Walshe, V.J. v The Repatriation Commission

[1989] FCA 491

Re: VICTOR JAMES WALSHE AND THE REPATRIATION COMMISSION
And: THE REPATRIATION COMMISSION
Re: THE REPATRIATION COMMISSION
And: C.A. KEMP; N.R. CHARLESWORTH; B.T. EGAN AND G.L. COBBAN
Nos. NG329 and 261 of 1989
FED No. 491
Veterans' Entitlements

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Wilcox J.(1)

CATCHWORDS

Veterans' Entitlements - Amendment of legislation to provide new benefit, extreme disablement benefit - Availability of benefit in respect of period before commencement of amending legislation - Effect of provision designed to give some retrospective effect to amending legislation.

Veterans' Entitlements Act 1986 ss.19, 22.

Veterans' Affairs Legislation Amendment Act 1988 ss.2, 3, 10, 13, 14.

HEARING

SYDNEY

#DATE 28:8:1989

No. NG329

Counsel for the Applicant: Mr M Smith

Solicitors for the Applicant: Vandenberg Reid Pappas & MacDonald

Counsel for the Respondent: Ms R M Henderson

Solicitors for the Respondent: Australian Government Solicitor
No. NG261

Counsel for the Applicant: Ms R M Henderson

Solicitors for the Applicant: Australian Government Solicitor

Solicitors for the First,
Second and Third Respondents: Australian Government Solicitor

Counsel for the Fourth
Respondent: Mr M Smith

Solicitors for the Fourth
Respondent; Vandenberg Reid Pappas &

MacDonald

ORDER

No. NG 329 of 1989

The application for review be dismissed.
No. NG 261 of 1989

The application for review be allowed.

The decision of the Veterans' Review Board, constituted by the first, second and third respondents, on the application of the fourth respondent for an increased pension rate, dated 3 March 1989, be set aside and the said application be remitted to the said Board for determination according to law.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. (See also Order 37 rule 2(3)).

JUDGE1

These two cases, heard together by consent, raise but a single question: whether an "extreme disablement adjustment" may be awarded to veterans in respect of a period before the commencement of the amending legislation which introduced that benefit.

1. The Veterans' Entitlements Act 1986 commenced to operate on 22 May 1986. That Act retained the concept, familiar from its predecessor, the Repatriation Act 1920, of a general rate of pension awarded to veterans who suffer from war-caused injuries or war-caused diseases: see s.22 of the Veterans' Entitlements Act. The Act also provided for an intermediate rate of pension payable to a veteran whose incapacity is of such a nature as to render the veteran incapable of undertaking remunerative work otherwise than on a part-time basis or intermittently (s.23), for a special rate of pension payable where the veteran is totally and permanently incapacitated (s.24) and for a temporary payment at a special rate (s.25).

2. As originally enacted in 1986, the Veterans' Entitlements Act did not provide for any extra payment in cases where a veteran suffered from a disability which was particularly disabling but which did not occasion economic loss. With the increasing number of World War II veterans who had attained the usual retiring age, there were no doubt many persons in this category. Consequently, a committee appointed to review the operation of the 1986 Act, the Veterans' Entitlements Act Monitoring Committee, recommended to the Government that the Act be amended to provide for the payment of a general rate extreme disablement adjustment, based on an amount equal to 150% of the general rate, to veterans who met certain specified criteria. The Government accepted this recommendation. By s.13 of the Veterans' Affairs Legislation Amendment Act 1988 s.22 of the 1986 Act was repealed and two new sections were substituted. They were s.21A, which dealt with the determination of the degree of incapacity of a veteran, and s.22, which relevantly read as follows:
   

"22. (1) This section applies to a veteran who is being paid, or is eligible to be paid, a pension under this Part, other than a veteran to whom section 23, 24 or 25 applies.

(2) Subject to this Division, the rate at which pension is payable to a veteran to whom this section applies in respect of the incapacity of the veteran from war-caused injury or war-caused disease, or both, is the rate per fortnight that constitutes the same percentage of the general rate as the percentage determined by the Commission in accordance with section 21A to be the degree of incapacity of the veteran from that war-caused injury or war-caused disease, or both, as the case may be.

(3) For the purposes of this section, the maximum rate per fortnight is $143.50 per fortnight.

(4) Where:

(a) either:

(i) the degree of incapacity of a veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be 100% or has been so determined by a determination that is in force; or

(ii) a veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the maximum rate per fortnight specified in subsection (3);

(b) the veteran has attained the age of 65;

(c) the veteran has an impairment rating of at least 70 points and a lifestyle rating of at least 6 points, each determined in accordance with the approved Guide to the Assessment of Rates of Veterans' Pensions; and

(d) the veteran is not receiving a pension at a rate provided for by section 23, 24 or 25; the rate at which pension is payable to the veteran is increased by 50% of the maximum rate set out in subsection (3).

(5) . . ."

1. Section 2 of the 1988 Act dealt with the matter of commencement:
   

"2. Each provision of this Act commences, or shall be taken to have commenced, as the case requires, on the day shown by the note in italics at the foot of that provision. Commencement: Day of Royal Assent"

Section 3(1) read:

"3. (1) The amendments made by sections 5, 6, 7, 10, 11, 12, 13, 14, 15, 27 and 28 apply to determinations made under the Veterans' Entitlements Act 1986 on or after the day on which this Act receives the Royal Assent. Commencement: Day of Royal Assent"

The 1988 Act received Royal Assent on 22 December 1988.

1. The two matters now before the Court are applications made under the Administrative Decisions (Judicial Review) Act 1977. In one case, Walshe v Repatriation Commission, the application is brought by the veteran. The facts of that case have been agreed between the parties as follows:
   

"(i) Prior to October 1988 Mr Walshe received a veteran's disability pension at a rate of 100% of the general rate.

(ii) On 28 October 1988 he applied for an increase in pension, specifically seeking the extreme disablement adjustment.

(iii) On 22 May 1989 a delegate of the Repatriation Commission found that he satisfied all qualifications for the extreme disablement adjustment, and determined that it was payable with effect from 22 December 1988.

(iv) In so determining, the delegate acted upon the opinion that 22 December 1988 was the earliest date from which the adjustment could be paid in all circumstances.

(v) This application under the Administrative Decisions (Judicial Review) Act 1977

(Cth) challenges the determination upon the ground that the adoption of that opinion involved an error of law.

(vi) If the Court answers the question posed at 6 in the affirmative, then the decision should be set aside, and the matter remitted for further consideration by the respondent.

(vii) If the question is answered in the negative, the application should be dismissed."

The question posed in para.6 of this document was: "The sole question of law raised by these applications is whether, in making an assessment after 22 December 1988, a decision-maker had power to determine that a rate of pension increased by the extreme disablement allowance was payable in respect of a period prior to 22 December 1988."

1. The other proceeding is brought by the Repatriation Commission, challenging a decision of the Veterans' Review Board. The respondents to that application are the members of that Board, Messrs C A Kemp, N R Charlesworth and B T Egan, and a veteran, Mr G L Cobban. The members of the Board submit to the order of the Court. Mr Cobban contests the application. Once again the relevant facts have been agreed between the parties. They are as follows:
   

"(i) Prior to October 1987 Mr Cobban received a veteran's disability (sic) pension at the rate of 90% of the general rate.

(ii) He applied for an increase of pension on 30 October 1987.

(iii) On 22 June 1988, the Repatriation Commission refused his application.

(iv) On 18 July 1988 Mr Cobban applied for a review by the Veterans' Review Board of that determination.

(v) By a decision dated 3 March 1989 the Board decided 'to set aside the decision under review and substitute its decision that pension be assessed at ninety per cent of the General Rate to operate from and including 30 October 1987 and at one hundred and fifty per cent of the General Rate that is the Extreme Disablement Adjustment to operate from and including 20 October 1988'.

(vi) This application under the Administrative Decisions (Judicial Review) Act 1977

(Cth) challenges the Board's decision upon the ground that it erred in law by holding that payment of the extreme disability allowance could commence from a date prior to 22 December 1988.

(vii) If the Court answers the question posed at 6 in the negative, then the decision should be set aside, and the matter remitted to the Veterans' Review Board for further consideration according to law.

(viii) If the question is answered in the affirmative, the application should be dismissed."

1. The question posed in para.6 of the document is the question already quoted.

2. There is no doubt that Parliament intended that the new s.22 should have a measure of retrospectivity. Section 3(1) makes clear that this section is to apply to all determinations made on or after the date upon which the new section commenced; that is, 22 December 1988. Inevitably, some of those determinations would be made in respect of claims for pensions -- see s.14 of the 1986 Act -- or applications for increases -- see s.15 -- which were made before that day. Consequently, a person whose application was pending on that day might receive a benefit, the extreme disablement adjustment, which would not have been available at the time when the application was lodged. But the question is whether the decision-maker -- the Repatriation Commission, the Veterans' Review Board or the Administrative Appeals Tribunal, as the case may be -- is able to back-date an extreme disablement adjustment so as to make it apply prior to 22 December 1988.

3. The contention of counsel for the two veterans is that s.3(1) operates to apply all aspects of the new s.22 to determinations made on or after 22 December 1988. By way of analogy counsel refers to the decision of a Full Court of this Court in Delkou v Repatriation Commission (1986) 69 ALR 406. Mr Delkou had lodged a claim for a pension under the Repatriation Act as long ago as 1977. The Repatriation Review Tribunal held that he was entitled to a pension and the Repatriation Commission then set the pension rate at 20% of the general rate. Mr Delkou applied for review of that rate but various delays ensued and the matter was still unresolved on 1 January 1985, when the Repatriation Legislation Amendment Act 1984 came into operation. On 6 May 1985 the Repatriation Review Tribunal decided that Mr Delkou was entitled to a pension at the special rate, under Schedule 2 of the Repatriation Act. However, almost immediately thereafter Schedule 2 was amended so as to impose more stringent requirements for the grant of a special pension. The Commission sought review, by the Administrative Appeals Tribunal, of the decision of the Repatriation Review Tribunal and the question arose whether the amended provisions of Schedule 2 should be applied to the case. The Tribunal so held, and the Full Court affirmed that decision.

4. The decision in Delkou turned upon the terms of s.68 of the 1985 amending Act, which relevantly provided:
   

"68. (1) . . .

(2) The amendments of the Repatriation Act 1920 effected by . . . section 34 of this Act apply to and in relation to any assessment or re-assessment of the rate of a pension that is made by the Commission, by the Veteran's Review Board or by the Administrative Appeals Tribunal after the commencement of this Act.

(3) . . .

(4) Sub-sections (2) and (3) apply to the assessment or re-assessment of the rate of a pension whether the proceedings in relation to which the assessment or re-assessment is made commenced before, or commence after, the commencement of this Act."

It will be noted that s.68(2) of that Act was not unlike s.3(1) of the Veterans' Affairs Legislation Amendment Act 1988.

1. In its reasons for decision the Full Court referred to the explanatory memorandum circulated with the Bill for the 1985 Act, which indicated that the amendments to be effected by the Bill were to "apply to all assessments applied at all levels of the Repatriation determining system after the commencement of this Bill". In Delkou at p 412 the Court said:
   

"In our view, it is clear from this legislative framework and from the manner in which the present matter was dealt with within that framework that the subject matter of the application before the Tribunal was the assessment or, alternatively the re-assessment, of the rate of the applicant's pension. It follows, in our opinion, that the application before the Tribunal fell within s.68(2) of the 1985 Amendment Act. It will be recalled that by s.68(4) of that Act, the provisions of s.68(2) are made applicable to proceedings, even if they were commenced before the commencement of the 1985 Amending Act.

The applicant further argued that, because of the general assumption that legislation is not to apply retrospectively (see Maxwell v Murphy

(1957) 96 CLR 261 at 267; D C Pearce, Statutory Interpretation in Australia, 2nd ed, at p 149; Bennion, Statutory Interpretation at p 443; cf Duralla Pty Ltd v Plant (1984) 54 ALR 29; 2 FCR 342), it should be presumed that the amendment to Sch.2 was not capable of application in his case. We think that the Parliament intended here to displace the ordinary assumption that legislation does not have a retrospective effect. The language of s.68 of the 1985 Amendment Act itself indicates such an intention. If needed, confirmation of that intention may be found in the parliamentary material to which we have referred."

1. There is force in the argument that the approach adopted in Delkou applies to the present cases; namely, that since the relevant applications had not been determined as at 22 December 1988 the whole of the benefits provided by the Act after that day should be regarded as having been available during the whole of the period since the applications were lodged. The outcome, of course, would be the converse of the way Mr Delkou found himself faced with the more stringent requirements which came into effect between the date of his application and its final determination. However, upon reflection, I have come to the view that this is not the approach which was intended by the Parliament in enacting the 1988 amendments.

2. One of the amendments made in 1988 was the substitution of a new s.19 for the section of that number which was enacted in 1986. That section deals with the determination of claims and applications. Importantly, it introduces, for the first time in Australian repatriation legislation, the concept of an "assessment period". The relevant parts of s.19 are as follow:
   

"19. (1) Where a claim or application is submitted to the Commission in accordance with subsection 17(2), the Commission shall:

(a) consider all matters that, in the Commission's opinion, are relevant to the claim or application; and

(b) subject to this section, determine the claim as provided by subsection (3) or the application as provided by subsection

(4).

(2) . . .

(3) The Commission shall determine a claim for a pension as follows:

(a) first, the Commission shall determine whether the claimant is entitled to be granted a pension in respect of:

(i) the incapacity of a veteran from war-caused injury or war-caused disease, or both; or

(ii) the death of a veteran that was war-caused;

(b) then, if the Commission determines that the claimant is so entitled, the Commission shall proceed as set out in subsection (5).

(4) The Commission shall determine an application for a pension at an increased rate in accordance with subsection (5).

(5) Where paragraph (3)(b) applies in respect of a claim or subsection (4) applies in respect of an application, the Commission shall assess, in accordance with whichever of sections 22, 23, 24, 25, 27 and 30 are applicable:

(a) the rate or rates at which the pension would have been payable from time to time during the assessment period; and

(b) subject to subsection (6), the rate at which the pension is payable from the date of the determination; and shall make a determination approving the payment of pension in accordance with that assessment.

(6) . . .

(7) . . .

(8) . . .

(9) In this section: 'application' means an application made in accordance with section 15; 'application day', in relation to a person who has made a claim or application or on whose behalf a claim or application has been made, means:

(a) the day on which the claim or application was received at an office of the Department in Australia; or

(b) if subsection 20(2) or 21(2) applies to the person--the day on which the claim or application referred to in paragraph 20(2)(a) or 21(2)(a) was so received;

'assessment period', in relation to a claim or application relating to a pension, means the period starting on the application day and ending when the claim or application is determined; 'claim' means a claim made in accordance with section 14; . . ."

1. Subsection 5(a) is important to the present case. It applies, amongst other situations, where the Commission determines an application for a pension at an increased rate. The Commission is then bound to determine "the rate or rates at which the pension would have been payable from time to time during the assessment period"; that is, the period which elapsed between the application day and the day when the application is determined. The subsection expressly contemplates that the rate of pension may vary from time to time during this period. There was no similar provision in the legislation considered in Delkou. That legislation contemplated a decision which fixed a rate applicable, without variation, for the whole of the period which elapsed between the application and the determination.

2. The application of the approach taken in Delkou to the present cases still leaves the situation that the benefits made available under the amendments to veterans whose applications were pending on 22 December 1988 include the concept of a rate of pension, variable in accordance with changes in circumstances during the assessment period. One of the possible changes in circumstances is a change in the rate of the pension prescribed by Parliament. The application of that concept permits the Commission -- including, of course, the Veterans' Review Board and the Administrative Appeals Tribunal reviewing a Commission decision -- to increase pensions by allowing the extreme disablement adjustment only from the date when that higher rate came into existence.

1. The notes as to the commencement dates of other sections in the 1988 Act provide some insight into Parliament's intention. I have already referred to s.2 of that Act. As was contemplated by that section, a commencement date was inserted at the foot of each section in the 1988 Act. In the majority of cases the stated commencement date was the day of Royal Assent. But this was not always the case. A number of provisions were deemed to have commenced prior to that day, 22 December 1988. Section 14 of the amending Act provides an example. That section amended s.23 of the 1986 Act, dealing with the intermediate rate of pension, in two separate respects. By para.(a) of the section a new s.23(1)(a) was substituted. The date of this commencement was stated to be 22 May 1986; that is, the date on which the 1986 Act commenced. By para.(b) of s.14 an amendment was made to the new sub-para(i) of s.23(1)(a), substituting a lower disability percentage; but that amendment was to commence only on the day of Royal Assent. The clear intention was that, after the 1988 amending Act came into force, s.23(1)(a) was to read as if it contained, and had always contained, the new wording; but after the day of Royal Assent the lower incapacity percentage would apply.

2. The amendments made to s.23 only have significance in connection with decisions made after those amendments were enacted. Section 14 of the amending Act is one of the sections referred to in s.3(1), so that the same argument is available, as in the present case, that the effect of that subsection was to apply the amendments to determinations made after 22 December 1988 as if those amendments had always been in the Act. Yet the distinction drawn by s.14 of the amending Act shows clearly that this was not the intention of the Parliament; that although the new s.23 was to apply to decisions made on or after 22 December 1988 -- even in respect of applications pending on that day -- only the first of the two amendments was to be treated as if it had always been in force.

3. A similar contrast appears in s.15, making amendments to s.24 of the 1986 Act in connection with the special rate of pension.

4. Two other considerations, mentioned during the course of argument, provide some support for the position taken by the Repatriation Commission. The first consideration is that this position avoids discriminating between applicants by reference to the date upon which their applications are determined. Suppose two applications, made on a particular day before 22 December 1988 by veterans who each satisfy the criteria set out in the new s.22(4). One application is determined prior to 22 December 1988. Clearly, no extreme disablement adjustment could be added to the pension payable between the date of application and the date of determination. (The veteran might, of course, subsequently apply for a further increase in the rate of pension and, after 22 December 1988, obtain an extreme disablement adjustment. But that adjustment could only be applied from the date of the fresh application, not from the date of the original application). The second application is determined after 22 December 1988. On the argument put in the present cases for the two veterans the extreme disablement adjustment could be back-dated to the date of application. The second applicant would be advantaged by the delay in determining his application.

5. It is dangerous to put much weight upon this type of anomaly. The frequent amendments to the repatriation legislation must have caused many anomalies, as between applicants in like situations. The facts in Delkou illustrate the point. Even so, an intention deliberately to create such an anomaly ought not lightly to be attributed to Parliament.

6. The second consideration arises out of the report of the Veterans' Entitlements Act Monitoring Committee. The Committee recommended numerous changes. In most cases no reference was made as to the date upon which the changed benefit should be effective. This statement applies to recommendation 1.1, relating to the extreme disablement adjustment. But at least one recommendation, 2.14, was that a particular amendment should be made retrospective to claims and applications determined on or after 6 June 1985. The Government rejected this recommendation; but the matter has some significance as indicating that the question of retrospectivity was present to the minds of both the Committee and the Government.

7. In my opinion, the better view is that the extreme disablement adjustment is not available in respect of so much of the assessment period as occurred before 22 December 1988. It is available in connection with any part of the assessment period on or after that date. This was the view applied by the Repatriation Commission in Mr Walshe's case. It follows that his application for review must be dismissed. In Mr Cobban's case the Veterans' Review Board back-dated the extreme disablement adjustment to a date earlier than 22 December 1988. This was not a permissible course. The application made by the Repatriation Commission in that case must be allowed, the decision set aside and the matter remitted to the Board for further consideration according to law. No orders for costs are sought.