FEDERAL COURT OF AUSTRALIA

CONSTITUTIONAL LAW - Superannuation Complaints Tribunal - review of decision of trustee of superannuation fund - whether exercise of judicial power

Constitution Ch III

Wilkinson & Ors v Clerical Administrative and Related Employees Superannuation Pty Ltd & Ors VG 459 of 1997  applied 12 February 1998

DANIEL NATHAN BRECKLER & ORS v SHIRLEY LESHEM

WAG 60 OF 1997

JUDGES:       LOCKHART, HEEREY and SUNDBERG JJ

DATE:            12 FEBRUARY 1998

PLACE:          MELBOURNE

On Appeal from the Superannuation Complaints Tribunal constituted by Christine Heazlewood, Tony Tuohey and Robert Drake

THE COURT ORDERS THAT:

1.         Answer the question:

Is s 37 of the Superannuation (Resolution of Complaints) Act1993, or any part thereof, invalid in that it purports to confer the judicial power of the Commonwealth on the Tribunal and is therefore inconsistent with Chapter III of the Constitution?

Yes, wholly.

2.         Order:

            (a)        that the decision of the Superannuation Complaints Tribunal constituted by Christine Heazlewood, Tony Tuohey and Robert Drake given on 2 May 1997 at Melbourne whereby the Tribunal decided to set aside a decision of the then trustee the Cecil Bros Pty Ltd Superannuation Plan in relation to the death benefit payable following the death of Cecil Breckler and to substitute its own decision be set aside.

            (b)        that the trustees’ decision made on 16 August 1994 and affirmed by them on 2 February 1995 be affirmed.

            (c)        that the respondent pay the appellants’ costs of the appeal and the proceeding at first instance.

Note:                Settlement and entry of orders is dealt with in order 36 of the federal court rules.

On Appeal from the Superannuation Complaints Tribunal constituted by Christine Heazlewood, Tony Tuohey and Robert Drake

REASONS FOR JUDGMENT

LOCKHART J

I have had the advantage of reading the reasons for judgment of Heerey J in draft form.  I agree with his Honour’s reasons and the orders which he proposes.

Associate:

Dated:              12 February 1998

On Appeal from the Superannuation Complaints Tribunal constituted by Christine Heazlewood, Tony Tuohey and Robert Drake

REASONS FOR JUDGMENT

HEEREY J:

This matter comes to the Full Court by way of a question reserved by French J under s 25(6) of the Federal Court of Australia Act 1926 (Cth).

The question was in these terms:

1.         Cecil Breckler (“CB”) was a member of the Cecil Bros Pty Ltd Superannuation Plan (“the Fund”).  Following his death on 1 August 1994 the Trustees determined that a benefit be paid.  Whether or not it was a death benefit is in issue.  On 16 August 1994 the then Trustees of the Fund decided to distribute the benefit so that 17 percent was paid to the Respondent and 83 percent was paid to CB’s legal personal representative.

2.         The decision was reviewed by the Trustees and affirmed on 2 February 1995 after the Trustees had called for submissions from the Respondent and determined that she had not demonstrated any special need.

3.         On 19 September 1995 the Respondent lodged a complaint with the Superannuation Complaints Tribunal (“the Tribunal”) purportedly under s 14 of the Superannuation (Resolution of Complaints) Act 1993 (“the SRC Act”).  The Tribunal considered the complaint at a meeting held on 13 February 1997.  On that day, purporting to act under s 37 of the SRC Act, the Tribunal decided to set aside the decision of the Trustees and substitute its decision that 50 percent of the death benefit be paid to the Respondent and 50 percent of CB’s legal personal representative imposing a requirement on the Appellants to pay an additional $87,128.79 to the Respondent on account of the entitlement of Cecil Breckler notwithstanding that the full entitlement of Cecil Breckler had previously been paid.  The determination was based on findings that the Plan was a defined benefit plan and that the employer was obliged to make up any shortfall under the Plan deed, so that arguments of change of position by recipients of the entitlement of Cecil Breckler were irrelevant.  The decision was reflected in the Tribunal’s Determination No. D97/55, dated 2 May 1997.

4.         The Trustees appeal to this Court under s.46 of the SRC Act from the decision of the Tribunal.

5.         The following question is reserved for the consideration of the Full Court:

            Is s.37 of the SRC Act, or any part thereof, invalid in that it purports to confer the judicial power of the Commonwealth on the Tribunal and is therefore inconsistent with Chapter III of the Constitution?

This matter was heard at the same time as Wilkinson & Ors v Clerical Administrative and Related Employees Superannuation Pty Ltd & Ors  VG 459 of 1997.

For the reasons stated in my judgment in Wilkinson, the question reserved should be answered:

            Yes, wholly.

It should be further ordered:

(a)        that the decision of the Superannuation Complaints Tribunal constituted by Christine Heazlewood, Tony Tuohey and Robert Drake given on 2 May 1997 at Melbourne whereby the Tribunal decided to set aside a decision of the then trustees of the Cecil Bros Pty Ltd Superannuation Plan in relation to the death benefit payable following the death of Cecil Breckler and to substitute its own decision be set aside.

(b)        that the trustees’ decision made on 16 August 1994 and affirmed by them on 2 February 1995 be affirmed.

(c)        that the respondent pay the appellants’ costs of the appeal and the proceeding at first instance.

Associate:

Dated:              12 February 1998

REASONS FOR JUDGMENT

SUNDBERG J

French J stated a case under s 25(6) of the Federal Court of Australia Act 1976 in which he reserved the following question for the consideration of the Full Court: “Is s 37 of the Superannuation (Resolution of Complaints) Act 1993, or any part thereof, invalid in that it purports to confer the judicial power of the Commonwealth on the Superannuation Complaints Tribunal and is therefore inconsistent with Chapter III of the Constitution?”

The matter was heard together with Wilkinson v Clerical Administrative and Related Employees Superannuation Pty Ltd (VG 459 of 1997).  For the reasons given in my judgment in that case, I would answer the question reserved: “No”.  The appellants should pay the respondent’s costs.

Associate:

Dated:              12 February 1998