FEDERAL COURT OF AUSTRALIA

Barnes v Repatriation Commission [2019] FCA 1685

ORDERS

THE COURT ORDERS THAT:

1.    The appeal under section 44 of the Administrative Appeals Tribunal Act 1975 (Cth) be dismissed.

2.    Unless a party notifies the Court by 4:00 pm on 23 October 2019, by writing stating opposition to this order, the applicant pay the respondent’s costs of the proceeding, as agreed or assessed.

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

REASONS FOR JUDGMENT

KENNY J:

1    This is an appeal from a decision of the Administrative Appeals Tribunal (Tribunal) under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act). On 29 August 2017, the Tribunal affirmed a decision of the Veterans’ Review Board (VRB), which in turn affirmed a decision of a delegate of the Repatriation Commission to refuse the application made by Mr Phillip Barnes for an increase in the rate of his disability pension under the Veterans’ Entitlements Act 1986 (Cth) (VE Act). It was common ground that the main issue before the Tribunal was, as the Tribunal identified, “whether Mr Barnes [was] entitled to receive [a] pension at the Intermediate or Special rate”. (The Tribunal’s decision has the citation Barnes v Repatriation Commission (Veterans' Entitlements) [2017] AATA 1385 (Tribunal reasons).)

2    For the reasons that follow, I would dismiss Mr Barnes’ appeal under s 44 of the AAT Act.

Background

3    The Tribunal found (at [1]) that Mr Barnes served as a clerk/auditor in the Royal Australian Air Force (RAAF) between 26 April 1971 and 31 December 1992. He achieved the rank of Sergeant.

4    Mr Barnes is now in his 60s and suffers from a number of medical conditions. He receives a Full Treatment Disability Pension at 100% of the “general rate”, as provided by s 22 of the VE Act. At the time of the Tribunal’s decision, Mr Barnes’ accepted conditions were: cervical, thoracic and lumbar spondylosis; sleep apnoea; fracture of the right malleolus (ankle); solar skin damage; sensorineural hearing loss; tinnitus; deviated nasal septum; and “pes planus [flat foot] right foot and left foot sprain”: Tribunal reasons, [12]-[13].

5    Mr Barnes applied to the Repatriation Commission for an increase in his pension in March 2014. His application referred to a “right ankle problem”, attributable to an ankle fracture suffered while playing football for an RAAF team. A delegate of the Repatriation Commission accepted Mr Barnes’ “right ankle problem” as service-related on 20 May 2014 but refused his application for a pension increase on the basis that Mr Barnes had “ceased work due to reasons other than [his] accepted disabilities, and [has] non-accepted disabilities that also impact upon [his] ability to undertake remunerative employment”. The delegate also found that Mr Barnes was not eligible for the Extreme Disablement Adjustment (see s 22(4) of the VE Act) as he was at that time under 65 years of age.

6    The VRB affirmed the decision of the Repatriation Commission on 18 November 2015.

7    Mr Barnes applied to the Tribunal for review of the decision of VRB on 18 March 2016. The Tribunal affirmed the decision under review on 29 August 2017.

Relevant legislation

8    Section 13(1) of the VE Act provides that the Commonwealth is liable to pay a pension by way of compensation to a veteran who is “incapacitated from a war-caused injury or a war-caused disease”. Broadly speaking, the meaning of the expressions “war-caused injury” or “war-caused disease” is the subject of s 9 of the VE Act. As the Commonwealth has accepted liability under s 13 in respect of a number of the conditions from which Mr Barnes suffers (accepted conditions or accepted disabilities), it is unnecessary to consider the extended meanings given by the VE Act to “war-caused injury” or “war-caused disease”. As a consequence of the Commonwealth’s acceptance of liability, Mr Barnes is a recipient of a pension at 100% of the general rate under s 22.

9    Section 15 of the VE Act provides a means by which a veteran in receipt of pension may apply for an increase in the rate of the pension “on the ground that the incapacity of the veteran has increased since the rate of the pension was assessed or last assessed”.

10    Division 4 of Part II of the VE Act, which deals with the different rates of pension payable to veterans for war-caused injuries and war-caused diseases, is central to this case. As already indicated, s 22 provides for the general rate. Section 23 provides for an intermediate rate of pension; and s 24 provides for a special rate of pension. The last-mentioned is the most generous rate. Amongst other things, to be entitled to a pension at the special rate the veteran must satisfy the decision-maker that the veteran (in s 24(1)(b)):

… is totally and permanently incapacitated, that is to say, the veteran’s incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week[.]

11    The Tribunal found that Mr Barnes was ineligible for a special rate of pension because he had “a capacity to work between 8-20 hours per week in suitable employment” and could not therefore satisfy s 24(1)(b) of the VE Act: see Tribunal reasons, [44]. Mr Barnes has not challenged this aspect of the Tribunal’s decision in this Court, and it is therefore unnecessary to examine it further. The Tribunal also found that Mr Barnes was ineligible for the Extreme Disablement Adjustment since he was under 65 years of age. Again, no aspect of this finding was challenged in this Court.

12    This case turns on s 23, which relevantly provides as follows:

Intermediate rate of pension

(1)    This section applies to a veteran if:

(aa)    the veteran has made a claim under section 14 for a pension, or an application under section 15 for increase in the rate of the pension that he or she is receiving; and

(aab)    the veteran had not yet turned 65 when the claim or application was made; and

(a)    either:

(i)    the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be at least 70% or has been so determined by a determination that is in force; or

(ii)    the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and

(a)    the veteran's incapacity from war-caused injury or war-caused disease, or both, is, of itself alone, of such a nature as to render the veteran incapable of undertaking remunerative work otherwise than on a part­ time basis or intermittently; and

(b)    the veteran is, by reason of incapacity from war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free from that incapacity; and

(c)    section 24 or 25 does not apply to the veteran.

(2)    Paragraph (1)(b) shall not be taken to be fulfilled in respect of a veteran who is undertaking, or is capable of undertaking, work of a particular kind:

(a)    if the veteran undertakes, or is capable of undertaking, that work for 50 per centum or more of the time (excluding overtime) ordinarily worked by persons engaged in work of that kind on a full-time basis; or

(b)    in a case where paragraph (a) is inapplicable to the work which the veteran is undertaking or capable of undertaking – if the veteran is undertaking, or is capable of undertaking, that work for 20 or more hours per week.

(3)    For the purposes of paragraph (1)(c):

(a)    a veteran who is incapacitated from war-caused injury or war-caused disease, or both, to the extent set out in paragraph (1)(b) shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, by reason of that incapacity:

(i)    if the veteran has ceased to engage in remunerative work for reasons other than his or her incapacity from that war-caused injury or war-caused disease, or both;

(ii)    if the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason; or

     (iii)    if the veteran has been engaged in remunerative work on a part-time basis or intermittently for reason other than his or her incapacity from that war-caused injury or war-caused disease, or both; and

(b)    where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented, by reason of that incapacity, from continuing to undertake remunerative work that the veteran was undertaking.

…

13    Provision is made in s 120 of the VE Act for the standard of proof to be applied in determining a claim for a pension. Section 120(4) is relevant in Mr Barnes’ case since he did not render operational service (as defined in the VE Act). Where s 120(4) applies, in making a decision in respect of a matter arising under the VE Act, including the assessment or re­assessment of the rate of a pension granted under Part II, the Repatriation Commission shall decide the matter to its reasonable satisfaction. The direction in s 120(4) has been said “to introduce the standard of proof required in civil litigation”: see Repatriation Commission v Smith (1987) 15 FCR 327 at 335 (Beaumont J, Northrop and Spender JJ agreeing). On review, the Tribunal must also make a decision to its reasonable satisfaction.

The tribunal’s decision

14    As already indicated, Mr Barnes’ focus in this Court was on the Tribunal’s determination that he was not entitled to an intermediate rate of pension under s 23.

15    The Tribunal’s reasons included a detailed account of the evidence, including that of Mr Barnes and of Dr Robyn Horsley, an occupational physician, both of whom gave evidence before it and were subject to cross-examination.

16    The Tribunal also carefully discussed the various medical reports before it about cervical, thoracic and lumbar spondylosis, including: Dr Horsley’s reports of 20 October 2016 and 14 July 2016; the 7 September 2016 report of Mr Patrick Lo, neurosurgeon; the 30 June 2015 letter from Dr Fotakis, general practitioner (said to be in part contrary to the specialist opinions of Drs Horsley, Joubert and Poon); the 24 April 2014 report of Mr Vasudeva S Pai, consultant orthopaedic surgeon; and the 17 April 2014 report of Mr David Prestage. The Tribunal also discussed the medical reports so far as they concerned an old fracture of the right malleolus (ankle), including the 14 July 2016 report of Dr Horsley; the 1 June 2015 letter from Philip Spark, podiatrist; the 26 May 2015 report by Dr Robert Piaggio, diagnostic radiologist; the 15 May 2015 x-ray report by Dr Alex Dulimov; and the 24 April 2014 report by Mr Vasudeva S Pai.

17    In addition, the Tribunal considered the expert evidence concerning solar skin damage, sensorineural hearing loss and tinnitus, and deviated nasal septum and held that none of these three conditions had “a significant effect on Mr Barnes’ capacity to undertake remunerative work”: see Tribunal reasons, [31]-[33].

18    The Tribunal also outlined the evidence relating to foot pain, which in large part concerned two conditions that had not been accepted by the Repatriation Commission and/or the VRB. These were the conditions of Plantar Fasciitis and Sinus Tarsii syndrome (non-accepted conditions). The Tribunal accepted that Mr Barnes had these non-accepted conditions at the time of its decision. As well, the Tribunal considered evidence relating to Mr Barnes’ shoulder problems and right knee.

19    The Tribunal recorded, at [42], that it had “placed more weight on the opinion of occupational physician, Dr Horsley, whose education and training is far more applicable to the circumstances of this case” than to the medical reports relied on by Mr Barnes. It added (at [41]-[42]):

Moreover, Dr Horsley’s opinion is contained in a comprehensive report that draws on her specialised knowledge and the reports of other physicians, which is then applied to the inter-relationship between Mr Barnes and his capacity for work. I note that orthopaedic consultant Mr Pai defers in his report to the judgement of occupational physicians when it comes to questions of employment capacity.

I therefore prefer Dr Horsley’s opinion over that of Dr Prestage and the other physicians, because her clinical assessment was comprehensive, whereas the referral underpinning Dr Prestage’s assessment was focussed substantially on Mr Barnes’ right ankle. Consistent with the opinion of Dr Horsley, which I note is reflected in Mr Barnes’ own assessment of his work capacity, I therefore find that he is able to work up to 20 hours per week in a ‘primarily sedentary role,’ where he can move around and sit-stand as he could do in his market research role.

20    The Tribunal supported its conclusion, by stating (at [43]) that it was “reasonably satisfied” that:

(a)    spondylosis was a substantial factor in Mr Barnes' decision to cease remunerative work and accepted Dr Horsley’s opinion that his neck and back condition limited his capacity to work to between eight and 20 hours per week;

(b)    sleep apnoea was a factor in his ceasing remunerative work. However, the Tribunal was not reasonably satisfied that it continued to affect Mr Barnes’ capacity to undertake remunerative work in a substantial way;

(c)    problems with his feet (principally being the non-accepted conditions of Plantar Fasciitis and Sinus Tarsi syndrome (see [53])) were a substantial factor in his incapacity and decision to cease remunerative work; and

(d)    Mr Barnes' other “accepted” and “non-accepted” conditions (right ankle, solar skin damage, sensorineural hearing loss and tinnitus, deviated nasal septum, shoulder and knee conditions) were not significant causal factors in his decision to cease remunerative work.

21    The consequence of the Tribunal's finding that Mr Barnes could work between eight and 20 hours per week was that it was unable to find that he was “totally and permanently incapacitated” for the purposes of s 24(1)(b) of the VE Act. He was therefore ineligible for a pension at the special rate, a conclusion that, as already noted, has not been challenged.

22    A question for the Tribunal remained as to whether Mr Barnes was eligible for a pension at the intermediate rate in accordance with s 23 of the VE Act. The Tribunal was, plainly enough, reasonably satisfied that Mr Barnes met the requirements set out in s 23(1)(aa), (aab) and (a)(i). The Tribunal found in substance that Mr Barnes satisfied the requirement in s 23(1)(b) because, by reason of his spondylosis alone, he was incapable of working “otherwise than on a part-time basis or intermittently”.

23    Turning to s 23(1)(c) of the VE Act, the Tribunal referred to a relevant passage in Flentjar v Repatriation Commission (1997) 48 ALD 1; 26 AAR 93 (Branson J, Beaumont and Merkel JJ agreeing). Although the Full Court in Flentjar was concerned with the requirements of s 24 of the VE Act, rather than s 23, the terms of ss 23(1)(c) and 24(1)(c) are virtually identical and the passage was therefore relevant to this aspect of its decision. The relevant passage was as follows:

1.    What was the relevant “remunerative work that the veteran was undertaking” within the meaning of s 24(1)(c) of the Act?

2.    Is the veteran, by reason of war-caused injury or war-caused disease, or both, prevented from continuing to undertake that work?

3.    If the answer to question 2 is yes, is the war-caused injury or war-caused disease, or both, the only factor or factors preventing the veteran from continuing to undertake that work?

4.    If the answers to questions 2 and 3 are, in each case, yes, is the veteran by reason of being prevented from continuing to undertake that work, suffering a loss of salary, wages or earnings on his own account that he would not be suffering if he were free of that incapacity?

24    In substance the Tribunal found, for the purpose of s 23(1)(c), that the remunerative work that Mr Barnes had been undertaking was as a car park attendant at the VRC and as a market researcher principally in homes and shopping centres. In identifying such employment, the Tribunal said (at [49]):

[49]    Mr Barnes’ work background is predominantly in accounts and clerical roles in the RAAF. The relevant remunerative work he was undertaking at the time he decided to resign in March 2014 had two components:

(a)    As a VRC attendant undertaking car park duty, checking passes and roving security for about eight hours per day. Mr Barnes undertook these part time shifts every few weeks, other than during busy periods like the Flemington Racing Carnival, and was required to stand for the majority of his shift; and

(b)    As a market researcher with Millward Brown, which had both an interview component at homes and shopping centres comprising approximately 80% of his work time, as well as an office-based role for approximately 20% of work time [.]

25    The next issue addressed by the Tribunal with respect to s 23(1)(c) was whether Mr Barnes had an accepted war-caused injury or war-caused disease that “of itself alone” prevented him continuing to undertake that work so that he suffered a loss of wages that he would not be suffering if he did not have that incapacity. After discussing the relevant medical evidence, the Tribunal held that Mr Barnes’ foot problems (Plantar Fasciitis and Sinus Tarsi Syndrome) contributed significantly to his inability to continue working at the VRC and Millward Brown, but that these conditions had not been accepted as a war-caused injury or war-caused disease by the Repatriation Commission or the VRB.

[50]    When asked whether in the absence of his accepted conditions, Mr Barnes could have continued in the roles he was undertaking prior to his resignations, Dr Horsley said he could not, because of the ‘extensive disability associated with his feet’. Dr Horsley stated that Mr Barnes’ Plantar Fasciitis had remained a significant issue over a number of years until resolved with orthotics in 2014. In Mr Edwards letter to Dr Fotakis dated 14 April 2016, he states that Mr Barnes had been off work for the previous two years ‘because of a combination of spine and foot pathology. His concerns today are his feet.’ Dr Fotakis noted eight years earlier on 8 February 2008, that Mr Barnes experienced ‘bilateral foot pain for some time,’ due to ‘Bilateral Plantar Fasciitis.’ Moreover, Mr Barnes’ Clinical Records reveal that in the years prior to ceasing work, the predominant issue requiring attendance at his general practitioner related to pain in both feet. By way of contrast during the same period, his presentations relating to accepted conditions of Spondylosis and Sleep Apnoea were scant and mostly related to DVA claims assessments, radiology referrals for ‘TPI review’ and a consultation on 30 June 2014 regarding an application for a disability parking permit – the latter related to pain in both his back and feet.

[51]    Both Mr Edwards and Dr Horsley have diagnosed Mr Barnes with Sinus Tarsi Syndrome, which Dr Horsley believes may be caused by his pes planus, which is age-related and biomechanical. This diagnosis follows prolonged Plantar Fasciitis over many years before it was resolved with orthotics in 2014. I note that neither Plantar Fasciitis nor Sinus Tarsi Syndrome are accepted as defence-caused conditions.

(Emphasis added)

26    The Tribunal concluded (at [53]) that it was “reasonably satisfied that problems with Mr Barnes’ feet, namely Plantar Fasciitis and Sinus Tarsi Syndrome … contributed significantly to his inability to continue working at the VRC and Millward Brown”. The Tribunal rejected (at [52]) Mr Barnes’ submission that there was “a sufficient causal relationship between his accepted foot/ankle conditions and the non-accepted conditions affecting his feet”. It held that the decision of the VRB to accept pes planus right foot and left foot sprain did not establish a causal relationship between his accepted conditions and the Plantar Fasciitis/Sinus Tarsi Syndrome. The Tribunal noted (at [53]) that neither the Repatriation Commission nor the VRB had made a determination that Mr Barnes’ Plantar Fasciitis or Sinus Tarsi Syndrome was a war-caused injury or a war-caused disease. Relying on Owen v Repatriation Commission (1995) 59 FCR 93 at 100-101, the Tribunal concluded (at [52]-[53]) that “the Tribunal has no role in concluding that an accepted condition has precipitated or contributed to a condition not yet accepted by the Commission or VRB”, although it was open to Mr Barnes to seek such a determination from the Commission.

27    The Tribunal’s finding that Mr Barnes’ Plantar Fasciitis and Sinus Tarsi Syndrome had significantly contributed to his inability to continue working at the VRC and Millward Brown meant that Mr Barnes did not satisfy s 23(1)(c) of the VE Act directly (see further below at [28]) because, as Mr Barnes properly conceded in submissions in this Court, this meant that he was not prevented from working more than 20 hours per week owing to war-caused injury or war-caused disease alone.

28    As indicated at [12] above, however, s 23(3)(b) provided another path by which s 23(1)(c) could be satisfied. Section 23(3)(b) was therefore critical to the Tribunal’s decision. In substance, s 23(3)(b) provided that where a veteran, who is less than 65 years of age and has not been engaged in remunerative work, satisfies the Commission that:

(1)    the veteran has been genuinely seeking to engage in remunerative work;

(2)    but for incapacitating effect of a war-caused injury, the veteran would be continuing so to seek to engage in remunerative work; and

(3)    the incapacitating effect of the war-caused injury is the substantial cause of the veteran’s inability to obtain remunerative work,

then the veteran shall be treated as having been prevented, by reason of that incapacity, from continuing to undertake remunerative work that the veteran was undertaking. That is, the effect of this provision was to lessen the stringency created by the word “alone” in s 23(1)(c) of the VE Act: see, in this regard, Smith v Repatriation Commission [2014] FCAFC 53; 220 FCR 452 at [11] (Rares J) and [173] (Forster J) and [39] below.

29    Although the Tribunal held (at [56]) that it was reasonably satisfied that Mr Barnes had genuinely been seeking to engage in remunerative work (see [28](1) above], it rejected Mr Barnes’ case under s 23(3)(b) on the basis that the Tribunal was not reasonably satisfied that the incapacitating effect of his accepted conditions (in substance, his spondylosis) was the substantial cause of his inability to obtain remunerative work (see [28](3) above). (It did not specifically address [28](2)]: this was unnecessary given its finding with respect to [28](3)].)

30    The Tribunal stated as follows:

[56]    Having considered the available evidence, I am reasonably satisfied that Mr Barnes has genuinely sought to engage in remunerative work. But, I am not reasonably satisfied that incapacity from his defence-caused disabilities was the substantial cause of his inability to obtain remunerative work. The Federal Court has previously held in Fox v Repatriation Commission at 319-320:

‘The words “the substantial cause” require that, if the incapacity is not of itself productive of the inability to obtain work, it is nevertheless the operative factor which, more than any other, explains it. That something might be a “substantial cause” has regard to the situation where there may be a number of factors operating which are of sufficient causal significance to qualify as “substantial” … The definite article in s 24(2) of the 1986 Act (compare Repatriation Act 1920, Schedule 2, as amended in 1985), requires a stronger and more direct causal connexion between the incapacity and the inability to obtain remunerative work …’

[57]    In Mr Barnes' case, the evidence supports a finding that the incapacity resulting from longstanding problems with his feet is undoubtedly a substantial cause, perhaps the substantial cause, impacting his ability to continue working for the VRC and Millward Brown. These problems with his feet are distinct from and are causally unrelated to the accepted conditions relating to his feet and ankles. It therefore follows that the ameliorating provisions in section 23(3)(b) of the Act do not assist Mr Barnes.

[58]    Given that Mr Barnes' accepted conditions alone are not the only reason preventing him from continuing to undertake remunerative work, I am not reasonably satisfied that he passes the alone test. I am also therefore not reasonably satisfied that he has suffered a loss of salary or wages he would not otherwise be suffering if he were free from his accepted defence-caused injuries.

[59]    The evidence shows that incapacity arising from non-accepted conditions affecting Mr Barnes' feet was a substantial cause of his resigning from work, and remains a substantial cause of his inability to obtain work despite his genuine efforts to do so. Mr Barnes does not satisfy section 24(1)(b) or section 24(1)(c) of the Act relating to the Special Rate of pension. He is also ineligible for the Intermediate Rate of pension because he does not satisfy section 23(1)(c), or the ameliorating provisions of section 23(3)(b) of the Act. He is therefore not eligible to be paid pension at either the Special or Intermediate rates.

Appeal under section 44 of the AAT Act

31    Section 44(1) of the AAT Act provides that a party to a proceeding before the Tribunal may appeal to this Court on a question of law from a decision of the Tribunal. As we have seen, Mr Barnes appealed to this Court under s 44. An appeal under this provision is brought in the original jurisdiction of the Court.

32    Mr Barnes raised two questions of law on his appeal. First, did the Tribunal misconstrue sub-s 23(3)(b) of the VE Act by failing to address whether Mr Barnes’ accepted disabilities were the “substantial cause” of his inability to work; and secondly, did the Tribunal fail to comply with its statutory duty to give adequate and sufficient reasons for its decision in accordance with ss 43(2) and 43(2B) of the AAT Act? The respondent accepted that the first question concerned the Tribunal’s application of the correct statutory standard, and the second, the Tribunal’s performance of a statutory duty; and that, since each question raised a question of law, there was no jurisdictional difficulty.

The parties’ submissions

Mr Barnes’ submissions

33    Mr De Marchi, who represented Mr Barnes, submitted that, applying Fox v Repatriation Commission (1997) 45 ALD 317 at 319-320 (and referring to Re Bowman and Repatriation Commission (1990) 19 ALD 794 at 796-797), the Tribunal was required positively to determine the substantial cause of the veteran’s inability to engage in remunerative work and did not do so. That is, so he submitted, s 23(3) of the VE Act required the Tribunal to determine whether or not the veteran’s accepted disabilities were the substantial cause of his inability to work and it did not do so. Instead, so Mr De Marchi contended, the Tribunal identified “what ‘perhaps’ the cause might be” or whether any non-war-caused substantial causes existed. He further contended that passages at [57], [58] and [59] of the Tribunal reasons showed that the Tribunal mistakenly “was, at the most, satisfied that Mr Barnes’ non-accepted disabilities were ‘a substantial cause’ of his inability to work and that this alone disqualified the veteran”. He submitted that the Tribunal was required to (and did not) weigh up the multiple causes that it identified and make the determination required by s 23(3). In a written reply, it was submitted that “in multiple paragraphs … the Tribunal has misstated and/or misapplied the ‘substantial cause’ test” provided by s 23 of the VE Act.

34    Referring to Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 at [69], Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43; 252 CLR 480 at [54]-[55], Willis v Repatriation Commission [2012] FCA 399; 202 FCR 323 at [11] and Summers v Repatriation Commission [2015] FCAFC 36; 230 FCR 179 at [110], Mr De Marchi, for Mr Barnes, argued that the Tribunal failed to provide reasons as required by s 43 of the AAT Act. Specifically, Mr De Marchi submitted that the Tribunal reasons failed to “expose whether or not the Tribunal was satisfied that the substantial cause of [Mr Barnes’] inability to work was his war-caused disabilities”. He submitted that the Tribunal reasons did not disclose: (1) whether the Tribunal properly applied the test in Fox; (2) whether the Tribunal “believed it was sufficient to disqualify the veteran on the basis that ‘perhaps’ the substantial cause of the veteran’s inability to work was not war-caused”; and (3) whether “it was sufficient to disqualify the veteran on the basis that there were competing substantial causes that explained the veteran’s inability to work, some war-caused and others not, without analysing whether the veteran’s war-caused disabilities were the substantial cause of his inability to work”.

The respondent’s submissions

35    The respondent submitted in writing that the two questions of law raised by Mr Barnes “are really aspects of the same contention; it is that the Tribunal did not correctly apply itself to the ‘the substantial cause’ criterion in an ‘ameliorating’ provision, s 23(3)(b) of the VE Act”. Mr Smyth, counsel for respondent, also submitted at the outset of his oral submissions that “the fundamental misconception” on Mr Barnes’ part was “that it was necessary for the Tribunal to make a finding as to what was the substantial cause, rather than whether the substantial cause of the veteran’s inability to work was his accepted injuries”. He submitted that “[o]nce that is accepted as a proposition of law, both questions need to fall away in the sense that they cannot be answered favourably to” him.

36    Referring to Repatriation Commission v Woodall [2015] FCA 1267; 243 FCR 441 at [27], Fox and Re Bowman, the respondent submitted that when the Tribunal referred at [57] of the Tribunal reasons to “longstanding problems with [Mr Barnes'] feet”, it was “explaining its view that Mr Barnes’ non-‘accepted’ conditions were ‘a’ or ‘perhaps the’ substantial cause of his inability to work” and that its expression of this tentative view was helpful because it “served to illustrate why it reached the conclusion that his war-caused injuries could not be the cause”. The respondent contended that the Tribunal was not required to weigh up all the contributory causes, but rather was required to determine, as in fact it did at [56], whether it was reasonably satisfied that Mr Barnes’ accepted conditions were the substantial cause of his inability to find work.

37    The respondent contended that the Tribunal gave written reasons for its decision in accordance with its statutory duty. Specifically, it contended that: (1) it was “possible to discern that the Tribunal correctly applied Kiefel J’s reasoning in Fox”; (2) the Tribunal did not “‘disqualify’ [Mr Barnes] by use of a tentative or insufficient finding” and (3) the Tribunal did not “‘disqualify’ him on the basis that there were ‘accepted’ and ‘non-accepted’ causes in play; rather it … reached the view that his accepted conditions were not the substantial cause of his inability to work”.

Consideration

Question 1

38    As will be seen, the primary question that was raised on Mr Barnes’ notice of appeal and his submissions concerned the Tribunal’s application of s 23(3)(b) of the VE Act. Mr Barnes did not, of course, have any difficulty with the Tribunal’s finding that it was reasonably satisfied that he had genuinely been seeking to engage in remunerative work. Rather, his principal complaint was that the Tribunal failed to address the correct statutory question when considering whether or not it was reasonably satisfied that he had met the statutory requirement in s 23(3)(b) that the incapacitating effect of a war-caused injury be the substantial cause of his inability to obtain remunerative work.

39    This Court has considered on a number of occasions the operation of s 24(2) of the VE Act, which is in similar, though not identical, terms to s 23(3). Relevantly for present purposes, s 24(2)(b) is in identical terms to s 23(3)(b). Just as s 24(2)(b) “creates a beneficial easing of the impact of the word ‘alone’ in s 24(1)(c)” (Smith at [11]), so too s 23(3)(b) eases the impact of “alone” in s 23(1)(c). In Smith at [12]-[14], Rares J helpfully explained the relationship of ss 24(1)(c) and 23(3)(b) in the following terms:

If a veteran who has applied for an increase in the rate of pension under s 15 cannot satisfy the requirements of s 24(1), he or she may still be eligible for a lesser increase under s 23. That section operates in respect of a veteran who is not totally and permanently incapacitated within the meaning of s 24(1)(b), but whose incapacity has resulted in him or her being only able to undertake part-time or intermittent remunerative work….

The general scheme of s 23(1) and (2) follows that of s 24(1) but with adaptations to take account of the differing impacts of the effects of war-caused injuries that leaves a veteran with, on the one hand, some substantial capacity to engage in remunerative work (s 23) and, on the other, no, or a very minimal, capacity to do so (s 24). Thus, s 23(2) excludes a veteran who is capable of, or is actually, undertaking remunerative work for more than 50% of the ordinary time for that type of work or 20 hours per week from satisfying s 23(1)(b).

It is clear that where s 23(1)(c) repeats verbatim the terms of s 24(1)(c), the two are, nonetheless, referring to differing degrees of incapacity or effects of a war-caused injury on the veteran.

40    Where a veteran has not been engaged in remunerative work and establishes to the reasonable satisfaction of the Repatriation Commission (or, on a subsequent Tribunal review, the Tribunal) each of the three matters identified in s 23(3)(b) of the VE Act (see [28] above), then, by virtue of s 23(3)(b), the veteran is deemed to have met the second criterion in s 23(1)(c), namely, that the veteran is prevented solely by the effect of war-caused injury from engaging in the previous remunerative work.

41    The Tribunal held that Mr Barnes was unable to rely on s 23(3)(b) to ameliorate the strictness of the “alone test” (or “sole reason” test: Smith at [11]) because he did not establish to the Tribunal’s reasonable satisfaction that the incapacitating effect of his accepted war-caused injury was the substantial cause of his inability to obtain remunerative work (at [56]).

42    The Court in Woodall and Fox specifically considered the meaning and effect of the expression “the substantial cause” in s 24(2)(b). In Woodall at [27], Tracey J stated, correctly in my view, that the requirement that the veteran’s war-caused incapacity must be “the substantial cause” of his inability to obtain remunerative work “clearly recognises that factors, additional to war-caused injury, may impede a veteran who is seeking to obtain employment”. Just as the Tribunal did in this case (at [56]), his Honour also referred to Kiefel J’s statement in Fox at 45 ALD at 319-320; 24 AAR at 529.

43    In Fox, Kiefel J relevantly said that:

The words “the substantial cause“ require that, if the incapacity is not of itself productive of the inability to obtain work, it is nevertheless the operative factor which, more than any other, explains it. That something might be “a substantial cause” has regard to the situation where there may be a number of factors operating which are of sufficient causal significance to qualify as “substantial”… The definite article in s 24(2) … requires a stronger and more direct causal connection between the incapacity and the inability to obtain remunerative work. The tribunal here was clearly of the view that whilst the applicant’s incapacity could be described as “substantial” the other factors, which it listed, were also of importance with respect to the applicant’s inability to obtain work. Since their effect was considered of such significance to deny his incapacity status as “the substantial cause”, one infers the tribunal considered that they might also be described as a substantial cause or causes. It seems to me, therefore, that the tribunal did not suffer from any misapprehension as to the meaning to be given to the words “the substantial cause” in the subsection.

44    Having regard to the authorities (some of which are mentioned above) and the Tribunal’s reasons, I reject Mr De Marchi’s submission that the Tribunal did not make a determination as to its reasonable satisfaction about whether or not one or other or all of Mr Barnes’ accepted conditions were “the substantial cause” of his inability to obtain remunerative work.

45    In considering the alleged error, the Tribunal’s reasons must be read fairly and as a whole: see Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; 185 CLR 259 at [31] and Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287. The Court must not read the Tribunal’s reasons with an eye keenly attuned to the perception of error. In this case, one must consider the significant parts of the Tribunal’s reasons and how they bear on the alleged error.

46    In its reasons at [56], the Tribunal expressly made the determination that Mr De Marchi submitted had to be made in Mr Barnes’ case when it said “I am not reasonably satisfied that incapacity from his defence-caused disabilities was the substantial cause of his inability to obtain remunerative work”. The Tribunal clearly addressed the correct statutory question of whether it was reasonably satisfied that the incapacitating effect of war-caused injury was the substantial cause of the veteran’s inability to obtain remunerative work.

47    Further, in so far as Mr De Marchi submitted that the Tribunal did not make this determination in the way required by the VE Act, it seems to me that this submission also fails. The Tribunal’s reasons disclose that it made a careful analysis of the evidence before it, including the relevant medical evidence.

48    It may be recalled that before turning to the issues raised by s 23(3)(b) towards the close of its reasons, the Tribunal had earlier made a detailed and apparently careful analysis of the medical evidence regarding each of Mr Barnes’ accepted conditions (at [28]-[33]) and non-accepted conditions (at [34]-[37]) and stated that it preferred the opinion of Dr Horsley to that of Dr Prestage and the other physicians, for the reasons it gave at [42]. Having analysed the evidence in this way, the Tribunal made a number of findings (at [43]), including that it accepted Dr Horsley’s opinion that his neck and back condition limited Mr Barnes’ capacity to work to between eight and 20 hours per week; that it was not reasonably satisfied that his sleep apnoea continued to affect his capacity to undertake remunerative work in a substantial way; that the non-accepted conditions affecting Mr Barnes' feet (Plantar Fasciitis and Sinus Tarsi Syndrome) were a substantial factor in his incapacity; and that his other “accepted” and “non-accepted” conditions (right ankle, solar skin damage, sensorineural hearing loss and tinnitus, deviated nasal septum, shoulder and knee conditions) were not significant causal factors in his decision to cease remunerative work. Consistently with its findings at [43], the Tribunal subsequently recorded that Mr Barnes met the requirement in s 23(1)(b). Its findings plainly show that it was reasonably satisfied that, by reason of his accepted condition of spondylosis alone, he was incapable of working “otherwise than on a part-time basis or intermittently”, within the meaning of s 23(1)(b).

49    The Tribunal returned, at [50]-[51], to Mr Barnes’ evidence and the medical evidence before finding, for the purposes of s 23(1)(c), that the non-accepted conditions, Plantar Fasciitis and Sinus Tarsi Syndrome, contributed significantly to his inability to continue working at the VRC and Millward Brown (at [53]). As already noted, this meant that Mr Barnes was unable to satisfy s 23(1)(c) directly unless he could satisfy s 23(3). It may also be noted that the Tribunal had earlier held that the decision of the VRB to accept pes planus right foot and left foot sprain did not establish a causal relationship between his accepted conditions and the Plantar Fasciitis/Sinus Tarsi Syndrome.

50    The fact that the Tribunal plainly identified the correct approach in making this determination is confirmed by its immediately subsequent reference to the passage in Fox (set out at [43] above).

51    The Tribunal’s determination at [56] (that it was not reasonably satisfied that Mr Barnes’ incapacity from his defence-caused disabilities was the substantial cause of his inability to obtain remunerative work) flowed in large part from its previously-stated analysis of the evidence before it. This is confirmed by the Tribunal’s own reference in [56] to the “available evidence”. In its previous analyses of the evidence, the Tribunal had identified more than one substantial factor limiting Mr Barnes’ capacity to obtain remunerative work: they were his accepted neck and back condition (spondylitis) and the non-accepted conditions of Plantar Fasciitis and Sinus Tarsi Syndrome. It had also identified the correct approach in making a determination about “the substantial cause” of a veteran’s inability to obtain remunerative work in such circumstances when it made reference to Fox.

52    In arguing to the contrary, Mr De Marchi emphasised the Tribunal’s additional comments in [57] of its reasons. These comments do not, however, detract from the significance of the finding in [56]. The Tribunal’s statements at [57], which were apparently designed to clarify why the Tribunal was unable to reach the requisite state of reasonable satisfaction about the accepted neck and back condition (spondylitis), must be understood in light of the Tribunal’s earlier-stated evidentiary analyses. The Tribunal was effectively confirming that it could not be reasonably satisfied because, on the evidence before it, the non-accepted conditions of Plantar Fasciitis and Sinus Tarsi Syndrome could also be characterised as a substantial cause or causes of his inability to obtain remunerative work. That is, these non-accepted conditions were of such significance as to deny his accepted neck and back condition the status of “the substantial cause”.

53    I accept that, as the respondent submitted, the Tribunal was not required in this case to decide whether the accepted condition was more causally dominant than the non-accepted conditions. One may infer from the Tribunal’s reasons, especially at [57], that the evidence did not permit such a ranking to be made. The Tribunal was required to determine on the evidence before it whether or not it was reasonably satisfied that Mr Barnes’ accepted conditions were the substantial cause of his inability to obtain remunerative work, which it did. There is no relevant error here.

54    For these reasons, I would answer the first question raised by Mr Barnes in the negative and reject the related ground of appeal.

Question 2

55    A failure to state reasons for a decision where a statement of reasons is a requirement of the exercise of the decision-making process constitutes an error of law: see Summers at [110]. I am not, however, persuaded that the Tribunal failed in its duty to provide reasons for its decision, as required by s 43 of the AAT Act.

56    Section 43(2) provides that, subject to certain provisions in the AAT Act, the Tribunal shall give reasons either orally or in writing for its decision. The specifics of the Tribunal’s duty to provide reasons for its decision are contained in s 43(2B) of the AAT Act. This provision relevantly states:

Where the Tribunal gives in writing the reasons for its decision, those reasons shall include its findings on material questions of fact and a reference to the evidence or other material on which those findings were based.

57    In Yusuf the High Court considered the adequacy of the reasons of the Refugee Review Tribunal in the context of s 430 of the Migration Act 1958 (Cth). This provision is analogous to s 43(2B) of the AAT Act. The plurality (McHugh, Gummow and Hayne JJ, with whom Gleeson CJ agreed) stated (at [68]) that the Tribunal would have discharged its obligation under s 430 if it “set out its findings on those questions of fact which it considered to be material to the decision which it made and to the reasons it had for reaching that decision” (emphasis in original). Their Honours observed that the “requirement to set out findings and reasons focuses upon the subjective thought processes of the decision-maker”. In Wingfoot at [55] the High Court adopted much the same approach when considering the duty of a medical panel to provide a written statement of reasons for its decision under s 68(2) of the Accident Compensation Act 1985 (Vic). 

58    In Summers, a Full Court of this Court stated (at [110]) that “[o]ne of the central objects behind the statutory obligation to give reasons is to expose the tribunal’s reasoning process which may facilitate appeals on a question of law or judicial review”. In Willis, to which reference was also made at the hearing in this Court, Bromberg J adopted a similar approach when considering s 43(2B) of the AAT Act (at [11]-[17]). His Honour found that the Tribunal had failed to discharge its duty to provide reasons where there was “a failure to identify findings of fact which underlie those conclusions, including a failure to explain the evidence accepted or rejected” and “a failure to expose the reasoning process which led to the conclusions reached in a manner sufficient to enable the parties and the Court to understand” the Tribunal’s reasoning (at [45]).

59    Overall, the Tribunal’s reasons in the present case were relatively detailed and thorough. They were separated by clear headings under which it addressed distinct topics, including the legislative framework, the identification of the issues before the Tribunal, the evidence before the Tribunal, with particular reference to Mr Barnes’ spondylosis, sleep apnoea, old fracture of the right malleolus (ankle), and other accepted conditions and non-accepted conditions. Under the heading of “consideration”, the Tribunal addressed separately the questions, “[i]s Mr Barnes entitled to [a] pension at either the Special or Intermediate Rate?”, “[d]oes Mr Barnes’ defence-caused incapacity alone render him incapable of undertaking remunerative work for the periods necessary to qualify for either rate of pension?” and, lastly, “[d]oes Mr Barnes’ defence-caused incapacity of itself alone prevent him from continuing to undertake remunerative work that he was undertaking and is he thereby suffering a loss of income that he would otherwise not be suffering?”. Under the last-mentioned heading, the Tribunal considered whether either of ss 23(1)(c) or 23(3)(b) was satisfied in Mr Barnes’ case.

60    As already stated, the Tribunal’s reasons made detailed reference to the evidence on which its findings were based: see AAT Act s 43(2B). It set out its reasons for reaching its decision for the findings that it considered material to its decision. In substance, the Tribunal’s reasons showed the basis on which the Tribunal was or was not reasonably satisfied that Mr Barnes satisfied the relevant statutory requirements for a pension at the special or intermediate rate. It explained the “actual path of reasoning” by which it in fact arrived at its decision “in sufficient detail” to allow a court to see whether or not the decision involved a relevant error (Wingfoot at [55]).

61    For these reasons, the second question raised by Mr Barnes should be decided against him and the related ground should be rejected.

A further matter

62    Although not raised in Mr Barnes’ notice of appeal or in the written submissions or oral submissions in chief made on his behalf, Mr De Marchi, for Mr Barnes, in reply drew attention to what he perceived to be a difficulty with the Tribunal’s reasons at [58] (set out at [30] above). It is, however, apparent that [58] contains no discernible error.

63    Paragraph [58] follows upon the Tribunal’s finding at [56] (that it was not reasonably satisfied that the incapacitating effect of Mr Barnes’ war-caused injury or injuries was the substantial cause of his inability to obtain remunerative work), its attempt to clarify that finding and its conclusion at [57] that “the ameliorating provisions in s 23(3)(b) ... do not assist Mr Barnes”. The effect of this conclusion was that Mr Barnes could not rely on s 23(3)(b) to ameliorate the effect of the word “alone” in s 23(1)(c). It is to the “alone test” in s 23(1)(c), therefore, that the Tribunal returns at [58]. It is in this context that the Tribunal stated that it was not reasonably satisfied that Mr Barnes passed that test since his accepted conditions were “not the only reason preventing him from continuing to undertake remunerative work”. This latter statement may be first referenced to the Tribunal’s earlier finding at [53] that it was “reasonably satisfied” that Mr Barnes’ non-accepted conditions – Plantar Fasciitis and Sinus Tarsi Syndrome – contributed significantly to his inability to continue working at the VRC and Millward Brown. It followed from the fact that Mr Barnes could not satisfy s 23(1)(c) directly or indirectly (by satisfying s 23(3)(b) of the VE Act) that the Tribunal could not be reasonably satisfied, as it concluded at [58], that Mr Barnes (in the language of s 23(1)(c)) had “suffered a loss of salary or wages he would not … be suffering if he were free from his accepted defence-caused injuries”.

64    Although the Tribunal might have expressed itself differently at [58], by expressly stating that it was returning to s 23(1)(c), the Tribunal’s reasoning is clear enough when regard is had to the relationship between ss 23(1)(c) and 23(3)(b) of the VE Act. The possibility that there might have been “fuller and more detailed discussion” is not sufficient to establish a breach of the Tribunal’s obligation under s 43(2B) of the AAT Act: see Commissioner of Taxation v Osborne (1990) 26 FCR 63 at 65; 95 ALR 654 at 656.

Disposition

65    For the reasons stated above, Mr Barnes’ appeal under s 44 of the AAT Act should be dismissed.

Associate:    

Dated:    16 October 2019