Cowan and Anor and Secretary, Department of Families, Community Services and Indigenous Affairs

[2007] AATA 1473

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1473

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q 2006/884;
  )          Q 2006/885

GENERAL ADMINISTRATIVE  DIVISION		)
Re		Jeffrey Cowan and Anita Petrie

Applicants

And Secretary, Department of Families, Community Services and Indigenous Affairs

Respondent

DECISION

Tribunal  Senior Member Bernard J McCabe

Date 27 June 2007

Place Brisbane

Decision  The decision under review is set aside. The Tribunal decides in substitution that the applicants should be paid at the single rate of the age pension from the date of the original decision.

...................[Sgd]..................

SENIOR MEMBER

CATCHWORDS

SOCIAL SECURITY – age pension – rate of payment varied to the lower partnered rate – incorrect rate of payment – review was sought out of time – recovery not allowed beyond 13 week period – question of notice of decision to vary payment – whether adequate notice was given – what constitutes notice that a decision had been made – no proper notice given – decision under review set aside

Social Security (Administration) Act 1999 s 109

Austin v Secretary, Department of Family and Community Services [1999] FCA 938

Secretary, Department of family and Community Services v Rogers [2000] FCA 1447

Secretary, Department of Family and Community Services [2003] AATA 1300

Secretary, Department of Family and Community Services and Garforth-Dankmeyer [2006] AATA 166

Secretary, Department of Employment and Workplace Relations and Spinapolice [2006] AATA 191

REASONS FOR DECISION

27 June 2007	Senior Member B J McCabe
introduction

1. The applicants were both in receipt of the aged pension paid at the single rate. Centrelink mistakenly decided to change their payments: it started to pay them as if they were a couple. Letters were sent to the applicants advising them of the new rates of payment during 2004 but Centrelink’s mistake was not discovered until some time later. The applicants now want the money they should have been paid during that period. But there is a problem: s 109 of the Social Security (Administration) Act 1999 (the Act) limits the right of welfare recipients to recover arrears of payments where a mistake has been made in relation to their entitlements. If a valid notice informing the applicants of the decision in question was issued but there was no appeal within 13 weeks, the applicant may only recover arrears from the point at which he or she sought a review. The earlier arrears are forfeited in those circumstances.

2. The applicants say they did not receive a proper notice in 2004. They say they are therefore entitled to rely on s 109(3), which permits them to recover arrears from the date of the original decision.

3.      This case turns on the question of whether or not a notice of the original decision within the meaning of s 109(3) of the Act was provided to the applicants.

the material before tre tribunal

4. The Tribunal was provided with the documents required by s 37 of the Administrative Appeals Tribunal Act 1975. Mr Hamilton, a Centrelink advocate, appeared for the respondent. Mr Cowan was represented at the hearing by Mr Cousins of Legal Aid Queensland. Mr Cowan listened to the hearing on the telephone. Mrs Petrie was not formally represented by Mr Cousins, but I spoke to her about her case on the telephone. (Mr Cowan was with her and handed her the phone for that purpose.) She said she was happy to rely on the written material before the Tribunal and whatever Mr Cousins said on behalf of Mr Cowan. While I had some discomfort at the prospect of proceeding in her absence, she insisted she was content with that course. I spoke with her at the end of the hearing and explained the arguments that Mr Cousins had advanced and she repeated she was happy with what had been said.

factual background to the dispute

5.      The parties agreed the factual findings of the Social Security Appeals Tribunal (the SSAT) were accurate subject to one qualification: the applicants say the letters they received from Centrelink did not make clear they were to be paid at the partnered rate. I will have more to say about those letters in due course. I otherwise accept the findings of the SSAT on questions of fact. The summary which follows is intended for the reader who does not have access to that decision.

6.      Mr Cowan has acted as a carer for Mrs Petrie for a number of years. She is visually impaired. Both of them were (and are) in receipt of the aged pension. They were not at any relevant time involved in a relationship that would result in them being treated as a couple for the purposes of the aged pension. As a result, they were each paid a pension at the single rate. The single rate is higher than the rate paid to members of a couple.

7.      Mr Cowan decided to travel around Australia in 2004. He invited Mrs Petrie to accompany him. Before they left, they visited the Centrelink office in Grafton. They told Centrelink of their plans. Mr Hamilton said one of the officers mentioned Mr Cowan and Mrs Petrie might be paid at the partnered rate because they were travelling together. That part of the story is unclear. Mr Hamilton accepted the applicants did not understand the import of the comment, if it was in fact made.

8.      Centrelink officers appear to have arranged for the applicants to be paid at the partnered rate from that point. Each of the applicants subsequently received a letter from Centrelink in similar terms. Each of the letters advised the recipient of the rate of age pension they were to receive. The letters did not say a decision had been made to change the rate of pension, nor did the letters expressly state a decision had been made to pay the applicants at the partnered rate instead of the single rate. Each of the letters dated 19 July 2004 (document T10 in exhibits one and two) includes a heading that reads “Information used for calculating your regular payment”. There is a reference under that heading to “combined annual income” of $11807.90 (in the case of Mr Cowan) and $11913.46 (in the case of Mrs Petrie). The balance of the letters includes a list of matters that must be disclosed to Centrelink. Each of the letters refers to changes that include changes in the circumstances of the recipient’s partner.  

9.      The applicants subsequently received several letters from Centrelink alerting them to changes in the amount they were to receive. None of the letters expressly referred to payments being made at the partnered rate. The letters also referred to the need to advise of changes in a partners’ circumstances or the status of the relationship with the partner.

10. The applicants did not become aware of the error until 2006. They requested a review of the decision on 31 March 2006. Centrelink acknowledged the error but said it could not pay arrears for the whole of the period during which the applicants were paid the wrong amount because of s 109 of the Act. On appeal, the SSAT required that some additional payments be made, but otherwise affirmed the decision. I note the SSAT accepted the letters written on 19 July 2004 constituted valid notice, although I understand the applicants did not argue to the contrary at the SSAT hearing.

the legislation

11. Section 109 of the Act sets out the rules which determine the date on which a favourable determination following a review is to take effect. If notice of the decision is given and the appeal is lodged within 13 weeks of receiving notice of the original decision, the favourable determination (if the appeal is successful) is back-dated to the date of the original decision: s 109(1). If the appeal is lodged more than 13 weeks after notice was received, the favourable determination on appeal takes effect from the date of the lodgement of the appeal: s 109(2). If no notice was given, the favourable determination is backdated to the date of the original decision: s 109(3). It follows it is vitally important to consider what amounts to valid notice for the purposes of the Act.

notice

12.     The respondent says all of the relevant information has been provided in the correspondence sent to the applicants. The applicants disagree. They say the letters do not constitute valid notice.

13.     I was referred in particular to Austin v Secretary, Department of Family and Community Services [1999] FCA 938 and Secretary, Department of family and Community Services v Rogers [2000] FCA 1447. Those authorities have subsequently been considered and applied in a number of Tribunal decisions, including Peura and Secretary, Department of Family and Community Services [2003] AATA 1123, Secretary, Department of Family and Community Services [2003] AATA 1300, Secretary, Department of Family and Community Services and Garforth-Dankmeyer [2006] AATA 166, and Secretary, Department of Employment and Workplace Relations and Spinapolice [2006] AATA 191. I found the decision of Deputy President Jarvis in Peura to be particularly helpful in the circumstances of this case.

14.     Drummond J said in Austin (at [35]) a valid notice required a clear statement by the respondent that a decision had been made “as opposed to information from which an inference to one or other of those effects might be drawn…”. His Honour went on to point out that merely informing a recipient of a changed rate of payment without linking it to a decision was notice of the result or effect of a decision, but not notice of the decision itself.

15.     Cooper J followed a similar approach in Rogers. His Honour observed (at [33]) that a valid decision must refer to the fact of a decision being made and the contents or effect of that decision. His Honour agreed it was unnecessary to set out the reasons for the decision.

16.     The letters in this case do not expressly refer to a decision having been made by the respondent to reduce their payments. They merely report the effect of the decision, ie, the revised rates of payment. There are hints at the decision contained in the portions of the letter informing the applicants of their reporting obligations, but I do not think they are enough by themselves to bring home to the reasonable reader the fact a decision has been made. As Dummond J observed in Austin (at [35]), the recipient of the notice is entitled to a degree of clarity so he or she knows where he or she stands.

conclusion

17. The decision under review is set aside. The applicants did not receive valid notice of the original decision. The determination of the appeal in their favour takes effect as at the date of the original decision pursuant to s 109(3) of the Act.

I certify that the 17 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member Bernard J McCabe.

Signed:         ............................[Sgd].......................................
  Associate      Stephen O’Grady

Date of Hearing  4 April 2007
Date of Decision  27 June 2007
The applicant Mr Cowan was represented by Mr Cousins.
The applicant Ms Petrie represented herself at the hearing.

The respondent was represented by Mr Hamilton, a departmental advocate.