McCormack and Repatriation Commission
[2008] AATA 670
•1 August 2008
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2008] AATA 670
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N 2006/1597
VETARANS’ APPEALS DIVISION ) Re GERALD MCCORMACK Applicant
And
REPATRIATION COMMISSION
Respondent
DECISION
Tribunal Senior Member M D Allen
Dr M E C Thorpe, MemberDate1 August 2008
PlaceSydney
Decision The Decision under Review is SET ASIDE and the Tribunal substitutes in lieu thereof its decision, viz. THAT this matter be remitted to the Respondent with the Direction that the Applicant is entitled to pension at the Special Rate as per section 24 of the Veterans Entitlement Act 1986
as and from the 30th day of March 2005.
..................[sgd]...................
M D Allen
Presiding Member
CATCHWORDS
VETERANS’ ENTITLEMENTS – review of decision by respondent affirmed by veterans’ review board that applicant not entitled to pension at special rate – whether veterans loss of remunerative work is attributable to applicant’s service-related incapacities – alone test – whether applicant could attract an employer to employ him to do work for which applicant’s skills and experience are suited – civil standard of proof – decision under review affirmed
LEGISLATION
Veterans’ Entitlements Act 1986 sections 19, 24, 28 and 120(4)
CASE LAW
Repatriation Commission v Smith (1987) 15 FCR 327
Chambers v Repatriation Commission (1995) 36 ALD 207
Re Davis and Repatriation Commission (1986) 12 ALD 483
Re Martin (KF) and Repatriation Commission (1987) 13 ALD 83
Cavell v Repatriation Commission (1988) 9 AAR 534
Repatriation Commission v Braund (1991) 23 ALD 591
Repatriation Commission v Bowman (1981-82) 38 ALR 650
REASONS FOR DECISION
1 August 2008 Senior Member M D Allen
Dr M E C Thorpe, Member1. In these proceedings the Applicant sought review of a decision by the Respondent as affirmed by a Veterans' Review Board that he was not entitled to pension at the Special Rate pursuant to section 24 Veterans’ Entitlements Act 1986.
2. Section 24 VEA reads inter alia:
“Special rate of pension
(1) This section applies to a veteran if:
(aa) 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
(aab) the veteran had not yet turned 65 when the claim or application was made; and
(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
(ii) the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and
(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
(d) section 25 does not apply to the veteran.
(2) For the purpose of paragraph (1)(c):
(a) 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; and
(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.”
3. In considering the Applicant’s claim the standard of proof mandated by s 120(4) VEA is that to the Tribunal’s “reasonable satisfaction”. In Repatriation Commission v Smith (1987) 15 FCR 327 the Full Court of the Federal Court equated that to the civil standard of proof namely proof on the balance of probabilities.
4. On 30 June 2005 the Applicant made a claim to have the condition described by him as “nervous disorder” attributed to his war-service. On 14 February 2006 a delegate of the Respondent determined that the disease of Post Traumatic Stress Disorder was war-caused and that the Applicant was entitled to pension at 100 per cent of the General Rate for incapacity suffered by him as a result of all his war-caused injuries and diseases. That determination was affirmed by a Veterans' Review Board on 30 August 2006.
5. The Applicant has as a result of his war-service the following injuries and diseases, namely:
i)Internal derangement left knee
ii)Hypertension with hypertensive heart disease
iii)Chronic glomerulonephritis
iv)Chronic solar skin damage
v)Bilateral sensorineural hearing loss
vi)Lumbar spondylosis
vii)Metatarsalgia of the left foot
viii)Post traumatic stress disorder
ix)Depressive disorder.
6. There are other injuries and diseases suffered by the Applicant which are not recognised as being war-caused. The Respondent did not in these proceedings submit that these injuries and diseases contributed to the Applicant’s inability to obtain remunerative work. We agree that the Applicant’s non war-caused injuries and diseases do not impinge upon his ability to undertake remunerative work which he might be expected to undertake in terms of s 28 VEA.
7. Section 28 VEA states:
“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).”
8. As was pointed out by Davies J in Chambers v Repatriation Commission (1995) 36 ALD 207 at 210:
“In paras (a) and (b) attention is directed to the skills, qualifications and experience of the veteran for the purpose of determining the kinds of remunerative work which a person with those skills, qualifications and experience might reasonably undertake. That ambit of capacity for remunerative work is then the starting point from which the degree of reduction in work capacity by reason of the physical or mental impairment of the veteran is measured. As Moore and Sackville JJ point out, (a) and (b) should be applied not technically or restrictively but sensibly and fairly with a view to ascertaining the kinds of remunerative work which the veteran might reasonably undertake absent the war-caused injury or disease. Work experience is a guide but it does not limit that ambit.
Necessarily, in the examination of the matters which arise under para (c), matters other than skills, qualifications and experience are taken into account. Every fact which bears upon the nature and extent of the physical and mental impairment of the veteran must be taken into account. And so also must every fact which bears on the extent to which the physical or mental impairment has reduced the veteran’s capacity to undertake remunerative work of the kind which the veteran might reasonably undertake.”
9. The Applicant retired from the Australian Regular Army on 17 August 2000 at the age of 55. At the time of his retirement he held the rank of Colonel and had over 37 years service in the Army. His qualifications at that time were that he was a Graduate of the Australian Royal Military College, the British Army Staff College and the Australian Joint Service Staff College. His “civilian” qualifications are a BA, (Commerce) from the University of Queensland, a graduate of the Company Directors Course from the Australian Institute of Management and a Graduate of the Small Business Course at the University of New England. He has also completed training in Industrial Relation and Human Rights and Equal Opportunity with the Australian Counsel of Trade Unions.
10. During his military career the Applicant occupied important staff and diplomatic positions. These included: Commanding Officer of the 1st Armoured Regiment; Commanding Officer of the Land Warfare Training Centre Canungra, Queensland; Chief of Operations at Army Training Headquarters; Director of Personnel Policy at Army Headquarters, Canberra; Chief of the Australian Delegation to the UN Command, Korea; and Defence Attaché to the Australian Embassy, Korea. He completed his military career as Defence Attaché to the Australian Embassy in Germany.
11. Given his education and the positions held by him we find that the kind of remunerative work that the Applicant might reasonably undertake is that at a senior executive level.
12. As was quite properly pointed out by the Respondent in submissions there is a considerable difference between working at the level the Applicant was working and employment as for example a clerical assistant. The matter was well put by Senior Member Sir William Prentice in Re Davis and Repatriation Commission (1986) 12 ALD 483 at 484 namely:
“Thus a veteran doctor rendered voiceless could not reasonably be thought capable of undertaking a job as a window cleaner, or a veteran barrister rendered voiceless that of a gate keeper.”
See also the discussion in Re Martin (KF) and Repatriation Commission (1987) 13 ALD 83 at 93 paras 40 at 41.
13. Following his retirement from the Army in August 2000 the Applicant applied for and obtained a senior executive position with Australasian Correctional Management Pty Limited. That company held a contract from the Australian Government to manage Immigration Detention Centres and the Applicant’s position was that of General Manager of Detention Services.
14. Prior to gaining that position the Applicant had to undergo a psychological assessment conducted for the company by a recruitment firm Morgan & Banks. Although the Applicant generally scored well in this testing he rated poorly under the criteria of “interpersonal sensitivity” and a criticism was made of him that he “tends to be emotionally expressive and may be prone to the odd inappropriate outburst. Others are likely to be aware when he is feeling especially stressed or upset”. We find these comments relevant to the later diagnosis of PTSD.
15. Initially the Applicant coped well in his civilian position and at the end of the first year he received a substantial bonus.
16. By September, October 2002 however an inter-union dispute developed between the Australian Workers Union and the Miscellaneous Workers Union regarding membership at the Port Headland Detention Centre. As a result of this inter-union conflict staff at the Port Headland Detention Centre went on strike and the Applicant transferred from Head Office in Sydney to more effectively manage that strike.
17. The Applicant states that at this time he was suffering headaches, nausea, was unable to sleep and when he did sleep, he had images of dead and wounded. Ultimately the dispute was resolved after the Managing Director of ACM together with a legal representative arrived at Port Headland and began direct negotiations with the Unions. At the time the Managing Director arrived at Port Headland the Applicant was returned to Sydney for three days leave.
18. Upon returning to his office in Sydney after leave, the Applicant was told by his Managing Director that he had not handled the events at Port Headland well and his resignation was required. He resigned that day namely the 11th of October 2002.
19. In December 2002 the Applicant applied for a position with SERCO the private company that provides administrative facilities to defence force bases. He was interviewed for the position being on a short list of three, but did not get the appointment.
20. In February 2003 the Applicant applied for a position as the Security Officer for Qantas. He was told in April 2003 that an internal restructuring had taken place and that the position for which he had applied had been subsumed into the operations officer’s tasks.
21. The Applicant agreed that both the above positions were senior management roles. Questioned about his state of health at the time of applying for the above positions the Applicant said that he felt able to do them.
22. Having failed to obtain either the SERCO position or the position with Qantas the Applicant has not sought any other employment.
23. Questioned about his capacity to enter into employment in 2002 as opposed to later especially in 2005 when diagnosed with PTSD, the Applicant stated that by 2005 he would have had great difficulty working because of his inability to concentrate, to plan and to do the things he thought he was quite good at. He had been brought to a halt by the events at Port Headland which now indicates to him that he was attempting to function at an unsustainable level.
24. It was not until the Applicant was referred by his General Practitioner to Psychiatrist, Dr Altman, following an event when he consulted his GP feeling “hyped up” as a result of time stresses being imposed upon him in taking his brother-in-law to the airport that a diagnosis of PTSD was made. Both Dr Altman and Dr Dinnen, Psychiatrists, are of the opinion that the clinical onset of the Applicant’s PTSD was in the 1970’s shortly after his return to Australia following a second period of Operational Service in South Vietnam.
25. In his report of 6 June 2005 to the Applicant’s GP Dr Altman states inter alia:
“In summary, in my opinion as a result of his Vietnam war experience Mr McCormack suffers from a severe chronic Post-traumatic Stress Disorder with an associated Major Depression… Furthermore in my opinion as a result of the above mentioned psychiatric disorders alone he is totally and permanently unfit to work and in my opinion he should be placed on the “T & PI” Disability Pension. In my opinion he is not well enough to work eight or more hours a week.”
26. On 28 November 2005 Dr Altman gave a further report to the Department of Veterans’ Affairs. He had been asked by the DVA: “When did the PTSD become clinically significant?” and replied in his report:
“…I cannot give an exact date of the onset of his Major Depression - although it is secondary to his Post-traumatic Stress Disorder and therefore would have started after his return from Vietnam. He has been suffering from depression intermittently over the years following his return from Vietnam. When I assessed him earlier this year his Major Depression was severe. Once again, I cannot give an exact date as to when his Post-traumatic Stress Disorder became clinically significant as I have not been able to contact him to establish this date. However, it is likely that his Post-traumatic Stress Disorder became clinically significant in the early 1970’s as this was for example when his nightmares began. His Post-traumatic Stress Disorder has gradually deteriorated over the years to the point where it is severe at present. In terms of him suffering from panic attacks, when I last saw Mr McCormack in September 2005 he stated he was experiencing panic attacks and I gave him treatment for this. These panic attacks are also an associated condition, or secondary condition or comorbid to the main diagnosis which is a Post-traumatic Stress Disorder…”
27. Dr Dinnen in his report of 13 April 2007 places the clinical onset of the Applicant’s PTSD as being in 1971/72 and states: “It has continued since that time”.
28. Dr Dinnen was firmly of the opinion that the Applicant’s PTSD affected his ability to engage in employment at the time of his forced resignation from ACM in 2002 and there after.
29. Cross-examined regarding the fact that the Applicant had applied for a position with SERCO soon after being forced to resign from ACM Dr Dinnen stated that he would not draw any psychiatric conclusion from the fact that he applied, what would have been relevant was if he had obtained the position and was found not to be able to function.
30. To our mind Dr Dinnen’s evidence countered the submissions by the Respondent that the success of the Applicant’s military career mitigated against a clinical onset of PTSD in the 1970s. As Dr Dinnen pointed out the fact a person is adequately functioning in a number of areas does not exclude psychiatric illness.
31. The Applicant stated that whilst in the Army he had dealt with his PTSD symptoms by being meticulous and by planning ahead. Dr Dinnen pointed out that for the Applicant the Army provided a secure environment. As the Applicant stated in evidence that he was unable to handle the inter-seeing Union conflict at Port Headland because events were changing rapidly and he was unable to predict anticipate and have plans for actions.
32. Dr Roberts, Psychiatrist, examined the Applicant on behalf of the Respondent. In the opinion of Dr Roberts it is more than probable that the Applicant does not suffer from PTSD. One of the reasons given by Dr Roberts for this conclusion is that the Applicant stated to Dr Dinnen that he did not think that his operational experiences had traumatised him.
33. Exhibit R10 in these proceedings is an article referred to and relied upon by Dr Roberts by researcher and Psychiatrist Phillip Resnik entitled “Malingering and Posttraumatic Disorders”. In that article Resnik states:
“A person who has always been a responsible and honest member of society is not likely to malinger post traumatic stress disorder. Malingerers are more likely to be marginal members of society with few binding lives or wrong standing financial responsibilities such as home ownership. The malingerer may have a history of spotty employment, previous incapacitating injuries, and extensive absences from work. Malingerers frequently depict themselves and their prior functioning in exclusively complimentary terms.”
To our mind this passage when compared to the history of the Applicant shows that his background is the antithesis of the malingerer. Resnik also adds: “Veterans with true posttraumatic stress disorder are more likely to downplay their combat experience” and this fits with Dr Dinnen’s report that the Applicant told him he did not think he had been traumatized by his combat experiences.
34. In our opinion the material relied upon by Dr Roberts to support his opinions in fact disproves them. Further we are satisfied that the whole tenor of Dr Roberts’ evidence has been influenced by his scepticism regarding the Applicant’s PTSD and we prefer the opinions of Drs Altman and Dinnen as to the Applicant’s psychiatric state.
35. Notwithstanding our preference for the opinions of Drs Altman and Dinnen s 24(1)(c) VEA requires that incapacity from war-caused injury or disease be the sole cause of a Veteran’s inability to undertake remunerative work. As Burchett J said in Cavell v Repatriation Commission (1988) 9 AAR 534 at 539 the task of the Tribunal in considering the “alone” test 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 that should not be made upon nice philosophical distinctions, but with an eye to reality, and as a matter in respect of which common sense is the proper guide.”
36. The Applicant made his application to have PTSD recognized as a war-caused disease on 30 June 2005. That date is the “application day” and it is from that time the Applicant’s entitlement to Pension at the Special Rate is to be considered (see s 19 VEA).
37. As was pointed out by Pincus J in Repatriation Commission v Braund (1991) 23 ALD 591 at 595 it is not a matter of assessing an Applicant’s incapacity to undertake remunerative work at the time he retired from the workforce even though that retirement was brought about by war-caused incapacity but assessing his ability to undertake remunerative work at the application day.
38. There is no dispute the Applicant has qualifications suiting him for employment at a senior executive level and that we are concerned with his ability to undertake remunerative work in this area of employment. Our task is to assess the effect of his mental disability upon his ability to be employed and earn remuneration as a senior executive. The psychiatric evidence from Dr Altman was that he reported Mr McCormack as totally unfit for work. Dr Dinnen opined Mr McCormack’s capacity was affected by his PTSD and that “I don’t believe that his condition would allow him to discharge the duties in a managerial position”. We preferred the opinions of Dr Altman and Dr Dinnen to Dr Roberts who questioned the diagnosis of the accepted disabilities PTSD and depression.
39. Pursuant to subsection 24(2)(b) of the VEA the “alone” test requires the incapacity to be the substantial cause of his or her inability to obtain remunerative work. There was no material before the Tribunal involving other accepted disabilities or non-accepted disabilities contributing to his employability. This is a difficult task as we are concerned with a senior executive with a mental incapacity, who can take part in normal social activities, but is unable to work as a senior executive. We are not concerned with his ability to work in a lesser position.
40. Mr McCormack was unable to handle the work at Port Hedland in 2002 and we accept the Applicant’s PTSD contributed to his failings and thus his enforced resignation. There is evidence that shortly thereafter the company that employed him was placed in liquidation. Mr McCormack’s statement indicated the company changed its name and continued to operate and that his General Manager position remained in place. His account was that when the pressure from the industrial action increased so did his panic attacks, his feeling shame, irritability, inability to concentrate and then to think problems through. This would support the proposition he was unable to handle the position.
41. The medical evidence from Dr Dinnen and Dr Altman was that the PTSD was present prior to 2002 and has continued up to and past the date of application. The panic attack in 2005 precipitated formal recognition of the mental condition as PTSD by Dr Altman. The Applicant’s evidence was that lack of attempts to obtain further work since April 2003 was because of his accepted condition. A market was reasonably available to the Applicant (Bowman (supra)) and as pointed out in Smith (supra):
“The Tribunal must attempt an assessment of what the Respondent probably would have done if he had none of his service disabilities. The starting point is an examination of the prospects of employment, including self employment.”
42. With regard to s 24 VEA, it could be argued there were reasons other than his mental incapacity preventing him from working. Senior executive positions are not as readily available as less responsible skilled ones and employers would no doubt favour an applicant with a proven history of work at a corporate executive level as opposed to the Applicant’s military experience. Added to these very generalised factors is that at the application day the Applicant was aged 60 years, an age at which many executives are reaching or contemplating retirement, and the Applicant had effectively been out of the work force for two and a half years.
43. Notwithstanding these factors the psychiatric evidence available to the Tribunal is that the PTSD alone was the substantial cause preventing Mr McCormack from discharging his duties in a managerial position. If Mr McCormack did not have the war-caused disability of PTSD, he probably would have continued in employment as a senior executive. As he did have a psychiatric war-caused disability sufficient to allow him not to be able to discharge the duties of a managerial position and as no other service or non-service disability was impinging on his work capacity and as he was aged 60 at the time of application, other reasons as propounded by the Respondent including the job market do not qualify any other reason other than his psychiatric disability for Mr McCormack not being able to engage in remunerative work.
44. For these reasons the Decision under Review is set aside and this matter remitted to the Respondent with the Direction that the Applicant is entitled to pension at the Special Rate as per s 24 of the VEA as and from the 30th day of March 2005.
I certify that the 44 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member M D Allen and Dr M E C Thorpe, Member
Signed: [sgd] [sgd] .....................................................................................
Mwela Kapapa, AssociateDate/s of Hearing 3 December 2007, 14 March 2008 and
24 June 2008
Date of Decision 1 August 2008
Counsel for the Applicant Mr M Perry
Solicitor for the Applicant KCI Lawyers
Solicitor for the Respondent Department of Veterans’ Affairs
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