Repatriation Commission v Nicholson, E.M

[1995] FCA 51

CATCHWORDS

VETERANS' AFFAIRS - appeal from Administrative Appeals Tribunal - question of law - construction of s. 120 of Veterans' Entitlements Act 1986 - whether failure by Tribunal to address legal issues presented by s. 120.

Veterans' Entitlements Act 1986, s. 120

Administrative Appeals Tribunal Act 1975, s. 44

Bushell v Repatriation Commission (1992) 175 CLR 408.
Byrnes v Repatriation Commission (1993) 177 CLR 564.
Nicholson v Repatriation Commission (1993) 29 ALD 663.
Nation v Repatriation Commission (Northrop J., 7 December 1994, unreported).

REPATRIATION COMMISSION v EVELYN MARY NICHOLSON

No. NG442 of 1994.

BEFORE:      GUMMOW J.
PLACE:       SYDNEY.
DATE:        17 FEBRUARY 1995.

IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )        No. NG442 of 1994
GENERAL DIVISION                 )

On appeal from the Veterans' Division of the Administrative Appeals Tribunal constituted by Senior Member M.D. Allen, Brigadier J.A. Hooper CBE and Dr J.D. Campbell Members.

BETWEEN:          REPATRIATION COMMISSION
  Appellant

AND:              EVELYN MARY NICHOLSON
  Respondent

BEFORE:      GUMMOW J.
PLACE:       SYDNEY.
DATE:        17 FEBRUARY 1995.

MINUTE OF ORDERS
THE COURT ORDERS THAT:

(1)The appeal be allowed.

(2)The decision of the Administrative Appeals Tribunal of 17 June 1994 be set aside.

(3)The matter be remitted to the AAT to be reheard in accordance with law.

(4)The respondent to pay the costs of the appellant in this Court.

Note: Settlement and entry of orders are dealt with by Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )        No. NG442 of 1994
GENERAL DIVISION                 )

On appeal from the Veterans' Division of the Administrative Appeals Tribunal constituted by Senior Member M.D. Allen, Brigadier J.A. Hooper CBE and Dr J.D. Campbell Members.

BETWEEN:          REPATRIATION COMMISSION
  Appellant

AND:              EVELYN MARY NICHOLSON
  Respondent

BEFORE:      GUMMOW J.
PLACE:       SYDNEY.
DATE:        17 FEBRUARY 1995.

REASONS FOR JUDGMENT
     The respondent is the widow of Mr H.W. Nicholson.  Mr Nicholson died at Manly District Hospital on 3 January 1989.  He had been born on 25 March 1918.  Between 11 November 1942 and 5 March 1946, Mr Nicholson had served in the Royal Australian Air Force; on eleven occasions he was a navigator on Lancaster bombers on missions over German occupied Europe.  Mrs Nicholson met her husband in the United Kingdom in October 1944.  They were married a year later and later settled in Australia, where he became a bank manager.

Sub-section 13 (1) of the Veterans' Entitlements Act 1986 ("the Act") provides that the Commonwealth is, subject to the Act, liable to pay pensions to dependants of the veteran, in accordance with the Act, where the death of the veteran was "war-caused". The death of a veteran shall be taken to have been war-caused if the death "arose out of, or was attributable to" any eligible war service rendered by the veteran: para. (1) (b).

This matter turns upon the provisions as to standard of proof in s. 120 of the Act. The construction of s. 120 has been analysed in detail by the High Court on two occasions, Bushell v Repatriation Commission (1992) 175 CLR 408 and Byrnes v Repatriation Commission (1993) 177 CLR 564. On 17 June 1994, the Administrative Appeals Tribunal ("the AAT") set aside a decision by a Veterans' Review Board which on 2 November 1990 had affirmed the decision of a Delegate of the appellant, ("the Commission"), rejecting the claim of Mrs Nicholson that the death of her husband should be attributed to his war service. In place of the decision under review, the AAT substituted a decision that the Commonwealth is liable pursuant to s. 13 of the Act to pay a pension to Mrs Nicholson with effect as and from 4 January 1989, the day after his death.

The appellant submits that the decision of the AAT is flawed by an error of law, so as to attract the jurisdiction of this Court under s. 44 of the Administrative Appeals Tribunal Act 1975 ("the AAT Act"). The error of law is said to lie in the misapplication by the AAT of s. 120 of the Act. It is also contended that the AAT erred, in failing to give reasons for its decision, contrary to s. 43 of the AAT Act.

This matter has a long history.  The decision of the AAT now under appeal was the sequel to the decision of Whitlam J., Nicholson v Repatriation Commission (1993) 29 ALD 663. On 23 March 1993, his Honour had ordered that an earlier decision of the AAT, given 3 June 1992, be set aside, and the matter be reheard by the AAT. Whitlam J. explained the significance of the reasoning in Bushell, which had been delivered on 7 October 1992.  On 15 September 1993, in the interval between the delivery of that judgment and the rehearing by the AAT on 24 March 1994, the High Court on 15 September 1993 had delivered judgment in Byrnes.  In the joint judgment of the Court in Byrnes, there is discussion of Bushell followed by a passage (177 CLR at 571) plainly designed as an authoritative statement for the guidance of bodies such as the AAT in the application of s. 120.

In its Reasons for Decision, delivered 17 June 1994, the AAT referred to Byrnes. The decision was then reported at (1993) 116 ALR 210. The AAT made special reference to passages at pp. 214 and 216 of that report. The crucial passage (now 177 CLR at 571) appeared 116 ALR at 215. No specific reference was made to it. The present litigation in this Court is an unfortunate consequence of what appears to be a failure to have clear regard to what the High Court had laid down.

This case is not an isolated example.  Another case where the decision of the AAT given after the judgment in Byrnes but which did not adopt the methodology laid down in Byrnes came before Northrop J. in Nation v Repatriation Commission (7 December 1994, unrep.).

The passage in Byrnes to which I have referred is as follows:

"The position may be summarized as follows: (1) First, sub-s. (3) of section 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 in 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."

The first step of which the High Court spoke thus requires application of sub-s. 120 (3) of the Act. This states, so far as presently relevant:

"120(3)  In applying subsection (1) or (2) in respect of the incapacity of a person from injury or disease, or in respect of the death of a person, related to service rendered by the person, the Commission, shall be satisfied, beyond reasonable doubt, that there is no sufficient ground for determining:

(a)...

(b)...

(c)that the death was war-caused or defence-caused;

as the case may be, if the Commission, after consideration of the whole of the material before it, is of the opinion that the material before it does not raise a reasonable hypothesis connecting the injury, disease or death with the circumstances of the particular service rendered by the person."

The second step requires application of sub-s. 120 (1).  This states, as presently material:

"120(1)  Where a claim under Part II for a pension in respect of the death of a veteran, relates to the operational or service rendered by the veteran, the Commission shall determine ... that the death of the veteran was war-caused ... unless it is satisfied, beyond reasonable doubt, that there is no sufficient ground for making that determination."

It will be noted that sub-s. 120 (3) refers not to consideration of "evidence", but of "the whole of the material".  The formation of the opinion referred to in sub-s. 120 (3) is not determined by application of the technical rules of evidence applicable to civil or criminal litigation; cf Mahon v Air New Zealand Ltd [1984] 1 A.C. 808 at 820-1.

In its Reasons of Decision dated 17 June 1994, the AAT after tracing the curial history of the matter, described (para. 7) the task before it as follows:

"As the Deceased had operational service pursuant to Sub-section 120 (1) and (3) of the Veterans' Entitlements Act 1986 the Tribunal shall determine that the death of the Deceased was war-caused unless it is satisfied, beyond reasonable doubt, that there is no sufficient ground for making that determination. The Tribunal shall, however, be deemed to be satisfied beyond reasonable doubt if, after a consideration of the whole of the material before it, it is of the opinion that the said material does not raise a reasonable hypothesis connecting the death of the Deceased with the circumstances of the particular service rendered by him."

It will be apparent that the first sentence of para. 7 reflects the terms of sub-s. 120 (1), and the second sentence those of sub-s. 120 (3).  Counsel for Mrs Nicholson relied upon this passage as an indication that whatever obscurity might otherwise appear in the concluding passages of the Reasons for Decision, this was an indication at the outset that the AAT had understood what was involved in the discharge of its task.  However, counsel for the Commission relied upon para. 7 for the contrary proposition.  He pointed out that a reading of the vital passage in Byrnes would stress to the reader that sub-s. (3) was applied first and that sub-s. (1) was applied only if a reasonable hypothesis was established, whereas para. 7 approached the matter rather in reverse order.

Whilst, as a general proposition, the Court certainly should not be concerned with mere looseness in the terms used by the AAT in reasons for decision, nor with unhappy phrasing of its thoughts (Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287) there is weight in the submissions for the Commission. The interrelation between sub-ss. (3) and (1) of s. 120 and the steps which are then required of the decision maker to give effect to the scheme of s. 120 are vital matters in a case such as the present.

The primary submission of the Commission, as developed in argument, is that whatever may be said of the finding as to the raising of a reasonable hypothesis within the meaning of sub-s. (3), the AAT fell into error by regarding its acceptance of the hypothesis relied upon as concluding the matter before it and in failing to go on to apply sub-s. (1).  It was further submitted that in failing to apply sub-s. (1), the AAT did not consider whether one or more of the facts necessary to support the hypothesis were disproved beyond reasonable doubt, or whether the truth of another fact in the material, inconsistent with the hypothesis, was proved beyond reasonable doubt.

In the Reasons for Decision, the AAT set out (in para. 2) material from the medical certificate of cause of death of Mr Nicholson prepared pursuant to the Registration of Births, Deaths and Marriages Act 1973 (NSW). That legislation is directed to very different objects to those of the statute with which this case is concerned. However, under the heading "Cause of Death" asthma was described as a significant condition contributing to the death but not related the disease or condition causing it. Cardiac respiratory failure was described as the disease or condition "directly leading to death", and acute myocardial infarction was identified as a morbid condition giving rise to the stated disease or condition directly leading to death.

Mr Nicholson had suffered from asthma for many years prior to his death. It was common ground that his asthma related to and was caused by "operational service" within the meaning of the Act. Hence the dispute before the AAT was concerned with the connection between Mr Nicholson's asthma and his death. The AAT noted (para. 9) that the hypothesis advanced for Mrs Nicholson in linking the death of her husband with his operational service was that the war-caused asthma materially contributed to or accelerated the condition directly leading to death, namely cardio-respiratory failure.

Oral testimony was given to the AAT by three medical practitioners, Dr Michael Hooper, Professor R.B. Blacket and Dr M.G. Miller.  The first two were called by the Commission and the third by Mrs Nicholson.  The medical practitioner who had completed the death certificate, Dr Anne Balcumb, was not called by either party.

After considering this material, the AAT concluded (para. 14):

"There is evidence that the Deceased did suffer moderately severe asthma and although the hospital notes contain no reference whatsoever to the Deceased having suffered an asthma attack whilst in hospital the possibility does remain open.  As Dr Miller stated in evidence on the first occasion the matter was before the Tribunal:

'I am led to the conclusion that they were so concerned with dealing with his heart condition, which was very severe and life threatening, that the asthma was put on secondary - it was regarded as being of secondary importance.'"

What appears in para. 14 is consistent with a finding that some of the facts raised by the material before the AAT gave rise to a reasonable hypothesis connecting the death of Mr Nicholson with his war service, within the meaning of sub-s. 120 (3).  The complaint of the Commission is that in its reasoning process the AAT then did not go on, as it was required to do, to consider whether the claim should succeed unless either or both of the matters summarised in paras. 2 (a) and (b) of the passage in Byrnes applied; that is to say, the Commission submitted that the AAT had not gone on to consider sub-s. 120 (1). 

After para. 14, the AAT set out (para. 15) a passage in the joint judgment in Bushell, 175 CLR 408 at 414 (the report before the AAT was 109 ALR 30 at 34). In this passage the High Court was explaining the operation of sub-s. 120 (3). The AAT continued (para. 16) by setting out a paragraph from one of its prior decisions and stated (para. 17) that this was consistent with what the High Court since had said in Byrnes.  However, as I have indicated, the passages in Byrnes to which the AAT stated it was making special reference were on either side of the crucial passage in which the High Court summarised the position.

There followed paras. 18, 19 and 20 in which the AAT summed up the position as it saw it before reaching (para. 21) the decision to set aside the decision under review, and in place thereof to substitute a decision favourable to Mrs Nicholson.

Paragraphs 18, 19 and 20 should be set out in full.  They are as follows:

"18Thus, although the Deceased's myocardial infarction was of itself fatal, there exists the reasonable hypothesis that the administration of morphine would have depressed the respiratory centre and, if an attack of asthma occurred, the depressed function of the respiratory centre would have accelerated his death.  That acceleration was at least only a matter of hours and in practical terms the cause of the Deceased's death was his heart disease.  Notwithstanding this as O'Loughlin J said in Doolette v Repatriation Commission 21 ALD 489 at 492:

'... the learned Deputy President pointed out, and I agree, that if death is hastened because of the accelerated progress of a disease, which acceleration was itself caused by a war-caused condition, the proper conclusion would be that death was attributable to war service; Re Blyth and Repatriation Commission (1982) 4 ALN N147.'

19.On this basis therefore the Tribunal is required to hold, however metaphysical it may appear given the evidence as to the Deceased's morbid state, that there does exist the reasonable hypothesis that war-caused asthma accelerated death.

20.The actual hypothesis which has been considered is that the administration of morphine depressed the function of the respiratory centre and accordingly its ability to respond to an attack of asthma.  Having accepted this hypothesis it is not necessary to rule on the other hypotheses contended for by the Applicant except that hypothesis regarding the effect of steroids which has been dismissed by the Applicant's own specialist witness.  Having accepted one of the remaining hypotheses, that is enough to vest liability in the Respondent."

Counsel for Mrs Nicholson submits that the statement in para. 20 that the AAT had "accepted" the hypothesis that the administration of morphine depressed the function of the respiratory centre and accordingly its ability to respond to an attack of asthma, went beyond performance of the task given it by sub-s. 120 (3) and is indicative of an assessment by the AAT of the positive strength of the evidence favouring entitlement.  It is said that upon proper analysis of its reasons, the AAT did go beyond sub-s. 120 (3) to weigh up the whole of the evidence and make an overall assessment that a favourable hypothesis had not been disproved.  Counsel contends that it was open to the AAT to "short cut" matters in this way, that the material before the AAT did not allow of any outcome on the application of sub-s. 120 (1) other than one favourable to Mrs Nicholson, that whilst the making of the overall assessment on the balance of probabilities rather than on the standard of disproof beyond reasonable doubt might be an error of law, it would be one which would not disadvantage the Commission.

Counsel for Mrs Nicholson submitted that the material before the AAT would not have allowed of any other outcome on the application of sub-s. 120 (1) other than one favourable to his client. On the other hand, when the matter was previously before this Court, Whitlam J., looking at the record as it then stood, said (29 ALD at 669):

"In my view, it would certainly have been open to the tribunal, had it come to consider the application of s. 120 (1), to be satisfied on the material before it that the raised facts were disproved beyond reasonable doubt."

Counsel for Mrs Nicholson urged the Court to hold that any defects in the reasons of the AAT be treated as formal or immaterial to the acceptance of her claim, and to decline to set aside the decision of the AAT, this being in the interests of justice: AAT Act, sub-s. 44 (4).

The contrary submissions, for the Commission, were that (a) had the AAT turned to consider the application of sub-s. 120 (1), it would have been necessary for it to consider whether one of the facts necessary to support the hypothesis, namely the occurrence of an asthma attack (not merely the existence of an asthma condition) was disproved beyond reasonable doubt, (b) there was no real indication that the AAT had engaged in any such exercise, (c) this is not an instance where the facts have been fully found or are undisputed (as in Collector of Customs, Tasmania v Flinders Island Community Association (1985) 7 FCR 205 at 214) and (d) the error of law was not one which could not have affected its decision; cf BTR PLC v Westinghouse Brake & Signal Company (Australia) Ltd (1992) 34 FCR 246 at 253-4.

These submissions for the Commission should be accepted.

In my view, there was a significant error of law in the approach taken by the AAT, and it would be wrong for the Court in an "appeal" under s. 44 of the AAT Act itself to venture upon the resolution of the questions presented by sub-s. 120 (1) in the light of the material before the AAT. The defects in the method adopted by the AAT in dealing with the matter before it cannot properly be described as formal or immaterial.

The appeal should be allowed and the decision of the AAT dated 17 June 1994 should be set aside.  The matter should be remitted to the AAT to be heard and decided again, and the respondent should pay the costs of the appellant in this Court.

Mr Nicholson died on 3 January 1989. Mrs Nicholson lodged her claim under the Act in respect of the death of her husband, on 11 January 1989. The matter still has to be brought to a conclusion.
Mrs Nicholson's counsel submitted that if the Court were to decide, as it has, that the matter must be sent back for further consideration by the AAT, no direction should be given that the AAT should be reconstituted. Rather, there should be a direction that the AAT be not reconstituted and that no further evidence be received. An important factor in the institution of the present appeal to this Court has been the understandable desire of the Commission to ensure the due application of s. 120 by the AAT. That goal should now have been achieved. There is much to be said for the view that it would be oppressive to Mrs Nicholson if the present lengthy delay in deciding her entitlement to pension were further protracted by her exposure to the risk of having to meet fresh material put forward against her at a third hearing.

Upon delivery of reasons for judgment I will make the orders set out above and stand the matter over for a short time to enable consideration by the parties and the presentation of any further submissions as to the addition to those orders of further directions of the nature sought by Mrs Nicholson.

I certify that this and the preceding thirteen (13) pages are a true copy of the reasons for judgment of the Honourable Mr Justice Gummow.

Associate:

Date:                  17 February 1995.

Counsel and solicitor       Mr Nicholas Green
     for the appellant:          instructed by
  Australian
  Government Solicitor.

Counsel and solicitors      Mr M.B. Smith
     for the respondent:         instructed by
  Vardanega Roberts.

Date of hearing:            7 February 1995.

Date of judgment:           17 February 1995.