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[2009] FCA 472
Federal Court of Australia
2009-05-12
Besanko J
Original judgment source is linked above.
REASONS FOR JUDGMENT 1 Mr Kenneth John Sleep appeals to this Court from two decisions made by the Administrative Appeals Tribunal. Both decisions were made on 10 December 2008. 2 In Sleep v Repatriation Commission [2008] AATA 1100, the Tribunal made the following decision: "The Repatriation Commission decision of 5 July 2004, as affirmed by a review officer on 10 August 2007, which reduced Mr Sleep's rate of service pension with effect from 20 July 2004 in reflection of an assets test which included the value of property at $140,000, is affirmed." 3 In Sleep v Repatriation Commission [2008] AATA 1101, the Tribunal made the following decision: "The decision of the Repatriation Commissioner dated 13 August 2007, as affirmed by a decision of a review officer dated 19 March 2008, which reduced Mr Sleep's rate of pension from 26 August 2007, is affirmed." 4 A party to a proceeding before the Tribunal may appeal on a question of law from any decision of the Tribunal in that proceeding: Administrative Appeals Tribunal Act 1975 (Cth) s 44(1). 5 The appeals were heard together, and each party made one set of written submissions in relation to both appeals. In substance, the applicant's submissions were common to both appeals. 6 Sleep v Repatriation Commission [2008] AATA 1101 became Action Number SAD 212 of 2008 in this Court, and Sleep v Repatriation Commission [2008] AATA 1100 became Action Number SAD 213 of 2008. It is convenient to deal with the appeal in SAD 212 of 2008 first.
SAD 212 of 2008 7 At all material times, the applicant was in receipt of a service pension under Part III of the Veterans' Entitlements Act 1986 (Cth) ("the Act") and his wife was in receipt of a partner service pension. The applicant was also in receipt of the pension under Part II, paid at the special rate. 8 The applicant turned 60 years of age on 26 August 2007. On that day, he held three superannuation products. It is not necessary to set out the details of those products. The pension age for men under the Act is 60 years: s 5QA(2). Superannuation products are to be disregarded in calculating the value of a person's assets for the purposes of the service pension and partner service pension before the person reaches 60 years of age. The decision of the respondent challenged on this appeal was to apply the assets test with effect from 26 August 2007 and to include in the applicant's assets superannuation products which he held on 26 August 2007. On 7 September 2007, the applicant advised the respondent that his superannuation balance at that time was nil, and in response to that advice, the respondent, with effect from 7 September 2007, disregarded the value of the applicant's superannuation products. The respondent's decision of which the applicant complained had the effect of reducing the applicant's service pension and the partner service pension between 26 August 2007 and 7 September 2007. 9 The applicant appeared in person and he put four submissions in support of his appeal. They may be summarised as follows: 1. The respondent had acted in a manner which was unconscionable and in breach of a fiduciary duty which it owed to the applicant. 2. The reduction of the applicant's service pension and the partner service pension was an acquisition of property from him other than on just terms. The applicant referred to s 51(xxxi) of the Constitution. 3. The applicant's pension entitlement was personal property within s 52(1)(k) of the Act and it was designed for use by him, as he is a disabled person. The applicant submitted that the value of his pension entitlement should be disregarded in calculating the value of his assets and that the effect of s 52(1)(k) was that the assets test did not apply to the applicant's pension entitlement. 4. The effect of the respondent's decision was that the applicant's service pension and his wife's partner service pension were reduced. However, the applicant's pension paid at the special rate remained the same. The applicant submitted that this was an incongruous result, bearing in mind that the same conditions gave rise both to his eligibility for the service pension and his wife's partner service pension, and his eligibility for the pension paid at the special rate. 10 The first two submissions can be dealt with briefly. 11 With respect to the first submission, the applicant's complaints about the way he has been dealt with are not within the scope of the appeal to this Court, that is, an appeal on a question of law from a decision of the Tribunal. 12 With respect to the second submission, no claim was made (it seems) to the Tribunal that the reduction of the applicant's pension and his wife's partner service pension were in some way contrary to the Constitution. In any event, the submission appears to have no merit and, in the circumstances, must be rejected. 13 Before considering the third and fourth submissions, it is convenient to summarise the provisions of the Act which deal with a service pension (and a partner service pension) on the one hand, and the pension paid at the special rate on the other. 14 The starting point in relation to the pension paid at the special rate is s 24 of the Act. Two requirements (among others) for such a pension are stated in s 24(1) as follows: "(b) the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and (c) the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity;" 15 Section 13 deals with eligibility for the pension and refers to, relevantly for present purposes, "a veteran [who] is incapacitated from a war-caused injury or war-caused disease". Section 9 deals with war-caused injuries and war-caused diseases. 16 Section 24(4) specifies the amount of the pension which is payable to a veteran to whom the section applies. As s 24 specifies the amount of the pension, it does not require or permit reference to the veteran's assets. Section 24(4) at the relevant time provided as follows: "(4) Subject to subsections (5) and (6), the rate at which pension is payable to a veteran to whom this section applies is $919.40 per fortnight." 17 Part III of the Act deals with service pensions and s 37 deals with a person's eligibility for an invalidity service pension. The term "service pension" is defined in s 5Q of the Act as meaning: "(a) an age service pension; or (b) an invalidity service pension; or (c) a partner service pension." 18 Section 37(1) of the Act provides: "Subject to subsection (6), a person is eligible for an invalidity service pension if the person: (a) is a veteran; and (b) has rendered qualifying service; and (c) is permanently incapacitated for work in accordance with a determination under section 37AA." 19 Section 37AA places on the respondent a duty, by written determination, to specify the circumstances in which persons are permanently incapacitated for work for the purposes of s 37(1(c). 20 From 1 January 2000, the Veterans' Entitlements (Invalidity Service Pension - Permanent Incapacity for Work) Determination 1999 (Cth) ("the Determination") sets out the circumstances in which a person is "permanently incapacitated for work" for the purposes of s 37(1)(c). Those circumstances are where the person is: 1. permanently blind in both eyes; or 2. is a veteran to whom s 24 of the Act applies; or 3. satisfies s 5(2) of the Determination (which is not relevant on the present applications). 21 In this case, the applicant is eligible for the invalidity service pension because he is a veteran to whom s 24 of the Act applies. 22 Section 37N provides for the calculation of a veteran's invalidity service pension and it states that the rate is worked out in accordance with the Rate Calculator. The Rate Calculator is defined in s 5Q of the Act as the rate calculator in Part 2 of Schedule 6. Part 2 Module A provides a Method statement 1 which requires the application of the assets test used under Module F. Module F Step 1 provides that the calculation is to be worked out by first calculating the value of the person's assets, and one of the notes provides that reference is to be made to s 52 of the Act for assets to be disregarded. Section 52 of the Act provides, relevantly, as follows: "(1) In calculating the value of a person's assets for the purposes of this Act (other than sections 52G, 52H, 52JA, 52JB, 52JC, 52JD, 52ZA and 52ZCA), disregard the following: … (f) the value of the person's investment in: (i) a superannuation fund; or (ii) an approved deposit fund; or (iii) a deferred annuity; or (iiia) an ATO small superannuation account; until the person: (iv) reaches pension age; or (v) commences to receive a pension or annuity out of the fund;
Note: Some investments in superannuation funds, approved deposit funds, deferred annuities and ATO small superannuation accounts may be disregarded - see section 52AA. … (k) if: (i) personal property of the person is designed for use by a disabled person; and (ii) the person, the person's partner or a child who is dependent on the person or the person's partner is disabled; the value of the property; (l) if: (i) personal property of the person is modified so that it can be used by a disabled person; and (ii) the person, the person's partner or a child who is dependent on the person or the person's partner is disabled; the part of the value of the property that is attributable to the modifications;" 23 With respect to the applicant's third submission, his superannuation products are assets and are to be taken into account in determining the rate of the invalidity service pension and partner service pension, unless the circumstances fall within s 52(1)(f) of the Act. The Tribunal correctly determined that, once the applicant turned 60 years of age, they did not. In light of the clear provisions of the Act, there is no substance in the applicant's submission that in some way s 52(1)(k) evinces an intention to exclude the assets test from the calculation of an invalidity service pension and partner service pension. 24 With respect to the fourth submission, the submission must be rejected. Section 24(4) of the Act specifies the amount of pension paid at the special rate. By contrast, the rates of the service pension and partner service pension are to be calculated by the application of other provisions of the Act. Whether, as the applicant submitted, the link between the pension paid at the special rate and the service pension in the case of the applicant (see [21]) means that the result of the Tribunal's decision is incongruous is not to the point. The result reached by the Tribunal is the result dictated by the clear words of the Act. 25 In my opinion, even if the applicant's third and fourth submissions are questions of law they are, for the reasons I have given, without merit. The appeal in SAD 212 of 2008 must be dismissed.
SAD 213 of 2008 26 The decision under challenge in this appeal is the decision of the Tribunal affirming the respondent's decision made on 5 July 2004 to apply an assets test to the applicant's invalidity service pension and his wife's partner service pension, and to include in the applicant's assets a property situated at Port Road, Croydon, and, for the purposes of the assets test, to ascribe a value of $140,000 to that property. 27 As I have said, on this appeal the applicant, in substance, made the same submissions as he made in SAD 212 of 2008. Those submissions must be rejected for the reasons I have given in that appeal. In addition, it is clear that the property at Croydon is a real property and cannot fall within the terms of s 52(1)(k) or (l) of the Act. Furthermore, there is nothing to suggest that the Tribunal member erred in concluding that he could not be satisfied that the property was either "designed for use by a disabled person" within s 52(1)(k) or "modified so that it can be used by a disabled person" within s 52(1)(l). 28 The appeal in SAD 213 of 2008 must be dismissed. I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Besanko.
Associate: Dated: 12 May 2009 The Applicant appeared in person
Counsel for the Respondent: Ms S J Maharaj QC with Mr A Schatz
Solicitor for the Respondent: Australian Government Solicitor
Sleep
Repatriation Commission
[2008] AATA 1100
[2008] AATA 1101