Defence Force Retirement and Death Benefits Authority v O'Fee

In addition to the documents before the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 and exhibits tendered during the hearing, the Tribunal heard evidence from the following persons: from the Applicant; from George Marshall Nunn M.B., B.S., F.A.C.S., F.R.C.S. London, a retired private practitioner; and from Leon Gordon Smith, employment counsellor with the Mirrabooka office of the Commonwealth Employment Service.

"53. (1) The Authority may, from time to time, if it is satisfied that the percentage of incapacity in relation to civil employment of a pensioner classified under section 51 of this Act is such that the classification of the pensioner should be altered, reclassify him in the appropriate classification set out in sub-section (2) of section 51 according to the percentage of his incapacity in relation to civil employment.

(1A) In determining, for the purposes of sub-section (1), the percentage of incapacity in relation to civil employment of a pensioner, the Authority shall have regard to the following matters only:

(a) the vocational, trade and professional skills, qualifications and experience of the pensioner;

(b) the kinds of civil employment which a person with skills, qualifications and experience referred to in paragraph (a) might reasonably undertake;

(c) the degree to which any physical or mental impairment of the pensioner, being a prescribed physical or mental impairment, has diminished the capacity of the pensioner to undertake the kinds of civil employment referred to in paragraph (b);

(d) such other matters (if any) as are prescribed for the purposes of this sub-section.

(1B) In sub-section (1A), "prescribed physical or mental impairment", in relation to a pensioner, means -

(a) a physical or mental impairment of the pensioner that was the cause, or one of the causes, of the invalidity or physical or mental incapacity by reason of which the pensioner was retired, whether or not that impairment has changed for better or worse, since that retirement; or

(b) any other physical or mental impairment of the pensioner causally connected with a physical or mental impairment referred to in paragraph (a)."

The Tribunal considers that it is required to approach the relevant provision in accordance with the following principles:

1. The only matters which it may take into account in determining the percentage of incapacity are those referred to in the provision.
2. Accordingly, the Tribunal cannot take into account:
   • - the ageing process;
   • - a depressed labour market;
   • - a state of unemployment;
   • - the shortage of employment for those who might engage in a particular occupation;
   • - circumstances forseeable only in the long term unless made appropriate;
   • - prevention of continuance in non-civil employment.
3. Regard must be had to the current capacity of the member at the time of the classification or reclassification not at the time of the injury which incapacitated him. This requires the Tribunal to review the decision of the Authority as at the date when it was made and not at the date when it was reconsidered but in so doing it should take into account all relevant evidence arising after that date.
4. In making the determination, the concept of incapacity for work as enunciated in Arnotts Snack Products Pty. Limited v. Yacob [1985] HCA 2; (1985) 57 ALR 229 in relation to partial incapacity as that of a reduced physical capacity, by reason of disability, for actually doing work in the labour market in which the employee was working or might reasonably be expected to work rather than whether or not the injured employee suffered actual economic loss, should be kept in mind.
   1. The words "vocational, trade and professional skills, qualifications and experience" in paragraph 53(1A)(a) ought not to be read narrowly.
   2. In paragraph 53(1A)(b) the phrase "employment which a person ... might reasonably undertake" refers to a question whether it is reasonable to expect a person to undertake a specified employment as distinct from physical capacity upon which emphasis is given by paragraph 53(1A)(c).
   3. In assessing the degree referred to in paragraph 53(1A) (c) regard must be had to the width, quality and nature of the range in employment opportunities and a: value judgment, rather than a mathematical calculation, made.

These principles appear to the Tribunal to flow from what was said in Re Thomson and Defence Force Retirement and Death Benefits Authority (1987) 6 AAR 424 by Davies J. (President); in Freeman v. Defence Force Retirement and Death Benefits Authority (No. VG 269 of 1984, 17 July 1985) by Sheppard J; in Defence Force Retirement and Death Benefits Authority v. O'Fee (No. NSW G71 of 1984, 6 June 1 Force Retirement and Death Benefits Authority (1979) 2 ALD 574

Vocational, trade and professional skills, qualifications and experience of Applicant

The Applicant was born on 5 July 1937 and was educated to the 7th Grade. Prior to joining the Royal Australian Air Force on 6 June 1958 he held the occupations of a trainee lithographer and garage attendant. His period of service continued until 11 October 1968 when he was discharged as medically unfit. During his service period he was engaged as a mechanical transport driver.

Following discharge the Applicant worked from 1968 until 1975 as a service manager or clerk in the motor trade. From 14 April 1975 to 28 August 1981 he worked as a manager of a music record bar. From 8 February 1982 to March 1984 he was employed as a clerk with Repco. From July 1984 to December 1984 he was employed by Shacks Holden as a warranty/service clerk. Since July 1985 he has been a part-time driver and sales representative responsible for delivery of pies and pasties to schools and delicatessens.

Kinds of civil employment which might reasonably be undertaken

In the opinion of the Tribunal a person with the skills and qualifications and experience of the Applicant might reasonably undertake civil employment as a driver, clerical/office assistant or retail shop manager.

In 1964 the Applicant fell some 20 feet from a pallet landing on his feet. Conversion hysteria was initially diagnosed as the cause of back pain and stiffness as well as headaches from which he suffered. However, in April 1985 a C.A.T. scan was taken of the Applicant's back and this disclosed that he had an L5-S1 disc prolapse which migrated up behind the body of L5 on the left side. The Respondent correctly accepted that there is now no evidence to sustain any psychological condition.

The Applicant was examined by Dr. Nunn on 16 May 1984. At that time disc injury was detected but not disc prolapse. Dr. Nunn's evidence was that disc prolapse is a progression from disc injury. In his opinion the prolapsed disc is almost certainly now adherent in its present site so that the Applicant's condition is unlikely to deteriorate markedly.

Against this evidence the Tribunal is asked to conclude that the disc prolapse occurred prior to the relevant date. Mr. Christie on behalf of the Applicant submitted that on the balance of probabilities such was the case. He relied upon evidence given by the Applicant which he said was to the effect that the Applicant was dismissed in December 1984 from his employment with Shacks because he moved too slowly. The Applicant's evidence was that he spent 50% of his time sitting and 50% standing in that employment. He had noticed that he had been slower in moving. A week or so prior to termination of his employment this had been pointed out to him on behalf of his employer and he had replied to the effect that he had a back problem. Approximately a week later he was dismissed without reason. As submitted by the Respondent the Tribunal accepts that this evidence does not establish that the termination of the Applicant's employment with Shacks was due to his condition or to a worsened condition.

In the report of Dr. McCallum of 6 May 1985 advising the results of the C.A.T. scan he said that because of the migration of the disc behind the body of L5 there was an inability to find the condition on previous investigations. This suggests to the Tribunal that the disc prolapse may have been present prior to or at the relevant date but have been incapable of detection. On the balance of probabilities it finds that it was so present.

Accordingly, the Tribunal concludes that "low back disability at the L5-S1 level" is the correct description of the Applicant's retirement impairment and that "disc prolapse" was a condition causally connected with the retirement impairment. These conditions together constitute the "prescribed physical or mental impairment" of the Applicant.

Degree of diminution of capacity of Applicant to undertake relevant kinds of civil employment

Not only must the Tribunal look at the facts as they were at 14 December 1984 but in addition, it considers it is not appropriate in this proceeding to look to the Applicant's long term prospects inasmuch as the Tribunal was advised that a further classification of the Applicant is being carried out by the Authority as at 11 December 1987.

As at the relevant date the Applicant was employed at Shacks and as has been said, spent 50% of his time sitting and 50% standing. His employment was full time. The Applicant could not remember details of any periods which he may have taken as sick leave.

Also relevant was evidence that the Applicant had been offered alternative employment at Repco as a counter clerk. This position would have entailed standing for 8 hours a day so the Applicant declined it because of the discomfort it would have occasioned him.

The Applicant considered there was not much change in his condition between December 1984 and the date of the hearing although he acknowledged he now experienced increased pain and needed to lie down for greater periods. He said he had taken what he described as pain killers daily since 1967 but in 1984 he would only take such tablets at night. He presently experiences lower back pain both sides of his spine. He awakes with very little flexibility in his spine. In December 1984 he said he would acquire spinal flexibility more quickly after wakening than he now could. The Applicant has not obtained any advice on exercises or measures which he could take to improve his spinal flexibility consistently with his physical impairment.

We turn to consider the degree of diminution of the Applicant's capacity in relation to the kinds of employment determined pursuant to paragraph 53(1A)(b):

The Applicant presently drives from 7 a.m. to 11 a.m. He is finding this increasingly taxing and apparently lies down for 2 or 3 hours after returning from this employment.

The Tribunal does not consider the Applicant's capacity to drive at 14 December 1984 can be correctly ascertained from his evidence as to his capacity to drive in 1988. It does not consider that on the balance of probabilities the difficulties which he now experiences were all experienced in relation to driving at the relevant date. Given his full-time employment at Shacks and the nature of it at that time it is not considered that he was precluded from driving at the relevant date.

In proximity to the relevant date the Applicant's duties at Shacks appear to have been partly of a clerical/office assistant nature. Duties at Repco until March 1984 were clerical.

His evidence was that he could sit for 45 minutes to 1 hour before he became uncomfortable and had to stand. The most that he could stand before discomfort set in was 20 minutes on average. At Repco he took some sick leave of a short duration due to back problems.

It appears that the degree of back comfort which the Applicant experiences in a sitting position depends on the type of chair or stool on which he has sat. His evidence was that when he was employed in the record bar and sat on a stool which had no back, he had worse back pain than at Repco where he had a seat with a back,

On the Applicant's evidence he succeeded as a retail shop manager for the music bar because he was able to be alternatively seated and standing while he carried out his duties. As has been said his tolerance for standing was limited to a period of approximately 20 minutes. The evidence of Mr. Smith was that a retail shop manager was usually on his feet.

This is a case where the quality and nature of the employment opportunity is at issue because it is apparent that in a position such as that offered in a music bar the Applicant was able to carry out his duties.

Although the Tribunal must make its own assessment of the degree of diminution of capacity, it notes that Dr. Nunn and Professor Burvill, in a report dated 10 February 1986, after clarification of the physical impairment as the L5-S1 disc injury and its sequel the disc prolapse, assessed diminution at 15%. This was the same percentage as Dr. Nunn had assessed on 16 May 1984 for diminution of capacity to undertake relevant kinds of civil employment (the Tribunal not being satisfied that Dr. Nunn here took into account another inappropriate test as argued on behalf of the Applicant). In a letter dated 8 July 1986 Dr. Nunn further advised a 15% assessment diminution.

Dr. Nunn's evidence was that in 1984 he had recorded that the Applicant only had pain on sitting and had pins and needles in his legs after an hour. He said it was his usual practice to ask patients if they had experienced pain on sitting, standing, walking, bending lifting or coughing. He inferred from an absence of note on these other matters that the Applicant had told him no pain was experienced on any of these. However, his written report of 17 May 1984 recorded "bending causes pain", a matter not in his notes of interview. On behalf of the Applicant it was argued therefore that the absence of any note of the Applicant suffering pain in a standing position after a period of 20 minutes or so does not entitle the Tribunal to conclude that the Applicant had not experienced that pain or did not tell Dr. Nunn of it. In support of this, reliance was placed on the Applicant's evidence that he had had difficulty with standing since his Air Force days when he first experienced pain on parade.

Dr. Nunn said that in 1984 he assessed the Applicant as having a permanent mild disability. He said the Applicant would be subject to some restrictions, namely, that he could not lift weights over 10 kilograms or engage in repetitive lifting or work in a bent position. His evidence was that had the Applicant's position been more than mild, treatment would have been recommended.

On behalf of the Applicant we were referred to prior Tribunal decisions in Re Okell and Defence Force Retirement and Death Benefits Authority (1977) 1 ALD 79, where the impairment resulted from a duodenal ulcer, lumbo-sacral disc lesion and spondylitis, hearing loss and right popliteal cyst; Re George and Defence Force Retirement and Death Benefits Authority (1978) 1 ALN 630, where the impairment was constituted by an injury to a serviceman's back for which he had an operation; and Re Jones and Defence Force Retirement and Death Benefits Authority (1982) 4 ALN N148, where the impairment resulted from amputation of a right leg and severe injury to the left leg. We see no parallels between the assessments made on the facts of those proceedings and the facts of this proceeding.

Having considered all these matters, it is the opinion of the Tribunal that the degree to which the Applicant's prescribed physical impairment has diminished his capacity to undertake the relevant kinds of civil employment as at the relevant date, is 20%. It accordingly follows that in the opinion of the Tribunal the Applicant is correctly classified as Class C at that date.

For the reasons given the Tribunal will vary the decision under review so that it reads that the Applicant's incapacity in relation to civil employment is 20% and his classification under section 53 of the Defence Forces Retirement Benefits Act 1948 is Class C.