De Silva and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2008] AATA 132

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 132

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/0771

GENERAL  ADMINISTRATIVE  DIVISION		)
Re		HARINDRA DE SILVA

Applicant

And

SECRETARY,

DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS 

Respondent

DECISION

Tribunal Dr R. McRae, Member

Date20 February 2008

PlaceMelbourne

Decision The Tribunal affirms the decision under review.

(sgd) R. McRae

Member

SOCIAL SECURITY – family payment – absence from Australia – family allowance obligations - family tax benefit - whether qualified as an Australian resident - whether recoverable debts to the Commonwealth

Administrative Appeals Tribunal Act 1975 sA New Tax System (Family Assistance) Act 1999 ss 3(1), 21(1)

A New Tax System (Family Assistance) (Administration) Act 1999 ss 97(1), (2), 101

Social Security Act 1991 ss 7(2), 1223(1), 1236, 1237A, 1237AAD

Angelakos v Secretary, Department of Employment & Workplace Relations [2007] FCA 25

Dranichnikov v Centrelink (2003) 75 ALD 134

Groth v Secretary, Department of Social Security (1995) 40 ALD 541

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126

REASONS FOR DECISION

20 February 2008 Dr R. McRae, Member       

1.      On 2 September 1991 Mr Harindra de Silva (the Applicant) submitted a claim for family payments (family payment (FP) and sole parent pension (SPP)) under the Social Security Act 1991 (the Act) to Centrelink.  Centrelink acts as the service delivery agency for the Secretary to the Department of Families, Housing, Community Services and Indigenous Affairs (the Respondent).  The Applicant received FP from 6 September 1991.  In July 2000, FP was replaced with family tax benefit (FTB).

2.      On 8 May 2006 a Centrelink officer decided that the Applicant had been overpaid FTB and, as a result, owed six debts to the Commonwealth totalling $33,933.37.  The Applicant requested a review of this decision, and on 11 July 2006 the Applicant was advised the decision was correct.  The Applicant sought review of this decision and an authorised review officer of Centrelink (ARO) affirmed the decision on 22 August 2006.  The Applicant then sought review of the ARO’s decision by the Social Security Appeals Tribunal (SSAT) on 5 December 2006 (the application form was dated 26 November 2006).  The SSAT affirmed the decision on 7 February 2007.  This decision is the subject of the application to this Tribunal. 

3.      The issues for the Tribunal are whether the Applicant has incurred an FTB debt between 1 July 2000 and 10 February 2006; and if a debt has been incurred, is it a recoverable debt to the Commonwealth? 

4.      The Tribunal’s decision is that a debt applies to the Applicant from 1 July 2000 to 10 February 2006, and the debt is recoverable by the Commonwealth.  

5. The Applicant advised the Tribunal that he was unable to travel to Australia to appear before the Tribunal. In the circumstances, it appeared to the Tribunal that the issues for determination on the review of the decision could be adequately determined in the absence of the parties. The Respondent consented to the review being determined without a hearing. Therefore, pursuant to s 34J of the Administrative Appeals Tribunal Act 1975, the Tribunal proceeded to review the decision by considering the documents or other material lodged with or provided to the Tribunal without holding a hearing. The Tribunal had before it documents lodged by the Respondent pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (the T Documents).

BACKGROUND

6.      The Applicant is a 57-year old Sri Lankan widower, who lives in Sri Lanka with his son, who was born in Sri Lanka on 11 February 1990.  He has a current annual income equivalent to $6,510 (T29, p92).  He came to Australia on 5 January 1991.  He was living in Melbourne at the time of his wife’s death from cancer on 21 August 1991.  He returned to Sri Lanka with his son in October 1991 to fulfil religious and cultural requirements following the death of his wife. 

7.      In his claim form for FP the Applicant indicated he had permission to stay permanently in Australia, but did not indicate whether he intended to reside permanently in Australia.  The claim form did not identify a requirement for an interpreter or a language that he spoke.  He received his social security payments of sole parent pension (SPP) and FP into a suburban Melbourne branch of the Commonwealth Bank of Australia account although his postal address was in Sri Lanka from October 1991. 

8.      On 4 February 1992 the Applicant hand-wrote to Centrelink advising his return to Australia would be delayed to 31 July 1992: no reason was stated other than unforeseen circumstances (T6, p33).  Centrelink received the letter on 13 February 1992. On 12 June 1992 he wrote to Centrelink again, reiterating the earlier advice, and returning the Review of Family Allowance form as I feel that this form is not relevant to me at the moment.  This letter contained a grammatical error at the point he attempted to identify the proposed date of his return, but included 1992 as the year of his return (T7, p34).  On 27 August 1992 he wrote to Centrelink again, advising that his return to Australia would be delayed until 31 December 1992 due to unavoidable circumstances (T8, p35). Centrelink received this letter on 10 September 1992.  Centrelink sent a letter dated 15 October 1992 advising the Applicant that his SPP would be cancelled in October 1992 as he had been overseas for over 12 months (T9).  He responded on 6 November 1992 (received 19 November 1992), seeking a review of the cancellation and identifying unavoidable circumstances delaying his return until late February 1993 (T10).  During this period the Applicant received six-monthly correspondence from Centrelink, addressed to Colombo, Sri Lanka, relating to reporting obligations for Family Assistance.  All the letters included the advice that It is important that you read the back of this letter to find out about other things you need to tell us about.  All the letters also included advice to tell us within 14 days after any of the following things happen… .  An event listed was You must tell us if you leave Australia, even for a short time.  After 2 December 1995 Centrelink also advised that (T14, p47) You must tell us if the Government tells you that you or any of your dependants cannot stay permanently in Australia. 

9.      The Applicant remained in Sri Lanka except for a short return to Australia from 2 to 15 November 1997.  The Applicant applied for a temporary tourist visa (subclass 676) on 4 September 1997.  This visa was issued on 5 September 1997 with an end date of 4 September 1998.  The Applicant informed Centrelink about the travel to Australia. 

10.     On 24 June 2000 Centrelink sent the Applicant a letter about FTB.  This letter included the advice that You must tell us if you cease to be an Australian resident and You must tell us if your FTB child ceases to be an Australian resident (T19, p60-61).  Centrelink sent similar letters relating to FTB notification obligations  annually thereafter.  The Applicant wrote on 7 June 2005 that he had not received his expected form to update his 2005/2006 income estimate. 

11.     From 1 July 2000 the Applicant’s family payments were replaced by FTB.  The Family Assistance Office (FAO) advised him in a letter dated 6 February 2006 of the cancellation of his family assistance from 15 February 2006 due to his failure to return a review of family tax benefit for child turning 16 form (T30, p93). 

APPLICANT’S CASE

12.     The Applicant’s case is that the debts arose due to an administrative error in the FAO.  He contends he has a limited knowledge of English, with Sinhalese being his primary language.  He answered all letters and questionnaires he received with his limited English comprehension.  At the time of his departure in October 1991 he had intended to remain in Sri Lanka for only a short time.  He had no ability to access information about the Social Security Act 1991 or the A New Tax System (Family Assistance) Act 1999.  While the SPP was stopped after 12 months continuous absence from Australia, the FAO did not stop his family allowance after three years continuous absence in October 1994, and failed to advise him of the conditions under which the payments were received.  All correspondence was to his Sri Lankan address. 

13.     The Applicant considered that he ceased to be an Australian resident from 15 October 1991 (T50, p250), and that he had informed Social Security of this.  He was not advised of the duration of any payments if he remained overseas.  His first knowledge of the three year continuous absence entitlement to FTB was upon receipt of the ARO’s letter dated 17 October 2006 (T47, p241-242).  He believed that the criterion was that he became a sole parent while residing in Australia and that payments would continue until completion of his son’s secondary education.  He received a letter dated 23 February 2002 (although variously referred to as dated 23 March (p166) and 11 February (p76)) from Centrelink and a child support assessment form which he completed and returned.  The Applicant completed an FTB questionnaire in March 2002 which explained the changes and returned it to the FAO.  He completed and returned annual income assessment forms.  He informed the Social Security of my coming to Australia by my letter dated 20.10.97 in November 1997 (T50, p251).  He contends that he has not wilfully failed to divulge information that has been requested.

RESPONDENT’S CASE

14.     The Respondent’s case is that the Applicant received correspondence in the form of recipient notices dated 2 December 1995, 1 December 1997, 7 December 1998, 6 December 1999, and 31 December 1999 stating he must advise if the government tells you that you or any of your dependants cannot stay permanently in Australia.  The Applicant received correspondence in the form of recipient notices dated 24 June 2000, 29 June 2001, 28 June 2002 and 11 February 2003 from the FAO advising him of the basis of his FTB payments as well as the requirements in order to retain FTB payments.  He failed to advise the FAO within 14 days of ceasing to be an Australian resident as advised in each of the recipient notice letters.  He was not entitled to receive the payments that were paid to him.  He thus owes a debt to the Commonwealth, which is a recoverable debt. 

LEGISLATION

15.     The relevant sections in the A New Tax System (Family Assistance) Act 1991 (the Family Assistance Act) are as follows:

21  When an individual is eligible for family tax benefit in normal circumstances

(1)An individual is eligible for family tax benefit if:

(b)the individual:

(i)    is an Australian resident; or

(ia)  is a special category visa holder residing in Australia; or

…

16.     The relevant sections in the Social Security Act 1999 (the SS Act) are as follows:

7(2)     An Australian resident is a person who:
          (a)       resides in Australia; and
          (b)       is one of the following:

(i)        an Australian citizen;

(ii)       the holder of a permanent visa;

(iii)      a special category visa holder who is a protected SCV holder.

Note:    For holder and permanent visa see subsection (1)

1223  Debts arising from … overpayment etc.

1223(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.

1236  Secretary may write off debt

1236(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.

1236(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

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

1237A  Waiver of debt arising from error

Administrative error

1237A(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).

1237A(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.

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.

CONSIDERATIONS

17. Under s 21 of the Family Assistance Act to be entitled to FTB a person must be an Australian resident as defined in s7(2) of the Act as residing in Australia and is i) an Australian citizen; or ii) the holder of a permanent visa; or iii) a special category visa holder who is a protected SCV holder.

Notification issue

18.     The letters sent to the Applicant appear to have been received and understood.  When an anticipated letter was not received, it was requested.  The Applicant’s letters are hand-written, and appear to have been written by the signatory.  Their grammatical construction suggests the Applicant possesses significant education and comprehension of English, or at worst, possesses access to a person with such capability. 

19.     The Applicant considers he ceased to be an Australian resident when he departed Australia on 15 October 1991.  At that time he was advising any staff with whom he had contact that he was departing on a short duration visit to Sri Lanka with an intended return to Australia.  There would be no reason for any staff to advise him of a 12 month (SPP) or 3 year (FA) continuous absence provision. 

20.     There is no evidence the Applicant’s letter dated 20 October 1997 advising Centrelink of his visit to Australia was received by the department.  Its date of composition cannot be validated.  He states he wrote this letter as a consequence of previous correspondence advising …You must tell us if you leave Australia even for a short time.  It appears odd that he wrote this letter related to the leave Australia for a short time advice, when he was ostensibly leaving after a short visit to Australia to return to Sri Lanka for what would generally be regarded as a long time by most people.  This letter does not contain the necessary specific information required by the 2 December 1995, 1 December 1997, 7 December 1998, 6 December 1999 and 31 December 1999 notification letters related to … advis[ing] within 14 days if the Government tells you that you or any of your dependants cannot stay permanently in Australia. 

debt waiver issue

21. Section 1236 of the Act provides for the circumstances under which the Secretary may write off a debt. At least one of the specific prerequisites provided for in s 1236(1A) of the Act must exist. There is no evidence that the prerequisite conditions in s 1236(1A) exist. Thus s 1236 does not apply.

22. Section 1237A(1) of the Act provides that the Secretary must waive debt recovery where the debt is solely attributable to an administrative error by the Commonwealth. Section 1237A(1A) provides that s1237A(1) applies only if the debt was not raised within a period of six weeks from the first payment that caused the debt. This is the circumstances that have occurred, so s 1237A(1) may apply.

23.     While there is a contribution of departmental error in that the FAO was not notified of the Applicant’s departure date, there is no evidence of sole administrative error by Centrelink.  Selway J in Sekhon v Secretary of the Department of Family and Community Services (2003) 132 FCR 126 stated at :

[35]… The words 'a debt attributable solely to an administrative error' can be paraphrased as meaning that the only cause that objectively can be ascribed to the relevant debt is an administrative error…. (emphasis added)

24. Section 1237A(1) of the Act therefore does not apply. The Tribunal notes that consideration of whether the payments were received in good faith is consequently not necessary. 

25.     Section 1237AAA of the Act which provides for waiver of a small debt does not apply through operation of s 1237AAA(1)(a).  The debt is not less than $200. 

26. With respect to the debt waiver provisions of s 1237AAD of the Act, there is insufficient evidence related to whether the Applicant did not knowingly fail to comply with a provision of the Act (s 1237AAD(a)).  There is evidence he received advice as to what he ought to do.  He submits that he complied to the best of his capability and comprehension.  He declared only foreign income in his FTB estimates of income.  This is of no great importance as the requirements of the section are conjunctive. 

27. Section 1237AAD(b) of the Act provides for debt waiver if there are special circumstances … that make it desirable to waive [the debt].  The Administrative Appeals Tribunal stated in Re Beadle v Director-General of Social Security (1984) 6 ALD 1 at 3], …

An expression such as “special circumstances” is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional.

The Tribunal highlighted the context in which [the circumstances] occur.  The Full Federal Court considered Beadle and did not subsequently affirm the words unusual, uncommon or exceptional. 

28.     Kiefel J in Groth v Secretary, Department of Social Security (1995) 40 ALD 541 at 545 considered 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 … follow that if … something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.

Besanko J in Angelakos v Secretary, Department of Employment & Workplace Relations [2007] FCA 25 [33] stated that:

… the test will be overstated if the word ‘exceptional’ is emphasised… less risk of overstatement if the words ‘unusual’ or ‘uncommon are emphasised…there must be something that distinguishes the case from the ordinary or usual case…close attention must be given to the …context. 

Hill J in Dranichnikov v Centrelink [2002] FCAFC 133 [66] stated that:

…To some extent the question whether there were special circumstances must depend on how it came about that the error occurred. 

29.     It is plausible that every Applicant would consider their circumstances to fall within the boundary of being special.  It is conceivable a person could misunderstand the statement …You must tell us if you leave Australia if the person has already left Australia and the correspondence is addressed to that person in another country.  It is less conceivable that a person can misunderstand the direction …You must tell us if the Government tells you that you or any of your dependants cannot stay permanently in Australia, particularly when a person has had a visa with an expiry date issued to them.  If a payment is ceased due to continuous absence, it is reasonable to assume that a person would turn their mind to this possibility applying to other payments and making an enquiry.  There is no evidence of the basis for the Applicant’s opinion that he was entitled to the FTB payment because he became a sole parent while residing in Melbourne and that it would be paid until his son completed his secondary education.  This belief is the basis of his submission in support of the existence of special circumstances.  

FINDINGS

30.     The Applicant is a widower who departed Australia on 15 October 1991.  He was an Australian resident up to that date.  When he departed, he and any person with whom he spoke or corresponded with at Centrelink considered the departure was short term, and certainly less than 12 months.  There was no reason for any person at Centrelink to specifically advise the Applicant of continuous absence provisions related to any payment he was receiving.  He has reasonable comprehension of English, and at no time advised of any difficulty with English comprehension.  He has maintained a copy of salient correspondence. 

31.     The Applicant received FTB from 1 July 2000 to 10 February 2006. 

32.     The letter sent regarding cancellation of SPP confirms the Applicant provided departure information to Centrelink.  This information was not provided to the FAO. 

33.     The Applicant eventually accepted the decision to suspend SPP after 12 months continuous absence from Australia.  He does not dispute that FP should have ceased in October 1994. 

34.     The Applicant applied for a temporary tourist visa (subclass 676) on 4 September 1997.  This visa was issued 5 September 1997 with an end date of 4 September 1998.  This is evidence he was not an Australian resident after 5 September 1997.  It also provides notice to him that the Australian government is telling him he cannot stay permanently in Australia.  He (as opposed to any other person in any capacity) did not advise the FAO of this. 

35.     The Applicant did not qualify for FTB from 1 July 2000. 

36.     Correspondence from Centrelink dated 1 December 1997 relating to FP included the statement You must tell us if the Government tells you that you or any of your dependants cannot stay permanently in Australia. 

37.     The Applicant received correspondence from Centrelink in the form of recipient notices dated 24 June 2000, 29 June 2001, 28 June 2002 and 11 February 2003 from the FAO advising the basis of his FTB payments as well as the requirements to retain FTB payments, and he failed to advise the FAO within 14 days of ceasing to be an Australian resident as advised in each of the recipient notice letters. 

38.     The Applicant contributed to the receipt of ongoing payments to which he was not entitled, in that he failed to advise the FAO at any time that he was not an Australian resident.  Error cannot be attributed solely to the department. 

39.     The Applicant received:

$4,843.55 from 1 July 2000 to 30 June 2001;
$5,124.60 from 1 July 2001 to 30 June 2002;
$5,621.75 from 1 July 2002 to 30 June 2003;
$6,968.64 from 1 July 2003 to 30 June 2004;
$7,264.08 from 1 July 2004 to 30 June 2005;

$4,110.75 from 1 July 2005 to 10 February 2006;

totalling $33,933.37 to which he was not entitled.  The Applicant does not dispute the amount.  This is an overpayment to the Applicant, resulting in a debt to the Commonwealth. 

CONCLUSION

40.     The Tribunal is satisfied that the Applicant owes a recoverable debt to the Commonwealth. 

41.     The Applicant was in a position to know of the requirements for receipt of FTB and to notify if he was no longer able to stay permanently in Australia.  The Applicant did not undertake this notification, thereby contributing to the payments to which he was not entitled. 

42.     There is no evidence to support the presence of special circumstances as contended by the Applicant. 

43.     The Tribunal concludes that the Applicant did not satisfy the requirements necessary to allow for writing off or waiver of the debt. 

DECISION

44.     Accordingly, the Centrelink decision to recover the Applicant’s overpayment of FTB was the correct decision.  The Tribunal affirms the decision under review.

I certify that the forty-four [44] preceding paragraphs are a true copy of the reasons for the decision of:

Dr R. McRae, Member

(sgd):      Ursula Noyé

Clerk

Date of Hearing:  7 September 2007

Date of Decision:  20 February 2008

For the Applicant:  Self-represented

For the Respondent:  Ms K Paul, Centrelink Legal Services