Trade Practices Commission v CSR Ltd
[1990] FCA 521
•21 SEPTEMBER 1990
Re: THE REPATRIATION COMMISSION
And: NOEL DEAN STRICKLAND
No. V G340 of 1989
FED No. 521
Veterans' Entitlements
12 AAR 343
22 ALD 10
COURT
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
Davies(1), Jenkinson(2) and Ryan(1) JJ.
CATCHWORDS
Veterans' Entitlements - s.24(1)(c) of the Veterans' Entitlements Act 1986 - whether account taken of the general retiring age for employees of 65 years in deciding whether a self-employed veteran would still have been undertaking remunerative work but for his war-caused injury involved an error of law.
HEARING
MELBOURNE
#DATE 21:9:1990
Counsel for Applicant: Dr C. Jessup, QC and Mr N.J.D. Green
Solicitors for Applicant: Australian Government Solicitor
Counsel for Respondent: Mr S.P. Gebhardt
Solicitors for Respondent: Bullards
ORDER
1. That the appeal be allowed.
2. That the order of Woodward J. of 26 October 1989 be set aside and, in lieu thereof, that the application to the Court be dismissed with costs.
3. That liberty be reserved to apply with respect to the costs of the appeal.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
This appeal raises an issue as to the application of s.24(1) of the Veterans' Entitlements Act 1986 ("the Act") which provided (as far as is relevant):
"This section applies to a veteran, other than a veteran to whom section 25 applies, if-
(a) there is in force in respect of the veteran a determination under this Act determining that the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is 100 per centum;
(b) the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and
(c) the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity."
The respondent who was born on 10 December 1917, had been seriously wounded on active service during World War II. After his discharge from the Army in 1943 a Repatriation Board assessed at 50% the degree of disability resulting from his wounds. Accordingly, he was granted a pension under the Repatriation Act 1920 at the rate of 50% of the General Rate. In 1975 a condition of diabetes mellitus from which he was found to be suffering was accepted as being service-related. As a result the rate of his pension was increased to 70% of the General Rate. Subsequently other medical conditions were also accepted as service-related and the respondent's rate of pension was increased to 100% of the General Rate.
On 16 January 1986 the respondent applied for his rate of pension to be increased to either the Special (TPI) Rate or the Intermediate Rate. The Repatriation Commission refused that application. The respondent then applied to the Administrative Appeals Tribunal ("the A.A.T.") for a review of that decision.
In 1944 the respondent in partnership with a Mr Clarke established a wholesale electrical business, a principal activity of which was acting as Victorian agent for "Honeywell" micro switches. Shortly afterwards, a company, Clarke-Strickland Pty Ltd., was formed to carry on the business.
In its reasons for decision dated 3 March 1989 rejecting the respondent's application for review, the A.A.T. summarized as follows the respondent's commercial activities to the time of his retirement in 1974:
"By the 1960s the company was employing a staff of nine, including the applicant and Mr Clarke. Mr Clarke looked after the technical side of the business while the applicant kept the accounts and the company's records. He had received no formal accounting training but had learned how to keep the accounts in the course of running the business. When other staff were not available to handle enquiries by telephone or over the counter, he also dealt with those enquiries; as a result he obtained some technical knowledge, although he never became a technical expert. Essentially his role throughout remained that of maintaining all the records of the business and keeping the accounts. In 1970 the New South Wales agent for Honeywell micro switches offered to buy all the shares in the company, which were owned equally by the applicant and Mr Clarke. Mr Clarke was in favour of selling; the applicant was not. They agreed that the applicant would buy Mr Clarke's shares and he did so for $20,000. Thereafter, he controlled the company until he sold all his shares to the New South Wales agent in
1974. He was then aged 56. He has not been employed or engaged in business on his own account since then."
The circumstances surrounding the respondent's retirement from his business in 1974 are recounted in this way in paragraphs 15 and 16 of the A.A.T.'s reasons for decision:
"15. The applicant gave evidence that he had been finding the work of running his company increasingly arduous. He lacked technical expertise and had to rely on his foreman, with whom he had a number of disagreements. He was feeling poorly and lethargic, which made it more difficult to do quickly and accurately the record and book-keeping work. In about April 1974, he said, he had been approached by a firm of accountants who had told him that one of their clients was interested in buying his business. The client turned out to be the New South Wales Honeywell micro switch agent. After negotiations the applicant decided to accept its offer to sell all his shares in the company. He was paid $38,500 for them, he said, and the company paid him approximately $40,000 as a director's retiring benefit. The sale was completed in June 1974 but the money was paid to him over a period of three or four years from then.
16. We accept the applicant and his wife as truthful witnesses. We have no doubt that the only reason why, having declined to sell his shares in the company in 1970 and having bought all the other shares in it then, he decided to sell all of them in 1974 was that he had found that he was no longer able to cope with the work involved in running the company. We are satisfied that the only reason why he was no longer able to cope with doing so was the effects which his inadequately controlled diabetes was having on his health."
After reviewing the other ailments which afflicted the respondent between 1974 and 1985, the A.A.T. concluded that:
"we have no doubt that on 16 January 1986 when the applicant lodged his application for the increase in the rate of his pension, his war-caused wounds and diseases on their own totally incapacitated him for work. Consequently on 16 January 1986 he met the criterion set by paragraph
(b) of section 24(1) of the Veterans' Entitlements Act. As the rate of his pension had been increased to 100% in September 1983, he also met on that date the criterion set by paragraph (a). All that was very properly conceded by Mr Smith. What is in issue, therefore, is whether on that date or at any time since, by reason of the applicant's being prevented by incapacity from his war-caused injuries and diseases from continuing to undertake remunerative work, he was suffering a loss of salary or wages, or of earnings on his own account, that he would not have been suffering if he had been free of that incapacity. We have found that he ceased to engage in remunerative work only because of his incapacity from his war- caused diseases; so paragraph (a) of section 24(2) is not applicable. Two questions, therefore, remain to be answered. The first is whether the applicant continued to be totally incapacitated throughout the period from June 1974 until 16 January 1986 so that he can be held to have been prevented from continuing to undertake remunerative work (see Re Repatriation Commission and McCartney (1986) 9 ALD 441). The second is whether he would have been suffering the loss of salary or wages, or of earnings on his own account, on 16 January 1986 or at any time since then if on that date he had been free of that incapacity."
Having thus identified, as it saw them, the remaining issues involving the application of s.24(1)(c), the A.A.T. resolved the first issue in favour of the respondent, saying:
"In respect of the first issue, the evidence is that the applicant possessed no skills other than those which he had acquired in running his business. They were skills in book-keeping and in maintaining the company's records of orders, invoices and correspondence and some technical knowledge relating to micro switches. He was 56 years old when he sold his business. Because he had no formal qualifications in book-keeping or accountancy it is unlikely that at his age he would have been able to obtain employment in the field of book-keeping or doing work relating to micro-switches. There is no doubt that his diabetes was by then starting to have an effect on his vascular system. Even if he had not been suffering from diabetes and the other conditions referred to in the Royal Melbourne Hospital report, the wound to his knee would have prevented him doing labouring work or any other work which put a strain on the knee. We are satisfied that he could not have worked in any job except one where he could sit for most of the day. Also he could not have worked in a job which prevented him from having his meals regularly at the proper times. We are satisfied, therefore, that the only work which he could have done after June 1974 if he had not been incapacitated by his war-caused injury and diseases was running the business which he had established, or possibly just keeping the records and books of the company. That, however, he was prevented from doing by his war-caused diseases. We have come to the conclusion, therefore, that he was prevented from continuing to undertake remunerative work by reason of incapacity from his war-caused diseases alone."
However, the A.A.T. went on to decide what it called "the second issue" adversely to the respondent. Its findings of fact relevant to that issue and the inferences which it drew from the facts so found have been the focus of attention of this appeal and it is desirable to reproduce them in full:
"On 16 January 1986, which is the earliest date at which we may test whether he met the criterion set by paragraph (c) of section 24(1) of the Veterans' Entitlements Act, he was 68 years old. Mr Smith submitted that, even if he had not sold his business in 1974, it was unlikely that he would have continued to work after the age of 65 years. Mr Gebhardt pointed out that many persons in the community do work after the age of 65, particularly persons who are self-employed. We accept that that is true. However, no evidence was placed before the Tribunal either of the applicant's intention at any time to work after attaining the age of 65 or even of the proportion of self-employed persons who work beyond that age.
21. The only evidence of the applicant's intention was given by him in answer to a question about the life insurance policy which he took out in January 1959. He said that the policy matured on his reaching the age of
65. Mr Smith tendered a letter from the State Manager of the insurance company to the effect that a policy had matured on the applicant's 65th birthday; it is not clear from that letter whether the policy referred to in it was the one issued in 1959. However, the applicant's own evidence is that the policy taken out at that time did mature then. While on its own that might not have indicated his intention in 1959 as to retirement, when asked when he had then expected to retire, he said that he had thought that he would do so at the age of 65 or one or two years later. Although that was expressed in rather vague terms, it indicates that in 1959 the applicant, to the extent that he had formed an intention when he would retire, had in mind that it would be at the age of 65 or very soon thereafter. He gave no evidence of any change of that intention; nor indeed was he asked expressly about that. The fact that be bought out Mr Clarke's interest in the company in 1970 cannot be taken as indicating that he intended to continue in the business after the age of 65. In June 1970 he was 52 years old; a period of 12 years had still to elapse between then and his reaching the age of 65. All that his purchase of Mr Clarke's shares in 1970 indicates is that he did not wish to retire at the age of 52.
22. As already observed, we are required to decide this matter to our reasonable satisfaction, that is to say on a balance of probabilities. We note that attainment of the age of 65 qualifies a male person for the grant of an age pension. As a person whoserved overseas in the Army during the Second World War the applicant was entitled to be granted a service pension five years earlier. His family circumstances were such that he could have retired, and have intended to do so, at the age of 65 without suffering severe financial hardship. At least after 1970 his work for his company involved very long hours, much beyond the normal working hours of employees. While some persons over the age of 65 may revel in working such long hours, the fact that he would have had to go on working such hours is a factor to be considered in deciding whether or not, on a balance of probabilities, he would have continued to work after that age.
23. In the absence of any evidence by him that he ever intended to work for long after he attained the age of 65 years, and in the absence of any evidence that a majority of persons running small companies such as his continue to do so after the age at which they become eligible for an age pension, such evidence as there is as to the applicant's intentions and the evidence as to the very long hours which he had to work to maintain the business lead us to conclude on the balance of probabilities that he would not still have been running it in January 1986 if he had not been obliged by his war-caused diseases to cease doing so in 1974. We are satisfied that by January 1986 he would not have been receiving any other salary or wages or earning money on his own account in any other way.
24. Accordingly, we have decided that on 16 January 1986 he was not, by reason of his incapacity from his war-caused injuries and diseases, suffering a loss of salary or wages, or of earnings on his own account, that he would not have been suffering if he had been free of that incapacity, and that he has not done so at any time during the period from then until now. He, therefore, fails to meet the criterion set by paragraph (c) of section 24(1) of the Veterans' Entitlements Act and is not qualified for the Special Rate of pension. As the same criterion is set by paragraph (c) of section 24(1), he is also not qualified for the Intermediate Rate. Accordingly, his claim must be dismissed."
Mr Strickland appealed to this Court pursuant to s.44 of the Administrative Appeals Act against that dismissal of his application to the A.A.T. As amended, the questions of law and the grounds of appeal raised by the respondent were:
"QUESTIONS OF LAW
1. Was the Tribunal entitled to take into account an inference of fact on a matter:
(a) not put to the Applicant when giving evidence;
(b) not the subject of submissions?
2. Did the Applicant have the evidentiary onus of proving that he would have continued to work after the age of 65 years? GROUNDS
1. That the Tribunal erred in law in that it misinterpreted and misconstrued Section 24(i)(c) of the Veterans' Entitlements Act 1986.
2. That the Tribunal erred in law in that the Respondent should have had the onus of proving the facts relevant to the Appellant's intention not to work after the age of 65 years."
The learned Judge who heard the appeal at first instance accepted a submission by Counsel for Mr Strickland that the A.A.T. gave undue emphasis to the attainment of the age of 65, noting that "there is certainly nothing in the relevant paragraph of the Act which directs special attention to that age". After referring to an expression of opinion by the A.A.T. that had Mr Strickland applied in 1983 "he would have been likely to have been granted a pension then at the Special (TPI) Rate" and noting that Mr Strickland turned 65 in December 1982, his Honour continued:
"It follows that the Tribunal believed that the balance of probabilities of his continuing remunerative work swung against the applicant some time in 1984 or 1985. This was a very fine line to draw and must have been based largely on the Tribunal's reference to a single passage in the evidence covering the last three questions in Mr Strickland's cross-examination.
These were as follows:
`Just one final question, Mr Strickland. You referred to the insurance policies and indicated that they matured at 65 years of age. Why at 65?...Well, I am not a great believer in going to full life and retirement was the general accepted thing at that time. So when the insurance policy - sorry?...So when the insurance policy was at retiring age, although being self employed I could have gone on for another 12 months or two years had I wanted to. All right. So, when the insurance policies were taken out, it was on your mind to retire at 65 or soon after?...Yes, I think so.' It is clear that the reply to the first question was a reference to different types of insurance; it did not convey anything about retirement intentions. The answers to the second and third questions, however, suggested that when the policies were taken out in 1959 (the applicant then being 41 years old) he had in mind that he would probably retire somewhere between 65 and 67 years of age."
After noting the A.A.T.'s statement in paragraph 2 of its reasons which is reproduced above, that the respondent "gave no evidence of any change of that intention (to retire at the age of 65 or very soon thereafter); nor indeed was he asked expressly about that", his Honour quoted from paragraph 23 of the A.A.T.'s reason which we have also reproduced. He then said:
"In my view each of the reasons given for the Tribunal's finding is flawed. In the first place, what evidence could the applicant usefully have given about his pre-injury retirement intentions? He went away to war at the age of 22, having done a series of unskilled jobs after leaving school. He was seriously injured at El Alamein when he was 24. What thought would he have given to his probable age of retirement before that occurred?
After that, any thoughts he might have had about retirement must have been affected by that injury, for which he was granted a 50% disability pension in 1943. At the time he sought insurance cover in 1959 he discovered that he was suffering from diabetes mellitus, which many years later was held to be service-related. In the intervening years between 1943 and 1959, he had been building up a successful wholesale electrical business, in partnership with another man, in spite of these disabilities. Thus when he took out his insurance he was already seriously affected by his war injuries. Any view he may then have formed about the likely age of his retirement must have been influenced by those injuries. This point seems to have been overlooked by the Tribunal in relying on `such evidence as there is'. This is the second flaw.
Thirdly, how could the applicant be expected, as apparently he was, to produce evidence that `the majority of persons running small companies such as his' continue to do so after 65? And if that evidence had been available, how much reliance could be placed upon it? Each case much depend upon its own facts - such as the character of the individual, his or her surrounding circumstances and state of health, the nature and the profitability of the business and whether it can readily be sold as a going concern. Beyond this, the Tribunal must use its own knowledge of human and business affairs. It might receive some assistance from statistics but, in my view, not very much. What `the majority' of persons running small companies might do, as distinct from a substantial number of such persons, is not to the point. In the present case the Tribunal considered some of the factors I have mentioned above, but not all. In particular it seems not to have taken into account the applicant's apparently strong independent spirit which kept him working profitably through considerable adversity, overcoming disadvantages of a limited education and his war-caused disabilities.
Finally, one factor it did take into account was the arduous nature of the work involved in managing the business. But it did not consider the possibility that the applicant might have continued with a limited role in the business - perhaps selling some or all of his interest in it to another, but continuing to work shorter hours as book-keeper and helping to maintain the goodwill."
The learned trial judge acknowledged the difficulty of deciding whether there had been any error of law by the A.A.T. and summarized as follows the arguments advanced on behalf of Mr Strickland:
"The first was, as counsel explained in argument, designed to draw attention to the Tribunal's emphasis on the age of 65 which, he submitted, the Tribunal had in effect imported into the relevant paragraph of s 24 of the Act.
The second was that, having raised the age of 65 to the status of a cut-off point, or at least a balancing point, the Tribunal had wrongly treated the applicant as being required to displace the assumption that a person over 65 would not normally be gainfully employed."
His Honour then concluded:
"Although I am reluctant to reach a finding adverse to the Tribunal, which obviously approached its difficult task with care, I am persuaded that there is sufficient in the two arguments of the applicant set out above to establish, between them, an error of law. The Tribunal did place great weight on the applicant's having passed the age of 65 - noting that that is the usual age for a male person to qualify for an age pension, but at the same time acknowledging the significant fact that the applicant would have qualified for a service pension at 60. It also placed great weight on the evidence about the applicant's thoughts when taking out an insurance policy which matured at 65. For the reasons already given, I believe this reliance was misplaced in view of the applicant's war-caused condition of health at that time.
Having set up this notional hurdle at age 65, the Tribunal does seem to have assumed that it was the applicant who had to jump it. It was clearly influenced by the `absence of any evidence by (the applicant) that he ever intended to work for long after he attained the age of 65 years', and of `any evidence that a majority of persons running small companies such as (the applicant's) continue to do so after the age at which they become eligible for an age pension'.
I think the Tribunal did, consciously or unconsciously, regard the applicant as having an evidentiary onus of establishing that he would have worked beyond the age of 65; it was not merely commenting on the lack of material on which it could be satisfied of that fact. There was no reason to be found, either in the statute or in the established facts, why the applicant should have had to bear any such onus. In acting on the contrary view the Tribunal, I believe, crossed over the boundary between, on the one hand, the selection and weighting of factors to be considered and, on the other, misdirecting itself on a question of law in a way which vitiates its findings. It was satisfied by the applicant's evidence concerning the time when he took out his insurance policy, that he would have worked to 66, or perhaps 67, but not to the age of 68 and two months. As I have said earlier, I find the reasons given for this fine distinction unconvincing, but that is not to say that further reflection could not produce the same result; and so the appropriate order is that the question in dispute be remitted to the Tribunal for further consideration in accordance with these reasons. I do not believe that any further evidence would assist the Tribunal, but I shall not pre-empt any decision the Tribunal might care to make on that subject."
The task which confronted the A.A.T. was a difficult one. The respondent had lodged his application for a pension under s.24 of the Act on 16 January 1986, when he was 68 years of age. To order that a pension be granted under that section, the A.A.T. was required to be satisfied, as a matter of reasonable satisfaction, that the respondent was then, by reason of his incapacity from war-caused injury or war-caused disease, or both, prevented from continuing to undertake remunerative work that he had been undertaking and was thereby suffering a loss of salary or wages or of earnings on his own account that he would not have been suffering if he were then free of that incapacity. That requirement obliged the A.A.T. to investigate what is, in certain respects, a highly artificial complex of facts. It had to take account of remunerative work which the veteran had actually been undertaking (and in which he might not have engaged at all but for his war-caused injury) and then to speculate whether the veteran would, at a given date, have still been deriving a certain level of remuneration from that work had it not been for the war-caused injury. In the present case, the respondent had not been gainfully employed since 1974 when he had sold his shareholding in Clarke-Strickland Pty Ltd., a manufacturer of Honeywell micro switches, to the New South Wales agent for Honeywell. Apart from the respondent's age, the facts scarcely pointed one way or the other as to whether he would have been gainfully employed in January 1986, absent his war-caused incapacity.
In the course of its reasons, the A.A.T. referred on several occasions to age 65. Having read these several references, the trial Judge considered that the A.A.T. 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 A.A.T.'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.
Of course, age 65 is not an age which is directly applicable to a person who is running his own business or who controls the affairs of a company which conducts the business in which he is engaged. But that is not to say age is irrelevant to such a person. For example, the respondent established Clarke-Strickland Pty Ltd. with a Mr Clarke, who was the technical expert. Mr Clarke sold his shares to the respondent and left the business in 1970. The respondent was then left to manage the business, which was in a technical field. This could not have been an easy task. Moreover, Honeywell's New South Wales agent wished to acquire the business. It had offered to do this in 1970 and it was successful in acquiring Clarke-Strickland Pty Ltd. in 1974. The facts do not tend, on balance, to the conclusion that the respondent would or could have continued to derive income from the business without Mr Clarke's assistance as long as he wished, or at least until he had reached 68.
The A.A.T. concluded that, after 1970, the respondent's work involved very long hours, much beyond the normal working hours of employees and that this was a factor which it should take into account in deciding whether or not the respondent would have continued to work to age 68. The A.A.T. also took into account that, because of his family circumstances and his pension entitlements, the respondent could have retired by age 65 without suffering severe financial hardship. The A.A.T. concluded, on the balance of probabilities, that, even without his war-caused incapacity, the respondent would not have continued running the business of Clarke-Strickland Pty Ltd. or otherwise deriving income until 1986. In our opinion, this finding of fact was reasonably open to the Tribunal.
We would allow the appeal, would set aside his Honour's order and would substitute therefor an order that the application to the Court be dismissed with costs. We would reserve liberty to apply with respect to the costs of the appeal.
JUDGE2
The circumstances upon which the decision of this appeal depends are set out in the reasons for judgment of Davies and Ryan JJ., which I have had the advantage of reading.
On the question whether the learned trial judge's discernment of the Tribunal's raising of "an evidentiary onus of establishing" that the respondent would have worked beyond the age of 65 was correct, I agree with the conclusion of Davies and Ryan JJ. that it was not.
The learned trial judge thought a number of the reasons given by the Administrative Appeals Tribunal for its decision to be flawed. But they were reasons for a finding of fact, "hypothetical fact", as Beaumont J. called the question posed by s.24(1)(c). (Repatriation Commission v. Smith (1987) 74 ALR 537 at 548.) The nature of the question naturally evokes reliance by the fact finder on his or her beliefs about "normal" or common human psychological mechanisms and "normal" or common human behavioural responses in the face of circumstances of the kind under consideration, to a greater extent than is usual when the question is one of historical fact. Unless the content of a belief is such as could not reasonably be entertained, or unless the use of a belief in reasoning is such as could not reasonably be made, disagreement with the fact finder's beliefs or with his use in reasoning of his beliefs does not establish error of law. And, as the learned trial judge acknowledged by quoting the statement, "(t)here is no error of law simply in making a wrong finding of fact" (per Brennan J. in Waterford v. The Commonwealth (1987) 163 CLR 54 at 77.) Nor in my opinion is there necessarily any error of law in reaching the finding of fact by recourse to beliefs about human behaviour which the appellate court does not share or by reasoning which the appellate court thinks erroneous. In Australian Broadcasting Tribunal v. Bond (1990) 64 ALJR 462 at 477 Mason C.J. gave a brief statement of what his Honour regarded as the effect of the authorities in this country at present:
"The question whether there is any evidence of a particular fact is a question of law: McPhee v. S. Bennett Ltd (1934) 52 WN (NSW) 8 at 9; The Australian Gas Light Co. v. The Valuer-General (1940) 40 SR (NSW) 126 at 137-138. Likewise, the question whether a particular inference can be drawn from facts found or agreed is a question of law: Australian Gas Light, at 137-138; Hope v. Bathurst City Council (1980) 144 CLR 1 at 8-9. This is because, before the inference is drawn, there is the preliminary question whether the evidence reasonably admits of different conclusions: Federal Commissioner of Taxation v. Broken Hill South Ltd. (1941) 65 CLR 150 at 155, 157, 160. So, in the context of judicial review, it has been accepted that the making of findings and the drawing of inferences in the absence of evidence is an error of law: Sinclair v. Maryborough Mining Warden (1975) 132 CLR 473 at 481, 483. But it is said that "(t)here is no error of law simply in making a wrong finding of fact": Waterford v. The Commonwealth
(1987) 163 CLR 54, per Brennan J, at 77. Similarly Menzies J. observed in R. v. The District Court; Ex parte White (1966) 116 CLR 644 at 654:
`Even if the reasoning whereby the Court reached its conclusion of fact were demonstrably unsound, this would not amount to an error of law on the face of the record. To establish some faulty (eg illogical) inference
of fact would not disclose an error of law.'
Thus, at common law, according to the Australian authorities, want of logic is not synonymous with error of law. So long as there is some basis for an inference - in other words, the particular inference is reasonably open - even if that inference appears to have been drawn as a result of illogical reasoning, there is no place for judicial review because no error of law has taken place."
With that statement the other members of the Court expressed agreement, but in the case of Deane J. subject to qualification: see 64 ALJR at 482, 482-483, 492. Tested by reference to what that statement contains, the reasons of the Administrative Appeals Tribunal do not in my opinion disclose error of law.
In this case, however, one of the principal difficulties which the reasoning of the Administrative Appeals Tribunal caused the learned trial judge derived from the Tribunal's reluctance to rest its fact finding on any belief the members may have had about a particular human characteristic or habit in the Australian community. The Tribunal expressed its willingness to accept the suggestion by the respondent's counsel that many "self-employed" persons work beyond the age of 65 years, but indicated, in my opinion, by its references to the absence of evidence about the proportion of such persons who work beyond that age, its unwillingness in the particular instance to use in its reasoning to a finding any belief the members of the Tribunal may have held about the incidence of that behaviour in the Australian community. This in my opinion they were legally free to do. It will be observed that the reference in paragraph 23 of the Tribunal's reasons for decision to the absence of evidence about the incidence in the Australian community of the behaviour in question followed hard upon the Tribunal's references in paragraph 22 of those reasons to "a balance of probabilities" as controlling its factual determinations. The learned trial judge expressed the view that what a majority of persons, "as distinct from a substantial number of such persons", might do was "not to the point". It seems likely that the Tribunal thought the distinction very much to the point. That view could not be described as unreasonable: see Eggleston: Evidence, Proof and Probability, chs. 1-3, 9, 11.
I have not found in the Tribunal's reasons an indication of a misconceived evidentiary onus, but only a narration of the circumstances which left the Tribunal lacking reasonable satisfaction of the fulfilment of the condition specified in the second clause of s.24(1)(c).
I would allow the appeal, set aside the orders made by the learned trial judge and order that the appeal from the decision of the Administrative Appeals Tribunal be dismissed with costs. The appellant's costs of the appeal should be ordered to be paid by the respondent.
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