Noel v Cook [2004] FCA 479 (22 April 2004)

SUPERANNUATION – appeal from Superannuation Complaints Tribunal – complaint to the Tribunal made under s 14 of the Superannuation (Resolution of Complaints) Act 1993 (Cth) – Tribunal affirmed a decision of the second the Trustee to pay 100% of a death benefit to the first respondent – first respondent long-term friend of the deceased – applicant widow of the deceased – dependence – partial dependence

Superannuation (Resolution of Complaints) Act 1993 (Cth) s 12, 14, s 14AA, s 32, s 37, s 46
Superannuation Industry (Supervision) Act 1993 (Cth) s10, s 62

Aafjes v Kearney [1976] HCA 5; (1975) 180 CLR 199
Ball v Newey (1988) 13 NSWLR 489
Briffa v Hay (1997) 75 FCR 428
Colonial Mutual Life Assurance Society Limited v Brayley [2002] FCA 1333
Faull v Superannuation Complaints Tribunal [1999] NSWSC 1137
Flexiplan Australia Ltd v Pankhurst [2001] FCA 1535
Hornsby v Military Superannuation and Benefits Board of Trustees (No 1) [2003] FCA 54; (2003) 126 FCR 484
National Mutual Life Association of Australia v Campbell [2000] FCA 852; (2000) 99 FCR 562
National Mutual Life Association of Australia Ltd v Jevtovic [1997] FCA 359
Petrohilos v Hunter (1991) 25 NSWLR 343
Retail Employees Superannuation v Crocker (2001) 48 ATR 359
Waterford v The Commonwealth of Australia [1987] HCA 25; (1986) 163 CLR 54

LORNA EVELIN NOEL v HARVEY COOK & SAVINGS AUSTRALIA PTY LIMITED (ABN 94 006 457 987)

N1501 OF 2003

BENNETT J
22 APRIL 2004
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N1501 OF 2003

BETWEEN:	LORNA EVELIN NOEL APPLICANT
AND:	HARVEY COOK FIRST RESPONDENT SAVINGS AUSTRALIA PTY LIMITED (ABN 94 006 457 987) SECOND RESPONDENT
JUDGE:	BENNETT J
DATE OF ORDER:	22 APRIL 2004
WHERE MADE:	SYDNEY

2. The second respondent is to file and serve any evidence it intends to rely upon in relation to its application for indemnity costs by 7 May 2004.

3. The applicant is to give notice if she wishes to cross-examine any witness by 14 May 2004.

4. The applicant is to file and serve any list of objections to any evidence filed pursuant to order 2 by 14 May 2004.

5. The applicant is to file and serve any evidence she intends to rely upon in relation to the application for indemnity costs by 28 May 2004.

6. The second respondent is to give notice if it wishes to cross-examine any witness by 4 June 2004.

7. The second respondent is to file and serve any list of objections to any evidence filed pursuant to order 5 by 4 June 2004.

8. The second respondent is to file and serve any evidence in reply to any evidence filed pursuant to order 5 by 11 June 2004.

9. The second respondent is to file and serve any written submissions in relation to the application for indemnity costs by 18 June 2004.

10. The applicant is to file and serve any written submissions in relation to the application for indemnity costs by 2 July 2004.

11. The second respondent is to file and serve any written submissions in reply by 9 July 2004.

12. Either party is to notify Bennett J’s associate by 16 July 2004 if she or it wishes to supplement the written submissions at a hearing.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N1501 OF 2003

BETWEEN:	LORNA EVELIN NOEL APPLICANT
AND:	HARVEY COOK FIRST RESPONDENT SAVINGS AUSTRALIA PTY LIMITED (ABN 94 006 457 987) SECOND RESPONDENT

JUDGE:	BENNETT J
DATE:	22 APRIL 2004
PLACE:	SYDNEY

1 This is an ‘appeal’ brought under s 46 of the Superannuation (Resolution of Complaints) Act 1993 (Cth) (‘the Act’) from a decision of the Superannuation Complaints Tribunal (‘the Tribunal’) affirming a decision of the second respondent (‘the Trustee’) to pay 100% of a death benefit to the first respondent (‘Mr Cook’).

2 The applicant (‘Mrs Noel’) and Mr Brian Noel were married on 17 November 1990. Mr & Mrs Noel separated on 30 May 1996 after Mrs Noel took out an ‘AVO’ against Mr Noel, preventing any contact by him. That order was not revoked. There were no children of the marriage. Mr Noel died on 21 July 2001. Mr Noel was in hospital for approximately two months prior to his death. On 20 July 2001 Mr Noel signed an application for divorce from Mrs Noel but it was not filed with the Family Court of Australia and not served on Mrs Noel.

3 Mr Noel commenced living with Mr Cook in a spare room with payment for board and expenses in about August 1996 and continued to do so until his death. Mr Cook and Mr Noel were long-term friends who had served in Vietnam together and it is not in dispute that they had a mutual, committed and supportive relationship. Mr Cook now lives with his partner and two adult children.

4 Mr Noel applied to join the Superannuation Trust Fund of Australia (‘the Fund’) on 21 November 1990 and was, at the date of his death, a member of that Fund. The second respondent (‘the Trustee’) is the Trustee of the Fund under the Superannuation Trust of Australia Trust Deed (‘the Trust Deed’). The proceedings before the Tribunal concerned a complaint by Mrs Noel that the Trustee’s exercise of its discretion under the terms of the Trust Deed to pay 100% of the benefit arising from the death of Mr Noel to Mr Cook as a financial dependant was "unfair and unreasonable". The amount now in issue in the proceedings is approximately $17,000.

5 On 2 September 2003, pursuant to s 37(3) and s 37(6) of the Act the Tribunal determined that it was satisfied that the Trustee’s decision to pay 100% of the death benefit to Mr Cook was fair and reasonable in its operation in relation to Mrs Noel and Mr Cook in the circumstances and, accordingly, affirmed the Trustee’s decision.

8 Pursuant to s 14(2) of the Act, a complaint may be made to the Tribunal that a decision of a Trustee is or was "unfair or unreasonable". Section 37(3) of the Act provides that:

be entitled to benefits through, a person having an interest in the death benefit;

10 In addition to the findings of fact outlined in [2]–[3] above, the Tribunal found that each of Mrs Noel and Mr Cook is a "dependant" within the meaning of clauses 4.1 of Schedule 2 and 1.2(22) of Schedule 1 of the Trust Deed. The Tribunal found that Mr Cook was financially inter-dependent with Mr Noel for a period of about 6 years and dependent on Mr Noel’s contributions to meet his leasing and other liabilities.

11 The relative financial positions of Mrs Noel and Mr Cook are as follows. Mrs Noel, who was aged 54 years at the date of Mr Noel’s death, is unemployed, lives in her mother’s house, has assets of $12,000 cash in the bank, income of $9,614.80 per annum (gross) and liabilities of $60 per week (which equates to $3,120 per annum). Mr Cook, who was aged 54 years at the date of Mr Noel’s death, lives with his partner and two adult children, having a combined income of approximately $22,000 per annum plus repatriation benefits, a bank loan of about $10,000 and house valued at $550,000. Mr Cook was clearly better off financially than Mrs Noel.

12 The main issue before the Tribunal was whether Mr Cook was financially dependent on Mr Noel. Mrs Noel asserted that she was a "dependant" but that Mr Cook was not a "financial dependant" of Mr Noel. The main issue gave rise to a number of sub-issues as raised by Mrs Noel:

13 A number of submissions were made by the Mrs Noel as to her right as a dependant. However, it does not seem to have been in dispute before the Tribunal, nor was it before this Court, that she is a "dependant" within the meaning of the Trust Deed.

14 As the Tribunal pointed out, the issue before it was whether the decision of the Trustee to pay 100% of the benefit arising from the death of the deceased member (Mr Noel) to Mr Cook as a financial dependant was fair and reasonable in the circumstances in relation to Mrs Noel and Mr Cook.

15 The Tribunal found that Mr Cook qualified as a dependant of Mr Noel under the terms of the Trust Deed. It found that the evidence clearly demonstrated that there was a financial inter-dependency for a period of approximately six years referring to the payment of board. There was no reliance, in the Tribunal’s deliberations, on acts done after Mr Noel’s death, nor on acts during Mr Noel’s hospitalisation. In addition, the Tribunal found that Mr Noel and Mr Cook were mutually committed to and supportive of each other. With respect to Mrs Noel, the Tribunal noted that there was no evidence that she was in any way financially dependent on Mr Noel and had never sought financial support from him for the period up to his death.

16 The Tribunal also considered the wishes of the deceased. While he had originally nominated Mrs Noel to receive 100% of any benefit arising in the event of his death, this nomination was later changed to Mr Cook. The Trustee’s records did not, however, indicate the date of the change. The Tribunal found that the change constituted a true record of Mr Noel’s wishes at the date of his death. It was not in dispute, however, that the Trustee is not obliged to pay the benefit to any particular dependant, including the nominated beneficiary.

19 The amended notice of appeal includes a number of ‘Grounds’. They serve to elaborate on and provide particulars of the stated questions of law. Although, as pointed out by Counsel for the second respondent, they do not properly qualify as grounds but are in the nature of further contributions or assertions, and although the questions of law are not stated as such, I will have regard to the whole of the amended notice of appeal in order to understand Mrs Noel’s case, which she is conducting in person.

20 The grounds set out in the amended notice of appeal relate in part to the applicant’s status as a dependant. Those grounds include assertions that there is no need for Mrs Noel to produce evidence that she was financially dependant on Mr Noel by reason of her inclusion in the definition of dependant in the Trust Deed and also that the deceased member’s nomination of beneficiaries is relevant but not binding on the Trustee. Neither of those matters is in issue.

21 Counsel for the Trustee, in her most helpful submissions and despite her objection to the characterisation of the questions of law and the grounds, sought to identify from the notice of appeal the issues between the parties. She identified from the grounds a further question of law: that there was no evidence that Mr Cook was dependent on the deceased at the actual time of his death, as Mr Noel had been hospitalised for the last two months of his life.

22 An appeal to the Court from the Tribunal is confined to questions of law (section 46(1) of the Act). The error of law must arise on the facts as the Tribunal has found them, or must vitiate the findings made or must have led the Tribunal to omit a finding it was bound to make (Waterford v The Commonwealth of Australia [1987] HCA 25; (1986) 163 CLR 54 per Brennan J at 77).

23 The role of the Tribunal and the statutory framework have been discussed in other cases and it is not necessary to repeat that discussion here. The nature of this task has been summarised by Allsop J in Retail Employees Superannuation v Crocker (2001) 48 ATR 359 (‘Crocker’) at [21]–[32], Mansfield J in Hornsby v Military Superannuation and Benefits Board of Trustees (No 1) [2003] FCA 54; (2003) 126 FCR 484 at [15]–[20], Lee J in Flexiplan Australia Ltd v Pankhurst [2001] FCA 1535 at [23]–[33] and Branson J in Colonial Mutual Life Assurance Society Limited v Brayley [2002] FCA 1333 (‘Brayley’) at [27]–[34].

24 It is not clear what error of law is referred to. Whether a person is wholly or partially dependent upon another is itself a question of fact (Aafjes v Kearney [1976] HCA 5; (1975) 180 CLR 199 (‘Aafjes’) at 204 per Barwick CJ, at 206-8 per Gibbs J, at 210 per Mason J; Petrohilos v Hunter (1991) 25 NSWLR 343 at 346). From the grounds set out in the amended notice of appeal, it would seem that Mrs Noel was referring to her status as a "dependant". That was not in issue before the Tribunal and is not in issue before me. Mrs Noel is a "dependant" within the definition in the Trust Deed.

25 The Tribunal found, as a fact that was open to it on the evidence before it, that Mr Cook was partially dependent on Mr Noel and was therefore a dependant within the definition. That conclusion was based upon evidence of their financial inter-dependency and mutual commitment and support. Rolfe J considered partial financial dependency in Faull v Superannuation Complaints Tribunal [1999] NSWSC 1137. There, a payment of $30 per week for board was made to a person with an annual salary of $39,411. His Honour confirmed (at [28]) the decision of the trustee in that case that such a payment was sufficient to make the recipient partially financially dependent on the deceased and observed (at [15]) that the gross discrepancy between the financial positions of the contesting parties was not relevant to dependency, although the degree of financial dependency may be relevant to deciding how the discretion should be exercised (at [29]). It is not a question of need of the support or the ability to obtain it from another source but the fact of the dependence (Aafjes at 207-8 per Gibbs J). Further, the Trust Deed defines "dependant" specifically to include a person who was partially dependent on the Member or former Member.

26 The Tribunal did not refer to the Superannuation Industry (Supervision) Act 1993 (Cth) (‘SIS Act’) in respect to the definition of "dependant". However, the SIS Act adds nothing of relevance to the matters that the Tribunal had to determine. Section 10 of the SIS Act provides:

The definition is expressly inclusive not exclusive. Section 62 provides that the trustee of a regulated superannuation fund must ensure that the fund is maintained solely for the core purposes of the fund including that ‘the benefits are provided to the member’s legal personal representative, to any or all of the member’s dependants, or to both’. The Fund clearly complies with this requirement and Mrs Noel did not contend otherwise before the Tribunal. The SIS Act has no relevant operation to the definition of "dependant" in the Trust Deed. The Tribunal did not err in not referring to the SIS Act in respect of the definition of "dependant".

Question 2: What circumstances are relevant in determining who is a ‘dependant’

Question 3: What circumstances are irrelevant in determining who is a ‘dependant’

27 No fact or matter which is said to be relevant and which the Tribunal is said to have failed to take into account is specifically identified in question 2. Similarly, no fact or matter said to be irrelevant which the Tribunal took into account is specifically identified in question 3.

28 In the grounds, the applicant refers to a number of matters said to be relevant. Each of the facts and matters so identified formed part of the Tribunal’s reasons. The reference to the deceased member’s nomination of preferred beneficiary, the fact that Mr Cook was only partially financially dependent on the deceased, his financial circumstances and Mrs Noel’s financial and personal circumstances were each referred to by the Tribunal and specifically considered as part of the "Tribunal’s Deliberations". Each of the facts and matters referred to in the grounds as relevant was taken into account by the Tribunal.

29 The grounds can also be read to refer to a number of matters said to be irrelevant. They were the need on the part of Mrs Noel to produce evidence of her financial dependence on the deceased as at the date of death and the evidence of the personal relationship between Mr Cook and Mr Noel, including offices performed by Mr Cook after Mr Noel’s death.

30 To the extent that it was necessary for the Tribunal to determine for itself as a matter of fact whether Mr Cook was partially dependent on Mr Noel, consideration of their relationship was relevant to the determination of that question. To determine dependency it is necessary to consider the whole of the relationship between the alleged dependant and the deceased (Ball v Newey (1988) 13 NSWLR 489 per Samuels JA (with whom Hope JA agreed) at 491). In Aafjes, Gibbs J (at 208) observed:

31 Funeral arrangements and other offices performed by Mr Cook after Mr Noel’s death were not irrelevant to the question. However, it does not appear that the Tribunal accorded these any significance, as they are not referred to in that part of the Tribunal’s reasons headed "Tribunal’s deliberations".

32 It is not for the Court to conduct a rehearing on the merits or to revisit the factual findings that were open to the Tribunal on evidence. No error of law by the Tribunal has been established with respect to questions 2 or 3.

Question 4: What is the time of determining when a person is a ‘dependant’

33 The submission that it is only the date of death that must be looked to for the purposes of establishing dependency was not raised before the Tribunal and therefore could not give rise to error on the part of the Tribunal. In any event, dependence at the date of death is not determined by looking only to the circumstances as they existed at that date but at the whole of the relationship (Aafjes at 208).

34 From the Tribunal’s reasons, it is apparent that it had regard to the obligation to consider dependants, other than a spouse or child, at the time of the member’s death in accordance with the definition in clause 1(22) of Schedule 1 to the Trust Deed. The factual finding of the Tribunal, after referring to the term "dependant" as defined in the Trust Deed, was in respect of Mr Cook’s financial dependence ‘from 1996 until his death in 2001’. No error is apparent.

35 The task of the Tribunal was to consider whether the outcome of the Trustee’s decision was fair and reasonable in its operation to the claimants in the circumstances (National Mutual Life Association of Australia v Campbell [2000] FCA 852; (2000) 99 FCR 562 at [15]; s 37 of the Act).

36 A fair reading of the whole of the Tribunal’s reasons for decision shows that the Tribunal understood the function required of it under s 37 of the Act and performed that function without error (cf National Mutual Life Association of Australia Ltd v Jevtovic [1997] FCA 359).

37 No error of law in the Tribunal is disclosed by the amended notice of appeal. It could not be said that the Tribunal failed to address the correct question or that there was no basis in the evidence for the conclusion it reached.

38 It appears that the applicant’s contention is really with the Tribunal’s determination of the facts and merits of the case and the appeal does not concern any question of law.

39 At the hearing Mrs Noel appeared without legal representation. Mr Cook did not appear and the Trustee was represented by Ms Heath of Counsel. Mrs Noel handed up written submissions which I reproduce as written.

‘On the evidence showen to STA ther was none ther to say that at thed time of my late husbands death that Mr Cook was not a dependant and that my husband was in hospitalat the time of his death and that Mr Cooks financial dependancy finished at that time of Brians entry to hospital.’

40 This raises a number of issues – it would seem to be an assertion that there was no evidence upon which the Tribunal could make a finding of fact that Mr Cook was financially dependant on Mr Noel. This was the further issue identified in the grounds in the notice of appeal.

41 The evidence was referred to in the Tribunal’s decision and gave rise to the findings of fact as set out above. There was evidence before the Tribunal from Mr Cook, in which Mr Cook stated in response to the questions ‘payments made to you by the deceased until the date of death’ and ‘payments jointly made by the deceased and you (eg electricity, telephone and mortgage payments)’, that the amount of $80 per week for rent and shared costs and $10 per week for council and water rates were payments made. There was no evidence that these payments ceased after Mr Noel entered hospital. In any event, the issue sought to be raised, that there was no evidence of financial dependency as at the specific date of death was not raised before the Tribunal.

‘On page 55 to 57 of document 42 in his own handwritting saying that Mr Cook was not a dependant(date 28.8.01)’

42 This relates to a factual admission against interest by Mr Cook. There was, however, other evidence from Mr Cook in the statutory declaration referred to by the Tribunal in its reasons, that he did not understand the meaning of dependant when he completed the document in question. In any event, clause 1.2(22) of Schedule 1 to the Trust Deed provides that a finding of dependency is for the Trustee to determine and that would be from the whole of the evidence available to the Trustee.

43 The ground raises a factual matter. The finding by the Tribunal as to whether or not Mr Cook was financially dependant on Mr Noel was a finding of fact. There was evidence to support that finding of fact and the admission by Mr Cook goes to the weight of the evidence. No error of law has been established.

‘On page 42 of document 42 he original application for superanuation dated 21.11.90 and that there is no witten proof of any change of name from myself to anyone else.’

44 There was before the Tribunal a record made by the Trustee, referring to the change of the nominated beneficiary from Mrs Noel to Mr Cook. The Tribunal found that the deceased deleted the complainant and substituted Mr Noel notwithstanding the fact that the date of that act could not be established. That was a finding of fact based upon the evidence before the Trustee. It was a finding of fact open to the Trustee and to the Tribunal. No error of law has been established.

‘There was never any mediation between myself, Mr Cook and STA at any time until December 2003.’

45 This submission may be addressed to s 12 of the Act which provides that one of the functions of the Tribunal is to try to resolve a complaint by conciliation and, if it can cannot be resolved by conciliation, to review the decision or conduct to which the complaint relates. Mrs Noel makes an assertion in her written submission but there is no evidence from her or reference in the Tribunal decision to support the assertion. I do note that notice had been given to Mrs Noel by the Tribunal under section 32 of the Act. Section 32 relates to arrangements for review meetings if the Tribunal has tried to settle a complaint by conciliation but has not been successful and the notice itself refers to unsuccessful attempts to resolve the complaint. If the submission is seeking to assert an error of law in failure to comply with the Act before undertaking a review, the necessary factual basis has not been established. The relevance of the submission is not otherwise apparent and there was no elaboration by Mrs Noel.

‘Page 34 of document 44 saying that Mr Cook has only one house in his financial statement dated 16.2.03 as he has one as 12 Galgaba St Swansea to which he let to my late husband that is why he is claming that my late husbsnd payed rent to him at that premises. Which he claims he was financialy dependant on him for.’

46 The relevance of this submission is not clear. To the extent that it is in relation to the finding of fact that Mr Cook was financially dependent on Mr Noel, it does not impact upon the Tribunal’s findings of financial dependence, which was based upon the payment of certain expenses by Mr Noel. That dependence may be partial ([25] above). No error of law has been established.

‘I agree that to Mr Cook receiving the $4,000 dollars that he has asked for and I receive the balance of $13,000 dollars to which I have asked for as my legal right to.’

48 Mrs Noel raised further matters in oral submissions. Some were in relation to her status as a dependant but that was not in issue. She also pointed out that the Trustee had originally made a determination that the monies should be paid to her and that after receipt of submissions from Mr Cook, the Trustee changed that decision. Mrs Noel said that she was not notified of the Trustee’s decision to make the payments to Mr Cook rather than to herself until after that decision was made. Mrs Noel did not elaborate this point. Mrs Noel was subsequently notified of the decision and then made a complaint under s 14 of the Act and the complaint was dealt with as provided for in the Act. The Tribunal, in exercising its powers, has all the powers, obligations and discretions that are conferred on the Trustee and makes a determination within the strictures of s 37. Where the Tribunal reviews a decision that involved the exercise of a discretion within the meaning of s 14AA, it is to consider whether the actual decision, as opposed to the process by which the decision was reached, was fair and reasonable in the circumstances Brayley at [31]. It is the unfairness or unreasonableness of the decision itself that falls for consideration, not some other perceived unfairness or unreasonableness in and about the conduct of the fund (Crocker at [27]). That was what the Tribunal did in this case. The Tribunal, in making its determination, stands ‘in the shoes of ’ the Trustee (Briffa v Hay (1997) 75 FCR 428 at 443 per Merkel J).

49 In any event, this was not a subject of complaint to the Tribunal and is not relevant to the appeal.

50 The applicant has not established any error on the part of the Tribunal. It follows that the application must be dismissed. The second respondent has sought indemnity costs. When this was raised at the hearing, I indicated that, if the applicant were unsuccessful, I would give directions for any further evidence on the question of costs and brief written submissions on the question of costs to avoid further unnecessary expenditure. I propose to do so.

4. The applicant is to file and serve any list of objections to any evidence filed pursuant to order 2 by 14 May 2004.

I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett.

Applicant appeared in person

No appearance by the First Respondent

Counsel for the Second Respondent:	V Heath

Solicitor for the Second Respondent:	Deacons

Date of Hearing:	6 April 2004

Date of Judgment:	22 April 2004

Federal Court of Australia

Noel v Cook [2004] FCA 479 (22 April 2004)