Repatriation Commission v Malady

[2006] FMCA 1050

FEDERAL MAGISTRATES COURT OF AUSTRALIA

REPATRIATION COMMISSION v MALADY [2006] FMCA 1050

ADMINISTRATIVE LAW – Appeal from AAT – claims under Veteran Entitlements Act 1986 – eight days service in East Timor – failure to ask and answer the right questions – proper construction of ss.120(1), 120(3) and 120A(1) of the Veterans Entitlements Act – failure to have consideration of the whole of the material before the Tribunal – reasonable hypotheses – identification of hypothesis connecting claim to service – statements of principle – hypothesis to fit template of statement of principle – standard of proof.

Veteran Entitlements Act 1986, ss.9, 119, 120(1), 120(2), 120(3), 120A, 120A(3)

Repatriation Commission v Owens (1996) 70 ALJR 904
Repatriation Commission v Deledio (1998) 83 FCR 82
Byrnesv Repatriation Commission (1993) 177 CLR 564
Repatriation Commission v Hill (2002) 69 ALD 581
Repatriation Commission v Stoddart [2003] FCAFC 300
Repatriation Commission v White [2004] FCA 633
Repatriation Commission v Gosewinckel (1999) 59 ALD 690
Lees v Repatriation Commission [2002] FCAFC 398
Blair v Repatriation Commission [2005] FCA 1076
Repatriation Commission v Mines [2004] FCA 1331
Repatriation Commission v Milenz [2006] FCA 1436
Knight v Repatriation Commission (2002) FCA 103

Applicant: REPATRIATION COMMISSION

Respondent: MICHAEL PATRICK MALADY

File Number: MLG 1436 of 2005

Judgment of: O’Dwyer FM

Hearing date: 21 July 2006

Delivered at: Melbourne

Delivered on: 8 December 2006

REPRESENTATION

Counsel for the Applicant: Ms Macdonnell

Solicitors for the Applicant: Australian Government Solicitor

Counsel for the Respondent: Mr De Marchi

Solicitors for the Respondent: De Marchi & Associates

ORDERS

1. The application by way of appeal be allowed.

2. The decision of the Administrative Appeals Tribunal given on 28 July 2005 be set aside.

3. The matter be remitted to a differently constituted Tribunal for further hearing and determination according to law.

4. The respondent pay the applicant’s costs of the appeal.

5. General liberty to apply.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLG1436 of 2005

REPATRIATION COMMISSION

Applicant

And

MICHAEL PATRICK MALADY

Respondent

REASONS FOR JUDGMENT

Introduction

1. Mr Malady, when a member of the second Royal Australian Regiment (2RAR), served in East Timor during the period  20 September 1999 to 28 September 1999.  He claims as a consequence of that operational service he suffers from major depression, as well as alcohol and drug abuse and states that this entitles him to a pension under the Veterans’ Entitlements Act 1986 (the Act).  His application for such a pension to the Applicant (the Commission) was refused.  Ultimately, after an unsuccessful review of that decision to the Veteran’s Review Board, a review to the Administrative Appeals Tribunal (the Tribunal) proved successful.  This proceeding now comes before me as an appeal by the Commission from the Tribunal’s decision.

2. The Commission has raised 9 questions of law and set out 9 grounds of appeal.  In short summary, the questions of law raised relate:

   a)to the proper construction of  ss.120(1), (3) and (4) and s.120A(3) of the Act;

   b)the proper construction and operation of various clauses of relevant Statements of Principle (SoP);

   c)whether the Tribunal erred in failing to make findings as to the clinical onset of the condition claimed, and indeed, which of four distinct conditions (alcohol dependence or abuse, drug dependence or abuse) was the condition Mr Malady suffered;

   d)whether the Tribunal failed to consider the whole of the material as required by s.120A(3) of the Act; and

   e)whether the whole of the material raised a hypothesis that connected the relevant condition with his service and was upheld by a SoP.

   The final two legal questions raised relate to whether, because of the Tribunal’s alleged failure to identify the hypotheses said to connect
   Mr Malady’s claimed conditions to the circumstances of his operational service, the Tribunal failed to ask and answer the questions posed by s.120A(3) of the Act.

   
   

3. The 9 grounds of appeal are set out in detail below, but reflect, in broad terms, the points of law summarised above.

Legislative framework and law

1. Under the Act the Commonwealth is liable to pay a pension to a veteran where that veteran has suffered incapacity through a war–caused injury or disease.  For the purpose of this decision, there is no issue that the time spent by Mr Malady in East Timor fits legislative definitions of military service that would qualify him for a pension, should he have suffered a qualifying injury or disease.  His service is described as operational service (see s.9(1)(b) of the Act).  The issue in this case is whether Mr Malady did suffer such an injury as defined by the legislation.

2. The standard of proof to be applied in respect of Mr Malady’s claimed conditions is that the Commission is required to be reasonably satisfied (see s.120(4) of the Act).  However, s.120(3) of the Act has application to claims that fall under the purview of s.120(1), as Mr Malady’s claim does.  That section raises a threshold question, namely whether there is a reasonable hypothesis raised “after consideration of the whole of the material before [the decision-maker]” that connects the injury with the circumstances of the particular service rendered by Mr Malady. (emphasis added)  The High Court in Repatriation Commission v Owens (1996) 70 ALJR 904 emphasised that the question of what is a reasonable hypothesis is to be determined on a consideration of the whole of the material.

3. The question of the reasonableness of the hypothesis is affected by the operation of s.120A of the Act as Mr Malady’s claim post dates 1 June 1994 in respect of operational service.  Section 120A(3) of the Act states that a hypothesis is only reasonable if it fits a SoP that is in force and which upholds the hypothesis. 

4. A SoP is produced by The Repatriation Medical Authority and sets out, based on sound medical–scientific evidence, the factors that must be a minium to exist and which of those factors must be related to the service rendered by the claimant, to determine whether there is a reasonable hypothesis raised to connect the injury or disease complained of to the circumstances of the claimant’s service.

5. How this legislative framework was to be put into effect was considered in Repatriation Commission v Deledio (1998) 83 FCR 82 at 97–98. It is a four stage process to determine whether a hypothesis is reasonable. The first requires the decision maker to consider all of the material before it and determine whether that material points to a hypothesis connecting the injury to the particular service of the claimant. If no such hypothesis arises then the claim must fail.

   
   

   This stage does not necessitate any fact finding.  The second stage is, once a hypothesis is raised, whether there is in force a SoP.  If there is no SoP in force then the hypothesis will be taken not to be reasonable and will fail.  The third, and as I understand the Commission’s case, the most important in the context of this appeal, is to determine whether the hypothesis fits the “template” of the SoP.  The hypothesis must contain one or more of the factors (as spelt out in the SoP) which have been determined must exist and which must be related to the claimant’s service.  If the hypothesis does contain these factors, it could not be said to be contrary to proved or known scientific facts, or be otherwise considered fanciful.  If the hypothesis fails to fit within the template, it will be deemed not to be “reasonable” and the claim must fail. 

   
   

   The final stage is to determine whether, beyond reasonable doubt, the claimed injury did not arise from eligible service.  This in fact, at this stage, is a reverse criminal standard of proof.  If it is not so satisfied the claim must succeed.  If it is so satisfied, the claim must fail.  It is only at this stage that there is a requirement for fact finding. 

6. The interrelationship of ss.120(3) and 120(1) of the Act was considered by the High Court in Byrnes v Repatriation Commission (1993) 177 CLR 564 at 571:

   “The position may be summarized as follows: (1) First, sub-s. (3) of s. 120 is applied: do all or some of the facts raised by the material before the Commission give rise to a reasonable hypothesis connecting the veteran’s injury with war service? 
   The hypothesis will not be reasonable if it is contrary to known scientific facts or is obviously fanciful or untenable.  If the hypothesis is not reasonable, the claim fails.  Proof of facts is not an issue at this point.  (2) If a reasonable hypothesis is established, sub-s. (1) of s. 120 is applied.  The claim will succeed unless: (a) one or more of the facts necessary to support the hypothesis are disproved beyond reasonable doubt; or (b) the truth of another fact in the material, which is inconsistent with the hypothesis, is proved beyond reasonable doubt, thus disproving, beyond reasonable doubt, the hypothesis.”

   
   

7. In my view, the inescapable consequence of ss.120(1), 120(3) and 120A(3) of the Act is that no claim that an injury or disease is related to operational service can succeed, where there is in force a SoP concerning that kind of injury or disease, unless the whole of the material before the decision-maker raises an hypothesis that fits the template of an applicable SoP in the manner described by the Full Court in Repatriation Commission v Hill (2002) 69 ALD 581 at [57]. Hill highlighted that a claim must be supported by material pointing to each element that the SoP makes essential for the hypothesis to be reasonable.

8. At the time of the Commission’s decision, relevantly there were 5 SoPs in force; namely:

   11.1No 143 of 1995 concerning personality disorder, as amended by No 13 of 1997;

   11.2No 3 of 1999 concerning post traumatic stress disorder, as amended by No 54 of 1999;

   11.3No 58 of 1999 concerning depressive disorder;

   11.4No 76 of 1998 concerning alcohol dependence or abuse; and

   11.5No 78 of 1998 concerning drug dependence or abuse.

Mr Malady’s background and service record

1. After a period in the Army Reserve and at the age of 25 years

   
   

   Mr Malady transferred to the Regular Army and was posted to 2RAR as a rifleman at Townsville.

2. Mr Malady was posted on special service to East Timor where he remained for a period of 8 days, from 20 to 28 September 1999, before being medically evacuated after contracting Shigella dysentery. 

   
   

   He never rejoined his company in East Timor.

3. There were significant events after his return concerning his medical condition.  On 10 May his medical classification was downgraded to 3R and he was restricted to light duties.  On 1 June 2000, Mr Malady presented to sick bay with emotional problems.  The next day he

   
   

   self–referred to an Army psychologist expressing concerns that his lower leg condition (ankle) may lead to a medical downgrade and potential discharge from the Army.

Procedural history

1. Significantly, on 14 July 2000, Mr Malady’s medical classification was downgraded to 4 on the basis of his ankle problem and post traumatic stress disorder (PTSD).  He was found to be “unfit for service”, resulting in his discharge from the Army on 10 September 2000.

2. However, before his formal discharge, on 9 August 2000 Mr Malady made a claim in respect of major depression arising from his service in East Timor.

3. Mr Malady’s claim was treated by the Commission as a claim for major depression, alcohol and drug abuse and refused it on 21 February 2001.

4. On 27 February 2001 a review of that decision was considered by the Veteran’s Review Board.  The Board affirmed the earlier decision.

5. However, Mr Malady’s subsequent review to the Tribunal was successful.

Mr Malady’s experiences in East Timor

1. In the evidence presented to the Tribunal, Mr Malady recites a number of instances and experiences that he said caused him distress. 

   
   

   They were:

   20.1Soon after disembarking at Dili, there was an unauthorised discharge of a weapon by a fellow soldier at a time Indonesian soldiers were nearby and he felt vulnerable;

   20.2Whilst on patrol, in an abandoned house, he smelt blood although he could not see it, and the floor was sticky;

   20.3Indonesian soldiers passing in a truck did not lower their weapons and had an aggressive stance;

   20.4He saw dried blood on the roadway at a road block;

   20.5

   A man came towards him, about 200 metres away, with what looked like a weapon before retreating out of his patrol’s path.  He had released the safety catch on his rifle ready to shoot. 

   
   

   He was shaken and ill from this experience because of the realisation that the person’s life was in his hands;

   20.6Because of the cumulative effect of these incidents, he did not feel like sleeping and they were playing on his mind; and

   20.7He also had a general feeling of vulnerability.

The material before the Tribunal

1. Mr Malady, Dr Cole and Dr Strauss gave evidence at the Tribunal.

2. The material set out under this heading is largely taken from the Commission’s submissions and were unchallenged by Mr Malady’s representative.  I have set them out as a relevant and convenient summary.

The evidence of Mr Malady

1. In addition to the evidence of Mr Malady set out above, he produced a contemporaneous diary of his East Timor experience.  There were notable entries (or rather lack of entries) in the diary that were not taken into account in the Tribunal’s decision. The short notes record the unauthorised discharge of a weapon, the pool of dried blood at a checkpoint and seeing a shallow grave nearby, but otherwise the entries are unexceptional in light of what Mr Malady later claimed as stressors.

2. Mr Malady also confirmed to the Tribunal that he had a sense of failure and desolation at being withdrawn from East Timor and felt as if he had let down his fellow soldiers in his section.

The evidence of Dr Cole

1. Dr Edward Cole (consultant psychiatrist) diagnosed PTSD and reported that “the stumbling point appears to be whether or not he was exposed to a ‘severe stressor’ as defined in the SoP for PTSD…but more prolonged and less dramatic events can produce much the same effect.  The important thing was that the person perceived himself to be in danger of death or serious injury and that this perception was reasonably based, given the circumstances, even though it later emerged that no such threat existed….and Mr Malady’s symptoms clearly indicate that he genuinely believed himself to be in danger while he was in Dili…”  (emphasis added)

2. In his oral evidence, the doctor agreed that Mr Malady was not suffering from PTSD by reason of exposure to a stressor in East Timor and he did not fit the template of the SoP for PTSD (see [43] of the Tribunal’s Reasons).

3. Dr Cole also acknowledged that he had limited information regarding Mr Malady’s behaviour and pre-enlistment consumption of alcohol and drugs and convictions (see [42] of the Tribunal’s Reasons).

The evidence of Dr Strauss

1. In what the Tribunal described as a “comprehensive” report, Dr Nigel Strauss (consultant psychiatrist) diagnosed Mr Malady as suffering from major depression, a substance abuse disorder and a personality disorder.  It is significant to note, in my view, that the Tribunal summarised only Dr Strauss’ oral evidence in its Reasons.  The oral evidence of Dr Strauss was that Mr Malady’s substance abuse was secondary to his personality disorder and his depression developed from his profound sense of failure. 

2. Dr Strauss took a history of Mr Malady’s parents having divorced; of him being brought up by his mother (whom he described as a “hypochondriac”); never being close to his father (whom Mr Malady described as a “drinker” and “an alcoholic” in his evidence); being bullied by an elder brother (who drinks heavily “now and again”); getting into trouble for underage drinking; being involved in assaults and wilful damage and appearing before the courts; being asked to leave a school because he was disruptive and had been “in a bit of trouble”; not always being engaged in full–time employment; being involved in further assaults in recent years; currently awaiting serious court charges; being in significant conflict with his ex-wife including an Intervention Order having been taken out against him.  He also took an account of the Mr Malady’s maternal uncle having had some “nervous breakdowns”.

3. Dr Strauss reported that Mr Malady felt ashamed about not being able to go back to Timor and that he had said there was a mess up and that was why he did not go back.

4. Dr Strauss was of the view that Mr Malady was left with a significant sense of guilt, failure and remorse when he left East Timor which threw him into a significant depression.  He was also of the view that

   
   

   Mr Malady tended to not take responsibility for his circumstances and tended to blame others for what has happened to him, and used his compensation claim or process as a way of justifying the problems he had encountered over the years since his time in the Army.

5. Dr Strauss’ report referred to many entries in the file of the Austin and Repatriation Hospital file including: 

   32.1an entry dated 10 December 2003 in which Mr Malady described how he first began using alcohol as a youngster to escape from a very unhappy home life and having been expelled from two schools;

   32.2an entry dated 21 July 2003 regarding his early years being marked by physical abuse from siblings; and

   32.3an entry dated 10 September 2003 that he started binge drinking from the age of 13 or 14 and his parents could not do anything to stop his drinking getting out of control and he continued his basic pattern usually drinking Friday and Saturday nights and alcohol binges bring out a nasty, violent side and he becomes intolerant.  He used alcohol to forget about what was happening at home, and bullying by older brother and his parents separating meant that he felt different from other people and he was insulted and bullied at school.  He experimented with cannabis initially at the age of 14 and smoked whenever he could.

6. In the “final summary” in his report, Dr Strauss said that:

   “I believe that this man has long standing psychological problems which predate his time in the Army.  He has significant problems with attachment and I believe that after he got back from Timor he felt a sense of failure and desolation and he felt as if he had let the Army down.  This impacted on his self esteem and he is a vulnerable man who did not cope well.  In my opinion to explain the psychological consequences of his time in the Army he has used the idea of a post traumatic stress disorder to justify his behaviour in recent years. However in my opinion his psychological problems were aggravated by the fact that he could not continue his time in Timor rather than by his exposure to stressors while in that country. If this man could have continued his time in Timor or could have returned to Timor his psychological decompensation possibly would not have been so significant.  It was the fact that this man felt that his association with the Army had somehow changed after his time in Timor that brought about a worsening in his underlying psychological difficulties.  He began to reabuse substances and his marital situation deteriorated.  His behaviour was subsequently impacted upon and he has continued to suffer form significant psychiatric problems since then.

   Therefore it was this man’s perception of circumstances that brought about his psychological decline in my opinion rather than actual events that occurred in his life.  He felt as if he had somehow failed and this brought about a chain of events that have had a significant and detrimental effect upon this psychological functioning.” (emphasis added)

7. Dr Strauss adopted his opinions above in his oral evidence and the Tribunal did refer to that adoption in its summary of the evidence given to it (see [54] of Tribunal’s Reasons).

Mr Malady’s psychological assessment prior to service

1. On 19 October 1997, Mr Malady was assessed by a psychologist for the purposes of service classification.  The Tribunal makes no reference to this psychological assessment in its Reasons.  This is important background, in my view, by way a creating an understanding of

   
   

   Mr Malady and his problems, and forms part of the whole of the evidence to be considered by the Tribunal.

2. The psychologist recorded that Mr Malady’s parents used to fight and were separated.  His father was 52 years old and retired.  Mr Malady left school without completing year 10.  He had been employed as a farmhand and casual labourer from 1991–1994 and a part–time driveway attendant from 1994–1997, and had commenced a pre–apprentice course for carpentry/joinery on 15 December 1997.

3. The psychologist recorded that Mr Malady had been convicted of wilful damage in 1987; lost his licence in 1989; and been convicted in 1994 of driving without a licence and dangerous driving.  He also recorded that Mr Malady smoked 12–20 cigarettes a day, drank alcohol on special occasions and used unspecified drugs at 16–17 years.

4. Mr Malady’s motivation to join was recorded as the “need to belong to something, want family to be proud enjoy challenges; eventually join Regs etc.”  He also noted that Mr Malady had his “head down initially avoided eye-contact”, was of “low average results on testing” and that he “may have some difficulties with training assimilation”.

   
   

   The classification recommended was A2.  In other words, there were doubts about him from the outset, although those doubts were not obviously sufficient to disqualify him from service.  This background information constitutes another integral part of the whole of the evidence the Tribunal should consider, the significance of which is dependant on other evidence that constitutes the whole of the evidence before the Tribunal.

Offences committed prior to service

1. Mr Malady’s police check on enlistment revealed that he had been convicted of unlawful assault and assault with a weapon on 13 April 1995.

2. He had also been convicted of assaulting police, resisting arrest, being drunk in a public place, using threatening words and behaving in an offensive manner on 1 May 1995.

3. Mr Malady admitted the convictions in cross-examination.

   
   

   The Tribunal did not make any reference to these convictions in its Reasons.  It refers only to a conviction for driving without a licence in 1995 and to Mr Malady’s explanation of the conviction for assault with a weapon (see [35] of its Reasons).

4. Again, this is evidence that constitutes an important part of the whole of the evidence for consideration by the Tribunal.  The significance of it is, once again, dependant on other evidence before the Tribunal.

Report on recruit training

1. At the conclusion of his recruit training on 20 February 1998,

   
   

   Mr Malady was reported to have “an indifferent attitude to training” and “his concentration was found to be lacking” a number of times. Again, the Tribunal does not refer to this in its Reasons.

Clinical Notes of psychologists

1. Although the Tribunal stated that it was referring to the notes of

   
   

   Dr Ridley (who assessed Mr Malady after his return to Warrnambool and of Mr Kingsley, psychologist who attempted to treat him for substance abuse) “to glean as much information concerning
   [Mr Malady’s] circumstances and his subsequent treatment to assist in the decision-making process of making findings with respect to diagnosis and the connection between service and any diagnosed illness, injury or disease”, it failed to take into account the following clinical notes and opinions of psychologists during his service.

2. The first record of Mr Malady presenting with any emotional problems is dated 1 June 2000 when Mr Malady was referred by a 2RAR medical officer to psychologist, Robert Zamatis who said that

   
   

   Mr Malady was:

   “a very keen infantryman and extremely frustrated by his current state and medical problems which don’t allow him to participate with his company.  Currently working in Sgt’s Mess.  Wife is depressed currently.  Also trying to deal with the fact that he was medically sent home from Timor for dysentery→feels as if he has failed in his duties”. 

3. On 2 June 2000, Mr Malady self referred to Army psychologist,

   
   

   Lt Rees, whose clinical notes state that:

   46.1Mr Malady described symptoms which had “existed primarily during Timor & have escalated over the last few months”.

   46.2Mr Malady was “suffering a condition in his lower legs which may lead to a medical downgrade and potential discharge from infantry.  This naturally concerns him and  he’s worried about his future career in the Army is seeking a compassionate posting back to Victoria where his family and his wife’s family are located.  This request has been sent to Schemo”.  (emphasis added)

   46.3The RMO of 2RAR (Dr Damien Wood) told her that Mr Malady was medically classified as “class 3R & a downgrade is based on how his condition progresses.  At this stage, the condition is serious (ie there continues to be inflammation of his calf muscles attached to the bone).  At the moment, he’s on light duties in the Sergeant’s Mess”.

   46.4Mr Malady said that he “did not fit in with his section and     therefore did not feel comfortable talking to them.  Due to his recent position in ARA [Army Reserve] he felt like an outsider,   so isolation was a problem for him”. 

4. Lt Rees continued to treat Mr Malady and her clinical notes for 5, 6, 7, 8, 9, 13 and 14 June 2000 were exhibited before the Tribunal. 

   
   

   On 5 June 2000, Lt Rees recorded that he did “not appear to have symptoms associated with PTSD in that he does not suffer flashbacks or feel as though he is reliving his experiences in Timor”.  (emphasis added)  On 6 June 2000, Lt Rees “ruled out DSM classified Post Traumatic Stress Disorder”.  (emphasis added)  On 13 June 2000,

   
   

   Lt Rees recorded that Mr Malady’s “questions were directed at discharge and options surrounding this”. 

Clinical records of the Lavarack Barracks Medical Centre

1. At the first consultation on 2 June 2000, Lt Rees had referred

   
   

   Mr Malady to Dr McDonald at the Lavarack Barracks Medical Centre (LBMC).  Dr McDonald recorded:

   “a general worsening of anxiety, anger, depressed since return from E. Timor – constant fear of death TNI weapons on him yet he couldn’t point at them – Shigella enteritis → after 4/52 → rear details 10-11/99 – Feels would have liked to get back.  Since return - shin splints – ankle laxity.  Anxiety – being killed or having to kill.  Anger – coming back early – not tolerating fools well – feels they are baiting him – “everything” – “able to explode”.Depression – lack of control of feelings, physical limitations.  Poor sleep – Temazepan 1 tablet tried – thoughts he’ll die if goes to sleep.  No alcohol abuse.  Eating – intermittent ↑ weight as less PT.  Easily angered- yells at wife & both kids – no physical violence – considers car accident into tree – last resort.

   D Combat stress Depressed anxiety Try Mogodon 1-2 night Zoloft 50 mg C/L to 6.6.00 Needs Dr Green Sees 3 BASB psychologist 6.6.00.”  (emphasis added).

2. Dr McDonald referred Mr Malady to Dr Green (psychiatrist) stating that Mr Malady had spent 4 weeks in East Timor, which is not a correct history.  On 5 June 2000, Dr Green took a history of TNI pointing rifles at them all the time (again not a correct history) and of “symptoms of Major Depressive Disorder with obsessions”.  On 22 June 2000, he recorded “symptoms of MDD which probably developed from PTSD due to Timor” (although there is other medical evidence to suggest he is not suffering from PTSD, or should he be, that it is not related to his East Timor service).  On 12 July 2000, Dr Green recorded “there is depressed mood, anger, anxiety, lack of energy, sleep disturbance and marked patterns of avoidance behaviour.  Also occasional thoughts that life isn’t worth living”.  The doctor also recorded that Mr Malady was “unfit for military service and should be discharged in due course”. 

   
   

   On 24 July 2000, Dr Green recorded that “symptoms of PTSD continue with marked avoidance behaviour”.  (emphasis added)

3. On 7 June 2000, Dr Simpson of LBMC referred Mr Malady to a sports physician stating that he “had several medical problems since transfer to the Regular Army” and had “an 18 month history of bilateral shin splints and lateral ankle pain following repeated inversion injury.  There [had] been no improvement with formal orthotics, he is NSAID intolerant and worsens with physio modalities”.  (emphasis added)

4. Significantly, in my view, the Tribunal failed to take into account this evidence of unimproving leg conditions at the time of Mr Malady’s presentation with emotional problems.  It also failed to take into account the variance between Mr Malady’s accounts to the doctors of a month’s service in East Timor and his actual presence there for only eight days, of which a significant amount of that time was spent in the field hospital, and not on patrols or other duties. 

Medical board classifications

1. On 14 July 2000, Mr Malady was found by a medical board to be “unfit for military service” on the basis of “bilateral tibial periostitis; repair L peroneal tendons (ankle); PTSD”.  (emphasis added)  The examination record confirms that he was classified class 3R on 10 May 2000.

2. On 22 August 2000, a final medical board examination was conducted at which “Major Depressive Disorder” and “Bilateral tibial periostitis with [illegible] peroneal tendons in ankle” were diagnosed.  The record also stated that “all these events seem to have followed his deployment overseas” and that “his behaviour problems appear to pre–date the lower limb abnormalities”.  The major depressive illness was thought to be secondary to PTSD.

Post service medical reports and records before the Tribunal

1. Dr Green completed the medical diagnosis part of the pension claim form as “PTSD followed by Major Depressive Disorder” on the evidence of a “typical history and mental state exam” and nominated “10/99” as the date of onset.

Dr Ridley

1. Mr Malady moved from Townsville back to Koroit in Victoria where he was referred by his treating GP to Dr Graham Ridley, consultant psychiatrist, for treatment.  The Commission obtained a medical report from Dr Ridley dated 1 December 2000.  Dr Ridley reported he has “been unable to access any other documentation regarding

   
   

   [Mr Malady’s] psychiatric history or current mental health, reasons for discharge from the army etcetera”.  The doctor also stated that

   
   

   Mr Malady’s wife presented most of the information to him, and that:

   “His description of his service in East Timor was extremely sketchy

   but he did tell me that he personally had not seen any active service although he felt constantly afraid and alert to the presence of imminent danger more or less from the time he arrived there.  He was discharged from East Timor back to Townsville after a period of only one month there apparently because he was suffering from infection with Shigella.  
   [Mr Malady] told me that after he arrived back in Townsville he became persistently anxious and worried and began to isolate himself increasingly from others … (emphasis added)

   
   

   [He] told me that both his father and a paternal uncle had experienced difficulties during their lives with excessive and inappropriate use of alcohol.  He however denied any other formal family history of psychiatric disorder. He told me that he had grown up in Koroit and had left school at the age of sixteen obtaining employment at the local abattoir where he remained until he joined the army two years prior to our original interview …

   On the basis of the historical information presented to me by
   [Mr Malady] and his wife, it would also appear that this major depression is complicated by elements of Post Traumatic Stress Disorder, as typified by persistent nightmares and a tendency to become increasingly socially isolated and avoidant.  It is possible that [Mr Malady’s] persistent use of cannabis and alcohol is an attempt by him to reduce the hyper-arousal which is otherwise a common symptom of this disorder but I have not detected any clinical evidence of this myself.

   
   

   …

   Regarding the relationship between [Mr Malady’s] current level of disability and his army service it seems from the history available to me that [Mr Malady] had had no previous problem with his psychological health until he joined the army and was in active service in East Timor.  [Mr Malady] told me that his problems with heavy use of alcohol and cannabis appeared only after he had returned to Townsville from East Timor and he denied any such difficulties before his posting.  This absence of any past history was confirmed to me by his wife on two separate occasions.  In view of this it seems reasonable to conclude that [Mr Malady’s] service in East Timor had a direct etiological role in precipitating his current psychological difficulties.  It does also however seem to me extremely likely that [Mr Malady] was predisposed to the development of such conditions by what appears to me to be a naturally fairly isolative and potentially hostile personality”.  (emphasis added)

2. On 6 August 2001, Dr Ridley prepared a report for Mr Malady’s advocate in which he diagnosed PTSD on the basis of:

   “Mr Malady’s “constant sense of fear, dread and alertness to the presence of imminent danger more or less from the time of his arrival there… even though it may not strictly meet the operationalised criteria set up strictly for research purposes in the Diagnostic and Statistical Manual of mental disorders…
   It seems to me most important in making a diagnosis to take into account all relevant factors rather than one or two fairly specific ones.  In this context the timing and sequencing of
   [Mr Malady’s] subsequent development of symptoms seems to me to be particularly relevant . . . It seems fairly clear from the history that [his] sense of helplessness and fear in the light of his vicarious exposure to threats in East Timor was followed on his discharge from the army by a gradually escalating sense of helplessness together with re-experiencing of traumatic memories and increase in social avoidance and increased in attempt to reduce his psychological arousal by using increasing and excessive amounts of alcohol and cannabis.”(emphasis added)

Dr Green

1. In a letter to the RSL advocate dated 8 August 2001, Dr Green quotes from his clinical notes what Mr Malady told him regarding stressors:

   “Frightened I suppose…We did not know what to expect when we got off the planes…He said he was “constantly on guard….waiting for something to happen…I was just anxious nervous scared”…Trucks full of TNI going past with rifles pointed at you…(He felt) out of control not being able to do anything about it….waiting for some thing to happen…threatened by TNI pointing weapons… smiling…”  He said he had one lined up…not knowing whether to shoot or not, waiting to be told. 
   Mr Malady said that it was an “Indonesian with a weapon…probably militia…I did not know…I was watching the weapon….I don’t know if he had seen us…”  Mr Malady said that the decision was “not to fire” because the target was “too far away”.  He said he had no confidence in the Section Commander and he did not want to kill anybody.”

   
   

2. Dr Green also stated that:

   “It is a matter of opinion as to the degree of the stressor.  In my opinion [Mr Malady] perceived Timor as being threatening but it is doubtful that his situation and experience satisfies the requirements in the ‘statement of principles’, but I believe Timor to be the principal cause of his psychiatric disorder. 
   PS.  He did not convey the impression that his episode of Shigella dysentery was a significant stressor”.  (emphasis added)

Independent research

1. The Writeway Research report dated 17 October 2001 reported that none of the non–commissioned officers in Mr Malady’s platoon had any knowledge of the alleged incident regarding an Indonesian with a weapon in which he had been told not to fire because the person was too far away.  The platoon sergeant said that they had friendly conversations with the Indonesian soldiers from whom they took over defence of the airport.  Section commanders confirmed that three trucks containing TNI soldiers drove past the platoon but nothing untoward happened and the Indonesians did not make any threatening moves towards them.

2. The Tribunal did not take this report into account in its Reasons.

Mr Kingsley

1. The clinical notes of Mr Kingsley, psychologist, for the period

   
   

   8 May 2001 to 4 September 2002 were before the Tribunal.

2. Mr Kingsley took an account of Mr Malady having rolled his ankle on recruit training and having trouble off and on for route marches; the tendon being too loose and kept popping out over the bone; having to avoid high impact and lower body PT.

3. Mr Kingsley also took (relevantly) an account that:

   “the highlights of my service in 2RAR were mateship…I arrived in Dilli East Timor in  Sept 1999.  I feel really bad about my time there.  I feel like I fucked up and let my mates down.

   …After about a week in Dilli I got crook, mostly dehydrated…We spent most of the time patrolling around Dilli…sometimes it felt like I could smell blood.  In one particular house the smell was real bad.  Maybe it was blood…After about 3 weeks I was picket one night and went to wake my relief and started spewing…At dawn I was still shaking so I staggered down to the medics billeted in a stable like building down the street.  I was assessed and sent down to the field hospital at the airport.  I was treated there for two days.  My temperature was over 40 degrees so I was pretty much out of it.  I remember waking up in a Hercules and being told I was going to Darwin.

   I was in the Royal Darwin Hospital for about one week.  Then I was sent to the airforce hospital for a few days.  Apparently I was diagnosed with shigella dysentery.”

4. Mr Kingsley also took an account of Mr Malady feeling like he doesn’t fit in.

5. While the Tribunal took into account Mr Kingsley’s records of

   
   

   Mr Malady’s drug consumption (at [86]–[87] of its Reasons), it did not consider his record of Mr Malady’s service history. 

Austin and Repatriation Medical Centre

1. On 21 September 2001, the Austin and Repatriation Medical Centre provided reports to Mr Malady’s solicitors regarding his treatment as an in-patient in June 2001 and admission for substance detoxification in September 2001.  The final diagnoses were PTSD, polysubstance abuse, antisocial personality traits and substance induced mood disorder.

2. Again on 22 April 2002 when he was awaiting sentencing in the County Court, the Austin and Repatriation Medical Centre provided another report to Mr Malady’s solicitors.  The author (Dr Kulijewicz) had seen Mr Malady on 3 occasions for 30 minutes each time to review his symptoms and stated that he had obvious symptoms of PTSD and depression, a history of polysubstance abuse, marital difficulties and forensic problems.  “There is a background of many developmental problems including parental conflict and separation and a history suggestive of conduct disorder”.

The Tribunal’s decision

1. The Tribunal found that Mr Malady suffers from:

   a)borderline personality disorder;

   b)PTSD;

   c)major depressive disorder;

   d)drug dependence or drug abuse; and

   e)alcohol dependence or alcohol abuse.

2. The Tribunal then said:

   “With respect to the five diagnosed conditions referred to earlier, they all, in our view, amount to a hypothesis of connection with service. There are SOPs with respect to all of the five conditions. The hypothesis, upon the evidence of the applicant and his witnesses and some of the doctors with respect to each of the diagnosed conditions is consistent with the template of the applicable SOP.  The hypothesis is therefore reasonable.  
   Each respective hypothesis as raised, contains one or more of the factors within the applicable SOP which the RMA has determined must exist as a minimum.

   
   

   The main focus in this and other applications involving the analysis of the four stages in Deledio is upon the fourth stage. That is whether there was no sufficient ground to determine that the illness, disease or injury was war–caused.  It is at this stage only that findings of fact are to be made and then related back to the relevant SOP. As His Honour decided in Meehan it is at this stage that we are required to determine whether there is “material to determine whether, as a matter of fact as distinct from hypothesis…within the terms of the Statement of Principles.”

Personality disorder

1. The Tribunal identified factor 1(a) in SoP No 143 of 1995 concerning personality disorder (namely ‘suffering a catastrophic experience that immediately preceded an enduring personality change to the level of disorder’) as the factor relied on.  It interpreted the definition of “catastrophic event” as requiring a single unexpected, overwhelming event such as a tsunami, an earthquake or volcanic eruption or observing or confronting human casualties following a bombing or battle and found that Mr Malady did not experience a catastrophic event (see [110] of its Reasons).

2. It was satisfied beyond reasonable doubt that there was no sufficient ground to determine that the condition of borderline personality disorder is war–caused (see [111] of its Reasons).

PTSD

1. The Tribunal identified factor 5(a) in SoP No 3 of 1999 concerning PTSD as the relevant factor.

2. After referring to Repatriation Commission v Stoddart [2003] FCAFC 300, the Tribunal found (at [116] of the Reasons) that Mr Malady had not “experienced, witnessed or confronted any event that objectively could reasonably be perceived as the actual or threat of death or serious injury as decided…in Stoddart.”  After referring to various matters, the Tribunal concluded that “on balance therefore we are satisfied beyond reasonable doubt that there is no sufficient ground for determining that PTSD is a war–caused disease” (see [117] of the Reasons).

Major depressive disorder

1. The Tribunal referred to factor 5(b) in SoP No 58 of 1998 concerning depressive disorder (“experiencing a severe psychosocial stressor, or stressors within the two years immediately before the clinical onset of depressive disorder”) as the applicable factor (see [119] of its Reasons). 

2. “Severe psychosocial stressor” is defined in clause 8 of that SoP to mean “an identifiable occurrence that evokes feelings of substantial distress in an individual, for example, being shot at, death or serious injury of a close friend or relative, assault (including sexual assault), severe illness or injury, experiencing a loss such as divorce or separation, loss of employment, major financial problems or legal problems”.

3. The Tribunal found that this definition of “severe psychosocial stressor” was of lesser intensity than the qualifying factors under the PTSD instrument, and it was satisfied that Mr Malady experienced such a stressor (see [121] of the Reasons).

4. The Tribunal reasoned, on the basis of what was said by Spender J in White v Repatriation Commission [2004] FCA 633, that the examples in the definition “are not definitive” and do not constitute the emotions (see [125] of the Reasons). The Tribunal was satisfied upon observing Mr Malady in evidence and having read the clinical data that he did experience a “severe psychosocial stressor” because he was exposed to events “which constitute objective ‘identifiable occurrences’, which subjectively, did evoke distress, which we regard as being substantial” (see [126] of the Reasons). The Tribunal found that Mr Malady “was distressed at the potential of him having to shoot at another person and thereby putting other persons in the vicinity at risk” and “upset at the presence and smell of blood in what was formerly a domestic residence where, having regard to previous atrocities, it would have been reasonable in our view for him to infer that the blood was from other persons” and “that the presence of dried blood on a roadway was from other persons who had been injured or wounded” (see [127] of the Reasons).

5. The Tribunal then said that “we are satisfied that the condition of depressive disorder – first found within the clinical notes of August 2000 – clearly permits a finding that the experience of the ‘severe psychosocial stressors’ did occur within two years before the clinical onset of the major depressive disorder”(see [127] of the Reasons).

6. Accordingly, the Tribunal concluded that it was “not satisfied beyond reasonable doubt that the condition of major depressive disorder is not war–caused” (see [128] of the Reasons).

Alcohol dependence or abuse and drug dependence or abuse

1. The Tribunal found that factor 5(b) of SoP No 76 of 1998 concerning alcohol dependence or alcohol abuse, and of SoP No 78 of 1998 concerning drug dependence or drug abuse, did not apply because

   
   

   Mr Malady had not experienced a “severe stressor”. (I note that relevantly the definition of “experiencing a severe stressor” in these two SoPs is almost identical to diagnostic criterion 2(b)(A) in SoP No 3 of 1999 concerning PTSD).

2. However, the Tribunal then considered factor 5(a) and found that “having regard to the evidence of the Austin and Repatriation Medical Centre, the reports of Dr Ridley and the notes of Dr Kingsley, together with the evidence of [Mr Malady] himself, there is much to suggest that [Mr Malady] was suffering a depressive disorder…at the time of the clinical onset of his alcohol dependence and drug dependence” (see [134] of the Reasons).

3. The Tribunal stated that “[Mr Malady] did consume alcohol prior to enlistment but on his own evidence he significantly reduced his consumption prior to travelling to East Timor and during his training immediately prior to his deployment.  He has subsequently consumed alcohol in enormous quantities where reference was made in the clinical notes to having spent, on one occasion, $150 upon alcohol in a binge session.  Dr Ridley has consistently referred to [Mr Malady’s] abuse of alcohol” (see [135] of the Reasons).

4. The Tribunal also stated that “it would appear from the documented evidence of Doctors Ridley and Kingsley that the frequency, quantity and type of drugs consumed by the applicant over many years permits us to find that the applicant had in fact been drug dependent”(see [136] of the Reasons).

5. The Tribunal then said that “consistent with evidence of Dr Strauss the substance abuse (which for this analysis we interpret to mean both alcohol and drugs) is related to the major depression which…we are satisfied has a connection with service (refer Transcript, page 78)”.  The Tribunal then concluded that it was “not satisfied beyond reasonable doubt that alcohol dependence and drug dependence are not war–caused.”

6. The Tribunal then set aside the decision under review and substituted a decision that the conditions of major depressive disorder, alcohol dependence or abuse and drug dependence or abuse are war–caused (see [139] of the Reasons).

The competing submissions

1. It is convenient to set out the Commission’s submissions in support of each of the grounds, after stating the ground, and set out Mr Malady’s submissions in reply, and conclude with a determination of the merit of each.

Ground 3.1

“The Tribunal erred in law, in that it failed to ask and answer the questions posed by s 120(3) and s 120A(3) of the Act when it found that there was a reasonable hypothesis connecting each of Mr Malady’s medical conditions with his war–service, without identifying each hypothesis and considering each hypothesis in light of the whole of the material before the Tribunal and of the template in the relevant SoP.”

The commission’s submissions on ground 3.1

1. The Tribunal did not identify the hypotheses.  Having found that

   
   

   Mr Malady suffered from a particular condition, it first erred by applying the SoP concerning that condition without considering whether all of the features of the condition in the SoP were present. 

   
   

   As Weinberg J said in Repatriation Commission v Gosewinckel (1999) 59 ALD 690 at [55]:

   “It is clear that the tribunal could not accept Dr Wahr’s opinion of generalised anxiety disorder without regard to the description of that disorder as set out in the SoP.  As the Full Court held in Shelton v Repatriation Commission [1999] 85 FCR 587 at [6] the SoP requires that the disease in question be “manifested by certain behaviour which is symptomatic of disease, not merely at any level of behaviour of that kind, whether or not it is symptomatic of the disease.”

2. As the Full Court of the Federal Court explained in Lees v Repatriation Commission [2002] FCAFC 398 at [16]:

   “While it is true that Statements of Principles are directed to causation, the means of establishing the necessary link in SoP between disease and war service is to require that the symptoms (or features) of the disease are, in a case such as the present, revealed within two years of the veteran experiencing a severe psychosocial stressor (relevantly, during operational service). This is intended to establish sufficient proximity between the experiences during operational service and the manifestation of the disease to point to a causal link to sustain the hypothesis.”

3. The Tribunal then made a second error by determining that the hypothesis connecting each of the conditions, from which it found that Mr Malady suffers, was reasonable simply because reliance was placed on a factor in the relevant SoP. 

4. In other words, the Tribunal did not ask itself (as s.120(3) of the Act required) whether the whole of the material pointed to each essential element of the SoP being met, including the element that any factor relied on had to be “related to” his service.  As Heerey J stated in Blair v Repatriation Commission [2005] FCA 1076 at [25]:

   “The Tribunal…was required to examine the evidence and did so. As the Full Court said in Repatriation Commission v Deledio (1998) 83 FCR 82 at 93, it is impermissible merely to assume or assert the facts which are said to found the hypothesis.”  

5. The Tribunal’s erroneous approach (at step 3 of the Deledio process) led it to fail to consider in respect of the hypothesis:

   91.1connecting Mr Malady’s PTSD with his war–service, the absence of evidence that he met the first diagnostic criterion in the definition of PTSD in clause 2(b)(A) of SoP No 3 of 1999, and the absence of material which pointed to him having experienced “a severe stressor” as defined in clause 8 of that SoP;

   91.2connecting Mr Malady’s major depressive disorder with his war–service, the expert evidence of a relationship between his borderline personality disorder and his major depressive disorder;

   91.3connecting Mr Malady’s alcohol consumption with his war–service, which of the two distinct conditions of alcohol dependence or alcohol abuse he suffers from and the expert evidence regarding the relationship between that condition and his borderline personality disorder; and

   91.4connecting Mr Malady’s drug consumption with his war–service, which of the two distinct conditions of drug dependence or drug abuse he suffers from and the expert evidence regarding the relationship between that condition and his borderline personality disorder.

6. Expert evidence regarding the relationship between Mr Malady’s personality disorder and depression, and between his personality disorder and his substance abuse was given by Dr Strauss.  Although the Tribunal had accepted Dr Strauss’ diagnosis of personality disorder, it failed to consider his oral evidence that Mr Malady’s substance abuse was secondary to his personality disorder and his depression developed from his profound sense of failure.  Quoting from the transcript,

   
   

   Dr Strauss stated:

   “Now with respect to the secondary diagnoses you talk about depression and substance abuse? ––– Yes.

   Are you putting to the Tribunal that they stand on their own or are they somehow co-morbid associated conditions? –––
   . 
   There are often inadequacies in personality development for whatever reason.  And the diagnosis of a borderline personality often does coexist with substance abuse because people with the condition often resort to substances to make themselves feel better, it is like a self medication.  And because of their poor functioning, both socially and often occupationally, depression often sets in.  It is a result if you like of the ongoing personality problems.  So these coexistent diagnoses are very frequent with the diagnosis of a borderline personality disorder, it is usual rather than unusual  (emphasis added)

   
   The diagnosis of a personality disorder implies usually problems with occupational functioning and social functioning
   

   What is causing the substance abuse? ––– I think generally his substance abuse has been secondary to his personality difficulties and his life experience difficulties.

   Would depression cause people to abuse drugs? ––– Yes, that is part of the picture.

   If the depression is related to Timor, isn't a drug abuse also related to Timor? ––– In a sense the drug abuse is related to Timor too, yes.

   Why? ––– Well, I think it is important to see this gentleman's situation globally and in a – and in temporarily.  In the past, before Timor, there have been experiences where he has been very unhappy and he has abused alcohol and drugs.  He came back from Timor feeling, I think, a profound sense of failure and there were great difficulties in his life after that.  He began to see things very negatively and became increasingly depressed and part of the depression and part of his way of coping because of his personality make-up is to abuse is to abuse drugs.  It is a self medication process.

   So, are they all ––– ? ––– They are all inter–related.

   ––– inter–related? ––– They are.

   Would it be not fair to say that they arose out of or they contributed to, at least, a service in Timor? ––– Yes, I have said that in my report that his world view changed significantly when the Timor experience didn't work out for him.

   And, in addition to that, although that may not be related directly to service

   in Timor they were certainly related to the circumstances of the way he felt about himself after he came back from Timor? ––– Yes, it was very much the effect on his self image and his confidence and how he saw himself in the world and his relationship with the Army and so forth”  (emphasis added)

7. The Tribunal also failed to consider the detailed explanation of the features of borderline personality disorder in Dr Strauss’ report. 

   
   

   Those features included:

   “Individuals with borderline personality disorder make frantic efforts to avoid real or imagined abandonment.  The perception of impending separation or rejection, or the loss of external structure, can lead to profound changes in self image, affect, cognition and behaviour.”

8. It failed to consider the evidence in Lt Ree’s clinical notes, as set out above, which Mr Malady did not fit in with his section that this medical classification had been downgraded and he was facing the prospect of discharge because of lower limb abnormalities before he reported any symptoms of anxiety or depression.

9. The Tribunal’s error of law also led it to fail to consider the other logically probative evidence and material identified above.

10. These errors by the Tribunal in its interpretation of what the Act and the authorities required of it in deciding whether the hypothesis or hypotheses were reasonable, were material to its decision. 

Mr Malady’s submissions on ground 3.1

1. In response Mr Malady contended that the Tribunal did not err as it identified a hypothesis that was reasonably connected to his service in Timor.  It was not necessary, he contended, that the Tribunal needed to quote all the material it examined in reaching the conclusion there was a reasonable hypothesis.

2. In any event, Mr Malady contends that should there have been an error, which he specifically denied, then it is of no moment as the Tribunal ultimately found that the PTSD was not war–caused.

3. In respect of the Commission’s criticism of the Tribunal not considering all of Dr Strauss’ evidence, he denies this and points to the fact Dr Strauss conceded that depression was a separate diagnosis and that the condition was associated with service in East Timor.

Conclusion on ground 3.1

1. With respect to Mr Malady’s contentions, they fail in my view to engage the issue raised by the Commission; namely, the approach to be taken at stage three of the Deledio stages to consider the whole of the material before it as it applied to each essential element of the applicable SoP.

2. In my view, the contentions of the Commission on this ground are well founded.  The fact that the Tribunal found that the PTSD was not war–caused, ignores the real issue as to the error the Tribunal exhibited by its approach in not considering that which was demanded of it under stage three.  The approach taken in respect of the PTSD condition is indicative of the error in approach by the Tribunal to the other conditions it found were war–caused.  To put the emphasis on stage four, at the expense of the proper considerations demanded by stage three, is to skew the process with the potential result of considering at stage four a hypothesis that would otherwise have been found not to be reasonable at stage three.

3. The Tribunal when it addressed stage three found that all five hypotheses under consideration were reasonable.  In doing so it did not identify them, but appears to have simply taken the approach that because the hypothesis echoes a factor in the SoP, it is reasonable. 

   
   

   That is clearly contrary to Hill.  His Honour Heerey J in Blair v Repatriation Commission (2005) FCA 1076 at [25] highlighted that it is impermissible to assume or assert facts which are said to found the hypothesis. The Tribunal did not adopt the right approach when it found that the hypothesis in respect of PTSD was reasonable even though all of the expert evidence is that it did not fit the template of the applicable SoP. In that example, there was not the evidence to support a finding that there was the kind of stressor referred to in the threshold diagnostic criterion in clause 2(b) of the SoP, namely:

   “The person who has been exposed to a traumatic event in which the person experienced, witnessed or was confronted with an event or events that involve actual or threatened death or serious injury or a threat to a physical integrity of self or others and the person’s response involving intense fear, helplessness and/or horror.”

4. All of the evidence before the Tribunal by Dr Strauss, Dr Cole and consistently with the material in Dr Green’s report was that the hypothesis did not meet that criterion.  Had the Tribunal applied the correct approach to stage three, it would not, (in this case, could not), have found the hypothesis reasonable.

5. Also illustrative of the wrong approach adopted by the Tribunal to its task under stage three is the question of the Tribunal finding that the hypothesis connecting the diagnosed personality disorder to war–service was reasonable.  Again there was no material before the Tribunal pointing to Mr Malady having suffered a catastrophic experience which is required by the applicable SoP.  If the Tribunal had applied the process properly at stage three, looked at the whole of the material and legal interpretation, it could not, in my view, have found the hypothesis reasonable.

6. On the issue of major depressive disorder, the Tribunal failed to consider all of the material addressing the relationship between borderline personality disorder and Mr Malady’s major depressive disorder.

7. I also note, but expand more fully on this point below, that the Tribunal failed to ask itself whether the whole of the material points to a time of clinical onset of the kind of major depressive disorder that Mr Malady has.

8. The approach of the Tribunal of not paying sufficient attention to the third stage of the Deledio process has lead to hypotheses being found reasonable which could not be reasonable having regard to the whole of the material as applied to the template set out in the relevant SoP. 

   
   

   In the words of  the Full Court in Hill at [53]:

   “…As the authorities show, however, in order to satisfy sections 120(3) and 120A(3) of the Act, there must be more than a hypothesis of connection that is consistent with the relevant SoP.  In order to satisfy these provisions, the material must “raise” or “point to” such a hypothesis and this hypothesis, as raised or pointed to by the material, must fit the relevant SoP.”

9. The ground is made out.

Ground 3.2

“The Tribunal erred in law when it approached the issues before the Tribunal on the basis that ‘the main focus in this and other applications involving the analysis of the four stages in Deledio is upon the fourth stage.”

The Commission’s submissions on ground 3.2

1. This ground is related to ground 3.1.  This particular erroneous interpretation of s.120 and s.120A of the Act is evident in [104] of the Tribunal’s Reasons. 

2. The Tribunal did not identify the hypotheses.  However, it is apparent, from [103] of its Reasons, that it considered that any hypothesis would be reasonable provided that it was couched in terms of a factor in a relevant SoP.  This approach is contrary to what was said by the Full Court in Deledio, in Hill and by Heerey J in Blair, and ignores the requirement in s.120A(3) that consideration must be given to the whole of the material before the Tribunal can form an opinion as to whether or not a reasonable hypothesis had been raised.

3. That the Tribunal failed to properly undertake step 3 of the Deledio process is evident from the Tribunal’s reasoning, at [106]–[110] of its Reasons, in relation to personality disorder. The Tribunal found that a hypothesis connecting that disorder with Mr Malady’s service was reasonable yet went on to (inconsistently) find that “none of those circumstances relied on by [Mr Malady] give rise to a ‘catastrophic event’ or constitute a ‘catastrophic experience’” having regard to the ordinary meaning of the word “catastrophe”.  In other words, a claim in respect of personality disorder did not fail at step 4 of the Deledio process because of any adverse finding of fact.  It failed because (as a matter of law) the events relied on were incapable of satisfying factor 1(a) of SoP No 143 of 1995 concerning personality disorder on the interpretation of the meaning of the factor. 

   
   

   It necessarily follows that (at step 3 of the Deledio process) there was no material before the Tribunal which pointed to factor 1(a) being met, and a reasonable hypothesis had not been raised.  (emphasis added)

4. The Tribunal made the same error of law in finding that there was a reasonable hypothesis connecting Mr Malady’s putative PTSD with his service when it said, at [116] of its Reasons, that:

   “[It was] not satisfied, and find as a fact, that there was no event or events that involved the actual or threat of death or serious injury to the applicant or to another person’s physical integrity.  Additionally we do not find that the applicant experienced, witnessed or confronted any event that objectively could reasonably be perceived as the actual or threat of death or serious injury as decided above in Stoddart.” 

5. The hypothesis based on his putative PTSD was not reasonable as a matter of law because the whole of the material did not point to the template in the SoP being met in two respects. 

   113.1First, it followed from the statement quoted above that the Tribunal was not satisfied that Mr Malady suffers from PTSD as defined in clause 2(b)(A) of SoP No 3 of 1999.  This meant that that SoP could not be relied on to found any connection with service.  The Tribunal made the error identified by Gray J in Repatriation Commission v Mines [2004] FCA 1331.

   113.2Secondly, the material could not have pointed to factor 5(a) in SoP No 3 of 1999 existing because, on the Tribunal’s own reasoning, the events relied on were incapable of meeting the definition in clause 8 of “experiencing a severe stressor”. 

Mr Malady’s submissions on ground 3.2

1. Again, Mr Malady’s response is to contend that the Tribunal did as was required of it; that it found that all of the diagnosed conditions raised a reasonable hypothesis of connection with service and then went on to apply the fact finding process set out in stage four.

Conclusion on ground 3.2

1. Once again, in my view, Mr Malady in his response did not engage with the issue raised by the Commission.  For the reasons set out by the Commission, as already stated, the Tribunal failed to do as was required of it under s.120 and s.120A of the Act.

2. This ground is also made out.

Ground 3.3

“In finding that Mr Malady’s major depressive disorder was war–caused, the Tribunal:

a)erred in its construction of the term ‘severe psychological stressor’ in the SoP for depressive disorder; and

b)failed to consider the whole of the material before the Tribunal, including the evidence of Dr Nigel Strauss that Mr Malady’s borderline personality disorder was the cause of his major depressive disorder, and the evidence that Mr Malady had been confronted with imminent discharge from the Australian Regular Army because of lower leg abnormalities before the veteran reported any symptoms of anxiety depression.”

The commission’s submissions on ground 3.3

Misconstruction of “severe psychosocial stressor”

1. The Tribunal erred in its understanding of what was said by Spender J in Repatriation Commission v White [2004] FCA 633. While the examples in the definition of “severe psychosocial stressor” are not exhaustive, they indicate the nature of occurrences which might objectively evoke substantial distress. Spender J rejected a submission that “an event which in fact evokes feelings of substantial distress in a person satisfies the definition of ‘severe psychosocial stressor’”.

   
   

   The nature of the occurrence must be “such as to evoke feelings of a particular kind in a person exposed to that occurrence and which, subjectively, evokes feelings of substantial distress in the particular person concerned.  Both aspects are relevant and necessary”.[30]

2. However, the Tribunal focused solely on Mr Malady’s subjective feelings in describing the events which it says “constitute objective ‘identifiable occurrences’ (see [123] and [127] of its Reasons), 

   
   

   The only reference to what might suggest an objective test is the Tribunal’s findings that it was “reasonable” for Mr Malady to infer that the blood he smelt in a domestic residence and the dried blood on a roadway was from other persons (see [127] of its Reasons). 

   
   

   However, the issue which the Tribunal had to consider was whether smelling blood or seeing dried blood (or any other putative event) was objectively capable of evoking feelings of substantial distress in a person who was not particularly vulnerable.

Failure to consider the whole material

1. The Tribunal described Dr Strauss as “a well credentialed and experienced psychiatrist who gave his opinion within the ambit of his expertise” and his report as “comprehensive” (see [94] of its Reasons).  It accepted Dr Strauss’ diagnosis of borderline personality disorder.

2. However, the Tribunal did not consider Dr Strauss’ written evidence that he did not believe that Mr Malady had suffered from a “severe psychological stressor” in East Timor, or his oral evidence that

   
   

   Mr Malady “came back from Timor feeling a profound sense of failure…began to see things very negatively and became increasingly depressed”. 

3. The Tribunal also failed to consider the records of assessments by psychologists Robert Zamatis and Lt Rees regarding Mr Malady’s sense of failure and frustration, his concerns at the prospect of discharge due to lower limb problems and his related anger and depression.

4. Even though there was uncontradicted (and irrefutable) evidence before the Tribunal that one of the two reasons why Mr Malady was classified as medically unfit for service was his lower limb abnormalities, the Tribunal failed to consider the effect of his imminent loss of Army employment on Mr Malady’s mood (particularly in light of his borderline personality disorder).  

Mr Malady’s submissions on ground 3.3

1. Again, Mr Malady contends that the Tribunal, after referring to the definition of “experiencing a severe stressor” and quoting a lengthy passage from Stoddart’s case, did not err and contended that the Tribunal did consider the necessary objective element.  In respect of the contention that the Tribunal failed to consider the whole of the material, he simply states that it did.

Conclusion on ground 3.3

1. I am persuaded by the contentions of the Commission on this ground.

2. The Tribunal identified events involving blood and the person who might have been armed.  However, in doing that it did not ask itself the proper question; namely, whether those events are of a kind capable of evoking feelings of substantial distress.  It found that:

   “It was reasonable for Mr Malady to infer that the blood he smelt in a domestic residence and the dried blood on a roadway was from other persons.”

3. However, the Tribunal, in my view, had to ask itself whether smelling blood or seeing dried blood or any other putative event was objectively capable of evoking feelings of substantial distress in a person who was not particularly vulnerable.

4. When considering the definition of “severe stressor” his Honour Mansfield J in Stoddart at [50] stated:

   “I do not think it provides for idiosyncratic and personal perceptions of events which, judged objectively, do not fall within the adjectival clause.”

5. Although the Tribunal was dealing with the definition of “severe psychological stressor”, the comments of Mansfield J have application.  The Tribunal in my view failed to ask itself the proper question.  If it had understood and was properly applying the definition of “experiencing a severe psychological stressor” the question was whether the identified event was objectively capable of evoking feelings of substantial distress in a person who was not particularly vulnerable and is not just displaying an idiosyncratic perception.

Ground 3.4

“In finding that Mr Malady suffered from alcohol dependence or alcohol abuse, the Tribunal erred in law by failing to find from which of those two distinct medical conditions Mr Malady was suffering.”

The commission’s submissions on ground 3.4

1. The Tribunal erred in making a diagnosis that Mr Malady suffered from alcohol dependence or alcohol abuse (see [99] of its Reasons).  Alcohol dependence is a distinct condition and alcohol abuse is a distinct condition.  The two conditions attract different classification numbers in DSM-IV (respectively classified as 303.9 and 305).  Alcohol abuse is diagnosed only if the symptoms have never met the criteria for alcohol dependence.  In other words, the conditions are mutually exclusive. 

2. SoP No 76 of 1998 applied to alcohol dependence and to alcohol abuse.  Factor 5(a) in that SoP requires that a person be “suffering from a psychiatric disorder at the time of clinical onset of the alcohol dependence or alcohol abuse”.  The date of clinical onset is when a clinician would recognise that all of the symptoms required in the definition of a disease were present.

3. It follows that without a finding as to which of the two distinct conditions of alcohol dependence or of alcohol abuse Mr Malady suffers, the Tribunal could not determine whether the whole of the material before it pointed to factor 5(a) existing (at step 3 of the Deledio process) or make a finding as to the date of clinical onset (at step 4 of the Deledio process). 

Mr Malady’s submissions on ground 3.4

1. Mr Malady contends that SoP 76 of 1998 provides for the two conditions and that both relied upon the connection of suffering from a psychiatric disorder at the time of clinical onset of the condition.  Further, he contends that the Tribunal made a finding, after considering the doctor’s reports and oral evidence that it was appropriate to make the diagnosis of both dependence and abuse.

Conclusion on ground 3.4

1. With respect, again Mr Malady has failed to engage with the issues raised by the Commission.  It is quite evident, in my view, that the conditions of dependence or abuse are mutually exclusive and it fell to the Tribunal to determine which was appropriate and when its clinical onset happened.  In failing to do so, the Tribunal erred.

2. This ground is made out.

Ground 3.5

“The error of law identified in ground 3.4 led the Tribunal into further error of law in that the Tribunal:

a)failed to find that the material pointed to the date of clinical onset of the condition from which Mr Malady was suffering; and

b)could not, therefore, make a finding that there was a hypothesis of connection that was upheld by the relevant SoP.”

The commission’s submissions on ground 3.5

1. The Tribunal found that “there was much to suggest that [Mr Malady] was suffering from a depressive disorder (being the ‘psychiatric disorder’) at the time of the clinical onset of his alcohol dependence” (see [134] of its Reasons).  In so finding, the Tribunal did not have regard to symptoms of “alcohol dependence” in clause 2(b) of SoP No 76 of 1998.

2. The Tribunal simply referred to Mr Malady’s evidence that he “significantly reduced his consumption prior to travelling to East Timor and during his training immediately prior to his deployment”, and to

   
   

   Dr Ridley’s evidence regarding Mr Malady’s drinking after his discharge (see [135] of its Reasons).  However, the symptoms of alcohol dependence (or the symptoms of alcohol abuse) are not concerned with the quantities of alcohol consumed (see clause 2(b) of SoP No 76 of 1998). 

3. Unless all of the requisite symptoms were present at the putative date of clinical onset, reliance could not be placed on factor 5(a) in that SoP to establish any connection between Mr Malady’s alcohol related condition and his operational service.  The Tribunal made the error identified by Weinberg J in Gosewinckel and by the Full Court in Lees.

4. The Tribunal again exposed its erroneous approach by stating that it was satisfied beyond reasonable doubt that there is not sufficient ground to determine that his “alcohol dependence or abuse” was not war–caused (see [138] of its Reasons).

Mr Malady’s submissions on ground 3.5

1. Mr Malady contends that there is no need to rely on the SoP as a prerequisite to the diagnosis of a condition, and went on to allege the Commission did not identify the error in the Tribunal’s decision as identified in Gosewinckel.

Conclusion on ground 3.5

1. Once again, Mr Malady’s response does not engage with the issued raised by the Commission.  When assessing the reasonableness of the hypothesis against the template of the SoP the Tribunal was obligated to have regard to symptoms of “alcohol dependence” in clause 2(b) of SoP 76 of 1998.  It was also obligated to determine the time of clinical onset of the alcohol dependence.

2. Where a factor in a SoP relies on “clinical onset” it is imperative, in my view that after a consideration of the whole of the material at stage three, there must be evidence pointing to a date for the clinical onset.  If there is not, at stage three, it can be concluded that the hypothesis is not reasonable.  The meaning and significance of “clinical” is discussed below.

3. It is true that the Tribunal referred to Mr Malady having reduced his consumption of liquor prior to travelling to East Timor during his training and prior to his deployment.  The actual volumes drunk and frequency with which they were drunk are not symptoms of either alcohol dependence or alcohol abuse.  The symptoms really go to the effect or impairment that is caused, not the volume, which may clearly be different for different people.  It was only the changed pattern of consumption, which justified the Tribunal finding that the material pointed to the date of clinical onset.  In doing so, however, the Tribunal made a finding that could not be supported by the SoP, because the Tribunal was having regard to matters that are not within the relevant diagnostic criteria.  This is the error identified in relation to a different condition identified in both Gosewinckel and Lees.  In my view, the Commission’s contentions supporting this ground clearly identify the error exposed in Gosewinckel.

4. The relevance of the stipulation to determine the “clinical worsening” was considered recently by his Honour Finn J in Repatriation Commission v Milenz [2006] FCA 1436. In a similar consumption scenario the Tribunal in that case described a change in the quantity type and frequency of alcohol consumption and concluded that there had been a “clinical worsening” of alcohol abuse, which was in turn attributed to a severe stressor. Although this case considered the meaning of “clinical worsening”, it has clear application to the expression used in SoPs of “clinical onset”.

5. His Honour determined that:

   “What is clear, in my view, is that the Tribunal misconstrued what was comprehended by the clinical worsening requirement of par 5(d) of the SoP.  That requirement imposed a medical-scientific, not a lay standard.  Though the Tribunal found a clinical worsening of Mr Milenz’s alcohol abuse, it did not address whether there was a worsening in the disease as defined and manifest.  It simply inferred a worsening because, “after operational service, the quantity, type and frequency of alcohol consumed was far greater”.  These are not features or manifest symptoms of the disease defined in par 2(b) of the SoP.

   The consequence of the Tribunal so treating par 5(d) is that the actual hypothesis it considered was pointed to on the material before it was not one upheld by the SoP.”

6. What the Tribunal has done in this case is what was identified as improper in Milenz.

7. For the reason set out in the Commission’s contention, this ground is made out.

Ground 3.6

“In finding that Mr Malady’s alcohol dependence or alcohol abuse was war–caused, the Tribunal failed to consider the whole of the material before the Tribunal, including the evidence of Dr Nigel Strauss that Mr Malady’s substance abuse was related to his borderline personality disorder.”

The commission’s submissions on ground 3.6

1. The Tribunal diagnosed Mr Malady as suffering from borderline personality disorder. It found that that disorder was not war–caused. 

2. The Tribunal failed to consider the evidence of a relationship between Mr Malady’s borderline personality disorder and his substance abuse.  It failed to consider the evidence of Dr Strauss in this regard. 

Mr Malady’s submissions on ground 3.6

1. Mr Malady contended that there was no requirement for the Tribunal to consider the relationship between personality disorder and substance abuse, as each of the conditions were subject to a SoP and could be causally linked with service via clauses of each of the SoPs.

Conclusion on ground 3.6

1. Set out above, in some detail, is evidence before the Tribunal that was clearly relevant to this issue that required, in my view, canvassing and analysis by the Tribunal and which was not addressed in its decision.  The Tribunal was required to consider the whole of the material before it but manifestly ignored that which was clearly pertinent and which, had it been considered at the third Deledio stage, may have caused the Tribunal to conclude that the hypothesis was not reasonable.

2. This ground is also made out.

Ground 3.7

“In finding that Mr Malady suffered from drug dependence or drug abuse, the Tribunal erred in law by failing to find from which of those two distinct medical conditions Mr Malady was suffering.”

The commission’s submissions on ground 3.7

1. Drug dependence and drug abuse are also distinct and mutually exclusive conditions.  Drug abuse is diagnosed only if the symptoms have never met the criteria for drug dependence (see clause 2(b) of SoP No 78 of 1998).

2. The Tribunal made the same errors in respect of Mr Malady’s drug related condition as it did in respect of his alcohol related condition in ground 3.4 above.  It found that Mr Malady “suffers from drug dependence or drug abuse” (see [99] of its Reasons). 

Mr Malady’s submissions on ground 3.7

1. Mr Malady in effect repeats his contentions for ground 3.4.

Conclusion on ground 3.7

1. For the same reasons as set out in ground 3.4, this ground is made out.

Ground 3.8

“The error of law identified in ground 3.7 led the Tribunal into further error of law in that the Tribunal:

a)failed to find that the material pointed to the date of clinical onset of the condition from which Mr Malady was suffering; and

b)could not, therefore, make any finding that there was a    hypothesis of connection that was upheld by the relevant   SoP.”

The commission’s submissions on ground 3.8

1. The Tribunal found that “there was much to suggest that [Mr Malady] was suffering from a depressive disorder (being the ‘psychiatric disorder’) at the time of the clinical onset of his drug dependence” (see [134] of its Reasons).  In so finding, the Tribunal did not have regard to symptoms of “drug dependence” in clause 2(b) of the SoP.

2. The Tribunal then said, at [136]–[137] of its Reasons, that:

   “With respect to the SoP concerning drug dependence it would appear from the documented evidence of Doctors Ridley and Kingsley that the frequency, quantity and type of drugs consumed by the applicant over many years permits us to find that the applicant had in fact been drug dependent (emphasis added).

   Consistent with evidence of Dr Strauss the substance abuse (which for this analysis we interpret to mean both alcohol and drugs) is related to the major depression which for reasons found above we are satisfied has a connection with service.”

3. It is apparent that the Tribunal did not attempt to identify a date at which the requisite clinical symptoms of drug dependence or drug abuse were present.  (The symptoms of drug dependence or drug abuse in clause 2(b) of SoP No 78 of 1998 are not “the frequency, quantity and type of drugs”).

4. Having regard to the principles established in Gosewinckel and Lees, it follows that factor 5(b) of SoP No 78 could not uphold a connection between Mr Malady’s operational service and his drug dependence or drug abuse.

5. The Tribunal again exposed its erroneous approach by stating that it was satisfied beyond reasonable doubt that there is not sufficient ground to determine that his “drug dependence or abuse” is not war–caused (see [138] of its Reasons).

Mr Malady’s submissions on ground 3.8

1. Mr Malady contends that there was no requirement on the Tribunal to go into the detail suggested by the Commission in its contentions. 

   
   

   The failure to appoint a date of onset was, Mr Malady contends, immaterial to the Tribunal’s consideration as it clearly implied that it was within the time frame contemplated by the SoP.

2. In addition, Mr Malady contended that Dr Strauss’ evidence confirmed that his service was connected to the onset of major depression.

Conclusion on ground 3.8

1. In respect of the last contention, Mr Malady fails to put Dr Strauss’ evidence into context.  Whilst Dr Strauss said that his depression was to an extent related to his service in Timor, its cause was primary related to other factors apart from his service that would not entitle him to the disability pension he was claiming.

2. In respect of the need for the Tribunal to identify the date of onset, I refer to and repeat [143]–[145] above.

3. This ground is also made out.

Ground 3.9

“In finding that Mr Malady’s drug dependence and drug abuse was war–caused, the Tribunal failed to consider the whole of the material before the Tribunal, including the evidence of Dr Nigel Strauss that the veteran’s substance abuse was related to his pre-existing borderline personality disorder.”

The commission’s submissions on ground 3.9

1. The Tribunal failed to consider the evidence of Dr Strauss that

   
   

   Mr Malady’s drug abuse was related to his personality disorder.

Mr Malady’s submissions on ground 3.9

1. Mr Malady asserts that Dr Strauss’ evidence was but one factor, and that it was not an error for the Tribunal to link drug dependence or abuse with other evidence and circumstances of service.

Conclusion on ground 3.9

1. In my view, the Commission’s contentions supporting this ground clearly identify the error exposed in Gosewinckel.

2. In view of the evidence before the Tribunal on the question of

   
   

   Mr Malady’s personality disorder and its relationship with issues associated with alcohol and drug abuse or dependence, it was incumbent on the Tribunal to give consideration to this issue in its reasons.  There was a legislative imperative imposed on it to so when having consideration to the whole of the material before it.  It could not simply be ignored.

3. This ground is also made out.

Mr Malady’s general submission

1. Mr Malady by way of general submission invoked s.119(1)(g) of the Act which imposes on the Tribunal an obligation to act according to substantial justice and the substantial merits of the case, without regard to legal form and technicalities.  This invocation, as I understand it, was put by way of buttressing Mr Malady’s general contention that the Tribunal was experienced, had generally got it right and any error illustrated by the Commission could be dismissed as going to form and technicality, as opposed to the substance and justice of Mr Malady’s case.

Conclusion on general submission

1. In my view there is nothing in s.119(1)(g) that goes to any of the grounds, or is any answer to any of the grounds advanced by the Commission. As his Honour Gray J in Knight v Repatriation Commission (2002) FCA 103 at [29] stated:

   “Not only does section 119(1)(g) not override the provisions of the act, it does not override the provisions of an instrument made under statutory authority including the statement of principles.”

Conclusion

1. For the above reasons, the appeal should be upheld and the Tribunal’s decision set aside.

I certify that the preceding one hundred and seventy-three (173) paragraphs are a true copy of the reasons for judgment of O’Dwyer FM

Associate: 

Date:  8 December 2006