John Sheldon and Repatriation Commission
[2014] AATA 228
[2014] AATA 228
Division VETERANS' APPEALS DIVISION File Number
2012/5145
Re
John Sheldon
APPLICANT
And
Repatriation Commission
RESPONDENT
DECISION
Tribunal Deputy President PE Hack SC
Date 17 April 2014 Place Brisbane The decision under review is affirmed.
........................................................................
Deputy President PE Hack SC
CATCHWORDS
VETERANS’ AFFAIRS – veterans’ entitlements – pension – special rate – what type of work may be undertaken with applicant’s skills, qualifications or experience – whether totally or permanently incapacitated - whether there are other reasons preventing continuing remunerative work – whether genuinely seeking to engage in remunerative work.
LEGISLATION
Veterans’ Entitlements Act 1986 (Cth) ss 23, 24(1)(b), 24(1)(c)
CASES
Chambers v Repatriation Commission (1995) 55 FCR 9
Repatriation Commission v Hendy [2002] FCAFC 424; (2002) 76 ALD 47
Smith v Repatriation Commission [2012] FCA 1043
REASONS FOR DECISION
Deputy President PE Hack SC
17 April 2014
Mr John Sheldon is a veteran as that term is used in the Veterans’ Entitlements Act 1986 (Cth). He suffers from a number of conditions that the Repatriation Commission accepts are war-caused. In these proceedings Mr Sheldon seeks a review of a decision of the Commission, affirmed by the Veterans' Review Board, that he was not qualified to receive pension at the special rate, that is, the rate referred to in s 24 of the Act.
To receive a disability pension at the special rate a veteran must satisfy each of the six criteria in that section. There is no argument about four of them – those in paragraphs (aa), (aab), (a) and (d) of s 24(1). The contest in the proceedings is over paragraphs (b) and (c) of the subsection. Those criteria are as follows,
(1)This section applies to a veteran if:
…
(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
(c)the veteran is, by reason of incapacity from that war‑caused injury or war‑caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity; and
…
Mr Sheldon, in the alternative, argues that he satisfies the requirements in s 23 of the Act for pension at the intermediate rate. That section is in terms relevantly identical to s 24 save and except that s 23(1)(b) speaks of a veteran incapable of undertaking remunerative work "otherwise than on a part-time basis or intermittently" rather than "for periods aggregating more than 8 hours per week". Section 28 of the Act sets out the matters to which regard must be had when considering s 24(1)(b) of the Act. It provides:
In determining, for the purposes of paragraph 23(1)(b) or 24(1)(b), whether a veteran who is incapacitated from war‑caused injury or war‑caused disease, or both, is incapable of undertaking remunerative work, and in determining for the purposes of section 24A whether a veteran who is so incapacitated is capable of undertaking remunerative work, the Commission shall have regard to the following matters only:
(a)the vocational, trade and professional skills, qualifications and experience of the veteran;
(b) the kinds of remunerative work which a person with the skills, qualifications and experience referred to in paragraph (a) might reasonably undertake; and
(c)the degree to which the physical or mental impairment of the veteran as a result of the injury or disease, or both, has reduced his or her capacity to undertake the kinds of remunerative work referred to in paragraph (b).
Section 24(2)(b) of the Act need also be noted. It provides,
(2) For the purpose of paragraph (1)(c):
…
(b)where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that 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 in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking.
Finally, the questions that arise must be considered during the entirety of the assessment period, that is, the period starting from the day the claim was made to the day it was determined.[1] In Mr Sheldon’s case the assessment period started in September 2010.
[1]See s 19(5C) and (9) of the Act
To understand the arguments of the parties some reference needs now to be made to the factual background.
Mr Sheldon was born in 1947. He enlisted in the Australian Regular Army in 1964 and rendered operational service between August 1966 and March 1967. After his discharge from the Army he pursued semi-skilled occupations. In 1974 Mr Sheldon purchased a backhoe and commenced business on his own account. He continued in that business until 1978 when he bought a front-end loader and operated his business using that piece of equipment. Then from 1986 until about July 2009 Mr Sheldon resumed operating his business using a backhoe. At least in the later years, the business was operated by a company, controlled by Mr Sheldon, which acted as the trustee of a discretionary trust. In July 2009 the backhoe and a truck used to transport it were sold it to a company that I shall call Broadwater,[2] controlled by a Mr Moar. Mr Moar was a plumber. Mr Sheldon had undertaken considerable work as a subcontractor for Mr Moar over the previous 23 years and had considerable experience in operating a backhoe in aid of plumbing and drainage works. Part of the overall agreement with Mr Moar was that Mr Sheldon would continue to operate the backhoe for at least 12 months, in effect if not in name, as an employee of the purchaser. He was paid $35 per hour but was not guaranteed any particular number of hours. Mr Sheldon continued in that role until November 2011. He has not worked since because, he says, his back and knees cause him such pain and discomfort that he is unable to do so.
[2]There are two companies referred to in the material, Broadwater Excavations Pty Ltd and Broadwater Plumbing Pty Ltd. It is unclear which one acquired the equipment however that seems not to matter.
The Commission produced time sheets compiled by Mr Sheldon in the period from the end of March 2011 to the day when he ceased work in November 2011.[3] They demonstrate that Mr Sheldon was working considerable hours over that period and that, in some weeks, he worked in excess of 35 hours. The average hours worked on the days when work was available was generally in excess of 6 hours and, in one week, as high as 9.5 hours. On more than half of the weeks Mr Sheldon worked in excess of 20 hours and, when he did not work, it appears to have been a consequence of “no work”, “wet” or “work stop”. There is no suggestion in any of the documents that Mr Sheldon was prevented from working by reason of his accepted conditions. Given what the documents demonstrate there can be no suggestion that Mr Sheldon was incapable of undertaking remunerative work on any basis prior to 17 November 2011, that being the last day on which he worked. Thus, whilst the assessment period commences in September 2010, Mr Black, counsel for Mr Sheldon, accepted that the application could not succeed prior to November 2011.
[3] Exhibit 7.
Mr Sheldon has lumbar spondylosis that has been accepted as a war-caused condition by the Commission since April 2009. In September 2010 Mr Sheldon made application to the Commission for an increase in his disability pension. His application[4] said of his lumbar spondylosis,
I am unable to continue working due to the amount of lifting involved – driving & operating machinery on uneven ground causes jarring in my back. I am in constant pain.
Nothing was said in the claim about Mr Sheldon's knees. In December 2010, and in response to that claim, the Commission decided to continue Mr Sheldon's disability pension at 90% of the General Rate.[5]
[4]Exhibit 1, page 35.
[5]Exhibit 1, page 309.
Mr Sheldon sought a review of that decision by lodging an application for review with the Veterans’ Review Board in February 2011.
Thereafter, and I infer in April 2011, Mr Sheldon lodged a claim for acceptance of osteoarthritis, to both his knees, as a war caused condition. That claim was accepted by the Commission in October 2011 which then assessed his pension at 100% with effect from 15 April 2011.
Mr Sheldon's application to the Veterans' Review Board came on for hearing in September 2012. The Board was not satisfied that Mr Sheldon qualified for pension at the special rate but it set aside the Commission's decision of December 2010 to give effect to the acceptance of osteoarthritis to both knees. It substituted a decision that Mr Sheldon be paid pension at 90% of the General Rate with effect from 10 April 2009 and at 100% from 15 April 2011. By virtue of s 175(1) of the Act, it is the decision of the Board of 11 September 2012 that is the subject matter of this application.
There are medical reports in the material from Dr Journeaux and from Dr Dodd however they are somewhat dated. The report of Dr Journeaux, in particular, was done approximately 12 months before Mr Sheldon ceased work and that of Dr Dodd was contemporaneous with his ceasing work. I did though have the benefit of evidence, and more up-to-date reports, from Dr Peter Sharwood, a consultant orthopaedic surgeon, and from Dr Blair Christian, a consultant occupational physician.
Dr Sharwood saw Mr Sheldon on 5 September 2013 for the purposes of providing a medico-legal report. He expressed the opinion that Mr Sheldon "would be unable to work eight hours per week". Dr Sharwood reviewed CT scans taken on 30 August 2010 and 28 June 2011 which, he said, demonstrated significant progression of disc degeneration over that period. I must say that I was concerned that Dr Sharwood regarded as irrelevant to the opinion he expressed that Mr Sheldon was working on essentially a full-time basis up until November 2011. That information seems to me to be highly relevant to the opinion that he expressed given his evidence about the state of scans taken in June 2011, whilst Mr Sheldon were still working. I would have thought it relevant to consider the findings of the CT scan in the context of the objective evidence of his employment at the time. It seems to me to be concerning that Dr Sharwood could so readily dismiss the matter out of hand. Moreover, it is somewhat troubling, and erodes what confidence I might otherwise have in his opinion, that Dr Sharwood presents his conclusion on the ultimate issue as an ipse dixit.
Dr Christian saw Mr Sheldon in May 2013, again for the purposes of a medico-legal report. He expressed the view, with logical reasons to explain it, that Mr Sheldon was capable of working at least 10 hours per week as a backhoe driver. I prefer his opinion to that of Dr Sharwood.
In considering the application of s 24(1)(b) of the Act I am required to have regard to the matters in s 28. Paragraph (a) requires me to have regard to the skills, qualifications and experience of Mr Sheldon. It has been said that the purpose of that paragraph,
…is to direct attention to the range of employment opportunities available to the individual, but for his or her disability.[6]
In the same case the Court said of paragraphs (b) and (c) of s 28 of the Act,
Section 28(b) focuses attention upon the range of employment opportunities that a hypothetical person with the skills, qualifications and experience referred to in s 28(a) might reasonably undertake. Section 28 (c) requires the Commission to consider the extent to which the impairment actually suffered by the veteran in consequence of the war-caused injury or disease has reduced the veteran's capacity to undertake the "kinds of remunerative work" considered to be available under the test formulated in s 28(b).
[6]Chambers v Repatriation Commission (1995) 55 FCR 9, 20.
Mr Sheldon's skills and qualifications are as a backhoe operator and his experience is entirely in that area. His evidence was that as a self-employed backhoe operator he was able to confine himself to that role and was not expected to work outside that narrow field. He was neither required nor expected to do manual labour associated with the plumbing work on which he was undertaking the backhoe work. All that changed when he sold his backhoe and became, in effect, an employee. He described the situation that then prevailed in this way in his evidence to the Veterans’ Review Board: [7]
When – when I – basically, it was a machine hire company that I worked for. There was very little requirement to hop off the machine and do the work. But when I sold the machine and went to work with the plumber, he has a requirement. But all the civil – civil people basically force you to do manual labour as well. It's – it's – it's – the whole scene out there is changing all the time. Whereas before you could just operate a machine; they don't want that any more. You've got to be – they call it multi-task, and you have to hop off on the ground. They put a lot of concrete in the front buckets and that. A lot of this is to do with that the excavator has – technology has changed – the excavators come and the backhoes have become the support machines. So once you went into the supporting role instead of the front-line role the physical labour has come in.
The evidence does not permit a finding that Mr Sheldon possessed skills, qualifications or experience that would have allowed him to undertake work outside the role of backhoe operator. I appreciate that a narrow approach ought not be taken to the construction of s 28(a) and (b) of the Act but Mr Sheldon appeared to have made a conscious choice to limit the ambit of the work he performed. No doubt he had some expertise that would have permitted him, absent his disabilities, to perform some manual labouring tasks however I am not satisfied that the hypothetical person with his skills, qualifications and experience would have been able to undertake remunerative work outside of backhoe operating.
[7]Exhibit 8, page 24, lines 35-45.
The evidence of Dr Christian, which I accept, is that Mr Sheldon was capable of performing the kinds of remunerative work that a person with a backhoe operator’s skills, qualifications and experience might reasonably undertake. The evidence does not satisfy me that his war-caused conditions reduced his capacity to undertake work as a backhoe operator. Thus, I am not satisfied that Mr Sheldon is, or was during the assessment period, totally and permanently incapacitated as that expression is used in s 24(1)(b) of the Act.
That conclusion is sufficient to dispose of the matter and require that the Commission's decision be affirmed however I will deal, albeit briefly, with the s 24(1)(c) question against the possibility that my earlier conclusion is affected by an error of law.
In considering the question that arises under s 24(1)(c) of the Act I am,
…required to take into account any factor that plays a part or contributes to a veteran's being prevented from continuing to engage in remunerative work.[8]
The section focuses upon whether there are reasons, other than Mr Sheldon's war-caused conditions, that have prevented him from continuing to undertake remunerative work that he was undertaking. In my judgement there were such reasons. I accept, as the Commission submits, that the fundamental cause was Mr Sheldon's decision to sell his backhoe and become, in effect, an employee. From that time on he could no longer work in the way that he had for many years. He was obliged to perform, or to attempt to perform, work that he had been able to avoid in the past. But, in the opinion of Dr Christian, he remained able to continue to undertake the work of backhoe operator. It was that work, back hoe operator solely, that Mr Sheldon was undertaking. His war-caused conditions did not prevent him from continuing that work because he remained capable of doing it.
[8]Repatriation Commission v Hendy [2002] FCAFC 424; (2002) 76 ALD 47 at [37].
I am then of the view that the s 24(1)(c) question must be answered adversely to Mr Sheldon.
Mr Black accepted that the decision of Gordon J in Smith v Repatriation Commission[9] meant that Mr Sheldon could not rely on the ameliorating provisions in s 24(2)(b) of the Act. But I consider that, in any event, the section does not assist Mr Sheldon. It requires the veteran to have been "genuinely seeking to engage in remunerative work". At the highest for Mr Sheldon he appears to have made enquiries with two potential employers in the week that he ceased working but he has not otherwise demonstrated that he was seeking to engage in remunerative work. I do not regard those efforts as amounting to a genuine attempt to engage in remunerative work.
[9][2012] FCA 1043.
It follows that the decision under review ought be affirmed.
I certify that the preceding 22 (twenty -two) paragraphs are a true copy of the reasons for the decision herein of Deputy President PE Hack SC ........................................................................
Associate
Dated 17 April 2014
Date(s) of hearing 19 March 2014 Counsel for the Applicant Mr M Black Solicitors for the Applicant KCI Lawyers Advocate for the Respondent Mr G Purcell, Department of Veterans' Affairs
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