FEDERAL COURT OF AUSTRALIA

Friar v Brown [2015] FCA 135

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    There is no order as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    There is no order as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    These matters involve two “appeals” under s 46 of the Superannuation (Resolution of Complaints) Act 1993 (Cth) (the SRC Act). The proceedings are brought in the Court’s original jurisdiction. Importantly, such appeals are confined to a question of law, which significantly limits the nature and scope of the appeal and the Court’s power to review findings of fact. The two appeals are related and were heard together.

Background facts

1    The following summary of the background facts draws heavily on the two decisions of the Superannuation Complaints Tribunal (the Tribunal).

2    Mr Neumann Friar (Mr Friar) passed away on 11 September 2010, aged 37. He had two superannuation policies, one was with the Construction and Building Unions Superannuation Fund (whose trustee was United Super Pty Ltd) and the other was with a fund called The Universal Super Scheme (whose trustee was MLC Nominees Pty Limited).

3    Mr Friar died intestate. He was survived by three sons, Jyden Brummell (born 14 June 1998), Liam Friar (born 10 February 2005) and Carmichael Friar (born 21 December 2007)). The maternal grandmother of Liam and Carmichael, Marian Brown, is their guardian. The eldest son, Jyden, is still a minor and is in the care of his mother, Amanda Chancellor. Mr Friar was also survived by two sisters: an elder sister, China May Friar (Ms Friar), and a younger sister, Femily Friar. At the time of his death, Mr Friar’s partner was Michelle Van Egmond.

4    The Trustee under the first superannuation policy determined to pay the entire benefit under that policy (totalling $204,690.05 as at 27 April 2012) in the following proportions:

(a)    25 per cent to the Public Trustee in trust for Liam Friar;

(b)    25 per cent to the Public Trustee in trust for Carmichael Friar;

(c)    25 per cent to Ms Friar; and

(d)    25 per cent to Jyden Brummell to be held pending contact.

5    On 18 December 2013, Liam and Carmichael Friar, through Ms Brown, lodged a complaint with the Tribunal that the Trustee’s decision to pay part of the benefit to China May Friar was unfair and unreasonable. They sought the benefit to be paid as follows:

(a)    20 per cent to Jyden Brummell;

(b)    35 per cent to Liam Friar; and

(c)    45 per cent to Carmichael.

6    The death benefit payable under the second superannuation policy totalled $74,400. The different Trustee under that policy determined to pay the benefit as follows:

(a)    35 per cent to the Public Trustee for the benefit of Liam Friar;

(b)    45 per cent to the Public Trustee for the benefit of Carmichael Friar; and

(c)    20 per cent to the Child Support Services for the benefit of Jyden Brummell.

7    On 24 August 2012, Ms Friar lodged a complaint with the Tribunal, claiming that the Trustee’s decision in relation to the second superannuation policy to pay the benefit in the proportions set out above was unfair and unreasonable. She claimed that she had an interdependency relationship with Mr Friar and that the benefit should be distributed as follows:

(a)    50 per cent to her;

(b)    25 per cent to Carmichael Friar; and

(c)    25 per cent to Liam Friar.

Relevant legislative provisions

(a)    The SRC Act

8    The relevant provisions of the SRC Act as at the time of the Tribunal’s determinations, included s 37(6), which provided:

(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 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.

9    As noted above, s 46 is an important provision. It provides for, and defines, the right of appeal to the Federal Court from a determination of the Tribunal:

Appeals to Federal Court of Australia from determinations of the Tribunal

(1)    A party may appeal to the Federal Court, on a question of law, from the determination of the Tribunal.

(2)    An appeal by a person under subsection (1) is to be instituted:

(a)    not later than the 28th day after the day on which a copy of the determination of the Tribunal is given to the person or within such further period as the Federal Court (whether before or after the end of that day) allows; and

(b)    in accordance with rules of court made under the Federal Court of Australia Act 1976.

(3)    The Federal Court is to hear and determine the appeal and may make such order as it thinks appropriate.

(4)    Without limiting by implication the generality of subsection (3), the orders that may be made by the Federal Court on an appeal include an order affirming or setting aside the determination of the Tribunal and an order remitting the matter to be determined again by the Tribunal in accordance with the directions of the Court.

(5)    The Federal Court must not make an order awarding costs against a complainant if the complainant does not defend an appeal instituted by another party to the complaint.

(b)    The SIS Act

10    The following relevant provisions of the Superannuation Industry (Supervision) Act 1993 (Cth) (the SIS Act) should be noted:

10    Definitions

…

child, in relation to a person, includes:

(a)    an adopted child, a stepchild or an ex nuptial child of the person; and

(b)    a child of the person's spouse; and

(c)    someone who is a child of the person within the meaning of the Family Law Act 1975.

…

dependant, in relation to a person, includes the spouse of the person, any child of the person and any person with whom the person has an interdependency relationship.

…

spouse of a person includes:

(a)    another person (whether of the same sex or a different sex) with whom the person is in a relationship that is registered under a law of a State or Territory prescribed for the purposes of section 2E of the Acts Interpretation Act 1901 as a kind of relationship prescribed for the purposes of that section; and

(b)    another person who, although not legally married to the person, lives with the person on a genuine domestic basis in a relationship as a couple.

…

11    Section 10A of the SIS Act came into effect after 30 June 2004. It defined the concept of an “interdependency relationship”, which is at the heart of the two appeals. Section 10A provided:

Interdependency relationship

(1)    Subject to subsection (3), for the purposes of this Act, 2 persons (whether or not related by family) have an interdependency relationship if:

(a)    they have a close personal relationship; and

(b)    they live together; and

(c)    one or each of them provides the other with financial support; and

(d)    one or each of them provides the other with domestic support and personal care.

(2)    Subject to subsection (3), for the purposes of this Act, if:

(a)    2 persons (whether or not related by family) satisfy the requirement of paragraph (1)(a); and

(b)    they do not satisfy the other requirements of an interdependency relationship under subsection (1); and

(c)    the reason they do not satisfy the other requirements is that either or both of them suffer from a physical, intellectual or psychiatric disability;

they have an interdependency relationship.

(3)    The regulations may specify:

(a)    matters that are, or are not, to be taken into account in determining under subsection (1) or (2) whether 2 persons have an interdependency relationship; and

(b)    circumstances in which 2 persons have, or do not have, an interdependency relationship.

(c)    The SIS Regulations

12    The following relevant provisions of the Superannuation Industry (Supervision) Regulations 1994 (Cth) (the SIS Regulations) should be noted. Regulation 1.04AAAA states various criteria to be taken into account in determining whether two people have or had an “interdependency relationship”:

(1)    For paragraph 10A(3)(a) of the Act, the following matters are to be taken into account in determining whether 2 persons have an interdependency relationship, or had an interdependency relationship immediately before the death of 1 of the persons:

(a)    all of the circumstances of the relationship between the persons, including (where relevant):

(i)    the duration of the relationship; and

(ii)    whether or not a sexual relationship exists; and

(iii)    the ownership, use and acquisition of property; and

(iv)    the degree of mutual commitment to a shared life; and

(v)    the care and support of children; and

(vi)    the reputation and public aspects of the relationship; and

(vii)    the degree of emotional support; and

(viii)    the extent to which the relationship is one of mere convenience; and

(ix)    any evidence suggesting that the parties intend the relationship to be permanent;

(b)    the existence of a statutory declaration signed by one of the persons to the effect that the person is, or (in the case of a statutory declaration made after the end of the relationship) was, in an interdependency relationship with the other person.

(2)    For paragraph 10A(3)(b) of the Act, 2 persons have an interdependency relationship if:

(a)    they satisfy the requirements of paragraphs 10A(1)(a) to (c) of the Act; and

(b)    one or each of them provides the other with support and care of a type and quality normally provided in a close personal relationship, rather than by a mere friend or flatmate.

Examples of care normally provided in a close personal relationship rather than by a friend or flatmate:

1.    Significant care provided for the other person when he or she is unwell.

2.    Significant care provided for the other person when he or she is suffering emotionally.

13    Regulation 6.22 of the SIS Regulations relevantly provided:

Limitation on cashing of benefits in regulated superannuation funds in favour of persons other than members or their legal personal representatives

(1)    Subject to subregulation (6) and regulations 6.22B, 7A.13, 7A.17 and 7A.18, a member's benefits in a regulated superannuation fund must not be cashed in favour of a person other than the member or the member's legal personal representative:

(a)    unless:

(i)    the member has died; and

(ii)    the conditions of subregulation (2) or (3) are satisfied; or

(b)    unless the conditions of subregulation (4) or (5) are satisfied.

(2)    The conditions of this subregulation are satisfied if the benefits are cashed in favour of either or both of the following:

(a)    the member's legal personal representative;

(b)    one or more of the member's dependants.

(3)    The conditions of this subregulation are satisfied if:

(a)    the trustee has not, after making reasonable enquiries, found either a legal personal representative, or a dependant, of the member; and

(b)    the person in whose favour benefits are cashed is an individual.

…

The Tribunal’s first determination

14    This review related to the Trustee’s decision in relation to the benefit under the Construction and Building Unions Superannuation Fund. The Tribunal noted that, under s 37(6) of the SRC Act, the Tribunal must affirm the decision under review if it is satisfied that the decision, in its operation in relation to Ms Friar, and any person who had become a party to the complaint and had an interest in the death benefit, was fair and reasonable in the circumstances. The Tribunal emphasised that its role did not authorise it to determine what decision it would have made on the evidence before it.

15    The Tribunal conducted its review on the papers. It noted that it had received submissions on behalf of Liam and Carmichael Friar, the Trustee, Ms Friar, Michelle Van Egmond and on behalf of Jyden Brummell.

16    The Tribunal noted that Ms Friar had provided a statement of financial circumstances and completed what was described as “an Interdependency Questionnaire”. It noted at [26] of its statement of reasons that on 20 May 2008 Mr Friar had lodged with the Trustee a non-binding nomination stating that 50 per cent of his death benefit should be paid to Ms Friar, with the remainder divided equally between Liam and Carmichael Friar.

17    The Tribunal set out various relevant provisions from the Trust Deed. It is unnecessary to repeat them all. However, the relevant parts of cl 5.5, which dealt with payment of death benefits, stated:

5.5    Payment of Death Benefit

…

(b)    Subject to the Deed, the Relevant Law and the Pension Regulations, the Trustee shall hold a Member’s Death Benefit upon trust:

(i)    if and to the extent required by a Binding Death Benefit Notice … to pay or apply the Death Benefit in accordance with that Binding Death Benefit Notice; or

(ii)    otherwise, to pay or apply the Member’s Death Benefit to such one or more of the following persons to the exclusion of the other or others and in such manner or proportions as the Trustee determines, namely to

(A)    the Member’s Dependants provided that the Trustee may take cognisance of any particular Dependant nominated to the Trustee by the deceased Member; and

    …

(c)    Any nomination by a Member under sub-clause 5.5(b)(ii)(A) shall be made in writing and be in such form as the Trustee may, from time to time, accept. The Trustee shall be entitled, but in no way obliged, to act in respect of such a nomination.

“Binding Death Benefit Notice” was defined in cl 7.2. It is unnecessary to set it out as Ms Friar did not contend that her brother had given such a notice. It was not contested that his was a non-binding nomination.

18    The nomination document contained the following statement:

This non-binding nomination is used by the Fund Trustee to help establish your dependants in the event of your death. You may change your nominated dependants at any time by writing to Cbus. Please note that the final decision on dependants rests with the Trustee.

19    After summarising the submissions made by Ms Brown on behalf of Liam and Carmichael Friar, as well as a brief submission made on behalf of Jyden Brummell, the Tribunal summarised Ms Friar’s submission (referred to as the “Elder Sister”) at [31] as follows:

•    At the time of the Deceased Member dying she was in an interdependency relationship with him.

•    They shared rental accommodation over their life and at the time of his death they were both living at the same address.

•    The Deceased Member lived with her on a regular basis and contributed to rent, food, cleaning, childcare and they helped each other out in all respects of living together in a close relationship.

•    Her relationship with the Deceased Member and their younger sister was not a ‘normal’ sibling relationship. The relationship was formed from being born into a physically violent and emotionally lacking home. They relied upon each other for survival and valued their relationship above all else. They had developed this as a means to cope and this had continued into their adult life.

•    The Deceased Member advised the Elder Sister that she would be a nominated beneficiary of his superannuation as he believed his children would be looked after by their grandparents, and if that were not the case she would become the principal carer.

•    Her financial position is a little worse than when the Deceased Member died as she has separated and is now a single parent. The Deceased Member knew that her marriage was not sustainable and therefore wanted her and her children to be looked after.

•    Whilst they were not living together at the time of the Deceased Member's death as he was on holidays, they intended to resume living together in mid September 2010.

•    The Deceased Member lived with her on and off for 10 years at one address and before that for varying lengths of time from 1992. While living at the same addresses he contributed to rent, food, cleaning, childcare and they helped each other out in all respects of living together in a close relationship.

•    The Deceased Member, their younger sister and she shared everything they had, if one needed money another would give it. Everything they each had they shared with each other, their rented houses, their cars, any possessions. The Elder Sister submits that this was and always has been the nature of the relationship.

•    Their younger sister has had at times mental instability and has been admitted to hospital several times as a result.

•    The Deceased Member knew that the Elder Sister would take care of her.

•    The relationship between the 3 siblings is well known and quite public.

20    The Tribunal described Ms Friar’s financial circumstances, including that she had an annual income of $30,000 and debts of $30,000. She had recently separated from her husband and had children. The Tribunal noted Ms Friar’s submission that her brother knew that her marriage was not sustainable and he wanted her and her children looked after.

21    The Tribunal also summarised Ms Friar’s submissions in response to submissions made by the other parties. The Tribunal noted that Ms Friar restated that it was her brother’s wish that she receive 50 per cent of his death benefit and that this was to be used to benefit her in gaining further education, as well as in setting up a trust for Liam and Carmichael Friar.

22    The Tribunal noted the submissions made by the Trustee, which included a statement that the Trustee had taken into account the beneficiary nomination in the membership application. The Tribunal also recorded that the Trustee’s conclusion that Ms Friar was a dependent of her brother was based on the following considerations:

-    she did not own any property but shared rental accommodation with her brother;

-    at the time of his death they were living together;

-    they moved in together after a previous girlfriend of her brother had moved interstate;

-    Mr Friar died while on holiday in another state visiting his children;

-    Mr Friar lived with Ms Friar for years on a regular basis and he contributed towards rent, food and assisted with childminding;

-    the brother and sister shared expenses, such as rent and assisted each other in all aspects of living together in a close relationship;

-    the close relationship was well known publicly; and

-    Ms Friar moved out of the house which she had shared with her brother before his death because it was too painful for her to remain.

23    At [44] of its statement of reasons, the Tribunal identified relevant matters for its determination as the identity of the beneficiaries, the wishes of Mr Friar, the financial circumstances and needs of the potential beneficiaries and the nature of the relationship between the beneficiaries and Mr Friar.

24    The Tribunal found that the Trustee’s decision that Mr Friar’s three children were persons to whom the Trustee, under the provisions of the Trust Deed, might pay a benefit was fair and reasonable.

25    After describing the purpose of superannuation as to provide income in retirement to a member and his or her dependants, the Tribunal explained in [46] of its statement of reasons that, in a case involving death before retirement, its approach was to consider what might have occurred had the member not died, and whether there was anyone who had an expectation or right of ongoing financial support had the member not died.

26    The Tribunal stated that it agreed with the Trustee that each of the three sons was entitled to share in the benefit payment but it added that it believed that consideration should be given to determining the duration for which the sons would have looked to their father for ongoing financial support. It stated that it was satisfied that, based on the ages of the three sons, it was fair and reasonable for the Trustee to determine that the percentage of the benefit should reflect their age differences and the period for which each would have an expectation of support from their father until he became independent.

27    The Tribunal then stated its findings in respect of Ms Friar’s claims (referred to as “the Elder Sister”). Because of their importance, it is desirable to set out [49]-[51] of the Tribunal’s reasons:

49.    In relation to the claim of the Elder Sister the Tribunal finds that the relationship of the Elder Sister and the Deceased Member was one of convenience and one that reflected a strong sibling relationship. It does not believe that there is sufficient evidence upon which a claim for interdependency can be founded. This is perhaps made more obvious by the fact that at the date of death of the Deceased Member the Elder Sister was married. Though the date she separated from her husband is not known there was a substantial period where he was present at the same time as an interdependency relationship was claimed.

50.    The provisions for the recognition of an interdependency relationship in the view of the Tribunal involve a fairly intimate and ongoing relationship between a couple, not the recognition of two people who happen to be living in a group household. The Tribunal also finds that that the Elder Sister was not financially dependent on the Deceased Member. The Tribunal considers that when the Deceased Member and the Elder Sister shared the same residence the financial arrangements were more akin to that of flatmates than of brother and sister sharing a house together.

51.    The Tribunal therefore finds that it was not fair and reasonable for the Trustee to conclude that the Elder Sister was a dependent or interdependent, and therefore a potential beneficiary in her own right.

28    The Tribunal then explained why it regarded the Trustee’s decision not to pay a benefit to Michelle Van Egmond was fair and reasonable.

29    The Tribunal found that the Trustee had given “little consideration to the relative merits of each claim and whether different amounts should be paid based on the ages of each of the Complainants and the Eldest Son (i.e. each of Mr Friar’s surviving sons).

30    It concluded that the Trustee’s decision to pay 25 per cent of the benefit to each of the three sons and also to Ms Friar to be not fair and reasonable in the circumstances and it substituted its own determination that the benefit be paid only to the three sons in the proportions set out in [6] above.

The Tribunal’s second determination

31    This review related to the Trustee’s decision in relation to the benefit under The Universal Super Scheme. As noted above, Ms Friar was the complainant in this review. Various other persons were joined in the review, including Carmichael and Liam Friar (who were represented by Ms Brown), and Jyden Brummell (who was represented by his mother). The Tribunal’s review was again conducted on the papers.

32    The Tribunal described as “fair and reasonable” the Trustee’s decision that Mr Friar’s three sons were potential beneficiaries. It also noted that Ms Friar had provided a statement of financial circumstances and completed an Independency Questionnaire.

33    The Tribunal set out various provisions of the Trust Deed which need not be repeated here as Ms Friar does not contend that they were misconstrued or misapplied by the Tribunal.

34    The Tribunal summarised each of the submissions which it had received. It summarised Ms Friar’s “extensive submission” in [26]:

•    At the time of the Deceased Member dying she was in an interdependency relationship with him.

•    They shared rental accommodation over their life and at the time of his death they were both living at the same address.

•    The Deceased Member died whilst on holiday interstate visiting his children.

•    The Deceased Member advised her that she would be a nominated beneficiary of his superannuation as he believed his children would be looked after by their grandparents, and if that were not the case she would become the principal carer.

•    The Deceased Member lived with the Complainant on and off for 10 years at one address and before that again for varying lengths of time since 1992. While living at the same address he contributed to rent, food, cleaning, childcare and they helped each other out in all respects of living together in a close relationship.

•    The Deceased Member, the Younger Sister and the Complainant did not have a ‘normal’ sibling relationship. The relationship was formed from being born into a physically violent and emotionally lacking home. They relied upon each other for survival and valued their relationship above all else. They had developed this as a means to cope and this has continued into their adult life.

•    The Deceased Member, the Younger Sister and the Complainant shared everything they had, if one needed money another would give it. Everything they each had they shared with each other, their rented houses, their cars and any possessions. This was and always has been the nature of the relationship.

•    The Younger Sister has had at times mental instability and has been admitted to hospital several times as a result.

•    The Deceased Member knew that the Complainant would take care of the Younger Sister.

•    The relationship between the 3 siblings is well known and quite public.

•    She is separated and has 2 minor children.

35    The Tribunal also summarised Ms Friar’s submission in response and outlined her and the other parties’ financial circumstances based on the material which it had received on that subject.

36    The Tribunal identified the issue which it had to determine as whether the Trustee’s decision to pay the death benefit as determined by it was fair and reasonable in its operation in relation to Ms Friar and the joined parties. It emphasised that the issue was not what the Tribunal would have decided on the evidence before it.

37    It identified relevant matters as the identity of the beneficiaries, Mr Friar’s wishes, the financial circumstances and needs of the potential beneficiaries and the nature of the relationship between the beneficiaries and Mr Friar. The Tribunal described the Trustee’s decision that the three minor children were persons who might be paid a benefit under the Trust Deed as “fair and reasonable”. The Tribunal also described the purpose of superannuation in similar terms to those set out in the reasons for its first determination.

38    The Tribunal concluded that it was fair and unreasonable for the Trustee to determine that the percentage of the benefit should reflect the sons’ age differences and, as a consequence, the amount of support each of them needed.

39    In relation to Ms Friar's claims, the Tribunal made the following findings in [42] of its statement of reasons:

The Tribunal finds that the relationship between the Complainant and the Deceased Member was one of convenience and one that was also a strong sibling relationship but not likely to be of an ongoing nature such as envisaged in the SIS Act or SIS Regulations. There was no clear evidence presented which showed an interdependent relationship or financial dependency. The Tribunal believes the provisions relating to the existence of an interdependency relationship envisage a close, caring and ongoing relationship between two people. To claim such an interdependency relationship in a household where the Complainant's husband was also present at least for some of the period under review makes no sense. The Tribunal also notes that the Younger Sister makes a similar claim relating to the same household which suggests such claims push the boundaries of reasonableness. The Tribunal therefore finds that it was fair and reasonable for the Trustee to conclude that the Complainant was neither financially dependent on the Deceased Member nor in an interdependent relationship with him, and therefore not a potential beneficiary in her own right.

40    The Tribunal then explained why it was satisfied that it was fair and reasonable for the Trustee to conclude that Femily Friar was not a dependent of Mr Friar, nor in an interdependent relationship with him. It also explained why it rejected the claims of other of Mr Friar’s relatives to have been dependent upon him.

41    At [45], the Tribunal indicated that, even if some level of dependency had been established on the part of Ms Friar or other specified relatives of Mr Friar, “it would still have been fair and reasonable for the Trustee to decide that the three minor children of the Deceased Member had a much greater right to support from the Deceased Member’s death benefit”.

42    The Tribunal affirmed as fair and reasonable the Trustee’s decision to allocate the benefit to the three sons in the percentages determined by it (see [7] above).

The appeals

43    In the first and second appeals, submitting notices were filed by the Tribunal and Ms Brown (acting on behalf of Liam and Carmichael Friar). Ms Chancellor (acting on behalf of Jyden Brummell) did not file any submissions or evidence in either appeal. Ms Friar was not legally represented in either appeal. She was the only person who actively participated in the appeals.

44    The questions of law in the first appeal were said to be as follows (errors in original):

1.    How could my brother Neumann & my relationship not be seen, & regarded (and therefore compensated) as an “interdependant relationship”?

2.    I question the law in disregarding my and my brother’s relationship that ruled in this matter that we had a “normal sibling relationship”

3.    I question this decision and state we had a lifelong interdependant relationship.

Findings of Fact

1.    To establish and verify that my broter Neumann Friar & I (China Friar) had an interdependant relationship

45    The grounds relied on were as follows (errors in original):

My brother Neumann Friar & my (China Friar) lifelong interdependant relationship.

46    Ms Friar sought to have the Tribunal’s decision varied so as to distribute 25 per cent of the benefit to her.

47    In the second appeal, the stated questions of law and stated grounds were substantially similar to those in the first appeal. Ms Friar contended that the Tribunal’s decision should be varied so that she received 25 per cent of the benefit.

48    In support of both her appeals and in accordance with the Court’s directions, Ms Friar filed a brief outline of submissions in support of her appeals together with various supporting documents, most, but not all, of which appear to have been before the Tribunal.

49    It is convenient first to outline Ms Friar’s written submissions before summarising the evidence she relied upon.

Summary of Ms Friar’s submissions in the appeals

50    In her outline of submissions in support of both her appeals, Ms Friar stated the relevant question of law as:

Does China Friar and Neumann Friar’s relationship fit the legal definition of an “interdependency Relationship”? (sic).

51    That question of law is expressed differently from those in Ms Friar’s notices of appeal.

52    After referring to s 10A of the SIS Act, Ms Friar then addressed the various criteria set out in that provision defining what is “an interdependent relationship” s 10A(1) (see [12] above). She submitted that her relationship with her deceased brother was an interdependent relationship within the meaning of that provision. As to paragraph (a) of s 10A(1) and the question whether they had “a close personal relationship”, Ms Friar submitted that she and her brother had such a relationship throughout their entire life due to their sibling relationship and an “extremely close bond that we developed growing up in a household with parents who were mentally unstable and violent and who used drugs, alcohol, gambling and violence on a daily basis”. She submitted that they developed “an unusually close, caring and supportive relationship to be able to survive in this hostile, traumatic and neglected environment”. Ms Friar emphasised that her relationship with her brother was not “convenient” or “normal”, but continued throughout their adult lives because they relied on each other financially, emotionally, domestically and personally, driven by the abusive circumstances surrounding their childhoods. Ms Friar contended that she and her brother “formed an extremely close personal relationship to survive our childhood and in turn living life as an adults (sic)”. She said that they were interdependent because they relied on each other to survive in a world where they only trusted each other.

53    As to paragraph (b) and the question whether they lived together, Ms Friar submitted that she and her brother had lived together as adults on and off since they were eighteen. This was so, she submitted, whether or not they were in other relationships. She claimed that their homes were always open to each other “as we had a combination of drug and alcohol dependency and mental health issues”. She said they supported each other whenever their personal relationships broke down or they lost jobs or were evicted, which happened frequently. Ms Friar submitted that her brother and her sister, Femily, were living with her when her brother died. She explained that Femily lived in Manly, but had been emotionally unwell and had moved in with Ms Friar and her then husband and daughter, as well as her brother. She said that her husband constantly complained about her brother and sister living with them but that she told him that they would always be part of her family and would look after each other.

54    Ms Friar said that her brother went to Queensland to visit his sons and died there in a hotel room of a drug overdose. She said that he had plans to return to live with her after the visit and that they both planned to work for their father’s company and continue to live together. She said that their plan was to make enough money to own their own house and then have their sister, Femily, move in with them.

55    As to paragraph (c) and the question of financial support, Ms Friar claimed that she and her brother shared their money (as also was the case with their sister Femily) according to who needed money or help. She said that the money was shared for basic things like food or even entertainment. She said that each of the three siblings always considered each other financially and shared what they had because they all knew how hard it was to maintain jobs and relationships.

56    As to paragraph (d) and the question of domestic care and personal support, Ms Friar claimed that the level of domestic care and personal care was great. She reiterated that the relationship they formed grew from the trauma, abuse and neglect that they had suffered as children. She said that whether they were living together or not they emotionally and personally supported each other. Ms Friar added that her brother looked after her children when he was alive, helped her with her work, actually worked with her for some years and shared money and a customer/client base. She explained that while one was working, the other would be cooking, shopping, childminding or cleaning and that they did whatever was needed to support each other.

57    In response to the Tribunal’s findings that these matters suggested a relationship of “convenience” and that the arrangements were more akin to that of flatmates than a brother and sister, Ms Friar submitted that this ignored the fact that there was nothing normal about their childhoods and the trauma involved. She said that because of their substance abuse and mental illness, they could not form lasting relationships other than with each other. In support of these submissions, Ms Friar relied on correspondence from Ms Brown and her daughter, Sa’ra, and submitted that this correspondence demonstrated their knowledge of the circumstances described above. She submitted that they “knew of the drug addiction and mental illness and my parents volatile domestic abuse and violence, that happened in front of us as children and formed Neumann, Femily and my, interdependent relationship”.

58    As to the Tribunal’s reliance on the fact that Ms Friar was married at the time of her brother’s death as being relevant to them not being interdependent, she submitted that this constituted a “personal view from what they think a ‘marriage’ is and has not taken into account what my marriage was”. She submitted that she attempted to have a normal family but even if she could not sustain a marital relationship, this did not prevent her from having an interdependent relationship with her siblings. Ms Friar also emphasised the significance of her brother’s signed written statement dated 20 May 2008, in which he said that he wished to distribute his death benefits to her and to Liam and Carmichael. She submitted that she was married at the time this statement was signed and that her brother allotted 50 per cent of his death benefits to her.

59    In further support of her submission that there was an interdependent relationship, Ms Friar submitted:

What Neumann Femily and I were was three innocent children born into a life of severe abuse, violence and dysfunction. We banded together and formed an unspoken pact, an unbreakable bond for life to look after each other. There is no one I loved or cared about more than my brother and sister. There was not one relationship or person that would have meant more to me, or who I would have cared about, protected or looked after more than Neumann or Femily. I am only alive today because we had each other. This is not normal for children to live like this or form these indestructible bonds and relationships.

60    For all these reasons, Ms Friar submitted that her circumstances satisfied each of the four criteria set out in s 10A(1) of the SIS Act.

Summary of Ms Friar’s evidence in the appeals

61    As noted above, Ms Friar tendered a selection of documents, most but not all of which were before the Tribunal. Ms Friar did not seek to persuade the Court as to why it should take into account any materials which were not before the Tribunal. The Court indicated that it would only have regard to documents which were before the Tribunal, were tendered in the appeals and to which the Court’s attention was specifically drawn.

62    The documents which were before the Tribunal and which were relied upon by Ms Friar in support of her appeals may be summarised as follows. First, she relied upon a series of letters, emails, Facebook pages and statutory declarations which contained statements from various persons concerning her relationship with her brother. Some of the material supported her claim that theirs was a relationship of interdependency, while other material was inconsistent with that characterisation. The material included letters from both Ms Friar’s parents which stated that the relationship between Ms Friar and her brother (as well as her younger sister) was one of interdependency and resulted in large measure from the family difficulties which they experienced as children and adults.

63    Secondly, Ms Friar relied on internal working documents of the Trustee under the first superannuation policy, including a document prepared by the case manager who recommended to the Trustee that the death benefit be paid to Mr Friar’s three sons (each to receive an amount of 25 per cent) and that 25 per cent also be paid to Ms Friar as a financial dependent. After referring to Ms Brown’s objection to Ms Friar receiving any benefit, the case manager stated:

Having considered the documents provided, it is noted that the childhoods of the late Member and his siblings was quite difficult. As a result they all bonded tightly and ensured that each cared for and protected the others as their parents had not played the traditional parental roles well. The Trustee is satisfied that the relationship between China Friar and the late Member was of a financially dependent nature owing to their shared residences and shared commitment to caring for one another.

The Trustee is also comfortable that both Liam and Carmichael are the children of the late Member. What is unclear is the ongoing care for the children. Currently Marian Brown has responsibility to care for the minors however this is a temporary order. Sa’ra-Skye Brown, the mother of the children has ongoing health issues that impede her ability to properly care for her children.

The Trustee is currently identifying the circumstances of Jaiden (sic) Friar/ Chancellor and will determine the outcome of any monies set aside for him once his claim eligibility is assessed.

After a review of the new evidence provided there has been no substantial evidence received to alter the original the decision (sic), therefore the proposed proportion allocation is deemed reasonable.

64    There is a handwritten note which appears on another document, which is dated 22 November 2013, and appears to have been written by the Trustee. The note states that the decision should be maintained and the stated rationale is recorded as: “The Trustee is satisfied the apportionment of the benefit is fair and reasonable”.

65    Thirdly, Ms Friar tendered a series of documents relating to Mr Friar’s employment with Civil Foundations Pty Ltd and various financial records which indicated that Mr Friar was in financial difficulties at various times in 2010 and 2011.

66    Fourthly, as noted above, Ms Friar tendered a copy of her brother’s non-binding nomination dated 20 May 2008 in respect of the first superannuation policy. It is significant that the nomination was not binding and, therefore, did not fall within cl 5.5(b)(i) of the Trust Deed (see [18] above).

Disposition of the appeals

67    The relevant legal principles relating to these appeals may be summarised as follows. First, as noted above, the Court’s jurisdiction under s 46 of the SRC Act is a limited one: a party to a proceeding before the Tribunal may appeal to the Court on a question of law alone.

68    Secondly, the subject matter of an appeal under s 46 is the question or questions of law on which the appeal is brought. It is important that the question of law be clearly formulated because it provides the very subject matter of the appeal (see TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation (1988) 82 ALR 175 at 178 per Gummow J in respect of the comparable provision in s 44 of the Administrative Appeals Tribunal Act 1975 (Cth)).

69    Thirdly, generally speaking, issues relating to the weight to be given to evidence do not give rise to a question of law (see Board of Trustees of the State Public Sector Superannuation Scheme v Edington [2011] FCAFC 8; (2011) 119 ALD 472 (Edington) at [61] per Kenny and Lander JJ).

70    Fourthly, no appeal lies under s 46 of the SRC Act from the Tribunal’s findings of fact, unless those findings were reached in a manner which gives rise to a question of law (see, for example, Edington at [36] per Kenny and Lander JJ). There is no error of law simply in making a wrong finding of fact (Waterford v Commonwealth (1987) 163 CLR 54 at 77 per Brennan J). Justice Foster recently expressed the principle in Hannover Life Re of Australasia Pty Ltd v Wright [2014] FCA 1163 at [21]:

… Where a choice falls to be made between two conclusions open on a consideration of the facts, the question is one of fact.

71    Fifthly, the question whether facts fully found fall within the provision of a statutory enactment properly construed is generally a question of law, at least where a statute uses words according to their ordinary meaning and the question is whether the facts as found fall within those words (Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 322; (1993) 43 FCR 280 and Sharp Corporation of Australia Pty Ltd v Collector of Customs (1995) 59 FCR 6 at 16 per Hill J). More recently, in Vetter v Lake Macquarie City Council [2001] HCA 12; (2001) 202 CLR 439 at [24], the High Court (Gleeson CJ, Gummow and Callinan JJ) observed, in the context of an appeal confined to a question of law from a trial court, that:

Whether facts as found answer a statutory description or satisfy statutory criteria will very frequently be exclusively a question of law. To put the matter another way… whether the facts found by the trial court can support the legal description given to them by the trial court is a question of law. However, not all questions involving mixed questions of law and fact are, or need to be susceptible of one correct answer only. Not infrequently, informed and experienced lawyers will apply different descriptions to a factual situation…

And at [27], their Honours referred approvingly to Mason J’s statements in Hope v Bathurst City Council (1980) 144 CLR 1 at 8-9 that:

… when it is necessary to engage in a process of construction of the meaning of a word (or phrase) in a statute a question of law will be involved, but that the question may be a mixed one of fact and law.… [A] question exclusively of law arises… if, on the facts found only one conclusion is open.

72    Sixthly, under the SRC Act, the Tribunal is not called upon to make the same kind of determination as the Administrative Appeals Tribunal. The Tribunal’s jurisdiction is not to determine whether the trustee made the correct or preferable decision but, rather, the Tribunal stands in the shoes of the trustee and determines, based on all the information before it, whether or not the trustee’s decision was fair or reasonable in the circumstances (see Edington at [46] per Kenny and Lander JJ; Cameron v Board of Trustees of the State Public Sector Superannuation Scheme [2003] FCAFC 214; (2003) 130 FCR 122 (Cameron) at [38]-[43] per Whitlam, Kiefel and Dowsett JJ). In Cameron, their Honours said at [43]:

A decision under review pursuant to s 37 of the Act may, as Allsop J pointed out in Crocker at [29], be ‘one which so involves elements of fact, degree, opinion or value judgment that different minds can legitimately differ in reaching a decision’. That is why the Tribunal's task is not to ask itself whether such a decision was the correct or preferable decision. The correct approach was pithily summarized by Allsop J in Crocker (at [31]) as follows:

‘The Tribunal's task is not to engage in ascertaining generally the rights of the parties, nor is it to engage in some form of judicial review of the decision of the trustee or insurer. Rather it is to form a view, from the perspective of the trustee or insurer, as to whether the decision of either was (recognising the overriding framework given by the governing rules and policy terms, respectively) unfair or unreasonable.’

73    Seventhly, if the Tribunal is satisfied that the trustee’s decision was not fair and reasonable, the Tribunal makes a decision that is fair or reasonable in substitution for the trustee’s decision and must act according to law (Edington at [47] per Kenny and Lander JJ).

74    Eighthly, the Tribunal may have to make its own findings of fact in conducting a review, but it does not decide afresh all findings of fact of the trustee or, in that sense, “stand in the shoes” of the trustee (Hornsby v Military Superannuation and Benefits Board of Trustees (No 1) [2003] FCA 54; (2003) 126 FCR 484 at [19] per Mansfield J and Edington at [50] per Kenny and Lander JJ).

75    Finally, the Tribunal may accept the findings made by the trustee if it agrees with them, but the Tribunal’s task is not simply to determine whether the trustee’s factual findings were fair and reasonable. The Tribunal must ascertain the facts for itself having regard to the material before it and satisfy itself by reference to these facts whether the trustee’s decision was fair and reasonable in the circumstances (Edington at [51] per Kenny and Lander JJ).

76    I shall now apply those principles to the circumstances of the appeals here.

77    As to the requirement that the appeal raise one or more questions of law I doubt that the questions of law as posed in two notices of appeal properly raised a question of law. Rather, the questions posed appear to challenge the Tribunal’s findings of fact which, as noted above, do not present a question of law unless the findings are reached in a manner which involves an error of law.

78    It is to be noted, however, that Ms Friar reformulated the relevant question of law raised in the appeals in her outline of written submission (see [51] above). Having regard to that reformulation and also to the fact that Ms Friar did not have the assistance of any legal representation in the appeals, I am prepared to accept that the appeals do raise a question of law, which is to the following effect: whether, on the facts found by the Tribunal, the Tribunal should have concluded in Ms Friar’s favour that she and her brother had an interdependent relationship within the meaning of s 10A of the SIS Act and no other conclusion was open to it.

79    After summarising the matters relied on by Ms Friar the Tribunal stated in its first determination that it rejected her claims having regard to the following findings and matters:

(a)    the relationship between Ms Friar and her brother was one of convenience and reflected a strong sibling relationship;

(b)    there was insufficient evidence to ground a claim of interdependency;

(c)    at the date of Mr Friar’s death, Ms Friar was married and, although it was unclear when she separated from her husband , there was a substantial period where they lived together at the same time as Ms Friar claimed to have a relationship of interdependency with her brother;

(d)    Ms Friar was not financially dependent upon her brother; and

(e)    although Ms Friar shared the same residence as her brother, their financial arrangements were more akin to that of flatmates than of brother and sister sharing a house together.

80    In the light of these matters, the Tribunal concluded that it was not fair and reasonable for the Trustee to conclude that Ms Friar was a dependent or interdependent so as to be a potential beneficiary.

81    As I have emphasised above, the Court’s jurisdiction to review the Tribunal’s findings of fact is very limited. It is not to the point that the Court might have itself made different findings of fact or attached different weight to the relevant facts. The relevant legal issue is whether, having regard to the facts as found (assuming that those findings of fact were reasonably open on the evidence before the Tribunal), the Tribunal was obliged in law to conclude that there was an interdependency relationship within the meaning of s 10A. In my view, in circumstances where the facts as found were reasonably open to the Tribunal, it cannot be concluded that the Tribunal erred in determining that it was not fair and reasonable of the Trustee to find that Ms Friar was dependent on her brother or that they had an interdependent relationship for the reasons given by the Tribunal.

82    It is evident from Ms Friar’s outline of written submissions that she genuinely believes that, in reaching that conclusion, the Tribunal gave too much weight to some matters and too little weight to other matters. However, these are matters which are insufficient to attract the Court’s limited jurisdiction in a s 46 appeal under the SRC Act.

83    In the case of the Tribunal’s second determination, and again after setting out the matters relied on by Ms Friar, the Tribunal rejected her claims based upon the following findings and matters:

(a)    a finding by the Tribunal that the relationship was one of convenience and, even though there was a strong sibling relationship, the relationship was not likely to be one of an ongoing nature as contemplated by the legislation;

(b)    there was no clear evidence which established an interdependent relationship or financial dependency;

(c)    Ms Friar lived with her husband for at least some of the period in which she claimed she had an interdependent relationship with her brother, which the Tribunal found “makes no sense”;

(d)    Ms Friar’s younger sister made similar claims in respect of the same household, which suggested to the Tribunal that the claims pushed “the boundaries of reasonableness”; and

(e)    in the light of these matters, it was fair and reasonable for the Trustee to reject Ms Friar’s claims in the second matter.

84    For similar reasons as given above in respect of the first appeal, I am not satisfied that Ms Friar has established appealable error in respect of the Tribunal’s second determination. The facts as found by the Tribunal were reasonably open on the evidence. Having regard to those findings of fact and the other matters relied upon by the Tribunal it cannot be accepted that the Tribunal erred in law in concluding that there was no interdependency relationship within the meaning of s 10A.

85    For completeness, it might be noted that the rejection of Ms Friar’s appeals does not mean that the Court agrees with or endorses all of the language used by the Tribunal in its statements of reasons. It should not be assumed, for example, that the Court takes the view that an interdependency relationship can never be established in a household where siblings live together and one also happens to be married to, and lives with, a third person. Every case has to be looked at according to its particular circumstances. The Court does not read the Tribunal’s reasons, particularly in relation to its second determination, as precluding the possibility of a relationship of interdependency being established in such circumstances, as long as the other relevant requirements are also established. The Court considers that the language used by the Tribunal in respect of this matter reflects, correctly, the Tribunal’s own limited role in reviewing the Trustee’s determination and determining whether it was “fair and reasonable” in the particular circumstances here.

Conclusion

86    Both appeals should be dismissed, with no order as to costs.

Associate:    

Dated:    27 February 2015