Clark; Secretary, Department of Social Services and (Social services second review) - [2021] AATA 10

Clark; Secretary, Department of Social Services and (Social services second review) [2021] AATA 10 (11 January 2021)
Division:GENERAL DIVISION
File Number(s): 2020/0336
Re:Secretary, Department of Social Services
APPLICANT

AndCassandra Clark
RESPONDENT

DECISION
Tribunal:Chris Puplick AM, Senior Member
Date:11 January 2021
Place:Sydney

The decision under review is set aside and in substitution it is decided that:
(a)the debt for the period 13 September 2013 to 9 October 2013 is waived in its entirety pursuant to section 1237A of the Social Security Act 1991 (Cth) (Act); and
(b)the debt for the period 10 October 2013 to 5 October 2018 is waived in its entirety pursuant to section 1237AAD of the Act.

................................[sgd]................................
Chris Puplick AM, Senior Member
CATCHWORDS
SOCIAL SECURITY – Carer Payment – Family Tax Benefit – whether debt should be recovered – writing off debt – waiver of debt arising from sole administrative error – whether there was sole administrative error – waiver of debt in special circumstances – whether special circumstances exist – reviewable decision is set aside and substituted
LEGISLATION
Social Security Act 1991 (Cth) ss 1236, 1237A, 1237AAD
Social Security (Administration) Act 1999 (Cth) ss 66A, 68
Social Security Legislation Amendment (Carers Pension and Other Measures) Act 1995 (Cth)
CASES
Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25
Balancio v Secretary, Department of Family and Community Services (2003) 74 ALD 204
Boscolo v Secretary, Department of Social Security (1999) 53 ALD 277
Brittain and Secretary, Department of Family and Community Services [2000] AATA 161
Brown and Department of Family and Community Services [1999] AATA 113
Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114
Dean and Department of Education, Science and Training [2005] AATA 586
Dranichnikov v Centrelink [2003] FCAFC 133
Fisher and Secretary, Department of Education, Employment and Workplace Relations [2008] AATA 410
Gerhardt and Department Employment, Education and Training [1996] AATA 173
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Hogan and Secretary, Department of Employment, Education and Workplace Relations [2011] AATA 162
Jess v Scott (1986) 70 ALR 185
Lind and Secretary, Department of Social Services [2014] AATA 680
Love and Secretary, Department of Social Services (Social services second review) [2016] AATA 8
Minister for Community Services and Health v Chee Keong Thoo (1988) 78 ALR 307
Nehma and Department of Family and Community Services [1999] AATA 219
Perkich and Secretary, Department of Social Security (1997) 49 ALD 137
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Gale and Secretary, Department of Employment, Education and Training (1996) 42 ALD 477
Re Secretary, Department of Social Security and McAvoy (1996) 44 ALD 721
Riddell v Secretary, Department of Social Security (1993) 30 ALD 31
Ryde Municipal Council v Macquarie University (1978) 23 ALR 41
Secretary, Department of Education, Employment and Workplace Relations and Brookes [2008] AATA 501
Secretary, Department of Education, Employment, Training and Youth Affairs v Prince [1997] FCA 1565
Secretary, Department of Employment and Workplace Relations and Bilgin [2007] AATA 1167
Secretary, Department of Employment and Workplace Relations and Taylor [2007] AATA 1377
Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Walsh [2008] AATA 75
Secretary, Department of Family and Community Services and Jonauskas [2001] AATA 72
Secretary, Department of Social Security v Hales (1998) 82 FCR 154
Secretary, Department of Social Security v Thompson (1994) 36 ALD 563
Secretary, Department of Social Services and Tomlin (Social services second review) [2017] AATA 1810
Secretary, Department of Social Services and Waqar (Social services second review) [2020] AATA 1493
Secretary, Department of Social Services v Hodgson (1992) 27 ALD 309
Skinner and Secretary, Department of Social Services (Social services second review) [2015] AATA 569
Tabije and Secretary Department of Social Services [2014] AATA 778
Ward and Secretary, Department of Family and Community Services [2000] AATA 212
SECONDARY MATERIALS
Explanatory Memorandum, Social Security Legislation Amendment (Carers Pension and Other Measures) Bill1995 (Cth)
Guides to Social Policy Law – Social Security Guide
REASONS FOR DECISION
Chris Puplick AM, Senior Member
11 January 2021
BACKGROUND

On 13 September 2013 the Applicant granted Mrs Cassandra Clark (Respondent) carer payment (CP) in relation to her child RJ who was born in 2010. The Respondent had been in receipt of Family Tax Benefit (FTB) since October 2003.
CP is paid pursuant to provisions in the Social Security Act 1991 (Cth) (Act) and in accordance with guidelines set out in the Social Security Guide (Guide).
In her application for CP the Respondent provided details of her family income as was required by Centrelink.
In granting the Respondent CP, Centrelink failed to apply the information which it had been given to its calculations of her entitlement to this payment and this resulted in the Respondent being overpaid CP.
Between 13 September 2013 and 14 November 2018 there was extensive written and verbal communication between the parties. The Applicant wrote to the Respondent on numerous occasions either requesting information or advising her of their current records of her income and assets, the basis upon which both CP and FTB payments were being paid.[1] There were also numerous personal discussions involving the Respondent either visiting the Maitland office of Centrelink or talking to Centrelink officers on the telephone.
[1] Details of the correspondence are set out in the Applicant’s statement of facts, issues and contentions dated 16 June 2020 (Applicant’s SFIC) at [3]. See also section 37 documents (T documents) at 239.
On 14 November 2018 the Applicant determined that the Respondent had been overpaid CP for the period 13 September 2013 to 5 October 2018 in the sum of $27,857.72 and consequently raised a debt against the Respondent.
The Respondent requested an internal review of that decision. On 7 January 2019 an Authorised Review Officer (ARO) of the Department waived a sum of $1,427.25. This was on the basis that overpayments had been made between 13 September 2013 and 30 January 2014 as a result of the Department’s sole administrative error. The ARO found that at the time of the Respondent’s CP application, she had provided the Department with current information relating to her husband’s business and had received the CP payments in good faith during that period.
The ARO, nevertheless, affirmed the remaining part of the debt as existing between 31 January 2014 and 5 October 2018 in the sum of $26,430.47.[2]
[2] T documents at 238-243.
The Respondent sought review of this decision by the Social Services and Child Support Division of the Tribunal (AAT1) which, on 19 December 2019, decided that the whole of the debt should be waived due to sole administrative error on the part of the Department.[3]
[3] Ibid 3-13.
On 17 January 2020 the Applicant sought review of that AAT1 decision in this Tribunal and the matter was heard on 27 November 2020. The proceedings were conducted using the Microsoft Teams platform and the Respondent was represented by a solicitor from the Welfare Rights Centre.
THE APPLICANT’S POSITION
The Applicant accepts that between 13 September 2013 and 9 October 2013 there was sole administrative error on the part of the Department in that it overlooked the details of the Respondent’s declared income which had been provided by her on 4 September 2013.
The Applicant also accepts that this administrative error persisted during the remaining period from 10 October 2013 until 5 October 2018 (debt period) as the Department continued to overlook the advice from the Respondent which was about the income received by her husband in his capacity as a sole trader.
Importantly, the Applicant accepts that the Respondent received her CP payments in good faith[4] and that there was no attempt on her part to act dishonestly or deceptively at any stage.[5]
[4] Applicant’s SFIC at [5.7]. See Secretary, Department of Education, Employment, Training and Youth Affairs v Prince [1997] FCA 1565.
[5] Applicant’s SFIC at [8.71].
However, the Applicant claims that, contrary to the finding of the AAT1, the continuing overpayment of CP (and hence the creation of a debt) was not the result of sole administrative error on the part of the Department. The Applicant asserts that it was contributed to by the failure of the Respondent to comply with her statutory reporting obligations during the debt period.
In particular, the Applicant alleges the Respondent failed to respond to a notice (section 68 notice given under the Social Security (Administration) Act 1999 (Cth) (Administration Act)) dated 10 October 2013 which required her to inform the Department of specified changes of circumstances (including financial) which might affect her payment of/ eligibility for CP. This notice specifically required the Respondent to advise the Department, within 14 days, of changes to her husband’s income. There is also a general obligation under section 66A of the Administration Act for social security recipients to keep the Department informed of changes to their financial and other relevant circumstances.
It follows, in the Applicant’s submission, that as a result of the Respondent’s non-compliance a debt has arisen which was not due to sole administrative error and that it should be recovered as there are no grounds upon which it should be waived or written off.
THE RESPONDENT’S POSITION
The Respondent is seeking a determination by the Tribunal that she should not have to repay to the Commonwealth the debt that has arisen, which the Applicant claims should be repaid.
The Respondent does not dispute that there has been an overpayment of CP. However, the Respondent claims that she had met her statutory reporting obligations in that she has provided regular (financial) updates to the Department in relation to her FTB payments and was entitled to assume that once information was provided to the Department for one type of social security payment that such information would be applied by the Department in relation to its calculations of any other payments.[6] The Respondent did not understand, nor was advised, that there are separate reporting obligations for each of the welfare benefits.[7]
[6] T documents at 233 and 321.
[7] Respondent’s statement dated 7 September 2020 at [17].
The AAT1 was sympathetic to this position and furthermore found that the correspondence from the Department to the Respondent was such that neither she:
or any other person of reasonable mind, would be able to understand from these notices that Centrelink was not aware of her combined income for the purpose of calculating her carer payment, or that she was required to report her income separately for FTB and carer payment.[8]
[8] T documents at 8 [32].
In this respect, reliance was placed on the Tribunal’s decision in Tomlin[9] which drew attention to the confusion arising from Centrelink notices to welfare recipients regarding reporting arrangements for separate social security payments.
[9] Secretary, Department of Social Services and Tomlin (Social services second review) [2017] AATA 1810, [42].
The Respondent’s legal representative also advanced a unique proposition, namely that the CP should never have been granted in the first place. The Tribunal does not find that there is sole administrative error on this basis. It was argued that the Respondent was advised her claim for CP “is to be rejected” (as stated in an internal Centrelink record of the 1 October 2013 written correspondence sent to the Respondent) unless certain financial data was provided by her related to her partner’s tax returns and balance sheets.[10]
[10] T documents at 285.
Some of the requested information was not provided but nevertheless CP was granted. In the 1 October 2013 letter received by the Respondent she was, however, actually informed that her CP “may be rejected” and that “[i]f you can’t provide the information by the due date you need to contact us”.[11]
[11] Ibid 399.
The Applicant also drew attention to a letter sent by the Respondent to the Department on 8 October 2013 which indicated that she had spoken to the Department and they had accepted her assurance that the relevant information would be supplied when it became available.[12]
[12] Ibid 109.
The Respondent had contacted the Department in response to the 1 October 2013 letter because she knew that some of the information could not be provided by the due date. As a result of her communication with the Department, the time for her to file the remaining requested information was effectively extended.
The Tribunal notes that it is equally open to see this exchange as illustrating the fact that the Respondent knew she had an obligation to provide certain financial details to the Department, undertook to do so and then failed to honour that undertaking.
WRITING OFF DEBT
Under the Act there are two ways in which debts to the Commonwealth may be forgiven, and/or not recovered, either by write off or by waiver.
Section 1236 of the Act provides that a debt may be written off in the following circumstances:
1236 Secretary may write off debt
(1) Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.
(1A) The Secretary may decide to write off a debt under subsection (1) 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.
Debts that are written off do not disappear. While they may not be recoverable at the time of write off, they nevertheless persist and may be recovered at a later date or upon a change of circumstances. In any event, the statutory requirements for the writing off of the debt in question in this matter are not met as there is no evidence, for example, that the Respondent has no capacity to repay it.
It is therefore inappropriate to consider writing off the debt under section 1236 of the Act.
The question of a waiver of the debt is discussed below.
WAIVER OF DEBT – SOLE ADMINISTRATIVE ERROR
The relevant section of the Act, section 1237A provides:
Waiver of debt arising from error
Administrative error
(1) Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
Note: Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).
(1A) Subsection (1) only applies if:
(a) the debt is not raised within a period of 6 weeks from the first payment that caused the debt; or
(b) if the debt arose because a person has complied with a notification obligation, the debt is not raised within a period of 6 weeks from the end of the notification period;
whichever is the later.
The starting point of this discussion must be the section 68 notice of 10 October 2013. This letter advised that the Respondent was to receive CP at the rate of $566.60 and:
Information used for calculating your regular payment
Combined Annual Income ………….$5.94[13]
[13] T documents at 409.
There was similar correspondence dated 23 May 2014 which showed the Respondent’s income as being $2.38 and the Respondent’s husband’s business income as $0.[14] A figure of $4.76 for combined annual income is shown in correspondence on 28 March 2014[15] and $4.16 on 8 December 2015.[16]
[14] Ibid 466 and 470.
[15] Ibid 450.
[16] Ibid 561.
It is the Applicant’s position that the Respondent must have known this was not correct, and hence had an obligation to inform the Department of the correct information. Although the Respondent made it clear that she was not aware of the precise details of the family income at any one time (and that in at least one year her husband’s business had sustained an annual loss), it is hard to gainsay the Applicant’s submission. The Respondent knew her combined family income was above at least $5.00.
Although the AAT1 found that correspondence from Centrelink could be characterised as “conflating information pertaining to different Centrelink payments”,[17] this Tribunal does not so find. The Respondent is clearly a highly intelligent woman who has heroically managed very difficult circumstances with her children and yet has also been able to assist her husband with the management of his business, the details of which were well enough known to her as to be able to recognise errors apparent in Centrelink correspondence related to combined family income.
[17] Ibid 9 [34].
The Respondent’s belief that, by informing Centrelink of relevant details for FTB purposes, such information would be available for and used by the same agency in calculating CP, is more than understandable. The Federal Government goes out of its way to promote the idea of “one-stop” contact with government agencies through the MyGov portal and other initiatives.
While there is some support for this proposition,[18] the weight of authorities is clearly in favour of a finding that social security recipients have an obligation to respond to each of the notifications they receive with specific reference to that piece of correspondence and in relation to the information/ requests contained therein.[19] It is also the case that the 10 October 2013 notice sets out clearly the need to report changes in details of family income and related circumstances.[20]
[18] Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Walsh [2008] AATA 75; Secretary, Department of Employment and Workplace Relations and Taylor [2007] AATA 1377.
[19] Secretary, Department of Education, Employment and Workplace Relations and Brookes [2008] AATA 501; Fisher and Secretary, Department of Education, Employment and Workplace Relations [2008] AATA 410; Tabije and Secretary Department of Social Services [2014] AATA 778 (and the authorities cited therein at [64]); Secretary, Department of Social Services and Waqar (Social services second review) [2020] AATA 1493.
[20] T documents at 407.
There is a parallel for this case in the matter of Jonauskas where the Tribunal stated:
I am satisfied that the initial error in the calculation of Mr Jonauskas’ Age Pension was attributable solely to the administrative error of DSS … The debt continued to be solely attributable to the error of DSS until Mr Jonauskas came under an obligation to advise DSS that it was acting on incorrect information. He came under that obligation once he had received the letter of 22 July, 1997 containing the recipient notification notice requiring him to tell DSS if its statement of his income was correct and once the time for his responding had passed … After that time, the debt was due in part to its own initial error and in part to Mr Jonauskas’ omitting or failing to correct their error.[21]
[21] Secretary, Department of Family and Community Services and Jonauskas [2001] AATA 72, [56].
“Sole administrative error”, like so many critical terms in the Act, is not therein defined. However, judicial authority has established that it is to be given its ordinary meaning and that it is analogous to terms such as “exclusively", "only" or "to the exclusion of all else".[22] In Ward the Tribunal made it clear that if there are any other contributing errors they will vitiate a sole responsibility finding and “[i]t makes no difference that those other errors or factors are minor”.[23]
[22] Gerhardt and Department Employment, Education and Training [1996] AATA 173, [36]; Ryde Municipal Council v Macquarie University (1978) 23 ALR 41, 50-51.
[23] Ward and Secretary, Department of Family and Community Services [2000] AATA 212, [47].

The Parliament has legislated to give a fig leaf of coverage to shield the Department from the embarrassment of exposure to penalty for its administrative errors and the Tribunal is bound to give effect to that decision.
CONCLUSION RE ADMINISTRATIVE ERROR
The Respondent’s failure to respond to any of the correspondence during the debt period, but particularly the section 68 notice of 10 October 2013 so as to correct the manifest and obvious error(s) contained therein, thereby allowing them to continue, means that the Respondent effectively forfeits the right to have the debt waived on the ground of sole administrative error. She contributed, materially, to the error not being corrected.
SPECIAL CIRCUMSTANCES
Section 1237AAD of the Act also provides the circumstances in which the Tribunal may waive the right to recover all or part of a debt:
1237AAD Waiver in special circumstances
The Secretary may waive the right to recover all or part of a debt if the Secretary is 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.
Once again, the Tribunal notes that the term “special circumstances” is undefined within the parameters of the Act itself.
Without going into extensive detail, it can be said that the authorities have identified a number of factors which go to establishing whether or not “special circumstances” exist. They must be:
(a)something more than ordinary or usual[24]
(b)markedly different from the usual run of cases – not necessarily unique but having a particular quality of unusualness[25]
(c)attuned to the individual circumstances of each case[26]
(d)not so rigidly applied as to risk harsh or unreasonable outcomes[27]
(e)supportive of the overall integrity of the social security system and recognising the public interest in ensuring that public moneys are recovered where they can and should be.[28]
[24] Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25; Jess v Scott (1986) 70 ALR 185, 193; Dranichnikov v Centrelink [2003] FCAFC 133, [66].
[25] Re Beadle and Director-General of Social Security (1984) 6 ALD 1, 3.
[26] Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114, [80].
[27] Secretary, Department of Social Security v Hales (1998) 82 FCR 154, 162.
[28] Skinner and Secretary, Department of Social Services (Social services second review) [2015] AATA 569, [48]; Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114, [80].
A starting point in discussion of waiver of debt in special circumstances is to determine whether the debt arose because the debtor “knowingly” made a false statement or representation, or “knowingly” failed or omitted to comply with the requirements of the Act or Administration Act.
In this case those obligations arise under sections 66A(2) and 68(2) of the Administration Act which require that changes in circumstances must be reported to the Department generally and also when notices are sent requiring specific information to be provided.
It is not necessary to discuss this issue in any detail as the Applicant states quite explicitly in her statement of facts, issues and contentions dated 16 June 2020 (Applicant’s SFIC) that the Respondent “did not knowingly fail or omit to comply with her obligations”.[29] The Tribunal endorses this conclusion.
[29] Applicant’s SFIC at [8.71]; Love and Secretary, Department of Social Services (Social services second review) [2016] AATA 8, [57].
Secondly, special circumstances cannot be established simply by arguing that there are matters of financial hardship which, alone, make the burden of repayment intolerable.[30]
[30] Skinner and Secretary, Department of Social Services (Social services second review) [2015] AATA 569, [43].
Thirdly, authority suggests that the correct approach to determining the presence of special circumstances gives the Tribunal “a broad discretion to respond to a wide variety of circumstances”.[31]
[31] Hogan and Secretary, Department of Employment, Education and Workplace Relations [2011] AATA 162, [82].
Classically, the Court in Hales noted that the “concept of special circumstances is broad” and referred to “[a] constellation of factors” which may fall within the definition. It noted that:
The evident purpose of s 1237AAD is to enable a flexible response to the wide range of situations which could give rise to hardship or unfairness in the event of a rigid application of a requirement for recovery of debt.[32]
[32] Secretary, Department of Social Security v Hales (1998) 82 FCR 154, 162.
Parliament would not have included such a provision in the Act, going beyond recovery solely as a result of administrative error, if it did not intend to place this weapon in the armamentarium of a decision maker.
The Tribunal accepts the general description given in the Applicant’s SFIC at [8.82] (citations omitted):
The decision to apply special circumstances should take into account all of the person's circumstances, and would usually be based on a combination of factors. “Special” denotes something different from the usual or ordinary, but it is the circumstances that must be special, not the individual’s experience of them. Circumstances might be special though they apply to more than one person or to a class of persons, provided they are not of universal application.
The Guide includes the following points made to assist decision makers:
·The circumstances must be considered in their entirety.
·Each case must be considered on its own merits.
·The decision to apply special circumstances should take into account all of the person's circumstances and would usually be based on a combination of factors.
·Other factors to consider when determining if special circumstances exist would include, but are not limited to, the physical and emotional state of the person together with their decision-making capacity and financial circumstances, such as family and domestic violence.
·There is nothing in section 1237AAD that limits the broad discretion available to the Secretary under this section of the Act to determine that a person's circumstances are special circumstances that make it desirable to waive the debt.
·Special circumstances are not merely directed to the person's own circumstances. Rather they are directed to those that are 'special enough circumstances … that make it desirable to waive'. That necessarily requires a consideration of the person's individual circumstances but also a consideration of the general administration of the social security system.
·The integrity of the social security system relies on recovery of overpayments. In general, if a person has had the use and advantage of the money paid incorrectly to them and has the means to repay it without excessive hardship (e.g. through withholdings), they should do so. In such a case, special circumstances waiver would be appropriate only if the person's particular circumstances made it unjust for the general rule to apply. Their circumstances would need to distinguish their situation from that of the many other people who do have to repay their debts.[33]
[33] Guides to Social Policy Law – Social Security Guide (Guide) at 6.7.3.40.
There is little guidance as to the public policy behind this section of the Act. Section 1237AAD was introduced into the legislation by passage of the Social Security Legislation Amendment (Carers Pension and Other Measures) Act 1995 (Cth). The Explanatory Memorandum to that legislation states, in relation to the purposes of section 1237AAD, that it was intended to overcome some problems which courts and tribunals had identified in interpreting sections 1237 and 1237A of the 1991 legislation and, inter alia:
The first exception provides that the Secretary will be prevented from exercising the discretion in section 1237AAD where the debt arose either solely or partly because of deliberate fraud by the debtor or another person (see the second criterion above). That is, the discretion may be exercised where a debt arose wholly because of an innocent mistake.
…
Accordingly, the new special circumstances provision can only be used where the debt arose because of an innocent mistake by a social security recipient The rationale for this exception is that it is not considered appropriate to provide relief under section 1237AAD if a debtor has deliberately set out to defraud the Commonwealth.[34]
[34] Explanatory Memorandum, Social Security Legislation Amendment (Carers Pension and Other Measures) Bill 1995 (Cth) at 32.
Special circumstances and administrative error
On several occasions this Tribunal has considered the interrelationship between administrative errors on the part of the Department and the application of the special circumstances provision of the Act.
Mistaken advice or failure to act upon advice provided, by departmental officers, amounting to administrative error has been considered as a special circumstance by this Tribunal in situations where sole administrative error cannot be said to exist.
In Re Gale where it was held that “the applicant and the department were not equal partners in their respective contribution” to the administrative errors which occurred, because “the department was primarily responsible for the administrative error”, the special circumstances provision of the Act could be enlivened to the benefit of a debtor.[35]
[35] Re Gale and Secretary, Department of Employment, Education and Training (1996) 42 ALD 477, [44].
In McAvoy the Tribunal considered that, in relation to circumstances whereby the Department had given misleading advice (albeit in that case over a period of several years):
The responsibility for efficient and effective administration of departmental practice and policy must carry with it a responsibility for any error or mistake which is made by the departmental officers alone.[36]
[36] Re Secretary, Department of Social Security and McAvoy (1996) 44 ALD 721, 730.
On that basis, taking into account all the facts of that case and what the Tribunal described as the “Hales factors”, it was found appropriate to waive a substantial debt (for sole administrative error).
In Brown the Tribunal was concerned with a matter in which there was an overpayment made to the applicant which arose, in part, from the Department’s failure to follow up on information provided by the applicant. The Tribunal took the view that this was a material fact for it to consider in an assessment of special circumstances and noted that, at the same time, the applicant was under a great deal of personal stress and vulnerability which contributed to her failure to respond adequately to departmental correspondence. It held:
… While the Tribunal finds that Mrs Brown contributed to the overpayment in terms of her failure to respond to Departmental notices, the Tribunal also determines that the overpayment arose because of the failure of the Department of Social Security in particular to follow its own procedures and to investigate information provided to it not only by Mrs Brown, but also by the Department of Veterans' Affairs. Accordingly, the Tribunal considers that the Departmental administrative error in this case is a special circumstance which should be taken into account in terms of the manner in which the debt arose.
…
The Tribunal further finds that there is a special circumstance in relation to the occurrence of this overpayment which relates to the fact that Mrs Brown was completing claim forms and reading correspondence from various Commonwealth agencies at a time of great distress and increased vulnerability. In these circumstances, it is likely that Mrs Brown was not fully aware or providing full concentration to the matters being presented to her in relation to her financial security …
… The Tribunal determines that $10,000 of the outstanding debt should be waived to reflect the special circumstances of Mrs Brown's case including the Departmental administrative error, the circumstances of her recent bereavement and her inability to deal with the administrative requirements in her quest to secure her future financial position.[37]
[37] Brown and Department of Family and Community Services [1999] AATA 113, [82], [85] and [87].
In Nehma the Tribunal again considered a case where the Department had given incorrect advice to the applicant and where it had failed to apply the law relevant to the particular circumstances of the case. Despite this the applicant had contributed to the circumstances in which overpayments had been made and hence no “sole” administrative error could be found. It also found that there was nothing special in relation to that applicant’s financial circumstances, indeed she was “in a much better position than most Social Security beneficiaries and, accordingly, financial hardship is not a special circumstance in this case”.[38]
[38] Nehma and Department of Family and Community Services [1999] AATA 219, [74].
The Tribunal went on:
The Tribunal is concerned at the significant Departmental error in this matter. Not only was the law not correctly applied, the Department's own policy, procedures and practices also were not applied.[39]
[39] Ibid [76].
It may be said in this present matter that there was, at least initially, a failure of the Department to apply the law correctly in terms of its calculations of payments taking into account the information provided to it by the Respondent.
The Tribunal in Nehma then concluded:
In all the circumstances and in the facts of this particular case, the Tribunal finds that there are special circumstances in this matter which arise as a result of Departmental administrative error. Mrs Nehma was given incorrect advice by the Department in relation to her mother's claim and subsequent receipt of Job Search Allowance. The Department also failed to apply section 517A of the Act. Further error occurred when the Department failed to apply its own policies and procedures in relation to review and statements of debt provided to assurers. Accordingly, the Tribunal finds that the debt owed by Mrs Nehma should be waived either as a whole or in part pursuant to section 1237AAD of the Act. The remaining issue for the Tribunal is the extent to which the debt should be waived.[40]
[40] Nehma and Department of Family and Community Services [1999] AATA 219, [75].
In Brittain the Tribunal considered an application for special circumstances waiver in which it agreed that:
Whilst the applicant is not blameless, given the Tribunal's finding that she failed to notify and was provided with a basic degree of information in the letters she received…[41]
[41] Brittain and Secretary, Department of Family and Community Services [2000] AATA 161, [44].
Nevertheless, it went on, considering all the circumstances:
The Tribunal considers that the departmental error in this case is significant such that whilst not being solely responsible for the debt, it should be considered to be a special circumstance.[42]
[42] Ibid [43].
In submissions on behalf of the Respondent it was argued that the Tribunal should take account of the role of administrative error (which was not sole administrative error) in its determination of whether or not there were special circumstances in this case.[43]
[43] Transcript dated 27 November 2020 (Transcript) at 65 [40]-[46].
The Tribunal is so persuaded and has done so.
Special circumstances: The Respondent
What then are the particular circumstances in Mrs Clark’s case which might be unusual or out of the ordinary so as to qualify as “special”?
In the first place she has care and responsibility for two children each of whom suffer from a range of difficulties.[44] One of her children suffers with a significant degree of autism which makes him often extremely difficult to manage and occasionally violent with members of the family. He lacks impulse control and, despite now being some ten years of age, often seeks the comfort of his parent’s bed, much to their distress and disruption.[45] He is just entering puberty and the family expect the management of his requirements to get significantly more onerous and burdensome.
[44] Transcript at 7 [25] – 11 [7].
[45] The Respondent filed reports providing relevant information including a letter of Dr Chanka Nanayakkara dated 25 October 2018, letter of Dr Vanessa Cairns dated 18 June 2019, and psychological report by Dr Lee Sturgeon dated 14 January 2019.
Another child was born with a congenital defect affecting her leg which has required repeated surgery and prolonged stays in Westmead Children’s Hospital which is several hours drive from the family home. Her condition is such that there is a risk of the loss of her leg at some later stage of her life. The child has also developed some self-harming practices and requires supervision in this regard.[46]
[46] The Respondent gave evidence to the Tribunal regarding this matter which was unchallenged by the Applicant.
The Respondent herself suffers from a range of medical conditions. She has suffered hormonal problems requiring bariatric surgery, nephritis, arthritis in both hips, a level of fibromyalgia, bulging spinal disc problems (requiring cortisone injections), some indications of cystic fibrosis and has a growth behind her left eye.[47] She suffers migraines and takes significant doses of non-opioid painkillers and has recently been treated for shingles.[48] She told the Tribunal that her toenails had fallen off. She has been diagnosed as suffering from depression and anxiety, and is attempting to comply with a prescribed Mental Health Plan.[49]
[47] The Respondent gave evidence to the Tribunal regarding this matter which was unchallenged by the Applicant.
[48] Letter of Dr Smita Gupta dated 4 September 2020.
[49] Letter of Ms Karen Watson dated 11 November 2020 (Watson letter); Transcript at 12 [31] – 13 [26] and 48 [10] – 49 [2].
Medical evidence was before the Tribunal in relation to the Respondent’s son’s condition and to some of the Respondent’s claimed conditions, including the mental health diagnosis, with the other matters being before the Tribunal on the basis of her sworn testimony, which the Tribunal has no difficulty in accepting.
The Applicant presses the case that the Respondent’s health conditions are not unique or so special such as to distinguish them from other people suffering ill health. Equally, the Applicant presses that the circumstances related to the care of RJ are not materially different from those which would be faced by other recipients of CP in respect of a child with similar conditions. In her submissions no specific reference has been made to the health condition of the other dependent child, nor that of the Respondent herself, let alone the overall assessment of the health status of the family unit.
What is of course “special”, although not necessarily “unique”, is that there has been a degree of administrative error by the Department and the Tribunal accepts that this has contributed to placing the Respondent under additional strain and further impacting on her mental health because she has had to deal with the consequences of such an error (see supra).
In Groth (a case on “special circumstances” and section 1184 of the Act) Kiefel J (as Her Honour then was), after referring to the Federal Court’s decision in Beadle v Director-General of Social Security (1985) 7 ALD 670, observed that special circumstances:
… would require something to distinguish Mr Groth’s case from others, to take it out of the usual or ordinary case … It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.[50]
[50] Groth v Secretary, Department of Social Security (1995) 40 ALD 541, [545].

The administrative error on the part of the Department passes muster with the Tribunal as “unintended” and probably also “unfair” and “unjust” in its impact on the Respondent.
It is not inappropriate to have consideration of the mental and physical health of people in a position akin to the Respondent. The report from clinical psychologist Karen Watson states that:
Cassandra has presented as highly anxious and has become distressed at times during sessions. She has reported a complex family history and trauma background and ongoing symptoms of anxiety, depression, and panic attacks. Cassandra has indicated onset of anxiety in childhood and recent escalation of symptoms related to family stress. Cassandra's assessment results and presentation during sessions have been consistent with Dr Reyes Castillo's referral and diagnosis. It is my clinical opinion that Cassandra currently meets diagnostic criteria for Persistent Depressive Disorder and Generalised Anxiety Disorder. Assessment in relation to possible bipolar disorder diagnosis are currently ongoing. Cassandra's diagnosis will provide significant challenges when managing high levels of family and occupational stress.[51]
[51] Watson letter.
The Respondent is participating in a Mental Health Plan developed between her and Dr Alicia Reyes Castillo.[52]
[52] Letter of Dr Alicia Reyes Castillo dated 2 September 2020.
In Balancio the Tribunal noted that the applicant in that case:
had been diagnosed with major depressive disorder, which would, in the Tribunal’s view, have affected her capacity to fully understand the obligations required of her …
The tribunal is satisfied that the combination of the state of health of Ms Balancio, together with her serious financial circumstances, make it appropriate to waive the debt in this case.[53]
[53] Balancio v Secretary, Department of Family and Community Services (2003) 74 ALD 204, 209-210.
Einfeld J in Thompson remarked that it was not outside the scope for the Tribunal “to consider the general factors such as the mental health … of the individual”.[54]
[54] Secretary, Department of Social Securityv Thompson (1994) 36 ALD 563, 568.
In Dean the Tribunal surveyed the numerous cases where special circumstances had been found based upon consideration of the mental health of the individuals concerned.[55]
[55] Dean and Department of Education, Science and Training [2005] AATA 586, [60].
In Perkich the Tribunal took account of the fact that the applicant’s physical and mental health, and social circumstances, “have been precarious”.[56]
[56] Perkich and Secretary, Department of Social Security (1997) 49 ALD 137, 151.
The need to incorporate an understanding of the individual’s mental and physical health within a “holistic perspective”[57] has been recognised in many decisions on special circumstances, which is consistent with:
a broad discretion to meet the great variety of circumstances which must occur, raising considerations of individual hardship, need, fairness, reasonableness, and whatever else may move an administrator, keeping in mind the scope and purpose of the Act, to make a decision one way or the other.[58]
[57] Lind and Secretary, Department of Social Services [2014] AATA 680, [48].
[58] Riddell v Secretary, Department of Social Security (1993) 30 ALD 31, 38.
The Tribunal is aware that the discretion in this area is “not lightly to be enlivened”,[59] that at its core is the element of something being “out of the ordinary course”[60] but that such a finding does not have to reflect only that which is “extremely unusual, uncommon or exceptional”.[61]
[59] Boscolo v Secretary, Department of Social Security (1999) 53 ALD 277, 281.
[60] Minister for Community Services and Health v Chee Keong Thoo (1988) 78 ALR 307, 324.
[61] Secretary, Department of Social Services v Hodgson (1992) 27 ALD 309, 318.
Although the Tribunal has found that the administrative error was not solely responsible for the debt arising, it nevertheless notes the comments of Senior Member Handley in McAvoy:
Any failure to regard the seriousness of the consequences of the giving of wrong advice as not being a circumstance special to the person or persons who have suffered as a result of that advice would be cruel. Citizens are entitled to act upon the advice given to them by representatives of government through its departments and agencies. Citizens also are entitled to have confidence in the advice that they are given by persons in authority and who represent government departments and agencies. Citizens should be entitled to expect nothing less.[62]
CONCLUSION RE SPECIAL CIRCUMSTANCES
[62] Re Secretary, Department of Social Security and McAvoy (1996) 44 ALD 721, 729.
The administrative error amounts, in this instance, to the equivalent of “wrong advice” and hence should not be disregarded. As discussed above, the Tribunal accepts that administrative error on the part of the Department may be taken into account as a contributing factor to establish the unusual or special qualities of a case which sets it apart from others.
The Tribunal accepts that there is a significant public policy interest in maintaining the integrity of the whole social security system and making sure that people are not paid above their entitlement, nor rewarded by having significant access to public finds to which they were not entitled.[63]
[63] Secretary, Department of Employment and Workplace Relations and Bilgin [2007] AATA 1167, [18]; Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Walsh [2008] AATA 75, [47].
However, the Tribunal’s assessment of the Respondent’s holistic situation and the “constellation” of factors to be taken into account enliven the legitimate exercise of discretion provided by the Act and support a conclusion that special circumstances exist in this case.
Discussion
The Applicant has identified three elements in the waiver provision of section 1237AAD.[64] The Applicant has, itself, acknowledged that the first element (“knowingly”) does not act as a barrier to the Respondent’s claim for waiver, and in relation to the second element the Tribunal has found that “special circumstances” exist.
[64] Applicant’s SFIC at [8.69]-[8.101].
The third element is the discretion to decide whether it is more appropriate for a debt to be waived or written off (section 1237AAD(c)). Debts written off (section 1236) are not extinguished. They may be reversed and recovery proceedings may be instituted at some later stage where circumstances change as discussed above.[65]
[65] Guide at 6.7.3.10.
Debts which are waived are taken to have been eliminated such that they cannot be restored at some time in the future. Such a course of action may be taken under section 1237AAD.
The prospect of a significant change in the Respondent’s circumstances appear limited in respect to her ongoing health problems and mental health issues, compounded by her son’s continuing medical conditions and daughter’s poor physical and mental health condition. Although, the Tribunal recognises that her own Mental Health Plan suggests that there may be “progress” for her personally.
As such, it would be more appropriate to waive rather than write off the debt in this case.
DECISION
The decision under review is set aside and in substitution it is decided that:
(a)the debt for the period 13 September 2013 to 9 October 2013 is waived in its entirety pursuant to section 1237A of the Act; and
(b)the debt for the period 10 October 2013 to 5 October 2018 is waived in its entirety pursuant to section 1237AAD of the Act.

I certify that the preceding 95 (ninety-five) paragraphs are a true copy of the reasons for the decision herein of Chris Puplick AM, Senior Member

................................[sgd]................................
Associate
Dated: 11 January 2021

Date(s) of hearing: 27 November 2020

Solicitors for the Applicant: Dr S Thompson, Services Australia

Solicitors for the Respondent: Ms K Boyle, Welfare Rights Centre

Date(s) of hearing:	27 November 2020
Solicitors for the Applicant:	Dr S Thompson, Services Australia
Solicitors for the Respondent:	Ms K Boyle, Welfare Rights Centre