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AN06 APPLICATION OF THE FULL FEDERAL COURT DECISION IN KEELEY
Advisory from Disability Compensation Branch
This is an advisory note only. Disability Compensation Branch and Legal Services Group have agreed this policy view. It is not a Repatriation Commission Guideline or a Departmental Instruction. The advice is not intended to conflict with the proper application of the Veterans' Entitlements Act 1986 or the judgement of the Full Federal Court in the matter of Repatriation Commission v Keeley. It may be subject to change as a result of further interpretation by the Courts of the legislation. Nevertheless it represents the considered views of both Branches and should be taken into account by all delegates of the Repatriation Commission.
APPLICATION OF THE FULL FEDERAL COURT DECISION IN KEELEY
At the moment the full implications of Keeley are not well understood. The Commission is yet to consider its options concerning the case itself. Nevertheless the Court's decision is binding.
Our advice is that at the AAT level we have to agree with any position put by the AAT that because of the Full Court's decision the SoP to be considered in all entitlement matters is the one in force at the time of the original decision.
This is in spite of perhaps a later SoP being more advantageous. If the other side wants to interpolate this into the Keeley decision then they will have to provide the justification for doing so.
This means, until such time as any other view is taken, that a concession at the AAT on the basis of a later SoP being more advantageous is not possible.
Naturally this would also apply to s31 reviews as well. To be specific a request for a review of a decision on the basis of a new SoP could not be met under the Keeley provisions.
It would seem that on the basis of Keeley a review on a later SoP is not possible.
In practice the only advice that we could provide to a person or representative is that to take advantage of a later more generous SoP a new application would have to be made and that cannot be done while a current application is under review. They must also be told that if they withdraw the appeal then the date of effect will be based on the new application.
I attach two documents to assist in your understanding of the current situation.
The first is an advice from the Policy and Legal areas of the Department to the Repatriation Commission that discusses the case and looks at the implications and possible responses.
The second is a paper by Bruce Topperwien provided to the VRB that comes to the same conclusion and that is that the VRB must apply the same SoP that the Commission used at the primary level.
John R Douglas
Policy, Eligibility and Research
Disability Compensation Branch
4 May 2000
Department of Veterans' Affairs
KEELEY – FULL FEDERAL COURT DECISION
To provide brief initial advice on the outcome of the Commission's appeal to the Full Court of the Federal Court in the Keeley matter.
2.In September 1986, the late Mr Keeley died from multiple myeloma. He had World War 2 service in the RAAF, including service in the South-West Pacific and hence he had operational service. His widow lodged a claim for war widow's pension on 14 December 1994 and thus the claim had to be determined under the RMA SOP regime. The basis for Mrs Keeley's claim was the veteran's occupational exposure to paints and/or lacquers while on service. At the time of the Commission delegate's decision, SOP No1 of 1995 was in force and the delegate decided against the claim. The delegate's decision was upheld by the VRB whereupon Mrs Keeley applied for review by the AAT. Before the claim came before the AAT, SOP No 134 of 1996 was made, which more closely defined the levels of exposure required than had the earlier SOP.
3.The AAT (per Senior Member Webster) concluded that it should apply the SOP in force at the time of its decision and refused the claim. Mrs Keeley appealed to the Federal Court, which in a decision by Heerey J, found that there was an accrued right to have the claim decided on the SOP in force at the time of the primary decision. The Full Court (Lee, Cooper and Kiefel JJ) has now upheld this position.
Difficulties arising from the Federal Court's decisions
4.In brief, the requirement that decision-makers in the review chain (ie. the VRB and the AAT) confine consideration of the matters before them to the SOP position at the time of the primary decision precludes the application of later SOPs. Since later SOPs embody the latest medical and scientific research then available on the condition in question, it is clearly anomalous that this material cannot be used in deciding the claim. Indeed, such an approach could work to the disadvantage of many claimants since, as Heerey J's decision indicates and on which point the Full Court is silent, the accrued right is to have the claim decided on the SOP in place at the time of the primary decision. Thus, in relation to the claim on foot, the veteran cannot take advantage of any later more beneficial SOP eg. several smoking-related SOPs where the quantity of cigarettes smoked has been reduced as has the length of time from smoking cessation to clinical onset of the disease. Of course, this problem can be overcome by a new claim but this may involve a loss of backpayment.
5.The Court's approach runs contrary to whole thrust of the SOP/RMA/SMRC legislative package, which was designed to have claims considered on the most up-to-date medical-scientific evidence. Similarly, it runs contrary to the normal VRB and AAT decision-making approach which provides for the de novo hearing of matters before those bodies based on the latest evidence available to the point of VRB or AAT consideration. Moreover, the Court's approach reverses the situation that pertained under the VEA as it stood before the SOP regime and as it stands now where there is no SOP covering a condition ie. in the latter situation and pre-SOPs, claims are decided directly under the ss120(1) and (3) (and ss120(4) where applicable) with the most up-to-date evidence being considered by the VRB and AAT.
6.Further, the Full Court's decision in Ogston means that there will be circumstances where delegates will have to act on the latest medical-scientific evidence, namely where a formal RMA investigation is underway per ss120A(2). Thus, with Keeley we now have conflicting lines of authority on the point.
7.Also, the Court's discussion of the occurrence provision of VEA paragraph 8(1)(a) suggests that in some instances a claimant could avoid the application of the SOP altogether. It is to be expected that some claimants will seek to rely on the Court's comment in this area to by-pass the SOP regime. This was never intended.
8.While it is nice to see the judge at first instance expressing concern about the preferability for the Commission's “orderly management, planning and budgeting” (Heerey J at para 40) “that potential liability for claims be ascertainable as early as possible”, it is clear he has no comprehension of the administrative chaos that can flow from his decision, a decision now confirmed by the Full Court. Arguments will surely now be made that a veteran can choose which of the SOPs is more beneficial to his claim, and even arguments allowing he/she to pick and choose between factors spanning different SOPs will be put. With claims on the same condition lodged at different times, it is very possible that different decisions can be given on the same condition on the same date since the claims may be governed by different SOPs. Where the claim relies on a sequence of SOPs the difficulty is exacerbated. Clearly also, the Commission will not wish to see veterans denied the benefit of later SOPs but on the law as it now stands this is not possible in relation to an ongoing claim.
9.As a matter of urgency, an opinion from Counsel has been sought on this decision. Commission will be advised as soon as the opinion is received. It is expected that reference will be made in the course of that opinion to a wider Government interest in having the High Court reconsider its decision in Esber's case (for further discussion separately).
Where to from here?
10.Subject to that opinion and Commission deliberations, it may be appropriate as a protective measure to lodge an application in the High Court for Special Leave to appeal the Keeley decision. In parallel, consideration should be given to an urgent legislative amendment to resolve this issue once and for all.
11.To maintain our options, the Merits Review Committee has agreed, subject to contrary instructions, to prepare for the lodgement in the High Court of an application for Special Leave to appeal.
12.In respect of legislative amendment, there is a window of opportunity to effect such amendment through a non-Budget bill that has priority on the legislation programme for the next sittings of Parliament. Drafting instructions must be lodged with the Office of Parliamentary Counsel by 12 May 2000. The addition of these amendments will require the Prime Minister's approval and the agreement of the Parliamentary Business Committee. Commission approval is sought now to commence work on this approach.
4 May 2000
Veterans' Review Board
Repatriation Commission v Keeley  FCA 532
Lee and Cooper JJ wrote a joint judgment. Kiefel J wrote a separate judgment, concurring in the result. The disagreement between the two judgments appears to be the nature of the accrued right as discussed in Esber's case (1992) 174 CLR 430.
Lee and Cooper JJ
Standard of proof
The joint judgment begins with a general discussion about the applicability of Statements of Principles and the standard of proof. It makes the observation that even though a SoP upholds a reasonable hypothesis, it might be disproved beyond reasonable doubt (para 13). (This point is also made in Discussion paper No. 8.)
Non-applicability of SoPs in some circumstances
There is some discussion of the applicability of SoPs to questions arising under s 8(1)(a), suggesting that in some circumstances, SoPs might not be applicable and need not be applied because of the temporal rather than causal connection required by that provision especially if no medical issue is involved. Lee and Cooper JJ made no reference to the fact that the terms of s 8(1)(a) are repeated in s 196B(14), which the RMA must consider in making a SoP and which are included in the phrase “related to service” both in s 196B and in the SoPs. This discussion is clearly obiter as it has nothing to do with the circumstances of Keeley's case. Lee and Cooper JJ recognised that the only issue before the Court was 'whether the Tribunal erred in failing to apply the revoked Statement' (para 32).
The accrued right
Lee and Cooper JJ, citing Esber, noted that 'a right to have a decision reconsidered and determined by the Tribunal was not merely a power to take advantage of an enactment nor a mere matter of procedure; it was a substantive right that may be said to have accrued under that enactment.' (para 38) They indicated that the right that accrued upon the lodgment of a claim, to have the claim determined under the Act by the Commission, was 'affected' by the making of a SoP. (para 42)
They held that s120A(2) shows a clear intention to affect an accrued right (para 44), but that circumstance does not apply after a claim has been determined (para 45). The right that has then accrued is the right to have the determination reviewed. There is no provision equivalent to s 120A(2) in relation to the investigation of the RMA when reviewing a SoP (para 45).
Lee and Cooper JJ then concluded by saying:
'Unless a contrary intention is clearly disclosed, it is to be presumed that accrued rights are determined under the law as it stood when the right accrued. With regard to beneficial legislation such as the Act, it may be assumed that a construction of substantive provisions least likely to work or cause unfairness in result is to be preferred. It may be concluded that Parliament intended that the review of a decision on a claim made pursuant to a Statement more beneficial to a claimant than the terms of a Statement that replaced the former Statement after the decision had been made, is to be conducted as if the former Statement had not been revoked. Unless the Act provided otherwise, a proceeding initiated under the Act to review a decision made by the Commission was to be carried out by determining if the respondent's claim to a pension had been wrongly refused, the decision of the Commission to be replaced by the decision that should have been made by the Commission had it properly applied the law as it stood. (See Esber per Mason CJ, Deane, Toohey, Gaudron JJ at 440-441.)'
Kiefel J said that 'the first enquiry in any case must be as to whether a right had accrued prior to the repeal or amendment.. ... A right may vest in or be held by a person prior to the repeal or amendment in question by the application of the law then in existence to the facts as they had already occurred. The law will then have 'defined' the right, as Dixon CJ said in Maxwell v Murphy.' (para 67).
Kiefel J then quoted Dixon CJ again, this time in Kraljevich v Lake View and Star Ltd (1945) 70 CLR 647 at 652, in which he said: 'liabilities that are fixed, or rights that have been obtained, by the operation of the law upon the facts or events for, or perhaps it should be said against, which the existing law provided are not to be disturbed by a general law governing future rights and liabilities unless the law so intends'. (para 67)
Kiefel J held that, 'Statements of Principles operate generally as a bar or threshold test. The bar or limitation operates on the right to a pension itself because the Statements of Principles determine the connexion between death and service as a minimum, in each case. ... The introduction of the second SoP affected the right to pension under s 13, as had the first.' (para 76)
At para 78, Kiefel said, 'The repeal of the first SoP affected the content of Mrs Keeley's right. It follows, in my view, that s 50 AIA operates, subject to the further question whether any intention to the contrary is discovered by the second SoPs as the repealing provision.'
Kiefel J agreed with Heerey J that 'the need for consistency of decisions of lay tribunals is ... met by applying the SoP existing at the time of the primary decision.' (para 81)
So what does this mean for the VRB?
Kiefel and Heerey JJ both clearly state that the law as at the date of the Repatriation Commission's decision must be applied.
Lee and Cooper JJ appear to agree, but not so clearly. They say that the accrued right is to have the decision reviewed and determined by the law that applied at the time of the Commission's decision, and the right that the claimant had at the time of the Commission's decision was 'the right to have the claim determined' (para 42). That right was affected by the making of a new SoP, but section 50 AIA prevents that right been overridden by the new SoP. If the right is to have the claim determined on the law when that right accrued, then it cannot permit a view that there is also a right to have a later SoP applied. The only right that has accrued to the claimant is the right to have the claim determined on the previous law.
Kiefel J differs from Lee and Cooper JJ in that she says that the relevant right would be a right to a pension rather than a right to have the claim determined upon review (para 79). However, she recognises that the facts have not been found by the AAT to decide whether Mrs Keeley would actually succeed under the first SoP (para 62), and said that 'I have not found it necessary, in applying s 50 AIA, to consider the nature of Mrs Keeley's rights to review as “rights” which had 'accrued' for the purposes of that provision' (para 79). Nevertheless, on the important question of what SoP applies, she comes down on the side that says it is always the SoP at the time of the Commission's decision (unless a contrary intention appears in the Act, and she did not find one).
If this is the proper analysis of these judgments, then the VRB is bound to apply the SoP that was in force at the time of the Commission's decision.
28 April 2000