Christopher Glenville and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2012] AATA 335

[2012] AATA 335 

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2011/4153
Re	Christopher Glenville
APPLICANT
And	Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
RESPONDENT

DECISION

Tribunal	Senior Member K Bean
Date	5 June 2012
Place	Adelaide

The decision under review is varied such that it is determined that by reason of the existence of "special circumstances" within the meaning of s 1184K of the Social Security Act 1991 (the Act) so much of Mr Glenville's compensation payment is to be treated as not having been made as will result in a preclusion period equivalent to that which would have been applicable if, for the purposes of s 1170 of the Act, the "compensation part" of his lump sum compensation payment had been $1,000,000.

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Senior Member K Bean

CATCHWORDS

SOCIAL SECURITY – Disability Support Pension – Catastrophic injury – Receipt of very large compensation payment – Economic loss component conceded by respondent – Economic loss component far less than 50% of compensation settlement – High future care costs – "Special circumstances" present such that operation of 50% rule should be ameliorated – Preclusion period to be calculated having regard to the true economic loss component of the settlement – Decision under review varied.

LEGISLATION

Social Security Act 1991 (Cth) ss 17(1), (2) (3)(a), (ab) and (b), 1160(1), 1169, 1170, 1171, 1184K.

CASES

Secretary Department of Family and Community Services v Chamberlain (2002) 116 FCR 348

Re Secretary Department of Families, Housing, Community Services and Indigenous Affairs and Horsnell (2009) 110 ALD 443

REASONS FOR DECISION

Senior Member K Bean

5 June 2012

INTRODUCTION

1. The applicant, Mr Glenville, is currently 41 years old.  On 1 January 2002, when he was only 31, he suffered a tragic accident as a result of which he sustained catastrophic injuries including a fracture of the spinal column in his neck.  He has been left a “tetraplegic” as a result of his injuries and he is unable to care for himself.  Needless to say, the consequences of the accident have been devastating for Mr Glenville and his family.

2. In 2004, Mr Glenville commenced proceedings seeking damages for the injuries he suffered in the accident.  In the course of a mediation in those proceedings an agreement was reached on 14 September 2010 pursuant to which the insurer, Allianz, agreed to pay to Mr Glenville a total sum of $10,355,969.60 in two tranches, the first tranche being $5,355,969.60 and the second tranche $5,000,000.00.  It was agreed that the first tranche was to be paid forthwith, but the second tranche should be paid shortly after 13 September 2015, in the event that Mr Glenville survived until that date.  In the event that Mr Glenville did not survive until 13 September 2015, the second tranche would be paid to the Motor Accident Commission.  This agreement was subsequently given effect by a judgment and protection order made by the Supreme Court.[1]

   [1] T3/243.

3. In the context of the matter before me, the parties agreed that the bulk of Mr Glenville’s settlement amount was attributable to his future care costs, whilst $1,000,000 of the settlement amount was attributable to economic loss.

4. Prior to the settlement of his claim, Mr Glenville had been in receipt of Disability Support Pension (DSP).  However on 14 February 2011, the insurer advised Centrelink that his claim had been settled on 11 February 2011[2] for a total lump sum settlement amount of $10,355,969.60.  Mr Glenville was subsequently advised that as a result of this lump sum compensation payment, he was subject to a compensation preclusion period during which he would not be entitled to receive DSP.  The preclusion period was determined to start on 1 January 2002 and end on 7 February 2129.  That preclusion period was calculated having regard to the entirety of the settlement amount, including both the first and second tranches. 

   [2] There was a significant delay between the Heads of Agreement being signed and judgment being entered.

5. On 23 February 2011, Mr Glenville’s representative requested a review of that decision.  However on 23 March 2011, an Authorised Review Officer (ARO) affirmed the decision on the basis that it was appropriate to have regard to the whole of the settlement amount, not only the first tranche, and further that there were no “special circumstances” which justified reduction of the preclusion period. 

6. Mr Glenville subsequently sought review of that decision by the Social Security Appeals Tribunal (SSAT) and on 17 August 2011, the SSAT set aside Centrelink’s decision to impose a preclusion period ending on 7 February 2129.  The SSAT substituted a decision that the total lump sum compensation received by Mr Glenville was the first tranche of $5,355,968.60 only and that the preclusion period must be calculated accordingly.  On the question of “special circumstances”, the SSAT concluded that there were no “special circumstances” within the meaning of s 1184K of the Social Security Act 1991 (Cth) (the Act) which justified reduction of the preclusion period calculated by reference to the first tranche.

7. Before me, the respondent conceded that the SSAT was correct in concluding that Mr Glenville had not “received” the second tranche and therefore the total lump sum compensation to which regard should be had in calculating the preclusion period was the first tranche only.[3]  I also consider the SSAT’s reasoning in this regard to have been correct and therefore that the respondent’s concession was appropriately made.

   [3] Respondent's Statement of Facts, Issues and Contentions, [4.5].

8. Therefore the only issue before me is whether there are “special circumstances” such that Mr Glenville’s compensation preclusion period should be reduced.

9. However, as the broader legislative context has some relevance to that question, before addressing it more directly I propose to first outline the salient aspects of the legislative scheme which gives rise to Mr Glenville’s compensation preclusion period.  

   LEGISLATIVE SCHEME

10. The Act contains a number of provisions directed toward recovery of amounts which have been paid by way of social security payments where the recipient of those payments subsequently receives a lump sum by way of compensation, including an amount attributable to economic loss.  It also contains provisions designed to preclude those who have received compensation for economic loss from receiving social security payments during the period for which they have received compensation.  The principle underlying these provisions is that where a person receives compensation for lost earnings or lost capacity to earn, they should rely on that compensation rather than seek, or be permitted to retain, income support by way of social security payments.

11. Accordingly, in general terms the legislation provides that where a person has received compensation for economic loss, they should exhaust that compensation before being entitled to income support by way of social security payments.  Similarly, where a person receives compensation for economic loss and social security payments in respect of the same period, they should repay the amount they have received in social security payments once they have received their compensation lump sum.

12. In order to achieve this objective, and prevent settlements from being manipulated so as to minimise the amount repayable to Centrelink, the Act relevantly provides that where a person has received a compensation lump sum by way of a settlement which relates partly to lost earnings or lost capacity to earn, half of that amount is treated as compensation for economic loss and described as the “compensation part of a lump sum payment”[4].  A formula is then applied to that amount so as to determine the number of weeks that the recipient could reasonably be expected to support themselves from that component of the lump sum.  The number of weeks arrived at becomes the “preclusion period” during which the compensation recipient is not entitled to receive most social security payments.  Further if they have already received a specified form of social security payment or “compensation affected payment”[5] (which includes DSP) during that period, they are required to repay to Centrelink the amount of the social security payments they have received during the preclusion period.

    [4] s 17(3).

    [5] s 17(1).

13. The preclusion period is calculated by reference to s 1170 of the Act.  Pursuant to that section, the compensation part of the lump sum (i.e. half of the total lump sum received) is divided by the “income cut out amount” to give a number of whole weeks.  The “income cut out amount” is defined in s 17(1) to be:

    “The amount worked out using the formula in sub-section (8), as in force at the time when the compensation was received.”

    That formula is based partly upon the maximum pension rate payable at the time the compensation was received. 

14. Section 1171 also requires that, where more than one lump sum is received in respect of a particular injury and one of the lump sums relates to lost earnings or lost capacity to earn, both lump sums must be taken into account.  It provides as follows:

    “1171 Deemed lump sum payment arising from separate payments

    (1)  If

    (a)   a person receives 2 or more lump sum payments in relation to the same event that gave rise to an entitlement of the person to compensation (the multiple payments); and

    (b)   at least one of the multiple payments is made wholly or partly in respect of lost earnings or lost capacity to earn;

    the following paragraphs have effect for the purposes of this Act and the Administration Act:

    (c)   the person is taken to have received one lump sum compensation payment (the single payment) of an amount equal to the sum of the multiple payments;

    (d)   the single payment is taken to have been received by the person:

    (i)on the day on which he or she received the last of the multiple payments; or

    (ii)if the multiple payments were all received on the same day, on that day.

    (2)A payment is not a lump sum payment for the purposes of paragraph (1)(a) if it relates exclusively to arrears of periodic compensation.”

15. These provisions must, however, be read subject to s 1184K of the Act, which I have referred to above. That section authorises the Secretary (and this Tribunal, standing in the shoes of the Secretary) to disregard the whole or part of a compensation payment in certain circumstances. Section 1184K(1) provides as follows:

    “1184K  Secretary may disregard some payments

    (1)       For the purposes of this Part, the Secretary may treat the whole or part of the 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.

    …”

16. It is against that legislative background therefore that I will proceed to address the question before me, namely whether there are “special circumstances” within the meaning of s 1184K of the Act which justify reducing the preclusion period applicable to Mr Glenville.

    ARE THERE “SPECIAL CIRCUMSTANCES” WHICH MAKE IT APPROPRIATE TO TREAT PART OF MR GLENVILLE’S COMPENSATION PAYMENT AS NOT HAVING BEEN MADE?

    Contentions

17. Mr Britton, who appeared as counsel for Mr Glenville, relied upon a number of matters to establish the existence of “special circumstances” in this case. 

18. Firstly, he relied upon the fact that the figure of $1,000,000 allowed in the settlement for Mr Glenville’s economic loss was a bone fide and accurate amount.  Therefore having regard to the goals of the legislation, it was appropriate to have regard to that amount in determining Mr Glenville’s compensation preclusion period, rather than applying the arbitrary formula known as “the 50% rule”, as required by s 17(3).  He acknowledged certain observations made by Kiefel J in Secretary, Department of Family and Community Services v Chamberlain (2002) 68 ALD 357, to the effect that by its nature s 17(3) is intended to operate in a somewhat arbitrary fashion. Nevertheless, he submitted that it was open and appropriate for the Tribunal to examine the circumstances of each case and intervene where significant unfairness was demonstrated.

19. Mr Britton also relied upon the fact that Mr Glenville had extremely high current and future care needs and the bulk of his settlement needed to be allocated to those expenses.  Further he also pointed out that Mr Glenville had had very high legal costs and that his settlement had been reduced for contributory negligence.  As part of the overall picture, he also relied upon evidence to the effect that Mr Glenville’s funds were currently being eroded at an amount of approximately $94,000 per year, being the amount by which his expenses exceeded his income.[6]  

    [6] Exhibit 3.

20. Mr Parker, who appeared for the respondent, formally conceded that a figure of $1,000,000 did represent Mr Glenville’s true economic loss as a result of his injury.  However he nevertheless submitted that no great unfairness resulted from application of the 50% rule in the circumstances of this case.  He also reiterated the contention made in the respondent’s Statement of Facts, Issues and Contentions, that it was inappropriate for the Tribunal to find “special circumstances” in a case where a person has:

    “sufficient liquid assets to support themselves for the duration of the preclusion period and the person has been advised of the preclusion period and is able to liquidate those assets during preclusion period.”[7]

    [7] Respondent’s Statement of Facts, Issues and Contentions, [4.18].

    Consideration

21. I should indicate at the outset that whilst the catastrophic nature of Mr Glenville’s injuries and the very high amount of his settlement are unusual features of this matter, in my view they are not factors which in and of themselves give rise to the existence of “special circumstances” within the meaning of the legislation.  That is because, of themselves, those matters do not give rise to any particular injustice, unfairness or hardship of the kind necessary to establish “special circumstances”.  Likewise, whilst Mr Glenville’s legal costs of approximately $500,000[8] were extremely high, they were also part of a very large settlement and again, in and of itself, the amount of these costs does not in my view distinguish this matter from the ordinary case such as to support a conclusion that “special circumstances” are present.  Similarly, the fact that the total amount of the settlement was reduced for contributory negligence, whilst by no means irrelevant, would not by itself support the existence of “special circumstances” in the context of an overall settlement of $10,000,000.

    [8] T3/193.

22. However, the fact that the economic loss component of Mr Glenville’s settlement is agreed by the respondent as being $1,000,000, whereas an amount of approximately $2,500,000 has been used to calculate his compensation preclusion period, clearly has the potential to result in a substantial injustice, particularly having regard to Mr Glenville’s extremely high future care needs.  Accordingly, I consider this to be a circumstance worthy of consideration as to whether it constitutes “special circumstances” in the required sense, either by itself or in combination with any of the other matters referred to above.[9]

    [9] See Re Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Horsnell (2009) 110 ALD 443, at [48].

23. In considering that question, I acknowledge Mr Parker’s contention that the legislative scheme is intended to operate in an arbitrary way and clearly contemplates that the 50% rule will be followed in cases where the true economic loss component was far less than 50% of the total settlement.  As Kiefel J observed in Chamberlain:

    “[23] It may generally be accepted that the statutory provisions here in question were intended to operate upon factual bases which were assumed and were not intended to reflect the true position. This is so with respect to the figure of 50% taken of the lump sum compensation payment; the amount of basic rate of pension used to divide it; the period during which double payment is assumed to have occurred; and perhaps even the commencement of the period when the loss of earning capacity arose, which would normally be taken to be the date when the compensable injury was occasioned to the person.

    [24] Unlike a presumption, which may be rebutted by evidence, the purpose and effect of a deeming provision is to prevent any attempt, by either party, to prove the truth: Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1983) 150 CLR 169 at 214 ; 40 ALR 609 at 642 per Murphy J; a facility to put to rest the disputes which would otherwise arise concerning the facts: Macquarie Bank Ltd v Fociri Pty Ltd (1992) 27 NSWLR 203 at 227 ; 7 ASCR 553 at 556 per Kirby P. Whether a provision has this effect is determined principally by having regard to the purpose for which it is used: Macquarie Bank v Fociri at NSWLR 207–8; ASCR 557 per Gleeson CJ; Muller v Dalgety & Co Ltd (1909) 9 CLR 693 ; 16 ALR 17; Rheem Australia Ltd v Collector of Customs (NSW) (1988) 14 ALD 786 ; 78 ALR 285 at 301.

    [25] Here the factual assumptions upon which the calculations are based, including that which treats 50% of the total compensation payment as representing the economic loss component, could not have been intended to be subject to rebuttal in the process of applying the formulae. The statutory purpose is to overcome the need in each case to determine what part of a lump sum compensation payment in truth represents economic loss. Although the assumptions to be made and the result reached are necessarily arbitrary, it is a course which has been taken for administrative simplicity: Secretary, Department of Social Security v Hulls (1991) 22 ALD 570 at 579; Secretary, Department of Social Security v Smith (1991) 30 FCR 56 at 61 ; 23 ALD 277 at 282.”

24. As her Honour also observed however, s 1184K is also part of the overall statutory scheme and can be invoked to ameliorate the harsh or unfair operation of the arbitrary rule. As Kiefel J went on to say in Chamberlain:

    “[26] These observations do not, however, conclude the matter, since s 1184 was inserted to ameliorate the harshness of the arbitrary provisions: Haidar v Secretary, Department of Social Security (1998) 52 ALD 255 at 263 ; 157 ALR 359 at 367 per Hill J. Pursuant to it the decision-maker is entitled to treat the compensation payment, or part of it, as if it had not been made, which is to say in a manner different from that required by the formulae. This is undertaken only if the requisite opinions are formed, namely that “special circumstances” exist and it is considered appropriate to treat the compensation payment such that there will either be no period when double payment is assumed to have been made, or there will be a shorter period.

    [27] The question then is what can be taken into account as a “special circumstance”. The secretary's argument is that the decision-maker can never take into account what was actually received by way of compensation for economic loss in considering the circumstances of the particular case. Counsel for Mrs Chamberlain relies upon two decisions of this court in support of an argument that one may have regard to the true facts of a case: Kertland v Secretary, Department of Family Services (1999) 95 FCR 64 ; 57 ALD 600 and Secretary, Department of Social Security v Smith, referred to above. In each case it was held that there was no error in the tribunal's view that special circumstances existed.

    [28] In Smith (at FCR 61–2; ALD 282) an argument was advanced for the secretary that the circumstances of a case should be confined to matters which arise externally to the operation of the scheme. Von Doussa J summarised it as follows:

    ‘It is contended on the appellant's behalf that “the circumstances of the case” should be confined to matters which arise external to the operation of the scheme. An example of such a matter given in argument is where the payment by way of compensation is not received by the plaintiff because of a defalcation by an agent to whom the money is paid on his behalf. I do not think a distinction can meaningfully be drawn between matters external to the operation of the scheme and matters which are the product of the strict application of ss 152 and 153. The facts peculiar to a particular person cannot be considered in isolation from the operation of the provisions of ss 152 and 153. The operation of those sections in the light of the facts surrounding the person concerned is part of the circumstances of the case. The circumstances of a particular case will give rise relevantly to an unreasonable or unjust result only if the operation of Pt XVII, apart from the ameliorating provisions of s 156, produces that result.’

    [29] Mr Smith had suffered a work-related injury but he had returned to light duties when he contracted hepatitis, as a result of which he received sickness benefits. He thereafter received a payment compensating him for his injuries and loss. It may be inferred from the facts there stated that it could not be said that it contained a payment for economic loss for the period when he received sickness benefits, because that entitlement operated to disentitle him from compensation payments. His Honour concluded (at FCR 62; ALD 282):

    In my opinion the tribunal did not fall into error by taking into account an irrelevant consideration when it said:

    “To continue to deprive (the respondent) of that which was paid to him by virtue of his rightful entitlement to sickness benefit on the basis that he is to be taken to have been compensated for it, when in actual fact he was not, would in my view be unjust.”

    I agree with the tribunal that the facts of this case are unusual. By virtue of the agreed facts it is established that during the period from 6 May 1988 to 31 October 1988 the incapacity for work was unrelated to the work injury. In the common run of cases it will not be possible to conclude that during a period of eligibility for a pension which follows a compensable injury attracting a payment by way of compensation within the meaning of s 152(2)(a) that the period of eligibility is unrelated to the compensable injury. The admitted absence of any relationship was a relevant circumstance of the case.

    [30] His Honour also went on to reiterate his view, earlier expressed in Secretary, Department of Social Security v a'Beckett (1990) 26 FCR 349 at 359–60 ; 21 ALD 79 at 88–9 ; 12 AAR 212 at 222–3, which had regard to the statutory assumption that there was an actual coincidence between a period during which pension payments were made and the period during which the pensioner received compensation for an incapacity to work. It was of some importance to his Honour's opinion that the object of the legislation, to prevent double payments for an inability to earn income, was not cut across by applying s 1184 in that case. The situation which was of concern to the statute was not present.

    [31] In Kertland there could have been no dispute that the applicant had not been compensated for economic loss in the settlement, since legislation (the Transport Accident Act 1986 (Vic)) precluded a person, who had been employed at the time of injury, from recovering compensation for economic loss for a period of 18 months. His Honour likewise found the circumstances upon which the statute was predicated, namely compensation for economic loss in that period, not to be present.

    [32] In each of Smith and Kertland it may be said that their Honours took into account the true position. The facts of those cases were unusual. It does not follow that the true facts in every case will have that quality. In those cases it could be seen, objectively, that there could not have been a double payment. In such a circumstance it might be concluded that the statutory assumption operated unjustly. This would not seem to me a situation which would often arise and sets these cases apart from the usual.

1. In relation to the matter before her, her Honour also made the following observations:

   [33] In the present case the Tribunal considered that the application of the formulae was unfair to the applicant because she would have to pay more than she had received by way of compensation for economic loss, indeed twice as much.  That factor will however be present in most cases and is an aspect of the application of the formulae.  In my view it cannot, by itself, amount to a special circumstance, one out of the ordinary.

   [34] The basis for the Tribunal’s view was its acceptance of what the parties to the settlement said had been offered and accepted for the economic loss component.  It was far less than the statute assumed to be the case in applying the formulae.  Again, however, this will be so in many, if not most, cases to which the Act applies.  Further, the extent of the difference from the basis upon which the parties acted could not provide the necessary “special circumstance”.  The statute has selected a figure which may operate in an arbitrary way.”

2. As can be seen from her Honour’s discussion of them, the authorities are to the effect that one of the purposes of s 1184K of the Act is to ameliorate the otherwise harsh operation of the 50% rule in circumstances where the “true” circumstances can be ascertained and where amelioration by reduction of the preclusion period would not result in the mischief the statutory scheme seeks to avoid, namely “double dipping” or simultaneous payment of social security entitlements and compensation for economic loss.

3. Notwithstanding those authorities, the Secretary contends that Mr Glenville’s circumstances are not such as to justify amelioration of the 50% rule.  The Secretary relies on Chamberlain and says that the arbitrary operation of the 50% rule cannot of itself give rise to “special circumstances”.  The Secretary also points to the size of the settlement and contends, in effect, that Mr Glenville will be able to support himself during the preclusion period calculated having regard to the 50% rule, and therefore “special circumstances” do not exist. 

4. However it appears to me that this case is one of those unusual cases referred to in Chamberlain where the “true” circumstances can be established with sufficient certainty such that the compensation preclusion period can be reduced consistently with the overall intention of the statutory scheme.  That is because, unusually, the respondent has expressly and formally conceded in this matter that a figure of $1,000,000 does truly and fairly represent the economic loss component of Mr Glenville’s settlement.  That being the case, the danger which the 50% rule is intended to combat, that is misrepresentation of the economic loss component of a settlement by the parties, does not exist.  In principle, Mr Glenville’s situation is analogous to one in which a court has arrived at a judgment including an economic loss component and the economic loss portion of the judgment is therefore certain.  In those circumstances, the statutory scheme allows regard to be had to the actual amount of economic loss rather than an arbitrary amount derived by reference to the 50% rule.[10]  Here, as in those circumstances, the economic loss component is not in doubt.  It is conceded by the respondent and I am also satisfied that that amount truly represents Mr Glenville’s economic loss.  

   [10] See s 17(3)(b).

5. As to the size of Mr Glenville’s settlement, clearly Mr Glenville has received a very large amount.  He also stands to receive a further equally large sum in 2015.  Notwithstanding the size of Mr Glenville’s settlement however, in the unusual circumstances which have arisen, where the true economic loss component of Mr Glenville’s settlement has been established to the respondent’s satisfaction as well as the Tribunal’s, and where that amount is also $1,500,000 less than the amount to which regard would be had following the 50% rule, it appears to me that the application of the 50% rule produces a particularly unjust result which goes beyond the degree of unfairness contemplated by the legislation.  Further even if unfairness of this degree does not amount to “special circumstances” by itself, I consider that there are additional factors present in Mr Glenville’s case which render his circumstances “special”. 

6. In particular, it is clear Mr Glenville’s future care needs are extremely high and that the vast bulk of his compensation settlement is attributable to those needs.  It would be especially unjust in my view to impose on him a preclusion period calculated on the assumption that money he has in fact been paid by way of compensation for the cost of his future care (and which he will need to pay for that care), has instead been paid to him by way of compensation for economic loss, in circumstances where the respondent concedes that that assumption is incorrect. 

7. I have accordingly concluded that the combination of these circumstances, taken together, is sufficient to amount to “special circumstances” which justify the exercise of the relevant discretion in Mr Glenville’s favour.  For abundant clarity, I consider that the matters which contribute to Mr Glenville’s circumstances being “special” in the relevant sense include the very large amount of his settlement, his very high future care needs, the extremely large discrepancy between the actual economic loss component of his settlement and the amount arrived at by application of the 50% rule, together with the fact that the economic loss component of Mr Glenville’s settlement is conceded by the respondent to have been $1,000.000.

8. By reason of the existence of these “special circumstances” I consider that I should exercise the discretion conferred by s 1184K so as to reduce the preclusion period to that which would result from treating $1,000,000 as the “compensation part of a lump sum compensation payment” in Mr Glenville’s case.  Of course the resulting preclusion period will still be very lengthy, and may exceed Mr Glenville’s expected lifespan.  However for the reasons I have given, it is appropriate in my view that the preclusion period which is imposed in this matter is arrived at by reference to what is acknowledged to be the true economic loss component of the settlement. 

9. Having regard to the fact that Mr Glenville has only been paid half of his total settlement of over $10,000,000, I have considered whether I should regard only $500,000 as the amount of economic loss which has been paid to Mr Glenville with the other $500,000 to be paid to him in the second tranche of compensation.  However Mr Britton did not ask me to take that approach and I have concluded he was right not to do so.  In all the circumstances, I consider it reasonable to treat Mr Glenville as having received the whole of the economic loss component of his settlement in the first tranche of compensation with the second tranche to be comprised primarily of compensation for his future care expenses.

10. For completeness, I note that these issues are likely to arise again if and when the second tranche of the settlement is paid to Mr Glenville.  That is because of the operation of s 1171, which will require a further compensation preclusion period to be calculated having regard to the combined total of the two settlement payments.  Of course, if my reasoning were to be adopted in respect of that further payment, no further compensation preclusion period would be imposed.  However that is an issue which will need to be considered by the decision maker called upon to determine that question if and when the second tranche of compensation is paid to Mr Glenville.

    DECISION

11. The decision under review is varied such that it is determined that by reason of the existence of “special circumstances” within the meaning of s 1184K of the Social Security Act 1991, so much of Mr Glenville’s compensation payment is to be treated as not having been made as will result in a preclusion period equivalent to that which would have been applicable if, for the purposes of s 1170 of the Act, the “compensation part” of his lump sum compensation payment had been $1,000,000.

I certify that the preceding 35 (thirty -five) paragraphs are a true copy of the reasons for the decision herein of Senior Member K Bean.

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Administrative Assistant

Dated 5 June 2012

Date of hearing	28 March 2012
Counsel for the Applicant	Mr G Britton
Advocate for the Applicant	Mr D Russo
Solicitors for the Applicant	Scammell & Co
Advocate for the Respondent	Mr A Parker
Solicitors for the Respondent	Program Litigation and Review