The Repatriation Commission v Wilson, Kenneth Hastings

[1996] FCA 892

CATCHWORDS

DEFENCE AND WAR - Defence Forces - Veterans' Affairs - Special Rate pension under s 24 of Veterans' Entitlements Act 1986 - whether veteran, "by reason of incapacity from ... war‑caused injury or war‑caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking ..." - relevance of veteran's age - whether presumption that veteran above standard retirement age incapable of undertaking remunerative work.

Veterans' Entitlements Act 1986, s 24
Repatriation Commission v Strickland (1990) 22 ALD 10 (FCA/FC)

THE REPATRIATION COMMISSION v KENNETH HASTINGS WILSON

No NG 979 of 1995

Lindgren J
Sydney
16 October 1996

IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )        No NG 979 of 1995
GENERAL DIVISION                 )

On appeal from the Administrative Appeals Tribunal in its
                Veterans' Appeals Division

BETWEEN:

THE REPATRIATION COMMISSION
  Applicant

AND:

KENNETH HASTINGS WILSON
  Respondent

CORAM:Lindgren J

PLACE:Sydney

DATE:16 October 1996

MINUTE OF ORDERS

THE COURT ORDERS THAT:

1. The applicant's appeal be allowed.

1. The decision of the Administrative Appeals Tribunal dated 24 November 1995 be set aside.

1. The case be remitted to the Administrative Appeals Tribunal to be heard and decided again by it in accordance with law, and, in particular, in conformity with the Reasons for Judgment of Lindgren J dated 16 October 1996.

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 )        No NG 979 of 1995
GENERAL DIVISION                 )

On appeal from the Administrative Appeals Tribunal in its
                Veterans' Appeals Division

BETWEEN:

THE REPATRIATION COMMISSION
  Applicant

AND:

KENNETH HASTINGS WILSON
  Respondent

CORAM:Lindgren J

PLACE:Sydney

DATE:16 October 1996

REASONS FOR JUDGMENT

INTRODUCTION
The applicant ("the Commission") "appeals" pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 from a decision of the Administrative Appeals Tribunal ("the AAT") in its Veterans' Appeals Division dated 24 November 1995. By the decision appealed from, the AAT affirmed part of a decision of the Veterans' Review Board ("VRB") dated 16 May 1994 and set aside the remainder of that decision, substituting a different decision for the part set aside. It is in respect of the setting aside and the substituted decision that the Commission complains.

By its decision dated 16 May 1994, the VRB had assessed the pension of the present respondent ("the Veteran") at 40% of the General Rate from and including 20 February 1992 and 60% of the General Rate from and including 18 November 1992. The AAT affirmed that part of the Commission's decision which assessed pension at 40% of the General Rate from and including 20 February 1992 but set aside that part which assessed the pension at 60% of the General Rate from and including 18 November 1992 and substituted for the latter a decision that the Veteran was entitled to the "Special Rate pension" on and from 18 October 1992. The Special Rate pension is that provided for in s 24 of the Veterans' Entitlements Act 1986 ("the VE Act").

WORK HISTORY
The Veteran was born on 9 January 1921.  Beginning in 1936 as a telegraph messenger, he worked in the Post‑Master General's Department.  His work there was interrupted by war service, including operational service, from 28 August 1939 to 23 April 1946.  After discharge, he resumed working in the Department and his pre-war training as a telephone technician.  However, he did not complete this training because he was required to have two operations on a ganglion on his left foot.

He took up a position as a base grade clerk in the Department's engineering division.  He advanced through various promotions during the remainder of his working life which came to an end when he retired on 9 January 1981 - his sixtieth birthday.  When given the choice in the early 1950s, he had decided to retire at the age of 60 rather than 65 in view of the possibility that certain conditions from which he suffered might worsen over the years.  At the time of his retirement, the Veteran was an administrative officer grade 8, supervising about 65 clerical staff.  If he had not retired upon attaining the age of 60 years, it would have been compulsory for him to retire on 9 January 1986 at the age of 65 years. 

Since his retirement, the Veteran has not engaged in any paid employment.  Following his retirement, he moved to a banana plantation at Woolgoolga (on the north coast of New South Wales, about 25 kilometres north of Coffs Harbour) owned by his daughter and son-in-law.

There he did unpaid work for them, making banana packing cases and using a tractor to clear fire trails.  After being occupied in this way for some two years, the Veteran and his wife went to Canada for a holiday.  Immediately or shortly after their return, they moved into a retirement village at Woolgoolga where the Veteran did "handyman work".  He gave this evidence:

"I did what I was allowed to do.  There are a lot of strict rules with these retirement villages, especially then." (AB 92.01-03)

After living in the retirement village for four years, the Veteran bought a two bedroom cottage at Valla Beach near Nambucca Heads where they lived.  In relation to the cottage, he gave this evidence:

"I bought it in a run-down type of condition, I had a garage built on it, I put in paths and pergolas and all that sort of thing and built it up." (AB 92.23-.25)

Having sold the Valla Beach cottage at a profit in 1991 the Veteran purchased and moved into a better house at 38 Bower Crescent, Bayldon.   Bayldon was chosen because it was closer to Coffs Harbour, transport facilities and the Veteran's family.

PENSION HISTORY
It is common ground that in 1947 the Commission determined that a ganglion on the Veteran's left foot was war-caused; that no pension was paid; that the Commission subsequently determined that a migraine condition was war-caused; and that the Veteran "received a 10% pension, the minimum rate, with effect from 9 November 1951" (Commission's written submissions, para 2.1).

The Veteran's more recent pension history is somewhat complex.  On 20 May 1992 he lodged a claim for a disability pension in respect of skin cancers.  On 6 October 1992 the Commission determined that "solar skin damage" was war-caused and assessed the Veteran's pension at 40% of the General Rate with effect from 20 February 1992.

On 30 December 1992, the Veteran lodged an application for review by the VRB of the Commission's decision of 6 October 1992.

While that application for review was pending, on 18 January 1993 the Veteran lodged a claim for disability pension which led to a determination by the Commission dated 10 February 1994 that "generalised anxiety disorder with panic attacks, bilateral sensory-neural hearing loss with tinnitus and chronic airways disease" were war-caused and that the Veteran's pension should be increased to 60% of the General Rate with effect from 18 October 1992.

On 18 February 1994 the Veteran lodged an application for review by the VRB of the Commission's decision of 10 February 1994.

On 16 May 1994 the VRB decided the Veteran's application for review of the Commission's determination of 6 October 1992 which, it will be recalled, had assessed a pension at 40% of the General Rate with effect from 20 February 1992.  The VRB's decision was to set aside that determination of the Commission and to substitute a determination that pension be assessed at 40% of the General Rate with effect from and including 20 February 1992 and 60% of the General Rate with effect from 18 November 1992.  (The war‑caused disabilities which were included in the assessment were: "ganglion leftfoot, migraine, duodenal ulcer, solar skin damage, generalised anxiety disorder with panic attacks, bilateral sensorineural deafness with tinnitus, chronic airways disease" (AB 144).)

On 22 July 1994 the VRB set aside part of the Commission's determination dated 10 February 1994 and substituted an assessment of pension at 80% of the General Rate effective from 18 October 1992 in lieu of 60%. 

On 9 September 1994 the Veteran applied to the AAT for review of the VRB's decision dated 16 May 1994.  While the application to the AAT was pending, the Commission, on 24 October 1994, made a further determination increasing the Veteran's pension to 90% of the General Rate with effect from 18 October 1992. 

The application to the AAT was heard on 7 April 1995.  On 24 November 1995 it affirmed that part of the VRB's decision dated 16 May 1994 which had assessed the Veteran's pension at 40% of the General Rate with effect from 20 February 1992, but set aside that part which had assessed his pension at 60% of the General Rate with effect from 18 November 1992, and substituted for the latter a determination that he was entitled to a Special Rate pension with effect from 18 October 1992.

The Commission filed its notice of appeal to the Court on 22 March 1995 seeking an order setting aside the AAT's decision dated 24 November 1995 and an order affirming the VRB's decision dated 16 May 1994, or, in the alternative to the latter, an order remitting the matter to be heard and decided by the AAT in accordance with law.  The Commission has made it clear that in the event that it succeeds, it does not seek an order for costs against the Veteran.

LEGISLATION
The issues debated on the appeal turn upon the proper construction and application of para 24 (1) (c) of the VE Act. Sub-section 24 (4) sets out, in simple terms, the "Special Rate pension" which is payable to a veteran to whom s 24 applies. The earlier, lengthier and more complex sub-sections ((1), (2A), (2B) and (3)) attempt to identify those veterans to whom s 24 applies. Sub-section 24 (1) provides that s 24 applies to a veteran if, inter alia,

"(c)the veteran is, by reason of incapacity from ... 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; ..."

The issue thrown up by para (c) in the present case is whether the Veteran was, by reason of his war‑caused disabilities, "alone, prevented from continuing to undertake remunerative work that the veteran was undertaking".

REASONING
A concession made by the Veteran on the hearing of the appeal has narrowed the issues.  The Veteran accepts that the work referred to by the AAT at paras 28 and 29 of its Reasons for Decision (see below), namely "work as a handyman, either on a banana plantation or elsewhere" was not work for which the Veteran had been remunerated and did not satisfy the description "remunerative work that the veteran was undertaking" in para 24 (1) (c).  The Veteran conceded that:

"Any determination that the [Veteran] is entitled to a pension at the special rate based solely on work as a handyman or in a banana plantation (other than as demonstrating a motivation to work) is erroneous" (Veteran's outline of argument, para 1)

The Veteran submitted, however, that this concession is not fatal to his claim; that it is implicit in the AAT's reasons for decision that he could, and would, have obtained work as a clerk, but was prevented from doing so by his war-caused disabilities alone; and that this implicit finding of the AAT had entitled him to succeed before it in any event.

This submission requires that attention be given to paras 25-30 of the AAT's Reasons for Decision.  They are as follows:

1. The Tribunal finds that the Applicant was a highly motivated individual and this was illustrated by his achievements at Telecom and its predecessor and his motivation to work on his daughter's banana plantation immediately after retirement.  His enthusiasm and ability in performing general handyman jobs has been demonstrated despite his war‑caused disabilities.  This, of course, was not remunerative work, and in the light of the nature and extent of his war‑caused
   disabilities we find that it would be unreasonable for the Applicant to anticipate that he could have obtained remunerative work at his daughter's plantation or renovating other people's houses.  However, in putting the hypothetical question to the Applicant, as it was identified by the Federal Court Re Maley, he was asked by his Counsel -

"... if you had not had your war caused disabilities ..., after your retirement from Telecom, what do you think you would have done?

The Applicant replied -

'Possibly after I'd had the holiday in Canada I would've been looking for something to do.  I would have been looking for possibly clerical work if I could've got it, but if not I was pretty handy with the handyman jobs, assistance to plumbers of electricians, things like that, painting'.

1. Although on the face of it the Applicant could be interpreted to be saying merely that it was possible (as distinct from probable) that he would have pursued work of the nature he specified, when put in the context of his demonstrated motivation for productive (but not remunerative) activity despite his war‑caused disabilities, the plans which he identified should, we find, be given significant weight.  At the hearing he was not asked to clarify what he meant by 'possibly'.

1. The Applicant acknowledged that he had no computing skills, and we note that in the eleven years between his retirement and the application date the computerisation of pay clerk work has been significant.  While this would reduce his chances of work as a pay clerk we take judicial note that there is plenty of other clerical work available which does not require computer skills.  In any event, we give little weight to his plans for clerical work following his retirement from Telstra, because that was not the area where he actually demonstrated his post‑retirement productive (but not remunerative) activity.

1. Taking the evidence as a whole we are reasonably satisfied that the Applicant would have obtained remunerative work as a handyman, either on a banana plantation or elsewhere, after he returned from Canada following his retirement, and that at the application date he would still have been undertaking that remunerative work in excess of twenty hours per week.  We say 'in excess of twenty hours per week' because we note his evidence that he worked making packing cases on his daughter's plantation for approximately twenty hours per week, notwithstanding his disabilities and his need to take frequent breaks from that work.

1. We find that it was not practical for the Applicant to seek work of this nature, notwithstanding that it was doing such work for his daughter and later for himself, because he was unable to undertake it in a commercially viable manner because of the effects of his war‑caused disabilities.

1. The Tribunal finds that, pursuant to paragraph 24(1)(c), at the application date it was the Applicant's war‑caused disabilities alone which prevented him from continuing to undertake remunerative work that he was undertaking and, by reason thereof, he was suffering a loss of salary or wages or earnings on his own account that he would not be suffering if he was free of his accepted disabilities." (emphases supplied)

The parties seemed to accept on the hearing that "clerical work" was an appropriate description of the "remunerative work that the veteran was undertaking".  The Veteran points to the evidence which he gave and which is quoted in the above extract from the AAT's reasons, and, in particular, to the reference in that evidence to clerical work, and to the succeeding paragraphs in which that evidence is discussed by the AAT.

To the extent that any question of the Veteran's engaging again in clerical work may have borne upon the AAT's thinking, it was, in my view, put to one side by the final sentence in para 27:

"In any event, we give little weight to his plans for clerical work following his retirement from Telstra, because that was not the area where he actually demonstrated his post-retirement productive (but not remunerative) activity."

In my view, there is no implicit finding by the AAT that the Veteran was, by reason of his war‑caused disabilities alone, prevented from continuing to undertake clerical work.  At most, paras 26 and 27 of the AAT's Reasons for Decision constitute a statement that the Veteran's evidence about clerical work should be accepted as a statement of what his actual intention had been and a rejection of the view that his clerical skills were so outdated as to disqualify him entirely from performing usefully any kind of contemporary remunerative clerical work.  This falls far short of a finding that the Veteran was in fact prevented by his war‑caused disabilities alone from undertaking such work.

This issue was not resolved by the AAT because of its erroneous view that it sufficed that the Veteran was, by reason only of incapacity of the relevant kind, prevented from undertaking remunerative work as a handyman.

For the foregoing reasons, the appeal must succeed.

The Commission raised a second ground of appeal which was expressed as follows in its notice of appeal:

"4.2The Tribunal erred in law by failing to give proper, genuine and realistic consideration of the fact that the Respondent was 71 years of age on the earliest date on which he might meet the requirements of section 24(1)(c) of the Veterans' Entitlements Act 1986 and had been out of the workforce from the age of 60."

The Commission's submission in support of this ground draws attention to the fact that the Veteran was 71 years of age at the application date.  The Commission relies on a passage from the joint judgment of Davies and Ryan JJ in Repatriation Commission v Strickland (1990) 22 ALD 10 (FCA/FC) ("Strickland").  The passage (at 17) is as follows:

"In the course of its reasons, the AAT referred on several occasions to age 65.  Having read these several references, the trial judge considered that the AAT had raised the age of 65 to the status of a cut-off point, or at least a balancing point, and had wrongly treated the respondent as being required to displace an assumption that a person over 65 would not normally be gainfully employed.  We do not find in the AAT's reasons the error which the trial judge thought to exist.

Age 65 was not an irrelevant matter.  It is a common retiring age for employees and can be taken to reflect somewhat arbitrarily the community's general understanding of the effect of age upon ability to undertake gainful employment.  Thus, as the Tribunal said, 65 years is the age at which a male person qualifies for the grant of an age pension.  It follows that, if nothing more were known of an applicant for a pension than that he was over the age of 65 years when the application was lodged, a tribunal would not be likely to be satisfied that the veteran was then suffering a loss of earnings by reason only of his war-caused incapacity.  Of course, that is only a hypothetical case and, invariably, more is known about the matter than that, as it was in the present case.  But the point is that a tribunal, especially a tribunal which deals with issues of this nature regularly, might reasonably proceed from the premise that applications for pension made after that age would fail, unless facts were disclosed which tended to the conclusion that the veteran would then still be continuing to undertake remunerative work, but for his war-caused incapacity."

In the present case, the Commission's submission to the AAT based on the Veteran's age of 71 years at the application date was noted in para 21 of the AAT's Reasons for Decision and the AAT's treatment of the submission appears in para 21 and the first sentence of para 22, as follows:

1. The Respondent also contended that at the application date the Applicant was 71 years of age and even without his war-caused disabilities it was not necessarily the case that he would have been able to undertake remunerative work at that age.  It was submitted that at the application date the Applicant had not engaged in remunerative work for 11 years and had not attempted to find any such work and his time out of the workforce meant that he was not prevented by his accepted disabilities alone from engaging in remunerative work.

1. The Tribunal takes judicial notice of the fact that there are in our society perfectly healthy and robust seventy one year old persons some of whom are still in full time work."

The Commission submits that a fair reading of these paragraphs reveals that the AAT did not give genuine consideration to the matter mentioned by Davies and Ryan JJ in Strickland and that its failure to do so constitutes an error of law.  I do not accept the submission.

The first of the two paragraphs quoted earlier from Strickland makes it clear that the relevant error of law propounded in that case was that the AAT had overemphasised the age of 65 years to the extent of elevating it to a "cut‑off point, or at least a balancing point".  The trial Judge agreed that the AAT had erred by setting up a "notional hurdle" at age 65 and assuming that it was the applicant who had to jump it.  The Full Court did not find in the AAT's reasons the error found by the trial Judge.

In rejecting the Commission's submission, the Full Court indicated why an age in excess of 65 years might properly be regarded as working against an applicant's case.  It must be emphasised that when the Full Court went on to address a situation in which nothing more was known than that a veteran's age exceeded 65 years, it was addressing what it described as "only a hypothetical case", in order to make its point.  As the Full Court observed, "invariably, more is known about the matter than that".  I cannot conceive of a case in which there would be no evidence relevant to the issue of capacity to continue to undertake remunerative work other than the fact that the veteran's age exceeded 65 years.  At least the veteran's actual age, and therefore the extent to which it exceeded 65 years, would be known.  The older the veteran, the more significant his or her age for the issue of capacity. 

I will assume, without deciding, that a result of what the Full Court said in Strickland is that in a hypothetical case in which there is no evidence relevant to capacity other than the fact that at the application date the veteran was one day older than the "standard" retirement age, a decision-maker must find against the veteran (the Full Court did not express itself as laying down such a rule).  In practice such a case would never arise.  The operation of any such presumptive rule in the case of a person who had just passed the standard retirement age would be swiftly displaced by, for example, evidence that he or she had been effectively undertaking remunerative work down to that age.  I do not find it useful to resolve the present question by reference to a presumptive rule which, if it exists, could have scope for operation only in an unreal hypothetical forensic situation.

The AAT was, however, bound to give real consideration to the factor that the Veteran was, at the relevant date, 71 years old, that is to say, six years older than the standard retirement age.  Is it shown that it did not do so?  I think not.  In referring to the existence of 71 year old persons still in full time work, the AAT was not denying all weight to the Veteran's age.  Rather, it was merely correctly observing that the fact that the Veteran's age exceeded the standard retirement age by six years should not necessarily carry the day against him.  It may be that the AAT did not give the factor of the Veteran's age of 71 years the greater weight that could also reasonably have been given to it by a different decision-maker, but this is not an error of law.

CONCLUSION
The appeal will be allowed, the decision of the AAT dated 16 May 1994 set aside and the case remitted to the AAT to be heard and decided again in accordance with law, and, in particular, in conformity with these Reasons for Judgment.

I certify that this and the preceding 15 pages are a true copy of the Reasons for Judgment of the Honourable Justice Lindgren.

Associate:

Dated:16 October 1996

Heard:       4 October 1996

Place:       Sydney

Decision:     16 October 1996

Appearances:  Ms R M Henderson of counsel instructed by the Australian Government Solicitor, appeared for the applicant.

Mr I R Sanderson of counsel instructed by Vardanega Roberts, solicitors, appeared for the respondent.