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McKenzie v Repatriation Commission

[2014] FCA 777

COURT Federal Court, Melbourne
JUDGE Murphy J
DATE OF DECISION 25 July 2014
DECISION The appeal was allowed
ISSUES Whether Tribunal erred in finding there is no material to show a reasonable hypothesis

Facts

The applicant, Mrs McKenzie, applied for a war widow’s pension. The essence of her claim was that due to peer group pressure, stress and boredom of his operational service in the Philippines, Mr McKenzie commenced to smoke 10-15 cigarettes per day and continued to do so until 1952. The applicant claims that Mr McKenzie’s smoking habit caused him to suffer oesophageal cancer. Mr McKenzie died as a result of cardiomyopathy contributed to by treatment for oesophageal cancer.
The Repatriation Commission refused her application on 20 November 2009 and Mrs McKenzie appealed to the Administrative Appeals Tribunal which also rejected her claim.

The applicant then appealed to the Federal Court.

The Federal Court considered that in dealing with Mrs McKenzie’s claim the Tribunal failed to correctly apply s120(3) of the Act, as affected by 120A, and did not properly follow the decision-making process described by the Full Court in Deledio.

Grounds of Appeal

The notice of appeal alleged two questions of law:

  1. Whether there was any material before the Tribunal which pointed to a hypothesis connected with the veteran’s war service that the malignant neoplasm of the oesophagus which contributed to his death had been caused by his having smoked at least five pack years of cigarettes during a period which commenced at least five years before the clinical onset of the disease.
  2. Whether it was open on the material before the Tribunal for it to have concluded that there was no material pointing to the hypothesis.

The Court’s Consideration

The Court noted the Tribunal was required to form an opinion as to whether the evidence before it pointed to the existence of the required criteria in SoP No. 41. If it did then the SoP would uphold the asserted hypothesis and it would be a reasonable one. The real question was whether in making a factual assessment in order to form an opinion the Tribunal crossed the dividing line and descended into impermissible fact finding.

The Court considered at [54]:

The Tribunal’s task at this stage of the s120(3) inquiry was to form an opinion as to whether SoP No.41 upheld the asserted hypothesis. The authorities show that it would do so if the evidence before it pointed to Mr McKenzie having smoked the required minimum quantity of cigarettes or other tobacco products. But instead of looking at what facts were pointed to or raised by the evidence the Tribunal engaged in a process of weighing the evidence, preferring some parts of it to others parts, and ultimately rejecting some of it. It also used the discourse of fact finding. I consider the Tribunal misunderstood its task under s120(3) and asked itself the wrong question. It did not follow step 3 of the Deledio process.

The Court considered the Tribunal descended into impermissible fact finding when it concluded there was no material pointing to Mr McKenzie’s consumption of cigarettes in light of all the evidence.
The Tribunal was obliged to consider all of the evidence before it, not just some of it. The Court noted the Tribunal was not permitted at step 3 of the Deledio process to reject some of the evidence or to engage in fact finding.

However, the Court noted the Tribunal’s conclusion that there was no material pointing to Mr McKenzie having consumed the required minimum quantity of cigarettes and other tobacco products must be seen as a rejection of Mrs McKenzie’s evidence, that he expressly told her that he smoked 10-15 cigarettes per day. The Tribunal’s conclusion that Mrs McKenzie did not know how many cigarettes Mr McKenzie smoked and that her evidence as to his cigarette consumption was speculation was also be seen as a rejection of that evidence.

The Court considered these conclusions indicated that the Tribunal evaluated and selectively dealt with the material before it, and that it was finding facts rather than simply identifying the raised facts.

The Court also noted that in finding there was “no material” the Tribunal used the language of fact finding.

In the Court’s view:

  1. Mrs McKenzie’s evidence that Mr McKenzie told her that he smoked 10-15 cigarettes per day which commenced while he was on operational service and continued until 1952;
  2. Janene McKenzie’s evidence that Mr McKenzie told her that he was a “keen smoker”, and that he smoked anything that he could get his hands on, that on return from service he smoked at work to the point that it was inconvenient, and that he smoked “a lot”; and
  3. the evidence in Mr McKenzie’s letters home of his consumption of cigarettes and other tobacco products while on service;

clearly pointed to or raised that Mr McKenzie consumed five pack years of cigarettes which is the minimum provided by SoP No. 41.

In the Court’s  view the Tribunal’s decision that the material before it did not point to that conclusion was made on the facts as found by it and not on the facts as raised by the evidence.

The Court's Decision

The appeal was allowed. The Court was satisfied the Tribunal erred in its application of s120(3) as affected by s120A, and engaged in impermissible fact finding at step 3 of the Deledio process.

Editorial note

This appeal concerned the application of s120(3) of the Act in reference to the decision making exercise set out by the Full Court in Deledio.

Murphy J noted that apart from the one qualification, the four step process in Deledio has been consistently endorsed and applied in numerous single judge and appellate decisions. The qualification being – that the second sentence in the second paragraph of Deledio being “ If no SoP is in force, the hypothesis will be taken not to be reasonable and, in consequence, the application must fail,”, is not correct and was noted by the Full Court in Woodward v Repatriation Commission.[2003] FCAFC 160.

Murphy J also noted that the case of  East v Repatriation Commission[1987] FCA 242 stands for the wellaccepted proposition that the relevant element of an asserted hypothesis must be “pointed to” or “raised” by the evidence, and not merely left open. East also does not require, at that stage of the inquiry, that each factual element of the hypothesis be proved by making findings on conflicting evidence or that precise evidence be adduced to finally make out each element.

Please refer to the recent Federal Court case of Forrester v Repatriation Commission.[2013] FCA 898, for further guidance on the decision making process as set out in Deledio. The practice note is in VeRBosity Volume 28 at page 55.

Further decision - 16 September 2014
In the Court’s reasons for judgment on 25 July 2014, the Court set out its preliminary view that if the matter is remitted to the Tribunal for rehearing only one result is reasonably open, and that the Court should make a factual finding under s44(7) of the Administrative Appeals Tribunal Act 1975 (AAT Act). The Court directed the parties to provide further submissions as to relief.

Following the parties’ submissions, the Court considered it should make a factual finding under s44(7). The Court noted at [16]:

The power to make factual findings is only to be exercised in the limited circumstances described in s 44(7), but these circumstances do not include any requirement to have the same evidence before the Court as was before the Tribunal. It does though include a requirement that the evidence be sufficient to make the finding.

The Court considered it was likely that all available evidence of significance regarding the extent of Mr McKenzie’s cigarette and tobacco consumption was before it, due to the Tribunal’s detailed summary of evidence, and because - given the opportunity to identify the evidence that was not before the Court - the Commission did not identify any evidence of significance.

The Court went on to justify why it was appropriate to make a factual finding:

  1. the evidence has been fully traversed by the Tribunal and there is little dispute between the parties as to the primary facts. The dispute really goes to the conclusions to be drawn from those primary facts.
  2. having regard to subs 44(7)(b)(i), a factual finding is necessary as the Court’s earlier conclusions were expressed in identifying the Tribunal’s error of law.
  3. having regard to subs 44(7)(b)(ii), the facts underpinning the finding are clear.
  4. having regard to subs 44(7)(b)(iii), (iv) and (v) there can be no question that the expeditious and efficient resolution of the whole of the matter will be best achieved if the Court makes the necessary findings of fact.
  5. having regard to subs 44(7)(b)(vi), the applicant seeks that the Court should make the necessary finding.

Therefore, the Court concluded at [38]:

Although it really involves mixed questions of fact and law, to the extent that step 3 of the Deledio process involves a factual assessment it is appropriate to find, pursuant to s 44(7), that the hypothesis asserted by Mrs McKenzie fits within the template of SoP No 41. It is common ground that the asserted hypothesis fits within the template of SoP No 23 and it therefore fits within both applicable SoPs. Step 3 of the Deledio process is to be decided in favour of Mrs McKenzie.

Both parties accepted that step 4 of the Deledio process must be decided in favour of Mrs McKenzie, given the Tribunal held at [63] of its decision that, had the asserted hypothesis fitted within the applicable SoPs, it would not have been satisfied beyond reasonable doubt that Mr McKenzie’s death was not war-caused.

Therefore Mrs McKenzie was eligible for a war-widow’s pension.

All Practice Notes