Bell; Secretary, Department of Social Services and (Social services second review)

This matter concerned an appeal by Mrs Bell against a decision by the Secretary of the Department of Social Services regarding her entitlement to a Carer Payment. The dispute centred on whether certain cash injections made by Mrs Bell and her late husband into a private company, Northern Rivers Property Pty Ltd (NRP), should be characterised as loans or investments, and whether these had been disposed of for less than their value, impacting her assets for social security purposes. The case was heard by R Bellamy SM.

The primary legal issue before the Tribunal was to determine the true characterisation of the funds advanced by Mrs Bell and her late husband to NRP. Specifically, the Tribunal had to consider whether these advances, recorded in company financial statements as unsecured loans, were in fact investments, and if so, whether the subsequent sale of shares for a nominal sum constituted a disposal of assets for less than their value, thereby affecting Mrs Bell's eligibility for a Carer Payment.

The Tribunal found that the company’s financial statements consistently recorded the advances as unsecured loans, both to Mrs Bell and her late husband, and later to their superannuation fund. Despite Mrs Bell's assertion that these were investments, the Tribunal gave little weight to her recollection due to her confused understanding of financial matters and contradictory statements. The Tribunal noted that the fluctuating amounts recorded as loans between 2008 and 2011 were difficult to reconcile with the concept of share value, and that these loans continued to be listed as liabilities until at least 2019. Furthermore, the Tribunal considered the evidence of Mr Serjeant, who prepared the company’s financial statements and tax returns, and who had provided a sale agreement for the disposal of loans and later stated the "investment" was always an investment, finding this to be in direct contradiction to other evidence. Applying the principle from *Bennett; Secretary, Department of Social Services and (Social services second review)*, the Tribunal held that company financial records, which correctly record and explain financial transactions, are admissible in evidence and are prima facie evidence of their contents unless disproved.

The Tribunal concluded that the evidence overwhelmingly supported the characterisation of the cash injections as loans, not investments. Consequently, the sale of shares for $1 per share did not represent a disposal of assets for less than their value in the context of investments, as there were no proven investments to dispose of. The Tribunal found that the company's liabilities were largely comprised of money owed to directors, consistent with the treatment of advances as loans.