Local Government Superannuation Board v Thorne - [2002] FCA 848

FEDERAL COURT OF AUSTRALIA
Local Government Superannuation Board v Thorne [2002] FCA 848
ADMINISTRATIVE LAW - review of decision of Superannuation Complaints Tribunal - whether the decision of the Tribunal was consistent with the proper construction of the rules of the superannuation scheme - whether Tribunal erred in not finding the respondent's complaint related to the management of the superannuation scheme as a whole - whether decision of Tribunal required the applicant as trustee of a superannuation scheme to do something contrary to the governing Rules of the scheme - whether the Tribunal erred in 're-writing' the respondent’s complaint.
SUPERANNUATION – transfer of member between superannuation schemes – whether member entitled to payment from new scheme equivalent to bonus accumulation paid by old scheme pursuant to a change in the rules in the old scheme subsequent to the member’s transfer – construction of rules of statutory scheme.
Superannuation (Resolution of Complaints) Act 1993 (Cth), ss 14, 37, 46
Superannuation Industry (Supervision) Act 1993 (Cth), ss 103-105, 111-113, 130
Local Government Act 1934 (SA) ss 73, 74, 75, 76, 78, 157a (repealed), 157b (repealed)
Local Government Act Amendment Act 1984 (SA)
Local Government Act Amendment Act (No. 3) 1984 (SA)
Briffa v Hay (1997) 75 FCR 428 - referred to
Wilkinson v Clerical, Administrative and Related Employees Superannuation Pty Ltd (1997) 79 FCR 469 - referred to
Lykogiannis v Retail Employees Superannuation Pty Ltd (2000) 97 FCR 361 - referred to
National Mutual Life Association of Australia Ltd v Campbell (2000) 99 FCR 562 - referred to
Haematite Pty Ltd as Trustee for the BHP Superannuation Fund v Ristevski [2002] FCA 408 - referred to
Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 – discussed
Lock v Westpac Banking Corporation (1991) 25 NSWLR 593 – referred to
Scully v Commissioner of Taxation (1990) 84 FCR 41 – referred to
Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99 – referred to
LOCAL GOVERNMENT SUPERANNUATION BOARD v RAYMOND EDWARD THORNE
S 216 of 2001
MANSFIELD J
ADELAIDE
3 JULY 2002

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

S 216 OF 2001

BETWEEN:

LOCAL GOVERNMENT SUPERANNUATION BOARD
APPLICANT

AND:

RAYMOND EDWARD THORNE
RESPONDENT

JUDGE:

MANSFIELD J

DATE OF ORDER:

3 JULY 2002

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
1.The application is allowed.
2.The order of the Superannuation Complaints Tribunal made on 18 November 2001 is set aside.
3.The decision of the Local Government Superannuation Board be reinstated, to the effect that the benefits to which Raymond Edward Thorne is entitled under the Local Government Superannuation Scheme upon his retirement from employment with the Corporation of the City of Adelaide do not include a payment equivalent to that to which he would have become entitled had he remained a member of The Corporation of the City of Adelaide Superannuation Plan upon the 1996 resolution of its trustee to distribute excess funds partially to its members at that time.

Note: Settlement and entry of orders…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2002] FCA 848
Decision Date: 3 JULY 2002

CaseChat Overview and Summary

In the case of Local Government Superannuation Board v Thorne, the respondent, Raymond Edward Thorne, brought a complaint to the Superannuation Complaints Tribunal regarding his retirement benefits under the Local Government Superannuation Scheme. Thorne argued that he had been financially disadvantaged upon transferring from The CCA Plan to the Scheme. Specifically, he contended that he should have received benefits equivalent to those distributed to members of The CCA Plan in 1996 or that he should have been allowed to participate in the Bonus Multiple distributions made by the Scheme in 1994 and 1997. The Superannuation Complaints Tribunal ruled in Thorne's favour, concluding that he was entitled to benefits equivalent to those distributed by The CCA Plan in 1996 but rejected his claim to participate in the Bonus Multiple distributions.

The primary legal issue before the court was whether the Tribunal's decision correctly interpreted the terms of the Trust and the Scheme in relation to the respondent's entitlements. The court examined the provisions of the Trust Deed, particularly Clause 21, which connects the respondent's employment to the receipt of benefits. The court found that the terms of the Trust Deed, rather than any statements in a booklet, determined the respondent's entitlements. It held that Clause 21 entitled the respondent to receive benefits from the Fund in accordance with the provisions of his previous Fund, meaning he was entitled to the equivalent benefit from the Fund if his previous Fund had been amended to provide for the distribution of surplus allocation. However, the court also found that the respondent, as an Old Benefit Member, was limited to receiving benefits payable under the former Fund, excluding him from the 1994 and 1997 Bonus Multiple distributions.

The court set aside the Tribunal's order and reinstated the decision of the Local Government Superannuation Board, which determined that the respondent was not entitled to benefits equivalent to those he would have received had he remained a member of The Corporation of the City of Adelaide Superannuation Plan in 1996. The court's decision clarified the interpretation of the Trust Deed provisions and the respondent's entitlements under the Scheme, providing a definitive resolution to the dispute regarding his retirement benefits.

Orders

Orders of the court

1. The application is allowed.

2. The order of the Superannuation Complaints Tribunal made on 18 November 2001 is set aside.

3. The decision of the Local Government Superannuation Board be reinstated, to the effect that the benefits to which Raymond Edward Thorne is entitled under the Local Government Superannuation Scheme upon his retirement from employment with the Corporation of the City of Adelaide do not include a payment equivalent to that to which he would have become entitled had he remained a member of The Corporation of the City of Adelaide Superannuation Plan upon the 1996 resolution of its trustee to distribute excess funds partially to its members at that time.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

MANSFIELD J

Following his retirement on 28 August 1998, the respondent complained to the Tribunal. He identified the complaint as concerning a decision of the trustee (the applicant) of the Scheme:“which he claims financially disadvantaged him contrary to an undertaking given that he would not be financially disadvantaged upon transferring”from The CCA Plan to the Scheme. He complained that the applicant:·had not provided him with a benefit equivalent to that paid from the excess distribution made by The CCA Plan to its then members in 1996; or alternatively·had excluded him from participating in the Bonus Multiple distributions made by the Scheme in 1994 and 1997. THE TRIBUNAL’S DECISION The Tribunal concluded that the respondent is entitled to receive under the Scheme a benefit equivalent to that paid to members of The CCA Plan in 1996 from the excess distribution made to the then members of The CCA Plan. It rejected his claim to be entitled under the Scheme to participate in the 1994 and 1997 Bonus Multiple distributions. The Tribunal’s reasoning for its conclusion is contained in the following passage:“As is pointed out in the 1984 booklet, it is the terms of the Trust which are to be determinative not statements contained in the booklet. Clause [sic Rule] 21 is clearly intended to have broad application commencing as it does with the words ‘Notwithstanding anything else contained in these Rules …’ The Clause connects the Complainant’s employment in the service of the Council which employed him as at 30 June 1984 to the receipt of benefits. The words sought to be emphasised by the Trustee from the pamphlet, namely that the benefits were limited to those applying as at 30 June 1984, is not reflected in the words of the Trust Deed and consequently is irrelevant for consideration.Clause 21 entitles the Complainant to receive benefits from the Fund ‘… in accordance with the provisions of his previous Fund’. If as appears to be the case here, the previous Fund was amended in or about 1996 to provide for the distribution of surplus allocation, then there is no reason why the Complainant should not receive the equivalent benefit from the Fund. There is no reason to limit the distribution of benefits only to those benefits which may have accrued as at 30 June 1984, even if this was not the Trustee’s intention. This is so particularly given that the Complainant continued to pay contributions between 30 June 1984 and his date of retirement in August 1998.Clause 21 limits the Complainant as an Old Benefit Member to receive those benefits which are payable under the former Fund. Accordingly, in the opinion of the Tribunal, he has no entitlement to receive the bonus benefits payable by the Fund in 1994 and 1997. This contrasts to those Members of the former Fund who on transfer to the Fund elected to receive the benefits provided by the Fund rather than retain the benefits provided by the former Fund. The definition contained in Clause 2 of ‘Old Benefit Member’ limits the Complainant from participating in the benefits paid by the Fund.”The third paragraph of those reasons concerns the claim that the respondent should have been entitled to participate in the Bonus Multiple benefits paid by the Scheme in 1994 and 1997. It is unnecessary to address whether the Tribunal correctly decided that issue. Its decision in that regard has not been challenged by the respondent by way of cross appeal or cross contention.

Ratio Decidendi

Legal Principle Established

Established by: MANSFIELD J

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	S 216 OF 2001

BETWEEN:	LOCAL GOVERNMENT SUPERANNUATION BOARD APPLICANT
AND:	RAYMOND EDWARD THORNE RESPONDENT
JUDGE:	MANSFIELD J
DATE OF ORDER:	3 JULY 2002
WHERE MADE:	ADELAIDE