Conclusion
11 I deal with the first issue raised by the applicant. That is, whether the Tribunal erred by construing the expression "loss of earnings on his own account" as requiring a loss of net earnings, namely gross earnings less deduction of expenses. The meaning of the expression "earnings on his or her own account" in s 24(2A)(e) has to be ascertained having regard to the statutory context in which the expression appears. It is clear that both the reference to "earnings" in s 24(2A)(e) and "salary or wages" in the same paragraph concern the product of "remunerative work" in the preceding paragraph viz s 24(2A)(d). That is, one criterion that must be satisfied to secure a special rate of pension is that the veteran has been prevented from continuing in remunerative work because of the war-caused incapacity (flowing from war-caused injury or disease) and another criterion is that because the veteran has been prevented from working in this way, he or she is suffering a loss of salary, wages or earnings.
12 Accordingly, a logical starting point in determining the contents of the second criterion is ascertaining what is meant by "remunerative work". While the meaning of this phrase has not arisen directly in the context of subs (2A) of s 24, the meaning of the phrase has arisen in the context of subs (1)(c) of the same section. The phrase can plainly be treated in that latter subsection as serving the same statutory purpose as in the former and can be treated as having the same meaning. Whether work is "remunerative work" raises questions about whether it is substantial and successful: see Sheehy v Repatriation Commission (1996) 66 FCR 569 at 574.
13 That is not say, however, that what constitutes "remunerat(ion)" is to be viewed narrowly. In Repatriating Commission v Buckingham (Ryan J, 7 February 1996, Federal Court of Australia, unreported) Ryan J had to consider whether a person engaged in voluntary work for the church and provided with free accommodation might be viewed as having been engaged in "remunerative work". It was common ground in that matter, and apparently accepted by his Honour, that accommodation provided in return for services rendered could amount to remuneration for the purposes of s 23(1)(b) of the Act. Nonetheless, the work must be substantial and I apprehend that this was the underlying basis on which Wilcox J accepted that the Tribunal had not erred in declining to characterise the dog breeding in Hill v Repatriation Commission [2000] FCA 929 as "remunerative work". In that matter the veteran had been engaged in dog breeding in a minor way which the Tribunal had found was "merely a hobby that produced some very limited income for him". In that context, Wilcox J made the following observations (at 10 - 11),
I agree with Ms Henderson that neither Sackville J nor the Full Court (in Sheehy) intended to lay down an immutable "test" as to what might constitute "remunerative work" within the meaning of s 24(1)(c) of the Act. I also agree with her that, even if the Full Court did prescribe a test that must be applied to this case (namely, the formula "the 'remunerative work' must have been 'performed' or 'successfully undertaken' or 'effectively undertaken'"), the Tribunal's findings dispose of the notion that the dog breeding activity undertaken by Mr Hill passed that test, and was "remunerative work" within the meaning of s 24(1)(c). The Tribunal found the dog breeding plan "did not properly commence operation" and was "merely a hobby that produced some very limited income for him". On the evidence, it was clearly open to the Tribunal to make these findings. If the finding were affected by any error, it was that they stated the effect of the evidence in a manner unduly favourable to Mr Hill; although the dog breeding brought in some income, this was outweighed by the attendant costs. establish himself or herself in a particular activity, being a continuation Far from being remunerative, the activity was costly to Mr Hill.
There may be cases where an activity in which a veteran engaged failed to return a net profit to the veteran, but may nonetheless be regarded as "remunerative work" for the purposes of s24(1)(c). One example may be a case where the veteran attempted to of remunerative work previously undertaken by the veteran, but was denied success by his or her war-caused disability. If the decision maker was satisfied that the attempt would have been successful, in the sense of providing "earnings on his or her own account" - that is, net earnings after deduction of expenses - but for the war-caused disability, I see no difficulty about concluding that the veteran has been prevented, by the war-caused disability, "from continuing to undertake remunerative work that the veteran was undertaking" and, by reason thereof, has suffered a loss of earnings on his or her own account.
However, that is not the present case. ...." ( Emphasis added)
The observations of Wilcox J might be viewed as suggesting that work is "remunerative" only when a profit is derived from work undertaken as part of a business. However, I doubt that his Honour intended to say that work in a business could never be "remunerative" if the business made no profit. Rather, it was the characterisation of the work as a "hobby" by the Tribunal in its findings that led Wilcox J to conclude there had been no error of law on the Tribunal's part in deciding that the veteran had not been engaged in "remunerative work" (in so far as the dog breeding was concerned). It is unlikely the highlighted observations of Wilcox J in the second paragraph were intended to be an exhaustive analysis of the meaning of the expression "earnings on his or her own account".
14 However, even if "remunerative work" has the meaning just discussed, it does not follow that the expression "earnings" in s 24(2A)(e) is intended to comprehend all that which may be "remunerat(ion)" so as to give work the character of being "remunerative work". Expressions such as "salary", "wages" and "earnings" often have a narrower meaning than "remuneration": see e.g. Shead v Summit Western Pty Ltd (1998) 81 IR 347 at 348-354 but compare Paterson v Stanmorr Pty Ltd [2000] VSCA 220, though their meaning will ultimately depend on the statutory context in which they appear. For my part, the most helpful recent analysis of a provision analogous to the present is found in Accident Compensation Commission v Alger [1993] 1 VR 379.
15 In Alger, a worker had been injured in February 1987 for which compensation was paid under the Accident Compensation Act 1985 (Vic). In May 1989 the Accident Compensation Commission ceased to make payments on the basis that the worker had "actually returned to work" though it was not in the issue in the proceedings in the Victorian Supreme Court that the termination of payments had been improper. In June 1989 the worker and his wife purchased an aquarium business and commenced to operate it in partnership. The partnership business ran at a loss. The worker applied for the resumption of weekly payments and also for a redemption of his entitlement under the legislation. In determining the worker's entitlements on both these matters it was necessary to determine whether he had "current weekly earnings" and in what amount having regard to the aquarium business he was then involved in. The expression "current weekly earnings" was relevantly defined as "the worker's actual earnings during the week".
16 The matter was first determined by the Accident Compensation Tribunal which concluded that the worker had no "current weekly earnings" having regard to the fact that the business was running at a net loss. It appears to have followed that the worker was entitled to be paid (and a redemption calculated by reference to) the difference between what had been his average weekly earnings before the injury and his "current weekly earnings" which were zero. The Accident Compensation Commission appealed against the Tribunal's determination. In the Appeal Division of the Supreme Court of Victoria, the leading judgment was given by Ashley J (Marks and Smith JJ agreeing). The appellant contended that one of two methods might be adopted in ascertaining the "current weekly earnings". The first and preferable method was to endeavour to ascertain what was the value of the work of the worker to the partnership. This method was supported by the approach of the High Court in Cage Developments Pty Ltd v Schubert (1983) 151 CLR 584. The second was by referring to the net profit of the business.
17 Ashley J reviewed the authorities which might support each approach and concluded that the use of the word "actual" could properly direct attention, in the statutory context in which it appeared, to the net profits of a business in the situation then under consideration. His Honour concluded that the Tribunal had not erred in looking at the net profits and approaching the matter on the footing that the value of work method had no part to play in determining "actual earnings". Importantly, his Honour quoted (at 388) observations of the High Court in Cage Developments:
"… there is no single way in which the actual or potential earnings of such a former worker must be determined. The circumstances of the particular case will indicate what way or ways are open and what evidence is relevant for that purpose (of determining actual earnings) and it is undesirable to confine the commission within the strict limits of artificial rules laid down in advance by an appellate court. Thus, there may well be cases in which the actual earnings of a business either represent the actual or potential earnings of a former worker during a period partial incapacity. Where, for example, a business consists essentially of the provision of personal services by the former worker (e.g. a business of a sole plumber or casual gardener) and no significant investment of capital is involved, the actual net earnings of the business might properly be seen as representing the actual 'reward for the [the] labour' of the former worker… during a period of partial incapacity. In such a case, if the former worker is carrying on business solely on his own account, the net earnings of the business might properly be seen as representing the 'amount he is earning' in a business; if he is carrying on business in partnership or as an employee of a family company, the net earnings might properly be seen as representing the 'amount he ... is able to earn' either in employment or in a business."
18 Ashley J then made the following observation:
"That passage emphasised the need for flexibility of application of the test appropriate to the old legislation. If the value of work method remains potentially relevant to a business situation under s 5B(1), there is no reason to doubt that the flexibility attaching to application of the old test remains appropriate in the present context. That being so, the Tribunal was entitled to, and did on the facts, choose what it considered to be the most appropriate method of determining "actual earnings".
19 It is to be recalled that in the present matter the Tribunal accepted that the conduct of the farm was a business. However in considering whether the applicant had suffered "a loss of earnings on [his] own account" it concluded that "the correct appreciation of earnings is net earnings, namely gross earnings less deduction of expenses". As noted earlier, the Tribunal gave its reason for following this approach as being: "(on) this issue the Tribunal follows Wilcox J in Hill v Repatriation Commission (supra)". On one view, the Tribunal was indicating that, as a matter of law, it was bound to assess loss of earnings by reference only to net earnings of the partnership. If that was the approach adopted, it would reveal legal error because s 24(2A)(e) does not require that earnings be assessed on that basis only.
20 However these remarks of the Tribunal followed an analysis of the business in which the Tribunal pointed to the capital injections made by the applicant and his wife, uncertainty as to the benefits enjoyed by the applicant while operating the partnership business and the applicant's expectation of receiving payment from the business whether by income reinvestment and capital enhancement or by way of drawings, profit, tax benefits or living expenses. The better view is, in my opinion, that the Tribunal adopted the approach it did having regard to the limited material before it concerning the business. The approach it took was an approach available having regard to the generality of the language used in s 24(2A)(e). The Tribunal's adoption of this approach does not reveal legal error.
21 The second issue raised by the applicant is whether the Tribunal erred by failing to consider the hypothetical position which would have obtained in relation to the applicant's earnings if he had not been incapacitated due to his war-caused disabilities. The proper application of s 24(1)(c) (and by parity of reasoning s 24(2A)(e)) can require, in appropriate circumstances, the Tribunal to consider whether a business which, as a matter of fact, was unprofitable might have been profitable but for the incapacitating effect of the war-caused injury or disease: see Thomas v Repatriation Commission (1994) 50 FCR 112 at 124-5. In the present matter it was submitted that the Tribunal accepted that in 1988 part of the property was sold because of a deterioration in the applicant's health and stocks were reduced because of the applicant's physical difficulties with a consequential drop in revenue. What, it was submitted by the applicant, the Tribunal did not do was make an assessment of what would have happened (in terms of earnings by the applicant) had the farming business not been pared back in this way.
22 The difficulty I have with this submission is, as counsel for the respondent points out, there is nothing to suggest that the applicant raised as a possibility that the farm would have been profitable but for the changes commencing in 1988 flowing from his deteriorating health. In Thomas the veteran had raised the question of the business being a profitable one but for the incapacitating effects of his war-caused disabilities. In the absence of a contention to that effect, I do not discern any error on the Tribunal's part in not addressing the question.
23 I dismiss the application and order the applicant pay the respondent's costs.
I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore.