Jackson v Homestart Finance & Jackson v Homestart Finance - [2013] SAEOT 13

EQUAL OPPORTUNITY TRIBUNAL
(District Court Administrative and Disciplinary Division)
JACKSON v HOMESTART FINANCE & JACKSON v HOMESTART FINANCE
[2013] SAEOT 13
Judgment of His Honour Judge Costello, Member Ms A Bachmann and Member Mr D Shetliffe
5 December 2013
HUMAN RIGHTS - DISCRIMINATION - GROUNDS OF DISCRIMINATION - DISABILITY OR IMPAIRMENT
Complaints by a mother and her son against Homestart because of Homestart’s decision to decline to give them an interview for a home loan – Homestart’s decision to decline made because of its view that the son was unsuitable for a loan by reason of a mental disability – complainants subsequently providing Homestart with a medical report confirming son’s capacity to live independently and manage his affairs – complainants invited to reapply for loan which was then approved by Homestart.
HELD: Homestart unlawfully discriminated against both complainants because of son’s disability and ordered to pay compensation to the son in the sum of $2,500.00 and to the mother in the sum of $500.00.
Equal Opportunity Act 1984 s 5, s 6, s 66, s 76, s 96; National Consumer Credit Protection Act 2009 ; Disability Discrimination Act 1992 , referred to.
Hall & Ors v A & A Sheiban Pty Ltd & Ors (1988) 20 FCR 217; Ardeshirian v Robe River Iron Associates (1993) 43 FCR 475; Australian Iron & Steel Pty Ltd v Najdovska (1988) 12 NSWLR 587; Alexander v Home Office [1988] 1 WLR 968; Carman v Torrens Transit Services (North) Pty Ltd [2009] SAEOT 6; Tarr v Torrens Transit Services (North) Pty Ltd [2008] SAEOT 12; Moore v Slondia Nominees (No 2) [2013] SAEOT 5; Abdulla v Berkeley On Hindley Street Pty Ltd [2005] SAEOT 2; Ellson v PB Taxi Co Pty Ltd (No 2) [2008] SAEOT 9, considered.

JACKSON v HOMESTART FINANCE & JACKSON v HOMESTART FINANCE
[2013] SAEOT 13
Introduction

These proceedings involve two complaints, by Joan Jackson and her son, Dean Jackson, against Homestart Finance (‘Homestart’) alleging discrimination against them under the Equal Opportunity Act 1984 on the grounds of disability.[1]
[1] Although in her complaint Mrs Jackson adverted to other grounds, namely ‘race’ and ‘caring responsibilities’, neither of these grounds were seriously pursued.
The complaints arise out of a decision by Homestart to decline their home loan application as a result of Mr Jackson’s intellectual disability. In view of the fact that both complaints involve the same alleged course of conduct on the part of Homestart, the Tribunal determined to hear them together.
In cases of alleged discrimination on the grounds of disability the Act relevantly provides:
76—Discrimination in provision of goods and services
(1) It is unlawful for a person who offers or provides—
(a) goods; or
(b) services to which this Act applies,
(whether for payment or not) to discriminate against another on the ground of disability—
(c) by refusing or failing to supply the goods or perform the services; or
(d) in the terms or conditions on which or the manner in which the goods are supplied or the services are performed...(our emphasis)
5—Interpretation
(1)In this Act, unless the contrary intention appears—
services to which this Act applies means—
...
(c) services provided in the course of a banking business (within the meaning of the Banking Act 1959 of the Commonwealth), the provision of credit, or insurance ...
66—Criteria for establishing discrimination on ground of disability
For the purposes of this Act, a person discriminates on the ground of disability—
(a)if he or she treats another unfavourably because of the other's disability, or a past disability or a disability that may exist in the future; or
...
(f)if he or she treats another unfavourably because of an attribute of or a circumstance affecting a relative or associate of the other, being an attribute or circumstance described in the preceding paragraphs. (our emphasis)
5—Interpretation
(1)In this Act, unless the contrary intention appears—
disability, in relation to a person, means—
(a) total or partial loss of the person's bodily or mental functions; or
(b) total or partial loss of a part of the body; or
(c) the presence in the body of organisms causing disease or illness; or
(d) the presence in the body of organisms capable of causing disease or illness; or
(e) the malfunction, malformation or disfigurement of a part of the person's body; or
(f) a disorder or malfunction that results in the person learning differently from a person without the disorder or malfunction; or
(g) a disorder, illness or disease that affects a person's thought processes, perception of reality, emotions or judgment or that results in disturbed behaviour;
6—Interpretative provisions
...
(3)For the purposes of this Act, a person (the discriminator) treats another unfavourably on the basis of a particular attribute or circumstance if the discriminator treats that other person less favourably than in identical or similar circumstances the discriminator treats, or would treat, a person who does not have that attribute or is not affected by that circumstance.
...
Background to the Complaints
Mr Jackson is 31 years old. As an infant Mr Jackson had renal failure which required him to have a renal transplant. Up until the time that he was 10 years old Mr Jackson had spent the majority of his life in hospital and as a result had very limited education.
His needs are such that Mrs Jackson has adopted the role of his carer. She provides assistance to him in his dealings with organisations like Centrelink and with the wide range of medications he needs to take to ensure the retention of his transplanted kidney. Otherwise Mr Jackson is able to generally live independently and manage his own affairs and day to day finances.
In July 2012 Mrs Jackson arranged an appointment with Homestart for herself and Mr Jackson to discuss a possible joint home loan. During this appointment a number of different types of loans were discussed with a loan consultant of Homestart, Mr McKinnon.
At the conclusion of the appointment it was agreed that Mr McKinnon would speak to his manager about their eligibility for certain loans and that a further appointment would need to be arranged. During the appointment Mrs Jackson did the bulk of the talking on behalf of her son who is by nature a shy and somewhat reserved individual.
After the appointment Mr McKinnon had concerns with respect to Mr Jackson’s ability to understand the subject of a home loan. Because Mrs Jackson did most of the talking, Mr McKinnon was unable to interact sufficiently with Mr Jackson in a way which permitted him to gain an appreciation as to whether Mr Jackson had the requisite level of understanding of the details and obligations of a possible loan contract.
Mr McKinnon raised his concerns with his manager, Ms Reidlinger (Homestart’s Policy and Compliance Manager) who telephoned Mrs Jackson on the following day, 19 July 2012. Mrs Jackson’s version of the conversation is that Ms Reidlinger said, in quite abrupt terms, that the Jacksons would not be getting a further interview whereas Ms Reidlinger said that she informed Mrs Jackson that, amongst other things, in order to process the application, Homestart would either need to interview Mr Jackson on his own or sight medical evidence as to his capacity to understand financial matters generally. On her version the conversation ended without Mrs Jackson committing to either course of action.
Following that conversation she wrote to Mrs Jackson, on 20 July 2012, indicating that their home loan application had been declined on the grounds of ‘unsuitability’.[2]
[2] Although in part of her evidence Ms Reidlinger said that by this term she meant that she did not believe that ‘we had been given enough information to provide an approval’ (T140) elsewhere she said that one of the grounds of ‘unsuitability’ involved her reservations ‘about Mr Jackson’s ability to understand and undertake a loan’ (T132).
In August 2012 Mr & Mrs Jackson lodged their complaints with the Equal Opportunity Commission.
In September 2012 Mrs Jackson provided the Commission with a copy of a letter from Mr Jackson’s doctor which stated that Mr Jackson had the capacity to live independently and manage his own affairs and day to day finances. The doctor also indicated that Mr Jackson did not require a legal guardian. Unfortunately, it would appear that a copy of this letter did not come to the attention of Homestart until January 2013.
Soon after it became aware of the doctor’s letter, the Jacksons were invited by Homestart to reapply for a home loan. In May 2013 Homestart approved the loan. The Jacksons have now purchased a home with the benefit of a Homestart loan.[3]
[3] The loan ultimately given to the Jacksons involved a loan (‘the Wyatt facility’) which was outside Homestart’s guidelines and apparently approved in a gesture of goodwill by Homestart (T118-119).
It was suggested in evidence that if the loan had been approved prior to October 2012, Mr Jackson may have been entitled to a First Home Owner’s Grant of $7,000.00. After October 2012 this Grant was reduced to $5,000.00 which was the amount he actually received on the purchase of his current home.
Finally, we were referred by counsel for Homestart to certain provisions in the National Consumer Credit Protection Act 2009 (‘NCCPA’) pursuant to which Homestart is obliged to assess the suitability of applicants for loans. Suitability in this respect includes an applicant’s capacity to understand the terms of a credit contract. Heavy penalties apply for institutions which fail to comply with the requirements of the NCCPA.
The Witnesses
The Complainants’ Case
Mr Jackson was a quietly impressive witness. Although he exhibited a degree of confusion with respect to details regarding some dates and times, we have no hesitation in accepting him as a witness of truth.
He gave evidence regarding his appointment with Mr McKinnon. He told us that he allowed his mother to ‘take the lead role’ in the interview. We formed the impression that he is a naturally introverted and shy individual who prefers more often than not, to let others do the talking. However, he displayed an ability to understand and answer many questions regarding the circumstances leading up to and surrounding his application for a loan and the interview.
We have no hesitation in accepting his evidence that he felt humiliated on being informed by his mother (after she had spoken to Ms Reidlinger on 19 July 2012) that there would be no further interview with respect to a loan and that in essence their application was being refused on the basis (as it was conveyed to him by his mother) of his inability to understand the meaning and impact of the loan.
Mrs Jackson gave evidence of the appointment with Mr McKinnon, which she described as one which was ‘rushed’ and where she felt Mr McKinnon was abrupt. She agreed that she did most of the talking for herself and Mr Jackson. She spoke of feeling the need to get as much discussed as possible due to time constraints in the length of the interview and said that Mr McKinnon was somewhat ‘negative’ to her about various loan types and their eligibility for them.
She also told us about the telephone conversation she had the following day with Ms Reidlinger. She said that the telephone call took place as she was getting off a bus and as she walked towards her car. She said that, in essence, Ms Reidlinger told her that their application had been considered and that she would not be getting another interview. Later in her evidence she agreed that Ms Reidlinger may have expressed concerns about Mr Jackson’s capacity to appreciate the details of any loan.
She denied that Ms Reidlinger offered them the opportunity to come in for another interview or put medical information to Homestart regarding Mr Jackson’s capacity. She also denied saying that Mr Jackson would have been ‘institutionalised’ without her help or that he was financially or psychologically dependent on her. She did however accept that she may have told Ms Reidlinger that Mr Jackson had a ‘mild intellectual disability’.
She expressed a degree of bewilderment at receiving a letter from Ms Reidlinger, dated the day after their telephone call, declining their application for a loan. She told us that she then wrote to Homestart’s Chief Executive Officer who a week or so later, confirmed Ms Reidlinger’s decision.
Mrs Jackson also told us of her role in raising Mr Jackson in infancy. She told us that Mr Jackson had needed to be fed through a naso-gastral tube everyday for the first ten years of his life, that he was regularly hospitalised and that there were very real fears for his life in his early childhood.
Mrs Jackson presented as a passionate individual and supporter of her son. We have no reason to doubt that she was absolutely genuine in what she told us although there were occasions when we felt that her passionate support for her son clouded her recollection of events and led her to perceive some responses from Homestart (particularly from Mr McKinnon) in an overly negative light.
The Respondent’s Case
Mr McKinnon gave evidence as to the events surrounding the appointment on 18 July 2012. He told us that various types of loans were discussed and that, with respect to a loan such as the ‘Whyatt’ loan, he told the Jacksons that in his view their application fell outside Homestart’s eligibility guidelines to receive it. He also said that he told them that he could not bind Revenue SA on the issue of Mr Jackson’s entitlement to a First Home Owner’s Grant. He denied being ‘negative’ to the Jacksons and said that he was really only trying to paint a realistic picture for them. He agreed that the appointment concluded with an understanding that they would be ‘getting back’ to the Jacksons once he had spoken with management about their eligibility for certain loans and as to what further information Homestart needed from the Jacksons.
He told us that Mrs Jackson did most of the talking and ‘jumped into’ the conversation when he tried to involve Mr Jackson. As a result he said that he was ‘not able to assess his ability to enter into a loan contract’.[4]
[4] Exhibit R2 at [31] and [44].
He said that following the interview he conveyed these concerns to Ms Reidlinger.
We generally accept Mr McKinnon’s evidence. We found him to be an honest and forthright witness.
Ms Reidlinger gave evidence of a telephone conversation which she had with Mrs Jackson on 19 July 2012. She said that during the conversation Mrs Jackson told her that her son was unable to manage himself ‘psychologically and financially’ and would be ‘institutionalised’ without her.[5]
[5] Exhibit R3 at [22].
She then said that she told Mrs Jackson she understood that her son had not contributed to the conversation during the appointment the previous day and that she said ‘if we do have another interview we need to interview you and Dean separately or get some medical information that he’s ok to enter into a loan contract or alternatively do you have some sort of power of attorney over his affairs?’.[6]
[6] Exhibit R3 at [18].
She said that Mrs Jackson said words like ‘why would I need that?’ and indicated that she would go to the Minister regarding their loan application. She then said that Mrs Jackson said that she would be putting something in writing to her.
She said that Mrs Jackson did not indicate that she would be providing medical information or a power of attorney or that she was going to take her up on any of the ‘offers’ she had made.
She agreed that, without further contact from either of the Jacksons, she wrote a letter to them the following day ‘declining’ their application for a loan.
She told us that at the time she spoke to Mrs Jackson she had available to her, details as to Mr Jackson’s phone number. She also said that she was conscious of the need to speak to Mr Jackson on his own.
However, she could not answer why (prior to declining the application) she did not attempt to contact him personally and invite him to come in other than to say that Mrs Jackson was defensive and she did not know whether contacting him would create ‘angst or anything’.[7]
[7] T131.
She agreed that, even though one of the reasons for declining the application was her reservation about Mr Jackson’s ability to understand the loan, she made her decision to decline their application within the space of 24 hours and that she did so without attempting to speak to Mr Jackson or offering him an opportunity to come in on his own so that an assessment of his capacity in that regard could be made.
Finally, she agreed that, although the purpose of her conversation with Mrs Jackson was to invite her to come in and provide further information, a day later the application was declined.[8]
[8] T133.
She proffered, as the reason for an apparent change in that regard by Homestart, certain conversations that she had with senior management which led her to conclude that it would not be suitable for Homestart to enter into a contract ‘unless we could get that further information’.[9] However, without any endeavours to seek that further information, the application was simply declined.
[9] T133.
Despite our views as to the propriety of some of the actions of Ms Reidlinger (to which we will refer later) we nevertheless accept that she was a genuine witness who gave her evidence in a forthright manner.
Discussion
Although, as we have said, there were grounds other than ‘disability’ alluded to in the complaint of Mrs Jackson, these were not seriously pursued and we have not had regard to them in our consideration of the matter.
In essence, both complainants have asserted that they were treated unfavourably within the meaning of the Act and focussed their complaints on the ground of Mr Jackson’s disability.
‘Disability’ is defined by the Act in very wide terms.[10] We are prepared to accept that the renal malfunction suffered by Mr Jackson together with the extended hospitalisation and absence of education have combined to leave him with a loss of mental function (albeit very mild) sufficient to satisfy the requirements for a ‘disability’ under the Act.
[10] s 5 of the Act.
However, we are equally satisfied that that loss of mental function was (as has been demonstrated by the subsequent grant of a loan) not such as to prevent him from being able to understand the nature and impact of the loan.
The provisions of s 76 of the Act make it unlawful for Homestart to discriminate against the Jacksons on the ground of his disability by refusing inter alia to perform services in the course of providing credit.
The central question in these proceedings is whether or not Homestart treated Mr Jackson unfavourably in declining to give him a further interview because of his disability. It must follow that if we are satisfied that Homestart did so treat him, Mrs Jackson would also have been treated unfavourably by reason of the provisions of s 66(f) of the Act which catch unfavourable treatment of one person by reason of an attribute affecting a relation of that person.
In deciding whether Mr Jackson has been treated unfavourably because of his disability, we have had regard to the provisions of s 6(3) which dictate that a person (‘the discriminator’) treats another unfavourably on the grounds of disability if the person treats that other person less favourably than in identical or similar circumstances, the discriminator would have treated a person who does not have that disability.
In Purvis v New South Wales (Department of Education and Training)[11] the High Court considered a similarly worded provision (to s 6(3)) in the Disability Discrimination Act 1992 and said that the provision:
...requires comparison between the treatment which the discriminator gives...to the aggrieved person and the treatment that the discriminator would give...to a person without the aggrieved person's disability ‘in circumstances that are the same or are not materially different’.[12] If that comparison reveals that the disabled person was treated less favourably, the further question which must be asked is whether that was because of the disabled person's disability. Section 5(1), therefore, requires equality of treatment between the disabled and those who are not. Attention is invited to how the discriminator ‘treats or would treat a person without the disability’ (italics added). The ‘comparator’ identified by s 5(1) is ‘a person without the disability’.
[11] (2004) 78 ALJR 1 at [213] per Gummow, Hayne & Heydon JJ.
[12] In contrast to the phrase ‘identical or similar’ in s 6(3).

Although the details of the treatment meted out to Mr Jackson, by reason of Ms Reidlinger’s conduct, are very much the subject of dispute between her and Mrs Jackson, we do not find it necessary for these purposes to resolve that dispute.[13]
[13] Although it has been unnecessary to resolve the dispute, we are inclined to prefer the version proffered by Ms Reidlinger. Mrs Jackson in evidence-in-chief initially suggested that there was virtually no conversation between them, a view she later recanted when shown details of her complaint written only a week after the conversation. Ms Reidlinger’s notes of the conversation record it as a 14 minute conversation and attribute a number of statements to Mrs Jackson which we are inclined to accept as having been made by her.
For the purposes of our assessment on this issue we are prepared to assume that Ms Reidlinger’s account of her conversation with Mrs Jackson is correct.
It appears to us that following her conversation with Mrs Jackson, Ms Reidlinger formed the assumption that Mr Jackson’s disability was such that he may not have been able to understand the loan and that the Jacksons were thereby unsuitable for a loan.
In our view, she reached that assumption on very little ‘hard’ information. She did so upon the basis of limited observations by Mr McKinnon and statements by Mrs Jackson to the effect that inter alia she was her son’s carer and that he would not be able to manage on his own financially or psychologically without her.
Whilst we accept that the NCCPA placed obligations on Homestart to exercise caution in such circumstances, it was, in our view, quite unreasonable of her to make a decision to decline the loan on account of Mr Jackson’s disability without attempting to at least contact him and invite him either to come in for an interview or, if he preferred, to supply medical information.
We are satisfied that Homestart did treat him unfavourably within the meaning of s 66 of the Act, by declining the application for a loan without making those overtures to him. In our view, at the very least, Ms Reidlinger should have raised with Mrs Jackson the question of whether it was appropriate to speak to Mr Jackson directly given her belief that a ‘one on one’ interview with him was desirable if not necessary.
Importantly, we are also satisfied that Ms Reidlinger would not have declined to offer a further interview to a person, in Mr Jackson’s circumstances, without his disability.
In unilaterally declining the loan, without seeking to speak to Mr Jackson, Homestart unlawfully discriminated against Mr Jackson on the grounds of his disability, and in turn against Mrs Jackson (within the meaning of s 66(f) of the Act), contrary to the provisions of s 76 of the Act.
Compensation
Both complainants sought compensation. In considering our approach to this aspect of the complaints we have had regard to the following general principles.
The purpose of an award for loss or damage, under anti-discrimination legislation such as this, is to compensate the complainant and not to penalise or punish the respondent.[14]
[14] Hall & Ors v A & A Sheiban Pty Ltd & Ors (1988) 20 FCR 217; Ardeshirian v Robe River Iron Associates (1993) 43 FCR 475.
Although some judges have suggested that, in assessing the quantum of compensation, reference may be had to the general principles governing the measure of damages in tort,[15] others have said that its measure is to be found, not in the law of tort, but in the words of the statute which require no more to attract the exercise of the discretion than that the loss or damage is occasioned by reason of the respondent’s unlawful conduct.[16]
[15] Hall & Ors v A & A Sheiban Pty Ltd & Ors at p 239 per Lockhart J.
[16] Hall & Ors v A & A Sheiban Pty Ltd & Ors at p 281 per French J.
Ultimately however, the Tribunal’s assessment of compensation is essentially a matter of fact and the method adopted must relate to the particular circumstances of the case.[17]
[17] Australian Iron & Steel Pty Ltd v Najdovska (1988) 12 NSWLR 587 per Priestley JA; Street CJ & Mahoney J agreeing.
The damage for which a person may be compensated under the Act includes injury to his or her feelings.[18] Generally speaking, injuries to feelings, which are likely to be of a relatively short duration, are less serious than physical injury to the body or mind which may persist for months or in many cases for life.[19]
[18] s 96(3) of the Act.
[19] Alexander v Home Office [1988] 1 WLR 968, 975; Hall & Ors v A & A Sheiban Pty Ltd at p 256.
Finally, and acknowledging that awards may differ, according to the particular circumstances of each case, we have nevertheless had regard, in a general sense, to other awards in this jurisdiction for injuries to feelings.[20]
[20] Carman v Torrens Transit Services (North) Pty Ltd [2009] SAEOT 6; Tarr v Torrens Transit Services (North) Pty Ltd [2008] SAEOT 12; Moore v Slondia Nominees (No 2) [2013] SAEOT 5; Abdulla v Berkeley On Hindley Street Pty Ltd [2005] SAEOT 2; Ellson v PB Taxi Co Pty Ltd (No 2) [2008] SAEOT 9.
In considering the issue of compensation in the instant case, we make two observations.
First, we acknowledge the obligations for credit providers, such as Homestart, to ensure that loans are not made to persons who lack the capacity to understand and/or comply with their requirements together with the very heavy penalties which apply for a failure to comply with those obligations. As such credit providers, like Homestart, need to approach their decisions as to whether loans should be made with a good deal of caution. In this respect we accept that in making her decision, Ms Reidlinger held a genuine but erroneous belief that refusing the application was in the best interests of Mr Jackson. However, in our view, however genuine she may have been, the assumptions she made which lead her to make her decision were both precipitous and ultimately shown to be unwarranted.
Secondly, in considering our decision with respect to the quantum of compensation, we have had regard to and taken into account the fact that Homestart subsequently granted the Jacksons a loan which permitted them to purchase a home, albeit a different home from the one they wished to purchase at the time of the first application. Absent these matters we may have been minded to award compensation at a higher level.
In assessing compensation we are satisfied that if the loan application had not been declined, there was a chance that Mr Jackson would have obtained a First Home Owner’s Grant of $7,000.00 as opposed to the $5,000.00 which he ultimately received in 2013.
On the state of the evidence it has not been possible to determine, with any degree of precision, whether the grant would have been made. Nevertheless he should be compensated for the loss of that chance. Adopting a broad axe approach to this aspect, we would assess compensation under this head at $1,000.00.
We are also satisfied that Mr Jackson did experience feelings of hurt and humiliation by reason of the unilateral and abrupt communication of the refusal of the loan application because of a perceived inability on his part to understand the loan. We accept that these feelings continued for some months, at least until January 2013, when they were asked to reapply for the loan. Under this head we assess compensation in the sum of $1,500.00.
In all the circumstances we are of the view that an overall award of compensation in his favour of $2,500.00 is appropriate.
We are similarly satisfied that Mrs Jackson reasonably experienced feelings of hurt and humiliation for some months because of the way in which their loan application was declined. As the reason for refusal was the perceived incapacity of her son, rather than her, the award under this head for her should be less.
In all the circumstances an award of compensation for her of $500.00 is appropriate.
Formal Orders
1     The Complaints are upheld.
2     In Action No. 1325 of 2013 Homestart Finance are to pay compensation to Mrs Jackson in the sum of $500.00.
3     In Action No. 1326 of 2013 Homestart Finance are to pay compensation to Mr Jackson in the sum of $2,500.00.