House and Defence Force Retirement and Death Benefits Authority

[2004] AATA 667

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 667

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2002/175

GENERAL ADMINISTRATIVE DIVISION		)
Re		DAVID HOUSE

Applicant

And DEFENCE FORCE RETIREMENT
AND DEATH BENEFITS AUTHORITY

Respondent

DECISION

Tribunal Ms J Cowdroy, Member

Date29 June 2004 

PlaceBrisbane

Decision The Tribunal affirms the decision under review. 

...................[Sgd]......................

J Cowdroy
  Member

CATCHWORDS

DEFENCE FORCES – retirement and death benefits – invalidity benefit - alcoholism and alcoholic liver disease - classification – applicant able to undertake employment as a driver, mobile plant operator, labourer, storeman, mining and construction labourer and security officer – degree of incapacity from civil employment is 20% - reclassification to Class C – decision affirmed

Defence Force Retirement and Death Benefits Act 1973 ss 26, 30, 34(1A), 34(1B)

Freeman v Defence Force Retirement and Death Benefits Authority (1985) 5 AAR 156
Defence Force Retirement and Death Benefits Authority v House (1989) 91 ALR 286

Re McGovern and Defence Force Retirement and Death Benefits Authority (1988) 16 ALD 791

REASONS FOR DECISION

29 June 2004  Ms J Cowdroy, Member     

1. The applicant requested a review of the decision of the respondent dated 3 July 2001, which was confirmed by the respondent on 13 February 2002. The primary decision determined, under subsection 34(1A) sub-paragraphs (a) (b) and (c) of the Defence Force Retirement and Death Benefits Act 1973 (the Act), that:

(a)the kinds of employment which a person with the applicant’s vocational, trade and professional skills, qualifications and experience might reasonably undertake were driver, mobile plant operator, labourer, storeman, mining and construction labourer and security officer;

(b)“alcoholism” constituted the applicant’s prescribed physical or mental impairments;

(c)the applicant’s degree of incapacity to undertake the identified kinds of civil employment was 20 per cent; and

(d) accordingly, the applicant was reclassified Class C pursuant to section 30 of the Act from 10 August 2001.

Hearing

2. At the hearing on 11 July 2003, the applicant was represented by Mr N Payne and Mr B Dubé appeared for the respondent. The T documents, lodged in the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act1975, were before the Tribunal as Exhibit 1, and the following further documentation was tendered:

Exhibit 2   Transcript of hearing on 15 and 16 May 2000

Exhibit 3   Transcript of transcript on 14 and 15 October 1996

Exhibit 4Clinical notes and report of Dr Hargreaves dated 25 February 2002

Exhibit 5   Report of Dr Reddan dated 15 January 2003

Exhibit 6   Pathology reports dated 28 November 2002

3.      Oral evidence was given by the applicant and psychiatrist, Dr J Hargreaves.  For the respondent, Dr P Stevenson, consultant physician and Dr J Reddan, psychiatrist gave evidence.   

Background

4.      The decision under review was preceded by a decision of the Administrative Appeals Tribunal dated 8 May 2001 which varied the decision under review and classified the applicant at 30 per cent (Class B) with effect from 22 June 1999. The decision currently under review reclassified the applicant as 20 per cent (Class C) with effect from 10 August 2001.  The applicant is dissatisfied with the diminution in his classification.

The Legislation 

5. Section 30 of the Act relates to the classification of members as to incapacity, upon becoming entitled to invalidity benefit under section 26 of the Act. Section 30(1) requires the Authority to determine the member’s percentage of incapacity in relation to civil employment and shall classify the member according to the percentage of incapacity as follows:

Percentage of Incapacity  Class

60% or more   A 

30% or more but less than 60%                  B

Less than 30%   C

6.      Subsection 30(2) provides:

“(2)     In determining, for the purposes of subsection (1), the percentage of incapacity in relation to civil employment of a member of the scheme, the Authority shall have regard to the following matters only:

(a)the vocational, trade and professional skills, qualifications and experience of the member;

(b)the kinds of civil employment which a person with the skills, qualifications and experience referred to in paragraph (a) might reasonably undertake;

(c)the degree to which the physical or mental impairment of the member that caused the invalidity or physical or mental incapacity because of which he or she was retired has or had diminished the capacity of the member to undertake the kinds of civil employment referred to in paragraph (b);

(d)such other matters (if any) as are prescribed for the purposes of this subsection.”

7.      Section 34(1) of the Act provides:

“The Authority may, from time to time, if it is satisfied that the percentage of incapacity in relation to civil employment of a recipient member in receipt of invalidity pay is such that the classification of the member should be altered, reclassify him in the appropriate classification set out in section 30 according to the percentage of his incapacity in relation to civil employment.”

8. The factors to be taken into account in such a review are set out in section 34(1A) being in the same terms as section 30(2) except that paragraph (c) reads:

“the degree to which any physical or mental impairment of the recipient member, being a prescribed physical or mental impairment, has diminished the capacity of the recipient member to undertake the kinds of civil employment referred to in paragraph (b).”

9. Section 34(1B) states:

“(1B)    In subsection (1A), prescribed physical or mental impairment, in relation to a recipient member … means:

(a)a physical or mental impairment of the member that was the cause, or one of the causes, of the invalidity or physical or mental incapacity by reason of which the member was retired, whether or not that impairment changed, for better or worse, since that retirement; or

(b)any other physical or mental impairment of the member causally connected with a physical or mental impairment referred to in paragraph (a).

(2)       Where a recipient member is reclassified under this section, the Authority shall specify the date from which the reclassification has effect, and, on and after that date, the recipient member shall, for the purposes of this Part, be deemed to be classified under section 30 accordingly.”

10.     In Freeman v Defence Force Retirement and Death Benefits Authority (1985) 5AAR 156 at 160, Sheppard and Sweeney JJ said:

"… the definition takes one back to the physical or mental impairment that was the cause of the original invalidity or physical or mental incapacity by reason of which the member was retired.  It follows that the Authority is always obliged to look at the current capacity of a member and reach a conclusion on the degree to which the original physical or mental impairment which caused his incapacity has diminished his capacity for civil employment.”

Evidence

11.     At the hearing, the respondent conceded that the impairments by reason of which the applicant was retired were alcoholism and alcoholic liver disease and this aspect is not in issue.

12.     The applicant had sought review of this decision because he considered his impairment had increased rather than diminished.  Such diminishment is said to have been demonstrated by the fact that the applicant ceased work on the advice of his psychiatrist. It was considered to be incongruous that two months before the Authority made the decision which is the subject of this review, the Administrative Appeals Tribunal (the AAT) had determined the applicant's impairment warranted a classification of 30 per cent. 

13.     The applicant maintained that that since the previous July he had consumed large quantities of alcohol and that much of his income had been expended on a combination of alcohol and poker machines.  The day following his most recent consultation with Dr Reddan, he had separated from his wife which, he said, was attributable to her reducing her alcohol levels, whilst he did not. 

14.     He had been admitted to hospital in a suicidal state for about 3-4 weeks.  After being discharged from hospital he had resumed his usual drinking pattern, the quantities of which depended on the availability of money at any given time. 

15.     He left work in February 2001 upon advice from his treating psychiatrist, Dr Hargreaves. Because he had now ceased work, he considered he should be reclassified as Class A. He left work because he was unable to control his feelings of anger and he considered he was likely to be sacked, although he had been working with that employer, Ramset, since November 1989.

16.     He acknowledged that in late 2000, there was a suggestion that the firm was re-locating, and the new location would require further travel to work, which he was not happy about. He refuted that this was one of the reasons he ceased work, stating: “I wanted to work until I died". He also acknowledged that he was not optimistic about a cordial work environment in the new location, as the manager at the new location was “difficult”.

17.     He consulted Dr Hargreaves shortly before he resigned and he discussed cessation of work with him.  He knew it was likely that if he ceased work, he would receive the totally permanently incapacitated (TPI) pension from the Department of Veterans’ Affairs.  However, Dr Hargreaves warned him not to quit his job until he had gone through the proper channels and consulted an advocate. He was subsequently granted TPI pension.

18.     Since he has received TPI pension and had received his long service leave from Ramset, he has had more disposable income and had been consuming considerably more alcohol.  He acknowledged that in April 2001 he had told Dr Hargreaves he drank only on weekends.

19.     He believed that he would be placed on Class A pension based on Dr Hargreaves’ report and the fact that he was not working.  He had carried out volunteer work with Meals on Wheels for a period after receiving TPI, and he ceased that activity after he separated from his wife.   

Medical Evidence

20.     Dr J Hargreaves, psychiatrist, had been treating the applicant since 29 January 1998, which involved about 34 consultations.  In January 2001, he had written a letter advising that the applicant was incapacitated for all work due to his war caused disabilities. That letter was instrumental in the applicant obtaining pension at the TPI rate.

21.     He considers that the applicant suffers from alcoholism and personality disorder.  He believed that alcoholism can enhance personality disorder. He was aware that another psychiatrist had diagnosed post traumatic stress disorder and assumed that to be a correct diagnosis. He had read the reports of Drs Reddan and Stevenson and the only major inconsistency between the opinions expressed in those reports and his own opinion was in relation to the presence of post traumatic stress disorder (PTSD).  

22.     He considered that personality disorder, PTSD and alcoholism were interrelated, to some degree. He acknowledged that in the past ten years, the applicant had been charged once with a drink driving offence and whilst that might cast some doubts on the applicant's reported level of drinking, it could also be explained by sheer good fortune at not having been the subject of police interest in his driving activities.  

23.     He acknowledged that over recent years, the applicant had reported that he consumed most of his alcohol on weekends, rather than during the week.  His clinical notes reveal that, in June 1998, the applicant reported drinking one carton during the week and three cartons on the weekends, whereas, on 9 April 2001, he reported drinking 24 standard drinks on a typical weekend and abstinence during the week.

24.     He was aware that Drs Reddan and Stevenson based their opinions, in part, on the results of pathology tests, and in particular, a test known as carbohydrate deficient transferrin (CDT). The tests did not support the presence of excessive alcohol intake.  However, he queried the reliability of the tests.  He was aware that Dr Stevenson had commented that if the applicant had consumed the amount of alcohol in the past 25 years that he had reported, he would more than likely be suffering from liver disease, which is not demonstrated.  However, Dr Hargreaves was of the view that elevated enzymes were one key feature, and it was not necessarily an exhaustive indicator. He considered it possible that Mr House was one of those fortunate people who were able to consume large amounts of alcohol without demonstrating clinical deterioration.

25.     He acknowledged that the applicant’s employment at Ramset between 1989 and 2001, at which time he was reported to be consuming large quantities of alcohol on the weekend, but lesser amounts or nil during the week, indicated that the applicant was able to control his alcohol consumption.  He also agreed that the accumulation of sick leave in that period indicated that the applicant was capable of reporting to work punctually and regularly.

26.     His notes record that the applicant reported feeling better in February and April 2001 following cessation of work, that he was drinking less and getting more enjoyment from life.  However, as time progressed he reported a sense of boredom due to lack of activity and he became depressed and disappointed at the result of the AAT decision which maintained him at a Class B pension. 

27.     He had written a letter indicating that the applicant ceased work because he considered his rehabilitation prospects would be enhanced if he did not have to concern himself about employment.  He referred in his report of 19 October 2001 to the negative effects of alcohol dependence on the applicant's mood and personality.  In that letter, he stated that whilst the applicant is convinced that his alcoholism has been the major factor which has prevented him from progressing further in any career, personality changes and mood instability have no doubt been significant factors in the applicant’s presentation.  Combining the alcoholism and the personality changes, the overall diminution of capacity for the positions which the Authority had determined were the kinds of jobs he might reasonably undertake would be “large".

28.     In his report of 31 March 1999, Dr Hargreaves had alluded to the possibility of subtle changes signifying frontal lobe damage, which are not detectable, even on CAT scan.  However, despite that belief, he could not say that the applicant exhibited any gross signs of frontal lobe damage. 

29.     In a report dated 25 February 2002, Dr Hargreaves reported that the applicant had been referred to the Toowong Private Hospital Alcohol Management Programme and that he had subsequently been enrolled in the Combat-Related PTSD Treatment and Rehabilitation Day Programme. 

30.     Dr P Stevenson, a consultant physician since 1972, had examined the applicant on several occasions since April 1995 and had prepared a number of reports, the first on 18 April 1995.  He noted that liver function tests throughout the period had been repeatedly normal and he could find no clinical or biochemical evidence that alcohol liver disease is contributing to any impairment. He makes the comment at page 8 of that report that Mr House is "apparently a not totally uncontrollable drinker".  

31.     In his report dated 3 May 1999, Dr Stevenson comments that the applicant's conversation was not suggestive of a substantial alcohol induced cognitive impairment.  His reports of 24 September 1999 and 4 November 1999 assess the applicant’s impairment in the order of moderate, 40 per cent and 30 per cent respectively. However, he made the comment that upon review, it should be possible to move to a figure based on purely objective criteria, as the figure of 30 per cent was based on a generous averaging between objective criteria of 10 per cent and the subjective criteria of 27.5 per cent. 

32.     In his report dated 7 May 2001, Mr House reported to him that he was drinking less.  He performed liver function tests that produced normal results.  He had also ordered CDT tests, which are a more sensitive and specific marker of recent heavy alcohol excess.  However, the manufacturer had recalled the kits prior to the test being performed. He made the comment that Mr House should be given the benefit of the doubt, and assessed him as having an overall level of moderate impairment. However, if the CDT tests demonstrated results which were not in the level indicating alcohol excess in the past two weeks, then the applicant’s level of incapacity should be judged as small.

33.     He acknowledged that some persons have a greater ability to tolerate more alcohol and that individual variation in test results is to be expected.  However, in 1975 the applicant had liver enlargement and therefore had not shown himself to be biologically resilient.  It was therefore difficult to reconcile his reports of alcohol consumption in the 1990s up to the present time.  When he first examined the applicant in 1995, he reported he was drinking on weekends as well as during the week.   

34.     After four years of consultations, he formed the view that he could not place much weight on his reports of alcohol consumption as they revealed "increasing inconsistencies". As time went on, he found his suspension of disbelief more difficult.  The results of the CDT tests conducted by Dr Reddan and the absence of neurological problems gave additional weight to his opinion that the applicant was overestimating his alcohol consumption.  

35.     In his report (T44-288), Dr Stevenson states relevantly:

“As I have discussed in previous reports, there seems then good objective grounds to consider that Mr House’s description of his own alcoholic intake has been excessive and the range of reasonable possibility would seem to be that he either remains at the previous estimated level or that he is drinking less with time, in which case the categorisation should go to Small, which latter categorisation seems to better reflect the objective evidence of the case.”

36.     Dr Reddan, psychiatrist, had provided a number of reports over the years in regard to the status of the applicant's mental health. In 1997, cognitive testing revealed a flattened learning curve, but no flatter than one would expect.  She opined that this result could be produced by a number of factors, including lack of concentration, poor memory, lack of attention and simply not listening.  She was aware of a neuropsychological assessment carried out by Maureen Field, neuropsychologist, in 1992 which Ms Field considered was suggestive of frontal lobe deficit.

37.     Dr Reddan had seen no evidence of frontal lobe deficit in Mr House. Whilst Ms Field considered that a result in the 16th percentile demonstrated a mild deficit, Dr Reddan regarded that result as low average, which is line with current thinking.  In 1992, general opinion was that it was indicative of mild deficit.  

38.     She believed that the applicant's cooperation with the testing had not been tested, which was a particularly significant factor. She stated that many of the results which Ms Field produced were not remarkable. At the very worse, they demonstrated a mild deficit in some areas. His demeanour and presentation has not suggested any cognitive effects.  She pointed out that he represented himself before the AAT in 2000, which is a difficult task.  She considered that Mr House had an ability to think on his feet, he was able to control his responses and demonstrated a superior performance when compared to most self represented applicants.

39.     Dr Reddan conducted blood tests on two occasions.  She considered that if the applicant had been formerly diagnosed with alcohol liver disease, it was unusual that it had not progressed and that he had not become unwell.  However, her opinion was not based solely on the blood tests.    

40.     She had diagnosed the applicant with a personality disorder and considered that persons with that condition tend to be more prone to alcohol abuse. If personality disorder is present, alcohol use keeps the patient at an early level of development and the personality disorder interferes with the patient’s ability to benefit from treatment for alcoholism.

41.     Objective indications of alcohol abuse in employment would be absenteeism due to sickness, falls, fights, arriving late repeatedly, absenting the work environment to drink.  Mr House’s record of accrued sick leave does not fit comfortably within these criteria.  She believed that the applicant exhibited a degree of control over his alcohol consumption, which is not suggestive of significant incapacity.

Consideration

42.     The Tribunal shares the view of the delegate that the incapacity by reason of which the applicant was retired was the affects of alcoholism.  It is not in dispute that the applicant's prescribed physical or mental impairments are alcoholism and alcoholic liver disease. It finds that there is, within the relevant time period to which this Tribunal must have regard, no evidence of any impairment arising from alcoholic liver disease. Therefore, the Tribunal has to consider the effects of alcoholism, which has been described in terms such as alcohol abuse and alcohol dependence.   

43.     The Tribunal accepts and agrees with the submissions of counsel for the respondent, with which the applicant did not take issue, as to the kinds of civil employment which a person with the applicant's skills, qualification and experience might reasonably undertake, namely driver, mobile plant operator, labourer, store person, mining and construction labourer and security officer.

44. It is next necessary to determine the degree of diminishment pursuant to section 34(1A) of the Act. The Tribunal was mindful of the principles regarding the interpretation of that subsection in Defence Force Retirementand Death Benefits Authority v House (1989) 91 ALR 286, when the Federal Court stated that the Authority (and consequently this Tribunal), must have regard only to the matters set out in sections 30(2) and 34(1A) and no other matters.

45.     In Re McGovern and Defence Force Retirement and Death Benefit Authority (1988) 16 ALD 791 at 792, the Tribunal summarised the matters which may not be taken into account:

“The only matters which it may take into account in determining the percentage of incapacity are those referred to in the provisions.  Accordingly, the Tribunal cannot take into account the ageing process, a depressed labour market, a state of unemployment, the shortage of employment for those who might engage in a particular occupation, circumstances foreseeable only in the long term unless made appropriate and prevention of continuance in non-civil employment.”

46.     The Tribunal finds that any degree of cognitive deficit is of a very mild nature.  The only evidence on this aspect is that of psychologist, Maureen Field, whose report was prepared in 1992 and should therefore he treated with some caution as it does not purport to cover the period under consideration.  The Tribunal also notes the comments of Dr Reddan as to the usefulness of this report. 

47.     Neither Drs Hargreaves, Stevenson nor Reddan pointed to any cognitive deficit.  Although Dr Hargreaves considered that it was likely to be present, his opinion on this issue appeared to be primarily based on the applicant’s report of his alcohol consumption, which the Tribunal finds to be based on self interest and likely to be exaggerated.  The fact that excessive alcohol consumption was not revealed on clinical testing supports this view.

48.     The applicant relied substantially on the reports of Dr Hargreaves who assessed the applicant’s impairment as “large” for one type of employment and “moderate” for all others.

49.     The evidence demonstrates that the applicant is capable of a reasonable degree of control over his alcohol consumption. He consumes alcohol, to a great degree, to relieve boredom and depression.  In the Tribunal’s view,  Dr Hargreaves did not satisfactorily and convincingly explain the lack of correlation between the levels of alcohol consumption reported to him and the lack of clinical evidence that drinking at this level would produce. His assessment is based almost entirely on the subjective reporting of the applicant in this regard. 

50.     The overall impression this Tribunal gained of the applicant was of a person who is heavily compensation orientated, and is well versed with providing responses which best serve his interests.  He explained to Dr Stevenson in considerable detail the benefits of receiving a Class A pension.  He showed him a letter from Ms Field to suggest he was unemployable and he has reiterated his perception that he has been under compensated for many years. Dr Stevenson refers to the applicant having an incentive to maintain his alcoholism as, by doing so, he gains positive reinforcement by receiving more compensation. There are also discussions recorded in Dr Hargreaves’ clinical notes regarding this aspect.  

51.     In assessing the degree of impairment in relation to prescribed impairments, the Tribunal is not influenced by the fact that the applicant ceased work.  In fact, it is quite an irrelevant consideration. The Tribunal notes that Mr House was granted TPI on the basis of impairments including post traumatic stress disorder and organic personality disorder. Such conditions are not properly to be taken into account in this jurisdiction. The decision that the applicant is totally and permanently incapacitated for all forms of work was made under different, and more beneficial, legislation.

52.     Further, the Tribunal notes that Dr Hargreaves has referred to the effects of personality in providing his assessment for this Tribunal. The Tribunal recognises the complex interaction of alcoholism and other psychiatric conditions, an issue which has been addressed comprehensively in the psychiatric reports.

53.     Dr Hargreaves has not opined that the cessation of work was entirely due to the affects of alcoholism.  Consequently, whilst the applicant seeks to connect his cessation of work with a correlating escalation in the degree of his impairments, the Tribunal finds that this approach is misdirected and without foundation. It is clear from the reports of Drs Stevenson and Dr Reddan that an objective approach is warranted and this Tribunal agrees.

54.     Dr Reddan acknowledged the artificiality of separating the symptoms produced by alcohol abuse and from personality disorder. In order to produce a strict figure, the impairments would almost have to be halved. 

55.     On the other hand, Dr Hargreaves report, whilst suggesting that a Class A or Class B pension was warranted, has taken into account both the applicant's personality disorder and his alcoholism.

56.     Dr Reddan’s assessment of the applicant’s impairment to work as a driver was, to some extent, influenced by personality traits. She considered that any impairment, which would be spasmodic, would be in the order of 30 per cent.  She saw no reason why the applicant was fully capable of working as a mobile plant operator and labourer. 

57.     In respect to the work as a storeman, she considered that the level of impairment of 20 per cent emanated from the applicant’s personality disorder.  In respect to mining or construction labourer, Dr Reddan suggests that moderate impairment is present, having regard to the applicant’s personality which may mean that he would not have the attention to detail that is required.  He may also have difficulties getting on with other employees and that if he had been drinking heavily the night before - he may not be as careful as these positions require. Given that the evidence is that the applicant is consuming less alcohol during the week, the impairment is likely to be considerably less than the moderate range of 40 per cent suggested by Dr Reddan for this category, in the Tribunal’s view. 

58.     Similar considerations would apply to the applicant’s capacity to work as a security officer, in respect of which Dr Reddan allocated 30 per cent. 

59.     When the Tribunal took into account that Dr Reddan had regard to personality traits at least to some degree, the opinion of Dr Stevenson and giving substantial weight to the objective test results (which are supported by the applicant’s ability to remain in the work force until he retired due to war caused disabilities), the Tribunal considers that the impairment from prescribed impairments is in the upper range of small and that a reasonable classification of incapacity is 20 per cent. 

60. The Tribunal notes that there are no causally connected impairments pursuant to section 34(1B)(b) of the Act.

61.     In summary, the Tribunal affirms the decision that the level of incapacity for the kinds of civil employment identified earlier in this document is 20 per cent (Class C), and that the applicant is to be so classified with effect from 10 August 2001.  

I certify that the 61 preceding paragraphs are a true copy of the reasons for the decision herein of Ms J Cowdroy, Member

Signed:         Sarah Oliver
  Associate

Date of Hearing  11 July 2003
Date of Decision  29 June 2004
For the Applicant  Mr Payne, Armed Forces Assistance Centre
For the Respondent                  Mr B Dubé, Australian Government Solicitor