'O6l&2, CATCHWORDS REPATRIATION - Tribunal's assessment of the extent of the applicant's incapacity - failure to consider diminution of earning ability occasioned by an accepted vhysical medical condition - "incapacity" - "underlying and persisting loss of confidence" - stress - unable to work. Repatriation Act 1920, s.107V2ZH, Schedule 2 Repatriation Act Amendment Act, 1978, s.40, sub-s. 40(4) (a) Repatriation Commission v. Moss applied HERBERT AUSTIN INGLIS v. THE REPATRIATION COMMISSION Qld G26 of 1983 FITZGERALD J. BRISBANE 31 MAY 1983 IN THE FEDERAL COURT OF AUSTRALIA ) QUEENSLAND DISTRICT REGISTRY ) Qld G26 of 1983 GENERAL DIVISION ) BETWEEN: HERBERT AUSTIN INGLIS Appellant AND: THE REPATRIATION COMMISSION Respondent ORDER JUDGE MAKING ORDER: PITZGERALD J. DATE OF ORDER: 31 MAY 1983 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The Appeal is allowed. 2. The decision appealed from is set aside. 3. The matter is remitted to the Tribunal to be determined according to law with or without hearing such further evidence as 1t may decide to receive. 4. The respondent pay the applicant's taxed costs of and incidental to these proceedings. IN THE FEDERAL COURT OF AUSTRALIA ) QUEENSLAND DISTRICT REGISTRY ) Qld G26 of 1983 GENERAL DIVISION ) BETWEEN: HERBERT AUSTIN INGLIS Appellant AND: THE REPATRIATION COMMISSION Respondent FITZGERALD J. 31 MAY 1933 REASONS FOR JUDGMENT This is an appeal by Mr Inglis on a question of law from the Repatriation Review Tribunal. The material decision of the Tribunal was delivered on 5 January 1983 The Court is empowered by s.107V22H of the Repatriation Act 1920 ("the Act") to make such order as it thinks appropriate uncluding an order affirming or setting aside the decision of the Tribunal or an order remitting the case for redetermination. Mr Inglis is almost 79 years of age. He has had pulmonary tuberculosis which is now inactuve. Ie was first awarded a pension under the Act in respect of pulmonary tuberculosis in 1947. For about thirteen years thereafter, he lived 1n the country and did not practice his profession as a solicitor. In 1960 he returned to his profession where he experienced stress which led to neuro-dermatitis. Over a period of years, he reduced the extent which he worked and in 1973 he finally ceased work altogether. ae Since 1947, Mr Inglis has made a number of claims for pension under the Act. It 1s necessary to refer only to two of the claims which he made prior to November 1979. By a decision of 29 April 1969, the Repatriation Board rejected a claim by Mr Inglis to a pension in respect of generalised osteo-arthritis and chronic eczematoid dermatitis. The medical practitioners who saw Mr Inglis in connection with that claim 1ncluded Dr R. James, a psychiatrist, and Dr Archibald, a dermatologist. Because of the reliance each party to these proceedings placed upon Dr James' report, which was dated 1 April 1969, it 1s appropriate to set 1t out in full. Dr James said: "He was seen in connection with his claim for Anxiety Neurosis. He told me that after the war years he had been T.P.I. because of Tuberculosis. He had worked as a postmaster for a ten year period. He said that because of his Tuberculosis he was not fit for more competitive work situations. In 1960 he developed Arthritis and this began to cause him some trouble. He returned to his employment as a solicitor in 1960 and worke@ at Chinchilla. In 1961 he moved to the Gold Coast and worked as a solicitor in a legal firm during 1962. He worked for a period of 12 months. During this time he developed some Neurodermatitis. At the end of this time he had a one month period at the Kenmore Hospital. He was treated with tranquillizers and bed-rest, and his Neuro- dermatitis cleared up. He then resumed work but reduced his working week to four days. The rash continued to occur, and it was relieved by holidays, amytal, and local ointment. In 1968 he developed some respiratory infections and further reduced his working week to three days. We finished his work at the end of 1968 and has not since been employed. He told me that he had applied for T.P.I. but he had been rejected. He then said that cver since he had the Tuberculosis he had not bcen able to stand up to competitive work. 3. He is a 65 year old married man and there are no domestic difficulties. Ie told me that he did not regard himself as having any nervous symptoms. He had not suffered from any nervous disorder during his war years. There is no diagnosable psychiatric disorder. The symptoms that he mentions are related to his chest condition and arthritis." The "chest condition" referred to was Mr Inglis' pulmonary tuberculosis. Dr Archibald reported on 11 April 1969 that Mr Inglis had been suffering from recurrent ncuro- dermatitis and said that he thought that 1t was Likely that that condition had been exacerbated by stress associated with Mr Inglis' work. On 9 July 1971, Mr Inglis applied for a pension on the basis that he was totally and permanently incapacitated. He was seen by a general practitioner, Dr Dick, who, on 19 July 1971, completed two separate departmental forms, a medical report and a medical report on capacity to work. Dr Dick reported that Mr Inglis was permanently unable to work. He stated that Mr Inglis' accepted disability was not the sole reason for his inability to work; it was partly due to bad nerves which made it difficult for Mr Inglis to cope with the anxieties of his work. Mr Inglis' "accepted disability" at that time was pulmonary tuberculosis. The decision of the Repatriation Board, dated 5 November 1971, was to continue the pension in respect of pulmonary tuberculosis which Mr Inglis was then receiving. Mr Inglis continued to receive that pension in respect of pulmonary tuberculosis until November 1979. On 2 November 1979, the Repatriation Commission reviewed that pension pursuant to the provisions of s.40 of the Repatriation Act Amendment Act 1978. The medical evidence establishes that Mr Inglis does not, and at November 1979 did not, have any physical disability from pulmonary tuberculosis. The Commission determined that Mr Inglis' incapacity in respect of pulmonary tuberculosis was negligible and that his pension in respect of pulmonary tuberculosis should be reduced from 29 November 1979 to the rate provided for in para. 40(4) (a) of the 1978 Amendment Act ("the frozen rate"). The Repatriation Commission, the respondent to this appeal, does not dispute that Mr Inglis still retains an entitlement to that pension. However, by a letter dated 28 January 1980, Mr Inglis sought to have the Repatriation Commission's decision of 2 November 1979 reviewed by a Repatriation Review Tribunal. On 1 September 1981, on a review sought by Mr Inglis earlier that year of the decision of the Repatriation Board on 29 April 1969 in relation to his claim for a pension in respect of generalised osteo-arthritis and chronic eczematoid dermatitis, the Repatriation Commission 5. accepted that Mr Inglis had an incapacity in respect of an osteo-arthritic condition in his hands which entitled him to a pension under the Act. That decision stands and is not questioned. By letter dated 9 October 1981, the Repatriation Commission wrote to Mr Inglis in the following terms: "Dear Mr Inglis In your letter dated 28 September 1981, you mention discussing your newly accepted disability Nodal (Primary) Osteoarthrosis Hands with the Repatriation Review Tribunal when it hears your application for review of the Repatriation Commission's decision of 2 November 1979 assessing Pulmonary Tuberculosis. Unfortunately, when the Tribunal hear that case they will be assessing only whether on 2 November 1979 the decision made on that date was a valid one. Incapacity accepted aS service-related subsequent to the Commission's decision, by law, cannot be considered by the Tribunal. At present, a composite assessment of your incapacity arising from service-related disabilities, uncluding your newly accepted disability, 21s being prepared for submission to the Repatriation Board. If you are not satisfied with that decision when it 1s made you will then have another separate right of application to the Tribunal in respect of that decision. I hope that this information clarifies the position for you. ..." On 28 October 1981, the Repatriation Commission ° assessed the pension to which Mr Inglis was entitled at 20% of the general rate. The general rate is the basic rate of pension which 1s payable on total incapacity and 1s specified in column 3 of schedule 1 to the Act. That assessment was, no doubt, the "composite assessment" referred to in the letter from the Commission dated 9 October 1981. The Commission again accepted that Mr Inglis had no physical disability from pulmonary tuberculosis and held that pulmonary tuberculosis did not contribute to his incapacity which it held was referable to his osteo-arthritic hands. Twenty percent of the general rate 1s less than the frozen rate. The Repatriation Commission concluded its decision: "The Commission 1s satisfied beyond reasonable doubt that the extent of incapacity should be determined to be TWENTY percent of the general rate of pension, The frozen 'May 1978 One Hundred percent level' of pension will however continue." On or about 18 November 1981 Mr Inglis lodged an "Application for Increased Rate of Payment of War Pension" on a form approved for use "only for disabilities already accepted as due to war service". The grounds stated for the application were as follows: "On the hearing of a previous application for increase of my pension entitlement to Totally and Permanently Incapacitated the report of a Departmentally engaged specialist was that my inability to work was due to pulmonary tuberculosis and arthritis. Arthritis (from which I have suffered ever since I contracted 1t while on active service with the R.A.A.F. in the Second World War) has now been accepted by the Repatriation Commission as contracted on such service and I now again apply for the Totally and Permanently Incapacitated Pension." That application has .been treated by both parties as a request by Mr Inglis to have the Repatriation Commission's decision of 28 October 1981 reviewed by a Repatriation Review Tribunal. On 6 September 1982, the Repatriation Review Tribunal affirmed the Repatriation Commission's decision of 2 November 1979. The Tribunal had available to it a report dated 2 June 1982 of a thoracic surgeon, Dr Jackson, "that the accepted disability of Pulmonary Tuberculosis would not reduce (Mr Inglis') ability to obtain employment as a solicitor". On 5 January 1983, the Tribunal affirmed the Commission's decision of 28 October 1981. The appeal to this Court is brought from the latter decision of the Tribunal. In his submissions to the Repatriation Review Tribunal prior to its decision on 6 September 1982, Mr Inglis relied on medical opinion that patients suffering pulmonary tuberculosis should not engage in employment which causcs 8. either physical or mental stress, including a warning © to that effect which he said had been given to him by one of the Repatriation Commission's medical experts in 1964. In his submissions to the Repatriation Review Tribunal prior to its decision of 5 January 1983, he also relied upon the reports of Drs James, Archibald and Dick, which were amongst numerous reports obtained by the Repatriation Commission 1n connection with earlier pension claims by Mr Inglis The reports of the three doctors in question were recorded or summarised in the decision. The basis of Mr Inglis' submission to the Repatriation Review Tribunal prior to its decision of 5 January 1983 is to be found in the following passage: "I claim that the mental disability to handle the stress of my profession and the physical distress that accompanies 1t arose from the disease of pulmonary tuberculosis that I suffered during and after my war service. I submit that the report of Dr James supports this claim." Mr Inglis implied that his pulmonary tuberculosis had produced an "underlying and persisting loss of confidence or mental facility ... resulting in diminished earning ability", quoting a passage from the judgment of Deane J. and myself in Repatriation Commission v. Moss (1982) 40 A.L.R. 553 at p.567 (25). As I understand his contention, this loss of confidence in turn caused the stress which has rendered him unable to work as a solicitor. 9. The Tribunal, in its decision of 5 January 1983, - after referring to what Mr Inglis had submitted, said: "The Tribunal takes it to mean that Mr Inglis is submitting that at the time of the Commission's decision of 28 October 1981 he had an underlying and persistent loss of confidence which resulted in diminished earning ability. However, he does not have any psychiatric disorder accepted as a service related incapacity; nor has he made any claim, under s.24AA of the Act, that he is suffering incapacity from an underlying and persistent loss of confidence or mental facility. As it has not been established in terms of S.101 of the Act that he has any entitlement to pension in respect of a psychiatric disorder, or the like, this Tribunal does not consider that it should consider this aspect of his submission any further. The Tribunal as presently constituted is only empowered to deal with pension assessments not pension entitlement." Both parties accepted before me that the Tribunal was correct in the passage quoted if and insofar as it concerned psychiatric disorder viewed as a separate disability. However, that was not and 1s not Mr Inglis' case. He asserts that, although he otherwise does not have any psychiatric disorder, he has an underlying and persistent loss of confidence which has arisen from his pulmonary tuberculosis and that his lack of confidence is the cause of the stress which renders him unable to work. 10. It was not in dispute that the task of the Tribunal in arriving at its decision of 5 January 1983 was to review, under s.107VD of the Act, a decision of the Commission by which the rate of pension payable in respect of Mr Inglis' incapacity had been assessed. The parties were in agreement that the Tribunal was confined in its deliberations to the particuJar ailments which had been accepted; that is to say, pulmonary tuberculosis and osteoarthritis. Each 1s, of course, a physical rather than a mental disorder. Generally speaking, pension is not payable in respect of ailments as such but in respect of incapacity: see e.g. s.101 of the Act. A decision as to the rate of pension payable necessitates a determination of the nature and extent of the ancapacity of the person to whom the pension 1s payable. It 1s obvious that, at least in the case of a disease such as pulmonary tuberculosis, the effects of the disease are an aspect of the incapacity. Indeed in Moss, Deane J. and I pointed out at p.566 (25) that one particular consequence of a disorder, namely inability to work, may both manifest incapacity and assist in its measurement. We said: "The judgment 1n Bowman's Case, supra, did not, however, purport to establish, for the purposes of the Act, a clear dichotomy between physical and mental impairment on the one hand and inability to work or earn on the other. To the contrary, 1t was recognized in that case that inability to work or to earn will commonly be a manifestation and a measure of incapacity." il. The whole passage of course assumes that "impairments" which are occasioned by a disease or other ailment, and not merely the disease or ailment simplicater, constitute the incapacity. In my opinion, no justification exists for excluding Matters arising from an ailment from consideration merely because they are not immediately anddirectly related to the accepted medical condition or because they are not of the same character, 1.e. physical or mental as the case may be, as the particular disorder. No more positive statement 15 appropriate and no general formula 1s possible. Obviously, there must be questions of degree involved. However, the passage in Moss at p.567 which was relied on by Mr Inglis warranted the Tribunal investigating his claim that his pulmonary tuberculosis, although now inactive and creating no physical impairment, had produced in him an underlying and persistent loss of confidence which rendered him unable to cope with stress and thus was the scurce of his inability to work. If his contentions are correct, his inability to work 1s a facet of an incapacity which 1s referable to his pulmonary tuberculosis. Following the passage which has been quoted above, the Tribunal's decision of 5 January 1983 dealt with Mr Inglis' osteo~arthritis and pulmonary tuberculosis viewed as physical disabilities and concluded that Mr Inglis has negligible physical disability from pulmonary tuberculosis. The Tribunal then continued - 12. "The Repatriation Act, un broad terms, provides for two types of pensions: 1. Pensions which are granted for having been disabled by war service and which are proportional to the degree of physical or mental incapacity existing at any particular time. (These are pensions at or below the General Rate provided for in Schedule l to the Act). 2. Rates higher than the General Rate which are related to capacity to earn and hence ability to work. These rates are the so called Intermediate Rate, Temporarilly Totally Incapacitated Rate, and ''otally and Permanently Incapacitated Rate. The relationship between the two types of pension 1s that until incapacity under the General Rate has been assessed at the maximum level within that Rate (i.e. one hundred per centum) the affected member cannot be considered for any of the ""earning-capacity" related pension rates. This 1s so even if as claimed by Mr Inglis the effect of his pulmonary tuberculosis is to diminish his earning ability. In short, under the General Rate, incapacity 1s measured only in terms of physical or mental disability without reference to consequential financial loss. Having regard to the findings of the Tribunal on this review, it is not open to the Tribunal to take into account the economic consequences of Mr Inglis' incapacity since it 1s not total under the General Rate pension assessment." 13. There are obvious difficulties in the latter two. paragraphs 1f taken entirely literally. Senior Counsel for the respondent submitted, however, that the Tribunal was correct in its opinion that, even if a person entitled to a pension is incapacitated for life to such an extent as to be precluded from earning other than a negligible percentage of a living wage, he or she 1s not totally and permanently incapacitated within the meaning of Schedule 2 to the Act unless his or her incapacity, including that inability to earn, is such that he or she is, or apart from Schedule 2 would be, entitled to 100% of the general rate of pension on total incapacity under Schedule 1 column 3 (see also Schedule 3 Table B). The submission is not without substance. For example, there 1s force in an argument that Schedule 1 clause 3 is concerned with temporary total (as distinct from partial) incapacity and that Schedule 2 1s complementary to Schedule 1 clause 3 in that it makes provision as to the pension payable when the total incapacity which precludes the earning of other than a negligible percentage of a living wage 1s permanent not temporary. On the other hand, if such an interpretation of Schedule 2 presupposes that an incapacity IMay permanently preclude a person cntitled to a pension from earning other than a negligible percentage of a living wage yet not provide an entitlement to 100 percent of the general rate of pension or to a special rate of pension under Schedule 2 it would be capable of bizarre consequences. It would be curious indeed if this nation by its Parliament had intended that an incapacitated ex-serviceman or ex-servicewoman who was permanently unable to earn more than a negligible percentage of a laving wage was not entitled to a total and permanently 14. incapacitated pension merely because he or she still retained the capacity to perform some other function however minimal. Although no doubt Schedule 2 must be read with the other schedules as part of the entire Act, the better view of its operation seems to me to be that Schedule 2 1s self-contained and defines its own test for the Special Pension for which at makes provision: cf Moss per Fox J. at p.558. The explanation may lie in a proper understanding of the concept of "Total incapacity". As Deane J. and I pointed out in Moss at p.564 "Total incapacity" 1s undefined but the Schedules proceed on the basis "that the condition may and perhaps often will exist although the person entitled to the pension is able to engage in a remunerative occupation and earn a living wage". Presumably, therefore, "Total incapacity" can exist although the person entitled to the pension can still perform some other functions and would in such circumstances exist if such a person was, by reason of incapacity, permanently precluded from earning other than a negligible percentage of a living wage. In any event, although Mr Inglis" primary contention was that he was entitled to a pension at the Special Rate under Schedule 2, the Tribunal's function was not limited to accepting or rejecting that claim. Even if Mr Inglis did not have total incapacity, the Tribunal was required to assess what degree of incapacity he did have in order to decide the rate of pension to which he was entitled. It will be obvious from what I earlier said in relation to the 15. first passage quoted above from the Tribunal's decision that I am of the opinion that the Tribunal was in error in excluding from its assessment of the extent of Mr Inglis' ancapacity any diminution (or extinction) of his earning ability which was occasioned by his pulmonary tuberculosis. Such an approach seems to me inconsistent with what was said in Moss. The Tribunal in this case simply did not investigate whether or not Mr Inglis was able to work and, 1f not, what if any connection existed between that circumstance and the pulmonary tuberculosis which he had suffered. The respondent Repatriation Commission nonetheless sought to uphold the Tribunal's decision on the basis that not only was there no evidence to support Mr Inglis' claim but that the evidence was such that satisfaction beyond reasonable doubt that his claim failed was the only available conclusion. Thus, it was submitted, the Court should dismiss the appeal. For Mr Inglis, the converse submission was made that the evidence was such that it was impossible for the Tribunal to be satisfied beyond reasonable doubt that the Commission's decision was correct: sub-s. 107VH(2). Each party relied on what was submitted to be the correct interpretation of the 1969 and 1971 medical reports particularly the report of Dr James of 1 April 1969. 16. The present proceedings are concerned with Mr Inglis' conditon in October/November 1971. Mr Inglis was then about 67 years of age. The assumption which underlies his claim is that despite his age, he would then have been able to work as a solicitor but for the stress the work would cause. He had not worked for more than 10 years. He did not have active pulmonary tuberculosis. He had no nervous disorder, whether from stress or otherwise. The most that can be said is that, had he then otherwise been able to work and to find employment as a solicitor, he might have been prevented from doing so by stress. Mr Inglis' assertion 1s that the stress would have been caused by "an underlying and persisting loss of confidence" which had in turn been caused by pulmonary tuberculosis. He seeks support for that proposition in his construction of Dr James' report. Even 1f pulmonary tuberculosis may produce or contribute to neurotic symptoms, which, if they result, may render the sufferer unemployable or unemployable in a partacular occupation, or 1f employment which is productive of physical and mental stress may be denied to sufferers of pulmonary tuberculosis because of the adverse effect which the stress may have upon their health, 1t would not be difficult to be satisfied that Mr Inglis had no incapacity referable to pulmonary tuberculosis. 17. Obviously, therefore, the order primarily sought by Mr Inglis on this appeal, namely an order that he be granted a pension on the basis tnat he is "totally and permanently incapacitated" cannot be made. lIlowever, he asks in the alternative for an order that the matter be remitted to the Tribunal and decided according to law with or without hearing further evidence. In my Opinion, that is the appropriate course. Although, so far as I have said, a conclusion adverse to Mr Inglis was quite open to the Tribunal, I am not prepared to say that the material is such that it must have arrived at such a conclusion. There 18 nothing to aundiecate what view the Tribunal took of Dr Janes' critical report. It was a decade out of date. It was not primarily directed at the presently important questions and, if not ambiguous, was elliptical. 'There has been no properly directed investigation. It would be more consonant with the objectives of this legislation for the appointed Tribunal to reconsider the matter de novo on the proper basis and with adequate material than for the Court to reach a conclusion on the foundation of limited material which is, so Far, the only material because the real 1ssues have not boen appreciated. 18. The order of the Court 1s therefore that the matter be remitted to the Repatriation Review T'ribunal and decided by 1t according to law with or without hearing such further evidence as it may decide to receive. The respondent, the Repatriation Commission, must pay the applicant's costs of and incidental to the proceedings in this Court. beath that oor th U7 pPowl a Te - piblgrrers eet par duster ur. atewth, & Darwen Oatea Jr May, (783 Aa x ny " RL Ta