DEBORAH MUNDY and SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS
[2009] AATA 225
•3 April 2009
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2009] AATA 225
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2008/2948
GENERAL ADMINISTRATIVE DIVISION ) Re DEBORAH MUNDY Applicant
And
SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS
Respondent
DECISION
Tribunal Mr R G Kenny, Member Date3 April 2009
PlaceBrisbane
Decision The Tribunal affirms the decision under review.
...................[Sgd]........................
Member
CATCHWORDS
SOCIAL SECURITY – benefits and entitlements – parenting payment – applicant not married at relevant time – applicant in a marriage-like relationship at relevant time – partnered rate of payment appropriate to applicant – overpayment of parenting payment – debt due to Commonwealth – no basis to write off debt – overpayment not due solely to administrative error by Commonwealth – no special circumstances to justify waiver of debt – decision affirmed
Social Security Act 1991(Cth) ss 4, 503, 1068B, 1223, 1236, 1237A, 1237AAD
Re Secretary, Department of Family and Community Services and Bell [2000] AATA 252
Beadle v Director-General of Social Security (1985) 7 ALD 670
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
REASONS FOR DECISION
3 April 2009 Mr R G Kenny, Member BACKGROUND
1. From 23 December 2004 until 7 March 2007 (the overpayment period), Deborah Mundy (the applicant) received social security payments in the form of parenting payment in accordance with the Social Security Act 1991 (“the Act”). Those payments were made on the basis that she was not a member of a couple. In March 2007, an officer of Centrelink, for the Secretary, Department of Education, Employment and Workplace Relations (the respondent), suspended Ms Mundy’s payments on the basis that she had been living with Robert Greco in a marriage-like relationship during the overpayment period. In May 2007, that decision was confirmed and it was also determined that, during the overpayment period, Ms Mundy was paid $28,409.68 more than she was entitled to and that this was a debt due by her to the Commonwealth. The decision was affirmed by an authorised review officer on 5 June 2007 and, in turn, by the Social Security Appeals Tribunal on 16 May 2008. Ms Mundy has applied for review of that decision by the Administrative Appeals Tribunal (“the Tribunal”).
ISSUES AND LEGISLATION
2. It is not disputed that Ms Mundy meets the qualifying criteria for the parenting payments she received. The rate of those payments is reduced while the recipient is living as a member of a couple. Ms Mundy and Mr Greco are not married to each other and, in that case, the criteria for determining the nature of their relationship are set out in s 4(2)(b) of the Act. The only aspect of that provision which is in dispute is whether, in accordance with s 4(3) of the Act, Ms Mundy and Mr Greco were in a marriage-like relationship during the overpayment period. That provision reads:
“4(3)In forming an opinion about the relationship between 2 people for the purposes of paragraph (2)(a) and subparagraph (2)(b)(iii), the Secretary is to have regard to all the circumstances of the relationship including, in particular, the following matters:
(a) the financial aspects of the relationship, including:
(i) any joint ownership of real estate or other major assets and any joint liabilities; and
(ii) any significant pooling of financial resources especially in relation to major financial commitments; and
(iii) any legal obligations owed by one person in respect of the other person; and
(iv) the basis of any sharing of day-to-day household expenses;
(b) the nature of the household, including:
(i)any joint responsibility for providing care or support of children; and
(ii) the living arrangements of the people; and
(iii) the basis on which responsibility for housework is distributed;
(c) the social aspects of the relationship, including:
(i)whether the people hold themselves out as married to each other; and
(ii) the assessment of friends and regular associates of the people about the nature of their relationship; and
(iii) the basis on which the people make plans for, or engage in, joint social activities;
(d) any sexual relationship between the people;
(e) the nature of the people's commitment to each other, including:
(i) the length of the relationship; and
(ii) the nature of any companionship and emotional support that the people provide to each other; and
(iii) whether the people consider that the relationship is likely to continue indefinitely; and
(iv) whether the people see their relationship as a marriage-like relationship”.
EVIDENCE
Ms Mundy
3. Ms Mundy gave the following evidence. She was divorced in May 2000. Thomas, a child of her marriage, was born in December 1998. She met Robert Greco in 2000 or 2001. At the time, she and Thomas were living in rented premises at 10 Leilani Drive, Birkdale. They continued to reside there until the end of March 2004. During that period, she had a sexual relationship with Mr Greco. There were several breaks in the relationship but, at one time, they became engaged to be married. She could not recall how long the period of engagement lasted and she could not recall ever discussing marriage with Mr Greco. While living at Leilani Drive, she became pregnant to Mr Greco. Their son, Matthew, was born in October 2004. The Leilani Drive house had been damaged in a storm early in 2004 and the landlord had failed to effect necessary repairs. For that reason, and because she was facing an increase in her rent, she moved in March 2004 to the home of Mr Greco at 719 Old Cleveland Road, Wellington Point, where she stayed until July 2004. This was a house on two levels, each of which was self-contained. She lived on the upper level with Thomas. Mr Greco occupied the lower level. She and Mr Greco had no sexual relationship at the Old Cleveland Road house.
4. Ms Mundy did not like living at the Old Cleveland Road house because it was on a busy road. She and Mr Greco decided to purchase a house but Ms Mundy was unable to recall whether being pregnant with her second child had any part to play in that decision. After inspecting various homes together, they selected a house at 8 Willard Close, Wellington Point. They obtained a joint loan of $319,000 from the Adelaide Bank to make the purchase. It was purchased as a joint tenancy and the mortgage was in joint names. The Old Cleveland Road house was used as a security for the loan. Ms Mundy and Mr Greco have continued to make loan repayments in equal amounts since then. Mr Greco sold his Old Cleveland Road house in July 2004 and used the proceeds towards the Willard Close house. Ms Mundy was advised by the solicitor who handled the conveyance of the house that, as neither of them had a will, it was desirable that they purchase as joint tenants rather than as a tenancy in common. Mr Greco gave Ms Mundy $10,000 to purchase furniture for the house. She was aware that, because the house is owned as a joint tenancy, the title for it will pass to Mr Greco in the event of her predeceasing him. She was comfortable with this as she was sure that it would eventually pass to the children.
5. Ms Mundy did not have sexual intercourse with Mr Greco while they were at the Old Cleveland Road house. They had sexual intercourse on one occasion only at the Willard Close house. This resulted in her becoming pregnant again and their second son, Nicholas was born in January 2006. Mr Greco attended the birth of Matthew. He did not attend the birth of Nicholas which resulted from an emergency Caesarean procedure and was premature. It was not planned that he would attend the birth of their second child. Ms Mundy decided on the names of Matthew and Nicholas.
6. The Willard Close house has four bedrooms. Ms Mundy has a bedroom with an ensuite for her sole use. Thomas and Mr Greco each have their own bedroom and Nicholas and Matthew share a bedroom. The males share the use of the main bathroom. There are two television viewing areas in the house and Ms Mundy does not watch television with Mr Greco. At one point in her evidence, Ms Mundy referred to the importance of children eating together with their parents and, for that reason, she preferred that they share the evening meal together. Subsequently, she described them as not doing so on a frequent basis as Mr Greco does paperwork when the rest of them have their meals.
7. Ms Mundy and Mr Greco have occasional outings together such as to the local park or, on one occasion, to the beach. Willard Close is a cul-de-sac in which the neighbours get on well and, from time to time, have street functions which Ms Mundy, Mr Greco and the three boys usually attend. She undertakes most of the chores in the house, although Mr Greco from time to time performs some of these, such as vacuuming. She also does some gardening work but heavier tasks such as mowing the lawn are undertaken by Mr Greco. She washes and irons her clothes and those of the children; Mr Greco does his own. Each of them is responsible for their own shopping for grocery and other household products and, apart from items such as milk and bread, they do not share these products. Ms Mundy shops at a Coles store and she was not able to say where Mr Greco did his shopping though she thought that he may go to an Aldi store. On the rare occasions when they did shop together, they each paid separately for the purchased items.
8. Ms Mundy and Mr Greco maintain separation in their finances. Each has an individual bank account. Initially, when the Willard Close house was purchased, they had a joint account only for the purpose of having a single account from which the Adelaide Bank was able to debit mortgage payments. Ms Mundy recently completed a college course and is now employed full-time with a Queensland government department. She receives child support for Thomas from her former husband in the amount of $250 per fortnight. Mr Greco pays child maintenance of $390 per fortnight but retains $90 of that sum as Ms Mundy’s contribution to the payment of recurrent bills such as for electricity, telephone and rates. Each has a car and Ms Mundy pays for all expenditure associated with her vehicle. When the children were younger, Mr Greco would use Ms Mundy’s car because it was fitted with child restraint seats. She also meets the payments for child care for Matthew and Nicholas
9. Ms Mundy takes Thomas to school and the younger boys to child care. She is mainly responsible for collecting them in the afternoon although Mr Greco would do so if he finished work early. Ms Mundy and Mr Greco have a common email address which is a combination of their first names followed by the number “3” to represent the three children. Ms Mundy lost her mobile phone and has used the phone of Mr Greco’s father since he passed away.
10. Ms Mundy’s family is well aware of the nature of the relationship she has with Mr Greco. Ms Mundy has been associated with other men while she has been living at Willard Close. She has not brought them to the house because she would not want to put Mr Greco through such an experience. She was not aware of whether or not Mr Greco saw other women.
11. Ms Mundy described herself and the three boys as being in good health. She has accumulated significant debts in addition to the parenting payment debt alleged by Centrelink. On various cards, she owes approximately $17,500.
Mr Greco
12. Mr Greco gave the following evidence. He met Ms Mundy in late 1999 and they were engaged to marry in 2000 or 2001. Marriage had certainly been discussed and it had been his intention to get married. He thought the engagement lasted for one to two years. He had been quite excited when he learned that Ms Mundy was pregnant and this played a part in their decision to purchase the Willard Close house. Ms Mundy’s stay at Old Cleveland Road was only ever a transitional arrangement pending the purchase of the Willard Close house. At the Old Cleveland Road house, he lived downstairs and Ms Mundy occupied the upper floor. When the Old Cleveland Road house was sold, he paid $180,000 towards the purchase of the Willard Close house. He had wanted to enter into an agreement with Ms Mundy before purchasing the Willard Close house because of the additional money he would contribute to it. However, because she was pregnant and because of other stressors operating at the time, he did not wish to cause further problems and he went along with the joint tenancy with no agreement entered into.
13. Mr Greco confirmed that the Willard Close house had four bedrooms which were allocated in the manner described by Ms Mundy. He and Ms Mundy had an ongoing regular sexual relationship while they were living at both the Old Cleveland Road house and the Willard Close house. He attended the birth of Matthew and it was planned that he would attend the birth of Nicholas. This did not happen because of the emergency nature of the birth which meant that the hospital was not able to contact him in time. He and Ms Mundy had discussed the names of their two boys and Matthew’s second name was Robert after himself.
14. Mr Greco often arrives home before Ms Mundy and, when that happens, he generally cooks his meal and those of Matthew and Nicholas. Ms Mundy usually prepares a meal for herself and Thomas. Typically, they all have the evening meal together and this happens about two-thirds of the time. He assists from time to time with chores such as vacuuming the house but mainly leaves those internal chores to Ms Mundy while he takes responsibility for the outdoor maintenance. Mr Greco does his own washing and ironing and tries to look after the clothes of Matthew and Nicholas. He agreed that Ms Mundy had been using his father’s phone since he passed way.
15. Mr Greco paid Ms Mundy a sum of money, perhaps $8,000, for her to buy items of furniture for the Willard Close house. He pays $390 per fortnight to Ms Mundy for maintenance but holds $90 back for the payment of common bills. He does almost all of the grocery shopping for the household and also pays for them himself. He said that Ms Mundy leaves a list of things needed in the cupboard and he uses that when he shops. He conceded that Ms Mundy did some shopping on some occasions. He confirmed that they have a common email address.
16. Ms Mundy usually drops the children off at school or child care in the mornings. They discuss the afternoon pick-up each day and coordinate the arrangements. He picks them up as often as he can. There are social occasions which he and Ms Mundy attend together and he referred to family weddings and funerals as examples. He has not explained to his family that he and Ms Mundy are not in a de facto relationship and he understood that his family believes they were. Ms Mundy and Mr Greco exchange gifts on birthdays and at Christmas time.
Other evidence
17. Ivy Jones and Jackie Hardcastle were associated with the care of Thomas for more than two years prior to their making statements on 8 June 2007. Both Ms Mundy and Mr Greco have met these women because they shared the task of collecting Thomas and the other boys in the afternoon. In their statements, they wrote that they had assumed that Ms Mundy and Mr Greco were living in a de facto relationship until they were advised differently by Ms Mundy.
18. In evidence were the documents relating to the joint loan taken out by Ms Mundy and Mr Greco. These nominate the purpose of the loan as being to purchase the house at Willard Close. They also record the marital status of each of them as “de facto” and neither Ms Mundy or Mr Greco could recall how that came about.
19. In response to a request by Centrelink, a staff member from the Redlands Hospital completed a questionnaire about Ms Mundy’s hospital records. The marital status description given by Ms Mundy when Nicholas was born in 2006 is that she was divorced and that her “partner” was Mr Greco. Ms Mundy said that this was done only in respect of the birth of the child. For the hospitalisation when Matthew was born, a copy of the Redlands Hospital record, dated 31 October 2004, was in evidence. It also describes Mr Greco as her “partner” and nominates him as “next of kin”.
20. Also in evidence were various Centrelink documents completed by Ms Mundy. She completed a claim for family tax benefit in December 2004 and gave the Leilani Drive house as her home address. At that time, she was living at Willard Close. She described this as a mistake. In that form, she described herself as “divorced” and not as living in a de facto relationship. In a family tax benefit claim form dated 6 March 2006, Ms Mundy revealed that she was living in her own home at Willard Close. Further, in the document, she answered “No” to the question: “Do you share your accommodation with anyone else?”
21. Ms Mundy completed a Parenting Payment Update form on 21 July 2006. A question in that form reads: “Are there any personal issues or circumstances which prevent you and your newborn child’s father from being a couple?” Ms Mundy responded that there was and wrote: “Not in country”. In giving further details, she wrote: “...overseas (Italy?) Not sending any regular or any payments”. When asked whether the newborn child’s father was currently employed, she wrote: “Don’t know”. When asked what her relationship was with the newborn child’s father at that time, she wrote: “Nothing”. In her evidence, Ms Mundy explained that she and Mr Greco had been in an argument the day before and that he had told her that he was leaving. She said that he packed a bag and left and she thought he was going to Italy. In his evidence, Mr Greco denied that he had ever left the house in that manner.
22. Ms Mundy completed a Customer Declaration form which was stamped by Centrelink as being received on 16 December 2004. It gives Ms Mundy’s address as Leilani Street, Birkdale. Ms Mundy said that she had not read the document even though she agreed that she had corrected the address entry in handwriting to read “Leilani Drive”. However, attached to that document is a photocopy of both sides of Ms Mundy’s driver’s licence on the back of which is the Willard Close address. Ms Mundy was living at Willard Close at that time.
23. In evidence was a copy of a statement made by Ms Mundy to Centrelink on 24 July 2006 to explain why she had not taken maintenance action through the Child Support Agency. There, she wrote that the father of Matthew and Nicholas gave her $10,000 towards a deposit on a home at 8 Willard Close.
24. In evidence were several Centrelink file notes relating to rent assistance. On 2 February 2005, Ms Mundy is recorded as paying $255 per week in rent and as not being able to provide rent certificates to verify the payments. Ms Mundy is recorded as stating that her landlords were travelling overseas for four months and that she had difficulty contacting them. Ms Mundy said that she was actually trying to cancel her rent assistance payments at that time. Similar file notes dated 8 March 2005 and 13 April 2005 were also in evidence and, again, Ms Mundy referred therein to her current lease agreement.
25. In evidence were copies of notices sent to Ms Mundy in relation to her parenting payment. These are dated 23 December 2004 and require her to advise of a range of events should they occur. One of these is if she is “living with someone of the opposite sex”.
SUBMISSIONS
26. Ms Brazier, for the respondent, submitted that the relationship between Ms Mundy and Mr Greco was marriage-like and that they were members of a couple throughout the overpayment period. She submitted that there was a mingling of their financial matters, in particular, in relation to the purchase of and mortgage payments for the Willard Close house. Ms Brazier referred to the sharing of successive premises and of various household functions in those premises as evidencing a household, the nature of which was marriage-like. She submitted that this was confirmed by the initial perceptions of the relationship by Ms Jones and Ms Hardcastle and by the description of themselves in documents as partners and de factos. The social aspects of the relationship were demonstrated by the joint use of an email address and Ms Mundy’s willingness to have Mr Greco present during childbirth. Ms Brazier submitted that there clearly had been a sexual relationship between them during the overpayment period and that Ms Mundy’s account of this was unlikely. She submitted that the purchase of the Willard Close house and the acceptance of joint mortgage responsibility demonstrated a high level of trust between them such as would be found in a marriage-like relationship.
27. Ms Brazier submitted that the overpayment amount of $28,409.68 is a debt that Ms Mundy owes to the Commonwealth and that there was no basis for that debt to be waived.
28. Ms Mundy submitted that she and Mr Greco lived in the same premises for the sake of the children and to avoid the need to spend additional money on separate premises. She submitted that she and Mr Greco were living separate lives under the one roof and that they were not in a marriage-like relationship.
CONSIDERATION: MEMBERS OF A COUPLE
29. While the evidence of Ms Mundy and of Mr Greco had many similarities, there were also significant inconsistencies between them. These included whether they had discussed marriage; the reason for purchasing the Willard Close house; the frequency of sexual contact between them; whether it was planned that Mr Greco be present at the birth of Nicholas; the selection of the names of Matthew and Nicholas; the procedures for having their evening meals; the arrangements in place for conducting the purchase of household supplies; the arrangements that existed for collecting the three boys after school and child care; and whether or not Mr Greco had packed a bag and left the Willard Close house on the day before Ms Mundy completed, on 21 July 2006, a Parenting Payment Update form in which she said that he was not in the country, that he was making no regular payments and that she did not know if Mr Greco was currently employed.
30. Additionally, there were significant inconsistencies in Ms Mundy’s own evidence. She gave conflicting accounts of the way in which the evening meal was taken. Early in her evidence, she stressed the importance of children eating together with their parents. Subsequently, after reference to this as being a significant family feature, she stated that Mr Greco usually ate his meal separately and then retired to do office work. In her evidence, she said that the lump sum given to her by Mr Greco was for the purchase of furniture. In her statement to Centrelink on 24 July 2006, she wrote that Mr Greco gave her the money as a deposit on the Willard Close house and that this was the reason for her not taking maintenance action through the Child Support Agency. In the Family Tax Benefit claim in December 2004, she gave her home address as the Leilani Drive house which she had moved from nine months earlier. In the claim form of July 2006, she wrote that she was not sharing her accommodation with anyone else when, clearly, she was doing so with Mr Greco and the children at the Willard Close house. Several documents which indicate that Ms Mundy was receiving rent assistance in February, March and April 2005 make reference to her inability to obtain rent certificates. In those documents, she explained this as being due to the absence overseas of her landlord. Clearly, she was not in rental premises at those times but living at Willard Close and, as she was not renting, there could be no rent certificates. In her evidence, her explanation was that, on those occasions, she was actually trying to cancel her rent assistance payment. That explanation is inconsistent with the Centrelink file notes and I do not accept it as correct. I also reject Ms Mundy’s evidence that, although she was engaged to marry Mr Greco, she had not discussed marriage with him.
31. Because of her inconsistent evidence, I do not accept Ms Mundy as a witness of truth and, where her evidence conflicts with that of Mr Greco, I accept as correct Mr Greco’s account.
32. Sub-section 4(3) of the Act requires that regard be had to all of the circumstances of the relationship between Ms Mundy and Mr Greco. In Re Secretary, Department of Family and Community Services and Bell[1] it was stated that the Tribunal is:
“[t]o give regard to the specified criteria in a real sense, i.e. to ensure sufficient and adequate regard is given to all the specified criteria; and [t]o take the criteria specified by the statute into account and to give weight to them as a fundamental element in the decision-making process”.
[1] [2000] AATA 252 at [24].
Financial aspects of the relationship
33. Ms Mundy and Mr Greco purchased a house together. They undertook home inspections together, settling on the Willard Close house. I do not accept that the move from the Old Cleveland Road house was solely because of the volume of traffic on the road. I accept Mr Greco’s evidence that they were aware Ms Mundy was pregnant and that they were seeking to have a house for them all. Significantly, the title is held as joint tenants. Mr Greco was willing to waive his desire to have a financial agreement drawn up in order to protect what was to be his greater contribution to the purchase. Indeed, after the sale of the Old Cleveland Road house, he paid $180,000 towards the Willard Close house. Mr Greco also entrusted Ms Mundy with the task of purchasing furniture for the house and with the sum of money, perhaps $8,000 to $10,000, to do so. Each of them undertook the legal responsibility to repay the loan jointly and, initially, Ms Mundy and Mr Greco operated a joint bank account to do so. I accept Mr Greco’s evidence that he is mainly responsible for the purchase of household items and that he pays for them. He receives a $90 fortnightly contribution from Ms Mundy but those monies are used for the discharge of periodic bills such as for electricity, telephone and rates.
34. Those matters amount to a substantial degree of intermingling of the financial aspects of the relationship between Ms Mundy and Mr Greco.
Nature of the household
35. Ms Mundy and Mr Greco each occupy their own bedroom and there is some separation of household functions such as washing, ironing and preparation of meals. However, in many other respects there is a measured degree of cooperation between them. Most of the indoor chores are completed by Ms Mundy and most of the outdoor responsibilities are assumed by Mr Greco. On Mr Greco’s evidence, Ms Mundy has entrusted the bulk of household shopping to him and she assists by providing a list for his guidance. Also, on Mr Greco’s evidence, there is discussion each morning between him and Ms Mundy on the issue of which of them will collect the children from school and child care. When the children were younger, only Ms Mundy’s vehicle was fitted with safety seating for the children and she and Mr Greco would each use the vehicle if he or she was driving with the children.
36. Whilst not conclusive, there are elements of the Willard Close household which are consistent with the nature of a marriage-like relationship.
Social aspects of the relationship
37. Mr Greco has not advised his family that his relationship with Ms Mundy is anything other than a normal one between a male and female. Clearly, on that basis, his parents must see them as members of a couple. That was also the opinion of Ms Jones and Ms Hardcastle who had the opportunity of observing Ms Mundy and Mr Greco for two years of the overpayment period. During that time, they were of the opinion that Ms Mundy and Mr Greco were living in a de facto relationship and only took a different view based on what they were told by Ms Mundy. Their statements were made after the authorised review officer affirmed the decision against Ms Mundy.
38. Documents relating to the loan for the purchase of the Willard Close house record the marital status of Ms Mundy and Mr Greco as “de facto” and, although Ms Mundy or Mr Greco could not recall how that came about, I am satisfied that the information must have been supplied by one of them. If that is not the case, each of them has permitted the information to remain in that documentation. That is also the situation with the description of Mr Greco as Ms Mundy’s “partner” and “next of kin” in Redland Hospital records.
39. Ms Mundy and Mr Greco have occasional outings with the children and these include visits to the local park and beach as well as community based activities with fellow cul-de-sac neighbours. Mr Greco’s evidence was that they also attend family occasions such as weddings and funerals.
40. Whilst Ms Mundy and Mr Greco do not enjoy an active social life together, they share some activities, have held themselves out as being in a de facto relationship and have been perceived by others to be in such a relationship.
Sexual relationship
41. I accept the evidence of Mr Greco that he and Ms Mundy have been in a continuing sexual relationship throughout the overpayment period and, indeed, to the present time.
The nature of commitment to each other
42. Ms Mundy and Mr Greco have been associated with each other for approximately nine years. In the early stages, there were breaks in that relationship but, at one time, they became engaged to marry and this lasted, on Mr Greco’s evidence, for more than one year. When Ms Mundy became pregnant with Matthew, they decided to share premises and occupied the Old Cleveland Road house, on a temporary basis, until the purchase of the Willard Close house was finalised. They have remained in those premises since mid-2004 and have two children together. They have borrowed money together and purchased a house as joint tenants. Mr Greco was prepared to contribute a substantially greater sum to that purchase than did Ms Mundy without any formal agreement to record that. Those factors demonstrate a significant level of commitment by Ms Mundy and Mr Greco to each other throughout and beyond the overpayment period.
Conclusion
43. Having considered the relationship between Ms Mundy and Mr Greco in accordance with all of the matters listed in s 4(3) of the Act, particularly its financial, social and sexual aspects as well as the nature of their commitment to each other, I am satisfied that they were living in a marriage-like relationship throughout the overpayment period. I am also satisfied that, during the overpayment period, Ms Mundy was in a relationship with a person of the opposite sex to whom she was not legally married. This means that, in accordance with s 4(2) of the Act, she was a member of a couple during the overpayment period.
CONSIDERATION: OVERPAYMENT AND DEBT
44. In accordance with s 503 of the Act, the rate of Ms Mundy’s parenting payment was to be determined under the rate calculator at the end of s 1068B of the Act. As a member of a couple, her rate of payment should have taken into account the income of her partner. This was not done and, as a result, she received parenting payments at a rate higher than she was entitled to receive. The overpayment was calculated by Centrelink at $28,409.68. In evidence was a record of the calculations of that amount and I am satisfied that those calculations, which were not challenged by Ms Mundy, have been correctly made. Under s 1223 of the Act, that sum is a debt due by Ms Mundy to the Commonwealth.
45. A debt may be written off under s 1236 of the Act where one of the following is met:
“(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”.
46. A debt is taken to be irrecoverable at law only if it cannot be recovered by means of deductions, or legal proceedings, or garnishee notice[2]; if there is no proof of the debt capable of sustaining legal proceedings for its recovery[3]; if the debtor is discharged from bankruptcy and the debt was incurred before the debtor became bankrupt and was not incurred by fraud[4]; or if the debtor has died leaving no estate or insufficient funds in the debtor's estate to repay the debt[5]. It is not in dispute that none of those factors are met. Further, if a debt is recoverable by means of deductions from the debtor's social security payment, the debtor is taken to have a capacity to repay the debt unless recovery by those means would result in the debtor being in severe financial hardship[6]. Centrelink is currently recovering the debt by that means. Accordingly, the debt may not be written off under s 1236.
[2] See s 1236(1B)(a) of the Act.
[3] See s 1236(1B)(b) of the Act.
[4] See s 1236(1B)(c) of the Act.
[5] See s 1236(1B)(d) of the Act.
[6] See s 1236(1C) of the Act.
47. A debt may be waived, under s 1237A of the Act, if it was attributable solely to an administrative error made by the Commonwealth. As noted above, a notice, dated 23 December 2004, was sent to Ms Mundy in relation to her parenting payment requiring her to advise if she is “living with someone of the opposite sex”. Ms Mundy did not advise Centrelink that she was living with Mr Greco during the overpayment period. Accordingly, Ms Mundy’s debt did not arise solely through administrative error made by the Commonwealth.
48. A debt may also be waived under s 1237AAD of the Act where there are special circumstances, other than financial hardship alone, that make it desirable to waive it. The Act provides no guidance as to the meaning of the term “special circumstances” in s 1237AAD of the Act. In Beadle v Director-General of Social Security, the Full Federal Court stated that it was not possible to lay down precise limits or precise rules for the meaning of the term. The Court indicated that this would depend upon the circumstances of each particular case but commented that, even though the term lacks precision, it was sufficiently understood “not to require judicial gloss”[7]. The Court affirmed the decision of the Tribunal which had acknowledged that the term was “incapable of precise or exhaustive definition” and that, to be special, the circumstances “must have a particular quality of unusualness that permits them to be described as special”[8].
[7] (1985) 7 ALD 670 at 674.
[8] Re Beadle and Director-General of Social Security (1984) 6 ALD 1 at 3.
49. In Groth v Secretary, Department of Social Security[9], Kiefel J, after referring to the Federal Court's decision in Beadle’s case, observed that special circumstances:
“would require something to distinguish ... [the] ... 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”.
[9] (1995) 40 ALD 541 at 545.
50. In addition to the mortgage obligations, Ms Mundy has debts amounting to some $17,500. However, no other matters were raised by her in relation to circumstances which may be described as special. Neither do any such factors appear in the evidence before me and I am satisfied that the debt may not be waived under s 1237AAD of the Act.
CONCLUSION
51. Ms Mundy has a debt due to the Commonwealth in the amount of $28,409.68 which may not be written off or waived under the Act.
DECISION
52. The Tribunal affirms the decision under review.
I certify that the 52 preceding paragraphs are a true copy of the reasons for the decision herein of Mr R G Kenny, Member
Signed: ............................[Sgd]...............................................
Mátyás Kochárdy, Research AssociateDate of Hearing 19 March 2009
Date of Decision 3 April 2009
The Applicant was self-represented
Solicitor for the Respondent Michelle Brazier, Departmental Advocate
0
2
0