Sommer v NM Superannuation Pty Ltd

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FEDERAL COURT OF AUSTRALIA

Sommer v NM Superannuation Pty Ltd [2001] FCA 923

SUPERANNUATION – appeal against decision of Superannuation Complaints Tribunal – total and permanent disability benefit claim – conflicting medical evidence – Tribunal deciding not by choosing between medical opinions but by reference to underlying facts – whether Tribunal erred in law

ADMINISTRATIVE LAW – natural justice – procedural fairness – Superannuation Complaints Tribunal receives Supplementary Submission from insurer – forwards copy to complainant’s solicitors advising that response not sought – Tribunal deciding against complainant – no new matter raised by Supplementary Submission – complainant unable to suggest anything he would wish to have said to Tribunal in response to Supplementary Submission – whether breach of rules of natural justice – whether, if so, discretion should be exercised against quashing Tribunal’s decision

National Mutual Life Association of Australia Ltd v Jevtovic (FCA/Sundberg J, 8 May 1997, unreported) cited
National Mutual Life Association of Australia Ltd v Campbell (2000) 99 FCR 562 cited
Stead v State Government Insurance Commission (1986) 161 CLR 141 applied
Fares Rural Meat and Livestock Co Pty Ltd v Australian Meat and Live-Stock Corporation (1990) 96 ALR 153 cited
Australian and Overseas Telecommunications Corporations Ltd v McAuslan (1993) 47 FCR 492 (FC) cited
Turner v Official Trustee in Bankruptcy (1996) 71 FCR 418 (FC) cited
Giretti v Commissioner of Taxation (1996) 70 FCR 151 cited
Attorney-General (Northern Territory) v Hand (1988) 15 ALD 186 cited

RAY BARRY SPENCER SOMMER v NM SUPERANNUATION PTY LIMITED & ANOR

N 1230 OF 2000

LINDGREN J
20 JULY 2001
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 1230 OF 2000

ON APPEAL FROM THE SUPERANNUATION COMPLAINTS TRIBUNAL CONSTITUTED BY MS NICOLE CULLEN, DEPUTY CHAIRPERSON,
AND MR ROSS CHRISTIE, MEMBER


BETWEEN:

RAY BARRY SPENCER SOMMER
APPLICANT

AND:

NM SUPERANNUATION PTY LIMITED
(ACN 008 428 322)
FIRST RESPONDENT

NATIONAL MUTUAL LIFE ASSOCIATION OF AUSTRALASIA LIMITED
(ACN 004 020 437)
SECOND RESPONDENT

JUDGE:

LINDGREN J

DATE OF ORDER:

20 JULY 2001

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.        The application be dismissed.

2.        The applicant pay the respondents’ costs.

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

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 1230 OF 2000

ON APPEAL FROM THE SUPERANNUATION COMPLAINTS TRIBUNAL CONSTITUTED BY MS NICOLE CULLEN, DEPUTY CHAIRPERSON,
AND MR ROSS CHRISTIE, MEMBER


BETWEEN:

RAY BARRY SPENCER SOMMER
APPLICANT

AND:

NM SUPERANNUATION PTY LIMITED
(ACN 008 428 322)
FIRST RESPONDENT

NATIONAL MUTUAL LIFE ASSOCIATION OF AUSTRALASIA LIMITED
(ACN 004 020 437)
SECOND RESPONDENT

JUDGE:

LINDGREN J

DATE:

20 JULY 2001

PLACE:

SYDNEY

REASONS FOR JUDGMENT

INTRODUCTION

  1. The applicant (“Mr Sommer”) appeals to the Court under s 46 of the Superannuation (Resolution of Complaints) Act 1993 (Cth) (“the Act”) on a question of law from a determination of the Superannuation Complaints Tribunal (“the Tribunal”).

  2. The first respondent (“the Trustee”) was, at all relevant times, the trustee of an “Adviser’s Superannuation…

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Details
Case
[2001] FCA 923
Decision Date

CaseChat Overview and Summary

Sommer v NM Superannuation Pty Ltd is an appeal against a decision of the Superannuation Complaints Tribunal (SCT) rejecting Mr Sommer's claim for a benefit from his superannuation fund. The fund's trustee, NM Superannuation, had earlier rejected Mr Sommer's claim. He subsequently complained to the SCT, which upheld the trustee's decision. The central issue before the court was whether the SCT had exercised its jurisdiction correctly and whether the SCT's decision was legally sound. A further question was whether the SCT's decision should be set aside on the basis that it failed to accord Mr Sommer procedural fairness.

The court examined the evidence and legal arguments presented by both parties. It considered whether the SCT had correctly interpreted and applied the relevant legislative provisions. The court also assessed the SCT's handling of conflicting medical evidence and its reasoning in reaching its decision. The court found that the SCT had exercised its jurisdiction correctly and that its decision was legally sound. It held that there was no basis for setting aside the SCT's decision on the ground of procedural unfairness. The court concluded that the SCT's decision should be upheld.

The court dismissed Mr Sommer's appeal and ordered him to pay the respondents' costs. The judgment emphasised the importance of the SCT's role in resolving disputes between superannuation fund members and trustees and the court's limited scope of review in such cases.

Orders

Orders of the court

1. The application be dismissed.

2. The applicant pay the respondents’ costs.

Background

Background to the litigation

On 28 August 1995 Mr Sommer lodged with the Insurer his application for the benefit, but the Insurer decided to reject his claim. The Trustee decided to endorse the Insurer’s decision. The Trustee reviewed its original decision and informed Mr Sommer that it had decided to affirm its decision and that of the Insurer to reject the claim. Section 14 of the Act provided for a person placed as Mr Sommer was, to make a complaint to the Tribunal that the decision of the trustee of the relevant superannuation fund was “unfair or unreasonable”. On 19 November 1997 Mr Sommer lodged a complaint dated 13 November 1997 with the Tribunal that the decision of the Trustee and of the Insurer not to pay him the benefit was of that kind. On 17 October 2000 the Tribunal determined “that the decision of the Trustee and of the Insurer was fair and reasonable”. On 17 November 2000 Mr Sommer filed in this Court notice of his present appeal from the determination of the Tribunal.BACKGROUND FACTS On the morning of 17 February 1995 Mr Sommer telephoned Dr George Lianos, consultant psychiatrist and psychotherapist. According to Dr Lianos, Mr Sommer was requesting help, did not know what was happening to him, was tearful, sounded to the doctor to be “flat, depressed, anxious, panicky and desperate” and “ felt that he was not able to keep going”. Dr Lianos saw Mr Sommer the same day as an emergency appointment. He saw him again on 23 February and on a regular weekly basis afterwards. According to his report, Dr Lianos advised Mr Sommer that he should “cease all kind of work immediately”. (Mr Sommer said, and it seems to have been accepted, that Dr Lianos’ recommendation was that that he should “cease working as an insurance agent for a period of 3-6 months”.) Mr Sommer ceased work immediately and, in fact, sold the insurance agency business shortly afterwards. Mr Sommer subsequently obtained employment managing a pet food business but has never returned to the insurance industry. There were numerous medical reports before the Tribunal. They were provided by the following six doctors:· Dr R O Nichols, Mr Sommer’s general practitioner;· Dr George Lianos, Mr Sommer’s treating psychiatrist and psychotherapist;· Dr Michael Williamson, consultant psychiatrist whose report was sought by Mr Sommer’s solicitors; and· Dr John Albert Roberts, Dr James P Maguire, and Dr Allan White, consultant psychiatrists, each of whom was asked by the Insurer to assess Mr Sommer. The body of expert medical opinion was conflicting. The Tribunal set out extracts from the doctors’ reports in its Review Determination and Reasons. Prior to February 1995, there had been several notable events in Mr Sommer’s life which formed part of the background to his telephone call to Dr Lianos on 17 February of that year. In summary, they were as follows:· Although he had been in the insurance industry since 1970, Mr Sommer experienced problems in connection with his business from a time prior to 1993 and extending throughout that year and 1994 and down to February 1995. Dr Lianos summarised Mr Sommer’s financial and business problems as follows:“Mr Sommer’s problems began prior to 1993 and appeared to relate very closely to his business difficulties. Financial pressures were clearly evident by June 1993 when he had a zero income from National Mutual. This was due to the fact that he lost a major client which appears to have precipitated a major financial crisis. He was under enormous financial pressure and as a result he reduced all his costs hoping to survive with new business in 1994. This plan failed. By June 1994 he had exhausted all his personal financial resources which included the residual capital from the sale of the house. In December 1994 a further $35,000 which came from an inheritance was also absorbed by the business without alleviating the problems.He redirected his attempts to estate planning in about November 1994. The long lead time between initiating new business and securing money meant that he was left with no income for a period of time whilst still having fixed costs in excess of $70,000 p.a. As a result he came under extreme pressure from financial companies to meet his repayments. ... He was embarrassed about his predicament and felt that he had made a big mistake. By the time he rang my office he felt that he was not able to keep going.”· In February 1992 Mr Sommer’s daughter was violently assaulted. In the assault, both her legs and one arm were broken (a cheek bone or jaw bone may also have been broken). The daughter was placed in a Witness Protection Program. A person was convicted and was released from custody, apparently in late 1993;· Mr Sommer and his family moved house in 1994 to assist in concealing his daughter’s whereabouts;· Mr Sommer’s son attempted suicide in September 1994;· Mr Sommer’s wife had serious health problems.REASONS FOR DETERMINATION OF THE TRIBUNAL

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

LINDGREN J
On the assumption that there was a breach of the obligation to accord procedural fairness, I would not, in the exercise of my discretion, for the reasons given in [28] to [32] above, set aside the Tribunal’s decision. (The manner of exercise of discretion in one case has no precedential value for the manner of exercise of discretion in a later case, but I note in passing that Foster J would have exercised his discretion against setting aside a decision for breach of the rules of natural justice in not altogether dissimilar circumstances in Attorney-General (Northern Territory) v Hand (1988) 15 ALD 186.)CONCLUSION For the above reasons, the application should be dismissed with costs.

Ratio Decidendi

Legal Principle Established

Established by: LINDGREN J

Full text does not contain this section.