Pressnell v FFS Trustee Corporation and Anor (Ruling)
[2015] VCC 63
•6 February 2015
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CIVIL DIVISION | Revised Not Restricted Suitable for Publication |
DAMAGES AND COMPENSATION LIST
GENERAL DIVISION
Case No. CI-14-03525
| CORINNE RACHAEL PRESSNELL | Plaintiff |
| v | |
| FFS TRUSTEE CORPORATION (ACN 118 202 672) | First Defendant |
| and | |
| AIA AUSTRALIA LIMITED (formerly AMERICAN INTERNATIONAL ASSURANCE COMPANY (AUSTRALIA) LTD) (ACN 004 837 861) | Second Defendant |
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JUDGE: | HER HONOUR JUDGE K L BOURKE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 17 October 2014 | |
DATE OF RULING: | 6 February 2015 | |
CASE MAY BE CITED AS: | Pressnell v FFS Trustee Corporation & Anor (Ruling) | |
MEDIUM NEUTRAL CITATION: | [2015] VCC 63 | |
RULING
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Subject:BREACH OF TRUST AND CONTRACT– SUPERANNUATION JURISDICTION OF THE COURT - ESTOPPEL
Catchwords: Application by the defendants seeking dismissal or permanent stay of proceedings – plaintiff’s claim under general law of trust and contract – Superannuation Complaints Tribunal Determination – res judicata, issue estoppel, Anshun estoppel – finality or conclusiveness – abuse of process – whether County Court should exercise its jurisdiction.
Legislation Cited: Superannuation (Resolution of Complaints) Act 1993 (Cth); Superannuation Industry (Supervision) Act 1993 (Cth); Trusts Act 1973 (Qld); Victorian Civil and Administrative Tribunal Act 1998, s148; County Court Civil Procedure Rules 2008, r23.01.
Cases Cited: Finch v Telstra Super Pty Ltd (2010) 242 CLR 254; Hannover Life Re of Australasia Ltd v Sayseng [2005] 13 ANZ Ins Cas 90-123; [2005] NSWCA 214; Attorney-General (Cth) v Breckler (1999) 197 CLR 83; Board of Trustees of the State Public Sector Superannuation Scheme v Edington [2011] 119 ALD 472; Edington v Board of Trustees of the State Public Sector Superannuation Scheme [2012] QSC 211; Port of Melbourne Authority v Anshun (1986) 84 FLR 169; Cox v Journeaux (No 2) (1935) 52 CLR 713; Federal Commissioner of Taxation v Munro (1926) 38 CLR 153; Wilkinson v Clerical Administrative and Related Employees Superannuation Pty Ltd (1998) 79 FCR 469; Shaw v Gadens Lawyers; Shaw v Rigby Cooke Lawyers [2014] VSCA 74; In the Marriage of Caddy v Miller (1985) 84 FLR 169; Equuscorp Pty Ltd & Anor v Acehand Pty Ltd & Ors [2010] VSC 89; Ramsay v Pigram (1968) 118 CLR 271; Kuligowski v Metrobus (2004) 220 CLR 363; Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853; Maurice Blackburn Cashman v Brown (2011) 242 CLR 647; [2011] HCA 22; Blair v Curran; Curran and Perpetual Trustee Co Ltd v Blair (1939) 62 CLR 464; Administration of the Territory of Papua and New Guinea v Daera Guba (1973) 130 CLR 353; WJ & F Barnes Pty Ltd v Federal Commissioner of Taxation (1957) 96 CLR 294; Comcare Australia v Grimes & Anor (1994) 50 FCR 60; Miller v University of New South Wales (2003) 132 FCR 147; (2003) 200 ALR 565; Thrasyvoulou v Secretary of State for the Environment [1990] 2 AC 273; [1990] 1 All ER 65; R v East Sussex County Council; Ex parte Reprotech (Pebsham) Ltd [2003] 1 WLR 348; [2002] 4 All ER 58; Ex parte Amalgamated Engineering Union (Aust Section); Re Jackson (1937) 38 SR (NSW) 13; Dey v Victorian Railways Commissioners (1949) 78 CLR 62; R v Clarkson [1987] VR 962; Attorney-General (NSW) v Watson (1987) 20 Leg Rep SL 1; R v Smith & Ors [1995] 1 VR 10; Hannover Life Re of Australasia Ltd v Colella [2014] VSCA 205; McArthur v Mercantile Mutual Life Insurance Company Limited [2002] 2 Qd R 197; Butcher v Port [1985] 1 NZLR 491; Edwards v Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61‑113; Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61-175; Wyllie v National Mutual Life Association of Australasia Ltd & Ors (1997) 217 ALR 324; Citicorp Life Insurance Ltd v Smith [2005] FCAFC 102; Colonial Mutual Life Assurance Society Limited v Brayley [2002] FCA 1333.
Judgment: Summons dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Kelsey-Sugg | Arnold Thomas & Becker Pty Ltd |
| For the Defendants | Mr P Lovell | Turks Legal |
HER HONOUR:
The application
1 By application by Summons dated 29 August 2014, the defendants sought dismissal or, alternatively, permanent stay of the Writ and Statement of Claim pursuant to Rule 23.01 of the County Court Civil Procedure Rules 2008.
2 Affidavits in support of the defendants’ Summons were sworn by the solicitor for the defendants, Ms Whittaker, on 16 September and 16 October 2014. Ms Treeby, solicitor for the plaintiff, swore affidavits in opposition on 26 September and 16 October 2014. Numerous documents were exhibited to these affidavits.
3 Detailed written submissions were provided by counsel for both parties citing extensive case law in relation to the relevant issues.
The proceeding
4 The plaintiff joined the First State Superannuation Scheme (“the Fund”) on 1 March 2005. Having been injured at work in August 2008, she claimed a Total and Permanent Disability (“TPD”) benefit from the defendants.
5 By her Statement of Claim and her Amended Statement of Claim, the plaintiff brings an action to obtain remedies to enforce compliance by the first defendant with the provisions of the Trust Deed and an action in contract against the second defendant.
6 It was not in dispute that as superannuation funds are constituted as trusts, they are subject to the general trust law and members (such as the plaintiff) may seek redress through the existing legal system by alleging breach of trust or breach of duty, rather than seeking a review by the Superannuation Complaints Tribunal (”the SCT”) pursuant to the Superannuation (Resolution of Complaints) Act 1993 (Cth) (“the SRC Act”).[1]
[1]SRC Act, s14
7 The first defendant had a duty to apply the trust assets in accordance with the Trust Deed. In performing that duty, it was required to inform itself properly of the relevant facts.[2] The first defendant was also required to act in good faith, on a real and genuine consideration of the material before it and for sound reasons, although it was not obliged to give reasons for its decision.[3]
[2]Finch v Telstra Super Pty Ltd (2010) 242 CLR 254 at [30]
[3]Hannover Life Re of Australasia Ltd v Sayseng [2005] 13 ANZ Ins Cas 90-123; [2005] NSWCA 214 per Santow JA at [32], with whom Spigelman CJ and Tobias JA agreed
8 The first defendant had other duties imposed on it by virtue of the Superannuation Industry (Supervision) Act 1993 (Cth) (“the SIS Act”). However, unlike the standard applicable under the SRC Act, under the general law, the first defendant had no obligation to form a fair and reasonable opinion.[4]
[4]Finch v Telstra Super Pty Ltd (supra) at [66]
9 The plaintiff also brought an action in contract against the second defendant.
The facts and the statutory scheme
10 On 22 December 2009, the plaintiff claimed a TPD benefit from the defendants.
11 From about 22 November 2010 to 9 December 2011, the plaintiff made further requests to the defendants to review their respective decisions to refuse to pay the TPD benefit.
12 On 31 January 2012, the plaintiff lodged a formal Complaint pursuant to s14 of the SRC Act with the SCT in respect of the previous decisions of the defendants.
13 The SCT is a federal administrative body established by s6 of the SRCAct. Its objectives include providing mechanisms for, amongst other things, the review of decisions or conduct to which complaints relate that are fair, economical, informal and quick.[5]
[5]SRC Act, s11, Attorney General (Cth) v Breckler (1999) 197 CLR 83 per Kirby J at [63]
14 The SRC Act is obviously intended to address the practical disadvantages which proceedings in the ordinary courts often have for people who become involved in a superannuation dispute. The SCT is a specialised, informal, economical tribunal with enhanced powers, facilities for conciliation and informal procedures.[6]
[6]Supra
15 The SCT has a limited jurisdiction. A person may only make a complaint to it that a decision made by the trustee of a fund, in relation to a member of a regulated superannuation fund, is or was unfair or unreasonable.[7] Also, a person may make a complaint to the SCT that a decision of an insurer in relation to a contract of insurance, where premiums are paid from an RSA,[8] is or was unfair or unreasonable.[9]
[7]SRC Act, s14; Breckler (supra) per Kirby J at [65]
[8]Retirement Savings Account
[9]SRC Act, s15J
16 If a complaint has been made to the SCT, and the complaint has not been withdrawn, and the SCT is satisfied it can deal with the complaint, the SCT must enquire into the complaint and try to settle it by conciliation.[10]
[10]SRC Act, s27
17 The SCT’s powers of review relevant to the plaintiff’s complaint are set out in s37 of the SRC Act. Section 37(1)(a) provides that:
“For the purpose of reviewing a decision of the trustee of a fund that is the subject of a complaint under section 14:
(a) the Tribunal has all the powers, obligations and discretions that are conferred on the trustee.”
18 If, as occurred in the plaintiff’s complaint, an insurer is joined as a party under s14 of the SRC Act, the SCT must, when reviewing the trustee’s decision, also review any relevant decision of the insurer, and for that purpose, the SCT has all the powers, obligations and discretions that are conferred on the insurer.[11]
[11]SRC Act, s37(2)
19 Pursuant to s37(3) of the SRC Act:
“On reviewing the decision of a trustee [or] insurer ... that is the subject of, or relevant to, a complaint under section 14, the Tribunal must make a determination in writing:
(a) affirming the decision; or
(b) remitting the matter to which the decision relates to the trustee [or] insurer ... for reconsideration in accordance with the directions of the Tribunal; or
(c) varying the decision; or
(d) setting aside the decision and substituting a decision for the decision so set aside.”
20 The SCT may only exercise its determination-making power under s37(3) for the limited purpose of placing a complainant (as nearly as practicable) in such a position that the unfairness, unreasonableness, or both, that the SCT has determined to exist in relation to the trustee’s decision that is subject of the complaint no longer exists.[12]
[12]SRC Act, s37(4)
21 The SCT must affirm a decision referred to under ss(3) if it is satisfied that the decision, in its operation in relation to the complainant, was fair and reasonable in the circumstances.[13] The SCT must give written reasons for its determination.[14]
[13]SRC Act, s37(6)
[14]SRC Act, s40
22 On 11 June 2014, the SCT affirmed the previous decision of the first defendant as trustee, and the second defendant as insurer, to reject the plaintiff’s claim for a TPD benefit.
23 The SCT’s determination is found in paragraphs 59 to 61 of its Reasons, under the heading ‘Determination of the Tribunal’.[15]
[15]See also paragraphs [5] to [6] of the SCT’s Reasons
24 Paragraphs 60 to 61 set out the following:
“60 Sub-section 37(6) of the Complaints Act provides that the Tribunal must affirm the decision under review if it is satisfied that the decision in its operation in relation to the Complainant was fair and reasonable in the circumstances. The Tribunal is so satisfied.
61 In accordance with the requirements of s37(3), (4) and (5) of the Complaints Act, it therefore affirms the decisions of the Trustee and the Insurer.”
25 The SCT’s ‘Deliberations’ were contained in paragraphs 53 to 58 of its Reasons. The relevant paragraphs 57 to 58 were as follows:
“57 The Tribunal has noted the medical opinions that support the view that the Complainant is TPD as well as the opinions indicating a work capacity given the Complainant’s range of training suitable for sedentary tasks. With such divergence of opinion the Tribunal looked carefully at the individual reports and sought to find a basis on which to place greatest emphasis. During the whole period relevant to this claim the most frequent ongoing contact and treatment was with Dr BT. As late as 10 May 2013 Dr BT advised that the Complainant did not satisfy the TPD definition.
58 Despite the significant divergence of medical opinion the Tribunal believes that on balance there is sufficient support for the view that the decisions of the Trustee and the Insurer cannot be regarded as unfair or unreasonable. For the reasons outlined above and having regard to evidence submitted, the Tribunal considers that the decisions of the Insurer and the Trustee to reject the Complainant’s claim for a TPD benefit were fair and reasonable in their operation in relation to the Complainant in the circumstances.”
26 On 19 June 2014, the SCT notified the plaintiff of her right to appeal to the Federal Court under s45 and s46 of the SRC Act if she was dissatisfied with the SCT’s determination on a question of law within 28 days of being given a copy of the Determination.
27 Instead of lodging an appeal, on 23 July 2014, the plaintiff filed proceedings in the County Court. Conditional appearances were filed on the defendants’ behalf in August 2014.
The Defendants’ submissions
JURISDICTION
28 Whilst the defendants accepted a right of appeal was permitted to the Federal Court pursuant to the SRC Act on a question of law, it was submitted this appeal mechanism within the SRC Act operated to oust the jurisdiction of the ordinary courts to adjudicate on separate rights under the general law.
29 It was submitted there was no authority, process or mechanism in the SRC Act by which the plaintiff could simply ignore or reject her rights of appeal and, instead, commence a fresh proceeding in the County Court as if the complaint to the SCT had never been made, considered and determined. Where an Act (such as SRCAct) provides a procedure for review or appeal, that procedure must be followed.
30 Thus, it was submitted that the Determination could only be challenged through the review or appeal process.
31 Counsel relied upon the High Court’s comments in Breckler:[16]
“Conferral upon the Determination of the Tribunal of the status of a decision of the Trustee does not bring with it a preclusive effect which immunises the Determination, and thus its status, from attack in properly constituted curial proceedings. The scope and range of such proceedings was indicated earlier in the reasons.”
[16](Supra) at [46]
32 It was submitted the scope and range of the proceedings referred to in the quoted excerpt appears to refer to “… decisions defining the scope for challenges in courts of equity to the exercise of discretions reposed in the trustee of a settlement”.[17]
[17]Breckler (supra) at [7]
33 It was submitted it was therefore clear that where the SCT affirmed, varied or makes a decision in substitution for a trustee or insurer’s decision, that decision is not then immune to attack in properly constituted curial proceedings, here being an appeal in the Federal Court.
34 Separately, the SCT was established under the SRC Act to provide a “free” process for reviewing decisions in relation to complaints made to superannuation trustees and insurers. The plaintiff chose to review the decisions of the defendants by the SCT free review process in accordance with the SRC Act.
35 However, notwithstanding the plaintiff’s entitlement to seek review of the defendants’ decisions via a court process instead of via the SCT, the SRC Act does not provide that opportunity in circumstances where a superannuation member (here the plaintiff) has chosen and ventured along the SCT pathway.
36 Finally, it was submitted that there was nothing in the SRC Act, or indeed the SIS Act which expressly permits departure from the Federal Court appeal process enshrined in the SRC Act in favour of instituting a fresh proceeding in the County Court in lieu of appeal. Furthermore, there does not appear to be any case authority in support of the plaintiff being able to do so.
37 Counsel for the defendants referred to the decision of the Queensland Supreme Court in Edington v Board of Trustees of the State Public Sector Superannuation Scheme.[18]
[18](2012) QSC 211
38 Although the Court in that case did not grant an application to strike out, set aside or permanently stay a proceeding under s8 of the Trusts Act 1973 (Qld), the case was distinguishable from the current proceeding, as the applicant in Edington had exhausted all his appeal rights to the Federal Court and the Full Federal Court following a similar affirmation by the SCT.
39 Further, Counsel for the defendants submitted the action under the Trusts Act 1973 (Qld) differed to the current proceeding in which the plaintiff did not seek to challenge the defendants’ decisions under any law separate from that already considered by the SCT. Finally, the Trustees in Edington were seeking summary judgment rather than proceeding on the basis of issue or Anshun[19] estoppel.
[19](1981) HCA 45; (1981) 147 CLR 589
The Plaintiff’s submissions
40 In response, Counsel for the plaintiff submitted that no authority was cited which supports the proposition that an appeal mechanism within an Act operates to oust the jurisdiction of the ordinary courts to adjudicate on separate rights under general law.
41 It was submitted that, only in exceptional circumstances will a civil proceeding be stayed on the ground that it constitutes an abuse of process.[20] As the power to grant a permanent stay is a power to refuse to exercise jurisdiction, the power is exercised sparingly and with the utmost caution.[21]
[20]Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 92; [1949] ALR 333 per Dixon J; R v Clarkson [1987] VR 962 at 973
[21]Attorney-General (NSW) v Watson (1987) 20 Leg Rep SL 1 per Mason CJ, Wilson and Dawson JJ
42 As Dixon J said in Cox v Journeaux (No 2):[22]
“The principle, in general paramount, that a claim honestly made by a suitor for judicial relief must be investigated and decided in the manner appointed, must be observed.”
[22](1935) 52 CLR 713 at 720, Brooking J applied similar principles in R v Smith & Ors (1995) 1 VR 10 at 14
43 Whilst it was submitted the SCT was established to address the practical disadvantages which proceedings in the ordinary courts can have for people such as the plaintiff,[23] nothing in the legislative scheme suggests that a determination by the SCT operates to supplant litigation in the courts for breach of trust against a fund trustee or for breach of contract against an insurer.
[23]Breckler (supra) per Kirby J at 117, [62]
44 On the contrary, as the High Court majority said in Breckler:[24]
“In Federal Commissioner of Taxation v Munro, Isaacs J gave as examples of functions which are appropriate exclusively to judicial action not only the determination of criminal guilt but also actions in contract and tort. These examples indicate a view of what, at least by reference to history and tradition, are basic rights and interests necessarily protected and enforced by the judicial branch of government. To those examples there may readily be added suits to obtain remedies to enforce compliance by a trustee with the terms of the trust in question. The institution of the trust had its genesis in curial enforcement of the trust and confidence reposed by the settlor in the holder of the legal estate.
In Wilkinson v Clerical Administrative and Related Employees Superannuation Pty Ltd, Heerey J correctly stressed that the rights of members of superannuation funds arise from and are governed by the general law which is enforceable in the ordinary courts and that the rights of members of such funds are not derived from a statute which itself confers an administrative power of modification or destruction. ... .”
[24](Supra) at 109, [40]–[41]
45 As Kirby J stated in Breckler, the Parliament recognised that the SCT would not be a panacea for righting every wrong that may be complained of by fund members. The legislative scheme recognises that access to the courts concerning disputes about superannuation and insurance will continue to occur, and that the SCT will be subordinate to the courts.[25]
[25]Breckler (supra) per Kirby J at 60
46 Counsel for the plaintiff submitted the matters raised by the defendants set out in paragraphs 31 to 33 of this Ruling revealed a misunderstanding of the nature of the plaintiff’s proceedings in this Court. The plaintiff in these proceedings does not seek to challenge the SCT’s determination. Rather, she seeks to exercise her rights under the general law of trust and contract, rights she did not relinquish by bringing a complaint to the SCT.
47 I accept the submissions by counsel for the plaintiff in relation to this jurisdictional issue.
48 In my view, the plaintiff retains the right to exercise her general law rights against the defendants in trust and contract, as she seeks to do in this Court, although she has been unsuccessful at the SCT and not appealed to the Federal Court pursuant to the SRC Act.
49 The right to appeal to the Federal Court on a question of law does not extinguish the plaintiff’s rights at general law nor are they relinquished by seeking review at the SCT where the ground of review is limited to the “fairness and reasonableness” of the trustee and insurer’s decision as to the plaintiff’s TPD entitlement.
50 The SRC Act simply sets out a review process by the STC and review on a question of law by the Federal Court. The Act is silent as to what, if any, affect taking this course, or part thereof, has on a complainant’s general law rights.
51 While it is conceded by the courts that legislation can override the common law, the courts require that it be clearly shown that the legislation intended to do so – hence the adoption of two closely related presumptions: legislation is presumed not to alter common-law doctrines and legislation is presumed not to invade common-law rights.[26]
[26] Pearce ‘Statutory Interpretation in Australia’ (8th ed) p236
52 Accordingly, in the absence of any legislative intention to override the general law rights, I am not satisfied the jurisdiction of this Court is ousted as a result of the course taken by the plaintiff in seeking limited review pursuant to the SRC Act.
ESTOPPEL
The Defendants’ submissions
53 The other main ground of the defendants’ application was that the proceeding in the County Court was a second attempt by the plaintiff to litigate matters already resolved. It was submitted the subject of this proceeding had been well dealt with by the SCT.
54 It was submitted that by commencing the proceeding in this Court, the plaintiff was in effect “forum shopping”.
55 It was submitted that this matter was essentially indistinguishable from Shaw v Gadens Lawyers; Shaw v Rigby Cook Lawyers,[27] wherein it was held that a litigant was estopped from bringing court proceedings relitigating the dispute outside the Supreme Court in accordance with the procedure set out under s148 of the Victorian Civil and Administrative Tribunal Act 1998 (“the VCAT Act”).
[27](2014) VSCA 74
56 Counsel for the defendants referred to the plaintiff’s Statement of Claim, submitting that various documents relied upon by the plaintiff in support of her claim had previously been submitted to the SCT or could have been so.
57 It was submitted the plaintiff had every opportunity to bring to the attention of the SCT alleged breaches by the defendants of various duties alleged to be imposed upon them as set out in the Statement of Claim but she did not do so.
58 Further, it was submitted the plaintiff relies on the same medical evidence in support of her allegations in this proceeding that she relied upon in her complaint to the SCT. She also relies upon the Trust Deed pertaining to the Health Super Fund and a copy of the Policy Document pertaining to the relevant insurance policy.
59 It was submitted, to the extent that the allegations and issues raised in these proceedings are perhaps not materially identical in fact and law to the allegations made and issues raised before the SCT, the plaintiff had every opportunity to raise and ventilate such issues before the SCT.
60 Counsel for the defendants submitted the principles of res judicata and Anshun estoppel apply in this proceeding.
61 Res judicata presupposes that, as between two or more opposing parties, there is:
(a) a definite issue between them; and
(b) there is a tribunal – here the SCT – competent to decide the issues; and
(c) within its competence, the SCT has done so, as it did by its determination;
(d) the determination (here) was final and on the merits save for proper appeal; and
(e) the determination determined the same questions as raised in this proceeding and the parties are the same in each proceeding.
62 It was submitted that once a matter or issue between the parties has been litigated and decided, it cannot be raised again by the same party, except here by way of appeal on a question of law to the Federal Court, as expressly permitted by the SRC Act.
63 Further, Counsel for the defendants relied on the rule of estoppel by res judicata which prevents a party from presenting or introducing evidence aimed at disputing the correctness or merits of an earlier decision in proceedings between the same parties about the same issue.
64 As the Court noted in Caddy & Miller (in the marriage of),[28] the doctrine reflects the general interest of the community in the termination of disputes and in the finality and conclusiveness of judicial decision, together with the right of the individual litigant to be protected from multiple suits for the same cause.
[28](1986) 84 FLR 169
65 Counsel for the defendants also submitted the principles of an Anshun[29] estoppel applied in this case, citing Hollingworth J in Equuscorp Pty Ltd & Anor v Acehand Pty Ltd & Ors,[30] where her Honour briefly stated:
[29]Supra
[30][2010] VSC 89 (30 March 2010) at [23]
“An Anshun estoppel may arise where a matter sought to be raised by way of claim or defence in a later proceeding is so closely connected with the subject matter of an earlier proceeding, that it was to be expected that it would have been relied upon in that earlier proceeding. No such estoppel arises unless it appears that the matter relied upon in the later proceeding was ‘so relevant to the subject matter of the first action that it would have been unreasonable not to rely upon it’.”
And at paragraphs [26]-[27]:
“… the question is not whether it would have been reasonable for the person in the present plaintiffs’ position to have taken a different course, but whether it was unreasonable for that person to pursue the course of action which they in fact took.
… It seems that an Anshun estoppel may arise even though the parties to the second proceeding are not the same as the first.”
66 In this proceeding, of course, the parties are identical.
67 Accordingly, for reasons previously stated, it was submitted by Counsel for the defendants that the issues raised in this proceeding have been determined by the SCT such that they ought not be raised again in the County Court, particularly in circumstances where the plaintiff has chosen not to pursue her available appeal rights to the Federal Court as permitted and notified under the SRC Act in the SRC’s letter of 19 June 2014.
68 In the alternative, it was submitted the plaintiff is estopped on the basis of Anshun estoppel from raising any matter which could have been raised in the SCT proceeding but was not so raised.
The Plaintiff’s submissions
69 It was submitted on the plaintiff’s behalf that the defendants have cited no authority which supports the proposition that a determination of the SCT can, as a matter of principle, give rise to issue estoppel or Anshun estoppel.
70 Even if a determination of the SCT can, as a matter of principle, give rise to either an issue estoppel or Anshun estoppel, determinations of the SCT lack the qualities of finality and conclusiveness.
71 In the alternative, if determinations of the SCT are final and conclusive, they are only final and conclusive as to matters within the SCT’s jurisdiction to decide.
72 It was submitted that nowhere in the SCT’s Reasons, does the SCT express any view or make any finding as to:
· The validity under general law of the decision-making process that was undertaken by the trustee and insurer in reaching the relevant decisions.
· Whether the complainant was TPD and, if so, when she became TPD.
73 It was submitted it was those issues that the plaintiff sought adjudication on in this Court.
74 Counsel for the plaintiff also cited authorities in relation to issue estoppel, relying on the decision of the High Court in Kuligowski v Metrobus,[31] where Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ said, at 373:
“In his speech in Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853 at 935, Lord Guest, after noting that the doctrine of issue estoppel had been accepted by Australian courts for a number of years, indicated that, for the doctrine to apply in the second set of proceedings, the requirements were:
‘(1) that the same question has been decided; (2) that the judicial decision which is said to create the estoppel was final; and, (3) that the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel is raised or their privies.’”
[31](2004) 220 CLR 363
75 It was submitted on the plaintiff’s behalf that the defendants have not, and cannot establish (1) and (2).
76 For issue estoppel to arise, the issue or question said to be the subject of the estoppel must be identical in each case.[32] The requirement is a strict one.[33]
[32]Ramsay v Pigram (1968) 118 CLR 271, per Barwick CJ at 276 (cited in Kuligowski at 379)
[33]Kuligowski (supra) at 381
77 The issue for the SCT was limited to whether, based on the information before it, the decisions under review were “fair or reasonable” in the circumstances.[34]
[34]SRC Act, s14, s37(4), s37(6); Board of Trustees of the State Public Sector Superannuation Scheme v Edington & Anor [2011] 119 ALD 472
78 It was submitted the validity under general law of the decision-making process that was undertaken by the trustee and insurer in reaching the relevant decisions was not an issue before the SCT. Nor was the question whether the complainant was in fact TPD.
79 Further, the decisions the subject of these proceedings are not the same as the decisions under review by the SCT. The SCT performs a function fundamentally different to that of an ordinary court.
80 It was clearly stated by Kirby J in Breckler that the element of conclusiveness is missing from determinations of the SCT.[35]
[35]Per Kirby J at 101
81 Further, it was submitted various provisions of the legislative scheme suggest that the SCT’s determinations were not intended to be final or conclusive in any sense. For example:
· Section 55(3) of the SIS Act provides:
“…a person who suffers loss or damage as a result of conduct of another person that was engaged in in contravention of subsection (1) [36]may recover the amount of the loss or damage by an action against that other person or against any person involved in the contravention”;
[36]A person must not contravene a covenant contained, or to be taken to be contained in, the governing rules of a superannuation entity.
and
· Section 350 of the SIS Act provides:
“It is the intention of the Parliament that this Act is not to apply to the exclusion of a law of a State or Territory to the extent that that law is capable of operating concurrently with this Act.”
82 Even if SCT determinations are final and conclusive in the sense required to found an estoppel, it was submitted that they could only be final and conclusive in relation to the matters falling within its jurisdiction – that is, whether the decisions under review (as opposed to the process which led to those decisions) were unfair or unreasonable.
83 In Maurice Blackburn Cashman v Brown,[37] French CJ, Hayne, Crennan, Kiefel and Bell JJ said:
“It is a necessary condition for an issue estoppel to exist between parties that the decision from which the estoppel arises was a final decision. (See, for example, Blair v Curran; Curran and Perpetual Trustee Co Ltd v Blair (1939) 62 CLR 464 at 531-532 per Dixon J; [1939] HCA 23; Administration of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 453 per Gibbs J; [1973] HCA 59; Kuligowski v Metrobus (2004) 220 CLR 363 at 373 [21], 375 [25] per Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ; [2004] HCA 34). Where, as here, the statute establishing the body in question prescribes that its decisions are final for the purposes of that Act, no greater ambit of finality should be attributed to its decisions than the Act itself marks out. Thus no estoppel arises because the quality of “finality” which the Act gives to an opinion expressed by a Medical Panel (in this case under s 104B(9)) is finality for the purposes of determining any question or matter arising under or for the purposes of the Act. No wider finality should then be ascribed to a Panel’s opinion.”
[37](2011) 242 CLR 647; [2011] HCA 22 at [40]
84 For similar reasons, it was submitted that no Anshun estoppel arises in the current proceeding.
85 It was submitted the SCT determination was not giving rise to an estoppel in this case as the SCT’s functions are arbitral, not judicial.[38] Thus, as a matter of principle, determinations of the SCT are incapable of giving rise to an issue estoppel.
[38]Breckler (supra)
86 In WJ & F Barnes Pty Ltd v Federal Commissioner of Taxation,[39] Kitto J said, in relation to a decision of a Taxation Board of Review:
“We know that the board of review, when considering the company’s assessment to ordinary income tax, considered that the payments were not allowable deductions on any ground. The board’s decision was not, of course, an adjudication; it was administrative in character, and could not create an issue-estoppel.”
(emphasis added).
[39](1957) 96 CLR 294 at 314-315
87 Counsel for the plaintiff cited the following authorities in this regard.
88 In Comcare Australia v Grimes & Anor,[40] Wilcox J considered “‘plainly correct” a concession by counsel that an AAT decision could not give rise to an issue estoppel.
[40](1994) 50 FCR 60
89 In Miller v University of New South Wales,[41] Ryan and Gyles JJ considered whether a decision of the AIRC was a “judicial determination” which could give rise to an issue estoppel in a proceeding in the Federal Court.
[41](2003) 132 FCR 147; (2003) 200 ALR 565 at [48]-[68]
90 Having discussed the relevant authorities, their Honours said:[42]
“Cases which concern a tribunal which is truly administrative in the sense that it stands in the shoes of the original administrative decision-maker, and has power to substitute its own decision for the original decision, may be left to one side for present purposes, as this is not such a case. The bald statement by Kitto J in Barnes v FCT and the finding by Davies and Spender JJ in Sande may be decisive of such a case, at least at the level of this court, although it will be necessary to consider the implications of the decision of the House of Lords in Thrasyvoulou v Secretary of State for the Environment [1990] 2 AC 273 ; [1990] 1 All ER 65 in an appropriate case: cf R v East Sussex County Council; Ex parte Reprotech (Pebsham) Ltd [2003] 1 WLR 348 ; [2002] 4 All ER 58 …
While estoppels may arise from decisions of bodies other than superior courts of record, and the language of res judicata, including cause of action estoppel and issue estoppel, is used in this connection, the starting point is to decide precisely what jurisdiction the body is exercising, as lucidly explained by Jordan CJ in Ex parte Amalgamated Engineering Union (Australian Section); Re Jackson at 19-20 as follows:
‘But in order that a judicial decision may involve an estoppel as to the matter decided, it is necessary that the tribunal should possess jurisdiction to decide the matter conclusively and for all purposes between the parties, and not merely incidentally and for a limited purpose. In the case of a superior Court, difficulties can seldom arise as to whether estoppel attaches to matters which have been expressly or impliedly decided for the purpose of the direct and immediate decision. This is by reason of the rule that ‘nothing shall be intended to be out of the jurisdiction of a superior Court, but that which specially appears to be so’. But difficulties do occur in the case of subordinate tribunals. Where these have been invested with a general, though limited jurisdiction, matters incidentally decided are res judicata if they are comprised within the limits of the general jurisdiction of the tribunal. Where, however, a special jurisdiction is conferred upon a subordinate tribunal to decide some one particular class of matter, the conferring of jurisdiction, although it authorises the tribunal to decide any other matters so far as may be necessary for the exercise of the jurisdiction so conferred, is not regarded as investing it with jurisdiction to decide those matters between the parties conclusively and for all purposes. Such matters are collateral to the matter as to which jurisdiction is conferred. In a particular case it may appear from the Statute conferring the jurisdiction that it is intended that the tribunal shall have jurisdiction to determine the collateral matter only provisionally and subject to control by means of the prerogative writs. Or it may appear to be intended that the tribunal is to determine the collateral matters conclusively so far as any control by superior Courts is concerned. But unless an intention appears to confer jurisdiction to determine the collateral matters inter partes conclusively and for all purposes, a decision of the tribunal upon a collateral matter lying outside its special jurisdiction creates no estoppel, notwithstanding that the matter was raised and that it was necessary to form an opinion upon it for the purpose of deciding the matter in which the tribunal is invested with special jurisdiction. The reason is that no estoppel can arise from a decision by a tribunal of limited jurisdiction of a matter lying outside its jurisdiction’.”
[citations omitted]
[42]Miller v University of New South Wales (supra) at [63]-[65]
91 Leaving aside the question of estoppel, it was submitted on the plaintiff’s behalf that it is not an abuse of process for a person to seek access to the ordinary courts after having failed at the SCT. A litigant such as the plaintiff should not be refused access to the ordinary courts merely because she is persistent.
92 It was submitted these proceedings are not an attempt to re-litigate previously determined issues. The issues here are different to those that were before the SCT.
93 Nor is the plaintiff seeking impermissibly to “forum-shop” as submitted by Counsel for the defendants, who described Shaw v Gadens Lawyers; Shaw v Rigby Cooke Lawyers[43] as being an “essentially indistinguishable” case.
[43]Supra
94 To the contrary, it was submitted on the plaintiff’s behalf that Shaw is readily distinguishable, because:
· it concerned a completely different tribunal established under a different legislative regime;
· unlike these proceedings, Mr Shaw’s common-law proceedings sought to re‑litigate the same matters already dealt with by VCAT;
· the appellant in Shaw was an unrepresented litigant.
95 It was submitted the public interest in finality in civil litigation would not be served by this Court refusing to exercise its jurisdiction.
96 A wider review is sought in this Court than that open to the SCT – the decision-making process not just the decision is relevant to the Court’s consideration in this proceeding.
97 It was submitted the relevant definition of TPD in the insurance policy made payment of the TPD benefit conditional on the formation of an opinion by the insurer that the plaintiff was disabled to the requisite degree.
98 It was submitted by Counsel for the plaintiff that it is well-established that when a court has before it such a TPD definition, the court does not simply substitute its own opinion for that of the insurer. Only if the insurer’s opinion is found to have been wrongly formed, has the court proceeded to determine the question of TPD for itself.[44]
[44]Hannover Life Re of Australasia Ltd v Colella [2014] VSCA 205, per Beach JA at [6] (Ashley JA and Garde AJA agreeing); Hannover Life Re of Australasia Ltd v Sayseng (supra), per Santow JA (Spigelman CJ and Tobias JA agreeing); McArthur v Mercantile Mutual Life Insurance Company Limited [2002] 2 Qd R 197, per McPherson JA at 205 (applying Butcher v Port [1985] 1 NZLR 491) and Muir J at 218; Edwards v Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61-113, per McLelland J; Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61-175, per Hodgson J; and Wyllie v National Mutual Life Association of Australasia Ltd & Ors (1997) 217 ALR 324, per Hunter J
99 As these authorities demonstrate, a consideration of whether the insurer’s opinion was wrongly formed necessarily involves the Court examining the insurer’s decision-making process, as distinct from the decision itself.
100 Thus, the breaches of duty alleged by the plaintiff against the insurer at paragraph [38] of her Amended Statement of Claim are largely directed to the insurer’s decision-making process.
101 It has been held that the words “the decision … was fair and reasonable” in s37(6) of the SRC Act are directed to whether the actual decision, rather than the process that led to it, was fair and reasonable.[45]
[45]Citicorp Life Insurance (supra) at [9]; and Colonial Mutual Life Assurance Society Limited v Brayley (supra) at [31] per Branson J
102 Whilst both Counsel relied upon various passages in Breckler, other comments of Kirby J are relevant to a consideration of the issue of estoppel and whether the proceedings in this Court are in fact a relitigation of the same issue already dealt with by the SCT as submitted by Counsel for the defendants.
103 Having found that the SCT’s power was arbitral, not judicial, Kirby J detailed noted the history of the superannuation law supplementing the general law in terms of actions against a trustee for breach of trust.[46]
[46]Brecker (supra) at 115
104 The SRC Act, as Kirby J described, was one of a number of recent laws enacted by Parliament concerning superannuation. He noted that by the 1990s, with increasing numbers of retirees in Australia, huge funds invested in superannuation, and variable standards observed by trustees, the industry began to attract federal legislation.[47]
[47](Supra) at [57]
105 One Act was the SIS Act which must be read with the SRC Act in order to understand how compliance with the SCT’s determinations, enforced in accordance with the SRC Act, were intended to contribute to, and reinforce, the supervision of the superannuation industry and to attain improved standards within it, as envisaged by the SIS Act.
106 Kirby J noted that before the creation of the SCT, disputes between beneficiaries, trustees and insurers concerning superannuation were decided, where necessary, by courts of competent jurisdiction, applying to the problem in hand the general law relating to trusts, contracts, insurance and so forth. The grounds for challenge to the exercise by trustees of the powers reposed in them, particularly if the trustees gave no reasons for their decision, were limited.[48]
[48](Supra) at [58]
107 The circumstances in which relief could be obtained from a court were accurately summarised in Wilkinson.[49] They did not extend to cases where the decision of the trustee was criticised as unfair or unreasonable or unwise.[50]
[49]Wilkinson v Clerical Administrative and Related Employees Superannuation (1998) 79 FCR 469 at 480
[50](Supra) at 58]
108 Kirby J noted that the confined circumstances in which courts could intervene in this class of case, and the increasing importance of superannuation funds to society, appear to have propelled the legislature into establishing the SCT.
109 Having stated it was clear enough Parliament recognised that the SCT would be the panacea for righting all wrongs that may be complained of by fund members, Kirby J noted the SRC Act expressly contemplated that the SCT would have a relationship with the courts and be subordinate to them.
110 Kirby J referred to s123 of the SRC Act which provides for an appeal to the Federal Court on a question of law. Section 126 provides the SCT may not deal with a complaint if a proceeding has begun in a court about the subject matter of the complaint and the proceeding has not been finally disposed of.
111 Kirby J noted these provisions recognise that access to courts concerning disputes relating to superannuation will continue to occur and have initial primacy over proceedings before the SCT. Its limited powers are narrowed still further, yet within its defined area of jurisdiction, the SCT enjoys powers extending (in a respect relevant to the present proceedings) beyond the powers enjoyed by courts of law dealing with a complaint against a decision of a trustee.[51]
[51](Supra) at [61]
112 I accept that the issue before this Court is not the same as the issue dealt with by the SCT – namely whether the defendants’ decision was fair and reasonable. That issue is solely and exclusively within the domain of the SCT not the general law as Kirby J explained.
113 Because of the SCT’s limited jurisdiction, the plaintiff was not capable of raising before it the alleged breaches by the defendants of various duties alleged to be imposed upon them as contained in the Statement of Claim
114 Further, in this proceeding, the Court can take into account the decision-making process not only whether the actual decision was fair and reasonable.[52]
[52]Citicorp Life Insurance Ltd v Smith (2005) FCAFC 102 at [19] and Colonial Mutual Life Assurance Society Ltd v Brayley (2002) FCA 1333 at [31] per Branson J
115 Of course the plaintiff in this proceeding will rely on material which was before the SCT, but the issue for consideration is a different one.
116 Not only has the same question before this Court not already been decided by the SCT, the SCT’s Determination lacks the finality and conclusiveness required for issue estoppel to apply.
117 Accordingly, the plaintiff is not estopped from bringing the proceedings in this Court.
118 The defendants’ Summons is therefore dismissed.
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