McMullen v Commissioner for Superannuation

[1985] FCA 143

Re: ROBYN McMULLEN
And: COMMISSIONER FOR SUPERANNUATION
No. ACT G 27 of 1984
Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY
DISTRICT REGISTRY
GENERAL DIVISION
Fisher J.
Gallop J.
Neaves J.

CATCHWORDS

Administrative Law - Appeal from Administrative Appeals Tribunal - Reference in decision of Tribunal to medical publications not put to the parties, their advisers or expert witness - Whether a denial of natural justice.

Superannuation - Eligible employee - Invalidity retirement before maximum retiring age - Less than 20 years' service - False information furnished in connection with medical examination for entry to Superannuation Fund under Superannuation Act 1922 - Whether benefit classification certificate properly issued under sub-s.185(4) of Superannuation Act 1976 - Whether "paranoid personality" a mental condition - Whether retirement substantially contributed to by that condition.

Statutory Interpretation - Interpretation so as to avoid absurdity and to enable provision to operate effectively and in accordance with legislative intention.

Constitutional Law - Acquisition of property on just terms - Whether superannuation legislation properly characterised as a law with respect to acquisition of property by any person for a purpose in respect of which the Parliament has power to make laws - Whether eligible employee had a right of property which was acquired by the legislation - Constitution, s.51(xxxi).

Law Reform - Drafting defects in s.184 of Superannuation Act 1976.

Administrative Appeals Tribunal Act 1975, s.33

Superannuation Act 1922, ss.5, 38, 48B

Superannuation Act 1976, ss.16, 66, 184

Superannuation Acts Amendment Act 1978, s.77

HEARING

CANBERRA
#DATE 16:4:1985

ORDER

1. The application be dismissed.

2. The applicant pay the costs of the respondent of and incidental to the application.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is an appeal pursuant to sub-s.44(1) of the Administrative Appeals Tribunal Act 1975. That sub-section enables a party to a proceeding before the Administrative Appeals Tribunal ("the Tribunal") to appeal to this Court, on a question of law, from any decision of the Tribunal in that proceeding. Robyn McMullen ("the applicant") has appealed against a decision of the Tribunal given in proceedings by way of review of a decision of the respondent, the Commissioner for Superannuation ("the Commissioner"), made under the Superannuation Act 1976 ("the Act"). Although the Tribunal agreed in substance with the Commissioner's decision it set aside his decision and substituted a decision in accordance with its findings.

1. The Tribunal decided -
   
   

(a) to issue in respect of the applicant a benefit classification certificate pursuant to sub-s.184(5) of the Act specifying the conditions "History of nervous disorder, namely anxiety state; paranoid personality"; and

(b) in accordance with paragraph 66(2)(c) of the Act, that the incapacity which was the ground for the retirement of the applicant was substantially contributed to by the mental condition specified in the benefit classification certificate, namely paranoid personality.

The effect of this decision was to reduce the benefits that would otherwise have been payable under the Act to the applicant upon her retirement.

1. The applicant commenced employment as a Clerical Assistant, Grade 1, with the Department of Health on 28 September 1970. At that time she was a married woman 31 years of age with four young children aged respectively 12, 10 (twins) and 6. She had been admitted to Canberra Hospital for the period 21 September to 3 October 1967. From 21 September to 26 September 1967 she was in M Ward (the Psychiatric Ward) from which she was discharged on the latter date to return to her home. On the following day she was re-admitted for further treatment. The final diagnosis recorded on her admission summary was "anxiety state".

2. On 27 July 1972 she underwent a medical examination in connection with which she was required to answer a number of questions concerning her previous medical history. This examination was not only for the purpose of determining her fitness for permanent appointment to the Commonwealth Public Service (as it was then called). It was also conducted for the purpose of determining whether her health and physical fitness were such as to justify her acceptance as a contributor to the Superannuation Fund or the Provident Account established by the Superannuation Act 1922-1971. She was in fact accepted as a contributor to the Superannuation Fund.

3. The relevant questions and the answers given by the applicant at the time of her examination were as follows -
   
   

"PERSONAL

Have you now or have you previously had any of the following conditions?

Answer 'YES' or 'NO' in space provided.

NOTE: All questions must be answered.

1 (a)Nervous fatigue No (g) Persistent headaches No

(b)Mental or nervous (h) Dizziness or turns No

conditions No

(c) Anxiety state No (i) Attack of unconscious-

ness or weakness No

(d)Neurasthenia No (j) Migraine No

(e) Fits No (k) Disturbance of

sensation or muscular activity No

(f)Epilepsy No (l)Persistent

breathlessness No"

1. The decisions of the Commissioner and the Tribunal were based on these negative answers. The Tribunal also attached significance to the fact that the applicant failed to make any reference to her previous history of a nervous condition. However it was ultimately accepted that, having answered each of the above questions in the negative, the applicant was under no obligation to make further reference to her previous history and her failure to do so did not amount to a default under the relevant statutory provisions: see Fry v. Commissioner for Superannuation (Federal Court of Australia, Full Court - 31 July 1984 - unreported), a decision delivered after the Administrative Appeals Tribunal had given its decision in the present case. The Tribunal was of opinion, as was the Commissioner, that the applicant's negative answer to each of the first three questions was false.

2. In December 1977 the applicant suffered an emotional upset in consequence of a decision to transfer her to another section of the Department of Health. Thereafter she had numerous absences from work, in respect of which her general practitioner provided medical certificates describing her condition variously as "emotional upset", "nervous disorder" or "anxiety symptoms". A medical examination conducted by a Commonwealth Medical Officer on 22 March 1979 found that she was unfit for continued employment and should be retired on the ground of invalidity due to "anxiety". The Commonwealth Medical Officer recorded that she had "a history of anxiety neurosis dating back to eighteen months". The necessary steps were taken to retire the applicant on the ground of invalidity from the date when she had last worked, 12 February 1979.

3. Following the applicant's retirement on the ground of invalidity the Commissioner considered whether the provisions of sub-s.184(5) of the Superannuation Act 1976 (being provisions enacted by the Superannuation Acts Amendment Act 1978) were applicable to her circumstances. He concluded that they were applicable and issued a benefit classification certificate accordingly. That decision was confirmed upon reconsideration by the Commissioner under sub-s.154(4) and the confirmed decision was subsequently reviewed by the Tribunal with the result to which reference has already been made.

4. On the hearing of the appeal counsel for the applicant conceded that he must accept the finding of the Tribunal that the applicant had "furnished false information" in connection with her medical examination under the Superannuation Act 1922 (which may, for convenience be referred to, as it is in the Superannuation Act 1976, as "the superseded Act"). His primary submission was that, on its proper construction, sub-s.184(5) had no application to the applicant or to persons in her situation. He put alternative submissions on the basis that his primary submission was not accepted. He contended that the Tribunal had erred in holding that the condition which would have been specified in the benefit classification certificate that the Tribunal was satisfied would have been in force in respect of the applicant immediately before her retirement had she not furnished false information at her medical examination on 27 July 1972 was properly characterised as a "mental condition" within the meaning of that expression in the Act. It was also submitted that, in reaching that conclusion and the further conclusion that the incapacity which was the ground for the applicant's retirement was substantially contributed to by the mental condition so found, the Tribunal proceeded in a manner which denied to the applicant natural justice.

5. The submission that sub-s.184(5), on its proper construction, had no application to the applicant or to persons in the same situation as the applicant involved, inter alia, a submission that the legislative scheme constituted by the Superannuation Act 1976 and the Superannuation Amendment Act 1976 (as amended by the Superannuation Acts Amendment Act 1978) depended in point of constitutional validity, at least in part, on s.51(xxxi) of the Constitution. It was said that to read sub-s.184(5) as applying to the applicant and to persons in a similar situation, would result in the scheme effecting an acquisition of property on other than just terms. It was then said that, in accordance with s.15A of the Acts Interpretation Act 1901, the law should be read so as not to exceed the legislative power of the Commonwealth.

6. Although logically this argument should be considered first, we propose to delay consideration of it until later in these reasons.

7. The provisions of sub-s.184(5) of the Act are central to the arguments presented to the Court. They are, as the Tribunal correctly stated, both complex and obscure and they are in urgent need of re-drafting. It will be necessary to set out the provisions which are relevant to this appeal and then to attempt to understand them and their purpose but before doing so some reference should be made to the legislative history.

8. At the time the applicant was accepted as a contributor to the Superannuation Fund the relevant statutory provisions were contained in the Superannuation Act 1922-1971. The Superannuation Fund, into which were to be paid the contributions of employees accepted as contributors thereto and certain payments by the Commonwealth under the Act, was established by s.8, a provision within Part II. Part III made provision for the payment of contributions by those accepted as contributors to the Fund and by the Commonwealth while Part IV provided for the payment of pensions and other benefits out of the Fund. Section 48B should be noticed. It provided -
   
   

"48B. Where -

(a) within three years after the obligation of a contributor to contribute to the Fund under Part III of this Act came into existence, the contributor dies or is retired on the ground of invalidity or physical or mental incapacity to perform his duties;

(b) the Board is satisfied that the death, invalidity or incapacity was caused, or substantially contributed to, by a physical or mental condition that, to the knowledge of the contributor, existed at the time when he underwent the medical examination referred to in sub-section (1) or sub-section (2) of section five, or sub-section (2) of section seventy-nine, of this Act; and

(c) the contributor did not disclose the existence of the condition to the person who made the examination or made or furnished a false or misleading statement to that person in respect of the condition,

pension is not payable to or in respect of the contributor but there is payable to him or to his personal representatives, as the case may be, an amount equal to the amount of the contributions paid by him under this Act."

1. Section 75 within Part V established the Provident Account into which were to be paid all contributions by employees accepted as contributors to that Account and payments by the Commonwealth under Part V. That Part of the Act also provided for the making of contributions to the Account and for the payment thereout of benefits. The benefits payable out of the Provident Account were lump sum payments calculated, in most cases, by reference to the amount of the contributions to the Account made by the employee. Section 83A made provision in relation to contributors to the Provident Account similar to that made by section 48B in relation to contributors to the Superannuation Fund except that the sum that was payable to a contributor to the Provident Account was an amount equal to the amount of his contributions together with compound interest thereon. Although the Provident Account formed part of the Superannuation Fund (s.75), it is convenient to refer to it as if it were a separate fund.

2. By virtue of s.5 an employee was not permitted to contribute to the Superannuation Fund or the Provident Account unless he had undergone a medical examination as a result of which the Superannuation Board constituted by the Act was satisfied that his health and physical fitness were such as to justify his being accepted as a contributor to the Superannuation Fund or to the Provident Account. Under s.81 a contributor to the Superannuation Fund could, in certain circumstances, elect to become a contributor to the Provident Account instead of to the Superannuation Fund.

3. In 1976 the Superannuation Act 1976 was passed. It came into operation on 1 July 1976 ("the commencing day"). Its purpose was to establish a new superannuation scheme for persons employed by the Commonwealth and for certain other persons. A body by the name of the Superannuation Fund Investment Trust and a Fund to be known as the Superannuation Fund were established (s.28 and sub-s.40(1)). The uninvested moneys of the Fund established by the superseded Act ("the existing Fund") became moneys of the new Fund, the investment assets of the existing Fund became assets of the new Fund and the investment liabilities of the Superannuation Board established under the superseded Act became liabilities of the Superannuation Fund Investment Trust (s.171). Under the new legislation there was nothing corresponding to the Provident Account under the previous legislation.

4. Employees who had been contributors to either the Superannuation Fund or the Provident Account established under the superseded Act and who had not retired before 1 July 1976 became liable to pay contributions in accordance with Part IV of the Superannuation Act 1976 and on their death or retirement benefits were payable in accordance with Part V. The obligation to make contributions under the superseded Act came to an end and any entitlements to pension or other benefits under that Act ceased.

5. To facilitate an understanding of the relevant provisions both of the Superannuation Act 1976 and the amendments made to them by the Superannuation Acts Amendment Act 1978 to which reference will hereafter be made, it is convenient to adopt certain shorthand expressions. The statutory provisions refer to the failure of a person to furnish any information required to be furnished by him and to the furnishing of false information. These two concepts will be referred to compendiously as the furnishing of false information. The provisions also refer, in relation to a person, to "the physical or mental condition or conditions which, in the opinion of the Commissioner, caused, or substantially contributed to, the death or the incapacity which was the ground for his retirement on the ground of invalidity". It will be convenient to shorten that expression to "the condition causing death or retirement".

6. Under the superseded Act persons who, by reason of a physical or mental condition, were considered unlikely to continue as eligible employees until maximum retiring age could be accepted as contributors to the Provident Account with consequentially limited benefits payable on death or retirement. Section 16 of the Superannuation Act 1976, however, introduced the concept of a benefit classification certificate. By virtue of the section a person who, after the commencing day, proposed to become, or became, an eligible employee was to undergo such medical examination as the Commissioner required. The Commissioner was obliged to issue a benefit classification certificate if he was of opinion, after considering the report of the result of such medical examination, that the person was not likely, by reason of or for a reason connected with a physical or mental condition referred to in the medical report, to continue to be an eligible employee until be attained his maximum retiring age. The certificate was to specify the relevant physical or mental condition (sub-s.16(4)). Provision was made for the revocation or variation of such a certificate (sub-s.16(8)).

7. Sub-section 16(10) made provision, in the circumstances there set out, for the issue of a benefit classification certificate after an employee had died or ceased to be an eligible employee by reason of retirement on the ground of invalidity and deemed such certificate to have been in force at the time of the employee's death or retirement. Sub-section 16(11) dealt with the situation where the Commissioner was satisfied that, at or in connection with a medical examination which the person was required to undergo under s.16, the person furnished false information. The sub-section postulated that the person had ceased to be an eligible employee by reason of death or retirement on the ground of invalidity, that his period of contributory service was less than 20 years, that at the time he ceased to be an eligible employee he had not attained his maximum retiring age and that either -
   
   

(a) a benefit classification certificate was not in force in respect of him at the time he ceased to be an eligible employee; or

(b) such a certificate was in force in respect of him at that time but it did not specify the condition causing death or retirement.

In such a case, if the Commissioner was also satisfied that, if the person had not furnished false information, there would have been in force in respect of him a benefit classification certificate specifying the condition causing death or retirement or a physical or mental condition connected with that condition, he was obliged to issue a benefit classification certificate specifying that condition. Such certificate was to be deemed to have been in force in respect of that person at the time of his death or retirement.

1. Section 66 provided for the payment of benefits where a person ceased to be an eligible employee by reason of retirement on the ground of invalidity before attaining his maximum retiring age. Sub-section 66(2) provided for the case where there was in force in respect of the person a benefit classification certificate and the Commissioner was of opinion that the incapacity which was the ground for his retirement was caused, or was substantially contributed to, by a physical or mental condition specified in the certificate or by a physical or mental condition connected with such a condition.

1. Part XII of the Act was headed "Transitional Provisions", the provisions contained therein operating to allocate the existing Fund among persons who were pensioners under the superseded Act and contributors to that Fund who were to become contributors to the newly established Fund. Division 4 within that Part dealt with existing contributors. Section 184 within that Division dealt with medical examinations and benefit classification certificates. Its evident purpose was to equate, as far as possible, the situation of those who had been contributors to the Superannuation Fund or the Provident Account under the superseded Act and had become contributors to the newly established Fund to the situation of new employees contributing to that Fund. It began by providing that, subject to sub-s.184(2), s.16 did not apply to an existing contributor, that is to say a person who had been a contributor to the Superannuation Fund or the Provident Account under the superseded Act. Sub-section 184(2) provided that, for the purposes of the Act, there was to be deemed to be in force, in respect of an eligible employee to which the sub-section applied, a benefit classification certificate issued under sub-s.16(4) specifying the physical or mental condition by reason of which the Superannuation Board did not accept the person as a contributor under Part III of the superseded Act. The sub-section applied to an eligible employee -
   
   

(a) who was an existing contributor and who, immediately before the commencing day, was (otherwise than by reason of an election under s.81 of the superseded Act) a contributor to the Provident Account established under that Act;

(b) whose period of contributory service on the commencing day would have been less than 20 years if he had ceased to be an eligible employee on that day; and

(c) who at the commencement of the Act, had not attained his maximum retiring age.

Sub-section 184(3) provided as follows -

"(3) Where -

(a) an eligible employee who is an existing contributor (whether or not he was, immediately before the commencing day, a contributor to the Provident Account established under the superseded Act) has ceased to be an eligible employee by reason of death or retirement on the ground of invalidity;

(b) his period of contributory service is less than 20 years and, at the time he ceased to be an eligible employee, he had not attained his maximum retiring age;

(c) a benefit classification certificate was not, by virtue of sub-section (2), deemed to have been in force in respect of him on the commencing day or, if a benefit classification certificate was, by virtue of sub-section (2), deemed to have been in force in respect of him on the commencing day -

(i) the certificate was not in force in respect of him at the time he ceased to be an eligible employee; or

(ii) the certificate was in force in respect of him at that time but there was not specified in the certificate the physical or mental condition or conditions which, in the opinion of the Commissioner, caused, or substantially contributed to, the death or the incapacity which was the ground for his retirement on the ground of invalidity; and

(d) the Commissioner is satisfied -

(i) that, at or in connexion with a medical examination which the person was required to undergo by virtue of section 5 of the superseded Act, the person failed to furnish any information required to be furnished by him or furnished false information; and

(ii) that, if the person had not failed to furnish that information or had not furnished false information, he would, immediately before the commencing day, have been a contributor to the Provident Account established under the superseded Act or, if he was, immediately before that day, a contributor to the Provident Account, there would, by virtue of sub-section (2), be deemed to have been in force in respect of him at the time he ceased to be an eligible employee a benefit classification certificate in which the physical or mental condition or conditions referred to in paragraph (c), or a physical or mental condition connected with that condition or those conditions, would have been deemed to have been specified,

the Commissioner shall issue a benefit classification certificate in which the condition or conditions referred to in paragraph (c) is or are specified and, for the purposes of this Act, the certificate shall be deemed to have been in force in respect of that person at the time of his death or retirement."

1. Under that sub-section the Commissioner was obliged in a variety of circumstances to issue a benefit classification certificate specifying the condition causing death or retirement. To justify the issue of the certificate it was necessary that the eligible employee had been a contributor to the Superannuation Fund or the Provident Account under the superseded Act and was a contributor to the newly created Fund, that he had ceased to be an eligible employee by reason of death or retirement on the ground of invalidity, that his period of contributory service was less than 20 years and that, at the time he ceased to be an eligible employee, he had not attained his maximum retiring age. In addition, one or other of three requirements had to be met, namely -
   
   

(a) a benefit classification certificate was not, by virtue of sub-section 184(2), deemed to have been in force in respect of the employee on the commencing day; or

(b) a benefit classification certificate was so deemed to be in force in respect of him on that day but was not in force at the time he ceased to be an eligible employee (presumably because it had been revoked under sub-s.16(8)); or

(c) a benefit classification certificate was so deemed to be in force in respect of him on the commencing day and was in force at the time he ceased to be an eligible employee but there was not specified in the certificate the condition causing death or retirement.

1. If the employee's situation fell within the above requirements there were further hurdles to be surmounted before the Commissioner's power to issue a benefit classification certificate would come into operation. The Commissioner was to be satisfied that, at or in connection with a medical examination required by virtue of s.5 of the superseded Act, the employee furnished false information and either -
   
   

(a) that, if he had not furnished that false information, the employee would, immediately before the commencing day, have been a contributor to the Provident Account; or

(b) that, if he was immediately before that date a contributor to the Provident Account, there would, by virtue of sub-s.184(2), be deemed to have been in force in respect of him at the time he ceased to be an eligible employee a benefit classification certificate in which the condition causing death or retirement, or a physical or mental condition connected with that condition would have been deemed to have been specified.

1. The provisions of sub-s.184(2) deeming benefit classification certificates to be in force were expressed to apply only to persons who were, in fact, immediately before the commencing day contributors to the Provident Account established under the superseded Act and who had become such otherwise then by reason of an election made under s.81 of that Act. Sub-section 184(3) was not so limited. It was capable of an operation in relation to a person who immediately before the commencing day was a contributor either to the Superannuation Fund or to the Provident Account under the superseded Act. It, therefore, dealt with cases where a benefit classification certificate was deemed to be in force under sub-s.184(2) and cases in which that deeming provision could have no operation. Its evident purpose was to assimilate the position of those where no appropriate benefit classification certificate was deemed to be in force at the date the person ceased to be an eligible employee to the cases where such a certificate was deemed to be in force at that date.

2. In order to achieve that result para.184(3)(d)(ii) required the Commissioner to address two questions. The first was whether, if the person had not failed to furnish the false information, he would, immediately before the commencing day, have been a contributor to the Provident Account. The second was whether, if he had then been a contributor to the Provident Account, there would, by virtue of sub-s.184(2) be deemed to have been in force in respect of him at the time he ceased to be an eligible employee a benefit classification certificate specifying the condition causing death or retirement. Neither of those questions required that the person had, in fact, been a contributor to the Provident Account - indeed, to the contrary.

3. Although the legislative intention which s.184 sought to effect is clear enough, the approach embodied in that provision appears to have proved unworkable, doubtless because its operation depended upon discovering the mental or physical condition by reason of which the Superannuation Board did not accept the person as a contributor to the Superannuation Fund established by the superseded Act. The Board had, however, not been in the habit of expressly recording such information.

4. What has been said provides the background to the amendments made by the Superannuation Acts Amendment Act 1978 which must now be considered. By that Act s.16 of the Superannuation Act 1976 was amended and s.184 was repealed and a new section inserted in its stead. Although s.16 was amended in a number of respects it is sufficient for present purposes to note that sub-s.16(11) was omitted and a new sub-section inserted. The new sub-section read -
   
   

"(11) Where -

(a) a person ceases to be an eligible employee by reason of death or retirement on the ground of invalidity;

(b) his period of contributory service is less than 20 years and, on the day on which he ceases to be an eligible employee, he has not attained his maximum retiring age;

(c) a benefit classification certificate is not in force in respect of the person immediately before his death or retirement or, if a benefit classification certificate is in force in respect of him at that time, the Commissioner is not of the opinion that the death or incapacity which was the ground for his retirement was caused, or substantially contributed to, by a physical or mental condition or conditions of the person specified in the certificate, or by a physical or mental condition or conditions connected with such a condition or such conditions; and

(d) the Commissioner is satisfied -

(i) that, at or in connexion with a medical examination which the person was required to undergo under this section, the person failed to furnish any information required to be furnished by him or furnished false information; and

(ii) that, if the person had not failed to furnish that information or had not furnished that false information, there would have been in force in respect of the person, immediately before his death or retirement, a benefit classification certificate in which there would have been specified the physical or mental condition or conditions which caused, or substantially contributed to, the death or retirement, or a physical or mental condition or conditions connected with such a condition or such conditions,

the Commissioner shall issue in respect of the person a benefit classification certificate in which there is or are specified the physical or mental condition or conditions of the person which, in the opinion of the Commissioner -

(e) in a case where a benefit classification certificate is in force in respect of the person at the time he dies or retires - would have been the physical or mental ondition or conditions of the person specified in the certificate at that time; or

(f) in any other case - would have been the physical or mental condition or conditions of the person specified, at the time the person dies or retires, in the benefit classification certificate that would have been in force in respect of the person,

if the person had not failed to furnish that information or had not furnished that false information and, for the purposes of this Act, the certificate shall be deemed to have been in force in respect of the person immediately before his death or retirement."

1. As sub-ss.(1), (2), (5) and (7) of the new s.184 are the provisions by reference to which the principal issue in this appeal is to be resolved, it is desirable that their text be set out in full. They provide -
   
   

"184.(1) This section applies to a person who is, or at any time has been, an existing contributor other than -

(a) an existing contributor who has previously ceased to be an eligible employee by reason of retirement on the ground of invalidity, being an existing contributor to whom, upon his so ceasing, invalidity benefit was payable in accordance with section 69, 72 or 73; or

(b) an existing contributor who had previously ceased to be an eligible employee otherwise than by reason of retirement on the ground of invalidity.

(2)Subject to sub-section (4), where -

(a) a person to whom this section applies who, immediately before the commencing day, was (otherwise than by reason of an election made under section 81 of the superseded Act) a contributor to the Provident Account ceases to be an eligible employee by reason of death or retirement on the ground of invalidity;

(b) his period of contributory service is less than 20 years and, on the day on which he ceases to be an eligible employee, he has not attained his maximum retiring age; and

(c) the Commissioner is of the opinion that the death of the person or the incapacity which was the ground for the retirement of the person was caused, or was substantially contributed to -

(i) by the physical or mental condition of the person that was relevant for the purposes of the superseded Act or, if there was more than one such condition, by those conditions or one or more of those conditions; or

(ii) by a physical or mental condition or conditions of the person connected with the physical or mental condition of the person that was relevant for the purposes of the superseded Act or, if there was more than one such condition, with those conditions or one or more of those conditions,

the Commissioner shall issue in respect of the person a benefit classification certificate in which there is or are specified the physical or mental condition or conditions of the person that was or were relevant for the purposes of the superseded Act and, for the purposes of this Act, the certificate shall be deemed to have been issued under sub-section 16(4) and to have been in force in respect of the person immediately before his death or retirement.

...

(5) Where -

(a) a person to whom this section applies (whether or not he was, immediately before the commencing day, a contributor to the Provident Account) ceases to be an eligible employee by reason of death or retirement on the ground of invalidity;

(b) his period of contributory service is less than 20 years and, on the day on which he ceases to be an eligible employee, he has not attained his maximum retiring age;

(c) the person was, immediately before the commencing day, a contributor to the Fund or, if the person was, immediately before the commencing day, a contributor to the Provident Account, the Commissioner is not of the opinion that the death of the person or the incapacity which was the ground for the retirement of the person was caused, or was substantially contributed to -

(i) by the physical or mental condition of the person that was relevant for the purposes of the superseded Act or, if there was more than one such condition, by those conditions or one or more of those conditions; or

(ii) by a physical or mental condition or conditions of the person connected with the physical or mental condition of the person that was relevant for the purposes of the superseded Act or, if there was more than one such condition, with those conditions or one or more of those conditions; and

(d) the Commissioner is satisfied -

(i) that, at or in connexion with a medical examination which the person underwent for the purposes of the superseded Act, the person failed to furnish any information required to be furnished by him or furnished false information; and

(ii) that, if the person had not failed to furnish that information or had not furnished that false information and, in a case where the person would not have been a contributor to the Provident Account or a contributor to the Fund immediately before the commencing day but for the failure to furnish that information or the furnishing of that false information, the person had been a contributor to the Provident Account immediately before the commencing day, there would have been deemed to be in force in respect of the person, immediately before his death or retirement, a benefit classification certificate in which there would have been specified the physical or mental condition which caused, or substantially contributed to, the death or retirement, or a physical or mental condition or conditions connected with such a condition or conditions,

the Commissioner shall issue in respect of the person a benefit classification certificate in which there is or are specified the physical or mental condition or conditions of the person that, in the opinion of the Commissioner, would have been the physical or mental condition or conditions of the person specified in the benefit classification certificate that the Commissioner would have issued, or, but for sub-section (4), would have issued, in respect of the person under sub-section (2) if the person had not failed to furnish that information or had not furnished that false information and, in a case where the person would not have been a contributor to the Provident Account or a contributor to the Fund immediately before the commencing day but for the failure to furnish that information or the furnishing of that false information, the person had been a contributor to the Provident Account immediately before the commencing day and, for the purposes of this Act, the certificate shall be deemed to have been issued under sub-section 16(11) and to have been in force in respect of the person immediately before his death or retirement.

...

(7) In this section

(a) a reference to a contributor to the Fund shall be read as a reference to a contributor to the existing Fund under Part III of the superseded Act;

(b) a reference to a contributor to the Provident Account shall be read as a reference to a contributor to the Provident Account established under the superseded Act; and

(c) a reference to the physical or mental condition or conditions of a person that was or were relevant for the purposes of the superseded Act shall be read as a reference to the physical or mental condition or conditions of the person that, in the opinion of the Commissioner, was or were the physical or mental conditions or conditioons of the person by reason of which -

(i) the Superannuation Board was not satisfied under sub-section 5(1) of the superseded Act that the health and physical fitness of the person were such as to justify his being accepted as a contributor to the Fund; or

(ii) the person was not, by virtue of a provision of the superseded Act (other than sub-section 5(1) or 79(2) of the superseded Act), accepted as a contributor to the Fund,

other than -

(iii) a physical or mental condition that, in the opinion of the Commissioner, did not exist -

(A) at the time the person became a contributor to the Fund or a contributor to the Provident Account; or

(B) where the person so became a contributor on more than one occasion - at the time he last so became a contributor and immediately before which he was not a contributor to the Provident Account and was not in receipt of pension in accordance with section 45 of the superseded Act; or

(iv) a physical or mental condition that, in the opinion of the Commissioner, the Superannuation Board was, as a result of a medical examination under sub-section 79(2) of the superseded Act, satisfied no longer existed unless the Commissioner is satisfied that, but for the failure of the person to furnish any information required to be furnished by him or the furnishing of false information at or in connexion with that medical examination, the Board would not have been so satisfied."

1. The new s.184 was inserted in the Superannuation Act 1976 by sub-s.77(1) of the Superannuation Acts Amendment Act 1978. Sub-section 77(2) of that Act provided that, subject to sub-ss.(3) and (4) of section 77 (which are not material for present purposes), sub-s.184(2) as previously in force was to be deemed never to have applied to or in relation to existing contributors who did not cease to be eligible employees before the commencement of the section, that is to say, 24 April 1978.

2. It is to be noted that the provision deeming benefit classification certificates to be in force in respect of contributors to the Provident Account was replaced by a provision requiring the Commissioner to issue such certificates in the circumstances mentioned in the new sub-s.184(2). That sub-section, however, applied, as did the provision it replaced, only to persons who had immediately before the commencing day been contributors to the Provident Account otherwise than by reason of an election under s.81 of the superseded Act.

3. It is convenient to examine the terms of sub-s.184(5) not in the abstract but in the light of the facts relating to the applicant as found by the Tribunal. It may be accepted that the applicant fell within sub-s.184(1). She was, therefore, in terms of sub-s.184(5) a person to whom the section applied who ceased to be an eligible employee by reason of retirement on the ground of invalidity (para.(a)). Her period of contributory service was less than 20 years and, on the day on which she ceased to be an elibible employee, she had not attained her maximum retiring age (para.(b)). She was, immediately before the commencing day, a contributor to the Superannuation Fund under Part III of the superseded Act (para.(c) and para.184(7)(a)). It must also be accepted that the Commissioner was satisfied (as was the Tribunal), in terms of para.(5)(d)(i), that, at or in connection with a medical examination which the applicant underwent for the purposes of the superseded Act, she furnished false information.

4. The critical question is whether the Tribunal was entitled to be satisfied that the applicant fell within para.(5)(d)(ii). The Tribunal determined that the applicant did fall within that provision because -
   
   

(a) it was a case where the applicant would not have been a contributor to the Superannuation Fund under the superseded Act immediately before the commencing day, as she was, but for the furnishing of the false information; and

(b) if the applicant had not furnished that false information and if she had been a contributor to the Provident Fund immediately before the commencing day, there would have been deemed to be in force in respect of her, immediately before her retirement, a benefit classification certificate in which there would have been specified the physical or mental condition which caused, or substantially contributed to, her retirement, or a physical or mental condition connected with such condition.

That being so, it followed, so the Tribunal determined, that the Commissioner was bound to issue in respect of the applicant a benefit classification certificate specifying the condition that, in the opinion of the Commissioner, would have been the condition specified in the certificate that the Commissioner would have issued under sub-s.184(2) if the applicant had not furnished the false information and had been a contributor to the Provident Account immediately before the commencing day.

1. Before considering the submissions put to the Court on the hearing of the appeal attention should be directed to the reference in para.184(5)(d)(ii) to the hypothesis that, if the person had been a contributor to the Provident Account immediately before the commencing day, "there would have been deemed to be in force in respect of the person, immediately before his death or retirement, a benefit classification certificate". (The justification for concluding that the reference in that paragraph is to a hypothetical situation is explained later in these reasons.) The language of para. 184(5)(d)(ii) is redolent of the repealed sub-s.184(2) though that sub-section operated to deem such a certificate to be in force on the commencing day rather than immediately before the person's death or retirement. In any event, sub-s.184(2), as has already been mentioned, was to be deemed never to have applied in such a case.

2. The Tribunal clearly regarded the words quoted as referring to a benefit classification certificate that would, in the circumstances postulated, have been issued in respect of the person under the new sub-s.184(2). That certificate which, if issued, would have been deemed to have been issued under sub-s.16(4) and to have been in force in respect of the person immediately before his death or retirement. So to read the provision is necessary to give effect to it. The correctness of that view was not challenged on the hearing of the appeal.

3. Counsel for the applicant contended, however, that para.184(5)(d)(ii) had no application in her case. He relied on the following words (which were not in the repealed provisions) namely -
   
   

"... and, in a case where the person would not have been a contributor to the Provident Account or a contributor to the Fund immediately before the commencing day but for the failure to furnish that information or the furnishing of that false information, ..."

1. Counsel submitted that those words indicated that the section applied only to a person who would not have been a member of the Fund or a member of the Provident Account, i.e. if he had been truthful or made full disclosure he would not have been accepted as a contributor to either.

2. In our opinion this is neither a necessary, nor the proper, construction to place upon the provision. The words are equally capable of being read distributively, as the Tribunal construed them. So read they cover a person who was in fact a contributor to the Superannuation Fund who would not have been accepted as such but for the furnishing of false information as well as a person who was in fact a contributor to the Provident Account who would not have been accepted as a contributor thereto but for the furnishing of false information.

3. Counsel for the applicant contended that so to construe the provision meant that it would have no application to a person who failed to disclose a physical or mental condition that was so serious that, had it been disclosed, he would not have been accepted for either the Superannuaton Fund or the Provident Account. We are unable to agree that that is the effect of the construction which the Tribunal placed upon the provision. The provision is concerned with persons who were, in fact, contributors to the Fund or the Account. On the construction adopted by the Tribunal, if it is proper to conclude that the person, having disclosed the true facts, would not have been accepted as a contributor to the Fund, that is sufficient to bring the provision into operation. It is unnecessary, and indeed irrelevant, to consider also whether, if true disclosure had been made, he would not have been accepted for the Provident Account. Even if, in a given case the conclusion were open that he would not have been accepted as a contributor to either the Superannuation Fund or the Provident Account, that circumstance would not detract from the conclusion that, if the true facts had been known, he would not have been accepted as a contributor to the Fund.

4. To read the provision as the Tribunal did accords with, rather than diverges from, the obvious purpose of the legislation. The contention that para.184(5)(d)(ii) has no application to the circumstances of this case is rejected.

5. Counsel for the applicant also drew attention to the words immediately following those considered above, namely the words "the person had been a contributor to the Provident Account immediately before the commencing day". His contention was that those words referred to a factual situation and restricted the application of the provision to a person who had, in fact, been a contributor to the Provident Account. The applicant was not in that situation and thus was, in his submission, excluded.

6. This submission must also be rejected. On the proper construction of the provision the words quoted are governed by the word "if" appearing at the beginning of the paragraph. The provision is directed to a hypothetical situation and requires that it be assumed that the person was such a contributor. That this is the true construction of the provision is strengthened when regard is had to the provisions previously in force (to which reference has already been made) where the corresponding words clearly required membership of the Provident Account to be assumed.

7. In our opinion the Tribunal correctly construed para.184(5)(d) and correctly applied its provisions to the applicant's circumstances.

8. Counsel for the applicant alleged two further errors of law on the part of the Tribunal, each of which arose in the interpretation and application of certain of the provisions of s.184(2). Those provisions are imported into para.184(5)(d) because the benefit classification certificate which the Commissioner was obliged to issue under sub-s.184(5) was a certificate specifying the mental condition of the applicant that, in his opinion, would have been the condition specified in the benefit classification certificate that he would have issued in respect of the applicant under sub-s.184(2) if the applicant had not furnished false information. Thus, counsel contended, it was necessary for the Tribunal to construe and apply correctly the provisions of sub-s.184(2). It erred, in his submission, in finding, in the words of the sub-section, that there was a mental condition of the applicant that was relevant for the purposes of the superseded Act. It also erred, he said, in finding that that mental condition, in his words, was the same as, or substantially connected with, the condition which caused the applicant's retirement.

9. Paragraph 184(2)(c), to the extent relevant to the facts of this case, refers to the Commissioner being of opinion that the incapacity which was the ground for the retirement of the applicant was caused, or was substantially contributed to, "by a ... mental condition ... of the person connected with the ... mental condition of the person that was relevant for the purposes of the superseded Act ..."

10. Paragraph 184(7)(c) provides, inter alia, that a reference to the mental condition of a person that was relevant for the purposes of the superseded Act is to be read as a reference to the mental condition of the person that, in the opinion of the Commissioner, was the mental condition of the person by reason of which -
    
    

"(i) the Superannuation Board was not satisfied under sub-section 5(1) of the superseded Act that the health and physical fitness of the person were such as to justify his being accepted as a contributor to the Fund; or

(ii) the person was not, by virtue of a provision of the superseded Act (other than sub-section 5(1) or 79(2) of the superseded Act), accepted as a contributor to the Fund."

1. Counsel correctly pointed out that, in relation to the applicant, the Superannuation Board made no decision that her health and physical fitness were not such as to justify her being accepted as a contributor to the Superannuation Fund established under the superseded Act. Indeed, she was accepted as a contributor to that Fund albeit by reason of the furnishing by her of false information. Therefore, it was said, the Commissioner could not form the requisite opinion.

2. To ensure that the totality of the tortuous exercise rendered necessary under sub-s.184(5) is not a complete futility and the purpose of the legislation utterly frustrated, it appears to us to be necessary to require yet a further assumption, namely that the unfortunate Commissioner was required to consider and form an opinion as to the mental condition by reason of which the Superannuation Board would not have been relevantly satisfied in relation to the applicant if in fact true statements had been made. He is required, in our view, to form an opinion as to what the opinion of the Superannuation Board would have been if it had been properly informed. In ordinary circumstances there might be a strong disinclination to imply such an onerous obligation, but these are not, and are far from being, ordinary circumstances. Such a further assumption is justified, on the approach correctly adopted by the Tribunal based on the reasoning of the High Court in Cooper Brookes (Wollongong) Pty. Ltd. v. Federal Commissioner of Taxation (1980) 147 CLR 297, to avoid an absurdity and to enable sub-s.184(5) to be effective in appropriate circumstances. It is pertinent to note that the Commissioner is required to form his own opinion on a somewhat similar topic by sub-s.184(6).

3. It was also argued by counsel on behalf of the applicant that sub-s.184(5) should be read down so as not to apply to the applicant or to eligible employees in her situation. By way of background counsel pointed to ss.38 and 48B of the superseded Act. Section 38 was the provision which entitled a contributor to the Superannuation Fund established by that Act who was retired on the ground of invalidity or of physical or mental incapacity to perform his duties to a pension. Section 48B, the text of which has already been set out, provided that, in the circumstances there mentioned, such a contributor who retired on the ground of invalidity or physical or mental incapacity to perform his duties was entitled, not to a pension, but only to the payment of an amount equal to the amount of the contriubtions paid by him under the Act. The section, however, only applied if the contributor retired within three years after his obligation to contribute to the Superannuation Fund came into existence. By the Superannuation Act Amendment Act 1976 both s.38 and s.48B were amended so that they did not apply in respect of a contributor who retired on or after 1 July 1976.

1. Counsel's submission had a number of facets. It was said that, according to the well accepted canons of statutory interpretation, the sub-section should be read so as not to disturb what was referred to as "the applicant's vested right" to a pension under the superseded Act. Next, it was said that, in approaching the construction of sub-s.184(5), the Court should presume that the legislature did not intend, in enacting the new superannuation scheme embodied in the Superannuation Act 1976 in substitution for that embodied in the superseded Act, to disadvantage persons who would if the superseded scheme had continued have been entitled to benefits thereunder. It was also submitted that the legislation was to be construed so as not to exceed the legislative power of the Commonwealth: Acts Interpretation Act 1901, s.15A. It was said that the legislative scheme constituted by the Superannuation Act 1976 and the Superannuation Amendment Act 1976 (as amended by the Superannuation Acts Amendment Act 1978) included provisions the constitutional source of power for which must be found in s.51(xxxi) of the Constitution and that, if sub-s.184(5) were construed in such a way as to apply to the applicant, the acquisition of property which the provisions of the scheme effected was an acquisition on other than just terms.

2. We are unable to accept any part of this submission. We do not doubt that the legislative intention was to substitute the provisions of the new scheme for the old in relation to all those who had been members of the Superannuation Fund or the Provident Account under the superseded Act and who continued to be eligible employees under the new scheme. Sub-section 184(5) was, we think, clearly intended to apply, and does on its proper construction apply, to the applicant and to eligible employees in her situation. We are not persuaded that, so construed, the provision is other than a valid enactment. We are unable to characterise any part of the legislative scheme as being a law with respect to the acquisition of property by any person for a purpose in respect of which the Parliament has power to make laws as that expression is used in s.51(xxxi) of the Constitution. In particular, we do not think it is a correct analysis of the situation to say that the applicant had under the superseded Act a right of property which was acquired from her by virtue of the operation of the legislation enacted in 1976 and 1978. On this aspect of the matter it is sufficient to refer to the following passage in the judgment of Mason J. in The Commonwealth v. Tasmania (1983) 46 ALR 625 at p 708:
   
   

"The emphasis in s.51(xxxi) is not on a 'taking' of private property but on the acquisition of property for purposes of the Commonwealth. To bring the constitutional provision into play it is not enough that legislation adversely affects or terminates a pre-existing right that an owner enjoys in relation to his property; there must be an acquisition whereby the Commonwealth or another acquires an interest in property, however slight or insubstantial it may be."

1. This submission is, therefore, rejected.

2. A further alleged error of law related to the finding that the mental condition of the applicant which was, ex hypothesi, a condition relevant for the purposes of the superseded Act, was, in counsel's words, "the same as, or substantially connected with, what has been described as the retirement condition". He stated that this involved the interpretation of the words "a substantial connection", though he agreed that those words did not appear in the provision.

3. In our opinion the finding of the Tribunal was essentially a finding of fact and beyond the jurisdiction of this Court unless there was no material upon which such a finding could be based. A contention that there was insufficient material is a question of degree and a determination of fact, into which this Court is not entitled to enquire.

4. It is helpful to note that the crux of counsel's contention on this aspect of the matter was that there was clear evidence that it was the paranoid personality of the applicant which was the cause of her anxiety state on the two relevant occasions, and thus provided the necessary "connection". Dr Merrifield's evidence, he said, had clearly established that the applicant's paranoid personality was not abnormal, was not an illness and was not a "mental" condition. Counsel contended that there was positive material that the connecting link i.e. the paranoid personality was not a "mental" condition and that there was no material to the contrary.

5. In our opinion this submission must be rejected. Dr Merrifield's evidence was that it was not a "medical" condition. He did not specifically state that it was not a "mental" condition. It is in our view quite possible for a condition to be a mental condition, a condition of the mind, without it necessarily being a medical condition, a condition requiring medical treatment. There was no positive evidence to the effect that the paranoid personality of the applicant was not a mental condition. Dr Merrifield's evidence did not directly bear on this particular matter.

6. Furthermore, it is in our opinion incorrect to say that there was no material to the contrary. The Tribunal instructed itself by referring to medical publications on the classification of mental disorders. It there found material to the contrary, and in reliance upon this material after taking into account the evidence of Dr Merrifield, it found that the anxiety state of the applicant at the time of her retirement was substantially contributed to by her paranoid personality. It concluded that this latter condition was a mental condition "relevant for the purposes of the superseded Act". This Court should not interfere with this finding even if it were of the opinion that it was incorrect or not justified by the material before the Tribunal. It is our opinion, if relevant, that the Tribunal properly made this finding, which was certainly open to it.

7. The applicant based a further challenge on this aspect of the matter, namely that in referring to medical publications without giving the applicant and her advisers the opportunity to reply thereto and without putting them to Dr Merrifield the Tribunal denied natural justice to her. The question of law was expressed in the Notice of Appeal as question 2(ix) in the following terms:
   
   

"(ix)Whether the Tribunal in informing itself from a publication on the classification of diseases denied natural justice to the applicant by:-

(a) Relying on a construction of the said publication which was not put to the applicant, the respondent or any expert witness.

(b) Disregarding sworn medical evidence of a witness put forward by the respondent and thus uncontested in favour of a construction of the said publication which was contrary to that evidence.

(c) Adopting contrary to uncontested sworn expert evidence a construction of the said publication which the said publication could not reasonably bear."

1. The Tribunal had found that the applicant failed to furnish information at her entry medical examination concerning her previous history of nervous condition and that, but for that non-disclosure, she would have been admitted to the former Provident Account rather than to the Superannuation Fund because of that nervous condition. The question for the Tribunal was whether that nervous condition, which was established as an anxiety state, was a "mental condition" within the meaning of sub-s.184(5). The Tribunal considered the evidence of Dr Merrifield to the effect that the conditions of anxiety state were simply part of the applicant's personality.

2. The texts referred to by the Tribunal were Chapter 5 of World Health Organization, International Classification of Diseases: Manual of the International Statistical Classification of Diseases, Injuries and Causes of Death, 9th Revision, Geneva 1977; Diagnostic and Statistical Manual of Mental Disorders, 3rd ed., published by the American Psychiatric Association; Harrison's Principles of Internal Medicine, 10th ed.; and Blakiston's Gould Medical Dictionary, 4th ed. It concluded that the applicant's personality characteristics were properly described as a disordered personality and, in that respect, as a "mental condition" for the purposes of the Act. It found that the applicant's incapacity which was the ground for the applicant's retirement, namely her anxiety state, was substantially contributed to by the mental condition that was relevant for the purposes of the superseded Act, namely the applicant's paranoid personality.

3. It is now well established that the Administrative Appeals Tribunal, although not bound by the rules of evidence or procedure applicable in courts of law (s.33 of the Administrative Appeals Tribunal Act 1975), is under a duty to observe the requirements of natural justice (Sullivan v. Department of Transport (1978) 20 ALR 323 at p 342; Drake v. Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577 at p 589 and Minister for Immigration and Ethnic Affairs v. Pochi (1980) 31 ALR 666 at p 686).

4. In considering whether the Tribunal failed to afford to the applicant natural justice in the present context, it is useful to refer to the following dicta by Deane J. in Minister for Immigration and Ethnic Affairs v. Pochi, supra, at p 686:
   
   

"There is no universally applicable definition of the rules of natural justice which must, in the absence of legislative provision to the contrary, be observed by a statutory tribunal empowered to make or to review decisions affecting the rights, property or legitimate expectations of a person. (See, as to the appropriateness of the reference to 'legitimate expectations', per Stephen J, Salemi v. Minister for Immigration and Ethnic Affairs (1977) 14 A.L.R. 1 at 32-35 and cf per Barwick CJ, ibid, at 7). The reason for this is that the precise content of those rules will vary according to the statutory framework of the particular proceedings and the particular circumstances of the individual case. 'Natural justice requires that the procedure before any tribunal which is acting judicially shall be fair in all the circumstances, and I would be sorry to see this fundamental general principle degenerate into a series of hard-and-fast rules', (per Lord Reid, Wiseman v. Borneman (1971) AC 297 at 308). 'The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the Tribunal is acting, the subject matter that is being dealt with, and so forth', (per Tucker LJ, Russell v. Duke of Norfolk (1949) 1 All E.R. 109 at 118 adopted by Lord Donovan in Wiseman v. Borneman, supra, at 314 and by Mason J. in R. v. Minister for Immigration and Ethnic Affairs; Ex parte Ratu

(1977) 14 ALR 317 at 329). 'What the law requires in the discharge of a quasi-judicial function is judicial fairness. That is not a label for any fixed body of rules. What is fair in a given situation depends upon the circumstances', (per Kitto J, Mobil Oil Australia Pty. Ltd. v. FC of T (1963) 113 CLR 475 at 504). In the forefront of the relevant circumstances lie the nature of the decision which the statutory tribunal is authorized to make or review and the effect that that decision may have on the person affected by it (see Durayappah v. Fernando (1967) 2 AC 337 at 349)."

1. We have considered the submission by counsel for the applicant that in informing itself by reference to the texts, as it was entitled to do pursuant to s.33(1)(c) of the Administrative Appeals Tribunal Act 1975, and not inviting Dr Merrifield or the applicant or her advisers to comment thereon, the Tribunal denied natural justice to the applicant. We cannot accept the submission. Having regard to the limited purpose for which the Tribunal consulted the texts, namely to assist it in determining the question whether the words "mental condition" in sub-s.184(5), on their proper construction, were wide enough to include the applicant's personality disorder as established by the material before it, we can find no denial of natural justice by the Tribunal in that respect. We should add that we do not accept the suggestion, somewhat faintly advanced, that the Tribunal misinterpreted any of the texts to which it referred.

2. In the result the application should be dismissed with costs.