Phillips v Commissioner for Superannuation

LEGISLATIVE FRAMEWORK 7 Section 16 of the Act provides for the medical examination of an eligible employee and the issuing of a BCC if the 'Commonwealth Superannuation Scheme Board' (amended fromthe respondent by the Superannuation Legislation Amendment Act 1994 (Cth)) is satisfied there is a real risk that the employee, 'by reason of or for a reason connected with a physical or mental condition or conditions … will not continue to be an eligible employee until the person attains his or her maximum retiring age' (s 16(4)). 8 As noted by the Tribunal, provision for issuing a substitute BCC was originally madeunder s 16(11) and s 66(2) of the Act. By virtue of the Superannuation Legislation Amendment Act 1990 (Cth), s 16(11) was replaced by s 16AC. Under s 21(3) of that Act, s 16AC applies in relation to a question asked of a person or information given before or after the commencement of the section on 1 July 1990. Section 16AC provides for the issue of a substitute BCC where a 'relevant person' breaches the duty of disclosure and is in the following terms: '16AC Issue of benefit classification certificate where duty of disclosure breached (1) In this section: condition means a physical or mental condition. relevant person means: (a) a person: (i) who is an eligible employee; and (ii) who has not attained his or her maximum retiring age; and (iii) whose period of contributory service, if the person were to cease to be an eligible employee, would be less than 20 years; … (2) Subsections (4) to (8), inclusive, apply where the Board is satisfied, in respect of a person who is a relevant person: (a) that: (i) at or in connection with a medical examination that the person was required … to undergo; or (ii) in connection with a request under subsection 16(6) by the person; the person failed to answer properly a question asked of him or her or gave false or misleading information; and (b) that, if the person had answered the question properly or had not given that false or misleading information: (i) where there is in force, or there was in force immediately before the person's retirement or death, a benefit classification certificate in respect of the person - a condition or conditions of the person not specified in the certificate would be or would have been so specified; … (3) … (4) If subparagraph (2)(b)(i) … applies, the Board shall revoke the certificate and issue in substitution for it a new benefit classification certificate in which the condition or conditions referred to in that subparagraph is or are specified either in addition to, or instead of, the condition, or some or all of the conditions, specified in the revoked certificate. (5) … (6) Except for the purposes of this section, a certificate revoked under subsection (4) is taken never to have been issued. (7) A certificate issued under subsection (4) in substitution for a revoked certificate is taken to have been issued on the day on which, and under the provision under which, the revoked certificate was issued. (8) … (9) For the purposes of this section, a person answers a question properly if, and only if, he or she gives in answer to the question all the information that he or she could reasonably be expected to give, on the basis of: (a) his or her knowledge about the relevant matters; and (b) the knowledge that, having regard to his or her knowledge about the relevant matters, he or she could reasonably be expected to have about those matters; if he orshe answered the question fully and truthfully on the basis of the knowledge referred to in paragraphs (a) and (b). (10) In subsection (9): relevant matters, in relation to a question asked of a person, means: (a) in any case - the matters that the person could reasonably be expected to regard as relevant to answering the question; and (b) if the question is asked of the person: (i) at or in connection with a medical examination that the person was required under subsection 16(2) or (6) or 16AB(3) to undergo; or (ii) … (iii) … the person's medical history and past and present state of physical and mental health.' 9 In the event that an employee retires on invalidity grounds before attaining maximum retiring age; there is a BCC in force immediately before the person's retirement; and the Board is of the opinion that the condition(s) specified in the BCC (or a condition or conditions connected with those specified on the BCC) either caused, or substantially contributed to, the retirement condition, s 66(2) of the Act provides for more limited retirement benefits than would otherwise be the case.

Reasons of the Tribunal 10 The issues before the Tribunal were: (a) first, whether the appellant had failed to answer properly the questions asked (or gave false or misleading information); (b) secondly, whether, if she had answered the questions properly, a substitute BCC would have issued, and if so, what condition(s) would have been specified in that BCC; and (c) thirdly, whether the appellant's retirement incapacity was caused, or substantially contributed to, by any condition specified in a substitute BCC, or a condition connected with such condition(s). 11 In relation to the first issue, counsel for the appellant contended before the Tribunal that, in 1983, the appellant had answered the relevant questions truthfully according to her knowledge and her state of mind, and that, from her perspective, the situations which gave rise to her seeking medical treatment involved no more than feelings that commonly occur to people at some time in their lives (such as unhappiness, depression in the colloquial sense, stress, sleep disturbance and tiredness) without implying a 'mental … condition'. Counsel submitted that the appellant honestly believed on 14 July 1983 that she then did not suffer nor had ever suffered from any of the named disabilities or conditions listed in the questions (see [3] above), and that such belief was reasonable given her state of mind and means of information. 12 In relation to the second and third issues, counsel for the appellant submitted, amongst other things, that even if the appellant had responded affirmatively to the relevant questions in the questionnaire, given the state of the information which might have been available in 1983, the only additional condition that would have been included on the substitute BCC was 'schizo affective disorder' (this was the final diagnosis of Dr Weekes, a psychiatrist who had treated the appellant over a period of four months in 1978/1979), a condition which, it was submitted,has no connection, for the purposes of s 66(2), with the appellant's retirement condition, OCD. It was also submitted that there is no connection between depression and/or obsessive compulsive personality disorder and OCD and therefore it would have made no difference if those conditions had been specified in a substitute BCC. 13 The Tribunal accepted that, to some extent, the appellant lacked insight into her psychiatric state, but found that the appellant was aware that she was suffering, or had previously suffered, from a psychiatric condition when she completed the medical questionnaire for superannuation purposes in 1983, and that consequently, the appellant had failed to answer properly a question asked and had provided false information. 14 It further found that if the appellant had answered the question properly, further inquiries would have revealed diagnoses of PD and MDD (see [6] above), and those conditions placed the appellant at greater risk of retirement before her maximum retirement age; thus a BCC would have issued, specifying those conditions. 15 The Tribunal was satisfied that the evidence of Dr O'Brien (a consulting psychiatrist who had treated the appellant during the period of February to December 1987) was to be preferred to the evidence of Dr Frank Varghese (a consultant psychiatrist who saw the appellant on 22 November 2001) and was sufficient to establish that the appellant's OCD (the ground for her retirement) was 'substantially contributed' to by her PD and MDD conditions, which would have been specified in the BCC. DECISION OF THE PRIMARY JUDGE 16 Before the primary Judge, the appellant raised no question of law. She adumbrated two concerns relating to her 'retirement condition', however the primary Judge indicated that the appellant's retirement condition was not in dispute. The appellant raised a third issue in relation to choosing the date of her retirement but, as noted by the primary Judge, this did not form part of the reviewable decision that gave the Tribunal its jurisdiction and was not raised by the appellant before the Tribunal. 17 The primary Judge also considered whether the Tribunal's conclusions might have been vitiated by error of law and found that it was open to the Tribunal to find, as it did, that the appellant had failed properly to answer the questionnaire, and that the Court could not review that finding. Her Honour further found that it was within the Tribunal's power to direct that different conditions be specified in the substitute BCC. 18 Finally, her Honour gave consideration to the Tribunal's determination that there was a link between the condition that caused the appellant's incapacity and subsequent retirement and the conditions listed on the BCC. The primary Judge observed that s 66(2)(c) raises two distinct and alternate questions. The first question is whether the appellant's incapacity was caused or substantially contributed to by a condition or conditions specified in the BCC. Her Honour found that this question must be answered in the negative, as it was accepted on both sides that the retirement incapacity was caused by OCD, whereas the substitute BCC specified PD and MDD. 19 The primary Judge then considered the next question, namely whether there was a connection between OCD and either or both of PD and MDD. In answering this question, her Honour said (at [39]): 'S66(2)(c) does not require a causal connection between the [appellant's] OCD and the conditions specified in the BCC, it requires only a connection between the two conditions. In Commissioner for Superannuation v Benham (1989) 22 FCR 413…, the Full Federal Court identified the correct approach at 421: "The construction which should be adopted, in the case of this Act, is a reading of s 66(2)(c) as referring to cases where there is a real and substantial connection between the certified condition and the condition that caused or substantially contributed to the incapacity." The Court expressly rejected any necessity for a causal relationship between the two conditions.' (emphasis supplied by us) 20 The primary Judge was satisfied, on the whole, that the Tribunal applied the correct test, that the Tribunal's finding of fact was open to it on the evidence and that any error that may have arisen from the Tribunal's choice of language had no practical significance. Accordingly, the appeal was dismissed.

The appeal TO THE FULL COURT 21 By her Notice of Appeal filed 20 February 2004, the appellant relied on the following grounds: '1. That there has been a denial of natural justice in not entertaining [the appellant's] application to admit new evidence (in relation to the [Freedom of Information] material from the [Australian] Federal Police in particular). 2. That there has been a denial of natural justice in not allowing further time for [the appellant] to present her full submission to the …Court.' 22 The appellant has provided written submissions in support of these two grounds. She seeks to set aside the judgment at first instance and to have the matter remitted to a differently constituted Tribunal for re-hearing. 23 In relation to the appellant's first ground, on the hearing of her application before the primary Judge, the appellant sought to tender documents (in a 'supplementary appeal book') that were not before the Tribunal. The appellant submits those documents are 'a development of matters already raised in the course of the … hearing [before the Tribunal].' The tender was rejected and the appellant now claims that she was denied natural justice because she was not permitted to tender that evidence on the hearing of her appeal. 24 Although the appellant, in her grounds of appeal, refers only to information obtained under the Freedom of Information Act 1982 (Cth), the important evidence that the appellant wished to tender concerns the degree of connection between the appellant's prior medical history, as found by the Tribunal, and her retirement condition of OCD. In particular, the appellant sought to tender a letter from Dr John Varghese, psychiatrist, dated 3 September 2003, which stated relevantly as follows: 'It is my opinion that an Anxiety Disorder, a Mood Disorder, or an underlying Personality Disorder marginally increases the risk for one developing Obsessive Compulsive Disorder. Obsessive Compulsive Disorder, however, in the main is regarded as a specific neuro-psychiatric condition with a specific neuro-chemical cause. To develop this, one needs to have a specific biological pre-disposition and subsequent events may unmask this and precipitate out the illness. Stress by itself does not result in Obsessive Compulsive Disorder unless one has a biological vulnerability.' 25 The appellant sought to rely on this new evidence to contend that the connection between her prior medical history and her retirement condition is 'marginal' only and therefore did not satisfy the test outlined in Benham of whether there was a 'real and substantial connection'. 26 Such evidence is contrary to the opinions of two doctors who gave evidence before the Tribunal and to the finding of the Tribunal. Dr Frank Varghese stated in cross-examination that a 'person with obsessive compulsive personality disorder is more likely to develop OCD.' The substance of his evidence, as summarised by the Tribunal is set out below. Dr O'Brien, whose evidence was ultimately preferred by the Tribunal, said as follows: 'The definition of a personality disorder includes the notion that a person uses the same coping mechanisms no matter how inappropriate they might be in a wide variety of settings. Thus their ability to respond to stressful life events may be impaired. An accumulation of life events will thereby stress that person more than the average and they are more likely to be symptomatic, to display illness which would be recognised if you were interviewing them. In my view, Ms Phillips' personality vulnerabilities, [-] her personality disorder [-] is of such an extent that it was evident to Dr Weekes [a psychiatrist], and evident to myself, and evident to Dr [Frank] Varghese, that…it is a personality disorder [which] is a longstanding aspect of her. That vulnerability expressed itself in the 1978 episode after a series of quite difficult stressful events in her life, setbacks and dissatisfactions in the workplace, and stresses in her personal life, and again, it displayed itself through the stresses that she reported to me when she came to see me in 1987 as an obsessive-compulsive disorder. I could add that people with personality vulnerabilities, it is one of the most important determinants of the genesis and chronicity of any psychiatric disorder, that people with obsessive-compulsive personality disorder [are] more likely have a higher risk of depression, of anxiety disorder, including obsessive-compulsive disorder. …There is clearly some association between anxiety disorders and depression. Some psychiatrists would argue that they are quite separate disorders and that we don't yet understand why that happens; that is they believe they are separate entities. Others would hold the view that there are some common underlying factors which you can find in people to explain this.' 27 Dr O'Brien later said in evidence: 'If a person has a personality disorder, and in this case, a personality disorder of the type of Ms Phillips, would she be in - would she be more likely to develop OCD than a member of the general community? --- As I said, she would have a higher risk of a range of disorders , and OCD would be one of those. And a person with recurrent major depression, would they be more at risk of developing OCD than a member of the general community? ---Slightly, but much less relevantly. The connecting, or contributing factor in Ms Phillips' case to the emergence of both illnesses is her underlying personality disorder. And does the fact that a person has a personality disorder and also recurrent major depression, does that add to the prospect of a person developing OCD? --- It makes it more likely that the person would have other illnesses or other episodes of illness. The reason being that if you look at the outcome studies of depression then people with personality disorders will show more of a likelihood of relapse and a higher number of residual symptoms…". 28 Summarising the evidence of the two doctors, the Tribunal said (at [85] - [86]): 'The evidence relevant to the matters in sub-section 66(2) is that of Dr [Frank] Varghese and Dr O'Brien. Dr [Frank] Varghese said that a person with major depression was not at greater risk of contracting other mental problems although he said that there could be conditions associated with the depression such as panic attacks, increased prospect of suicide or alcohol problems. He denied any increased risk of OCD but said that depression might lead to a presentation of OCD symptoms such as recurrent thoughts or checking behaviour rather than primary OCD. Dr [Frank] Varghese also referred to a person who has a general neurotic syndrome as being someone who was vulnerable to the development of either depressive disorder or OCD. In contrast, Dr O'Brien said that a relationship exists between the occurrence of anxiety/depressive disorders and other anxiety-based disorders such as obsessive compulsive disorder and also that an individual with a personality disorder was more likely than another to develop OCD; that an individual with major depressive disorder was at a greater risk of developing OCD; and that an individual with both major depressive disorder and personality disorder was at increased risk of developing OCD. The Tribunal is satisfied that the evidence of Dr O'Brien is sufficient to establish that the applicant's OCD was substantially contributed to by her personality disorder and depressive disorder. Further, the Tribunal prefers her evidence to that of Dr [Frank] Varghese on the basis of her association with the applicant over 10 months in contrast to the single consultation that Dr [Frank] Varghese had with the applicant.' (emphasis added) 29 Counsel for the respondent points out that in an appeal under s 44(1) of the AAT Act, this Court has no power to receive 'fresh evidence'; only questions of law can be raised in such an appeal. In Waterford v The Commonwealth (1987) 163 CLR 54 Brennan J said (at 77 - 78): 'There is no error of law simply in making a wrong finding of fact. Therefore an appellant cannot supplement the record by adducing fresh evidence merely in order to demonstrate an error of fact.' 30 The respondent also relies on Servos v Repatriation Commission (1995) 56 FCR 377 per Spender J at 385: 'As s. 44 of the [AAT] Act makes plain, only questions of law are to be considered at the Federal Court level. The policy of the legislation in my opinion is to make the decision of the Tribunal final on questions of fact. It is inconsistent with that policy to seek to adduce evidence before the Federal Court for the consideration of the court on an application pursuant to s. 44 of the Act, the object of which is to invite the court to disagree with a factual conclusion reached by that Tribunal. In my opinion, consistent with the authorities to which I have already referred, the jurisdiction of the Federal Court of Australia pursuant to s. 44 of the [AAT] Act does not permit the reception of further evidence which was not before the Administrative Appeals Tribunal.' 31 These principles are applicable here. The further evidence sought to be tendered by the appellant relates to a factual issue and even if admitted would not demonstrate any error of law. 32 As indicated above, given that the primary Judge was concerned with whether any error of law attended the conclusion of the Tribunal, her Honour was correct to reject the reception into evidence of material that was not before the Tribunal. The appellant on this appeal pressed that further material and, in particular, the report by Dr John Varghese dated 3 September 2003. That material is not relevant to the disposition of the appeal. 33 The appellant nonetheless contends that this material bears directly on her entitlement. 34 We simply note that Mr Hanks QC, for the respondent, in response to an enquiry by the Court as to whether there was an opportunity to reconsider the entire matter in the light of the medical information now sought to be relied on by the appellant, indicated that 'if a reconsideration' in the circumstance of new and better information coming to light, 'was a possibility, the [Commissioner for Superannuation] would look at it'." 35 In relation to the appellant's second ground, the appellant claims that she was denied natural justice because she was not allowed further time to present her full submission to the Court. This ground concerns the appellant's filing (without leave) of supplementary written submissions after the primary Judge had reserved her decision. It appears that the primary Judge did not consider those supplementary submissions. 36 The respondent submits that the transcript of the hearing before the primary Judge demonstrates that the appellant was not denied the opportunity to make submissions at the hearing, and refers to extracts from the transcript to support this submission, including the following: 'HER HONOUR: …is that all that you want to say about the first part of the Tribunal's decision? [APPELLANT]: Well, …I know I've got heaps of points. I've been through these and I have got - trying to think on my --- HER HONOUR: …we'll be taking an adjournment shortly, …at quarter to one, so why don't you leave that first point and if you think of something over the luncheon adjournment that's different from what you've put to me you can raise it after lunch. In the short time remaining, why don't you go on to address other aspects of the Tribunal's decision that you say involve errors? …is there anything more you wish to add before I call on [counsel for the respondent]? You will have an opportunity, of course, you understand, to respond to what [counsel for the respondent] says. …Ms Phillips, you have an opportunity to respond to points made by [counsel for the respondent]. In doing so, I don't need you to go over points you have already made. You can assume that it's inevitable, of course, there will be disagreement between you, so I need you only to respond, if you wish, in relation to anything you haven't already covered.' 37 The respondent relies on remarks by McHugh J in Eastman v Director of Public Prosecutions (ACT) (2003) 214 CLR 318 at 330: '…a party has no legal right to continue to put submissions to the court after the hearing. In so far as the rules of natural justice require that a party be given an opportunity to put his or her case, that opportunity is given at the hearing.' 38 In our view, it is clear that the appellant was given a full opportunity to put her case and we see no error in the lack of any reference to her intended further submissions. 39 In addition to her specific grounds of appeal, the appellant makes numerous factual criticisms (in both her written and oral submissions) concerning the medical evidence before the Tribunal. Again, the respondent submits that an appeal under s 44(1) of the AAT Act cannot be used as a vehicle to agitate factual issues, or to argue that the Tribunal's findings of fact were erroneous or even against the weight of the evidence, citing, inter alia, Repatriation Commission v Thompson (1988) 44 FCR 20 at 25, quoted below. 40 The respondent further submits there was substantial evidence before the Tribunal that the appellant had a history of personality disorder and recurrent major depression at the time of her entry to the APS, pointing particularly to the report of Dr O'Brien, who 'identified personality vulnerabilities and a history of depression' as placing the appellant at a 'higher risk of retirement before reaching 65', and the report of Dr Frank Varghese, who reported a 'significant past psychiatric history' when treated by Dr Weekes (in 1978), which 'was best understood as a recurrent major depression'. In relation to the Tribunal's preference of one doctor's evidence over another's, the respondent submits that the Tribunal had the opportunity to see both Dr Frank Varghese and Dr O'Brien give their evidence (under cross-examination). 41 In Thompson, above, the Full Court stated as follows (at 24-25): '…it is necessary to keep in mind that the Tribunal was the judge of the facts. As Brennan J said in Waterford v Commonwealth (1987) 163 CLR 54 at 77: "The error of law which an appellant must rely on to succeed must arise on the facts as the AAT has found them to be or it must vitiate the findings made or it must have led the AAT to omit to make a finding it was legally required to make. There is no error in law simply making a wrong finding of fact." The distinction between fact and law has recently been considered by Gummow J in Skypak International (Australia) Pty Ltd v Commissioner of Taxation (unreported, Federal Court of Australia, 20 April 1988) … In marginal cases, the task of distinguishing between an error of law and an error which is not such may be a difficult one. However, the nature of the task of this Court is clear. It is to leave the tribunal of fact decision as to the facts and to interfere only when the identified error is one of law. … When the challenged finding is one of fact, an error of law will only arise if it be found that the finding was unreasonable in the sense expounded in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223, or that the reasoning of the Tribunal disclosed that it approached the issue on a wrong footing by posing the wrong question or otherwise made a legal error which vitiated the finding.' 42 These principles are applicable here. We agree with the primary Judge that the Tribunal's findings were open to it on the evidence before it and no error of law has been established. 43 Finally, the appellant appeared to suggest that the primary Judge erred in her construction of s 66(2) in that her Honour did not apply the correct test for determining whether there was a connection between the conditions ultimately specified on the BCC and the appellant's retirement condition. 44 The primary Judge specifically addressed the issue of the correct test to be applied (at [39]), citing Benham, where it was stated that there must be a 'real and substantial connection between the certified condition and the condition that caused or substantially contributed to the incapacity'. As the primary Judge observed, the test in Benham does not require any causal relationship between the two conditions and we agree that this is the correct approach (c.f. Commissioner of Superannuation v Miller (1985) 8 FCR 153). 45 The appellant did not object to the test as outlined in Benham. However, the appellant contended that the primary Judge only considered whether there was a connection between OCD and either PD or MDD, not whether the connection was real and substantial. 46 The appellant referred the Court to [36] of the judgment at first instance, where the primary Judge said, '[i]s there a connection between OCD and either or both of personality disorder and major depressive disorder?' Later, the primary Judge states (at [42]): '… a decision that the [appellant's] incapacity from OCD was substantially contributed to by personality disorder and/or major depressive disorder necessarily involves a decision that the conditions are connected.' 47 It is trite to say that the primary Judge's judgment must be read as a whole. In circumstances where the primary Judge has elsewhere made clear her understanding that the requirement is that the connection be a real and substantial one (as her Honour did at [39]), when her Honour stated that there is a connection, such a statement must be taken to mean that there is a real and substantial connection, even though the precise words are not used. 48 In our view, there is no substance to the appellant's apparent contention that her Honour erred in her construction of s 66(2). 49 Accordingly, the orders of the Court will be:

1. The appeal is dismissed.
2. The appellant is to pay the respondent's costs of the appeal. I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of this Honourable Court.

Solicitor for the Respondent: Australian Government Solicitor

Date of Judgment: 11 February 2005