Di Paolo v Secretary, Department of Social Services
[2024] FCA 1313
•15 November 2024
FEDERAL COURT OF AUSTRALIA
Di Paolo v Secretary, Department of Social Services [2024] FCA 1313
File number(s): VID 1113 of 2023 Judgment of: BUTTON J Date of judgment: 15 November 2024 Catchwords: ADMINISTRATIVE LAW – appeal from decision of the Administrative Appeals Tribunal (Tribunal) setting aside decision of the Tribunal’s Social Services and Child Support Division regarding the Applicant’s social security entitlements – whether Tribunal erred in relation to the standard of proof – whether Tribunal erred in its application of the evidential onus of proof – whether Tribunal misunderstood or misapplied s 41 of the Trustee Act 1958 (Vic) – whether Tribunal failed to perform its irreducible jurisdictional task or afford the Applicant procedural fairness – whether Tribunal acted unreasonably or irrationally – whether Applicant failed to comply with s 39 of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) – where appeal commenced under s 44 of the AAT Act to proceed under the Administrative Review Tribunal Act 2024 (Cth) – appeal dismissed
PRACTICE AND PROCEDURE – Application for an extension of time to file cross-appeal from the decision of the Tribunal – where no adequate explanation provided for the delay – where merit of proposed cross-appeal unclear – application dismissed
Legislation: A New Tax System (Family Assistance) (Administration) Act 1999 (Cth)
Administrative Appeals Tribunal Act 1975 (Cth)
Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Act 2024 (Cth)
Administrative Review Tribunal Act 2024 (Cth)
Social Security Act 1991 (Cth)
Federal Court Rules 2011 (Cth)
Trustee Act 1958 (Vic)
Cases cited: Applicant WAEEv Minister for Immigration and Multicultural and Indigenous Affairs (2003) 236 FCR 593; [2003] FCAFC 184
Briginshaw v Briginshaw (1938) 60 CLR 336
Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280
Collins v Minister for Immigration and Ethnic Affairs (1981) 36 ALR 598; 58 FLR 407
Comcare v Power (2015) 238 FCR 187; [2015] FCA 1502
Commissioner for ACT Revenue v Alphaone Pty Ltd (1994) 49 FCR 576
East v Repatriation Commission (1987) 16 FCR 517; [1987] FCA 24
Freeman v Military Rehabilitation and Compensation Commission [2018] FCA 394
Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123; [2018] HCA 34
Jones v Dunkel (1959) 101 CLR 298
Kamal v Minister for Immigration, Citizenship and Multicultural Affairs (2023) 300 FCR 106; [2023] FCAFC 159
Kamal v Minister for Immigration, Citizenship and Multicultural Affairs [2023] FCA 200
KXXH v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2022) 292 FCR 15; [2022] FCAFC 111
Leach v Comcare (2021) 285 FCR 326; [2021] FCAFC 134
McDonald v Repatriation Commission (1984) 1 FCR 354; [1984] FCA 59
Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259
Parr v Commissioner of Taxation [2022] FCA 67
Plaintiff M61/2010E v Commonwealth (2010) 243 CLR 319; [2010] HCA 41
Prygodicz v Commonwealth (No 2) [2021] FCA 634
Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 198 ALR 59; [2003] HCA 30
Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57
Sullivan v Civil Aviation Safety Authority (2014) 226 FCR 555; [2014] FCAFC 93
Tarrant v Australian Securities and Investments Commission (2015) 317 ALR 328; [2015] FCAFC 8
Division: General Division Registry: Victoria National Practice Area: Administrative and Constitutional Law and Human Rights Number of paragraphs: 190 Date of last submissions: 23 October 2024 Date of hearing: 16 October 2024 Counsel for the Applicant: Mr B Overend Counsel for the Respondent: Ms L Kirwan Solicitor for the Respondent: Australian Government Solicitor ORDERS
VID 1113 of 2023 BETWEEN: SOFIA DI PAOLO
Applicant
AND: SECRETARY, DEPARTMENT OF SOCIAL SERVICES
Respondent
ORDER MADE BY:
BUTTON J
DATE OF ORDER:
15 NOVEMBER 2024
THE COURT ORDERS THAT:
1.The Applicant’s appeal be dismissed.
2.The Respondent’s application filed 15 October 2024 be dismissed.
3.The Applicant pay the Respondent’s costs, other than the costs of the Respondent’s application filed 15 October 2024, to be taxed if not agreed.
4.The Respondent pay the Applicant’s costs of the Respondent’s application filed 15 October 2024, to be taxed if not agreed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
BUTTON J:
INTRODUCTION
By a proposed Amended Notice of Appeal dated 30 July 2024, the Applicant appeals from a decision of the Administrative Appeals Tribunal (the Tribunal) dated 24 November 2023. The Tribunal found that the Applicant has debts due to the Commonwealth for overpayment of social security benefits and that those debts should not be written off or waived (the Tribunal’s decision or T).
I note that, from 14 October 2024, the Tribunal was replaced by the Administrative Review Tribunal (the ART). While the proceeding continued before me in accordance with the Administrative Review Tribunal Act 2024 (Cth) (the ART Act), anything the Court could have done in relation to the Tribunal before 14 October 2024 may be done in relation to the ART: Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Act 2024 (Cth) sch 16 item 25; see also Revised Explanatory Memorandum, Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Bill 2024 (Cth) at [1543]. The parties made their submissions by reference to the provisions of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act), which applied when the Tribunal conducted the hearing and determined the matter. No party suggested that the new provisions of the ART Act affected the conduct of the appeal. I refer to the provisions of the AAT Act in relation to the proceedings before the Tribunal.
The Applicant seeks orders from this Court that the Tribunal’s decision be quashed and the Tribunal be required to determine the review of the Applicant’s alleged social security debts in accordance with law. The Applicant also seeks an injunction restraining the Respondent and his delegates or officers from making any future decision or taking any further action the subject of this proceeding, including enforcing repayment of any of the social security debts in question.
The Applicant relied on submissions dated 29 July 2024 and 10 September 2024. The Respondent relied on submissions dated 27 August 2024. On 23 October 2024, after the hearing had concluded, the Respondent provided an aide-mémoire regarding some of the documents relating to the Mandoulidis Family Trust (the Trust) that were before the Tribunal.
On 15 October 2024, being the day before the hearing, the Respondent filed an application for an extension of time to file a Notice of Cross-Appeal in this proceeding. I refused that application.
BACKGROUND
On 24 July 2020, Services Australia commenced an investigation into the Applicant’s past and (then) present entitlement to receive social security payments. In these reasons, I will refer to Centrelink for convenience, while noting that, for some of the relevant period, Services Australia had come into existence and also administers other programs.
On 23 September 2021, Centrelink determined that, for the purposes of assessing her social security entitlements, the Applicant was not living separately and apart from her husband, Antonino Di Paolo, from 1 May 2013. Centrelink also made decisions in respect of the Applicant’s assets (owned separately and jointly with Mr Di Paolo), unexplained deposits into her bank accounts and the income and assets to be attributed to her from the Trust. Following these determinations, Centrelink made decisions on 30 September 2021 and 4 October 2021 to raise and recover from the Applicant family tax benefit debts accrued between 2013 and 2021, and totalling $64,688.06.
On 15 November 2021, a Centrelink Authorised Review Officer (ARO) affirmed these debts.
On 5 and 7 October 2021, Centrelink made further decisions and sent correspondence to the Applicant to raise and recover the following debts:
(a)$44,438.73 for parenting payments paid at the single rate (parenting payment single) from 18 July 2003 to 7 February 2007;
(b)$58,094.05 for disability support pension paid from 9 February 2007 to 9 May 2013; and
(c)$188,818.05 for disability support pension paid from 10 May 2013 to 16 September 2021.
On 15 November 2021, a Centrelink ARO affirmed the $44,438.73 parenting payment single debt and the $188,818.05 disability support pension debt, and increased the $58,094.05 disability support pension debt to $59,904.97.
The Applicant sought a review of the above decisions in the Tribunal’s Social Services and Child Support Division, which on 1 June 2022:
(a)set aside the decision that the Applicant was a member of a couple with Mr Di Paolo from 1 May 2013 and determined that the Applicant was not partnered with Mr Di Paolo from that date;
(b)set aside the decision that the Applicant has family tax benefit debts totalling $64,688.06 and determined that the Applicant does not have any family tax benefit debts because she was not partnered with Mr Di Paolo in the relevant period;
(c)affirmed the decision that the Applicant has a parenting payment single debt totalling $44,438.73 for the period 18 July 2003 to 7 February 2007, but decided to waive recovery of the entire debt pursuant to s 1237A of the Social Security Act 1991 (Cth) (Social Security Act);
(d)affirmed the decision that the Applicant has a disability support pension debt totalling $59,904.97 for the period 9 February 2007 to 9 May 2013, but decided to waive recovery of $28,206.03 of the debt pursuant to s 1237A of the Social Security Act; and
(e)affirmed the decision that the Applicant has a disability support pension debt totalling $188,818.05 for the period 10 May 2013 to 16 September 2021 and determined that the full amount is recoverable
(Tribunal first review).
On 20 June 2022, the Applicant filed an application for review of this decision to the Tribunal’s General Division. It is the outcome of that review application to the Tribunal’s General Division that is the subject of the present proceedings.
The Tribunal’s decision
The issues for determination before the Tribunal on review were:
(a)whether the Applicant has debts for the overpayment of family tax benefits in the 2013–2021 financial years (excluding the 2019–20 financial year);
(b)whether the Applicant has debts for the overpayment of:
(i)parenting payment single benefits in the period 18 July 2003 to 7 February 2007;
(ii)disability support pension benefits in the periods 9 February 2007 to 9 May 2013 and 10 May 2013 to 16 September 2021; and
(c)if so, whether any of these debts should be:
(i)written off pursuant to s 1236 of the Social Security Act or s 95 of the A New Tax System (Family Assistance) (Administration) Act 1999 (Cth) (the FAA Act);
(ii)waived pursuant to s 1237A of the Social Security Act or s 97 of the FAA Act on the basis that they are attributable solely to administrative error made by the Commonwealth; or
(iii)waived pursuant to s 1237AAD of the Social Security Act or s 101 of the FAA Act on the basis that special circumstances exist.
The determination of those issues required the Tribunal to make findings on the following issues:
(1)Whether assets and/or income from the Trust were attributable to the Applicant between 18 July 2003 and 16 September 2021 (ie, the period in which the Applicant received parenting payment single and/or disability support pension payments). This required consideration of whether the Applicant, who is named in the Trust Deed as the sole Trustee, had resigned as Trustee on 9 May 1999 and been replaced by her brother, Christopher Mandoulidis, as the Applicant contended.
(2)Whether the Applicant was a member of a couple with Mr Di Paolo in any period from 1 May 2013.
(3)Whether the Applicant held any other assets separate to the Trust, or received any income separately or jointly, between 18 July 2003 and 16 September 2021.
(4)Whether any assets or income held or received by the Applicant were above the social security assets value limit and/or income limit, such that she was not eligible for the parenting payment single or disability support pension, or the rate that she ought to have been paid was affected.
The review application hearing took place over four days, from 19 to 22 June 2023. The Applicant gave oral evidence and called the following six witnesses:
(1)Tim Pepper, a solicitor involved in the Applicant’s purported retirement from the Trust;
(2)Dr Jane Addis, the Applicant’s psychologist;
(3)Theodora Mandoulidis, the Applicant’s mother;
(4)Warren Norton, a civil services officer with the City of Boroondara Council;
(5)Katerina Cernusak, a friend of the Applicant; and
(6)Andrea Hurley, the Applicant’s carer.
The Applicant relied on written opening submissions dated 20 March 2023, closing submissions dated 8 August 2023 and reply submissions dated 2 October 2023. The Respondent relied on written closing submissions dated 18 September 2023. The Respondent did not call any witnesses. A further and final set of documents, provided to the Applicant by Centrelink in October 2023 pursuant to a Freedom of Information request (FOI release), and short submissions from the Respondent explaining why these documents were not filed prior to the hearing, were filed on 10 November 2023.
The Tribunal’s decision was handed down on 24 November 2023. In this decision, the Tribunal set aside the Tribunal first review and, in substitution, determined that:
(a)The Applicant has been a member of a couple with Mr Di Paolo from 1 May 2013 to at least 16 September 2021. The Applicant was therefore overpaid family tax benefits and has the following debts to be repaid to the Commonwealth pursuant to s 71 of the FAA Act:
(i)$3,640.33 for the 2013–14 financial year;
(ii)$3,003.95 for the 2014–15 financial year;
(iii)$4,692.12 for the 2015–16 financial year;
(iv)$19,417.75 for the 2016–17 financial year;
(v)$13,107.01 for the 2017–18 financial year;
(vi)$15,669.45 for the 2018–19 financial year; and
(vii)$5,157.45 for the 2020–21 financial year.
(b)The Applicant’s family tax benefit debts are not to be written off or waived pursuant to ss 95, 97 and 101 of the FAA Act.
(c)The reassessment of the Applicant’s entitlement to parenting payment single from 18 July 2003 to 7 February 2007 and to the disability support pension from 9 February 2007 to 16 September 2021 is remitted to the Respondent to be recalculated on the basis that the Applicant:
(i)was single from 18 July 2003 to 17 January 2009;
(ii)has been a member of a couple with Mr Di Paolo from 18 January 2009 to at least 16 September 2021;
(iii)is to be attributed 50% of the Trust’s assets from 18 July 2003 to 16 September 2021;
(iv)has assets including:
(A)100% of 2A Alexandra Avenue Canterbury from 15 December 2008 to 17 April 2009;
(B)75% of 2A Alexandra Avenue Canterbury from 18 April 2009 to 1 April 2013;
(C)50% of 2B Victoria Avenue Canterbury from 7 February 2017 to 30 June 2018; and
(v)received 50% of the rental payments from 2B Victoria Avenue Canterbury, which payments constitute income for the period 1 March 2017 to 7 May 2018.
(d)The recalculated amounts that the Applicant was overpaid in respect of parenting payment single and the disability support pension in the period 18 July 2003 to 16 September 2021 are debts due to the Commonwealth pursuant to s 1223 of the Social Security Act.
(e)The Applicant’s parenting payment single and disability support pension debts are not to be written off or waived pursuant to ss 1236, 1237A and 1237AAD of the Social Security Act.
NATURE OF APPEAL
On 22 December 2023, the Applicant appealed from the Tribunal’s decision to this Court. The Applicant’s appeal, as amended by her proposed Amended Notice of Appeal dated 30 July 2024, is limited to questions of law (AAT Act s 44; ART Act s 172).
The Applicant identified the following as the questions of law arising:
Whether the Administrative Appeals Tribunal committed an error at law by virtue of:
1.Breaching the rules of natural justice?
2.Making a decision that involved an error of law, whether or not the error appears on the record of the decision?
3.Making (at least part) of the decision without sufficient evidence or other proper basis to justify that decision?
4. Making a decision that was otherwise contrary to law?
5. Asking itself a wrong question?
6. Acting legally unreasonably or irrationally?
7. Ignoring or placing inappropriate weight on relevant evidence?
The Applicant relied on six grounds in support of her appeal. I consider each ground in turn below.
GROUND 1
Ground 1 states:
The AAT erred in its application of the evidential standard of proof, including misunderstanding and misapplying the principles derived from Briginshaw v Briginshaw [1938] 60 CLR 336 at [44], [47], and [232].
The Tribunal’s findings
The Tribunal summarised the Applicant’s submissions regarding the standard of proof at T [44]:
The Applicant’s counsel made detailed written submissions regarding the evidentiary onus and standard of proof required in this matter; in particular, the ‘significant obligations’ of the Respondent as a model litigant and the ‘grave consequences’ for Ms Di Paolo. The Applicant’s counsel submitted that the Tribunal must maintain a neutral position and that there is ‘no legal onus of proof on either party’; the ‘best evidence’ is to be preferred; and, as articulated in by [sic] the High Court in Briginshaw v Briginshaw (Briginshaw), the ‘affirmative of an allegation’ should be made out to the ‘reasonable satisfaction’ of the Tribunal, and ‘“reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect references’. Closing submissions by the Applicant’s counsel included a view that the Respondent ‘failed to identify, obtain statements from, or call witnesses’ including Mr Chris Mandoulidis (Ms Di Paolo’s brother) and Mr Tino Di Paolo to give evidence at the hearing, and assumed ‘a highly adversarial approach to the proceedings’.
(citations omitted.)
The Tribunal accepted (T [47]) that it must uphold a neutral and objective position, and “consider and weigh all the relevant evidence to ensure the correct or preferable decision is made in accordance with the objectives and requirements of the Administrative Appeals Tribunal Act 1975 (Cth)”. The Tribunal continued, stating that “[t]his includes making findings based on my ‘reasonable satisfaction’ of the evidence consistent with the decision of Briginshaw”.
Later in its reasons (T [232]), the Tribunal said as follows in explaining the approach it took to determining the Applicant’s attributable share of Trust assets:
To be very clear, I have only considered assets attributed to Ms Di Paolo from the Trust or otherwise and income received by Ms Di Paolo where I am satisfied the evidence is indisputable. Consistent with the decision in Briginshaw, I have been careful not to draw adverse inferences except where I have ‘reasonable satisfaction’ regarding the evidence.
(emphasis in original.)
The parties’ principal submissions
The key principle in Briginshaw v Briginshaw (1938) 60 CLR 336 (Briginshaw) was articulated by Dixon J (as his Honour then was) at 362:
But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters “reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect inferences.
The Applicant accepted that there is no principle of law requiring the Tribunal to apply Briginshaw: citing Sullivan v Civil Aviation Safety Authority (2014) 226 FCR 555; [2014] FCAFC 93 (Sullivan) at [114] (Flick and Perry JJ). However, the Applicant relied on the following statement of Flick and Perry JJ in Sullivan (at [120]):
When making findings of fact which have “serious” consequences to a party, or “grave” consequences, the tribunal is free to consider the evidence and other materials before it. The more centrally relevant a particular fact may be to the decision reached, the tribunal it may be accepted would express greater caution in evaluating the factual foundation for the decision to be reached.
The Applicant contended that the Tribunal inaccurately summarised her submissions regarding the application of Briginshaw by stating (at T [44]) that:
[T]he ‘affirmative of an allegation’ should be made out to the ‘reasonable satisfaction’ of the Tribunal, and ‘“reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect references’.
The Applicant submitted that, while the Tribunal was not obliged to apply Briginshaw (in light of Flick and Perry JJ’s findings in Sullivan), once the Tribunal chose to apply Briginshaw it was obliged to apply it correctly. The Applicant cited Plaintiff M61/2010E v Commonwealth (2010) 243 CLR 319; [2010] HCA 41 (Plaintiff M61) at [78] (the Court) and Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123; [2018] HCA 34 (Hossain) at [28]–[29] (Kiefel CJ, Gageler and Keane JJ), to contend that the Tribunal was required to “proceed by reference to correct legal principles, correctly applied”. The Applicant submitted that the Tribunal had erroneously applied “reasonable satisfaction” as a standalone standard of proof and had failed to apply the key principle from Briginshaw: “specifically the drawing and applying of a nexus between the nature and gravity of the consequences and the standard of proof required.”
The Respondent submitted that the Tribunal carried out its fact-finding task as required under s 33(1) of the AAT Act. The Respondent referred to the Applicant’s closing submissions before the Tribunal, which argued that the Tribunal was bound to make all findings of fact to the Briginshaw standard because all findings might have serious or grave consequences for her. The Respondent accepted that the Tribunal’s decision “did not embrace the entirety of the ‘rule’ in Briginshaw v Briginshaw”, but submitted that even if it had done so the only finding of fact that could fall within the Briginshaw rule was the finding that the Applicant had knowingly and deliberately altered various Trust documents.
In her reply submissions, the Applicant rejected that the only finding of fact attracting the Briginshaw rule was the finding that Trust documents had been knowingly and deliberately altered, noting Flick and Perry JJ’s statement in Sullivan that “having engaged in fraud or having lied” were “but examples” of findings to which the rule would apply (at [111]).
In oral submissions, the Applicant argued that the application of Briginshaw depends on the facts of each case and whether or not Briginshaw is sought to be relied upon. The Applicant submitted that, in this case, Briginshaw was relied on in relation to the “full gamut” of evidence because the consequences of the findings at issue were significant in the analysis of matters that ultimately resulted in the Applicant being found to have a large debt for overpaid benefits.
The Applicant also characterised the Respondent’s statement that the Tribunal “did not embrace the entirety” of Briginshaw as a concession, arguing that this was significant because the Tribunal did not suggest it was intending only to embrace part of, or an incomplete version of, Briginshaw, and because the Respondent had failed to articulate which “portion” of Briginshaw was in fact embraced. The Applicant reiterated in oral submissions that “once a principle is to be applied, then you can’t break up that principle. Then it’s no longer the principle that it stands for, and the tribunal would be applying another principle entirely”.
In oral submissions, the Respondent proposed to insert “explicitly” into his written submission that the Tribunal “did not [explicitly] embrace the entirety of the ‘rule’ in Briginshaw v Briginshaw”. The Respondent accepted that the Tribunal appeared to apply the Briginshaw standard to some issues (such as the income and assets to be attributed to the Applicant) and not others (such as whether the Applicant was a member of a couple in the relevant periods) without clearly articulating why it had done so, but submitted that this did not reveal any error of law.
Consideration
The Applicant acknowledges that the Tribunal was not obliged to apply the Briginshaw standard, but says that it must apply it properly, if it is to be applied. As is apparent from the extract from Briginshaw set out above, the key point in applying the Briginshaw standard is that the question of whether a particular issue has been proved to the “reasonable satisfaction” of the decision-maker is sensitive to matters including the seriousness of the allegation and the consequences flowing from a particular finding.
Whether or not the Tribunal misstated her argument at T [44] (as the Applicant contends) is not to the point if it did not in fact misapply the Briginshaw standard, as she contends. The Applicant relies on T [47] and [232] as showing that the Tribunal wrongly treated “reasonable satisfaction” as a “standalone standard of proof” when it should have drawn and applied a “nexus between the nature and gravity of the consequences and the standard of proof required”.
Neither of the cited passages of the Tribunal’s decision make good the Applicant’s complaint.
The Tribunal’s observation at T [47] does not suggest any misunderstanding or misapplication of the Briginshaw standard. In that paragraph, the Tribunal merely said that its approach to reaching the correct or preferable decision in accordance with the (then in force) AAT Act included making findings based on its “‘reasonable satisfaction’ of the evidence consistent with the decision of Briginshaw”. While the Tribunal’s reference to “‘reasonable satisfaction’ of the evidence” may have been slightly inelegant given that Briginshaw addresses reasonable satisfaction as to an “issue”, nothing turns on that here. The Tribunal’s reasons must be read as a whole, fairly and without focusing on imprecision in language, or with an eye finely attuned to error: Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 (Wu Shan Liang) at 272 (Brennan CJ, Toohey, McHugh and Gummow JJ), cited in Comcare v Power (2015) 238 FCR 187; [2015] FCA 1502 at [38] (Katzmann J) and Sullivan at [124] (Flick and Perry JJ).
The other passage relied on by the Applicant, T [232], also does not reveal any error. What the Tribunal made clear there was that it had proceeded cautiously, had only considered assets attributable to the Applicant where satisfied that the evidence was “indisputable” and had been careful not to draw adverse inferences except where it had “‘reasonable satisfaction’ regarding the evidence”.
The Tribunal’s caution in only attributing assets to the Applicant where the evidence was “indisputable” demonstrates the Tribunal’s application of the approach referred to in Briginshaw. The final sentence of the passage, in which the Tribunal referred to “‘reasonable satisfaction’ regarding the evidence”, exhibits the same inelegant language as T [47], but, read fairly and in context, is clearly a reference back to the observation that the Tribunal had just made, namely that it was only proceeding on the basis of “indisputable” evidence in relation to the issue of the assets to be attributed to the Applicant. There is no error of law in that approach.
For completeness, I note that the Applicant supported her contention that, although the Tribunal is not required to apply the Briginshaw standard, if it does it must do so correctly, by citing Plaintiff M61 at [78] (the Court) and Hossain at [28]–[29] (Kiefel CJ, Gageler and Keane JJ). Neither of the passages cited support that contention, but it is not necessary to further address this issue as I have rejected ground 1 on the basis that the Applicant has not established any misapplication of the Briginshaw standard.
The Applicant’s submission that the Tribunal erred by not applying Briginshaw to the “full gamut” — ie every fact and issue arising for determination by the Tribunal — lacks merit. There is no basis upon which to suggest that each and every issue required consideration on the Briginshaw standard simply because the consequences for the Applicant of an adverse decision — resulting in a liability to repay overpaid benefits — were significant for the Applicant. Not only was the Tribunal not obliged to apply the Briginshaw standard at all, there was no error of law in it applying that standard only to some issues. Nor do the observations of Flick and Perry JJ in Sullivan, which were relied on by the Applicant, suggest that the Tribunal erred in law by not applying an elevated standard of satisfaction to all issues.
GROUND 2
Ground 2 states:
The AAT erred in its application of the evidential onus of proof, including erroneously placing a practical onus on the Applicant (e.g. at [48]-[56]).
The Tribunal’s findings
The Tribunal noted (T [48]) that the gaps and inconsistencies in the documents filed by both parties made its fact-finding process difficult and time-consuming. With respect to the Applicant specifically, the Tribunal stated (T [49]) that the Applicant’s continued eligibility for social security payments required her to declare all personal and financial circumstances to Centrelink, as well as any changes to her circumstances within 14 days. The Tribunal noted further that the Applicant was the only person with all relevant information about her circumstances during the 18-year period in which she received social security payments, concluding that (T [50]):
[P]articularly where there are gaps and inconsistencies in the documentary evidence … there is [a] clear onus on Ms Di Paolo – as the person whom this matter is about and who has been advised of her obligations to inform Centrelink about her circumstances – to assist (as best as she is able) to fill in the gaps and explain inconsistencies in the documents.
While the Applicant stated in oral evidence before the Tribunal that she told Centrelink “every part of [her] life” and had kept her own notes of her interactions with Centrelink staff, the Tribunal noted (T [51]) that she had not filed any such documents with the Tribunal, which records “may have assisted to clarify facts in this matter” (emphasis in original). Further, the Tribunal found the Applicant’s oral evidence to be “frequently ambiguous, opaque and abstruse” and to seriously undermine her credibility (T [52]). The Tribunal therefore “considered but placed minimal weight on her oral evidence where it [was] inconsistent with contemporaneous documentary evidence and/or credible witnesses” (T [52]).
The Tribunal said that “given the issues with the evidence” that it had just outlined, the Applicant may have been assisted by evidence at the hearing from Mr Mandoulidis, but observed that it was the Applicant who said he could not give evidence, even by phone, and provided a medical certificate in respect of Mr Mandoulidis (T [53]–[54]). As to Mr Di Paolo, the Tribunal recorded that the Applicant had been in touch with him the day before the hearing commenced but had not asked him whether he would give evidence (T [54]), the consequence being that there was limited evidence from Mr Di Paolo before the Tribunal, being only a brief letter (T [55]).
The Tribunal stated explicitly that it would “make no adverse findings about the absence of Mr Mandoulidis and Mr Di Paolo as witnesses” and observed that “their evidence may have assisted to clarify or complete gaps in the evidence presented by the Applicant” (T [56]) (emphasis in original).
The parties’ principal submissions
The Applicant submitted that the Tribunal had erroneously placed an evidentiary onus upon her to remedy the gaps and inconsistencies in the documentary record, despite acknowledging that such gaps appeared in documents filed by both parties, the significant resource imbalance in favour of the Respondent, the obligation on the Respondent to act as a model litigant and the numerous witnesses that the Respondent could and should have called. The Applicant submitted that the Tribunal, in effect, required the Applicant to prove her case rather than independently conducting a merits review.
The Respondent submitted that, when regard is had to the Tribunal’s decision as a whole, it is clear the Tribunal did not regard the Applicant as bearing any evidentiary onus. In support of this contention, the Respondent cited McDonald v Repatriation Commission (1984) 1 FCR 354; [1984] FCA 59 (McDonald), where Woodward J stated at 358:
It is true that facts may be peculiarly within the knowledge of a party to an issue, and a failure by that party to produce evidence as to those facts may lead to an unfavourable inference being drawn — but it is not helpful to categorise this common-sense approach to evidence as an example of an evidential onus of proof. The same may be said of a case where a good deal of evidence pointing in one direction is before the Tribunal, and any intelligent observer could see that unless contrary material comes to light that is the way the decision is likely to go.
The Respondent also quoted the following extract of East v Repatriation Commission (1987) 16 FCR 517; [1987] FCA 24 (East) at 534 (Jenkinson, Neaves and Wilcox JJ):
[T]he practical situation remains that it will often be in the interests of a party to proceedings before the Tribunal to adduce particular evidence; the reason being that, in the absence of that evidence, the Tribunal will not be free to make the decision sought by that party. In a case where that party apparently makes a conscious decision, with the benefit of legal advice, not to deal with that matter the Tribunal would be justified in assuming that the party had no evidence on the point which would assist the case: cf Jones v Dunkel (1959) 101 CLR 298.
The Respondent submitted that the use of the term “onus” in the Tribunal’s statement that the Applicant had a “clear onus … to assist [the Tribunal] (as best as she is able) to fill in the gaps and inconsistencies in the documents” was used in the sense described in McDonald and East above — to communicate that, as a matter of practicality, it was in the Applicant’s interest to adduce evidence that was peculiarly within her knowledge or control. The Respondent argued that the Tribunal’s decision not to draw any adverse inferences against the Applicant for failing to call Mr Di Paolo or Mr Mandoulidis to give evidence, despite offering no explanation for not doing so, confirms that the Tribunal did not regard the Applicant as bearing any evidentiary onus of proof.
The Applicant responded in her reply submissions that she had provided medical evidence establishing that Mr Mandoulidis was unavailable to give evidence, and that this issue was not disputed at hearing. As outlined above, the Tribunal noted this medical evidence in its decision.
At the hearing before this Court, the focus of the Applicant’s submissions shifted from the onus allegedly placed on the Applicant by the Tribunal to the failure of the Respondent to discharge the “practical onus” he bore “to establish the existence and size of the debt”. The Applicant relied upon Prygodicz v Commonwealth (No 2) [2021] FCA 634 at [7], where Murphy J stated:
It is fundamental that before the state asserts that its citizens have a legal obligation to pay a debt to it, and before it recovers those debts, the debts have a proper basis in law. The group of Australians who, from time to time, find themselves in need of support through the provision of social security benefits is broad and includes many who are marginalised or vulnerable and ill-equipped to properly understand or to challenge the basis of the asserted debts so as to protect their own legal rights. Having regard to that, and the profound asymmetry in resources, capacity and information that existed between them and the Commonwealth, it is self-evident that before the Commonwealth raised, demanded and recovered asserted social security debts, it ought to have ensured that it had a proper legal basis to do so.
(emphasis added.)
As the argument developed orally, the Applicant retreated somewhat from her initial criticism of the Tribunal’s statements concerning the “onus” on her to “fill in the gaps and inconsistencies in the documents”. It was submitted by the Applicant that that statement was not “overly problematic” per se — rather, the problem was that the Tribunal had not made any similar statement in respect of the Respondent’s corresponding obligation. The Applicant argued, by way of example, that during the hearing the Tribunal had, in effect, required the Applicant to disprove the allegation that certain deposits into her bank accounts were income, as opposed to the Respondent adducing evidence to substantiate the allegation.
The Applicant argued that the Respondent was required to establish an evidentiary basis for the Applicant’s debts, and criticised the Respondent for failing to call witnesses who could have assisted this enquiry. The Applicant referred to her submission, made to the Tribunal, that the Respondent should have called all the Centrelink officers who dealt with the Applicant over an 18-year period, and who prepared internal records “during or around” the relevant period.
In oral submissions, the Respondent emphasised that calling all witnesses proposed by the Applicant (including “[a]ny Centrelink officers who interacted with the applicant and purported to author internal records during or around the relevant debt periods”) would have unduly extended the hearing and may have constituted a breach of the obligation in s 33(1AB) of the AAT Act to, amongst other things, use best endeavours to assist the Tribunal to provide a mechanism of review that is economical, informal and quick. The Respondent submitted further that there was an “air of artificiality” to the Applicant’s position, in circumstances where the Applicant had made no application to call or summons any of the proposed witnesses to give evidence. In relation to the unexplained bank deposits specifically, the Respondent noted that the Tribunal had considered the bank deposits issue at T [218]–[222], before concluding at T [222(a)] that it did not have sufficient evidence to determine that the deposits constituted income.
In reply oral submissions, the Applicant reiterated that, even if the hearing had extended over weeks, given the quantum of the debts and the gravity of the outcome to the Applicant, “it would certainly not be unreasonable, at least from the applicant’s perspective, to have provided the opportunity to examine those witnesses and for the hearing to extend over such a period of time”.
Consideration
There is no merit in ground 2. I will deal first with the contentions advanced in the written submissions, before turning to the matters raised in the oral submissions.
The Applicant particularly focused on the Tribunal’s reference (T [50]) to there being a “clear onus” on the Applicant to assist, as best she could, to fill gaps and explain inconsistencies in the documents.
The point that the Tribunal was making was that there were gaps and inconsistencies in the evidence, and it was the Applicant, being the person whose affairs were in issue, who had been receiving social security payments for 18 years, and who had an obligation to tell Centrelink about her personal and financial circumstances, who had the practical ability to fill in the gaps and explain the inconsistencies in the evidence. This involved the Tribunal doing no more than that which Woodward J referred to in McDonald at 358:
It is true that facts may be peculiarly within the knowledge of a party to an issue, and a failure by that party to produce evidence as to those facts may lead to an unfavourable inference being drawn – but it is not helpful to categorise this commonsense approach to evidence as an example of an evidential onus of proof. The same may be said of a case where a good deal of evidence pointing in one direction is before the Tribunal, and any intelligent observer could see that unless contrary material comes to light that is the way the decision is likely to go.
It should be recalled that, in Wu Shan Liang at 271–2, Brennan CJ, Toohey, McHugh and Gummow JJ endorsed statements of the Full Court below that an administrative decision-maker’s reasons are “entitled to a beneficial construction” and also referred with approval to the observations of the Full Court (Neaves, French and Cooper JJ) in Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287 that a court should not be “concerned with looseness in the language … nor with unhappy phrasing” in the reasons of an administrative decision-maker, and that “[t]he reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error”. As Brennan CJ, Toohey, McHugh and Gummow JJ went on to say, “the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed” (at 272). Similarly, as Kirby J observed (at 291):
The reasons under challenge must be read as a whole. They must be considered fairly. It is erroneous to adopt a narrow approach, combing through the words of the decision-maker with a fine appellate tooth-comb, against the prospect that a verbal slip will be found warranting the inference of an error of law.
(citations omitted.)
The Tribunal’s use of the term “onus” was inapt and unhelpful, but, read fairly and as a whole, the isolated reference to “onus” does not demonstrate that the Tribunal actually misunderstood its task or proceeded on the basis that the Applicant bore a legal onus.
The Applicant’s contentions regarding the Tribunal’s treatment of the absence of Mr Mandoulidis and Mr Di Paolo also lacks merit. The Tribunal did not, as the Applicant contends, unfairly place an evidentiary onus on her. All the Tribunal did was recognise that their evidence could have been helpful to the Applicant, but did so on the basis that it was not making any adverse finding about their absence.
The submissions made by the Applicant orally also lack merit. I do not consider that the Tribunal erred in law by not making any “like for like” suggestion that the Respondent bore an onus, that was equivalent to the remarks made about the practical onus on the Applicant in the circumstances. As I have set out above, the Applicant’s suggestion that there was some lack of parity was founded on the contention that the gaps and inconsistencies in the Centrelink records before the Tribunal could also have been addressed by the Respondent calling all the Centrelink officers who dealt with the Applicant over many years. As the Tribunal identified, it was the Applicant who had all those dealings with Centrelink, and who claimed to have kept notes of her interactions, which notes she had not produced. The suggestion that the Respondent should have called all the Centrelink staff who dealt at any point with the Applicant is patently absurd.
As to the suggestion that the Tribunal required the Applicant effectively to disprove the existence of the debts, the only example given by the Applicant of this issue concerned bank deposits being treated as income. However, as the Respondent submitted, the Tribunal found that there was insufficient evidence to conclude that the deposits were income (T [222(a)]). There is no foundation for the suggestion that the Tribunal imposed an onus on the Applicant requiring her to disprove the existence of the asserted overpayments.
GROUND 3
Ground 3 states:
The AAT erred in its consideration of whether the Applicant had been removed as an Appointor and Trustee, including misunderstanding, and misapplying the requirements of section 41 of the Trustees Act (see e.g. at [96]-[103]).
The Tribunal’s findings
The Tribunal was required to make findings in respect of whether assets and/or income from the Trust were attributable to the Applicant in the period 18 July 2003 to 16 September 2021 — being the period in which the Applicant received parenting payment single and/or disability support pension payments.
The Trust Deed named the Applicant as the sole Trustee of the Trust and provided that, to remove and appoint Trustees, the three persons named as Appointor — the Applicant, Mr Mandoulidis and their mother, Mrs Mandoulidis — are required to “act jointly”. In determining that the Applicant was to be attributed 50% of the Trust assets in the period 18 July 2003 to 16 September 2021, the Tribunal found that the Applicant had not resigned as Trustee, beneficiary or Appointor of the Trust in accordance with the terms of the Trust Deed, whether on 9 May 1999 (as the Applicant contended) or any other date.
The Tribunal reached this conclusion on the basis that there was no evidence that the Appointor had acted jointly to remove the Applicant as a Trustee or beneficiary of the Trust, drawing attention in particular to the absence of Mrs Mandoulidis’ signature on core documents relied upon by the Applicant (T [96(c)]). The Tribunal rejected the Applicant’s oral evidence regarding her purported date of retirement, having placed “significant weight” on Mr Pepper’s evidence that he did not prepare the Deed of Retirement document until after the year 2000 (T [96(e)]). Mr Pepper was a solicitor who prepared documents effecting a change in the Trustee of the Trust, three different copies of which were in evidence, bearing two different dates (according to the schedule prepared by the Respondent after the hearing).
The Tribunal noted further that the Applicant’s oral evidence was inconsistent with, for example, Trust financial statements and reports referring to the Applicant as having: received distributions as a beneficiary, a share of profits and “current liabilities” in various years between 1999 and 2021, and recording her change of surname from ‘Napoli’ to ‘Di Paolo’ in 2011 (T [96(f)]). The Tribunal concluded that “the date on documents filed by Ms Di Paolo with the Tribunal to verify she retired from the Trust on 9 May 1999 [had] been knowingly and deliberately altered” (T [96(g)]) (emphasis added).
The Tribunal then turned to consider the Applicant’s submission that she had effected her retirement as Trustee pursuant to s 41 of the Trustee Act 1958 (Vic) (Trustee Act). Section 41 of the Trustee Act relevantly provides:
41 Power of appointing new or additional trustees
(1)Where a trustee is dead, or remains out of Victoria for more than one year without having properly delegated the execution of the trust, or desires to be discharged from all or any of the trusts or powers reposed in or conferred on him or refuses or is unfit to act therein, or is incapable of acting therein, or is a minor, then, subject to the restrictions imposed by this Act on the number of trustees—
(a) the person or persons nominated for the purpose of appointing new trustees by the instrument (if any) creating the trust; …
may, by writing, appoint one or more other persons (whether or not being the persons exercising the power) to be a trustee or trustees in the place of the trustee so deceased, remaining out of Victoria, desiring to be discharged, refusing, or being unfit, or being incapable, or being a minor as aforesaid.
…
(10) The provisions of this section relative to a person nominated for the purpose of appointing new trustees apply, whether the appointment is to be made in a case specified in this section or in a case specified in the instrument (if any) creating the trust, but where a new trustee is appointed under this section in a case specified in that instrument, the appointment shall be subject to the terms applicable to an appointment in that case under the provisions of that instrument.
(emphasis added.)
For reasons including those outlined at paragraphs 68 and 69 above, the Tribunal was not satisfied that the Applicant had retired from the Trust because “her actions since 1999 do not show she has desired ‘to be discharged from’ the Trust or the ‘powers reposed in or conferred on’ her as Trustee of the Trust” (T [103]).
The parties’ principal submissions
The Applicant advanced two key arguments in support of her contention that the Tribunal had erred in its consideration of this issue.
First, the Applicant contended that the Tribunal had erroneously concluded that the Applicant had not genuinely resigned from the Trust before it considered the application of s 41 of the Trustee Act. The Applicant argued that it was not open to the Tribunal to make this finding without first considering that statutory provision.
Secondly, the Applicant submitted that when considering whether the Appointor had “acted jointly”, the Tribunal erroneously asked, in effect, whether a single document had been signed by each of Mrs Mandoulidis, Mr Mandoulidis and the Applicant. The Applicant noted that cll 1, 25 and 28 of the Trust Deed, read together, provided for the removal and/or appointment of a Trustee or Appointor in circumstances where the relevant act was “in writing” and where the Appointor “acted jointly”. However, the Applicant submitted that there was nothing in the Trust Deed, s 41 of the Trustee Act or “at law” requiring a single document to be signed by all parties, or for a single document to be signed at the same time.
The Applicant submitted that, absent the errors of law for which she contended, it would have been open to the Tribunal to find that the requirements of the Trustee Act and Trust Deed had been complied with, whether on 9 May 1999 or some later date. The Applicant advanced 16 March 2004 as an alternative date, being the date when Mrs Mandoulidis and Mr Mandoulidis each wrote letters recording that they and the Applicant had met with a solicitor following the death of the Applicant’s father in 1999 to amend the Trust so Mr Mandoulidis had full control over Trust matters. When questioned in oral submissions about Mrs Mandoulidis’ evidence that another solicitor besides Mr Pepper was involved in this process, the Applicant was unable to confirm which document (if any) in the evidentiary record was produced by the solicitor to amend the Trust Deed.
The Respondent submitted that the Tribunal’s approach of looking first to the Trust Deed, and then to the Trustee Act, is consistent with conventional practice and conforms with s 2(3) of the Trustee Act by which, the Respondent submitted, “the operation and effect of that Act is subject to, and overridden by, any contrary intention in the trust instrument”. The Respondent submitted further that the Applicant’s second argument is premised upon a misreading of the Tribunal’s decision. The Respondent accepted that evidence of the Appointor acting jointly could be given by persons recording their assent in writing across several documents, but argued that this ordinarily occurred contemporaneously with the decision being made, and maintained that the Applicant had failed to produce any evidence that her mother had acted jointly with the Applicant and Mr Mandoulidis to remove the Applicant as a Trustee and beneficiary of the Trust.
In support of the proposition that it is conventional practice to look first to the trust instrument and then to the applicable trustee legislation, the Respondent cited Young PW, Croft C and Smith ML, On Equity (Lawbook, 2009) at [6.1250], which relevantly provides:
Where a vacancy in the office needs to be filled, the trust instrument will usually provide for this. If, however, the trust instrument is silent or insufficient on this issue, the statute provides for appointment by the remaining trustees, usually by registered deed, or else the court will make the necessary appointment.
(emphasis added.)
In her reply submissions, and despite the Respondent’s statement to the contrary, the Applicant characterised the Respondent’s submissions as predicated on “an erroneous interpretation of ‘acting jointly’ as impliedly requiring a single document signed by all appointers”. The Applicant also reiterated that even the “conventional approach” of looking first to the trust instrument did not preclude the application of the Trustee Act.
The Respondent clarified in oral submissions that he did not contend the Trust Deed overrode the Trustee Act; rather the submission was that “if something is said to have happened under the trust deed, that is considered first, and then if there’s an alternative route to whatever outcome is sought, then we go to the Trustee Act”. The Respondent contended that the Applicant had positioned the two — the terms of the Trust Deed and s 41 of the Trustee Act — as alternatives before the Tribunal, but sought, on the appeal, to contend that they had to be considered in tandem, and that the Tribunal erred in considering them separately.
The Respondent submitted that it was “common ground” at the hearing before the Tribunal that there had not been compliance with the terms of the Trust Deed. The Respondent argued that Mrs Mandoulidis’ 16 March 2004 letter did not satisfy the “in writing” requirement because it did not itself record the retirement or replacement of the Applicant as Trustee; it merely described a family meeting at which Mrs Mandoulidis and her husband purportedly decided to give “full control” of the Trust to their son, Mr Mandoulidis, and a further meeting with a solicitor to amend the Trust to give effect to that decision. The Respondent reiterated that Mrs Mandoulidis had not signed any of the various documents said to effect the Applicant’s retirement or replacement as Trustee, and that there was therefore no decision in writing by the Appointor for the purposes of either the Trust Deed or Trustee Act. The Respondent argued that there was no error in the Tribunal’s conclusion regarding s 41 of the Trustee Act, as that provision was not enlivened because of the Tribunal’s factual conclusion that the Applicant did not desire “to be discharged from” the Trust or the “powers reposed in or conferred on” her as Trustee. The Respondent also submitted that the potential involvement of another solicitor was not the subject of evidence or submissions before the Tribunal and should not be examined by the Court.
In oral reply submissions, the Applicant rejected the Respondent’s characterisation of her submissions, arguing that the “Trustee Act is to be considered in conjunction with the [trust] instrument” (emphasis added). The Applicant accepted that she had argued before the Tribunal that her replacement by Mr Mandoulidis as Trustee had been effected through s 41 of the Trustee Act.
Consideration
I do not accept that the Tribunal erred in law in either of the respects contended for.
There is no legal error in the Tribunal’s approach of first considering whether the Applicant had effectively been removed pursuant to the terms of the Trust Deed, and then considering whether the Applicant effected her own retirement pursuant to the Trustee Act.
The Tribunal’s analysis, which led to it concluding that the Applicant had not been removed as a Trustee pursuant to the applicable terms of the Trust Deed, is set out in T [96(a)–(f)]. Subject to the separate contention regarding whether the Tribunal misconstrued the Trust Deed in concluding that the Appointor — the Applicant, Mr Mandoulidis and Mrs Mandoulidis — had not “acted jointly” to remove the Applicant as Trustee or beneficiary of the Trust, there is no legal error in the methodology of first considering removal under the terms of the Trust Deed, before considering the application of the Trustee Act.
In addition, it is not apparent how any error of law could arise from the Tribunal’s consideration of retirement under the terms of the Trust Deed and the Trustee Act sequentially when the Applicant’s argument before it was that she had been removed as Trustee pursuant to s 41 of the Trustee Act (and not some combination of the two). Tellingly, the Applicant’s closing submissions before the Tribunal in this context framed the “two main questions” as follows:
(a)Was the applicant’s purported retirement as trustee authorised by the Trust Deed?
(b)In the alternative, was the applicant’s purported retirement as trustee authorised by statute?
(emphasis added.)
While the Applicant’s argument was a bit difficult to follow at times, it appears that an additional point was made to the effect that it was not open to the Tribunal to find, at T [98], that it was “not satisfied that Ms Di Paolo has relinquished all beneficial interest in and genuinely resigned from the Trust” before considering s 41 of the Trustee Act. The Tribunal referred, at T [97], to the Australian Government Social Security Guide (the Guide) which listed requirements for a “genuine resignation” from a trust, which included that a person will “relinquish all beneficial interest” in a trust. Having referred to that Guide, the Tribunal moved to set out its reasons for concluding that it was not satisfied of those matters in relation to the Applicant.
The chapeau of T [98] commences with the words “[b]ased on the following findings of fact, I am not satisfied … [etc]”. The remainder of T [98] sets out a number of factual findings concerning the affairs of the Trust and the Applicant’s actions. Those findings included reference to numerous documents evidencing the Applicant’s ongoing involvement in the affairs of the Trust, and receipt of benefits from it.
I can discern no error in law in the Tribunal setting out those findings of fact before separately addressing (at T [103]) the question of whether, nonetheless, the Applicant had “retired from the Trust” pursuant to the Trustee Act. Indeed, that was the approach commended to the Tribunal by the Applicant’s closing submissions before it. In concluding that it was not satisfied that the Applicant had effected her retirement from the Trust, the Tribunal said that conclusion was reached as the Applicant’s own actions since 1999 did not show a desire to be discharged from the Trust, or the powers reposed in or conferred on her as Trustee. The Tribunal there referred back to its factual findings at T [96] and [98]. Again, nothing turns on the order in which the Tribunal considered these matters; it does not reveal any error of law.
The Applicant also contended that the Tribunal erred in law by wrongly approaching the question of whether the Appointor (being the three persons named above) “acted jointly” on the basis that it was necessary to identify a single document signed by the three individuals.
The Tribunal set out at T [61] the documents relied on by the Applicant as showing she resigned from the Trust on 9 May 1999. As the Tribunal set out, a number of those documents were inconsistent in several respects. Then, at T [96(c)], the Tribunal found that none of the documents referred to at T [61(a)–(h)] had been signed by Mrs Mandoulidis at all. Contrary to the Applicant’s submission, the Tribunal did not construe the terms of the Trust Deed as requiring that the three individuals constituting the Appointor had to have signed the same document. Rather, what the Tribunal pointed out was that one of the three individuals (ie Mrs Mandoulidis) had not signed any of the documents that purported to effect the change in Trustee, added to which there were deficiencies in all of the documents referred to at T [61(a)–(h)].
The Tribunal’s rejection (at T [96(d)]) of the letter signed by Mrs Mandoulidis on 16 March 2004 was on the basis that the letter had no legal effect regarding the Applicant’s resignation from the Trust. That conclusion does not involve legal error. The letter did not purport to effect any change in the identity of the Trustee. Rather the letter referred to a family meeting in early 1998 where a decision was said to have been made to change the Trustee, and it was said that a solicitor was then consulted in 1999 to amend the Trust Deed. None of the multitude of varying and contradictory documents before the Tribunal made good the suggestion that a solicitor had drawn up, and the necessary persons had executed, any amendment of the Trust Deed consistent with Mrs Mandoulidis’ suggestion.
To the extent the Applicant submitted that the Tribunal’s approach to the Trustee Act also involved wrongly proceeding on the basis that there had to be a single document executed by all three individuals constituting the Appointor, that argument is also misconceived. As noted above, the Tribunal’s conclusions regarding the Trustee Act (T [103]) referred back to the findings of fact at T [96] and [98]. The matters that the Tribunal there referred to did not include any suggestion that all the individuals constituting the Appointor had to sign the very same document effecting a change in the Trustee.
As this ground overlaps with ground 5, my reasons in relation to ground 3 should be read alongside ground 5.
GROUND 4
Ground 4 states:
The AAT failed to perform its irreducible jurisdictional task and or afford the applicant procedural fairness by failing to engage in a meaningful way with the Applicant’s case and or consider relevant submissions, including those relating to:
a.The inherent risks of relying on internal documentary records and inferences drawn from those records, specifically where such evidence was obviously incomplete or likely incomplete (e.g. at [42], [193] and [258]-[260]), and or
b.The failure of the Respondent to obtain or call relevant evidence, particularly in circumstances where it was acting as a model litigant, and the resulting unfairness caused to the Applicant, including consideration of the application of Jones v Dunkel (1959) 101 CLR 298.
The Tribunal’s findings
Paragraph 42 of the Tribunal’s reasons, which is referred to in the ground of appeal, is a paragraph in which the Tribunal set out a “timeline of properties owned by Ms Di Paolo (individually and jointly) between 2003 and 2021”. The Tribunal referred back to this analysis at T [193] (also referred to in the ground of appeal) and said it was “satisfied there is no evidence before this Tribunal that Ms Di Paolo informed Centrelink about the details of these transactions at the relevant time” (emphasis in original). The Tribunal again referred back to that analysis at T [258], stating that, as identified, there are “no contemporaneous Centrelink (or other) records about the purchase, building and/or sale of these properties”, before noting that the Tribunal had not found any evidence that shows the Applicant informed Centrelink about various matters concerning the properties.
The Tribunal observed at T [259]:
A review of Centrelink records from 2003 to 2021 shows that Ms Di Paolo had regular contact with Centrelink: these records document her contact regarding other social security and associated payments (carer allowance, rent assistance) she was receiving, changes to her addresses, and details about the care arrangements of her three older children. It is unclear why Centrelink appears to have maintained comprehensive records about many aspects of Ms Di Paolo’s circumstances but not her purchase, building and sale of properties. This is particularly the case in the absence of any contemporaneous notes or records Ms Di Paolo says she maintained from her interactions with Centrelink. Weighing all the evidence, I am not satisfied that Ms Di Paolo’s parenting payment single and disability support pension debts can be solely attributed to Centrelink not keeping accurate records of Ms Di Paolo’s situation.
(emphasis added.)
Based on those findings, the Tribunal concluded at T [260] that it was “not satisfied there are grounds to waive Ms Di Paolo’s parenting payment single and disability support pension debts pursuant to section 1237A of the Social Security Act”.
This ground of appeal also raises the failure of the Respondent to call certain evidence and the application of Jones v Dunkel (1959) 101 CLR 298 (Jones v Dunkel). The Tribunal noted (at T [44]) the Applicant’s submissions regarding the Respondent’s failure to call witnesses, including Mr Di Paolo and Mr Mandoulidis. The Tribunal cited the Applicant’s closing submissions, where the Applicant argued that “it was appropriate and necessary for the respondent to call and make available relevant witnesses to adduce evidence and substantiate or corroborate written documentary evidence and or the inferences that were sought to be drawn from documentary evidence” and invited the Tribunal to draw the inference that the potential witnesses’ evidence would not have assisted the Respondent’s case: citing Jones v Dunkel. However, the Tribunal also noted (at T [45]) the Respondent’s contention that the failure to call Mr Di Paolo and Mr Mandoulidis was not his responsibility, and (at T [54]) that the Respondent had requested, at a directions hearing, that Mr Mandoulidis attend the hearing in person to give oral evidence, whereupon the Applicant produced a generic medical certificate in support of his unavailability to give evidence. The Tribunal observed the Applicant “may have been assisted” (emphasis in original) had those individuals given evidence, but stated explicitly that it was not making any adverse findings against the Applicant due to their absence (T [53] and [56]). The Tribunal did not expressly address the Applicant’s Jones v Dunkel submissions (as outlined above) in its decision.
The parties’ principal submissions
The Applicant argued that the Tribunal’s failure meaningfully to engage with her case amounted to a denial of procedural fairness. The Applicant submitted that she had highlighted to the Tribunal that documents held by Centrelink were not reliable or comprehensive, and that this was affirmed by the FOI release documents, which revealed over 250 pages of relevant but previously undisclosed documents in the Respondent’s possession. The Applicant submitted that she had urged caution on the Tribunal in drawing inferences from the documentary record in the absence of corroborating oral testimony where the Respondent had failed to provide a reasonable explanation for the absence of such witnesses. The Applicant had invited the Tribunal to draw a Jones v Dunkel inference that the evidence of these witnesses would not have assisted the Respondent’s case. The Applicant had also advanced arguments regarding the need to consider the diminished capacity of the parties to adduce evidence when evaluating the evidence.
The Applicant contended that the Tribunal failed to engage with these arguments, and instead relied on the absence of corroborating documentary evidence in the Centrelink records to reject the Applicant’s oral evidence. The Applicant further submitted that the Tribunal, in considering the (on the Applicant’s case) unchallenged evidence of the Applicant’s witnesses, such as Mrs Mandoulidis, had failed to engage with the Applicant’s submission that unchallenged evidence which is not inherently incredible ought to be accepted. The Applicant concluded that the Tribunal failed to afford her natural justice.
The Respondent submitted that the Tribunal did address the Applicant’s submissions regarding the reliability of Centrelink’s records and that, in any event, expressly referring to every submission in its reasons is neither necessary for the Tribunal to comply with its obligations under s 43(2) of the AAT Act, nor does the failure to do so necessarily amount to legal error. The Respondent also rejected the Applicant’s contention that the Tribunal relied only on the absence of corroborating Centrelink records to reject her oral evidence, noting that that conclusion was also based on the Applicant’s own failure to produce the records of her interactions with Centrelink that she stated she made and kept, and the adverse credibility findings made against her. Finally, the Respondent refuted both that Mrs Mandoulidis’ evidence was unchallenged and that it was “not inherently incredible” in light of the inconsistencies between her 16 March 2004 letter (which I consider below) and the evidence of Mr Pepper.
In her reply submissions, the Applicant reiterated that the transcript reveals no challenge to Mrs Mandoulidis’ evidence by either the Respondent or the Tribunal, and that no finding was made by the Tribunal that Mrs Mandoulidis’ evidence was inherently incredible. In oral submissions, the Applicant relied upon Sullivan at [119], where Flick and Perry JJ stated:
Although the Tribunal is not obliged to accept evidence which is not contradicted by means of cross-examination or otherwise, it has long been recognised that the rejection of such evidence may amount to a denial of procedural fairness: cf Hoskins v Repatriation Commission (1991) 32 FCR 443 at 449-450 per Pincus J. Equally a failure to provide adequate or any reasons for rejecting unchallenged evidence may constitute an error of law: Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 587-588 per Samuels JA.
The Respondent argued in oral submissions that the Applicant’s submissions on this point were misconceived because Mrs Mandoulidis’ evidence was not relevant to the central issue — viz, whether she had acted jointly with Mr Mandoulidis and the Applicant to remove or replace the Applicant as Trustee and beneficiary in writing.
Consideration
As articulated in the Applicant’s written submissions, the complaint advanced is that the Tribunal failed to accord the Applicant natural justice by failing to respond to, and appearing to ignore, certain submissions that she made.
It is not incumbent on the Tribunal to expressly refer to each and every submission that is made: Applicant WAEEv Minister for Immigration and Multicultural and Indigenous Affairs (2003) 236 FCR 593; [2003] FCAFC 184 at [46] (French, Sackville and Hely JJ), cited in KXXH v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2022) 292 FCR 15; [2022] FCAFC 111 at [52] (Bromberg, Jackson and Feutrill JJ).
In any event, the Tribunal’s reasons reveal that it closely analysed the Centrelink records before it and identified gaps and inconsistencies in those records. The Tribunal expressly referred (at T [48]) to the documents presented “prior to, at and after the hearing” in the context of observing that many documents were “disjointed or incomplete”, that there were multiple versions of similar (but not identical) documents, and that the “gaps and/or inconsistencies” in the “documents filed by both parties” made the process of determining the facts difficult and time-consuming (emphasis added). Those “gaps and/or inconsistencies” were then the subject of extensive analysis by the Tribunal. In light of those observations of the Tribunal, and its close analysis of the documentary record, the Applicant’s contention that the Tribunal treated the Centrelink records as a “fulsome record” cannot be sustained.
While the Tribunal did not expressly advert in terms to the Applicant’s Jones v Dunkel submission, that does not reveal an error of law by the Tribunal. The Applicant did not identify specific inferences that she contended the Tribunal could more comfortably draw on the basis that the Respondent had failed to call witnesses. Her submission to the Tribunal, reiterated in her oral submissions to this Court, was that “the Tribunal should draw the inference that the witness’s [sic] evidence would not have assisted the respondent’s case”. To the extent that the Applicant’s submissions before the Tribunal drew attention to the respective capacities of the parties and their ability to adduce evidence, that was a matter that the Tribunal clearly adverted to at T [49]–[50].
I also accept the Respondent’s submission that the Tribunal did not rely solely on the absence of corroborating Centrelink records in rejecting the Applicant’s oral evidence. As a fulsome reading of the Tribunal’s decision shows, it also had regard to the Applicant’s failure to provide the notes she herself said she had kept of her interactions with Centrelink, and adverse credibility findings made by the Tribunal against the Applicant.
The Applicant suggested that the Tribunal failed to engage with her submission that evidence that is not inherently incredible and which is unchallenged ought to be accepted. The Applicant puts the evidence of her mother, Mrs Mandoulidis, in that category. The Tribunal referred to Mrs Mandoulidis’ evidence at T [80]–[81]. Insofar as that evidence comprised a letter, the Tribunal addressed it at T [96(d)]. Her oral evidence did not go much beyond confirming the contents of her letter, but she was cross-examined on some aspects. Mrs Mandoulidis’ letter referred to a solicitor being consulted about amending the Trust Deed. However, as the Respondent noted in its submissions, the evidence of Mrs Mandoulidis was inconsistent with the evidence of a solicitor, Mr Pepper, as to how the Deed of Retirement came to be prepared (T [62]–[67] and [81]). Whereas three versions of the “Deed of Retirement of Trustee and Appointor & Amendment The Mandoulidis Family Trust, Trust Deed” were before the Tribunal in the form prepared by Mr Pepper (identified by the Respondent as those at T [61(d)–(f)]), two appeared to have been backdated to 1999 (T [61(d)–(e)] and [96(g)]) in circumstances where Mr Pepper’s evidence was that the template Deed of Retirement was only prepared after certain legislative amendments were passed in 2000 (T [66]–[67]). To the extent that Mrs Mandoulidis’ letter is to be read as referring to a solicitor other than Mr Pepper, the evidence before the Tribunal, which it listed at T [61], was not limited to the documents in the form prepared by Mr Pepper. The Tribunal explained (particularly at T [96(c)]) the deficiencies in those documents.
The Applicant has not demonstrated any lack of procedural fairness in the Tribunal’s approach or engagement with her arguments.
GROUND 5
Ground 5 states:
The AAT acted unreasonably or irrationally, made findings of fact without sufficient evidential basis, and or ignored relevant evidence in making findings, including in relation to findings that:
a.There was no evidence that the Applicant informed Centrelink about details [of] relevant transactions (e.g. at [193]),
b.The Applicant did not show a desire to be discharged from the Trust ([103]),
c.There were no documents that were before the Tribunal that showed the Applicant had been removed in accordance with the requirements of the Trust Deed ([96]), and
d.The applicant’s oral evidence that she retired from the Trust on 9 May 1999 was rejected (at [96]).
The Tribunal’s findings
This ground impugns several findings of the Tribunal considered in detail above. I summarise (and where necessary, expand on) this analysis below.
No evidence Centrelink informed about property transactions
In determining that the Applicant’s parenting payment single and disability support pension debts should not be waived, the Tribunal found that there was no documentary evidence demonstrating that the Applicant informed Centrelink about the purchase, building and sale of various properties at the relevant time (T [193]). In so concluding, the Tribunal — having earlier determined that it would place minimal weight on the Applicant’s oral evidence where it was inconsistent with contemporaneous documentary evidence or credible witnesses — highlighted that the Applicant had not adduced any of the records she allegedly kept of her interactions with Centrelink (T [191]).
Applicant did not evidence a desire to be discharged from the Trust
The Tribunal concluded that the Applicant had not retired from the Trust pursuant to s 41 of the Trustee Act because her actions since 1999 did not evidence a desire to be discharged from the Trust or the powers reposed in or conferred on her as Trustee (T [103]). The Tribunal accepted that there was extensive documentation showing Mr Mandoulidis’ involvement in the administration of the Trust and referring to Mr Mandoulidis as Trustee (T [98(d)]). However, countervailing factors included references in Trust financial statements to the Applicant having received beneficiary distributions and a share of profits, and amounts being recorded in the Applicant’s name in respect of “current liabilities”, in various years between 1999 and 2021, and the Applicant’s use of Trust assets as security for financial loans (T [98(b)] and [98(e)]).
No documents showing Applicant’s removal from the Trust in accordance with the Trust Deed; rejection of the Applicant’s oral evidence
In concluding that there were no documents effecting the Applicant’s removal from the Trust pursuant to the requirements of the Trust Deed, the Tribunal rejected the Applicant’s oral evidence having regard to the evidence of Mr Pepper — in particular, that he did not prepare the Deed of Retirement document until after the year 2000 (T [96(e)]). Of particular relevance to the Tribunal’s finding was the absence of Mrs Mandoulidis’ signature on core documents relied upon by the Applicant, including documents listing 9 February 2003 as the Applicant’s purported retirement date (T [96(c)]). The Tribunal also rejected the Applicant’s submission that Mrs Mandoulidis and her son Mr Mandoulidis’ letters dated 16 March 2004 resolved any “technical issues” in respect of the Applicant’s retirement and showed that, at least from 2004, the Applicant was no longer a Trustee or beneficiary (T [96(d)]).
The letter signed by Mrs Mandoulidis said that, after her husband’s death in 1999, “we” met with “our solicitor” and “amended the trust to read, that my son was now in full control”. Mr Mandoulidis’ letter was in similar terms, but said “we asked our solicitor to amend the Trust to my full control”. The Tribunal concluded that neither letter had “any legal effect regarding Ms Di Paolo’s resignation (or not) in relation to the Trust”.
The parties’ principal submissions
Rejection of evidence of Mrs Mandoulidis and Mr Mandoulidis
The Applicant submitted that the Tribunal’s finding that the letters signed by Mrs Mandoulidis and her son, Mr Mandoulidis, dated 16 March 2004 were of “no legal effect” was unreasonable and irrational. The Applicant contended that the documents were admissible and relevant to whether the Appointor had acted jointly and in writing to remove the Applicant as a Trustee, Appointor and/or beneficiary of the Trust. The Applicant argued that Mrs Mandoulidis’ oral evidence adopting the contents of her letter was not challenged by the Tribunal or Respondent, yet the Tribunal unreasonably gave no weight to this evidence in assessing these issues. In her reply submissions, the Applicant also noted that the Respondent had not sought to call Mr Mandoulidis to address any concerns with his written evidence. The Applicant submitted that the rejection of this evidence amounted to a denial of procedural fairness and the failure to provide adequate reasons for doing so constituted an error of law: citing Sullivan at [119] (Flick and Perry JJ).
The Respondent characterised the Applicant’s arguments as an impermissible attempt to review the facts found by the Tribunal. The Respondent argued that nothing in the letters referred to any decision relating to the Trust being recorded in writing. As outlined above, the Respondent rejected that Mrs Mandoulidis’ evidence was unchallenged, and argued further that the assertions in the letters were inconsistent with other facts found by the Tribunal: for example, the statements that a family meeting to discuss the Trust took place in 1998 were inconsistent with the Trust having been established the following year, in April 1999. The Respondent concluded that the Tribunal did not err in finding that the letters had no legal effect.
In her reply submissions, the Applicant argued that the letters merely evidenced that a family meeting had been held in 1998, not that the Trust was established at this meeting. As outlined above, the Applicant also suggested that the solicitor referred to in Mrs Mandoulidis’ letter (with whom the family allegedly met to amend the Trust in 1999) was not Mr Pepper, but some “other [lawyer] or other [party] involved in assisting with resignation”. The Applicant argued that her oral evidence regarding who drafted the resignation documents must be read fully and fairly, including her concession that she did not recall, noting that the events in question occurred approximately 25 years ago.
The Applicant’s submissions come nowhere near meeting that hurdle. The Tribunal considered the Applicant’s oral evidence and weighed it against the documentary record at T [72]–[77] (see also T [96] and [98]). The assessment of the evidence is a matter for the Tribunal and I see no error of law in the basis upon which the Tribunal rejected the Applicant’s oral evidence at T [96(e)–(f)].
Desire to be discharged from the Trust
This aspect of ground 5 fixes on T [103], where the Tribunal said:
I have considered sections 41 and 44 of the Trustees Act, submissions from counsel of the Applicant and Respondent and supporting documents. For the reasons I have set out in paragraphs 96 and 98 above, I am not satisfied that Ms Di Paolo has effected her retirement from the Trust because I find that her actions since 1999 do not show she has desired ‘to be discharged from’ the Trust or the ‘powers reposed in or conferred on’ her as Trustee of the Trust.
The Applicant’s contention is that the finding was “unreasonable or irrational” in light of the documents she referred to in relation to other aspects of ground 5. The Applicant’s complaint does not establish any error of law. While the Applicant’s submissions refer to a number of documents and other pieces of evidence, she has not established that they were such as to render the Tribunal’s articulated decision on the point in question one that lacks an evident and intelligible justification.
The Applicant submitted that error is revealed on the basis that the Tribunal “did not appear to consider” specific documents. That is not correct as the documents in question were referred to at T [61(f)–(g)], which analysis the Tribunal picked up by a cross-reference in T [103] to the reasons set out at T [96] and [98]. Further, and as the Respondent observed, the Tribunal’s findings concerning the Applicant’s standing vis-à-vis the Trust include its findings of fact (T [77] and [98]) regarding financial benefits that the Applicant received from the Trust.
Accordingly, in my view, the Tribunal’s analysis of the evidence and findings of fact provide an intelligible and apparent basis for its finding at T [103].
No documents that showed the Applicant had been removed
The Applicant’s contention was that the Tribunal acted “unreasonably or irrationally and or erroneously placed insufficient weight” on the documents she referred to in relation to other aspects of ground 5 when it concluded at T [96(b)] that there were no documents before it showing that the Applicant had been removed as a Trustee, Appointor or beneficiary in accordance with the requirements of the Trust Deed. She also relied on a contention that other “relevant parties”, apart from Centrelink, treated her as having been removed as Trustee, Appointor or beneficiary.
Again, the Applicant’s complaint is essentially one concerning the Tribunal’s findings of fact and its weighing of the evidence. As with other aspects of this ground, the finding of the Tribunal that is impugned is a finding made after the Tribunal had earlier comprehensively surveyed the documentary record. The finding has a readily apparent and intelligible justification. There was no error of law.
No evidence of notifications
The Applicant submitted that the Tribunal’s finding at T [193] that it was satisfied there was no evidence before it that the Applicant had informed Centrelink about various property transactions disregarded, “without justification”, or “unreasonably placed no weight on” her oral evidence.
The Tribunal’s reasons at T [193] refer to its earlier recitation of what was, and was not, contained in the Centrelink records. That provided an intelligible basis for the finding of the Tribunal regarding what the Applicant had, or had not, informed Centrelink about. The Tribunal was entitled not to accept the Applicant’s oral evidence. Further, and as the Respondent observed, the Applicant claimed to have made her own records of her conversations with Centrelink officers, but she had not produced those records to the Tribunal (see T [191]). The impugned finding at T [193] was clearly made in that context.
GROUND 6
Ground 6 states:
The AAT failed to comply with section 39 of the Administrative Appeals Tribunal Act 1975 (Cth) and or afford the Applicant procedural fairness by virtue of: Not providing the applicant an opportunity to respond to adverse inferences or findings drawn from documents obtained by the Tribunal following the completion of the hearing (e.g. at [77], [86], [104]-[141]).
In oral submissions, the Applicant abandoned reliance on T [104]–[141] and sought to instead rely on T [96]–[98] (in addition to T [77] and [86]).
The Tribunal’s findings
As outlined at paragraph 16 above, the FOI release documents were filed with the Tribunal after the conclusion of the hearing. The hearing was not reconvened.
The Tribunal relied on the FOI release documents, including documents that were inconsistent with the Applicant’s oral evidence that she resigned from the Trust on 9 May 1999 and ceased any further activity or interest in respect of the Trust, along with a great deal of other evidence, in concluding that 50% of the Trust assets should be attributed to the Applicant (see T [77], [86] and [96]–[98]).
The parties’ principal submissions
The Applicant submitted that the Tribunal’s failure to reconvene the hearing after receiving the FOI release documents, or to afford either party a reasonable opportunity to make submissions in respect of them, amounted to a contravention of s 39(1) of the AAT Act and the common law rules of procedural fairness.
The Respondent submitted that the FOI release documents were included in the evidence before the Tribunal following a request made by the Applicant during a 31 October 2023 directions hearing, convened at her request. The Respondent annexed a transcript of the directions hearing to his written submissions in this Court. The transcript records counsel for the Respondent indicating that the Applicant should be given an opportunity to address any matters raised in the FOI release documents if she wished to do so, to which the Applicant’s counsel responded that he would confirm with the Applicant if she wished to give further evidence. The Respondent noted that the Applicant did not seek to make further submissions, nor apply to re-open her evidence. By his written submissions, the Respondent concluded: “[i]n those circumstances, the Applicant has not been denied a reasonable opportunity to make any submissions she wished about the material in the documents which she asked the Tribunal to consider and take into account” (emphasis in original).
The Applicant submitted in reply that a fair reading of the transcript reveals that the Tribunal was reluctant for any further material to be received, and agreed with the Respondent’s counsel that it was not appropriate to allow the Applicant to give any further evidence in response to the additional materials. The Applicant cited Kamal v Minister for Immigration, Citizenship and Multicultural Affairs (2023) 300 FCR 106; [2023] FCAFC 159 (Kamal) at [18], where the Full Court approved the following statement by the primary judge:
What is, and is not, a “reasonable opportunity” will of course be highly fact-dependent. It can be accepted that the Tribunal’s discharge of its obligation may well require it in certain circumstances to be proactive, to be flexible and to actively consider the circumstances of a review applicant. All such matters inhere in the concept of what is a “reasonable” opportunity in a specific situation. None require a gloss on the s 39(1) obligation itself.
(emphasis added.)
(The Applicant erroneously cited the first instance judgment, but it appears from her submissions that the Applicant intended to rely on the Full Court decision.)
In oral submissions the Applicant maintained that, while the Tribunal did not preclude the Applicant from giving further evidence in respect of the FOI release documents, it is clear from the directions hearing transcript that it had determined it was not appropriate for her to do so. She submitted further that “in the circumstances where these documents should have been provided by the respondents at first instance [but] were not … it would have been appropriate and required by procedural fairness to invite further submissions to be made” (emphasis added).
The Applicant also clarified in oral submissions that the adverse inferences said to have been drawn from the FOI release documents included that the documents were inconsistent with her oral evidence regarding her purported retirement from the Trust (T [77]), that the Applicant continued to benefit from the Trust as at 2001 (T [86]) and that the Applicant had not relinquished all beneficial interest in or genuinely resigned from the Trust (T [96(f)(i)] and [98(a)]).
Consideration
The matter was heard by the Tribunal between 19 and 22 June 2023. The Applicant’s reply closing submissions were received by the Tribunal on 2 October 2023. The transcript of the directions hearing on 31 October 2023 records the Tribunal noting that an email had been received from the Applicant’s counsel, which stated that the Applicant had lodged an FOI request in 2021 but had only received the documents the previous week (after the written closing submissions had been provided to the Tribunal). The Tribunal invited the parties to address how they contended the matter of the further documents should be dealt with. Counsel for the Applicant outlined two possible approaches, and the pros and cons of each. By the time of the directions hearing, counsel for the Applicant had had at least a “quick look” at the additional documents that his client had received in the FOI release. Counsel for the Applicant proceeded to identify the nature and significance of some of the documents received. In answer to a question from the Tribunal, counsel for the Applicant confirmed that at least a couple of hundred pages of the additional documents appeared to be relevant and probative.
The Tribunal then asked counsel for the Respondent why the documents had not been made available previously, to which the answer (so far as enquiries had revealed at that stage) was that because they were in hard copy, and not on the electronic file, they had been overlooked. The Tribunal required the Respondent to put in writing its explanation for why the documents only came to light late.
Counsel for the Respondent indicated that about 200 pages from the bundle of newly produced documents had been identified as missing from the “T documents”. Having adverted to considerations of procedural fairness, the Tribunal ensured that the Applicant had an opportunity to review the bundle that was being collated by the Respondent.
The Tribunal noted that it appeared, from the observations made during the directions hearing, that neither side saw a need to put on further submissions, but explicitly asked each side about that. Counsel for the Respondent observed that the new documents were “largely consistent with our submissions to date” but that the Respondent would not object to the Applicant being given an opportunity to explain things in the documents.
The Tribunal invited counsel for the Applicant to respond. He said:
I think our submissions, or any further submissions were they to be made, would be in line with the submissions that we’ve already made. It would probably be an alternative interpretation, I’m guessing, to what the respondent would have made, consistent with that respective position, and that it would have been a further altering of our position or – in line with those further documents and the existence of those further documents. And I’m sure you, Member, can read between the lines on a lot of that, and therefore a (indistinct) won’t be necessary.
I understand what my friend is saying in terms of allowing that further opportunity. Perhaps once we’ve got those final pages, we’ll ensure that Ms Di Paolo has had an opportunity. She’s got hard copies of those pages – sorry, the full bundle. Perhaps once I’ve got the pages, I can confirm with her whether she feels like she needs to explain anything further from those pages, or whether she would just like to proceed. I know that her desire (indistinct words) as soon as possible, and that’s not wasted on anyone here.
But perhaps if we can go about it that way, by saying that we don’t intend to make any further submissions or seek for the tribunal to be reconstituted to have Ms Di Paolo give evidence, but I will confirm with Ms Di Paolo once I’ve got that pages [sic], if that makes sense.
Although the Tribunal indicated it had already spent a great deal of time reviewing the Applicant’s existing evidence, and had been taken to all of the critical timeframes, it did so in the context of also acknowledging that “clearly it’s a matter for [the Applicant]”. The Applicant’s counsel then confirmed again that he did not anticipate that the Applicant would want to give more evidence, and would confirm his instructions.
I have set out what occurred during the directions hearing as it reveals two critical matters: first, it was the Applicant that wanted the Tribunal to receive and consider the additional documents; and secondly, that the Applicant was given the opportunity to put on further submissions or give further evidence, if she wished. She was represented by counsel at that time, and counsel participated in the directions hearing, having already read the documents to a sufficient extent to offer commentary on them to the Tribunal.
There was no lack of procedural fairness. In circumstances where the Applicant was afforded the opportunity to be heard on the further documents (by evidence and/or submissions), it was not incumbent on the Tribunal to notify the Applicant regarding each and every view it may have formed in preparing its reasons that had regard to those documents, and invite the Applicant to respond. As stated in Commissioner for ACT Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591–2 (the Court):
Where the exercise of a statutory power attracts the requirement for procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker in support of an outcome that supports his or her interests. That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision-maker. It also extends to require the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made. The decision-maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material. Subject to these qualifications however, a decision-maker is not obliged to expose his or her mental processes or provisional views to comment before making the decision in question.
(emphasis added.)
Similarly, in Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57, Gaudron and Gummow JJ observed (at [76]) that: “[t]here is no universal proposition that before the Tribunal ever makes a finding adverse to an applicant, it is necessary for the Tribunal to put to the applicant the concerns which are inclining the Tribunal towards such an adverse finding.”
Section 39(1) of the AAT Act required the Tribunal to ensure that every party to a proceeding before it was “given a reasonable opportunity to present his or her case” and to “inspect any documents to which the Tribunal proposes to have regard in reaching a decision in the proceeding and to make submissions in relation to those documents”. The suggestion that the way the Tribunal dealt with the FOI release documents fell short of that standard is entirely devoid of merit. The observations of Mortimer J (as her Honour then was) in Kamal v Minister for Immigration, Citizenship and Multicultural Affairs [2023] FCA 200 at [107], which are relied on by the Applicant and were approved by the Full Court in Kamal at [18], confirm that what is or is not a “reasonable opportunity” is highly fact-dependent. Those observations do not suggest that it was incumbent on the Tribunal to second-guess the Applicant’s own counsel, who was to advise the Applicant and take instructions on whether she wished to say anything further, by way of evidence or submissions on the documents.
RESPONDENT’S EXTENSION OF TIME APPLICATION
On 15 October 2024, pursuant to r 33.13 of the Federal Court Rules 2011 (Cth), the Respondent filed an application for an extension of time within which to institute a cross-appeal from the Tribunal’s decision.
The Respondent’s application was supported by a proposed Notice of Cross-Appeal dated 14 October 2024 and an affidavit of Peta Heffernan, Senior Lawyer at the Australian Government Solicitor, affirmed 14 October 2024.
The proposed Notice of Cross-Appeal was in the following terms:
Questions of law
1.Whether the Applicant’s debts for overpayment of family tax benefit were based on an assessment of the Applicant’s entitlement to family tax benefit made in accordance with Schedule 1 to A New Tax System (Family Assistance) Act 1999.
Orders sought
1.Paragraph (a) of the Tribunal’s decision be varied so that the reassessment of the Applicant’s entitlement to family tax benefit for the financial years referred to in subparagraphs (i) to (vii) be remitted to the Respondent to be recalculated on the basis that the Applicant was a member of a couple for the period between 1 May 2013 to at least 16 September 2021.
Grounds relied on
1.The Tribunal’s finding that the Applicant had debts for overpayment of family tax benefit in the amounts set out in paragraph (a) of the decision may not reflect the Applicant’s entitlement to family tax benefit in accordance with Schedule 1 to A New Tax System (Family Assistance) Act 1999.
As may be seen, the proposed cross-appeal concerned the accuracy of the amounts of family tax benefit debts set out in paragraph (a) of the Tribunal’s decision for the financial years ending 2014 to 2021 (excluding the 2019–20 financial year).
In her affidavit, Ms Heffernan noted that the family tax benefit debt amounts referred to above were the amounts originally raised by the Respondent against the Applicant in 2021, based on information held by Centrelink at that time regarding the Applicant’s and Mr Di Paolo’s income in the relevant financial years.
Ms Heffernan explained that, in January 2024, in the course of implementing the Tribunal’s decision, the Respondent recalculated the Applicant’s family tax benefit debts, which recalculations “were not the amounts found by the Tribunal”. Ms Heffernan said she was informed of this discrepancy on 26 August 2024 and was instructed that Services Australia was still clarifying the basis on which those debts had been recalculated. Ms Heffernan deposed that since this date she had been seeking instructions to clarify the basis on which the debts were recalculated, including the reason for the discrepancy between the recalculated amounts and the amounts found by the Tribunal.
On 11 October 2024, the Respondent wrote to the Applicant advising of this discrepancy, explaining that Services Australia was still investigating the matter (including whether the discrepancy was “due to errors in the implementation or whether new information was received”) and that, if the Court dismissed the Applicant’s appeal, the Respondent would seek orders varying the Tribunal’s decision in the manner outlined in the proposed Notice of Cross-Appeal.
In oral submissions, the Respondent advised that he believed the preliminary recalculation resulted in an overall reduction in the Applicant’s family tax benefit debts, but that the final debts “might be less, they might be more” than the present figures depending on the outcome of this appeal and whether the Applicant is required to file amended tax returns. The Respondent contended that the late application did not prejudice the Applicant because the Tribunal’s decision had not yet been implemented and, if her appeal were unsuccessful, may require her to pay greater family tax benefit debts than she in fact owes. The Respondent also raised the possibility that I defer consideration of the application until the conclusion of the present appeal.
In oral submissions, the Applicant opposed both the application and the Respondent’s suggestion that it be deferred until the present appeal had concluded. When asked whether she opposed the application notwithstanding that her overall family tax benefit debt may be reduced if remitted to the Respondent, the Applicant reiterated that the Respondent’s comments were “just comments from the bar table at this stage” and that there was no factual basis for the application.
Consideration
As I informed the parties during the hearing, I refused the Respondent’s application for an extension of time.
In Parr v Commissioner of Taxation [2022] FCA 67, Banks-Smith J summarised the principles applicable to the exercise of discretion to grant an extension of time as follows (at [40]):
The principles relating to the exercise of discretion to extend time are well settled. The relevant factors were collected by Wilcox J in Hunter Valley Development Pty Ltd v Cohen, Minister for Home Affairs and Environment (1984) 3 FCR 344 at 348-349 and have been cited on numerous occasions. Matters to be weighed include: the statutory prescribed period and whether the Court is positively satisfied that it is proper to extend that period; the length of the delay; any explanation for the delay; any action the applicant has taken apart from the proceedings and whether the contest of the finality of the decision has remained in issue; prejudice to the respective parties if an extension is or is not granted, including any prejudice in defending the proceedings occasioned by the delay; the nature of the decision and, in that context, relevant public interest considerations including the need for finality in litigation; and the merits of the substantive application. These considerations are not exhaustive. Hunter Valley concerned those principles in the context of an application for an extension of time under the Administrative Decisions (Judicial Review) Act 1977 (Cth). However, they have been applied to applications under s 44 of the AAT Act: Peczalski v Comcare [1999] FCA 366 at [19]; and Franich v Secretary, Department of Families, Housing Community Services and Indigenous Affairs [2011] FCA 1362 at [20].
(emphasis added.)
A number of these factors are relevant to the Respondent’s application.
First, there has been exceptional delay in the filing of this application. The Respondent did not advise the Applicant of his intention to pursue a cross-appeal until 11 October 2024, and did not file an application for an extension of time until 15 October 2024 — the day before the hearing in this Court.
Secondly, the Respondent has not provided a sufficient explanation for the delay. In particular, the Respondent has offered no explanation for the seven-month delay between the “recalculation” of the Applicant’s family tax benefit debts in January 2024 and bringing the discrepancy to the attention of his solicitor, or the further two-month delay in advising the Applicant of the issue and filing the application for an extension of time. No satisfactory explanation for the delay has been provided, in Ms Heffernan’s affidavit or otherwise.
Thirdly, it is neither appropriate nor consistent with the expeditious disposition of the business of this Court to defer determination of this application pending the outcome of the present appeal, as the Respondent invited the Court to do.
Fourthly, the merits of the proposed cross-appeal are unclear. The Respondent’s letter to the Applicant, annexed to Ms Heffernan’s affidavit, noted that the Respondent did not know why there was a discrepancy and whether the discrepancy was caused by “errors in implementation” or “new information”. As outlined above, the Respondent’s oral submissions also made clear that there is no certainty as to whether the Applicant’s overall family tax benefit debt would be higher or lower than the present figures. Further, no indication was provided as to the quantum of the potential discrepancy. Although it was possible, at least in theory, that the “correct” figures might be lower (and thus beneficial to the Applicant if her appeal were to fail), the Applicant was opposed to the extension of time being granted, and also opposed the suggestion that the application be deferred and only considered if the appeal failed.
For these reasons, the application for an extension of time within which to file a notice of cross-appeal in this proceeding was refused.
I certify that the preceding one hundred and ninety (190) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Button. Associate:
Dated: 14 November 2024
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