FEDERAL COURT OF AUSTRALIA

Negri v Secretary, Department of Social Services (No 2) [2016] FCA 1125

ORDERS

THE COURT ORDERS THAT:

1.    The case be remitted to be heard and decided according to law, without further evidence, unless proper cause be shown.

2.    The Respondent pay the Applicant’s costs of the appeal.

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

REASONS FOR JUDGMENT

BROMBERG J:

1    On 5 August 2016 I made an order that the decision of the Administrative Appeals Tribunal (Tribunal) made on 26 February 2015 be set aside. I made orders requiring the parties to address the scope of the order I will now make remitting the case to the Tribunal for redetermination. I also gave the parties an opportunity to deal with the question of costs. It is the determination of those issues that these reasons address.

2    With the orders made on 5 August 2016, I published my reasons for judgment (Negri v Secretary, Department of Social Services [2016] FCA 879). I will refer to those reasons as “the Reasons”. These reasons should be read with the Reasons. Abbreviated terms utilised in the Reasons are here continued.

3    The first four paragraphs of the Reasons set out the relevant background and the questions raised by Ms Negri’s Further Amended Notice of Appeal. It is convenient that I set out those paragraphs here:

[1]    On 16 October 2012, the applicant, Ms Negri, claimed a Disability Support Pension (“DSP”) under the Social Security Act 1991 (Cth) (“SS Act”), on the basis that she suffered from, inter alia, fibromyalgia and depression. On 22 November 2012 a Centrelink Officer rejected that claim. Ms Negri was unsuccessful on internal review. She applied to the Social Security Appeals Tribunal and was again unsuccessful. On 2 April 2014, Ms Negri sought merits review of the SSAT’s decision in the Administrative Appeals Tribunal (“Tribunal”).

[2]    The Tribunal heard the application on 26 February 2015. There is no controversy that the Tribunal correctly identified the issue at [3] of its written reasons for decision, as follows:

… whether the Applicant was entitled to DSP according to the requirements of s 94(1) of the [SS Act] at the time of her claim on 16 October 2012, or within the subsequent 13 week period ending on 15 January 2013 … .

[3]    The Tribunal decided to affirm the SSAT’s decision, and gave ex tempore oral reasons. Ms Negri requested written reasons under s 43(2A) of the Administrative Appeals Tribunal Act 1975 (Cth) (“AAT Act”). On 26 March 2015, Ms Negri filed a Notice of Appeal in this Court. The Tribunal delivered its written reasons later that day, which are published as Negri v Secretary, Department of Social Services [2015] AATA 179. On 4 May 2015, Ms Negri amended her Notice of Appeal by adding a fourth question of law. At the hearing of the appeal, Ms Negri sought leave to further amend her Notice of Appeal, which I granted.

[4]    By her Further Amended Notice of Appeal, Ms Negri raised the following questions:

1.    Whether the Tribunal misconstrued the test in Table 1.

2.    Whether the Tribunal failed to consider and determine the Applicant’s claim that her depression had been fully diagnosed as required under Table 5.

3A.    Whether the Tribunal’s decision that the Applicant’s depression was [not] fully diagnosed in 2009 was unreasonable as it was based significantly on an erroneous factual premise.

3B.    Whether the Tribunal was bound to take into account Dr Sillcock’s evidence (that Effexor was not prescribed as a sleeping tablet or as part of a pain management program) when the Tribunal made a finding that depression had not been diagnosed in 2009 based on Dr Sillcock’s evidence, and whether the Tribunal failed to do so.

4.    Whether the Tribunal made an independent assessment when it assigned 10 impairment points under Table 1.

the scope of the remittal

4    As the Reasons explain, Ms Negri’s appeal succeeded. Accordingly, an order needs to be made remitting Ms Negri’s case to the Tribunal for redetermination. As I said in O’Loughlin v Linfox Australia Pty Ltd (2015) 235 FCR 164 at [68] (which I repeated at [112] of the Reasons):

[68] … A remittal may be on a confined basis, or at large: Repatriation Commission v Nation (1995) 57 FCR 25 (Beaumont J, with whom Black CJ and Jenkinson J agreed); Stateships v Lawson (2009) 107 ALD 42 at 53 (Gilmour J). Where no condition is imposed on remittal, the whole of the case is remitted without limitation as to the presentation of further evidence or as to the scope of the matter to be dealt with: Rigoli v Federal Commissioner of Taxation (2014) 96 ATR 19 at [34] (Edmonds, Jessup and McKerracher JJ). An unqualified remittal, even for a matter to be determined according to law, would require the whole of the matter to be heard and decided again, and all questions of law and fact relevant to the claim to be considered and determined: Rigoli at [34], citing Peacock v Repatriation Commission (2007) 161 FCR 256 (Downes, Lander and Buchanan JJ).

5    Ms Negri submitted that the remittal should be unconfined. The Secretary took a different view. The Secretary submitted that the Court should remit the case to the Tribunal:

    … limited to reconsideration as to the following matters, without hearing further evidence, or without further evidence unless proper cause be shown:

a.    That the Tribunal further consider the submission made on behalf the Applicant in respect of the evidence of Dr Kader and having regard to the reasons of the Court determine whether the Applicant’s condition of depression had been diagnosed as required by the Introduction to Table 5 of the Tables in respect of the period 16 October 2012 to 15 January 2013 (paragraph 3 of the reasons of the Tribunal) (the relevant period).

b.    If the Decision in respect of a. is “yes”, the Tribunal decide whether the Applicant’s condition of depression was a permanent, “fully diagnosed”, “fully treated” and “fully stabilised” condition (as defined by the Tables) in the relevant period.

c.    If the answer in respect of a. and b. is “yes”, the Tribunal what was(if any), in the relevant period, the appropriate impairment rating under Table 5 arising from the Applicant’s condition of depression.

d.    Only in the event the Tribunal finds in favour of the Applicant in respect of the matters in a. to c. and finds that an impairment rating of at least 10 points should be assigned under Table 5 of the Tables, the Tribunal decide whether the Applicant satisfies the requirements of section 94(1)(c) of the Social Security Act 1991 (the Act) in the relevant period.

6    There are, I think, two significant issues in relation to which the parties are at odds. First, should the redetermination be made on the evidence before the Tribunal without further evidence? Second, should the redetermination be confined to Ms Negri’s claim of depression under Table 5 of the Tables and, if it arises, to a consideration of whether Ms Negri satisfies the requirements of s 94(1)(c) of the SS Act?

7    As to the first question, I agree with the position for which the Secretary contends. As [2] of the Reasons records, Ms Negri’s entitlement relates to an assessment period in late 2012 and early 2013. I presume that all of the evidence that each of the parties thought was necessary to be put before the Tribunal in relation to that assessment is already before the Tribunal. No updating is required. I am not aware of any reason for fresh evidence to be adduced. The AAT Act in ss 2A and 33 promotes the idea that reviews carried out by the Tribunal be dealt with economically. Whilst the need for economy does not trump the need for a fair review conducted according to law, there is nothing before me to suggest that such a result could not be achieved on the evidence already before the Tribunal. I take into account, however, that the unexpected sometimes happens and that inflexibility may hinder a fair result. Accordingly, I will order that the case be remitted for redetermination without further evidence unless proper cause be shown. That is, I will reserve to the Tribunal a capacity to admit fresh evidence if proper cause is shown.

8    The second question is more complicated. The Secretary’s position is that the Court’s order for remittal should reflect my finding of an error of law. As an error of law was only found in relation to ground 2 and the question of whether the Tribunal had properly determined Ms Negri’s claim for depression under Table 5, the Secretary contended that it is only that aspect of Ms Negri’s claim which should be redetermined, and not the claim made by Ms Negri in relation to fibromyalgia which, free of error, the Tribunal assessed as warranting 10 points under Table 1.

9    There is a difficulty with that submission. It is this. If, on the redetermination of the depression aspect of the claim, Ms Negri is assessed as having less than 20 points under Table 5, her rating under Table 1 in relation to fibromyalgia may have a bearing as to whether Ms Negri satisfies the 20 or more points requirement of s 94(1)(b). The Secretary’s position is that the rating of 10 points under Table 1 previously assessed by the Tribunal on 26 February 2015 (“first Tribunal”) in relation to fibromyalgia should remain undisturbed. Ms Negri, says that the difficulty with that is that, if, on the redetermination, Ms Negri is assessed as satisfying s 94(1)(b), for the purposes of s 94(1)(c), the reconstituted Tribunal (“second Tribunal”) would have to assess the combined impact of Ms Negri’s fibromyalgia and her mental health condition on her incapacity to work or participate in training so as to determine whether s 94(2)(aa), (a) and (b) are satisfied. That assessment, so Ms Negri contends, may give rise to inconsistent findings about the impact of Ms Negri’s fibromyalgia as between the first and second Tribunals if the second Tribunal is unable to make its own findings as to all of those aspects of Ms Negri’s claim which rely on fibromyalgia. The potential for inconsistency is perhaps greater than it might have otherwise been because the member that constituted the first Tribunal is no longer a member of the AAT. Consequently, a different member will necessarily constitute the second Tribunal.

10    If, by the scope of the remittal, the second Tribunal is required to adopt the ultimate finding of the first Tribunal in relation to Table 1, the first Tribunal will, in essence, be also adopting each of the findings made by the first Tribunal in relation to fibromyalgia. At the same time, in determining whether Ms Negri had a “continuing inability to work” as required by s 94(1)(c), the second Tribunal will be required to make its own findings in relation to fibromyalgia. Those findings may be inconsistent with the findings of the first Tribunal. It would be very undesirable for the second Tribunal’s decision to be based upon an inconsistency of the kind I have identified. That potential for inconsistency, to my mind, is graver than the potential for an inconsistent result as to the appropriate rating under Table 1 as between the first and second Tribunals.

11    The Secretary contended in response that the possibility of inconsistent findings can be avoided. The Secretary says that the first Tribunal’s findings, made when determining the Table 1 rating for Ms Negri, should be adopted by the second Tribunal for determining the impact, if any, of fibromyalgia on the question of whether or not Ms Negri has a “continuing inability to work”.

12    The difficulty with that response is that it would likely substitute one potential problem for another. The first Tribunal did not consider and therefore did not make any findings specific to the issue of whether or not Ms Negri has a “continuing inability to work”. If, on the redetermination, the second Tribunal gets to that issue, it will then arise for the first time. In my view, the second Tribunal will need to address that issue by reference to its own findings and not by adopting findings about Ms Negri’s fibromyalgia made by the first Tribunal but in relation to the determination by the first Tribunal of a different issue, namely, what rating should be given under Table 1. As Ms Negri submitted, in striving to avoid inconsistent findings, the second Tribunal may fetter its own decision making and fall into error. In this respect, a limited remittal may well bring about diseconomy to the ultimate disposition of Ms Negri’s claim. Confined remittals, as Gummow and Hayne JJ observed in Minister for Immigration and Multicultural Affairs v Wang (2003) 215 CLR 518 at [73]–[74], can cause difficulty.

13    In the circumstances, I do not propose to confine the remittal to the issues contended for by the Secretary. Should it become necessary for the second Tribunal to address an aspect of Ms Negri’s claim that raises a consideration of Ms Negri’s fibromyalgia, the Tribunal should make its own findings. As Ms Negri submitted, should that need arise, the fibromyalgia evidence will be revisited in any event and the practical benefit of limiting the referral will be marginal.

costs

14    Ms Negri submitted that as she has succeeded on the appeal the Secretary should pay her costs. She relied upon a summary of the general principles governing the award of costs set out by Kenny, Murphy and Beach JJ in Summers v Repatriation Commission (No 2) [2015] FCAFC 64 at [13]–[14] as follows:

[13]    The principles governing the award of costs are well understood. It is uncontentious that s 43 of the Federal Court of Australia Act 1976 (Cth) gives the Court a largely unfettered discretion in relation to costs. Section 43(3) relevantly provides that without limiting the discretion the Court may award costs in favour of, or against, a party whether or not the party is successful in the proceeding, or order a party’s lawyer to bear costs personally.

[14]    The discretion must be exercised judicially, not arbitrarily or capriciously, and must relate to the litigation in question: Trade Practices Commission v Nicholas Enterprises Pty Ltd and Others (1979) 28 ALR 201 at 206–207 (Fisher J). In the ordinary course costs will follow the event and if an appeal succeeds then the Court will order the respondent to pay the costs of the appeal and of the proceeding at first instance, unless there are special circumstances justifying some other order: Ritter v Godfrey [1920] 2 KB 47 (“Ritter”) at 52-53 (Lord Sterndale MR) and 54 (Atkin LJ); Gladstone Park Shopping Centre Pty Ltd v Ross Wills and Others (1984) 6 FCR 496 (“Gladstone Park Shopping Centre”) at 505 (Davies J); Ruddock v Vadarlis and Others (No 2) (2001) 115 FCR 229 at [11]-[16] (Black CJ and French J).

15    The Secretary contended that Ms Negri only succeeded on ground 2 and that the issues raised by that ground constituted a relatively minor proportion of the written and oral submissions to the Court. As Ms Negri failed on her other grounds of appeal, the Secretary contended that each party should be ordered to bear its own costs. The Secretary noted that a large portion of the work involved in the appeal arose in respect of ground 1 and, in particular, in relation to an issue which that ground raised relating to the proper identification of the Tribunal’s reasons (“the s 43 issue”). That issue is dealt with at [6]–[30] of the Reasons.

16    There are three reasons why I consider that there ought to be no discount of Ms Negri’s entitlement to costs. First, and putting to one side the s 43 issue, I do not consider that the grounds upon which Ms Negri failed significantly increased her legal costs and consequently those that the respondent will be liable to pay. Ms Negri was represented by Victoria Legal Aid and by Counsel whose fees were set at a flat rate. Second, there is no misconduct or unreasonable act of any kind asserted against Ms Negri (see Summers at [29]). Third, although in dealing with the s 43 issue additional costs were incurred, that issue raised a matter of general importance the determination of which it is likely to be of assistance to the Tribunal and of particular assistance to regular litigants before the Tribunal such as the Secretary.

17    Accordingly, I will order that the Secretary pay Ms Negri’s costs of the appeal.

Associate:    

Dated:    15 September 2016