Carrick and Repatriation Commission

[2004] AATA 270

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 270

ADMINISTRATIVE APPEALS TRIBUNAL          Nº V2003/484

VETERANS'      AFFAIRS       DIVISION

Re:       GRAHAM JAMES CARRICK AND

VIRGINIA ANN CARRICK

Applicants

And:     REPATRIATION COMMISSION

Respondent

DECISION

Tribunal:       Mr E. Fice, Member

Date:             16 March 2004

Place:            Melbourne

Decision:The Tribunal does not have jurisdiction to review the decision made by the Repatriation Commission.

(sgd) E. Fice

Member

VETERANS' AFFAIRS - jurisdiction - service pension - overpayment correctly raised - conversion of United States pension amounts into Australian dollars for calculating Australian pension rate - whether any onus lies with respondent

Administrative Appeals Tribunal Act1975   

Veterans' Entitlements Act 1986 ss 54, 56B, 56H, 57, 127, 175, 205, 206

Re Deason and Repatriation Commission (1991) 23 ALD 637

Re Knight and Repatriation Commission (AAT 9115, 12 November 1993)

Re Lobik and Repatriation Commission (1995) 42 ALD 331

Re Hildebrand and Repatriation Commission (1996) 42 ALD 133

Re Porritt and Repatriation Commission (AAT 11137, 3 June 1996)

Re Collector of Customs (New South Wales) v Brian Lawlor Automotive Pty Ltd

(1979) 2 ALD 1

REASONS FOR DECISION

16 March 2004  Mr E. Fice, Member

1. Mr and Mrs Carrick have been paid service pension since 28 September 1995.  They each received a letter, dated 29 January 2003, from the Commonwealth Department of Veterans' Affairs (the Department) informing them that their service pension had been overpaid.  Consequently they were each required to repay the sum of $12,562.14.  The letters notifying Mr and Mrs Carrick of the overpayments also stated that they could apply for a review of the decision if they lodged an application within three months of being notified of the decision. 

2. Mr Carrick wrote a letter to the respondent on 10 February 2003, seeking a review of the decision.

3. Under the cover of a letter dated 24 March 2003, a delegate of the Repatriation Commission wrote to Mr and Mrs Carrick informing them that he had conducted a review but, regrettably, had decided to affirm the decision made by the first delegate.  Written reasons for the affirmation were provided to Mr and Mrs Carrick.

4. Mr and Mrs Carrick are dissatisfied with the decision made by the Repatriation Commission's delegate on 24 March 2003 and seek to have it reviewed by this Tribunal.

5. At the hearing of this matter, Mr and Mrs Carrick were represented by Mr J. Jackson, an advocate from the Returned & Services League, and the Repatriation Commission was represented by its advocate, Mr R. Douglass.

BACKGROUND

1. Following the death of his first wife in 1978, Mr Carrick, while holidaying in the United States of America (USA, United States), met his current wife, Virginia.  Following his return to Australia, he arranged for Virginia to travel to Australia and they were married in Melbourne in 1979. 

2. In 1984, Mr and Mrs Carrick moved to California, USA, where they resided for some 11 years.  While there, Mr Carrick applied for and was granted a "Green Card" enabling him to work.  After a period of time, he became entitled to a United States social security pension, which he duly received.  Mrs Carrick became entitled to a United States disability pension, which she duly received.

3. Mr and Mrs Carrick returned to Australia in 1995 to live.  Upon their return, they applied for and were each granted a service pension commencing on 28 September 1995.  In making that application, Mr and Mrs Carrick disclosed their United States pensions and they provided the Department with their 1994 group certificate details setting out the level of social security pensions received.  However, unknown to the Department, the United States pensions had been increased by 2.8 per cent in January 1995.  This fact was not disclosed to the Department by Mr and Mrs Carrick. 

4. On numerous occasions, commencing 3 November 1995, the Department sent letters to Mr and Mrs Carrick advising them of a change in their pension assessment for various reasons. Included in each of those letters was a statement that the advice was issued under either s 127 of the Veterans' Entitlements Act 1986 (the Act) or, later, under s 54 of the Act. In essence, the letters required Mr and Mrs Carrick to inform the Department within a specified period of time of any changes in their circumstances which might alter the rate of pension to which they were entitled. The letter also cautioned them that failure to disclose any change in circumstances may result in an overpayment and that, under the Act, the Repatriation Commission was entitled to recover the overpayment.

5. Mr and Mrs Carrick failed to notify the Department of annual cost of living adjustments made to their United States pensions. 

6. On 29 January 2003, a delegate of the Repatriation Commission discovered an overpayment of the pensions paid to Mr and Mrs Carrick and notified them that there had been a combined overpayment of $24,098.18.

7. The only recorded advice provided by Mr and Mrs Carrick regarding their United States pensions was received by the Department on 31 August 1999 from their financial advisor.  The amounts of their pensions were given in Australian dollars and there was nothing in the advice that alerted the Department to any alteration in the rate of United States pensions.

8. Mr and Mrs Carrick said that they relied upon their accountant to provide notice of any variation in their United States pensions.  They admitted that they had never specifically requested their accountant to do so. 

9. On 13 June 1996, Mr Carrick advised the Department that compulsory Federal income tax was being deducted from Mrs Carrick's United States pension.  Mr Carrick provided a letter in which the new payment details were set out.  The Department adjusted Mr and Mrs Carrick's Australian pensions accordingly but later realised that this was an error, as the gross amount of pension derived from the USA should have formed the basis for its calculation.  Accordingly, the Department waived any overpayment between 20 June 1996 and January 1997. 

10. Following representations made by Mr and Mrs Carrick's accountant, Mr Bruce McInnes, a delegate of the Repatriation Commission, extended the waiver period in respect of the overpayments from 20 June 1996 to 18 June 1998.  This was because the notices sent to Mr and Mrs Carrick throughout that overpayment period did not stipulate that it was the gross amount of their United States' pensions that should be declared.  Accordingly, the delegate determined that Mr and Mrs Carrick should not be penalised for their failure to notify the Repatriation Commission of the gross amount of pension received from the USA.  Further adjustments were made throughout the overpayment period after a re‑examination of exchange rates during that period.  The consequence of all these adjustments is that the total overpayment amount, in respect of each pension is now $9467.01.

CONTENTIONS

1. At the hearing, Mr Carrick did not dispute the fact that an overpayment had occurred.  Furthermore, he did not dispute the amount of overpayment calculated by the Repatriation Commission, nor did he dispute any calculations made by the Repatriation Commission in converting the United States pension amounts into Australian dollars for the purposes of calculating the Australian pension rate entitlement.

2. The only contention advanced on behalf of Mr and Mrs Carrick at the hearing was that repayment of the debt would cause him and his wife considerable financial difficulty.  Mr Jackson submitted that Mr Carrick and his wife suffer from poor health and that Mrs Carrick has been assessed as requiring full‑time residential care, which will need to be funded.  He said that the suddenness of this matter and the demand for full reimbursement has caused them stress and anxiety.  Mr and Mrs Carrick said they could not afford to repay the entire amount in question.

3. Other than written submissions, no evidence was led on behalf of Mr and Mrs Carrick regarding their financial position or their stated inability to repay the overpayment amount.

4. The Repatriation Commission submitted that there are two means of raising an overpayment where the rate of service pension that has been paid is higher than that permitted under the Act: it may reduce the service pension by making a determination under sub‑s 56D(1) of the Act or, alternatively, it may rely on provisions contained in s 56B, where an automatic rate reduction is supplied in particular circumstances.

5. The Repatriation Commission submitted that the Tribunal does not have jurisdiction to review automatic rate reduction under s 56B of the Act due to the operation of s 57 and s 175(2) of the Act.

6. Alternatively, the Repatriation Commission submitted that any determination that it had made regarding recovery or waiver of an overpayment, pursuant to s 205 or s 206 of the Act, is not reviewable under s 57 of the Act and, therefore, not open to review by the Tribunal.

DETERMINATION

1. In its letter dated 29 January 2003, a Departmental delegate advised Mr and Mrs Carrick only that their service pension had been overpaid and that the overpayment had to be repaid by refunding the amount of the overpayment to the Receiver of Public Moneys.  At no time did Mr and Mrs Carrick dispute the fact that an overpayment had occurred.  In fact, Mr and Mrs Carrick said that they relied on their accountant, Mr McInnes, to advise the Department of their changed circumstances in respect of the United States pensions.  In evidence, Mr Carrick admitted that he did not expressly give Mr McInnes those instructions, but expected Mr McInnes to make that disclosure.

2. Mr Carrick, who gave evidence on behalf of Mrs Carrick and himself, said that he did not dispute the amount of overpayment calculated by the Repatriation Commission.  Nor did he dispute any of the calculations made by the Repatriation Commission in converting the United States pension amounts into Australian dollars for the purpose of calculating the entitlement to the Australian pensions.  

3. Following Mr Carrick's request for a review of the decision of the first delegate of the Repatriation Commission, a second delegate purported to review that decision under s 57 of the Act.

4. However, I am unable to find anything in s 57 which entitles a pensioner, dissatisfied with a decision of the Repatriation Commission that overpayments of pension have been made and that they should be repaid, to seek review of that decision. The only provision which it could be argued is relevant is s 57(2)(c), which provides:

   (2)          A pensioner who is dissatisfied with a decision of the Commission:

   (a)…

   (b)…

   (c)reducing or increasing the rate of a service pension or income support supplement; or

   (d)…

   (e)…

   may request the Commission to review the decision. 

5. However, it is my view that the decision to recover overpayments of pension already paid is not a decision reducing or increasing the rate of a service pension or income support supplement.  There are a number of decisions to that effect by this Tribunal.  In Re Deason and Repatriation Commission (1991) 23 ALD 637, at 647, Deputy President Johnston, when dealing with s 59(1)(b) of the Act, which, for these purposes, is practically the same as s 57(2) of the current Act, said:

   …The Tribunal, reading s 59 (1) (b) in its plain meaning has difficulty with that view.  It does not easily see [sic] that the determination of an overpayment necessarily has any of the effects set forth in that provision.  …

6. In Re Knight and Repatriation Commission (AAT 9115, 12 November 1993), Deputy President McMahon, when dealing with an identical situation regarding an overpayment of a service pension, said:

   …There is certainly no jurisdiction to review a decision to waive any part of the overpayment.  In my view there is no jurisdiction to review even whether an overpayment exists.  In the present case, the primary and review decisions go no further than this first step.  Even if one could infer automatic progression to the next steps (and one can not) there would still be no jurisdiction vested in this Tribunal. 

7. In Re Lobik and Repatriation Commission (1995) 42 ALD 331 the Repatriation Commission submitted that the decision that the applicants in that case had been overpaid a service pension and the decision to recover that overpayment from them was not reviewable. Regarding that submission, the Tribunal said: "…The tribunal has no hesitation in accepting the lastmentioned submission".

8. There are two further relevant decisions, Re Hildebrand and Repatriation Commission (1996) 42 ALD 133 and Re Porritt and Repatriation Commission (AAT 11137, 3 June 1996).  In both of those decisions, Senior Member Handley relied particularly on the decisions made in Re Lobik and Re Knight.  He adopted the reasoning set out in Re Knight.

9. If, as I find, the decision of the Repatriation Commission to recover overpayment of service pensions from Mr and Mrs Carrick is not a decision which falls under any of the provisions of s 57 of the Act, then it follows that such a decision is not reviewable by a delegate of the Repatriation Commission. It is unnecessary for me to consider the Repatriation Commission's alternative submissions.

10. The Tribunal's powers of review are set out in s 175(2) of the Act, which provides:

    (2) Where the Commission, under section 57B, affirms a decision of the Commission referred to in section 57 or sets it aside and substitutes another decision for it, a person may apply to the Administrative Appeals Tribunal for a review of the decision so affirmed or substituted.  

11. Although, in this case, the Repatriation Commission has purported to exercise powers under s 57B, affirming a decision of the Repatriation Commission under s 57, as there was no relevant decision under s 57, the second delegate, in my opinion, acted outside the powers conferred by the Act. However, the fact that the second delegate did so, does not exclude his decision from my review (Re Collector of Customs (New South Wales) v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1).

12. Accordingly, I find that the Tribunal does not have jurisdiction to review the decision made by the Repatriation Commission.

I certify that the thirty‑three [33] preceding paragraphs are a true copy of the reasons for the decision herein of

Mr E, Fice, Member

(sgd)     Catherine Thomas
            Clerk

Date of Hearing:                 8 December 2003

Date of Decision:               16 March 2004
Advocate for the applicant:  Mr J. Jackson, Returned & Services League of Australia

Solicitor for respondent:      Mr R. Douglass, Advocacy Section,
  Department of Veterans’ Affairs