Shatzman and Repatriation Commission

[2009] AATA 823

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 823

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2008/2591

GENERAL ADMINISTRATIVE  DIVISION		)
Re		STEPHEN SHATZMAN

Applicant

And REPATRIATION COMMISSION

Respondent

INTERIM DECISION

Tribunal Professor RM Creyke, Senior Member
Dr MD Miller AO, Member

Date26 October 2009

PlaceCanberra

Decision If it is established that the applicant’s war-caused injury or disease prevented him from undertaking work as an IT technician, he would meet the qualifications in s 24(1)(b) and (c) for pension at the special rate.   

.................[sgd]........................

Professor RM Creyke, Senior Member

CATCHWORDS

VETERANS’ ENTITLEMENTS – s 24(1)(c) – remunerative work that the veteran was undertaking – whether veteran prevented from continuing to undertake that work because of a war-caused injury or war-caused disease – whether the remunerative work must be the last work that the veteran undertook – whether the veteran would have been undertaking that work on the assessment day but for the war-caused injury or disease – whether there must be a total inability to undertake the remunerative work at the assessment day – whether the remunerative work can be the same work as previous remunerative work but undertaken for a period of no more than 8 hours a week

Veterans’ Entitlements Act 1986 – ss 15, 24(1)(b), 24(1)(c)

Flentjar v Repatriation Commission (1997) 48 ALD 1

Repatriation Commission v Alexander (2003) 75 ALD 329

Banovich v Repatriation Commission (1986) 69 ALR 395

Starcevich v Repatriation Commission (1987) 18 FCR 221

Repatriation Commission v Hendy (2002) 76 ALD 47

Re Holden and Repatriation Commission [2009] AATA 735

Birtles v Repatriation Commission (1991) 33 FCR 290

Repatriation Commission v Butcher [2006] FCA 811

Repatriation Commission v Butcher [2007] FCAFC 36

Doig v Repatriation Commission (unreported, Federal Court of Australian, Lindgren J, 18 December 1996)

Sheehy v Repatriation Commission (1996) 41 ALD 205

Re Hornery and Repatriation Commission (1998) 52 ALD 317

Fry v Repatriation Commission (1997) 47 ALD 776

Wright v Repatriation Commission (2005) 144 FCR 302

Servos v Repatriation Commission (1995) 129 ALR 509

REASONS FOR INTERIM DECISION

26 October 2009 Professor RM Creyke, Senior Member
Dr MD Miller AO, Member

BACKGROUND

1.        Mr Shatzman has applied to the Tribunal for review of the Repatriation Commission’s decision of 18 October 2007 to refuse an increase in his disability pension. The reviewable decision was affirmed by the Veterans’ Review Board on 14 May 2008.

ISSUES

1.      The parties have sought an interim decision on two issues:

(a)  What was the ‘remunerative work that the veteran was undertaking’ for the purposes of s 24(1)(c) of the Veterans’ Entitlements Act 1986 (Act)?; and

(b) Was the veteran ‘prevented from continuing to undertake’ that work because of a war-caused injury or war-caused disease?

2.      Subsidiary issues are:

(a)      Whether the remunerative work must be the last work that the          veteran undertook;

(b)      Whether the veteran would have been undertaking that work on the assessment day but for the war-caused injury or disease;

(c)      Whether there must be a total inability to undertake the          remunerative work at the assessment day; and

(d)      If the veteran does not have to establish that there is a total inability to undertake remunerative work, whether the remunerative work can be the same work as previous remunerative work but undertaken for a period of no more than 8 hours a week.

3.      Initially, the representative for the applicant conceded that if the veteran was still engaged in remunerative work of the same general kind as previously undertaken, although for less than 8 hours a week, the veteran would not qualify for special rate pension. That concession was withdrawn prior to consideration of this interlocutory decision.

4.       The parties have provided the Tribunal with extensive and helpful submissions on the issues.  

LEGISLATION

5.      The relevant terms of section 24 of the Act are:

Special rate of pension

(1) This section applies to a veteran if:  

…

(b)  the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war‑caused injury or war‑caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and

(c)  the veteran is, by reason of incapacity from that war‑caused injury or war‑caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity; …

6.      In their submissions, the parties have referred to a number of cases which principally relate to s 24(2A) of the Act.  That provision was introduced in 1994 in response to concerns about claims by older veterans for pension at the special rate. From 1994, the new s 24(2A) provided that it was only those veterans who clearly had an intention to work beyond 65, an intention which was frustrated by war or defence-caused injury or disease, who would qualify for pension at the special rate. 

7.      To implement this intention, a veteran had to establish that the veteran was undertaking remunerative work after age 65, that the person's war-caused incapacity prevented the person from continuing to undertake that work, and that the veteran had been undertaking 'such work' for at least 10 years prior to the application. In particular the reference to 'remunerative work' was to the 'last paid' work that the veteran had undertaken.  Neither of these last two requirements applies to s 24(1)(c).

8.      For these reasons, cases which discuss what is the relevant remunerative work for the purpose of s 24(2A) are not pertinent to the discussion of 'remunerative work' in the context of s 24(1)(c).[1]  Nor, are they relevant to the circumstances of Mr Shatzman, who is not yet 65.

[1] For example, Repatriation Commission v Haskard (2002) 126 FCR 1; Carter v Repatriation Commission (2001) 113 FCR 314.

APPROACH TO APPLICATION OF S 24(1)(C)

9.      The approach to be adopted in applying s 24(1)(c) was considered in Flentjar v Repatriation Commission (1997) 48 ALD 1. Branson J (with whom Beaumont and Merkel JJ agreed) identified the issues to be addressed when applying s 24(1)(c) as:

a. What was the relevant ‘remunerative work that the veteran was undertaking’ within the meaning of s 24(1)(c) of the Act?

b.   Was the veteran by reason of war-caused injury or war-caused disease, or both, prevented from continuing to undertake that work?

Issue 1 – What was the ‘remunerative work that the veteran was undertaking’?

10.     Subsection 5Q(1) of the Act defines ‘remunerative work’ expansively to include ‘any remunerative activity’.  However, there is no uniform meaning of ‘remunerative work’ in the Act. The expression has different meanings according to the context even within section 24. As Spender J said in Repatriation Commission v Alexander (2003) 75 ALD 329 at 332, s 24(1)(b) ‘addresses the extent of the veteran’s war-caused incapacity’ which prevents the veteran working, while the context of s 24(1)(c) ‘is directed at quite a different question, causation’.

11.     It is well established that ‘remunerative work that the veteran was undertaking’ in s 24(1)(c) does not refer to the particular job that the person was doing, but to the type of work that the veteran had previously undertaken.[2] As the Full Federal Court put it in Repatriation Commission v Hendy:[3]

The requirement to consider “remunerative work that the veteran was undertaking” does not mean a particular job with a particular employer but the substantive remunerative work that the veteran had undertaken in the past.

[2] Banovich v Repatriation Commission (1986) 69 ALR 395 at 402; Starcevich v Repatriation Commission (1987) 18 FCR 221 at 225; Repatriation Commission v Hendy (2002) 76 ALD 47 at [36].

[3] Repatriation Commission v Hendy (2002) 76 ALD 47 at 54.

12.     The finding that ‘remunerative work’ refers to a broad field of activity rather than a specific profession or job meant,  for example, in Re Holden and Repatriation Commission [2009] AATA 735 that remunerative work as a station assistant with the State Rail Authority; as a head mill-operator with Comalco; as a forklift driver, a storeman, and a picker and packer; as a security officer; as a handyman and gardener; as a trades assistant to an electrical firm; and as a cargo specialist for loading and unloading of vehicles, was classified simply as ‘general unskilled work with some element of physical activity’: at [13].[4] It was conceded, however, that a broad characterisation of this kind is easier where the person has performed a range of unskilled jobs and will not always be appropriate.

[4] See too Birtles v Repatriation Commission (1991) 33 FCR 290 at 299-300; Repatriation Commission v Butcher [2006] FCA 811.

13.     In Repatriation Commissionv Butcher [2006] FCA 811, Besanko J said that the characterisation of the type of remunerative work, like the test for causation, must ‘be made with an eye to reality, and as a matter in respect of which common sense is the proper guide’.[5] This broad approach to characterisation of what is ‘remunerative work’ was upheld on appeal by the Full Court,[6] and has been accepted by both parties to this application. 

[5] Repatriation Commission v Butcher [2006] FCA 811 at [43].

[6] Repatriation Commission v Butcher [2007] FCAFC 36 at [17].

14.     The 'remunerative work' must be 'substantive' remunerative work that the veteran has undertaken in the past,[7] which the veteran was capable of undertaking.[8]

[7] Repatriation Commission v Hendy (2002) 76 ALD 47 at [36]; Starcevich v Repatriation Commission (1987) 18 FCR 221 at 225 per Fox J.

[8] Doig v Repatriation Commission (unreported, Federal Court of Australian, Lindgren J, 18 December 1996).

15.     Applying these findings to Mr Shatzman, post service his remunerative work can be broadly characterised first as an information technology technician and, from January 2006, when he was no longer fit for that work, as administrative, non key-boarding work.  Both kinds of work are substantive in nature.  He undertook the administrative work part-time in the Australian Taxation Office for 6 hours a week from 20 October 2006.

Issue 2 – Was the applicant prevented from continuing to undertake that work because of a war-caused injury or war-caused disease?

16.     Analysis of this issue requires consideration of:

·Whether the remunerative work must be the last work that the          veteran undertook;

·Whether the veteran would have been undertaking that work on the assessment day but for the war-caused injury or disease;

·Whether there must be a total inability to undertake the          remunerative work at the assessment day or is there a minimum threshold of hours of work to be read into s 24(1)(c); and

·If the veteran does not have to establish that there is a total inability to undertake remunerative work, whether the remunerative work can be the same work as previous remunerative work but undertaken for a period less than 8 hours a week.

Whether the remunerative work must be the last work that the veteran undertook

17.     Responding to this question requires consideration of the meaning of ‘was undertaking’ in s 24(1)(c).  Section 24(1)(c) does not define the time frame to be considered.  The submission for Mr Shatzman posed three possibilities.  The work must be the remunerative work that the veteran was undertaking:

·   immediately prior to making an application for special rate, that is, the beginning of the 'assessment period';[9] 

·   At any time during the assessment period; or

·   At any time in the applicant's past working life.

[9] Veterans’  Entitlements Act 1986 s 15.

18.     A long line of authority has concluded that the remunerative work need not be the last work that the veteran undertook.[10] The authorities are represented by the statement of the Full Court in Repatriation Commission v Hendy, that ‘[t]he Tribunal was not bound to limit its consideration to the last employment that the Veteran actually undertook’.[11]

[10] Starcevich v Repatriation Commission (1987) 76 ALR 449 at 454 per Fox J; at 455-456 per Jenkinson J; Neaves J dissenting; Sheehy v Repatriation Commission (1996) 41 ALD 205 at 210 (Full Court); Re Hornery and Repatriation Commission (1998) 52 ALD 317.

[11] Repatriation Commission v Hendy (2002) 76 ALD 47 at [36].

19.     The Repatriation Commission conceded in its submission that the 'remunerative work' need not be the last remunerative work that the veteran was undertaking. It is preferable and consistent with the cases and I so find that the relevant remunerative work is work which 'was undertaken' at any time in the veteran's past working life.

20.     On that basis, the remunerative work which must be considered in relation to Mr Shatzman is both his work as an IT technician and his administrative non key-boarding work. Both have been substantive remunerative work which he has undertaken.

Whether the veteran would have been undertaking that work on the assessment day but for the war-caused injury or disease

21.     The Commission suggested that the remunerative work must be work that the veteran would have been undertaking at the relevant time in the assessment period had the veteran not been incapacitated from doing so by war-caused disabilities. 

22.     In other words, the veteran must be able to establish that but for the war-caused injury or disease the veteran would still be undertaking remunerative work at the time of the application for pension at the special rate: Starcevich v RepatriationCommission (1987) 18 FCR 221; Fry v Repatriation Commission (1997) 47 ALD 776 at p 7 of the transcript of the judgment. See also 13 VeRBosity 82.

23.     When there is more than one type of substantive remunerative work which the veteran has been prevented from undertaking during their working life such a finding requires that the veteran must establish that but for the war-caused disease/injury, the person would have continued to undertake at least one of those kinds of remunerative work during the assessment period.

24.     In Mr Shatzman’s case, potentially this requires examination of both his IT technician work as well as his administrative non-keyboarding work.  However, as the reasons relating to the next sub-heading indicate, his administrative non-keyboarding work can be discounted since he was not undertaking such work for more than 8 hours a week.

Whether there must be a total inability to undertake the remunerative work at the assessment day or is there a minimum threshold of hours of work to be read into s 24(1)(c)?

25.     The Repatriation Commission submitted that s 24(1)(c) contained no reference to a minimum threshold of hours of remunerative work. The submission contrasted this with the requirement found in s 24(1)(b) that an applicant, solely because of war-caused injury or disease, must be incapable of working more than eight hours a week in any field. The submission concluded that the omission of any reference to hours in s 24(1)(c) must, therefore, have been intentional.

26.     This conclusion, it was submitted, was reinforced by the requirement in s 24(1)(c) that by reason of war-caused injury or disease the veteran must be 'prevented' from continuing to undertake remunerative work. These arguments indicated that no minimum threshold of hours should be read into s 24(1)(c).

27.     To so conclude is to ignore the structure of s 24.  Each paragraph setting out the separate criterion for eligibility for special rate pension is separated by 'and'.  That means the criteria are cumulative.  A reference to the minimum threshold of hours in s 24(1)(b) does not need to be included in s 24(1)(c) since the minimum threshold of 8 hours appears in s 24(1)(b).  That means the 8 hour requirement should be read into s 24(1)(c):  Wright v Repatriation Commission (2005) 144 FCR 302; Servos v Repatriation Commission (1995) 129 ALR 509.

28.     That means also that the submission for the Repatriation Commission is rejected.  The work which Mr Shatzman was undertaking at the Australian Taxation Office could be considered.  That means that the remunerative work that the veteran was undertaking could include his work as an IT technician or his administrative, non key-boarding work.

29.     However, since the administrative, non key-boarding work was not being undertaken for more than 8 hours a week, it can be discounted. On that basis, the relevant work for consideration in this application is solely Mr Shatzman's work as an IT technician.  In the present case, it appears that Mr Shatzman would have remained employed as an IT technician but for the effects of his defence-caused disabilities.

If the veteran does not have to establish that there is a total inability to undertake remunerative work, whether the remunerative work can be the same work as previous remunerative work but undertaken for a period less than 8 hours a week.

30.     In the submissions on behalf of the respondent, it was conceded that 'if the Tribunal determines that the applicant is presently engaged in a field of endeavour that is different from that field of endeavour previously undertaken by the applicant, then the respondent concedes that the applicant is prevented, by reason of defence-caused injury or defence-caused disease, or both, from continuing to undertake his previous field of endeavour.  This would therefore satisfy the second question in Flentjar v Repatriation Commission'. 

31.     Given this concession, and the fact that Mr Shatzman's work as an IT technician is different from his administrative, non-keyboarding work, there is no need to consider whether if the remunerative work Mr Shatzman was undertaking at the assessment time for less than 8 hours a week was as an IT technician, his claim for special pension would have been disallowed. 

32.     The Tribunal notes, however, the view of Fox J in the majority in Banovich that:

[A] veteran’s entitlement to a pension under s 24 may be based on his being prevented from continuing to undertake substantial remunerative work that he has undertaken in the past, even if that work was followed by work of a different type before the veteran ceased work altogether’. (Emphasis added.)[12]

[12] Starcevich  v Repatriation Commission (1987) 18 FCR 221at 225. See too the cases which discuss this issue in Re Mitchell and Repatriation Commission [2007] AATA 2087 at [65]-[70].

33.     The implication from this statement is that entitlement under s 24 could relate to remunerative work of the same or a different type. The Tribunal notes the concern expressed by the submissions for the Commission that eligibility for special rate pension should not be available to someone who simply reduced the amount of hours being worked in existing remunerative work in order to qualify.  Since on the facts this is not an issue which needs consideration, the Tribunal makes no findings on it.

34.     In principle, however, it is the Tribunal’s opinion that in a case in which a veteran’s war or defence-caused injury or disease necessitated reduction in hours to below the minimum threshold, but the work for up to 8 hours a week remained substantial, that eligibility should not be denied.

CONCLUSION

35.     If it is established that Mr Shatzman's war-caused injury or disease prevented him from undertaking work as an IT technician it is clear he would meet the qualifications in s 24(1)(b) and (c) for pension at the special rate. The Tribunal is grateful to the parties for their helpful submissions.

I certify that the 35 preceding paragraphs are a true copy of the reasons for the decision herein of Professor RM Creyke, Senior Member and
Dr MD Miller AO, Member.

Signed:         .....................................................................................
  Associate

Date of Interim Decision           26 October 2009
Counsel for the Applicant         Mr A Anforth
Solicitor for the Applicant          Mr P Crabb, Capital Lawyers
Solicitor for the Respondent     Mr B Topperwien, Repatriation Commission