Moon and Repatriation Commission
[2004] AATA 1264
•30 November 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 1264
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2004/321
VETERANS' APPEALS DIVISION ) Re BRUCE FORSAITH MOON Applicant
And
REPATRIATION COMMISSION
Respondent
DECISION
Tribunal Deputy President Don Muller Date30 November 2004
PlaceBrisbane
Decision
The Tribunal determines that:
1. The Tribunal has jurisdiction to accept the Applicant’s application for review.
2. There is a reviewable decision.
3. The Tribunal has jurisdiction to review the reviewable decision.
4. The decision by the Repatriation Commission to calculate arrears of Special Rate pension payable to Bruce Forsaith Moon from 30 December 1991 at the rates in force during each indexation period to which those arrears relate, is affirmed.
................SIGNED..............................
D.W. MULLER
DEPUTY PRESIDENT
CATCHWORDS
VETERANS AFFAIRS – jurisdiction – letter of explanation of method of payment of arrears of Special Rate constitutes a decision made by respondent – no “self-executing” provision – arrears of Special Rate correctly paid at the rates in force during each indexation period to which arrears relate - decision affirmed
Veterans’ Entitlements Act 1986: ss5Q(1), 14, 15, 18, 19, 21A, 22, 23, 24, 25, 27, 30, 122, 122A, 135, 180 and 198
Administrative Appeals Tribunal Act 1975 : s 3(3)
Meyza v Repatriation Commission (1997) 142 ALR 580
Duncan v DFRDB Authority (1980) 30 ALR 165
Australian Postal Corporation v Forgie (2003) 202 ALR 63
REASONS FOR DECISION
29 November 2004 Deputy President Don Muller 1. On 24 August 2001, the Administrative Appeals Tribunal, by consent, determined that Bruce Forsaith Moon, the Applicant, was entitled to payment of Disability Pension at the special rate with effect from 30 December 1991.
2. Consequent upon the Tribunal’s decision of 24 August 2001, Dr. Moon was paid $98,493.79 by the Respondent. This was the amount of arrears calculated to be owing to him from the first payday after 30 December 1991, 9 January 1992 to 2 October 2001.
3. The arrears were calculated using the amounts which would have been paid to Dr. Moon from time to time had he been receiving the Disability Pension at the Special Rate from 9 January 1992 onwards.
4. Dr. Moon claims that the rate of payment of his arrears should have been the rate applicable in August 2001 for the whole period from January 1992. He claims the calculation should take into account the effects of inflation and also the fact that he has lost a significant amount of the value of the pension because he did not have the use of the payments, to which he was entitled, for approximately ten years.
5. At the hearing, Dr. Moon represented himself and the Respondent was represented by Mr. Rule.
6. There is no dispute between the parties as to the facts and I find as follows:
(a)On 30 March 1992, Dr. Moon lodged a claim for pension under s.14 of the Veterans’ Entitlements Act 1986 (the VEA) in relation to injuries which he had suffered in a fall from a tree;
(b)On 16 November 1992, a delegate of the respondent rejected the claim (“the entitlement decision”);
(c)On 2 September 1994, the Veterans’ Review Board (“VRB”) affirmed the entitlement decision;
(d)On 30 May 1997, by consent, this Tribunal set aside the entitlement decision and substituted its own decision that the injuries which Dr. Moon had suffered in his fall were war-caused. The matter of assessment of pension was remitted to the respondent for consideration.
(e)On 19 August 1998, a delegate of the respondent assessed Dr. Moon’s entitlement to Disability Pension at 100% of the General Rate with effect from 30 December 1991 (“the assessment decision”);
(f)On 16 January 1998 the VRB affirmed the assessment decision;
(g)On 24 August 2001, this Tribunal, by consent set aside the assessment decision and substituted its own decision that Dr. Moon was entitled to payment of Disability Pension at the Special Rate with effect from 30 December 1991;
(h)At the same time, Dr. Moon withdrew several other applications which had been before the Tribunal in relation to decisions taken by the Respondent on entitlement and assessment issues. These applications were:
(i)Q1998/160 – an application for review of a decision by the Respondent that the Applicant did not suffer from war-caused post traumatic stress disorder; and
(ii)Q1999/179 – an application for review of a decision by the Respondent which had assessed the Disability Pension as being payable at 50% of the General Rate with effect from 30 December 1991; and
(iii)Q1999/238 – an application for review of a decision of the Respondent which assessed the Disability Pension as being payable at 70% of the General Rate with effect from 6 June 1993.
(i)Consequent upon the Tribunal’s decision of 24 August 2001, Dr. Moon was paid arrears of Disability Pension in the amount of $98,493.79;
(j)On 14 October 2001, Dr. Moon wrote to the Respondent seeking an explanation of the method used by the Respondent to calculate the arrears payment;
(k)On 28 November 2001, a departmental officer, Ms. Lindsay, wrote to Dr. Moon providing him with a breakdown of the manner in which his arrears were calculated, and setting out the provisions of the VEA which were said to be relevant to that calculation;
(l)On 9 January 2002, Dr. Moon sought to institute a “formal appeal” to the VRB regarding the contents of the letter of 28 November 2001;
(m)On 20 March 2002, the Executive Officer of the VRB wrote to Dr. Moon informing him that he did not have a right of review to the VRB. The reasons given were:
“Section 135 of the Veterans’ Entitlements Act 1986 sets out the only matters that are reviewable by the Board. An essential element of any reviewable decision under that section is that it must be made by the Repatriation Commission or a delegate of the Commission.
The Act does not provide for the calculation of arrears of pension to be determined by the Repatriation Commission or a delegate of the Commission. Therefore, it cannot be reviewed by the Board.
My understanding is that arrears of pension is calculated by computer and payment is implemented by an officer of the Department of Veterans’ Affairs under delegation from the Secretary of the Department to authorise payment from the Consolidated Revenue Fund in accordance with the fortnightly rates as automatically determined by the Act. The Act does not give the Repatriation Commission any decision-making powers in this regard.
In the case of pension paid at the special rate, the fortnightly rate is specified in subsection 24(4) and is automatically adjusted for each relevant period as specified in section 198 (which provides for regular indexation). As the amount of arrears payable is specified in the Act, it does not involve a decision of the Commission, because it is self-executing. While the payment of arrears requires financial authorisation in accordance with the Department’s responsibilities under Financial Management and Accountability Act 1997 for the relevant amount to be paid from the Consolidated Revenue Fund to the proper bank account, this does not involve a decision by a delegate of the Repatriation Commission, but rather, it involves a delegate of the Secretary of the Department.”
(n)After further correspondence from Dr. Moon, the VRB’s Executive Officer again wrote to Dr. Moon on 12 June 2002, confirming his earlier advice that the Applicant did not have a right of review to the VRB;
(o)On 23 September 2002, Dr. Moon applied to the AAT for review of his claim concerning the rate of payment of arrears. This matter was given file No. Q2002/819;
(p)The matter did not progress to hearing until February 2004. Delays were caused by Dr. Moon’s attempt to obtain legal aid. Significant delays were also caused by representatives of the Respondent who asked for time to further consider the Respondent’s position.
(q)On 20 February 2004, it was agreed between the parties that the Tribunal should remit the matter to the VRB for reconsideration. This was done.
(r)The VRB heard the matter on 4 March 2004. The VRB decision was that it had no jurisdiction to review the subject matter of the application for review, because:
“In conclusion, the subject matter of the applicant’s request does not involve a decision made by the Repatriation Commission (or a delegate of the Commission). Accordingly, the request does not constitute a valid application for review by the Board under s.135 of the Act.”
(s)Dr. Moon applied to the AAT for review of the VRB decision that there was no reviewable decision for the VRB to review.
7. Dr. Moon has raised two matters of jurisdiction, and one substantive matter to be determined by the Tribunal. They are:
(a)Whether the AAT has jurisdiction to accept the Applicant’s application for review;
(b)Whether the AAT has jurisdiction to enquire into the merits; and
(c)Whether the Applicant is correct in his assertion that his arrears of special rate were calculated according to incorrect principles.
8. Where the VRB makes a decision, or purports to make a decision, that it does not have jurisdiction in relation to a particular application, it must be taken to have affirmed under s.139(3) of the VEA, the decision which formed the subject of that application. See Meyza v Repatriation Commission (1997) 142 ALR 580 at 585-589 and at 588 where Nicholson J said:
“…. reference to s.139(3) makes apparent that, for the purpose of reviewing a decision of the respondent, the board must make a decision in one or other of the three permitted ways. It cannot act in any other way. If it uses a different form of words it is appropriate to look to this substance of what it has done to determine whether it has acted in one or other of the authorised ways. If a board decides it does not have jurisdiction its decision has the effect of affirming the decision under review because it does not vary it or set it aside and make a decision in substitution.”
9. The VRB has considered Dr. Moon’s application and although it made a finding that it had no jurisdiction, the requirements of s.175 of the VEA have been fulfilled and the AAT’s jurisdiction to accept the application for review has been enlivened.
10. I find that the AAT has jurisdiction to accept Dr. Moon’s application for review.
11. The second matter of jurisdiction is whether the AAT can review the merits of the substantial issue. That involves consideration of whether the VRB was similarly empowered to enquire into the merits. The VRB’s jurisdiction is set out in s.135(1) of the VEA which provided, so far as is relevant to this case:
“135 (1) Where a person:
(a) who has made a claim for pension in accordance with section 14;
(b)who has made application for a pension, or for an increased pension, in accordance with section 15: or
(c)….
is dissatisfied with any decision of the Commission in respect of the claim or application… the person may, subject to this Act, make application to the Board for a review of the decision of the Commission.”
12. There are three key elements that must be satisfied before the jurisdiction of the VRB is enlivened. They are:
(a)There must be a decision;
(b)That decision must be a decision of the Commission, or its delegate, or delegates; and
(c)The decision of the Commission must be a decision in respect of a claim or application lodged under section 14 or 15 of the VEA.
13. It seems to have been the contention of the Commission, adopted by the VRB, that a computer interpreted the VEA and then automatically calculated Dr. Moon’s arrears, without any human involvement. Thus, it was contended, there was never any decision made and therefore no reviewable decision capable of being reviewed by the VRB.
14. However, common sense dictates that a human agency made decisions relating to the way in which the Act was to be interpreted and the rates at which arrears payments to Dr. Moon were to be made. It must be the fact that a delegate of the Commission decided what information was to be fed into the computer. A human agency must have determined that the rate of arrears was to be the rate that was historically applicable to each individual year and not the rate for 2001 for the whole of the arrears period. In this exercise the computer was nothing more than a sophisticated adding machine.
15. The letter from Ms. Lindsay to Dr. Moon, dated 28 November 2001, indicates that a human agency had indeed made an interpretation of various sections of the VEA to determine the method by which arrears were to be calculated. The full text of the letter was:
“I am writing in response to your letter dated 14 October 2001.
In response to questions 1 and 2, I have attached Sections 27A, 121, 122, 122A of the Veterans’ Entitlements Act which outline the calculation and payment of arrears. Also attached is a detailed account of the actual rate of payments for each of the weeks during the backdated period.
In regards to question 3, I have contacted our National Office Policy section and they were unable to advise of any judicial decision which impact on the way arrears are paid.”
16. (a) Section 5Q(1) of the VEA defines the term “decision”
as follows:“Decision includes a determination and an assessment”
(b)Section 3(3) of the Administrative Appeals Tribunal Act 1975 (the AAT Act) provides for the interpretation of “decision” as follows:
“A reference in this Act to a decision includes a reference to:
(a)making, suspending, revoking or refusing to make an order or determination;
(b)giving, suspending, revoking or refusing to give a certificate, direction, approval, consent or permission;
(c)issuing, suspending, revoking or refusing to issue a licence, authority or other instrument;
(d)imposing a condition or restriction;
(e)making a declaration, demand or requirement;
(f)retaining, or refusing to deliver up, an article; or
(g)doing or refusing to do any other act or thing.”
(c)The New Shorter Oxford English Dictionary defines the term “decision” as follows:
“The action of deciding a contest, dispute etc; settlement, a final (formal) judgment or verdict… The action of coming to a determination or resolution with regard to any point or course of action; a resolution or conclusion arrived at.”
17. The letter from Ms. Lindsay to Dr. Moon dated 28 November 2001 is capable of falling within the ordinary meaning of the word “decision”. Ms. Lindsay’s letter embodies a “resolution or conclusion arrived at” regarding the quantum of the arrears of pension to which Dr. Moon was entitled and the manner in which it was required to be calculated.
18. In Duncan v DFRDB Authority (1980) 30 ALR 165, Mr. Duncan sought advice from the Authority regarding his liability to contribute to the superannuation scheme established under the DFRDB Act. In response to Mr. Duncan’s enquiry, a letter was sent to him by the Authority’s administrator setting out the Authority’s view regarding the proper application of the DFRDB Act to his circumstances. Mr. Duncan disputed the Authority’s view and the matter as taken on appeal to the AAT and ultimately to the Federal Court. The Federal Court (Brennan, Keely and Lockhart JJ) said, at 169 and 170:
“A question arises as to whether the formation and communication of its view by the Authority is a ‘decision’ within the meaning of the definition in the AAT Act. The Authority did not alter rights, nor impose a liability. The legal liability of the applicant to contribute under s 19 and his legal entitlement under s 23 were alike unaffected by the Authority’s view: the Authority had no power judicially to decide these matters, nor to determine them in any final sense. Yet in practice, as we were told, the Authority’s view is accepted by the Navy Pay Office which makes the deductions from pay in accordance with ss 17 and 19 of the DFRDB Act, and no doubt the Authority authorizes the making of payments under s 23 in accordance with its view of a particular member’s entitlement. The Authority declared what was the measure of the applicant’s liability to contribute, and although the declaration did not affect the applicant’s true legal liability, it was nevertheless effective in practice to prevent the deduction of a larger contribution from Captain Duncan’s pay. And the Authority refused its consent to the making of a larger contribution. What the Authority did thus falls within one or more of the categories defined by s 3(3) of the AAT Act to constitute a ‘decision’. Not all decisions within the meaning of s 3(3) of the AAT Act are reviewable decisions. The AAT Act contemplates that, when other enactments confer jurisdiction upon the Tribunal to review particular classes of decision, those decisions will be ‘made in the exercise of powers conferred by the enactment’ (s 25(1)). Assuming that this provision limits the classes of decisions reviewable under s 99 of the DFRDB Act to decisions made by the Authority in the exercise of powers conferred upon it, it is necessary to find the power to make the administrative decision which the Tribunal was invited to review. The power is to be found in s 8(1) of the DFRDB Act, which confides to the Authority the ‘general administration’ of the DFRDB Act.
The Authority acted as it did in fulfilment of its function of administering the Act, and in the exercise of the powers conferred upon it in that behalf by s 8(1). The making and notifying of its decision as to the measure of the applicant’s liability to contribute was a ‘decision’ within the meaning of that term in the AAT Act, and it was reviewable by the Tribunal under s 99 of the DFRDB Act.”
19. Until recently, a line of decisions under the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act) had concluded that “self-executing” provisions in the Act did not authorise the making of a decision under an enactment which was capable of review under either the SRC Act or the AAT Act. See Buck v Comcare (1996) 137 ALR 335, Trajikovski v Telstra Corporation Ltd (1988) 153 ALR 248 and Chowdhary v Bayne (1999) 29 AAR 100.
20. However, this approach to self-executing provisions in the SRC Act was re-examined by the Full Federal Court in Australian Postal Corporation v Forgie (2003) 202 ALR 63. The Court said:
“[40] The way in which s 37(7) must operate also suggests that a ‘determination’ is required. The inclusion of the words ‘without reasonable excuse’ introduces a distinctive requirement for some deliberative human action. An assessment needs to be made at some point – by a person – as to a refusal or failure to undertake a rehabilitation program, and to the reasonableness or unreasonableness of that refusal or failure. Such a process requires that the person at least consider the circumstances surrounding the employee’s failure or refusal to undertake a rehabilitation program and to evaluate what is reasonable in the circumstances. This intellectual process involves matters of judgment and degree. The suspension of rights under s 37(7) can only occur by force of law once some such assessment has been made. The process cannot be conducted in a manner analogous to the mechanistic operations of a sorting machine. The process that is required would seem unequivocally to fall, at least, within the s 3(3)(g) AAT Act definition of ‘decision’ as ‘doing or refusing to do any other act or thing’ and hence within the definition of ‘determination’ under the SRC Act.
[49] It was accepted in Buck, and in the subsequent cases that, as a practical matter, some person or body must make a decision as to the application of s 37(7) in any specific case: cf Trajkovski at FCR 464; ALR 253. This cannot be controversial. The question is whether it is correct to conclude that what are said to be the self-executing aspects of s 37(7) deprive the processes required for the application of s 37(7) of any relevant decision-like character. Framed in terms of the definition of ‘determination’ in s 60(1), which includes the definition of ‘decision’ in s 3(3) of the AAT Act, the question is whether or not those processes constitute, at least, ‘doing or refusing to do any act or thing’.
[50] The correct approach to the interpretation of the word ‘decision’ in the AAT Act was discussed by Lockhart J, with whom Sheppard J agreed, in Director-General of Social Services v Hales (1983) 47 ALR 281 (Hales). Hales followed the decision in Director-General of Social services v Hangan (1982) 45 ALR 23 and Re Matteo and Driector-General of Social services (1981) 4 ALD 398, and was followed in Secretary, Department of Social Security v Alvaro (1994) 50 FCR 213; 34 ALD 72.
[51] In Hales, Lockhart J held (at 305-6):
One cannot therefore look to the definition in s 3(3) [of the AAT Act] to determine definitively the meaning of the word ‘decision’. It must take its colour and content from the enactment which is the source of the decision itself. No narrow or pedantic approach is called for in determining whether a decision falls within the scope of review of the Administrative Appeals Tribunal. The multiplicity of statutes which continue to grow and to confer jurisdiction on the Administrative Appeals Tribunal, and the manifold and diverse circumstances which attract the power of the decision maker, all call for a liberal approach to the definition of the word ‘decision’… It is necessary to examine the Act which confers jurisdiction on the Administrative Appeals Tribunal and the administrative framework in which it operates to determine whether there is a ‘decision’ susceptible to review under the Administrative Appeals Tribunal Act. A pronouncement which alters rights or imposes liabilities is readily classified as a ‘decision’, but the word has a wider scope. It may include a declaration or statement which has a real practical effect although not altering rights or imposing liabilities: Duncan v Defence Force Retirement Authority (1980) 30 ALR 165 at 169-70; 3 ALD 113 at 117.
[55] To adopt again the language of Lockhard J in Hales, certain administrative processes must precede the suspension of compensation and proceeding rights. Some officer in the determining authority must form an opinion that there has been an unreasonable refusal or failure to undertake the rehabilitation program such that s 37(7) applies.
[56] In cases such as the present, a conclusion that an employee has refused or failed to comply with a rehabilitation program, and that there is no reasonable excuse for such failure or refusal, has real practical effect. It is only when such a conclusion, however it is characterised, has been reached that what is said to be the self-executing aspect of s 37(7) is triggered.”
21. The calculation of the arrears payable to Dr. Moon was taken to have been by force of a combination of sections 24(4) and s.198 of the VEA. As at 1 January 1992, subsection 24(4) said that the rate at which pension was payable to a veteran to whom s.24 applied was $554.10 per fortnight. Section 198 relates to periodic adjustments to the rates of pensions (that is, indexation). Although s.198 does not specifically deal with the method of calculation of arrears, the persons who have had responsibility for administering the Act from time to time, pursuant to subsection 180(2) of the VEA, have taken subsection 198(10) to mean that arrears are paid at the rate that was applicable during the years in question. The subsection is not so clear that one could say that there is an automatic “self-executing” situation. It reads:
“198.(10) Where, by virtue of the application of this section, this Act has effect as if another rate were substituted for a relevant rate on the first day of a relevant period, the substitution, in so far as it affects instalments of a pension under this Act, has effect in relation to every instalment of the pension that falls due on or after the first day of that period, as the case may be, but, if a pension is granted, or the rate of a pension is increased, after the first day of that period as from a date before the first day of that period, the substitution, in so far as it affects instalments of that pension, does not have effect in relation to an instalment of that pension in respect of a period that commenced before the first day of that period.”
22. The calculation of arrears in Dr. Moon’s case did not take place in a vacuum, nor did a computer automatically print out a cheque. There was a significant amount of human input from the people who are charged with administering the VEA in relation to Dr. Moon’s claim for a pension. Dr. Moon’s case is very similar to that of Mr. Duncan (referred to paragraph 17 above).
23. The Respondent’s role in relation to the payment of pensions and determining claims and applications is found in sections 18, 122, 122A and 180(2) of the VEA. Section 18 spells out the duties of the Commission in relation to “all matters relevant to the determination of the claim or application”. Sections 122 and 122A relate to some mechanical details in relation to the payment of pensions. Section 180(2) charges the Respondent with administering the VEA.
24. Section 135(1) is drafted in exceptionally broad terms. Review by the VRB is allowed in circumstances where a person who has made a claim for a pension in accordance with section 14, or for an increase in pension under section 15 is dissatisfied with any decision of the Commission in respect of the claim or application.
25. I find that Ms. Lindsay’s letter to Dr. Moon dated 28 November 2001, constituted a decision of the Commission and that it was a decision in respect of a claim for pension.
26. Consequently, I find that the VRB did have jurisdiction to review Ms. Lindsay’s decision.
DOES THIS TRIBUNAL HAVE JURISDICTION?
27. A combination of section 25 of the AAT Act and s.175(1) of the VEA provides that the Tribunal’s jurisdiction to review decisions made under the Act will be enlivened as long as:
(a)There has been a decision of the Respondent; and
(b)That decision has been reviewed by the VRB.
28. Mr. Rule, for the Respondent, conceded that Dr. Moon has an arguable case which is not without merit. The Tribunal agrees. The Tribunal also takes the view that it would require a perverse interpretation of the VEA and the AAT Act to come to the conclusion that a veteran who is not satisfied with a decision about the rate at which his pension is paid, cannot have that decision reviewed by either the VRB or the AAT.
29. The Federal Court has dealt with this type of question in at least two matters. In Collector of Customs v Brian Lawlor Automotive Pty Ltd 24 ALR 307, Bowen CJ said (at 313, 314):
“The Administrative Appeals Tribunal Act was passed in order to remedy the mischief described by the Commonwealth Administrative Committee in its Report, which was tabled in the Commonwealth Parliament on 14 October 1971. The Committee considered the existing law relating to appeals against administrative decisions as unduly technical and unsatisfactory and recommended a simpler and more broadly based system of appeals from such decisions. The Administrative Appeals Tribunal Act appears to be designed to go part of the way towards remedying that situation. It gives an appeal on the merits.
In the Administrative Appeals Tribunal Act a wide meaning is given to the word ‘decision’ by s 3(3). In s 25 it appears to me that the word simply refers to a decision in fact made, regardless of whether or not it is a legally effective decision.
at 315:
“There might be a rare case where a decision appeared to have no relationship to one of the Acts committed to the administration of the Minister or Department concerned. However, in the ordinary course, it would be reasonably clear from the objective facts under which enactment or in the exercise of which statutory powers an official had purported to act. The adoption of this view would mean that the Administrative Appeals Tribunal would have jurisdiction to entertain an appeal from a decision in fact made, which purported to be made in the exercise of powers under an enactment. It could then proceed to determine whether the decision was properly made in fact and in law. There is nothing unusual in holding that an administrative decision which is legally ineffective or void is susceptible of appeal: see Calvin v Carr (1979) 22 ALR 417”
and at 317:
“As I have said, in my opinion an applicant to the Tribunal has standing and the Tribunal has jurisdiction provided there is a decision in fact and provided further that the decision purports to have been made in exercise of powers conferred by an enactment whether or not as a matter of law it was validly made and whether or not action on the basis there was power to make the decision was right or wrong.”
And per Smithers J at 335:
“The very absence of guidelines as to the exercise by the Tribunal of its powers of review is a most significant feature supporting a conclusion that review is to proceed by reference to the standard of good government. It is a short step to infer that the overriding purpose of the Act is to promote good government by those carrying out the actual practical task of administering Acts of Parliament and making decisions incidental to that task.
It is important to observe that the Tribunal is not constituted as a body to review decisions according to the principles applicable to judicial review. In essence the Tribunal is an instrument of government administration and designed to act where decisions have been made in the course of government administration but which are in the view of the Tribunal not acceptable when tested against the requirements of good government.
It is significant also that the Administrative Appals Tribunal Act contemplates hearings free from legal technicalities without formality and with as much expedition as possible. The Tribunal itself is required to ensure that the applicant has a reasonable opportunity of presenting his case. Even before any investigation of the merits or validity of a decision the Tribunal is authorized to suspend that decision, taking into account the interest of persons affected by the review: see ss 33, 34 and 41(2) of the Administrative Appeals Tribunal Act.”
30. In Ward v Nicholls (1988) 84 ALR 471 Wilcox J said at 480, 481:
“Consequently, I am of the view that s 154(1), properly construed, had no relevance to the decision of the second Board, and that the Board was incorrect in regarding that section as an inhibition upon its considering Mr Ward’s second application on its merits. I add that, even if there had been a problem about s 154, it was an incorrect choice of language to say that the Board had ‘no jurisdiction’ in the matter. The Board had the jurisdiction given to it by s 139 of the Veterans’ Entitlements Act. It was bound to review the decision of the Commission, and thereafter to make a decision in writing affirming the decision under review, varying the decision under review or setting aside the decision under review and making a decision in substitution for the decision so set aside. If the matter had come before the second Board within the six month period, as properly computed, it is correct to say that the Board would have been bound to have affirmed the decision under review for the reason that it was not free to give effect to the claim for an increased disability pension. But, in so doing, it would have been exercising the jurisdiction given to it by s 139. It would not have been in a position of lacking jurisdiction.
It would be a very odd situation if the position were as perceived by Mr Bannon; that is to say, if the appointed first instance reviewer, the Veterans’ Review board, erroneously found that it had no jurisdiction, and the Administrative Appeals Tribunal – which is set up by statute to review on their merits decision so that Board – was then precluded from considering for itself whether that Board in fact had jurisdiction and, if so, what decision it should have made. There would be a lacuna in the system of administrative review disappointing to those who had laboured to set up the comprehensive system which appears to be provided by the statute. I cannot think that this is right. I think that the true position is that the Veteran’s Review Board is always in the position of having to decide whether to affirm, to vary or to set aside the decision of the Commission; and that, whatever decision it makes, that decision is subject to review by the Administrative Appeals Tribunal”
31. The above judgments make it clear that in circumstances such as this current case, the VRB did have jurisdiction to hear the matter and the VRB in effect made a decision to affirm the Respondent’s decision. Consequently, this Tribunal has jurisdiction to review Dr. Moon’s case on the merits.
32. I will now proceed to deal with the merits of Dr. Moon’s application.
THE RATE APPLICABLE TO THE PAYMENT OF ARREARS
33. The rate of pension payable to a veteran depends on the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both. The degree of incapacity is assessed according to the provisions of the approved “Guide to the Assessment of Rates of Veterans’ Pensions” (s.21A(1) of the VEA).
34. The degree of incapacity is determined according to whether a veteran is seriously incapacitated (100%) or whether a veteran is determined according to the Guide to be less incapacitated (10% or a multiple of 10%). (s.21A(2)).
35. Section 22 of the VEA sets the maximum quantum per fortnight to be paid to a veteran assessed at 100% (of the General Rate).
36. Sections 23 and 24 of the VEA apply to veterans who not only have incapacities arising from war-caused injuries or war-caused diseases, but who also suffer loss of salary or wages or of earnings that the veterans would not be suffering if they were free of the incapacities.
37. Section 23 relates to veterans who are restricted to part-time work for 50% or more of the time ordinarily worked by persons engaged in work of the same kind, or who are capable of working for 20 hours or more per week. Veterans who qualify under s.23 are said to be entitled to the “Intermediate Rate” which is approximately 182% of the General Rate.
38. Section 24 relates to veterans who are more seriously restricted in their capacity to earn salary and wages (incapable of working more than eight hours per week). Veterans who qualify under s.24 are said to be entitled to the “Special Rate” which is approximately 264% of the General Rate.
39. Section 25 allows for temporary payment at the Special Rate.
40. Section 27 allows for increased rates of pension for veterans who have lost limbs or who have been blinded.
41. Section 30 allows for pensions to be paid to dependants.
42. Section 19 of the VEA charges the Repatriation Commission with the responsibility of (among other things) determining whether a claimant is entitled to be granted a pension in respect of their incapacity. Then, if the Commission determines that the claimant is so entitled, to proceed to determine which of the sections 22, 23, 24, 25, 27 and 30 are applicable in the case (s.19(5A)).
43. Subsection 19(5C) directs the Commission to assess the rate or rates at which the pension would have been payable from time to time during the assessment period and the rate at which pension is payable when the claim is determined. The “assessment period” is defined in subsection 19(9) as:
Assessment period, in relation to a claim or application relating to a pension, means the period starting on the application day and ending when the claim or application is determined.
44. In Dr. Moon’s case the assessment process set out in section 19 was done and resulted in a determination that his particular circumstances satisfied the provisions of s.24 (Special Rate), not only at the date of determination but also for the whole of the “assessment period”. That is, he was entitled to be paid at the Special Rate from 30 December 1991.
45. Subsection 19(6) was not needed to be involved in Dr. Moon’s case, but it ensures that Dr. Moon is entitled to the Special Rate for the whole of the arrears period.
46. In January 1992, the maximum quantum of pension (the General Rate) pursuant to s.22 was $209.00 per fortnight. The Special Rate in January 1992 was $554.10 per fortnight.
47. Section 198 of the VEA is entitled “Variations of rates of certain pensions”. It is concerned with the adjustment to the rates of pensions. It provides the mechanism for the indexation of pension rates, having regard to changes in the Consumer Price Index over a six months period, usually at the end of March and September each year.
48. The indexation process provided for in s.198 has meant that the General Rate and the Special Rate of pension have increased from time to time over the years. When Dr. Moon’s case was eventually decided on 24 August 2001, the General Rate and Special Rate had risen respectively to $268.70 and $708.50 per fortnight.
49. Whilst there is no provision in the VEA which specifically refers to the calculation of arrears in this context, the subject is regarded by the commission as being covered by subsection 198(10), quoted in paragraph 22 above.
50. Subsection 198(10) is concerned with what happens when a new rate of pension is substituted for the previous rate. There are two considerations, namely, future rates of pension, and past rates. The first part of the subsection provides that every instalment of pension that falls due on or after the first day of the new period is paid at the new rate. However, if the rate of pension is increased the effect is prospective only. The second part of the subsection provides that if a pension is granted (or increased) after the first day of the new period, from a date before the first day of the new period, the increased rate does not have effect in relation to instalments of that pension in respect of the periods that commenced before the first day of the period. That is, arrears are payable at the rates that were applicable during the periods in question, not at the increased rate.
51. Subsection 198(10) was mentioned in the Explanatory Memorandum (1987) in relation to the Veterans’ Affairs Legislation Amendment Bill 1987. The explanation adds weight to the above interpretation:
Paragraph 46(d) would amend sub-section 198(10) of the Principal Act to clarify that where a pension is granted with effect from a date before the date of grant, arrears of that pension are to be calculated on the basis of the maximum rate of pension in force during each indexation period to which those arrears relate.
52. I find that Dr. Moon’s arrears have been correctly calculated.
53. The VEA contains no provision to allow for the calculation or payment of interest on pension arrears.
54. The decision under review is affirmed.
I certify that the 54 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President Don Muller
Signed: .....................................................................................
R. Link, AssociateDate/s of Hearing 16 June 2004
Date of Decision 30 November 2004
Applicant Dr. Moon, himself
Solicitor for the Respondent Mr. Rule and Mr. Harrison
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