Ford v SAS Trustee Corporation and Anor

Ford v SAS Trustee Corporation and Anor - [2000] NSWIRComm 92 - NSWIRComm 2000 case summary — Zoe

[49]

(18) The hearing then resumed on 13 March 2000. The first respondent appeared as a courtesy only and continued its submitting appearance; no submissions were made for it. On hearing final submissions from the applicant and the second respondent, the decision was reserved. 7 I have gone to some little length to refer to the course of the proceedings and, in particular, the circumstances concerning the apparent settlement of the claims because I think the settlement of a matter is of considerable importance and should, although the Court may not be bound thereby in making declarations of right, be given great respect. In the ordinary course, a consent position would likely be given effect by the making of orders in the terms sought: see s174(b) of the Industrial Relations Act and the overall discretion contained therein to do so. Here, however, it will be clear there was at best a conditional agreement which required the Court, in any event, to decide the substantive issue, namely, the true nature of the applicant's absence from police duties from 5 August 1989 to 21 September 1995 either as leave without pay or as special leave without pay which was sick leave. It was that issue which, rightly or wrongly in light of the consent orders proposed, continued in dispute between the applicant and the second respondent. It represented a real controversy between them as involving the applicant's right to an annual superannuation allowance rather than a lump sum payment under the relevant superannuation legislation. Whilst one may sympathise with the applicant who thought he had achieved his goal of an annual superannuation allowance by consent, I am of the view that the controversy must be subject to the Court's jurisdiction and, if it be so, where it is appropriate as a matter of discretion to make the declarations sought. 8 Finally on this aspect of the alleged settlement, and in light of the importance I place on parties being able to amicably resolve their differences by reaching a mutually satisfactory accommodation, I convened a hearing in chambers on 24 May 2000 to provide the parties with a final opportunity to reach a compromise. Despite what I think was a genuine endeavour, regrettably they were unable to do so. Therefore, I must proceed to determine the claims. In doing so, and although aware of the terms of the alleged settlement, I do not regard myself in any way as being bound or influenced thereby - the issues are to be determined in accordance with the evidence and submissions before the Court.

[121]

Determination by Marks J of applicant's medical condition 21 The application made in late-1998 by the applicant for medical discharge required a certificate of incapacity from the then State Authorities Superannuation Board (now the first respondent) pursuant to s 8(1) of the Police Regulation (Superannuation) Act 1906 in terms that the applicant, having regard to medical advice on the condition and fitness for his employment, was "incapable, from infirmity of body or mind, of discharging the duties of (his) office". On 26 April 1990, the Police Superannuation Advisory Committee as the delegate of the first respondent declined to issue such a certificate and on 21 August 1992 the first respondent's Disputes Committee confirmed the refusal to so certify. 22 The applicant thereupon appealed to the then Industrial Court against the refusal and the matter was heard by Marks J. On 14 October 1994, his Honour in the matter of Ford v State Authorities Superannuation Board (unreported, CT93/1024) determined the appeal and issued the certificate on finding, as his Honour said, "that the appellant is incapable from infirmity of mind of discharging the duties of his office". A perusal of his Honour's judgment disclosed that in reviewing the challenged decision of the first respondent consideration was given to the circumstances of the whole of the applicant's employment as a police officer and, in particular, the difficulties experienced by him in performing his duties from 1988 until he commenced leave without pay in August 1989. Marks J referred to evidence from various medical practitioners, including the Police Medical Officer, who had examined the applicant from 1988 to 1994. Marks J also heard evidence from the applicant himself. In the result, his Honour concluded (at pp 39-40): I should add that I do not regard the appellant's disinclination to again work for the Police Force as a factor which of itself will disentitle him from succeeding in this claim. It is part and parcel of his overall condition and is a significant factor in the persistence of his feelings of anxiety and depression. His resistance to working in the Police Force stems from his experience in the Police Force. No suggestion has been made by the respondent that the appellant has been consciously feigning his symptoms or that he has been malingering. The appellant has been quite candid about his attitude to working again in the Police Force and why he resists any such move.

[131]

(d) all leave entitlements had to be exhausted before further sick leave would be considered. 29 Mr Willis pointed out that there was evidence showing the applicant had during his leave period engaged in secondary employment in a video hire shop in which he had a financial interest with other family members and this factor was against him being sick and unable to perform his ordinary duties; the fact of non-approved secondary employment precluded the grant of either leave without pay or sick leave without pay. As to the decision of Marks J, Mr Willis maintained that his Honour's finding that the applicant was incapable from infirmity of mind of discharging the duties of his office did not have retrospective effect to the date of the applicant's commencement of leave without pay on 5 August 1989 and only applied from the date of his Honour's decision, that is, 14 October 1994. 30 To the contrary, Ms Nomchong submitted that the proper characterisation of the leave taken by the applicant was that of "sick leave", being absence from work by the applicant because he was incapable of performing his job due to illness; in that respect, counsel relied upon the finding of Marks J that the applicant was incapable of discharging the duties of his office due to infirmity of mind. Reference was made also to the evidence in these proceedings as to the medical condition of the applicant, including the various reports from the medical practitioners who examined him over the period from 1988 to 1994. Ms Nomchong's submissions, in summary form, made the following points - (i) The nature of sick leave does not necessarily impose a requirement that the person suffering from the ailment was incapable of performing any functions at all. The very nature of sick leave in an employment context is that the infirmity prevents the worker from discharging the particular duties for which he/she was employed. (ii) From the evidence it is plain that during the period which the applicant was on leave without pay he was unable to perform duties because of illness and, therefore, the leave ought properly be classified as special leave without pay being sick leave. (iii) In late-1988, the applicant was counselled by Inspector Simpson and then referred to the Police Medical Officer for assessment. He subsequently consulted a psychologist and a liver specialist and was then placed on restricted duties because of his psychiatric problems. (iv) When the applicant applied for leave without pay he did so on the advice of Inspector Simpson who advised him also that an appointment had been made for him to consult the Police Medical Officer. (v) The application for leave without pay was made solely on medical grounds, specifically that the applicant was unable to perform even the restricted duties then allocated to him. (vi) Accordingly, the essential elements of sick leave were present at the time the applicant applied for and took the leave without pay on 5 August 1989. Those conditions persisted until at least the decision of Marks J on 14 October 1994 so that the proper characterisation of the leave taken by the applicant should be that of sick leave. 31 Given the nature of the applicant's condition, Ms Nomchong submitted that the decision of the second respondent on 23 December 1996 not to classify the period of leave without pay between 5 August 1989 and 21 September 1995 as special leave without pay which was sick leave was manifestly unjust and unreasonable in the circumstances. The fact of the matter, so counsel submitted, was that the applicant applied for leave on the grounds of ill health and the second respondent ought to have treated it as an application for sick leave so as to enable it to be treated as special leave without pay and not merely leave without pay. In a real sense, counsel submitted, the distinction made by the second respondent seemed to be one of form rather than of substance. Further, counsel submitted it was incumbent upon the employer to provide the applicant with all relevant advice as to his employment entitlements and that was particularly so where the applicant was suffering from a psychological injury at the time he made the application for leave; indeed, he was encouraged to do so by Inspector Simpson. No advice was given to the applicant at that time or at any other time while he was on leave that he should apply for special leave without pay being sick leave. In the result, Ms Nomchong submitted that it was unreasonable and unfair in the circumstances for the second respondent to now attempt to rely on the absence of any "formal" application for special leave without pay being sick leave as distinct from an application for leave without pay. The true nature of the leave, as counsel said, was determined by examining all the facts and making a determination on those facts. 32 On any view of the evidence, I am satisfied that the leave sought by the applicant on 18 July 1989 and which he commenced on 5 August 1989 was due to his medical condition which, properly characterised, was such as to make him incapable of discharging his duties as a police officer. I reject the submission of Mr Willis that "there is no evidence that at the time of either application [for leave without pay], the Applicant was incapable of performing his duties". In my view, there was an abundance of evidence in these proceedings, both from the applicant himself and from medical practitioners, that he was ill and unable to carry out his work. That evidence was entirely consistent with that before Marks J and in respect of which his Honour found the applicant to be suffering at all relevant times from an infirmity of mind making him incapable of discharging the duties of a police officer. It is not to the point, as Mr Willis sought to argue, that "the Applicant applied for leave without pay, regarded himself as being on that type of leave and was treated by the Second [Respondent] as absent from duty on that leave" or that "what the Applicant now seeks is a change in the status of the leave well after the leave period concluded and well after his employment with the Second [Respondent] ceased". What matters, it seems to me, and as Ms Nomchong submitted, is the proper characterisation of the leave. 33 I agree too with Ms Nomchong's submission that the approach taken by the second respondent was more one of form rather than of substance. In any event, it is somewhat surprising that Inspector Simpson, on the applicant's evidence and not challenged by contrary evidence from Inspector Simpson, did not advise the applicant of his leave entitlements but asked him to apply for leave without pay. On Mr Gilchrist's evidence, as at 5 August 1989 the applicant had a credit of 4 days' sick leave, 3 days' annual leave, 7 days' accrued leave and one day's additional leave plus 148.2 days available as extended leave; as Mr Gilchrist said, the applicant "could also have made an application for Sick Leave without pay or a grant of further sick leave". None of that information was given to the applicant. Nevertheless, the comment by Inspector Simpson in supporting the application for leave without pay as from 5 August 1989 was that the applicant "is of little use to me at the present due to his medical condition", "there is also a staff morale problem caused by his attitude" and that "it would be of great assistance if this leave was granted as soon as possible so that he has an opportunity of improving his health condition and I have an opportunity to improve morale within the other staff at Bass Hill".

[132]

Change in status of leave 34 In the circumstances, I have no doubt that the applicant was reasonably entitled, in fact he had a legitimate expectation, to be advised by the second respondent of his leave entitlements and the nature of the leave available to him. That he was not so advised and encouraged to apply for leave without pay rather than sick leave, either with or without pay, should not now be held against him. To do so would be plainly unjust. It would also, in my view, be contrary to the true nature of the leave taken by the applicant and the reasons therefor. 35 The answer by Mr Willis that the applicant should not be permitted to change the status of the leave well after the event cannot, in the circumstances as they developed, be held to defeat his claim. The applicant sought from the first respondent a certificate of incapacity under the Police Regulation (Superannuation) Act in order to qualify for a superannuation benefit prior to making the first application for leave without pay on 18 July 1989; that claim for a certificate was refused on 26 April 1990 but the refusal was not confirmed until 21 August 1992. Then, the applicant appealed against the refusal, in a timely way, on 3 February 1993 and on 14 October 1994 Marks J upheld his appeal and issued a certificate of incapacity. In the result, the applicant was discharged from the Police Service, but not until 21 September 1995. No superannuation benefit was allowed, either a lump sum gratuity or an annual superannuation allowance, and that was so despite the apparent commonly understood basis upon which Marks J was proceeding, namely, consideration of a certificate of incapacity under s 8 of the Police Regulation (Superannuation) Act as a precondition to the receipt of an annual superannuation allowance under s 7 thereof. 36 The applicant's solicitors made representations on his behalf to the first respondent and it was not until it advised the applicant's solicitor by letter dated 9 January 1996 that reclassification by the second respondent of the period of leave without pay as special sick leave without pay would result in total service in excess of 20 years so as to give rise to an annual superannuation allowance under s 7. The applicant's solicitor thereupon made application to the second respondent to that effect by letter dated 24 January 1996 but it was not until 23 December 1996, 11 months later, that the second respondent advised he did not approve special sick leave being granted to the applicant. Although the first respondent in its letter of 9 January 1996 advised that the s 14 lump sum gratuity would be payable within 28 days with no further communication, unless of course in the meantime the category of leave was changed, no such benefit has since been payable and the position is that the applicant has received no superannuation benefit at all since his retirement on 21 September 1995. 37 These proceedings, therefore, seek appropriate declarations which, depending upon the findings made, should at least finalise this long outstanding claim. In the history as I have detailed it, it seems to me that the applicant has been subject to a decision-making process as to his superannuation entitlements involving two parties, here the first and second respondents, over an inordinately lengthy and unexplained period of time, and where the relief sought has been stoutly resisted, but as to which the applicant, in my view, should not have to suffer on discretionary grounds the refusal of relief otherwise due to him. 38 I am moved to express consternation at the treatment afforded the applicant by the second respondent in terms of the employment relationship between them since this matter first surfaced about 11 years ago in July 1989. It was then marked by a failure by the second respondent to properly inform the applicant of his then entitlements to leave, including leave already accrued by him - it is correct to say that if the applicant had been so advised of the leave entitlements available to him, as set out in Mr Gilchrist's affidavit, and applied accordingly, then he would have achieved the minimum of 20 years' service required for an annual superannuation allowance. That failure is compounded having in mind the comments by Inspector Simpson in recommending the grant of leave without pay based on the medical condition of the applicant as manifested by his behaviour in the workplace and its effects on other officers. 39 Even given the view of the second respondent, a view he was entitled to hold, that the applicant was not unable to perform his duties from August 1989 due to illness, the decision of Marks J on 14 October 1994 finding an infirmity of mind at all relevant times, sufficient to justify the issuing of a certificate of incapacity that the applicant was incapable of discharging the duties of his office in the Police Service, should, I would have thought, provided a proper basis for the second respondent to have reviewed his earlier position as to the true nature of the leave taken by the applicant from 5 August 1989. That a further period of in excess of 11 months after the decision of Marks J elapsed before the second respondent actually discharged the applicant on medical grounds on 21 September 1995 only adds to the concern I have expressed. And then, on being expressly asked for a formal ruling by the applicant's solicitor on 24 January 1996, the second respondent took another 11 months until 23 December 1996 to not approve the grant of special sick leave to the applicant from 5 August 1989 to 21 September 1995. 40 In this long saga, the applicant has been denied a superannuation benefit, at the least the payment of the lump sum gratuity of 2 years' salary as the minimum entitlement due following the decision on 14 October 1994 by Marks J. He has, therefore, for nearly 6 years been kept out of money otherwise due to him, quite apart from interest thereon, even if the opinion of the second respondent as to the nature of the leave without pay was correct. 41 The first respondent, as the trustee and administrator of the Police Superannuation Fund, as at 14 October 1994 was in somewhat of a dilemma because the applicant, understandably perhaps in view of the way in which the case was presented to Marks J as a precondition for the grant of an annual superannuation allowance, pressed it for the pension benefit instead of the lump sum benefit based on the completed period of service being at least 20 years. Nevertheless, and consistent with its statutory duties and functions, the first respondent, no doubt having in mind the decision of Marks J, endeavoured to compromise or settle the applicant's claim. I have no doubt it was entitled to do so and, in that respect, I am satisfied the first respondent acted both properly and responsibly in the circumstances in entering a submitting appearance and in reaching an agreement with the applicant as to a consent declaration. However, whether effect may be given thereto depends upon the conclusion I reach as to the argument put by the second respondent that there is no jurisdiction in the Court to make such a declaration. If otherwise there be power, my view is that the particular circumstances of this matter in terms of discretion would warrant the applicant being afforded appropriate relief.

[144]

(6) This Rules does not apply to leave without pay that is sick leave, maternity leave or leave for adoption purposes. 44 The applicant's period of leave from 5 August 1989 to 4 August 1990 was governed by the above provisions. As from 1 July 1990 the Police Service Act 1990 commenced and repealed the Police Regulation Act and the Rules made thereunder. Section 219 of the Police Service Act in sub-s (2)(c) enabled regulations to be made to make provision for or with respect to "the extended, annual and other leave that may be granted to members of the Police Service". With effect as from 1 July 1990, the Police Service Regulation 1990 commenced and in Pt 6 - Leave for Members of Police Service, cl 94(1) in Div 7 - Leave without pay for members of the Police Service, dealt with the subject in substantially the same terms as the former r 77A of the Police Rules and cl 96(1) in Div 8 - Sick leave for police officers,was in substantially the same terms as the former r 76(1)(a) of the Police Rules. I do not, therefore, recite those new provisions, except to comment that they were in force at the time the applicant took his second period of leave without pay from 5 August 1990 until 4 August 1991 and during his later periods of leave until discharge from the Police Service on 21 September 1995. For completeness as to the powers of the second respondent, s 8 of the Police Service Act makes him responsible for the management and control of the Police Service, including the effective, efficient and economical management of its functions and activities, and he may issue instructions to members of the Police Service with respect to its management and control. Also, s 85 of that Act enables the second respondent to determine from time-to-time "the salary, wages or other remuneration of a non-executive officer … except in so far as provision is otherwise made by law". 45 Presumably, the second respondent allowed leave without pay to the applicant under r 77A/cl 94, even though the total period of the leave was about 6 years in separate annual periods and exceeded the specified period of 3 years. In any case, the provision, as it says, "does not apply to leave without pay that is sick leave" so as to expressly recognise that sick leave may be granted as leave without pay. That, I think, is unsurprising having in mind the position of the second respondent under the Police Service Act as the employer of police officers and with the responsibility to manage and control the Police Service, including with respect to industrial matters: see ss 8, 84 and 85 thereof. Sick leave for police officers absent from duty because of infirmity of body or mind is provided under r 76(1)(a)/cl 96(1) as leave on full pay up to a maximum of 75 days in any period of 12 months, although that period may be increased by the second respondent in any particular case. Otherwise, there is no provision in either the former Rules or the present Regulation affecting or limiting the grant of leave without pay that is sick leave. 46 Mr Willis conceded, and although the Rules/Regulation did not provide specifically for the grant of "special sick leave without pay", that the Police Regulation (Superannuation) Act in s 5A(1) obviously contemplated that police officers would have available both "leave without pay" and "special leave without pay" and that administratively the second respondent granted, as Mr Gilchrist's evidence stated, special sick leave either with or without pay. The point made by Mr Willis , however, was that the circumstances here showed the applicant did not meet the criteria for the grant of special sick leave because he had not exhausted all of his leave entitlements at the time; also, counsel said, the applicant requested leave without pay and not sick leave. Therefore, he was not absent on sick leave and the position should not now be changed. 47 The counter submissions by Ms Nomchong on the proper characterisation of the leave were succinct and direct. She submitted - · In circumstances where the applicant advised the second respondent that the basis of his application was inability to perform duties because of a medical condition, the failure of the second respondent to either treat the application as one for sick leave without pay or to inform the applicant of his outstanding leave entitlements so he could avail himself of those benefits was a breach of its obligation as an employer. · The second respondent attempted to mask the true nature of the leave taken by repeating that the applicant only applied for leave without pay. Every application for leave without pay by the applicant was made purely on the basis of his medical condition and there was simply no other way to regard the leave than as sick leave. 48 I have found already that the applicant was absent from duty during the period from 5 August 1989 to 21 September 1995 by reason of his medical condition preventing him from performing his work. In truth, therefore, he was sick and on leave for that reason, a situation known to and acknowledged by Inspector Simpson. But does the fact, as Mr Willis suggested it did, that the applicant applied for leave without pay and not leave without pay that was sick leave or special sick leave mean that the absence should not now be so regarded. I think not. 49 The applicant at all relevant times, as I have found, was sick and that is the only true characterisation which may be given to the leave he took; the leave was taken on the advice of Inspector Simpson but without further advice as to the entitlement to sick leave and other leave accrued. In that situation, it seems to me, the second respondent is simply unable to argue that the leave taken was not taken as sick leave. For instance, the stated policy of the second respondent, as set out in the above extract from NSW Police Circular No 88/220, was couched in terms of "extensions of sick leave will be granted" and "will be placed on sick leave without pay" on the expiration of sick leave credits and accruals of other leave should the police officer concerned so elect - but here, the applicant gave evidence, which I accept, that he thought his leave credits had all been used and he received no advice about them. It would, in my view, be somewhat nonsensical to treat the applicant's absence from duty as anything other than sick leave. He had, I am well satisfied, an entitlement under the then policy to leave without pay which was sick leave and his medical condition was the reason for the absence. It should be so regarded. 50 Indeed, I interpose the observation that the applicant had, as Mr Gilchrist noted, sick leave and other accrued leave available to him as at 5 August 1989, and he could have claimed extended leave and further sick leave - that leave would have been, if taken, on full pay and would thus count as eligible service for superannuation purposes. That it was not so brought to account may be wondered, but, as no relief here was sought in respect of it, I take the matter no further.

[161]

(3) … 52 It will be apparent that the entitlement to a superannuation benefit, either a lump sum gratuity under s 14 or an annual superannuation allowance under s 7, where, as here, the police officer was not hurt on duty but was discharged after being certified as being incapable from an infirmity of body or mind of discharging the duties of his office, is dependent upon the officer's length of service. The applicant had at least 19 years and 4 months of service before being discharged and so qualified for at least the s 14 lump sum gratuity. If, however, he had 20 years or more of service then he would be entitled to an annual superannuation allowance under s 7 according to the number of completed years of service. Where leave without pay occurs during a period of service, as here, then the extent to which such leave is service for the purposes of superannuation is regulated by s 5A. 53 There was no real dispute between the parties of the meaning of the statutory provisions as to leave without pay, rather the disagreement concerned who, whether the first respondent or the second respondent, was properly able to make the decision as to which of the types of leave the applicant was granted. That aspect was related to the jurisdictional arguments and I will, therefore, defer consideration of it until those arguments are considered. I attend at this point to the pure question of statutory construction. 54 The respective definitions of "leave without pay" and "special leave without pay" make it clear to me that s 5A is directed to identifying the service of a police officer who has had a period of leave without pay for the purpose of calculating the relevant superannuation benefit. The section is concerned with the single concept of "leave without pay". "Special leave without pay", according to the definition thereof, is nonetheless leave without pay but which is for specific purposes, namely, sick leave, maternity leave, adoption leave, leave to undertake union duties and leave so declared by the regulations. Here, of course, the relevant purpose is sick leave, so that if the applicant's leave without pay was of that nature then it would be special leave without pay in order to determine his service for a superannuation benefit under s 7 or s 14, as the case may be. 55 In light of the finding I have made as to the true nature of the leave without pay being for the purpose of sick leave, I conclude that from 5 August 1989 to 21 September 1995 the applicant was on special leave without pay within the meaning of that expression in s 5A(1) of the Police Regulation (Superannuation) Act. 56 In turn, the qualifying service under the statute is made referrable to contributions continued to be made by a police officer by way of deductions from the salary of office during the relevant period of leave without pay. In that respect, leave without pay which is not special leave only enables the police officer to contribute during the "initial period" of such leave so that the maximum period for service purposes is that initial period. By reason of cl 6 of the Police Superannuation Regulation 1995, the initial period is prescribed as 3 months so that that is the maximum service which may be counted for calculating superannuation benefits: see s 5A(2) and (4). If a police officer fails to make any payment during that initial period the 3 months may still count as service as it may be deducted in instalments and at such times as the first respondent may determine from any benefit otherwise allowed : see s5A(5). 57 Absence on special leave without pay which, as here, was sick leave attracts under s 5A a potentially greater period of eligible service than the 3 months' initial period of leave without pay for other reasons. A police officer during such absence must, if so directed by the first respondent, make contributions to the Fund as if the officer had continued to receive salary: see s 5A(3). However, an officer who takes such a single period of leave "is not liable to make payments … in respect of any part of the period of special leave occurring more than 2 years after the period of special leave commences": see s 5A(3A). Any part of such a single period of leave taken for which contributions are not payable under s 5A(3) "is not a period of service" for the purposes of the statute: see s 5A(4). Nevertheless, if the officer fails to make any such payment required by s 5A(3), having in mind the 2 years' limitation in s 5A(3), then the unpaid amount shall be deducted, in such instalments and at such times as the first respondent may determine, from any gratuity or allowance payable to the officer under the statute: see s 5A(5)(a)(ii); the period of leave for which contributions remain unpaid is not a period of eligible service: see s 5A(5)(b).

[162]

Eligible service of applicant for superannuation purposes 58 On the basis of that statutory scheme established by s 5A, with which I understood both parties agreed, Ms Nomchong submitted that in this case the first 2 years of the period from 5 August 1989 to 4 August 1991 should therefore count as eligible service for superannuation purposes by reason of the combined operation of sub-ss (3), (3A), (4) and (5) of the section. Thus, the applicant would have in calculating the annual superannuation allowance pursuant to s 7 service of 21 years and 4 months. Although he had actually completed 25 years and 4 months of service to 4 August 1995 before his discharge on 21 September 1995, all service after the 2 years' "cap" in s 5A(3A), and for which contributions were not liable to be made, would not count because of the express exclusion thereof by s 5A(4). It was for this reason Ms Nomchong amended the application on 22 November 1999 to substitute the date of 4 August 1991 for that of 21 September 1995 in the declaration then sought. 59 Mr Willis did not demur from Ms Nomchong's approach but, very properly and fairly if I may say so, he raised the question whether the operation of s 5A should be viewed in this case in light of its terms as at August 1989 when the applicant commenced the period of leave without pay rather than in its present form. In the result, Ms Nomchong at the hearing on 13 March 2000 submitted that under s 5A as it was at that earlier time there was no limit or "cap" of 2 years on the period of special leave without pay in respect of which contributions were liable to be made; therefore, she said, eligible service during a period of special leave was then unlimited and the whole period could count. For the applicant here, that would result in 25 years and 4 months of completed service to 4 August 1995 - Ms Nomchong thereupon moved, without objection, on the further amended application based on a period of special leave from 5 August 1989 to 21 September 1995 and service of 25 completed years. The final form of the declarations thus sought is set out earlier in these reasons. 60 The Superannuation Legislation (Further Amendment) Act 1993 (Act No 111 of 1993), which commenced in relevant respects on 1 January 1994, by Sch 2(3) thereof omitted s 5A (3) and (4) of the Police Regulation (Superannuation) Act and inserted instead new sub-ss (3), (3A) and (4) in s 5A which presently remain in those terms; Sch 2(15) of that amending statute inserted in the principal Act a new Sch 6 - Savings and Transitional Provisions containing cl 2 - Leave without pay, which provided : Leave without pay

[165]

Jurisdictional objections to relief sought 63 It remains to deal with the jurisdictional arguments against the relief sought in the context of the findings made. Those findings included the fact that the applicant between the relevant dates of 5 August 1989 and 21 September 1995 was sick from an infirmity of mind and unable thereby to perform the duties of his office, he was absent on leave without pay and the true nature of such leave was sick leave - the conclusion reached from those findings was that the applicant was on leave without pay which was sick leave so as to be special leave without pay within the meaning of that expression in s 5A of the Police Regulation (Superannuation) Act . Therefore, so it followed, the applicant was entitled to be paid by the first respondent from the Police Superannuation Fund an annual superannuation allowance pursuant so s 7 of the statute on the basis of 21 completed years of service. 64 The three declarations sought address each of the principal findings with the ultimate purpose of the applicant receiving the annual superannuation allowance. In effect, they did so in a stepped process in this way - · a declaration that the relevant period of leave was special leave without pay which was sick leave so as to give eligible service of 20 years or more for the purpose of calculating superannuation benefits; and · a declaration that there was an entitlement to an annual superannuation allowance on the basis of 21 completed years of service. 65 In light of the reasons given earlier, a case on the merits has been made out to support such declarations and, as a matter of discretion, I see no reason to withhold relief if the jurisdiction exists to do so. After all, there is a real controversy between the parties here concerning the right of the applicant to a particular superannuation benefit, which issue has been unresolved for nearly 5 years. As Lord Dunedin said in The Russian Commercial & Industrial Bank v British Bank for Foreign Trade [1921] 2 AC 438 at 448 : The question must be a real and not a theoretical question: the person raising it must have a real interest to raise it; he must be able to secure a proper contradictor, that is to say, someone presently existing who has a true interest to oppose the declaration sought. 66 The proposition on which Mr Willis' challenge against the power of the Court to make the declaratory orders was based on the jurisdiction being limited in present respects to superannuation appeals under s 153(1)(h) of the Industrial Relations Act which referred to the function exercised in relation to such proceedings under ss 40 or 88, depending on the particular scheme in question, of the Superannuation Administration Act 1996. However, so counsel said, the applicant's real grievance was the decision of the second respondent made on 23 December 1996 not to approve the period of leave without pay as special leave. The discretion to make that decision was that of the second respondent under the Police Service Act and the Regulation; there was no statutory right of appeal from such a decision and certainly the first respondent had no role to play in making it being responsible under the Superannuation Administration Act only for the administration of the Police Superannuation Fund and the determination of disputes under the Police Regulation (Superannuation) Act concerning benefits payable from that Fund. 67 Mr Willis , whilst conceding that the second respondent's decision affected the calculation of the applicant's entitlement under the Police Regulation (Superannuation) Act , said it was not a decision "concerning an STC scheme" as referred to in s 67(1) of the Superannuation Administration Act so as to give a right of appeal under s 88(1) thereof to this Court. 68 In the alternative, and in any event, if the operative decision here was that of the first respondent as notified to the applicant on 9 January 1996 advising eligible service of 19 years and 4 months so as to lead to the benefit of a lump sum gratuity and not a pension, any right in the applicant to challenge that decision by way of appeal had been lost. Counsel relied on the fact that any such appeal right was at the time conferred by the Superannuation Administration Act 1991 but which Act was repealed by the present Superannuation Administration Act on its commencement on 1 July 1996. In the absence of a then pending appeal, which would have been preserved by cl 19(1) of Sch 3 to that 1996 Act, there was no saving of any right of appeal not then made. 69 If the Court were to have jurisdiction in this matter, Mr Willis said it had to arise in relation to an "industrial matter" between the applicant and the second respondent. However, on the authority of The King v Kelly; ex parte The State of Victoria (1950) 81 CLR 64 at 84-85 an industrial matter was one arising between an employer and employee in their respective roles as employer and employee. What the applicant had now sought was a change in the status of the leave already allowed and taken and well after his employment by the second respondent had ended. There was, therefore, no relevant industrial matter to which the declarations sought could relate. 70 Ms Nomchong supported the competence of the Court to make the declaratory orders as being, pursuant to s 154(1) of the Industrial Relations Act , "in relation to a matter" in which there was jurisdiction. Counsel said the words "in relation to" should be interpreted widely as should the word "matter". Reference was made in those respects to Fencott v Muller (1983) 152 CLR 570 at 602-610 and to Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 at 289 ff. The fact that declarations of right only were claimed was not a bar to prevent them being made: see s 154(2) of the Industrial Relations Act . 71 The particular "matters" identified by Ms Nomchong in relation to which the declarations were sought were: first, the controversy concerning the determination made by the first respondent, together with the second respondent, in relation to the applicant's claim for a superannuation benefit in the form of an annual superannuation allowance under s 7 of the Police Regulation (Superannuation) Act ; and, second, the dispute between the applicant and the second respondent as to whether the applicant was on leave without pay or special leave without pay which was sick leave during the period from 5 August 1989 to 21 September 1995. The first matter was in relation to the Court's jurisdiction to determine a superannuation appeal under the Superannuation Administration Act. The second matter related to an industrial matter which was within the jurisdiction of the Commission. In either or both cases, the Court was thereby empowered to make the declarations claimed because the relevant "matter" founding jurisdiction was within either the Court's or the Commission's jurisdiction: see the reference in s 154(1) of the Industrial Relations Act to "the Commission (however constituted)". 72 In reply to Mr Willis' submissions, Ms Nomchong denied that the decision by which the applicant was aggrieved was the failure of the second respondent on 23 December 1996 to classify the leave without pay as sick leave. Counsel emphasised that the applicant was aggrieved by all of the decisions taken by the second respondent by failing to treat the leave as being sick leave, including the failure to inform the applicant of his accrued and available leave entitlements to enable him to obtain the benefits provided. The question of the nature of the leave taken by the applicant in the 2 years from 5 August 1989 was at the very heart of his claim - as such, it was an industrial matter so as to found jurisdiction for the relief sought. Ms Nomchong referred to and relied upon the decisions of this Court in Atlantis Relocations (NSW) Pty Ltd (formerly known as Atlantis Removals Pty Ltd) v Department of Industrial Relations (Inspector O'Regan) [1997] NSWIRComm 185 and Re Glass Workers' Redundancy (State) Award [1998] NSWIRComm 297. 73 As to Mr Willis' submission concerning the unavailability of a superannuation appeal to deny the making of a declaratory order in relation thereto, Ms Nomchong said it was erroneous to proceed, as Mr Willis did, on the basis that the decision giving rise to a superannuation appeal was that of the second respondent; counsel said the relevant decision complained of was that of the first respondent made on 9 January 1996 in failing to properly apply the provisions of ss 5A(1) and 7(1) of the Police Regulation (Superannuation) Act and also the determination of Marks J in relation to the medical condition of the applicant. 74 In answer to the submission that the applicant's rights to lodge a superannuation appeal had been lost as from 1 July 1996 on the enactment of the Superannuation Administration Act in its repeal of the former 1991 statute, Ms Nomchong relied on s 30(1) of the Interpretation Act 1987 preserving the appeal right of the applicant under the repealed legislation. Ms Nomchong cited as authority for that Poletti v Ecob [1989] 30 IR 343 and Australian Bank Employees' Union v Australia and New Zealand Banking Group Ltd (unreported, Federal Court, von Doussa J, 12 September 1989). 75 I think the first thing to observe about Mr Willis' jurisdictional argument is that it was based, it seems to me, and as Ms Nomchong correctly identified, on the false premise that the applicant was aggrieved by the second respondent's decision made on 23 December 1996. From there, Mr Willis built his jurisdictional argument but on an incorrect foundation; it was one, in any event, which was not decisive of the power here to make declarations of right in the terms claimed or in terms similar thereto. So too, in my view, Mr Willis was wrong in giving finality, almost exclusively, to what he effectively said was the unfettered discretion of the second respondent to decide the true nature of the applicant's period of leave without pay. Counsel, in my view, was wrong also in thereupon transferring that decision as being binding on the first respondent for the purposes of allowing superannuation benefits under the Police Regulation (Superannuation) Act in the performance of the first respondent's function under the Superannuation Administration Act to determine disputes. I prefer the general thrust and approach followed by Ms Nomchong to the jurisdictional issues.

[166]

Conclusion as to existence of jurisdiction 76 My conclusions in favour of there being jurisdiction to make the declarations sought may be stated relatively shortly. The fundamental nature of the declaratory power in s 154 of the Industrial Relations Act is, in the opinion I hold, based on the existence of a matter about which the Commission (either as the Commission or sitting as the Court) has jurisdiction and even though no consequential relief is or could be claimed. In other words, a declaration of right may be made once there be identified a matter otherwise within the Commission's or the Court's jurisdiction, regardless whether any proceedings exist as to that matter, provided the declaration as sought relates to it. In Atlantis Relocations, the majority of the Full Bench ( Glynn and Maidment JJ, Marks J concurring) put it, in a manner I would respectfully adopt, in this way (at p 4) : The declaratory jurisdiction arises "in relation to a matter" in which the Commission has jurisdiction whether or not any consequential relief is or could be claimed (s 154(1)). The declaratory power is therefore not contingent upon the existence of proceedings which are otherwise within jurisdiction as the power arises in relation to a matter as opposed to proceedings. 77 Given that the Court can only deal with matters within its jurisdiction, it is nevertheless not to the point, but as Mr Willis suggested it was, that the making of declarations here would be directly inconsistent with the decision of the second respondent as to the nature of the leave without pay. I do not apprehend in any way I have been asked ultimately to review that decision - what I have been asked to do is to declare the rights of the applicant in terms of his leave entitlement under his employment relationship with the second respondent and his statutory entitlement to certain superannuation benefits. 78 In Nomad Industries of Australia Pty Ltd v Commissioner of Taxation [1983] 2 NSWLR 56, Rogers J held that the view of the Commissioner of Taxation concerning certain statutory provisions within his administration as to the liability imposed by those provisions did not bar the making of a declaration because such an order by a court was not a "review" but rather established the liability as fixed by law under the statute and was unaffected by any conduct or decision of the original decision-maker. His Honour said (at pp 63-64) : It is unnecessary in the present case to determine what are the outer parameters of the reach of the provision. In my view it is entirely inapposite to say that the declarations sought in the present case constitute a "review" of conduct engaged in by a Commonwealth officer. Whilst I accept that the word is one of wide meaning, as suggested by Waddell J, and normally extends to "any process of examining the correctness of a decision or of any conduct", it seems to me to be a misuse of language to say that a declaration as to the application of a statutory provision is a "review" of the conduct of a particular person.

[167]

The foregoing in essence represents a restatement of the view which I expressed earlier in the year in Clyne v Deputy Federal Commissioner of Taxation [1983] 1 NSWLR 110; (1983) 83 ATC 4001. What the summons seeks is a statement from the court by way of declaration as to the existence or otherwise of a liability imposed by the law. As I have sought to show, no decision of the Commissioner, no conduct of the Commissioner, have anything to say, any role to play, in the answer to be returned to that question. The liability will neither be greater nor smaller, will neither arise nor be extinguished, the time at which liability arises is not fixed, and it is in no wise affected by anything which the Commissioner may do or omit to do. Thus to enunciate judicially by means of a declaratory order that there is no liability does not, in my view, constitute a "review" of any relevant matter. This conclusion adopts the second arm of the submissions advanced by the plaintiff. 79 I think that represents the position before me. It was thus no answer to the exercise of the declaratory jurisdiction to plead that the decision as to the grant of any type of leave to the applicant was confined to the second respondent. What matters, it seems to me, was the right or entitlement of the applicant to certain leave and whether the declaration sought was in relation thereto, provided the subject matter of the leave was otherwise within power. I think it may be undoubted that the Commission has jurisdiction as an industrial matter in respect of leave for police officers: see Industrial Relations Act in ss 6(1), 6(2)(c) (g) and (h), 10, 136, 404 and 405(1)(b); see also Police Service Act in ss 84, 85(1) and 218(1). 80 It follows, I would conclude, that there is power under s 154 of the Industrial Relations Act to make a declaration as to the true nature of the period of the applicant's leave without pay from 5 August 1989 to 21 September 1995. I would only add, in response to Mr Willis' submission that industrial matters concern the relations of employers and employees, that at the relevant time the applicant was employed by the second respondent, albeit on leave, and as to which a dispute arose as to the nature of the leave. 81 I am satisfied too that the declarations sought as to the applicant's rights under the Police Regulation (Superannuation) Act are jurisdictionally competent. The issue in that respect was whether the applicant was truly on special leave without pay which was sick leave during the period of 2 years from 5 August 1989. Contrary to the submission of Mr Willis , that question was to be determined by the first respondent in its administration of the Police Superannuation Fund and in its resolution of disputes thereunder. The view of the second respondent as to the nature of the leave may well be a matter for the first respondent to take into account in forming the view it did, after the applicant was discharged from the Police Service on 21 September 1995, and affirmed by it on 9 January 1996. It was for the first respondent, however, to determine the essential question as to the length of service as required by s 7 of the Police Regulation (Superannuation) Act ; that required a decision by it whether the applicant was on leave without pay or special leave without pay which was sick leave. 82 The essential question so styled, and as I have said, related to an industrial matter as would support the making of a declaration in relation to it. Also, and in any event, I consider it related to the matter of a superannuation appeal against the unfavourable decision of the first respondent declining the applicant an annual superannuation allowance. There is, therefore, jurisdiction to make a declaratory order as sought on either basis. 83 For completeness, I should identify the relevant provisions of the Superannuation Administration Act which would enable the Court under s 153(1)(h) of the Industrial Relations Act to determine proceedings on a superannuation appeal, as follows - s 4 Police Superannuation Fund is a fund or scheme under the Police Regulation (Superannuation) Act being an STC fund or STC scheme.

[174]

s 88 A person aggrieved by a determination of the first respondent may appeal to the Court against the determination within 6 months thereof or within such further time as the Court allows. 84 I think it plain that the present dispute as to the entitlement of the applicant to an annual superannuation allowance under the Police Regulation (Superannuation) Act relates to a superannuation appeal able to be brought to this Court under the Superannuation Administration Act and so competent to be the subject of a declaratory order. 85 Mr Willis' point, however, was that any appeal rights were lost by the applicant when the present Superannuation Administration Act repealed the former Superannuation Administration Act 1991 on 1 July 1996 because the relevant appellable decision of the first respondent was made on 9 January 1996. I disagree and would adopt the reasoning in that respect of the majority of the Full Bench ( Hill and Hungerford JJ, Peterson J dissenting) in Hollingsworth v Commissioner of Police (1998) 47 NSWLR 104; (1998) 81 IR 276 as to the survival of statutory appeal rights notwithstanding the repeal of the statute granting the right. It would require, in my view, clear and unambiguous words in the repealing statute to abolish existing rights: see also Beahan v Bush Boake Allen Australia Ltd (1999) 47 NSWLR 648 at 664, (1999) 93 IR 1 at 14; Maxwell v Murphy (1957) 96 CLR 261 at 267-268; and Ogden Industries Pty Ltd v Lucas (1967) 116 CLR 537 at 564. There is nothing in the 1996 repealing Act here which, as I read it, does so. As Ms Nomchong submitted, s 30(1) of the Interpretation Act saved the provisions of the former Act so as not to affect the applicant's rights acquired thereunder to appeal against a determination of the first respondent. It was common ground that the relevant provisions of the former statute in respect of appeals were effectively the same as under the present statute. I note also that although the time period within which an appeal may be brought is 6 months, that period may be extended by the Court - I would have thought that if any case justified an extension of time, the circumstances of this case would do so. 86 I am, therefore, of the view that jurisdiction exists to make the declarations sought.

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (180 paragraphs)

Parties

Cases Cited (12)