Barnes and Secretary, Department of Education, Employment and Workplace Relations and Anor

[2010] AATA 1041

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 1041

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No  2009/3573

GENERAL ADMINISTRATIVE DIVISION		)
Re		AMANDA BARNES

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORPLACE RELATIONS

Respondent

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal  Senior Member Bernard J McCabe

Date 22 December 2010

Place Brisbane (heard at the Gold Coast)

Decision The Tribunal sets aside the decision under review and decides in substitution that the applicant was not in a de facto relationship in the period under review.

................[Sgd]..............................

Senior Member

CATCHWORDS

SOCIAL SECURITY – parenting payment at single rate – family tax benefit – whether applicant involved in a de facto relationship – financial aspects – nature of the household –casual sexual relationship – nature of the commitment – decision set aside.

Social Security Act 1991 (Cth), s 4

REASONS FOR DECISION

22 December 2010  Senior Member Bernard J McCabe        

1. The decision in this case turns on the question of whether the applicant, Ms Amanda Barnes, was involved in a de facto relationship with Mr Smith (a pseudonym) for the period 17 September 1998 through 17 January 2008 while she was in receipt of parenting payment at the single rate and family tax benefit. If she was involved in a de facto relationship within the meaning of s 4(2) of the Social Security Act 1991 (“the Act”), she was not entitled to be paid those amounts (or to be paid at the rate she was paid).

2.      For reasons I will explain, I am satisfied the applicant was not engaged in a de facto relationship with Mr Smith during the period under review.

The legislation

3. Section 4(2) says the respondents should treat individuals as members of a couple if their relationship satisfies certain criteria. The criteria relevant to this case are set out in s 4(3). That sub-section provides:

Member of a couple--criteria for forming opinion about relationship

(3)  In forming an opinion about the relationship between 2 people for the purposes of paragraph (2)(a), subparagraph (2)(aa)(ii) or subparagraph (2)(b)(iii), the Secretary is to have regard to all the circumstances of the relationship including, in particular, the following matters:

(a)  the financial aspects of the relationship, including:

(i)  any joint ownership of real estate or other major assets and any joint liabilities; and

(ii)  any significant pooling of financial resources especially in relation to major financial commitments; and

(iii)  any legal obligations owed by one person in respect of the other person; and

(iv)  the basis of any sharing of day‑to‑day household expenses;

(b)  the nature of the household, including:

(i)  any joint responsibility for providing care or support of children; and

(ii)  the living arrangements of the people; and

(iii)  the basis on which responsibility for housework is distributed;

(c)  the social aspects of the relationship, including:

(i)  whether the people hold themselves out as married to, or in a de facto relationship with , each other; and

(ii)  the assessment of friends and regular associates of the people about the nature of their relationship; and

(iii)  the basis on which the people make plans for, or engage in, joint social activities;

(d)  any sexual relationship between the people;

(e)  the nature of the people's commitment to each other, including:

(i)  the length of the relationship; and

(ii)  the nature of any companionship and emotional support that the people provide to each other; and

(iii)  whether the people consider that the relationship is likely to continue indefinitely; and

(iv)  whether the people see their relationship as a marriage‑like relationship or a de facto relationship.

4.      The opening words of the sub-section are important. They require that I form a view having regard to all of the circumstances of the relationship, albeit that my attention is drawn specifically to a number of matters. It is a characterisation process. I will deal with the evidence in relation to each of the nominated criteria before reaching a concluded view.

Background facts

5.      The applicant is a mother of four children living on the Gold Coast. Three of the children reside with her. Those three children were fathered by Mr Smith. Ms Barnes and Mr Smith have known each other since she was a schoolgirl; Mr Smith was a friend of one of her brothers. She explained in her evidence at the hearing that the two of them were members of the same social set and frequently mixed together over the years. She subsequently married another man, although I infer Mr Smith and the applicant remained part of the same social set during that time.

6.      After the applicant’s marriage broke down, she saw Mr Smith socially. She said in her oral evidence that they began to date each other around 1997, although her description of the relationship suggested it could really be described as “friends with benefits”, to use the modern expression. She insisted that they never had an exclusive relationship; both of them saw other people. Ms Barnes also denied that Mr Smith lived with her at any time (apart from a brief period after her divorce where he was effectively a boarder in her home). She acknowledged he occasionally stayed the night but insisted that they did not otherwise share a home during the relevant period.

7.      Ms Barnes said her relationship with Mr Smith was coloured by his drug abuse. He was not a stable person and he disappeared for periods of time. While they continued to see each other over a long period, their interaction (and his interaction with their children) was inevitably limited by the consequences of his drug problem.

8.      I am satisfied Ms Barnes was a truthful witness who did her best to assist the Tribunal. I acknowledge that we are considering her affairs over a 12 year period, and she has had understandable difficulty in obtaining documentary evidence. The respondents had a great deal more success in obtaining documents. I was provided with eight meticulously prepared volumes of “T” documents.

9.      While there is a good deal of objective evidence to be considered, I found the applicant’s oral evidence to be particularly compelling. She was skilfully examined in relation to many of these matters by Ms Pendle on behalf of the respondents. After hearing the applicant’s oral evidence, I am satisfied the documents did not tell the whole story. I did not have the benefit of hearing from Mr Smith. In the circumstances, I do not think that should count against Ms Barnes because it seems clear enough that she has little control or influence over him.

(a)  the financial aspects of the relationship

10.     The applicant is a self-employed book-keeper. Mr Smith has a patchy employment history as a paver and he was constantly in financial difficulty. She says she only received child support payments from Mr Smith for a short period. She said he would occasionally make a contribution towards expenses for the children but she also gave him money on occasions when he was seeing the children if he was not in a position to pay. He occasionally contributed towards the cost of maintenance on the property but she loaned him money a couple of times a year. She has also paid fines on his behalf on a few occasions and met other expenses. I do not think the evidence suggests the applicant and Mr Smith share the household expenses in any meaningful way. There is evidence of payments being made from Mr Smith’s account to the applicant on a number of occasions.

11.     The applicant and Mr Smith own a house in joint names, and they completed a loan application together. They have a joint account but the applicant says that was a requirement under the terms of the home loan. She said they bought the property as a business proposition, although she now resides there. She could not afford the property on her own and she was a single mother at the time it was purchased; he was happy enough to participate in the investment. She says he may have made an initial contribution towards the repayments but she has otherwise been responsible for the repayments. She meets most of the costs associated with maintaining the property. She doubts he has any equity in the property.

12.     Ms Barnes says she does not otherwise mix her finances with Mr Smith, and has never done so. There are no other joint loans, accounts or credit cards. There does not appear to be significant joint pooling of resources. I am not aware of any legal obligations between the applicant and Mr Smith. She accepts he was nominated as a beneficiary under her health insurance, but she says that was a favour that enabled him to obtain some assistance for his drug problem. She said she subsequently asked that his name be removed from the policy. She agrees that she and the children were nominated as beneficiaries under his superannuation, but thought that was appropriate given she was raising their children.

13.     There has certainly been some financial interaction between Ms Barnes and Mr Smith. Their financial affairs are intermingled to some extent. That intermingling is consistent with there being a de facto relationship, but nor is it necessarily inconsistent with the applicant’s characterisation of the relationship as one of mutual convenience.

(b)  the nature of the household

14.     Mr Smith saw his children on a reasonably regular basis throughout the period under review – as often as a couple of times a week at one point - although it seems there were also significant periods where there was no regular contact. Ms Barnes suggested that was partly because Mr Smith’s life was chaotic as a result of his drug use. I am satisfied the applicant was responsible for the care and custody of the children throughout the period under review. She made it clear that Mr Smith was not involved in discussions with schools or in relation to the occasional medical issue. In other words, he fulfilled few of the responsibilities one would expect of a parent or guardian. I have already noted his financial support of the children was limited and sporadic.

15.     I accept Ms Barnes’s evidence that Mr Smith may have been a regular visitor to her home, but he did not live there other than for one brief period as a boarder after she was separated from her husband (which was probably before the period under review in any case). She said he had his own accommodation and occasionally lived with his brother. She said he was not permitted to reside with her while she lived in Housing Commission accommodation. He did not live with her after she moved to the property they purchased together, although he left his vehicle there and visited regularly.

16.     I note that Mr Smith appears to have nominated the applicant’s address as his home on a number of documents. It is unclear why he did so. It may have been convenient for him. She says he used her post box, but thought nothing of it.

17.     There is no evidence that the two shared housework or other household responsibilities.

18.     The nature of the household does not exhibit many of the features of a de facto relationship.

(c)  the social aspects of the relationship

19.     The respondents provided evidence suggesting the applicant and Mr Smith identified themselves as being partners in a number of documents provided to their bank, the private health insurer and the hospital where the children were born. There was also evidence about an Austar pay television contract being taken out in their joint names.

20.     Ms Barnes said the Austar contract for pay television was organised by Mr Smith. She could not account for his decision to name her on the contract. She agreed she had been identified as Mr Smith’s partner who lived with him in a number of other documents but pointed out that the documents were not always internally consistent: for example, in the admission forms that were signed when her son was born at John Flynn hospital, Mr Smith was recognised as the partner but her mother was listed as next of kin. I have already referred to the circumstances in which the applicant nominated Mr Smith as a beneficiary under her health insurance policy.

21.     The applicant agreed she had completed the BAS for Mr Smith on a regular basis but pointed out she was a book-keeper. She did that for a living.

22.     Ms Barnes says her friends and relatives knew she had a relationship with Mr Smith but they were all aware of his problems and counselled her against becoming too closely involved with him. She said they all knew it was not an exclusive relationship, and it seems no one who knew them would have regarded them as a couple. She said they would go out together but usually in a group before the children were born. Once the children were born, Ms Barnes said her social life all but ceased.

23.     I was left with the strong impression that the applicant and Mr Smith were capable of identifying themselves as members of a couple when it was convenient for them to do so. But they did not do normally that in a social context. I do not think this indicator points decisively towards the existence of a de facto relationship.

(d)  any sexual relationship between the people

24.     The applicant and Mr Smith had a long-running sexual relationship. They had three children together. I am satisfied from the applicant’s evidence that the interaction was frequent but casual. I do not think this indicator points clearly to the existence of a de facto relationship.

(e)  the nature of the people's commitment to each other

25.     The relationship lasted for a long time. It is still spluttering on, it seems. The applicant and Mr Smith clearly enjoy some sort of companionship and they have enjoyed some level of emotional support over time. Perhaps unsurprisingly, the applicant’s evidence downplays the extent of that support and companionship. While I am conscious that the evidence may be self-serving, the applicant’s description of Mr Smith’s involvement in her family’s life and of his own problems does not suggest a strong relationship. It appears to be one sustained by habit and their children. It is unclear from the evidence whether the relationship will endure, or on what basis.

26.     The applicant and Mr Smith clearly have some level of commitment towards each other. Mr Smith does not appear to have much to offer her, yet the relationship has endured. They have certainly assisted each other from time to time: eg, when he joined with her to buy a property, and when she allowed him to be nominated as a beneficiary on her health insurance. Some of that involvement cannot simply be explained by the fact they have children. The applicant made it clear she saw Mr Smith’s shortcomings with clear eyes. It was also clear that Mr Smith was not prepared to assist with these proceedings even though Ms Barnes might have benefitted from his evidence. They exhibit more commitment than one would expect from individuals who were just casual acquaintances or even friends. But can they be said to be members of a couple? It seems to me that the evidence does not point strongly towards that conclusion.

Conclusion

27.     I am required to characterise the relationship having regard to all of the evidence. When I weigh up all the matters that I have discussed, I am not satisfied this is a de facto relationship. It certainly bears some of the hallmarks of such a relationship – most obviously the financial interaction, the children and the inconsistent identification of themselves as partners in some documents - but I am ultimately satisfied the interaction of these two individuals was opportunistic and the product of convenience.  To repeat a phrase I used earlier, they are “friends with benefits”.

28.     I would set aside the decision under review and decide in substitution that the applicant was not in a de facto relationship with the man I have referred to as Mr Smith in the period under review.

I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member Bernard J McCabe.

Signed: ............................[Sgd]...............................................
  Patrick MacDonald

Date of Hearing  3 November 2010 
Date of Decision  22 December 2010
Applicant  Self-represented

Solicitor for the Respondent          Leisa Pendle, Australian Government Solicitor