COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Whitlam J.(1)

CWDS
  Veterans Affairs - qualification for widows' pension - connection with war
service - evidentiary onus - reasonable hypothesis - conflict of medical
opinion - fact finding - satisfaction beyond reasonable doubt - construction
of Veterans' Entitlements Act 1986, s 120 (1),(3).
  Veterans' Entitlement Act 1986 s 120(1),(3)
  Bushell v Repatriation Commission (1992) 66 ALJR 753

HRNG
SYDNEY, 1 March 1993
#DATE 23:3:1993
  Counsel for the applicant:        M.B. Smith
  Instructed by:                    Vardanega Roberts
  Counsel for the respondent:       Alan Robertson
  Instructed by:                    Australian Government Solicitor

ORDER
  1.   The decision of the Administrative Appeals Tribunal dated 3
       June 1992 is set aside.
  2.   The case is remitted to be heard and decided again by the
       Administrative Appeals Tribunal.
  3.   The respondent is to pay the applicant's costs.

JUDGE1
WHITLAM J.  This is an appeal from a decision of the Administrative Appeals
Tribunal ("the Tribunal").  The applicant is the widow of the late Harry
Nicholson ("the veteran"), who died on 3 January 1989.
2.  The applicant had claimed a pension under Part II of the Veterans'
Entitlements Act 1986 ("the Act") in respect of the death of the veteran.  The
respondent determined that the applicant was not entitled to such a pension.
That decision was affirmed upon review by the Veterans' Review Board, and the
applicant applied to the Tribunal for review of the Board's decision.   The
veteran had suffered from asthma for many years prior to his death.  Before
the Tribunal it was common ground between the parties that the veteran's
asthma related to and was caused by his "operational service" within the
meaning of the Act.  This meant, in effect, that the Tribunal's inquiry was
concerned with the causal connection between the veteran's asthma and his
death.
3.  The manner of determining the applicant's claim is laid down by s.120 of
the Act, which provides (so far as relevant) as follows:
     "(1)  Where a claim under Part II for a pension
     in respect of... the death of a veteran, relates
     to the operational service rendered by the
     veteran, the Commission shall determine that ...
     the death of the veteran was war-caused, ...
     unless it is satisfied, beyond reasonable doubt,
     that there is no sufficient ground for making
     that determination.
                           ...
     (3)    In applying subsection (1) or (2) ... in
     respect of the death of a person, related to
     service rendered by the person, the Commission
     shall be satisfied, beyond reasonable doubt,
     that there is no sufficient ground for
     determining:
                           ...
     (c)   that the death was war-caused ...;
     ... if the Commission, after consideration of
     the whole of the material before it, is of the
     opinion that the material before it does not
     raise a reasonable hypothesis connecting the ...
     death with the circumstances of the particular
     service rendered by the person.
     (4)   Except in making a determination to which
     subsection (1) or (2) applies, the Commission
     shall, in making any determination or decision
     in respect of a matter arising under this Act or
     the regulations, ... decide the matter to its
     reasonable satisfaction.
     (5)   Nothing in the provisions of this section,
     or in any other provision of this Act, shall
     entitle the Commission to presume that:
                           ...
     (c)   the death of a person is war-caused
           ...; or
     (d)   a claimant or applicant is entitled
           to be granted a pension, allowance
           or other benefit under this Act.
     (6)   Nothing in the provisions of this section,
     or in any other provision of this Act, shall be
     taken to impose on:
     (a)   a claimant or applicant for a
           pension or increased pension, or for
           an allowance or other benefit, under
           this Act; or
     (b)   the Commonwealth, the Department or
           any other person in relation to such
           a claim or application;
     any onus of proving any matter that is, or might
     be, relevant to the determination of the claim
     or application."
4.  In this case the veteran suffered a heart attack and was admitted to
hospital where he died 4 days later.  A resident doctor of the hospital signed
a death certificate stating, in Part I, that the cause of death was
cardiorespiratory arrest due to acute myocardial infarction and, in Part II,
that asthma was another significant condition contributing to death, but not
related to the disease or condition causing it.
5.  At the hearing before the Tribunal the applicant relied upon the evidence
of Dr Geoffrey Miller, a consultant physician, which included the following
statements in a report:
      (1)  "I consider that there is a reasonable
           hypothesis that Mr Nicholson, who certainly had
           severe asthma over the years before his fatal
           illness, suffered a pre-existing right
           ventricular impairment relating to his chronic
           incapacitating lung disease at the time of his
           admission to Manly Hospital."
      (2)  "In view of the severity of Mr Nicholson's
           asthma, and the association between stress and
           the precipitation of his asthmatic attacks, I
           consider it is a reasonable hypothesis to state
           that the respiratory arrest could have been
           precipitated by severe bronchospasm due to his
           asthma."
      (3)  "... I consider it a reasonable hypothesis to
           state that the long term steroids could have
           caused a degree of andreno-cortical suppression
           which would have interfered with his capacity to
           cope with the cardiac disturbance from which he suffered."
Dr Miller concluded that report as follows:
           "SUMMARY
           The late Mr Nicholson suffered severely from
           asthma for over forty years.  His eventual death
           related to a severe anterior myocardial
           infarction from which he initially recovered but
           with an unstable myocardium.  He had further
           chest pain which was likely to be due to further
           myocardial ischaemia early on 3rd January 1989
           and then suffered a respiratory arrest at about
           7.25 a.m.
           In my opinion, it is a reasonable hypothesis to
           state that the respiratory arrest was related to
           acute bronchospasm as a result of his accepted
           disability of asthma which had been precipitated
           by the stress of having further myocardial
           ischaemia.
           I also agree with Drs Fairbrother and Gavaghan
           that the presence of echocardiographic evidence
           of right ventricular dysfunction could well have
           been related to his chronic obstructive airways
           disease due to asthma and this cardiac damage
           would have contributed to his death."
6.  In his oral evidence Dr Miller referred to a "large dose" of morphine
given to the veteran not long before he died and said that morphine "is, in
general, contra-indicated in the presence of asthma because morphine causes
respiratory suppression."  He later gave the following evidence:
           "Summing up the various possibilities involved
           in that death, what in your opinion is the most
           likely causes, or cause, of his death?---I think
           the man is having chronic asthma, which was not
           treated with increased steroids, and therefore
           he would have a tendency to have low blood
           pressure and a possibility that he could have
           had high potassium precipitating arrhythmias,
           then given morphine which caused respiratory
           depression and that would have caused further
           anoxia and he would have stopped breathing -
           possibly with a severe attack of asthma with
           bronchospasm which would be very severe.
           How far does that scenario attribute his death
           to his asthma?---Considerably.  It's a major
           contributing factor.  It's quite impossible to
           say whether this is more his heart or more his
           asthma.  All I can say is the fact that this man
           had asthma, died in the way in which is
           described here, suggests to me that the asthma
           had a major contribution to his death."
(Where Dr Miller says "described here", he is referring to the clinical notes
relating to the veteran's admission to the hospital which were in evidence
before the Tribunal.)
7.  The respondent adduced evidence from Professor Ralph Blackett, a
cardiologist, who gave reasons why he disagreed with the hypotheses erected by
Dr Miller.  In cross-examination, he described an hypothesis suggesting that
asthma was implicated in the mechanism of the veteran's death as "very
fanciful."  Professor Blackett went on then to say that Dr Miller's
explanation was unlikely to be true, but he agreed with the proposition put to
him that it was an opinion which a responsible medical specialist could form
different to his own.
8.  The Tribunal concluded that "we find that none of the theories or
hypotheses put forward by the Applicant has a rational foundation, and that no
reasonable hypothesis has been raised on all of the evidence before us."
Counsel for the applicant submits (and counsel for the respondent accepts)
that the conclusion so stated represents the opinion of the Tribunal under s
120(3) of the Act.  Counsel for the applicant submits that the Tribunal has
misconstrued s 120 of the Act.
9.  The true construction of s 120 was explained by the High Court in Bushell
v. Repatriation Commission (1992) 66 ALJR 753, which was decided after the
Tribunal gave its decision in this case.  In dealing with the relationship
between s 120(1) and s 120(3), Mason C.J., Deane and McHugh JJ. said (at
775-756):
           "Notwithstanding the submission of counsel for
           the Commission, s 120(3) is not exhaustive of
           the content of s 120(1).  Subsection (3) is
           concerned with whether "the material" raises a
           reasonable hypothesis that the relevant injury,
           disease or death was connected with the service
           of the veteran.  It is not concerned with
           conflicts in the material, whether they be of
           opinion or fact.  The purpose of subs (3), as
           demonstrated by its terms and its history, is to
           ensure that a claim to which s 120 applies is
           not met unless there is some material which
           raises the relevant causal hypothesis.
                                 ...
           The material will raise a reasonable hypothesis
           within the meaning of s 120 (3) if the material
           points to some fact or facts (the raised facts)
           which support the hypothesis and if the
           hypothesis can be regarded as reasonable if the
           raised facts are true.  Clearly enough, a
           relevant consideration in forming an opinion
           whether a particular hypothesis is reasonable is
           whether, as a matter of common or medical
           experience, the occurrence of an injury etc of
           the kind sustained by the veteran is commonly
           accompanied by or associated with the occurrence
           of raised facts of the kind which constitute the
           relevant incidents of the service of the
           veteran.   However, a hypothesis may still be
           reasonable even though such an accompaniment or
           association is not demonstrated or even if it is
           shown to be uncommon.  So, in determining
           whether a hypothesis is reasonable for the
           purpose of s 120(3), it is not decisive that a
           connection has not been proved between the kind
           of injury which occurred and circumstances of
           the kind which constitute the relevant incidents
           of the veteran's service.  Nor is it decisive
           that the medical or scientific opinion which
           supports the hypothesis has little support in
           the medical profession or among scientists.
                                 ...
           However, a hypothesis cannot be reasonable if it
           is "contrary to proved scientific facts or to
           the known phenomena of nature."  Nor can it be
           reasonable if it is "obviously fanciful,
           impossible, incredible or not tenable or too
           remote or too tenuous" (East v Repatriation
           Commission (1987) 74 ALR 518 at 533).
           But leaving aside cases of those kinds, the case
           must be rare where it can be said that a
           hypothesis, based on the raised facts, is
           unreasonable when it is put forward by a medical
           practitioner who is eminent in the relevant
           field of knowledge.  Conflict with other medical
           opinions is not sufficient to reject a
           hypothesis as unreasonable.  As we have earlier
           pointed out, it is not the function of s 120(3)
           to require the Commission to choose between
           competing hypotheses or to determine whether one
           medical or scientific opinion is to be preferred
           to another.  This does not mean, however, that
           in performing its functions under s 120(3) the
           Commission cannot have regard to medical or
           scientific material which is opposed to the
           material which supports the veteran's claim.
           Indeed, the Commission is bound to have regard
           to the opposing material for the purpose of
           examining the validity of the reasoning which
           supports the claim that there is a connection
           between the incapacity or death and the service
           of a veteran.  But it is vital that the
           Commission keep in mind that that hypothesis may
           still be reasonable although it is unproved and
           opposed to the weight of informed opinion.
           If the material does raise a reasonable
           hypothesis of a connection between the service
           and the injury, disease or death, the claim must
           be dealt with in accordance with s 120(1).  That
           is to say, the Commission must determine that
           the injury, disease or death was war caused
           "unless it is satisfied beyond reasonable doubt,
           that there is no sufficient ground for making
           that determination."  The use of the terms "the
           material" and "raise" strongly suggest that subs
           (3) is not concerned with the proof or
           satisfaction of a claim but with whether there
           is some "material" which calls for determination
           under s 120(1).  The phrase "(i)n applying
           subsection (1) or (2)" (italics added) in s
           120(3) also suggests that s 120(1) is the
           governing provision.
                                 ...
           ... it is the duty of the Commission under s 120
           to decide the claim on the material before it
           and, unless there is material which raises a
           reasonable hypothesis connecting the operational
           service with the incapacity or death, there is
           nothing upon which the Commission can find that
           the incapacity or death was war caused within
           the meaning of s 120(1).  But once the material
           raises such a hypothesis, the operation of s
           120(3) is spent and the case falls to be
           determined in accordance with s 120(1).  That is
           to say, the Commission must determine that the
           injury etc was war-caused unless it is satisfied
           beyond reasonable doubt that there is no
           sufficient ground for making the determination.
           The Commission will be satisfied beyond
           reasonable doubt "that there is no sufficient
           ground for making (the) determination" if it is
           satisfied beyond reasonable doubt that it cannot
           accept the raised facts or so many of them as
           are necessary to support the hypothesis.  Thus,
           if the commission is satisfied beyond reasonable
           doubt that it cannot accept the raised facts
           because of the unreliability of the material
           which is claimed to support them or because of
           the superior reliability of other parts of the
           material before the Commission or because the
           raised facts depend on inferences which the
           Commission is satisfied cannot be drawn, the
           Commission will be satisfied that there is no
           sufficient ground for making the determination.
           But unless the Commission is satisfied beyond
           reasonable doubt that there is no sufficient
           ground for the factual foundation of the
           hypothesis, the claim must succeed; we cannot
           conceive of a case where, for the purpose of s
           120(3), the hypothesis is reasonable having
           regard to the raised facts, yet the Commission
           could be satisfied, "beyond reasonable doubt,
           that there is no sufficient ground for making
           the determination" even though the raised facts
           are not disproved.  Indeed, once there is
           sufficient factual material to point to a
           reasonable hypothesis connecting the injury etc
           with the operational service, it seems
           convenient simply to treat the case as governed
           by the application of s 120(1).  If that is
           done, the claim will succeed unless the
           Commission is satisfied beyond reasonable doubt
           that the factual foundation upon which the
           hypothesis can operate does not exist (cf Barca
           v the Queen (1975) 133 CLR 82 at 105).
10.  Counsel for the applicant submits that the errors in the Tribunal's
approach appear from the following passage in its reasons:
           "23.  The Tribunal notes the reference in the
           hospital notes to be "Found to be in resp.
           arrest at 07.30 - no output...".  On the basis
           of the medical evidence the Tribunal finds that
           this entry does not provide evidence of whether
           the respiratory arrest occurred before the
           cardiac arrest, nor does it indicate the
           respiratory arrest occurred at 07.30.  All it
           indicates is that at that time the Veteran was
           observed and when observed he was found to be in
           respiratory arrest.  In relation to the
           respiratory arrest Professor Blackett said -
           "..this would be a most unusual
           sequence in people who've had a
           myocardial infarction.  The usual
           sequence is that the heart fails and
           then seriatim, there are losses of
           cerebral function including loss of
           consciousness, which is the heart's
           function, and ultimately loss of
           function of the most brain-stem
           centres such as the respiratory centre."
           24.   The Tribunal finds, on the evidence before
           us that myocardial infarction was the cause of
           the death of Mr Nicholson and that he had
           suffered from asthma for about 40 years.  A
           number of possible mechanisms whereby the asthma
           would have contributed to death have been put
           before the Tribunal.  However, there is a
           paucity of documentation to indicate the
           presence, the degree and the severity of the
           asthma during his terminal illness.  Mrs
           Nicholson, although very helpful, was not able
           to judge that the Veteran's breathing problems
           were due to asthma.  There is evidence before
           the Tribunal by way of the clinical findings of
           basal creps and chest X-ray changes to indicate
           some degree of left ventricular failure which
           could at best in part explain the shortness of breath.
           25.   In respect of Dr Miller's hypothesis that
           asthma was a possible contribution factor, there
           is nothing before the Tribunal to indicate the
           possibility of severe bronchospasm as a terminal
           event precipitating respiratory failure.  The
           steroid hypothesis has little by way of support.
           The Tribunal could consider that if asthma had
           been a problem requiring more than his normal
           dose of Prednisone, the dosage would have been
           increased.  Professor Blackett did not support
           his hypothesis.  In oral evidence (transcript
           p 21) Dr Miller stated that in the absence of
           enough Cortisone there is a rise in potassium.
           The hospital records indicated the potassium to
           be low and not high.  The question of right
           ventricular dysfunction (cor pulmonale) was
           refuted by Professor Blackett who stated it was
           readily explainable on the basis of coronary
           artery disease and in any case survival depended
           ultimately on left ventricular performance.
           26.   Under cross examination Dr Miller agreed
           on the balance of probabilities that the
           infarction involved the right side of the heart
           as well as the left side of the heart, leaving
           Dr Gavaghan alone in his contention that there
           is some evidence of pre-existing chronic lung
           disorder and right ventricular impairment.  The
           question of the administration of Morphine in
           the last hour of life when there is obvious
           extension of the myocardial infarction is irrelevant.
                                 ...
           28.   ...The case file note of respiratory
           arrest has to be taken in content, as being only
           part of the terminal event and in no way
           indicative of asthma as the responsible factor.
           29.   The Tribunal finds that the Veteran died
           from an acute myocardial infarction and that the
           outcome would have been no different
           irrespective of the presence or absence of his
           asthma.  The possibilities of pre-existing right
           heart strain consequential of his asthmatic
           condition, the need for more Prednisone, the
           effect of Morphine administration, when measured
           against the extent and progression of the
           myocardial damage, are de minimus.  There is
           nothing to support the hypothesis that severe
           bronchospasm precipitated the terminal event.
           30.   The point was made by Beaumont J in
           Repatriation Commission v Webb 76 ALR 131 at
           p 135 in respect of establishing a 'reasonable
           hypothesis' that -
           "...it is a case of determining
           whether the particular theory has a
           rational foundation.  It is not a
           question of considering the
           probabilities or even the possibilities."
11.  I think that in the above passage the Tribunal is dealing, in the main,
with whether or not it accepts "the raised facts."  As the High Court has now
made clear, this is not an exercise that may be undertaken under s 120(3) for
the purpose of forming the opinion whether there is sufficient factual
material to point to a reasonable hypothesis connecting the veteran's death
with his operational service.  It seems to me that only the validity of the
reasoning connecting the morphine with death properly falls for consideration
under s 120(3).  The other hypotheses relating to the pre-existing right
ventricular impairment, bronchospasm and andrenal insufficiency depend upon
raised facts, which the Tribunal must be satisfied beyond reasonable doubt
that it cannot accept in order to reject the applicant's claim.  In my view,
it would certainly have been open to the Tribunal, had it come to consider the
application of s 120(1), to be satisfied on the material before it that the
raised facts were disproved beyond reasonable doubt.  However, that is not
what has happened in this case.
12.  Counsel for the respondent submits that in this case the tribunal has
simply found that there is not sufficient material within the meaning of s
120(3) to support the hypotheses.  I think that this submission must be
rejected and that the passage set out above from its reasons makes it plain
that the Tribunal has winnowed the material before it in a way not permitted
by s 120(3).  Counsel for the respondent also submitted that, whereas in
Bushell the Tribunal there had not made clear the basis upon which the
material before it persuaded it to one view or another, here the Tribunal had
given clear reasons for its decision.  It is true that in Bushell the High
Court did criticize the unsatisfactory nature of the reasons, but it also held
that the Tribunal had misconceived the task required of it by s 120.
13.  So too in the present case, the fact that the Tribunal has dealt with the
raised facts in the passage set out above as part of its consideration of the
question posed for its opinion under s 120(3) raises the inference that it
applied the wrong test or was "not in reality satisfied of the requisite
matters."  The Tribunal did state the standard of proof required under s
120(1) at the very start of its reasons.  However, it nowhere repeats that
standard when later finding some of the raised facts disproved.
14.  It follows that I consider the Tribunal erred in law.  The applicant is
entitled to have the Tribunal first consider whether the reasonable hypotheses
of connection required by s 120(3) of the Act are raised.  Only then can one
be sure that the applicant is not being deprived of the benefit of s 120(1) of
the Act.  Accordingly, I make the following orders:
      1.   The decision of the Administrative Appeals Tribunal dated 3
           June 1992 is set aside.
      2.   The case is remitted to be heard and decided again by the
           Administrative Appeals Tribunal.
      3.   The respondent is to pay the applicant's costs.