Bornecrantz and Secretary, Department of Social Services (Social services second review)
[2015] AATA 814
•20 October 2015
Bornecrantz and Secretary, Department of Social Services (Social services second review) [2015] AATA 814 (20 October 2015)
Division
GENERAL DIVISION
File Number(s)
2015/0997
Re
Leiv Bornecrantz
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Professor R Deutsch, Deputy President
Date 20 October 2015 Place Sydney The decision under review is affirmed
........................................................................
Professor R Deutsch, Deputy President
CATCHWORDS
SOCIAL SECURITY – pensions – age pension – cancellation of age pension – assets test – whether applicant satisfied the asset test – decision affirmed
LEGISLATION
Social Security Act 1991 (Cth)
CASES
Bogaards v McMahon & Anor (1988) 15 ALD 314
Comcare Australia v Grimes & Anor (1994) 33 ALD 548
Re Bornecrantz and the Secretary, Department of Social Services [2014] AATA 327
Re Cooper (WH) and Repatriation Commission (1995) 38 ALD 164Re Michael and the Secretary, Department of Employment, Science and Training and Edwards and Sec, Department of Health and Ageing [2006] AATA 227
REASONS FOR DECISION
Professor R Deutsch, Deputy President
20 October 2015
INTRODUCTION
The Current Proceedings
The background to the current proceedings relates to a decision made by Centrelink on 28 July 2014 to cancel the Applicants age pension on the ground that he failed the assets test in the Social Security Act 1991 (Cth) (the Social Security Act).
That decision was affirmed on 26 August 2014 by an Authorised Review Officer (ARO) who is an independent officer authorised to review decisions made by Centrelink.
On 16 February 2015 the Social Security Appeals Tribunal (SSAT) affirmed the decision of the ARO.
The Applicant now appeals to this Tribunal seeking a review of the decision made by the SSAT.
Reasons the Applicant’s age pension was cancelled
As mentioned above the reason the Applicant’s age pension was cancelled was because he failed the assets test in the Social Security Act.
His assets had been calculated to be $1,332,721 based on the following figures:
(a)ANZ bank account – Mr Bornecrantz $500
(b)Westpac bank account – Mrs Bornecrantz $100
(c)Loan to Hasso Pty Ltd – Mr Bornecrantz $46,545
(d)Loan to Hanbury Investments Pty Ltd – Mrs Bornecrantz $197,879
(e)Loan to Hanbury Investments Pty Ltd – Mr Bornecrantz $534,030
(f)House contents $5,000
(g)(g) Hanbury’s assets – 90% attributed to Mr and Mrs Bornecrantz $548,667
TOTAL $1,332,721
The asset limit to receive the age pension for a partnered homeowner as at 28 July 2014 was $1,134,000: T13.
As the combined assets exceeded the asset limit, the Applicant would not be entitled to age pension as at 28 July 2014.
The Previous Proceedings
In earlier proceedings the Applicant’s rate of age pension was reduced and that decision was affirmed by the SSAT and by this Tribunal, with this Tribunal making one important variation by reducing from 50% to 45% the amount of the assets of Hanbury attributed to the Applicant. This case was reported as ReBornecrantz and the Secretary, Department of Social Services [2014] AATA 327
A number of issues were decided upon by Deputy President Handley in that decision and some of those issues are sought to be re-ventilated in these proceedings
CONSIDERATION
It is not entirely clear from the plethora of material that has been provided to this Tribunal by the Applicant as to what precisely are the arguments being put by the Applicant to support the view that the decision reached by the Respondent was not the correct and preferable decision.
Having worked through the correspondence it appears to be the case that the Applicant is raising four substantive issues as follows:
·Issue 1 – whether the assessable amounts that are reflected above are properly included and calculated especially in relation to the three loans and the attribution of the Hanbury assets?
·Issue 2 – whether Mr and Mrs Bornecrantz were properly treated as a couple for the purposes of the Social Security Act?
·Issue 3 – whether Mrs Bornecrantz should be attributed with 45% of Hanbury’s assets?
·Issue 4 – whether the Social Security Act is illegal as it contravenes the UN Universal Declaration of Human Rights, international law and certain treaties and whether the Social Security Act is faulty due to single people getting more than married people?
ISSUE 1 – whether the assessable amounts that are reflected above are properly included and calculated especially in relation to the three loans and the attribution of the Hanbury assets?
In relation to the two loan amounts taken to be loans made by Mr and Mrs Bornecrantz to Hanbury, these were amounts referred to as “Private Loans” and “Directors Loans” in the Balance Sheet dated 30 December 2013. The Balance Sheet itself says nothing further about these matters and the Applicant was given the opportunity to provide further information to this Tribunal about these matters in response to the Tribunal’s directions made on 12 May 2015. There appears to be no further information provided in this regard by the Applicant.
The only directly relevant reference of any note to the question of these loans was provided by the applicant to Centrelink in a letter dated 25 April 2015 which states:
Now, take careful note:
THERE ARE NO OFFICIAL LENDING BY MR BORNECRANTZ
If Centrelink want to waste more time on wrong calculations, that would be an important item to consider!
Exactly what message this brief statement conveys is unclear but while it may be the case that there was no “official lending” that is of no consequence to the legal position which clearly is that whether it was official or not, there were loans in place which were made by the Applicant and Mrs Bornecrantz in circumstances where those loans are each assets belonging to the lenders and which have a value equal to the outstanding principal unless contrary evidence is provided.
In the absence of such contrary evidence, these loans are assets that count in accordance with part 3.18 of the Social Security Act.
In this context, it is important to note that the Applicant asserted in his letter to this Tribunal dated to 2 March 2015 (page 1): “I have repeatedly said and written that Hanbury Investments Pty LT D is no longer trading, it is in liquidation”.
This claim was repeated in a further letter this time addressed to Centrelink and dated 25 April 2015 where on page three the Applicant again referred to the “liquidation of the Company” and in an email to this Tribunal dated 23 May 2015 the Applicant asserts that: “the Company is so dormant that it is hardly breathing”.
The fact is however that arising from searches carried out on 2 June 2015 on the Australian Securities and investment Commission’s database it very much appears to be the case that both Hanbury and Hasso are not in liquidation and are at least as at 2 June 2015 registered companies for the purposes of Australian Corporations Law.
It is not clear to me whether the Applicant clearly understands what is meant legally by a company in liquidation but certainly there is no evidence that has been presented to either this Tribunal or to the SSAT which would suggest that the Applicant’s assertion that Hanbury is in liquidation is valid. It may well be that it is not trading and that information would not be forthcoming from an ASIC search. However, even if it were no longer trading that does not automatically mean that the value of the loans in question have diminished.
No tangible evidence has been provided at any time to suggest that the value of the loans have in fact diminished to any extent.
By way of conclusion I would emphasise that this Tribunal can only decide matters based on evidence which is presented to it. On the basis of the lack of any tangible evidence, it is clear that the loans to both Hanbury and Hasso remain extant and the fact that the Applicant and Mrs Bornecrantz are the lenders referred to appears to be uncontradicted. Further, there is no evidence that the loans are in any way impaired in any meaningful way such that they could not be recovered to the full extent of the outstanding amounts.
The Applicant has been given a number of opportunities to provide evidence to the contrary but it does not appear to be the case that any such evidence has been forthcoming.
In relation to the value attributed to the Hanbury assets, the Applicant double counted. In particular this is said to arise because of an argument that if the loans count as assets of the Applicant and Mrs Bornecrantz they should go to reduce the value of the Hanbury assets.
This matter was comprehensively dealt with by Deputy President Handley in the previous proceedings where it was concluded that Mrs Bornecrantz’s loan to Hanbury in particular was not an arm’s length transaction and having regard to the relevant statutory provisions and the formulation of the relevant principles it was concluded that the Tribunal could not be satisfied the loans should be taken into account in reducing the value of Hanbury’s assets.
Even though the Applicant is not seeking a review of the previous decision, there have been a number of comments made by this Tribunal to the effect that the Tribunal should act with extreme caution before reconsidering a matter which has already been decided: ReMichael and the Secretary, Department of Employment, Science and Training and Edwards and Sec, Department of Health and Ageing [2006] AATA 227; Bogaards v McMahon & Anor (1988) 15 ALD 314 ALR 342; Comcare Australia v Grimes & Anor (1994) 33 ALD 548; Re,Cooper (WH) and Repatriation Commission (1995) 38 ALD 164.
In these circumstances, having regard to these numerous authorities, it would be wholly inappropriate and undesirable for this Tribunal to reconsider the issue which has been ventilated and decided upon in the previous decision of this Tribunal.
Accordingly having regard to the fact that the previous decision was concluded on the basis that the loans in question were not arm’s length, the loans cannot operate to reduce the value of the Hanbury assets by virtue of the operation of the existing law.
ISSUE 2 – whether Mr and Mrs Bornecrantz were properly treated as a couple for the purposes of the Social Security Act?
The Applicant asserts that he and Mrs Bornecrantz should have been treated on the basis that they were not members of a couple for the purposes of the Social Security Act.
There is however no evidence whatsoever to support this contention apart from the Applicant’s own statements asserting this to be the case.
If the suggestion is to be taken seriously, the Applicant would need to provide to the Respondent tangible evidence that they are not living as a couple. The best evidence is evidence that demonstrates that they live at separate addresses but in some cases something less might be adequate.
In this case however no evidence whatsoever has been proffered and accordingly the Applicants and Mrs Bornecrantz’s assets must continue to be pooled.
ISSUE 3 – whether Mrs Bornecrantz should be attributed with 45% of Hanbury’s assets?
The Applicant appears to be suggesting that the findings and conclusions made by Deputy President Handley in the previous proceedings did not amount to a finding or a conclusion that Mrs Bornecrantz is to be attributed with 45% of the value of the Hanbury assets. He suggests that any such inference from that decision was in any event purely obiter dicta and that Centrelink misunderstood the decision. (Letter to the AAT dated 2 March 2014 and letter to SSAT dated 2 December 2014).
I am not sure in what sense the Applicant is suggesting that these findings and conclusions were somehow obiter dicta as they were fairly clearly directly relevant to the final decision and in that sense there is no basis for such a suggestion
Accordingly, this matter has already been determined on a previous occasion and it is not appropriate to re-open the same issue for reconsideration now under the guise of a fresh application.
Issue 4 – whether the Social Security Act is illegal as it contravenes the UN Universal Declaration of Human Rights, international law and certain treaties?
The Applicant makes statements of this nature in much of the correspondence but it is not clear whether these are intended to be formal submissions or merely off-hand statements intended to confuse or possibly to intimidate the recipient: Letter of 9 May 2015 to the Registrar AAT. I assume from the content of that email that the Applicant is suggesting that the Social Security Act may contravene either or both of Articles 25 and 30 of the UN Declaration of Human Rights.
If it is intended to put such an argument as a submission for consideration, this Tribunal is clearly not an appropriate form to ventilate such issues as they concern matters of international law obligations which need to be pursued before a Federal court of law, in all likelihood the Federal Court but quite possibly the High Court. This Tribunal has no jurisdiction to hear such matters.
DECISION
For the reasons mentioned above the decision under review is affirmed.
I certify that the preceding 38 (thirty -eight) paragraphs are a true copy of the reasons for the decision herein of Professor R Deutsch, Deputy President
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Associate
Dated 20 October 2015
Date(s) of hearing On the Papers, 29 June 2015 Applicant Mr Bornecrantz Solicitors for the Respondent Sparke Helmore
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