O'Neill and Repatriation Commission [2002] AATA 649 (16 July 2002)

Last Updated: 5 August 2002

DECISION AND REASONS FOR DECISION [2002] AATA 649

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q2001/945

VETERANS' APPEALS DIVISION )

Re SEAN O'NEILL

Applicant

And REPATRIATION COMMISSION

Respondent

DECISION

Tribunal Dr EK Christie, Member

Date 16 July 2002

Place Maroochydore

Decision The Tribunal sets aside the decision under review and in substitution therefor decides that Sean O'Neill is entitled to pension payable to him at the Special Rate. The earliest date of effect is 1 March 2001.

...............(Sgnd)................

Dr EK Christie

Member

CATCHWORDS

VETERANS' AFFAIRS - disability pension - veteran assessed at 100% of the General Rate - whether entitled to Special Rate - assessment

Veterans' Entitlements Act 1996 ss 24(1)(c), 120(4)

Repatriation Commission v Sheehy (1995) 133 ALR 654

Forbes v Repatriation Commission (2000) 101 FCR 50

Flenrjar v Repatriation Commission (1997) 48 ALD 1

Re Starcevich and Repatriation Commission (1986) 10 ALN 202

Re Doyle and Repatriation Commission (1986) 47 ALD 187

Jackman v Repatriation Commission (1997) FCA 564

Magill v Repatriation Commission (2002) FCA 744

Polivitte Ltd v Commercial Union Assurance PL [1987] 1 Lloyds Rep 379

Cavell v Repatriation Commission (1988) 9 AAR 534

Bringinshaw v Briginshaw (1938) 60 CLR 336

WRITTEN REASONS FOR ORAL DECISION

2 August 2002 Dr EK Christie, Member

1. This is an application by Sean O'Neill to review a decision of the Veterans' Review Board, made on 17 August 2001, that his pension "be assessed at 40% to operate from and including 7 October 1999 and at 90% to operate from and including 29 February 2001".

2. At the hearing Mr J King, an Advocate of the Returned Services League of Australia (Queensland Branch) represented Mr O'Neill. The Respondent was represented by Mr M Smith, a Departmental Advocate.

3. The disabilities that Mr O'Neill has that have been determined to be service related are:

(a) Contact dermatitis (23/11/99)

(b) Depressive disorder (09/11/00)

(c) Post traumatic stress disorder ["PTSD"] (17/08/01)

(d) Alcohol dependence or abuse (17/08/01).

4. The Tribunal had before it documents lodged pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 (Cth) and the various documents tendered by the parties.

5. Oral evidence on behalf of Sean O'Neill was given by his father, Mr Michael O'Neill, and his treating psychiatrist, Dr Philip Bird. The respondent called no witnesses.

Issues to be Decided

6. The only issue for the Tribunal to decide was whether Mr O'Neill was entitled to pension payable to him at the Special Rate. It was common ground between the parties that only the application of subsection 24(1)(c) of the Veterans' Entitlements Act 1986 was in dispute.

Legal Framework

7. In the Second Reading Speech of the Veterans' Entitlements Bill 1985 relating to amendments which created the current Section 24, the then Minister for Veterans' Affairs said:

"The amendments clarify the eligibility criteria and make it clear that to qualify for a TPI pension, the veteran must be eligible for the 100 per cent general rate pension. In addition the TPI rate pension can become payable only when a veteran is totally and permanently disabled by accepted disabilities and is thereby precluded from continuing to engage in remunerative work. If a person has had the usual span of the working life or, and we emphasise these words, has retired voluntarily or has left employment for reasons other than accepted disabilities, the TPI pension is not payable."

8. The legislative intent was considered by Sackville J in Repatriation Commission v Sheehy (1995) 133 ALR 654:

"The legislative intent seems to me to be that a veteran over the age of 65 is to receive a special rate of pension only if the veteran is prevented from engaging in a field of remunerative activity that he or she was able to perform at some stage during his or her working life. If the veteran could never perform the duties for which he or she was employed, it may be accurate to say the war-caused incapacity prevented the veteran from undertaking the work. It is much more difficult to say that the veteran has been prevented from continuing to undertake the remunerative activity..."

9. The difficulties identified by Sackville J were subsequently addressed in Forbes v Repatriation Commission (2000) 101 FCR 50 at 52 and 53 by RD Nicholson J. The following approach was used to interpret and to apply the provisions of subsection 24(1)(c):

"That approach [ss 24(1)(c)] is best understood by dividing it into its two limbs and relating those limbs to the relevant portions of what follows in s 24(2).

The first limb of s 24(1)(c) reads:

'(c) the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking...'

That limb must be read subject to the application of s 24(2)(b) which reads:

'(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.'

The second limb of s 24(1)(c) reads:

'(c) ....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 of that incapacity; and'

This is to be read in conjunction with s 24(2)(a) which provides:

'(a) a veteran who is incapacitated from war-caused injury or war-caused disease, or both, shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, be reasons of that incapacity if:

(i) 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; or

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

10. With respect to the requirements of subsection 24(1)(c), Nicholson J referred to the decision of the Full Court of the Federal Court in Flentjar v Repatriation Commission (1997) 48 ALD 1 at pages 4-5 where the Court said that the issues before the Tribunal were:

"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?"

11. The above matters must be satisfied to the reasonable satisfaction of the Tribunal in accordance with the standard in subsection 120(4): Re Starcevich and Repatriation Commission (1986) 10 ALN 202; Re Doyle and Repatriation Commission (1986) 47 ALD 187. That meant, as Tamberlin J noted in Jackman v Repatriation Commission [1997] FCA 564:

"The AAT had to determine, to its reasonable satisfaction, whether the applicant's war-caused disabilities were the only reason for him not being in remunerative employment. Burchett J in Cavell stated that this determination is not to be made upon 'nice philosophical distinctions', equally it is not to be made upon complex calculations of the probability that an intervening event may have occurred. The approach is to be guided by commonsense with an 'eye to reality'."

12. The question of a combination of war service conditions and non-war caused conditions and undertaking remunerative work, was also considered by Nicholson J in Forbes v Repatriation Commission (supra) at page 57:

"The applicant's case requires the Tribunal to not have regard to the non war-caused condition where there is a finding that it alone did not stop the applicant from undertaking work. In my view, that course is not open to the Tribunal in the light of the words used in the first limb of s 24(1)(c). The question whether the veteran by reason of the war-caused condition 'alone' has been prevented from continuing to undertake remunerative work can only be answered by reference to all the circumstances in which the war-caused condition exists. The fact that a non war-caused condition is not alone causative of such preventative effect does not prevent it having that effect in combination with the war-caused condition. The possibility of combination is recognised in the third conceptional environment identified in the applicant's case. Furthermore, it is consistent with the application by a Tribunal of a common sense approach 'with an eye to reality'.

As in the case of the present applicant, it is possible that the war-caused condition will be far and away the more dominant of the causes of the preventative effect where there is also present a non war-caused condition having such effect in combination. The result is that the presence of the latter will deny to a veteran qualification for the special rate of pension. Parliament has sought to ameliorate this position by the provisions in s 24(2)(b), to which reference has been made. To date, the applicant has been unable to qualify pursuant to that provision. Whether he can qualify pursuant to that provision in the future remains a question for consideration."

13. Drummond J clarified the situation with respect to satisfying the requirements of subsection 24(1)(c) so as to come within subsection 24(2)(b): Magill v Repatriation Commission [2002] FCA 744 at paragraph 28:

"28. It remains only to note that, having found that Mr Magill's war-caused disabilities did not alone prevent him from continuing to undertake remunerative work, the Tribunal correctly went on to consider whether, notwithstanding that conclusion, Mr Magill might still be able to satisfy s 24(1)(c) by bringing himself within s 24(2)(b). The Tribunal found that he could not do this because he had not genuinely sought to engage in remunerative work after retiring from the Supreme Court. However, the Tribunal's decision that his war-caused disabilities did not alone prevent him from continuing to undertake remunerative work is flawed with error of law. If he can persuade the Tribunal, on reconsideration, that his disabilities were the sole reason for his not being able to continue to undertake remunerative work, it will, for the reasons given, be irrelevant for the Tribunal to consider whether he made genuine attempts to seek work after leaving the Supreme Court in November 1997."

Oral Evidence before the Tribunal

* Evidence of Michael O'Neill

14. Mr O'Neill described the steps his son had taken to find employment following his discharge from the Navy. He said that when his son came home from the Navy his feet were so bad he had to soak them and then cut his socks off. He could not walk properly on his feet and any covering, such as shoes, would cause the dermatitis to flare. It took months to get his feet into reasonable shape again.

15. He summarised his son's subsequent employment as follows:

(i) March 1995 - January 1996: work was not possible due to the severity of dermatitis on his hands and feet.

(ii) January - July 1996: employed as a deckhand on a trawler operating out of Gladstone.

(iii) 1997: employed for various short periods (weeks) undertaking labouring work at a Pomona orchard.

16. Mr O'Neill stated that his son could not continue working primarily because of his dermatitis. He said that his son was not given further work on the trawler due to his dermatitis on both his feet and hands and because he was getting very depressed and angry. He was having problems with authority, was moody, and at times very aggressive. His son's work at the Pomona orchard finally ceased as he was continually getting into trouble for removing his boots to relieve the dermatitis. He was continually seeking work, beyond this time, but as soon as his feet were sighted and sometimes his hands, nobody would give him work for fear of contracting the disease. Mr O'Neill said that his son was eventually sacked because of his need to work in thongs (to relieve his dermatitis) - but which management would not tolerate. Also, the antidepressant medication taken for his PTSD affected his emotional state and behaviour, (e.g. his agressiveness towards and intolerance of workers at times), his mental alertness and motivation for work - all side effects of his PTSD, but impacts which management would not tolerate.

17. In response to a question in cross-examination, Mr O'Neill said that his son could not use the skills he had acquired in the Navy as a diesel fitter because of the effect of diesel on dermatitis.

* Evidence of Dr Philip Bird: Treating Psychiatrist

18. Dr Bird had been treating Sean O'Neill from 15 February 2001. Dr Bird stated that Sean O'Neill's PTSD would significantly affect his ability to undertake work because he would be difficult to manage in the workplace. His behaviour would be unpredictable as he would not conform to a stable work environment. The unpredictability and adverse response could occur in periods as short as four minutes. Furthermore because of his dermatitis condition, and his inability to wear normal footwear, he would be further set apart from his work colleagues thereby leading to further victimisation.

19. It was Dr Bird's opinion that, because of Mr O'Neill's PTSD, it would be difficult to find an employer who would employ him because of his aggression and emotional behaviour as he still remained physically aggressive.

20. In Dr Bird's opinion, the severity of Sean O'Neill's PTSD could be seen in the time he had spent in a psychiatric hospital in the past 18 months viz. About six admissions. The severity of his PTSD symptoms required intensive therapy.

21. It was also Dr Bird's professional opinion that there had been a significant abatement in Mr O'Neill's schizophrenic symptoms. However, in contrast, he considered that his PTSD symptoms were more resistant to improvement and there had not been the same degree of improvement with treatment as there had been for his schizophrenia.

22. In response to a Tribunal question, concerning the interaction (or combination) between PTSD and schizophrenia and Mr O'Neill's ability to undertake work, Dr Bird stated:

" If we ignore the schizophrenia completely I do not think he is in a situation to gain remunerative employment... I think with his level of symptoms [of PTSD], it is inconceivable that he could be able to find remunerative employment at this stage."

Contentions and Submissions of the Parties

23. Mr King submitted that Sean O'Neill could not undertake remunerative employment following his discharge from the Navy due to his accepted service-disabilities of PTSD and contact dermatitis.

24. However, he submitted that Mr O'Neill attempted to remain in remunerative employment and actively sought work until his accepted service-disabilities prevented him from doing so.

25. Finally, Mr King submitted that the accepted service-disabilities of Mr O'Neill - PTSD, contact dermatitis, depressive disorder and alcohol dependence/abuse, in themselves, prevented Mr O'Neill from engaging in remunerative employment and would prevent him from doing so in the future.

26. Mr Smith, for the Respondent, contended that s 24(1)(c) of the Veterans' Entitlement Act was not satisfied in that schizophrenia was a significant contributor to Mr O'Neill's inability to work.

27. Mr Smith further submitted that the s 24(2)(b) provisions of the Veterans' Entitlement Act were not satisfied because Mr O'Neill had not been seeking remunerative work during the assessment period and, in addition, because his schizophrenia also seriously undermined his ability to work.

Consideration of the Issues

28. The Tribunal finds that Dr Bird's expert evidence has provided independent assistance to the Tribunal by way of representing objective, unbiased opinion regarding matters within his expertise (see Polivitte Ltd v Commercial Union Assurance Co PL [1987] 1 Lloyds Rep 379 at 386 and should be given weight in the Tribunal's fact finding process.

29. The next issue for the Tribunal to decide relates to the application of subsection 24(1)(c) to all the evidence and information before the Tribunal. In evaluating the factual evidence, the Tribunal has done so in accordance with subsection 120(4)(c) of the Veterans' Entitlements Act 1986. In addition, the Tribunal has determined the factual issues to its "reasonable satisfaction" by applying the approach in Cavell v Repatriation Commission (1998) 9 AAR 534, as referred to in Jackman v Repatriation Commission (supra), that is "...to be guided by commonsense with a 'eye to reality'."

30. Accordingly, the Tribunal considers the sequential issues identified in Flentjar's case and makes the following findings.

31. The central issue is whether Mr O'Neill's accepted service conditions were the only factors preventing him from continuing to undertake that work. Alternatively, whether there is a possibility that a combination of his accepted service conditions and the non-service condition (schizophrenia) prevented Mr O'Neill from continuing to undertake that work.

32. The Tribunal has given weight to Dr Bird's opinion evidence (paragraphs 18-22). It is significant that Dr Bird's opinion identifies Mr O'Neill's service condition of PTSD as going beyond being simply dominant over the non-service condition of schizophrenia - but is elevated to a significantly higher level. That is, the service condition of PTSD on its own would be sufficient to prevent Mr O'Neill from returning to work [Tribunal emphasis].

33. Moreover, Dr Bird in recognising the psychiatric condition of PTSD as the most important disability, stated in his report (Exhibit R3 page 4, 5 December 2001):

"8. What is the relative contribution of each condition to his work incapacity?

I consider this is a very complex question, with no easy answer. My estimate of the contribution of each disability to his working capacity is not absolute. I will base my answers on the ability of each condition to solely prevent Mr O'Neill from working.

1. Post Traumatic Stress Disorder: I consider his irritability, his outbursts of anger, his impairment of concentration and general social withdrawal, the exacerbation of his symptoms on cues which remind him of his previous traumatic experiences, particularly in the context of authority, would solely prevent him from resuming employment in the workforce [Tribunal emphasis].

2. Schizophrenia: I consider that Schizophrenia also causes a significant impairment in his ability to perform remunerative employment. I consider he may, with Schizophrenia alone, be able to work in a supported position, but he would be unlikely to obtain independent remunerative employment solely as a consequence of his Schizophrenia [Tribunal emphasis].

3. Major Depressive Episode: I do not consider that his current depressive symptoms are sufficient to prevent him from obtaining remunerative employment. I consider they would contribute to the above diagnosis but not solely prevent him from employment.

4. Alcohol Dependence: I do not consider at this time that his Alcohol Dependence in Remission is impairing his ability to perform remunerative employment.

There is clearly an interaction between his Schizophrenia and his Post Traumatic Stress Disorder in his ability to perform remunerative employment. I would consider it unlikely that, if his Schizophrenia were taken away, he would be likely to perform remunerative employment. If the reverse were to happen [i.e. PTSD taken away] as stated above, then I would consider that he may be able to obtain remunerative employment in supported occupations." [Tribunal emphasis]

34. The above opinion in Dr Bird's report was further clarified and expanded upon in his oral evidence (para 22).

35. Together, this evidence gives an objective basis why PTSD alone would prevent Mr O'Neill from undertaking remunerative work.

36. Accordingly, the Tribunal concludes that, notwithstanding that Mr O'Neill has a non-service condition (Schizophrenia), it can be clearly adduced from Dr Bird's expert opinion, to the reasonable satisfaction of the Tribunal, that Mr O'Neill's PTSD, alone, would prevent him from undertaking "remunerative" work. That is, the question of whether some combination of service conditions and a non-service condition prevented Mr O'Neill from undertaking remunerative work does not arise.

37. The Tribunal accepts Dr Bird's evidence and finds that if Mr O'Neill did not have PTSD, contact dermatitis, depressive disorder and alcohol dependence/abuse, he still would have been working. Unfortunately, he does have these service conditions which prevent him from continuing in remunerative work. These service conditions act independently from his schizophrenia in preventing Mr O'Neill from working. That is, in themselves, the service conditions, alone, prevent Mr O'Neill working.

38. Given the finding that Mr O'Neill's service conditions are the sole reason for Mr O'Neill not being able to continue to undertake relevant remunerative work, the subsection 24(2)(b) requirements are satisfied: that is, it is irrelevant for the Tribunal to consider whether Mr O'Neill made genuine attempts to seek work during the assessment period (see Magill's case).

39. Accordingly, the Tribunal concludes that the first limb of subsections 24(1)(c) and 24(2)(b) are both satisfied.

40. The final issue for the Tribunal to consider is whether Mr O'Neill by reason from continuing to undertake that work, has suffered a loss of salary, wages or earnings that he would not be suffering if he were free of that incapacity. It is not in dispute that Mr O'Neill has been permanently unemployed since March 1997 and commenced receiving sickness benefits from August 1997. Furthermore, the Tribunal accepts the evidence of Michael O'Neill on the impacts of Sean O'Neill's accepted disabilities in his ability to undertake work (paragraphs 15,16). Accordingly, the Tribunal concludes that this application for review is one in which Mr O'Neill has suffered a loss of salary, wages or earnings as a direct consequence of his accepted service conditions.

41. Accordingly, the Tribunal concludes that the second limb of subsections 24(1)(c) and 24(2)(a) are both satisfied.

42. For all of the above reasons, the Tribunal sets aside the decision under review and in substitution therefor decides that Sean O'Neill is entitled to pension payable to him at the Special Rate. The earliest date of effect is 1 March 2001.

I certify that the 42 preceding paragraphs are a true copy of the reasons for the decision herein of Dr EK Christie (Member)

Signed: Sarah Oliver

Associate

Date of Hearing 16 July 2002

Date of Decision 16 July 2002

Date of Written Reasons 2 August 2002

For the Applicant Mr J King

For the Respondent Mr M Smith