Scott & Anor v Secretary, Department of Social Security M112/2000 [2001] HCATrans 358 (10 August 2001)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M112 of 2000

B e t w e e n -

RALPH SCOTT

First Applicant

SOPHIE SCOTT

Second Applicant

and

SECRETARY, DEPARTMENT OF SOCIAL SECURITY

Respondent

Application for special leave to appeal

KIRBY J

CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 10 AUGUST 2001, AT 2.02 PM

Copyright in the High Court of Australia

MR R.A. SCOTT and MRS S. SCOTT appeared in person.

MR R.R.S. TRACEY, QC: If the Court pleases, I appear with my learned friend, MR P.J. GINNANE, for the respondent. (instructed by the Australian Government Solicitor)

KIRBY J: Yes, Mrs Scott.

MRS SCOTT: May it please the Court, the applicants asked the Court below to judicially review, inter alia, the wrongful rejection of a disability support pension in 1993 and the consequential torts. Arguments and evidence were presented below, the evidence of this is in the application book, pages 29 to 32, notice of appeal to the Full Court of the Federal Court, ground No 4 at page 25 and the supplementary documents, pages 48 to 51.

The payability of a disability support pension to the second applicant was tested by the respondent in 1993. It was not open to the respondent to reject that disability support pension claim in 1993. The reasons: (a) The respondent had two kinds of medical decisions. The first kind were the professional medical opinions confirming the permanent and significant physical impairment of the second applicant and confirming her permanent inability to work. The second kind were the impossibility to reject the second applicant's impairment, lack of medical diagnoses and the not signed document. The impossibility to reject is never equal to rejection of impairment.

The first mandatory step in assessing the impairment in accordance with section 94 of the Social Security Act and Schedule 1B of the Social Security Act is to make the medical diagnoses. A document that is not signed does not constitute the assessment of the impairment because it is not made in accordance with the form approved by the respondent. This is the respondent's regular practice of interpreting section 116(5) of the Act. This interpretation is stated in the Re Wiebenga Case. The applicants also rely on the GCHQ Case and Kioa v West in regard to fairness. Therefore, the rejection of the disability support pension claim in 1993 offended the "no evidence" rule and was unfair.

(b) Assessment of impairment may be made only by a medical officer, only after a medical examination, and must deal with the impairment of function and not only with pain. These requirements are in Schedule 1B of the Act. Officers Peak, Williams and Chrystal assessed the impairment of the second applicant as being zero per cent, assessed pain only and disregarded the impairment of function. They were and are not medical officers and have never medically examined the second applicant.

The refusal to acknowledge the existence of the pulmonaro-cardio-vascular impairment of the second applicant by the respondent could have foreseeably led to death by the rupture of the aorta or by the burst of the brain artery. The refusal to acknowledge the existence of the musculo-skeletal impairment could have foreseeably led to the injury. The respondent knew since 1993 about the preparation of the appeal to the Social Security Appeals Tribunal, that involves the financial loss. Therefore, the rejection of the disability support pension claim in 1993 was ultra vires the Act, was unreasonable, with the foreseeable risk of harm. The rejection of the known impairment by the officials of the Department of Social Security is always directed against the claimant.

Point 2. It was not open and tortious to maintain by the respondent the rejection of the 1993 disability support pension claim until the end of 1996 and therefore it was tortious to starve the applicants in 1995. The reasons: (a) Section 113 of the Act imposes on the respondent the public law duty to decide a disability support pension claim only in accordance with the Act. A statement to the same effect was made by the Honourable Justice Finkelstein at page 49 of the application book, lines 21 to 23. The rejection of the disability support pension in 1993 offended section 94 and Schedule 1B of the Act and therefore was in breach of that duty. The applicable principle is in Pyrenees Shire Council v Day.

(b) Medical misdiagnosis of the officers of the respondent created danger of death made in the exercise of officers' functions under the Act. The applicable principle is Sutherland Shire Council v Heyman. (c) There is an assumption of responsibility, control and the non-delegable duty on the respondent and the vulnerability of the applicants. The applicable principle is Northern Sandblasting Pty Ltd v Harris. (d) There exists the duty to review the rejection of the 1993 disability support pension claim, that duty is consistent with the existence of internal reviews under section 1239 of the Act, plus the beneficial nature of the Act, plus the Julius principle.

In 1995 and 1996 the respondent and the Social Security Appeals Tribunal rejected the medical opinions of professors of medicine, of specialists in orthopaedics and pulmonology, of consultants, who medically examined the second applicant and the Social Security Appeals Tribunal and the respondent rejected the undeniable data on X-rays and on MRI films. The respondent insisted below and insists now before the High Court that the "no evidence" principle and Schedule 1B of the Act not be considered. I refer to pages 86 and 87 of the application book, the respondent's summary, paragraphs 1(w) and 1(x). That insistence caused the miscarriage of justice.

Point 3. This point is applicable regardless whether the respondent had or did not have information about the payability of pensions and benefits to the second applicant in 1995. Officer Pedler knew not later than on 19 July 1995 that the second applicant claimed a special benefit because the 1993 disability support pension claim had been unreasonably rejected and the appeal was being prepared to the Social Security Appeals Tribunal. In July and August 1995 the applicants were continuously requesting that officers give time for the preparation of evidence to the Social Security Appeals Tribunal or to the respondent.

The refusal of special benefits was unreasonable, improper, perverse, caused foreseeable harm, and was directed against the second applicant. Reasons: time to prepare the evidence and case should have been given under the fundamental rule of procedural fairness stated in Polemis. (b) Administrators must act fairly. The principle is Ridge v Baldwin. This principle is also in section 1296(a)(iii) of the Social Security Act. The powerful and mighty respondent was trying to obtain medical opinion of no impairment of the second applicant for one year. Fairness required to grant two months of special benefits to the second applicant, when about one and a half years were needed to secure the appeal and evidence to the Social Security Appeals Tribunal by the disabled applicants.

Fairness was especially important because officers knew of the existence of the highly specialistic medical opinions and that some more time was needed. Next, officers already unfairly rejected the existing medical opinions; the intention of the Australian Government Health Service doctors was to exclude any medical problems of the second applicant; and the exclusion of the medical problems of the second applicant could have led to death or to serious injury to the second applicant.

(c) Statute does not abrogate the common law rights unless there exists a clear intention to do so. There is no intention in the Social Security Act that would prevent the second applicant from preparing the appeal to the Social Security Appeals Tribunal. The appropriate principle is in American Dairy Queen v Blue Rio. It is the unanimous decision of the High Court. (d) Courts below were informed of the admission of officer Chrystal that the rejection of the special benefits when the second applicant claimed it to prepare the appeal to the Social Security Appeals Tribunal was inappropriate and detrimental.

(e) There was the continuous repetition of the request by the second applicant for time and for livelihood in July and August 1995. (f) The refusal of time to prepare the evidence interfered with the objective of identifying the payability of a disability support pension to the second applicant. That should have been the objective, not only of the applicants, but also of the respondent. However, the objective of the respondent was to prevent the addition of evidence supporting the grant of a disability support pension to the second applicant.

(g) It is reasonably foreseeable that the denial of procedural fairness and that denial of any livelihood causes harm. Arguments on these points were made below. Evidence of that is in the application book at page 41, lines 24 to 27, notice of appeal to the Full Court of the Federal Court ground 1(c) at page 24 to 25 and arguments in the Full Court of the Federal Court, pages 29 to 32. The breach of duty to act fairly was expressly stated by the applicants in the statement of claim. The evidence of this is in the application book page 21, lines 5 to 8, plus page 11, line 37. This connects the first applicant with the second applicant. Their Honours below erred in law in dismissing the applicants' case.

Point 4. It was not open to officers Pedler and Williams to dispose of the claim for special benefits on the ground that claims for job search allowance, sickness benefit and the second disability support claim were not made and that, allegedly, no decision regarding the payability of pensions and benefits could have been made. That disposition was without any consideration of the existing evidence, without consideration of the merits, and against the existing practice under the Hagedorn principle, Peko-Wallsend and Shaddock principles.

The officers were or should have been aware from the departmental files and under the Peko-Wallsend or Shaddock principles of the following special circumstances of the second applicant: (a) The second applicant was entitled to a disability support pension from 1993 but that disability support pension claim was wrongly refused by the respondent. (b) The second applicant was not entitled to a job search allowance and a sickness benefit and must not claim this payment because of the breach of the Social Security Act committed by the second applicant.

(c) The second applicant could not appeal to the Social Security Appeals Tribunal or claim a disability support pension again in July or August 1995 because of her unpreparedness. (d) The second applicant requested time. Officer Pedler did not see the departmental files about the payability of a disability support pension to the second applicant. It was despite the second applicant's encouragement to do so stated in the special benefits claim in the grounds for claiming. The Hagedorn principle forces the respondent to become familiar with the departmental files and requires that the respondent determine the payability of pensions and benefits under section 729 of the Social Security Act without claims for these pensions and benefits.

Their Honours' decision is consistent with the Peko-Wallsend, Shaddock and Hagedorn principles. Their Honours distinguished the position of the respondent only if the respondent had not had sufficient information about the payability of pensions/benefits to the second applicant. We refer to the decision of Justices Beaumont and French at page 46, lines 5 to 12, and the Honourable Justice Finkelstein at page 48, lines 20 to 25. The error lies in the extraordinary persuasion of the respondent that, against the evidence, the files about the second applicant allegedly were without information.

Point 5. Decisions of particular officers: (a) Officer Pedler knew the Hagedorn principle, knew that she must not disregard the grounds for claiming special benefits stated by the second applicant. These grounds encouraged her to check the departmental files and to reconsider the rejection of the disability support pension in 1993. Officer Pedler did not check the files and refused to determine the payability of special benefits under section 729 of the Act on the knowingly invalid ground of the necessity for claims. It was foreseeable that that refusal and the consequential starvation were harmful.

Officer Chrystal knew that she must not make medical opinions; knew that she had medical opinions confirming the significant physical impairment of the second applicant; and knew that she did not have any medical opinion rejecting that impairment. We now refer to the supplementary document page 48. Officer Chrystal, knowingly acting in excess of power, assessed the impairment of the second applicant as being zero per cent. (c) Officer Chrystal knew on 10 August 1995 that a person preparing an appeal to the Social Security Appeals Tribunal was entitled to special benefits; knew on 10 August 1995 that the second applicant was preparing the appeal to the Social Security Appeals Tribunal; knew - - -

KIRBY J: You realise that you have three more minutes? The warning light has come on.

MRS SCOTT: - - - knew that applicants suffered harm without special benefits. Officer Chrystal, knowingly acting in excess of power, delayed the grant of special benefits to the second applicant until 23/24 August 1995. Officers of the respondent generally reject medical evidence and make dangerous medical misdiagnoses, supplementary document page 48.

The officers of respondent did so in the case of the second applicant and starved the applicants who dared to challenge the dangerous medical misdiagnoses. The actions of the officers of the respondent affect, because of the general applicability of the Social Security Act and of the legal principles involved, the whole Australian society. The officers of the respondent committed towards the applicants the criminal act of serious oppression by starving the applicants for two months.

Point 6. Statutory power must be exercised in a fair and not injurious way. Applicants support similar argument of his Honour Justice Finkelstein who stated that at page 48 of the application book, lines 28 to 30, with the wording of section 1296(a)(iii) of the Social Security Act.

Facts. Applicants had no decision about the special benefits claim for one month. No livelihood was granted by the respondent to the second applicant for two months; two months without any livelihood kills a -person. The Social Security Act does not permit to kill people. Any livelihood was continuously being denied to the second applicant, despite her appeal to the Social Security Appeals Tribunal at the beginning of August 1995 to speed up the decisions of officers of the respondent about the special benefits claim.

Whether officer of the respondent were not efficient in the exercise of their duties or whether not enough of them were employed by the respondent, it does not alter the fact that these officers were not empowered to starve the applicants for two months. Therefore, the duty of care was breached. There exists a difference of opinion in the court below as to the extent of the duty of care.

Point 7. The court below did not consider the cause of action of trespass. Point 8. No livelihood was granted to the second applicant between 30 June and 1 September 1995, evidence is in the supplementary document pages 52 to 55.

KIRBY J: Your time is up, Mrs Scott. We have read all the documents and we are aware of the issues.

MRS SCOTT: Your Honour, may I have two more minutes?

KIRBY J: You may have one more minute.

MRS SCOTT: Thank you. The applicants are submitting that the High Court directs the court below to correct its decision and that the court below should consider not part, but the whole matter that the court was asked to consider. In the alternative, the applicants are submitting that the High Court itself decides the existence of the causes of action.

The grounds in the notice of appeal to the High Court are result based and not reason based. However, we notice that some lawyers prepare the grounds which are the reason based. If the High Court requires the reason based grounds of appeal, we are asking for leave to add the ground to the effect that their Honours below did not consider the whole matter that they were asked to consider and that caused the miscarriage of justice.

KIRBY J: Yes, I think your time has now expired.

MRS SCOTT: If your Honours have no questions, that concludes the submissions.

KIRBY J: Thank you very much. The record will show that Mr Scott stood by with Mrs Scott in the course of making those submissions to the Court. Mr Tracey, the Court does not need your assistance.

The facts and issues in this application are set out in the judgments of Justice Heerey in the Federal Court of Australia and of the Full Court of the Federal Court and in the submissions, both written and oral, of the parties. Even if, as Justice Finkelstein in the Full Court concluded, the respondent owed the applicants a duty of care as they allege, no breach of any such duty was established in this case. The Full Court of the Federal Court was correct to so hold. No other foundation is established to warrant a grant of special leave to appeal and special leave must therefore be refused.

Do you seek costs? I think that, in your written submissions at page 88, you do seek costs.

MR TRACEY: Yes, I am instructed that we do.

KIRBY J: In accordance with the ordinary rule of this Court, special leave must be refused and the applicants must pay the respondent's costs.

AT 2.26 PM THE MATTER WAS CONCLUDED