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

[2018] AATA 3852

Benham and Secretary, Department of Social Services (Social services second review) [2018] AATA 3852 (15 October 2018)

Division:GENERAL DIVISION

File Number(s):      2018/5141

Re:Danielle Benham

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Mark Hyman, Member

Date:15 October 2018

Place:Canberra

The application for a stay order is granted with respect to ongoing payments from the next day on which social security benefits are regularly paid. The application for a stay order is denied in respect of arrears of payment from the date of cancellation of disability support pension to the present.

........................................................................

Mark Hyman, Member

Catchwords

PRACTICE AND PROCEDURE – cancellation of disability support pension – application for a stay of decision – principles governing a stay – prospects of success – prejudice to the respondent – recovery of overpayments – financial hardship – public interest – whether the appeal might be rendered nugatory – stay not granted in respect of arrears but granted in respect of ongoing payments

Legislation

Administrative Appeals Tribunal Act 1975 s 41

Social Security Act 1991 s 94, Ch 5

Cases

Dart and Director-General of Social Services (1982) 4 ALD 553

Kurukkal and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 146

Repatriation Commission and Delkou [1985] AATA 297

Secretary, Department of Employment and Workplace Relations and Anastasiadis [2007] AATA 1065

Secretary, Department of Families, Housing, Community Services and Indigenous Affairs v Mouratidis [2010] FCA 880

REASONS FOR DECISION

Mark Hyman, Member

15 October 2018

1. This decision is about whether a stay should be granted preventing the operation of a decision taken by the respondent, the Secretary, Department of Social Services, cancelling the disability support pension (DSP) previously granted to Ms Danielle Benham, the applicant. Ms Benham was granted DSP in 2001. On 25 June 2018 the Department of Human Services (the Department) cancelled her pension on the grounds that she was no longer qualified, and that decision was affirmed at first review by this tribunal on 30 August 2018. Ms Benham has now applied for further review by this tribunal.

2. Ms Benham has found herself in significant financial difficulties without the income provided by the DSP and has sought a stay on the operation of the decision pending her review. The effect of a stay would be that she would continue to receive DSP until the review is completed and a decision is taken. The Secretary opposes the grant of a stay.

3. The tribunal held an interlocutory hearing on 2 October 2018. Ms Benham appeared by telephone, as did the Secretary’s representative, Ms Charlie Inglis, a departmental advocate. The documents before the tribunal for the purpose of the stay application include submissions and supporting medical documentation provided by Ms Benham; a submission and supporting information provided by the Secretary; and some of the initial documentation in the application for review, including the decision of this tribunal at first review (i.e. the decision under review in the substantive application).

   THE ISSUE

4. The only issue before the tribunal is whether a stay of the decision under review should be granted.

   LEGISLATIVE FRAMEWORK

5. Subsection 41(1) of the Administrative Appeals Tribunal Act 1975 (the AAT Act) provides that, subject to the section, an application for review of a decision does not affect the operation or implementation of the decision. Subsection 41(2) reads as follows:

   (2)  The Tribunal may, on request being made by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.

6. Subsequent subsections provide for the variation or revocation of a stay order and for interested parties to be given an opportunity to make submissions.

7. The requirements for grant of DSP are set in subsection 94(1) of the Social Security Act 1991 (the Social Security Act). The essential requirements are that a person must have one or more impairments; that the impairments together must be rated at 20 points under the Impairment Tables; and that the person must have a continuing inability to work. The Impairment Tables are in a legislative instrument made under the Social Security Act and are used to assess the permanence of impairments and rate their severity. An impairment is permanent if it is fully diagnosed, fully treated and fully stabilised, and expected to continue for at least the next two years. Only if a condition is permanent can it be rated for severity under the various tables set out in the Impairment Tables.

   MS BENHAM’S ARGUMENTS

8. Ms Benham has been on DSP for about 17 years. Earlier this year she sought indefinite portability (i.e. she applied for approval to receive DSP while travelling overseas for an indefinite or unlimited period, which is only available under limited circumstances), and that application prompted a review by the Department. In that review the Department decided that Ms Benham was no longer qualified for DSP.

9. Ms Benham seeks a stay to be granted on the basis that she has a strong case in the matter under review and her ability to manage in the absence of a stay will be compromised to the point where she may become homeless and at the least will have to surrender rental goods (especially white goods) on which she relies for the basic activities of daily life. Ms Benham says in her submissions that:

   ·she is unable to pay her rent at $500 per fortnight and is at risk of losing her accommodation;

   ·she has exhausted her mobile phone credit so that continuing contact with people in support of her case is now difficult or impossible;

   ·she is at risk of having her refrigerator, television and laptop taken from her (these are under rental agreements);

   ·she is unable to pay her internet bill and has had to arrange special plans to manage her electricity and gas bills; and

   ·she cannot even afford to see her treating practitioners, whose evidence she needs in order to make her case for continued payment of DSP.

10. Ms Benham further stated that she is unable to receive newstart allowance (the usual alternative to DSP, although it is paid at a significantly lower rate than DSP and requires participation activities) because her disabilities are permanent, and she cannot therefore complete the application form, which limits applicants to those with at most temporary conditions.

11. Ms Benham’s circumstances are that she lives in rented accommodation with her 13-year old daughter and two adult sons, both unemployed. She receives family assistance fortnightly to help with the support of her daughter.

12. Ms Benham’s claim to the DSP rests on two conditions: a mental health condition and a condition of the spine. A job capacity assessor in the Department assessed Ms Benham on 9 May 2018 and decided that both conditions were fully diagnosed but not fully treated or fully stabilised. On 25 June 2018 an authorised review officer from the Department took a decision on Ms Benham’s cancellation, evidently affirming it (that decision is not available to me). The tribunal on first review decided that the two conditions were fully diagnosed, fully treated and fully stabilised, and were therefore permanent. But the Member decided both conditions were mild rather than moderate or severe, and gave a rating of five points for each, giving a total of 10 points. This is less than the 20 points necessary to meet the criterion set in paragraph 94(1)(b) of the Social Security Act.

13. A brief report dated 19 September 2018 by Dr Susette Sowden, a clinical and forensic psychologist, diagnosed Ms Benham with post-traumatic stress disorder (PTSD), depression and anxiety. Dr Sowden asserted that Ms Benham’s mental health condition is severe and provided some detail to support that conclusion; she did not provide any comment on the permanence of the condition. Ms Benham said that she is now securing additional evidence relating to her back condition, and now that she knows what is required she expects to be able to present a persuasive case to the tribunal at second review.

14. Ms Benham’s argument then, is that she has strong prospects of success in her substantive application; and that, given the hardship imposed by the cancellation of her DSP, a stay should be granted.

    THE SECRETARY’S ARGUMENTS

15. The Secretary’s submission argued that there is nothing in Ms Benham’s case to warrant a departure from the general rule that decisions should be allowed to have effect. Ms Benham’s case for DSP is not strong, having been rejected twice already on review. The evidence does not support a higher rating than that awarded by the tribunal at first review. In particular, a higher severity rating under the table dealing with mental health is not justified given that Ms Benham has undertaken considerable international travel in the past 18 months.

16. The Secretary further argued that there was no risk of the review being rendered nugatory if the stay were not granted, as Ms Benham would receive arrears if successful at second review but would be able to make a new application if unsuccessful.  If the stay were granted, Ms Benham would receive DSP payments which the Secretary would then be obliged to recover if Ms Benham were unsuccessful; that recovery would in all probability be slow and administratively demanding. Ms Benham claims to be in financial hardship, but she would be in even greater hardship if she were granted a stay and were then unsuccessful, and obliged to support herself and her daughter without the DSP and with the added burden of a debt for overpayment. The public interest also weighs against the grant of a stay when the entitlement of Ms Benham to public funds in the form of DSP has not been established.

17. At the hearing Ms Inglis conceded that on the basis of additional information received, the Secretary now accepted that Ms Benham’s application was stronger than at first appreciated. The Department had referred her record to the Health Professional Advisory Unit (HPAU), a body within the Department that assesses applicants against the medical criteria in the Social Security Act.

    CONSIDERATION

18. The default outcome set by subsection 41(1) of the AAT Act is that a decision has application once made: an application for review does not stop the decision under review from operating. The power to grant a stay in tribunal proceedings is similar to that available to the courts. In Secretary, Department of Families, Housing, Community Services and Indigenous Affairs v Mouratidis [2010] FCA 880 the Federal Court stated, in respect of an application for a stay under subsection 44A(2) of the AAT Act, that the discretion to grant a stay should only be exercised in an applicant’s favour “where special circumstances justify departure from the rule that a successful litigant is entitled to the fruits of judgment pending the appeal, because the appeal, although successful, may otherwise be rendered nugatory” (at [20]).

19. That statement also draws attention to the requirement in subsection 41(2) of the AAT Act that the basis for granting a stay is “for the purpose of securing the effectiveness of the hearing and determination of the application for review” (see also Kurukkal and Minister for Immigration and Multicultural and Indigenous Affairs [2004] AATA 146 at [34]). In coming to a decision, the tribunal is obliged to consider whether a stay is “desirable” after taking into account the interests of those who would be affected by the review.

20. The leading case on applications for a stay where payments are involved is Repatriation Commission and Delkou [1985] AATA 297 (Delkou), where the tribunal (Deputy President Hall) noted that the tribunal had on some occasions granted a stay where a social security benefit had been cancelled and in the absence of a stay the applicant would otherwise face serious financial hardship: see for example Dart and Director-General of Social Services (1982) 4 ALD 553 (Dart). In the latter case the President (Davies J) noted that the facts advanced by the applicant, if accepted, would lead to the applicant succeeding; the applicant had not had a chance to put those facts forward at a previous hearing. Other matters taken into account in similar cases include the prejudice that might be occasioned to either party or to others who might be affected by the review; whether any overpayment is likely to be recoverable by the Commonwealth; whether the public interest favours a stay; and whether a stay or the absence of a stay may render the hearing nugatory (see for example Secretary, Department of Employment and Workplace Relations and Anastasiadis [2007] AATA 1065) (Anastasiadis).

    Prospects of success

21. It is well established that it is not to be expected that the tribunal, in the context of a stay application, will undertake some form of preliminary hearing of the matter: Dart at 555. Nevertheless, whether the applicant’s case is generally strong or weak may well weigh in favour of or against the grant of a stay.

22. In this instance Ms Benham has undertaken the assembly of relevant material to support her case, to the point where at first review the tribunal accepted that her conditions were permanent, and the Secretary has now referred her file to the HPAU, suggesting that it has more substance. Nevertheless, on the material available to me it is not apparent that the case is certain to succeed. Decisions on DSP are driven by a series of factual findings relating to permanence and severity. Minds may differ on such matters. Different decision-makers, on the same facts, can come to different conclusions. Ms Benham may have assumed that, the tribunal having determined that her conditions were permanent at first review, that question is therefore decided; but that is not the case. At second review the tribunal will make a fresh decision, including on questions of permanence as well as on questions of severity.

23. The Secretary has pointed out that records suggest that Ms Benham has in the past 18 months undertaken considerable international travel. International travel is notoriously stressful, and it might suggest that Ms Benham’s mental health is not as fragile as the evidence might otherwise indicate. Ms Benham acknowledged that her boyfriend was in the United States and that she had travelled there and also to New Caledonia. She challenged the detail of some of the other absences, suggesting that some of them were physically impossible as they occurred on dates very close to each other. Dr Sowden suggested that the presence of Ms Benham’s boyfriend in the US made travel there a less threatening experience for her.

24. This is an aspect of the review where facts are at issue and yet to be determined. I do not see it as appropriate to attempt to find the facts at this stage. I am disregarding them in determining Ms Benham’s stay application and they can be taken into account in the review when it proceeds.

25. Overall, the outcome of the review is therefore uncertain, which means that the prospects of success do not weigh significantly in favour of granting the stay.

    Prejudice to the parties and the recovery of overpayments

26. The Secretary argued that there would be prejudice arising from an uncertain recovery of funds if Ms Benham’s application were unsuccessful and a stay had allowed an overpayment. I note, however, that Ms Benham’s only income is in the form of social security and family assistance. That would allow the recovery of the debt in small amounts over time. The period over which recovery would take place might be long, but it is highly likely that ultimately recovery would be completed. The Secretary pointed to Delkou in support of the proposition that recovery at law was not guaranteed, but that case was under repatriation legislation in which particular legal considerations applied, considerations that are irrelevant in the present instance because of the overpayments and debt recovery provisions in Chapter 5 of the Social Security Act: see the arguments on this point in Anastasiadis at [22]-[26].

27. I cannot see that there is substantial prejudice to the Secretary if a stay were granted, although I note that if arrears were to be paid since the payment was first cancelled there would be a far more substantial debt if Ms Benham were to be unsuccessful in her review application.

    Financial hardship

28. Ms Benham has put forward information regarding her financial situation, substantiating to some degree her claim of hardship, although she has not completed a statement of financial circumstances, the form used by the Department to assess financial hardship. I note, in particular, that Ms Benham states that her financial circumstances may limit her ability to obtain from her treating medical practitioners the medical evidence she needs to support her case. That goes to the wording of subsection 41(2) regarding securing the effectiveness of the hearing and the determination of the review. If Ms Benham is inhibited in presenting her case because of the reduction in her income, it would certainly have an influence on the effectiveness of the review.

29. I note, too that Ms Benham is affected by a mental health condition that may in any case make it more difficult than it might be for another person to prepare for her review. She said at the hearing that she is unable to receive newstart allowance because her medical conditions are permanent rather than temporary; but I do not accept that assertion, and Ms Inglis also appeared to accept that Ms Benham would be able to access newstart.

    Public interest

30. The Secretary submitted that payments are made from public funds only to those who are entitled to receive them. This is a reasonable point and weighs against the grant of a stay.

    Whether the review will be rendered nugatory

31. No persuasive argument has been advanced that the appeal will be rendered nugatory, nor is any such possibility apparent to me beyond the risk referred to above if Ms Brenham is inhibited in gathering medical information to support her case.

    CONCLUSION

32. Taking all the above into account, I am of the view that Ms Benham’s capacity to prepare for and participate in the review will be facilitated by a stay that applies to ongoing payments, but does not extend to the arrears since cancellation. Ongoing payments of DSP are to be paid from the next day on which social security benefits are paid. In the interests of ensuring that Ms Benham’s entitlements are settled quickly, I have requested that a hearing on this matter be expedited to the extent that the tribunal’s resources permit.

I certify that the preceding 32 (thirty-two) paragraphs are a true copy of the reasons for the decision herein of Member Mark Hyman

........................................................................

Associate

Dated: 15 October 2018

Date(s) of hearing:	2 October 2018
Applicant:	By telephone
Solicitors for the Respondent:	Ms Charlie Inglis, Department of Human Services