CONSIDERATION
16 Disregarding the wholly inappropriate claims made under the Misrepresentation Act, the Fair Trading Act and the Corporations Act, the deficiencies of the amended statement of claim are obvious enough. The single question raised by the pleading is whether, having regard to the circumstances of Mr Kowalski's cessation of employment by MMAL on 16 March 1994 and the terms of the Trust Deed and its Schedule C, the pleading sufficiently discloses a reasonably arguable cause of action against MMA Super - hence AMP Super - in respect of its administration of the fund vis-à-vis Mr Kowalski. The technical answer to that question must be no.
17 While the structure of the Trust Deed and Schedule C is such that, in the circumstances, Mr Kowalski had some entitlement to be paid a sum out of the fund, the deed did not give him any absolute entitlement to be paid a TPD Benefit as such. For such a benefit to be payable the trustee had to determine whether Mr Kowalski fell within the definition of "Total and Permanent Disablement" in cl 1(6) of the Trust Deed. Part (b) of that definition required the trustee to form an opinion as to whether Mr Kowalski was incapacitated to such an extent as to render him unlikely ever to engage or work for reward in any occupation for which he is reasonably suited by education, training or experience. The cl 1(6) determination and the opinion embedded in it were ones for the trustee not the court: see Ford and Lee, Principles of the Law of Trusts, [5185] and the cases cited therein. Accordingly, absent a favourable determination by the trustee, it cannot be said, as Mr Kowalski claims in his pleading, that he has an entitlement to a TPD Benefit: but cf Minehan v AGL Employees Superannuation Pty Ltd (1998) 134 ACTR 1 at [68] where the court itself executed the trust - a rare event.
18 Again the pleading alleges repeated failures by the trustee to consider any of the medical evidence that was available to it and hence whether he was entitled to a TPD Benefit. Assuming that there were times at which a duty to consider so arose, the most that Mr Kowalski could expect from a court by way of relief - if any - would be a direction to the trustee to consider whether, in the circumstances, a cl 1(6) determination should be made and this on the basis of an unreasonable and culpable failure to consider the matter. Mr Kowalski does not seek such relief in this proceeding.
19 Underlying Mr Kowalski's complaint about the trustee's omission, though, would seem to be an unformulated assertion that a determination under cl 1(6) adverse to him had been made. I put the matter this way for this reason. I earlier referred to the correspondence between Mr Kowalski and the trustee concerning his formal application for a TPD Benefit. This evidence was put on by Mr Kowalski. In the course of that correspondence the trustee's solicitors indicated on instruction that "the Trustee has previously considered and declined your claim for a TPD benefit from the Fund arising from your employment to 16 March 1994 and including its cessation on that date". Mr Kowalski is unrepresented. In the distinctive circumstances of this matter where he cannot be expected fully to understand the mysteries of the law of trusts, it is proper for the court to endeavour within appropriate limits to ascertain the right that confusedly such a litigant could well be seeking to assert: cf Neil v Nott (1994) 121 ALR 148 at 150.
20 In his oral submissions Mr Kowalski indicated that, though it was said in the 24 February 2006 letter that the trustee had made a determination adverse to him, he has not been provided with a copy of it or, I would infer, the reasons for it. He equally says he has put on such evidence as he could to satisfy the trustee for cl 1(6) purposes.
21 There is now a significant body of Australian case law dealing with challenges to the decisions of superannuation trustees not to provide a particular benefit to a member because the trustee has determined that the member did not fall within the relevant trust definition for that benefit. Many of these cases have involved claims for total and permanent disability benefits having criteria similar to those embodied in cl 1(6): see eg Jeffrey Guy Baker v Local Government Superannuation Scheme Pty Ltd [2007] NSWSC 1173; Hay v Total Risk Management Pty Ltd [2004] NSWSC 94; Sayseng v Kellogg Superannuation Pty Ltd [2003] NSWSC 945; Flegeltaub v Telstra Super Pty Ltd [2000] VSC 107; Minehan v AGL Employees Superannuation Pty Ltd; Vidovic v Email Superannuation Pty Ltd (unreported, Supreme Court of New South Wales, Bryson J, 3 March 1995).
22 I will return below to the question of the grounds upon which a court will review and set aside a discretionary decision of a superannuation trustee denying a member's entitlement to a claimed benefit. What I wish first to emphasise is that it has not been suggested that Mr Kowalski was provided with reasons for the trustee's determination adverse to his TPD Benefit claim, nor have I been taken to such reasons. I would also add that there is medical evidence before me which, if accepted, would suggest so far as it goes that Mr Kowalski could reasonably be found to satisfy the cl 1(6) definition. In these circumstances, if there was not counterveiling evidence - and there was some evidence of asserted fitness for work at the relevant time - the absence of reasons for a decision could assume uncommon significance.
23 Accepting that both under the general law and under cl 3(1) of the trust deed, MMA Super had no duty to give reasons for its adverse determination, a failure to give reasons in circumstances where explanation might be called for is another matter. As Young J observed in Maciejewski v Telstra Super Pty Ltd (1998) 44 NSWLR 601 at 604, in dealing with the suggestion that because a trustee is not bound to give any reasons, therefore the matter is completely unreviewable:
Nothing could be further from the truth. Indeed, whilst trustees do not have to give reasons in a case where a plaintiff puts forward a prima facie case that the trustee's discretion has miscarried, the absence of reasons and the absence of any evidence before the Court as to what happened, will tend to make that prima facie case a virtual certainty.
This view has been endorsed in many subsequent cases: see Baker v Local Government Superannuation Scheme Pty Ltd; Hay v Total Risk Management Pty Ltd; Alcoa of Australia Retirement Plan Pty Ltd v Thompson (2002) 116 FCR 139 at [37]; Flegeltaub v Telstra Super Pty Ltd; see also Butler LM, "Reviewing Trustees' Decisions: The Right to Reasons"(1999) 7 Aust Property LJ 251.
24 I am in no position, on the material before me, to determine whether such a prima facie case is discernible in the evidence before me. The amended statement of claim has not been prepared with such a claim in mind and no defence has been filed. And I have referred earlier to the lack of clarity in the evidence itself.
25 For present purposes, I accept that the grounds upon which a court will review an exercise of a superannuation trustee's discretionary determination are essentially those stated by McGarvie J in Karger v Paul [1984] VR 161, though they have been somewhat elaborated - if not adapted: see Baker v Local Government Superannuation Scheme Pty Ltd at [8] - in the superannuation context. They are that the discretion was not exercised in good faith; that there was not a real and genuine consideration of the correct question; that the discretion was not exercised for the purpose for which it was conferred; if the trustee has given reasons for its exercise of discretion, that those reasons were not sound; and, if the material before the trustee can be identified, that the trustee's decision was one that no reasonable person could come to on that material.
26 In applying these grounds it is important to have regard to the superannuation context in which the trustee's decision is to be made. As Bryson J commented in Vidovic v Email Superannuation Pty Ltd:
It is a marked anomaly to use mechanisms drawn from fields of law remote from employment and relating to trusts for bounty or charity to administer important entitlements in an employment relationship. I find it difficult to understand why the entrenchment of such important rights against review is so usual, and why this kind of arrangement is so commonly found acceptable to employees in view of the economic significance of such decisions and the economic function of superannuation, not well represented in the terms of the documents, as a contracted employment benefit for which value is given. These anomalies appear particularly clearly where, as in this case, the fund out of which benefits are paid is contributory and an employee claiming benefits is claiming to be paid, at least in part, in his own coin. In an arrangement with a contractual character in which value is given in the expectation that a benefit will be available in stated circumstances, a construction in which one party has an entire and unreviewable power to determine whether that party will pay a sum of money to the other or retain it in its own funds has an element of absurdity. Language which appears to produce such a result serves to demonstrate the strength of the expectation of all concerned that the exercise of the power will be honest and reasonable. It is only on that expectation that the transaction could, as a practical matter, be expected to take place at all, and there would have to be an entirely explicit exclusion of such an expectation before language literally capable of excluding it should be given that construction. The context of the employment relationship has an influence which it is impossible to exclude from judicial scrutiny and perceptions of reasonableness of decisions under superannuation deeds.