Appellant v First Respondent

1 On 30 April 2021 I delivered a preliminary judgment in this matter.[1] That judgment should be read as one with this judgment. In the preliminary judgment I expressed concern that the applications for review made to the Victorian Civil and Administrative Tribunal ('VCAT') by Mr Marshall and by the Union respectively and VCAT's decision on those applications for review,[2] being the matters out of which this application for leave to appeal arises, may have fallen outside the jurisdiction of VCAT. I described the reasons for my concern. The main question was whether the jurisdiction of the Board under s 23(6) of the Emergency Services Superannuation Act 1986 ('ESS Act') was limited to the review of decisions of the Emergency Services Superannuation Board ('the Board') that had been reconsidered by the Board under s 23(4) of the ESS Act. The terms of s 23 of the ESS Act are set out in the preliminary judgment.[3]

2 On 25 May 2021, pursuant to prior directions, the parties filed written submissions relating to my concerns. On 26 May 2021 I caused a memorandum to be sent to the parties responding to their written submissions and inviting them to consider certain additional points. On 27 May 2021 a further oral hearing was conducted.

3 It has been the unanimous position of all three parties at all relevant times that VCAT had the requisite jurisdiction to hear and determine the two applications for review, although the reasons advanced in support of that position have differed a little as between the parties. All parties have submitted that, whatever view I might finally adopt in relation to the question of jurisdiction, I should decide as many of the other issues in the case as it would be necessary or appropriate to decide on the footing that VCAT did have jurisdiction.

4 In the end, the parties have persuaded me that I should proceed on the basis that VCAT did have jurisdiction to hear and determine the applications for review and that VCAT would have jurisdiction to deal further with the applications for review in the event that I decided to set aside VCAT's decision on other grounds.

5 Generally speaking, the mere consent of the parties does not confer on a court or tribunal a jurisdiction or power that the court or tribunal does not otherwise have.[4] In Re Boulton: ex parte Construction, Forestry, Mining & Engineering Union[5] Kirby J said:

Every court or tribunal in this country must, where objection is taken to its jurisdiction, determine that objection as a preliminary question. If it has no lawful jurisdiction it may not assume that it has and it ought not to pretend that it has.

6 It is true that, apart from my own concerns, there has been no 'objection' to jurisdiction in this case. It is also true that this Court's own jurisdiction to entertain the present application for leave to appeal under s 148 of the Victorian Civil and Administrative Tribunal Act 1998 ('VCAT Act') is not in doubt except as to the appropriateness of considering the particular questions of law sought to be raised and, consequently, as to the range of orders that may be open to the Court. Where VCAT makes a decision beyond jurisdiction, this Court has power to say so in an appeal under s 148 of the VCAT Act. A decision made in fact by VCAT, even if beyond its jurisdiction, is still an appellable decision.[6] The wrongful assumption of jurisdiction itself would raise a question of law for the purposes of s 148 of the VCAT Act. However, such a decision would otherwise be of no force or effect in law. And it would be erroneous for this Court to act by reference to factual findings, legal pronouncements or exercises of discretion on the part of a tribunal that had no jurisdiction at all, or for this Court to remit a matter to a tribunal for further hearing and determination if the tribunal would have no jurisdiction to further hear and determine it.

7 Before me, counsel for Mr Marshall and counsel for the Union submitted that, in the absence of an objection to jurisdiction by any party, I should only hold back if I consider that a lack of jurisdiction on VCAT's part is 'manifest'. Counsel cited Chan Yee Kin v Minister for Immigration & Ethnic Affairs[7] for that proposition, referring in particular to the judgment of Mason CJ.[8] In Chan, in the passage cited by counsel, Mason CJ said:[9]

In the absence of full argument I would not wish to express a concluded view on the question whether the Federal Court had jurisdiction in the circumstances of this case. Suffice to say that absence of jurisdiction was not manifest; indeed, there is prima facie a strong case for holding that the Federal Court had jurisdiction. In this situation, we would not be justified in going behind the Minister's concession that Keely J had jurisdiction to hear and determine Mr Chan's application for judicial review of the two decisions.

8 In itself, that passage would certainly assist counsel's submission to a certain extent, although Mason CJ does not actually lay down a test that the absence of jurisdiction must be 'manifest'. However, in the same case, Dawson J said that the Minister's 'failure to take the point does nothing to confer jurisdiction, and it cannot be disregarded'.[10] Dawson J proceeded to consider the point in some detail. Toohey J said:[11]

Since the point goes to the jurisdiction of the Federal Court to entertain the applications, it cannot be ignored. At the same time this Court has not had the benefit of full argument.

9 Like Dawson J, Toohey J went on to consider the merits of the point. Gaudron J commenced her reference to the matter by commenting that counsel for the Minister had 'somewhat unhelpfully' merely drawn the point to the Court's attention, submitting that it was for the Court to be satisfied that the decision in question was one to which the Administrative Decisions (Judicial Review) Act 1977 (Cth) applied and that therefore it was within the Federal Court's jurisdiction.[12] Her Honour then addressed the substance of the point. McHugh J also dealt with the merits of the point, ultimately holding that there was 'no reason to doubt that the Federal Court had jurisdiction in these matters'.[13]

10 On the other hand, speaking more generally, I accept that there is room to apply a principle of judicial restraint where all parties are agreed on a particular course in a case and there is no contradictor.[14] Hence I do not propose to analyse the question of VCAT's jurisdiction in great detail.

11 My original concerns are sufficiently described in the preliminary judgment. Principally, it seemed to me that the expression 'a decision of the Board' in s 23(6) could not mean any decision at all made by the Board, extending even to decisions to purchase stationery or hire staff. I thought that the expression may well mean a decision made on reconsideration under s 23(4) of a decision referred to in s 23(1), namely 'a decision of the Board which relates to the entitlement of any person to any benefit'. That interpretation seemed to be supported by the heading of s 23: 'Person may request Board to reconsider decision'. And there were other matters that seemed to me to point in the same direction.[15]

12 However, quite tellingly, the parties have pointed out that what is now s 23(6) was substituted by an amending Act in 2000.[16] The amending Act repealed the former s 23(6). Under the former s 23(6), an application for review could only be made in relation to a decision made under s 23(2) (ie, a decision on an application to extend the time for requesting reconsideration) or a decision 'which has been confirmed or varied under sub-section (4)'. The parties submitted that the amendment in 2000 would be set at nought if s 23(6) were to be read in the limited fashion that I had suggested might be appropriate.

13 There remains some reason to suspect that those sponsoring the 2000 amendment did not really intend to depart from the legislative policy previously evident in s 23(6), and that s 23(6) came into its present form by reason of a drafting error. In my abovementioned memorandum of 26 May 2021 and in discussions with counsel at the hearing on 27 May 2021, I gave various particulars in support of my suspicion to that effect. However, it is unnecessary to rehearse all of that here.[17] In the end, I accept that to read s 23(6) (in its current form) as being impliedly limited to the review of reconsidered decisions or to the review of decisions made on reconsideration would at least appear to be in stark conflict with the legislative history and, in any event, would properly be characterised as a reading that would 'fill a gap' or that would make an insertion that is 'too big' or 'too much at variance with the language in fact used by the legislature'.[18] Hence, such a limitation should not be discerned in s 23(6).

14 I remain of the view that the expression 'a decision of the Board' is not to be regarded as limitless. However, I would accept the submission made by counsel for the Board in this regard, namely that the proper limitation to be discerned in the expression is that which flows from the definitions of 'decision-maker' and 'enabling enactment' in s 3 of the VCAT Act and from the provisions of s 4 of that Act (which is entitled 'When does a person make a decision?'), ie, that 'decision of the Board' in s 23(6) means a decision of the Board made under the ESS Act. The decisions of the Benefits and Services Committee of the Board made in March and April 2017 that were reviewed by VCAT answer that description. It follows that VCAT did have and would retain jurisdiction in this matter.

15 For completeness, I note that, had I concluded that s 23(6) was only applicable once a reconsideration had taken place, I would have found that VCAT had had no jurisdiction. Notwithstanding the valiant submissions to the contrary made by counsel for Mr Marshall and by counsel for the Union, I would have accepted without hesitation the submission of counsel for the Board to the effect that there was in fact no reconsideration (within the meaning of s 23(1)-(5) of the Act or at all) of the decisions made in March and April 2017 by the Benefits and Services Committee of the Board.

16 On the other hand, I accept that my previous tentative concern about the question whether that Committee had a proper delegation should be regarded as dispelled by the application of the presumption of regularity. Further, there is no longer any cause for concern about non-compliance with any applicable time limits. That was confirmed by additional material provided to this Court by the parties after the preliminary judgment was delivered.

17 Accordingly, I will proceed to the principal issue in this case, namely the proper interpretation and application of the definition of 'salary' in the ESS Act.

18 In the preliminary judgment, I mentioned that the expression 'superable salary' is frequently used to refer to a contributor's 'salary' within the meaning and for the purposes of the defined benefits scheme established by the ESS Act.[19] I mentioned also that the expression 'superable salary' does not actually appear in the ESS Act.[20] The expression is a little unfortunate, in that it might be thought to imply that the ascertainment of the quantum of 'salary' for the purposes of the defined benefit scheme is a wholly objective exercise, ie that some things are necessarily 'salary' or part of 'salary' and all other things are necessarily not so. The true position under the ESS Act is otherwise. Although there is a definition of 'salary' in s 3(1) of the ESS Act, it is a very complex, obscure and multifaceted definition, the operation of which is affected by several other provisions of the ESS Act. There is considerable room for judgment as to what may or may not be eligible to be counted as 'salary' for the purposes of the defined benefits scheme. Reasonable minds could well differ in that regard. There is also scope in some situations for the exercise by the Board, or, on review, by VCAT, of an express power to 'approve' salary for the purposes of the scheme. The corollary, of course, is that, in those situations, absent such approval, that which might otherwise be salary will not be salary for the purposes of the scheme. The express power is plainly discretionary.

19 Mr Marshall and the Union contend that VCAT erred in two related ways in relation to the interpretation and application of the definition of salary in the ESS Act. Principally, they argue that VCAT wrongly treated Mr Marshall as being covered by a particular aspect of the definition of salary. They submit that, as a consequence, VCAT analysed Mr Marshall's overall remuneration for the years in question from a wrong starting point. They submit, in effect, that this was a material error of law in that there is a realistic possibility that the decision in fact made might have been different if the error of law had not occurred.[21] Secondarily, albeit relatedly, they submit that, to the extent that a power to 'approve' (or not 'approve') elements of Mr Marshall's remuneration was available, VCAT's exercise of that power miscarried.

20 For the reasons about to be given, I agree with Mr Marshall and the Union on their principal point. In that situation, and in all the circumstances of this case, as will be seen, it is inappropriate to express any concluded views on the related, secondary point. Mr Marshall's success on the construction point, alone, warrants the grant of leave to appeal and the allowing of the appeal.

21 The amount of a contributor's 'salary' affects the calculation of the amounts that must be contributed to the scheme by the contributor's employer[22] and the calculation of the amounts that may be contributed to the scheme by the contributor.[23] It also affects the calculation of the maximum total amount that a contributor may contribute to the scheme over the contributor's career.[24] In a related way, it affects the calculation of a certain statutory 'multiplier' which in turn affects the calculation of the quantum of the contributor's retirement benefit.[25] In addition, speaking generally, the average annual amount of the contributor's 'salary' during the last two years of the contributor's service is a further and major factor in calculating the retirement benefit to be paid to the contributor on retirement.[26]

22 As mentioned above, the principal definition of 'salary' appears in s 3(1) of the ESS Act. That sub-section contains a series of definitions of individual words or expressions. It commences 'In this Act - '. There is no express provision in s 3(1) or elsewhere in the ESS Act to the effect that the definitions apply 'unless the contrary intention appears'. However, such a qualification is generally to be taken as implied.[27]

23 The definition of 'salary' now appearing in s 3(1) of the ESS Act was inserted in 1996. It reads as follows:

salary means-

(a) the amount, computed as determined by the Board, of the annual rate of remuneration for the time being payable periodically and regularly to a contributor or a police recruit by an employer excluding any expense of office or uniform allowance, reimbursement of travelling or other incidental expenses and all other allowances which would not ordinarily be payable in respect of every pay period in a year of employment or during the training of the police recruit; or

(b) in the case of a contributor who is engaged under a contract of employment, salary means the salary for superannuation purposes specified from time to time in that person's contract of employment, notified in writing by that contributor's employer to the Board and which is approved by the Board;

24 It will be seen that the word 'employer' appears in both paragraph (a) and paragraph (b) of the definition of 'salary'. The word 'employer' is itself defined in s 3, as follows:

employer means the employer of -

(a) an employee; or

(b) a police recruit;

25 The word 'employee', in turn, is defined in s 3. It is not necessary to set that definition out in full. Paragraph (h) of the definition of 'employee' covers Mr Marshall, because he is a person referred to in paragraph (c) of the definition of 'employee' (ie, an officer or employee of the Metropolitan Fire Brigades Board) who:

has resigned or has been given leave of absence without pay to act as a full-time officer of -

(i) a union; or

(ii) an employee organisation -

which is approved by the Minister;

Mr Marshall, being an 'employee', is also a 'contributor' for the purposes of the ESS Act.[28]

26 Section 4 of the ESS Act is entitled 'Application of Act'. It includes a sub-section (1E). Paragraph (b) of s 4(1E) of the ESS Act is the critical provision for the purposes of this case. However it is desirable to set out the whole of s 4(1E). It provides:

For the purposes of the definition of salary in section 3 -

(a) in the case of a contributor who is on leave of absence without pay or less than full pay and is not acting as a full-time officer of a union or employee organisation, salary means the salary that the contributor would have received had the contributor not been on leave of absence without pay or less than full pay and not been acting as a full-time officer of a union or employee organisation, or such greater salary as is paid to the contributor by any other employer and approved by the Board;

(b) in the case of the contributor who is an employee of a union or employee organisation, the salary that the contributor would have received had the contributor not been an employee of a union or employee organisation, or such greater salary as is paid to the contributor by the union or employee organisation and approved by the Board;

(c) in the case of a part-time contributor, salary means the salary which would be payable at that time to a person in similar employment on a full-time basis;

(d) if a contributor's salary is reduced, on or after 1 July 2019 then, unless the contributor agrees in writing that the reduced salary applies, salary means the greater of -

(i) the salary of the contributor immediately prior to the reduction; and

(ii) the actual salary;

(e) in the case of a contributor who receives payments under section 20F(17) or 20F(18), salary includes those payments;

(f) on and from 1 January 1994, the salary used to determine the accrued benefit of a former contributor is the salary averaged over a period of 2 years prior to the date of termination of service calculated -

(i) in relation to a contributor with less than 2 years of service, an amount calculated in accordance with the formula -

where -

"A" is the aggregate salary paid to the contributor in respect of the contributor's period of service;

"B" is the total number of days in that period;

(ii) in relation to a contributor with 2 years or more of service, an amount equal to one-half of the contributor's aggregate salary for the period of service of 2 years ending on the contributor's last day of service -

and if the period of recognised service includes a period of leave without pay, there is deemed to have been payable to that contributor during that period of leave without pay, salary at the rate payable to the contributor immediately before the period of leave, or such higher salary as has been approved by the Board for the purposes of this subsection.

27 There is an obvious slip in the language of s 4(1E)(b). For the provision to make any sense, it is plainly necessary to read in, after the words 'in the case of the contributor who is an employee of a union or employee organisation' the words 'salary means'.[29]

28 In the present case, VCAT ruled that Mr Marshall was not covered by paragraph (a) of the definition of 'salary' in s 3(1) of the ESS Act, but was (directly) covered by (b) of that definition. By contrast, as will be seen, in my view paragraph (b) did not apply to Mr Marshall at all, while paragraph (a) was of indirect application to him. VCAT ruled that paragraph (b) applied on the basis that there was a (written) contract between the Union (represented by its Victorian branch) and Mr Marshall that VCAT considered to be a 'contract of employment' within the meaning of paragraph (b); and that that contract 'specified' a salary for superannuation purposes.[30] VCAT also appears to have taken the view that the salary so 'specified' had been notified in writing by the employer (the Union) to the Board. In those circumstances, VCAT proceeded to consider whether to approve what it considered to be the 'salary' so 'specified'. VCAT did approve it. Only then did VCAT turn to consider whether to include (or to approve) other amounts actually received by Mr Marshall from the Union in connection with his employment.[31]

29 It is true that VCAT did also have regard to the provisions of s 4(1E)(b) of the ESS Act. However, VCAT rejected Mr Marshall's contention that the second limb of s 4(1E)(b) applied to the exclusion of paragraph (b) of the definition of 'salary' in s 3(1) of the ESS Act in the case of a contributor on leave of absence to act as a full-time officer of a union (such as Mr Marshall) where the contributor's 'salary' (on any interpretation of that word) as a union officer is greater than the 'salary' that the contributor would otherwise have received.

30 Rejecting Mr Marshall's interpretation of the statutory provisions led VCAT to concentrate on the terms of the written contract between the Union and Mr Marshall. In my view, VCAT treated the contract, particularly insofar as it specified a salary for superannuation purposes, as determinative, or virtually determinative, of the maximum amount that could be 'approved' as 'salary' for Mr Marshall in relation to the years in question. A striking example of that is that VCAT determined that a certain periodical and regular allowance received by Mr Marshall, called the 'EMR allowance', was not 'superable' because it was not (according to VCAT) part of what the written contract specified as Mr Marshall's salary for superannuation purposes. This determination is to be contrasted with the conclusion of the Benefits and Services Committee (as an aspect of the decisions under review by VCAT) to the effect that the EMR allowance paid to Mr Marshall was 'superable' as a periodical and regular allowance.[32]

31 In my opinion, VCAT's approach in this regard involved misinterpretation of the relevant provisions. Mr Marshall's contention that the second limb of s 4(1E)(b) applied in his case to the exclusion of that part of the definition of 'salary' that is contained in s 3(1)(b) of the ESS Act was correct. And there is at least a realistic possibility that the decision of VCAT might have been different, at least to some extent, had it adopted the correct interpretation of the relevant provisions.

32 There are two main, cumulative reasons why Mr Marshall's construction of the relevant provisions is correct. First, contrary to VCAT's view, the second limb of s 4(1E)(b) is quite dissimilar from paragraph (b) of the definition of 'salary' in s 3(1). The two cannot operate together. The second limb of s 4(1E)(b) operates by reference to what is 'paid' to the contributor by the Union (and approved by the Board). By contrast, paragraph (b) of the definition of 'salary' in s 3(1) of the ESS Act operates by reference to the 'salary for superannuation purposes' that is 'specified' in the 'contract of employment' and notified by the employer (and approved by the Board). There is no overlap between those concepts. Nor is it at all likely to be intended that the Board should engage in two 'approval' exercises, rather than one.

33 Without more, those considerations would be reason enough to disagree with the interpretive approach adopted by VCAT. But there is more.

34 The second main reason why Mr Marshall's construction is correct is that the expression 'contract of employment' in paragraph (b) of the definition of 'salary' in s 3(1) of the Act does not carry its ordinary meaning. Rather, it is a reference to a more narrow concept well known and recognised in relation to employment in the Victorian public sector. In particular, it does not include a reference to contracts of employment entered into outside the Victorian public sector, like Mr Marshall's contract of employment.

35 The principal definition of 'salary' in s 3(1) sets up a dichotomy between, relevantly, contributors in general (referred to in paragraph (a)) and 'the case of a contributor who is engaged under a contract of employment' (referred to in paragraph (b)). So, paragraph (a) seems to be directed to the general or usual case and paragraph (b) to the special case. However, if 'contract of employment' in paragraph (b) were to carry its ordinary meaning, there would be little or nothing 'special' about the field it would cover. All of the contributors to the scheme, except (probably) police officers, are engaged under 'contracts of employment' within the ordinary meaning of that expression. That is so because, putting aside certain 'officers of the law' about to be mentioned, there can be no employment, even in the public sector, without a contract of employment.[33] Since the nineteenth century, the Australian colonies and the Australian States have recognised that public servants are engaged under contracts of employment.[34] On the other hand, traditionally, at common law, police officers,[35] as well as defence personnel[36] and magistrates and other judicial officers,[37] have been regarded as independent officers of the law rather than as employees of the Crown or the State. For some statutory purposes, Victorian police officers have been deemed to be employees. Indeed, they are listed as 'employees' in s 3(1) of the ESS Act itself; and they are therefore covered by the Act as contributors. They are also deemed to be employees for the purposes of the Fair Work Act 2009 (Cth) in relation to the industrial regulation of their terms and conditions of work.[38] As a result, for the vast majority of Victorian police officers, their terms and conditions of work are mainly determined by collective industrial agreements.[39] That has been so for decades. But it is hardly to be thought that paragraph (a) of the definition of 'salary' in the ESS Act is directed solely at police officers and that paragraph (b) is directed solely at every other class of contributor. That would not be to treat paragraph (b) as dealing with the special case.

36 What, then, does 'contract of employment' mean in paragraph (b) of the definition? A very strong clue is supplied by the fact that paragraph (b) assumes that, in every case, the 'contract of employment' will specify, from time to time, the contributor's salary for superannuation purposes.

37 To determine what is really being referred to in paragraph (b) of the definition of 'salary' in s 3(1) of the ESS Act, it is necessary to refer to the history of the provisions directly in question and the history of certain related legislation, together with some aspects of the general history of the regulation of public sector employment in Victoria. This is a legitimate technique for the interpretation of statutory provisions.[40]

38 Before 1996, the ESS Act did not define 'salary'. That had been done by the regulations made under the Act. The provisions of the ESS Act now in question were inserted by ss 6 and 7 of the Superannuation Acts (Further Amendment) Act 1996 (Vic). The explanatory memorandum to the amending legislation referred to the prior regulations. The relevant passage read as follows:

Clause 6 inserts definitions previously in the Emergency Services Superannuation Regulations 1987 and the Emergency Services Superannuation (Police Recruits) Regulations 1987 into the Emergency Services Superannuation Act 1986. The Emergency Services Superannuation Regulations 1987 and the Emergency Services Superannuation (Police Recruits) Regulations 1987 are revoked under clause 21.[41]

39 The explanatory memorandum contains a slip, in that the Emergency Services Superannuation Regulations 1987 do not exist, and never have. The relevant regulations appear to be, instead, the Emergency Services Superannuation Scheme Regulations 1987 (Vic).[42] However, s 21 of the Superannuation Acts (Further Amendment) Act 1996 (Vic), as passed, repealed the correct regulations. Accordingly, the relevant provisions in s 3(1) and s 4(1E)(b) of the (present) ESS Act are drawn from the Emergency Services Superannuation Scheme Regulations 1987 (Vic).

40 As originally made, reg 3 of the 1987 regulations relevantly provided:

3(1) In these Regulations -

...

(j) 'Salary' means the amount, computed as determined by the Board, of the annual rate of remuneration for the time being payable periodically and regularly to a contributor by an employer excluding any expense of office or uniform allowance reimbursement of travelling or other incidental expenses and all other allowances which would not ordinarily be payable in respect of every pay period in a year of employment.

(2) For the purposes of the definition of salary in sub-regulation (1) -

...

(a) in the case of every contributor who is an employee of Ambulance Service Victoria employed under the Ambulance Services Award, salary means the rate prescribed for the classification of the contributor at Ambulance Service Melbourne;

(b) in the case of a contributor who is on leave of absence without pay or less than full pay and is not acting as a full-time officer of a union or employee organisation, salary means the salary of the contributor immediately prior to the commencement of that leave of absence increased in accordance with changes in the salary applicable to the substantive classification of the contributor during such leave or such greater salary as is paid to the contributor by any other employer and approved by the Board;

(c) in the case of a contributor who is an employee of a union or employee organisation, salary means[43] the last salary of the employee immediately prior to becoming a full-time officer of a union or employee organisation adjusted in accordance with changes in the rate of salary for the last substantive classification of the contributor or such greater salary as is paid to the contributor by the union or employee organisation and approved by the Board;

(d) in the case of a part-time contributor, salary means the salary which would be payable at that time to a person in similar employment on a full-time basis;

(e) if a contributor's salary is reduced, and the Board agrees that the reduction shall not be taken into account, salary means the greater of -

(a) the salary of the contributor immediately prior to the reduction; and

(b) the actual salary.

41 As will be apparent from the above, the different scheme for contributors engaged under contracts of employment did not exist in the Emergency Services Superannuation Scheme Regulations 1987 (Vic) as they were originally passed. The idea of a contract of employment played no relevant part in those regulations at that time.

42 However, in 1995 the relevant parts of reg 3 were amended, with effect from 1 January 1994, by the Emergency Services Superannuation Scheme (Amendment) Regulations 1995 (Vic)[44] such that they read:

(j) "salary" means -

(i) the amount, computed as determined by the Board, of the annual rate of remuneration for the time being payable periodically and regularly to a contributor by an employer excluding any expense of office or uniform allowance reimbursement of travelling or other incidental expenses and all other allowances which would not ordinarily be payable in respect of every pay period in a year of employment; or

(ii) in the case of a contributor who is engaged under a contract of employment, "salary" means the salary for superannuation purposes specified from time to time in that person's contract of employment, notified in writing by that contributor's employer to the Board and which is approved by the Board.

...[45]

(2) For the purposes of the definition of salary in sub-regulation (1) - [46]

(b) in the case of a contributor who is on leave of absence without pay or less than full pay and is not acting as a full-time officer of a union or employee organisation, salary means the salary that the contributor would have received had the contributor not been on leave of absence without pay or less than full pay and not acting as a full-time officer of a union or employee organisation, or such greater salary as is paid to the contributor by any other employer and approved by the Board;

(c) in the case of the contributor who is an employee of a union or employee organisation, the salary that the contributor would have received had the contributor not been an employee of a union or employee organisation or such greater salary as is paid to the contributor by the union or employee organisation, and approved by the Board.

43 Thus, the predecessor of s 4(1E)(b) of the ESS Act first appeared in 1995, in the regulations inserted by the Emergency Services Superannuation Scheme (Amendment) Regulations 1995 (Vic).

44 Leading up to 1995, between 1987 and 1992, the major public sector employment legislation in place in Victoria was the Public Service Act 1974 (Vic). That Act provided for the appointment of workers to 'offices' in the public service, as well as for temporary employment. The only kind of 'employment' recognised was temporary employment. The 1974 Act does not mention contracts of employment at all.

45 The Kennett Liberal government was in power in Victoria from 1992 to 1999. The Kennett Government introduced a large swathe of industrial legislation in 1992, replacing the Industrial Relations Act 1979 (Vic) with the Employee Relations Act 1992 (Vic) ('ER Act'). The ER Act strongly favoured individual workplace arrangements. Indeed, an employee and employer between whom a collective agreement existed could make individual agreements that took precedence over the collective agreement. As a matter of administration, rather than statute, government employers were encouraged to engage employees under individual arrangements.

46 The Kennett Government also introduced the Public Sector Management Act 1992 (Vic) ('PSM Act'), which repealed and replaced the Public Service Act 1974 (Vic). The PSM Act provided for three kinds of employment, temporary employment, casual employment and fixed term employment. Fixed term employment was the default mode of employment in the public sector under the PSM Act.[47] A departmental head could only employ a casual or temporary employee where necessary.[48] The PSM Act did not provide departmental heads with a power to employ persons on an ongoing basis. Nor did it provide for tenure.

47 The scheme set out in the PSM Act separated employment in the public sector into three overlapping streams, department heads, senior executive officers and other officers.[49] Executive officers were senior executive officers and chief executive officers.[50] Department heads were generally chief executive officers.[51]

48 In the scheme, each executive officer's employment was governed by a contract of employment between the officer and their employer, usually, the relevant Department Head.[52] Such a contract of employment had to include certain terms,[53] and the executive officer held their position only for as long as their contract of employment remained in force.[54] Indeed, where an executive officer's contract of employment pre-dated their appointment to a position in the public service, the contract of employment became the instrument of appointment.[55]

49 Importantly, an executive officer was only entitled to the monetary remuneration and other benefits set out in their contract of employment.[56] The proportion of a particular senior executive officer's remuneration that was allocated to money as against benefits like superannuation and motor vehicles could, within the scheme, have varied, but the total remuneration package was capped at a rate set out in Sch 3 of the PSM Act.[57]

50 Further, at the time the definitions of 'salary' were inserted into sub-ss 3(1)(b) and 4(1E)(b) of the ESS Act, the superannuation of executive officers was specifically dealt with in separate legislation, the Superannuation (Public Sector) Act 1992 (Vic) ('SPS Act'). At that time, the SPS Act provided that it 'must be read as one with the [PSM Act] and as if [it] formed part of that Act'.[58] The contract of employment under which an executive officer was engaged pursuant to the PSM Act was also integral to the SPS Act.

51 The SPS Act defined 'contract officer' to mean 'an executive officer whose contract of employment provides that he or she continues to be a member of a statutory superannuation scheme'. The Emergency Services Superannuation Scheme was not listed in the SPS Act as a 'statutory superannuation scheme'. However, the SPS Act did make provision for the inclusion by executive declaration of other statutory superannuation schemes. To date, the Emergency Services Superannuation Scheme has not been included in any such declaration.

52 For the purposes of their statutory superannuation scheme, a contract officer's salary was, under s 12 of the SPS Act, 'taken to be the amount from time to time specified for that purpose in the contract of employment'. So the SPS Act shows that the other major public sector superannuation schemes used the term 'contract of employment' to mean the instruments under which executive officers were engaged in the public service. Not only that, the SPS Act also assumed that executive officers' contracts of employment would specify their salary for superannuation purposes.[59]

53 There was no equivalent scheme for officers other than executive officers. At least so far as the PSM Act was concerned, contracts of employment were not a concept relevant to their employment.[60] Only executive officers were engaged under contracts of employment; and only workers engaged under contracts of employment were executive officers.

54 Accordingly, when the definition of salary that currently appears in s 3 of the ESS Act was introduced in 1995, the concept of a contract of employment had a special meaning in the Victorian public service. In that context, it did not carry its general meaning according to which all employees are engaged under contracts of employment. It meant the instrument under which an executive officer was appointed.

55 A similar scheme continues today. The Public Administration Act 2004 (Vic) (PA Act) is now the primary legislation governing public sector employment in Victoria. Executives are employed under the PA Act on contracts of employment. The contract of employment must contain certain terms,[61] and an executive's remuneration is set by the Victorian Independent Remuneration Tribunal.[62]

56 The SPS Act also continues in force. It now requires the employer of an executive appointed under the PA Act to notify the administrator of the superannuation scheme of which the executive is a member of the executive's salary for superannuation purposes.[63] That is, the PA Act and the SPS Act continue to assume that all executives' contracts of employment will specify an amount as salary for superannuation purposes.

57 Hence, the context of s 3 of the present ESS Act supports the view that the term 'contract of employment' in the s 3 definition of 'salary' means the instrument by which an executive officer in the Victorian public service is appointed.

Further context: the State Superannuation Act 1988

58 As indicated above, the superannuation scheme established by the ESS Act was not the only statutory superannuation scheme operating in the Victorian public sector at the time when the definitions of 'salary' in sub-ss 3(1) and s 4(1E)(b) were introduced. Rather, separate schemes also existed alongside the ESS Act scheme, including schemes under the State Superannuation Act 1988 (Vic) ('SS Act'), the Transport Superannuation Act 1988 (Vic) ('TS Act') and the State Employees Retirement Benefits Act 1979 (Vic) ('SERB Act').

59 In each of those three schemes, the concept of a contract of employment was and remains relevant. Further, in each of those three schemes, the term 'contract of employment' was and still is used to mean the instrument under which an executive was engaged in the public service. Further still, in each of those schemes 'salary' is defined to mean the salary specified in the contract of employment of an executive.[64]

60 The following takes the SS Act as an example, though the relevant provisions are similar across the SS Act, the TS Act and the SERB Act.[65]

61 In 1995, when the amendment to the s 3 definition of 'salary' was introduced to the ESS Act, the SS Act included a similar scheme. It included a defined term, 'contract officer', which meant essentially an executive officer employed under a contract of employment under the PSM Act, and anyone else declared by the Minister to be a deemed contract officer.[66] That is, with one exception which is of little present relevance, at the time of the insertion of the words 'engaged under a contract of employment' into the ESS Act, in the SS Act, as well as in the PSM Act, the concept of 'contract of employment' meant the instrument by which executive officers were appointed.[67]

62 That supports the view that 'contract of employment' in the ESS Act carries the meaning it did in the Victorian public service at the time the s 3 definition of 'salary' was introduced into the ESS Act. That is, it supports the view that 'contract of employment' in the ESS Act means the instrument under which an executive officer is engaged in the Victorian public sector.

63 The ESS Act also uses the term 'contract of service' in s 20F(13), which deals with disability of a contributor. That section provides:

For the purposes of subsections (5), (11), (12) and (14) a person is to be treated as being gainfully employed if the person is deriving income wholly or partly from his or her personal exertions whether on his or her own account, or delegation thereof, or under a contract of service or otherwise during the period that the person has been receiving the pension.

64 At common law, the term 'contract of service' is synonymous with 'contract of employment'. It is often used to distinguish employment arrangements (under which the worker is engaged under a contract of service) from independent contracting arrangements (under which the worker is engaged under a contract for services). Clearly, the term is used to distinguish a contract of service from a contract for services in s 20F(13). But it is nevertheless significant that when the legislature chose to refer to a contract under which a worker was employed at common law in the ESS Act in 20F(13) it used the term 'contract of service'. It did not use the term 'contract of employment'.

65 Again, that indicates that when the legislature used the term 'contract of employment' it was intended to take a different meaning, namely, the special meaning it holds in the Victorian public service. The considerations set out in the preceding paragraphs concerning the SS Act are only strengthened by the very similar provisions in the TS Act and the SERB Act. Those considerations further support the conclusion I have earlier drawn that 'contract of employment' in the s 3(b) definition of salary in the ESS Act means the instrument by which an executive is engaged in the Victorian public service.

66 I also consider that the purpose of the s 3 definition of salary weighs in favour of the special meaning. It is true that legislation dealing with the entitlements of employees who contribute to superannuation funds is beneficial legislation which must be interpreted liberally because it purports to confer a benefit on individuals or a class of persons.[68] However, it is obvious that the defined benefits scheme set out in the ESS Act was intended to be self-sufficient most of the time. There is provision in the ESS Act for the scheme to be supplemented by the Consolidated Fund if the amount to the credit of the scheme is insufficient to meet the benefits authorised to be paid out.[69] However, the provisions dealing with actuarial investigation of the scheme's financial position at the end of each year[70] and the objectives and duties of the Board[71] suggest that the scheme is intended to operate such that contributions together with returns arising out of the investment of contributions will generally cover the benefits required to be paid out. Perhaps the most obvious example of a provision confirming as much is s 6(1), which provides:

The following are objectives of the Board -

(a) to collect contributions and other assets due to the Scheme;

(b) to manage and invest the assets of the Scheme so as to maximise the return it earns, having regard to -

(i) the need to provide for payments out of the Scheme; and

(ii) the need to exercise reasonable care and prudence so as to maintain the integrity of the Scheme;

(c) to administer the payment of benefits under this Act and the Police Regulation Act 1958.

67 As mentioned above, when the ESS Act was amended to include the definition of salary in s 3(b), a contract of employment within the meaning of the PSM Act (that is, within its special meaning) had to include certain terms. Most importantly, the upper limit of the salary that a person engaged under a contract of employment could earn was effectively set by a cap on the remuneration packages of executive officers.[72] Similarly, under the current scheme set out in the PA Act, the remuneration of an executive engaged under a contract of employment is set by the Victorian Independent Remuneration Tribunal.[73] In effect, a contract of employment must limit an executive's remuneration and, hence, their salary for superannuation purposes.

68 By contrast, if 'contract of employment' bears its common law meaning, then the only limit on the benefit that might be payable out of the scheme to a contributor employed outside the public sector would be their ability to negotiate a higher salary with their employer. It seems unlikely the legislature intended the scheme to be exposed to the risk of unlimited benefits needing to be paid out. It seems much more likely that the scheme would be designed to guard against such risks.

69 Accordingly, in my view, section 3(b) of the definition of 'salary' in the ESS Act applies only to contributors who are engaged as executive officers.

70 So far as the pure questions of construction are concerned, there remains to be considered what is meant by the word 'salary' as used in the first and second limbs of s 4(1E)(b).

71 So far as the first limb is concerned, the statutory inquiry is about the 'salary' that the contributor 'would have received had the contributor not been an employee of a union or employee organisation'. Does 'salary' here mean salary on ordinary concepts? Or does it mean salary as defined in s 3(1)? In my view, it means the latter. Section 4(1E) commences with the words 'For the purposes of the definition of salary in section 3'. Those words could be clearer, but they surely involve a link of some kind back to the s 3(1) definition of 'salary'. Moreover, the counterfactual is that the contributor remained an employee in one of the categories listed in the definition of 'employee' in s 3(1), other than the 'union' category provided for by paragraph (h) of that definition. It appears that each of those other categories represents a form of public sector employment. Depending on all the facts, it might be concluded that the contributor who is now acting as a union officer, had they remained in the public sector environment, would have been engaged (at whatever the relevant time may be) under a 'contract of employment' (within the proper understanding of that term for present purposes as discussed above) - in which case some sort of judgment could presumably be made as to the terms and conditions that would have been found in the contract of employment and as to what the public sector employer would have notified to the Board in that regard and as to whether the Board would have approved the same. Alternatively, it might be concluded that the contributor would not have been engaged under a 'contract of employment'. In that event, the tests set out in paragraph (a) of the definition of 'salary' in s 3(1) could sensibly be applied.

72 What of the word 'salary' in the second limb of s 4(1E)(b)?

73 Again, for corresponding reasons, it seems to me that 'salary' here does not mean salary on ordinary concepts. Rather, it means salary as defined in s 3(1).

74 However, for the reasons given above, there will be no scope for the direct application of paragraph (b) of that definition in relation to the second limb of s 4(1E)(b). The contributor, as a union officer, will not be in public sector employment and will not have been engaged under a 'contract of employment' within the true meaning of paragraph (b) of the definition of 'salary' in s 3(1). That leaves paragraph (a) of the definition. The tests set out in paragraph (a) may well have been constructed with public sector-type employment principally in mind, but not necessarily. In any event, they are quite suitable for application to private sector employment. And it may be doubted whether the result would be much different in many cases from the result that would be produced by applying the notion of salary on ordinary concepts.

Do these conclusions mean that Mr Marshall's contract with the Union was irrelevant?

75 It does not follow from what I have said above that Mr Marshall's written contract with the Union was irrelevant or that it would be irrelevant on any remittal.

76 It so happened that the written contract that Mr Marshall entered into with the Union in 2012 closely reflected the provisions of paragraph (b) of the definition of 'salary', including by the inclusion of a term that, as VCAT held, 'specified' an amount of Mr Marshall's salary for superannuation purposes. The superannuation-related terms of the written agreement were in fact implemented, at least for a time, and, at least for a time, the Board was notified of the corresponding amount sought (by both Mr Marshall and the Union) to be treated as salary for superannuation purposes. This may have had consequences for the amounts of the contributions that were actually made by Mr Marshall or by the Union or by both. In those circumstances, and having regard to the general desirability of consistent and even-handed administration of the defined benefit scheme, the terms of the contract and the extent to which it had been implemented were not matters irrelevant to the question of what 'salary' the Board (or VCAT) might, or might not, 'approve' under s 4(1E)(b).

What about the elements of Mr Marshall's remuneration that VCAT declined to include in his 'superable' salary?

77 Nor, of course, do my conclusions on the construction point mean that VCAT was obliged, as a matter of law, to include any of the disputed items of remuneration in Mr Marshall's 'superable salary', or that the Board or VCAT would be so obliged on any remittal.

78 As foreshadowed above, I consider that it would be inappropriate to make definite pronouncements, beyond what I have said so far, as to the lawfulness of VCAT's determinations not to include as 'superable' the items of remuneration about which Mr Marshall and the Union now complain.

79 There is nothing to be gained by my making general comments about the width or extent of the discretion to 'approve' in s 4(1E)(b). The whole matter of Mr Marshall's superannuation entitlements will need to be reconsidered on the proper interpretation of the relevant provisions. The legal starting point will be different. The evidence and the facts found may be different. The parties may well agree, as was floated at the hearing, that it would be in everyone's interests for VCAT itself to remit the matter to the Board to be considered afresh on up to date material. That would enable the Board to develop and express any new general policy that might be seen as relevant and applicable, bearing in mind what Brennan J said (sitting as the President of the Administrative Appeals Tribunal) in Drake v Minister for Immigration and Ethnic Affairs (No 2):[74]

Inconsistency is not merely inelegant: it brings the process of deciding into disrepute, suggesting an arbitrariness which is incompatible with commonly accepted notions of justice.

Given the need for the Board to apply the above interpretation of the relevant provisions of the ESS Act, there is one area, in particular, in relation to which the Board may wish to review or clarify its policies, namely, the matter referred to in VCAT's decision as 'the 70% rule'.[75] Again, the applicability of the 70% rule, whether directly or by analogy, is a matter on which it would be inappropriate for me to further comment here.

The suggestion that the Board was functus officio or bound by an estoppel

80 In his notice of appeal, Mr Marshall included a series of questions of law and grounds of appeal relating to a suggestion that the Board had been bound by certain statements or conduct of its staff made or engaged in prior to the decisions of the Benefits and Services Committee of March and April 2017. It was pleaded that the Board was relevantly 'functus officio' or bound by some kind of estoppel. An attempt was made in Mr Marshall's pre-trial written submission to support this suggestion.

81 At the hearing, I expressed the provisional view that the suggestion appeared to be hopeless. Having heard that, senior counsel for Mr Marshall chose not to advance any oral submissions in support of that suggestion. He did say that it was not abandoned, and that he relied on his written submissions. On the other hand, he acknowledged that the suggestion was very much subsidiary to his main point relating to the proper construction of the legislation. Counsel for the Union effectively abandoned the suggestion so far as the Union was concerned. It seems to me that the appellants, having pressed for judgement on the construction point, have effectively elected to abandon the functus officio/estoppel point. Nevertheless, I will say something about it.

82 As mentioned above, this is an application under s 148 of the VCAT Act for leave to appeal, on questions of law, from a decision of VCAT made by way of merits review of two decisions of a delegated committee of the Board. The decisions that VCAT was called on to review were made on 9 March 2017 and 18 April 2017. The Board's first decision, dated 9 March 2017, is set out in the minutes of the Benefits & Service Committee of the Board meeting held on that day. It was relevantly in the following terms:[76]

• The Emergency Medical Response allowance is superable
• The component of the Total Remuneration Package representing the employer's contribution is not superable, irrespective of whether the component is payable as salary; and
• The living away from home allowance, meal allowance and regular overtime allowances are not superable for the purpose of calculating the defined benefit but are relevant (up to the maximum SG contribution salary base) for calculating the minimum requisite benefit.

83 The Board's second decision, dated 18 April 2017, is also set out in the minutes of a meeting of the Benefits & Services Committee of the Board. It was relevantly as follows:[77]

• In accordance with Victorian Government policy, the 70% rule applies to all Contract Officers on TRP, inclusive of the employer superannuation contribution. This would cover UFU employees who are contract officers, such as Mr Marshall. If Mr Marshall does not agree with this position, he will need to provide a copy of the relevant sections of his employment contract for the Committee to reconsider this matter and determine whether 100% superable salary should apply to his personal circumstances. The Committee noted that a copy of the relevant sections of Mr Marshall's contract had been requested, but had not been provided.
• The salary in respect of the work Mr Marshall has conducted with the National UFUA is not superable salary for ES DB purposes. It is however considered Ordinary Times Earnings (OTE) and accordingly Superannuation Guarantee (SG) is payable on this salary at the applicable amount to an accumulation arrangement. It was noted that SG contributions have already been made at a rate of 17.5% to ESSSuper's Accumulation Plan, except for a period March 2015 to December 2015 where the funds were misdirected to the ES DB Scheme.

84 Those decisions were notified to Mr Marshall by letter from Mr Pearse on behalf of the Board on 22 May 2017.[78] Clearly, though, those were not the first representations the Board made to Mr Marshall about his superable salary or the components that did or did not form part of it. Rather, as also mentioned above, staff of the Board on certain occasions, before and after early 2017, made representations to Mr Marshall about the amount of his superable salary.

85 In grounds 3 and 4 of his notice of appeal, Mr Marshall contends that two of those representations made in 2014 and 2015 constituted the Board's exercising its powers of approval and that, by the operation of the principle or doctrine of functus officio, the Board's approval powers were spent by the 2014 and 2015 representations.[79] That is, Mr Marshall contended, the Board exercised the power to approve his superable salary once and for all in 2014 and 2015, so it could not then re-exercise the power in a different way, less favourably to Mr Marshall, in 2017.

86 In support of that argument, Mr Marshall relied heavily on the following statement of Gummow J in Minister for Immigration and Ethnic Affairs v Kurtovic ('Kurtovic'):[80]

[A] discretionary power reposed in the decision maker may, upon a proper construction, be of such a character that it is not exercisable from time to time and it will be spent by the taking of the steps or the making of the statements or representations in question, treating them as a substantive exercise of the power. The result is that when the decision maker attempts to resile from his earlier position, he is prevented from doing so not from any doctrine of estoppel, but because the power to do so is spent and the proposed second decision would be ultra vires. The matter is one of interpretation of the statute conferring the particular power in issue.

87 Although Mr Marshall appeals (and could only appeal) on a question of law,[81] a large portion of the submissions advanced on his behalf in his counsel's written submissions relating to grounds 3 and 4 was occupied with the facts. For that reason, it is necessary to set out some of the factual and evidential matters on which Mr Marshall relies, though it will also be necessary to return to the nature of the appeal.

88 The two representations on which Mr Marshall relies to ground his functus officio argument are set out in letters from the Board to Mr Marshall. Mr Marshall was querying his superannuation by email to Ken Doble, ESSSuper Manager, Member Education, from 24 June 2014, shortly before the first of the two representations. Both the representations are contained in documents styled as 'Annual Benefit Statements' and appear to have been prepared by staff of the Board and provided to Mr Marshall annually. In each case, the Annual Benefit Statement is attached to a short letter over the signature of the Chief Executive Officer of ESSuper. They appear to be largely standard-form documents provided to members of the emergency services superannuation scheme for the purposes of informing those members about the retirement benefits to which they may, depending on when they retire, be entitled under the scheme. Similar documents are in evidence relating to each financial year from the year ending June 2012 to the year ending June 2017,[82] save for the year ending June 2016.[83]

89 The letter introducing both documents is largely identical as between the 11 August 2014 document and the 11 August 2015 document. The 2014 letter relevantly reads:

Please find enclosed your 2014 Annual Benefit Statement. The statement shows your superannuation entitlements as at 30 June 2014. By clicking on the link below you can also access your copy of Super News. Check out the newsletter online now>>>.

It's important that you retain your 2014 Annual Benefit Statement and Super News, as together, they provide the information you need to understand your benefit entitlements, details of any additional benefits you may be entitled to (such as any death and disability benefits), and how your investments in the Accumulation Plan has performed over the longer term. It's important to remember that your benefits in the ESSS Defined Benefit Fund are not affected by changes in investment markets.

We're here to help

We want to make sure you're getting the most out of your super, so if you're thinking of resigning or retiring, or you're looking for ways to maximise your super, we're always available to help. Simply call our Member Services Centre, send us an email at info@esssuper.com.au or visit our website at www.esssuper.com.au.

90 The following pages in both documents set out details relevant to Mr Marshall's contributions to the scheme. Relevantly for present purposes, under the heading 'Personal details', along with other figures, the 2014 statement sets out the following entry:

Superable salary as 30 June 2014 [footnote] $354,406.56

91 The same figure is provided for the same entry under 'Personal details' in the 2015 statement. The footnote refers to a set of notes on the second to last page of each statement. In both documents, the footnote was the same, save for the relevant date. In the 2014 statement it read:

Your superannuation salary is equal to your gross salary at 30 June 2014 as advised by your employer to be the salary used for superannuation purposes.

92 Both documents also included disclaimers on the final page. The relevant part of the disclaimer in the 2014 document read:

This statement provides your benefit entitlements as at 30 June 2014. The figures provided are based on your personal details as shown, information currently available and data provided by your employer. Whilst every effort is made for complete accuracy, no responsibility or liability can be accepted for any errors. ESSSuper reserves the right to correct any errors or omissions. This statement is not intended to contain any recommendations, statements of opinion or advice.

93 The disclaimer in the 2015 document is very similar, though it notably says the figures are provided 'based on your personal details as shown and data provided by your employer'.[84] It does not mention 'information currently available' as did the 2014 document.

94 Despite those disclaimers, senior counsel for Mr Marshall contended, the Annual Benefit Statements were 'statements or representations' that constituted or evidenced the substantive exercise of the Board's approval power.[85] Because, senior counsel argued, the consequences of the exercise of the power were so serious for Mr Marshall, his employer, the Union, and the Board, the power must be exercisable once and for all. That is, because the interests of the people involved were so affected by its exercise, the power, once exercised, could not be re-exercised. That being the case, senior counsel for Mr Marshall argued, once the Board exercised the power in 2014 and 2015, the power was spent and the Board was functus officio so far as its power to approve Mr Marshall's superable salary for the relevant years was concerned.

95 In addition to the 2014 and 2015 Annual Benefit Statements, Mr Marshall relied on several other evidential matters to support his assertion that the Board had approved his superable salary in 2014 and 2015.[86] In particular, on 3 December 2015, Luke Nikoloski, Senior Superannuation Consultant for the Board, wrote an email to several colleagues in which he said, among other things:[87]

I then received a call from Ken Doble who explained that [Mr Marshall] has a special legal arrangement a couple of years ago to have his two position salaries merged as one figure and that it has been approved by Shane after receiving a UFU letter confirmation of salary.

96 Then, on 2 December 2015, Peter Russell, another employee of the Board, wrote an email to one or more colleagues.[88] In that email, Mr Russell said:

Ken [Doble] was aware that Shane Pearse had 'approved' the salary as under the act the employing authority determines the salary. Note Marshall is not an executive officer, yet seems to have a salary for the National secretary and Victorian secretary of the UFU.

97 Mr Marshall relied on those communications to contend that the 2014 and 2015 Annual Benefit Statements constituted or evidenced the Board's approval of his superable salary in the amount of $354,406.56.[89] Neither Mr Nikoloski, nor Mr Doble, nor Mr Russell were called before VCAT.[90] Mr Pearse denied that he had approved Mr Marshall's superable salary.[91]

98 Mr Marshall also said that Mr Doble told him over the phone that his superable salary was $354,000,[92] that 'the financial planning arm' of ESSSuper gave him advice 'based on a salary of $353,184',[93] and that another document provided to him by the Board and styled as a 'Member Exit Advice Quote' listed his salary as at 24 April 2014 as $354,397.05. Before VCAT, Mr Marshall contended that the latter document also constituted or evidenced the Board's approving his salary. Before this Court, Mr Marshall's argument morphed. On appeal, Mr Marshall said only that the Member Exit Advice Quote supported the contention that the Annual Benefit Statements constituted or evidenced the exercise of the power. He no longer contended, as I understood the submissions made on his behalf, that the Member Exit Advice Quote itself evidenced or constituted an exercise of the approval power. [94] Rather, Mr Marshall contended that each of the three representations made to him by the Board also indicated that, by issuing him the 2014 and 2015 Annual Benefit Statements, the Board had 'approved' his salary in the amount of $354,406.56, or alternatively, that those statements evidenced the Board's having done so.[95]

99 VCAT dealt with Mr Marshall's submissions on this point on the facts. It concluded:

I agree with the submission on behalf of the Board that no power of approval was exercised, either in respect of the notified salary of $354,401 or otherwise, until the Board made its first decision in March 2017.

100 Unsurprisingly, VCAT's reasons leading to that conclusion were also concerned primarily with the facts. It relevantly[96] held that the disclaimers set out in the Annual Benefit Statements made clear that the information contained in those statements reflected information available at the time the statements were issued and data provided by the contributor's employer. The Statements reflected information provided to the Board, not decisions made by the Board. In any event, Mr Marshall conceded before VCAT that the information that his employer, the Union, had provided to the Board and which was reflected in the Annual Benefit Statements was incorrect and, VCAT held, the Board was entitled to verify that information before making any approval decision.[97]

101 VCAT also accepted Mr Pearse's evidence that he was not involved in any decision of the Board to approve Mr Marshall's salary in the amount of $354,041 and that, in any event, Mr Pearse not being a member of the Board or its Benefits and Service Committee, he did not have power to make such a decision.[98] The internal correspondence in which Mr Nikoloski and Mr Russell referred to Mr Pearse's 'approving' Mr Marshall's superable salary could not, therefore, constitute an exercise of the Board's approval power. Rather, VCAT found, the figure of $354,041 appeared in the Annual Benefit Statements because it was entered into a computer system by a junior employee responsible for data entry. The documents Mr Marshall relied on, then, could not have evidenced, and certainly could not have constituted, an approval decision made by the Board. There being no contemporaneous record of an approval decision being made, VCAT concluded that none had been made at any time before March 2017.

102 Hence, VCAT found, the facts could not support a finding that the 2014 and 2015 Annual Benefit Statements rendered the Board functus officio.

103 The question of law that Mr Marshall raised under grounds 3 and 4 reads:

Is the statement by the first respondent of an employee's superable salary in the annual benefit statement provided to the employee evidence binding on the first respondent that it has approved the superable salary in that amount for the purposes of the ESS Act?

104 Before this Court, Mr Marshall only addressed two paragraphs of written submissions to the functus officio argument, and, as I have said, he pressed the point only faintly in oral submissions.[99] The two paragraphs of written submissions attacking VCAT's reasons on this point are sufficiently brief to set out in full. They read:[100]

This reasoning is not supportable. The annual benefits statements, member exit quotes, the financial adviser report and the December internal correspondence were clearly all contemporaneous records of a decision to approve the superable salary in the amount of approx. $354,000. Even if the amount was erroneously input into the first respondent's records by a junior employee (who was not called to give evidence) there was too much contrary evidence of acceptance of that amount by more senior people such as Mr Doble and Mr Nikoloski, yet VCAT failed to draw the obvious inference from the failure to call them. Finally, it cannot be accepted that Mr Pearse did not have authority to make the decision on behalf of the first respondent. He was the only witness offered by the first respondent to give evidence on its behalf at VCAT; his advice was followed invariably by the board in making its decisions on 9 March 2017 and 18 April 2017; and he signed on behalf of the first respondent the memorandum of 13 July 2017 rejecting the appellant's review of the earlier decisions.[101]

In the light of all these factors it should be concluded that the first respondent did approve the appellant's superable salary for 2013/2014 and 2014/2015 in the amount of $354,406.56, that it was functus officio once it had made those decisions and that its purported subsequent decision to the effect that the superable salary was less were ultra vires and of no effect. VCAT erred in law in deciding otherwise.

105 The first paragraph quoted above is made up entirely of submissions of fact. It is true, as Mr Marshall submitted, that whether particular facts fall within a particular legal characterisation is a question of law.[102] But the first quoted paragraph has no attachment at all to the legal characterisation mentioned in the second quoted paragraph. The conclusion that Mr Marshall challenges in the above paragraphs is not that the facts as VCAT found them do not fall within the legal concept of an approval decision. The conclusion is that no one who could have made a decision falling within that concept played any role in the representations Mr Marshall alleges constitutes an approval decision. In VCAT's view, the only entity that could have made an approval decision (the Board) did not do take any action at all relating to Mr Marshall at any time proximate to the alleged approval decision. That is, VCAT did not merely conclude, against Mr Marshall, that the facts did not meet the relevant legal characterisation. VCAT concluded that the facts Mr Marshall argues constitute an approval decision did not occur. That is a pure conclusion of fact. It is not open to challenge in this appeal.

106 For those reasons, it is unnecessary to deal with a legal question that is raised in Mr Marshall's notice of appeal, namely, whether the approval power is exercisable once and for all, or from time to time. For my part, however, I have serious doubts about the submission made by senior counsel for Mr Marshall that, because the consequences of an approval decision are serious, the power must be exercisable once and for all. To begin with, Mr Marshall's submission drew, properly, on Gummow J's dictum in Kurtovic quoted above. In that case, the Court of Appeal held that the power to revoke a person's visa was exercisable from time to time. It can hardly be said that the power to revoke a visa carries less serious consequences than the approval power under the ESS Act. On the other hand, there is recent High Court authority suggesting that the fact that a power is subject to merits review by a tribunal tends to indicate that the power is exercisable once and for all.[103]

107 Despite my reservations, I express no final view on that question. It is unnecessary for me to do so.

108 To the extent that Mr Marshall sought to rely on estoppel as distinct from the doctrine of functus officio, the attempt was hopeless. VCAT's reasons for rejecting the estoppel claim on the facts are unimpeachable. It is not necessary to determine whether VCAT might have gone too far in saying, in effect, that an estoppel claim can never succeed in a merits review proceeding at VCAT.[104]

109 As indicated above, leave to appeal will be granted and the appeal will be allowed. It will be allowed on the appellant's principal interpretation point only. No other point needs to be decided, and some of the points should not be decided.

110 The matter will be remitted to VCAT for rehearing and re-determination in accordance with law. The question whether VCAT should be reconstituted for the rehearing should be left to the proper authority at VCAT. In any event, the parties have foreshadowed that they may all be content for VCAT to further remit the matter to the Board to be reconsidered on up to date material.

111 Costs will be reserved. The parties are invited to consult with each other about costs and to notify my chambers within two weeks as to whether agreement has been reached or whether a hearing on costs is sought.

[1] Marshall v Emergency Services Superannuation Board & Anor [2021] VSC 225.

[2] United Firefighters' Union of Australia & Marshall v Emergency Services Superannuation Board (Review and Regulation) [2019] VCAT 594 ('VCAT's reasons').

[3] [2021] VSC 225, [14].

[4] Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150, 163.

[5] (1998) 73 ALJR 129, 133 [21].

[6] Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd [1979] FCA 21; (1979) 24 ALR 307.

[7] (1989) 169 CLR 379.

[14] Telstra Corporation Ltd v Minister for Broadband, Communications and the Digital Economy (2008) 166 FCR 64, 76 [47], 78 [54] (French, Weinberg and Greenwood JJ).

[15] See Marshall v Emergency Services Superannuation Board & Anor [2021] VSC 225, [16]-[17].

[16] Superannuation Acts (Amendment) Act 2000 (Vic) s 5.

[17] I will direct that copies of the parties' written submissions of 25 May 2021, the Court's memorandum of 26 May 2021 and the transcript of the hearing on 27 May 2021 be kept on the file.

[18] Taylor v Owners-Strata Plan No 11564 (2014) 253 CLR 531, 548 [37]-[38].

[19] [2021] VSC 225, [4].

[21] See MZAPC v Minister for Immigration and Border Protection (2021) 390 ALR 590, 592 [2], 598-600 [34]-[39] (Kiefel CJ, Gageler, Keane and Gleeson JJ).

[22] Emergency Services Superannuation Act 1986 (Vic) (ESS Act) 20AA, 20Q.

[27] Dennis Pearce, Statutory Interpretation in Australia (LexisNexis Butterworths, 9th ed, 2019) [6.12] citing, among other authorities, Tjumgarrayi v Western Australia [2019] HCA 12, [89].

[28] Section 3(1) defines 'contributor' in a fashion that covers Mr Marshall.

[29] It will be seen below that in a predecessor definition contained in regulations made under the Act, the provision included the words 'salary means' in the corresponding position.

[32] Compare paragraph (a) of the definition of 'salary' in s 3(1) of the Act. And see further below.

[33] Ian Neil and David Chin, The Modern Contract of Employment (Thomson Reuters, 2nd ed, 2017) [1.10] citing, among other sources, Westpac Banking Corporation v Wittenberg [2016] FCAFC 33; (2016) 242 FCR 505, [69].

[34] Brown v R [1886] VicLawRp 117; (1886) 12 VLR 397, 412; Lucy v Commonwealth [1923] HCA 32; (1923) 33 CLR 229.

[35] Attorney-General (NSW) v Perpetual Trustee Co (Ltd) [1952] HCA 2; (1952) 85 CLR 237.

[36] Coutts v Commonwealth [1985] HCA 40; (1985) 157 CLR 91.

[37] Frederick v South Australia [2006] SASC 165; (2006) 94 SASR 545.

[38] Fair Work (Commonwealth Powers) Act 2009 (Vic) Sch s 30E.

[39] See Victoria Police (Police Officers, Protective Services Officers, Police Reservists and Police Recruits) Enterprise Agreement 2019, made under the Fair Work Act 2009 (Cth).

[40] See Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2020] HCA 29, especially at [95]-[96] (Edelman J).

[41] Explanatory Memorandum, Superannuation Acts (Further Amendment) Bill 1996, 1.

[42] Note the omission of the word 'Scheme' from the explanatory memorandum as quoted above.

[43] My emphasis. This is the expression later omitted, apparently by mistake, in the corresponding place in the regulations as amended in 1995 (see below); and in the Act as amended in 1996 and as it presently stands, as mentioned above.

[44] The amendment had retrospective effect, from 1 January 1994.

[45] Here, a new reg 3(1A) was inserted, such that, unlike in the regulations as originally made, the reg 3(1) and reg 3(2) parts of the definition of salary did not follow the one from the other. The new reg 3(1A) did not include parts of the definition of salary.

[46] Sub-regulation 3(2)(a) was repealed.

[50] PSM Act s 4 (definition of 'executive officer').

[51] PSM Act s 4 (definition of 'chief executive officer').

[57] PSM Act ss 49 (definition of 'employment benefit', 'monetary remuneration', remuneration package' and 'superannuation scheme', s 51, 60(2)).

[60] PSM Act s 49 (definition of 'contract of employment').

[62] Public sector employment between 1998 and 2004 was primarily regulated by the Public Sector Management and Employment Act 1998 (Vic), which similarly included a scheme by which executives were engaged under contracts of employment: see s 23.

[64] SS Act s 3(2)(c), TS Act s 3(3)(a) and SERB Act s 2(3)(a) all refer back to the definition in s 12 of the SPS Act mentioned above.

[66] SS Act s 3 (definition of 'contract officer'). Some contract officers were exempt: see SS Act s 3 (definition of 'exempt officer').

[67] The exception is that, under s 3 of the SS Act, the Minister could deem a person to be a contract officer. If a person was so deemed to be a contract officer, their salary for superannuation purposes would be as determined in their contract of employment. The deeming provision appears likely only to have been used for persons whose employment arrangements mirrored those of contract officers in any event. The exception, to my view, does not assist one to understand the use of the word 'contract of employment' in the ESS Act.

[68] ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1, [29]; Superannuation Commission v Frame [2020] TASFC 5, [94].

[72] PSM Act ss 49 (definition of 'employment benefit', 'monetary remuneration', remuneration package' and 'superannuation scheme'), s 51, 60(2).

[75] See especially VCAT's reasons, [258]-[284].

[76] VCAT's reasons [35]; TJD2 CB 445.

[77] VCAT's reasons [36]; TJD2 CB 461.

[79] Notice of appeal CB 3. At VCAT, Mr Marshall had contended that three such prior representations constituted exercises of the approval power. However, Mr Marshall's notice of appeal and outline of submissions make clear that his appeal to this Court concerns VCAT's findings relating only to the two representations with which I deal below: Mr Marshall's outline of submissions before this Court dated 26 September 2019 ('Mr Marshall's outline') [113]. It is, for that reason, unnecessary for me to consider the third asserted representation: see VCAT's reasons [101]-[114].

[81] Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (2001) 207 CLR 72, [15].

[82] TJD2 CB 476-481, 468-473, 482-488, 497-503, 489-496.

[83] Mr Marshall's written outline [31].

[88] It is not entirely clear from the document in evidence who received Mr Russell's email: TJD2 CB 365-366.

[94] TJD2 CB 516, Mr Marshall's outline: [113]. Cf VCAT's reasons [96], Mr Marshall's outline [121].

[96] As mentioned above, Mr Marshall no longer argues that the Member Exit Advice Quotes constitute or evidence approval decisions. For that reason, I do not set out VCAT's reasons so far as they address that argument.

[99] See, eg, Transcript of oral hearing dated 28 May 2020, 4 ('T').

[100] Mr Marshall's outline [123]-[124].

[101] I interpolate that, consistently with what I have said above, in my view, the memorandum of 13 July 2017 was clearly no more than a statement of reasons for the Committee's decisions.

[102] Mr Marshall's reply submissions dated 10 December 2019, [2]. S v Crimes Compensation Tribunal [1998] 1 VR 83; Cosmopolitan Hotel (Vic) Pty Ltd v Crown Melbourne Ltd [2014] VSCA 353, [49] (Warren CJ), [167] (Whelan JA, Santamaria JA agreeing), reversed on appeal on different grounds, special leave refused on the relevant question: Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd [2016] HCA 26; (2016) 260 CLR 1.

[103] Minister for Immigration and Border Protection v Makasa [2021] HCA 1; (2021) 95 ALJR 117, [50].