|
|
[Home]
[Databases]
[WorldLII]
[Search]
[Feedback]
Federal Court of Australia |
Last Updated: 20 June 2008
FEDERAL COURT OF AUSTRALIA
Nowicka v Superannuation Complaints Tribunal [2008] FCA 939
SUPERANNUATION –
Superannuation Complaints Tribunal – complaint – power to
treat complaint as withdrawn where misconceived –
review of
Tribunal’s decision to treat complaint as withdrawn – soldier
absent without leave at date of death –
member of superannuation
scheme – death benefit not payable to spouse where member absent
without leave unless absence
due to sufficiently mitigating
circumstances – determination by Tribunal that those circumstances
existed –
interest for delay in payment of benefit – date
from which interest runs – whether death of member or determination
of Tribunal
PRACTICE AND
PROCEDURE – stare decisis – precedent –
decision based on absence of power in tribunal to award interest –
Judge then said that even if the tribunal had power, the requirements for its
exercise were not made out – whether a second
reason for
decision – whether obiter – degrees of obiter
Superannuation (Resolution of Complaints)
Act 1993 (Cth), ss 22(3)(b), 41(3)
Military Superannuation and
Benefits Rules, rules 40, 69, Schedule 6
Military Superannuation and Benefits Board
of Trustees No 1 v Batt [2005] FCA 1865; (2005) 149 FCR 448 considered
Jacobs v
London County Council [1950] AC 361 cited
Commissioners of Taxation
(NSW) v Palmer [1907] AC 179 cited
McBride v Monzie Pty Ltd [2007]
FCA 1947 cited
Brunner v Greenslade [1971] Ch 993
applied
Chief Supplementary Benefit Officer v Leary [1985] 1 WLR 84
cited
BHP Billiton Iron Ore Pty Ltd v National Competition Council
(2007) 162 FCR 234 applied
Cross and Harris, Precedent in English
Law, 4th ed
(1991)
ANETA NOWICKA v
SUPERANNUATION COMPLAINTS TRIBUNAL, MARGARET MCDONALD and MILITARY
SUPERANNUATION AND BENEFITS BOARD OF TRUSTEES NO
1
VID 784 OF
2007
SUNDBERG J
20 JUNE
2008
MELBOURNE
|
AND:
|
THE COURT ORDERS THAT:
1. The application be dismissed.
2. The applicant pay the third respondent’s costs of the
application.
Note: Settlement and entry
of orders is dealt with in Order 36 of the Federal Court Rules.
|
BETWEEN:
|
ANETA NOWICKA
Applicant |
|
AND:
|
SUPERANNUATION COMPLAINTS TRIBUNAL
First Respondent MARGARET MCDONALD Second Respondent MILITARY SUPERANNUATION AND BENEFITS BOARD OF TRUSTEES NO 1 Third Respondent |
|
JUDGE:
|
SUNDBERG J
|
|
DATE:
|
20 JUNE 2008
|
|
PLACE:
|
MELBOURNE
|
REASONS FOR JUDGMENT
BACKGROUND
1 On 1 April 1999 Private Robert Przydatek died while absent without leave from the Australian Defence Force. At the time of his death he was a member of the Military Superannuation Benefit Scheme (the Scheme) established by a Trust Deed and regulated by the Military Superannuation and Benefits Act 1991 (Cth) and the Military Superannuation and Benefits Rules (the Rules). The Scheme is a regulated superannuation fund for the purposes of the Superannuation (Resolution of Complaints) Act 1993 (Cth) (the Act). The third respondent (the Board) administers the Scheme and is its trustee.
2 On 9 October 2000 the applicant applied to the Board for spouse benefits in relation to the deceased’s Scheme membership. On 4 September 2002 the Board determined that she was not a spouse. On 31 March 2003 the Board’s Reconsideration Advisory Committee decided she was a spouse.
3 Rule 40 of the Rules deals with payment of a deceased member’s "employer benefit". Under subrule (1) the benefit is payable to the deceased’s surviving spouse as a lump sum. Subrule (4) provides that subrule (3), which prescribes the calculation of an employer benefit, does not apply where at the time of a member’s death he or she was absent without leave unless the Board is satisfied that the absence was due to "sufficiently mitigating circumstances". On 17 December 2003 the Board determined that it was not so satisfied.
4 On 13 April 2004 the applicant lodged a complaint with the first respondent (the Tribunal) in relation to the Board’s 17 December 2003 determination. On 4 May 2004 the applicant was paid part of the employer benefit in the sum of $14,195.55. On 27 October 2005 the Tribunal determined that there were sufficiently mitigating circumstances for the deceased’s absence without leave, and set aside the Board’s decision on the ground that it was not fair and reasonable in its operation in relation to the applicant. It substituted its own decision that "the death benefit including the benefit under rule 40(3)" be paid to the applicant. On 1 November 2005 the Tribunal’s determination was received by the Board. On 15 November it decided to pay the applicant the balance of the employer benefit, but not to pay interest thereon. On 18 November the applicant was paid $207,438.54, being the balance of the employer benefit without interest.
5 The applicant complained to the Board about the non-payment of interest. On 18 October 2006 the Board determined, pursuant to rule 69(1), that interest in the sum of $4,538.06 was payable on the part benefit paid on 4 May 2004, because payment had not been made within fifteen working days as required by clause 5(2) of the Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2004. However the Board decided there had been no delay for the purposes of rule 69(1) in the payment of the balance of the benefit and therefore no interest was payable thereon.
6 In December 2006 the applicant lodged a complaint with the Tribunal against the non-payment of interest on the balance of the benefit. On 19 March 2007 the Tribunal advised her that her complaint was "based on a legal misconception and has no foundation" and was therefore "misconceived" for the purposes of s 22(3)(b) of the Act. It invited a submission as to why the complaint should not be withdrawn under s 22(3)(b) because there had been no delay in the payment of the "prospective portion" of the benefit. The applicant lodged a submission. In July 2007 the Tribunal informed her that the complaint was misconceived and it would treat it as withdrawn pursuant to s 22(3)(b).
TRIBUNAL’S REASONS FOR DECISION
7 The basis for the Tribunal’s reasons for its July 2007 decision appears from the following summary:
(a) "there were two parts to the benefit payable as a result of the death of a member ... being the minimum employer benefit and the balance of the employer benefit";
(b) under rule 40(4) the balance of the employer benefit is only payable, in the case of a member who was absent without leave, where there are sufficient mitigating circumstances;
(c) in such a case the balance is only payable if and when the Board, or the Tribunal standing in its stead, determines that mitigating circumstances exist;
(d) the determination in (c) is an "ancillary decision" that was required to be made before the balance of the employer benefit became payable;
(e) Military Superannuation and Benefits Board of Trustees No 1 v Batt [2005] FCA 1865; (2005) 149 FCR 448 (Batt) is indistinguishable from the present case and the Tribunal must follow that decision;
(f) consequently the Tribunal was treating the applicant’s complaint as withdrawn under s 22(3)(b) on the ground that it was misconceived.
8 The applicant seeks review of the Tribunal’s decision under the Administrative Decisions (Judicial Review) Act 1977 (Cth). She also appeals to the Court under s 46 of the Act. The appeal is on a question of law.
THE RULES
9 Under rule 40(1)(a) a deceased member’s employer benefit is payable to his or her spouse as a lump sum. Subrule (3) provides:
An employer [benefit] payable under subrule (1) is calculated as if, on the date of the death of the deceased member, he or she had become entitled to invalidity benefits under Division 2 of Part 3 and had been classified as Class A under rule 22.Subrule (4) provides:
Subrule (3) does not apply where: (a) a member dies and, at the time of his or her death, he or she was absent without leave and had been so absent for a period that exceeds 21 consecutive days; and (b) ...; unless the Board is satisfied that the absence of the member was due to sufficiently mitigating circumstances.10 One element in the calculation of a person’s employer benefit is his or her years of eligible service. Schedule 6 of the Rules is in part as follows:
The eligible service of a member is the sum of: (a) ... service by the person as a member; and (b) in the case of a person entitled to an invalidity pension who is classified as Class A – a period equal to the period commencing on the day immediately following the last day of the person’s service and concluding on the day on which the person would have retired if he or she had not been retired on the ground of invalidity but had served until attaining:(i) his or her retiring age immediately before his or her retirement; or(ii) the age of 55 years ...
whichever is greater ....
11 The effect of rule 40(3) in conjunction with Schedule 6 is that a spouse who survives a deceased member is entitled to a death benefit equal to the member’s employer benefit calculated at the time of the member’s death, plus the prospective service entitlement that would have accrued had the member served until age 55. The effect of subrule (4) is that if the member was absent without leave at the time of death, and the Board decides there were no sufficiently mitigating circumstances for the absence, the spouse is entitled to a death benefit reflecting the member’s employer benefit at the time of death without taking the prospective service into account. The $14,195.55 paid to the applicant on 4 May 2004 was the benefit without taking the deceased’s prospective service into account. The $207,438.54 paid on 18 November 2005 was the amount referable to his prospective service.
12 Rule 69(1) provides:
Where a benefit is payable as a lump sum to a person and the payment of the benefit is delayed, the Board may, in accordance with this rule, approve an increase, by an amount of interest, in the amount of the benefit payable to the person.Interest in respect of a lump sum payment is calculated in such manner as the Board determines "in respect of the period of the delay": subrule (4)(a).
DELAYED PAYMENT DETERMINATION
13 Section 5 of the Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2004 made under the Trust Deed for the purposes of rule 69(1) provides in part:
(1) For paragraph 69(4)(a) of the Rules, and subject to subsection (2), interest is calculated over the period beginning on:
(a) if, under the Rules, the lump sum benefit is payable after a period of preservation – the day the lump sum benefit becomes payable; or(b) for an associate A benefit – the day the benefit is payable; or
(c) in any other case – the day after the day the person ceased to be a member;
and ending on the day on which the lump sum is finally processed.(2) Interest is calculated in relation to a lump sum benefit only if the processing period is greater than 15 working days.
(3) For subsection (2):
(a) the processing period is the period commencing on the day the Board receives all required documentation and information, and ending on the day the lump sum benefit is finally processed; and(b) the Board is taken to have received all required documentation and information only when the last part of the required documentation and information is received by the Board; and
(c) an action performed by ComSuper in relation to the processing of a lump sum benefit is taken to have been performed by the Board.
THE CONTENTIONS
14 The applicant contends that under rule 40(1) a benefit becomes payable on the death of a member survived by a spouse. It says that subrule (3) is concerned with the calculation of the amount of the benefit, and thus so is subrule (4). The applicant submits that the Tribunal’s characterisation of the mitigating circumstances decision as an "ancillary decision" that is required to be made before the balance of the benefit became payable is wrong. It is wrong because the benefit, calculated under subrule (3), was payable under subsection (1). The applicant says that subrule (3) confirms what is implicit in subrule (1), that the benefit is payable, in this case, on the date of the member’s death survived by a spouse. This, it claims, appears from the words of subrule (3) – "calculated as if, on the date of death ... he or she had become entitled to invalidity benefits ...".
15 The Board’s case turns largely on its submission, which the Tribunal accepted, that Batt covers the present case and the Tribunal was bound to follow it. It is necessary therefore to ascertain what that case decides.
BATT
16 In Batt the Tribunal determined that Mr Batt be reclassified for pension entitlements and that the Board pay him interest on the difference between his original (B class) and reclassified (A class) pension amount for a specified period. The Board’s appeal from this decision as to interest was upheld by Kenny J on the ground that the decision under review by the Tribunal was that of the Incapacity Classification Committee, and that body did not have power to approve an increase, by an amount of interest, in the rate of pension payable. Accordingly the Tribunal had exceeded its powers in making an award that was not within the power of the original decision maker: see [45].
17 Justice Kenny went on to say that if, contrary to her opinion, the Tribunal did have power to award interest, she would not have been satisfied that the requirements of rule 69(2) were satisfied. The crux of her Honour’s reasoning is contained in [50] to [51]:
Rule 69(2) permits an approval of an award of interest in the rate of the pension to a pensioner for such period as the decision-maker determines if two conditions are satisfied. The first is that a pension is payable and the second is that the commencement of the payment of that pension is delayed. .... Under rule 26, a person who is classified as Class A or Class B under rule 22 ... is entitled to invalidity benefits in accordance with Subdiv B of Div 2 of Pt 3 of the Rules. An invalidity pension, as defined in the Rules, is a pension payable under rule 27 or 28 (which appear in Subdiv B of Div 2 of Pt 3). A pension, as defined in the Rules, is a pension payable under the Rules. It is plain enough from this that the pension payable to a person on a Class A classification is not payable to the person until the person is classified as Class A under rule 22. Mr Batt was not classified as Class A until the Tribunal made its decision on 31 October 2001. It follows that, under the Rules, it is only on and from this date that it is possible to say that a pension is payable to Mr Batt on a Class A classification.18 At [55] her Honour set aside the Tribunal’s determination "for the reasons stated", and declared that there was "no power in the Tribunal" to approve an increase, by an amount of interest, in the rate of pension payable. The natural reading of this paragraph is that it is a reference back to her Honour’s holding at [45] that the Tribunal had no power to award interest under rule 69(2). Conformably with this, the headnote in the Federal Court Reports records only this holding.
19 In Jacobs v London County Council [1950] AC 361 at 369 Lord Simonds said:
There is in my opinion no justification for regarding as obiter dictum a reason given by a judge for his decision because he has given another reason also.In Commissioners of Taxation (NSW) v Palmer [1907] AC 179 at 184 Lord Macnaghten for the Privy Council said:
It is impossible to treat a proposition which a court declares to be a distinct and sufficient ground for its decision as a mere dictum, simply because there is another ground stated upon which, standing alone, the case might have been determined.20 In McBride v Monzie Pty Ltd [2007] FCA 1947 Finkelstein J said at [6]:
The ratio of a case is the ruling on a point of law upon which the judge acts to reach his (or her) conclusion: Cross & Harris, Precedent in English Law (4th ed, 1990) at 72. If a judge gives two or more alternative reasons for reaching his (or her) decision each reason is part of the ratio ... Bristol-Meyers Squibb Co v F H Faulding & Co Ltd [2000] FCA 316; (2000) 97 FCR 524, 570-571. There may be some cases where the judge gives additional reasons but indicates that he does not wish them to be part of the ratio and is merely wanting to have his views recorded for the benefit of those who may later be required to consider the point. In that event, what the judge says is not part of the ratio: Behrens v Bertram Mills Circus Ltd [1957] 2 QB 1, 25.21 The applicant contended that the only reason was that given by Kenny J at [45] of Batt. The Board asserted that she gave two reasons. If two, the Tribunal was right to say that it "must follow" Batt. If the only true reason for decision was that recorded at [45] of Batt, the Tribunal should still have followed her Honour’s considered opinion on the interest point. There was no other authority available on that question. In Brunner v Greenslade [1971] Ch 993 at 1002-1003 Megarry J said:
A mere passing remark or a statement or assumption on a matter that has not been argued is one thing, a considered judgment on a point fully argued is another, especially where, had the facts been otherwise, it would have formed part of the ratio. Such judicial dicta, standing in authority somewhere between a ratio decidendi and an obiter dictum, seem to me to have a weight nearer to the former than the latter.Writing of "varying degrees of authority of dicta", Cross and Harris say:
It is a truism upon which there is no need to enlarge that dicta are of various degrees of persuasiveness. At one end of the scale we have the considered opinion of all members of the House of Lords who sat to hear a case. At the other end of the scale we have broad observations made on the spur of the moment such as the remark which prompted Lord Abinger to say ‘It was not only an obiter dictum, but a wide divaricating dictum. Dicta of the highest degree of persuasiveness may often, for all practical purposes, be indistinguishable from pronouncements which must be treated as ratio decidendi ....Precedent in English Law 4th ed (1991) at 77.
22 I deal at [24] with the applicant’s submission that Batt was wrongly decided. Assuming for the present that it was not, the question for me is whether the Tribunal erred in following Batt. In my view it did not, whether what Kenny J said about interest was one of the reasons (rationes) for her decision or was strictly obiter. It is not necessary to decide whether her Honour gave one or two reasons for her decision.
23 I do not accept the applicant’s submission that the Tribunal was not bound to follow Batt because, not being a court, it is not bound by the doctrine of precedent. In the use of its own precedents the Tribunal is in a different position from a court. A court may be bound by the rules of precedent to decide a case in accordance with an earlier decision, whether or not the result accords with the court’s own opinion. But an administrative body which acts in that way in deference to an earlier decision of its own may thereby commit reviewable error. It is not allowed to pursue consistency at the expense of the merits of individual cases. Cf Wade and Forsyth, Administrative Law 9th ed (2004) at 325, 931. However, that principle has no application to the Tribunal’s obligation to follow decisions of this Court, whose decisions under ss 39 and 46 of the Act provide the Tribunal with authoritative guidance as to the law. See Cross and Harris, op cit, at 124, citing Chief Supplementary Benefit Officer v Leary [1985] 1 WLR 84 at 89. If the applicant’s submission were correct, the Tribunal could, without committing correctible error, decline to follow this Court’s decision on a question referred to it by the Tribunal under s 39, or indeed a unanimous decision of the High Court. In my view the observations of Megarry J quoted at [21] have added weight in relation to an administrative body such as the Tribunal.
24 In counsel’s written submissions it was asserted that Batt was wrongly decided. When asked whether the real point was whether Batt was distinguishable, counsel replied that she did not withdraw the submission that Batt was wrong, but that the principal contention was that it was distinguishable. I do not consider the claim that Batt was wrongly decided is an available submission. A judge should follow an earlier decision of another judge of this Court unless satisfied it is plainly or clearly wrong. In BHP Billiton Iron Ore Pty Ltd v National Competition Council (2007) 162 FCR 234 at [83] to [84] Greenwood J, with whom I agreed, said:
The circumstances in which a judge in the exercise of the Court’s original jurisdiction might find a decision of a single judge of the Court to be ‘plainly wrong’ should be approached with real and deliberative caution and would generally involve that class of case where for one reason or another there is transparent error such as the consideration of an incorrect statutory instrument in the resolution of the controversy; consideration of a provision of a statute in a form not enacted at the relevant date of the events or a failure to consider a provision of an Act relevant to the disposition of the cause, thus causing the analysis to fall into error; a failure to apply having regard to the issues raised by the controversy, a binding decision of a Full Court of this Court or the High Court; a failure to apply a decision of a Full Court of this Court, an intermediate Court of Appeal of another jurisdiction or an authority of the High Court expressing a clear persuasive emphasis of opinion in favour of a particular conclusion (particularly concerning legislation of the Commonwealth Parliament); or some other circumstance that has caused a dispositive adjudication of the controversy to miscarry. That minds might differ on a question is not a foundation for a conclusion that a decision supported by exposed reasons for judgment after full argument, is plainly wrong.25 Nothing was put to me that suggested that Batt was plainly wrong in any of the respects instanced by Greenwood J, or in any other respect.
26 The applicant contends that Batt is distinguishable because there the entitlement to a benefit arose only upon classification. In the present case, it is said that entitlement arose on the deceased’s death leaving a spouse. I do not think Batt is distinguishable. As from the deceased’s death the applicant was entitled to his employer benefit. The amount of the benefit was to be calculated under rule 40(3) unless the deceased had been absent without leave for a period exceeding 21 consecutive days: rule 40(4). The deceased had been so absent. However, if the Board was satisfied that the absence was due to sufficiently mitigating circumstances, the benefit was to be calculated under s 40(3). In order for the more favourable benefit to be payable there had to be a determination by the Board, or by the Tribunal standing in its place, that the deceased’s absence was due to sufficiently mitigating circumstances. I can see no difference between the need for that determination to be made before the larger benefit became payable and the need for classification to be made in Batt before the more generous pension became payable.
27 Section 41(3) of the Act provides that a decision by the Tribunal in substitution for a decision of a trustee is taken to be a decision of a trustee which, on the coming into operation of the Tribunal’s decision, has effect on and from the day on which the original decision has or had effect. In Batt at [53] and [54], referring to s 41(3), Kenny J said:
The fact that pursuant to statute a decision of the Tribunal would ordinarily take effect at a date prior to its decision on classification does not alter the fact that the pension at the reclassified rate is payable only from the date of the decision of the Tribunal. Further, the fact that the reclassification is to take effect from a date prior to a reclassification does not entail the consequence that the commencement of the payment of the pension at the reclassified rate is ‘delayed’ for the purpose of rule 69(2). In order for there to be a relevant delay in the commencement of the payment of the pension that is payable, there must be a classification or reclassification decision that makes the pension payable and delay between the date of this decision and the first payment of the pension in accordance with the Rules (and the decision). The period between the date of reclassification and the date on which, in the ... Act or under the Rules, the reclassification takes effect is not a period of delay in respect of any instalment of the pension within rule 69(4). This is because no right to receive the pension at the reclassified rate arises before the decision on classification or reclassification is made.Those observations are applicable to the Tribunal’s decision in October 2005 that the deceased’s absence was due to sufficiently mitigating circumstances.
CONCLUSION
28 The applicant’s oral argument was not directed to the numerous grounds of appeal. I have thus far dealt with the argument in the manner in which it was put to me. In the following paragraphs I will deal, as briefly as I can, with the various grounds.
Ground 1: Tribunal’s decision to treat complaint as withdrawn not authorised by s 22(3)(b)
29 I have taken into account that a decision summarily to terminate a proceeding should be made only in a clear case. However, having regard to Batt, the Tribunal was entitled to conclude that the applicant’s complaint was misconceived. The course it took was authorised by s 22(3)(b).
Ground 2: Tribunal had no jurisdiction to make its decision
30 I refer to what I have said about ground 1.
Ground 3: Tribunal erred in deciding there were two parts to the benefit
31 In a case where the Board is satisfied that a member’s absence was due to sufficiently mitigating circumstances, or where at the date of the member’s death the member was not absent without leave, the spouse would be entitled to one payment calculated under rule 40(3). There would be no occasion to separate it into its component parts. But here, the Board was not relevantly satisfied, and its decision was successfully challenged before the Tribunal. The applicant was then entitled to be paid the difference between the benefit she received on 4 May 2004 and the total employer benefit under s 40(3). As a matter of fact, in the events that happened, the applicant was entitled to two payments. It is irrelevant that, had the Board been relevantly satisfied, the applicant would only have received one payment. The obligation to make the second payment did not arise until 1 November 2005, when the Tribunal’s determination was received by the Board. That is the date from which any delay in payment is to be measured.
Ground 4: Tribunal erred in deciding that the balance of the benefit was only payable "where there were sufficiently mitigating circumstances"
32 The Tribunal did not so decide. Its decision was based on the need for a determination that such circumstances existed. The concluding words of s 40(4) are "unless the Board is satisfied that the absence of the member was due to sufficiently mitigating circumstances".
Ground 5: Tribunal erred in holding that the second part of the benefit was not payable until the Board or the Tribunal determined that mitigating circumstances existed
33 The Tribunal did not so err. See [26].
Ground 6: Tribunal erred in deciding that the existence of mitigating circumstances was an ancillary decision to be made before the balance of the benefit became payable
34 There was no such error. A decision of the Board, or of the Tribunal in its place, that mitigating circumstances existed, was required before the balance of the benefit became payable. Nothing turns on the Tribunal’s use of the word "ancillary". The Tribunal could have used any description to indicate that some positive determination as to satisfaction had to be made before the balance of the benefit became payable.
Ground 7: Tribunal erred in deciding that Batt was not distinguishable
35 It did not so err. See [26] and [27].
Ground 8: Tribunal erred in deciding that it must follow Batt
36 It did not so err. See [21] and [22].
Ground 9: Tribunal erred in deciding that application misconceived
37 I refer to what I have said about ground 1.
38 The application is dismissed with costs.
|
|
|
|
Solicitor for the Applicant:
|
Maurice Blackburn
|
|
|
|
|
Counsel for the Respondents:
|
A Dillon
|
|
|
|
|
Solicitor for the Respondents:
|
Australian Government Solicitor
|
AustLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/939.html