Bofilios and Secretary, Department of Social Services (Social services second review)
[2021] AATA 4050
•27 October 2021
Bofilios and Secretary, Department of Social Services (Social services second review) [2021] AATA 4050 (27 October 2021)
Division:GENERAL DIVISION
File Number(s): 2020/8039
Re:Michael Bofilios
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
DECISION
Tribunal:Member Durkin
Date:27 October 2021
Place:Adelaide
The decision under review is set aside and substituted with a decision that Mr Bofilios is not to be treated as a member of a couple for the purposes of the Social Security Act 1991 (Cth) and that he should continue to receive the single rate of the Disability Support Pension (DSP) Blind backdated to the time from which it was changed to the partnered rate.
...........................[Sgnd]..............................
Member Durkin
Catchwords
SOCIAL SECURITY – whether Applicant member of a couple – Applicant received payments of disability support pension (DSP) blind at partnered rate – whether Applicant entitled to single rate of DSP blind – whether a special reason exists not to treat the Applicant as a member of a couple – decision under review set aside
Legislation
Social Security Act 1991 (Cth), ss 4(3), 24
Cases
Boskoski and Secretary of the Department of Social Services (2014) AATA 915
Staunton-Smith v Secretary, Department of Social Security [1991] FCA 513
Secondary Materials
Explanatory Memorandum to the Social Security Legislation Amendment Bill (No 4) 1991
REASONS FOR DECISION
Member Durkin
27 October 2021
The Applicant, Mr Bofilios, and Ms Malykhina share premises at 37 Harmanis Street, Wanguri in the Northern Territory, which property is being purchased by Mr Bofilios by means of a mortgage.
The Application for Review, of 7 December 2020, before this Tribunal seeks review of a decision that Mr Bofilios and Ms Malykhina are part of a couple for the purposes of the Social Security Act 1991(Cth) (the Act).
Mr Bofilios and Ms Malykhina have cohabitated since approximately 10 September 2019 and share a child (Child A) who is currently 1 year of age.
Mr Bofilios is legally blind and, until the events in question described below in this decision, he was paid a Disability Support Pension (Blind) (DSP Blind) at the “single” rate.
Preparatory to the birth of their child, Mr Bofilios and Ms Malykhina presented at the Centrelink Office in Casuarina in the Northern Territory on 5 November 2019.
The original decision record prepared by the officer of the Department of Social Services who met with them records information including that Ms Malykhina was working up until close to the birth of their child. The original decision record also revealed that Ms Malykhina was not eligible for any Centrelink benefit on account of her being on a bridging visa.
The Applicant made a complaint to this Tribunal at Tier 1 review (AAT1), and again before the Tribunal at Tier 2 review (AAT2), that the material in the ODR of 5 November 2019 included “fabrication”.
On that day, Ms Malykhina completed a Form “Authorising a person or organisation to enquire or act on your behalf”. Mr Bofilios made a complaint at both AAT1 and AAT2 that this document had not been read to him and that he did not endorse its contents. Of significance, however, for present purposes in that document is that, in answer to question eleven, Ms Malykhina has described the person being nominated, Mr Bofilios, in terms of his relationship with her, as her “partner”. This of course does not necessarily make Mr Bofilios and Ms Malykhina “partners”, and the significance is largely confined to the fact that at the time of completing the form that appears to be the view Ms Malykhina had of her relationship with Mr Bofilios.
In the course of their relationship with Centrelink at this time, both Mr Bofilios and Ms Malykhina completed an SS284 form regarding “relationship details”. Ms Malykhina completed such document on 21 January 2020, and the form completed by Mr Bofilios is not dated. It is convenient at this time to note what each have recorded in those documents which were clearly part of the evidence before the Centrelink officer who, on 25 February 2020, determined that the Applicant was a member of a couple with Ms Malykhina.
In answer to question six, Ms Malykhina has described her relationship with Mr Bofilios as one of “girlfriend/boyfriend”. On his own form Mr Bofilios records similarly. She advises that they began to share accommodation at the address at Harmanis Street from 31 August 2019. Nothing of significance turns on the varying accounts of the commencement date of their cohabitation.
Ms Malykhina describes in the document that her previous lease was ending, and she was expecting a child. In answer to question fifteen she said that she did not know how long she intended to share accommodation with Mr Bofilios, advising “didn’t plan so far”.
She advises in that document she did not own the home she currently lived in and stated that she did not know who did own it. She further stated she did not pay for council rates or water rates and did not know whether there was a continuing mortgage. Importantly, she states in regard to question twenty-two that she does not pay any board or rent for her accommodation. She and Mr Bofilios did not share any real estate assets.
She advises that the reason she does not pay for her accommodation is that:
“Michael Bofilios invited me to live in the house”.
She advises that she and Mr Bofilios “sometimes” eat together at mealtimes and that “sometimes” they would prepare meals for each other. She advised that her purpose for doing this was:
“to show him my national food”.
She confirms that they share the kitchen but advised that she had her own washing machine. In his own evidence before the Tribunal at AAT2, Mr Bofilios confirmed that both he and Ms Malykhina owned their own fridges and washing machines.
She advises that they share a bedroom although she also had a separate bedroom in the house for her own use. In practicality, and largely on account of the weather, Ms Malykhina shared Mr Bofilios’ bedroom as does their child.
In answer to question thirty-six, she confirms that she has a sexual relationship with Mr Bofilios and, to the inquiry as to whether Mr Bofilios would be free to form a sexual relationship with “other people”, Ms Malykhina advised that he would “but if he does I will stop talking to him”.
In the form Ms Malykhina further confirms that she and Mr Bofilios holidayed once together to Europe and once to Tasmania. She confessed to not knowing whether relatives, friends or regular associates consider her and Mr Bofilios to be partnered.
She confirms that they are invited out as a couple though “rarely”, citing Christmas and some birthdays.
She confirms further that she and Mr Bofilios share social and leisure activities such as movies and family events. In the form she advises that she has no access to Mr Bofilios’ credit card or bank account and nor does he have any access to hers. She advised that she pays for her own mobile phone and internet expenses but that she does not know who pays for the electricity in the shared premises.
From question fifty-six, she advises that both she and Mr Bofilios pay for their own food and housekeeping items and that household tasks are performed by each person “as required” although Mr Bofilios’ was in her view responsible for any gardening or maintenance.
She advises in the form that they do not share any private medical insurance or any other insurance policy, nor is Mr Bofilios nominated as beneficiary in any Will, superannuation account or life insurance policy of hers.
Question seventy of the form asks Ms Malykhina how her relationship differs from that of a married, registered, or de facto couple and advises that:
“Our relationship is not registered. We do not own anything together, don’t share our finances, don’t interfere in each other’s personal businesses if not asked by the other party”.
In his own SS284 Form, Mr Bofilios confirms that he and Ms Malykhina share accommodation at the Harmanis Street address, although he nominates a different date for the commencement of the cohabitation.
He advises that they began sharing accommodation because Ms Malykhina was pregnant and that the duration of their cohabitation was a matter that they were “taking day by day”. He advises that he owns the home in which they are living and he is responsible for council rates and water rates and that there is a continuing mortgage. He confirms Ms Malykhina‘s account that he and she do not share any real estate, assets or shared private medical insurance, insurance policies, superannuation or life insurance. He advises though, that Ms Malykhina is nominated as a beneficiary under his Will.
As to shared kitchen preparations Mr Bofilios advises that there was no formal arrangement and specifically advised that Ms Malykhina had her own fridge.
He confirms that they share a bedroom largely because his bedroom has an air conditioner. He confirms they have a sexual relationship though advises that he considered that he was free to form a sexual relationship with people other than Ms Malykhina.
He denied providing any care or practical support to Ms Malykhina in respect of any personal crisis, money matters, or family disputes. He confirms an “overseas trip in 2018” but expressed doubt whether relatives, friends, or regular associates consider he and Ms Malykhina to be partnered.
He confirms that they had been invited out as a couple in the past, specifically to his niece’s birthday party. He professes in answer to question forty-five that he does not know Ms Malykhina‘s employment status. This Tribunal is somewhat sceptical of that assertion.
He confirms they do not share any bank accounts or credit facility and that Ms Malykhina is responsible for her own internet and mobile phone costs. He confirms that he is responsible for the payment of the electricity costs of the premises which they share. The answer to question sixty-five confirms that Ms Malykhina and Mr Bofilios’ son, Child A, was two weeks old at the time that he completed this form.
As to how his relationship with Ms Malykhina differs from that of a married, registered, or de facto couple he stated that:
“No formal arrangements. No share assets or finances. Not responsible for each other’s debts or damages and decisions”.
The Department, having determined on 25 February 2020 that Mr Bofilios and Ms Malykhina were members of a couple, proposed to commence paying Mr Bofilios the DSP (Blind) on the basis he was a member of a couple. Mr Bofilios sought internal review of that determination and the Authorised Review Officer (ARO), on 22 April 2020, confirmed the Department’s decision. The ARO varied the Department’s decision that Mr Bofilios and Ms Malykhina were members of a couple and varied the payment to Mr Bofilios at the partnered rate of the DSP (Blind) to be from 5 March 2020.
Mr Bofilios sought review of the determination of the ARO to this Tribunal and the matter came on for hearing before Member Rieper, who made a decision on that Application for Review dated 16 November 2020. Mr Bofilios complained before this Tribunal at AAT2 that he had been denied procedural fairness at AAT1 and had been prevented from providing Member Rieper with certain information apparently on account of the shortness of time allocated to the hearing. This Tribunal is confident that Mr Bofilios was given every opportunity to put forward before the Tribunal all documentation, statements, and other oral evidence that he wished to in pursuit of his Application for Review.
Before AAT1 Mr Bofilios confirmed that he was meeting all costs for his son and for Ms Malykhina “as she was not working and not entitled to Centrelink benefits because of her visa status”. It will be recalled that Mr Bofilios had advised in his SS284 form that he did not then know Ms Malykhina’s employment status
It is also noted that, in a letter to Review Officer C J Healy dated 23 March 2020, the Applicant stated:
“I am meeting all costs for my son [Child A] and his mother who was not working and is not entitled to Centrelink benefits because of her visa status”.
That characteristic of their circumstances is stated consistently through the material before this Tribunal.
Before Member Rieper on 16 November 2020 the Applicant gave evidence that:
“I do not believe that we are a member of a couple because we have never agreed to be a member of a couple”.[1]
[1] Page 8 – Transcript
It is clear that whether or not Mr Bofilios and Ms Malykhina are a couple is not a matter of whether they have agreed to be a couple. The task at all times under the Act is to consider the objective facts of any relationship and determine whether they can be said to be a ‘couple’.[2]
[2] Boskoski and Secretary of the Department of Social Services (2014) AATA 915
Section 4(3) of the Act provides guidance to the decision maker as to the appropriate way to assess known facts to determine whether two people are members of a “couple” for the purposes of receipt of benefits pursuant to the Act:
“(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)(ii), 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 de facto relationship.”
Broadly speaking section 4(3) enjoins the decision maker to consider the financial aspects of the relationship, the nature of the household, social aspects of the relationship, the question of any sexual relationship, and the nature of the parties’ apparent commitment to each other. Before AAT1 Mr Bofilios confirmed that he and Ms Malykhina remained cohabitating at Harmanis Street and that she was not paying rent. Given that she is apparently not working and not in receipt of any Centrelink benefit it appears to be the case, though Mr Bofilios at some point had sought to withdraw such a statement, that he met all of Ms Malykhina‘s costs including electricity and water supply to their shared accommodation. When pressed by the Tribunal to explain why he was meeting all of the accommodation and utilities expenses of Ms Malykhina if they were not a couple, Mr Bofilios gave an example of persons who may for a time “house-sit” for another person. The Tribunal was not persuaded by this attempt at explanation.
In financial terms they do not have any joint ownership of real estate or major assets and do not appear to pool any financial resources as, on the evidence before the Tribunal, Ms Malykhina does not have any such assets of substance.
In terms of the nature of their household they have been cohabitating for approximately two years at the time of the writing of this decision and Ms Malykhina and their child share Mr Bofilios’ bedroom. In terms of the social aspects of their relationship both parties identified in their “relationship details” forms that they regard themselves as “boyfriend/girlfriend” and confirmed that they were invited out from time to time as a couple although this was said to be “rarely”. It is noted they have shared overseas and domestic travel.
Both parties admit to a continuing sexual relationship. As was noted by the Federal Court in the matter of Staunton-Smith v Secretary, Department of Social Security:[3]
“...no tribunal is required, in every case, to compile something in the nature of a checklist and then to proceed slavishly to comment on each item in the list. The personal circumstances of people varies substantially. The responsibility of the Tribunal is to extract from the evidence and other material that is before it those items of information that are properly classified as material to its deliberations.”
[3] 1991 FCA 513
Taking all of the material before this Tribunal into account, inclusive of the extensive written material provided by Mr Bofilios, this Tribunal agrees with the determination of the Department of 25 February 2020 that the Applicant is part of a couple with Ms Malykhina as confirmed by the ARO and by this Tribunal at AAT1.
But that is not the end of the matter. The matters which propelled Member Rieper at AAT1 to conclude that Mr Bofilios and Ms Malykhina were part of a couple, were also persuasive to this Tribunal. The Department put before this Tribunal the Secretary’s Statement of Facts, Issues and Contentions which included, from paragraph 96, a submission that, should the Tribunal conclude that Mr Bofilios and Ms Malykhina were part of a couple, then it ought to further consider whether there is a “special reason” not to treat Mr Bofilios as a member of a couple.
Section 24 of the Act provides guidance as to this:
“Person may not be treated as not being a member of a couple (subsection 4(2))
(1) Where:
(a) a person is legally married to another person; and
(b) the person is not living separately and apart from the other person on a permanent or indefinite basis; and
(c) the Secretary is satisfied that the person should, for a special reason in the particular case, not be treated as a member of a couple;
the Secretary may determine, in writing, that the person is not to be treated as a member of a couple for the purposes of this Act.
(1A) If:
(a) a relationship between a person and another person (whether of the same sex or a different sex) is registered under a law of a State of Territory prescribed for the purposes of section 2E of the Acts Interpretation Act 1901 as a kind of relationship prescribed for the purposes of that section; and
(b) the person is not living separately and apart from the other person on a permanent or indefinite basis; and
(c) the Secretary is satisfied that the person should, for a special reason in the particular case, not be treated as a member of a couple;
the Secretary may determine, in writing, that the person is not to be treated as a member of a couple for the purposes of this Act.
(2) Where:
(a) a person has a relationship with another person, whether of the same sex or a different sex (the partner); and
(b) the person is not legally married to the partner; and
(c) the relationship between the person and the partner is a de facto relationship; and
(d) the Secretary is satisfied that the person should, for a special reason in the particular case, not be treated as a member of a couple;
the Secretary may determine, in writing, that the person is not to be treated as a member of a couple for the purposes of this Act.
(3) A determination made under subsection (1), (1A) or (2) is not a legislative instrument.”
This Tribunal does identify a “special reason” why Mr Bofilios should not be treated as a part of a couple with Ms Malykhina. The term “special reason” is not defined in the Act and the Secretary concedes in paragraph 98 of its Statement of Facts, Issues and Contentions that the section 24 discretion though “not lightly to be enlivened”, “does not require that the case be extremely unusual, uncommon or exceptional”.
In paragraph 100 of its Statement of Facts, Issues and Contentions the Secretary pointed to the Explanatory Memorandum to the Social Security Legislation Amendment Bill (No 4) 1991 and particularly that:
“... there is justification in paying a higher rate to an unpartnered person than to a member of a couple if both members of the couple are living together. This justification is based on the premise that the unpartnered person does not enjoy the economies of shared living costs as does a member of a couple in those circumstances. If the economies of scale are not available to the member of the couple because, for example, of the illness of one or both members of the couple, then each would face similar living costs as an unpartnered person”.
In the present circumstances where, on account of child rearing obligations, Ms Malykhina does not work, and in circumstances where her visa status makes her ineligible for receipt of any Centrelink benefit, and in circumstances where, in consequence, Mr Bofilios is responsible for the overwhelming burden of the costs of their relationship including the costs of their accommodation and the utilities supplied to it, a special reason does arise to treat Mr Bofilios not as a member of a couple for the purpose of the Act.
Accordingly the decision under review is set aside and a determination made that Mr Bofilios is not to be treated as member of a couple for the purposes Act and that he should continue to receive the single rate of the DSP (Blind) backdated to the time from which it was changed to the partnered rate.
I certify that the preceding fifty (50) paragraphs are a true copy of the reasons for the decision herein of Member Durkin.
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Legal Administrative Assistant
Dated: 27 October 2021
Date of hearing: 15 June 2021 Applicant:
Self-Represented
Advocate for the Respondent: Riley Calaby
Services Australia
Key Legal Topics
Areas of Law
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Administrative Law
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Statutory Interpretation
Legal Concepts
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Judicial Review
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Procedural Fairness
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Statutory Construction
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Appeal
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