Precision Data Holdings Ltd v Wills [1997] FCA 714 | Case summary

The proper construction and application of section 37 gives rise to difficulties but need not be considered here. The review meeting of the Tribunal normally is to be in private. The Tribunal is required to give written reasons for its determination. Under section 46, a party to a review by the Tribunal may appeal to the Federal Court on a question of law, from the determination of the Tribunal. The Resolution of Complaints Act was amended by the Superannuation Industry (Supervision) Legislation Amendment Act 1995 ("the Amending Act") which came into operation on 12 December 1995. The complaint the subject of the determination by the Tribunal relevant to the appeal to this Court was made by Mr Bishop on or about 30 June 1995 under section 14 of the Resolution of Complaints Act then in operation. The complaint was brought by Mr Bishop and appears to have been based upon paragraph 14(2)(c) of the Resolution of Complaints Act then in operation. One of the main purposes of the amendments made to the Resolution of Complaints Act by the Amending Act was to delete paragraphs 14(2)(a) and (b) but provision was made preserving the rights of complainants making a claim before 12 December 1995 and the power of the Tribunal to make the review on their complaint but in the exercise of the power the complaint was to be treated as if it had been made under the Resolution of Complaints Act as amended. The Explanatory Memorandum to the 1995 Bill makes it clear that the amendment to subsection 14(2) was made to remove any possibility that the Tribunal would be exercising judicial power in deciding whether a decision of the Tribunal was in excess of the powers of the trustee or was an improper exercise of the powers of the trustee; compare Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245. In addition the Amending Act inserted additional grounds of complaint namely those now contained in section 14A, 15A and 15B of the Resolution of Complaints Act but those complaints are not relevant for present purposes. Of more importance, the Amending Act substituted a new section 37. The new section 37 is set out:- "37. (1) For the purpose of reviewing a decision of the trustee of a fund that is the subject of a complaint under section 14: (a) the Tribunal has all the powers, obligations and discretions that are conferred on the trustee; and (b) subject to subsection (6), must make a determination in accordance with subsection (3). (2) If an insurer or other decision-maker has been joined as a party to a complaint under section 14: (a) the Tribunal must, when reviewing the trustee's decision, also review any decision of the insurer or other decision-maker that is relevant to the complaint; and (b) for that purpose, has all the powers, obligations and discretions that are conferred on the insurer or other decision-maker; and (c) subject to subsection (6), must make a determination in accordance with subsection (3). (3) On reviewing the decision of a trustee, insurer or other decision-maker that is the subject of, or relevant to, a complaint under section 14, the Tribunal must make a determination in writing: (a) affirming the decision; or (b) remitting the matter to which the decision relates to the trustee, insurer or other decision-maker for reconsideration in accordance with the directions of the Tribunal; or (c) varying the decision; or (d) setting aside the decision and substituting a decision for the decision so set aside. (4) The Tribunal may only exercise its determination-making power under subsection (3) for the purpose of placing the complainant as nearly as practicable in such a position that the unfairness, unreasonableness, or both, that the Tribunal has determined to exist in relation to the trustee's decision that is the subject of the complaint no longer exists. (5) The Tribunal must not do anything under subsection (3) that would be contrary to law, to the governing rules of the fund concerned and, if a contract of insurance between an insurer and trustee is involved, to the terms of the contract. (6) The Tribunal must affirm a decision referred to under subsection, (3) if it is satisfied that the decision, in its operation in relation to: (a) the complainant; and (b) so far as it concerns a complaint regarding the payment of a death benefit - any person (other than the complainant, a trustee, insurer or decision-maker) who: (i) has become a party to the complaint; and (ii) has an interest in the death benefit or claims to be, or to be entitled to benefits through, a person having an interest in the death benefit; was fair and reasonable in the circumstances."

These provisions applied with respect to the determination of the Tribunal the subject of the appeal presently before the Court. The proper construction and application of the new section 37, which applies to the determination of the Tribunal the subject of this appeal, still have their own difficulties but these need not be considered in these reasons. 4. The parties and proceedings before the Court The Trustee and the Insurer appealed to this Court, on questions of law, from the determination of the Tribunal made on 27 February 1996. The determination is set out earlier in these reasons. It will be recalled that under subsection 37(1), in reviewing a decision of the trustee, the Tribunal has all the powers, obligations and discretions that are conferred on the trustee and must make a determination in accordance with subsection 37(3) but limitations are imposed upon the exercise of those powers; see for example subsection 37(5) and (6). The determination made by the Tribunal in this case has the appearance of an order of a court in that it declares that Mrs Bishop had a death benefit at the time of her death under Rule 8.1 of the CARE Rules and identified that interest. The determination then directed that the appropriate payment "be made without further delay in accordance with the Trust Deed and the Insurance Policy" of CARE. No consideration appears to have been given to the exercise of powers under Rule 9.1, a matter which had not been before the Trustee. It is to be noted that under subsection 44(3) of the Resolution of Complaints Act, a trustee or an insurer is guilty of a criminal offence if it intentionally or recklessly refuses or fails to comply with a direction of the Tribunal. 5. The nature of the Tribunal The Court as presently constituted considered the nature of the Tribunal in W. E. Bassett & Partners Pty Ltd v Doherty ( 31 July 1997, unreported). That consideration included a comparison between the nature of the Tribunal and the Administrative Appeals Tribunal ("the AAT") constituted under the Administrative Appeals Tribunal Act 1975 ("the AAT Act"). Those considerations need not be repeated in these reasons. There is no doubt that the Tribunal is established as an administrative body exercising a power of review of decisions made by trustees and, in appropriate cases, insurers with respect to superannuation schemes. There are, however, two important differences between the nature of reviews of the Tribunal and reviews by the AAT. For present purposes, under section 14 of the Resolution of Complaints Act, a person may make a complaint to the Tribunal "that the decision is or was unfair or unreasonable". Under subsection 37(6), the Tribunal must affirm the decision the subject of the complaint if it is satisfied that the decision, in its operation in relation to the complainant 'was fair and reasonable in the circumstances". There are no similar limitations on the power of review conferred on the AAT by the AAT Act. Under section 27 of that Act an application for review may be made by any person whose interests are affected by the decision sought to be reviewed. On review the AAT, by section 43 is authorised to exercise all the powers and discretions that are conferred on the person who made the decision and shall make a decision in writing: "(a) affirming the decision under review; (b) varying the decision under review; or (c) setting aside the decision under review and: (i) making a decision in substitution for the decision so set aside, or (ii) remitting the matter for reconsideration in accordance with any directions or recommendations of the Tribunal." The simplicity of section 43 of the AAT Act can be contrasted with the difficulties and complexities of section 37 of the Resolution of Complaints Act. 6. The issue before the Tribunal It will be recalled that the issue before the Tribunal was whether Mrs Bishop was entitled to an insured benefit. Under Rule 8.1 this was dependant upon whether she died whilst "in the Service of the Employer prior to the Normal Retirement Date". Mrs Bishop had been employed on a casual basis but had not worked for some seven months prior to her death on 13 September 1994. Mrs Bishop had commenced employment with Axiom Advertising Pty Ltd trading as Sanctuary Cove Fruit and Vegetable Trading Co Pty Ltd on 31 July 1992. There is no material before the Tribunal relating to her conditions of employment or the award or determination under which she was employed. She joined CARE in August 1993 and made voluntary contributions of $10.00 per pay period which was deducted from her wages and paid to CARE. Her employer made contributions to CARE including arrears for the period July 1992 to August 1993. The total contributions made, including interest, was $545.54. This has been paid to Mr Bishop. The last occasion on which a contribution by Mrs Bishop was recorded was about 15 March 1994. She was ill and unable to work after 3 February 1994. She died on 13 September 1994. Mr Bishop made a claim on the Trustee for the insured benefit. The Trustee referred the claim to the Insurer for comment. On 14 March 1995 the Insurer advised the Trustee that the insured benefit was not payable under the policy since the member (Mrs Bishop) had died outside the period of extended cover i.e. 60 days after ceasing work. On 28 March 1995, the Trustee made a decision to accept the view of the Insurer and refused the claim for payment of the insured benefit to Mr Bishop. On 30 June 1995 Mr Bishop, through his solicitor, made a complaint under section 14 of the Resolution of Complaints Act on the basis that the death benefit ought to be paid. The Tribunal made its determination on 20 March 1996 and at the same time published its reasons for determination. As stated, correctly, the central issue on the review was whether the insured benefit was payable under Rule 8.1 of CARE. The Trustee contended that Rule 8.1 did not apply because Mrs Bishop was not in the service of her employer at the time of her death. In order to determine this issue, the Tribunal referred to a number of definitions contained in Rule 1. Rule 8.1 provides that if a member dies whilst the member is in the service of the employer, the member's insured benefit is payable. The word "member" is defined to mean an employee who has been admitted as a member of CARE. Here, there is no doubt that Mrs Bishop was a member of CARE. "Employee" is defined to mean a person who is classified by an employer as being in the service of the employer for the purposes of CARE. The meaning to be given to the word "Service" is important and is set out in full:- ""Service" means continuous service with an Employer and for the purposes of this definition an Employee's service shall not cease to be continuous by reason only of: (a) a transfer from the service of one Employer to the service of another Employer PROVIDED THAT the Member makes the election referred to in sub-clause 18.4; or (b) the Employee's temporary absence from the service of the Employer - (i) while the employee is engaged in compulsory military service or in service in the armed forces of Australia or its allies in time of war; or (ii) in any other circumstances which for the purposes of the Plan the Employer regards as not resulting in a break in the continuity of the Employee's service, and "Service of the Employer" shall have a corresponding meaning." It is to be observed that service means "continuous service" but service remains continuous notwithstanding specific occurrences. The occurrences specified in (a) and (b)(i) can have no application. In this case, Mr Bishop contended, and this appears to have been accepted by the Tribunal, that the occurrence specified in (b)(ii) results in there being no break in the continuity of Mrs Bishop's service. Difficult questions arise from the fact that Mrs Bishop was employed as a casual worker. There was no material before the Tribunal and the Tribunal makes no reference to any such material, as to the nature of the employment of a person as a casual. There was no material as to her conditions of employment. Normally a casual employee is not entitled to holiday pay, to sick leave, or to payment in lieu thereof. Normally a casual employee is paid for the casual periods actually worked. There may be limits on the number of hours a casual is able to work for any one employer in any regular period, but again there was no material before the Tribunal on this aspect. The facts show that Mrs Bishop last worked on 3 February 1994 and the last payment of contribution from her was with respect to the amount deducted by her employer in February 1994. Her employer had made no employer contributions since February 1994. For all practical purposes she ceased being an employee in the service of her employer in February 1994. On 4 June 1995, a director of the company which had been the employer of Mrs Bishop made a statutory declaration which included the following paragraphs: "2. KATRINA JOY BISHOP commenced employment with the company on the 31st day of July 1992 on a casual basis. 3. KATRINA JOY BISHOP continued in the employ of the company from that time until the date of her death, namely the 13th September 1994. 4. Notwithstanding that she was employed by the company from the 31st day of July 1992 until the date of her death, she was on leave from the company solely for medical reasons. She contracted cancer and as a result was unable to return to her normal duties at her place of employment, although, it was made clear to KATRINA JOY BISHOP that she could return to work immediately she recovered from her illness. 5. KATRINA JOY BISHOP died on the 13th September, 1994 and had not had the opportunity to return to her place of employment to physically carry out her work for the company, however, remained in the service of the company up until the date of her death. She did not resign from her employment, was never dismissed and remained in the service of the company until her death. 6. On the last day that KATRINA JOY BISHOP physically attended at the workplace to carry out her tasks in her capacity as an employee of the company was the 3rd day of February, 1994." In its reasons, the Tribunal said:- "The Deceased was employed on a casual basis and had not worked for over 7 months prior to her death. The Complainant and the Employer claim that she was on leave without pay during this period. However, the Trustee submitted that she was not continuously employed. While this might be an accurate reflection of her employment status under employment law or the relevant award, as casuals cannot go on leave without pay, it is important to note that the definition of 'Service' in the Trust Deed can override these other bases for assessing whether or not she was still in Service at the date of her death. The Tribunal therefore rejects the following Trustee's statement: It is submitted that in order to satisfy the element of continuity, it must be established that the deceased member was engaged in regular remunerative employment activity as at the date of her death. The Tribunal is of the view that this submission does not reflect the extended definition of Service in the Trust Deed, where certain situations are deemed not to constitute a break in employment. In particular, sub-rule (b)(ii) requires consideration. In order to qualify under this sub-rule, it is necessary that the Deceased's absence from work due to sickness was a 'temporary absence'. The Trustee has correctly pointed out that the absence was in fact permanent, as she died before returning to work. However, the Tribunal accepts the evidence of both the Employer and the Complainant that it was intended that the Deceased's absence be only temporary and that she would return to work when she had fully recovered, as was expected. Further, there is no medical evidence to suggest that the Deceased was aware that she would not be well enough to resume her normal duties. Sub-rule (b)(ii) of the definition of Service in the Trust Deed is the section which governs the impact on 'Service' of leave without pay, such as parental leave. The Employer gave clear evidence that it regarded the Deceased's absence as not resulting in a break in the continuity of her service. The Trustee submitted that it did not accept the Employer's assertions and that the sub-rule required an objective assessment of the employment relationship. However, the Tribunal if of the opinion that the Employer's view was reasonably formed in the circumstances and was the clear point of reference under the terms of the Trust Deed. (The Tribunal notes, however, that the responsibility of the Employer under this sub-rule may well have altered since the Fund became regulated, but virtue of the impact of section 58 of the Superannuation Industry (Supervision) Act restricting the ability of a trustee to be subject to direction. However, this was not relevant at the date of the Deceased's death.) The Trustee also submitted that sub-rule (b)(ii) was not intended to apply to members of the Fund who were employed on a casual basis. However, no distinction between casual and part-time employment appears in Rule 8.1 or the definition of Service. As far as the Tribunal is aware, only Rule 13 distinguishes between part-time and casual employment and this Rule does not relate to benefits but only to the adjustment of contributions ....... The Tribunal finds that the Deceased died while in Service. Therefore, Rule 8.1 applies and the Deceased's accumulated benefit and the 'Insured Benefit (if any)' is payable." Having reached this conclusion, the Tribunal turned to consider the terms of the insurance policy provided by the Insurer. This involved a combination of the application of the policy to a part time employee as meaning an employee who works for a participating employer for a certain number of hours each and every week. The Tribunal held that Mrs Bishop was a part-time employee even though there was no material before it to support such a finding. 7. The appeal on question of law The Trustee and the Insurer appealed from the determination of the Tribunal. The essential question of law raised was whether on the proper construction of Rule 8.1 of the Rules of CARE and on all the material before it, was it open to the Tribunal to form the conclusion that it did. The question was stated in a number of different ways but all the formulations come down to this question or to whether there was material before the Tribunal to support the conclusion that Mrs Bishop was a part time employee. Clause 6 of the relevant insurance policy provided that the insured benefit payable on death ceased to be payable at the expiry of a period of 60 days after leaving the service of a participating employer; clause 6(c). The phrase "leaving the service" is not defined, but the Tribunal referred to the following definitions and concluded:- " "Member" means an employee of a Participating Employer accepted by (the Insurer) for a benefit. "Employee" means an employee of a Participating Employer and includes "Part-time Employees". A "Part-time Employee" means an Employee who works for a Participating Employer for a certain number of hours each and every week. The Tribunal is of the view that the Deceased fell within this extended definition of Part-time Employee and, as such, was still a Member and did not leave the Employer's service on her last day of work for the purposes of the Policy. The Tribunal is therefore of the view that the Deceased had not ceased to qualify for insured benefits under the Policy." There was no material before the Tribunal relating to the number of hours each and every week that Mrs Bishop worked. At the hearing of the appeal submissions were made directed to whether the Tribunal had made the error of law described in the notice of appeal. This involved difficult questions arising from the opinions expressed by the High Court as to the difference of function of an administrative tribunal and the function of a court hearing an appeal on a question of law not becoming involved in the exercise of the discretion conferred upon the administrative tribunal. In this respect reference may be made to Repatriation Commission v Owens (1996) 70 ALJR 904, Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 per Brennan CJ, Toohey, McHugh and Gummow JJ at 272 and Minister for Immigration and Ethnic Affairs v Guo 13 June 1997 unreported especially per Kirby J in the passages of judgment under the headings "Addressing the correct legal question" and "The proper relief". The Court reserved it's judgment. On the following day, the Court raised by correspondence to the parties, whether the Tribunal had purported to exercise judicial powers in making its determination. Subsequently, the appeal was listed for a further hearing at which the members of the Tribunal were added as parties and represented by counsel. The issue was the nature of the power conferred on the Tribunal. 8. Did the Tribunal exercise a judicial power The Court, as presently constituted, considered a similar question in W. E. Bassett & Partners Pty Ltd v Doherty and opinions expressed in that judgment have equal application here. There are many authorities bearing on the issue but it is not necessary to repeat them here. The principles to be applied are stated clearly in Precision Data Holdings Ltd v Wills (1991) 173 CLR 167 at 188-190:- "The acknowledged difficulty, if not impossibility, of framing a definition of judicial power that is at once exclusive and exhaustive arises from the circumstance that many positive features which are essential to the exercise of the power are not by themselves conclusive of it. Thus, although the finding of facts and the making of value judgments, even the formation of an opinion as to the legal rights and obligations of parties, are common ingredients in the exercise of judicial power, they may also be elements in the exercise of administrative and legislative power. Again, functions which are ordinary ingredients in the exercise of administrative or legislative power can, in some circumstances, be elements in the exercise of what is truly judicial power. It follows that functions may be classified as either judicial or administrative according to the way in which they are to be exercised. So, if the ultimate decision may be determined not merely by the application of legal principles to ascertained facts but by considerations of policy also, then the determination does not proceed from an exercise of judicial power. That is not to suggest that considerations of policy do not play a role, sometimes a decisive role, in the shaping of legal principles. Furthermore, if the object of the adjudication is not to resolve a dispute about the existing rights and obligations of the parties by determining what those rights and obligations are but to determine what legal rights and obligations should be created, then the function stands outside the realm of judicial power. In Re Ranger Uranium Mines (1987) 163 CLR 656 the Court said: "The power of inquiry and determination is a power which properly takes its legal character from the purpose for which it is undertaken. Thus inquiry into and determination of matters in issue is a judicial function if its object is the ascertainment of legal rights and obligations. But if its object is to ascertain what rights and obligations should exist, it is properly characterized as an arbitral function when performed by a body charged with the resolution of disputes by arbitration." The Court was then speaking with reference to an arbitral function of the Conciliation and Arbitration Commission but, as the judgment shows, the remarks apply with equal force to determinations made for administrative, executive or legislative purposes." A summary of the legislative provisions relating to the Tribunal is given in Doherty and need not be repeated here. The comparison between the Tribunal and the AAT under the AAT Act need not be repeated. It is clear that the Tribunal is an administrative body. In the course of hearing reviews of decisions of trustees, or insurers, under the powers conferred upon it by the Resolution of Complaints Act, the Tribunal will, of necessity, be required to form conclusions on questions of law and apply those conclusions to facts found on the material before the Tribunal. Normally, this would form but a step in the administrative powers of determining future rights and obligations. This was said in Re Ranger Uranium Mines in relation to an arbitral function, but the principle has equal application to an administrative function. Thus inquiry into and determination of matters in issue is a judicial function if its object is the ascertainment of legal rights and obligations but if its object is to ascertain what rights and obligations should exist, it is properly characterized as an administrative function. The difficulty in the present case is to ascertain the purpose by which the review was undertaken. In the present case, the difficulties involve the proper construction of subsection 14(2) and section 37 of the Resolution of Complaints Act. The Tribunal is not empowered to review any decision of the trustee of a superannuation fund on a complaint by any person affected by the decision. The review is limited by subsection 14(2) to those cases where "the decision is or was unfair or unreasonable". Even though the Tribunal, in determining the review, "has all the powers, obligations and discretions that are conferred on the trustee"; paragraph 37(1)(a), those powers are limited by other provisions of section 37. Thus, under subsection 37(6) the Tribunal must affirm the decision of the trustee if it is satisfied that the decision, in its operation in relation to the complaint, "was fair and reasonable in the circumstances". If the Tribunal is not so satisfied, its powers are limited by subsection 37(4) to making a determination "for placing the complainant as nearly as practicable in such a position that the unfairness, unreasonableness, or both, that the Tribunal has determined to exist in relation to the trustee's decision that is the subject of the complaint no longer exists". At the same time the Tribunal is required by subsection 37(5) to observe the law in that it must not make any determination that would be contrary to law, to the rules of the fund concerned, any relevant contract of insurance between the trustee and the insurer and to the terms of the contract. In the context of these provisions, counsel for the Trustee and the Insurer, submitted that the words in subsection 14(2) "that the decision is or was unfair or unreasonable" must have some meaning and should be construed as limiting the right of a member or other persons to make a complaint to those decisions which involve the exercise of a discretion of the trustee or insurer. Counsel referred to some of the many legal authorities which restrict the right to challenge in legal proceedings, the exercise of a discretion of a trustee. Illustrations were given:- "Where a trustee exercises a discretion, it may be impugned on a number of different bases such as that it was exercised in bad faith, arbitrarily, capriciously (Re Pauling's Settlement Trusts [1964] Ch 303 at p. 333), wantonly, irresponsibly (Lutheran Church of Australia South Australian District Incorporated v Farmers' Co-Operative Executor and Trustees Ltd. (1970) 121 C.L.R. 628 at p.639), mischievously or irrelevantly to any sensible expectation of the settlor (Re Manisty's Settlement [1974] Ch 17), or without giving a real and genuine consideration to the exercise of the discretion (Karger v Paul [1984] V.R. 161, which includes a survey of the authorities). The exercise of a discretion by trustees cannot of course be impugned upon the basis that their decision was unfair or unreasonable (see Dundee General Hospital's Board of Management v Walker [1952] 1 All ER 896) or unwise (Gisborne v Gisborne (1877) 2 AC 300 at p.307). Where a discretion is expressed to be absolute it may be that bad faith needs to be shown (Gisborne v Gisborne supra at p.305). The soundness of the exercise of a discretion can be examined where reasons have been given, but the test is not fairness or reasonableness (see Re Londonderry's Settlement [1965] Ch. 918 at pp 928-9; Karger v Paul at pp 165-6." Counsel contended that section 14 and 37 of the Resolution of Complaints Act were designed to enable the Tribunal to review the exercise of a discretion by a trustee, or insurer, under a superannuation fund and, subject to the restrictions imposed by section 37, to substitute the exercise of its discretion for that of the trustee or the insurer. Counsel for Mr Bishop and counsel for the members of the Tribunal disputed these submissions. They contended that in the context of cases like the present, the expression 'administrative character' or 'administrative function' should not be construed narrowly but be given a wide connotation. This contention is accepted. Similarly, it is accepted that the mere fact that the Tribunal has to consider the legality of a decision by a trustee, does not by itself, mean that the Tribunal is exercising a judicial function. This is made clear by a reference to Precision Data Holdings and also by reference to the functions of the AAT. The essence of the submission by counsel for Mr Bishop and by counsel for the members of the Tribunal was that if in law the trustee had made an error of law in arriving at its decision then, of necessity, the decision of the trustee was, as a matter of ordinary and common English usage both unfair and unreasonable. In my opinion, these submissions should not be accepted. Some meaning must be given to the words 'unfair or unreasonable' in subsection 14(2). This conclusion is supported by the limitations and restrictions contained in section 37. All these restrictions can be contrasted with the wider and almost unlimited powers conferred upon the AAT under the AAT Act. This conclusion is supported by a reference to the difficulties facing a member of a superannuation fund attempting to challenge the exercise of discretion of a trustee by proceedings in a court. The use of the words 'unjust or unreasonable' in subsection 14 of the Resolution of Complaints Act must be given the meaning that a person may make a complaint if, and only if, the decision the subject of the complaint, contains some discretionary element. In the present case, there appears to be no suggestion that the decisions of the trustee and the insurer sought to be made the subject of the complaint involved any exercise of discretion by the trustee or insurer. The decision the subject of the complaint is the decision of the trustee that on the facts before the trustee, Mr Bishop is not entitled to an insurance benefit under Rule 8.1. There was no complaint that the decision of the trustee was unfair or unreasonable. The decision was based upon the wording of the rule and definitions contained in the Rules to the relevant facts. 9. Conclusion From a consideration of the reasons for determination published by the Tribunal, the Court concludes that in making its determination, the Tribunal purported to exercise judicial powers only not administrative powers. It's determination was based upon the application of legal principles being the construction of the provisions of the Rules of CARE to facts found. The reasons of the Tribunal made this very clear. They set out the decision of the trustee denying the claim by Mr Bishop. The reasons state the reasons given by the trustee as:_ "(a) the members (sic) death did not occur in circumstances which satisfied the requirements of the rules governing the administration of the Plan for the payment of an insurer (sic) benefit on the member's death; and (b) the members (sic) death did not occur in circumstances which came within the insurance arrangements for the payment of a benefit on the member's death." The reasons state that the main issue arising on the complaint was the non-payment of the insured benefit and that the Trustee had wrongly refused to pay the death benefit. The reasons then considered the complaint in the manner described earlier in these reasons. The ultimate conclusion was stated:- "The Tribunal is of the opinion that Insured Benefits are payable in respect of the Deceased under both the terms of the Trust Deed and the Policy." The determination made by the Tribunal is set out earlier in these reasons. It is based on paragraph 37(3)(d) of the Resolution of Complaints Act. In its reasons, the Tribunal did not consider the proper construction and application of the words 'that the decision is or was unfair or unreasonable' appearing in subsection 14(2) of the Resolution of Complaints Act. It did not consider whether the decision involved any and what exercise of discretion by the Trustee or the Insurer. It did not consider the proper construction and application of subsections 37(6) and 37(4) of the Resolution of Complaints Act. It made no reference to the constraints imposed by subsection 37(5). These provisions seem to support the view that the relevant law is to be applied and that concepts of what is fair and reasonable in the circumstances apply where, within the relevant law, a trustee, insurer or other decision-maker has a discretion of some kind with respect to a decision to be made. In the present case, such a discretion could arise under Rule 9. In the present case, the complaint may not be a complaint within section 14 of the Resolution of Complaints Act. The Tribunal considered the construction and application of the relevant terms of the Trust Deed and the Policy and applied the law so found to the facts ascertained it. It declared the right of Mr Bishop to the member's Insured Benefit under Rule 8.1 and directed the Trustee and Insurer to calculate the amount of the Insured Benefit and to pay it without further delay "in accordance with the Trust Deed and the Insurance Policy". The determination of the Tribunal should be set aside on the basis that it was the result of the exercise of a judicial power. Further, the determination should be set aside on the basis that the Tribunal had made an error of law as set out earlier in these reasons. As was said in Bassett v Doherty, the Court is aware of the judgment in Briffa v Hay (20 June 1997, unreported) but declines to follow the reasoning in that judgment. The facts of the present case raise starkly the difficulties in construing and applying sections 14 and 37 of the Resolution of Complaints Act. Those difficulties need to be considered by the Parliament. In the result the appeal is allowed with costs. The determination of the Tribunal is set aside and the complaint remitted to the Tribunal for determination according to law after receiving such further material as it considers appropriate. The members of the Tribunal appeared and were made parties to assist the Court. The order for costs should not apply with respect to them nor should they be ordered to pay the costs of the other parties. I certify that this and the preceding twenty-six (26) pages are a true copy of the Reasons for Judgment of the Honourable Justice R M Northrop. Associate: Date:

Precision Data Holdings Ltd v Wills

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