[2013] HCA 26
Wilson v Chan & Naylor Parramatta Pty Ltd (2023) 103 NSWLR 140
Source
Original judgment source is linked above.
Catchwords
[2013] HCA 26
Wilson v Chan & Naylor Parramatta Pty Ltd (2023) 103 NSWLR 140
Judgment (5 paragraphs)
[1]
Background
The background to the Applicant's case, according to his Points of Claim, is that he first took out an Income Protection Insurance policy in around 1987. In around 1991 he reviewed his policy coverage and increased it from 2 years illness coverage to lifetime coverage. He understood the policy included premium increases on a 5 yearly basis until he reached 55 years of age, and would remain at the same premium from age 56 to 65 years old. In 2017 he submitted a claim on the basis of his Post Traumatic Stress Disorder, which was accepted. The monthly benefit at that time was $7633.77 plus a 25% no claim bonus, totalling $9542.21 per month. In 2022 he was notified of changes to the monthly benefits as a result of a 'sickness benefit rider', which he claims he did not agree to. He was also notified of the cancellation of his no claim bonus. This reduced his monthly benefit considerably. In 2023 the Applicant submitted a number of complaints to the Respondent in relation to his policy and benefits. He claims that he did not agree to and was unaware of the application of the sickness benefit rider, and that his disability was not a 'sickness', but an injury, to which the sickness benefit rider did not apply.
The Applicant's complaint is that the enaction of a Sickness Benefit Rider on 28 October 2022, following his 65th birthday, was age discrimination and disability discrimination. The rider reduced payments of benefits to a policyholder whose disability claim was accepted as "sickness" from the age of 56 to 64. The Applicant's illness commenced at the age of 59 years old. He claimed:
If an injury resulted in the same total disability there would be no adverse effect, agreed benefit amount for lifetime.
I questioned the fact that [the Respondent] continued to charge 100% premiums after 55 years of age and did not reduce the additional premium knowing that the benefit could produce as much as 90% by the age of 64.
I questioned the fact that the delineation at 55 was a random age and could not be justified with medical evidence.
I questioned the logic of putting injury and sickness into different payment scales as both result in total disability.
I believe the statement given by [the respondent] representative that sicknesses are increasingly naturally likely to occur as we age is also discriminatory.
The Respondent's evidence demonstrated that the Applicant's monthly benefit under the insurance policy was reduced to 60% of the maximum benefit amount on 28 October 2022, following his 65th birthday. Correspondence from the Respondent to ADNSW states that the Sickness Benefit Rider was in place from 1990, prior to the Applicant taking out the policy, and that the reducing benefits were calculated in accordance with statistical data available at that time (the CIDA85 dataset).
Section 49M of the Act states:
(1) It is unlawful for a person who provides, for payment or not, goods or services to discriminate against a person on the ground of disability--
(a) by refusing to provide the person with those goods or services, or
(b) in the terms on which he or she provides the person with those goods or services.
(2) Nothing in this section renders it unlawful to discriminate against a person on the ground of the person's disability if the provision of the goods or services would impose unjustifiable hardship on the person who provides the goods or services.
Section 49ZN of the Act states:
(1) It is unlawful for a person who provides, for payment or not, goods or services to discriminate against another person on the ground of age--
(a) by refusing to provide the other person with those goods or services, or
(b) in the terms on which the other person is provided with those goods or services.
(2) Nothing in subsection (1) applies to or in respect of--
(a) benefits, including concessions, provided in good faith to a person by reason of his or her age, or
(b) holiday tours offered or provided to persons who are of a particular age or age group.
(3) Nothing in this section renders it unlawful for a person to discriminate against a person on the ground of age in disposing of goods, or in providing services, by gift or will or in accordance with the terms of a gift or will.
The Tribunal understands the Applicant's claim to be that the application of the Sickness Benefit Rider constituted the terms on which he was provided with goods or services, being the Insurance policy.
[2]
Whether the defence is genuine
The Act provides for specific defences which, if accepted, result in discrimination not being unlawful. Relevantly, the Respondent has raised the following as defences capable of making its conduct not unlawful:
1. ss49M and 49ZYN are invalid under s 109 of the Constitution on the basis that they are inconsistent with certain provisions of the Commonwealth Life Insurance Act 1995;
2. ss49Q and 49ZYT of the Act apply as exceptions to ss 49M and 49ZYN (respectively); and
3. to provide the policy without the alleged discrimination would impose unjustifiable hardship on it pursuant to ss 49M(2) of the Act.
In Burns v Corbett (2018) 265 CLR 304; [2018] HCA 15 (Burns) the High Court made clear that this Tribunal has no jurisdiction to exercise judicial power over a matter within federal jurisdiction. That is because this Tribunal is not a court and, more precisely, not a Court of a State endowed with jurisdiction under Chapter III of the Constitution: Burns at [55] (Kiefel CJ, Bell and Keane JJ), [68]-[69] (Gageler J). This Tribunal does, however, have incidental (or anterior) jurisdiction to decide whether proceedings brought before it are within its limited jurisdiction: State of New South Wales v Kable (2013) 252 CLR 118; [2013] HCA 26; Wilson v Chan & Naylor Parramatta Pty Ltd (2023) 103 NSWLR 140; [2020] NSWCA 213 (Wilson NSWCA); Citta Hobart Pty Ltd v Cawthorn [2022] HCA 16 (Citta).
Part 3A of the CAT Act deals with 'Federal Proceedings'. Section 34A defines 'federal jurisdiction' as jurisdiction of a kind referred to in ss 75 or 76 of the Constitution. The Tribunal has no jurisdiction to determine such matters, it not being one of the "courts of the States" as referred to in s 77 of the Constitution: Burns per Kiefel CJ, Bell and Keane JJ. The "subject matters identified in ss 75 and 76 of the Constitution" include, at s 76(i) and (ii) of the Constitution:
The Parliament may make laws conferring original jurisdiction on the High Court in any matter:
(i) arising under this Constitution, or involving its interpretation;
(ii) arising under any laws made by the Parliament;
Section 109 of the Constitution states:
When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid.
The application of s 109 of the Constitution to these proceedings fundamentally involves interpretation of the Constitution. The question of whether section 49M and 49ZYN of the Act are inconsistent with the provisions of the Life Insurance Act 1995 (Cth) is therefore a matter of federal jurisdiction, which this Tribunal can neither consider nor determine.
In Citta the High Court held that where there is a 'justiciable controversy' in issue involving the exercise of federal jurisdiction, then a State Tribunal does not have jurisdiction. The High Court specified at [31] that this included "a defence that is asserted in the course of the controversy":
Amongst the circumstances in which a justiciable controversy answers the description in s 76(ii) of a matter "arising under" a law made by the Commonwealth Parliament is where a Commonwealth law is relied on as the source of a claim or a defence that is asserted in the course of the controversy (LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581, [other citations omitted]). And amongst the circumstances in which a justiciable controversy answers the description in s 76(i) of a matter "arising under" the Constitution is where the invalidity or inoperability of a Commonwealth or State law is asserted in the course of the controversy in reliance on the Constitution.
This Tribunal does not need to consider the merits of the constitutional defence raised by the Respondent. As stated in Citta at [45] - [46]:
Whatever the merits of the constitutional defence, there is and could be no suggestion that the constitutional defence was not genuinely raised or is so incoherent as to be insusceptible of judicial determination on those merits.
Together with the claim of the respondent to a remedy under the State Act, the constitutional defence therefore formed part of and gave character to a single justiciable controversy comprising a matter within the description in each of s 76(i) and s 76(ii) of the Constitution. For that reason, the hearing and determination of the claim, no less than the hearing and determination of the defence, was beyond the jurisdiction conferred on the Tribunal by the State Act. The Tribunal was correct so to decide.
All this Tribunal can therefore consider in the context of this application is whether the defence is "genuinely raised" and is not "so incoherent as to be insusceptible of judicial determination on those merits": Citta at [45].
The Respondent's submission is essentially that its insurance policies, including the policy subject to the Applicant's complaint, are governed by the Life Insurance Act 1995 (Cth). The Life Insurance Act 1995 created a scheme to protect the interests of life insurance policy holders, by guaranteeing the capacity of life insurance companies to indemnify policy holders, when this was required, in accordance with the terms of the policies. It requires life insurance companies to appoint actuaries and rely on their approval for policies, and compliance with specific prudential standards and subject obligations.
The Respondent submitted that the Policy which is the subject of the Applicant's complaint was a "life policy" within the meaning of s 4(1) of the Life Insurance Act 1945 on the basis that it was "a policy insuring payment of money … on the happening of any contingency dependent on … continuance of human life" with provision for "a benefit under a continuous disability insurance contract", specifically, "a contract of insurance … whereby any person is to become entitled to a benefit in the event of … injury or disability caused by accident or sickness". Under the Life Insurance Act 1995 (Cth), which had applied since 1 July 1995, the Policy was submitted to be a "life policy" within the meaning of the Dictionary at Schedule 1 and s 9, on the basis that it is a "continuous disability policy" within the meaning of s 9A.
The Applicant submitted that the insurance policy did not fall within the Life Insurance Act 1995 because the actions of the Respondent in applying the Sickness Benefit Rider on 28 October 2022 "permit alteration to my benefits". He relied on s 9A(3) of the Life Insurance Act 1995 (Cth) which provides:
(3) A contract of insurance is not a continuous disability policy if the terms of the contract permit alteration, at the instance of the life company concerned, of the benefits provided for by the contract or the premiums payable under the contract.
It may be, ultimately, that a Court agrees with the Applicant and determines that the insurance policy which is the subject of his discrimination complaint is not a policy within the meaning of the Life Insurance Act 1995 (Cth). The determination of that issue, however, requires consideration of federal legislation. This Tribunal is unable to determine that issue because to do so would involve an exercise of federal jurisdiction.
It is clear from the Respondent's Amended Defence - and from its Defence, even if it were not amended - that the constitutional issue raised as Grounds 4 and 4A are "genuinely raised" and are not "so incoherent as to be insusceptible of judicial determination on those merits". Consideration of those defence grounds would require an exercise of federal jurisdiction, which means this Tribunal has no jurisdiction to determine the Applicant's complaint.
[3]
Conclusion
In circumstances where the Tribunal does not have jurisdiction to determine the Applicant's complaint, it cannot hear the complaint. There remains a question as to what is the appropriate order for the Tribunal to make in the circumstances of the Respondent's application to dismiss the proceedings. Previously, where the Tribunal has determined that it does not have jurisdiction to determine a matter which raises federal jurisdiction, the approach to the making of the order has not been uniform: in Gleeson v Cavers; Cavers v Gleeson [2021] NSWCATCD 158, Eddings v Feros Care Limited [2023] NSWCATCD 126, Blanch v Smith [2024] NSWCATAD 20 and Dennis v Smith [2024] NSWCATAD 91, the applications were "declined", while in Australian Postal Corporation v Lux Cuttings Pty Ltd [2023] NSWCATAP 316 and Borg v Aware Super Pty Limited [2024] NSWCATAD 196, the applications were "dismissed". It was on that basis that the Tribunal requested additional written submissions from the Respondent, specifically on the form of orders being sought.
In Jeray v Information and Privacy Commission [2024] NSWCATAP 239 at [150] the Appeal Panel referred to the power to dismiss proceedings for want of jurisdiction being conferred by either s 55(1)(b) of the CAT Act or 'necessarily implied from the Tribunal's duty to act within its own jurisdiction', referring to the decisions of Cornish v Penrith City Council [2024] NSWCATAP 107 at [12], which identified that there is no explicit power to dismiss for jurisdiction under s 55(1)(b), but that such proceedings are instead considered to be 'misconceived' or 'lacking in substance'; Commissioner of Police, NSW Police Force v FYH [2024] NSWCATAP 176 at [25], where the Appeal Panel expressed that it was not necessary for the Tribunal to dismiss an application under a specific provision of the CAT Act because "the Tribunal could simply have dismissed for want of jurisdiction"; Citta Hobart Pty Ltd v Cawthorn (2022) 276 CLR 216; [2022] HCA 16 at [21]; STAR Training Academy Pty Ltd v Commissioner of Police [2021] NSWCATAP 370 at [21].
As discussed in those authorities, whilst s 55 of the CAT Act does not contain an express power to dismiss an application on the basis of jurisdiction, s 55(1)(b) has often been relied upon by this Tribunal as the power for such an order. There is no need for this Tribunal to rely on an express provision to dismiss proceedings for want of jurisdiction. As stated in Citta at [21], if a Tribunal does not have an express power, the power to do so is implied:
Having a judicially enforceable duty to comply with the limits of its own jurisdiction, a court or a non-court tribunal must have power to take steps needed to ensure its own compliance with that duty. If not expressed in the legislation establishing the court or non-court tribunal or in the legislation conferring jurisdiction on it, that power is necessarily implied on the basis that "everything which is incidental to the main purpose of a power is contained within the power itself"[25].
Section 29(1) of the CAT Act provides that proceedings under the Act involve the Tribunal's "general jurisdiction". Section 108 of the Act limits the orders that can be made by the Tribunal in proceedings under the Act, specifying at s 108(1) that:
(1) In proceedings relating to a complaint, the Tribunal may -
(a) dismiss the complaint in whole or in part, or
(b) find the complaint substantiated in whole or in part. the Tribunal can either.
Section 4 of the CAT Act provides that a decision concerning whether the Tribunal has jurisdiction to hear a matter is an "ancillary decision". This, presumably, is the reason why the Respondent amended its dismissal application from being titled as "Interlocutory Application" on 19 June 2024 to "Ancillary Application" on 4 July 2024.
Section 29(2) of the CAT Act provides jurisdiction to determine an ancillary question as part of the Tribunal exercising its "general jurisdiction", and contains an implied power to dismiss the application. The sub-section provides:
(2) The Tribunal also has the following jurisdiction in proceeding for the exercise of its general jurisdiction -
(a) the jurisdiction to make ancillary and interlocutory decisions of the Tribunal in the proceedings,
(b) the jurisdiction to exercise such other functions as are conferred or imposed on the Tribunal by or under this Act or enabling legislation in connection with the conduct or resolution of such proceedings.
(Emphasis added)
Section 29(2)(a) of the CAT Act thereby also contains an implied power for the Tribunal to dismiss proceedings for which it does not have jurisdiction. There is no statutory basis upon which the Tribunal can 'decline' to deal with an application.
The Respondent submitted that the correct form of order was to refuse to determine the Applicant's application, pursuant to s 5(2)(c) of the CAT Act:
If the Tribunal is to make a decision that the application is without jurisdiction then it should adopt an appropriate order available to it in s 5(1). It does not have the power to use some other form of order unless that is provided expressly by statute or by implication therefrom. The most appropriate of those orders in s 5(1) is "refusal".
Section 5(2) then confirms that approach and the legislative basis for that approach.
Section 5 of the CAT Act defines what a "decision" is:
5 Meaning of "decision"
(1) In this Act, decision includes any of the following -
(a) making, suspending, revoking or refusing to make an order or determination,
(b) giving, suspending, revoking or refusing to give a certificate, direction, approval, consent or permission,
(c) issuing, suspending, revoking or refusing to issue a licence, authority or other instrument,
(d) imposing a condition or restriction,
(e) making a declaration, demand or requirement,
(f) retaining, or refusing to deliver up, an article,
(g) doing or refusing to do any other act or thing.
(2) For the purposes of this Act -
(a) a decision is made under enabling legislation or this Act if it is made in the exercise (or purported exercise) of a function conferred or imposed by or under the enabling legislation or this Act, and
(b) a decision that purports to be made under enabling legislation or this Act is taken to be a decision made under the enabling legislation or this Act even if the decision was beyond the power of the decision-maker to make, and
(c) a refusal of a decision-maker to make a decision under enabling legislation or this Act because the decision-maker considers that the decision concerned cannot lawfully be made under the enabling legislation or this Act is taken to be a decision made under the enabling legislation or this Act to refuse to make the decision requested, and
(d) a failure by a decision-maker to make a decision within the period specified by enabling legislation or this Act for making the decision is taken to be a decision by the decision-maker at the end of the period to refuse to make the decision.
In my view the dismissal of these proceedings for want of jurisdiction, for the reasons discussed above, are not a "decision" made by a "decision-maker" within the meaning of s 5(1)(a) read with s 5(2)(c). This Tribunal is not the 'decision-maker' as defined by s 6 of the CAT Act. As discussed in the Appeal Panel decisions cited above, the dismissal of proceedings for want of jurisdiction is an 'ancillary' decision within the meaning of s 29(2)(a) of the CAT Act for which the Tribunal has an implied power. The appropriate order is therefore to dismiss the proceedings on the basis that the Tribunal does not have jurisdiction to hear and determine the Applicant's complaint.
Under s 34B of the CAT Act, the Applicant may make an application involving federal jurisdiction to 'an authorised court'. Section 34A defines an 'authorised court' to be the District Court or the Local Court. The Applicant may therefore, following this decision to dismiss his application, make an application to either the Local Court or the District Court to consider his complaint of discrimination against the Respondent.
[4]
Order
1. The Tribunal dismisses the proceedings on the basis that it does not have jurisdiction to hear and determine the Applicant's complaint.
[5]
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 20 December 2024
Michael McNally (the Applicant) obtained income protection insurance cover in 1991 with Australian Casualty & Life, the predecessor of Resolution Life Australasia Limited (the Respondent). The Respondent currently holds rights and responsibilities in relation to that insurance cover. In 2017 the Respondent accepted the Applicant's claim for Total Disability due to Post Traumatic Stress Disorder and began paying him monthly benefits in accordance with the insurance policy. After the Applicant's 65th birthday, the monthly benefit paid to him for the "lifetime cover" was reduced by 60% pursuant to a "rider" on the policy. The rider stipulated a percentage reduction of benefit corresponding to the age at which total disability commenced, which in the Applicant's case was at age 59.
On 6 September 2023 the Applicant made a complaint to Anti-Discrimination NSW (ADNSW) alleging that the Respondent unlawfully discriminated against him on the grounds of disability and age, in the provision of goods and services, when in November 2022 it enacted the policy rider causing a reduction in the monthly benefit paid to him.
On 27 February 2024 ADNSW referred the Applicant's complaint to this Tribunal pursuant to s 93C(b) of the Anti-Discrimination Act 1977 (NSW) (the Act). On 25 March 2024 the Applicant filed a document titled "Particulars" outlining his Points of Claim. On 18 April 2024 the Respondent filed and served Points of Defence which included the defence that pursuant to s 109 of the Commonwealth Constitution, the prohibitions on disability and age discrimination in ss 49M and 49ZYN of the Act are invalid on the same basis that the former s 49K(1) of the Act was held to be invalid in Australian Mutual Provident Society v Goulden [1986] HCA 24; (1986) 160 CLR 330.