Did the Tribunal exercise its powers of review in accordance with law?
43 No-one questioned the competency of the proceeding, however, until we raised this matter with counsel during the hearing of the appeal. The appellant stated that the case before the primary judge was run on the basis that the question was whether or not the Tribunal had asked itself the correct question and misdirected itself as to the nature of its powers of review. Mr Edington's counsel did not apparently dispute this. Whilst a question of this kind would be capable of being characterized as a question of law, as we have seen, it finds only limited support in the notice of appeal discussed above. Notwithstanding our doubts about the constitution of the appeal, however, we consider that, on balance, the proceeding below was not entirely incompetent. Hence, we discuss hereafter, whether or not, for the reasons his Honour gave, the Tribunal failed to exercise its powers of review as required by s 37 of the Complaints Act.
44 Mr Edington made a complaint to the Tribunal pursuant to s 14(2) of the Complaints Act, which, as stated above, allows a member of a regulated superannuation fund to complain to the Tribunal that a decision made by the trustee of that fund is unfair or unreasonable. The role of the Tribunal was to decide whether or not the decision made by the Board of Trustees to affirm its previous decision that Mr Edington was not entitled to an insurance benefit for his 21 units was fair and reasonable in relation to him in all the circumstances: see, e.g., Vision Super Pty Ltd v Poulter (2006) 154 FCR 185 at 192 [30] (Young J) and National Mutual Life Association of Australia Ltd v Jevtovic (1997) 217 ALR 316 at 321 (Sundberg J). "Unreasonable" and "unfair" have been said to be "words of broad content", which are not readily defined. The use of synonyms and definitions as interpretational aids has been discouraged: see National Mutual Life Association of Australia Ltd v Campbell (2000) 99 FCR 562 at 571 [36] (Black CJ, Emmett and Hely JJ).
45 Various provisions of the Complaints Act show that, relevantly, a function of the Tribunal is to conduct a form of administrative review of decisions made by trustees of regulated superannuation funds, which are challenged by relevant persons as unfair or unreasonable: see, e.g., ss 12, 14, 37, and 41. A hearing before the Tribunal is a hearing de novo, following which the Tribunal makes findings of fact relevant to its deliberations: see Attorney-General (Cth) v Breckler (1999) 197 CLR 83 at 128 [87] (Kirby J); Lykogiannis v Retail Employees Superannuation Pty Limited (2000) 97 FCR 361 at 372 [48] (Mansfield J), citing Seafarers' Retirement Fund Pty Ltd v Oppenhuis (1999) 94 FCR 594 at 599 [19]-[23] (Merkel J).
46 Under the Complaints Act, the Tribunal is not called on to make the same kind of determination as the Administrative Appeals Tribunal under its governing legislation. That is, in contrast to the Administrative Appeals Tribunal, the Tribunal under the Complaints Act is not called upon to determine whether the trustee made the correct or preferable decision: see, e.g., Jevtovic 217 ALR at 322; Cameron v Board of Trustees of the State Public Sector Superannuation Scheme (2003) 130 FCR 122 at 132-133 [38]-[43] (Whitlam, Kiefel and Dowsett JJ); and National Mutual Life Association of Australia Limited v Scollary [2002] FCA 695 at [37] (Ryan J). Rather, the Tribunal stands in the shoes of the trustee and determines, based on all the information before it, whether or not a decision taken by the trustee was fair or reasonable in the circumstances. In Jevtovic 217 ALR at 321, Sundberg J held that the words "the decision … was fair and reasonable" in s 37(6) were directed to whether the actual decision, rather than the process that led to it, was fair and reasonable, a proposition that has subsequently been accepted as correct: see, e.g., Citicorp Life Insurance [2005] FCAFC 102 at [19]; and Colonial Mutual Life Assurance Society Limited v Brayley [2002] FCA 1333 at [31] (Branson J).
47 If the Tribunal is satisfied that the decision of the trustee was not fair and reasonable, the Tribunal makes a decision that is fair or reasonable in substitution for the decision of the trustee, always providing that the Tribunal cannot do anything contrary to law, the rules of the fund, or the terms of insurance: see ss 37(3), (4), (5) and 41(3); also Briffa v Hay (1997) 75 FCR 428 at 437; Breckler 197 CLR at 129 [88]; and, recently, Machin v Board of Trustees of the State Public Sector Superannuation Scheme [2010] FCA 969 at [82] (Dodds-Streeton J).
48 As Kirby J said in Breckler 197 CLR at 129 [89], with respect to a decision made by the Tribunal in substitution for that of the trustee:
The new decision, which might have retrospective operation, will speak from the time specified in the determination. What is involved is not a determination that the trustees misapplied the law to the facts. Nor that they mistook their powers and obligations under the governing rules of the fund. Rather it is a determination by the Tribunal of its own opinion that the trustees' decision is, or was, unfair, unreasonable or both. It is the reaching of that opinion which authorises the Tribunal, conforming with s 37(5) of the Complaints Act, to exercise its own determination-making power and to substitute a fresh decision. The object of the determination is to effect the purpose of removing the unfairness and unreasonableness which the Tribunal has determined to exist [Superannuation (Resolution of Complaints) Act 1993, s 37(4)]].
If, however, the Tribunal is satisfied that, in the circumstances, the decision of the trustee was fair and reasonable in its operation in relation to the complainant, it must affirm the decision: see s 37(2) and (6).
49 The Complaints Act does not specify the considerations that the Tribunal is bound to take into account in deciding whether or not a decision of the trustee was fair or reasonable: see, in this regard, HEST Australia Ltd v Sykley (2005) 147 FCR 248 at 261 [49] (Crennan J). These considerations must therefore be determined by reference to the subject-matter, scope and purpose of the Act: see generally Minister for Aboriginal Affairs v Peko-Wallsend (1986) 162 CLR 24 at 39-40. A purpose of the Act is "to ensure members and beneficiaries are not adversely affected by unfair and unreasonable decisions of insurers and trustees": see HEST 147 FCR at 261 [49]. Considered in this light, the governing trust deed and insurance terms will necessarily be relevant considerations: see Retail Employees Superannuation Pty Ltd v Crocker (2001) 48 ATR 359 at 366 [28] (Allsop J) and Cameron 130 FCR at 131 [32]. This is because an essential part of the statutory scheme is that a determination under s 37(3) substitutes the Tribunal's decision for the decision of the trustee; and in consequence, the substituted decision must itself be one that is authorised by the legal instruments governing the fund: compare Briffa v Hay 75 FCR at 443 (Merkel J).
50 Furthermore, since the Tribunal hearing is a hearing de novo, the Tribunal is not "restricted to the documents which were before the trustee, nor is it confined to the manner in which the applicant addressed the subject matter": see HEST 147 FCR at 259 [40], citing Commonwealth Superannuation Scheme Board v Dexter [2004] FCA 1434 at [59]-[60] (Gray J), Crocker 48 ATR 359 at 387-388 [132]-[133], and Oppenhuis 94 FCR at 598-599. It must be borne in mind, however, that, notwithstanding the Tribunal has "all the powers, obligations and discretions that are conferred on the trustee" (s 37(1)(a)), the Tribunal is primarily concerned with the question whether or not the decision of the trustee was fair and reasonable. The whole of its inquiry, including its fact-finding, is directed to answering this question. As Mansfield J said in Lykogiannis 97 FCR at 372 [48]:
Ultimately, whatever findings the Tribunal must make standing in the shoes of the trustee … s 37(6) requires the Tribunal to decide whether the decision under review, in its operation, was fair and reasonable in the circumstances. The focus of s 37(6) is upon the consequence or outcome of the decision in its practical operation, rather than upon the process by which the decision under review came to be made.
In Hornsby v Military Superannuation and Benefits Board of Trustees (No 1) (2003) 126 FCR 484, Mansfield J also said at 492 [19]-[20]:
[T]he Tribunal may have to make its own findings of fact for the purpose of determining whether, in its opinion, the decision under review in its operation was fair and reasonable in the circumstances. But it is necessary to make such findings of fact only for that purpose. It does not decide afresh all findings of fact of the primary decision-maker as if that decision had not been made. It does not, in that sense, simply stand in the shoes of the primary decision-maker.
Hence, under s 37, although the Tribunal is required to make its own decision in relation to the complaint, it is required to make only such findings of fact as are necessary for its decision. It must do so upon the evidence before it. In the light of such findings or conclusions as it has reached, the Tribunal must consider whether the decision it is reviewing, in its operation, was fair and reasonable in the circumstances: Military Superannuation and Benefits Board No 1 v Stanger (2002) 68 ALD 12 at 18-19 [21]. Section 37(6) requires that step. Ultimately the object of the Tribunal's review is to remove unfairness or unreasonableness in the decision under review …
We agree with Mansfield J's approach as stated in these passages.
51 We accept that the Tribunal must make its own assessment of the evidence and other information with a view to making its own findings of fact directed to the fundamental question for determination - whether the decision of the trustee was fair and reasonable. The Tribunal may, of course, accept the findings made by the trustee if it agrees with them, but the Tribunal's function is not discharged merely by forming a view that the trustee's factual findings were fair and reasonable. Rather, the Tribunal must ascertain the facts for itself upon the material before it and satisfy itself by reference to these facts whether the trustee's decision was fair and reasonable in the circumstances. Moore J expressed the same idea in Marks v CSS Board of Trustees [2005] FCA 797 at [23], saying:
[Section] 37(6) of the Complaints Act does not authorise … the Tribunal simply reviewing all factual issues and indicating that findings by the prior decision maker were fair and reasonable. That subsection is intended to operate on the ultimate decision made by the prior decision maker, namely the decision under review. What the Tribunal must do is form a view about necessary facts, determine what the facts are and then by reference to those ascertained facts determine whether the decision of the prior decision maker was fair and reasonable in the circumstances. The facts ascertained by the Tribunal constitute "the circumstances" by reference to which the Tribunal makes that evaluation.
See also Edwards v Postsuper Pty Ltd [2006] FCA 1380 at [30] (Moore J).
52 Having regard to the relevant provisions of the Complaints Act and the nature of the review that the Tribunal is to conduct under that Act, as outlined in the authorities discussed above, we conclude that the Tribunal conducted the review of the decision of the Board of Trustees in accordance with the Complaints Act and, in particular, s 37.
53 Plainly enough, the Tribunal correctly identified the fundamental question that it was to answer: see [21] above. As we have seen, the critical question for the Tribunal was whether or not it was satisfied that the decision of the trustees - being the decision under review - was, in its operation in relation to Mr Edington, fair and reasonable in the circumstances: see s 37(6). Nothing in the Complaints Act expressly required the Tribunal to consider whether or not the reasoning process adopted by a trustee in reaching the impugned decision was fair and reasonable; and no such obligation should be implied. In so far as the reasons of the primary judge conveyed a different view, we consider that his Honour erred. This is because, in the context of s 37(6), the Tribunal is required to make its own assessment of the evidence and other information before it, in order to determine whether or not it is satisfied that the decision under review was, in its operation in relation to the complainant, fair and reasonable in the circumstances. The Tribunal may make its own findings of fact for this purpose after a de novo hearing. After this new hearing, nothing may turn on the reasoning process of the previous decision-maker, because the Tribunal may or may not, for its own reasons having regard to the evidence before it, be satisfied that the decision under review was fair and reasonable in its operation in relation to the complainant in the circumstances as it has found them. Thus, even if the Tribunal's factual findings differed from those of the previous decision-maker, the Tribunal might nonetheless be satisfied that, in the circumstances, the decision under review was in fact fair and reasonable in the relevant way. Plainly enough, in this event, the process of reasoning adopted by the Tribunal in determining whether or not the decision under review was relevantly fair and reasonable would be likely to differ from the reasoning that led to the decision under review. The fact that it did would not necessarily bear on the Tribunal's satisfaction as to the reasonableness or fairness of the decision under review.
54 Thus, we do not consider that it was incumbent on the Tribunal to focus on the reasoning that supported the decision of the Board of Trustees. In deciding whether the decision of the Board of Trustees was relevantly fair and reasonable, the Tribunal was required, plainly enough, to consider the decision the Board of Trustees had made; and the Board's reasoning process, as outlined in its written statement, was necessarily part of the information before the Tribunal. The Tribunal's own reasons for decision make it clear that the Tribunal was well aware of the Board's reasoning process, including the fact that the Board of Trustees preferred the evidence of Dr Reddan to that of Dr Butler and Dr de Leacy because of the different histories given to them. However, the Tribunal undertook its own assessment of the evidence and information before it, as it was required to do; and, as a consequence, made its own findings with a view to determining whether the decision under review was relevantly fair and reasonable, as it was entitled to do. The Tribunal's findings differed in some respects from those of the Board and so did its reasoning. Since the Tribunal was undertaking a hearing de novo for the purpose of determining for itself whether or not the decision (as opposed to the reasoning) of the Board of Trustees was, in its operation in relation to the complainant, fair and reasonable, the Tribunal was not obliged to scrutinize the reasoning process of the Board; but, rather, was required to make its own decision on the material before it as to whether the decision made by the Board was fair and reasonable in its operation in relation to Mr Edington. In so doing, it might pursue a process of reasoning that it considered best took account of the facts as it found them, bearing in mind the trust deed, the insurance terms and the law as the Tribunal understood it: compare the Complaints Act, s 37(5). The Tribunal was not required to take the extra step of comparing the Board's reasoning process with its own.
55 The primary judge was of the opinion that the Tribunal failed properly to consider the discrepancy between the evidence of Drs Butler and Reddan, when it accepted the evidence of both. It may be recalled that the Tribunal found that the decision to refuse Mr Edington a TPD benefit on the grounds, amongst others, that Mr Edington's total and permanent disablement was related to his pre-existing schizophrenia was fair and reasonable, "given the conflicting psychiatric opinions". At this juncture, the Tribunal noted that it preferred the opinions of Drs Butler and Reddan.
56 We interpolate here that the statement that it preferred the opinions of Drs Butler and Reddan was originally challenged as part of Mr Edington's no-evidence ground - the other related part of the ground being that there was no evidence that, in the absence of an anxiety disorder, Mr Edington's incapacity for work arose from his schizophrenia. Effectively, both parts of the no-evidence ground focused on the suggested absence of evidence that Mr Edington's work incapacity was related to his pre-existing schizophrenia.
57 We do not consider, however, that there is any relevant deficiency in the Tribunal's approach in this regard. As already noted, it was common ground that at all times material to this appeal Mr Edington suffered from schizophrenia. In reports dated 3 May 2003 and 15 July 2008, Dr Reddan expressed the opinion that Mr Edington's ongoing incapacity for work was related to this pre-existing condition. Dr Reddan also considered that Mr Edington did not meet the full criteria for a diagnosis of a Specific Phobia with regard to dogs. Dr Butler did not attribute Mr Edington's incapacity for work to schizophrenia but (as stated in a report dated 13 January 2003) was of the opinion that Mr Edington had not suffered from PTSD and (as stated in a report dated 17 July 2003) that any phobia that had arisen as a consequence of the dog incident had dissipated.
58 The opposing view to that of Drs Reddan and Butler was that Mr Edington's incapacity for work was the consequence of PTSD arising out of the dog incident. This was the opinion of Dr de Leacy: see [19] above. Both Drs Reddan and Butler rejected this possibility since both rejected the existence of PTSD.
59 The Tribunal's conclusion that the medical condition in the nature of an anxiety disorder attributable to the dog incident was supported by Dr Butler's evidence. Its conclusion that Mr Edington's incapacity for work was related to his pre-existing schizophrenia was supported by Dr Reddan's evidence. The Board of Trustees had also accepted Dr Reddan's evidence in this latter regard. In substance, in concluding as it did, the Tribunal accepted different aspects of the evidence of the medical opinions given by these two medical practitioners. It was open to the Tribunal to approach the matter in this way and, on the basis of Dr Reddan's evidence, to find that Mr Edington's total and permanent disability was related to a pre-existing condition of schizophrenia. It was therefore open to the Tribunal to make the finding it did, and no error of law is disclosed in this regard.
60 It may be that, as counsel for Mr Edington submitted, the Tribunal mistook Dr Butler's evidence when it said (at paragraph 103 of its statement of reasons) that, in mid-2003, both Dr Reddan and Dr Butler attributed Mr Edington's incapacity for work to his pre-existing schizophrenia. As stated at paragraph [59] above, this would not support a finding of error of law. In any case, it is well accepted that there is no error of law "simply in making a wrong finding of fact": see Waterford v The Commonwealth (1987) 163 CLR 54 at 77 and Australian Broadcasting Tribunal v Bond 170 CLR at 356.
61 As noted earlier, the primary judge found that the Tribunal did not carry out its review properly for reasons that included the Tribunal's failure to consider the effect on the cogency of the various medical opinions of the different medical histories said to be given by Mr Edington to the relevant medical practitioners. We do not agree that the Tribunal failed in this regard, but if we are wrong about that, then the failure was one that would only affect the weight to be given to aspects of the medical evidence. Generally speaking, issues of the weight to be given to evidence do not give rise to a question of law: see Australian Broadcasting Tribunal v Bond 170 CLR at 355-357. In the present case, as already noted, the findings made by the Tribunal were open to it.
62 For these reasons too, no error of law is shown in the Tribunal's failure to give any detailed analysis of discrepancies between the Tribunal's evidential approach and that of the Board of Trustees, or between the opinions of Drs Butler and Reddan. To the extent that the primary judge took a contrary view, we respectfully disagree.
63 In finding that the Tribunal had not properly fulfilled its reviewing function, the primary judge also held that the Tribunal failed adequately to address Mr Edington's submission to it that the Board of Trustees had not considered Dr Butler's report of 15 July 2004. We consider that his Honour's criticism was misplaced in this respect. The Tribunal expressly referred to and summarised Dr Butler's 15 July 2004 report and made a finding that was open to it based on that report - namely that any anxiety disorder suffered by Mr Edington in connection with the dog incident was temporary. The Tribunal was not constrained in any relevant respect by the fact that the Board of Trustees had not mentioned this particular report. Rather, it was for the Tribunal to consider for itself the evidence and other information before it, although (as we have already said) solely for the purpose of determining whether or not the decision of the Board of Trustees was fair and reasonable in the circumstances. Further, the decision and reasons of the Tribunal do not justify the conclusion that the Tribunal erred by conducting a review of the whole of the evidence in order to ascertain the rights of the parties generally.
64 On the hearing of the appeal, counsel for Mr Edington submitted that the Tribunal had also adopted a wrong approach by focussing on the current and ongoing causes of Mr Edington's disablement, instead of focussing on the correct question - the cause of the disablement at the time of disablement. This submission had two aspects. The first is reflected in the reasons for judgment of the primary judge. We discuss the second at [68] below. In expanding on the proposition that the Tribunal ought to have given more consideration to the reasoning of the Board of Trustees, his Honour said (at [46]):
Furthermore, on this aspect, it will be noted that both the Trustees and the Tribunal concluded Mr Edington's schizophrenia condition was the only alternative cause of his total and permanent disablement for work. Neither seems to have turned their minds to the temporal aspect of this causation issue raised by Dr Butler in his report of 17 July 2003 … to the following effect: if Mr Edington could obtain work and perform his duties in its satisfactorily up until he sustained injuries in the dog incident what, apart from the incident, would explain his becoming totally and permanently disabled for that work so soon thereafter?
65 Counsel for Mr Edington not only supported his Honour's analysis but argued that the Tribunal's focus on the current and ongoing causes of Mr Edington's disablement led the Tribunal erroneously to prefer the evidence of Dr Reddan to other medical evidence, which indicated that other conditions, apart from schizophrenia, may have been responsible for Mr Edington's disablement. Further, so counsel for Mr Edington said, "[b]y focussing on a false process of elimination, the Tribunal has misunderstood its task". For the reasons stated at [67] below, we would reject these submissions.
66 Also on the hearing of the appeal, counsel for Mr Edington advanced two other submissions in support of its principal contention that the Tribunal adopted the wrong approach. Counsel argued "[b]y describing [its] relevant task as determining whether the 'condition' which led to the disablement was related to the pre-existing condition", the Tribunal manifested two errors: (1) the insurance policy required "a causal relationship between the disablement and the pre-existing condition, not between the condition 'rendering' the disablement and the pre-existing condition"; and (2) the Tribunal misunderstood its task because it failed to recognize that the Board of Trustees did not find that the two conditions were related. We would also reject these submissions: see [67] below.
67 As we observed earlier, the Tribunal correctly identified its statutory role at the outset of its deliberations and correctly stated that it was to determine whether the decision of the Board of Trustees to refuse the TPD benefit because of Mr Edington's pre-existing illness was fair and reasonable in relation to him in the circumstances. Whilst there may be some infelicitous phrasing in the Tribunal's statement of reasons, including the instance at [66] above, when read as a whole, we are satisfied that the Tribunal did not in fact mistake the issue it was to determine, either in its causal or temporal aspects. The Tribunal addressed this issue in its summary of its "deliberations on the medical reports" and, ultimately, in the penultimate paragraphs of its statement of reasons: see [23] above. We further accept that, as the appellant submitted, the Tribunal made a proper assessment of the medical evidence bearing in mind the insurance terms and the trust deed. We would not therefore attribute the posited errors to the Tribunal. In reaching this conclusion, we are guided by the well-accepted proposition that administrative decisions should be read as a whole and "without an eye keenly attuned to the perception of error": see Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 272, affirming the test in Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287. This proposition is particularly apposite in such a case as this, in which the Tribunal's determination as to the fairness and reasonable of the decision under review inevitably involves a strong evaluative component that it essentially a matter for the Tribunal: see Sadleir v Motor Trades Association of Australia Superannuation Fund Pty Ltd [2010] FCA 930 at [54] (Lander J); National Mutual Life Association of Australia Ltd v Campbell (2000) 99 FCR 562 at 571 [33] (Black CJ, Emmett and Hely JJ); and Mohandoss v AMP Superannuation Limited [2007] FCA 497 at [23] (Ryan J).
68 Also at the hearing of the appeal, counsel for Mr Edington argued that the Tribunal failed to focus its inquiry on the date of disablement as clause 4.4 of the terms of insurance required. Amongst other things, this argument involved the proper construction of the terms of insurance and identification of the date of disablement. As we noted on the hearing of the appeal, however, the primary judge did not rule that the Tribunal erred in failing to consider the situation as at the date of disablement in accordance with clause 4.4 of the insurance terms; and there was no notice of contention on Mr Edington's part seeking to support his Honour's judgment on this ground: see Federal Court Rules, Order 52, rule 22(3). When the absence of a notice of contention was brought to counsel's attention, counsel for Mr Edington properly conceded that this issue should not be decided by us. Moreover, we note that there was a lack of clarity in Mr Edington's argument as to the precise date of disablement. In oral argument, his counsel stated that this date was 26 May 2003 "at the latest", although in the notice of appeal before the primary judge this date was said to be 8 July 2002.