Baljas v Repatriation Commission

Federal Court of Australia|2009-03-02|Before: Gray J

The nature and history of the proceeding 1 The issues in this appeal from a decision of the Administrative Appeals Tribunal ("the Tribunal") concern the Tribunal's application of s 24 of the Veterans' Entitlements Act 1986 (Cth) ("the VE Act"). The principal concern of the applicant is whether the Tribunal applied the correct test in determining whether the applicant should be entitled to pension at the special rate, pursuant to s 24 of the VE Act, on the basis that incapacity from war-caused diseases alone prevented him from continuing to undertake remunerative work that he had been undertaking, and thereby caused him to suffer a loss of salary or wages that he would not be suffering if he were free of that incapacity. By s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act"), the appeal is limited to questions of law. 2 The applicant was born on 1 November 1946. He was conscripted into the Army in 1967 and rendered operational service in Vietnam between 15 March 1968 and 2 April 1969. Subsequently, the Repatriation Commission ("the Commission"), the respondent to this appeal, accepted as war-caused a number of medical conditions from which the applicant suffered: bilateral sensorineural hearing loss; bilateral tinnitus; hypertension; non melanotic malignant neoplasms of the skin; post traumatic stress disorder; impotence; and alcohol dependence. Originally, the Commission granted the applicant a disability pension at 90% of the general rate. On 19 May 2005, by decision of the Commission, this was increased to 100% of the general rate. On 7 June 2005, the applicant applied to the Veterans' Review Board to review that decision, claiming he was eligible for pension at the special rate. This application was rejected and the applicant sought review of the decision of the Veterans' Review Board by the Tribunal. 3 The Tribunal's decision and reasons for decision were published on 20 March 2008. The Tribunal affirmed the decision of the Veterans' Review Board that the applicant was not entitled to pension at the special rate.

The legislation 4 The liability of the Commonwealth to pay pension to a veteran is established, for the purposes of this case, by s 13(1)(b) and (d) of the VE Act, in a case where a veteran is incapacitated from a war-caused disease. By s 14(1), a veteran may make a claim for a pension. By s 15(1), a veteran who is in receipt of a pension may apply for an increase in the rate of the pension on the ground that the veteran's incapacity has increased since the rate of the pension was assessed or last assessed. Section 19 deals with the manner in which the Commission is to determine claims and applications. Section 22 prescribes the general rate of pension and the extreme disablement adjustment. Section 23 prescribes the intermediate rate of pension. Section 24 deals with the circumstances in which the special rate of pension is applicable, and prescribes that rate. Relevantly for the present case, it provides as follows: (1) This section applies to a veteran if: (aa) the veteran has made a claim under section 14 for a pension, or an application under section 15 for an increase in the rate of the pension that he or she is receiving; and (aab) the veteran had not yet turned 65 when the claim or application was made; and (a) either: (i) the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be at least 70% or has been so determined by a determination that is in force; or (ii) the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and (b) the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and (c) the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity... (2) For the purpose of paragraph (1)(c): (a) a veteran who is incapacitated from war-caused injury or war- caused disease, or both, shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, by reason of that incapacity if: (i) the veteran has ceased to engage in remunerative work for reasons other than his or her incapacity from that war- caused injury or war-caused disease, or both; or (ii) the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason; and (b) where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking. 5 Section 119(1) of the VE Act, so far as relevant to the arguments advanced in the present case, provides: In considering, hearing or determining, and in making a decision in relation to: (a) a claim or application... the Commission: (f) is not bound to act in a formal manner and is not bound by any rules of evidence, but may inform itself on any matter in such manner as it thinks just; (g) shall act according to substantial justice and the substantial merits of the case, without regard to legal form and technicalities; and (h) without limiting the generality of the foregoing, shall take into account any difficulties that, for any reason, lie in the way of ascertaining the existence of any fact, matter, cause or circumstance, including any reason attributable to: (i) the effects of the passage of time, including the effect of the passage of time on the availability of witnesses; and (ii) the absence of, or a deficiency in, relevant official records, including an absence or deficiency resulting from the fact that an occurrence that happened during the service of a veteran, or of a member of the Defence Force or of a Peacekeeping Force, as defined by subsection 68(1), was not reported to the appropriate authorities.

The Tribunal's reasons 6 The learned member who constituted the Tribunal identified as the only issue before him the question whether the applicant satisfied the requirements of s 24 of the VE Act. After reviewing the vague and contradictory evidence of the applicant's work history, reciting the history of his claims and applications, and summarising the legislative scheme, the Tribunal expressed a finding about the remunerative work that the applicant was undertaking after his military service. In doing so, the Tribunal reminded itself of the proposition found in Repatriation Commission v Hendy [2002] FCAFC 424 (2002) 76 ALD 47 at [36], where the Court said: The tribunal's task was to assess what the veteran probably would have done, if he had none of his service disabilities during the assessment period. The requirement to consider "remunerative work that the veteran was undertaking" does not mean a particular job with a particular employer but the substantive remunerative work that the veteran had undertaken in the past. 7 The Tribunal found that, after leaving the army, the applicant worked for some 24 years doing plumbing and welding work associated with the installation of commercial air-conditioners. He was then employed by Haden Engineering installing air-conditioning units and ducting in commercial and industrial premises. The applicant has a plumbing certificate from RMIT. The Tribunal found that the relevant remunerative work which the applicant was undertaking was that of an air-conditioning plumber or installer. That task involved significant manual work, including the lifting of heavy items and work in confined spaces and awkward positions. 8 The Tribunal then addressed the cause of the applicant's incapacity for work, particularly the application of the "alone" test, found in s 24(1)(b) and (c) of the VE Act. At [28] of its reasons for decision, the Tribunal said: It should therefore be apparent that if any factors other than Mr Baljas' accepted medical conditions prevent him from continuing to undertake the remunerative work that he was undertaking, he will not be eligible for a pension at the special rate. 9 The Tribunal then found that, pursuant to s 19(6) of the VE Act, the assessment period for the purpose of its determination began on the day on which the applicant's application was made (12 May 2004) and finished on the date of the Tribunal's decision. The Tribunal also reminded itself of the provisions of s 24(2) of the VE Act. 10 The Tribunal discussed the evidence at length, including a substantial amount of expert medical evidence. Its conclusion was expressed at [47]: Because Mr Baljas suffered an injury to his shoulders which was not related to his service with the Army, and that injury plays a part in preventing Mr Baljas from continuing to undertake the remunerative work that he was previously undertaking, it is nevertheless sufficient to preclude him from satisfying the alone test. In addition to that, he has now been out of the workforce for some seven years and, with his limited education, he is unlikely to be able to retrain so that he could undertake alternative employment. Coupled with his age, these factors also play a part in his inability to continue to undertake remunerative work. Clearly, in my opinion, Mr Baljas does not meet the alone test set out in s 24 of the Act.

The Tribunal's approach to the "alone" test 11 The principal issue for the Tribunal to decide involved the application of the "alone" test to the facts. That is to say, the Tribunal had to determine whether the applicant was, by reason of his war-caused incapacity alone, prevented from continuing to undertake remunerative work that he had been undertaking. This was the issue the Tribunal had to determine by reference to s 24(1)(c) of the VE Act. For the purpose of this determination, s 24(2)(a) made it clear that, if the applicant had ceased to engage in remunerative work for reasons other than the war-caused incapacity, or was incapacitated or prevented from engaging in remunerative work for some reason other than the war-caused incapacity, the "alone" test would not be satisfied. In [47] of its reasons for decision, the Tribunal made a clear finding that the injury to the applicant's shoulders, coupled with the other factors it identified that were not war-caused, played a part in preventing him from continuing to undertake the remunerative work that he was previously undertaking. On this basis, he was unable to satisfy the "alone" test. 12 Counsel for the applicant advanced in this appeal various arguments to the effect that the Tribunal had failed to apply s 24(1)(c) and (2)(a) correctly in reaching this finding. Some of these arguments were disguised attempts to invite the Court to revisit the Tribunal's findings of fact, including its ultimate finding as to the effect of the injury to the applicant's shoulders. It is necessary to identify and examine each of the arguments advanced. 13 Counsel for the applicant took issue with the Tribunal's characterisation of its task in [28] of its reasons for decision. In that paragraph, the Tribunal said that "if any factors other than [the applicant's] accepted medical conditions prevent him from continuing to undertake the remunerative work that he was undertaking, he will not be eligible for a pension at the special rate." The contention was that this was a misstatement of the test as to whether the applicant's disabilities alone prevented him from continuing to undertake remunerative work that he was undertaking, thereby causing a loss of income he would otherwise be receiving. The contention was that the Tribunal applied a test more onerous than it should have. I am unable to discern the difference between the statement of the test by the applicant's counsel and the statement of the test by the Tribunal in [28] of its reasons for decision. As a shorthand method of stating the test laid down in s 24(1)(c) and (2)(a) of the VE Act, what the Tribunal said in [28] was perfectly adequate. In any event, what the Tribunal actually did in [47] of its reasons for decision was to apply that test correctly. Its clear finding of fact that the injury to the applicant's shoulders played a part in preventing the applicant from continuing to undertake the remunerative work that he was previously undertaking was decisive in the determination that the applicant did not meet the "alone" test. There was undoubtedly evidence on which the Tribunal could properly have made, and did make, this finding of fact. 14 Counsel for the applicant contended that the Tribunal took the wrong approach to determining what was the remunerative work that the applicant was prevented from continuing to undertake. It was said that the correct approach was to determine, as a matter of hypothetical fact, an assessment of what the applicant "probably would have done if he had none of his service disabilities": Repatriation Commission v Smith (1987) 15 FCR 327 at 337 per Beaumont J, with whom Northrop and Spender JJ concurred. Further, the phrase "remunerative work which the respondent was undertaking" in s 24(1)(c) must be "read as a reference to the type of work which the member previously undertook and not to any particular job": Banovich v Repatriation Commission (1986) 69 ALR 395 at 402. The argument was that the Tribunal had restricted itself to a consideration of the actual job that the applicant had been employed to perform by Haden Engineering, and had not considered either the nature of his work in general, or other work that he might have performed but for his war-caused incapacity. 15 These contentions are unfounded. At [24] of its reasons for decision, the Tribunal identified the relevant remunerative work as that of "an air-conditioning plumber/installer", involving significant manual work, including the lifting of heavy items and work in confined spaces and awkward positions. This was the type of work that the applicant had been doing for some 24 years before the injury to his shoulders. The applicant did not give to the Tribunal any evidence suggesting that he would have been able to undertake work of some other type. In the course of re-examining him before the Tribunal, counsel for the applicant asked the applicant what he thought he would be doing at that time if he did not have his war-caused conditions. The applicant responded "There's a lot of things." Counsel for the applicant did not follow up this answer by asking for any specification of the kinds of things the applicant contemplated. Instead, he asked, "Would you still be with the firm that you were with originally?" The applicant replied "Well, it's quite possible." There was no evidence to support the submission, made by counsel for the applicant at the hearing of this appeal, that the Tribunal should have considered other forms of plumbing work that the applicant might have undertaken. In any event, the Tribunal did make other relevant findings of fact at [47] of its reasons for decision. It found that the applicant had been out of the workforce for some seven years and, with his limited education, was unlikely to be able to retrain so that he could undertake alternative employment. Coupled with the applicant's age, these factors played a part in his inability to continue to undertake remunerative work. In other words, they were factors contributing to the applicant's inability to meet the "alone" test. 16 Counsel for the applicant attempted to argue that the Tribunal had wrongly applied s 24(2)(a) by focussing on the time when the applicant first suffered his shoulder injuries, and failing to take into account the repair of his shoulders by surgery, his return to work and the effect of his war-caused disabilities in preventing him from availing himself of an offer of an office job with his former employer. The Tribunal was far from falling into any such error. The applicant's return to work on light duties is the subject of references in [13], [30] and [35]. It is impossible to imagine that the Tribunal did not take into account the period of return to work on light duties. In any event, the Tribunal found that the applicant did not meet the "alone" test in s 24(1)(c) of the VE Act during the relevant assessment period, a finding that was fatal to the applicant's case, whatever was the date on which he was found to have ceased work. 17 Finally, counsel for the applicant contended that the Tribunal did not take account of the applicant's evidence that the injury to his shoulders in 2000 was not the reason he had not been able to undertake his work as a plumber, but after his return to work he ceased work again because of his war-caused conditions. In fact, the Tribunal rejected this proposition, partly because of the view it took of the medical evidence. It had ample basis for doing so. Its conclusion was one of fact, and cannot be challenged in an appeal of this nature, which is limited to questions of law. 18 The applicant has failed to establish that the Tribunal did not apply s 24(1)(c) and (2)(a) of the VE Act correctly.

The "ameliorating" provision 19 Counsel for the applicant argued that the Tribunal was bound to apply s 24(2)(b) of the VE Act as a provision ameliorating the effect of s 24(1)(c). Relying on Sheehy v Repatriation Commission (1996) 66 FCR 569 at 573-574, counsel contended that the applicant's remunerative activity had ceased on his suffering of the injury to his shoulders. After that, he became a person "who has not been engaged in remunerative work". The Tribunal should have seen his return to work on light duties as not engaging in remunerative work, because the attempt was unsuccessful, but should have seen that attempt as evidence that the applicant "has been genuinely seeking to engage in remunerative work". 20 In Giesen v Repatriation Commission [2005] FCA 846 (2005) 87 ALD 347 at [19]-[26], I set out the reasoning that led me to the view that s 24(2)(b) is not construed properly as an ameliorating provision in a case such as the present. Section 24(1)(c) of the VE Act deals with a person who has been "prevented from continuing to undertake remunerative work that the veteran was undertaking", ie with someone who has worked. The purpose of s 24(2)(b) is to enable a person who cannot fit into this category, because of never having worked since his or her relevant war service, to claim pension at the special rate if he or she can satisfy the requirements of s 24(2)(b). For the reasons I gave in Giesen, I remain of the view that s 24(2)(b) has no application to the present case. In Giesen at [27], however, I indicated that I was prepared to consider the application of s 24(2)(b), on the basis that both parties took the view that it was applicable. In the present case, both parties also expressed the view that s 24(2)(b) is an ameliorating provision, applicable even where a veteran has ceased to engage in remunerative work. 21 The attempt to rely on Sheehy, and to argue that the period of light duties undertaken by the applicant after he had suffered the injury to his shoulders was not itself engaging in remunerative work, appears to be a device adopted by counsel for the applicant to overcome the fact that there was no evidence at all that the applicant had been genuinely seeking to engage in remunerative work, or would have been so seeking but for his war-caused incapacity. In Sheehy, the Full Court held that a veteran could not be said to "undertake" remunerative work, or to have been "undertaking" such work unless he or she had managed to perform such work, to undertake it successfully or effectively. In that case, it had become apparent within a week of the return to work that the veteran concerned was unable to cope with his duties. In the present case, the return to work persisted for three months, according to the applicant's evidence. His evidence was that he started off doing all light duties and "then all of a sudden we're back to normal." He indicated that he was carrying heavy items and doing work of a kind he had done usually. At least for that period, it was clear that the applicant's own evidence was that he was undertaking that work. There was no occasion for the Tribunal to make a finding that the three-month period of return to work should have been disregarded in the determination of what remunerative work the applicant had been undertaking. 22 The result of this analysis is that there was no evidence that the applicant had been seeking to engage in remunerative work, or would have been so seeking but for his war-caused incapacity. He declined an approach by his former employer to be retrained for an office job. There were suggestions in cross-examination that he was reluctant to engage in employment, because there were no jobs within a reasonable distance of his home, and because he had responsibility for caring for young children at his home. On the evidence, no occasion arose for the Tribunal to consider the application of s 24(2)(b). Any finding that the applicant had been seeking to engage in remunerative work, or would have done so but for his war-caused incapacity, would have been perverse.

Leniency to the applicant 23 Counsel for the applicant also put the well-worn argument that the Tribunal had failed to take account of the beneficial nature of s 24 of the VE Act, and had disregarded the requirements of s 119 of the VE Act. This was said to have been demonstrated by the Tribunal in a number of ways. One was simply noting conflicting evidence, without attempting to resolve the conflicts and particularly without asking the applicant or his counsel to clarify the situation. Another was the Tribunal finding that the applicant had stopped work due to bilateral arm pain, and allegedly ignoring his evidence that he was not able to cope with work because of the medication he was taking for other conditions. Yet another was the Tribunal improperly restricting the nature of remunerative work that it considered, but considering only the particular job that the applicant had been performing prior to his injury. Another was failing to identify the type of work that the applicant was capable of doing and trained to perform, which allegedly led the Tribunal to fail properly to identify the effect of the accepted war-caused disabilities on the applicant's ability to continue with or resume remunerative employment. Finally, it was suggested that the Tribunal failed to determine whether the accepted disabilities were the substantial cause of the applicant's inability to obtain work. 24 The last of these submissions was an attempt to put the s 24(2)(b) argument in another guise. The remaining ones were attempts to persuade this Court to intervene in the fact-finding process of the Tribunal. Neither the beneficial nature of the legislation, nor any aspect of s 119 of the VE Act, extends to overriding the express provisions of the VE Act. The Tribunal was applying s 24(1)(c) of the VE Act. As I have held, it applied it correctly as a matter of law. There was ample evidence on which the Tribunal could reach the factual conclusions it reached.

The adequacy of reasons 25 Relying on s 43(2B) of the AAT Act, counsel for the applicant argued that the Tribunal had failed to provide adequate reasons for its decision. Section 43(2B) requires the Tribunal to include in its reasons findings on material questions of fact and a reference to the evidence or other material on which those findings were based. The alleged inadequacy of the reasons was never particularised. I have read the Tribunal's reasons carefully and am unable to fault them. The evidence was summarised appropriately and the process of reasoning of the Tribunal is apparent. Based on the evidence, the Tribunal made a crucial finding adverse to the applicant, which meant that he was unable to satisfy the "alone" test in s 24(1)(c) of the VE Act. As I have said, the finding that there were factors other than the war-caused disabilities that prevented the applicant from continuing to engage in remunerative work that he had been undertaking was fatal to the applicant's case. Again, counsel for the applicant cannot invite this Court to intervene in the fact-finding process under the guise of attacking the adequacy of the Tribunal's reasons.

Conclusion 26 The applicant has failed to establish that the Tribunal made any error of law in its approach to the applicant's case. The appeal must be dismissed. No reason was advanced, and none appears from the nature of the case, why the usual rule, that costs follow the event, should not be followed. Accordingly, the applicant will be ordered to pay the Commission's costs of the appeal. I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gray.

Associate: Dated: 2 March 2009 Counsel for the Applicant: Mr D De Marchi

Solicitor for the Applicant: De Marchi & Associates

Solicitor for the Respondent: Australian Government Solicitor

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