FEDERAL COURT OF AUSTRALIA

Border v Repatriation Commission [2010] FCA 264

THE COURT ORDERS THAT:

1.                  The respondent’s notice of motion to strike out the appeal be dismissed.

2.                  The appellant be given leave to amend his notice of appeal.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

Introduction

1                     The appellant, Mr Roger Keith Border, made a claim under the Veterans’ Entitlements Act 1986 (Cth) (“the Act”) for the costs of medical treatment and a pension for incapacity as a result of a post traumatic stress disorder (“PTSD”), said to be war caused within the meaning of s 9 of the Act.  On 21 March 2007, the Repatriation Commission determined that Mr Border’s PTSD was not related to his war service.  That decision was affirmed by the Veterans’ Review Board on 5 June 2008 and the Administrative Appeals Tribunal (“the Tribunal”) on 30 November 2009.

2                     Mr Border filed an appeal in this Court against the decision of the Tribunal on 23 December 2009.  In response, the Commission filed a notice of motion on 4 February 2010 to strike out his appeal under s 31A of the Federal Court of Australia Act 1976 (Cth) (“the Federal Court of Australia Act”), on the basis that the notice of appeal did not identify a question of law as required by s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (“the AAT Act”).

3                     In its original form, the question of law raised by Mr Border’s notice of appeal was whether the Tribunal erred in its interpretation and application of s 120(1) of the Act.  On 5 February 2010, Mr Border filed a notice of motion for leave to amend his original notice of appeal to re-state the questions of law to be raised on appeal as:

·                    The Tribunal’s finding was not open on the basis of the accepted evidence and s 120 of the Act; and

·                    The Tribunal drew inferences from findings of fact which were not supported by probative material.

4                     During the hearing of the two notices of motions referred to above, Mr Border sought to rely on a further amended notice of appeal.  The questions of law raised in this further notice of appeal were stated as follows:

·                    Whether the Tribunal’s findings that the appellant’s accepted condition of PTSD was not war caused was open on the basis of the accepted evidence and s 120 of the Act;

·                    Whether there was any evidence from which the Tribunal was able to draw the inference that the PTSD was other than war caused.

5                     Mr Border also sought to raise additional grounds in support of his appeal, including the following:

·                    In determining whether the PTSD was war caused, the Tribunal was not to engage in any fact finding but rather to determine only whether or not a reasonable hypothesis existed; and

·                    That the Tribunal misdirected itself as to its function under s 120(1) of the Act; and

·                    There was no evidence upon which the Tribunal could determine that the PTSD was other than war caused.

ISSUES TO BE DETERMINED

6                     Mr Border’s notice of motion for leave to amend the notice of appeal was the first issue addressed at the hearing.  The Commission opposed the amendment upon the ground of futility.  Specifically, it submitted that no useful result could flow from the amendment because the appeal had no reasonable prospects of success, as it, too, did not identify a proper question of law.

7                     It follows that the issue to be determined on both notices of motion is whether the appellant has identified a proper question of law arising out of the Tribunal’s decision.

SECTION 31A OF THE FEDERAL COURT of australia ACT

8                     The Commission has brought its application to strike out Mr Border’s notice of appeal under s 31A of the Federal Court of Australia Act.  That section relevantly provides:

(2)        The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:

(a)        the first party is defending the proceeding or that part of the proceeding; and

(b)        the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.

(3)        For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:

(a)        hopeless; or

(b)        bound to fail;

for it to have no reasonable prospect of success.

9                     Since the word “proceeding” includes an appeal (see the definition in s 4 of the Federal Court of Australia Act), the Commission is able to rely upon s 31A to bring its application:  see Pham v Secretary, Department of Employment & Workplace Relations [2007] FCAFC 179 at [14], Bishop v Secretary, Department of Education, Employment and Workplace Relations [2008] FCA 1118 at [12] per Buchanan J and Kulik v Administrative Appeals Tribunal [2009] FCA 1324 at [1] per Finn J.

10                  I am able to deal with this application as a single judge under s 25(2B)(aa) of the Federal Court of Australia Act.

11                  The Commission bears the onus in this strike out application:  see Jefferson Ford v Ford Motor Co (2008) 167 FCR 372 (“Jefferson Ford”) at [127] per Gordon J and Windsor v Sydney Medical Service Cooperative Ltd (No 2) [2009] FCA 704 (“Windsor”) at [38] per Edmunds J.  Accordingly, the Commission has to establish that Mr Border has “no reasonable prospect of successfully prosecuting” his appeal.

12                  It is clear from its terms, particularly subsection (3), that s 31A sets a lower standard for strike out applications than that set by High Court decisions such as General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 129 to 130 per Barwick CJ:  see Duncan v Lipscombe Child Care Services (2006) 150 IR 471; [2006] FCA 458 at [5] per Heerey J, Lawrenson Light Metal Die Casting Pty Ltd (In Liq) v Cosmick Pty Ltd [2006] FCA 753 at [15] per Heerey J, Jewiss v Deputy Commissioner of Taxation [2006] FCA 1688 at [26] per Mansfield J, Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd (2007) 236 ALR 720; [2006] FCA 1352 (“Boston Commercial”) at [27] per Rares J; Genovese v BGC Construction Pty Ltd [2007] FCA 923 at [4] per Gilmour J and Jefferson Ford at [124] per Gordon J.

13                  However, there have been differing opinions expressed by various judges of this Court as to what standard now applies:  see the decisions referred to above and others including:  Jefferson Ford in the Full Court; and the single judge decisions in Roadshow Films Pty Ltd v iiNet Limited [2009] FCA 332 at [14] per Cowdroy J; Adnunat Pty Ltd v ITW Construction Systems Australia Pty Ltd [2009] FCA 499 (“Adnunat”) at [37] per Sundburg J; Desai v Keelty (2009) 180 FCR 559 at [8] per Tracey J; Windsor at [40] per Edmonds J; and Wang v Anying Group Pty Ltd [2009] FCA 1500 at [43] per Foster J.

14                  This question was most recently considered, but not resolved by the Full Court in Bond v Barry (2008) 173 FCR 106 (“Bond”).  There, the Court said (at [71] to [74]) that:

[71]      The proper approach to an application for summary disposal of a proceeding under s 31A of the Federal Court Actwas considered by a Full Court in Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd (2008) 167 FCR 372.

[72]      In that case Finkelstein J, at [23] considered that where a question of law arises, the judge should conduct an inquiry into the merits of the question to decide whether it is sufficiently strong to warrant a trial.  Rares J at [74] was of a similar view.  Both judges were of the view that the Court has a discretion to determine the question of law.

[73]      Gordon J at [128]-[131] was of a different view.  She said that the existence of a real issue of law does not necessarily preclude summary judgment because the Court can usually hear and determine a disputed point of law expeditiously, without the need for a trial.  Graham J has expressed his disagreement with this: JF Keir Pty Ltd v Sparks [2008] FCA 611 at [12] and [52].

[74]      We do not need to decide which of the competing views expressed in Jefferson Ford is correct.  On any view, the learned primary judge considered that there was no room for debate about the questions of construction of s 65A on which it was necessary for Bond and Lesotho to succeed so as to avoid summary judgment.

15                  Many of the decisions mentioned above deal with questions of fact rather than questions of law and also with applications to strike out a claim, or a defence, rather than an appeal.  However, putting aside the question whether there is a discretion to act under s 31A, there does, in my view, appear to be broad agreement in the decisions of Jefferson Ford and Bond as to what the standard is when a question of law is involved.  In Jefferson Ford, Finkelstein J described it this way (at [23]):

…  On questions of law, the judge should conduct an inquiry into their merit, not for the purpose of resolving them (though this can be done – see Rosser v Austral Wine & Spirit Company Pty Ltd [1980] VR 313 at 320) and also not simply to determine whether the argument is hopeless, but in order to decide whether it is sufficiently strong to warrant a trial.  If the judge is satisfied that he (or she) is able to resolve any contested legal issue at a summary hearing and without undue delay, it may be better all around if that be done.  If not, then at least the merits must be tested.  That will then give s 31A a substantial operation, which is what, it seems to me, was intended.

16                  Rares J referred to his earlier decision in Boston Commercial (at [73]) and saw no reason to reconsider the views he had there expressed about the standard to be applied.  On that basis, he concluded (at [74]):  “Accordingly, if Jefferson Ford is able to establish that there was … a real issue of law capable of being decided in its favour then, … the matter ought to be allowed to go to trial in the ordinary way.”

17                  Finally, Gordon J described the standard that should be applied in relation to the question of law and the approach that a court should take to it as follows (at [131]):

By contrast, the existence of a real issue of law does not necessarily preclude summary judgment.  This is so because, assuming that there is no relevant factual dispute (or if the relevance of the factual dispute depends, as in the instant case, on the resolution of the legal dispute), the court can generally hear and decide a disputed point of law without the need for a trial or evidentiary hearing.  In such cases, the proper course for the court would be to accept submissions and hear argument from the parties in connection with the notice of motion hearing.  Even under the earlier, different and more stringent test, “argument, perhaps even of an extensive kind” was permitted “to demonstrate that the case of [a party] is so clearly untenable that it cannot possible succeed”:  General Steel Industries 112 CLR at 130.  Once the court resolves the issue or issues of law, it will then be clear whether the opposing party has reasonable prospects of success and summary judgment can be granted or refused accordingly.

18                  It can be seen from the three decisions in Jefferson Ford (above) that both Rares J and Gordon J have described the standard in terms of whether there is a real issue of law to be determined.  Finkelstein J has described it as whether the question is sufficiently strong to warrant a trial.  The Full Court in Bond was clearly of the view that these two descriptions of the standard were similar:  see at [72].  It follows that, in this matter, I should determine whether or not the question of law raised by Mr Border is a real question of law and is one that is sufficiently strong to warrant a full hearing of this appeal.

19                  As to the approach I should take, it is also clear from the various decisions in Jefferson Ford that I can proceed to determine the matter on the strike out application if there has been a full hearing on the issue or, if there has not, I can allow the matter to proceed to a hearing of the appeal.  While, on reflection, it could have been possible (and may have been desirable) to determine the question of law that Mr Border has raised, that is not how the parties agreed to conduct the strike out application and I do not therefore consider it is appropriate to deal with the matter in that way.

20                  Finally, I should note that in Boston Commercial, Rares J also emphasised the need to proceed with caution when dealing with an application under s 31A so as to ensure that a party is not unjustly shut out from litigating an issue that is fairly arguable:  see at [45] to [46].  Tamberlin J expressed similar views in Unit 11 Pty Ltd v Sharpe Partners Pty Ltd (2006) 150 FCR 405 at [64], albeit in relation to an application to strike out a claim at the pleading stage.  I consider this need for caution is reinforced by the fact that a party whose proceedings have been struck out under s 31A does not have any right of appeal, ie he or she must apply for leave:  see s 24(1A) and (1D) of the Federal Court of Australia Act.  This is all the more so in relation to an appeal under s 44 of the AAT Act because the appellant will not be able to rely upon s 24(1E), which allows a party to challenge an interlocutory judgment in an appeal from a final judgment in primary proceedings.

SECTION 44 OF THE AAT ACT

21                  It is well established that in an appeal from the Tribunal under s 44 of the AAT Act, an appellant must clearly identify a pure question of law – it is not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal:  see Birdseye v Australian Securities and Investments Commission (2003) 76 ALD 321 (“Birdseye”)at [17] to [18] and, more recently, Colby Corporation Pty Ltd v Federal Commissioner of Taxation (2008) 165 FCR 133 at [13] to [14].

22                  In oral submissions, counsel for the Commission specifically relied upon what was said in Birdseye at [29]: “If the decision of the tribunal is not based on a finding as to a particular fact, the appellant cannot found an appeal under s 44”.  The Commission submitted that, contrary to what is alleged in Mr Border’s third amended notice of appeal, the Tribunal did not make a finding that PTSD was not war caused.  Essentially, the Commission submitted that the matter alleged in the third amended notice of appeal does not, in fact, arise from the Tribunal’s decision and, therefore, Mr Border has no reasonable prospects of succeeding on the question of law he has identified.

23                  To assess whether this is so, it is necessary to identify what the Tribunal had to determine under s 120 of the Act and how it actually went about that task as disclosed in its reasons.  The former requires a consideration of the four steps outlined in the Full Court decision of Repatriation Commission v Deledio (1998) 83 FCR 82 (“Deledio”).  In relation to the latter, it should be noted that an examination of the Tribunal’s reasons is not limited solely to the questions of law raised in the notice of appeal.  The Court must also look to the grounds relied upon in support of the orders sought.  As Branson and Stone JJ pointed out in Birdseye at [18]: “it is in the specification of the grounds relied upon in support of the orders sought that, in our view, one should expect to find the links between the question of law, the circumstances of the particular case and the orders sought on the appeal”.  This is an important point in this case because it is in the grounds relied upon in support of the orders sought that Mr Border’s notice of appeal has identified how he says the Tribunal fell into error and thereby gave rise to the question of law.  Specifically, he alleges that the Tribunal engaged in fact finding when it was undertaking the third of the four Deledio steps and it misdirected itself as to its function under s 120(1) of the Act:  see [5] above.

SECTION 120(1) AND SECTION 120(3) AND THE DELEDIO FOUR STEPS

24                  Where a claim relates to operational service, ss 120(1) and 120(3) of the Act set out the standard and onus of proof to be applied by the Commission and the Tribunal in determining whether an injury or disease is war caused.

25                  Section 120(1) provides:

(1)        Where a claim under Part II for a pension in respect of the incapacity from injury or disease of a veteran, or of the death of a veteran, relates to the operational service rendered by the veteran, the Commission shall determine that the injury was a war-caused injury, that the disease was a war-caused disease or that the death of the veteran was war-caused, as the case may be, unless it is satisfied, beyond reasonable doubt, that there is no sufficient ground for making that determination.

Note: This subsection is affected by section 120A.

26                  Section 120(3) provides:

(3)        In applying subsection (1) or (2) in respect of the incapacity of a person from injury or disease, or in respect of the death of a person, related to service rendered by the person, the Commission shall be satisfied, beyond reasonable doubt, that there is no sufficient ground for determining:

(a)        that the injury was a war-caused injury or a defence-caused injury;

(b)        that the disease was a war-caused disease or a defence-caused disease; or

(c)        that the death was war-caused or defence-caused;

as the case may be, if the Commission, after consideration of the whole of the material before it, is of the opinion that the material before it does not raise a reasonable hypothesis connecting the injury, disease or death with the circumstances of the particular service rendered by the person.

Note: This subsection is affected by section 120A.

27                  Section 120A(3) provides:

(3)        For the purposes of subsection 120(3), a hypothesis connecting an injury suffered by a person, a disease contracted by a person or the death of a person with the circumstances of any particular service rendered by the person is reasonable only if there is in force:

                        (a)        a Statement of Principles determined under subsection 196B(2) or (11); or

                        (b)        a determination of the Commission under subsection 180A(2);

that upholds the hypothesis.

Note: See subsection (4) about the application of this subsection.

28                  In Deledio, the Full Court set out the four step process that should be followed by the Tribunal in applying these sections (at 97 to 98):

1.         The Tribunal must consider all the material which is before it and determine whether that material points to a hypothesis connecting the injury, disease or death with the circumstances of the particular service rendered by the person. No question of fact finding arises at this stage. If no such hypothesis arises, the application must fail.

2.         If the material does raise such a hypothesis, the Tribunal must then ascertain whether there is in force an SoP [Statement of Principles] determined by the Authority under s 196B(2) or (11). If no such SoP is in force, the hypothesis will be taken not to be reasonable and, in consequence, the application must fail.

3.         If an SoP is in force, the Tribunal must then form the opinion whether the hypothesis raised is a reasonable one. It will do so if the hypothesis fits, that is to say, is consistent with the "template" to be found in the SoP. The hypothesis raised before it must thus contain one or more of the factors which the Authority has determined to be the minimum which must exist, and be related to the person's service (as required by ss 196B(2)(d) and (e)). If the hypothesis does contain these factors, it could neither be said to be contrary to proved or known scientific facts, nor otherwise fanciful. If the hypothesis fails to fit within the template, it will be deemed not to be "reasonable" and the claim will fail.

4.         The Tribunal must then proceed to consider under s 120(1) whether it is satisfied beyond reasonable doubt that the death was not war-caused, or in the case of a claim for incapacity, that the incapacity did not arise from a war-caused injury. If not so satisfied, the claim must succeed. If the Tribunal is so satisfied, the claim must fail.  It is only at this stage of the process that the Tribunal will be required to find facts from the material before it. In so doing, no question of onus of proof or the application of any presumption will be involved.  (emphasis added)

29                  Of particular significance to this case, at 96, the Court cited, with approval, a passage from the decision of the judge at first instance in relation to the assessment of the veteran’s hypothesis and the SoP at the third step mentioned above:

Do the facts raised by the claimant give rise to a reasonable hypothesis? Proof of facts is not in issue at this point. The hypothesis will not be reasonable if it is:

(i)                  contrary to proved or known scientific facts,

(ii)                obviously fanciful, impossible, incredible, absurd, ridiculous, not tenable, too remote or too tenuous; or

(iii)               (since 1994) inconsistent with (not upheld by) an applicable SoP.  (emphasis added)

30                  It is quite clear from the parts of Deledio emphasised above that, in undertaking the first and third steps and determining whether the hypothesis put forward by the veteran is a reasonable one consistent with the relevant Statement of Principles in force at the time of making the decision, the Tribunal is not to engage in any fact finding exercise, nor is there any onus of proof involved.

31                  This is also consistent with what the High Court said in Bushell v Repatriation Commission (1992) 175 CLR 408 (“Bushell”) (per Mason CJ, Deane J and McHugh J) (at 413):  “Sub-section (3) is concerned with whether ‘the material’ raises a reasonable hypothesis that the relevant injury, disease or death was connected with the service of the veteran.  It is not concerned with conflicts in the material, whether they be of opinion or fact.  The purpose of sub-s (3), as demonstrated by its terms and its history, is to ensure that a claim to which s 120 applies is not met unless there is some material which raises the relevant causal hypothesis.”  (emphasis added)

THE TRIBUNAL’S DECISION

32                  The critical paragraphs of the Tribunal’s decision are [33] and [37] to [40].  At [33], the Tribunal purports to apply the four step process in Deledio as follows:

33.               There is a hypothesis raised between the facts presented by the applicant and his military service. Step 1 is therefore satisfied. Step 2 is satisfied in that an SoP has been declared which covers the situation raised by the applicant. In relation to Step 3, the evidence must point to the criteria in the SoP for it to be a reasonable hypothesis. I have already accepted that Mr Border has PTSD and a cluster of symptoms of long-standing which, according to Dr Calder-Potts, Dr Majumdar and Professor Jones, indicate generalised anxiety disorder and obsessive compulsive personality traits. The question for the Tribunal is whether the four incidents raised by the applicant explain and fall within the template raised in factor 6a of SoP No. 5 of 2008, i.e. “experiencing a life threatening event”.

33                  The Tribunal then turned to consider the details and circumstances of the four incidents concerned to determine whether each could be “objectively … regarded as a life threatening event”.  The four incidents are described earlier in the Tribunal’s reasons as:  the “scorpion event”, the “torch event”, the “rockets event” and the “moved base event”.  While the Tribunal assessed these incidents as variously “very serious”, sensitive, “unpleasant” and confusing or isolating, it did not assess them to be sufficiently serious to constitute a “life threatening event”.

consideration

34                  Taking into account the terminology used by the Tribunal in the paragraphs of its reasons referred to above, ie “the evidence must point to the criteria in the SoP” and the level of detail with which the Tribunal considered the circumstances of each of the four incidents, notwithstanding that the Tribunal denied that it was engaging in any “factual findings about evidence”, I consider there is a real question about whether the Tribunal did, in fact, engage in a fact finding exercise when it was assessing whether Mr Border’s hypothesis was reasonably consistent with the template in the SoP, contrary to the Full Court’s decision in Deledio.

35                  Furthermore, I consider that the Tribunal’s statement that:  “There is a hypothesis raised between the facts presented by the applicant and his military service” raises a real question as to whether it has properly discharged its functions under s 120(1) (read with ss 120(3) and 120A) of the Act as delineated in Deledio to:  “… consider all the material … before it and determine whether [it] points to a hypothesis connecting … [Mr Border’s PTSD] … with the circumstances of [his] particular service …”.

conclusion

36                  Since I am considering this issue on a strike out application and without full argument as would occur at the hearing of an appeal, I do not consider it is appropriate for me to pre-empt that hearing by examining these issues any more closely than this.  It suffices to say that, in summary, I consider that the question of law raised by Mr Border is a real question that is sufficiently strong to warrant it being properly and fully considered at the hearing of this appeal.

37                  It follows that I do not consider that the Commission has shown that the question of law identified in Mr Border’s third amended notice of appeal, when read with his amended grounds of appeal, has no reasonable prospects of success.  Accordingly, the Commission’s notice of motion to strike out the appeal should be dismissed and the appellant should be given leave to amend his notice of appeal.

Associate:

Dated:         23 March 2010