Nielsen and Repatriation Commission

[2007] AATA 1451

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1451

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q200600773

VETERANS' APPEALS DIVISION		)
Re		NOEL NIELSEN

Applicant

And REPATRIATION COMMISSION

Respondent

DECISION

Tribunal Senior Member P McDermott, RFD

Date21 June 2007

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

..................[Sgd]...........................

Senior Member

CATCHWORDS

VETERANS’ APPEALS – veterans’ entitlements – disability pension – application for special rate of pension – applicant’s war-caused injury ’alone’ did not prevent the veteran from undertaking remunerative work – whether applicant genuinely seeking to engage in remunerative work – decision affirmed

Veterans’ Entitlements Act 1986 (Cth) ss 19, 21A, 23, 24

Magill v Repatriation Commission [2002] FCA 744
Peacock v Repatriation Commission [2004] FCA 1449
Jebb v Repatriation Commission (1988) 80 ALR 329
Shi v Migration Agents Registration Authority [2007] FCAFC 59
Cavell v Repatriation Commission (1988) 9 AAR 534
Conway v Repatriation Commission (2003) 37 AAR 486
Hall v Repatriation Commission (1994) 33 ALD 454
Hendy v Repatriation Commission [2002] FCA 602
Fox v Repatriation Commission (1997) 45 ALD 317

REASONS FOR DECISION

21 June 2007   Mr P McDermott RFD, Senior Member   

Introduction

1.      Mr Noel Nielsen, who is a veteran, has sought review of a decision made by the Repatriation Commission (the Commission), and varied by the Veterans’ Review Board (the Board), that he was not eligible to be paid a pension at the special rate. I am required to consider whether he meets the eligibility criteria for the payment of an earnings-related rate of pension. These eligibility criteria are provided for in the Veterans’ Entitlements Act 1986 (the Act).

Background

2.      Mr Nielsen served with the Royal Australian Air Force from 1971 until 1992. Mr Nielsen has a number of conditions which have been accepted as related to his service. These conditions being bilateral conductive hearing loss with tinnitus; osteoarthritis affecting both knees; lumbar spondylosis; post traumatic stress disorder; solar keratosis on face and both forearms; peptic ulcer disease; and alcohol dependence. He has been assessed by the Board as eligible for payment of pension at 100% of the general rate from 5 May 2006 because of these conditions. 

Issues And Legislation

3.      Section 19(5C)(a) of the Act requires that the rate of pension is to be determined during the “assessment period”. That term is defined in s 19(9) of the Act to mean, in relation to a claim or application relating to a pension, the period starting on the application day and ending when the claim or application is determined.

4.      The application day in this case was 8 March 2004 and the assessment period runs from that day. 

5.      An earnings-related rate of pension may be granted to a veteran provided that the applicant meets the requirements of s 24 of the Act.  I will mention some relevant provisions from that section.

6.      The veteran must be under sixty-five years of age at the date of the claim: s 24(1)(aab). This requirement is satisfied in this case.

7.      The degree of incapacity of the veteran from a war-caused injury or war-caused disease, or both, must be determined under section 21A to be at least 70% or has been so determined by a determination that is in force: see s 24(1)(a)(i). This is the case in this application.

8.      The veteran must be totally and permanently incapacitated, that is to say, the veteran’s incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week: see s 24(1)(b).

9.      In addition to satisfying the requirements of s 24(1)(a) and s 24(1)(b) of the Act, the veteran must also, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity: see s 24(1)(c).

10.     In this case it is common ground that Mr Nielsen meets the requirements of s 24(1)(a) and (b) of the Act. However, counsel for Mr Nielsen has properly conceded that Mr Nielsen does not satisfy s 24(1)(c) of the Act which is often referred to as the “alone” test. 

11.     The operation of s 24(1)(c), however, is ameliorated by the provisions of s 24(2)(b) of the Act which provides:

“[W]here a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking.”

12.     In Magill v Repatriation Commission [2002] FCA 744 at [8], Drummond J explained the operation of s 24(2)(b) of the Act:

“Section 24(2)(b) was correctly described by counsel for the Commission as ‘an ameliorative provision’.  If the veteran satisfies the criterion contained in s 24(1)(c) – that the war-related incapacity ‘alone’ has prevented the veteran from continuing to work – it is unnecessary to consider s 24(2)(b).  If, however, a veteran has not been engaged in remunerative work at the relevant date, he or she will still be able to satisfy the ‘alone’ criterion in s 24(1)(c) even though the war-related incapacity is not the sole cause of the veteran’s inability to obtain work, provided the veteran nevertheless meets the requirements of s 24(2)(b).”

13.     In Peacock v Repatriation Commission [2004] FCA 1449 at [20], Dowsett J observed that “[p]aragraph 24(2)(b) operates in certain circumstances to ameliorate the consequences for a veteran of failing to satisfy the requirements of par 24(1)(c)”.

14.     In determining this application I will consider whether the operation of s 24(2)(b) of the Act ameliorates the operation of s 24(1)(c) of the Act.

Evidence

15.     The only witness to give evidence before me was Mr Nielsen.  Mr Nielsen also verified two statements that he had previously given which were admitted into evidence [exs. A2 and A3].

16.     Mr Nielsen had completed a five year motor mechanic apprenticeship to become a fully qualified motor mechanic and worked as a motor mechanic for one year prior to him joining the Air Force.

17.     In 1971 Mr Nielsen joined the Air Force. He was discharged in 1992 when he declined to accept a posting to Canberra which would have been for a period of six years. Upon his discharge he went to his hobby farm at Howard. 

18.     The years between 1992 and 1995 were spent establishing a fruit farm. With the assistance of his sons, he built a shed and a “chook run” as well as planting fruit trees.

19.     In 1995 Mr Nielsen joined the active RAAF Reserve. He was invited to apply to join the Reserve upon the recommendation of a retired warrant officer who lived in his locality. After an interview he was appointed to the Reserve.

20.     In the Reserve he initially served as the Training Warrant Officer. In that position he instructed new recruits and direct entry officers in the preparation of their various induction courses. The commanding officer of his squadron subsequently appointed him as the Warrant Officer Disciplinary at Amberley. He had previously held that position before he was discharged in 1992. Mr Nielsen in oral evidence confirmed that the position of Warrant Officer Disciplinary is a responsible position. He was required to carry out ceremonial parades as well as counsel junior commissioned officers and senior air personnel on the base.

21.     Mr Nielsen was discharged from the Reserve in 2004 upon reaching the compulsory retirement age. Prior to his retirement from the Reserve, Mr Nielsen was offered the opportunity to extend his service in the Reserve for a further two years, and possibly until he was 65 years of age. Mr Nielsen stated that he declined an offer of an extension of his appointment as he was unable to pass the mandatory physical fitness tests that were required to be passed twice a year. He stated that he would have accepted the offer of an extension of an appointment if he had been able to pass the physical fitness tests.

22.     The material before me includes a letter dated 29 October 2004 from the Air Force Headquarters informing Mr Nielsen that as he reached the compulsory retirement age of 60 years, his appointment as a member of the RAAF Active Reserve was terminated [ex. A, fol 74]. Mr Nielsen has taken issue with any suggestion that his appointment to the Reserve was terminated “only” as a result of his reaching the compulsory retirement age [ex. A2, p 2]. As Mr Nielsen was an experienced Warrant Officer I accept that it was most probable that he was indeed offered the possibility of an extension of his appointment in the Reserve. I also consider that such an offer, being made on an informal basis, would not necessarily be recorded in his personnel file.

23.     Mr Nielsen had stated that after his discharge from the Reserve he visited his sister-in-law in Bowen. The actual date of that visit appears to have been in early 2005. His nephew was conducting a lawn mowing and landscape business and was having difficulty in coping with all his work. Mr Nielsen offered to assist his nephew in the business and worked for him for seven days but he stated that he could not continue that work because of his back and knee conditions. 

24.     Mr Nielsen in oral evidence stated that his military skills were not transferable to a civilian occupation. He stated that he was only able to do labouring work. He stated that his training as a motor mechanic would not enable him to do work on modern vehicles. He also stated that he would have difficulty in sitting for any length of time and this would present difficulties to any employer.

25.     After he was discharged from the Reserve, Mr Nielsen had stated that he had not registered for employment with any employment agency.

Medical Evidence

26.     On 4 May 2004 Dr M Dugdale did a medical impairment assessment of the lumbar spondylosis condition of Mr Nielsen. Dr Dugdale stated that Mr Nielsen was able to walk 3 kilometres as being the maximum he could walk without needing to rest. He assessed Mr Nielsen as having symptoms which were not solely attributable to his lumbar spondylosis. His assessment was that his symptoms were 60% attributable to his back; 30% to his hips and 10% to his knees [ex. A, fol 35].

27.     On 28 July 2004 Dr M Foxcroft, psychiatrist, diagnosed Mr Nielsen as suffering from alcohol dependence and post traumatic stress disorder. Dr Foxcroft was then of the opinion that Mr Nielsen could work for up to 20 hours per week [ex. A, T7, fol. 53].

28.     On 29 September 2004 Dr J Morris, consultant orthopaedic surgeon, examined Mr Nielsen. On 6 October 2004 he concluded in his report that Mr Nielsen’s conditions were fairly mild and that he could work for up to 40 hours per week. Dr Morris then considered that Mr Nielsen could work in occupations such as a motel manager, taxi driver, or a petrol station console operator. Dr Morris had concluded that the orthopaedic condition of Mr Nielsen was basically static and that the prognosis of Mr Nielsen’s condition was likely to be very slow [ex. A, T9, fols. 62-67].

29.     On 10 May 2007 Dr Sharon Harding, consultant psychiatrist, provided a report which was admitted into evidence [ex. A4]. Dr Harding reported: “My impression was that Mr Nielsen is suffering from ongoing Post Traumatic Stress Disorder and Alcohol Dependence” [ex. A4, p.2]. Dr Harding stated “I have been providing treatment for Mr Nielsen for Post Traumatic Stress Disorder and Alcohol Dependence since 22 February 2007” [ex. A4, p. 1]. Dr Harding has concluded that Mr Nielsen is unfit to work for any employer in any capacity.

Consideration Of The Issues

30.     At the outset I mention that this is an instance of where the Tribunal regards the administrative decision-making process as a “continuum” and the Tribunal’s function is a part of that “continuum” so that the Tribunal considers the entitlement of the applicant during the whole assessment period. See Jebb v Repatriation Commission (1988) 80 ALR 329 at 333, cited by Downes J in Shi v Migration Agents Registration Authority [2007] FCAFC 59 at [37].

31.     I must decide whether the ameliorative provision of s 24(2)(b) applies in this case. I have borne in mind the guidance that is provided in Cavell v Repatriation Commission (1988) 9 AAR 534 that a commonsense approach should be taken in considering whether the eligibility criteria in s 24 of the Act are met by an applicant.

32.     In Conway v Repatriation Commission (2003) 37 AAR 486 at [8], Dowsett J explained that s 24(2)(b) requires that there “must be an inquiry as to whether or not the relevant applicant has been genuinely seeking to engage in remunerative work in the past, that is prior to his becoming incapacitated for the purposes of s 24”.

33.     I accept the submission of counsel for Mr Nielsen that in Hall v Repatriation Commission (1994) 33 ALD 454 at 461, Spender J has ruled that the question of whether a person is genuinely seeking to engage in remunerative work must be “addressed in a realistic way”. This passage was cited by Madgwick J in Hendy v Repatriation Commission (2002) 72 ALD 112 at [52]. In Conway v Repatriation Commission (2003) 37 AAR 486 at [9], Dowsett J also recognised that a realistic approach must be taken to this issue.

34.     In examining whether Mr Nielsen has made genuine attempts to engage in remunerative work, I am conscious that since 1991 or 1992 Mr Nielsen was living in a semi-rural area. This would present obvious difficulties for him in obtaining employment. I am also conscious that he confirmed in oral evidence that he had not registered for employment with any employment agency.

35.     Mr Nielsen had been continually employed in the Reserve until he had reached the compulsory retirement age of the Reserve in October 2004. In March 2004 he had previously lodged a claim for the grant of a disability pension. In October 2004 Dr Morris had reported that Mr Nielsen “has just recently retired” [ex. A, fol. 66]. Mr Nielsen gave no evidence of any attempt to obtain employment in 2004 following his retirement from the Reserve.

36.     The only evidence which concerned employment that Mr Nielsen gave related to his visit to his sister-in-law in 2005. He then assisted his nephew in his business for a week in Bowen. That visit appeared to be in or about February 2005. That was work of a labouring nature. In cross-examination he stated that he mowed a lawn a day. He also confirmed that his hip and right shoulder conditions, which were not accepted conditions, made this employment difficult for him to undertake. There was no evidence before me whether Mr Nielsen was paid for that work. I mention that Bowen is, of course, located at some considerable distance from his home. I regard his work in Bowen to be more a domestic arrangement with his nephew rather than any attempt at genuinely seeking to engage in remunerative work.

37.     Apart from Mr Nielsen’s visit to Bowen, there was no objective evidence before me of his active pursuit of work. After Mr Nielsen retired from the Reserve he certainly had the capacity to engage in employment. I am aware that Mr Nielsen has stated:  “I did not think that my PTSD symptoms were so bad that I could not continue to serve in the Air Force but for my other accepted disabilities” [ex. A3, para 11]. However, there is specialist psychiatric and orthopaedic evidence, which I have accepted, that Mr Nielsen was capable of employment at the time of his retirement from the Reserve. Dr Foxcroft had thought that Mr Nielsen could work 20 hours a week. Dr Morris thought that Mr Nielsen could work 40 hours a week.

38.     I therefore consider that after his retirement from the Reserve, Mr Nielsen had the capacity to work for, at least, 20 hours a week. This was not such a case as Spender J adverted to in Hall v Repatriation Commission (1994) 33 ALD 454 at 461 where a veteran was so incapacitated that any search for employment was “something of a charade”. This was instead a case where the veteran, who until his retirement from the Reserve had held a responsible position, and who was indeed capable of employment.

39.     I am conscious that Mr Nielsen has contended that he is only able to undertake labouring work and that he believes that the skills that he gained in the military are not readily transferable to civilian employment. I have taken a different view of his skills. I consider that the vocational skills that Mr Nielsen gained as a senior non-commissioned officer are much wider than he contends. I accept the view of Dr Morris that in 2004 Mr Nielsen could work in occupations such as a motel manager, taxi driver or a petrol station console operator. Mr Nielsen in his oral evidence has acknowledged that the position of Warrant Officer Disciplinary was a responsible position.  Whilst I have reservations about Mr Nielsen being comfortable as a taxi driver, I do consider that he could undertake some form of sedentary employment.

40.     I must also consider the psychiatric conditions of Mr Nielsen. In 2004 Dr Foxcroft, psychiatrist, diagnosed Mr Nielsen as suffering from alcohol dependence and post traumatic stress disorder. Dr Foxcroft was then of the opinion that Mr Nielsen could work for up to 20 hours per week [ex. A, T7, fol. 53]. However, recently Dr Harding, consultant psychiatrist, has reported that Mr Nielsen was now unfit to undertake any form of employment [ex. A4].

41.     I have not relied upon the conclusion of Dr Harding that Mr Nielsen is “unfit to work in any capacity for an employer” [ex. A4, p. 2]. This conclusion is based upon what Dr Harding perceives to be Mr Nielsen’s irritability, poor communications skills and his alcohol dependence. However, the report does not contain any detailed reasons for her conclusion. 

42.     Dr Foxcroft in his extremely comprehensive 2004 report had noted Mr Nielsen’s “general level of irritability, agitation and tendency to react inappropriately with work colleagues and peers” [ex. A, fol 53]; and yet had considered that Mr Nielsen had the capacity to work up to 20 hours per week.  I have placed reliance upon that report. I mention that the applicant did not require Dr Foxcroft to be present for cross-examination.

43.     I observe that Dr Harding was not prepared to give a firm diagnosis of Mr Nielsen’s psychiatric conditions, but instead gave her “impression” of the conditions of Mr Nielsen. Dr Harding did not express any disagreement with any aspect of the report of Dr Foxcroft.

44.     I am not satisfied that Mr Nielsen has been genuinely seeking to engage in remunerative work both within the meaning and spirit of s 24(2)(b) of the Act.

45.     This appears to me to be a case where Mr Nielsen retired once he received his military superannuation and his service pension. I am not satisfied that once he reached the age of compulsory retirement in the Reserve he had any intention of taking up employment.

46.     I also consider that Mr Nielsen has also not shown that his incapacity is the “substantial cause” of his inability to obtain remunerative work. In Fox v Repatriation Commission (1997) 45 ALD 317 at 320, Kiefel J had stated that there must be some “direct causal connection between the incapacity and the inability to obtain remunerative work”. I do not believe that this requirement is satisfied in this case.

47.     For these reasons I am not satisfied that that the ameliorative provisions in either s 24(1)(b) or s 23(3)(b) of the Act apply in this case. I find that Mr Nielsen is not qualified to receive a pension at either the special or intermediate rate of pension.

48.     I affirm the decision under review.

I certify that the 48 preceding paragraphs are a true copy of the reasons for the decision herein of Mr P McDermott RFD, Senior Member

Signed:         .....................................................................................
  Legal Research Officer

Date of Hearing  23 May 2007 
Date of Decision  21 June 2007
Counsel for the Applicant         Mr R Anderson 
Solicitor for the Applicant          Mr T O’Connor 
Respondent  Mr J Kelly, departmental advocate