Haskard and Repatriation Commission
[2002] AATA 534
•2 July 2002
DECISION AND REASONS FOR DECISION [2002] AATA 534
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N1997/942
VETERANS' APPEALS DIVISION )
Re Howard Haskard
Applicant
And Repatriation Commission
Respondent
DECISION
Tribunal Mr RP Handley, Deputy President Dr JD Campbell, Member
Date2 July 2002
PlaceSydney
Decision The Tribunal sets aside the decision under review and substitutes a new decision that the Applicant should be paid pension at the Special Rate from and including 13 December 1994.
..............................................
RP Handley
Deputy President
CATCHWORDS
VETERANS' REVIEW BOARD – Repatriation Commission – assessment of Special Rate of pension – requirement that decision maker must be "reasonably satisfied" that veteran is incapable of undertaking remunerative work for more than eight hours per week – held that the Applicant be assessed at 90% of General Rate – Applicant to be paid the Special Rate from 26 July 1995.
Veterans' Entitlement Act 1986 ss 5Q(1), 14, 15, 21(A), 23, 23(2), 24, 24(1A), 24(1)(a)(b), (2A) (2A)(c), 120(4)
Grant v Repatriation Commission [1999] FCA 1629
Thomson v Repatriation Commission [2000] FCA 204
REASONS FOR DECISION
2 July 2002 RP Handley JD Campbell
This is an application by Howard Haskard ("the Applicant") for a review of a decision of the Veterans' Review Board ("VRB") made on 8 May 1997 to set aside a decision of the Repatriation Commission ("the Respondent") dated 14 October 1995 and to substitute a decision that a pension assessed at 90% of the General Rate should be paid to the Applicant from 13 December 1994 and at 100% of the General Rate from 26 July 1995.
At the hearing, the Applicant was represented by Craig Colborne, of Counsel, and the Respondent was represented by Susie Breuer, Solicitor, of the Department of Veterans' Affairs. The evidence before the Tribunal comprised the documents produced pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 ("the T Documents") together with the documents tendered by the parties. Oral evidence was given by the Applicant.
BACKGROUNDThe Applicant, Mr Haskard, was born on 12 December 1927 and is aged 74. He served as a seaman in the Royal Australian Naval Reserve from 16 August 1945 to 8 December 1947. After his discharge from the Navy, Mr Haskard worked for many years as a valuer in the Commonwealth Public Service. In about 1968, he completed the Real Estate Valuers' course conducted by the Commonwealth Institute of Valuers and, in 1970, was admitted as an Associate of that Institute. On 24 October 1983, at the age of 55, Mr Haskard resigned from the Commonwealth Public Service because of ill health.
In February 1984, Mr Haskard went into partnership with his son, Christopher Haskard, in the purchase of a real estate agency at Narraweena, trading as Flagstaff Real Estate ("Flagstaff"). The Applicant financed the purchase of the business. In retrospect, the Applicant said he wished he had never gone into the business because it was not profitable. Christopher Haskard, who was a licensed real estate agent, looked after the real estate sales side of the business while the Applicant undertook property valuations. In 1987, the Applicant obtained a licence as a real estate agent. At about that time, he also started working from home as a valuer. In September 1989, Christopher Haskard sold the real estate agency because of marital problems. The purchaser of the business, Corifin Pty Ltd ("Corifin"), retained the Applicant's services because of his real estate licence, and the Applicant became a director of that company. The Applicant worked for the business on three half days a week for which he was paid $300. He also continued to undertake property valuations on his own behalf. In December 1990, the Applicant resigned from Corifin and from then on worked as a real estate valuer exclusively from home. Most of the valuations he was asked to undertake were at the request of his other son, Gregory Haskard, a Solicitor, who was aware of the Applicant's physical limitations as a result of his health. Since 1991, the Applicant has undertaken about six valuations a year.
On 13 May 1995, the Applicant lodged a claim for a disability pension with the Respondent. The following of the Applicant's disabilities have been accepted as war-caused: injury right foot, chronic airflow limitation, ischaemic heart disease, bilateral sensori-neural hearing loss, and solar skin damage. The Applicant's hypertension and dental caries have not been accepted as war-caused. On 14 October 1995, a delegate of the Respondent decided that a disability pension would be paid to the Applicant at 70% of the General Rate with effect from 13 December 1994. The Applicant sought a review of this decision by the VRB which, on 8 May 1997, decided to set aside the Respondent's decision and substitute a new decision that the Applicant's disability pension be assessed at 90% of the General Rate from 13 December 1994 and at 100% of the General Rate from 26 July 1995. On 10 July 1997, the Applicant sought a review of this decision by the Tribunal.
APPLICABLE LAWPursuant to s 120(4) of the Veterans' Entitlements Act 1986 ("the Act"), the standard of proof to be applied in deciding relevant matters in assessing the rate of pension payable is that of the decision-maker's "reasonable satisfaction".
The Applicant claims that he is entitled to the payment of pension at the Special Rate in accordance with s 24 of the Act or, alternatively, payment at the Intermediate Rate in accordance with s 23. Pursuant to s 24(2A), in order to be eligible for payment of a pension at the Special Rate, an applicant must fulfil all the criteria set out in sub-paragraphs (a)-(h) of the subsection:
(2A) This section applies to a veteran if:
(a) the veteran has made a claim under section 14 for a pension, or an application under section 15 for an increase in the rate of the pension that he or she is receiving; and
(b) the veteran had turned 65 before the claim or application was made; and
(c) paragraphs (1)(a) and (1)(b) apply to the veteran; and
(d) the veteran is, because of incapacity from war-caused injury or war-caused disease or both, alone, prevented from continuing to undertake the remunerative work ( last paid work ) that the veteran was last undertaking before he or she made the claim or application; and
(e) because the veteran is so prevented from undertaking his or her last paid work, the veteran is suffering a loss of salary or wages, or of earnings on his or her own account, that he or she would not be suffering if he or she were free from that incapacity; and
(f) the veteran was undertaking his or her last paid work after the veteran had turned 65; and
(g) when the veteran stopped undertaking his or her last paid work, the veteran:
(i) if he or she was then working as an employee of another person—had been working for that person, or for that person and any predecessor or predecessors of that person; or
(ii) if he or she was then working on his or her own account in any profession, trade, employment, vocation or calling—had been so working in that profession, trade, employment, vocation or calling;
(h) section 25 does not apply to the veteran.
The requirements of s 24(1) paragraphs (a) and (b), referred to in s 24(2A)(c), are as follows:
(a) either:
(i) the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be at least 70% or has been so determined by a determination that is in force; or
(ii) the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and
(b) the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and
Pursuant to s 23(3A), in order to be eligible for payment of pension at the Intermediate Rate, the main difference from Special Rate is that the veteran need only be "incapable of undertaking remunerative work otherwise than on a part-time basis or intermittently" as more particularly described in s 23(2).
The expression "remunerative work" is non-exclusively defined by s 5Q(1) as including "any remunerative activity".
THE APPLICANT'S EVIDENCEThe Applicant said he worked for the Commonwealth Government until 1983, when, at the age of 55, he retired due to ill health. He was experiencing angina and shortness of breath, in particular, in climbing the stairs at Wynyard Station and on walking to his office at Chifley Square. After he had retired, the Applicant's son, Christopher Haskard, suggested that they should go into partnership in the purchase of a real estate agency at Narraweena. His son would run the sales side of the business while the Applicant undertook real estate valuations. The Applicant said he became a part owner of this business and not an employee. When he was present in the office, he would answer the phone and deal with occasional enquiries, but he sought to avoid being involved in sales. He also looked after the business trust account. The Applicant and his son agreed that the Applicant could keep any fees from valuations, which he undertook, which were to be regarded as his private business. He was not otherwise to receive any payment for the work he undertook for Flagstaff. However, the Applicant said that because Flagstaff was losing money, all the fees he earned from valuations he endorsed over to the business, in order to try and keep it afloat.
By about 1987, when the Applicant obtained a licence as a real estate agent, he had become disillusioned with his financing of the business and started working from home as a valuer. Initially, in 1984, the Applicant was undertaking about three valuations a fortnight. After 1985, this gradually declined to three valuations a month when solicitors and accountants for whom he undertook valuations in the Manly/Warringah area realised that he was unable to do some valuations because of his physical limitations. In September 1989, the Applicant's son sold the business because of marital problems and the Applicant allowed him to keep the proceeds of sale. The purchaser of the business, Corifin, did not have a real estate licence and retained him on a part-time basis, as the sole director of Corifin, so that it could obtain the benefit of his licence. He worked about three mornings a week for Corifin for which he was paid $300 per week on which he had to pay tax. While working for Corifin, the Applicant continued to undertake valuations on his own behalf working from home. Finally, in December 1990, the Applicant resigned as a director of Corifin because he did not like the way they operated. He said Corifin never provided him with a Group Certificate.
Since December 1990, the Applicant said he has worked exclusively from home and has, on average, undertaken about six valuations a year. Each valuation takes six to seven hours spread over two to three days involving: (1) inspecting the property, (2) writing up a description, (3) researching sales evidence, and (4) going to look at the sales evidence by way of curbside inspections.
The Applicant said he has done four valuations so far this calendar year, most recently four weeks ago of an easement in front of a property. Instructions for these valuations come exclusively through his son, Gregory Haskard, who is a solicitor and aware of the Applicant's physical limitations. Previously, the Applicant obtained instructions through other contacts but they have now died. The Applicant said if he was fit, he could undertake and would be willing to undertake about six valuations a week, which he would do over about three days. However, to attract this volume of business, he would need to advertise. He said he believed that such a volume of work would be available. When he started undertaking valuations in 1984, he had no problem attracting work. He has a comprehensive interest in real estate and has valued all types of property in NSW.
The Applicant is a member of the Australian Property Institute, previously the Commonwealth Institute of Valuers, and he is a former member of the Real Estate Institute. He still maintains his license as a real estate agent and property valuer in New South Wales. He keeps up-to-date with information about sales by reading the newspapers and professional information which takes him from two and a half to three hours per week. The Applicant said, in recent years, he has consistently undertaken about six valuations a year. Generally, these are fairly simple valuations which do not involve any physical challenges. Thus, in a week when he undertakes a valuation, the Applicant would typically work a further six to seven hours in undertaking the valuation, spread over a number of days.
The Applicant was referred to a summary of his earnings for the financial years ending 30 June 1993 through to 30 June 2000 (R2, Schedule A). The summary shows the Applicant's income from valuation fees being in the range of $600 - $800 in most years with the exception of the year ending 30 June 2000 when his fees were $1,450. The Applicant's expenses in most of those years accounted for the majority of his fees. He said that these expenses were in relation to costs associated with his motor vehicle, with his maintaining his real estate license and membership of the Australian Property Institute, and with depreciation of his computer. His fees in the financial year ending 30 June 2000 were boosted by a fee he received for acting as an expert witness in a court case.
SUBMISSIONS
RespondentMs Breuer, for the Respondent, suggested that s 24(2A) of the Act probably did not contemplate this sort of case because of the infrequency of the work undertaken by the Applicant involving an average of six valuations per annum over a period of ten years. She questioned whether such irregular work could be classified as remunerative work for the purposes of s 24(2A)(d). Ms Breuer also questioned whether the subsection was applicable to the Applicant given that he has continued to undertaken infrequent valuations since 1984 and has not been prevented from doing what he previously did. With regard to subsection (2A)(g), Ms Breuer noted that the Applicant was self-employed between 1984 and September 1989, but did not receive any remuneration because he endorsed his fees over to Flagstaff. She therefore questioned whether he was undertaking remunerative activity. Then, from 1990 onwards, the Applicant worked exclusively for himself running his business from home. Since 1990, he has continued working consistently at what he has always done: he has not been prevented from undertaking his last paid work.
With regard to eligibility for the Intermediate Rate of pension pursuant to s 23, Ms Breuer noted that this permits work on a part-time basis. However, in the Applicant's case, the evidence does not support a finding that the Applicant has a capacity for work on such a basis.
ApplicantMr Colborne, for the Applicant, submitted that the Tribunal should be satisfied that the amount of work undertaken by the Applicant has clearly diminished due to the physical limitations imposed by his ill health. The number of valuations he has undertaken has dropped from six per month in 1984 to three per month in 1985, when solicitors and accountants in the Manly/Warringah area became aware of his limitations, and to approximately six valuations per year between 1990 and the present. Mr Colborne submitted that subsection (2A)(d) does not require a complete cessation of work. The Applicant says the wording of the paragraph must be construed in the light of other provisions which, in the case of the Special Rate, anticipate a person possibly being able to work up to eight hours a week, and, in the case of the Intermediate Rate, anticipate a person being able to work on a part-time basis.
Moreover, the decision in Grant v Repatriation Commission [1999] FCA 1629 at paragraph 7, suggests that a veteran remains eligible for payment of a pension at the Special Rate until, "inter alia", the veteran is undertaking or is capable of undertaking remunerative work for periods aggregating more than eight hours per week (s 24A(1)(c)). Mr Colborne submitted that the construction of ss 23 and 24 of the Act suggests implicitly that the sections contemplate a partial cessation of work.
In the Applicant's case, in a week in which he undertakes a valuation, he typically works six or seven hours during the week spread over a number of days. He also spends two and a half to three hours reading the newspapers and other professional information in order to keep himself-up-to-date. However, Mr Colborne submitted that such reading does not specifically constitute remunerative work being of the character of general background reading only. With regard to the point raised by the Respondent as to the Applicant's having endorsed fees earned from his valuations in the period 1984 to 1989 over to Flagstaff, Mr Colborne submitted that the fact that the Applicant paid these fees to Flagstaff is irrelevant. What is important is that the fees were generated by the Applicant's work.
Mr Colborne noted that in the decision of Thomson v Repatriation Commission [2000] FCA 204 at paragraphs 10 – 12, the Full Federal Court emphasised that section 24(2A)(g) is concerned with the capacity in which the last paid work was undertaken and whether the veteran continued to undertake work in that capacity continuously for a ten year period. In the Applicant's case, he has worked continuously for a period of at least ten years and has lost remuneration as a result of his accepted disabilities by being able to undertake significantly less work than he would have been able to undertake had he not had such disabilities.
APPLICATION OF THE LAW AND FINDINGSBased on the Applicant's evidence, the Tribunal finds that between February 1984 and September 1989, he was in partnership with and the co-owner of a real estate business with his son Christopher Haskard. During this period, the Applicant was undertaking valuations on his own account but endorsed the fees over to Flagstaff in order to assist in keeping the business afloat. After Christopher Haskard sold the business in September 1989, the Applicant worked until December 1990 as the sole director of Corifin, the purchaser of the business, to enable Corifin to have the benefit of his real estate licence. During this period, the Applicant was also paid $300 per week to attend the business on three mornings a week including the maintenance of its trust account. During this period, the Applicant was able to maintain undertaking valuations on his own account working from home. After his resignation as a director of Corifin in December 1990, the Applicant continued to undertaken property valuations working from home.
When the Applicant first undertook property valuations in 1984, he was undertaking approximately six per month. However, from 1985, this gradually declined to about three per month and, between 1991 and the present, he has undertaken about six valuations a year. The Tribunal finds that each valuation requires six to seven hours work spread over a number of days. In addition to this, the Applicant undertakes two and a half to three hours reading per week of relevant background material, including both newspaper reports as to property sales and other relevant professional information. The Applicant is not remunerated for such background reading which he can undertake at his leisure, at home.
To be eligible for a Special Rate of pension, a veteran must comply with the requirements of s 24(2A) of the Act. The Tribunal will deal with each of the paragraphs of subsection (2A) in turn. With regard to paragraphs (a) and (b), there is no dispute that the Applicant made a claim for a pension after turning 65. With regard to paragraph (c), which refers the decision-maker to s 24(1)(a) and (b), there is also no dispute that the Applicant's degree of incapacity from war-caused injury or war-caused disease has been assessed as at least 70% (s 24(1)(a)). The Respondent accepts that the Applicant is totally and permanently incapacitated such as to render him incapable of undertaking remunerative work for periods aggregating more than eight hours per week (s 24)(1)(b)). Based on the evidence at the hearing, the Tribunal finds that while the Applicant is capable of undertaking a property valuation requiring six to seven hours work spread over a number of days in a week, he is not capable of undertaking remunerative work for periods aggregating more than eight hours per week. The Tribunal does not consider the two and a half to three hours a week that the Applicant spends on reading background material at his leisure at home as being remunerative work.
With regard to paragraph (d) of subsection (2A), the last paid work which the Applicant undertook before making his claim for pension was that of a property valuer. He undertook such work on his own account and not as an employee. The Tribunal construes the wording of paragraph (d) that the veteran is "prevented from continuing to undertake the remunerative work" as meaning that the veteran was unable to continue such work for periods aggregating more than eight hours per week. In the Tribunal's view, the wording of paragraph (d) must be interpreted in the context of other provisions in the section and, in particular, the requirement in s 24(1)(b) that to be qualified for the payment of pension at the Special Rate, the veteran must be incapable of undertaking remunerative work for periods aggregating more than eight hours per week (s 24(1)(b)). Such a common sense interpretation is implicit from the arrangement of s 24 and follows a similar arrangement in s 23 in respect of eligibility for pension at the Intermediate Rate.
With regard to paragraph (e), the Tribunal finds that the Applicant has been prevented from undertaking his last paid work and, thereby, has suffered a loss of earnings, which he would not have suffered had he been free of the incapacity. With regard to paragraph (f), there is no dispute that the Applicant was undertaking his last paid work after turning 65 years of age. With regard to paragraph (g), the relevant sub-paragraph is (ii) in so far as the Applicant was working on his own account in his profession as a property valuer. The Tribunal finds, following the Full Federal Court decision in Thomson (supra), that the Applicant worked for a continuous period of at least ten years that began before he turned 65 years of age, namely from 1984, when he financed and entered into a partnership with his son, Christopher Haskard, in running a real estate business. The Tribunal notes that the Applicant has maintained his membership of the relevant professional institutes since that time and continues to undertake about six valuations a year subject to the constraints imposed by his health-derived physical limitations. In particular, the Tribunal notes that even during the period 1989 to December 1990 when the Applicant was the sole director of Corifin, he continued to conduct valuations on his own account. Finally, with regard to paragraph (h), the Tribunal finds that s 25 does not apply to Mr Haskard.
In conclusion, having satisfied the requirements of s 24(2A), Mr Haskard is eligible for payment of pension at the Special Rate. With regard to the date of effect, the Tribunal determines that this should be 13 December 1994, since at that date the Applicant's degree of incapacity was at least 70% as required by s 24(2A)(c) referring to s 24(1)(a)(i).
I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of Mr R P Handley, Deputy President and Dr JD Campbell, Member.
Signed: .....................................................................................
AssociateDate of Hearing 3 June 2002
Date of Decision 2 July 2002
Representative for the Applicant Mr C Colborne, Counsel
Representative for the Respondent Ms S Breuer, Solicitor
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