Repatriation Commission v Moss

[1982] FCA 54

Re: REPATRIATION COMMISSION
And: DAVID MOSS
No. G130 of 1981
Administrative law

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Fox J.
Deane J.
Fitzgerald J.

CATCHWORDS

Administrative law - appeal from Administrative Appeals Tribunal - whether respondent had an existing partial incapacity caused by pulmonary tuberculosis at date of review by Repatriation Commission - whether "incapacity" refers to physical or mental disability or impairment rather than inability to work or earn in the context of the Repatriation Act, 1920.

Repatriation Act, 1920 ss.24, 27, 31, 37(repealed), 48, 101, 107VZZB; Schedule 1, Column 3; Schedule 3, Table C;

Repatriation Acts Amendment Act, 1978 s.40

Federal Proceedings (Costs) Act, 1981, s.6

HEARING

SYDNEY

#DATE 22:4:1982

ORDER

1. THE appeal be allowed.

2. THE decision of the Administrative Appeals Tribunal be set aside and in lieu thereof, the decision of the Repatriation Commission be restored.

3. EACH party pay its or his own costs.

JUDGE1

The Repatriation Commission appeals pursuant to s.43 of the Administrative Appeals Tribunal Act, 1975 on a point of law, against a decision of that Tribunal that the respondent is entitled to a pension in respect of tuberculosis. The matter came before the Tribunal on a reference by the President of the Repatriation Review Tribunal under s. 107VZZB(1) of the Repatriation Act, 1920.

The respondent Mr. Moss was born on 3 April 1922. He left school when 15, after completing his Intermediate Certificate. He enlisted as a member of the Forces in June 1941 and served until April 1946. After his discharge he did some timber felling and banana farming in Queensland, although for what periods is not clear.

For some months in late 1947 he worked as a machine driver in an underground gold mine in Queensland, and left that position to work as an underground machine operator for the New South Wales Metropolitan Water, Sewerage and Drainage Board in a project which included the construction of a large tunnel. Soon after reporting for that position an x-ray disclosed pulmonary tuberculosis and he was put into hospital. On 21 January 1948 his tuberculosis was accepted as due to war service and a pension for him was assessed at the statutory minimum of 100% of the "General Rate". After release from hospital, he took up clerical work, and started a part-time course in accountancy. He soon had a recurrence of tuberculosis, and after discharge from hospital on this occasion did not resume the accountancy course. He started work as a stock clerk and did well in that activity, getting over a time a series of better positions and a degree of promotion. His lack of education and formal training have in recent years operated as a handicap, and his earnings have fallen back relative to those of people with higher qualifications. The Tribunal found that it was a case "where, because of his tuberculosis, he was precluded from continuing in the type of work to which he was most suited, that is to say, some form of outdoor or semi-outdoor work in which he could ultimately develop to foreman or executive status." It went on:

"We think that that limitation upon him is an incapacity for which an assessment is justified."

On 1 November 1978 the Repatriation Acts Amendment Act, 1978 came into force. By that Act s.37 of the Repatriation Act, 1920 (which provided specially for pensions for pulmonary tuberculosis) was repealed. In its place a series of sections of the 1978 Act (secns. 37-41) were enacted to deal with that disability. Sub-sections (1), (2) and (4) of s.40 are as follows:

"(1) In this section, 'review', in relation to a pension, means a review conducted under section 31 of the Repatriation Act 1920 for the purpose of -

(a) assessing the nature, and probable duration, of the incapacity in respect of which the pension is payable; and

(b) assessing the appropriate rate of that pension having regard to -

(i) the assessment referred to in paragraph (a);

(ii) any relevant provisions of the Repatriation Acts in force at the time of the review; and

(iii) the provisions of this Part.

(2) The Repatriation Commission shall, as soon as practicable after the commencement of this Part, conduct a review with respect to every pension payable in respect of incapacity caused by pulmonary tuberculosis, being a pension that has been so payable since before the commencement of this Part.

(4) The Repatriation Commission shall not, on the completion of a review with respect to a pension in accordance with sub-section (2), and a determining Authority shall not, at any time after the completion of that review under sub-section (2), determine the rate of the pension to be a rate less than -

(a) where the pension is payable to a member of the Forces - the rate of $74.40 per fortnight; or

(b) where the pension is payable to a dependant of a member of the Forces - the rate at which the pension was payable immediately before the commencement of this Part."

The terms of s.31 of the 1920 Act, referred to in s.40(1), do not have any particular significance for this case. The rate of $74.40 per fortnight specified in sub-secn. (4) is commonly known as the "frozen rate".

On 2 July 1979 the Commission made this determination in respect of the respondent's tuberculosis:

"In these circumstances, the Commission determines the extent of actual incapacity in respect of pulmonary tuberculosis to be negligible with effect from 2 November 1978."

The two paragraphs preceding this determination were as follows:

"The Specialist went on to say that the member is not suffering any incapacity from pulmonary tuberculosis and he considered that the assessment for pension purposes is negligible. In addition he stated that the member's symptoms are the result of recurrent bronchitis. After considering the whole of the evidence, the Commission accepts the opinion expressed by the Chest Specialist as to the extent of incapacity resulting from pulmonary tuberculosis. This opinion is considered to be reasonable and is in accordance with the principles of assessment adopted by the Repatriation Commission."

The Tribunal disagreed with the determination of the Commission set out above and assessed Mr. Moss' incapacity caused by his pulmonary tuberculosis at 30 per cent of the General Rate for total incapacity, which is $76.90 per fortnight. No separate question arises on this appeal concerning the rate assessed by the Tribunal. Mr. Moss has separate pension entitlements for deafness disabilities. Pursuant to s.40(4) of the 1978 Act, the amount of the pension determined by the Commission was $74.40 per fortnight, and this determination was not affected by the Tribunal's decision. What the Tribunal held to be wrong was the nil determination in respect of tuberculosis, and because, as it said, the Commission had proceeded on a wrong basis, it set aside its decision in toto. No argument has been raised before us as to whether this was a correct way of dealing with the matter; the question debated has been the one of substance respecting an entitlement related to tuberculosis.

The Tribunal obviously gave close attention to the factual and legal considerations involved. I set out selected passages from the joint reasons of the members of the Tribunal (Davies J, Mr. F.J. Mahoney and Dr. M. Glick):

"On the evidence, therefore, we are satisfied beyond reasonable doubt that Mr. Moss is not presently suffering from any physical or mental condition related to his tuberculosis which is limiting his activity or affecting his health." . . . "This brings us to the crux of the case which is that, notwithstanding that there is no present medical condition which limits his capacity, nevertheless the tuberculosis did limit Mr. Moss' capacity to engage in employment and that that limitation is having a current effect upon his income earning ability. The tuberculosis precluded Mr. Moss from continuing in the form of outside employment to which he was most suited and diverted him to indoor employment in the area of stores and accounting to which he was less fitted by reason of his relatively low level of education and his lack of academic training." . . . "The evidence concerning tuberculosis does not disclose any present incapacity other than a limitation upon his ability to earn income. In this last respect, it appears that his pulmonary tuberculosis precluded his continuing in the field of work to which he was most suited. The evidence discloses that the margin between the remuneration which he may have received had he not suffered pulmonary tuberculosis and the remuneration which he now received is almost 25%."

The question we are asked to decide is whether the Tribunal erred in law. In particular, the question concerns the meaning of "incapacity" and whether the Tribunal was right in finding that there was incapacity when the physical condition had abated.

In general, and so far as material for the present case, the body of the Act merely refers to the payment of "pensions", their duration and broadly the bases of eligibility for them (see s.24 of the 1920 Act). Section 35 provides that (so far as material) rates of pension are those specified in the Schedules.

The provisions of the Schedules are rather awkwardly set out, and somewhat elliptical in expression. Schedule 1 deals with "General Pensions Rates". Column 3 of this schedule provides for "total incapacity", and specifies the rate of $76.90 already referred to. Paragraph 3 of the Schedule deals with a member who is "temporarily totally incapacitated to such an extent as to be precluded from earning other than a negligible percentage of a living wage while he is so incapacitated", and, in effect, provides for a higher rate at the discretion of the Commission. The only other paragraph (para. 6) of this Schedule relates to a case "where the incapacity of a member of the Forces is such that he is unable to earn a living wage by reason that he is unable to engage in a remunerative occupation except on a part-time basis or intermittently" and provides that the rate is to be $140.30. Schedule 2 provides for "Special Pensions" of $203.80 per fortnight. These are granted to members who have been blinded as the result of war service, and to members "who are totally and permanently incapacitated (i.e. incapacitated for life to such an extent as to be precluded from earning other than a negligible percentage of a living wage)."

Schedule 3 deals in Table A with pensions payable in the case of death of a member of the Forces, in Table B with cases of total incapacity, and in Table C with cases of "partial or specific incapacity" of members of the Forces. Table B is inter-related with Schedules 1 and 2. Table C provides for "Such rate, being less than the rate of the maximum rate, as the case may be, prescribed by Table B of this Schedule, as is assessed, having regard to the nature and probable duration of the incapacity, or in accordance with Schedules 4 and 5 in the cases to which those Schedules apply".

Schedule 4 deals with rates of pension payable in respect of specified "disabilities", the rates being related to total incapacity entitlements under Schedule 3. Schedule 5 also deals with specified disabilities but provides for stated amounts to be paid per fortnight in addition to the pension payable under Schedule 4. Adjustments with entitlements under other schedules are provided for. Pensions, in general, are indexed, or at least indexed upwards, by reference to the All Groups Consumer Price Index (s.35AAA).

It is to Table C of Schedule 3 that the present case directs attention. What it requires is an assessment, and an assessment of a rate, and the rate is applied to a fixed sum. No reference is made to economic loss, and no provision is made there, or elsewhere, for machinery to determine economic loss, either initially or from time to time. The fact is that the Acts in question provide for pensions. They are not analogous to workers' compensation, or employees' compensation legislation, where the central emphasis is on employment-related loss of earnings, temporary or permanent. The fact that provision is made for lump sum payments and limits are placed on amounts of compensation does not affect the general nature of that type of legislation. The central question there is the affect of injuries or diseases on economic capacity. In the Repatriation Acts, pension payments are, so far as relevant, related to war-caused incapacities or disabilities. The latter lead directly to prescribed entitlements. The fact that "incapacity" relates primarily and principally to physical or mental incapacity is apparent from a number of provisions of the 1920 Act. Section 24 refers to incapacity resulting from an occurrence, but provides that to be pensionable it should not arise from "intentionally self-inflicted injuries". Section 27 refers to incapacity resulting from an occurrence during war service, or contributed to, or aggravated by, conditions of war service. Section 48(1)(b) requires a medical practitioner reporting on a claim to set out his opinion on, among other matters, "extent of the incapacity". There is no need to pursue this point; it has already been emphasised in decisions of this Court (see, for example, Repatriation Commission v Bowman, Full Court, 25 November 1981).

This is not to say that in some cases, at least, such as those of partial incapacity, an assessment must be confined to a consideration of the nature or extent of physical or mental injuries. On the contrary, the very notion of incapacity involves consideration of capacity for something; some external frame of reference is necessary. Although, strictly speaking, the question does not arise in this case, my present view is that incapacity should to some extent, even if only in a general way, take account of what the physical or mental disability or disabilities mean to the capacity of the particular individual to earn and to enjoy life. Such an approach may or may not operate in his favour. I understand from a document in the appeal book that the Commission has long followed a practice along these lines. What is of importance for present purposes is that the Act requires that a relevant physical or mental condition must exist as the basis for an assessment. This means a condition existing at the time of assessment.

The amounts of the prescribed pensions, being fixed, do not accommodate to economic loss in fact suffered. In the present case the Tribunal assessed loss of earnings at 25 per cent, and then translated this into 30 per cent of the General Rate, as being roughly the equivalent. A similar approach obviously could not be followed in many cases. If economic loss were to be regarded as a matter of primary or direct concern, it would seem to follow that pensions would not be payable at all, or would be payable only at a very low rate, if no economic loss could be established. What is done in the Act is to marshall types of incapacity and disability and degrees of effect on earning ability into particular schedules, and parts thereof, and to provide, somewhat arbitrarily, for the pensions payable. So, while paragraphs 3 and 6 of Schedule 1, and Schedule 2, deal with earning ability, they do so by way of providing classification and indicating entitlement. To take one example, paragraph 6 of Schedule 1 is instructive; it points to "the incapacity" and the consequence. The consequence postulated being inability to earn a living, the result is nevertheless a fixed rate of pension. In a sense, the paragraph provides one meaning of "total incapacity". Schedule 2, in its first paragraph, provides a definition of "totally and permanently incapacitated".

Table C of Schedule 3 provides for a pension to be payable, in cases of partial incapacity, at such rate as is assessed having regard to the nature and probable duration of the incapacity. In both places "incapacity" requires the existence of a physical or mental incapacity, the "nature" of which is determinable. If there is no incapacity there is no provision for payment of a pension. Economic consequences flowing from a physical or mental condition from which there has been complete recovery, or where complete restoration has been effected, are not provided for.

In the present case the Tribunal did not find that the economic consequences were an immediate result of the condition, but rather that they were the current result of the tuberculosis having interrupted the pursuit of a livelihood which would now be more profitable than that which he did take up. The fact that the consequences are postponed would not disentitle Mr. Moss from a pension, if he was otherwise entitled to one. On the contrary, if he still suffered from tuberculosis the consequences could lead to an increased pension. In fact, because of the special provisions made concerning tuberculosis, the pension presently payable more than compensates for the loss suffered, even when the compensation entitlements for deafness are taken into account.

I am therefore of the view that the appeal should be allowed, the decision of the Tribunal set aside, and the determination of the Repatriation Commission restored. Senior Counsel for the applicant said that in the event of success his client would not seek an order for costs. This is I think a proper attitude in the circumstances (see the terms of s.107VZZB(1)). It is open to the respondent to apply for a certificate under s.6 of the Federal Proceedings (Costs) Act, 1981.

JUDGE2

The Repatriation Commission appeals, on a question of law, from a decision of the Administrative Appeals Tribunal ("the Tribunal") to the effect that the respondent, Mr. David Moss, had an existing partial incapacity caused by pulmonary tuberculosis which, if viewed in isolation, would entitle him to receive a pension under the provisions of the Repatriation Act, 1920 ("the Act") of 30 percent of the General Rate specified in Column 3 of the Table in Schedule I to the Act. The narrow, albeit important, point of law to be decided is whether, on the facts found by the Tribunal, Mr. Moss could properly be found to have had, at the date of the review, any such partial "incapacity" within the meaning of the legislation. If that question is answered affirmatively, the further question arises whether, on those findings of fact, it was open to the Tribunal to assess, as it did, the degree of such partial incapacity as 30% of "Total Incapacity" as referred to in the Schedules to the Act.

Mr. Moss is 59 years of age. He is a married man with three children aged 15, 13 and 12. He left school at the age of 15 after completing his Intermediate Certificate and joined the work force. He enlisted in June 1941 and served in the A.I.F. from that time until April, 1946 when he was discharged.

After his discharge, Mr. Moss worked in a number of different occupations in Queensland including, in late 1947, that of a driver of a machine in an underground mine in Proserpine. In early 1948, he obtained a position with the Metropolitan Water Sewerage & Drainage Board in Sydney as an underground machine operator in a project involving the construction of a large tunnel. He was required, for the purposes of that employment, to be X-rayed. The X-ray disclosed that he was suffering from pulmonary tuberculosis. He was hospitalized for some months. It is common ground that he was prevented by tuberculosis from pursuing his employment with the Metropolitan Water Sewerage & Drainage Board. Upon his discharge from hospital, he obtained employment as a stock clerk and commenced to study accountancy by way of a correspondence course. The strain of working by day and studying by night took its toll and he was again hospitalized with active tuberculosis. In all, he spent some ten months in hospital obtaining the rest and good food which then constituted the accepted treatment for tuberculosis.

On 21 January, 1948, Mr. Moss' tuberculosis was accepted as being due to war service. He was, on any approach to the meaning of the word "incapacity", suffering an "incapacity" caused by pulmonary tuberculosis. Section 37(1) of the Act provided, at that time, that the rate of pension payable to a member of the Forces in respect of incapacity caused by pulmonary tuberculosis should be not less than the general rate specified in Column 3 of the Table in Schedule 1 to the Act. In accordance with that provision, Mr. Moss' pension entitlement was assessed at one hundred percent of the general rate. At that time, s.37(2) of the Act provided that "any such pension" should not be terminated or reduced below the general rate "unless it is shown that the pension was obtained by fraud or impersonation". The apparent legislative guarantee contained in that sub-section was, however, susceptible to being destroyed by repeal or amendment.

The medical evidence which was accepted by the Tribunal established that Mr. Moss' pulmonary tuberculosis is now healed and inactive. There is no existing appreciable physical incapacity resulting from it. At most, he has a latent condition in respect of which there is only a very small risk of re-activation and in respect of which, if any of the circumstances which might lead to re-activation should become present (e.g., diabetes or alcoholism), adequate treatment could be given. His only existing appreciable physical incapacity attributable to his war service is partial deafness in each ear.

At the time of the commencement of the Repatriation Acts Amendment Act, 1978 ("the Amendment Act"), Mr. Moss was still in receipt of a pension at the full general rate. Section 37 of the Act was repealed by the Amendment Act. Section 40 of the Amendment Act provides, for present purposes:

"40. (1) In this section, "review", in relation to a pension, means a review conducted under section 31 of the Repatriation Act 1920 for the purposes of --

(a) assessing the nature, and probable duration, of the incapacity in respect of which the pension is payable; and

(b) assessing the appropriate rate of that pension having regard to --

(i) the assessment referred to in paragraph (a);

(ii) any relevant provisions of the Repatriation Acts in force at the time of the review; and

(iii) the provisions of this Part.

(2) The Repatriation Commission shall, as soon as practicable after the commencement of this Part, conduct a review with respect to every pension payable in respect of incapacity caused by pulmonary tuberculosis, being a pension that has been so payable since before the commencement of this Part.

(3) Where a pension is the subject of a review in accordance with sub-section (2), the incapacity (if any) in respect of which the pension is payable shall, for the purposes of that review and thereafter for all purposes of the Repatriation Acts, be treated as if it had resulted from an occurrence that happened during the war service or special service of the member of the Forces concerned.

(4) The Repatriation Commission shall not, on the completion of a review with respect to a pension in accordance with sub-section (2), and a determining Authority shall not, at any time after the completion of that review under sub-section (2), determine the rate of the pension to be a rate less than --

(a) where the pension is payable to a member of the Forces - the rate of $74.40 per fortnight; or . . . . . . . . . . . . . . . . . . . . . . ".

Pursuant to the provisions of s.40, the Repatriation Commission, on 2 July, 1979, reviewed Mr. Moss' assessment for pension purposes and determined:

"Incapacity resulting from pulmonary tuberculosis is assessed as negligible with effect from 2.11.78. Incapacity from sensori-neural deafness left ear twenty percent, incapacity from conductive deafness left ear twenty percent, composite assessment for deafness is forty percent with effect from 27 April 1978. Pension continued at one hundred per cent Class 'A' from 27.4.78 and at the 'frozen rate' with effect from 2.11.78 Review indefinite".

Subsequently, the matter came on for review by the Repatriation Review Tribunal and, at the request of the representative for Mr. Moss, the President of the Repatriation Review Tribunal referred the matter to the Tribunal pursuant to s.107VZZB of the Act.

As has been mentioned, the Tribunal accepted medical evidence to the effect that Mr. Moss' tuberculosis was healed and inactive. It was satisfied beyond reasonable doubt that there was no existing appreciable physical incapacity resulting from it. In the Tribunal's view however, that did not conclude the case. The Tribunal considered that Mr. Moss' present employability was impaired and diminshed as a consequence of the pulmonary tuberculosis which he had previously suffered. It held that that impairment and diminution constituted a partial incapacity for relevant purposes. The Tribunal's findings in those regards are conveniently summarized in the following four extracts from its Reasons for Decision which are quoted in a different order to that in which they appear in those Reasons:

"The evidence concerning tuberculosis does not disclose any present incapacity other than a limitation upon his ability to earn income". "On the evidence, therefore, we are satisfied beyond reasonable doubt that Mr. Moss is not presently suffering from any physical or mental condition related to his tuberculosis which is limiting his activity or affecting his health". "In the present case, we are satisfied that the tuberculosis materially reduced the applicant's ability to obtain employment in the field of work to which he was most suited. In our opinion, the tuberculosis had, in this respect, a permanent effect upon him which presently affects his earning capacity. This is not a simple case of a lost opportunity, that is to say, that he was unable to take a particular job at a particular time because he was in hospital. It is a case where, because of his tuberculosis, he was precluded from continuing in the type of work to which he was most suited, that is to say, some form of outdoor or semi-outdoor work in which he could ultimately develop to foreman or executive status. We think that that limitation upon him is an incapacity for which an assessment is justified". "In our opinion, when s.40(2) of the Repatriation Acts Amendment Act 1978 speaks of "incapacity caused by pulmonary tuberculosis" it speaks of an incapacity which at least includes, even if it be not limited to, an incapacity for work resulting from pulmonary tuberculosis. In our opinion, in assessing such incapacity one may compare the talents which the serviceman would have had but for the tuberculosis with the talents to which he was restricted by reason of the tuberculosis. In our view, a limitation imposed upon a person's employment capacity by tuberculosis is both a relevant matter to which weight should be given and, if established, an "incapacity caused by pulmonary tuberculosis".

The Tribunal went on to conclude that the appropriate assessment of Mr. Moss' incapacity caused by his pulmonary tuberculosis was 30% of the general rate. Combined with the assessment of 40% of the general rate in respect of deafness, the result was that Mr. Moss was entitled to a pension at a higher percentage of the general rate than either of those figures. The Tribunal assumed, without finally deciding, that the appropriate higher percentage was that determined by the addition of the two figures, namely 70% Since 70% of the general rate is less than the minimum $74.40 per fortnight fixed by s.40(4)(a) of the Amendment Act, the immediate consequence of the Tribunal's finding would be that Mr. Moss remained entitled to a pension at the "frozen rate" which the Repatriation Commission had allowed him in its assessment. From Mr. Moss' point of view, the practical importance of the Tribunal's finding is that his pension will, if that finding stands, increase when 70% of the general rate exceed the frozen rate.

The function which the Repatriation Commission is required to perform by s.40 of the Amendment Act is a "review" under s.31 of the Act for the purposes of: (a) "assessing the nature, and probable duration, of the incapacity in respect of which the pension is payable" (s.40(1)(a)); and (b) "assessing the appropriate rate of that pension" (s.40(1)(b)). No express mention is made, in s.40, of that review involving an assessment of the "extent" of the incapacity: cf. s.27(1)(a) of the Act. While only pensions "payable in respect of incapacity caused by pulmonary tuberculosis" are required to be reviewed under s.40, the assessment of the nature of the incapacity in respect of which the pension is payable may reveal that the pension should properly be regarded as payable in respect of overall incapacity constituted by more than one type of particular incapacity: for example, as suggested in the present case, partial deafness and incapacity said to result from pulmonary tuberculosis. The assessment of "probable duration" of incapacity will be, at least primarily, concerned with whether the incapacity is past, temporary or permanent, those being matters which may affect the rate of pension, as will be seen when attention is directed to the provisions of the Act.

The assessment of the appropriate rate of pension as required by s.40(1)(b) is to be made "having regard to" the matters specified in sub-paragraphs (i), (ii) and (iii) of that paragraph. Sub-paragraph (i) requires that regard be had to the assessment made under paragraph (a) (see above). As to sub-paragraph (iii), the only "provisions of this Part" which seem significant for present purposes, i.e. other than sub-sections (1) and (2) of s.40, are the reference in sub-section (3) to "incapacity (if any)" which supports the conclusion that, on the review, a finding of no subsisting incapacity is open and the provisions of sub-section (4) which specify the minimum rate of pension immediately payable. It is therefore necessary, pursuant to sub-paragraph (ii), to found any determination of an appropriate rate in excess of the specified minimum rate, upon any "relevant provisions of the . . . Acts in force at the time of the review", i.e. provisions pursuant to which a pension may be payable "in respect of incapacity caused by pulmonary tuberculosis". As has been mentioned, the section of the Principal Act previously making special provision with respect to the subject (s.37) was repealed by the same Amendment Act as contains s.40. One must therefore turn to the general legislative provisions with respect to entitlement to, and the assessment of the appropriate rate of, a pension.

Basic to a claim for a pension under the general provisions of the Act is "the death or incapacity" of the claimant - see ss.24 (relating to World War I members) and 101 (relating to World War II members), both of which sections are contained in Part III of the Act, "PENSIONS". For present purposes, the relevant operative provisions are found in s.101(1) and are to the effect that, subject to certain immaterial exceptions, the Commonwealth is liable to pay pensions upon the incapacity or death of any member "whose incapacity or death has arisen out of or is attributable to his war service".

Throughout Part III, there is a consistent association between "incapacity" and "death": see, e.g., ss.24, 27, 42, 44 and 101 and the Schedules. The phrase "incapacity or death" appeared in the now repealed s.37 which, as elsewhere stated, made special provision as to the rate of a pension payable in respect of incapacity or death from pulmonary tuberculosis; it again appears in Part VII of the Amendment Act which contains the provisions dealing with the review of pensions payable in respect of incapacity or death caused by pulmonary tuberculosis: see, e.g., ss.38 and 39. This link between an "incapacity" and "death" is continued and emphasised by other provisions in Part III of the Principal Act, e.g. ss.24(2)(a), 27(1) and 48(1) which deal with deaths caused by incapacity. Other provisions, such as s.38(b), refer to incapacity as something which is suffered. The word "incapacity" is not completely defined but, unless the contrary intention appears, "includes incapacity . . . that arose from disease, not due to the serious default of, the member, contacted by him while employed on war service" (s.23, underlining added).

Section 27 of the Act charges Repatriation Boards appointed under the Act with various duties including the determination of the circumstances giving rise to "the incapacity from which a (claimant for a pension) is suffering or from which he has died" and also "in the case of incapacity the nature and extent thereof": see s.27(1)(a). The Boards must also determine whether a claimant is "permanently unemployable" (s.27(1)(j)), a term defined in s.23 to mean, unless the contrary intention appears, "permanently incapable, by reason of physical or mental disablement, of being employed. . . ". Section 48(1) requires a medical practitioner in reporting on any claim to set out in his report his opinion -

"(a) in the case of a claim in respect of . . . dealth . . . - as to the cause of the death; and

(b) in the case of a claim in respect of . . . incapacity . . . - as to the nature, cause and extent of incapacity,"

and also to set out his opinion in respect of whether the incapacity "from which the member is suffering or from which he has died" arose in circumstances entitling the claimant to a pension. Another duty committed by the statute to Repatriation Boards is that of "assessing, from time to time, the rates of pensions . . . ": s.27(1)(d). Speaking generally, the rates of pension are those specified in the Schedules to the Act: see s.35.

The Schedules proceed on the premises that there are degrees of an undefined condition referred to as "Total Incapacity" and that the condition may and perhaps often will exist although the person entitled to the pension is able to engage in a remunerative occupation and earn a living wage. The basic rate of pension for total incapacity is that specified in Schedule 1 Column 3. Clause 6 of Schedule 1 provides for a rate substantially higher than the basic rate "Where the incapacity . . . is such that he is unable to earn a living wage by reason that he is unable to engage in a remunerative occupation except on a part-time basis or intermittently". The basic rate of pension which is payable under Schedule 1 Column 3 to a person entitled to a pension "upon his Total Incapacity", or "on Total Incapacity", may also be increased under Schedule 1 Clause 3 if the person entitled to the pension is "temporarily totally incapacitated to such an extent as to be precluded from earning other than a negligible percentage of a living wage while he is so incapacitated . . . ". Schedule 2 provides a "Special Pension" rate (the Special Rate) for, inter alios, those in such a condition permanently, i.e. those "who are totally and permanently incapacitated (i.e. incapacitated for life to such an extent as to be precluded from earning other than a negligible percentage of a living wage)" (underlining added in each case).

Schedule 3 Table C is expressed to relate to pensions payable "IN CASES OF PARTIAL OR SPECIFIC INCAPACITY". It provides, in effect, that the rate of pension payable in such cases is such rate, being less than the General Rate and Special Rate, "as is assessed, having regard to the nature and probable duration of the incapacity, or in accordance with Schedules 4 and 5 in the cases to which those schedules apply". The terms General Rate and Special Rate are related back respectively to Schedule 1 Column 3 and to Schedule 2.

Schedule 4 provides that the rate of pension payable to a person entitled to a pension "who is incapacitated by reason of a disability specified in the first column of this Schedule is a rate equal to such percentage of the General Rate of pension to which (he) would be entitled under Schedule 3 if he were totally incapacitated as is set out in the second column of this Schedule opposite to the description of the disability". There follows a table containing two columns - one column is headed "Description of Disability" and contains items such as "Loss of two or more limbs", and the other column is headed "Percentage of General Rate" and contains percentages ranging from 100 to 50 depending upon the disability described. Schedule 5 takes matters a step further. It provides that where a person entitled to a pension "is suffering from a disability described in Column 1 of the following table, the amount and the rate of allowance (if any) specified in relation to that disability, in Columns 2 and 3 respectively, of the Table shall, subject to this Act, be payable in addition to the pension payable under Schedule 4". Then follows a table containing under the same heading, "Description of Disability", many of the items dealt with in Schedule 4 and, in further columns, the additional amounts and allowances to be paid under Schedule 5. None of the disabilities specified in Columns 1 of Schedules 4 and 5 is present in the instant case.

It emerges from the above that, if Mr. Moss is entitled, under the general provisions of the Act, to receive pension payments in respect of the consequences of his past pulmonary tuberculosis, it is pursuant to s.101(1) and Schedule 3 Table C. Any such entitlement depends upon whether he can be said, by reason of those consequences, to have an "incapacity" for the purposes of the operative general provisions of the Act being a "partial or specific incapacity" for the purposes of Table C.

Consideration of the relevant provisions of the Act leads, in our view, to the conclusion that, in a general sense, the word "incapacity", as used in the Act generally and s.101 and Schedule 3 Table C in particular, refers to a physical or mental disability or impairment rather than inability to work or earn. The consistent references to a person "suffering" an incapacity, the references to an incapacity "from which" a person "has died", the consistent link, as alternatives, between "incapacity" and "death", the terms of the partial definition of incapacity in s.23 as including "incapacity that arose from disease" and the policy underlying the Schedules of paying an increased pension over that payable in respect of "total incapacity" in the event that the incapacitated person is unable to earn other than a negligible percentage of a living wage all point to that conclusion. That conclusion conforms with what was said by the Full Court of this Court (Bowen C.J., Deane and Lockhart JJ.) in Repatriation Commission v. Bowman (judgment delivered 25 November, 1981, as yet unreported). It also accords with the reasoning of Ellicott J. at first instance in Bowman's Case ((1981) 34 A.L.R. 556) and of Fisher J. in Collins v. Repatriation Commission ((1980) 32 A.L.R. 581 at p.583). On the other hand, our conclusion in that regard does not accord with the approach adopted in the present case by the Tribunal: it should be mentioned that the Tribunal's Reasons for Decision were published before the Full Court's judgment in Bowman's Case.

In Bowman's Case (supra), the Full Court was concerned, inter alia, with whether Ellicott J. had been correct in treating cases on workers' compensation legislation as relevant to determining whether an applicant for pension was, for the purposes of Schedule 1 Clause 3, temporally totally incapacitated "to such an extent as to be precluded from earning other than a negligible percentage of a living wage" or had, for the purposes of Schedule 1 Clause 6, such an incapacity that he was "unable to earn a living wage by reason that he (was) unable to engage in a remunerative occupation except on a part-time basis or intermittently". The Court concluded that Ellicott J. was correct in his use of those cases. In so holding however, the Court expressly recognized a basic distinction between a pension for incapacity under the general provisions of the Act and compensation under workers' compensation legislation. Their Honours said:

"It is true, as Counsel for the Commission submitted, that the disability pensions dealt with in Schedules 1 and 2 are concerned with compensating for war related injury whereas the workers' compensation legislation is concerned to compensate for loss of earning capacity. The point is that the Schedules adopt loss of earning capacity (one way or another) as the measure of the extent of the war related disability. It is in relation to this aspect, that is to say, using loss of earning capacity to measure the extent of disability, that the workers' compensation cases may be regarded as furnishing some guidance".

At an earlier stage in the joint judgment in Bowman's Case (supra), the Full Court had referred to the "definition" of "incapacity" as including incapacity "that arose from disease" and said:

"Although not itself conclusive of the question, the definition supports the view, which is reinforced by the Act as a whole and the Schedules, that the word "incapacity" means a physical or mental disability rather than an inability to work or earn wages. This is the view expressed by Fisher J. in Collins v. Repatriation Commission (1980) 32 A.L.R. 581 at p.583 and by Ellicott J. in the present case. We agree with it".

The judgment in Bowman's Case (supra) did not, however, purport to establish, for the purposes of the Act, a clear dichotomy between physical or mental impairment on the one hand and inability to work or earn on the other. To the contrary, it was recognized in that case that inability to work or to earn will commonly be a manifestation and a measure of incapacity. While there are parts of the Schedules (Schedules 4 and 5) in which ability to work or to earn is necessarily irrelevant, there are other parts (Clauses 3 and 6 of Schedule 1 and Schedule 2) where a particular degree of inability to work and earn is given special significance. The latter type of provision was involved in Bowman's Case (supra) and, as has been seen, the basis of the Full Court's acceptance of the relevance of decisions on workers' compensation legislation was that they furnished some guidance on the aspect of using loss of ability to earn to measure the extent of disability.

It would be wrong to attempt to impose a logic and symmetry upon a legislative scheme the real explanations for which are historical and political. It would be a mistake either to assume that it will always be possible to draw a clear distinction between physical and mental disabilities on the one hand and inability to work and earn on the other or to seek to establish any formularized definitive test for drawing that distinction by reference to concepts such as immediate, inherent, consequential and symptomatic. Equally, any temptation towards attempting to frame a comprehensive judicial definition of what the statute has left largely undefined is to be resisted. The judicial gloss of such a general test or comprehensive definition would afford no true substitute for the statutory test and where, as here, the problem is largely semantic, the formulation of such a test or definition would, in our view, be likely to add to the burden as the words of the formulation fall for interpretation. The question whether there is a relevant incapacity, in the sense of physical or mental impairment or disability, must in each case be decided by reference to the particular specific features and considerations which the case presents. In answering that question, diminution of earning ability will frequently, perhaps commonly, be a manifestation and a measure of such incapacity: it is however neither a prerequisite nor a hallmark of its existence.

The effect of the Tribunal's findings of fact in the present case may be shortly restated. Mr. Moss did not at the date of the review have pulmonary tuberculosis or any physical or mental disability related to the pulmonary tuberculosis which he had earlier suffered; his health was no longer affected and no longer imposed any restriction upon his activities. However, in consequence of his earlier pulmonary tuberculosis, he was disadvantaged with respect to his employment and employability: he lacked skills, experience, a work position, job opportunities, and a higher level of income both in the present and for the future, which, but for his war service and the consequential pulminary tuberculosis, he would have possessed. He was missing such capabilities and opportunities not because he had lost them during or by reason of his previous illness but because that illness had deprived him of the opportunity to acquire or pursue them. It is not, for example, a case where an underlying and persisting loss of confidence or mental facility is resulting in diminished earning ability. It is a case where earning ability was not enhanced by reason of the fact that a disability or condition, which is now cured and inoperative, prevented, while it existed and was operative, the acquisition of skills, experience and seniority and the pursuit of a particular class of work.

The conclusion which we have reached, on the facts as found by the Tribunal, is that the disadvantages and lack of skills and abilities to which Mr. Moss is presently subject cannot properly be seen as an incapacity for the purposes of the Act. They represent the consequences of a past incapacity which no longer exists. They do not constitute a present incapacity in the relevant sense. It was not disputed, on Mr. Moss' behalf, that the consequence of that conclusion is that the decision of the Repatriation Commission should be restored.

We would allow the appeal, set aside the decision of the Tribunal and, in lieu thereof, order that the decision of the Repatriation Commission be restored. The applicant suggested that, in that event, each party should pay its or his own costs. We consider that such an order should be made. We also consider, if application be made in that regard, that the respondent should have a certificate pursuant to s.6 of the Federal Proceedings (Costs) Act, 1981 in respect of his costs of the appeal.