Dempsey; Secretary, Department of Social Services and (Social services second review)
[2020] AATA 1302
•13 May 2020
Dempsey; Secretary, Department of Social Services and (Social services second review) [2020] AATA 1302 (13 May 2020)
Division:GENERAL DIVISION
File Number(s): 2019/4548
Re:Secretary, Department of Social Services
APPLICANT
AndGary Dempsey
RESPONDENT
DECISION
Tribunal:Mr S Evans, Member
Date:13 May 2020
Place:Sydney
The Tribunal sets aside the decision under review and substitutes a decision that Mr Dempsey was not an Australian resident for the purposes of section 29 of the Social Security Act 1991 (Cth) between 5 June 2018 and 4 September 2018.
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Mr S Evans, Member
CATCHWORDS
SOCIAL SECURITY – age pension – qualification – residence requirements – decision set aside and substituted
LEGISLATION
Social Security (Administration Act) 1999 (Cth)
Social Security Act 1991 (Cth)
CASES
Boucaut v Department of Families, Housing, Community Services and Indigenous Affairs [2012] AATA 726
Moore and Secretary Department of Social Services [2015] AATA 669
Re Maha Hafza v Director-General of Social Security (1985) 6 FCR 444
Stevens and Secretary Department of Families, Housing, Community Services and Indigenous Affairs [2013] AATA 675Wybrow and Secretary of Department of Social Security [1992]AATA 315
SECONDARY MATERIALS
Guides to Social Policy Law, Social Security Guide
REASONS FOR DECISION
Mr S Evans, Member
13 May 2020
Gary Dempsey (“the Respondent”) claimed age pension on 5 June 2018. His application was rejected on 4 September 2018 by the Department of Social Services (“the Applicant” also known as “Centrelink”) because he had not been living in Australia on a permanent basis and he did not qualify as an Australian resident.
Mr Dempsey requested an internal review of the decision and it was affirmed by an Authorised Review Officer (“ARO”) on 31 January 2019. He then appealed to the Social Security and Child Support Division (“AAT1”) of this Tribunal, which on 25 June 2019 set aside the decision of the ARO and in substitution determined that Mr Dempsey was an Australian resident for social security purposes.
The Secretary of the Department of Social Services now appeals the decision of the AAT1 on the basis that Mr Dempsey was not an Australian resident within the meaning of the Social Security (Administration Act) 1999 (Cth) (“the Administration Act”).
Unless otherwise stated, the statements of facts in this decision are based on the evidence provided by Mr Dempsey.
For the reasons which follow, I have decided to set aside the decision of the AAT1.
BACKGROUND
Mr Dempsey
Mr Dempsey was born in 1952 and is currently 67 years old. He is an Australian citizen and served in the Australian Defence Force, both full time and as a reservist for many years.
In January 2014 he and his then wife rented out their house in Australia and travelled to Vietnam. Mr Dempsey remained overseas for most of 2014 returning to Australia in December. Following his return he and his then wife separated.
Mr Dempsey decided to continue his travels and returned to Asia for a further six months. When he returned to Australia in July 2015 he was looking for work and was granted Newstart Allowance. He found it difficult to find employment which he attributes to his age. He also found the cost of living made it challenging to manage financially.
In October 2015 he travelled overseas and based himself in Vietnam. He chose Vietnam because it was cheap to live there and was a convenient base to travel to other locations.[1]
[1] T-documents, T8 p 46.
Mr Dempsey has three daughters, one in Queensland, one in NSW and one who lives in France. He also has a mother, brother and sister who reside in Australia.
Vietnam
In recent years Mr Dempsey has spent most of his time in Vietnam. He now has a partner there who he lives with along with his partner’s teenage daughter. Mr Dempsey reports he has been living with his partner in her house since about December 2017.
Mr Dempsey enters Vietnam on a tourist visa which allows him to reside in Vietnam with the provision that he must depart the country once every three months when the visa expires.
Application for aged pension
Mr Dempsey applied for the age pension on 5 May 2018. He departed Australia the following month on 17 June 2018.
On 4 September 2018 he was notified that his claim for age pension had been rejected because he was not living in Australia on a permanent basis.
RELEVANT LAW AND POLICY
In order to make a claim for social security payments, including the age pension, a person must be an Australian resident. Section 29 of the Administration Act provides:
(1) Subject to sections 30, 30A, 31, 31A and 32, a claim for a social security payment or a concession card may only be made by a person who:
(a) is an Australian resident; and
(b) is in Australia.
(2) Subject to sections 30, 30A, 31, 31A and 32, a claim made at a time when the claimant is not an Australian resident or is not in Australia is taken not to have been made.
The specific exceptions in sections 30, 30A, 31, 31A and 32 do not apply to Mr Dempsey.
In addition to the residence requirement in section 29 of the Administration Act, the applicant must also satisfy section 43 of the Social Security Act 1991 (“the Act”).
Subsection 43(1) of the Act provides that a person who has reached pension age is qualified for an age pension if any of the following applies:
(a) The person has 10 years qualifying Australian residence;
(b) The person has a qualifying residence exemption for an age pension;
(c) The person was receiving a widow B pension, a widow allowance, a mature age allowance or a partner allowance, immediately before reaching that age; or
(d) If the person reached pension age before 20 March 1997 – the person was receiving a widow B pension, a widow allowance or a partner allowance, immediately before 20 March 1997.
The definition for “Australian residence” are set out in section 7 of the Act as follows:
7 Australian residence definitions
(1) In this Act, unless the contrary intention appears:
Australian resident has the meaning given by subsection (2).
…
qualifying Australian residence has the meaning given by subsection (5).
(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.
Subsection 7(3) of the Act identifies a number of factors to which regard must be had in determining whether a person was an Australian resident at the time of their application:
(3) In deciding for the purposes of this Act whether or not a person is residing in Australia, regard must be had to:
(a) the nature of the accommodation used by the person in Australia; and
(b) the nature and extent of the family relationships the person has in Australia; and
(c) the nature and extent of the person’s employment, business or financial ties with Australia; and
(d) the nature and extent of the person’s assets located in Australia; and
(e) the frequency and duration of the person’s travel outside Australia; and
(f) any other matter relevant to determining whether the person intends to remain permanently in Australia.
The Tribunal also has before it paragraph 3.1.1.10 of the Social Security Guide (“the Guide”) which provides guidance to decision makers when determining if an applicant meets the residence requirements.
ISSUES FOR THE TRIBUNAL
The sole issue for the Tribunal is whether Mr Dempsey was residentially qualified for the age pension as of the date of claim or in the 13 week period after, in other words between 5 June 2018 and 4 September 2018 (“the claim period”).
THE APPLICANT’S CASE
The Secretary submits that Mr Dempsey does not reside in Australia and therefore does not meet subsection 7(3) of the Act. It is the Applicant’s contention that Mr Dempsey must establish that Australia is his settled or usual place of abode during the claim period and draws the Tribunal’s attention to the Guide which states:
The decision as to whether a person is residing in Australia must be based on the balance of all the available evidence. No single factor should be taken to be conclusive on its own and some factors will usually provide a greater indication than others, however in the majority of cases the most weight should be given to the time spent in Australia. In general, it is also expected that a person who resides in Australia will be able to demonstrate strong ties to Australia under a number of different criteria listed in [the Act] section 7(3).
To support the Applicant’s contention it is submitted that the matter of Re Maha Hafza v Director-General of Social Security (1985) FCR 444 relevantly explored the concept of home:
14. Physical presence and intention will co-incide for most of the time. But few people are always at home. Once a person has established a home in a particular place -- even involuntarily : see Commissioners of Inland Revenue v. Lysaght (1928) AC 234 a p 248 and Keil v Keil (1947) VR 383 -- a person does not necessarily cease to be resident there because he or she is physically absent. The test is whether the person has retained a continuity of association with the place -- Levene v. Inland Revenue Commissioners [1928] UKHL 1; (1928) AC 217 at p 225 and Judd v. Judd (1957) 75 WN (N.S.W.) 147 at p 149 -- together with an intention to return to that place and an attitude that that place remains "home" -- see Norman v Norman (1969) 16 F.L.R. 231 at p.236 It is important to observe firstly, that a person may simultaneously be a resident in more than one place -- see the facts of Lysaght and the reference by Williams J. to "a home or homes" -- and, secondly, that the application of the general concept of residence to any particular case must depend upon the wording, and underlying purposes, of the particular statute in relation to which the question arises. But, where the general concept is applicable, it is obvious that, as residence of a place in which a person is not physically present depends upon an intention to return and to continue to treat that place as "home", a change of intention may be decisive of the question whether residence in a particular place has been maintained.
The Applicant in particular relies on Mr Dempsey’s time outside Australia since 2014 to demonstrate that he is not a resident for social security purposes.
MR DEMPSEY’S CASE
Mr Dempsey is self-represented and has provided a comprehensive and compelling submission to the Tribunal. He has also presented the Tribunal with a phone call that he made to Centrelink and was able to access through a freedom of information request. He summarises the phone call from 12 June 2018 as follows:
[I] was informed by a worker that I meet the requirements and I was free to travel and reside abroad where ever I wished but would only receive the basic Pension. That is what I have done and after almost 10 months I have not been advised how I can obtain age pension.
[errors in original]
He claims that if he had known that leaving Australia during the claim period would jeopardise his application, he would not have left. But as he was told otherwise by Centrelink during the phone call, he did just that and travelled to Vietnam on 16 June 2018.
He notes the longest continuous period that he has spent outside of Australia was in 2014 for a period of 10 months. He identifies that he was in Australia at the time he made the application. He does not consider himself a former resident, but a permanent resident of Australia. He had not, until 2014, travelled outside of the country for any period of time. When he has travelled overseas, he returns to Australia regularly.
He submits that 10 months of his travel outside of Australia was for the purposes of volunteer work which he undertook with an NGO which assists disabled and homeless people in Vietnam.
Mr Dempsey also contends that he is being disadvantaged by a change which was made to the law but which was not aimed at individuals such as himself.
The Productivity Commission (No 77, 13th April 2016) raised concerns regarding the cost of parent migrants who have not resided in Australia during any part of their working lives and therefore not contributed to Australia and yet are dependent on Australian social security payments to financially support them in their retirement. Under changes made to the Social Security Act section 7 legislation was introduced to discourage people from coming to Australia to get a pension and take it back overseas. I [Mr Dempsey] should not be included under the terms, I am an Australian born citizen who has contributed to Australia my whole working life and have given 23 years Defence force service.[2]
[2] T-documents, T14 p 66.
Mr Dempsey has referred the Tribunal to a number of cases where individuals have been determined by the Secretary not to be residentially qualified for a benefit but subsequently found by the Tribunal to meet the criteria.
Whilst there are similarities, there are notable and potentially determinative differences and the Tribunal must take look into the entirety of the circumstances of Mr Dempsey’s application. In the matter of Wybrow and Secretary of Department of Social Security [1992] AATA 315 Mr Wybrow had a home in Australia, albeit one which was the subject of a claim from his wife. Critically, it was determined by the Tribunal that Mr Wybrow intended to live permanently in Australia.
In the matter of Moore and Secretary Department of Social Services [2015] AATA 669 Mr Moore went overseas to work. He spent most of his time in China and visited his wife in Thailand. His wife was an Australian permanent resident and, with reference to Issa and Secretary, Department of Social Security [1985], Senior Member Isenberg states at [72]:
…where it was held that if a person continues to reside overseas after fulfilling their singular, specific, passing purpose, their absence may be considered indefinite rather than temporary. In this case before me now, at the conclusion of the work contract, the Applicant returned to Australia.
The Applicant in this matter has also submitted other decisions for the Tribunal to consider. As is the case with the cases presented by the Respondent, there are both similarities and differences. In Stevens and Secretary Department of Families, Housing, Community Services and Indigenous Affairs [2013] AATA 675, Senior Member Cunningham considers Mr Steven’s intention to remain in Australia on a permanent basis. The circumstances of Mr Steven’s are similar to Mr Dempsey’s particularly as Mr Steven also spent a lot of time in Vietnam.
Most relevantly in this matter is what his Honour Wilcox J said in Re Maha Hafza v Director-General of Social Security (1985) 6 FCR 444 at [13]:
There is a plethora of decisions, arising in various contexts but predominantly matrimonial causes and revenue cases, relating to the legal concept of residence. As a general concept residence includes two elements: physical presence in a particular place and the intention to treat that place as home; at least for the time being, not necessarily forever.
…
Physical presence and intention will co-incide for most of the time. But few people are always at home.
…
But, where the general concept is applicable, it is obvious that, as residence of a place in which a person is not physically present depends upon an intention to return and to continue to treat that place as "home", a change of intention may be decisive of the question whether residence in a particular place has been maintained.
Indeed there is a plethora of decisions in which parallels can be drawn and similarities to Mr Dempsey’s case exist. It falls to the Tribunal to look at Mr Dempsey’s particular circumstances and to consider his situation as a whole and the Tribunal must have regard to the factors set out in subsection 7(3) of the Act.
The nature of the accommodation used by the person in Australia
Mr Dempsey confirmed to the Tribunal that when he is in Australia he lives with his brother. He also occasionally stays with his mother or his sister. His brother has moved his home office out and now Mr Dempsey has his own room there. He has his own key and helps out by buying food but does not pay for rent, utilities or bills. He does, however, keep his clothes there and can ‘come and go’ as he wishes.
The nature and extent of the family relationships the person has in Australia
Mr Dempsey lives with his partner in Vietnam most of the time. As mentioned, Mr Dempsey has three children, two of whom reside in Australia. His mother, brother, sister and two grandchildren are also in Australia and he provided evidence that he has contact with all of them when he is in Australia, and he has visited his daughter in France twice.
The Applicant contends that the relationship with Mr Dempsey’s partner in Vietnam “has considerable greater significance with respect to his Australian residency for age pension compared to his family ties in Australia”.
In his submission Mr Dempsey does not address this issue directly but does note that the Secretary has made some errors in determining when it was that he ceased to be an Australian resident.
During the hearing Mr Dempsey was questioned about his relationship with his 14 year old step-daughter in Vietnam. He confirmed that he assists her with schooling, helps teach her English and he buys her gifts for special occasions. It is evident that he plays a positive and influential role in his step-daughter’s upbringing.
The nature and extent of the person’s employment, business or financial ties with Australia
Mr Dempsey has not presented any evidence which supports business or financial ties with Australia. Mr Dempsey confirmed at the hearing that he has not filed a tax return in Australia for a number of years. However, neither is there any evidence to show Mr Dempsey has business or financial ties overseas.
The nature and extent of the person’s assets located in Australia
Mr Dempsey submits that his finances are in Australia and it is here that he borrows, invests and saves.
Mr Dempsey confirmed to the Tribunal that he has not owned a car since selling his house in 2014. He has about $1000 worth of household and personal items that he stores in Australia with various family members. He did not indicate that he accesses or uses these items when he is in Australia.
He has no money in his superannuation account but does have an Australian bank account where he has most of his considerable savings. He also has a Vietnamese account, which he uses mainly in Vietnam in order to avoid expensive overseas transaction fees.
This evidence presents a mixed picture. Mr Dempsey clearly maintains most of his assets in Australia, but it would appear that they are liquid and easily transferred to his account in Vietnam. He has none of the assets such as a house or car which might indicate Mr Dempsey intends to spend more time in Australia or sees it as his base. In contrast, he does have a motorbike in Vietnam.
The frequency and duration of travel outside Australia
The evidence is that during the period from 25 January 2014 until the date of claim Mr Dempsey has spent 1,391 out of 1,591 days outside of Australia. Since making his claim for age pension, he has spent 473 out of 527 days outside of Australia. Mr Dempsey returned from Vietnam on 9 March 2020.
The Guide states that a person does not need to be continuously present in a country in order to be residing there. A person holidaying or working temporarily overseas does not necessarily cease to reside in Australia while they are away. It goes on to direct the decision maker to look closely at the “pattern and duration of time spent outside Australia in order to ascertain whether a person continues to reside in Australia”.
Relevantly, the Guide also instructs decision makers who are presented with “a person who has spent the majority of their time overseas in the last few years and who returns to Australia to claim a benefit”, as is the case with Mr Dempsey, that the person “must demonstrate that their physical ties with Australia have been re-established, or are in the process of being established and that they intend to reside in Australia again”.
I consider that the evidence supports the finding that Mr Dempsey was not an Australian resident during the relevant period.
Other relevant matters
Mr Dempsey also told the Tribunal that he had considered getting an Australian visa for his partner and step daughter but that it was, at this stage, prohibitively expensive. He said that they had visited Australia as tourists but he confirmed that they had never applied for a permanent Australian visa.
CONSIDERATION
Mr Dempsey makes a strong emotional argument that he is eligible for the age pension. He is an Australian citizen, he has spent his entire working life in Australia and he served in the Australian Defence Force.
Having separated from his now former wife later in life and finding it difficult to secure employment as he approached pension age, he has sought to travel, to volunteer his time and has now entered into a new relationship. He has a step-daughter who he provides a level of active care to.
The evidence leads the Tribunal to conclude that Mr Dempsey has established a life in Vietnam and that is for all intents and purposes where he considers home and where the people with whom he currently has the most significant relationship with are.
There is very little evidence to counter this conclusion. Mr Dempsey has a bank account in Australia, but he also has one in Vietnam. He owns some household possessions of small value which he keeps at his daughter’s, brother’s and sister’s houses. He stays with his brother whilst he is in Australia, and until his brother cleared out his home office, he would sleep there on the couch. Mr Dempsey is not entitled to stay permanently in Vietnam, but as noted in Boucaut v Department of Families, Housing, Community Services and Indigenous Affairs [2012] AATA 726 at [21], “Mr Boucaut’s temporary immigration status in Thailand does not alter the fact that it has become his home and he is no longer a resident of Australia”.
In a submission to the Tribunal Mr Dempsey attributed the difficulties he has experienced in applying for the age pension to poor advice received from Centrelink, which is particularly relevant to his subsequent decision to leave the country shortly after making his application. In reaching a decision the Tribunal has considered the totality of the pension applicant’s circumstances.
Mr Dempsey says he is in a “Catch-22”. If he leaves Australia he cannot get the age pension and if he stays in Australia it is too expensive for him to live here.
However, it is clear from the drafting of subsection 7(3) that there must be evidence that a person intends to remain in Australia on a permanent basis in order to qualify as an Australian resident for the purposes of social security law. Mr Dempsey has spent relatively little time in Australia since 2014. There is little evidence that he has plans to return to Australia as he lives with his partner and his partner’s daughter in Vietnam.
Whilst he has considered the practicalities of moving his Vietnamese family to Australia, including the cost of visas and the fact his partner would need to sell her house, he has not made any concrete steps towards doing so. He is of the view the cost is prohibitive.
For these reasons the Tribunal finds that Mr Dempsey’s circumstances do not establish that he was a person residing in Australia at the time of the decision under review.
DECISION
The Tribunal sets aside the decision of the AAT1 dated 25 June 2019 and substitutes a decision that Mr Dempsey was not an Australian resident for the purposes of section 29 of the Act between 5 June 2018 and 4 September 2018.
I certify that the preceding 60 (sixty) paragraphs are a true copy of the reasons for the decision herein of Mr S Evans, Member
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Associate
Dated: 13 May 2020
Date(s) of hearing: 19 March 2020 Solicitors for the Applicant: Dr S Thompson, Services Australia Respondent: By phone
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