ara JUDGMENT No. 1.5232. suelo CATCHWORDS DEF DWAR - Veterans' entitlements - disability pension - extent of fTribunal's powers when hearing and determining a matter remitted to it by the Court - application of issue estoppel to the Tribunal - effect of s 120 of the Veterans' Entitlements Act 1986 (Cth) Veterans' Entitlements Act 1986 (Cth) s 7(1)(a) and (b), 9(1)(a) and _(b), 24, 120 Blackman v Commissioner of Taxation (1993) 43 FCR 449 Bushell v Repatriation Commission (1992) 175 CLR 408 Byrnes v Repatriation Commission (1993) 177 CLR 564 Langley v Repatriation Commission (1993) 43 FCR 194 Nation v Repatriation Commission (1993) 18 AAR 273 LIONEL NATION v REPATRIATION COMMISSION No TG 18 of 1994 NORTHROP J HOBART 7 DECEMBER 1994 29 DEC 1994 FEDERAL COURT OF AUSTRALIA PRINCIPAL rer IN THE FEDERAL, COURT OF AUSTRALIA TASMANIA DISTRICT REGISTRY No TG 18 of 1994 GENERAL DIVISION ON APPEAL FROM THE VETERAN'S DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY MR_A.M. BLOW - DEPUTY PRESIDENT BETWEEN: LIONEL NATION Applicant AND: REPATRIATION COMMISSION Respondent COURT: NORTHROP J PLACE: HOBART DATE : 7 DECEMBER 1994 MINUTES OF ORDER THE COURT ORDERS THAT: The appeal be allowed with costs. The decision appealed from be set aside and in lieu thereof it be declared that the applicant's obsessive compulsive neurosis is a war-caused disease for the purposes of section 13 of the Veterans' Entitlements Act 1986. Remit the matter to the Repatriation Commission to determine the rate of pension to be paid to the applicant and the date from which that pension is to be paid. Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules IN THE FEDERAL COURT OF AUSTRALIA TASMANIA DISTRICT REGISTRY , No TG 18 of 1994 GENERAL DIVISTON ON APPEAL FROM THE VETERAN'S DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY MR_ A.M. BLOW - DEPUTY PRESIDENT BETWEEN: LIONEL NATION Applicant AND: REPATRIATION COMMISSION Respondent COURT: NORTHROP J PLACE: HOBART DATE: 7 DECEMBER 1994 REASONS FOR JUDGMENT Two main issues are raised by this appeal. The first issue relates to the nature of the powers of the Administrative Appeals Tribunal when hearing and determining a matter remitted to it by an order of the Federal Court in an appeal from the Tribunal. The second issue relates to the methodology of applying section 120 of the Veterans' Entitlements Act 1986. Initially, a reference to relevant chronological facts relating to the applicant is a useful basis for an understanding of both issues. The applicant is a veteran within the meaning of the Act. He was born on 11 April 1927. On 18 July 1945 he enlisted in --' the Australian Army. He was engaged in operational service outside Australia within the meaning of section 6 of the Act, including service in Japan, between 18 July 1945 and 5 December 1952. While in Japan he was a patient in hospital on two occasions first for five days from 25 June 1948 suffering from tonsillitis and second for five days from 5 December 1950 suffering from laryngitis and rhinitis. On each occasion he had been suffering from a cold for some days before being admitted to hospital. Following his discharge from the Army, the applicant was employed in the State Public Service of Tasmania. From time to time he made successful claims for benefits under the Repatriation Act 1951 but only one of those claims need be referred to for present purposes. Also, he had a history of neurotic diseases including personality disorders. In August 1982 Dr Jones, a surgeon, performed an operation on the applicant's nose, being a bilateral intranasal antrostomy, in an attempt to cure the disease of bilateral maxillary sinusitis from which the applicant was suffering. On 28 February 1983 he made an application for a pension under the Repatriation Act 1920 based on his nasal problems. On 9 September 1993 a Repatriation Board granted the application. In doing so it relied upon the opinion of a departmental medical officer, Dr E.T. Woo. The applicant was granted a pension at 100% of the general rate with effect from 18 November 1982. The reasons for the determination given by the Board are: "This is a claim by the member for acceptance of nose as being service-~-related. He contends that he was hospitalised for rhinitis in 1950. After medical investigation and review of the available medical history, a diagnosis of bilateral maxillary sinustis (sic) was established. In discussing the nature and cause of the incapacity, and the relationship to service, a departmental medical officer has said, in effect: He had rhinitis on 5 December 1950 and this is within the eligibility period. The disability is therefore attributable to service. Extent of incapacity from the disability is nil. His composite assessment, considering all his accepted conditions is one hundred per cent. The Repatriation Board, in view of the evidence, and having regard to the medical opinion expressed, determines that bilateral maxillary sinusitis is related to service and allows the claim within the terms of Section 107C of the Repatriation Act, with effect from 18 November 1982, being a date three months prior to the receipt of the member's informal application, in accordance with Section 107C(5) of the Act. Disability pension continued at one hundred per cent of the General Rate." That determination was not challenged. It has not been set aside. It is still in force. It appears that the applicant is still entitled to the pension so granted. It appears that he is still receiving that pension. The Veterans' Entitlements Act 1986 came into operation on 22 May 1986. By virtue of subsections 4(2)(c) and (11) of the Veterans' Entitlements (Transitional Provisions and Consequential Amendments) Act 1986, the disease forming the basis of the determination in favour of the applicant was and is deemed to be a war caused disease under the Veterans' Entitlements Act. In February 1988 the applicant made a claim seeking the special rate of pension under section 24 of the Veterans' Entitlements Act. This is a pension which is payable to veterans who are totally and permanently disabled within the meaning of the provisions of that section. The claim was based on the disease of obsessive compulsive neurosis which was said to have resulted from the operation performed on his nose in August 1982. On 13 December 1988, the Repatriation Commission refused to grant the claim. On 6 May 1991 the Veterans Review Board affirmed the decision of the Commission. On 25 March 1993, the Administrative Appeals Tribunal affirmed the decision of the Board. The Commission, the Board and the Tribunal considered the matters before them on the basis that the applicant was suffering from a war caused disease for which the applicant underwent the nasal operation in August 1982. The applicant appealed from the decision of the Tribunal. Judgment on the appeal was given on 22 September 1993 and is reported, Nation v Repatriation Commission (1993) 18 AAR 273 ("Nation No 1"). The only issue raised by the appeal, as was the only issue before the Tribunal, related to the chain of causation from the operation to the existing disease of obsessive compulsive neurosis. This involved the construction and application of section 120 of the Veterans' Entitlements Act. The nature of the issue involved is illustrated by the following passage from the judgment at 275: "In the present case, it having been accepted that the nasal operation performed on the applicant was a result of a war-caused disease, the issue was whether the obsessive compulsive neurosis resulted from that operation. For that reason, the normal type of material placed before the Commission (Tribunal) in cases of this kind was not present. The material was limited to the chain of causation from the nasal operation to the existing disease of obsessive compulsive neurosis, an obsession relating to cleanliness." There is no doubt that the same issue was considered by the Tribunal. This is illustrated by the following extract from the reasons for decision given by the Tribunal and as set out in the judgment in Nation No 1 at 282: "It was common ground that the circumstances of the particular service of the applicant had given rise to sinus problems which had necessitated a nasal operation thirty years or so later. It was agreed that bilateral maxillary sinusitis was properly recognized as a war- caused disease about a year after the operation. It was also agreed that the applicant suffered an obsessive compulsive neurosis." The Court allowed the appeal for the reasons expressed in the reasons for judgment. Essentially this was for the reason that the Tribunal had not applied the provisions of section 120 of the Veterans' Entitlements Act in considering the evidence of the medical witnesses on the issue of causation between the operation and the disease. To a large extent this depended upon expert evidence. This is made clear by the passage at 283-4: "It is not necessary to set out the whole of the evidence given by Dr Burgess on this point. The fact that the Tribunal was satisfied beyond reasonable doubt that the applicant had no ritualistic symptoms at all between 1983 and 1985 does not mean that his claim must fail. The Tribunal should have considered the evidence of Dr Burgess in the manner expressed in s120(1) of the Act to determine whether, beyond reasonable doubt, there was no sufficient ground for making the determination. In other words, the Tribunal had to consider the evidence of Dr Burgess to determine whether it was satisfied beyond reasonable doubt that it could not accept the causal connection of Bushell v Repatriation Commission (1992) 175 CLR 408 at 416. This does not depend upon the reliability of the evidence of the applicant. The Tribunal did not do this. This constitutes an error of law. This is a difficult case made more difficult by the cryptic nature of the reasons of the Tribunal. In all the circumstances, in my opinion, it would not be safe to allow the decision of the Tribunal to stand. There is a grave danger that the Tribunal did not apply s 120(1) and (3) of the Act in conformity with the principles expressed by the High Court in Bushell. There is a grave danger that the Tribunal did not have regard to the evidence of Dr Burgess on causation when applying section 120(1). It was led into error on this by the concession wrongly made by counsel." The Court ordered that the appeal be allowed, with costs, that the decision of the Tribunal be set aside and "the matter be remitted to the Tribunal to be heard and determined according to law after admitting such further evidence as it considers appropriate." The "matter" came on for hearing before the Tribunal on 28 March 1994. Further evidence was received relating to the chain of causation from the nasal operation to the disease of obsessive compulsive neurosis. Evidence on other issues was received. On 29 June 1994, the Tribunal announced its decision and published its reasons. In its reasons the Tribunal considered i} the evidence directed to the causation issue and continued: "After consideration of the whole of the material before the Tribunal, I am of the opinion that that material raises a reasonable hypothesis connecting the applicant's obsessive compulsive disorder or neurosis with his nasal operation in 1982. According to Dr Burgess the trigger for such a condition is often something to do with germs, illness, operations or surgery. All of the applicant's ritualistic behaviour appears to be concerned with health issues. This behaviour commenced shortly after the operation and the traumatic post-operative experiences I have referred to. The nasal operation was not the sole cause of the onset of the obsessive compulsive disorder or neurosis, since the pre-existing psychiatric condition no doubt played some part, but I find that it was a substantial contributing cause, and that the obsessive compulsive condition is, in that sense, attributable to it. I will refer to this relevant legal considerations in detail later in these reasons." The methodology adopted by the Tribunal may not have been consistent with the principles enunciated by the High Court in Bushell v Repatriation Commission (1992) 175 CLR 408 and Byrnes v Repatriation Commission (1993) 177 CLR 564, but there is no doubt that the Tribunal made findings in favour of the applicant. On these findings, it would have been expected that the Tribunal would have determined that the decision of the Board be set aside and that the applicant was entitled to the special rate of pension under section 24 of the Veteran's Entitlements Act. The Tribunal did not do this. It affirmed the decision under review namely the decision of the Veterans Review Board disallowing the claim by the applicant for the special rate under section 24. Presumably the applicant remains entitled to his pension under the determination made on 9 September 1983. Immediately following the extract from the reasons of the Tribunal just quoted, the Tribunal said: "It is therefor necessary to consider whether the respondent is bound by the determination by a Repatriation Board in 1983 to the effect that the applicant's bilateral maxillary sinusitis was war-caused and, if the respondent is not, to consider whether that condition was war-caused." There are a number of difficulties inherent in that sentence but they need not be pursued. For present purposes, it is sufficient to say that this sentence gives rise to the first issue raised by this appeal. The applicant has appealed from the decision of the Tribunal made on 29 June 1994. The first issue raised on the appeal involves the nature of the powers of the Tribunal when hearing and determining a matter remitted to it by an order of this Court. The contention of counsel for the applicant was that the "matter" remitted to the Tribunal by the order of the Court in Nation No 1 was limited to the matter then in issue in the Tribunal and the Court namely "whether obsessive compulsive neurosis resulted from" the operation in August 1982. The question of whether the disease which necessitated that operation, namely bilateral maxillary sinusitis, was a war-caused disease was not a matter remitted to the Tribunal by the order of the Court made on 22 September 1993. Thus the decision of the Repatriation Board of 9 September 1983 could not be challenged in the Tribunal in the course of hearing and determining whether the -applicant's present disease resulted from the operation. I propose to consider the first issue now. Counsel relied upon a number of grounds to support his contentions including whether, on the facts of this case, the Repatriation Commission was estopped from raising the issue of whether the sinusitis was a war-caused injury, and whether it was an abuse of power by the Repatriation Commission so to do, but the Court does not find it necessary to consider those grounds. In order to understand the issue, a brief reference is made to the nature of proceedings before the Tribunal. For present purposes it is sufficient to refer to what I said in Nation No 1 at 275-6: "In considering this, it is helpful to keep in mind the nature of the proceedings before the Tribunal when exercising powers of review of decisions of administrators. A very helpful opinion on this matter is contained in the judgment of Brennan J in Bushell. After setting out s120 of the Act (at 424-425; 14) his Honour said: "The section is not concerned with an onus of proof. Subsection (6) says so expressly. It 18 concerned with a standard of satisfaction to which the administrative decision- maker must attain in finding the relevant facts and it directs the decision-maker to act on the material before the Commission, the Board or the AAT, as the case may be. Proceedings before the AAT may sometimes appear to be adversarial when the Commission chooses to appear to defend its decision or to test a claimant's case but in substance the review is inquisitorial. Each of the Commission, the Board and the AAT is an administrative decision-maker, under a duty to arrive at the correct or preferable decision in the case before it according to the material before it. If the material is inadequate, the Commission, the Board or the AAT may request or itself compel the production of further material. The notion of onus of proof, which plays so important a part in fact- finding in adversarial proceedings before judicial tribunals, has no part to play in those administrative proceedings. Nor does 8120 create any presumption which has to be dispelled by the material before the decision-maker." The nature of the function of the AAT as so described puts clearly what was said in McDonald v Director-General of Social Security (1984) 1 FCR 354 per Woodward J at 356-358 and per Northrop J at 365-366 in relation to the function of the AAT." In exercising its powers of veview under' the Administrative Appeals fribunal Act 1975, the Tribunal is exercising the powers of the administrator whose decision is being reviewed. As has been said, the Tribunal stands in the shoes of the original decision-maker but acts on the law and material before it at the time it makes its decision. This is a general principle of law and is illustrated by Re Goldham Ex Parte Brideson (1990) 170 CLR 267. Applying these principles, a Full Court of the Federal Court, by majority, held that the Tribunal had jurisdiction or power so to examine facts relating to an earlier determination relevant to issues before the Tribunal and come to a different conclusion, see Langley v Repatriation Commission (1993) 43 FCR 194 per Lockhart and Beazley JJ. Spender J gave a powerful dissenting judgment. In the present case, I do not need to express an opinion on this question since the issue here is what was the "matter" before the Tribunal. The present case comes within a principle of law expressed by Gray J in Blackman v Commissioner of Taxation (1993) 43 FCR 449. That case involved an appeal from a decision of the Administrative Appeals Tribunal made in a matter which had been remitted to the Tribunal by the Federal Court following an earlier appeal from the Tribunal. At 455-6 Gray J said: "The obligation of the Tribunal to find facts is not diminished where there has been a successful appeal to the Federal Court of Australia under s44 of the Administrative Appeals Tribunal Act. If the court allows the appeal, sets aside the decision of the Tribunal, and remits the case to be heard and decided again, the Tribunal retains its responsibility to find the facts. If, as-is usually the case, the remitted matter is heard and decided by a Tribunal differently constituted from the Tribunal whose decision was the subject of the successful appeal, the differently constituted Tribunal will have to find facts. In the exercise of its powers, and subject to the submissions of the parties, the Tribunal may decide to act on the findings of fact made by the earlier Tribunal, or some of them. It may decide, as the learned senior member did in the present case, to rely upon evidence which was before the earlier Tribunal. It may decide that the proper course is to receive all or some evidence afresh. The parties might agree that some or all of the findings of fact previously made are to be treated as findings of fact by the Tribunal. fMThe order of the Court may limit the ambit of the issues with which the Tribunal is to deal upon a case being remitted. The order of Jenkinson J in the present case cannot be construed as containing such a limitation. The course which the Tribunal takes in relation to any case will depend on the circumstances of that case, but it will be the responsibility of the Tribunal which ultimately decides the case to determine for itself the facts." I accept that statement of principle and turn to consider what was the "matter" remitted to the Tribunal for hearing and determination by the Tribunal. The order remitted "the matter" to the Tribunal. The word "matter" means all things in dispute between the parties. In the Federal Court, the things in dispute were limited to the issue of causation from the nasal operation to the existing disease of obsessive compulsory neurosis. That was the matter remitted to the Tribunal to be heard and determined. Nothing else was . mo remitted. To use the terminology of Gray J, the order of the Court limited the ambit of the issues with which the Tribunal was to deal upon the matter being remitted to the Tribunal. This conclusion is consistent with the views expressed in Repatriation Commission v O'Brien (1985) 155 CLR 422, a judgment relied on strongly by counsel for the respondent and by the Tribunal it its decision. The feature of that judgment of essential relevance to the present appeal is the consideration of the matters then before the Administrative Appeals Tribunal. The provisions of the Repatriation Act then in operation, section 107VZZB, were said at 428-9 to outline: "... with some precision the circumstances in which a decision of the Commission under review by the Review Tribunal may be referred by the president of that Tribunal to the president of the AAT with a request for a review of that decision by the AAT. Subsection (8) obliges the president of the AAT upon receipt of such a request, to direct the review, in accordance with the Administrative Appeals Tribunal Act, of the decision which has been referred to him." In that case five decisions had been referred to the AAT which had considered other decisions which had not been referred. At 429 Gibbs CJ, Wilson and Dawson JJ said: "In the present case, the reference was confined to the five decisions of the Commission whereby on each occasion the respondent's claim for a war pension based on his essential hypertension was rejected. The decision of a Repatriation Board in November 1961 accepting the respondent's anxiety neurosis as due to war service has never been challenged by way of appeal. The same is true of the decision of a Board in 1970 which raised the assessment of his disability in respect of that neurosis oa "from nil to 20 per-cent. Whether or not the Commission whee considered it desirable to do so, in our opinion it was not open for these earlier decisions to be reviewed and reversed in the course of considering the respondent's claim based on his hypertension. Neither of these earlier decisions was embraced within the reference to the president of the AAT, The AAT therefore had no jurisdiction ta review either of those decisions: Administrative Appeals Tribunal Act, s25." Later, on the same page, their Honours said: "It follows that the first of the two basic issues which the parties chose to contest in the AAT was misconceived. It was an issue which the AAT had no power to entertain. The real issue was the connexion, if any, between the accepted disability of anxiety neurosis and the essential hypertension. It was not suggested by the respondent that there was any other basis on which he could claim his hypertension was attributable to his war service." That authority is not directly applicable to the facts of the present case. Here, the claim by the applicant in February 1988 was for a special rate of pension under section 24 of the Veterans' Entitlements Act. At all times, the only issue raised by the claim before the Commission, the Veterans Review Board, the first review before the Tribunal and the Federal Court related to the "chain of causation from the nasal operation to the existing disease of obsessive compulsive neurosis". That was the "matter" in issue. I have concluded that that was the "matter" remitted to the Tribunal for hearing and determination. By analogy, the views expressed in O'Brien, as set out, support the view that that was the only "matter" to be heard and determined by the Tribunal and that accordingly the Tribunal, on the remittal, could not consider other matters and in particular the matter of whether the bilateral maxillary sinusitis was a war caused disease. This view appears to be consistent with the views of Lockhart and Beazley JJ in Langley. At 119 to 120, their Honours considered O'Brien, quoted one of the passages from that decision set out above, and continued: "In our opinion, the majority of the High Court held in this passage that the Tribunal's jurisdiction was limited to a review of the decisions referred to in the terms of the reference to it. The Tribunal had no jurisdiction or power to consider issues which were outside the terms of the reference. That is all, so far as is presently relevant, that can be gleaned from this passage. It does not support the proposition contended for by the applicant that in the judgment of the High Court the Tribunal''s (and therefore the Commission's) powers did not include any power to review an earlier determination that a condition was war-caused. O'Brien's case decided that the Tribunal's jurisdiction was derived from the referring instrument which did not include the earlier determination of the Repatriation Board which the Tribunal purported to review; hence the Tribunal had no power to entertain that issue." The Court has said already that it does not intend to consider the matters of estoppel raised by counsel for the applicant. Reference has been made earlier in these reasons to the nature of proceedings before the Tribunal when reviewing a decision of the Commission and that in truth the Tribunal is exercising the powers of the Commission. In these circumstances, it is difficult to understand how the Commission is a party before the Tribunal sufficient to found an estoppel. Different considerations may well arise on an appeal before this Court. There the Commission is a party with all the rights and obligations attached to a party. An estoppel may arise from proceedings in the Court. This can be illustrated by a reference to Blair v Curren (1939) 62 CLR 46 especially per Dixon J 532-3: "Nothing but what is legally indispensable to _ the conclusion is thus finally closed or precluded. In matters of fact the issue-estoppel is confined to those ultimate facts which form the ingredients in the cause of action, that is, the title to the right established. Where the conclusion is against the existence of a right or claim which in point of law depends upon a number of ingredients or ultimate facts the absence of any one of which would be enough to defeat the claim, the estoppel covers only the actual ground upon which the existence of the right was negatived. But in neither case is the estoppel confined to the final legal conclusion expressed in the judgment, decree or order. In the phraseology of Coleridge J in R v fInhabitants of the Township of Hartington Middle Quarter (1855) 4 E & B 780 at p794, the judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not' then directly the point at issue. Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous. In the phraseology of Lord Shaw, "a fact fundamental to the decision arrived at" in the former proceedings and "the legal quality of the fact" must be taken as finally and conclusively established (Hoystead v Commissioner of Taxation (1926) AC 155). But matters of law or fact which are subsidiary or collateral are not covered by the estoppel. findings, however deliberate and formal, which concern only evidentiary facts and not ultimate facts forming the very title to rights give rise to no preclusion. Decisions upon matters of law which amount to no mo;re than steps in a process of reasoning tending to establish or support the proposition upon which the rights depend do not estop the parties if the same matters of law arise in subsequent litigation." See also Effem Foods Pty Ltd v frawl Industries of Australia Pty Ltd (1993) 115 ALR 377 per Northrop and Lee at 380-381. In the present case the issue raised in Nation No 1 was based on the acceptance that the disease of bilateral maxillary sinusitis was a war caused disease. It may well be that that proposition cannot be challenged now since to do so asserts the decision in Nation No 1 of necessity is wrong. I do not decide this question, preferring to rely on the construction of the "matter" remitted to the Tribunal. Fa The appeal should be allowed on the first issue. The Court turns to consider the second issue relating to the application of section 120 of the Veterans' Entitlements Act in its application to the issue of whether the bilateral maxillary sinusitis was a war caused disease. This issue can be dealt with shortly. The Tribunal's decision was made after the High Court gave its judgment in Byrnes in which the methodology to be adopted in applying section 120 is clearly and simply expressed. Unfortunately, the Tribunal did not adopt that methodology even though it had been expressed in Bushell and Nation No 1. The Tribunal referred to the medical evidence given before it but it is not necessary to refer to that evidence except to say there was ample material before the Tribunal to raise a reasonable hypothesis connecting the applicants bilateral maxillary sinusitis with the circumstances of his service irrespective of whether reliance was placed on paragraph 9(1)(a) or 9(1)(b) of the Veterans' Entitlements Act. Each of these paragraphs have the benefit for the applicant of coming within the procedural provisions of subsection 120(3), see paragraphs 7(1)(a) and (b). In Nation No 1, I was in error in stating that paragraph 9(1)(b) did not come within subsection 120(3). The methodology to be adopted in cases of this kind is illustrated in Byrnes at 571-2. That methodology should be followed. It was not followed by the Tribunal. Instead of considering whether all or some of the facts raised by the material gave rise to a reasonable hypothesis connecting the applicants disease with war service, the Tribunal said: "Vidwing the relevant medical evidence as favourably to the applicant as I can, the most that can be said is that there is a possibility that his medical condition in December 1950 played some very minimal part in the development of sinusitis decades later." The Tribunal then referred to paragraphs 9(1)(a) and (b) of the Veterans Entitlements Act. It considered the meaning of the word "occurrence" in (a) and said: "In my view the medical condition the applicant sufferance from in December 1950 did not amount to an "occurrence". It was neither an event nor an incident nor a mishap. It is not susceptible of -differentiation from the course of events which constitute the ordinary course of life." This finding was made despite the fact that the applicant was in hospital for the five day period is established by army records. fhe Tribunal then considered paragraph 9(1)(b). It referred to Repatriation Commission v Law (1981) 147 CLR 653 and concluded: "However I take the view that the applicant's cold or rhinitis in December 1950 played a so minimal or part, if any, in the causation of his sinusitis as not to amount to a constituting factor at all. De minimis non curat lex." This, despite credible evidence to the contrary by the surgeon who performed the nasal operation in August 1982. The Tribunal then concluded: "Accordingly, after the consideration of the whole of the material before the Tribunal, I am of the opinion that that material does not raise a reasonable hypothesis connecting the applicant's bilateral maxillary sinusitis, nor any "disease" referred to in his claim in respect "of "anxiety neurosis", with the circumstances of the particular service rendered by him." Having reached this conclusion, the Tribunal did not consider the application of subsection 120(1) of the Veterans' Entitlements Act. What is clear is that in applying subsection 120(3), proof of facts is not in issue. The methodology adopted by the Tribunal led to error in applying subsection 120(3). As I said earlier, there was ample material of a credible nature to give rise to the requisite reasonable hypothesis. The Tribunal, because of this error, did not consider the application of subsection 120(1). The appeal must be allowed on the second issue. The question arises as to what orders should be made. The order made by the Tribunal must be set aside. On the basis of the findings on the first issue and the subsequent findings of the Tribunal on that issue, the applicant is entitled to the special rate of pension under section 24 of the Veterans' Entitlements Act. The order sought by counsel for the applicant is that the applicant's obsessive compulsive neurosis is a war-caused disease for the purposes of section 13 of the Veterans' Entitlements Act, but such an order leaves open the rate of pension to be paid. Normally the Court does not make substantive orders in appeals under the Administrative Appeals Tribunal Act. In the absence of the second issue, only one answer could be given, that contended for by counsel for the applicant. The Court has expressed the view that the second issue should not have been considered by the Tribunal. Accordingly, the order sought should be made. The court is fortified in doing this by the fact that the applicant has succeeded on the second issue. Further, regard should be had to the history of the application since it was made in February 1988. Almost seven years later, that application has not been finally determined. The Court makes the following orders: The appeal be allowed with costs. The decision appealed from be set aside and in lieu thereof it be declared that the applicant's obsessive compulsive neurosis is a war-caused disease for the purposes of section 13 of the Veterans' Entitlements Act 1986. Remit the matter to the Repatriation Commission to determine the rate of pension to be paid to the applicant and the date from which that pension is to be paid. I certify that this and the preceding nineteen (19) pages are a true copy of the Reasons for Judgment of The Honourable Mr Justice R.M. Noythro Associate: l Date: 7) Ly) \994 ATTACHMENT Solicitor for the Applicant: Vardanega Roberts Counsel for the Applicant: Mr Smith Solicitor for the Respondent: Australian Government Solicitor Counsel for the Respondent: Mr Green