Chung and Secretary, Department of Social Services (Social services second review)

[2019] AATA 425

Chung and Secretary, Department of Social Services (Social services second review) [2019] AATA 425 (19 March 2019)

Division:GENERAL DIVISION

File Number(s):      2018/0096

2018/0097

Re:Mr Hin Chung

Mrs Loc Lai

APPLICANTS

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Ms Anna Burke AO, Member

Date:19 March 2019  

Place:Melbourne

The Tribunal sets aside the decision under review, and remits it to the Secretary to waive $2,500 from Mr Chung’s total debt for Centrelink’s administrative failure in respect of reconciling the ownership of 10 Geoffrey Court, Narre Warren for many years; and to waive $2,500 from Mrs Lai’s total debt for Centrelink’s administrative failure in respect of reconciling the ownership of 10 Geoffrey Court, Narre Warren for many years.

............[sgd]............................................................

Ms Anna Burke AO, Member

Catchwords

SOCIAL SECURITY – Newstart allowance –– Parenting payment partnered - overpayment – debt due to the Commonwealth – whether recovery of debt should be written off or waived – debt not attributable solely to error made by Centrelink – no special circumstances – decision under review set aside and remitted

Legislation

Administrative Appeals Tribunal Act 1975
Social Security Act 1991
Social Security (Administration) Act 1999

Cases

Re Anderson and Secretary, Department of Families and Community Services [2002] 69 ALD 494
Re Callaghan and Secretary Department of Social Security [1996] 45 ALD 435
Groth and Secretary, Department of Social Security [1995] FCA 1708; (1995) 40 ALD 541
Ryde v Secretary, Department of Family and Community Services [2005] FCA 866

Secondary Materials

Guide to Social Security Law

REASONS FOR DECISION

Ms Anna Burke AO, Member

19 March 2019

1. Mr Chung and Mrs Lai (the Applicants) are seeking a second tier review of the decision made by the Secretary of the Department of Social Services (the Respondent) to raise and recover newstart allowance (Newstart) and parenting payment partnered (PPP) debts. The Respondent submits that the debts are as follows:

   ·Mr Chung - PPP - for the period from 24 November 2006 to 22 February 2012 $49,224.33;

   ·Mr Chung - Newstart - for the period from 23 February 2012 to 21 June 2017 $59,242.84;

   ·Mrs Lai - Newstart - for the period from 3 September 2009 to 22 February 2012 $27,435.47; and

   ·Mrs Lai  - PPP - for the period from 23 February 2012 to 21 June 2017 $65,440.94

2. These applications were heard together on 14 January 2019. Mr Chung and Mrs Lai were self-represented and Mr Tim Noonan, a government lawyer in the Freedom of Information and Litigation Team of the Department of Human Services, appeared for the Respondent. The Tribunal was assisted by an interrupter in the Hakka (Timorese) language.

   BACKGROUND

3. Mr Chung:

   ·            arrived in Australia in 1996, first having fled from East Timor to Portugal as a refugee and then migrated to Australia to be with his extended family (his parents had arrived in Australia around 1987;

   ·does not speak, read or write English. Has not worked since coming to Australia, advising the Tribunal he had won Tattslotto and used the winnings to purchase a home for himself and one for his parents; there is no mortgage on either property and he  receives rental income from 10 Geoffrey Court;

   ·was in receipt of Newstart from 1 August 1996 to 24 February 1999, and from 23 February 2012 to 21 June 2017;

   ·married Mrs Lai around September 1999; they have three children together;

   ·received PPP from 30 October 1999 to the 22 February 2012;

   ·since September 1999 has advised Centrelink that he owned and resided at 12 Belmore Court, Narre Warren;

   ·on 18 November 1999 declared he owned 33% of a property at 10 Geoffrey Court Narre Warren, his parents owned the balance of the property and the estimated value of the property was $170,000;

   ·on 22 April 2002 advised Centrelink he owned 100% of 10 Geoffrey Court, Narre Warren, with an estimated value of $175,000;

   ·on 14 October 2005 advised Centrelink he owned 50% of 10 Geoffrey Court, Narre Warren, with an estimated value $282,000;

   ·on 24 November 2006 the property at 10 Geoffrey Court Narre Warren transferred into Mr Chung’s and Mrs Lai’s ownership following the death of his parents;

   ·on 13 June 2007 notified Centrelink that the estimated value of 10 Geoffrey Court, Narre Warren was $300,000; and that he was receiving rental income from the property;

   ·on 18 September 2009 notified Centrelink that the rental income had increased; (he has not advised of any increase since this time);

   ·on 10 September 2009 signed as Mrs Lai’s partner on her customer declaration form for Newstart allowance which stated: ”I have no real estate interest other than the home in which I live”;

   ·in the period from 24 November 2006 to 22 February 2012 received  $49,224.33 for PPP;

   ·in the period from 23 February 2012 to 21 June 2017 received an amount of $59,242.84 in Newstart allowance;

   ·on 19 May 2017 Centrelink raised a Newstart and parenting payment debt against Mr Chung on the basis that the correct percentage of ownership and rental income for the property at 10 Jeffrey Court Narre Warren had not been taken into account. Centrelink determined that the value of 10 Jeffrey Court Narre Warren had been more than the asset value limit for a partnered homeowner since 24 November 2006 and as such there was no entitlement to Newstart allowance and parenting payment from that date onwards

   ·was not entitled to these payments; and

   ·therefore had  a debt  raised by Centrelink for the total of these amounts.

4. Mrs Lai:

   ·arrived in Australia in 1990 from East Timor, and worked for about two years;

   ·married Mr Chung in 1999, subsequently having three children;

   ·does not speak, read or write English;

   ·since October 1999 has advised Centrelink that she resided at 12 Belmore Court, Narre Warren;

   ·on 10 September 2009 signed a customer declaration form for newstart allowance which stated: “I have no real estate interest other than the home in which I live”;

   ·on 6 February 2017 Centrelink conducted a review of entitlement for newstart allowance for Mr Lai. Mrs Lai gave permission for her daughter to speak on her behalf to Centrelink as her English is limited. Centrelink queried Mrs Lai’s daughter on property ownership as there records indicated property was owned 50% by her partner but nothing was recorded for her and had been like that for years. Mrs Lai’s daughter confirmed that her parents owned 50% each of the property. As there had been no income update since 2009 Centrelink advised that they are required to do that and Mrs Lai’s daughter advised they would forward income and asset update form;

   ·on 17 February 2017  lodged a real estate details form with Centrelink advising she had a 50% share in the property at 10 Geoffrey Court, Narre Warren from May 1999;

   ·in the period from 3 September 2009 to 22 February 2012 received an amount of $27,435.47 in newstart allowance;

   ·in the period from 23 February 2012 to 21 June 2017 received an amount of $65,440.94 for PPP;

   ·

   on 19 May 2017 Centrelink raised a newstart and parenting payment debt against Mrs Lai on the basis that the correct percentage of ownership and rental income for the property at 10 Geoffrey Court Narre Warren had not been taken into account. Centrelink determined that the value of 10 Geoffrey Court Narre Warren had been more than the asset value limit for a partnered homeowner since

   
   

   24 November 2006 and as such there was no entitlement to Newstart allowance and parenting payment from that date onwards;

   ·was not entitled to these payments; and

   ·therefore had a debt  raised by Centrelink for the total of these amounts.

5. On 19 May 2017 Centrelink advised Mr Chung and Mrs Lai via separate letters that they had a legally recoverable debt to the Commonwealth as they had been overpaid both Newstart and PPP as the correct percentage of ownership for 10 Geoffrey Court, Narre Warren and gross rental income received for this property  had not been taken into account.

6. On 28 June 2017, on internal review, a departmental Authorised Review Officer (ARO) affirmed the original decision against Mr Chung and found that:

   While you were receiving Parenting Payment and Newstart Allowance, the department sent you letters which stated the asset value being used for 10 Geoffrey Ct, the percentage of ownership being assessed for you, and the requirement for you not notify the department, within 14 days, if the value of yours and Mrs Lai’s assets increased.

   Yours and Mrs Lai’s combined assets increased on 24 November 2006 when ownership of 10 Geoffrey Ct was transferred from you and Ki Juc Chung to you and Mrs Lai. The value of your combined assets was above the asset cut-out amount from that date onwards. However, you did not notify the department that Mrs Lai had ownership of the property and, therefore, that your combined assets had increased above the cut out amount.

   A debt may also be waivered if there are special circumstances. Your circumstances need to be sufficiently unusual or common as to be termed special. When we spoke on 19 June 2017 you told me that neither you nor Mrs Lai speak English and you didn’t know what information was in the letters the department sent to you; neither of you were working; you cannot afford electricity and water; you have poor eyesight, high blood pressure and high cholesterol; and you have had a lung and liver infection in the past. I do not consider these circumstances are unusual or uncommon. As such, the debts cannot be waivered on special circumstances grounds.

7. On 28 June 2017, on internal review, a departmental Authorised Review Officer (ARO) affirmed the original decision against Mrs Lai and found  that:

   On the ‘Customer Declaration Form Newstart Allowance (i.e. the Newstart Allowance claim) signed by you on 10 September 2009, you declared that you did not own any real estate other than the home you lived in. On that form, you declared your home address was 12 Belmore Court Narre Warren. The department’s records do not show that you advised the department of your ownership in 10 Geoffrey Ct, Narre Warren at any time prior to February 2017.

   While you were receiving Newstart Allowance and Parenting Payment, the department sent you letters which explain the requirements for to notify the department, within 14 days or by your reporting day, if the value of yours and Mr Chung’s assets increased above certain amounts (the asset value limits). The value of yours and Mr Chung’s assets was above the amount specified in the letters but you did not contact the department.

   I have found that the entire Newstart Allowance debt and the portion of the Parenting Payment debt from 23 February 2012 to 15 February 2017 came about because you did not notify the department about your ownership of 10 Geoffrey Ct and that your assets were above the amount specified in the letters the department sent to you…

   A debt may also be waivered if there are special circumstances that make it desirable to waive. Your circumstances need to be sufficiently unusual or uncommon as to be termed special. When we spoke on 19 June 2007, Mr Chung told me that neither you nor he speak English and you didn’t know what information was in the letters the department sent to you; neither of you were working; you cannot afford electricity and water;, and he has some medical conditions. When you and I spoke on 19 June 2017 you told me that Mr Chung is not sleeping because of worry about the debts and your daughter is also very worried. I do not consider that these circumstances are unusual or uncommon. As such, the debts cannot be waived on special circumstances grounds.

8. On 28 November 2017 the Social Services and Child Support Division of the Tribunal
   (the first tier) affirmed the ARO’s decision.  It found that:

   The tribunal has taken into account all of Mr Chung and Mrs Lai’s circumstances, including the circumstances in which the overpayment arose. The tribunal has concluded, on the basis of the material before it that these circumstances were not uncommon or unusual as to warrant exercise of the discretion and waiver the debt and so has therefore determined the debt is recoverable.

9. Mr Chung and Mrs Lai have sought a review of the first tier decision by this division of the Tribunal, as they believe the decision is wrong.

   THE ISSUES IN CONTENTION

10. The Tribunal needs to consider the following relevant issues:

    (a)whether Mr Chung and Mrs Lai were overpaid Newstart and PPP allowances;

    (b)if so, is the debt recoverable; and if yes

    (c)should the debt be waived due to administrative error pursuant to section 1237A of the Social Security Act 1991 ("the Act"); or

    (d)whether special circumstances exist such that the debt should be waived pursuant to section 1237AAD of the Act.

    RELEVANT LEGISLATION AND ISSUES

11. Section 593 of the Act outlines the criteria for qualification for newstart allowance:

    (1)  Subject to sections 596, 596A, 597 and 598, a person is qualified for a newstart allowance in respect of a period if:

    (a)  the person satisfies the Secretary that:

    (i)  throughout the period the person is unemployed;

12. Section 500 of the Act outlines the criteria for qualification for parenting payment:

    Qualification for parenting payment

    (1)   A person is qualified for parenting payment if:

    (a)  the person has at least one PP child (see section 500D); and

    (b)  the person is an Australian resident; and….

13. Section 500D of the Act defines a PP child:

    (1)  A child is a PP child of a person if:

    (a)  the child is a child of the person; and

    (b)  the person is a member of a couple; and

    (c)  the child has not turned 6; and

    (d)  the person is the principal carer of the child.

14. Section 11A of the Act defines a Principal home for the purpose of the assets test

    (1)  A reference in this Act to the principal home of a person includes a reference to:

    (a)  if the principal home is a dwelling-house--the land adjacent to the dwelling-house to the extent that:

    (i)  the land is held under the same title document as the land on which the dwelling-house is located; and

    (ii)  the private land use test in subsection (3) is satisfied in relation to the land or, if the person is one to whom the extended land use test applies in relation to the land, the extended land use test in subsection (6) is satisfied in relation to the land;…..

15. Section 500Q of the Act outlines that parenting payment is not payable if a person’s assets exceeded a value limit:

    (1)  Parenting payment is not payable to a person if the value of the person's assets exceeds the person's assets value limit.

    (2)  The assets value limit of a person who is not a member of a couple is worked out using the following table:

16. Section 611 of the Act outlines that newstart allowance is not payable if a person’s assets exceeded a value limit:

    (1)  A newstart allowance is not payable to a person if the value of the person's assets is more than the person's assets value limit.

    (2)  A person's assets value limit is worked out using the following table: work out which family situation applies to the person; the assets value limit is the corresponding amount in the assets value limit column.

17. Section 612 of the Act outlines how a person’s assets are valued if they are a member of a couple:

    Value of assets of members of couples

    ….

    (2)  If:

    (a)  a person is a member of a couple; and

    (b)  the person's partner is in receipt of:

    (i)  a social security or service pension, income support supplement or a veteran payment; or

    (ii)  a social security benefit;

    the value of:

    (c)  the person's assets is taken to be 50% of the sum of the value of the assets of the person and the value of the assets of the person's partner; and

    (d)  the person's assets of a particular kind are taken to be 50% of the sum of the value of the assets of that kind of the person and the value of the assets of that kind of the person's partner.

18. The Social Security Guide states:

    1.2.1.10 Newstart Allowance (NSA) - Description

    NSA is an income support payment that provides financial assistance to people aged 22 years or older but under age pension age who are unemployed or treated as unemployed and, unless exempted from mutual obligation requirements:

    ·     are participating in or willing to participate in approved activities and/or job search, and

    ·     are prepared to enter into, comply with or vary an existing Job Plan to fulfil the mutual obligation requirements

    NSA is calculated on a daily basis and is paid in arrears, generally in instalments of 14 days. Instalment periods of less than 14 days may be paid where a person changes their payday arrangements.

    1.2.4.10 Parenting Payment (PP) - Description

    PP is an income support payment that provides financial assistance to principal carers with parenting responsibilities for a young child and provides them with incentives to increase workforce participation and reduce dependency on income support.

    It is a payment for both single and partnered parents and it is payable to one member of a couple 1.1.M.120. An alternative income support payment such as NSA may be payable to the other member of the couple, depending upon their individual circumstances.

    The history of the payment has resulted in certain features that are not common to other income support payments. There are effectively 2 different categories within PP. These are:

    •PPS for single parents with a youngest child aged less than 8 years old, and

    •PPP for partnered parents with a youngest child aged less than 6 years old.

    4 Income & Assets

    Australia has an income support system that is designed to be a safety net for people unable to support themselves without calling on the resources of the community. The income and assets tests are used to target the system so that it remains sustainable and affordable for Australian taxpayers. The tests help ensure that the funds available for social security expenditure are directed to those in the community most in need. The tests are kept under review to ensure that they are meeting the requirements of the community for well-targeted income support.

    The rate of income support payable depends on the income and assets tests. The rate of payment is calculated under the 2 separate tests and the test that results in the lower (or Nil) rate is the one that applies.

19. Section 1223 of the Act outlines how debts arise from lack of qualification, overpayment etc:

    (1)  Subject to this section, if:

    a)    a social security payment is made; and

    b)    a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit;

    the amount of the payment is a debt due to the Commonwealth by the person and the debt is taken to arise when the person obtains the benefit of the payment.

20. Section 1237A(1) of the Act provides grounds for the decision-maker to waive recovery of any part of the debt. The Act provides that the decision-maker must waive a debt if it was attributable solely to an administrative error made by the Commonwealth and the debtor received the payments in good faith.

21. Section 1236 of the Act allows the decision-maker to write off a debt if, and only if:

    (a)the debt is irrecoverable at law; or

    (b)the debtor has no capacity to repay the debt; or

    (c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or 

    (d)it is not cost-effective for the Commonwealth to take action to recover the debt.

22. Section 1237AAD of the Act allows the decision-maker to waive all or part of the debt if they are satisfied that:

    (a)  the debt did not result wholly or partly from the debtor or another person knowingly:

    (i)  making a false statement or a false representation; or

    (ii)  failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and

    (b)  there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

    (c)  it is more appropriate to waive than to write off the debt or part of the debt.

    THE TRIBUNAL’S CONSIDERATION AND FINDINGS

    Evidence before the Tribunal

1. The evidence before the Tribunal included documents provided by the Respondent pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, referred to as the “T documents”. Mr Chung and Mrs Lai also gave oral evidence at the hearing of this matter.

2. Mr Chung and Mrs Lai advised the Tribunal that because they don’t speak English they simply didn’t understand what was required of them. They had approached Centrelink as they needed financial support, had applied for and been granted certain benefits. On each occasion they had attended Centrelink they had been assisted by interpreters and could not read what was being put on the forms and simply assumed that the information they had provided was accurately recorded by the interpreter. They told the Tribunal that when they receive letters from Centrelink, as they do not understand them and as the money was going into their account, they assumed everything was okay. Therefore, they never sought to have the letters interpreted so they could understand their obligations.

3. Mr Chung was adamant he had always advised Centrelink of the correct ownership of his property and Centrelink should have asked him who owned the other 50% of the property.

4. Mrs Lai was adamant she had always advised Centrelink when applying for newstart that she had two properties, stating on numerous occasions: “I don’t know maybe the interpreter didn’t tell them, I told them I got two properties.”

5. Mr Chung and Mrs Lai were both of the opinion that Centrelink had contributed to the debt as Centrelink had failed to query Mrs Lai’s form for Newstart submitted in 2009, which had indicated both Mr Chung and Mrs Lai had “no real estate interest other than the home in which I live”, which did not accord with their records for Mr Chung. They also queried why Centrelink had taken such an inordinate amount of time to query the ownership of the property, since by its own admission Centrelink records had indicated Mr Chung had 50% of the property but indicated nothing for Mrs Lai; and “it had been like that for years”.

6. The Respondent argued that the debts have been correctly calculated and had arisen as Mr Chung and Mrs Lai had failed to advise Centrelink that she owned 50% of 10 Geoffrey Court, Narre Warren. The Respondent argued that Mr Chung and Mrs Lai had failed to comply with numerous information notices issued by Centrelink, requesting that they advise Centrelink of any changes in circumstances, which would change the value of their assets. The Respondent further argued that the value of their assets exceeded the asset value limit set out in the Act and therefore they had been overpaid both Newstart and PPP. This resulted in them owing a recoverable debt to the Commonwealth.

7. The Tribunal finds that Mr Chung and Mrs Lai owe a debt to the Commonwealth as they had been overpaid Newstart and PPP, as their assets exceeded the asset value limit set out the Act. The Tribunal will now explore if any of the debt was attributable to administrative error on the Respondent’s part; or if there were special circumstances in which to write off or waive all or part of the debt.

   Writing-off the debt

8. The Tribunal, standing in the shoes of the Secretary, has the discretion to write-off the debt under section 1236 of the Act.

9. On the evidence before the Tribunal, Mr Chung and Mrs Lai did not meet the criteria as established in section 1236 of the Act. As such, the Tribunal is unable to write-off the debt. Indeed, Mr Chung and Mrs Lai are currently repaying the debt by way of fortnightly deductions from their current Centrelink benefits.

10. However, at the hearing the Tribunal had requested the Centrelink representative to assist Mr Chung and Mrs Lai to recalculate the current repayment plan as it was evident to the Tribunal that Mr Chung and Mrs Lai had significant financial burdens and were struggling to survive on their current benefits and rental income, once the debt deduction had been made.

    Waiver the debt on the basis of administrative error

11. Under section 1237A of the Act, the Tribunal has discretion to waive the right to collect the debt, if it was due solely to administrative error.

12. The Respondent submitted that the debt had not arisen as a result of administrative error; and consequently section 1237A of the Act was not satisfied.

13. Mr Chung and Mrs Lai were adamant that Centrelink had contributed to the debt by way of administrative error, as Centrelink had failed to clarify information in respect of the rental property for eight years although they were aware of the discrepancy.

14. Mr Chung advised the Tribunal he had always advised Centrelink of his percentage share of the property at 10 Geoffrey Court; and he did not see it was his responsibility to advise Centrelink who owned the other percentage share of the property. This would appear to the Tribunal to be a result of language difficulties experienced by Mr Chung.

15. Mrs Lai presented to the Tribunal as an honest and forthright individual who was adamant she had advised Centrelink that she owned two properties and this had not been recorded accurately by the interpreter. The Tribunal was unable to verify this statement and this was compounded by the fact that Centrelink had on file a notice issued by the City of Casey on 11 August 2009 indicating both Mr Chung and Mrs Lai were ratepayers of 10 Geoffrey Court, Narre Warren. However, this had not been recorded on any Centrelink documentation and the Tribunal had been unable to verify when Centrelink had received this document.

16. The Tribunal finds that Centrelink had failed to query inconsistent data on its system for many years in respect of the property at 10 Geoffrey Court, thereby compounding Mr Chung and Mrs Lai’s debt liability. The Tribunal finds that Mr Chung and Mrs Lai had also contributed to this situation by failing to advise Centrelink that their circumstances had changed over the years and by failing to advise them of the correct asset value.

17. Whilst the Tribunal is sympathetic to Mr Chung’s and Mrs Lai’s situation, given their none existent English language ability, and the complexity of Centrelink forms, it is also mindful that Mr Chung and Mrs Lai had during this period managed successfully to lease the property at 10 Geoffrey Court, Narre Warren. Indeed they advised the Tribunal that if they received letters in respect of the property they would seek out someone to interpret this information for them. They explained they did this as they were responsible for the maintenance of the property. This was in stark contrast to their view of Centrelink letters, which they simply ignored.

18. The Tribunal did not find it had discretion to waive the right to collect the debt as it was not due solely to administrative error, but did consider Centrelink had contributed to the debt for a period of time as they had not acted on the fact Mr Chung had adviser he owed 100% of the property in April 2002 and Mrs Lai appears to have provided a rate notice to Centrelink in August 2009. As such the Tribunal has determined to waive part of the debt equivalent for a period of time between the information being provided to Centrelink and the date of the next information letter from Centrelink requesting Mr Chung and Mrs Lai separately to update their financial details which on their own admission they consistently ignored.

    Waiver of all or part of the debt in special circumstances

19. The Tribunal, standing in the shoes of the Secretary, also has the discretion to waive all or part of Mr Chung’s and Mrs Lai’s debt in special circumstances. For the discretion to be exercised, all three conditions contained in subsections (a), (b), and (c) of section 1237AAD must be satisfied.

20. The Respondent contends that there is no evidence to suggest that Mr Chung’s and Mrs Lai’s circumstances are such that they can be considered special to the extent that waiver of part or all of the debt is warranted under section 1237AAD.

    Knowingly

21. The term ‘knowingly’ has not been defined in the Act, although it has been considered extensively by the Tribunal in similar circumstances.

22. In Re Callaghan and Secretary Department of Social Security [1996] 45 ALD 435, Deputy President Forgie said:

    There is nothing in section 1237AAD which suggests that the word “knowingly” should be given any meaning other than that a person has actual knowledge rather than constructive knowledge, that he or she is making a false statement or representation that he or she is failing or admitting to comply with a provision of the Act. The actual knowledge is to be ascertained by reference to the statements of the person as to his or her actual state of knowledge at the time and to events surrounding the false statement or the act of omission.

23. The Tribunal finds that Mr Chung’s and Mrs Lai’s debt did not arise because they knowingly made false statements or declarations. The Tribunal finds that Mr Chung and Mrs Lai did not deliberately act dishonestly with any intention to mislead Centrelink.

24. Indeed, it would appear to the Tribunal that Mr Chung had on every occasion advised Centrelink of his correct ownership of the property; and his failure to advise Centrelink of his wife’s ownership resulted from language barriers and not an attempt to deceive the Department. Mrs Lai was adamant she had advised Centrelink she owned two properties and had never attempted to mislead them.

25. In Re Anderson and Secretary, Department of Families and Community Services [2002] 69 ALD 494, the Tribunal stated:

    […] it is open to the tribunal to infer that the applicant has actual knowledge of his obligations under the act where there are opportunities for that knowledge to be gained when there are no obstacles to him acquiring knowledge. In this case, the applicant has had the opportunity to gain an understanding of his obligations under the Act to the provision of advice letters to him from the respondent. The tribunal is not aware of any obstacles that would prevent Mr Anderson from understanding those letters and gaining that knowledge.

26. The Tribunal finds Mr Chung and Mrs Lai did not knowingly or deliberately mislead Centrelink, and therefore the debt has not arisen solely or partly from their knowingly making a false statement or knowingly failing to comply with the legislation. As such, subsection (a) of section 1237AAD of the Act is not satisfied.

    Special circumstances

27. The expression ‘special circumstances’ has not been defined in the Act. However, the meaning of special circumstances has been considered extensively by the Federal Court and the Tribunal.

28. In Ryde v Sec Department of Family and Community Services [2005] FCA 886, Branson J said:

    […] the evident purpose of s 1237AAD is to enable a flexible response to the wide range of circumstances which could give rise to hardship or unfairness, the statutory requirement for special circumstances discloses an intention to proscribe waiver in ordinary cases. The hardship or unfairness to which French J referred must be understood to be hardship or unfairness sufficient to justify departure from the general rule in the particular case.

29. In Groth v Secretary Department of Social Security [1995] FCA 1708, Kiefel J said:

    […] for present purposes it is sufficient to observe that it requires something to distinguish Mr Groth’s case from others, to take it out of the usual ordinary case. That was, I consider, the only enquiry to be undertaken in this case. It would of course follow if one to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.

30. In summary, it has been held that for circumstances to constitute special circumstances they must be circumstances which are unusual, uncommon or exceptional, markedly different from the usual run of cases, special, or out of the ordinary, and they include events which would render the strict application of the rule in question unfair or inappropriate.

31. Mr Chung and Mrs Lai reiterated to the Tribunal their current financial difficulties and their lack of English should be considered by the Tribunal as special circumstances, which had contributed to both the debt and their inability to repay the amount. However, the Tribunal notes that the lack of English language skills, verbal and written, and financial hardship are not exceptional or uncommon within the Australian community.

32. The Respondent submitted there was no substantive reason or evidence provided by Mr Chung and Mrs Lai which would impugn the correctness of the decision made by the first tier of the Tribunal.

33. The Tribunal finds Mr Chung and Mrs Lai had not demonstrated any hardship or unfairness sufficient to constitute special circumstances which would justify waiving their debt.

    Waiving the debt more appropriate than writing-off the debt

34. The Tribunal finds that Centrelink in part has contributed to Mr Chung’s and Mrs Lai’s debts as they did not act upon the City of Casey valuation notice (which is stamped as received on 14 August 2009)  for the property which indicates both Mr Chung and Mrs Lai are owners of the property at 10 Geoffrey Court, Narre Warren. The Tribunal decides that part of the debt should be waived in recognition of the administrative failure of Centrelink to rectify its records.

    DECISION

35. The Tribunal sets aside the decision under review, and remits it to the Secretary to waive $2,500 from Mr Chung’s total debt for Centerlink’s administrative failure in respect of reconciling the ownership of 10 Geoffrey Court, Narre Warren for many years: and to waive $2,500 from Mrs Lai’s total debt for Centerlink’s administrative failure in respect of reconciling the ownership of 10 Geoffrey Court, Narre Warren for many years.

58.     I certify that the preceding 57 (fifty-seven) paragraphs are a true copy of the written reasons for the decision of Ms Anna Burke, Member

..........[sgd].............................................................

Associate
Dated: 19 March 2019

Date of hearing

14 January 2019

Applicant

Self-represented

Advocate for the Respondent

Solicitors for the Respondent

Mr Tim Noonan

Department of Human Services,
Freedom of Information & Litigation Branch