Angell and Department of Family and Community Services

[2000] AATA 1062

DECISION AND REASONS FOR DECISION [2000] AATA 1062

ADMINISTRATIVE APPEALS TRIBUNAL      )

)     No N2000/948

GENERAL ADMINISTRATIVE DIVISION          )          

Re      Lisa Maree ANGELL         

Applicant

And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES        

Respondent

DECISION

Tribunal       Mrs M T Lewis, Senior Member    

Date1 December 2000

PlaceSydney

Decision      The Tribunal sets aside the decision of the Social Security Appeals Tribunal of 24 May 2000 and the decision of the delegate of the Secretary, Department of Family and Community Services dated 29 November 1999, and in substitution therefor the Tribunal decides that the overpayment of Parenting Payment to Lisa Maree Angell ("the Applicant") of $2964 arose solely as a result of administrative error and that it was received by the Applicant in good faith, and in consequence pursuant to s1237A. of the Social Security Act 1991 the full amount of the overpayment is waived. The Tribunal directs that the Respondent repay to the Applicant that money which has already been withheld from her Parenting Payment through recovery action.

..............................................
  M T Lewis
  Senior Member
            CATCHWORDS
SOCIAL SECURITY – debt – parenting payment – whether sole administrative error – whether received overpayment in good faith - husband received sickness allowance - husband advised he had recommenced employment – applicant did not know of debt – whether applicant should have checked bank statements - waiver due to sole administrative error

Social Security Act 1991 – s 1237A

Secretary, Department of Employment Education and Training v Prince (1997) 152 ALR 127
Telha and Secretary, Department of Social Security (1998) 54 ALD 209  

REASONS FOR DECISION

Mrs M T Lewis, Senior Member                

1. This is a review of a decision of the Social Security Appeals Tribunal made on 24 May 2000 that affirmed a decision of a delegate of the Secretary, Department of Family and Community Services ("the Respondent") dated 29 November 1999 to raise and recover a debt of $2,964 arising from an overpayment of Parenting Payment to Lisa Angel ("the Applicant") for the period 20 May 1999 to 4 November 1999.  That decision was reviewed and affirmed by an Authorised Review Officer on 18 January 2000.  The Applicant lodged an application for review by this Tribunal on 20 June 2000.

2. The Tribunal had before it the documents produced by the Respondent pursuant to s37 of the Administrative Appeals Tribunal Act 1975. The Applicant tendered a letter addressed to Mr Robin Potts at the Applicant's address, dated 14 January 2000 (exhibit A). On behalf of the Respondent the following documents were tendered –

• Computer printout of repayment history in respect of the Applicant (exhibit 1);

• Text of letters to Lisa Barker dated 1 March 2000 (exhibit 2) and 11 March 2000 (exhibit 3);

The Applicant was unrepresented at the hearing.  She gave oral evidence.  The Respondent was represented by an advocate from Centrelink.

1. The history of this matter is that the Applicant has received Parenting Payment since 21 November 1998 when her first child was born.  At the time of commencement of Parenting Payment the Applicant's husband was in full-time employment.  In February 1999 Mr Angell had a knee reconstruction.  He applied for and received Sickness Allowance during his period of incapacity from February until May 1999.  The Respondent acknowledged that as a result of Mr Angell's grant of Sickness Allowance the Applicant's payments should have been changed from one paid to the partner of a person in receipt of an income to one paid to the partner of a person in receipt of a benefit.  That did not happen immediately. 

2. The chronology of events relating to changes in the payments made to the Applicant is significant, and this is set out below:

• The Applicant received $65.50 per fortnight Parenting Payment when her claim was first granted in December 1998 following the birth of her child on 21 November 1998.

• A letter was sent to Mr Angell by the Respondent dated 24 February 1999 that Sickness Allowance had been granted.  The Applicant had no instructions as to whether Mr Angell had received that letter.

• On 1 March 1999 the Applicant was advised by letter that she would receive $65.50 per fortnight and arrears of $226.30 would also be paid (exhibit 2).  In that letter it was noted that this calculation had been made on the basis that her income was $0.00 per fortnight.  She was asked to notify within 14 days if her income or her partner's income changed.

• The Applicant's evidence was that after her husband ceased work because of his knee reconstruction money was short and their only income was from the Respondent.  She found when she attempted to withdraw from their joint bank account that there were insufficient funds in that account, and this alerted her to make a telephone inquiry to the Respondent asking whether the correct payments were being made to her.

• There is a computerised file note on 4 March 1999 to the effect that the Applicant made a telephone inquiry of the Respondent (T8, p29).  It was noted that she was receiving the minimum Parenting Payment, whereas she should have been receiving the maximum payment.   It would appear from that file note that action to redress this error was to have been taken on 5 March 1999 but was not done, and again on 11 March 1999 it was noted that the action to redress had not been done.  There is a further file note on 8 March 1999 (T9 p30) indicating a telephone call from the Applicant wondering why her Parenting Payment was only $65.50 per fortnight when her husband was receiving Sickness Allowance.  It would appear from the file note (T8, p29) that the error was subsequently corrected on 11 March.  A file note on 8 March 1999 (T9, p31) recorded that:

  A/n is upset that she keeps phoning & no one phones her back.  I advised a/n that the phones are down today which is documented on record but there is no message to pass on to customer.  Can you pls F/u asap & if there is no message to pass on to customer. Can you pls f/u asap & if there will still be problems with phone put a message up so that this can be relayed to customer.

  In cross-examination the Applicant admitted that she had made a few telephone calls at about this time which were not returned, and that was the reason for her follow-up telephone calls. 

• A letter was then sent to the Applicant dated 11 March 1999 (exhibit 3) noting that she was to be paid Parenting Payment of $291.80 each fortnight.  Again, she was advised that the income used to assess her entitlement was $0.00 and if this changed in respect of her or her husband she would advise within 14 days.  The Applicant accepted that she received this letter.

• The Applicant said in evidence that she telephoned the Nowra office of Centrelink to advise that with regard to her husband's Sickness Allowance he had returned to work and she also advised that her Parenting Payment would now need to be adjusted.  She said in effect that she was advised that the adjustment to her Parenting Payment would happen automatically because the computer was cross-referenced, but she was asked to get her husband to send a fax saying that her had returned to work, and he did this.  The fax, that was received by Centrelink on 13 May 1999 (T3, p11), read –

  Attn to Sickness Benefits
  My name is Daniel Angell, and have been receiving Sickness Benefits.  I have now recommenced work in my place of full time employment.
  Thankyou
  Daniel Angell
  8 Winn Ave
  Basin View 2540
  (the document was signed "Daniel Angell")

• T5, p19, purports to be a letter sent to the Applicant dated 13 May 1999 (that is, the same day as the fax was received from the Applicant's husband saying that he had returned to work), advising that commencing on 20 May 1999 she will be paid Parenting Payment at the rate of $293.80 each fortnight, and noting that this was calculated on the basis that her income and that of her partner was $0.00 per fortnight.  She was asked in that letter to advise within 14 days if her partner's personal income went over $503 per fortnight.  It was the Applicant's evidence that she did not receive that letter. 

• A letter was also sent to Mr Angell dated 13 May 1999 (T4, p13) (that is, on the same day as the abovementioned letter to the Applicant), noting that his Sickness Allowance would cease from 13 May 1999 because he had returned to work.  It was the Applicant's evidence that she recalled her husband receiving that letter. 

1. The Applicant said in her oral evidence that after her husband returned to work following his knee operation she and her husband attended the Centrelink office about November 1999 because he had been made redundant in his employment and he was considering setting himself up in his own business.  They were inquiring of Centrelink about the financial assistance available to do this.  She said that in the course of that inquiry she was advised, when the Centrelink officer accessed her computer record, that she had been overpaid Parenting Payment as she was being paid on the basis that she and her husband had no other income. 

2. From the Centrelink records it would appear that the Applicant and her husband visited Centrelink on 16 November 1999.  The following computer record was made of that visit  (T18, p49) –

   I spoke to the a/n & her husband 16 11 99.  He RTW f/t about 27.4.99 & has been earning $1000+ pf since.  She has continued to get max rate PGA!  Considerable o/p.  They also supplied an SU1 showing he ceased work 29 10 99 & got 20 days rec leave – IMP coded.  I have investigated the O/P.  They have definately (sic) been o/p & I calc this to be $2964.00 for the period 20.5.99 – 4.11.99 inclusive.  I have considered waiver but good faith is not established as they were issued an auto advice to the wife 13.5.99 stating that her PGA had been reassessed using "her partner's income of $0.00 per fortnight" – Debt to be raised.

The letter dated 13 May 1999 was the letter that the Applicant said in oral evidence she did not receive.

1. The Applicant said that her Parenting Payment has always been paid into a joint National Bank account that is also the account that carried their housing loan.  She said that it is always in debit.  Mr Angell's salary also used to be paid into that account when he was employed, as a direct debit.  Indeed, it is the only bank account they have.  Ultimately Mr Angell did develop his own business relating to airconditioning, and to do that they used the equity in their house.  She said that even now the bank account also covers their business operations as well as her income from Parenting Payments. 

2. The Applicant said that at the time of the overpayment, and indeed prior to that, she did not examine the bank statements when they were received.  They were merely filed.  She had assumed that her Parenting Payments were being deposited into that account at the correct rate because of her telephone call to Centrelink in May 1999.  The financial pressure had abated when Mr Angell had returned to work, and there was nothing to motivate her to check the bank statements when this had not been her normal practice.  The Applicant said that she had no reason to access and check those bank statements at any time prior to their inquiry to Centrelink in November 1999 about Mr Angell's consideration of setting up a business. Therefore she had no knowledge that she had been overpaid Parenting Payment until advised by Centrelink of the error and the overpayment. 

3. The issue of whether the Applicant received the letter to her from Centrelink dated 13 May 1999 is the turning point in this decision.  If she received that letter, then she had been advised by Centrelink that the basis of the calculation of payment of her Parenting Payment was that her and Mr Angell's income was $0.00 per fortnight.  In that case she should have advised within 14 days that in fact his income was in excess of $1000 per fortnight.  However, her sworn evidence was that she did not receive the letter. 

4. The Tribunal notes that the Applicant recalled that her husband received the letter from Centrelink sent to him on that same day, but she maintained steadfastly that she did not receive the letter addressed to her bearing the same date.  There were no adverse submissions made on behalf of the Respondent in respect of the Applicant's credit.  The Tribunal finds that the Applicant was an impressive witness who gave her evidence and conducted her case in a clear, succinct and forthright manner.  She presented as a witness of truth.  She maintained that she did not receive the letter and notes that as she has received correspondence addressed to other Social Security beneficiaries at her address, obviously wrongly addressed (exhibit A) it is reasonable to assume that communication intended for her could have been sent elsewhere.  She said that the wrongly addressed letter had been sent at the time she was negotiating with the authorised review officer and when she told the authorised review officer about it her response was tantamount to an acknowledgment that she had sent the letter in error.  The Applicant considered that if that error could have occurred, then an error resulting in the letter dated 13 May 1999 not being forwarded to her could have occurred. 

5. It was submitted for the Respondent that even though the previous decisions in this matter had been made in relation to sole administrative error, it was now the Respondent's case that the error also occurred as a result of the Applicant not notifying of her husband's income within 14 days of her receipt of their letter of 13 May 1999.  Even if it were found that the Applicant did not contribute to the error, it was submitted that she could not be said to continue to have received the higher rate of payment in good faith.  She demonstrated in March 1999 that she understood that when her partner was in receipt of a Centrelink payment she was entitled to payment at a higher rate.  As such, it was submitted it was reasonable that she also understood that Parenting Payment was not payable to her at the higher rate when her partner was not in receipt of Sickness Allowance.  It was submitted that she had access to the bank account into which the payments were made.  Because she did not turn her awareness to the rate of payment being paid into her bank account by perusing her bank statement or otherwise informing herself of the rate at which she was being paid, she did not demonstrate good faith.

6. It was submitted that this matter can be distinguished from the Tribunal's decision Re Telha and Secretary, Department of Social Security (1998) 54 ALD 209 in which the applicant made numerous attempts to advise the respondent of her income from part-time work including in person, by telephone, and, on the instructions of departmental officers, on her husband's fortnightly SU19 continuation form. It was noted Re Telha (supra) that for a short period while she continued to question the rate of payments she received the Federal Court decision in Secretary, Department of Employment Education and Training vPrince (1997) 152 ALR 127 was applied.

7. It was submitted for the Respondent that in the present matter the Applicant had not complied with her notification obligations, nor did she believe that she was entitled to the higher rate of payment. She did not apprise herself of information that was readily available to her (in the form of her bank statements) as to the amount of her payments.

8. It was submitted that as any administrative error that might have occurred was not the sole cause of the debt from 14 days after the date of the letter of 13 May 1999, s1237A(1) cannot be applied to waive the debt as both elements of the provision have not been met.
   the legislation

9. Section 1237A(1) of the Social Security Act 1991 ("the Act") provides for waiver of a debt arising from error:

   1237A(1)        Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.

   Note:Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).

   1237A(1A)      Subsection (1) only applies if:

   (a)the debt is not raised within a period of 6 weeks from the first payment that caused the debt; or

   (b)if the debt arose because a person has complied with a notification obligation, the debt is not raised within a period of 6 weeks from the end of the notification period;

   whichever is the later.

consideration of evidence and findings of fact

1. The Tribunal finds that on the Applicant's evidence, which it accepts, she did not receive the notice dated 13 May 1999 advising her that, in effect, the rate of payment of Parenting Payment continued to be the same as that which she received when her husband was in receipt of Sickness Allowance.  Similarly, she did not receive notification that the basis of the calculation of Parenting Payment was that her income and that of her husband was $0.00, and that if there was any change in their income she was to advise within 14 days. 

2. The Tribunal finds that the overpayment was made solely as a result of administrative error, and that the Applicant received the payment in good faith and absolutely without knowledge until 16 November 1999 that the payment had been made into her joint bank account.  The Tribunal considers that the facts in this case can be distinguished quite clearly from those in Prince (supra) and Re Telha.  In Prince the Federal Court found that the overpayment had not been received in good faith as Mr Prince had at all relevant times been aware that he had been overpaid notwithstanding that his attempts to have the error rectified were ineffective.  There were similar facts in Re Telha.  In the matter now before the Tribunal the Applicant had no knowledge of the overpayment. 

3. It was the Respondent's case that she could have and should have checked her bank statement to ensure that she was receiving the correct amount of Parenting Payment, and had she done so she would have become aware of the error at an earlier point in time.  The Tribunal accepts the Applicant's evidence that it was not her habit to check her bank statements, and while that might appear to many to be quite gullible that is not a reason to find that the Applicant did not act in good faith.  The Tribunal notes that she said she now checks all her bank statements and advises others with whom she has contact to do the same in relation to Social Security payments. 

4. The Respondent concedes that an administrative error occurred.  The Tribunal finds that the overpayment occurred solely as a result of administrative error, and having found on the evidence that the Applicant received the money in good faith, and that she did not receive the letter dated 13 May 1999 which would have alerted her to the error, the Tribunal determines that pursuant to s 1237A(1) the debt must be waived.

5. The Tribunal notes the Respondent's advice that some money has already been recovered from the Applicant (exhibit 1).  The Tribunal directs that the money already recovered be returned to the Applicant. 

   I certify that the 20 preceding paragraphs are a true copy of the reasons for the decision herein of Mrs M T Lewis, Senior Member

   Signed:         .....................................................................................
     Associate

   Date of Hearing  16 November 2000
   Date of Decision  1 December 2000
   Solicitor for the Applicant         Self-represented
   Advocate for the Respondent  Ms Cheryl Collis, Centrelink Advocate