Lawlor Automotive Pty Ltd (1979) 24 ALR 304

Hospital Benefit Fund of Western Australia Inc v Minister for Health, Housing and Community Services (1992) 111 ALR 1

Re Knoll Australia Pty Ltd & Minister for Health and Aged Care (2000) AATA 926

Trajkovski v Telstra Corporation Ltd (1998) 153 ALR 248

Zubair v Minister for Immigration and Multicultural and Indigenous Affairs [2004] 139 FCR 344

Bao v Minister for Immigration and Multicultural and Indigenous Affairs (2005) FCA 270

Teo and Minister for Immigration and Citizenship (2007) AATA 1118

Minister for Immigration and Multicultural and Indigenous Affairs v Ahmed (2005) 143 FCR 314

REASONS FOR DECISION

2 November 2007   Ms A F Cunningham (Senior Member)   

1.      On 28 November 1993 (the first claim) the applicant made a claim pursuant to the Safety Rehabilitation & Compensation Act 1988 (the SRC Act) for compensation with respect to an injury to her back resulting from incidents in the course of her employment with the Commonwealth Department of Transport on 6 August and 6 September 1993.  Liability was accepted on 16 December 1993. 

2.      On 9 November 1994 (the second claim) the applicant made a claim pursuant to the Act for compensation in respect of severe stress and anxiety.  The respondent accepted liability for acute anxiety on 23 November 1994.  Compensation was paid for both claims until 18 October 2005.  On that date the respondent determined to cease liability for payment of compensation pursuant to section 16 and 19 in respect of the second claim.  A determination to cease liability for payment of compensation pursuant to sections 16, 19 and 29 in respect of the first claim was issued on 29 November 2005.  On 7 February 2006 a review officer affirmed the decisions to cease liability for payment.  The decision with respect to the first claim for back injury was affirmed on the basis that there was no longer any connection between the injury and the applicant's current capacity and need for treatment.  The determination with respect to the second claim for acute anxiety was affirmed on the basis that pursuant to the decision of Hart v Comcare [2005] FCAFC 16, liability should not have been originally accepted for the claim.

3.      The applicant has lodged applications for review of the reconsiderations dated 7 February 2006 and contends that her incapacity and need for treatment in respect of both injuries is ongoing.

4.      A preliminary issue has been raised by the applicant concerning the validity of the respondent's determination to cease liability some 11 years after the issuing of a decision accepting liability.  The applicant submits that the reviewable decision is invalid for the following reasons.

(i)        There was no valid determination pursuant to s.62 of the SRC Act in          the absence of a change in circumstances.

(ii)       The decision is contrary to principals of equity and fairness which are            fundamental to the decision-making process. 

Change of Circumstances

5.      The respondent contends that a determination can be reconsidered by it of its own motion at any time pursuant to the provisions of s.62(1) of the SRC Act.  The respondent disputes that a reconsideration pursuant to s.62 must be founded on a change in the applicant's circumstances.  The respondent refers to sub-section 62(5) which states:

'Where a person reconsiders a determination, the person may make a decision affirming or revoking the determination or varying the determination in such manner as the person thinks fit".

6.      It is submitted that the intention of the legislation is to allow for on-going review of decisions in the light of evolving circumstances.  Section 62 affords the decision-maker a broad power to review determinations of its own motion as it sees fit.  The applicant acknowledges the respondent's authority to revoke a previous Section 14 acceptance of liability.  Counsel for the applicant referred to the decision of the Full Court of the Federal Court in Telstra Corporation v Hannaford [2006] FCAFC 87 which reviewed the relevant provisions of the Act and where the Court said at paragraph 57:

"The statutory scheme allows for progressive and evolving decision-making giving effect to the provisions of ongoing review of relief or entitlements in the nature of course of workers compensation, being review which allows for adjustment or change in the light of events and circumstances which may subsequently happen. The statutory scheme hence reflects a flexible scope for adjustment by way of decisions in the nature of awards to be made subsequently to the determination of s 14 liability, whether that determination be made in isolation, or in the context of decision-making concerning consequential relief that may be required in the light of evolving circumstances".

As Justice Heerey commented in that case, progressive and evolving decision-making can be in the interests as much for employees as employers.

7.      The Full Court in Hannaford supported the AAT's review process in the making of a finding that Mr Hannaford did not suffer from Ross River Fever on the basis of the uncontradicted expert evidence before it that the positive IgM antibody, an essential component of the disease was not present in Mr Hannaford's serology. 

8.      The Court concluded that a correct construction of the Act empowers the AAT to make subsequent findings pursuant to the SRC Act where the determination at first instance made under s.14 remains in operation in the sense that it has not been the subject of a subsequent review by the AAT producing a different outcome.  The statutory scheme allows for such progressive and evolving decision-making and adjustment of entitlements in the light of events and circumstances which may subsequently happen.  The Court noted that a reconsideration made pursuant to s.62 is not subject to any time limit.  This is at variance with the provisions of the Seafarers Rehabilitation & Compensation Act 1972 where statutory time limits are imposed by the provisions of s.79 of that Act.

9.      The applicant relies on Hannaford's decision and the decision of the AAT in Re Quinn and Australian Postal Corporation (1992) 15 AAR 519 to support a submission that in the absence of a change of circumstances there can be no justification for a reconsideration of the elements of foundational liability pursuant to s.14 of the SRC Act.

10.     In particular counsel for the applicant relied on the Tribunal's statement in Re Quinn at page 525 being as follows:

"In our view, as it is clear from the statutory intention that the respondent can only reconsider a determination when there has been a change in circumstances, it seems justifiable to expect the respondent to be able to produce material in these proceedings supporting its assertion that the applicant is no longer entitled to compensation.  There is no strict burden of proof as such but there must be additional evidence to indicate that there has been such a change of circumstances.

In this case there has been a prima facie change in circumstances demonstrated by the medical reviews sought by the respondent.  Irrespective of whether those medical reports relate to matters which should not properly be considered part of this Tribunal's proceedings, they can be seen to offer support for a lack of continuing incapacity demonstrating a change in circumstances since the previous Tribunal decision".

11.      Quinn's case concerned the ability of the AAT to review a determination when the Tribunal had previously heard an appeal with respect to the same individual and her incapacity arising out of a work-related injury.  The Tribunal considered whether the doctrine of issue estoppel applies to administrative decisions and decided that it did not need to decide the issue in this case.  The Tribunal said at page 525:

"The Tribunal's process is administrative and in understanding the task of review is obliged to consider the administrative consequences and fairness of the investigation it makes in reaching the correct and preferable decision.  The policy basis upon which the doctrine of estoppel rests, that is, "it is for the common good that there should be an end to litiigation" and "no one should be harassed twice for the same cause", are relevant to administrative law.  The Tribunal should be guided by the principles of "equity, good conscience and the substantial merits of the case, without regard to technicalities".

12.      The Tribunal referred to the Explanatory Memorandum to the Commonwealth Employees Rehabilitation & Compensation Bill 1988, the Notes to Clause 60 (which became s.62 in the legislation) which read at page 524:

"Subclause 60(1) will permit the Commission or an administering authority, of its own motion, to reconsider a determination, whether or not the determination is or has been the subject of review by the Administrative Appeals Tribunal.  The Commission or administering authority may affirm, revoke or vary that determination in such manner as it thinks fit.  A determination which has been reviewed by the Tribunal would be reconsidered by the Commission or an administering authority only following a change in the circumstances surrounding the claim".

13.      The Tribunal went on to state at page 526:

"It would seem inappropriate and unreasonable to us for there to be relitigation without reason of the same issues before the Tribunal.  It would be unjust to applicant to have to face a situation where a decision may be made today and relitigated tomorrow on the very same facts.  The Tribunal should not generally allow relitigation of issues already decided and previous Tribunal decisions should be regarded as establishing the matters actually decided and of the grounds for the determination.  In compensation cases like the present, the issues of causation and level of incapacity for the period the subject of the earlier decision would thus not be areas contested in a subsequent hearing".

14.      It is apparent from the Tribunal's reasoning in Re Quinn that it considered that there should not be a review of the same issues and facts already decided by a previous Tribunal without evidence of a change in circumstances relating to the claim. 

15.      The respondent sought to distinguish Quinn's case from the present on the basis that there has not been a previous merits review by the Tribunal of the compensation liability determinations which found the Tribunal's requirements for a change in circumstances.  The respondent contends however that the handing down of the Federal Court decision in Hart v Comcare [2005] FCAFC 16 constituted an event of significance leading to a different interpretation of the exclusionary provisions contained in s.4(1) of the SRC Act. This decision changed the way in which the definition of "injury" should be considered. The respondent submitted that the decision of the Federal Court reflects the way the law in respect to this issue should always have been interpreted and was therefore relevant to the respondent's determination of liability with respect to the applicant's claims. The result being that the applicant was no longer entitled to compensation under the SRC Act and that liability should never have been admitted in the first place.

16.      Hart's case  was an appeal from orders made by a single Judge of the Federal Court allowing an appeal from a decision of the AAT which had set aside a decision of the respondent Comcare and determined liability to pay compensation for an adjustment disorder.  The Full Court dismissed the appeal and accepted the AAT's factual findings that the disease or injury suffered was as a result of the failure to obtain promotions.  The Full Court stated that a proper construction of the definition of "injury" led to the conclusion that if a failure to obtain promotions materially contributed to the condition then it did not amount to an injury within the meaning of the SRC Act.  A failure to obtain to transfer or benefit with connection with employment would lead to the same result. 

17.      The Tribunal accepts the respondent's submission that the decision in Hart's case does not constitute a change of circumstance.  There was no change to the relevant legislation but rather a clarification on the interpretation of the term injury that ought to have been undertaken at the time the section 14 determination was made.

18.      The review officer relied on this interpretation in determining to cease liability for compensation for Ms Hardy.  The issue that arises for an interlocutory determination is whether the decision was validly made pursuant to the provisions of the SRC Act. 

Fairness

19.      It was submitted by the applicant that the reviewable decision which reversed an earlier finding of liability made some eleven years earlier, based on a much more recent interpretation of a legislative provision by the Full Court was unfair, inequitable and contrary to the legislative requirements of s.72 of the SRC Act.  This section requires Comcare to be guided "by equity, good conscience and the substantial merits of the case, without regard to technicalities".  This section goes on to state that Comcare:

"(b)  is not required to conduct a hearing;  and

(c)  is not bound by the rules of evidence".

20. Counsel for the applicant also referred to the provisions of s.33 of the Administrative Appeals Tribunal Act 1975. It is noted that both these legislative provisions refer to the procedure which should guide the decision-maker in its process of decision-making. Section 33 of the AAT Act states that the proceedings shall be conducted with little formality and technicality and with much expedition as the legislation and circumstances permit.  Section 72 of the SRC Act refers to the manner in which claims are to be determined.  Neither has relevance with respect to the outcome of the determination but rather the process adopted in the process of determination. 

21.      The Tribunal is not persuaded that because a claimant views the outcome of a reviewable decision as unfair and unjust that this justifies a conclusion that the decision was invalid or that the decision-maker acted without jurisdiction.  Nor is there any justification for a finding that the decision is invalid due to the time delay between the making of the original decision accepting liability and the reviewable decision which determined to cease liability.

Validity

22.      It is an accepted principal that administrative decisions can be presumed to be valid in the absence of a challenge and the proof of some invalidating feature.  The decision of the Full Court in Collector of Customs (NSW) and Brian Lawlor Automotive Pty Ltd (1979) 24 ALR 304 and the latter decision of Hospital Benefit Fund of Western Australia Inc v Minister for Health, Housing and Community Services (1992) 111 ALR 1 can be relied upon in support of the proposition that the Tribunal is entitled to review an invalid decision and determine whether it has appropriate jurisdiction. Deputy President McMahon referred to these decisions in Re Knoll Australia Pty Ltd & Minister for Health and Aged Care (2000) AATA 926 and cited Tamberlin J who said at pages 256 and 257 in Trajkovski v Telstra Corporation Ltd (1998) 153 ALR 248:

"The approach adopted in these cases lends support to the proposition that the AAT, in the present case, has the competence and authority to determine whether it has jurisdiction. It is not bound to decline jurisdiction simply because the jurisdictional question cannot be described as a "reviewable decision" and it must consider antecedent matters going to its jurisdiction in order to enable it to perform its primary function. See also Aronson and Dyer Judicial Review of Administrative Action, 1996 at 263 ff; A N Hall, "Judicial Power, The Duality of Functions and the Administrative Appeals Tribunal" (1994) 22 FL Rev 13 at 38 ff and J McMillan "Recent Themes in Judicial Review of Federal Executive Action" (1996) 24 FL Rev 347 at 382 ff"

23.      An often quoted paragraph relevant to this issue in the Brian Lawlor decision is that of Bowen CJ at 315:

"In the Administrative Appeals Tribunal Act a wide meaning is given to the word "decision" by S.3(3). In s.25 it appears to me that the word simply refers to a decision in fact made, regardless of whether or not it is a legally effective decision.

...

However, in the ordinary course, it would be reasonably clear from the objective facts under which enactment or in the exercise of which statutory powers an official had purported to act.  The adoption of this view would mean that the Administrative Appeals Tribunal would have jurisdiction to entertain an appeal from a decision in fact made, which purported to be made in the exercise of powers under an enactment.  It could then proceed to determine whether the decision was properly made in fact and in law.  There is nothing unusual in holding an administrative decision which is legally ineffective or void is susceptible of appeal:  see Calvin v Carr (1979) 53 ALJR 471".

24.      Further support for the Tribunal's jurisdictional power to review a purported decision following an internal review is found in the decision of the Full Federal Court Zubair v Minister for Immigration and Multicultural and Indigenous Affairs [2004] 139 FCR 344 where at paragraph 28 the Court stated:

"... There is nothing in Pt 5 of the Act which would suggest that the Tribunal does not have the power or obligation to review a decision properly brought before it where the delegate of the respondent may, or may arguably, have failed to comply with a procedural requirement imposed by the Act, or in some other way may, or may arguably, have committed an error of law either in determining the applicable law or in applying the law. There is no reason why the Act, which provides for a full merits review by the Tribunal of decisions which may be brought to it, should impose upon the Tribunal the task of culling out those decisions which may involve jurisdictional error on the part of the original decision-maker. That would impose an unnecessary additional complexity upon the merits review process".

25.      At paragraph 28 - 29 the Full Court referred to the review powers of the AAT and said:

"That is similar to the review powers of the Administrative Appeals Tribunal (AAT): see AAT Act, s 43. In that context it has been held that the review by the AAT is available even though the decision-maker at first instance may have made a decision which is legally ineffective: see e.g. Clements v Independent Indigenous Advisory Committee [2003] FCAFC 143.

That approach accords with a line of decisions of this Court beginning with Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 24 ALR 307".

26.      The Zubair decision was followed by the Federal Court in Bao v Minister for Immigration and Multicultural and Indigenous Affairs (2005) FCA 270. [At 3] Tamberlin J noted that Zubair was authority for the proposition that:

"Not only is review by the Tribunal available where the delegate has made a decision which is legally ineffective, but also an invalid decision by the delegate can be remedied by the Tribunal giving a full hearing de-novo and the Tribunal can "cure any defect in the delegate's decision in relation to non-compliance with the Migration Act".

27.      A comprehensive review of these decisions was undertaken by Senior Member Mr A Sweidan in the Tribunal decision Teo and Minister for Immigration and Citizenship (2007) AATA 1118. Senior Member Sweidan concluded at paragraph 57:

"The Tribunal has a valid application before it and it is therefore incumbent on the Tribunal to review the merits of that decision.  It should not, to use the language of the Full Court in Zubair, unnecessarily involve itself in culling out those decisions which may involve jurisdictional error".

28.      This approach is consistent with the Tribunal's function to make the correct and preferable decision rather than review the correctness of the decision under review.  The Tribunal hears a matter afresh.  The proceedings are de-novo and the Tribunal stands in the shoes of the original decision-maker exercising the same powers.  It may either set aside a reviewable decision that contains no error or affirm a decision that does contain an error.  This approach is consistent with the reasoning of the Federal Court quoted above at paragraph 26.

29.      The function of the AAT in the review of a decision is to ensure that it complies with the relevant statutory provisions.  The fundamental basis of the AAT's review powers is statutory.  The Tribunal has no inherent power to review the fairness or equity of a decision unless this is expressly conferred upon it by statute.  No such statutory power was referred to by the applicant apart from the procedural requirements outlined above.

30. Issues of equity and fairness are implicit in the doctrine of natural justice. Breach of the rules of natural justice, the procedures that are required by law to be observed in the decision-making process and whether the decision-maker had jurisdiction to make the decision are specifically included in s.5 of the Administrative Decisions (Judicial Review) Act 1977, Applications for Review of Decisions. The Tribunal agrees with the submission of counsel for the respondent that the issues raised by the applicant are more appropriately pursued in the Federal Court under this section. There is no statutory authority vested in the AAT to review decisions on these grounds.

31.      It has been held that the Tribunal in its process of reviewing a decision de-novo can substitute a correct decision for one invalidly made.  Reference is made to Tamberlin J's statement referred to in paragraph 26 above. 

Conclusion

32.      The Tribunal is not persuaded that the decision under review contained any blatant error such as to found a conclusion that the decision is invalid.  The decision was made pursuant to the provisions of s.62 of the SRC Act which authorises a review by Comcare of its own motion.  The Tribunal is not satisfied on the basis of any of the authorities referred to by the applicant and as discussed above that the decision of the review officer was made contrary to or in the absence of a statutory power. 

33.      Further, there is persuasive authority as discussed above for concluding that the Tribunal should not review the legitimacy of the decision under review in the absence of a blatant error.  The Tribunal's procedural process dictates a hearing de-novo with the power to correct a reviewable decision by substituting a new decision following a full merits review of the case.  As the Full Court said in Minister for Immigration and Multicultural and Indigenous Affairs v Ahmed (2005) 143 FCR 314 at paragraph 43:

"We are assisted to the above conclusion by the recognition that the constitution and powers of the Tribunal are appropriate for a body conducting review on the merits rather than making decisions as to compliance with statutory provision.  An application for review to a Tribunal is an application for review on the merits.  Judgment as to the validity of actions by the Minister is for the Courts, not for an administrative body such as the Tribunal".

34.      The Tribunal accordingly determines to dismiss the applicant's interlocutory application which seeks an order that the reviewable decisions are invalid.  The Tribunal will proceed with a merits based review of the decisions pursuant to the applications for review.  

I certify that the 34 preceding paragraphs are a true copy of the reasons for the interlocutory decision herein of Ms A F Cunningham (Senior Member)

Signed:  R Hunt (Administrative Assistant)

Date/s of Hearing  31 August 2007
Date of Interlocutory Decision       2 November 2007
Counsel for the Applicant               Ms L Mackey
Solicitor for the Applicant               Ogilvie Jennings
Counsel for the Respondent          Mr B Morgan
Solicitor for the Respondent         Australian Government Solicitor