WRIGHT J Joan Beatrice Loudon a retired school teacher, appeals under the Retirement Benefits Act 1982, s77(4) in respect of a decision or determination of the Retirement Benefits Fund Board ("the Board") to reject her application for retrospective membership of the Retirement Benefits Fund ("the Fund").

2. The determination of the Board in respect of which the appeal is brought was made on 30 July 1992 and its substance was notified to the appellant by letter dated 7 August 1992.

"1 The said Board erred in law in taking into account, in

considering the Appellant's application for retrospective

membership, legal advice received by the Board, without

giving the Appellant any opportunity to be heard

concerning the content of that advice.

2 The said Board erred in law in determining that it

could only exercise its powers under Section 87 of the

Retirement Benefits Act 1982 when an individual had lost

a right or privilege 'through no fault of their (sic)

own'.

3 The said Board erred in fact in finding that the

Appellant had lost her right to join The Retirement

Benefits Fund through her own fault.

4 The said Board erred in the exercise of its discretion

in refusing to allow the appellant to exercise her right

to join The Retirement Benefits Fund as from 1st January

1972, notwithstanding that the time prescribed for

exercising that right had expired.

5 The said Board erred in law and in fact in that, in

determining whether the Appellant's application for

retrospective membership should be allowed, it considered

her actions in 1974, rather than her actions between 1st

January 1972 and 30th June 1972, the date upon which her

rights to become a member of the Fund initially expired."

4. Counsel for the parties to the appeal agreed, properly in my opinion, that an appeal under s77(4) has the character of a rehearing de novo. (See Fletcher v Retirement Benefits Fund Board, 39/1973, Nettlefold J). The evidence presented before me consisted of an affidavit by Mrs Louden containing details of her employment history with the State Education Department and her correspondence with the Department and the Board and correspondence between the Secretary of the Tasmanian Teachers' Federation and the Board. Mrs Loudon was cross-examined upon her affidavit. I also admitted de bene esse an affidavit by Patricia Anne Jeffrey, who is another retired teacher previously employed by the Education Department but, having considered that material further since reserving my decision, I have come to the conclusion that it is irrelevant and therefore inadmissible.

5. I find that Mrs Loudon, now aged 67 years, was appointed to the permanent staff of the Tasmanian Education Department on 11 April 1972 with retrospective effect to 1 January 1972. In applying for this appointment by letter dated 30 March 1972 Mrs Loudon specifically sought retrospectivity to 1 January 1972. She concluded her application as follows:

"Should my application be successful, I would be pleased

if you would advise me and forward an application for

exemption from joining the Retirements Benefit Fund."

6. At that time the State Service retirement benefits' scheme was governed by the Retirement Benefits Act 1970, s21(1) of which provided that any person employed in a permanent capacity in the State Service "shall contribute to the Fund as provided in this Part." However, s21(5) provided that a married woman who was not already a contributor to the Fund "may, within six months after becoming a" (permanent) "employee, by notice in writing to the Board, elect to contribute to the Fund ...". Section 21(6) then provided that where a woman did not so elect to contribute to the Fund, "she is not obliged to contribute to the Fund" and in such case "she is not entitled to any benefits under this Act" other than a pension under s30 (which is irrelevant for present purposes).

7. In replying to Mrs Loudon's application to be appointed to the permanent staff the Acting Director of Personnel advised her:

"With regard to your exemption from the Retirement

Benefits Fund, as a married woman you are automatically

exempted unless you wish to contribute."

8. No mention was made in this letter that any election to contribute to the Fund must be made within six months of becoming a permanent employee. Mr Procter, counsel for Mrs Loudon, was critical of this perceived omission but, as Mr Kable, counsel for the Board, submitted, it is a little difficult to see why such information should have been included, particularly as Mrs Loudon agreed in cross-examination that she knew what the Fund was and how it operated and further, that she had effectively "expressly applied for exemption" in her letter. It was, she said, "a deliberate decision" dictated by family opposition to her joining.

9. The applicant was at the time a mature and intelligent woman. There was, in my opinion, no reason for the Education Department to inform her of the time limit upon her electing to join the Fund and I can see no reasonable basis upon which she should have been led to believe, as she claims in par9 of her affidavit, "... that I could elect to contribute to the Fund at any time in the future if I wished to."

10. In October 1974 Mrs Loudon read an article in a magazine called, "The Tasmanian Teacher" dealing with proposed amendments to the Retirement Benefits legislation, the relevant portion of which is set out hereunder:

"Purchasing Service

A provision will be introduced similar to that provided

in South Australia. The following quote from South

Australian Hansard explains the South Australian

position.

'This Clause (Clause 45) provides that such a person (a

new contributor) who joins the fund after attaining the

age of 30 years may in effect "buy" years of service ...

and this may be done by the making of increased

fortnightly contributions or by the payment of a lump

sum. Years so bought will count as years of service for

the purpose of determining the purchaser's final pension

...

The Public Actuary when setting the increased fortnightly

contribution will ensure that it is sufficient to cover

both the fund share of the prospective pension and the

Government's share. This level of contribution is

necessary since the contributor will not be rendering any

service to the Government during the years of service

bought pursuant to this provision.'

The position in South Australia concerning the purchase

of years of service is thus quite clear, and the

Government is prepared to include a similar provision in

the Retirement Benefits Act. The right to purchase years

of service will apply to both new contributors and to

transferred contributions from the Superannuation Fund.

The Government is not prepared to meet the employer's

share of pension in respect of any years bought but not

served."

11. This article led Mrs Loudon to believe that if she joined the Fund as a contributor she could purchase years of service and thus increase her pension entitlement upon retirement. She says in her affidavit that as her family circumstances had changed at this time she "decided to join the Retirement Benefit Fund and purchase years of service". If this was her decision her letter to the Board on 19 November 1974 failed to reflect it accurately. That letter was in the following terms:

"The article in the Tasmanian Teacher for October 1974

has prompted me to write to enquire under what conditions

I might be eligible to join the Retirement Benefits fund

by 'buying' service - a facility not formerly available.

I am at present not a member of the Superannuation Fund.

I am forty eight years of age and am Senior Mistress of

English at Clarence High School at a present salary of

$10,381.

If I am eligible to join, perhaps you could give me some

figures to illustrate some possibilities regarding

contribution and pension. In general, I would prefer to

make a sizeable lump sum payment rather than have the

greater part of my salary deducted.

For example, could you give me some samples of figures as

suggested below

Lump Sum Regular contribution Percentage of final

salary as pension

4000 ? ?

5000 ? ?

smaller amounts] etc etc

12. It is easy to read things into a document if it is read and reread several times, particularly if learned counsel suggest conflicting interpretations of the same document.

13. My initial reading of the letter now in question did not suggest to me that the writer (a) wished to join the Fund as a contributor and (b), as a separate exercise, to consider whether or not she might also choose to purchase years of service to increase her pension entitlement upon retirement.

14. To me the letter carries the clear message that the writer sees the purchase of years of service as a means of giving her an entitlement to join the Fund with retrospectivity to some past date at which she would have been eligible to join had she not previously elected not to contribute. The whole inquiry appears to me to be formulated around the assumption that a lump sum payment could be made to achieve the required degree of retrospectivity. The letter does not suggest to me that the writer is interested in joining the Fund irrespective of whether or not she can purchase years of service.

15. Be that as it may, the Manager of the Fund, Mr Shirley, by letter dated 10 December 1974 authorized the Chief Personnel Officer in the Education Department to arrange a medical examination of Mrs Loudon "for the purposes of joining the Fund". By another letter of 7 January 1975 Mr Shirley advised Mrs Loudon that:

"... we are unable to advise you final details concerning

the buying of service relative to the Retirement Benefits

Fund as we are awaiting details from the Commonwealth

Actuary."

16. The letter went on to advise Mrs Loudon what her pension entitlement would be if she joined the Fund at her then current salary. Mrs Loudon says in par14 of her affidavit that at the time she received this letter she assumed that her "application to join the Retirement Benefits Fund had been accepted." If this was her belief it was quickly dispelled because on 23 January 1975 the Retirement Benefits Fund wrote to her again. As the terms of that letter have an important bearing upon the present application, I set out the text in full:

"Inadvertently the Chief Personnel Officer at the

Education Department was advised on 10th December, 1974

that it would be in order for you to have a medical

examination for the purposes of joining the Fund. This

information was incorrect. Section 21(5) of the

Retirement Benefits Act 1970 states that a married woman

must elect within six months of becoming a permanent

officer if she wishes to join the Fund. As the date of

your permanent appointment was in 1972 the period of

election has expired. Should you wish to join the Fund

it will be necessary for you to provide a reason for the

late application and why it was not made at the

appropriate time.

I apologise for any confusion which has arisen on this

matter."

17. Mrs Loudon took no further action following receipt of this letter. She explains this decision in par16 of her affidavit:

"I did not accept the Boards (sic) invitation to provide

them with a reason for my late application because I

formed the view that a decision with respect to my

application had already been made and that the Board

would not regard my reason for failing to join as valid

and significant enough to warrant changing that

decision."

18. In cross-examination she said that she thought the Board would not consider family opposition (which had been her reason for not joining in 1972) as a good enough reason "so I though it pointless to pursue it." She agreed that the Board's failure to advise her of the six month joining period in 1972 "was largely irrelevant as at 23 January 1975."

19. For thirteen years nothing more happened. In 1988 Mrs Loudon's insurance adviser told her that she should join the Fund and that, under the provisions of the Retirement Benefits Act 1982 it would be possible for her to "back date" her contributions to 1 July 1982.

20. On 8 June 1988 Mrs Loudon applied to become a member of the Fund and she inquired about back dating her contributions to 1982. She gave brief details of her employment with the Education Department since 1968. There were some minor and irrelevant inaccuracies in these details.

21. By letter dated 21 June 1988 the Manager of the Board advised (inter alia):

"In regard to your query concerning recognition of past

service, I advise that in this case it is not possible to

back-date membership to the Fund to 1st July, 1982.

Membership will be effective from the date of receipt of

your election ie 10th June 1988."

22. No mention was made of any right which Mrs Loudon may have had under the 1982 Act, s29 to purchase years of service to enhance her pension entitlement on retirement.

23. By the Retirement Benefits Amendment Act 1989 (No 56 of 1989), s3(4) of the 1982 Act was repealed, a new subsection was inserted in its place and a new subs(4A) was added. These provisions read as follows:

"(4) Where -

(a) throughout a period that ended before the first

commencement day, a contributor was -

(i) an employee within the meaning of the Act of 1938

or the Act of 1970; or

(ii) a person who was not such an employee by reason

only that the employment of that person was not

employment in a permanent capacity; or

(iii) a person of a kind referred to in section 27 (1)

(a); and

(b) the contributor did not, in respect of that period -

(i) make contributions under the Act of 1938 to the

Superannuation Fund; or

(ii) make contributions under the Act of 1970 to the

Fund; and

(c) the contributor, by notice in writing given to the

Board, elects that that period, or a specified part of

that period, be regarded, for the purposes of this Act,

as service -

the Board may, subject to subsection (4a), declare that

period, or part period, to be a period that shall be

regarded as service for the purposes of this Act.

(4a) Subject to subsection (4e), a declaration by the

Board under subsection (4) shall be on the condition that

the contributor, in such manner as the Board determines,

pay to the Board a special contribution, ascertained in

accordance with subsection (4b), that is the actuarial

equivalent of such portion of the additional total

pension benefit payable by reason of the making of the

declaration as is required to be funded otherwise than

under section 63."

24. Mr Procter, counsel for Mrs Loudon, submitted that those provisions had the effect of saying that an employee who had become a contributor before the first commencement day (ie 1 July 1982) but who had not been a contributor during some earlier period, had the option of making a special contribution to the Fund so as to achieve retrospectivity of service for pension purposes in respect of that earlier period. This interpretation was not challenged by Mr Kable, counsel for the Board, and although subs(4) could have been worded much more clearly than it is, I think that Mr Procter's submission is correct.

25. The central point of his submission was that, if Mrs Loudon had been accepted as a contributor in 1974 she would have been a contributor in 1982 also and therefore, in 1989, she would have become entitled to purchase years of service in respect of any earlier period if she wished to do so. Thus, the Board's refusal to accept her as a contributor in 1974 has deprived her of this retrospective entitlement.

26. On 27 March 1990 Mrs Loudon, having been made aware of the 1989 amendment to the Act, wrote to the Board inquiring whether she was entitled to make a payment so as to "back date my contributions to the Retirement Benefit Fund as I understand that the conditions under which this maybe done have recently been amended."

27. In his reply dated 15 October 1990, the Manager of the Fund advised (inter alia), "The recent amendment is restricted to those members who were contributing to the Fund as at 1 July 1982" and therefore, "the recent amendment has no application to your case."

28. Mrs Loudon claims that the reason she was not a contributor in 1982 is that her original application to join had been rejected by the Board.

29. With commendable tenacity she pursued the matter by writing to the Manger of the Fund again on 15 March 1991 stating her case once more in greater detail and asking him to make a recommendation to the Board under the 1982 Act, s87.

"87 - Where the Board is satisfied, after such inquiry as

it thinks necessary, that a person has, otherwise than

through his own fault, lost or ceased to be entitled to a

right, privilege, or benefit under this Act to which he

was otherwise entitled or might have obtained, and that

it is equitable that he should be allowed to have the

enjoyment of the right, privilege, or benefit, the Board

may, with the approval of the Minister, permit the person

to exercise the right or grant to him the privilege or

benefit, notwithstanding that the time prescribed for

doing any act in relation to the entitlement may have

expired.

(2) The Board may, in the exercise of its powers under

subsection (1), impose such conditions and requirements

as it may think just and as the Minister may approve."

31. Mrs Loudon's application under s87 was supported by the General Secretary of the Tasmanian Teachers' Federation but on 19 December 1991 the Board determined not to use its powers to seek the Minister's approval to permit Mrs Loudon to obtain retrospective service. The Board gave Mrs Loudon the opportunity to attend a "natural justice" hearing which she duly attended on 27 February 1992. The Board adhered to its earlier determination following that hearing.

32. Mrs Loudon now appeals pursuant to the 1982 Act, s77(4) which provides:

"(4) A person who is dissatisfied with any decision,

determination, or order, other than a decision,

determination, or order that is declared by this Act to

be final, may, as prescribed in the regulations, appeal

to a judge from that decision, determination, or order,

and the decision of the judge on the hearing of the

appeal is final."

33. Mr Kable submits that whatever my views may be as to the overall justice of permitting Mrs Loudon to obtain contributor status retrospectively, I am in fact precluded from making a determination in her favour because of a recent amendment to s87.

34. That amendment was effected by the Retirement Benefits Amendment Act 1993 (No 38 of 1993). That Act received the Royal Assent on 13 August 1993 and provides:

"This Act is taken to have commenced on 12 October 1992."

...

"5 - Section 87 of the Principal Act is amended by

inserting the following subsection after subsection

(1): -

(1a) The Board must not exercise its powers under

subsection (1) -

(a) so as to allow a person who, at the time the Board

makes a determination under that subsection, is not an

employee or is not a person referred to in section 5 (1)

or 6 (1) to become a contributor; or

(b) so as to allow the date on which a person referred to

in paragraph (a) became a contributor to be varied."

35. Mr Kable argues that as I am dealing with this appeal by way of rehearing de novo, I am required to exercise the powers which the Board would have if it were sitting to adjudicate upon Mrs Loudon's application at the present time. In other words, I am not examining the correctness or otherwise of the Board's decision at the time it was made on 27 February 1992. Therefore I must apply the law as it stands at the time this appeal came before me in November 1993. Accordingly, as Mrs Loudon ceased to be an employee as defined in the Act, s3 when she retired on 27 July 1991 having attained the statutory retiring age of 65 years, she can no longer ask for the exercise of a discretion under s87 because of the clear prohibition contained in s87(1A). The principle upon which Mr Kable relies was recognized by Dixon J (as he then was) in Hume v Higgins (1949) 78 LR 116 at 128, 129:

"The appeal to the Supreme Court from a summary

conviction with s 152 of the Justices Procedure Act gives

is a new hearing upon evidence to be adduced in that

court. The Supreme Court in hearing such an appeal must

proceed by finding the facts as they are known to exist

at the time when it hears the appeal and by applying the

law as it exists at that date to the circumstances so

found. It does not take the facts as appearing from the

evidence before the magistrate and the applicable law as

it stood at the time of the conviction. If in the

meantime the law has undergone any change or amendment by

which the decision of the case would be altered that must

be applied by the Supreme Court and not the law as it

stood at the date of the decision of the magistrate: cf

Victorian Stevedoring and General Contracting Co Pty Ltd

and Meaks v Dignan [1931] HCA 34; (1931) 46 CLR 73, at pp 87, 106-110,

113."

36. This decision was applied by Gibson J in Lewis v French (1962) Tas SR 138.

37. Mr Procter submitted that the principle stated by the High Court in Rodway v The Queen [1990] HCA 19; (1990) 169 CLR 515 at 518 applied in the present circumstances:

"The rule at common law is that a statute ought not be

given a retrospective operation where to do so would

affect an existing right or obligation unless the

language of the statute expressly or by necessary

implication requires such construction. It is said that

statutes dealing with procedure are an exception to the

rule and that they should be given a retrospective

operation. It would, we think, be more accurate to say

that there is no presumption against retrospectivity in

the case of statutes which affect mere matters of

procedure."

38. Mr Procter sought to gain no assistance from the Acts Interpretation Act, s16(1)(c) as the 1992 amendments did not repeal any other enactment (cf Lewis v French (supra)). However he submitted that Mrs Loudon had a vested substantive right prior to the enactment of the 1993 amendments and consequently the common law rule stated by the High Court in the above passage should apply.

39. Mr Kable countered this line of argument by saying that the 1993 amendments plainly indicated that they were to apply instanter to all s87 applications to the Board.

40. In my opinion Mr Kable's submission is correct. Section 87(1A) is a clear, unequivocal and unqualified embargo upon the use of the Board's power to make a determination of the kind now sought by Mrs Loudon.

41. In reaching this conclusion I have no need to subscribe to the views expressed in the opinion of the Honourable H E Cosgrove QC dated 13 October 1992 to which Mr Kable invited my attention. Nor do I find it necessary to refer to the second reading speech recorded in Hansard as given by the Minister upon the introduction of the Bill in May of this year. Indeed, I think this is not a case where the provision of the Acts Interpretation Act, s8B would allow the use of extrinsic material of this kind (cf Walker v FAI Insurance Ltd, 73/1991).

42. It appears to me that s87(1A) makes it quite clear that the time for considering whether the power in question may be exercised is the time when the relevant determination is to be made. There is no suggestion that pending applications to the Board or appeals therefrom are to be exempt. In some respects this is an unsatisfactory basis upon which to determine this appeal and, particularly as my decision is not subject to further appeal by virtue of s77(4), it is desirable, I think, to express my views as to some of the other issues which arose in the course of the appeal.

43. Mr Procter, whilst conceding that his client was not totally without blame for having failed to become a contributor before 1 July 1992, submitted that there was more serious fault on the part of the Board in having failed to explain to her within six months of her appointment to the permanent staff that her election to contribute or not contribute to the Fund at that time must be made within six months or not at all.

44. I have considerable difficulty in accepting such an argument. Section 87(1) provides that the Board, before exercising a discretion in favour of someone like Mrs Loudon, may only do so if it is satisfied that a right, privilege or benefit to which she was entitled or which she might have obtained was lost, "otherwise than through" her "own fault".

45. Causation is essentially a matter of common sense, (March v Stramare Pty Ltd [1991] HCA 12; (1990-1991) 171 CLR 506) and it would be very difficult to conclude that Mrs Loudon's initial indication that she wanted not to be a contributor and her subsequent failure to respond to the Board's suggestion that she should explain that initial decision when the Board wrote to her on 23 January 1975, were not causative of her loss of the benefit which she was seeking under s87(1).

46. It is not a question of apportioning fault for this state of affairs. The Act is quite clear that the applicant under s87 must be able to demonstrate that the desired right, privilege or benefit was lost otherwise than through the applicant's fault. I would find it impossible to reach such a conclusion in the present circumstances. This is not to say that I have no sympathy for Mrs Loudon's position. She was an employee in the service of the State at all relevant times and I would see nothing wrong in principle with her securing retrospectively that which was made available to the contributors in 1989, provided that she was prepared to make an appropriate cash contribution to the Fund. Nor can I see any persuasive argument against this simply because she may have ceased to be an employee before making an application under s87. Although irrelevant for my purposes, I can understand that she would be disappointed and disillusioned to learn that other employees in similar positions to her's have been granted retrospective membership in the past. That she has missed out in the way that she has is due in no small measure to the complex and confusing provisions of the Acts and the somewhat arbitrary provisions which determine which employees can secure retrospectivity and which cannot.

47. However, for the reasons I have given, I am constrained to reject this appeal. The appeal will be dismissed.