John Murray and Repatriation Commission
[2014] AATA 307
[2014] AATA 307
Division GENERAL ADMINISTRATIVE DIVISION File Number(s)
2012/3180
Re
John Murray
APPLICANT
And
Repatriation Commission
RESPONDENT
DECISION
Tribunal Senior Member J Toohey
Date 16 May 2014 Place Sydney The Tribunal affirms the decision under review.
.................................................
Senior Member J Toohey
CATCHWORDS – VETERANS ENTITLEMENTS – special rate of pension – multiple accepted conditions – PTSD – head injury – failed business venture – whether applicant prevented from continuing remunerative work by accepted conditions alone – decision under review affirmed
Legislation
Administrative Appeals Tribunal Act 1975 s 37
Veterans Entitlements Act 1986 ss 5Q(1), 19(9), 24(1), 24(2), 120(4)
Cases
Cavell v Repatriation Commission (1988) 9 AAR 534
Repatriation Commission v Hendy (2002) 76 ALD 47
Forbes v Repatriation Commission [2000] FCA 328
Flentjar v Repatriation Commission [1997] FCA 1200
Repatriation Commission v Butcher (2007) 94 ALD 364
Banovich v Repatriation Commission (1986) 69 ALR 395
Starcevich v Repatriation Commission (1987) 18 FCR 221
Smith v Repatriation Commission [2014] FCAFC 53
Magill v Repatriation Commission [2002] FCA 744
REASONS FOR DECISION
Senior Member J Toohey
Background
Mr John Murray served in the Australian Army from January 1969 to November 1970. He served in Vietnam for 12 months from November 1969. He suffers from multiple disabilities as a result of his service.
In 1996, Mr Murray was diagnosed with post-traumatic stress disorder (PTSD) which the Repatriation Commission (the Commission) has accepted as related to his service.
In 2010, the Tribunal, differently constituted, found that Mr Murray suffered a service-related brain insult in the form of a fat embolism in a motor vehicle accident in 1975. His disability has also been described as post-concussion syndrome. For simplicity, I will refer to it as Mr Murray’s head injury.
Mr Murray receives a service pension at 100 per cent of the General Rate. He contends that he is entitled to a pension at the Special Rate. The Commission disagrees.
Relevant legislation
To qualify for the Special Rate of pension, Mr Murray must satisfy the criteria in s 24(1) of the Veterans Entitlements Act 1986 (the Act). Mr Murray’s claim turns on whether he satisfies s 24(1)(c) and, in particular, whether he ceased to engage in remunerative employment for reasons other than his accepted disabilities.
Section 24(1)(c) has two limbs both of which must be satisfied. The first requires that Mr Murray be, by a reason of his incapacity from his war-caused injury alone, prevented from continuing to undertake remunerative work that he was undertaking.
The first limb is “ameliorated” by s 24(2)(b), the effect of which is to allow a veteran who has not been engaged in remunerative work to be treated as having been prevented, by reason of war-caused incapacity, from continuing to undertake remunerative work that he or she was undertaking, if he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage, and that incapacity is the substantial cause of his or her inability to obtain remunerative work.
The second limb requires that Mr Murray be, by reason of his war-caused incapacity, suffering a loss of salary or wages, or earnings on his own account, that he would not be suffering if free of that incapacity.
The second limb is to be read in conjunction with s 24(2)(a) which provides that Mr Murray will not satisfy s 24(1)(c) if he has ceased to engage in remunerative work for reasons other than the accepted incapacity, or if he is incapacitated or prevented from engaging in remunerative work for some other reason..
In summary, Mr Murray will not be taken to meet s 24(1)(c) if he has ceased to engage in remunerative work for reasons other than his war-caused injury, or if he is prevented from engaging in remunerative work for some other reason.
In deciding whether Mr Murray in entitled to the Special Rate of pension, the standard of reasonable satisfaction applies: s 120(4).
The “assessment period” is from 28 October 2002, when Mr Murray lodged his claim for disability pension, to the date of this decision: s 19(9).
The evidence
After discussion with counsel at the start of the hearing about the narrow issue to be determined, it was agreed that it was not necessary for Mr and Mrs Murray to give oral evidence and that their written statements would be sufficient. It was also agreed that it would not be necessary to hear oral evidence from medical witnesses who are substantially in agreement as to the significant cognitive impairment suffered by Mr Murray as a result of his accepted conditions.
The written material in evidence comprises: statements of evidence from Mr Murray and Mrs Murray; reports of Dr Anthony Dinnen and Dr Selwyn Smith, psychiatrists, and Dr Robin Chase, occupational physician, who saw Mr Murray for assessment; documents provided by the Commission in accordance with s 37 of the Administrative Appeals Tribunal Act 1975 (“the T-documents”); and the transcript of a hearing of the Veterans Review Board on 27 April 2012
Mr Murray’s employment and business
After leaving the Army in 1970, Mr Murray obtained qualifications in irrigation engineering. He started a commercial flower farm near Nowra and was involved in a florist business. The farm became the subject of protracted litigation when it was deemed unfit for human habitation due to soil contamination and was later compulsorily acquired by the Commonwealth.
In 1975, Mr Murray was involved in a motor vehicle accident which left him with his head injury. Although not entirely clear from the evidence, it appears accepted the accident was a suicide attempt by Mr Murray who was suffering psychiatric symptoms as a result of his experiences in Vietnam. He first came under psychiatric care in 1975 after the accident. He has been under the care of a number of psychiatrists and psychologists, and on various medications, since. He was on a Disability Support Pension for about ten years from 1975.
There is medical evidence, which is not challenged, to the effect that Mr Murray’s PTSD and head injury have affected his cognitive functioning and his ability to withstand stress.
In about 1986, Mr Murray went into a slate importing business with a neighbour. He invested around $300,000 and, later, put up three properties as security for loans to the business. The neighbour was a co-director, then an employee, of the business for several years. He and other employees apparently diverted funds from the business over time without Mr Murray’s knowledge. In 1996, the business went into voluntary administration. Mr Murray had to sell his investment properties to meet the company’s debts. In all, he lost around $1.5 million. He has not been employed since. From February 1995, he was again granted a Disability Support Pension.
Mr Murray says his former business partner put him under extreme pressure, yelling and shouting at him, and triggering memories of his experiences in Vietnam. The business never made a profit and, apart from being provided with a car towards the end, he never drew an income from it. It was not until his second wife, whom he married in 1992, went through the books of the business that its true state came to light. There was further protracted litigation over the winding up.
After the business ceased, Mr Murray worked for a time as a gardener but could not cope with the physical demands of the work. He worked for a brief period as a trainee train driver but again found the work too physically demanding. For about the last ten years he has had occasional work acting as a patient for examination by medical students.
Mrs Murray’s evidence
Mrs Murray describes Mr Murray’s business partner, who was a neighbour at the time, as “bleeding the company financially for his own ends”. She says the neighbour and his wife ingratiated themselves to Mr Murray and his parents, who are no longer alive, and promised his parents they would ensure nothing bad happened to him. When the neighbour suggested going into business, Mr Murray put his three houses “on the line” to guarantee the business and “could not see what was happening”.
Mrs Murray gave written evidence that the business was initially run from the neighbour’s home. Around the time she and Mr Murray married in 1992, she started doing the company books. It was then she discovered the company’s true financial position. In the ensuing legal proceedings, she says, Mr Murray was under a great deal of stress and collapsed in court on one occasion.
Mrs Murray does not believe Mr Murray would have found himself in the situation he did were it not for his accepted conditions. She does not believe he would have allowed himself to be misled and stood over by his neighbour. She says he still has flashbacks to Vietnam and the effect of his service on his mental health is “enormous”.
Contentions
For Mr Murray it is contended that his PTSD and the cognitive impairment resulting from the head injury rendered him vulnerable to exploitation, affected his memory and his ability to concentrate, and left him prone to making bad decisions, all of which affected his ability to manage his business. It is contended that his war-caused disabilities were the sole reason he ceased remunerative employment.
The Commission contends that, notwithstanding that Mr Murray’s PTSD and head injury affected his ability to manage his business, it was not the sole reason that he ceased to engage in remunerative employment. The Commission contends that he ceased to engage in remunerative employment because his business failed due, at least in part, to the fraudulent conduct of his former partner and other employees and because, once the business was wound up, Mr Murray no longer had the capital to continue in business.
Is Mr Murray prevented by his war-caused incapacity alone from engaging in remunerative work that he was undertaking?
The Tribunal’s task in applying s 24(1)(c) is “to make a practical decision whether the veteran’s loss of remunerative work is attributable to his service-related incapacities, and not to something else as well. It is a decision… [to be made] with an eye to reality, and as a matter in respect of which common sense is the proper guide”: Cavell v Repatriation Commission (1988) 9 AAR 534 at 539; see also Repatriation Commission v Hendy (2002) 76 ALD 47 and Forbes v Repatriation Commission [2000] FCA 328.
The word “alone” in s 24(1)(c) requires only that Mr Murray’s loss of employment be produced solely by his accepted disabilities. It need not be “the sole, unique and absolute cause” of his inability to work: Cavell (above). If some factor other than war-caused incapacity played a part in preventing him from continuing to undertake remunerative work, he will not satisfy s 24(1)(c) even if the war-caused condition is “by far and away the more dominant of the causes of the preventative effect”: Forbes (above).
The decision-maker is required to take into account “any factor that plays a part or contributes to the veteran being prevented from continuing to engage in remunerative work” and to “consider the effect, contribution to, and relative weight to be attached to any or all of those factors during the assessment period”: Hendy (above) at 54-55.
In Flentjar v Repatriation Commission [1997] FCA 1200, Branson J (Beaumont and Merkel JJ agreeing) described the approach to be adopted when applying s 24(1)(c) by reference to the following questions:
(a)what was the relevant remunerative work that the veteran was undertaking within the meaning of s 24(1)(c)?
(b)is the veteran, by reason of war-caused injury or disease prevented from continuing to undertake that work?
(c)if so, is the war-caused injury or disease the only factor or factors preventing the veteran from continuing to undertake that work?
(d)if the answers to (ii) and (iii) are yes, in each case, is the veteran by reason of being prevented from continuing to undertake that work, suffering a loss of income that he or she would not be suffering if free of that incapacity?
What was the remunerative work that Mr Murray was undertaking?
The Commission contends that the relevant remunerative work that Mr Murray was undertaking was that of managing a business. For Mr Murray it is contended that the Tribunal should take into account all types of employment in which he was engaged both prior to, and since, he ceased managing the business.
“Remunerative work” in the Act includes any remunerative activity: s 5Q(1). It is not confined, for the purposes of s 24(1)(c), to the last job undertaken by a veteran or to the particular tasks and duties undertaken in particular jobs. What is relevant is “the type of substantive work undertaken by the veteran at a higher level of generality”: Repatriation Commission v Butcher (2007) 94 ALD 364 at [7]; Banovich v Repatriation Commission (1986) 69 ALR 395; Starcevich v Repatriation Commission (1987) 18 FCR 221 at 225.
It is not clear to me what, in practical terms, it would mean to take into account, as suggested, all types of employment in which Mr Murray has ever been engaged, even briefly. In any event, for the ten years before the business was wound up, he was engaged full-time in its management. He had also managed a business previously, although for a shorter period. He undertook other types of work for relatively brief periods.
I find that “manager of a business” broadly describes the remunerative work Mr Murray was undertaking for the purposes of s 24(1)(c), not because it was the last work in which he was engaged but because it was “the type of substantive work undertaken by [him] at a higher level of generality”: Butcher (above).
It is not in dispute that Mr Murray is prevented by his war-caused injury from continuing to undertake that work. The question is “whether, nevertheless, there are other explanations for economic loss so that the incapacity is not the only reason for it”: Smith v Repatriation Commission [2014] FCAFC 53.
Is his war-caused incapacity the only factor preventing Mr Murray from continuing to undertake that work?
Section 24(2)(a) provides that, for the purpose of paragraph (1)(c):
a veteran who is incapacitated from war-caused injury or war-caused disease, or both, shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, by reason of that incapacity if:
(i)the veteran has ceased to engage in remunerative work for reasons other than his or her incapacity from that war-caused injury or war-caused disease, or both; or
(ii)the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason;
In Smith (above), Foster J described s 24(2)(a) as follows:
[It] should be regarded as an attempt to make crystal clear that s 24(1)(c) requires that a veteran be prevented from engaging in relevant remunerative work by reason of his or her war-caused incapacity. The cessation of work and the financial loss caused by that circumstance must be the consequence of the war-caused incapacity not the result of an independent decision to stop work or the consequence of incapacity brought about by some incident or other matter which is not war-caused.
For Mr Murray it is submitted that it is clear, on the evidence, that his PTSD and the effects of his head injury were the sole reason he ceased remunerative employment. It is submitted that the failure of the business due to the conduct of his former business partner and others, was, in effect, peripheral. It is submitted there is no evidence on which the Tribunal could be satisfied that any other factor played a relevant part.
In support of this submission, counsel for Mr Murray refers to Mr Murray’s written statement of evidence in which he says:
I ceased work because I was unable to cope with the pressure due to my PTSD & organic brain syndrome. I was a victim of constant yelling and screaming by a co-director which triggered memories of my time in the Army.
Mrs Murray elaborates on this in her written statement as follows:
John’s condition and his recurring PTSD have been the driving force for his current situation and played a major role in his position with the company. Due to his psychiatric condition, John was unable to stand up to the former owner and assert himself in the work environment. Accordingly, he was misled and chose to believe what the former owner and accountant were telling him about the financial situation of the company. I do not believe that John would have got into that situation were it not for his condition.
Mrs Murray describes in some detail the conduct of Mr Murray’s former partner. She states that, not long after she and Mr Murray married, she started working on the business’s books. She discovered it was “not doing well”, that this had been hidden from Mr Murray, and the financial statements he had been given did not reflect the true position.
The transcript of the hearing of the Veterans Review Board on 27 April 2012 shows that Mr and Mrs Murray found themselves with a failed business in large part because of the conduct of the others involved. For instance, Mr and Mrs Murray told the Board that the books of the business showed outstanding debt to the business but, when they contacted suppliers, they learned that they had already paid their accounts. Mr Murray described to the Board how he “tried to sue the [other] director directly and the bank for the misconduct and misrepresentation”. In that litigation he lost “just about everything”.
In a report dated 13 August 2013, Dr Anthony Dinnen, psychiatrist, who saw Mr Murray for assessment in July 1980, September 2006 and July 2013, wrote:
When asked what was the problem with the slate importing company the patient said that he couldn’t handle the stress. It appears that company ceased operating in 1996. When asked what the stress involved, the patient replied “anxiety. I turned to drinking heavily”.
Dr Dinnen also recorded:
With regard to his employment [Mr Murray] further commented that he wouldn’t be able to go back to work because he has no capital, and he doesn’t trust himself to make rational decisions or good decisions because of his decreased mental capacity.
For Mr Murray it is submitted that there is no evidence before the Tribunal on which it could be satisfied that Mr Murray’s former business partner or others acted fraudulently or that he ceased employment for any reason other than his war-caused incapacity. I accept there is insufficient evidence on which to be satisfied of the fraudulent conduct of Mr Murray’s associates, but that is not a finding I am required to make, or do make. It is clear from Mr and Mrs Murray’s evidence that the failure of the business was due, if not entirely, then in large part, to the conduct of Mr Murray’s former partner and others employed in the business.
I accept that Mr Murray’s PTSD and head injury would have made it difficult for him to withstand stress and played a part in the difficulty he experienced managing the business. Even without the apparently fraudulent conduct of his former partner and other employees, managing a business would be stressful. Dr Dinnen, and Dr Selwyn Smith, psychiatrist, and Dr Robin Chase, occupational physician, who assessed him for these proceedings all thought Mr Murray’s war-caused disabilities would have compromised his ability to manage the business.
I am satisfied, on the evidence before me that the conduct of Mr Murray’s former partner and others was such that the business would in all likelihood have failed regardless of Mr Murray’s accepted disabilities. It was the reason he ceased to engage in remunerative employment. Although they would have made it difficult for him to continue, it cannot be said that the failure of the business was itself the product of Mr Murray’s war-caused disabilities.
It is also clear that a factor contributing to preventing Mr Murray from continuing in employment was that, having lost the business and his assets, there was no longer a business to manage, and he no longer had the capital necessary to continue in it alone or to engage in managing another business. It cannot be said, on the evidence that, but for his war-caused incapacity, Mr Murray would still be engaged in the remunerative work that he was undertaking.
A veteran may cease remunerative employment on account of a range of factors, some of which are of such small significance as to be immaterial and which can be disregarded for the purposes of s 24(2)(a): see Cavell (above); see also Magill v Repatriation Commission [2002] FCA 744. That is not the case here. The conduct of Mr Murray’s partner and others, and the failure of the business that it led to, cannot be discounted as insubstantial or immaterial.
Conclusion
It is clear that Mr Murray has suffered greatly as a result of his war-caused disabilities. There is no doubt that they have affected almost every aspect of his life including his ability to manage his business and undertake remunerative employment. However, for the reasons I have given, I am satisfied that he ceased remunerative employment for reasons – or at least one reason – other than his war-caused incapacity alone. As he has not engaged in the remunerative work since, he cannot avail himself of s 24(2)(b).
This means that Mr Murray does not satisfy s 24(1)(c) and, regrettably, his claim must fail.
I affirm the decision under review.
52. I certify that the preceding 51 (fifty-one) paragraphs are a true copy of the reasons for the decision herein of Ms J Toohey, Senior Member.
..............................................
Associate
Dated 16 May 2014
Date(s) of hearing 30 April and 1 May 2014 Counsel for the Applicant Mr Tim Saunders Advocate for the Respondent Mr Tim O’Reilly
0
8
0