Bolewski and Secretary, Department of Social Services (Social services second review)
[2016] AATA 959
•29 November 2016
Bolewski and Secretary, Department of Social Services (Social services second review) [2016] AATA 959 (29 November 2016)
Division
GENERAL DIVISION
File Number
2016/3024
Re
Kathy Bolewski
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
Decision
Tribunal Mr S. Webb, Member
Date 29 November 2016 Place Canberra The decision under review is set side. It is appropriate to treat $25,000 of Ms Bolewski’s compensation payment as not having been paid in the special circumstances of her case. The matter is remitted to the Secretary to calculate Ms Bolewski’s entitlements.
..............[sgd]..........................................................
Mr S. Webb, Member
CATCHWORDS
SOCIAL SECURITY – disability support pension – compensation for injury – lump sum compensation – deduction of legal costs – recovery of compensation affected payments made during lump sum preclusion period – alleged deficiencies in legal advice – agreement to fixed legal costs before settlement – ignorance of Centrelink recovery amount at time of settlement – special circumstances – decision set aside
LEGISLATION
Social Security Act 1991, ss 17, 1168, 1169, 1170, 1184K
CASES
Fuller and Secretary, Department of Family and Community Services [2004] AATA 615
Secretary, Department of Employment and Workplace Relations v Homewood [2006] FCA 779
Secretary, Department of Family & Community Services v Sammut [1999] FCA 1735 Secretary, Department of Family & Community Services v Allan [2001] FCA 1160
Secretary, Department of Social Services and VYS (1995) 40 ALD 475
Secretary, Department of Social Services v Cunneen [1997] FCA 1033
Tisdell and Secretary, Department of Social Services [2015] AATA 582
REASONS FOR DECISION
Mr S. Webb, Member
29 November 2016
Kathy Bolewski was in receipt of Disability Support Pension (DSP). She obtained an offer of casual employment but fell and injured her left foot before she could commence duties. She claimed and was paid compensation in a lump sum settlement. A delegate of the Secretary determined that a lump sum preclusion period applied. As Ms Bolewski was paid DSP during the preclusion period, an amount was recovered from her compensation settlement sum. She is not happy with this result and has pressed her rights of review, so far without success. She applied for further review by the Tribunal.
Facts
On 2 January 2013, Ms Bolewski was offered casual employment as a Community Care Employee by Uniting Care Aging, Western Region.[1]
[1] Exhibit 1.
On 10 January 2013, she tripped on broken concrete in the car port of the house she was renting and injured her foot.
On 14 October 2013, Dr Gliksman, an occupational physician, provided a medico-legal report.[2]
[2] Exhibit 2.
In or about April 2014, Ms Bolewski says she signed a costs agreement with her retained solicitor, Philip Day of Denniston and Day Lawyers. She could not remember the date and she does not have a copy of the document. She says that she did not understand the agreement, but knew that it was for a fixed amount.
On 22 September 2014, Mr Day filed a Statement of Particulars[3] and a Statement of Claim[4] in the District Court of New South Wales in respect of Ms Bolewski’s injury, namely –
1. Damages pursuant to the Civil Liability Act 2002 as amended
2. Interest thereon pursuant to s.83 of the District Court Act 1973 as amended
3. Costs. [5]
[3] T8.
[4] T16 folios 79 to 82.
[5] Ibid, folio 79.
On 2 July 2015, Dr Gliksman provided a further medico-legal report.[6]
[6] Exhibit 2.
On 18 December 2015, settlement terms were agreed, including a lump sum payment of $160,000 inclusive of costs, disbursements and interest.[7] The terms were finalised in a Consent Judgement signed by each of the parties.[8] As can be seen, Ms Bolewski agreed to indemnify the Defendants in any proceedings for recovery of monies “pursuant to any social services legislation”.[9]
[7] T11 folio 60.
[8] T15 folios 71 to 73.
[9] Ibid, folio 72.
It is important to note the undated authority to settle document Ms Bolewski signed, which sets out legal costs and disbursements, totalling $69,922.99, past benefits from Medicare amounting to $5,255.30 and other matters. On this document and her own evidence, it appears that Ms Bolewski knew that Centrelink would recover an amount from her compensation lump sum settlement, but she was not informed of the amount –
I understand that a Centrelink clearance must be obtained prior to the insurance company disbursing the money. I confirm I have been receiving Centrelink benefits and I have claimed economic loss in this matter and there will be an amount refundable to Centrelink but confirm that you do not know what that amount will be until the matter has settled and a request is sent to Centrelink with a copy of the terms of settlement. I understand the insurance company will deduct whatever amount is owing to Centrelink prior to disbursing monies to you.[10]
[10] T24.
On 22 December 2015, Ms Bolewski’s solicitor wrote a letter to Centrelink, enclosing a copy of the consent judgement and advice of lump sum payment, and said –
We request you advise us of any Centrelink payback figure and preclusion period, if any, as soon as possible.[11]
[11] T12 folio 69.
On 25 January 2016, Centrelink issued a Compensation Recovery Notice specifying that $35,699.64 would be recovered from W R Berkeley Insurance Australia, “being the amount of recoverable Centrelink payments received by Kathy Bolewski from 10 January 2013 to 20 August 2014”.[12]
[12] T17 folio 84.
That same day, Centrelink sent a notice of decision, setting out the recovery amount and the preclusion period.[13]
[13] T19.
Ms Bolewski requested review of this decision.
On 11 March 2016, an Authorised Review Officer, decided to affirm the decision.[14]
[14] T21.
On 19 April 2016, Ms Bolewski provided a Statement of Financial Circumstances.[15]
[15] T22.
On 22 April 2016, she provided a budget she had calculated with assistance from the Samaritans Newcastle/Hunter Valley.[16]
[16] T23 folio 106.
On 31 May 2016, the Social Services and Child Support Division of this Tribunal decided to affirm the decision.[17]
[17] T2.
On 9 June 2016, Ms Bolewski applied for further review.[18]
[18] T1.
Issues
In a case of this kind, it is necessary to answer the following questions –
(a)Did Ms Bolewski receive a compensation affected payment for the purposes of s 1169(1)(a) of the Social Security Act 1991 (the Act)?
(b)Did she receive a lump sum compensation payment for the purposes of s 1169(1)(b)?
(c)If so, what is the compensation part of the lump sum compensation payment calculated under s 17(3))?
(d)What is the length of the preclusion period calculated using the formula prescribed in s 1170?
(e)What is the “recoverable amount” under s 1184A?
(f)Are there special circumstances that make it appropriate to treat all or part of the compensation payment as not having been made?
Compensation affected payment
There is no dispute that Ms Bolewski received ongoing DSP payments from the date of her injury on 10 January 2013 to the present.
Under s 17(1), a “compensation affected payment” is defined to include a DSP payment.
It follows that Ms Bolewski received compensation affected payments.
Lump sum compensation payment
The term “lump sum compensation payment” is not given any special meaning under the Act, although s 17(4A) provides guidance to what it is not –
(4A) For the purposes of this Act, a payment of arrears of periodic compensation payments is not a lump sum compensation payment.
Section 1169 bars payment of a “compensation affected payment” to a person who receives a “lump sum compensation payment”, and this section also provides some guidance about the meaning of a “lump sum compensation payment” –
1169 Compensation affected payment not payable during lump sum preclusion period
(1) If:
(a) a person receives or claims a compensation affected payment; and
(b) the person receives a lump sum compensation payment;
the compensation affected payment is not payable to the person in relation to any day or days in the lump sum preclusion period.
(2) In this section:
lump sum compensation payment does not include a lump sum payment:
(a) to which section 1164 applies; or
(b) that relates only to arrears of periodic compensation payments.
The word “compensation” is broadly defined in s 17(2) –
(2) Subject to subsection (2B), for the purposes of this Act, compensation means:
(a) a payment of damages; or
(b) a payment under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or
(c) a payment (with or without admission of liability) in settlement of a claim for damages or a claim under such an insurance scheme; or
(d) any other compensation or damages payment;
(whether the payment is in the form of a lump sum or in the form of a series of periodic payments and whether it is made within or outside Australia) that is made wholly or partly in respect of lost earnings or lost capacity to earn resulting from personal injury.
Thus, subject to the exclusions provided by s 17(4A) and s 1169(2), and noting the terms of s 1171 (which are not presently applicable), a payment of compensation that is within the terms of s 17(2), which includes an amount for lost earnings or lost capacity to earn, will be treated as a ‘lump sum compensation payment’.
There is no dispute that Ms Bolewski’s lump sum settlement amount of $160,000 included an unspecified amount for lost earnings. In the Statement of Particulars this aspect of her claim was specified as “work of 25-30 hours casually per week” at the rate of “$21.00 per hour”.[19] While not expressly stated, it is quite clear that the claim was made in respect of past and future lost earnings or lost capacity to earn consequent to injury, as well as other damages.
[19] T8, folio 53.
On long established authority,[20] it is not appropriate to disaggregate a lump sum payment into component parts in order to exclude elements of the whole. Addressing this point in Fuller and Secretary, Department of Family and Community Services,[21] Downes J said –
Once a component is included in the lump sum it does not matter whether it relates to non economic loss compensation, to costs, or to anything else. It is its quality as part of the lump sum not how it is characterised which matters. All that is required is that part of the sum relates to economic loss.
[20] Secretary, Department of Social Security v Cunneen [1997] FCA 1033.
[21] [2004] AATA 615 at [11].
The ‘lump sum compensation payment’ is $160,000. That being so, the whole of the $160,000 lump sum settlement payment is taken to be a “lump sum compensation payment” for the purposes of the Act.
Compensation part of lump sum and preclusion period
The compensation part of the lump sum compensation payment is worked out under s 17(3) –
Compensation part of a lump sum
(3) Subject to subsection (4), for the purposes of this Act, the compensation part of a lump sum compensation payment is:
(a) 50% of the payment if the following circumstances apply:
(i) the payment is made (either with or without admission of liability) in settlement of a claim that is, in whole or in part, related to a disease, injury or condition; and
(ii) the claim was settled, either by consent judgment being entered in respect of the settlement or otherwise; or
(ab) 50% of the payment if the following circumstances apply:
(i) the payment represents that part of a person’s entitlement to periodic compensation payments that the person has chosen to receive in the form of a lump sum; and
(ii) the entitlement to periodic compensation payments arose from the settlement (either with or without admission of liability) of a claim that is, in whole or in part, related to a disease, injury or condition; and
(iii) the claim was settled, either by consent judgment being entered in respect of the settlement or otherwise; or
(b) if those circumstances do not apply—so much of the payment as is, in the Secretary’s opinion, in respect of lost earnings or lost capacity to earn, or both.
Under s 17(3)(a), the compensation part of the lump sum compensation payment Ms Bolewski received is $80,000.
Preclusion period
The duration of the lump sum preclusion period is to be worked out using the formula in s 1170 –
1170 Lump sum preclusion period
(1) Subject to subsection (2), if a person receives both periodic compensation payments and a lump sum compensation payment, the lump sum preclusion period is the period that:
(a) begins on the day following the last day of the periodic payments period or, where there is more than one periodic payments period, the day following the last day of the last periodic payments period; and
(b) ends at the end of the number of weeks worked out under subsections (4) and (5).
(2) If a person chooses to receive part of an entitlement to periodic compensation payments in the form of a lump sum, the lump sum preclusion period is the period that:
(a) begins on the first day on which the person’s periodic compensation payment is a reduced payment because of that choice; and
(b) ends at the end of the number of weeks worked out under subsections (4) and (5).
(3) If neither of subsections (1) and (2) applies, the lump sum preclusion period is the period that:
(a) begins on the day on which the loss of earnings or loss of capacity to earn began; and
(b) ends at the end of the number of weeks worked out under subsections (4) and (5).
(4) The number of weeks in the lump sum preclusion period in relation to a person is the number worked out using the formula:
(5) If the number worked out under subsection (4) is not a whole number, the number is to be rounded down to the nearest whole number.
For the purposes of s 1170(4), the “income cut-out amount”, as defined in s 17(1), is to be worked out applying the formula set out in s 17(8) –
(8) For the purposes of the definition of income cut-out amount in subsection (1), the formula is as follows:
where:
energy supplement component means the energy supplement worked out under point 1064-C3 for a person who is not a member of a couple:
(a) whether or not the person for whom the income cut-out amount is being worked out is a member of a couple; and
(b) whether or not that point applies to the person for whom the income cut-out amount is being worked out.
maximum basic rate means the amount specified in column 3 of item 1 of the table in point 1064-B1.
ordinary free area limit means the amount specified in column 3 of item 1 of the table in point 1064-E4.
pension supplement component means the pension supplement amount worked out under point 1064-BA3 for a person who is not a member of a couple:
(a) whether or not the person for whom the income cut-out amount is being worked out is a member of a couple; and
(b) whether or not that point applies to the person for whom the income cut-out amount is being worked out.
Applying these provisions as of the date on which Ms Bolewski settled her claim, 18 December 2015, the income cut-out amount is $948.
Dividing the compensation part of the lump sum compensation payment ($80,000) by this amount results in 84 weeks (rounded down under s 1170(5)).
I should point out that this amount does not reflect the amount that Ms Bolewski might have actually earned each week had she not been injured. It is an amount calculated by reference to the elements specified in s 17(8).
The next element to be determined is when the preclusion period commences. Presently, there is no evidence that Ms Bolewski received periodic payments, or that she elected to receive periodic payments as a lump sum. It follows that s 1170(3) applies.
There is some uncertainty about the date on which Ms Bolewski first lost earnings as a result of her left foot injury. She was to be employed as a casual employee and her days and hours of work are not readily apparent on the present materials. Nevertheless, the 2 January 2013 letter of offer of employment Ms Bolewski was sent by her then prospective employer, Uniting Care Aging Western Region, states – “You will commence employment with us on 15 January 2013”.[22]
[22] Exhibit 1.
I will proceed on the basis that 15 January 2013 was the day on which her loss of earnings began. This is the date on which the lump sum preclusion period commences. It ends 84 weeks later, on 20 August 2014.
Recoverable amount
The “recoverable amount” is determined under s 1184A.
In the circumstances of this case, where recovery was made from W R Berkeley Insurance Australia, s 1184A(d)(ii) provides that the recoverable amount is that specified in the notice issued under s 1184.
The amount specified is $35,699.64.[23]
[23] T17 folio 84.
Special circumstances
Ms Bolewski has raised a number of circumstances that are, in her submission, special circumstances sufficient to upset Centrelink’s recovery. Her submissions on this point may be conveniently grouped into three areas: legal and cost issues; health issues; and financial issues.
The Secretary asserts that none of these matters raise special circumstances that render it appropriate to treat any part of the compensation she received as not being paid.
The assessment of special circumstances arises in respect of the discretion conferred by s 1184K –
1184K Secretary may disregard some payments
(1) For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:
(a) not having been made; or
(b) not liable to be made;
if the Secretary thinks it is appropriate to do so in the special circumstances of the case.
(2) If:
(a) a person or a person’s partner receives or claims a compensation affected payment; and
(b) the person receives compensation; and
(c) the set of circumstances that gave rise to the claim for compensation is not related to the set of circumstances that gave rise to the person’s or the person’s partner’s receipt of, or claim for, the compensation affected payment;
the fact that those 2 sets of circumstances are unrelated does not alone constitute special circumstances for the purposes of subsection (1).
The term “special circumstances” in this context has been discussed many times in authoritative cases.[24] It refers to circumstances that are unusual, out of the ordinary or exceptional, or where something unfair, unjust or unintended has occurred in the particular case. Thus, special circumstance considerations require an examination of the particular circumstances of the individual as well as consideration, more generally, of circumstances of others who may be subject to relevant provisions of the Act.
[24] See, for example, Secretary, Department of Family & Community Services v Sammut [1999] FCA 1735; Secretary, Department of Family & Community Services v Allan [2001] FCA 1160.
Legal and cost issues
Ms Bolewski argues that the legal advice she was given was unsatisfactory and deficient. She has complained to the Legal Services Commission about it, but this did not result in a satisfactory outcome.
She argues that the amount of legal costs and disbursements deducted by her lawyer, $69,922.99, was excessive - $49,500 for Dennison and Day professional costs; $16,500 for counsel’s fees; and $3,922.99 for disbursements.
She maintains that she was not properly informed about the amount of Centrelink’s recovery before entering into settlement terms. Once the Medicare charge was applied and Centrelink’s recovery was deducted, she received only $49,000 approximately of the $160,000 settlement.
She says that she used this amount to pay out debts, namely a car loan of approximately $6,000; a loan from her eldest son of $4,000; a loan from her eldest daughter of $9,000; a credit card debt of $4,000 and an SEC bill of $3,500. She also used it to purchase furniture and household items when she moved into her present residence. In March 2016, she had about $6,000 remaining.
By Ms Bolewski’s own account, she entered into a fixed costs agreement with her lawyers in April 2014. I note the Legal Services Commissioner’s remarks on this point.[25] It appears that the amounts deducted from her lump sum compensation payment for legal costs and disbursements were largely consistent with the costs agreement (which is not in evidence). I do not think that, now, it is open for her to argue that the amount agreed is so unduly high that it can amount to a special circumstance.
[25] Exhibit 2, Office of legal Services Commissioner letter, 8 July 2016.
On Ms Bolewski’s evidence, her lawyer did not provide her with a satisfactory or reasonable estimate of the amount that Centrelink could recover – she understood that it would be a small amount. I accept her evidence that the advice she was given prior to that event was vague and imprecise, but sufficient to raise her expectation that the recovery would not be a large proportion of the overall settlement amount – she says she was told the amount would be “not much”.
It is quite clear that Ms Bolewski’s lawyer did not obtain an estimate of the recoverable amount prior to agreement of terms in settlement of her compensation claim. In consequence, Ms Bolewski was in the position of proceeding to settle her claim without being fully apprised of the likely amount that would be recovered from the settlement amount.
Whether this late action by her lawyer to obtain a reasonable estimate of the recoverable amount before settling on an overall sum is, itself, actionable by Ms Bolewski is not for me to determine. And that is only one consideration. In view of her various ailments, especially her deteriorating mental health, and the absence of financial resources or capacity to earn, it is highly doubtful that she would have the capacity or the resources to commence action of that kind. Furthermore, Ms Bolewski told me that she has only very limited education and she did not understand the legal advice she was given over the telephone by her lawyer – she maintains that she did not have any face to face meeting with her solicitor or counsel engaged to represent her.
Generally, it might be expected that difficulties between a lawyer and a client should be resolved using the available mechanisms within the legal services arrangements of the particular jurisdiction. Remedies may lie open in the courts, for example, and it would not generally be acceptable for taxpayers to meet the financial detriment flowing from defective legal advice in a particular case. One does not have to look hard or far to find such cases.
This notwithstanding, in circumstances such as Ms Bolewski’s, s 1184K may provide some leeway or flexibility to address what otherwise would lie between her and her lawyer. She has attempted to obtain relief from the Legal Services Commission, without success. Once again, one does not have to look hard to find cases of similar kind, where the fault of a lawyer has caused unfairness and financial detriment to a claimant, and this has been accepted as a ‘special circumstance’ for the purposes of s 1184K.[26]
[26] See Re Tisdell and Secretary, Department of Social Services [2015] AATA 582; Re Secretary, Department of Social Security and VYS (1995) 40 ALD 745, for example.
The policy underlying the compensation recovery provisions must also be considered, as these provisions apply to many people with the intention of preventing a person from receiving income support from taxpayers as well as from another source at the same time.
Ms Bolewski clearly expected that she would have to repay an amount to Centrelink. It is the size of the amount that surprised her.
To my mind, the failure of her lawyer to obtain information about the recoverable amount from Centrelink, or to provide a reasonable estimate of that amount to Ms Bolewski, prior to settlement of her compensation claims is a special circumstance in her case. Had she been armed with such knowledge, she would have had opportunity to take this into account when deciding to settle upon terms. Absent this, she proceeded to settlement on an incorrect assumption from which, presently, she is unlikely to be able to recover.
Health issues
The medical evidence before the Tribunal establishes that Ms Bolewski has ongoing issues with her left foot as a result of her injury, and these may well worsen with age and the advance of arthritic disease. She is due to have an operation for a bunion that has been made worse by the injury, and is presently awaiting an appointment with a surgeon as a public patient. The materials are sufficient to establish that this is anticipated within the next few months.
Dr Gliksman identified conditions affecting Ms Bolewski’s feet, including “severe left hallux valgus, likely accelerated by the injury” in his report on 2 July 2015,[27] prior to settlement of her compensation claims.
[27] Exhibit 2, report 2 July 2015, page 3.
It is reasonable to expect that the compensation settlement amount Ms Bolewski agreed to accept made some provision for future medical expenses. These circumstances, alone, are not special.
Ms Bolewski told me that she has increasing pain from arthritis in her arm, which was badly injured when she was a child.
I note that Ms Bolewski has mental health issues relating to anxiety and depression.[28]
[28] Exhibit 3, referral letter by Dr Khan, 2 September 2016.
It is an unfortunate fact that people who receive DSP share one characteristic in common – they all suffer from impairments that adversely affect their functional capacity. Ms Bolewski’s ailments and their effects do not amount to special circumstances that set her case apart from others – many are those in similar circumstances of advancing age, worsening impairments and increasing incapacity for work.
Financial issues
Ms Bolewski told me that she is making ends meet, but that she has to juggle payments when they fall due as she has no spare capacity or financial resources. Her difficult financial situation is reinforced by incapacity and her inability to earn money in employment.
I have carefully examined her financial records, including her credit card liabilities and her assets. I accept that her financial circumstances are straitened and she is unable to put money by to meet future health or treatment costs.
As for the manner in which she expended the part of the lump sum settlement she received, it strikes me that she could have arranged to repay her debts in instalments and, thereby, she could have preserved a greater part of the lump sum she received to meet her future expenses. Nonetheless, these were choices she made, and she has explained her reasoning for doing so.
Many are those who rely on social security payments as their sole source of income, and who struggle to make ends meet financially as a result. These are difficult times and, unfortunately, circumstances of this kind are more common than they are exceptional or unusual amongst those who obtain income support through the social security system.
Ms Bolewski argues that she should be recognised and treated as an individual. And she is right. But it does not follow that the circumstances in which she finds herself, and the difficult health and financial issues she experiences, and her incapacity, made worse by injury and advancing arthritic disease, are “special circumstances” for present purposes.
Exercise of discretion
The lump sum compensation payment on which Ms Bolewski agreed to settle her claim for damages results in an 84-week preclusion period, from 15 January 2013 to 20 August 2014, during which she was not entitled to be paid DSP.
She was aware that an amount would be recovered by Centrelink from her compensation settlement amount. But this does not damage her case in respect of special circumstance considerations. Ms Bolewski was not informed of the amount Centrelink would recover from her lump sum compensation payment on settlement of her claim until after agreement had been reached. She should have been provided with that information by her lawyer before settlement terms were finalised. It is unlikely that Ms Bolewski would be in a position to bring an action against her former lawyer, or that her complaint is actionable, with any reasonable prospect that she might recover, even if she could.
In the usual course, estimates are of recoverable amounts are sought from Centrelink ahead of settlement to avoid exactly the difficulty that has landed on Ms Bolewski. As I have said, this amounts to a special circumstance in her case.
The next step is to determine whether it is appropriate to exercise discretion conferred by s 1184K to treat part of the compensation as not having been paid.
The cost of the failure of Ms Bolewski’s lawyer lies against her, and she has but few resources to deal with it – she has poor physical and mental health, no financial reserves and very little education. She is struggling to make ends meet and cannot work. She fears that she will be unable to meet the cost of future medical treatment. In these circumstances, I think that it is appropriate to exercise discretion to treat part of her compensation amount as not having been made.
The legislation is silent on the method for reducing the amount of compensation to be applied when calculating the lump sum preclusion period in the special circumstances of any case. Whatever method is adopted by a decision-maker, to my mind, it should be consistent with the purposes of s 1184K and characterised by rationality,[29] such that it can readily be understood.[30]
[29] Secretary, Department of Family and Community Services v Allan [2001] FCA 1160 at [19].
[30] Secretary, Department of Employment and Workplace Relations v Homewood [2006] FCA 779 at [34].
Clearly enough, the purpose of s 1184K is to provide relief from the operation of compensation preclusion provisions if special circumstances exist that render it appropriate to do so. It may be appropriate to exercise the discretion, in a case of this kind, where the person has not been provided with information necessary to make a properly informed decision, and the resulting decision has a detrimental effect on the person’s ability to meet necessary medical treatment and other expenses.
The amount of $35,699,64 is the total amount of DSP Ms Bolewski was paid during the preclusion period that resulted from the statutory formulae. Ms Bolewski says that she expected the recoverable amount would be less than $5,000 to $10,000. On this assessment, she received $25,000 to $30,000 less than she was led to believe she would be paid.
There is not sufficient evidence presently to accurately assess Ms Bolewski’s future medical treatment expenses and her capacity to cover such costs. I note that she may be able to access medical treatment, including surgical treatment, through the public system, and this will go some way to mitigate the detriment she has suffered as a result of the failing of her lawyer and deduction of the recoverable amount, in full, from her compensation settlement. I accept, nevertheless, that in her circumstances, with deteriorating medical conditions and the onset of mental health problems, with few financial resources or assets and struggling to make ends meet, some provision to cover likely medical treatment costs in the future is desirable.
Weighing up these considerations, I am reasonably satisfied that it is appropriate to reduce the amount of compensation by $25,000, being the approximate difference between the amount Ms Bolewski was told Centrelink might recover from her compensation settlement (up to $10,000) and the amount that was actually recovered ($35,699.64). This will have the effect of contracting the duration of the applicable lump sum preclusion period, with a resulting back payment to Ms Bolewski. These matters will be remitted to the Secretary to determine.
Decision
The decision under review is set side. It is appropriate to treat $25,000 of Ms Bolewski’s compensation payment as not having been paid in the special circumstances of her case. The matter is remitted to the Secretary to calculate Ms Bolewski’s entitlements.
I certify that the preceding 81 (eighty -one) paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member ................[sgd]........................................................
Associate
Dated 29 November 2016
Date of hearing 27 October 2016 Applicant In person Solicitors for the Respondent Department of Human Services
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