Stege and Commissioner for Superannuation - [2001] AATA 1022

DECISION AND REASONS FOR DECISION [2001] AATA 1022

ADMINISTRATIVE APPEALS TRIBUNAL )

) No V01/474

GENERAL ADMINISTRATIVE DIVISION       )
           Re      KARLIS MARTINS STEGE
  Applicant
           And    COMMISSIONER FOR SUPERANNUATION
  Respondent

DECISION

Tribunal Mrs Joan Dwyer, Senior Member Dr P Fricker, Member Mr C Ermert, Member

Date18 December 2001
PlaceMelbourne

Decision The Tribunal affirms the decision under review.
(sgd) Joan Dwyer

Senior Member

SUPERANNUATION – Commonwealth Superannuation Scheme – application for review of decision refusing an extension of time under s 154(2) of the Act to seek reconsideration of a decision of the Commissioner made 27 May 1985 refusing to recognise a late election under s 157(1) of the Act - original election for preservation of superannuation rights changed to election for refund of contributions –- application to change election to preserve benefits more than 14 years after resigning – application refused – no request for reconsideration - whether in the interests of justice that time to seek reconsideration be extended – decision affirmed
PRACTICE AND PROCEDURE – application for review of decision refusing an extension of time in which to request reconsideration of a primary decision – no power to consider substantive issue on application to review decision refusing extension of time to apply for reconsideration under s 154(2) of the Act.
Superannuation Act 1976 s 137(1) and ss 154(1), (2), (3), (4), (5) and (6), 157(1)

Ashmore v Commissioner for Superannuation (2000) 32 AAR 231

Brisbane South Regional Health Authority v Taylor (1996) 139 ALR 1

Chalk v Commissioner of Superannuation (1994) 33 ALD 420

Comcare v A'Hearn (1993) 119 ALR 85

Commissioner for Superannuation v Ashmore [2001] FCA 666

Commissioner for Superannuation v Boardman (1994) 33 ALD 569

Hunter Valley Developments Pty Ltd and Ors v Minister for Home Affairs

and Environment (1984) 58 ALR 305

Lucic v Nolan (1982) 45 ALR 411

Re Beard and Commissioner for Superannuation [1999] AATA 502

Re Charles and Commissioner for Superannuation, (1993) 18 AAR 61

Re McKnight and Commissioner for Superannuation (1998) 49 ALD 84

Re Morgan and Commissioner for Superannuation (unreported W92/200,

12 March 1993)

Re Schofield and Commissioner for Superannuation (AAT 10006, 14 February 1995)

REASONS FOR DECISION

18 December 2001 Mrs Joan Dwyer, Senior Member Dr P Fricker, Member Mr C Ermert, Member

background

This is an application under s 154(6) of the Superannuation Act 1976 ("the Act"), for review of a decision of the Commissioner for Superannuation ("the Commissioner"), made 10 January 2001, and confirmed on reconsideration on 11 April 2001. The reviewable decision refused Mr Stege an extension of time, under s 154(2) of the Act in which to seek reconsideration of a decision of the Commissioner made under s 157(1) of the Act on 27 May 1985, refusing an application to make a late election to preserve superannuation rights under s 137(1) of the Act.
Mr Stege appeared. Mr Rule, a departmental advocate, appeared for the Commissioner for Superannuation. The Tribunal had before it the documents ("the T documents") lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 and the exhibits tendered during the hearing. After the hearing Mr Rule sent a letter dated 16 November 2001 to the Tribunal, giving some further indication as to the value to the applicant of his late election ultimately being recognised. That letter has been taken into evidence and marked as exhibit R4. Mr Stege gave evidence. Evidence on his behalf was also given by Dr Kaplan.
This matter concerns ss 137(1) and 157(1) of the Act. Those provisions have given rise to a number of decisions of this Tribunal. However the circumstances of this particular matter are unusual. The sections concern the options available to a member of the Commonwealth Superannuation Scheme ("CSS") on resignation. A member on resignation may elect one of three options. Section 137(1) provides that such an election should be made within 21 days, but a member may seek to have a late election recognised under s 157(1). Usually, applicants before the Tribunal are seeking to make a late election for preservation of their superannuation rights. Such an election has considerable advantages in terms of the rate of pension payable on retirement at age 55 or over. Applicants commonly give evidence that they did not understand what was involved in making an election to preserve their superannuation rights at the time they resigned from their employment.
The unusual feature of this matter is that Mr Stege did originally elect to preserve his superannuation rights, in November 1980. In April 1983 he applied for recognition of a late election to apply for a refund of accumulated contributions. That was allowed, and he received the refund he had requested. Approximately one and a half years later, Mr Stege wrote to ComSuper asking it to take back the refund of contributions and again allow him to elect the preservation option. That request was made in October 1984. It was refused on 27 May 1985. Mr Stege did not apply for a reconsideration of that decision until 11 February 1999 (T23/32). In fact even then Mr Stege did not seek a reconsideration of the decision of 27 May 1985. Although he referred to it in his letter, he attempted to make a fresh application for recognition of a late election under s 157(1) of the Act. That application was unsuccessful. Not until the reconsideration process did ComSuper focus on the earlier refusal of 27 May 1985. When it did, Mr Stege's solicitor was advised that Mr Stege would have to seek reconsideration of that decision, rather than proceed with the application for reconsideration of the 1999 decision.
legislative provisions
In order to understand the issues it is necessary to set out the relevant legislative provisions. Sections 137(1), 154 and 157(1) provide as follows:
137. (1) A person who:
(a) ceases to be an eligible employee in circumstances to which paragraph (b) does not apply and, upon so ceasing, is not entitled to pension under this Act or invalidity benefit in accordance with section 69, 72 or 73; or
(b) ceases to be an eligible employee in circumstances by virtue of which the person is to be deemed, under subsection 58 (3), or under section 58A or 58B, to have retired involuntarily;
may, not later than 21 days after the person so ceases to be an eligible employee, elect, by notice in writing to the Board, that this Division apply in relation to the person.
154. (1) In this section:
"decision" has the same meaning as in the Administrative Appeals Tribunal Act 1975;
"reviewable decision" means a decision of the Commissioner, or a delegate of the Commissioner, under this Act, under the superseded Act or under the regulations made under either of those Acts, and includes a decision of the Superannuation Board, or a delegate of the Superannuation Board (other than a decision under section 141 of the superseded Act);
"Superannuation Board" means the Superannuation Board established by the superseded Act.
(2)A person affected by a reviewable decision who is dissatisfied with the decision may, by notice in writing given to the Commissioner within the period of 30 days after the day on which the decision first comes to the notice of the person, or within such further period as the Commissioner allows, request the Commissioner to reconsider the decision.
(3)There shall be set out in the request the reasons for making the request.
(4)Upon receipt of the request, the Commissioner shall reconsider the decision and may confirm or revoke the decision or vary the decision in such manner as the Commissioner thinks fit.
. . .
(6)Applications may be made to the Administrative Appeals Tribunal for review of reviewable decisions that have been confirmed or varied under subsection (4) and for review of decisions of the Superannuation Board, or delegates of the Superannuation Board, made under section 141 of the superseded Act.
157. (1) Notwithstanding anything contained in this Act, where an election under this Act is made by a person after the expiration of the period allowed by or under this Act for the making of the election, and the Board is satisfied that in all the circumstances of the case it is desirable that the election should be recognized, the Board may direct that the election be treated as if it had been made within the period allowed and the election shall have effect accordingly.

the facts

Mr Stege joined the Bureau of Meteorology in 1968. He resigned to take up a position with the Commercial Bank of Australia ("CBA") with effect from 5 November 1980. The following day he completed a form S2A in which he elected for preservation of superannuation rights under the Act.
Mr Stege said in evidence that at the time he resigned from the Bureau of Meteorology he was under some strain due to the break up of his marriage. He had decided to preserve his superannuation rights as that saved him having to think about that issue. He said that after he had been with the CBA for a time, he thought it would be a good idea to roll his superannuation benefits from the CSS scheme into the CBA superannuation scheme. He made some preliminary inquiry of the bank about whether that was possible, and was told that it was. By letter dated 18 January 1983 his solicitor wrote to the Commissioner advising that Mr Stege had instructed him that he wished to change his election to obtain a refund of accumulated contributions. A formal application seems to have been made by Mr Stege on 15 April 1983, but there was no copy of that letter before the Tribunal. It is referred to in T12/18.
The letter from Mr Stege's solicitor refers to information contained in letters from the Commissioner to Mr Stege. One letter, dated 19 April 1982, (T6 pp9-10) clearly stated that Mr Stege's accumulated contributions at that time, totalled $7023.42, and that his deferred benefit at age sixty would consist of an indexed government pension of approximately $19,146 gross per annum, together with a non-indexed contributor financed benefit of approximately $7701 gross per annum. The letter also advised that when the deferred benefit became payable, Mr Stege could elect to receive the non-indexed contributor financed benefit as a lump sum of approximately $77,016.
By letter dated 29 June 1983 (T13/19), the Commissioner advised Mr Stege that his request for cancellation of election for preservation of superannuation rights had been granted. The Commissioner advised that Mr Stege should have already received his refund of accumulated contributions.
About 16 months later, Mr Stege sought to again change his election. On 23 October 1984 he wrote to the Commissioner as follows (T15/21):
I left the Commonwealth employment in November 1980, after twelve years employment at the Bureau of Meteorology. At that time I decided to take a deferred benefit which I kept until 1983. On about the 15th of April 1983, based on advice which I believe was not in my best interests I instructed my solicitor to have the original election cancelled. Since that time my circumstances have changed and I am contemplating marriage again and would like to give my future wife the protection of my superannuation. Consequently I would like to make a fresh election and re-instate my original deferred benefit. The repayment of the amount $7,973.59 which was paid to me on about the 29th of June 1983 would not prove difficult to me. Currently the balance of my current account is about $12,000 and I could repay the amount of the contributions with interest at any moment. I believe that legislation is being enacted to cover cases like mine; also I have applied for a position within the public sector. Hoping that you will view my request favourably. (emphasis added)
In his evidence, Mr Stege said that the reason given in his letter of 23 October 1984 for seeking to refund his contributions and re-elect to preserve his superannuation rights, was not correct. The letter says that Mr Stege was seeking to change his mind, for the second time, in order to give a future wife the protection of his superannuation. He told the Tribunal that the real reason had been because the CBA super scheme had closed by the time he sought to deposit his refund of contributions, $7,973.59, in that scheme.
In reply to his letter of 23 October 1984, Mr Stege received the decision dated 27 May 1985, which he now seeks to review. That decision stated as to the reason for refusal, at paragraph 3 (T16/22):
3. The delegate of the Commissioner is not satisfied that the circumstances of your case are sufficient to allow an election for preservation to be accepted at this late stage. The provisions of the Act regarding late elections were not designed to cover cases such as yours i.e. where a valid election was cancelled at your request and then another election made much later.
Mr Stege did not seek reconsideration of that decision, even though he was sent a copy of s 154 of the Act, together with the letter of 27 May 1985. As set out in paragraph 5 of these reasons, s 154(2) of the Act provides that a request for reconsideration shall be made within 30 days, or within such further period as the Commissioner allows.
Mr Stege took no further action in the matter until 11 February 1999, when he wrote to ComSuper as follows (T23/32):
I worked for the Commonwealth Government from 1968 to 1980 with the Bureau of Meteorology. In 1980 I resigned to take up a position with the Commercial Bank of Australia. Initially I preserved my benefit in the fund and in 1982 I decided to withdraw the preserved benefit not knowing that I was giving up the employer contributions. Having been advised by my solicitor I requested to have my election for the preserved benefit payout election revoked. This was refused and I was told that there was not [sic] possibility of changing the situation.
I would like to make a late election at this stage. Please register this as late election Claim. Currently I work for the Commonwealth Government with the Australian Customs Service and have 12 years service.
On 19 February 1999 Mr Stege was advised that his letter of 11 February 1999 "has been accepted as an application to make late election under subsection 137(1) of the Superannuation Act 1976" (T24/33). In response to a request to provide further information, Mr Stege wrote again to ComSuper on 2 March 1999. His letter (T25/35) included at paragraphs 2 and 3 the following:
After leaving the Bureau of Meteorology I started work at the CBA (Commercial Bank of Australia) in October 1980. As I was told by an officer of the CSS that I could not revoke my payout from the CSS and legal action to challenge this would be unsuccessful I investigated the possibility of transferring my payout to the bank's super scheme. This was not possible as the rules did not permit it. There were no institutions in 1982 where I could roll over my contributions at that time. I paid off part of my mortgage on my unit.
In 1982 the CBA merged with the Bank of New South to become Westpac. In 1986 I left the bank and on the 2 of June 1986 I began work with the Australian Customs Service. On leaving I rolled over my contributions into B.T (Banker's Trust) fund which are worth as at 31 December 1998 $12,593. At present I have been with the CSS for 12 twelve [sic] years.
After further correspondence with ComSuper, Mr Stege made available a copy of the Community and Public Sector Union ("CPSU") circular which he said had led him to make his late application for cancellation of his earlier election. That circular (T40/59) included the following:
Have you been in the CSS more than once? The CSS is the super scheme which was compulsory for almost all Australian Government employees in the Australian, NT and ACT Public Services, Telecom/Telstra, Australia Post, the ABC, CSIRO etc who were first employed before the scheme was closed to new staff on 1 July 1990. . . . Background to the "CSS late election" issue For many years CPSU has been advising members of the possibility to make an application to have their decision to withdraw their super contributions on resignation nullified and so allowing them to preserve their own contributions in the CSS. This allows members to gain access to an employer financed benefit. The employer provides no benefit (other than 3% super guarantee contributions) if an employee takes their own contributions as a lump sum on resignation from the CSS. Many employees were never advised of the right to preserve their own contributions and particularly for those who return to public sector employment and the CSS later, the comparative loss of employer benefit by not preserving superannuation contributions on resignation can be financially significant. In order to gain the right to reverse the original decision to take a lump sum of employee contributions, the member currently needs to show they were not in a position to make a proper decision initially. In many cases members were not advised that they could choose to leave their own contributions preserved and that this was the ONLY way for a resigning CSS member to gain an employer funded benefit. . . .
As explained in paragraph 4 above, the correspondence in 1999 gave rise to a primary determination dated 20 July 1999 not to recognise a late election (T32/48). That determination was made by a delegate who seems not to have realised that a similar decision had been made on 27 May 1985, and that Mr Stege had not sought reconsideration of that decision. When ComSuper became aware of the earlier unsuccessful application, Mr Stege was advised that he should not have been treated as having made a fresh application under s 157(1), and that he was obliged to seek an extension of time under s 154(2) of the Act, in which to request the Commissioner to reconsider the decision of 27 May 1985. That appears to be the effect of the Federal Court decisions in Commissioner for Superannuation v Ashmore [2001] FCA 666 and Ashmore v Commissioner for Superannuation (2000) 32 AAR 231 (see paragraphs 14-22). Mr Stege was informed that for the extension of time application, he would need to submit reasons for not having sought the reconsideration within the specified timeframe. He was also asked to provide copies of all correspondence he was holding, as ComSuper had destroyed its old file, in accordance with archival policy.
consideration of the issue before the tribunal
It is generally accepted that the starting point in considering an application for an extension of time is Hunter Valley Developments Pty Ltd and Ors v Minister for Home Affairs and Environment (1984) 58 ALR 305. In that matter Wilcox J set out six relevant factors. They are summarised in the headnote to the case as follows:
(a)the fact that the applicant bears the onus of rebutting the prima facie rule that no s 5 proceedings commenced outside the prescribed period will be entertained by the court by showing an "acceptable explanation of the delay" and that it would be "fair and equitable in the circumstances" to extend the time;
(b)any action taken by the applicant, apart from the actual making of an application for review under the ADJR Act, which continues to make the decision-maker aware that the finality of his decision is being contested;
(c)any prejudice to the respondent which may have resulted from the delay;
(d)any unsettling of people, other than the respondent, or of established practices;
(e)the merits of the substantial s 5 application;
(f)considerations of fairness as between applicants and other persons in like positions: it is not only prejudice vis-á-vis the parties but against the wider public interest which must also be taken into consideration.

The Federal Court has clarified, in Comcare v A'Hearn (1993) 119 ALR 85 that an acceptable explanation of the delay is not a pre-requisite to success in these matters. However it is clearly a relevant factor.
(a) an acceptable explanation for the delay

Mr Stege's evidence was that the reason he had not sought a reconsideration of the decision of 27 May 1985, within 30 days, or prior to 1999, was that his solicitor and somebody at ComSuper, probably Mr Hoad, whose reference was on the letter of 27 May 1985 (T16/22), both advised him that his prospects of success were not good. Mr Stege said that when he received the letter of 27 May 1985 refusing his application to make a second late election, he telephoned the Australian Government Retirement Benefits Office ("AGRBO"), and asked for Mr Hoad. The person he spoke to said words to the effect "I should not bother appealing as I would lose" (trans. p24).
Mr Stege also said he relied on advice from his solicitor, Mr Henning, which was also not encouraging. That evidence is confirmed by exhibit R3, a letter from Mr Henning to Mr Stege dated 21 June 1985. However, Mr Henning wrote that as Mr Stege had instructed that he wished to proceed he was "considering in detail, the appropriate course of action open to you".
On 8 March 2001, Mr Harding, a solicitor with Slater and Gordon, solicitors, who were then acting for Mr Stege, wrote to ComSuper setting out an account of Mr Stege's instructions as to his discussions with Mr Henning on the issue (T66/114). He wrote:
I am instructed that Mr Henning provided further verbal advice to my client in relation to the matter of his election. This conversation occurred after my client's discussion with an officer of the AGRBO. I am instructed that my client advised Mr Henning of his discussion with the AGRBO officer. In response, Mr Henning expressed a pessimistic view of my client's case. He advised my client not to proceed because it would take time and be more costly. Moreover, he advised that my client's rights of review were dependent on the internal process of the Commissioner for Superannuation. On the basis of my instructions, it is apparent that Mr Henning incorrectly advised my client in relation to the extent of his rights of review. It seems clear that Mr Hennings misapprehension concerning the extent of my client's rights of review informed his opinion of my client's prospects of success.
As Mr Harding pointed out, it would have been incorrect for anyone to tell Mr Stege that his rights of review were dependent on the internal process of the Commissioner. However a copy of s 154 of the Act was enclosed with the letter of 27 May 1985 (T16/22). That enclosure (R2) included s 154(6) which clearly provides that applications may be made to the Administrative Appeals Tribunal for review of decisions of the Commissioner or a delegate, which have been the subject of internal review. It is therefore hard to see how Mr Henning would have given incorrect advice on this point, or how Mr Stege, who received the letter and enclosure, would have believed that his rights of review were dependent on the internal process of the Commissioner.
Mr Stege's prospects of success in an application to have a second late election recognised may well have not been good. We are not satisfied that advice to that effect was incorrect. The advice which Mr Stege says was given to him by Mr Hoad and by Mr Henning, does not in our view provide an acceptable explanation of the delay. Even if an officer of AGRBO told Mr Stege that he did not have a good chance of success, it would have been clear to him, as an intelligent man, that he could have still exercised his right to test his chance of success.
The delegate who made the original decision concluded (T62/105):
The delegate noted that the length of the delay in making the request for reconsideration (almost 14 years) had been substantial. Mr Stege had been adequately advised of his rights to request reconsideration at the time of the notification of the original decision and had received notification of the time limit in which to do so.

That is all correct. Mr Stege explained that Mr Hoad's advice and that of Mr Henning was not encouraging. He added (trans. p27):

I thought to myself, well, why go through that whole process, given the – this original letter, and also as Mr Henning said – well, like I got to – basically, cost money and he thought that - the – the process was internal to them and I thought the same thing. So, I didn't proceed with it.

We find that Mr Stege considered his prospects in 1985, and decided the chance of success did not warrant the cost of the proceedings. We do not accept that the issue about review being internal or external was the major reason why Mr Stege did not seek reconsideration in 1985.

It was suggested to Mr Stege, in the decision of 20 July 1999 (T32/46) that according to the CSS Board of Trustee's late preservation acceptance guidelines, one means of showing an acceptable explanation of delay could be by producing medical evidence that a person did not understand his rights, and did not understand what he was doing. Mr Stege called his treating doctor, Dr Kaplan, to give evidence on that issue. Dr Kaplan had provided two letters (T35/51 and T44/64). In those letters he said that during the period 1981 to 1983 Mr Stege was quite distressed over his marital break-up and other unpleasant events in his life, and that his judgement and decision making was almost certainly affected. In the second letter (T44/64) dated 23 May 2000, Dr Kaplan added that Mr Stege has always had a long standing problem with anxiety, and been a worrier and has a somewhat obsessive personality, and that these matters interfere with rational judgement. He also referred to Mr Stege being overwhelmed by his divorce and other family problems. However the T documents (T48/69) show that Mr Stege's property settlement was finalised in March 1981 and that his divorce decree was made absolute in March 1982. The period we are looking at only starts after 27 May 1985.
Dr Kaplan did not describe Mr Stege as having any major mental problems at the relevant period. He said that he has known Mr Stege since 1981, and he has always been a little bit obsessive and affected by stress. He described him as "not very well organised generally, . . . but functioning at some levels, obviously going to work and always well dressed and pleasant, but a little bit all over the place" (trans. p5).
Dr Kaplan said that his notes show that around 1983 Mr Stege was concerned about his alcoholic brother, and that he had some problems with drinking alcohol to excess himself. In 1984 and 1985 Mr Stege had asked him for a prescription of sleeping tablets. Dr Kaplan said that he would not be prepared to say that Mr Stege was suffering from a mental condition that would have overborne his ability to act rationally or to appreciate the consequences of his actions. He preferred to say that Mr Stege had a personality problem with quite severe stress and anxiety and obsessive compulsive features which would interfere with his judgement at some levels.
Mr Stege had responsible employment throughout the relevant period. His matrimonial troubles were well over by late 1984 when Mr Stege was contemplating a new marriage. We do not consider that the evidence established that there was any medical explanation of the delay after 30 days from 27 May 1985.

(b) action taken by Mr Stege to make the Commissioner aware that the finality of his decision was being contested

There was no action by Mr Stege between 27 May 1985, (or his conversation with an officer of AGRBO, probably Mr Hoad, shortly after that date) and February 1999 to show that the finality of the decision of 27 May 1985 was being contested.

(c)prejudice to the CSS or the Commissioner

In this matter there is prejudice as a result of the delay. The ComSuper file has been destroyed in accordance with archival policy, (T56/81). The reasons adopted by the delegate who made the decision of 2 January 2001 said on this issue (T61/95):
The administrative difficulties in reconsidering the decision due to the absence or inadequacy of relevant evidentiary material after such a lapse of time
Mr Stege's file in respect of his earlier membership has been destroyed in accordance with archival policy. Therefore there are substantial administrative difficulties in reconsidering the decision in his case, already demonstrated by the fact that ComSuper was initially unaware that Mr Stege had already had a late election for preservation rejected. ComSuper is reliant on material held by Mr Stege which he has produced selectively over a twelve month period. Critical information is missing and in particular the reasons provided by Mr Stege in 1983 which persuaded the delegate to allow him to cancel his election for preservation. Despite the extensive correspondence from the period which Mr Stege has clearly retained and an express request that he produce a copy of this letter, he has not done so.
Mr Stege was understandably offended at the suggestion that he had "selectively" produced material. He read the reasons as implying that he had intentionally withheld the letter he sent in 1983, providing the reasons why he wished to cancel his election for preservation. Mr Stege said that he had, as requested, provided the Commissioner with copies of all correspondence that he had been able to find. He explained that he had sent his correspondence to a solicitor who had formerly acted for him in the matter, and it was possible that she had lost some of the correspondence. We accept that Mr Stege no longer has the letter of 15 April 1983, referred to in the letter from his solicitor of 8 June 1983 (T12/18). However, the fact that the letter cannot now be produced does leave a significant gap in the evidence. It is impossible for findings to be made as to the situation which influenced the Commissioner to allow Mr Stege's first cancellation of an election, so as to recognise his first late election.
There is also further prejudice to the respondent, in that Mr Stege's reason for having changed his mind in October 1984, and again seeking to preserve his superannuation rights, can also not be ascertained. Mr Stege in his evidence, in his statutory declaration of 2 March 1999, and in his letter of that date said that the reason why he wished to re-invest his refunded contributions in the CSS was that he had been unable to transfer the payout by way of refund of contributions, to the CBA superannuation scheme. But it was not clear from his evidence whether that was because the rules of the CBA superannuation scheme did not permit such transfer or because of the merger of the CBA with the Bank of New South Wales. His evidence gave the impression that the merger occurred after he had been informed by the CBA Superannuation Scheme that it could accept a deposit of his refund of accumulated contributions. However T25/35 and T26/36 state that the merger was in 1982. That was before Mr Stege applied for his first election to be cancelled. Thus there is some confusion in that account of Mr Stege's motivation in 1983.
The evidence however becomes even more confused when we attempt to make findings as to the reason why Mr Stege applied to re-invest those contributions in the CSS in October 1984. His letter to ComSuper seeking to make a second late election referred only to his contemplated marriage and the desire to make provision for his wife by superannuation. It said nothing at all about any plan which had not come to fruition to invest the funds in the CBA superannuation scheme. The Tribunal tried to find out from Mr Stege why, if he was unable to invest his refunded contributions with the CBA scheme, it had taken from June 1983 to October 1984 for him to apply to re-invest those funds in the CSS. He was extremely vague on that issue (trans. p23):
But you see, that is – you got this contribution according to that letter – T13, page 19, in June '83 approximately?---Yes.
And you are not applying to put the money back in until October '84?---Yes.
So that doesn't make it look as though you had gone along to the CBA as soon as you got your money and said, "Well look, I have got this money as discussed, would you pop it in this fund for me now". Because, if that had happened soon after June '83 and they had said no, well then you would have been writing straight back to the Commissioner saying, "Well look, I say it is desirable that you now take the money back and let me get back to my earlier preservation"?---Yes, well the thing is that, exactly the – why the timing is as such I don't know, right?
But you can see that - - -?---Yes, okay.
- - - more than a year is quite different from a short time?---Yes, I understand that. I mean, so – but the point really being is in the context of all that was going on in the fact of the merger, my life, and all the rest of it, these sorts of things weren't primary.
Well, do have any means of even knowing when that merger was?---Well, yes, we could find that out, right? The thing is that, that is my recollection, right?
The Tribunal returned to this matter later in the hearing, asking Mr Stege to explain the sequence of events after he joined the CBA. He was still very vague (trans. p52):
But then at what stage of the game, then, did the – did you become aware that the merged scheme would not accept your transfer?---I am not – that – that date I don't know. I don't know. It is only that after I got my – the fact it took so long to get the money, right. Then afterwards, right, it was impossible. That was my understanding, right. The – because, as I said with the – the CBA scheme, right, it is a – it is a defined benefit scheme. So, theoretically, I should have been able to take it, right. So, I – but those details I am not exactly accurate, right.
Okay. Well, then that comes back to the bit of the difficulty that, if having learnt that, that the CBA new Westpac scheme would not take your transfer, and you say that that is what then prompted you to go back to and ask for that decision to be changed - - -?---Yes.
- - - why was that not the basis of your letter of request?---Basic – I don't know. I really don't know. I suppose being – having done something stupid, you really [don't] want to admit to doing something stupid, right?
In fact the T documents show that it did not take a long time for Mr Stege to obtain the refund of contributions. The first letter of request asking about the necessary steps to apply for a refund of contributions was sent by his solicitor on 18 January1983 (T8/13). The application was only made on 15 April 1983 (see T12/18) and the refund had been sent by 29 June 1983 (T13/19).
Toohey and Gummow JJ in Brisbane South Regional Health Authority v Taylor (1996) 139 ALR 1 at pp6 and 7 considered the issue of prejudice in an application for an extension of time. Their Honours said:
In one obvious sense the prejudice to the present respondent is absolute if her application is refused. She can never litigate her claim. But that cannot be enough of itself to warrant an extension of time; in truth there would be no discretion to be exercised.

Their Honours then went on to say:

The real question is whether the delay has made the chances of a fair trial unlikely. If it has not there is no reason why the discretion should not be exercised . . .

In this matter we have formed the view that the delay has made the chances of a fair trial unlikely. A hearing now would not be able to make accurate findings of fact as to events many years ago, because documents are lost and Mr Stege's memory of events 15 years ago is very vague.

We accept that Mr Stege was doing the best he could to recollect the situation in 1983 and 1984, but the evidence he was able to offer was not such as would allow the Commissioner, or this Tribunal, on review, to make an informed decision as to whether it would be desirable to recognise a late election by Mr Stege. On one hand it is always desirable to recognise a late election in that there are clear financial benefits to the applicant in preservation. But clearly the legislation does not intend that every late election for preservation will be recognised. There is some balancing required between the reasons why a late election is sought and the disruption to the superannuation scheme caused by recognising late elections. The legislative scheme sets a timetable for elections with power to extend time where that is desirable. It is not sufficient simply to say that all late elections should be recognised because they are financially desirable from the point of view of the applicant. A discretion must be exercised. In this matter the available evidence is so inadequate that the Commissioner would not be able to make the necessary findings of fact on which to reach a conclusion as to the desirability of recognising a late election. In Chalk v Commissioner of Superannuation (1994) 33 ALD 420 Davies J, at p425, explained that it is important to form a view whether it is in the interests of justice that time be extended. Here the gaps and inconsistencies in the evidence make it impossible for a decision-maker to form a view as to the interests of justice.
In Re Beard and Commissioner for Superannuation [1999] AATA 502, Senior Member Burton, at paragraph 26, referred to the problems caused by a lapse of four years in exercising a right to apply for review by the Tribunal. She said:
Nevertheless, the respondent is put in an unenviable position if it is to defend the application. It is dependant upon the applicant for most of the records. Time has elapsed and memories of what occurred in 1988, if difficult to recall in 1995, will be more difficult by the elapse of a further four years.

In this matter we are looking a lapse of 14 years in seeking a reconsideration, but more significantly, the evidence does indeed establish that as time has elapsed, Mr Stege's memories of what occurred in 1983, 1984 and 1985 have become so blurred that he was not able to tell us the sequence of events that led to his attempt to make a second late election.

(d)unsettling of people other than the respondent or of established practises

This is the first case which has come to our attention where one cancellation of election and a late election have already been recognised. If a further late election were recognised that would create considerable administrative disruption. Similarly if a late application for reconsideration were allowed 14 years, instead of 30 days, after the original decision, there would be significant unsettling of established practices. The administration of the CSS is made more complex or difficult, if late applications for reconsideration and for late elections are recognised. Sometimes that administrative inconvenience, and the unsettling of other former members of the scheme who have abided by the time limits in the Act, is required in the interests of justice. There was no evidence tending to show that on balance this is one of those cases.

(e)the merits of the substantial application

As already stated there would, as shown in exhibit R4, be a significant financial benefit to Mr Stege in the recognition of his late election. For pension purposes his whole service of 27 years would be recognised, rather than only his second period of service of 15 years. However, this case has less merit than most. Mr Stege did originally apply for preservation of superannuation rights. Thus he was clearly aware that the preservation option was available to him. That is in contrast to decisions where the Tribunal has found that applicants were not aware that they had any option other than to apply for a refund of accumulated contributions on resignation, (see Chalk v Commissioner of Superannuation (1994) 33 ALD 420, Commissioner for Superannuation v Boardman (1994) 33 ALD 569, Re Schofield and Commissioner for Superannuation (AAT 10006, 14 February 1995), Re Charles and Commissioner for Superannuation, (1993) 18 AAR 61, Re McKnight and Commissioner for Superannuation (1998) 49 ALD 84 and Re Morgan and Commissioner for Superannuation (unreported W92/200, 12 March 1993)). Further, in many matters the evidence has been that there was advice given employees on resignation which was inaccurate. There is no evidence to that effect in this matter, nor evidence of any other compelling reason why in this matter the usual time limits should not apply.

Mr Stege knew of the preservation option when he signed the Form S2A (T3/5) on 6 November 1980. After that he received detailed letters from the Commissioner explaining his entitlements (T5/7, T6/9 and T7/11). It is true that those letters are somewhat confusing, particularly T5/7, and that the Commissioner acknowledged an error in regard to the advice given about deferred benefit by way of invalidity pension. However, it is significant that the letter of 19 April 1982 (T6/9) did, in paragraphs 2 and 3, contrast in dollar terms the benefit of a refund of accumulated contributions as at 15 April 1982, namely $7023.42 and a deferred benefit at age 60 of an indexed pension of approximately $19,146 gross per annum, plus the non-indexed contributor financed benefit of $7701 gross per annum, or a lump sum of $77,016. It was after receiving that information that Mr Stege applied to cancel his election to preserve his superannuation rights and instead to take a refund of accumulated contributions. He was therefore aware of the financial cost of electing to take the refund of accumulated contributions, rather than the deferred benefits to which he would ultimately have become entitled, if he chose to preserve his superannuation rights.
In an application for an extension of time no full investigation can be made of the merits of the substantial application. But an applicant's case will be stronger where it is clear that there is a strong case on the substantive issue. In Lucic v Nolan (1982) 45 ALR 411 at p417, Fitzgerald J said:
Whilst there are obvious reasons why there should be no attempt at a full investigation of the merits of the application for review on an application for an extension of time, I would not exclude from consideration in an appropriate case some obvious strength or weakness in an applicant's case or matters which might justify the refusal of relief, if the court has a discretion to do so where a ground for relief is made out.

There are no obvious strengths to Mr Stege's case. There are some matters which make it seem like a weak case for recognition of a second late election.
conclusion

We have concluded that it would not be fair and equitable in the circumstances to extend the time provided in s 154(2) of the Act, to apply for a reconsideration of the decision of 27 May 1985, from 30 days to approximately 14 years.
The decision under review will be affirmed.
I certify that the 44 preceding paragraphs are a true copy of the reasons for the decision herein of Mrs Joan Dwyer, Senior Member, Dr P Fricker, Member and Mr C Ermert, Member
Signed:         Grace Carney
  Associate
Date/s of Hearing  7 November 2001
Date of Decision  18 December 2001
Counsel for the Applicant        Nil
Solicitor for the Applicant         Nil - Self Represented
Counsel for the Respondent    Nil
Solicitor for the Respondent    Nil
Departmental Advocate           Mr J Rule