Federal Court of Australia

Rushton v Commonwealth Superannuation Corporation (No 3) [2021] FCA 358

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    The applicant pay the first and second respondents’ costs.

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

REASONS FOR JUDGMENT

RARES J:

1    Ben Rushton, the applicant, appeals under s 1057(1) of the Corporations Act 2001 (Cth) against the decision of the third respondent, the Australian Financial Complaints Authority dated 4 December 2019 to affirm the decision of the first respondent, the Commonwealth Superannuation Corporation (the trustee) made on 13 October 2016 (the second trustee decision). The second trustee decision set aside its original determination made on 4 May 2015 and instead found that Mr Rushton did not meet the requirements for a spouse pension under the Public Sector Superannuation Scheme Trust Deed, as amended, made pursuant to s 4 of the Superannuation Act 1990 (Cth) (the trustee’s decision). The deed attached a schedule comprising the rules for the administration of the superannuation scheme. The trustee declined to reconsider that determination on 14 December 2017. Subsequently, Mr Rushton lodged a complaint with the Authority on 6 December 2018.

2    Mr Rushton claimed that he was entitled to a reversionary pension under rr 7.1.1 and 9.3.2 as the spouse of a deceased member, being his late wife, Kelli Rushton (the deceased). The deceased died on 11 April 2015. To qualify, he had to establish that he met one or other limb of the definition of “spouse” in r 1.2.1, namely:

spouse in relation to a deceased member… means:

•    another person who had a marital or couple relationship with the deceased person at the time of the deceased person’s death; or

•    another person who did not have a marital or couple relationship with the deceased person at the time of the deceased person’s death but who had previously had a marital or couple relationship with the deceased person, and:

•    at the time of the deceased person’s death, that other person was legally married to the deceased person; and

•    in the opinion of CSC, that other person was wholly or substantially dependent upon the deceased person at the time of the deceased person’s death.

(emphasis in original)

3    Thus, for Mr Rushton to qualify for a reversionary pension under r 7.1.1, he had to fall within one or other limb of the meaning of “spouse”, which required him to establish that at the time of his wife’s death he had either a marital or couple relationship with her (the existing relationship issue) or previously had such a relationship and was both still legally married (which he was) and, in the opinion of the CSC, he was wholly or substantially dependent on her (the dependency issue).

4    The second trustee decision reversed the trustee’s earlier grant of partial pensions to both Mr Rushton and the three young, dependent children of the marriage and instead increased the benefits paid to the children.

The provisions of the trust deed

5    The deed provided that where the context required or admitted, words and expressions defined in the Act and rules had the same meaning when used in deed but that the headings in the deed and rules were for the convenience of reference only and will not affect in their interpretation (cl 1.2). The rules defined the trustee as “CSC”.

6    Rule 1.2.1 also set out definitions, relevantly, of deceased member and marital or couple relationship:

deceased member means a member who died before ceasing to be a member…

marital or couple relationship means a relationship at a particular time between a member… and another person, whether or not they were legally married to each other at the time of the relationship, under which they had been living with each other:

•    as husband and wife, spouses, or partners, on a permanent and bona fide domestic basis for a continuous period of at least 3 years up to that time; or

•    for a continuous period of less than 3 years up to that time but, in the opinion of CSC, were living with each other as husband and wife, spouses, or partners, on a permanent and bona fide domestic basis at that time, having regard to any evidence relevant in that respect, which includes evidence establishing any of the following:

•    that the other person was wholly or substantially dependent on the member…

•    that they were legally married to each other;

•    that the relationship was registered under a law of a State or Territory prescribed for the purposes of section 22B of the Acts Interpretation Act 1901, as a kind of relationship prescribed for the purposes of that section;

•    that a child was born of the relationship or was adopted during the period of the relationship;

•    that there is a child of both of the persons within the meaning of the Family Law Act 1975;

•    that they jointly owned a home which was their usual residence;

•    any other matters that CSC considers relevant.

Despite the definition of ‘spouse’ in Rule 1.2.1, the reference to spouse in this definition is a reference to spouse within the meaning of section 2CA of the Acts Interpretation Act 1901.

(emphasis in original)

7    Rule 7.1.1 provided:

7.1.1    The death benefit accrual in relation to a deceased member who is survived by a spouse is payable as a reversionary pension (see Rule 9.3.2).

(emphasis in original)

8    The annual reversionary pension apportionable between a spouse and eligible children following the death of a member had to be calculated in accordance with r 9.3.2, which set out a formula for doing so. The trustee had to apportion a reversionary pension under r 9.4.1 and could refer its decision to a reconsideration advisory committee under r 13.3.7 if a person affected by the decision sought reconsideration of it under r 13.3.1. Requests for reconsideration are dealt with in rr 13.3.1–13.3.3 which provided, relevantly, that the request had to include new evidence not previously known to the trustee that, in its opinion, supported the grounds for the request.

The statutory context

9    The Acts Interpretation Act 1901 (Cth) provides in s 2CA:

2CA     References to spouses

(1)     For the purposes of any Act, a person is the spouse of another person (whether of the same sex or a different sex) if the person is legally married to the other person.

(2)     Subsection (1) has effect in addition to any provision of an Act that affects the meaning of spouse in a provision of that Act.

Example: Spouse is defined for the purposes of an Act to include a de facto partner and a former spouse. Because of this section, a reference in the Act to a person's spouse covers any person who is legally married to the person, in addition to any person covered by the definition in the Act.

10    The Corporations Act provides that a person may make a complaint to the Authority (defined as AFCA) relating to superannuation under the AFCA scheme, being the external dispute resolution scheme authorised under Pt 7.10A (see the definitions in s 761(a)). Relevantly, if the complaint is that the trustee of a regulated superannuation fund (such as the trustee here) has made a decision relating to a particular member or former member of the fund that is or was unfair or unreasonable (s 1053(1)(a)), the Authority has, subject to s 1055, all of the powers, obligations and discretions conferred on the trustee who made the decision to which a complaint relates. Relevantly, s 1055(3) and (5) provide:

1055     Making a determination

(3)      AFCA must affirm a decision relating to the payment of a death benefit if AFCA is satisfied that the decision, in its operation in relation to:

(a)      the complainant; and

(b)     any other person joined under subsection 1056A(3) as a party to the complaint;

was fair and reasonable in all the circumstances.

(5)      If AFCA is satisfied that a decision relating to the payment of a death benefit, in its operation in relation to:

   (a)      the complainant; and

(b)      any other person joined under subsection 1056A(3) as a party to the complaint;

is unfair or unreasonable, or both, AFCA may take any one or more of the actions mentioned in subsection (6), but only for the purpose of placing the complainant (and any other person so joined as a party), as nearly as practicable, in such a position that the unfairness, unreasonableness, or both, no longer exists.

11    The Authority has power under s 1055(6) to vary, set aside and substitute a decision or remit the matter to the decision-makers, but must not make a determination that would be contrary to law (s 1055 (7)). The Authority must give reasons for its decision (s 1055A)

Background

12    The deceased was a person who was still a member of the scheme when she died on 11 April 2015 and, accordingly met the definition of a “deceased member”. Importantly, as I have noted above, the definition of “spouse” expressly applied “in relation to a deceased member”.

13    Mr Rushton and his late wife married in February 2005. In 2011, the deceased was diagnosed with breast cancer. In February 2012 Mrs Rushton applied for and was granted a carer allowance. In the application for that allowance she stated that she was separated.

14    On 28 February 2014, Mr Rushton was removed from the deceased’s home at Scarborough, Queensland. On 6 March 2014, the Queensland Magistrates Court granted, on the deceased’s application, an intervention order against Mr Rushton. In that application, the deceased said that the relationship was over and that she feared for the lives of herself and her children.

15    On 6 March 2014, she applied for a domestic violence crisis payment to meet costs of securing the home due to the family violence incident and again stated, in that application, that she was separated.

16    On 28 March 2014, the deceased retired from her employment on medical grounds. The trustee paid her a part pension and a part lump sum under the scheme.

17    On 22 May 2014, the deceased telephoned the trustee helpline and enquired about the distribution of her death benefit. On the call, she said that her marital status was single and she wished the death benefit to be paid to her children. The helpline told her that it would note her marital status but she could not nominate a beneficiary because that would be determined after she had tied. During the call she also told the helpline that she was separated and owned her property. She said that Mr Rushton had made no contributions to the property, that he had been out of work for 4 years and that “I’ve been supporting him”.

18    The Magistrates Court varied the intervention order on 10 June 2014 and on 22 July 2014 granted the deceased a protection order to prevent Mr Rushton approaching her home or work.

19    On 25 July 2014, the deceased executed her last will under which she appointed as executors her mother and brother, the second respondent, Mark Kaney. She devised to Mr Rushton the right to live in the Queensland home until he formed a domestic relationship. She expressed the wish that any superannuation entitlement would be paid into her estate and be dealt with in the same way as her other bequests that left her net estate to the children.

20    On 13 October 2014, Mr Rushton commenced proceedings in the Federal Circuit Court in which he stated that 28 February 2014 was the date of final separation of parties to the marriage.

21    In December 2014, the deceased and her children moved to a house in Canberra, having sold the Scarborough home. Mr Rushton appears to have moved to Canberra at about the same time and resided with his parents. Until she died, Mr Rushton appears to have provided full time care for the deceased and the children at her home.

22    On 16 February 2015, Mr Rushton applied to Centrelink for a carer allowance to enable him to care for the deceased.

23    Mr Rushton telephoned the helpline on 14 April 2015 and told the trustee that his wife had died on 11 April 2015. He enquired about how to transfer her superannuation. He said that he did not reside at her Canberra address and gave the trustee his Canberra post office box address. He answered the helpline’s question “so [you] weren’t separated or anything like that” by saying “No, we’re still married”.

24    On 20 April 2015, Centrelink notified Mr Rushton that it had granted him the carer allowance with effect from 16 February 2015.

25    On 24 April 2015, Mr Rushton applied to the trustee for a reversionary pension as a spouse of a deceased pensioner. In the form he said that he was not living with the deceased at the time of her death. He answered questions stating that they had separated on 29 March 2015 due to illness and for a period of not more than 30 days. He answered “no” to the question asking if he or his wife had ever taken action in the Family Court to dissolve their marriage. That answer was true because, incredibly, the form did not ask about the action in the Federal Circuit Court which has had the same jurisdiction to dissolve marriages as the Family Court for over 20 years. Mr Rushton did not give any answer to question 12. It asked if he was financially dependent on the deceased and, if so, required that he attach documentary evidence.

26    On 1 May 2015, the trustee determined that the three children were eligible children under the rules and granted them a reversionary pension.

27    On 4 May 2015, the trustee determined that Mr Rushton was an eligible spouse under the rules and granted him a reversionary pension (the first trustee decision).

28    On 7 May 2015, Ruth Carter, a social worker with Calvary Healthcare ACT, wrote a letter about Mrs Rushton (the Calvary letter). Ms Carter said that she was responsible for responding to referrals for the home based palliative care program. She wrote that the program began supporting the deceased and her family on 20 December 2014. Ms Carter said that the deceased had recently moved to Canberra with her three children “in order to be further supported by her husband Ben and their extended family and friends that resided in Canberra.” Ms Carter said that at that time she understood that Mr and Mrs Rushton had been separated for about 6 months and that he was not residing in the family home, but lived nearby. She said that the program’s multidisciplinary team provided ongoing support for the deceased from 20 December 2014 on a regular basis and that team members had confirmed that Mr Rushton attended the home on a daily basis, “from very early in the morning until late in the evening”. She wrote in detail about the many tasks that the team observed that Mr Rushton performed in caring for the deceased and their children up to her death. She concluded that: (tab 191)

It was obvious to our multidisciplinary team that whilst Kelli [the deceased] was a patient on [the program], Ben Rushton was very much a full time carer to Kelli and their 3 children.

29    On 14 July 2015, the deceased’s brother made an objection to, and sought reconsideration of, the first trustee decision.

30    On 24 September 2015, the Family Court awarded custody of the children to the brother.

The second trustee decision

31    On 13 October 2016, the reconsideration committee of the trustee set aside the first trustee decision and found that Mr Rushton did not satisfy the requirements to be an eligible spouse under the rules (the second trustee decision).

32    The committee recorded that it had material before it that included financial documents. That material included evidence that Mr Rushton and the deceased did not have any joint accounts, assets or liabilities, and bank statements that indicated her receipt of a modest weekly child support payments from 13 June 2014 until her death. The committee also had the Calvary letter before it and a letter from the deceased’s lawyer concerning her will, property settlement and divorce proceedings.

33    The Committee was not satisfied that Mr Rushton had lived with the deceased for a continuous period of at least 3 years prior to her death. It also found that Mr Rushton had said in his application form that he was not living with the deceased at the time of her death due to an illness, hospitalisation or long term medical care. The committee said that it:

… had regard to the available documentary evidence which supported that Mrs Rushton was part of a Home Based Palliative Care Program, and remained living in her residence… up until her death.

34    It found that Mr Rushton was not living with the deceased leading up to or at the time of her death, and so he did not satisfy the first limb of the definition of spouse in r 1.2.1 that he was in a marital or couple relationship at that time.

35    The committee found that Mr Rushton had not provided any financial information or documentary evidence demonstrating that he was wholly or substantially dependent on the deceased at the time of her death or that they shared expenses, liabilities or loans or had joint finances. Accordingly, it formed the opinion that he was not wholly or substantially dependent on the deceased at the time of her death and so did not satisfy the second limb of the definition of spouse in r 1.2.1. As Mr Rushton did not qualify for a benefit, the trustee granted the children, who were financially dependent on their late mother, a higher benefit.

36    On 3 April 2017, Mr Rushton lodged a request for the trustee to reconsider the second trustee decision. On 13 December 2017, the trustee declined to reconsider that decision because Mr Rushton had not met the criteria for that to occur, namely, he had not provided any new evidence.

37    On 6 December 2018, Mr Rushton made a complaint to the Authority which is the subject of this appeal.

The Authority’s decision

38    On 4 December 2019, the Authority determined, relevantly, that the second trustee decision was fair and reasonable in its operation in relation to Mr Rushton and the three children in all the circumstances. The Authority had joined the children as parties to the complaint in accordance with s 1056A of the Corporations Act. The Authority stated that, under the Act, the issue for it was not what decision it would have made but whether the decision under review was fair and reasonable, based on the information that it had.

39    The Authority found that there was no dispute that Mr Rushton has provided care to his late wife, but he was not her exclusive carer. It found, referring to the evidence before it, that the deceased had agreed to Mr Rushton caring for her in the last months of her life to enable the children to build relationships with him because she understood that he would be given custody of them when she died. It found that Mr Rushton and the deceased had been separated and lived in separate residences in both Queensland and Canberra. The Authority referred to the formal separation on 28 February 2014 and the deceased obtaining the intervention order soon after. It noted that the deceased had completed government forms stating that she was separated and had changed her will in July 2014 to bequeath her estate only to the children. It found that, after Mr Rushton discovered that his wife had changed her will, he had filed an application in the Family Court in which he also stated that the couple had separated on 28 February 2014.

40    The Authority found that on his return to Canberra in December 2014, Mr Rushton lived with his parents and not with the deceased. It concluded that there was no evidence that they had any shared financial assets or commitments or had a commitment to a shared life together. It found that their family, friends and the palliative care staff supporting the deceased all accepted that Mr Rushton and the deceased were separated.

41    The Authority said that it was necessary to assess the relationship as a whole. It found that the fact that the parties were legally married and that Mr Rushton provided care was not sufficient. It was not satisfied that, at the date of her death, he and the deceased were living in a marital or couple relationship and that, accordingly, Mr Rushton did not satisfy the first limb of the definition of “spouse”.

42    Next, the Authority found that there was no evidence that, after the separation, the deceased provided any financial support to Mr Rushton or that he was wholly or substantially dependent on her at the date of her death. Indeed, it said that the only evidence of dependence supported a conclusion that the deceased may have been partly dependent on Mr Rushton, who was paying her a small amount as child support. The Authority did not accept that the provision of care by, or the payment of a carer’s allowance to, Mr Rushton brought him within the second limb of the definition of a “spouse”.

43    The Authority also found that the trustee had acted in accordance with the rules in determining in the second trustee decision that the children were entitled to an orphan (scil: eligible child) benefit and that this decision accorded with “the overall purpose of superannuation to provide for those who would have looked to the deceased for financial support”, namely the children for whose benefit the deceased had restructured her affairs during her final illness.

44    The Authority considered that the first trustee decision may have been made because of the poor design of the spouse pension application form that the trustee had issued. It noted that the form did not require elaboration where it asked if the applicant had lived apart from the deceased member due to hospitalisation for less than 30 days. As I have noted above, that was not the only problem with the poorly drafted form.

45    The Authority found that Mr Rushton did not satisfy either limb of the definition of “spouse” in r 1.2.1 because, at the time of her death, first, he was not living with the deceased at the time of her death as husband and wife on a permanent and bona fide domestic basis within the meaning of “marital and couple relationship” and, secondly, he was not wholly or substantially dependent on her. It found that the second trustee decision was reasonably open to the trustee, made in accordance with the rules, and fair and reasonable in its operation in relation to Mr Rushton and the children in the circumstances.

46    The Authority found that the only new evidence that Mr Rushton had provided to the trustee to advance his submission that it reconsider the second trustee decision, namely that he had been granted a carer’s allowance and his lengthy affidavit, did not support his claim to satisfy the definition of spouse under the rules. Accordingly, the Authority did not interfere with the trustee’s refusal to reconsider the second trustee decision.

Mr Rushton’s submissions

47    In his amended notice of appeal, Mr Rushton challenged the Authority’s resolution of his complaint in respect of the second trustee decision. He contended that the Authority had erred in finding that he was not a “spouse” within the meaning of each limb of the definition of that word in r 1.2.1. He sought that the Authority’s decision be set aside and that the Court make declarations that he was entitled to receive a reversionary pension as the spouse of the deceased under rr 7.3.1 and 9.3.5. He contended that the definition of “spouse” inserted into the Acts Interpretation Act on 9 December 2017 (that extended “spouse” to include marriage of two persons of the same sex) was not in force when the trustee made the first trustee decision and could not authorise the making of the second trustee decision.

48    Mr Rushton argued that because he took care of his wife and children in Canberra in the four months before her death, in the circumstances described above, the Authority should have determined that it was fair and reasonable to find that he and she were in a marital or couple relationship then and that he fell within the first limb of the definition of ‘spouse’ in r 1.2.1. He also contended that, for the reasons he had argued before the Authority, he was wholly or substantially dependent on the deceased at the time of her death.

49    The trustee and the brother (as guardian of the children) opposed the appeal. The brother largely adopted the trustee’s submissions.

Consideration

50    The hearing by the Authority is de novo: Mercer Superannuation (Australia) Ltd v Billinghurst (2017) 255 FCR 144 at 155 [32] per Flick, Kerr and Pagone JJ. The determining factor for the exercise of the Authority’s powers under s 1055(3) is not the lawfulness of the trustee’s decision, but its fairness and reasonableness in its operation in relation to the complainant and any joined person: QSuper Board v Australian Financial Complaints Authority (2020) 276 FCR 97 at 113 [64] per Moshinsky, Bromwich and Derrington JJ. However, s 1055(7) requires that, if it grants a remedy under s 1055(5), the Authority must exercise the powers of the trustee within legal confines and does so in accordance with the terms of the trust deed and any applicable statutory provisions: QSuper 276 FCR at 113 [65].

51    The Authority had to determine whether the second trustee decision was fair and reasonable in its operation in relation to Mr Rushton and the children, in respect of its resolution of, first, the existing relationship issue and, secondly, the dependency issue, in accordance with the first and second limbs of the definition of “spouse”.

The existing relationship issue

52    The existing relationship issue required attention to the definition in r 1.2.1 of “marital or couple relationship”. In order for Mr Rushton to be eligible for a spouse pension under the second alternative in that definition, the deceased and Mr Rushton, who were legally married to each other, had to be, at the time of her death, in a relationship under which they had been living with each other “as husband and wife… on a permanent and bona fide domestic basis at that time, having regard to any evidence relevant in that respect”.

53    The amendments to s 2CA of the Acts Interpretation Act had no relevance to the construction of the rules as they applied to the relationship between Mr Rushton and the deceased. That is because they were legally married at all times up to her death. Therefore, they were always “spouses” as defined in s 2CA and in the natural and ordinary English meaning of “spouse”, but that was not determinative of whether they were spouses within the definition of “spouse” in r 1.2.1.

54    At common law, a conclusion that a husband and wife are “living together” or living with each other involves a consideration of whether consortium continues between them: Rex v Creamer [1919] 1 KB 564 at 569. There, Darling, Avory, Lush, Shearman and Sankey JJ said:

A husband and wife are living together, not only when they are residing together in the same house, but also when they are living in different places, even if they are separated by the high seas, provided the consortium has not been determined. In this case it cannot be said that at the time the wife took the money the consortium had been determined, because the wife had not at that time committed adultery, and therefore it is little to the purpose to point to the fact that the wife was living at Folkestone and the husband was in France on service with the Army. In the legal sense they were still living together.

(emphasis added)

55    However, society and social norms have changed in the century since that decision: see the discussion of who could be a member of a tenant’s family in Fitzpatrick v Sterling Housing Association Ltd [2001] 1 AC 27 at 39B–40F per Lord Slynn of Hadley, 46A–47A per Lord Nicholls of Birkenhead, 47G–48A per Lord Clyde.

56    In Roy v Sturgeon (1986) 11 NSWLR 454 at 458F–G, Powell J said that the determination of whether persons are living together as husband and wife on a bona fide domestic basis cannot be determined by a priori rules to establish whether a particular element is or is not present. He said, correctly, that as human personalities and needs vary markedly, so also various aspects of their relationships will vary from case to case in which a decision-maker is required to make a finding as to whether two persons were living together as husband and wife on a bona fide domestic basis.

57    A completely satisfactory definition of the concept intended to be conveyed by expressions such as “living with each other”, “living with” or “living together” in a domestic relationship has proved elusive, as shown by how the House of Lords grappled with statutory attempts in Gubay v Kingston (Inspector of Taxes) [1984] 1 WLR 163. A platonic relationship or a caring friendship ordinarily will not be within the concept of such a relationship. In Fitzpatrick [2001] 1 AC at 40F–G, Lord Slynn, in discussing whether the parties to a same sex relationship could be a “family” within the meaning of a statute, said that a transient, superficial relationship, even if intimate, would not suffice and nor would mere cohabitation of friends as a matter of convenience: see too at 47G–48A per Lord Clyde.

58    In Main v Main (1949) 78 CLR 636 at 642–643, Latham CJ, Rich and Dixon JJ explored considerations that went to whether there was at a specified date an existing matrimonial relationship after the couple had lived separately and apart for a lengthy period (there, over 5 years). The husband became paralysed and was a complete invalid, who had to live in a facility to care for him. The wife paid a contribution from her wages for his maintenance. Their Honours said that absences between spouses, even for long periods, did not mean that the mutual recognition of the marital relationship would cease to exist. However, because of the permanence of the husband’s physical and mental incapacity to live his former life, their Honours said at 643:

Both must have known that the resumption of a common home, of a marital association, was out of the question. There was no prospect of its ever being possible. The contribution by the wife may mean that she recognized a legal or moral obligation. It does not mean that she recognized the subsistence of a conjugal relation and treated the suspension of a common life as only temporary.

(emphasis added)

59    In any event, the rules are not concerned exclusively with whether married or other couples are only “living with each other” or “living together”, but with the wider concept of a “marital or couple relationship”.

60    I am of opinion that the expression “living with each other” in the definition of “marital or couple relationship” in the rules comprehends the relevant couple having a domestic relationship in which each party enjoys, mutually, the “society” of the other: cf Toohey v Hollier (1995) 92 CLR 618 at 627–629 per Dixon CJ, McTiernan and Kitto JJ. This requires the decision-maker under the rules (the trustee and the Authority in dealing with a complaint) to consider the nature and incidents of the parties’ relationship, including their expressed perceptions of it, by having regard to “any evidence relevant in that respect”, including, when relevant, the factors set out in the second alternative in the definition of marital or couple relationship. For example, if one party to a relationship does not regard or treat it as subsisting, such as where a couple live in the same accommodation but agree, or one of them insists, that each or the one will conduct their lives separately and independently of the other, ordinarily it would be difficult to characterise that as them “living with each other as husband and wife, spouses or partners, on a permanent and bona fide domestic basis”. Likewise where one party stays or places himself or herself in the position of “living with” the other because of a sense of moral or legal obligation but without a sense of mutual commitment to the other, it is unlikely that their relationship could be characterised as falling within the definition of a marital or couple relationship: Main 78 CLR at 643.

61    In arriving at a finding as to whether Mr Rushton was in a marital or couple relationship with the deceased at the time of her death, the Authority had to have regard and give fundamental weight in its decision-making to relevant evidence, including any evidence bearing on whether Mr Rushton was wholly or substantially dependent on his wife, they were legally married (which they were), there was a child of both of them within the meaning of the Family Law Act (which there was, being the couple’s three minor children) and any other matters that the trustee considered relevant: Telstra Corporation Ltd v Australian Competition and Consumer Commission (2008) 176 FCR 153 at 181–183 [103]–[112] per Rares J.

62    Ordinarily, a formal act of separation will be conclusive that the relationship of “living together” has come to an end even if the legal status of marriage, or the ties of children, shared assets or liabilities might continue to exist. But mere geographical separation, including habitation in different households, is not, of itself, sufficient to bring about the factual consequence that two people are not any longer “living together” within the meaning of a marital or couple relationship.

63    The trustee argued that the expression “living with each other” in the chapeau to the definition of marital or couple relationship required that the parties must in fact live in the same household. I reject that argument. The chapeau introduces a concept that is fleshed out in the first and second alternatives of the definition of “marital or couple relationship”. Indeed, the same words are used, verbatim, in the second limb of the definition of “spouse”.

64    For the purpose of determining whether persons were in the second alternative of the definition of a marital or couple relationship, the decision-maker has to have “regard to any evidence relevant in that respect” including whether the person in Mr Rushton’s position was wholly or partly dependent on his late wife. However, that consideration was not determinative in the trustee (or the Authority) forming the opinion about the existence of a marital or couple relationship, unlike its significance in the second limb of the definition of “spouse”, which would apply to govern the position if Mr Rushton could not establish that he was in an existing marital or couple relationship.

65    The trustee argued in its written submissions that, on the face of its reasons, the Authority did not appear to have considered the second alternative in the definition of marital or couple relationship. I reject that contention. It is pellucid that the Authority did consider this under the heading in its reasons “The complainant does not satisfy the first limb of the definition of spouse”.

66    The whole definition of “marital or couple relationship” was relevant to the first limb of the definition of “spouse”. This required consideration of whether Mr Rushton and the deceased were in a marital or couple relationship of either kind. The Authority dealt with both. At the outset, it recognised that they had separated from 28 February 2014 and thus could not fall into the first alternative in the definition of marital or couple relationship. That is why in its consideration under the above heading, it looked at, and made findings about, the position after the deceased, the children and Mr Rushton had moved to Canberra. In doing so, it had regard to each of the relevant factors in the second alternative of the definition of marital or couple relationship, and found:

When the complainant returned to Canberra he lived with his parents and used a post box as his mail address. He did not live with the deceased and the children who had a separate residence both in Canberra and earlier in Queensland. There is no evidence of shared financial arrangements nor any evidence of a mutual commitment to a shared life together between the deceased and the complainant. It was accepted publicly, by family, friends and the palliative care staff supporting the deceased, the parties were separated before and at the date of the deceased’s death.

It is not sufficient that the deceased and the complainant remained legally married and he provided care for her to establish the relationship was a marital or couple relationship at the date of the deceased’s death. The relationship, as a whole, needs to be considered. I am satisfied the complainant and the deceased, while legally married, were not living in a marital or couple relationship at the date of the deceased’s death. Accordingly, I am satisfied the complainant does not satisfy the first limb of the definition of spouse under the fund’s governing rules.

(emphasis added)

67    In my opinion, the second alternative required the Authority, standing in the shoes of the trustee, to form an opinion about whether the deceased and Mr Rushton were living with each other as husband and wife on a permanent, bona fide domestic basis at the time of her death having regard to the mandatory relevant considerations set out, including that they were legally married to each other, had three children together, had no shared assets or liabilities, and whether Mr Rushton was wholly or substantially dependent on his late wife. That is what the Authority did in the passage I have just quoted.

68    The question of whether two persons are “living together” as husband and wife on a permanent and bona fide domestic basis at the time of the death of a member of the scheme is one of fact, not law. As the cases to which I have referred show, how a human relationship can be characterised by a decision-maker has no one or unique answer. That characterisation will depend on an evaluation of all of the material before the decision-maker as to whether the circumstances of the two individuals at a particular point in time meets the criterion in the instrument under which the decision must be made, here, that of a marital or couple relationship as defined in r 1.2.1.

69    While Mr Rushton appears to have acted in a supportive and considerate manner in the last months of his late wife’s life, and that conduct can well be seen as a recognition of a moral obligation, it does not mean that the deceased recognised that their relationship was again one of them living with each other as husband and wife: Main 78 CLR at 643. The Authority referred to evidence before it, which was not in the appeal papers, in finding that the deceased agreed to Mr Rushton caring for her in that period to enable their children to build a relationship with him because she understood that, after her death, he would be given custody of them. It was open to the Authority to find that Mr Rushton’s care for his late wife and his receipt of a carer’s allowance, by itself, did not require it to form the opinion that they were in a marital or couple relationship. Indeed, its finding was that the deceased’s motivation when she moved to Canberra was not to resume their married life together after their formal separation on 28 February 2014, but to provide for the future welfare of their children.

70    I am not satisfied that Mr Rushton has established any basis to conclude that the Authority erred in arriving at its evaluative finding that he was not in a marital or couple relationship with the deceased at the time of her death. The Authority had the statutory function of finding the facts and drawing its conclusions as to the fairness and reasonableness of the second trustee decision in its operation in relation to Mr Rushton and the children. It did not make any jurisdictional error or act otherwise than in accordance with law in arriving at that conclusion.

The dependency issue

71    The second limb of the definition of “spouse” required the decision-maker to form an opinion as to whether Mr Rushton was wholly or substantially dependent on the deceased at the time of her death if he were to be entitled to a pension.

72    In Commissioner for Superannuation v Scott (1987) 13 FCR 404, the Full Court discussed the meaning of “substantially dependent” in the cognate expression “wholly or substantially dependent”, in a statutory predecessor of the Commonwealth Government’s superannuation scheme for its employees that was closely analogous to the definition of “spouse” in r 1.2.1 in the trust deed. Fisher and Spender JJ, with whom Pincus J agreed on this issue (at 412), said that, as used in the definition, “substantially” meant “in the main” or “essentially” but something less than total (which latter concept is captured by the word “wholly” in the definition) (13 FCR at 407–408, 411). McKerracher, Barker and Rangiah JJ approved that construction in Cole v Minister for Immigration and Border Protection (2018) 261 FCR 537 at 546 [29] following what Branson and Hely JJ had said in Minister for Immigration and Multicultural Affairs v Graovac [1999] FCA 1690 at [10], [11] and [14]. Fisher and Spender JJ also discussed, in obiter dicta (on which Pincus J reserved his views), the meaning of “dependent” in the cognate defined expression. They suggested that the question of whether a person was “wholly or substantially dependent” was one of fact not law (13 FCR at 408–411). In Graovac [1999] FCA 1690 at [14], Branson and Hely JJ said in connection with a different statutory provision:

The issue of substantial dependency is to be determined at the time of decision, but the enquiry is as to the state of affairs subsisting at that point in time which may involve consideration of earlier events, and of future probabilities. In Aafjes v Kearney (1976) 50 ALJR 454, 458 Gibbs J said that the question of whether there is dependence at a particular date is not to be answered by looking only to the circumstances as they existed at that date; past events and future probabilities have to be considered.

73    In Huynh v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 152 FCR 576 at 585–586 [29]–[30], Lander and Rares JJ said:

In workers’ compensation cases, the construction of the word ‘dependent’ and its cognate expressions has been treated as requiring the determination of a question of fact for nearly a century: Potts v Niddrie and Benhar Coal Co Ltd [1913] AC 531 at pp 536-538 per Lord Haldane; Kauri Timber Co (Tas) Pty Ltd v Reeman (1973) 128 CLR 177; Aafjes v Kearney (1976) 180 CLR 199 (‘Aafjes’) at 202, 204, 207-208, 210. In Aafjes, Gibbs J said at 207-208:

‘In Kauri Timber Co (Tas) Pty Ltd v Reeman ((1973) 128 CLR 177 at pp 188-189), I accepted that one person is dependent on another for support if the former in fact depends on the latter for support even though he does not need to do so and could have provided some or all of his necessities from another source. I adhere to that view but it does not follow from it that a person who in fact receives some support from one person cannot properly be said to be wholly dependent on another. It is not the mere fact of receipt of support but the dependence or reliance upon another to provide it that matters. The question whether there is in fact dependence or reliance at the date of death is not to be answered by looking only to the circumstances as they existed at that date; “past events and future probabilities” have to be considered (Lee v Munro (1928), 21 BWCC 401 at p 408). The fact that at the date of death a daughter was being supplied with some of the necessities of life by some third person does not necessarily mean that she was not then wholly dependent for her support upon her father. Obviously enough if the assistance provided by the third person was only intermittent or casual, and unlikely to be continued in the future, it would not prevent the daughter from being wholly dependent on her father (cf the cases cited in Kauri Timber Co (Tas) Pty Ltd v Reeman (1973) 128 CLR at p 188). But even if the assistance was substantial and likely to be continued, it would not necessarily have the effect that the child had to be regarded as a partial dependant of her benefactor and therefore as not wholly dependent on her father. For example, a child whose home was in the country and who lived with her grandparents while attending a school in the city would not for that reason alone cease to be wholly dependent upon her father.

The conclusion that I have reached – that a daughter may be wholly dependent upon her father notwithstanding that she in fact receives support from other sources – is supported by authority, although it is true that the cases in which this was decided are distinguishable on their facts from the present case (see Potts v Niddrie & Benhar Coal Co Ltd [1913] AC 531; Lee v Munro, and Cunningham v M’Gregor & Co (1901) 3 F 775).’

Gibbs J recognized, as do we, that the process of statutory construction necessarily requires one to distinguish cases on different statutes, including distinguishing the current class of case from those being considered in the workers’ compensation generally. However, the workers’ compensation cases are instructive for the purposes of their focus on the question of dependence being a question of fact. Further, the passage we have emphasized from Gibbs J’s judgment is analogous to the facts in the present case.

(bold emphasis added; italic emphasis in original)

74    Courts have taken a similar approach in other statutory contexts in holding that question of dependency is one of fact: Ball v Newey (1988) 13 NSWLR 489 at 492D–E per Samuels JA, with whom Hope and Mahoney JJA agreed.

75    Mr Rushton received a carer’s allowance, not from the deceased, but from a government agency, Centrelink, because, effectively, he was caring for her and the children full time in the last four months of her life. The deceased had bequeathed Mr Rushton a right of occupancy in the former matrimonial home in Scarborough in her will, but, as the Authority found, by the time of her death, that home had been sold and she made no further provision for him. The Authority found that there was no evidence that, after their separation on 28 February 2014, the deceased provided any financial support to Mr Rushton. Those findings were open to the Authority on the material before it.

76    I am of opinion that the Authority’s finding that there was no evidence that Mr Rushton was wholly or substantially dependent on the deceased after their separation on 28 February 2014 was open to it on the facts. There was no evidence that she paid any sum or otherwise contributed towards his living expenses or that she otherwise provided for him, as opposed to their children. Mr Rushton’s reliance on the carer’s pension paid by Centrelink did not entail that the Authority had to find he was dependent on the deceased for support. Mr Rushton said that he lived with his parents so that he was, at least, partly dependent on them providing his accommodation. Thus, in order to succeed before the Authority, he had to establish that he was, in the main or essentially, dependent on the deceased within the meaning of the second limb of the definition of spouse in r 1.2.1: Scott 12 FCR at 411. Given that he was providing care to her and the children, entitled to a carer’s pension and sleeping at his parent’s home, the Authority was entitled to be satisfied that he was not wholly or substantially dependent on the deceased at the time of her death, and the second trustee decision was fair and reasonable in relation to Mr Rushton and the children in accordance with law.

Conclusion

77    In my opinion, the Authority made no jurisdictional or other error in finding that the second trustee decision was within its powers and fair and reasonable in its operation in relation to Mr Rushton and the children.

78    While Mr Rushton’s provision of care and support for his late wife appear to have been well-intentioned, there is no error in how the trustee or the Authority performed their functions under the Act or the rules. It follows that the appeal must be dismissed with costs.

Associate:

Dated:    16 April 2021