Ireland and Repatriation Commission

[2004] AATA 890

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 890

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No V03/873

VETERANS' APPEALS  DIVISION		)
Re		JOHN IRELAND

Applicant

And REPATRIATION COMMISSION

Respondent

DECISION

Tribunal Mr J Handley, Senior Member
Asssociate Professor J.H. Maynard, Member
Mr C. Ermert, Member

Date25 August 2004

PlaceMelbourne

Decision The decision under review is set aside and in substitution IT IS DECIDED, upon the concession of the respondent made during the hearing of these proceedings, that pension be paid to Mr Ireland at 100 per cent of the General Rate, with effect from 6 December 2002.  The remainder of the decision under review in so far as it found Mr Ireland did not have an entitlement to Special Rate pension is affirmed.

(Sgd) J Handley

Senior Member

VETERANS’ AFFAIRS – application for Special Rate pension – applicant 77 years at date of claim and working average 6-8 hours per week – discussion of s24(2A)(d) – not concerned with hours worked but whether working – comparison with s24(2) – decision to reject Special Rate affirmed

Veterans’ Entitlements Act 1986 (Cth) s5Q, s24, s31 and s119

Veterans’ Affairs (1994-95 Budget Measures) Legislation Amendment Act 1994

Banovich v Repatriation Commission (1986) 6 AAR 113

Grant v Repatriation Commission [1999] FCA 1629

Starcevich v Repatriation Commission (1987) 76 ALR 449

Repatriation Commission v Haskard [2002] FCA 1439

Grundman v Repatriation Commission [2001] FCA 892

REASONS FOR DECISION

25 August 2004 Mr J Handley, Senior Member
Asssociate Professor J.H. Maynard, Member
Mr C. Ermert, Member       

1.      The applicant applies to review a decision made by the Veterans’ Review Board (“VRB”) on 25 June 2003.  The VRB then decided to affirm a decision previously made by the respondent to assess pension payable to the applicant at 80 per cent of the General Rate, with effect from 6 December 2002.

2. Mr Ireland is presently 79 years of age and claims Special Rate pension. Subsequent to the commencement of these proceedings the respondent conducted a review pursuant to s31 of the Veterans’ Entitlements Act 1986 (“the Act”) and decided to increase pension to 90 per cent of the General Rate. During the hearing of these proceedings on 10 August 2004, Mr Rudge, who appeared on behalf of the respondent, conceded an entitlement to pension at 100 per cent of the General Rate. On the material read and on the evidence heard, we agree that concession has been appropriately made.

3.      Mr De Marchi appeared on behalf of Mr Ireland who gave evidence at the hearing.  Other witnesses were not called because the respondent conceded the applicant could not work for more than eight hours per week by reason of his war-caused injuries.  The respondent also conceded that the applicant had suffered a loss of remuneration.

4. The application is relatively unusual because it was acknowledged by Mr Ireland that he presently does work between an average of six and eight hours per week. The review ultimately concerned the interpretation and application of s24(2A)(d) of the Act. We will refer to this later.

5.      Mr Ireland presently has the conditions of sensori neural hearing loss, irritable bowel syndrome, gastro oesophageal reflux disease and post-traumatic stress disorder (“PTSD”) accepted as war-caused.  The condition of alcohol dependence or alcohol abuse was not accepted because incapacity was not found.

6.      Mr Ireland lodged a proof of evidence prior to the commencement of the hearing which was accepted into evidence without amendment.  It records that he served with the RAAF between 1 January 1943 and 6 February 1946.  After discharge Mr Ireland was engaged in clerical work with a number of employers.  Between the 1950’s and 1980 he was employed as an insurance inspector but studied and trained to be a podiatrist during that time.  He commenced self employment as a part-time podiatrist from the 1960’s working evenings and week-ends.  From 1980 he commenced full time self employment as a podiatrist working between 40 to 50 hours per week.  In approximately 1990 his working hours as a podiatrist reduced to 30 to 40 hours per week because it helped him cope with PTSD.  In approximately 1997 he and his wife relocated from Melbourne to Geelong to be close to other members of his family and to enjoy a different lifestyle.  Initially he was self employed as a podiatrist at about 20 hours per week but he became aware that he was suffering increased stress and irritability affecting his ability to concentrate.  He reduced his working hours as a podiatrist to approximately six to eight hours per week and continues to work at that level.  By reason of the reduced hours, Mr Ireland has lost remuneration.

7.      In evidence Mr Ireland said that he gradually reduced his hours and therefore his income from 1994 until 2000 because “the reflections of the war years became stronger and stories of war started to catch up.  I had to ease off”.  The applicant said that he was then having “bad dreams” which caused him to “feel disinclined” to work.  Income tax returns were lodged until 2000 but not since.

8.      Mr Ireland said that were it not for his PTSD he would “put in more hours because I love my work”.  In addition to his podiatry practice, Mr Ireland is also the honorary podiatrist to the Carlton Football Club (“CFC”).  This causes him to travel from Geelong to Melbourne and attend to current and past players.  He said that he visits his Melbourne clients on the occasions that he travels to Melbourne to undertake his work at the CFC.

9.      In cross-examination Mr Ireland said that he and his wife decided to move to Geelong from Melbourne to be closer to other members of their family and their grandchildren.  On a daily basis he and his wife assist their daughters by taking their grandchildren to and collecting them from school and also driving them to sporting activities.  He is also involved with lawn bowls locally as a player, a coach and an umpire.  He is also a member of the Geelong and Victorian Lawn Bowls Association.  He plays bowls every Saturday and on one or two occasions per week.  He gives lectures to local service clubs by reason of his prior experience and recollections as a Member of the St John’s Ambulance Brigade for 45 years.  At the commencement of the football season he would travel to the CFC rooms on three or four occasions per week but later in the season he would attend on only one or two occasions per week.

10.     When asked by Mr Rudge whether he reduced his working hours to accommodate his altered lifestyle since moving to Geelong, Mr Ireland said that he is a “loner” and if he were not undertaking his other activities he would “have nightmares”.  He said “I like to be the leader and to be in charge”.  By way of explanation he said that his lifestyle presently is in fact what he has chosen because in the absence of having a number of activities to undertake on a daily basis his thoughts “would take over”.  Mr Ireland was however keen to point out that his lifestyle in Geelong is no different to his lifestyle when he was living in Melbourne, that is, he was involved in a number of activities on a daily basis.

11.     In answer to some questions from us, Mr Ireland said that he presently attends clients in nursing homes in both Melbourne and Geelong and other clients in their private homes in Melbourne.  He charges a fee – depending on the service - which ranges between $5 and $30 per visit.  A diary is kept of the clients he has visited and the service undertaken.  He arranges return appointments when it is expected that further treatment will be required.

12.     The applicant did not have his diary with him when giving evidence but said that in the week prior to the date of hearing he attended six patients.  He said he sometimes puts in “one or two hard days” where he will work five or six hours on those days in order to give himself free time to participate in other activities.  He is presently paid cash by his clients and does not declare it because he has been advised by his accountants that his income is less than the level at which he is required to declare income and lodge a tax return.  When he last lodged a tax return in 2000 he claimed expenses associated with his telephone, his home office and running costs over his motor vehicle.

the legislation

13. Relevantly s24 of the Act – as it applies to this application – is reproduced as follows:

24 Special rate of pension 

(1)This section applies to a veteran if: 

. . .

(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 

(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 

. . .

(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; . . .

submissions

14. On behalf of the applicant it was submitted that the applicant should be entitled to special rate pension. It was noted that the respondent conceded s24(1)(b) with respect to the war-caused injuries and with respect to incapacity, having regard particularly to the medical opinions expressed by the respondent’s doctors. It was submitted that but for the employment and social activities undertaken by the applicant he would be totally incapacitated because he would not be able to cope with the effects of the PTSD.

15. It was submitted – contrary to the submissions that would be put by the respondent – that the applicant does satisfy s24(2A)(d) because the 1994 amendments to the Act introducing s24(2A) were intended to apply to veterans’ over the age of 65 and who were working. It was submitted that by reason of the applicant satisfying s24(1)(a) and (b) and s24(2A)(c) of the Act, it necessarily follows that s24(2A)(d) of the Act is satisfied. Additionally it was submitted that the applicant has been unable to undertake remunerative work within the meaning of s5Q of the Act and the expression “last paid work” refers to the actual work being undertaken prior to the making of the claim.

16. Additionally it was submitted that pursuant to s119 of the Act entitlement to pension should be considered with an eye to substantial justice and the absence of technicalities. It followed that substantial justice dictated that the applicant had an entitlement to special rate pension.

17. Mr Rudge submitted that s24(2A)(d) does not compel any inquiry into the number of hours being worked. It was submitted that that sub-section only causes enquiry into whether at the time of the making of the claim a veteran had been prevented from undertaking the work that was then being undertaken or had previously been undertaken by reason of war-caused injuries. It was submitted that this interpretation of sub-section (d) is consistent with the decision of Hill J in Repatriation Commission v Haskard [2002] FCA 1439 (“Haskard”).

18. Additionally it was submitted, by way of comprehending s24(2A) of the Act, that it applies to veterans who had achieved the age of 65 before the making of a claim whereas sub-section s24(2) of the Act applies to veterans who had not achieved 65 years at the date of claim. It was submitted that both sub-sections (2) and (2A) of the Act reflected the intention of the Parliament and Government policy at the time of the amending Act in 1994 namely, that the ameliorative provisions under sub-section (2) of the Act with respect to veterans under the age of 65 do not apply to veterans over the age of 65.

19. In reply Mr De Marchi renewed his submission that s24(2A)(d) did not disqualify Mr Ireland from entitlement to special rate pension. He submitted that previous decisions of the Federal Court in Banovich v Repatriation Commission (1986) 6 AAR 113 and Starcevich and Repatriation Commission (1987) 76 ALR 449 were applicable as was a more recent Full Federal Court decision of Grant v Repatriation Commission [1999] FCA 1629 (“Grant”).

20. In conclusion it was submitted that s24(2A) of the Act does not contemplate veterans who have ceased to be engaged in remunerative work but rather contemplates veterans who may be working but less than eight hours per week.

conclusion and reasons for decision

21. Section 24 of the Act was amended by the insertion of sub-section (2A) by the Veterans’ Affairs (1994/95 Budget Measures) Legislation Amendment Act 1994.  An explanatory memorandum then published by the Veterans’ Affairs Minister records (p24):

New paragraph (2A)(d) provides a test similar to that in the first part of the current paragraph (1)(c), but relates it to the veteran’s “last paid work”. The paragraph defines “last paid work” to mean the remunerative work that the veteran was last undertaking before he or she made the claim or application. Thus, the veteran must, because of incapacity from war-caused injury or war-caused disease or both, alone, be prevented from continuing his or her last paid work.

22. In the Second Reading Speech when the above amending Act was introduced to the House of Representatives on 9 June 1994, the Minister for Finance on behalf of the Veterans’ Affairs Minister (Hansard page 1809) – in reference to the amendments to s24 of the Act – advised the House:

The second initiative relates to changes to the eligibility criteria for special and intermediate rate pensions. The former being known in the past as the TPI, or totally and permanently incapacitated, pension. The criteria for these higher rates of disability pension were changed in 1985 when it became clear that the outmoded terminology of the old Repatriation Act was enabling these pensions to be paid to veterans who had completed a full working life, after retiring on superannuation and other retirement benefits. This was never intended. The original intention of these higher levels of pension was to compensate those severely disabled veterans who could not work to support their families on their return from service. It was to be in only very rare cases that any veteran beyond the normal retirement age would be eligible for such rates of pension.

Subject to certain exceptions and to protection of existing special and intermediate pensions, the changes being made by this bill reinforce that intention. They will mean that these pensions will not normally be granted to veterans who are over 65. An exception to this rule will apply if the veteran was engaged in remunerative work after the age of 65 and that work was in the same business or employment in which the veteran had been working for 10 continuous years. This would include, for example, many in the farming community.

23.     In Haskard, Hill J discussed sub-section (2A) (and a similar provision under s23) of the Act. His Honour recorded at paragraphs 26, 27, 28 and 31 the following:

26 When one comes to look at the provisions dealing with the Special Rate of pension, ie s 24, it is again clear that the veteran may be prevented from continuing to undertake remunerative work that he or she was undertaking, notwithstanding that the veteran may be capable of undertaking remunerative work for periods aggregating at least up to eight hours per week.

27 However, when one comes to the provision in question, s 24(2A), no reference at all is made to capacity for intermittent or part-time work of any kind, nor is there any provision which raises an implication that the veteran have some capacity to work intermittently or part-time.

28 . . . It seems to me that in each case where language equivalent to s 24(2A)(d) is used, what is required is that the veteran, by reason only of the war-caused injury or disease or both, can no longer work in the particular job or occupation that the veteran has had. In none of the occasions where these words are used is there any implication one way or the other that the veteran would be incapacitated from working in any other job or occupation. There is nothing in these words which goes to the question of capacity to work. All that is in question is whether the veteran has been prevented from continuing to undertake the particular remunerative work that he had undertaken. . . .

. . .

31 Not surprisingly, in the case of a veteran over the age of 65, the tests are more stringent. The degree of incapacity must still be at least 70%, except in the case where the veteran is suffering from pulmonary tuberculosis and have a degree of incapacity which prohibits the veteran from working more than eight hours per week. Those requirements go to the degree of incapacity but do not go to the provisions of s 24(2A)(d) which provides that it is that incapacity which prevents the veteran from continuing to undertake remunerative work that the veteran last undertook. Whether the incapacity does so prevent the veteran from continuing to undertake the remunerative work is a matter of fact. Either the veteran is or the veteran is not prevented from continuing to undertake the last paid work he undertook. If that last paid work was as here, acting as a property valuer on his own account, the question to be asked is whether that last paid work has ceased or whether it has continued. On the facts here it has not ceased but continued. All that has happened is that the quantity of work has declined but that does not mean that the work itself has ceased.

24.     In Grant the Full Federal Court of Merkel, Goldberg and Weinberg JJ in an examination of s24(2A)(d) decided at paragraph 8:

In order for a decision maker to be satisfied that the criterion in s 24(2A)(d) has been met the decision maker must determine:

* the "remunerative work" that the veteran was last undertaking before he or she made the claim or application;

* whether the veteran is, at any time during the assessment period, because of incapacity from war-caused injury or war-caused disease or both, alone, prevented from continuing to undertake that remunerative work.

25.     We are satisfied and find as a fact that immediately prior to the making of the claim upon the respondent which has given rise to these proceedings, the applicant had attained the age of 65 years and was then working as a podiatrist in self employment.  His hours were limited and had reduced considerably from the number of hours that he was able to work in years past, but at the date of claim Mr Ireland was working.  The podiatry practised by him was his “last paid work”. In reference to the provisions of s24(2A)(d) of the Act, Mr Ireland has not been prevented from undertaking his remunerative work of podiatry before the claim for pension was made, nor has he been prevented subsequently.

26.     Having regard to the policy of the Government as documented in the Hansard Second Reading Speech (when the 1994 amendments were introduced) and the decisions in Haskard and Grant and by reference also to the language of s24(2A)(d) of the Act, Mr Ireland cannot in the circumstances qualify for special rate pension.

27.     The submissions of Mr De Marchi with respect to the decisions of Banovich and Starcevich are without merit. Those decisions were delivered well before the 1994 amendments to the Act and did not involve any enquiry into the last employment actually undertaken prior to a claim being made.

28. Equally without merit is the submission that s119 of the Act should be applied in order to achieve substantial justice. In Grundman v Repatriation Commission [2001] FCA 892, Gray J at paragraph 33 decided that s119 does not permit the Tribunal to disregard statutory criteria.

29.     We found Mr Ireland to be a very remarkable person.  He was engaged in service in Europe during WWII and such were the horrors to which he was exposed he has suffered PTSD which has been accepted by the respondent.  Despite the enduring effects of that illness – manifesting to the present time in nightmares – Mr Ireland has shown remarkable enterprise by undertaking training as a podiatrist whilst he was engaged in full time employment elsewhere and ultimately becoming self employed as a podiatrist.

30.     Many persons having obtained the age of 79 years would prefer to enjoy “retirement” yet whilst this is partially achieved by the dedication of Mr Ireland to his family, children and grandchildren and to the lawn bowling community he has continued to practice as a podiatrist.  The manner in which he described his work and his commitment to his clients indicates to us that he is a person of considerable humanity.

31.     That he has continued to practice as a podiatrist and was so practising at the date of his claim is in fact the very reason he is disqualified from special rate pension.  That pension however is not a “reward” for service but rather is intended to provide a modest form of income to veterans who are unable to work by reason of war-caused injuries.

32.     Mr Ireland may have rights into the future in the event that he ceases employment but we of course decline to express any view on that issue.  That is a matter for discussion between Mr Ireland and his legal representative.

33.     However on what we have read and heard and learnt by these proceedings and by application of the legislation and the Federal Court decisions of Haskard and Grant we are obliged to decide that the decision under review, in so far as it concerned disqualification from special rate, must be affirmed. We do note however that during the currency of these proceedings the respondent conceded an entitlement to pension at 100 per cent of the General Rate with effect from 6 December 2002. That concession in our view is properly made and consistent with that concession the respondent is directed to adjust pension entitlement accordingly.

I certify that the 33 preceding paragraphs are a true copy of the reasons for the decision herein of:
Mr J Handley, Senior Member
Associate Professor J.H. Maynard, Member
Mr C. Ermert, Member

Signed:         Grace Carney
  Personal Assistant

Date of Hearing  10 August 2004
Date of Decision  25 August 2004
Solicitor for the Applicant          Mr D De Marchi
Departmental Advocate            Mr K Rudge