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…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Stege and Commissioner for Superannuation

Details

AGLC: Stege and Commissioner for Superannuation [2001] AATA 1022
Case: [2001] AATA 1022
Decision Date: 18 December 2001

CaseChat Overview and Summary

In the case of Stege and Commissioner for Superannuation, the applicant, Mr Stege, sought a reconsideration of a decision made by the Commissioner for Superannuation ("ComSuper") under section 154(2) of the Superannuation Act 1976 (Cth). Mr Stege had previously applied for a late election to preserve his superannuation contributions, but his application was denied. He now sought an extension of time to apply for reconsideration of that decision. The dispute was heard by the Administrative Appeals Tribunal (AAT) in Australia.

The primary legal issues in this case involved whether Mr Stege's application for an extension of time to reconsider his previous application for a late election was justified under section 154(2) of the Superannuation Act 1976 (Cth). The AAT had to consider factors such as the reason for the delay, any prejudice caused by the delay, and the merits of the application.

The AAT found that there was prejudice as a result of the delay, primarily due to the destruction of relevant files in accordance with archival policy. Mr Stege's file in respect of his earlier membership had been destroyed, and there were substantial administrative difficulties in reconsidering the decision due to the absence of relevant evidentiary material. The AAT also noted that Mr Stege had not provided all the correspondence he held, which left a significant gap in the evidence. Additionally, there was confusion regarding Mr Stege's motivation in 1983, which further complicated the decision-making process.

The AAT concluded that Mr Stege's application for an extension of time was not justified. The delay caused prejudice to ComSuper, and there were substantial administrative difficulties in reconsidering the decision. The AAT found that Mr Stege had not provided all relevant information, and the reasons for his delay were not satisfactory. Therefore, the application for an extension of time was denied.

Orders

Orders of the court

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Background

Background to the litigation

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

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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 timeMr 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.

Ratio Decidendi

Legal Principle Established

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. 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).