FEDERAL COURT OF AUSTRALIA

Keeley v Repatriation Commission [1999] FCA 1103

DEFENCE AND WAR – veterans’ entitlements – widow’s claim – Statements of Principles – SoP applicable at time of Repatriation Commission decision subsequently revoked – new SoP in force at time of Administrative Appeals Tribunal review – whether first or second SoP applicable

STATUTES – operation and effect of statutes – repeal of Statement of Principles under Veterans’ Entitlement Act 1986 (Cth) – whether rights accrued under repealed SoP – whether contrary intention shown

Veterans’ Entitlements Act 1986 (Cth) ss 120(3), 120A(3)

Acts Interpretation Act 1901 (Cth) s 50

Byrnes v Repatriation Commission (1993) 177 CLR 564 applied

Repatriation Commission v Deledio (1998) 83 FCR 82 applied

Rodway v The Queen (1990) 169 CLR 515 mentioned

Ogston v Repatriation Commission (1999) 29 AAR 89 distinguished

Esber v Commonwealth (1992) 174 CLR 430 applied

J R Exports Pty Ltd v Australian Trade Commission (1987) 14 FCR 161 applied

Lee v Secretary, Department of Social Security (1996) 68 FCR 491 applied

Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651 mentioned

KEELEY v REPATRIATION COMMISSION

T5 OF 1999

HEEREY J

13 AUGUST 1999

MELBOURNE (HEARD IN HOBART)

THE COURT ORDERS THAT:

1.         The appeal be allowed.

2.         The decision under review be set aside.

3.         The matter be remitted to the Administrative Appeals Tribunal for further consideration according to law.

4.         The respondent pay the applicant’s costs of the appeal, including reserved costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

1                     The applicant is the widow of Kenneth John Keeley who served with the RAAF in the South West Pacific from 1941 to 1946.  When the applicant’s claim for pension in respect of the death of her husband was refused by the respondent Commission, and also when that decision was subsequently reviewed by the Veterans’ Review Board (VRB), the applicable Statement of Principle (SoP) would, arguably at least, have upheld a reasonable hypothesis connecting the veteran’s death with the circumstances of his operational service for the purposes of s 120(3) and 120A(3) and s 120(3) of the Veterans’ Entitlements Act 1986 (Cth) (VEA). 

2                     However by the time the applicant’s application for review was heard by the Administrative Appeals Tribunal (AAT), a second SoP had replaced the first one.  It was common ground that if the second SoP was applicable the applicant could not bring her case within it.

3                     The AAT held that the second SoP applied.  In effect this was treated by the AAT as a preliminary issue.  If this appeal succeeds and the matter is remitted to the AAT the Commission would wish to contest the factual basis of the applicant’s claim.

4                     This appeal raised the following question of law.  Is an AAT review of a decision of the Commission to be determined by reference to the SoP in force when the primary decision was made, or by reference to the SoP in force at the time of the AAT review?

The applicant’s case

5                     Mr Keeley died on 29 September 1986 as a result of multiple myeloma, a type of cancer.

6                     On 14 December 1994 the applicant lodged a claim for a widow’s pension under VEA Pt II.  Having been made after 1 June 1994, the claim was subject to the SoP regime:  s 120A(1)(a): Ogston v Repatriation Commission (1999) 29 AAR 89.  In the claim the veteran’s service cause or contribution was said to be “bowel trouble”.  At the time of his death he was receiving a sixty per cent service pension. 

7                     On 12 January 1995 the Repatriation Medical Authority (RMA) made Instrument No. 1 of 1995 (the first SoP) concerning multiple myeloma which relevantly stated:

“1.       Being of the view that there is sound medical-scientific evidence that indicates that multiple myeloma and death from multiple myeloma can be related to operational service rendered by veterans … the Repatriation Medical Authority determines, under subsection 196B(2) of the Veterans’ Entitlements Act 1986, that the factors that must as a minimum exist before it can be said that a reasonable hypothesis has been raised connecting multiple myeloma or death from multiple myeloma with circumstances of that service are: 

(a)        … or

(b)        being occupationally exposed to paints and/or lacquers before the clinical onset of multiple myeloma; or

(c)        … or

(d)        …

2.         … at least one of the factors set out in paragraphs 1(a) to (d) must be related to any service rendered by a person.” [emphasis in original]

8                     On 31 May 1995 a delegate of the Commission decided that the death of Mr Keeley was not causally related to his operational service.

9                     The applicant sought review by the VRB. The applicant, who was not legally represented, told the VRB that her husband had “suffered from anxiety with stomach trouble (functional dyspepsia), and that was the reason he developed cancer”.  On 19 April 1996 the VRB found that none of the factors in the first SoP applied in the case of Mr Keeley.

10                  On 20 June 1996 the applicant lodged an application for review by the AAT.  

11                  On 26 September 1996 the RMA made Instrument No. 134 of 1996 (the second SoP) concerning multiple myeloma.  The second SoP revoked the first SoP.  The factor relating to exposure to paints and lacquers now read as follows (par 5(b)):

“being occupationally required to work as a painter for an average of three or more days per week over any two year period, (or working as  a painter for a period or periods of time totalling at least 312 days) before the clinical onset of multiple myeloma, and where that occupational exposure has ceased, the clinical onset of multiple myeloma has occurred within 20 years of cessation.”

12                  The applicant’s appeal was heard by the AAT on 7 October 1998. She was represented by counsel.  Before the AAT the applicant’s case was that her husband had been exposed to paints and lacquers while working on aircraft.  I was told by counsel that there was tendered on behalf of the applicant a statutory declaration by a person who, although he did not know Mr Keeley, could speak of the kind of work the latter was allegedly engaged in and its exposure to paints and lacquers.  Mr Keeley’s service records were tendered to establish that he was engaged in that sort of work.  As already mentioned, the AAT did not proceed to an assessment of that evidence because it was accepted on behalf of the applicant that it could not be shown that Mr Keeley’s experience met the requirements of par 5(b) of the second SoP, if that were applicable.

The legislative framework

13                   Under VEA s 13(1)(a) and (c), where the death of a veteran is war-caused the Commonwealth is liable to pay pensions by way of compensation to the dependants of the veteran in accordance with the Act.  Death of a veteran shall be taken to be war-caused if the death arose out of, or was attributable to, any eligible war service rendered by the veteran: s 8(1)(b).

14                  The Commission is to determine entitlement to a grant of pension:  VEA s 19(3).  A claimant dissatisfied with a decision of the Commission can apply for review by the VRB under VEA Pt IX Div 3.  Where a decision of the Commission has been affirmed by the VRB, the claimant can apply to the AAT for a review “of the decision of the Commission that was so affirmed”:  s 175(1)(a).

15                  In the course of determining whether Mr Keeley’s death was war-caused the AAT had to consider whether, on the whole of the material before it, a reasonable hypothesis was raised connecting that death with the circumstances of the veteran’s service:  s 120(1) and (3), Byrnes v Repatriation Commission (1993) 177 CLR 564 at 571. 

16                  For both the AAT hearing and decision there was “in force” an SoP (whether the first or second SoP) so the AAT could only find the applicant’s hypothesis to be reasonable if the appropriate SoP “upholds that hypothesis”:  s 120A(3).  The operation of SoPs is more fully discussed by the Full Court in Repatriation Commission v Deledio (1998) 83 FCR 82 at 95-98.

17                  The RMA is established under VEA Pt XIA.  Its members must be registered medical practitioners or medical scientists with at least ten years experience:  s 196M.

18                  SoPs are made by the RMA under s 196B(2).  They are based on “sound medical-scientific evidence”, which term is defined in s 5AB(2).  Each SoP is to state the factors that must as a minimum exist and which of those factors must be related to service before it can be said that a reasonable hypothesis has been raised connecting an injury, disease or death with the circumstances of a veteran’s operational service.  The term “related to service” is defined in s 196B(14).  The RMA can, after investigation, revoke an existing SoP and determine a new one:  s 196B(8)(c).

The AAT’s decision

19                  The AAT’s decision was handed down on 19 March 1999.  After referring to Rodway v The Queen (1990) 169 CLR 515 the AAT said that the VEA “expressly and by implication displaces the effect of the common law presumption against retrospectivity” as expressed in s 50 of the Acts Interpretation Act 1901 (Cth) (AIA).  The AAT continued:

“20.     The respondent [Commission] does not argue that the Statements of Principle can be categorised as procedural matters.  The AAT however considers that the Statements of Principle can be so categorised.

21.       The applicant, in order to succeed in this review must adduce evidence which establishes a reasonable hypothesis that the veteran dies [sic] as a result of a war-caused injury.  The nature of the evidence that is required to be adduced is established by the applicable S.O.P. which is intended to represent the current “sound medical – scientific evidence” of a connection between a particular injury, disease, or death in operational service.

22.       The relevant S.O.P. is the template which determines what evidence must be adduced at the hearing.

23.       An S.O.P. affects procedure of the review, that is how (in this case) the applicant will prove that the veteran died as a result of war-caused multiple myeloma.

24.       The S.O.P. No. 134 of 1996 does not remove the veterans widow’s right to compensation for the death of her husband if a reasonable hypothesis can be maintained that the veteran died of war-caused multiple myeloma.”

Acts Interpretation Act s 50

20                  AIA s 50 provides:

“Where an Act confers power to make regulations, the repeal of any regulations which have been made under the Act shall not, unless the contrary intention appears in the Act or regulations effecting the repeal:

(a)       affect any right, privilege, obligation or liability acquired, accrued or incurred under any regulations so repealed; or

(b)       affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any regulations so repealed; or

(c)        affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment;

and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed, as if the repealing Act or regulations had not been passed or made.”

21                  VEA s 196D makes an SoP a “disallowable instrument” for the purpose of AIA s 46A.  It was not disputed that s 50 thus applies to the repeal or revocation of an SoP.  (It was not suggested there was any relevant distinction between repeal and revocation.)

22                  I do not agree with the AAT’s formulation of the present issue in terms of whether SoPs “can be categorised as procedural matters”.  AIA s 50 is applicable.  The answer to the present problem must be found in the terms of that provision.  The first question therefore is whether the repeal of the first SoP by the second SoP affected any “right” or “privilege” “acquired” by or “accrued” to the applicant under the first SoP.

23                  Decisions of the High Court and the Full Court of this Court compel an affirmative answer.  In Esber v Commonwealth (1992) 174 CLR 430 the High Court was concerned with an application before the AAT to review a decision refusing a claim for redemption of weekly payments of compensation made under legislation which had been repealed.  The application for review by the AAT had been lodged prior to the commencement of the new legislation. The effect of the High Court’s decision can perhaps be seen most clearly in the judgment of the dissentient (Brennan J) whose view did not prevail.  His Honour said (at 448, citations omitted):

“The appellant’s application to the AAT invoked an administrative jurisdiction to review his application under s 49(1) [of the Compensation (Commonwealth  Government Employees) Act 1971 (Cth)] for a redemption payment.  Exercising an administrative jurisdiction, the A.A.T. determines applications for review on a rehearing de novo acting on the materials before it when it makes its determination.

Where, on a rehearing de novo, the question for decision is whether an applicant should be granted a right, the law as it then exists is applied, not the law as it existed at an earlier time.  By contrast, in a judicial proceeding brought to enforce an alleged right accrued at the time when the proceedings were instituted, the question for decision is determined according to the law existing when the proceedings were instituted unless statute otherwise provides.”

Later his Honour said (at 449):

“The distinction between a judicial proceeding to enforce an accrued right and an administrative proceeding to determine whether a right should be granted is critical in this case.  Clearly the appellant had no accrued right on 1 December 1988 to a redemption payment; the very purpose of the review by the A.A.T. which the appellant applied for was to obtain a right to a redemption payment.  As the A.A.T. was bound to apply the law as it was at the time of the rehearing, it was bound to refuse the application.”

24                  However the majority (Mason CJ, Deane, Toohey and Gaudron JJ) held that in the circumstances of that case the operation of that principle was overridden by AIA s 8.  (Section 8 deals with the repeal of Acts.  Its terms are not relevantly different from s 50 dealing with the repeal of regulations.)  Their Honours said (at 440-441, citations omitted):

“It may not be possible to say of a person in the position of the appellant that he had a right to a favourable determination from the Tribunal.  The Tribunal was required to stand in the shoes of the decision-maker (the delegate) and arrive at its own decision.  In Drake, Bowen CJ and Deane J said of the Tribunal:

‘The question for the determination of the Tribunal is not whether the decision which the decision maker made was the correct or preferable one on the material before him.  The question for the determination of the Tribunal is whether that decision was the correct or preferable one on the material before the Tribunal.’

But that is not to the point here.  If it be assumed that the appellant did not have a right to redemption in the sense first discussed, he had a right to have his claim to redemption determined in his favour if the delegate had wrongly refused his claim.  To borrow a sentence from the judgment of Hope J.A. in NSW Aboriginal Land Council v The Minister [The Winbar Claim]:

‘The right might be said to be a conditional one, namely, conditional upon the relevant facts being established, but the right was nonetheless a right because it was conditional.’

Once the appellant lodged an application to the Tribunal to review the delegate’s decision, he had a right to have the decision of the delegate reconsidered and determined by the Tribunal.  It was not merely ‘a power to take advantage of an enactment’.  Nor was it a mere matter of procedure; it was a substantive right.  Section 8 of the Acts Interpretation Act protects anything that may truly be described as a right, ‘although that right might fairly be called inchoate or contingent’.  This was such a right.  It was a right in existence at the time the 1971 Act was repealed.  That being so, and in the absence of a contrary intention, the right was protected by s 8 of the Acts Interpretation Act and was not affected by the repeal of the 1971 Act.”

25                  Reference might also be made to the observation of Fox J in J R Exports Pty Ltd v Australian Trade Commission (1987) 14 FCR 161 at 163:

“It is not possible to define an ‘accrued right’, any more than it is a ‘right’ but the notion which underlies the latter, when dealing with the present type of problem, is that there is something in the nature of a cause of action which has arisen, or is claimed to have arisen, before the repeal or amendment, in circumstances which would render it manifestly unjust for the repealing or amending Act to affect the situation adversely. 

What is not an accrued ‘right’ is a claim to an indulgence, without which there can be no claim of substance.”

26                  In Lee v Secretary, Department of Social Security (1996) 68 FCR 491, a Full Court of this Court (Davies, Cooper and Moore JJ) were concerned with a claim for waiver of the Commonwealth’s right to recover overpaid social security benefits.  The applicant appealed to the AAT against refusal of a waiver but after her appeal was lodged (in fact one day after) amending legislation came into force which restricted the statutory power of waiver.  The majority (Cooper and Moore JJ) held that AIA s 8 applied and that the legislation did not show any contrary legislative intention.  The division in the Full Court turned on the nature of the statutory provision under consideration.  The dissentient, Davies J, said (at 497) that the

“… subject of Ms Lee’s claim before the AAT was not ‘a right acquired or accrued’ in the sense explained by the majority in Esber.  The powers conferred by the Act to write off or to waive a debt or part thereof gave no right to the debtor other than a right to request that the waiver or write off provisions be considered.  There was a mere ‘power to take advantage of an enactment’, to use the words of Gibbs J in Mathieson v Burton.  The powers to waive or write off a debt or part thereof, as relied upon by counsel for Ms Lee, were not conditional, but discretionary.  No right was conferred thereby.”

27                  After referring to the passage from the majority judgment in Esber quoted above, Cooper J said (at 505):

“Applying the language of the High Court in Esber to the present case the applicant ‘had a right to have [her] claim to [waiver] determined in [her] favour if the delegate had wrongly refused [her] claim’.  That right arose, in my view, at the time the decision on the application for waiver was made on 13 December 1993.  The right was thereafter enforceable by recourse to the review procedures provided for under the Act.  Once those review procedures were initiated by a request for review on 23 December 1993, she had the right to have the decision of 13 December 1993 reconsidered and determined by the authorised officer in the first instance.  The reference by the majority in Esber to the decisions in Australian Coal & Shale Employees’ Federation v Aberfield Coal Mining Co Ltd [(1942) 66 CLR 161] at 175, 178, 185, 194 and Colonial Sugar Refining Co v Irving [[1905] AC 369] at 372-373 characterises the right of review, analogously with the right of appeal, as a substantive and not a procedural right.  The right of review was to have the application for waiver reconsidered de novo in accordance with the discretion vested in s 1237 as it stood on 13 December 1993.  That the majority judgment in Esber should be so construed was also the view of a Full Court of the Industrial Relations Court of Australia (Wilcox CJ, Ryan and Marshall JJ) in Gerrard v Mayne Nickless Ltd (1996) 135 ALR 494 at 509-514.

The submission of the respondent that the decision at each stage of the review process became the relevant operative decision and that the original decision of the delegate became incorporated in each new decision on review and thereby lost its character as the operative decision under review is inconsistent with the decision of a Full Court of this Court in Yolbir v Administrative Appeals Tribunal (1994) 48 FCR 246 and is rejected.”

28                  Moore J (at 515) regarded Esber as authority for the proposition that

“… a statutory right to seek a review of a decision made under a repealed Act is a right for the purposes of s 8 of the Acts Interpretation Act.”

29                  The majority in Lee held that a right to seek a review could be characterised as a right for the purposes of AIA s 8 even if the decision to be reviewed involved the exercise of a discretionary power by the repealed Act (see especially per Moore J at 515).  As has been noted, it was on this point that Davies J parted company with the majority.  But the present case is stronger.  

30                  A pension for the widow of a veteran whose death was war-caused is not a matter of discretion.  It is a liability imposed by VEA s 13 on the Commonwealth, once it is established that death was war-caused.  The essence of a discretionary decision is that, acting within proper bounds on a set of facts, a decision-maker may validly make a decision one way or the other.  This is the anthesis of the pension right conferred by VEA.

31                  At the time of the Commission’s decision the first SoP, a “statute-backed declaration of what is proved or known scientific fact” (Deledio at 96), had the effect that service-related occupational exposure of Mr Keeley to paints and/or lacquers was sufficient to raise for the applicant the hypothesis required by s 120(3).  This was so whether or not the applicant was then aware of the first SoP or its applicability to her case.  The applicant had acquired a right to a pension conditional or contingent upon, amongst other things, there being raised (in the sense discussed in the authorities) the fact that Mr Keeley in the course of his service had been occupationally exposed to paints or lacquers, over whatever period of time. 

32                  Counsel for the Commission did not argue that the present case was distinguishable from Esber or Lee.  He stated that the Commission would if necessary seek to have them reconsidered at appropriate appellate level.  I therefore hold that AIA s 50 is applicable unless the contrary intention appears.

Contrary intention

33                  Counsel for the Commission accepted that s 120A(3) does not address the present situation but he argued that a contrary intention may be derived from consideration of the relevant provisions’ “setting in the legislation and … the substance and tenor of the legislation”:  Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651 at 656.  Thus the Commission’s case is that the contrary intention is not manifested expressly but rather appears by necessary implication.

34                  Counsel argued that if an SoP is to be applied, even though none existed at the time of the claim, why should not a new SoP apply when an old one existed at the time of claim?  Counsel said further that the whole purpose of the RMA and the SoP system was to present the current “sound medical-scientific evidence” of connection between a particular injury or death and relevant operational service.  It is not to be imputed to Parliament, he said, an intention that more current medical scientific views expressed in the most recent SoP would not prevail.  Further, it is not to be assumed that subsequent SoPs will be less favourable to claimants.

35                  However, it seems to me that the same arguments might apply to virtually any amending or repealing legislation.  Parliament and its delegated law makers presumably only repeal or amend laws because the new law is considered an improvement on the old.  Notwithstanding that, there is an ancient principle of the common law, enshrined in the Acts Interpretation Act, that generally the legal consequences of events ought to be governed by the law in force when those events occur.  This is seen as a matter of justice and fairness.

36                  Counsel for the Commission referred to the Minister’s Second Reading speech at the time of the introduction of the 1994 amendments (Hansard, 9 June 1994, at 1807).  The Minister (Hon Kim Beazley MHR) spoke of the need to “ensure a more equitable and consistent system of determining (veterans’) claims”.  The Minister said (at 1808) that “lay tribunals (did) not deal with medical-scientific issues consistently” and that the new system would “ensure … consistency on medical-scientific issues at all levels of the determining system”. 

37                  But the need for consistency of decisions by lay tribunals is equally met by applying the SoP existing at the time of the primary decision.  Consistency in this context merely means that the question of the medical-scientific component of s 120(3) hypotheses is not left to widely varying (and in some cases perhaps idiosyncratic) opinions of individual doctors and scientists. 

38                  As already noted, counsel for the Commission pointed out that it is purely fortuitous that this legal issue is raised in the context of the present case where the repealed SoP happens to be more favourable to a claimant than to the Commission.  The reverse could equally well be the position in other cases.  Indeed in the last half century science has discovered that some substances previously considered harmless are extremely damaging to human health.  Tobacco, asbestos and Agent Orange are but some well known examples.  There is no reason to impute to Parliament an assumption that similar discoveries would not be made after 1994. 

39                  Considerable time may elapse between the Commission’s decision on a claim and a decision on review by the AAT, there being a VRB review in the meantime.  In the present case, three years and four months elapsed from primary decision to AAT hearing and a further five and a half months until the AAT’s decision, the best part of four years overall.

40                  The Commission has to deal with very many claims and is responsible for the proper application of what must be a huge amount of public money.  From the point of view of the Commission, it seems much preferable for the orderly management, planning and budgeting of its operations that potential liability for claims be ascertainable as early as possible.  The Commission’s argument in the present case, if accepted, would mean that when a decision on a claim is made by the Commission liability under the VEA is subject to variation – whether up or down – in an unpredictable way over an unpredictable period of the order of four years or more. 

41                  There is therefore nothing inherent in the nature of the SoP system that warrants the conclusion that Parliament thought it so obvious that decisions on AAT review would be governed by SoPs existing at the time of review that it was not necessary to expressly override AIA s 50.  Moreover, Esber was handed down only two years before the SoP amendments were introduced, so the need for clear overriding of the AIA provisions must have been fresh in the minds of drafters of the legislation – if that was in fact their intention.  

42                  Ogston is distinguishable.  The case was not concerned with AIA s 50 nor with the appropriate SoP to apply on AAT review. No doubt for these reasons there was no reference to Esber or Lee.  Indeed the fact that s 120A(1) expressly gives SoPs retrospective application to claims made back to 1 June 1994 is itself a further ground for concluding that no unexpressed contrary intention is to be found for the purposes of s 50.

43                  The appeal will be allowed.  The decision under review will be set aside.  There will be a direction that the matter be remitted to the AAT for further consideration according to law and an order that the respondent pay the applicant’s costs of the appeal, including reserved costs.

Associate:

Dated:              13 August 1999