Reid v Secretary, Department of Family and Community Services
[2001] FCA 794
•29 JUNE 2001
FEDERAL COURT OF AUSTRALIA
Reid v Secretary, Department of Family & Community Services [2001] FCA 794
SOCIAL SECURITY – disability support pension – effect of receipt of periodic payments under a State Act – time at which entitlement to pension to be determined
Social Security Act 1991 (Cth) ss 114, 1163A, 1165, 1168
Social Security (Budget and Other Measures) Legislation Amendment Act 1993 (Cth)
Social Security Legislation Amendment (Carer Pension and Other Measures) Act 1995 (Cth)
Workers Rehabilitation and Compensation Act 1986 (SA) s 42AColeman v Shell Company of Australia Ltd (1943) 45 SR (NSW) 27, considered
Robertson v City of Nunawading [1973] VR 819, considered
Hill v Workers Rehabilitation and Compensation Corporation (1997) 191 LSJS 300, cited
Maxwell v Murphy (1957) 96 CLR 261, cited
Fisher v Hebburn Ltd (1960) 105 CLR 188, citedKEVIN JAMES REID v SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
S4 of 2001BRANSON, LINDGREN and MANSFIELD JJ
ADELAIDE
29 JUNE 2001
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
S4 of 2001
ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
KEVIN JAMES REID
APPELLANTAND:
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
RESPONDENTJUDGES:
BRANSON, LINDGREN and MANSFIELD JJ
DATE OF ORDER:
29 JUNE 2001
WHERE MADE:
ADELAIDE
THE COURT ORDERS THAT:
1.The appeal be dismissed.
2.The appellant pay the respondent’s costs.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
S4 of 2001
ON APPEAL FROM A JUDGE OF FEDERAL COURT OF AUSTRALIA
BETWEEN:
KEVIN JAMES REID
APPELLANTAND:
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
RESPONDENT
JUDGES:
BRANSON, LINDGREN and MANSFIELD JJ
DATE:
29 JUNE 2001
PLACE:
ADELAIDE
REASONS FOR JUDGMENT
BRANSON and MANSFIELD JJ:
INTRODUCTION
This is an appeal from a decision of a judge of the Court (von Doussa J) which allowed an appeal from a decision of the Administrative Appeals Tribunal (“the AAT”) and restored an earlier decision of the Social Security Appeals Tribunal.
The question of law which was considered by von Doussa J concerned the proper construction and operation of ss 1163A and 1165 of the Social Security Act 1991 (Cth) (“the Act”). These sections are contained in Part 3.14 of the Act which is concerned with the impact of a person’s entitlement to receive, or actual receipt of, compensation (as defined by s 17(2) of the Act), on that person’s right to receive payments under the Act. Sections 1163A and 1165 are concerned to prevent what is known as “double dipping”. That is, they are designed to prevent a person receiving, in respect of any period of time, both what would otherwise be his or her full entitlements under the Act and payments of compensation.
BACKGROUND FACTS
The appellant (“Mr Reid”) sustained a compensable disability arising out of or in the course of his employment that resulted in his incapacity for work for a period that exceeded two years. On 6 November 1990 he made a claim for compensation under the Workers Rehabilitation and Compensation Act 1986 (SA) (“the State Act”). Weekly payments of income maintenance were made to him under the State Act from 6 November 1990 until 29 March 1995.
On 15 March 1995 WorkCover Corporation (“WorkCover”), the body responsible for administering the State Act, exercised its entitlement under s 42A of the Act of the State Act to assess Mr Reid’s loss of future earning capacity as a capital loss (s 42A(1) of the State Act). Subs 42A(4) of the State Act authorised WorkCover to “make one or more interim assessments of loss as to nominated portions of the worker’s notional working life before making a final assessment of loss under this section”. Having notified Mr Reid of its decision to proceed under s 42A, WorkCover made four interim payments to him as follows:
· on or about 15 March 1995, an interim payment of $18,636.69 for the period 30 March 1995 to 27 March 1996;
· on or about 26 March 1996, an interim payment of $18,876.53 for the period 28 March 1996 to 26 March 1997;
· on or about 19 March 1997, an interim payment of $19,056.46 for the period 27 March 1997 to 25 March 1998; and
· on or about 4 March 1998, an interim payment of $19,329 for the period 26 March 1998 to 24 March 1999.
On 30 January 1998 Mr Reid applied under the Act for a disability support pension.
On 5 March 1998 a delegate of the respondent (“the Secretary”) made a decision to treat the payments made to Mr Reid as a result of the interim assessments in respect of the periods commencing on 27 March 1997 and 26 March 1998 as “periodic payments under a law of a State” within the meaning of subs 1163A(1) of the Act. As a consequence, by reason of the operation of s 1168 of the Act, the disability support pension to which Mr Reid would otherwise have been entitled was reduced to nil during the periods in respect of which the interim assessment had been calculated under the State Act.
Mr Reid challenged the decision of the delegate of the Secretary on the ground that s 1163A of the Act had no application in the circumstances of his case. The delegate’s decision was reconsidered and upheld, upheld again by a Review Officer and further upheld by the Social Security Appeals Tribunal. Upon the decision of the Social Security Appeals Tribunal being reviewed by the AAT, the AAT considered that the case was covered by s 1165 of the Act with the consequence that s 1163A had no application. As is mentioned above, the Secretary appealed against the decision of the AAT contending that Mr Reid’s situation was covered by s 1163A of the Act and that the original decision of the delegate of the Secretary was correct. The learned primary judge allowed the appeal, set aside the decision of the AAT and restored the decision of the Social Security Appeals Tribunal. It is from his Honour’s judgment that this appeal is brought.
STATUTORY PROVISIONS
At the time that Mr Reid applied under the Act for a disability support pension, s 1163A, subss 1165(1), (3) and (4) and subs 1168(1) of the Act provided:
“1163A Certain lump sums to be treated as though they were received as periodic payments
1163A(1) If:
(a)a person is entitled to periodic payments under a law of a State or Territory; and
(b)the person’s entitlement to the periodic payments is converted under the law of the State or Territory into an entitlement to a lump sum; and
(c)the lump sum is calculated by reference to a period;
this Part applies to the person as if:
(e) that person had not received:
(i)the lump sum; or
(ii)if the lump sum is to be paid in instalments – any of the instalments; and
(f)the person had received in each fortnight during the period a periodic compensation payment equal to:
lump sum amount______
number of fortnights in the periodwhere:
lump sum amount is the amount of the lump sum referred to in paragraph (b).
number of fortnights in the period is the number of whole fortnights in the period referred to in paragraph (c).
1163A(2)This section does not apply in respect of a lump sum to which a person is entitled if section 1165 applies in respect of the lump sum.
1165Compensation affected payment not payable during lump sum preclusion period
1165(1) Where:
(a)a person receives or claims a compensation affected payment; and
(b)the person is not a member of a couple; and
(c)the person receives a lump sum compensation payment (whether before or after the person receives or claims the compensation affected payment) before 20 March 1997;
a compensation affected payment referred to in paragraph (a) is not payable to the person for the old lump sum preclusion period.
1165(3)If periodic compensation payments are made in respect of the lost earnings or lost earning capacity, the old lump sum preclusion period is the period that:
(a) begins on the day after the last day of the periodic payments period; and
(b)ends after the number of weeks specified in subsection (4).
1165(4)The number of weeks in the old lump sum preclusion period is the number worked out under the following formula:
compensation part of lump sum
average weekly earnings1168Rate reduction of certain compensation affected payments where periodic compensation payments have been received
1168(1) Subject to subsection (4), (5), (6) and (7), if:
(a)a person … receives a series of periodic compensation payments; and
(b)the person receives or claims a compensation affected payment for the periodic payments period; and
(c)the person was not, at the time of the event that gave rise to the entitlement of the person … to the compensation, receiving a compensation affected payment referred to in paragraph (b);
the rate of the person’s compensation affected payment is to be reduced, in accordance with this section, for the periodic payments period.”
Subsections 1168(4), (5), (6) and (7) have no present relevance.
Section 17(1) of the Act contains definitions relevant to Part 3.14 of the Act. A “compensation affected payment” is defined to include a disability support pension. “Compensation” is said to have the meaning given by subs 17(2). Subsection 17(2) provides:
“For the purposes of this Act, compensation means:
(a)a payment of damages; or
(b)a payment under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or
(c)a payment (with or without admission of liability) in settlement of a claim for damages or a claim under such an insurance scheme; or
(d)any other compensation or damages payment;
(whether the payment is in the form of a lump sum or in the form of a series of periodic payments) that is:
(e) made wholly or partly in respect of lost earnings or lost capacity to earn; and
(f) made either within or outside Australia.”Division 4 of the State Act, which is comprised of ss 35-41, is concerned with payments of compensation by way of income maintenance. Subsection 35(1) of the State Act provides that where a worker suffers a compensable disability that results in incapacity for work, the worker is entitled to weekly payments in respect of that disability in accordance with certain principles set out in the subsection. Subsection 36(1) of the State Act provides that weekly payments to a worker who has suffered a compensable disability can only be discontinued in one of the circumstances identified in the subsection. One circumstance identified in subs 36(1) is that the discontinuance of weekly payments is authorised or required by some other provision of the State Act.
Section 42A of the State Act authorises the discontinuance of weekly payments. Subsections 42A(1), (4), (5) and (6) provide:
“42A(1) Where a worker suffers a compensable disability that results in incapacity for work for a period exceeding two years, [WorkCover] may assess the worker’s loss of future earning capacity as a capital loss.
(4)[WorkCover] may make one or more interim assessments of loss as to nominated portions of the worker’s notional working life before making a final assessment of loss under this section.
(5)An amount assessed under this section becomes due and payable from the date of the assessment but may be paid, at the discretion of [WorkCover], in a single lump sum or in instalments that are actuarially equivalent to the lump sum ….
(6)Subject to subsection (7), where [WorkCover] pays or commences to pay compensation under this section, the worker ceases to be entitled to weekly payments under Division 4.”
Subsection 42A(7) is a notice provision and has no present relevance.
REASONS OF THE PRIMARY JUDGE
Mr Reid contended before the learned primary judge that the use of the present tense in s 1163A(1)(a) of the Act meant that at the time that he had his claim for a disability support pension he did not meet the description of a person who “is entitled to periodic payments under a law of a State.” His Honour said of this contention:
“Whilst pars (a), (b) and (c) of s 1163A(1) are each expressed in the present tense, the subsection is describing events in the past. This must be so as an entitlement to a lump sum only arises when and where an earlier entitlement to periodic payments has been extinguished by conversion into an entitlement to a lump sum. That the paragraphs are referring to events in the past is also clear from pars (e) and (f) which provide that the Part applies as if the person ‘had not received’ the lump sum and the person ‘had received’ periodic compensation payments. Section 1163A(1)(a), (b) and (c) lay down sequential events that have occurred in the past as the criteria for the application of s 1163A. Those events are first that at some earlier point in time the person ‘is entitled to periodic payments …’, and then that the person’s entitlement thereto ‘is converted … into an entitlement to a lump sum’, and the lump sum ‘is calculated by reference to a period’. Each of those criterion was fulfilled when Mr Reid claimed a disability support pension on 30 January 1998.”
His Honour supported his views as to the proper construction of subs 1163A(1) by reference to the illogical consequences that would flow were the construction for which Mr Reid contended adopted, the history of s 1163A, and the Explanatory Memoranda which accompanied the respective Bills that first introduced s 1163A into the Act and subsequently provided for the section to be amended.
As to subs 1163A(2), his Honour found that if it were to be construed literally, an absurd result that would frustrate the object and purpose of s 1163A would follow. His Honour concluded that such a result could not reflect the intention of Parliament. His Honour found that, on its proper construction, subs 1163A(2) is to be understood as a legislative exercise of abundant caution which recognises that, as ss 1163A and 1165 each has its own field of operation, where s 1165 applies, s 1163A does not apply. The unstated converse position, his Honour found, was that where s 1163A applies, s 1165 does not apply.
The conclusion of the primary judge was that as the lump sum payments received by Mr Reid in March 1997 and March 1998 were each lump sum payments calculated by reference to a period, and as the requirements of pars 1163A(1)(a) and (b) were fulfilled, s 1163A governed Mr Reid’s application for a disability support pension and not s 1165.
CONSIDERATION
In our view the conclusion of the primary judge was plainly right.
Mr Reid did not obtain a right to receive payment of a disability pension under the Act at the time that he became incapacitated for work, even if at that time he met the qualifications for a disability support pension (as to which, see s 94 of the Act). Section 106 of the Act provides that a person who wants to be granted a disability support pension “must make a proper claim for that pension”. Section 114 of the Act has the effect that, if a claim for a disability support pension is made in accordance with the Act, the Secretary must determine that the claim is to be granted if the Secretary is satisfied that:
“(a) the person is qualified for a disability support pension; and
(b) the pension is payable” (emphasis added).”The context in which s 114 of the Act is found indicates that the words “is qualified” and “is payable” in s 114 mean “is qualified at the time of the claim” and “is payable at the time of the claim” (see particularly pars 100(2)(b) and 100(3)(b) of the Act). It is thus, in our view, plain that Mr Reid’s entitlement to a disability support pension was to be determined, as his Honour found, in accordance with the Act as in force at the time that Mr Reid applied for the disability support pension.
At the time that Mr Reid applied for a disability support pension, s 1163A of the Act was in the form which is reproduced in [8] above. It had been in that form since 12 December 1995. The section in its original form was not in force at the time that Mr Reid applied under the Act for a disability support pension.
With great respect to Lindgren J who has taken the opposite view, we do not consider that subs 1163A can be construed as though it included the words “on or after 12 December 1995” at the end of par 1163A(1)(b). In our view, where Parliament has intended to limit the operation of a provision of the Act by reference to an event which occurred before a certain date, this has been done explicitly, (see, for example, s 1165 of the Act).
Nor can it be suggested (his Honour does not so suggest) that any retrospectivity is involved in the construction of the Act adopted by von Doussa J. As Jordan CJ said in Coleman v Shell Company of Australia Ltd (1943) 45 SR (NSW) 27 at 31:
“[A]s regards any matter or transaction, if events have occurred prior to the passing of the Act which have brought into existence particular rights or liabilities in respect of that matter or transaction, it would be giving a retrospective operation to the Act to treat it as intended to alter those rights or liabilities, but it would not be giving it a retrospective operation to treat it as governing the future operation of the matter or transaction as regards the creation of further particular rights or liabilities.”
To a similar effect, the Victorian Full Supreme Court in Robertson v City of Nunawading [1973] VR 819 at 824 said of the principle that legislation is presumed not to operate retrospectively:
“[The] principle is not concerned with the case where the enactment under consideration merely takes account of antecedent facts and circumstances as a basis for what it prescribes for the future, and it does no more than that.”
We are unable to fault the primary judge’s careful analysis of the language, history and inter-relationship of the relevant provisions of the Act as in force at the time that Mr Reid applied for the disability support pension. We do not consider that there is anything that we can usefully add to his Honour’s reasons for judgment.
CONCLUSION
In our view, the appeal should be dismissed with costs.
I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Branson and Mansfield. Associate:
Dated: 25 June 2001
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
S 4 OF 2001
ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
KEVIN JAMES REID
APPELLANTAND:
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
RESPONDENT
JUDGES:
BRANSON, LINDGREN AND MANSFIELD JJ
DATE:
29 JUNE 2001
PLACE:
ADELAIDE
REASONS FOR JUDGMENT
LINDGREN J:
I gratefully adopt the account of the background facts, statutory provisions and reasons of the primary Judge given by Branson and Mansfield JJ. As their Honours observe, his Honour carefully analysed the language, history and inter-relationship of the relevant provisions of the Social Security Act 1991 (Cth) (“the SS Act”). Unfortunately, however, I do not agree with the construction adopted by the learned primary Judge ([2000] FCA 1874) and agreed in by Branson and Mansfield JJ. This makes it necessary for me to state my reasons. As the point of difference is a narrow one and my view will not prevail, I will attempt to do so briefly.
Unlike their Honours, in my view subs 1163A(1) of the SS Act operates only prospectively and is not enlivened by a conversion to a lump sum of an entitlement to periodic payments which had preceded the commencement of that provision.
The appellant (“Mr Reid”) sustained a compensable disability (an anxiety disorder) arising out of or in the course of his employment and made a claim for compensation on 6 November 1990 under the Workers Rehabilitation and Compensation Act 1986 (SA) (“the WRC Act”). Weekly payments to him pursuant to s 35 of that Act commenced from 6 November 1990 (they continued until 29 March 1995).
Subsection 42A(1) of the WRC Act provided that where a worker suffered a compensable disability that resulted in incapacity for work for a period exceeding two years, the WorkCover Corporation of South Australia (“WorkCover”) which administered the WRC Act might assess the worker’s loss of future earning capacity as a capital loss. Subsection 42A(2), aided by subs 42A(3), laid down principles to be applied by WorkCover in such a case. Subsections 42A(4)-(6) were as follows:
“(4)The Corporation [WorkCover] may make one or more interim assessments of loss as to nominated portions of the worker’s notional working life before making a final assessment of loss under this section.
(5)An amount assessed under this section becomes due and payable from the date of the assessment but may be paid, at the discretion of the Corporation, in a single lump sum or in instalments¼.
(6)Subject to subsection (7) [not presently relevant], where the Corporation pays or commences to pay compensation under this section, the worker ceases to be entitled to weekly payments¼.”
On 8 February 1995 WorkCover advised Mr Reid that it was considering whether it was appropriate in his case to assess his loss of future earning capacity as a capital loss. On 15 March 1995 it advised him that it had decided to make an assessment of his loss of future earning capacity pursuant to subs 42A(4) of the WRC Act. The letter advised that the interim assessment of the loss of future earning capacity was for a period of 52 weeks from 30 March 1995 to 27 March 1996 and represented a capital loss payment of $18,636.69 calculated pursuant to subs 42A(2) on a basis which was stated in the letter. In their Reasons for Judgment, von Doussa J (at [11]) and Branson and Mansfield JJ (at [4]) have identified four interim payments which were made by WorkCover to Mr Reid, of which the one just mentioned was the first.
When WorkCover paid to Mr Reid the amount of the first interim assessment of loss of earning capacity in March 1995, he ceased to be entitled to weekly payments: subs 42A(6) of the WRC Act, and cf Hill v Workers Rehabilitation and Compensation Corporation (1997) 191 LSJS 300 at [21]-[24]).
In its original form s 1163A had been introduced into the SS Act by the Social Security (Budget and Other Measures) Legislation Amendment Act 1993 (No 121 of 1993) and had commenced on 1 January 1994. That was well before conversion of Mr Reid’s entitlement to periodic payments to a lump sum. In its original form, s 1163A was as follows:
“1163A If:
(a)a person is entitled to periodic payments under a law of a State or Territory; and
(b)the person’s entitlement to the periodic payments is converted under the law of the State or Territory into an entitlement to a lump sum; and
(c)the lump sum is calculated by reference to a period; and
(d)the lump sum is to be paid to the person in 2 or more instalments;
this Part applies to the person as if:
(e)the person had not received the instalments; and
(f)the person had received in each fortnight during the period a periodic compensation payment equal to:
lump sum amount
number of fortnights in the period
where:
“lump sum amount” is the amount of the lump sum referred to in paragraph (b);
“number of fortnights in the period” is the number of whole fortnights in the period referred to in paragraph (c).”The Explanatory Memorandum which accompanied the Bill for the Act which introduced the section explained the purpose of this section: see par [28] of the Reasons for Judgment of von Doussa J.
Section 1163A in its original form did not catch the lump sum paid to Mr Reid on or about 15 March 1995 because it was not a lump sum which was to be paid to him in two or more instalments, as stipulated in par (d) of that section and permitted by subs 42A(5) of the WRC Act noted earlier. Rather, it was payable in a single lump sum as also permitted by the latter provision. It was seen to be a “loophole” that a lump sum payment calculated by reference to a period but to be paid by a single payment should escape the section. Accordingly, the SS Act was amended as from 12 December 1995 to close the loophole. The amendment was effected by the Social Security Legislation Amendment (Carer Pension and Other Measures) Act 1995 (No 143 of 1995) and the amendment commenced on 12 December 1995. The Explanatory Memorandum which accompanied the Bill for the amending Act (see pars [35] and [36] of von Doussa J’s Reasons for Judgment) makes clear that closure of the loophole mentioned was its purpose, but is quite consistent with that closure being only prospective in its operation.
The amendments were effected by s 3 of, and Items 1, 2, 3 and 4 of Schedule 15 to, the amending Act. Paragraph (d) which had required that the lump sum be paid in two or more instalments was omitted (it was not replaced) and, consequentially, so was par (e) and the following new par (e) was substituted:
“(e)the person had not received:
(i)the lump sum; or
(ii)if the lump sum is to be paid in instalments – any of the instalments; and”.
As well, the following new subsection (2) was added:
“(2)This section does not apply in respect of a lump sum to which a person is entitled if section 1165 applies in respect of the lump sum.”
The new s 1163A which commenced on 12 December 1995 is set out in their Reasons for Judgment by von Doussa J (at [16]) and by Branson and Mansfield JJ (at [8]). That provision was in force when, on 30 January 1998, Mr Reid applied under the SS Act for a disability support pension. Under subs 17(1) of the SS Act, that application was a claim for a “compensation affected payment” and the four interim payments made to Mr Reid referred to earlier were payments of “compensation” to him for the purpose of s 1165 of the SS Act. The response which was made to Mr Reid’s application on 30 January 1998 is noted by von Doussa J and Branson and Mansfield JJ in pars [2] and [6] of their respective Reasons for Judgment.
In my opinion, the amended subs 1163A(1) was intended to have a prospective and continuous operation after 12 December 1995. If necessary, the presumption against retrospectivity applies. That presumption is well established. As Dixon CJ said in Maxwell v Murphy (1957) 96 CLR 261 at 267:
“The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events.”
Similarly, in Fisher v Hebburn Ltd (1960) 105 CLR 188, Fullagar J said (at 194):
“There can be no doubt that the general rule is that an amending enactment – or, for that matter, any enactment – is prima facie to be construed as having a prospective operation only. That is to say, it is prima facie to be construed as not attaching new legal consequences to facts or events which occurred before its commencement.”
But it does not seem necessary to rely on any presumption, because in my opinion there is simply no reason to deny the word “is” in each of pars (a), (b) and (c) of subs 1163A(1) its ordinary meaning of referring to a state of affairs which prevails contemporaneously with the operation of the subsection, that is, after 12 December 1995. Accordingly, the subsection provides that if at any time after that date a person is entitled to periodic payments under a law of a State or Territory and that entitlement is then converted under that law into an entitlement to a lump sum which is calculated by reference to a period, Part 3.14 of the SS Act applies to the person, if and when occasion to apply it to him or her arises, as if the person had not received the lump sum, or any of the instalments by which the lump sum was payable, and had instead received in each fortnight during the period, a periodic compensation payment calculated in the manner set out in the subsection.
In my respectful opinion, this construction does not render subs 1163A(1), and, in particular the amendment effected in December 1995 ineffective. Prior to that amendment, a person, who, like Mr Reid, received his lump sum by a single payment rather than by instalments, was not caught. According to my construction, if his circumstances (entitlement to periodic payments followed by its conversion into a capital sum) existed after 12 December 1995, the amendment would do its work. But in Mr Reid’s case those circumstances did not exist after that date – they preceded that date, the entitlement to periodic payments having ceased when the conversion took place in March 1995. The amendment mended the net for the future but did not catch a fish which had already escaped.
The following further considerations favour my construction:
· The language “is entitled” of subs 1163A(1) may be compared or contrasted with that found in neighbouring provisions such as subss 1163(1) and (2) (“is or may be entitled”), subs 1164(2) (“receives or claims” and “is entitled or may, in the Secretary’s opinion, be entitled”) and subss 1165(1), (1A), (2), (2AA) and (2B) (“receives or claims”). These provisions and their counterparts in earlier forms of the provisions, suggest that the legislature chose “is entitled” in s 1163A deliberately, intending it to refer to an actual entitlement in existence at any time after the provision had commenced to operate.
· The suggested retrospectiveness of the operation of subs 1163A(1) has no time limit and would capture conversions of periodic entitlements into capital sums, no matter how far back in the past they occurred – a result unlikely to have been intended. Indeed, if “is entitled” in par (a) means “is or was entitled” and “is converted” in par (b) means “is or was converted” and “is calculated” in par (c) means “is or was calculated”, those expressions would have borne those respective meanings (and “is to be paid” in the former par (d) would have meant “is or was to be paid”) when s 1163A was enacted in its original form with effect from 1 January 1994. That is, it would be wrong to think that the retrospectivity in question went back no further than to that date.
In my view, the construction which has found favour with the primary Judge and with Branson and Mansfield JJ is strained and seems to arise from a conception of the provision as one which commences to operate at the time of the relevant application (30 January 1998 in Mr Reid’s case). But I think the provision has a continuous operation after its commencement in December 1995 and catches all of the sequences of “entitlement to periodic payments and conversion of that entitlement into an entitlement to a lump sum”, occurring after that commencement.
Like Branson and Mansfield JJ, I agree with the learned primary Judge that as at January 1998 the terms of s 1165 were applicable to the circumstances of Mr Reid’s case. Since, unlike their Honours, for the reasons given above, I do not think subs 1163A(1) was then applicable to those circumstances, I am not required to reach a conclusion as to the construction and operation of subs 1163A(2). Prima facie, one would expect that subsection to operate where both subs 1163A(1) and s 1165 apply in respect of a lump sum to which a person is (at any time after 12 December 1995) entitled, to make the former yield to the latter.
For the above reasons, I would allow the appeal with costs, set aside the orders of the primary Judge and substitute for those orders an order affirming the decision of the Administrative Appeals Tribunal given on 5 July 2000 in proceeding S1998/295 in that Tribunal and an order that the present respondent pay the present appellant’s costs of the proceeding before his Honour.
I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren. Associate:
Dated: 25 June 2001
The Appellant appeared in person. Counsel for the Respondent: Mr T McRae Solicitors for the Respondent: Australian Government Solicitor Date of Hearing: 28 May 2001 Date of Judgment: 29 June 2001
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