Divjak and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
[2008] AATA 945
•23 October 2008
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2008] AATA 945
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2007/5875
GENERAL ADMINISTRATIVE DIVISION ) Re STEVO DIVJAK Applicant
And
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS
Respondents
DECISION
Tribunal Rear Admiral A R Horton AO, Member Date23 October 2008
PlaceSydney
Decision The decision under review is varied in that the Commonwealth’s right to recover the debt of $8503.05 is waived under section 1237AAD of the Social Security Act 1991 to the extent that 50% only of the debt is recoverable. The matter is accordingly remitted to Centrelink.
...................[sgd].....................
Rear Admiral A R Horton AO
Member
SOCIAL SECURITY - Assurance of Support vide section 1061ZZGA of the Social Security Act 1991 – Applicant (assurer) gave an Assurance of Support in 2002 – further Assurance of Support approved in 2005 for a different visa applicant – assuree married to Applicant’s friend – marriage failed – domestic violence issues – assuree variously granted Special Benefit, Newstart Allowance and Austudy – debt for social security payments raised against assurer – 50% of debt waived under section 1237AAD of Act on appeal to the Social Security Appeals Tribunal – Assurer sought waiver of remaining debt – 50% of remaining debt waived
Social Security Act 1991 – Sections 578, 578B, 596A, 729, 1061ZZGA, 1061ZZGEA, 1061ZZGG, 1227, 1236, 1237AAD, 1237AAE
Beadle v Director-General of Social Security (1985) 7 ALD 670
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Secretary, Department of Social Security v Hales (1998) 82 FCR 154
Dranichnikov v Centrelink (2003) 75 ALD 134
Ryde v Secretary, Department of Family and Community Services [2005] FCA 866
Angelokas v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9
Re Phan and Secretary, Department of Employment and Workplace Relations [2006] AATA 76
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Secretary, Department of Family and Community Services and El Hawli (also known as Hassan) (AAT 13491, 27 November 1998)
Re Haykal and Secretary, Department of Social Security (AAT 10895, 29 April 1996)
Re Lamvohee and Secretary, Department of Social Security (AAT 12166, 28 August 1997)
REASONS FOR DECISION
23 October 2008 Rear Admiral A R Horton AO BACKGROUND
1. On 15 June 2005, Mr Stevo Divjak (“the Applicant” – and “the Assurer”) lodged an application – which was approved the same day - to provide an Assurance of Support (“AOS”), to enable Mrs Snjezana Pribicevic (“the Assuree”), the wife of a friend, Mr Nedeljko Pribicevic, to obtain a visa enabling her to join her husband in Australia. Under the various provisions of the Social Security Act 1991 (“the Act”) Mr Divjak became responsible for the provision of support to Mrs Pribicevic for two years from her date of entry into Australia, and for debts in respect of social security payments she might receive.
2. Mrs Pribicevic arrived in Australia on 14 August 2005. On 29 December 2005, Mrs Pribicevic lodged a claim for Special Benefit, advising that she had separated from her husband on 25 November 2005 because of domestic violence and was living in a refuge. Special Benefit was granted that day; on the advice of the social worker, and in accordance with the guidance in the departmental Guide to Social Security Law, because of the circumstances of domestic violence attributed to Mr Pribicevic, Mr Divjak was not advised of the situation, nor asked whether he was “willing and able to provide …. support” to Mrs Pribicevic vide sections 729 and 578B of the Act.
3. In the course of the next 18 months, Mrs Pribicevic sought, and was granted, a period of Newstart Allowance (“NSA”) and a subsequent period of Austudy. For the same reasons, Mr Divjak was not advised of these claims and hence not asked whether he was willing and able to provide support.
4. On 16 July 2007, a Centrelink Authorised Review Officer (“ARO”) affirmed an AOS debt in respect of the above benefits of $15,514.24 as at 14 June 2007. On 19 October 2007, the Social Security Appeals Tribunal (“SSAT”) waived the right of the Commonwealth to recover 50% of that debt, and 50% of any further debt accrued until 13 August 2007, when the AOS lapsed.
5. At a hearing before me on 10 September 2008, Mr Divjak was represented by Mr Steven Stojanovic of Stojanovic Solicitors. Mr George Lozynsky represented the Respondent. The Tribunal was assisted by Mr Bratislav Stankovic, an interpreter fluent in the Serbian language. Mr Divjak gave evidence.
6. Three bundles of Section 37 documents had been provided to the Tribunal by the Respondent pursuant to section 37 of the Administrative Appeals Tribunal Act1975, with the request that bundles Number 2 (B2) and 3 (B3) not be provided to the Applicant or his solicitor as they referred to sensitive issues in respect of the domestic violence situation as it affected the Assuree. As requested, Deputy President Walker directed that Bundles Number 2 and 3 be provided only to the Tribunal and Tribunal staff.
7. Resulting from Directions Hearings on 4 March 2008 and 16 May 2008, bundle B3 (with the exception of page T80), which generally referred to social worker contacts with the Assuree, was made available to the Applicant. Bundle B1 and bundle B3 were taken into evidence. B2 remains available only to the Tribunal and Tribunal staff and was taken into evidence as Confidential Exhibit C1 on that basis. Unless otherwise stated, references to pages hereunder (by a T number or page number) will be in respect of bundle B1. Statements of Facts and Contentions of both parties were also taken into evidence (Exhibits A1 and R1), as were a number of other documents.
ISSUES
8.. Mr Divjak has sought review of the decision of the SSAT as to whether he is liable for the Special Benefit, Newstart Allowance and Austudy payments paid to Mrs Pribicevic, and if so, whether the recovery of the remainder of the debt (post the SSAT decision) can be written off or waived.
9. The Secretary, Department of Education, Employment and Workplace Relations and the Secretary, Department of Families, Housing, Community Services and Indigenous Affairs (“the Respondents”) accept the decision of the SSAT, agree to the issues identified above, and submit that the Applicant’s circumstances are not sufficiently unusual to warrant further waiver of the debt under the special circumstances provisions of section 1237AAD of the Act.
DECISION
10. For reasons given hereafter, the Tribunal varies the decision of the Social Security Appeals Tribunal to the extent that the Commonwealth’s right to recover 50% of the debt remaining after the SSAT’s decision (being calculated as $8503.05) is waived under the provisions of section 1237AAD of the Act.
EVIDENCE
11. Both parties agree that the total debt in this matter, consisting of 50% of $15,514.24 plus 50% of any further debt accrued to 13 August 2007, when the AOS expired, is $8503.05. On 6 February 2008, the Commonwealth received $5900.05 in respect of that debt by way of garnishment, leaving a residual amount due of $2603.00.
12. In 2002, Mr Divjak signed a Department of Immigration and Multicultural Affairs form 28A (T10) giving “discretionary assurance of support” for Mrs Snezana Poluga, the wife of a friend of his, in order to facilitate her entry into Australia. The Respondents gave the opinion that the form predated the current practice whereby the application to provide AOS is now made to Centrelink, that authority in turn informing the immigration authorities of approval. The form shows Mr Divjak’s place of residence as 4 Saunders Crescent, Liverpool.
13. The evidence of Mr Divjak as to how and where this form was completed was unclear; he acknowledged it contained his signature but the rest was not in his handwriting. His application shows that the declaration was made at Liverpool on 1 February 2002 before a Justice of the Peace; Mr Divjak believed that a friend of his, Mr Poluga, brought the completed form to his home. He stated that he did not read the form, and no interpreter was present; when asked whether he knew his obligations, he stated “no”, but that he had some idea. He stated that he was not interviewed by any government employee. He could not recall whether he had signed the form before a Justice of the Peace. I note that his application was approved in Belgrade on 13 February 2002.
14. The significance of this application, from the Respondents’ point of view, is that prior to lodging his later “Application to provide an Assurance of Support” for Mrs Snjezana Pribicevic (nee Starcevic) on 15 June 2005 (T15), Mr Divjak should have been aware of the responsibilities associated with such an application. The evidence of Mr Divjak is that at no time in the ensuing two years, after the arrival of Mrs Poluga in Australia, was he required to support her financially or otherwise, and there is no evidence to the contrary. Initially in his evidence Mr Divjak suggested that his wife had arrived in Australia under similar AOS arrangements, but when further questioned, he was not sure that was the case. In cross examination, the Respondents suggested that the fact that Mr Divjak had to provide financial details regarding income and employment was evidence that he would have a financial responsibility under an AOS. Mr Divjak saw that such a requirement was standard and had no particular significance in the context of the AOS.
15. In this later application, Mr Divjak gives his address as 7/11 Hart Street Warwick Farm, a property that he and his wife own and live in. Mr Divjak was asked by Mr Pribicevic, who is a disability pensioner, to sponsor the latter’s wife for immigration to Australia, and he agreed to do so, hence the application for AOS. The evidence of Mr Divjak is that whilst he signed the application form, it had been completed by Mr Pribicevic. Mr Pribicevic accompanied Mr Divjak to Centrelink at Haymarket, where the application was lodged. In spite of his earlier request for a Serbian interpreter – which Mr Divjak believed he made through the interpreter service - this did not occur; the Respondents accept that this was the case.
16. When asked by the Centrelink “clerk” whether he wished to reschedule the lodgement of the application in order that an interpreter could be present, Mr Divjak decided to proceed without the interpreter because he considered a delay was unacceptable. His evidence is that the subsequent interview took no longer than 10 to 15 minutes. Nor, he said, did the “Centrelink lady” explain the form nor the responsibilities that would become relevant under the AOS when Mrs Pribicevic entered Australia. When asked by the Respondents whether he had contacted the Department of Immigration and Muticultural and Indigenous affairs (“DIMIA”) or an immigration agent as to his responsibilities, Mr Divjak replied ”No - why should I”.
17. That same day, by letter dated 15 June 2005 (T18), Centrelink advised acceptance of the request for AOS. That letter advises that DIMIA has been notified, and defines the responsibilities of Mr Divjak as an Assurer for the two years from the date of arrival of the Assuree (Mrs Pribicevic). It further advises that the AOS “cannot be cancelled or withdrawn for any reason”, and identifies various Centrelink payments which would have to be repaid in the event that the Assurer is “unable or unwilling to provides sufficient support”. The letter was, however, addressed to the previous residence of Mr Divjak, namely Saunders Crescent, Liverpool, rather than the address on the application for AOS. Mr Divjak could not recall receiving the letter.
18. Mr Divjak met Mrs Pribicevic at the airport on her arrival in August 2005. He and his wife subsequently entertained the Pribicevics at their home on one or two occasions, and also saw them at their home on one or two occasions. At no time did he discuss with Mr Pribicevic what support might be needed by Mrs Pribicevic, nor did he see the need to do so.
19. On 29 December 2005, Mrs Pribicevic lodged a claim with Centrelink for Special Benefit (T20), stating that as a result of domestic violence, she had separated from her husband on 25 November 2005 (T21), that support from him had ceased, and that she was living in a womens’ refuge. A social worker report of 29 December 2005 (Bundle 3 T71) reports Mrs Pribicevic as being “in hiding from her assurer and husband”, and the Centrelink investigation, brief as it was (T20 p65), assessed Mrs Pribicevic as being in financial hardship. Special Benefit was granted from 16 December 2005 and continued until 20 April 2006.
20. The Guide to Social Security Law states at 9.4.7 “AoS – Debt” that whilst Centrelink “SHOULD contact the assurer before granting any recoverable social security payments to the assuree”, where the assuree might be placed at risk, Centrelink may “defer contacting the assurer until the social worker assesses the risk of harm is sufficiently diminished. This would generally be no longer than 3 months after recoverable social security payments are granted”. In this case, and presumably on the assumption that whilst not apparently directly involved in the domestic violence situation, Mr Divjak may side with, or support, Mr Pribicevic, the decision was taken not to inform him of the granting of Special Benefit.
21. In evidence, Mr Divjak stated that he had not taken sides when the Pribicevic marriage failed. In response to the Respondents, he stated that had he been asked, he (and his wife) could have supported Mrs Pribicevic financially – in cross examination he confirmed that he had no financial problems – and indeed could have provided accommodation for her in their home. He further stated that “by signing the agreement I had a responsibility”. The Respondents argued that such an arrangement was quite impracticable; that may well have proved to be the case had it been put to the test, but it was not, as Mr Divjak was not asked to assist. Later in cross examination Mr Divjak said “I was ready to help in that sense, but I did not know that I am responsible for paying for the scholarships for that person, to pay for their schooling fees. I did not understand it in that manner”.
22. On 2 January 2006, Mr Divjak informed DIMIA by letter that he was withdrawing his sponsorship of Mrs Pribicevic as the marriage had failed. He stated that the letter, and a similar one from Mr Pribicevic, was drafted by a friend. He did not inform Centrelink of this action, and even had he done so, the conditions of AOS would preclude reneging of his responsibilities. The response from DIMIA dated 16 February 2006 (T26), if it was read in the context of cancellation of the AOS and if Mr Divjak was aware of the financial implications of the AOS – and here there is some doubt as to just what he understood albeit he stated in evidence that he thought his responsibilities had been concluded with the cancellation of the sponsorship – could have been quite misleading, in my view, given that it stated “this fulfils your obligations in regard to the application”.
23. On 20 April 2006, the Assuree obtained an Apprehended Violence Order (“AVO”) against Mr Pribicevic (Bundle 3 T73), and Mr Stojanovic stated that there was also a conviction for assault in April 2006. On 28 April 2006, Mrs Pribicevic was granted NSA, payment continuing until 8 February 2007. The evidence is that Mr Divjak was not informed of this grant; nor was he yet informed of the grant of Special Benefit some 4 months earlier. A file note of 24 April 2006 (Bundle 3 T75) refers to an interview of Mrs Pribicevic by the social worker resulting in the latter requesting a delay in informing the Assurer of the situation – as would normally happen after three months vide the Guide to Social Security Law (as referred to above). Centrelink agreed to this delay, putting action on hold until 5 May 2006.
24. A Centrelink letter dated 8 May 2006 (T30) advised Mr Divjak that the balance of his account in respect of the AOS for the Assuree was $4,064.89. This letter did not refer to payments arising from the granting of Special Benefit, but only to NSA payments, hence given the dates stated (viz. 21 April 2006 to 4 May 2006), the AOS debt was presumably in error. (A subsequent file note (T31) is equally in error) The letter was addressed to 4 Saunders Crescent, Liverpool, the previous residence of Mr Divjak which as earlier stated, predated his application for AOS in June 2005).
25. Mr Divjak claims that he did not receive this letter. The file note at T31, raised on 6 June 2006, notes that “Customer contacted Assurance support regarding a general enquiry for AOS”. Mr Divjak denies that he made such a call, on the basis that he had no reason to do so as he had not received any correspondence or communication from Centrelink and was not aware that any payments were being made against the AOS. A further file note (T33) on 31 July 2006 also refers to customer contact. Again Mr Divjak denies that he was the originator of any call to Centrelink.
26. On 30 October 2006, Centrelink wrote to Mr Divjak (T34) advising the current balance of account as $9514.16, referring only to a NSA debt. Again, this letter was addressed to Saunders Crescent, Liverpool. Under cross examination, Mr Divjak stated that he first became aware of this AOS debt when this letter was passed to him, via his brother, from the tenants at Saunders Crescent, Liverpool. On 11 December 2006, Mr Divjak advised Centrelink of his correct address (File note – Customer contacted CC Liverpool – T36) and on 4 January he again contacted Centreliink (T38), apparently seeking information about the NSA.
27. On 4 January 2007, Centrelink received a letter written in the Serbian language, and a document seeking review (Exhibit A2), from Mr Divjak. The thrust of his letter was to express concern, amongst other matters, at the circumstances of the AOS debt, that no interpreter had been present when applying for the AOS, that he believed his obligations had completed with the reply from DIMIA on 16 February 2006 regarding “cancellation of his sponsorship”, and that he had never been informed of the actions of the Assuree. On 22 January 2007, Centrelink requested a translation of this letter (by 27 January). That translation (T43) is marked as having been received on 2 February 2007. In evidence, Mr Divjak stated he went to Liverpool Centrelink on a few occasions – and called the interpreting service – to ask what was happening, to be told it “was being dealt with on a higher level”.
28. Whilst the above was taking place, Centrelink received a claim for Austudy (marked as 29 January 2007) by the Assuree, this being granted to take effect from 9 February 2007, the start date of the relevant study being recorded as 5 February 2007. The Assurer was not made aware of this request, and hence not asked whether he would be willing and able to provide support (section 578B of the Act refers). Whether he had the capacity to provide appropriate support, and whether it would have been “reasonable for the assuree to accept that support” was not tested. A later file note of 6 March 2007 (Bundle 3 T81) refers to a request by the Assuree for Austudy being “rejected due to AOS”, but no evidence was put forward in respect of this matter. It further notes that a “letter to the assuror was suppressed and a review will be set up in 3 months”. The next debt advice was sent to Mr Divjak, to his current address, on 29 June 2007.
29. The appeal process against the AOS debt – which totalled $15,514.24 as at 14 June 2007 – following Mr Divjak’s “formal appeal” lodged on 4 January 2007, and his later letter of 10 May 2007, followed. The decision was affirmed on 22 June 2007 after reconsideration and following a further letter from Mr Divjak on 27 June 2007, and was upheld by the ARO on 20 July 2007. The subsequent decision of the SSAT to waive 50% of the debt, and of any debt yet to be calculated (to the completion of the AOS period on 13 August 2007) is as earlier noted.
30. In an affidavit dated 9 September 2008 (Annexure 5 to Exhibit R2), Mrs Pribicevic (in her maiden name of Starcevic) provides some background to the circumstances of her breakup with Mr Pribicevic and the domestic violence that led to the AVO. She states that following separation she had no contact with her husband in the belief that if found he would assault her. She further states that:
On or about 1 or 2 December 2005 I rang Stevo Divjak at his home. This was the person responsible for sponsoring my visa. The person answering the phone hung up on me after I announced who I was.
Sometime after this incident, I received a letter which was left in mail box at my place of residence. This letter was not in English but has been translated. I read this document and it noted that a private investigator had been used to find me. I was very scared when I received this document as I wanted my address to remain unknown.
I have had no contact with Mr Pribicevic or Stevo Divjak since that time.
31. Mr Divjak denied any knowledge of a telephone call from the Assuree, and stated that his wife would not have responded to a call in the manner suggested as she “got on well” with Mrs Pribicevic. As to the mailbox incident, an undated letter – but clearly one written after the expiration of the AOS as evidenced by the amount of the debt – in the Serbian language from Mr Divjak to Mrs Pribicevic together with an attached Statement of Expenses (both translated) and the addressed envelope were taken into evidence (Exhibit R2). Mr Divjak stated that Mr Pribicevic had hired an investigative agency to find his wife when he was unable to ascertain her whereabouts. Mr Divjak financed this activity, and defended his actions on the grounds that he believed Mrs Pribicevic should acknowledge the extent of the debts and agree to repay those costs.
32. Of relevance, the letter states:
I am writing to you this letter just in case that I would not find you at home, or that you would not want to talk with me. … here enclosed is a Statement of Expenses showing the amount of my money you spent, and the additional amount I had to spend on defending myself from this obligation … as you are obviously trying to escape from your obligation.
Mr Divjak stated in evidence that he believed Mrs Pribicevic had a full time job in December when claiming Special Benefit. He based that view on a letter from the AMP to Mrs Pribicevic dated 1 February 2006 (Exhibit A3), referring to superannuation in her name. He had obtained the document from Mr Pribicevic, who he presumed had received it in the mail. The document does not provide evidence that Mrs Pribicevic was working in December 2005.
THE LAW AND SUBMISSIONS
33. Section 1061ZZGA of the Act relevantly states:
assurance of support means an undertaking by a person under this Chapter that the person will pay the Commonwealth an amount equal to the amount of social security payments that are:
(a) received in respect of a period by another person who:
(i) is identified in the undertaking; and
(ii) becomes the holder under the Migration Act 1958 of a visa granted in connection with the undertaking (whether or not the person continues to hold the visa throughout the period); and
(b) specified in a determination in force under section 1061ZZGH when the payments are received.
Section 1061ZZGEA provides that a person who has given an AOS that has been accepted cannot withdraw that assurance once the person in respect of whom the assurance was given becomes the holder under the Migration Act 1958 of a visa granted in connection with the assurance.
34. Section 1061ZZGG refers to the liability for social security payments and relevantly states that the assurer is liable to pay the Commonwealth the amount of the social security payment if:
(a) a person (the assurer) has given an assurance of support that has been accepted under this Chapter; and
(b) a social security payment is received, by another person who is identified in the assurance, in respect of all or part of the period for which the assurance is in force in respect of the other person; and
(c) the social security payment is specified for the purposes of this section in a determination in force under section 1061ZZGH when the payment is received.
35. Section 1227 of the Act relevantly states:
(1) If a person is liable to pay an assurance of support debt, the debt is a debt due to the Commonwealth.
Section 1236 provides that in certain circumstances that debt may be written off (that is recovery may be deferred) and section 1237AAD provides for waiver thus:
The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a) the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii) failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and
(b) there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c) it is more appropriate to waive than to write off the debt or part of the debt.
36. Section 1237AAE of the Act addresses extra rules in respect of waiver of AOS debts, whereby the Secretary may waive under section 1237AAD the right to recover all or part of the debt only if the Secretary is satisfied that the waiver is justified on grounds other than one or more of the assurers being unaware of the effect of section 1061ZZGG, or of regulations made under the Migration Act 1958, in connection with the assurance.
37. Of relevance is section 578B which provides that:
An assurance of support applies to a person if:
(a) an assurance of support is in force in respect of the person (the assuree); and
(b) the person who gave the assurance is willing and able to provide an adequate level of support to the assuree: and
(c) it was reasonable for the assuree to accept that support.
38. Sections 578, 596A and 729 refer respectively to the relevant payments of Austudy, Newstart allowance and Special Benefit and provide the conditions under which such payments may be made where an assurance of support is extant.
39. I revert to final submissions of both parties rather than addressing piecemeal the arguments raised by Mr Divjak in the course of his letters to Centrelink appealing against the decision to raise a debt, and the arguments raised on file in defence of the decision by Centrelink.
40. In addressing the sole relevant question in this matter, (section 1236 of the Act, in respect of writing off the debt, is not relevant, given the debt is recoverable at law and Mr Divjak has demonstrated the capacity to pay) that is, whether there are special circumstances such as to have the debt of $8503.05 waived under the provisions of section 1237AAD, Mr Stojanovic submitted – in respect of eligibility for NSA – that the Respondents had failed to follow the prescribed procedure under the Act, in that the requirements of subparagraphs (b) and (c) in section 596A were not followed. These subparagraphs respectively require that in order to grant NSA – and here Mr Stojanovic observed that similar conditions applied to the criteria for granting Special Benefit and Austudy payments when an AOS is in force - the Respondents must be satisfied that Mr Divjak was willing and able to provide an adequate level of support and that it was reasonable for the Assuree to accept that support.
41. Mr Stojanovic submitted that this failure by the Respondents had occurred on three separate occasions, and in the case of the claim by the Assuree for Special Benefit in December 2005, the “office use only” column on the claim form (T20 p60), marked as compulsory, was marked as “Yes” as to the existence of an AOS, and “N/A” in respect of Assurer interview arrangements.
42. The second submission by Mr Stojanovic is that the evidence makes it “crystal clear” that “all and any” correspondence forwarded by Centrelink to the assurer went to the wrong address. He submitted that in applying for AOS, Mr Divjak had clearly given his address as 7/11 Hart Street, Warwick Farm, yet subsequent correspondence (until late 2006) went to Saunders Crescent, Liverpool. Accordingly, Mr Divjak was not advised of the acceptance of his application for AOS or the effect or consequences. Nor was he provided with an opportunity to come to a suitable arrangement, in the case of the three claims for social security payments, with Mrs Pribicevic or the Department.
43. Mr Stojanovic referred to the situation of Mr Divjak and his evidence that given the full-time employment of both Mr Divjak and his wife, he could have provided financial support to Mrs Pribicevic, could have provided accommodation, and probably could have obtained work for Mrs Pribicevic. Mr Stojanovic also referred the Tribunal to the Guide to Social Security Law (“the Guide”), wherein it states at 9.4.7 that Centrelink must establish whether “the assurer is willing and able ...”. This was not done, nor was the second requirement met as to whether “it is reasonable for the assuree…” the response to which, he suggested, will never be known as no contact was made.
44. Mr Stojanovic further referred to the subsequent direction in the Guide whereby Centrelink “SHOULD contact the assurer before granting any recoverable social security payment …”. He observed that this instruction made reference to the phrase “as discussed in the AoS interview”. Given the evidence of Mr Divjak that no interviewer was present when he made his application and that the activity was of relatively short duration – a statement not disproved – Mr Stojanovic considered that Mr Divjak was further disadvantaged.
45. Mr Stojanovic opined that the circumstances in Re Phan and Secretary, Department of Employment and Workplace Relations [2006] AATA 76 are similar to those before me. In that matter, which also concerned AOS, it was accepted that Mr Phan did not receive advice that the assuree had applied for NSA because he had moved. He was not contacted by Centrelink, and “was therefore denied the opportunity to make arrangements or agreements … for her financial support. He … believes he could have obtained employment for Ms Phan rather than her having to claim benefits.” Of significance in that matter, Mr Phan had previously given AOS on a number of occasions, had met financial obligations as required on some occasions, and acknowledged that he was aware of his obligations for AOS. Drawing on Re Beadle and Director-General of Social Security (1984) 6 ALD 1 and the subsequent Full Federal Court decision, and Ryde v Secretary, Department of Family and Community Services [2005] FCA 866, that Tribunal found that the case “was out of the ordinary and that there is hardship or unfairness that is sufficient to justify departure from the general rule … it is appropriate to waive the debt”.
46. As to the two Centrelink file notes of June and July 2006 that stated “Customer contacted Assurance Support”, Mr Stojanovic pondered whether the calls might have originated from Mrs Pribicevic, given that she, and not Mr Divjak, was the customer in this matter, or whether the caller might have been Mr Pribicevic. There was no evidence to support these conjectures, but there was the sworn evidence of Mr Divjak that he had not made the calls.
47. For the Respondents, Mr Lozynsky submitted that Mr Divjak should remain responsible for the outstanding debt of $8503.05, as he had signed the AOS application, and in doing so had given a legal undertaking to provide financial support to Mrs Pribicevic during the two year period of support. His earlier sponsorship of Mrs Poluga, and perhaps his own wife, was relevant as to his understanding of his obligations. The Respondents also expressed doubts as to the claim by Mr Divjak that his application for AOS in 2002 was not witnessed by a Justice of the Peace. The Respondents did not accept that Mr Divjak was unaware of his obligations in respect of the AOS for Mrs Pribicevic, but if he was uncertain, he made no effort to ascertain exactly what his obligations were. (I do not accept the suggestion in cross examination that Mr Divjak could have sought advice from DIMIA; vide the application form, he was dealing direct with Centrelink). Mr Lozynsky submitted that the decision by Mr Divjak to proceed with his application in the absence of an interpreter was of his own making.
48. As to the letter of 2 January 2006 to DIMIA withdrawing his sponsorship of Mrs Pribicevic because of the circumstances of the failed marriage, the Respondents accepted that Mr Divjak may not have fully understood the distinction between sponsorship – in terms of the granting of a visa – and assurance of support. As advised by DIMIA, the former was concluded when Mrs Pribicevic entered Australia; the latter was an ongoing liability to the Commonwealth for the duration of the resultant two years. But again, Mr Divjak did not seek clarification of the situation. In any event, once signed and approved, the AOS cannot be withdrawn under the conditions in section 1061ZZGEA of the Act.
49. The Respondent submitted that special circumstances did not exist in this case, and the debt – already reduced by the SSAT – should not be further reduced. That Centrelink did not contact Mr Divjak prior to granting social security benefits to the Assuree was understandable in the circumstances of the domestic violence issue between Mr Pribicevic and the Assuree, and the friendship between the former and Mr Divjak. Further, the action by Centrelink accorded with the Departmental policy as described in the Guide, and Mr Lozynsky submitted that Centrelink correctly followed procedures by referring the matter to the social worker, and then acting upon her advice. Mr Lozynsky submitted that notwithstanding, and whilst Centrelink had rightly adhered to internal policy guidelines, there is no legislative requirement for the Department to notify the Assurer of an application by the Assuree for income support payments, citing the decisions of the tribunal in Re Secretary, Department of Family and Community Services and El Hawli (also known as Hassan) (AAT 13491, 27 November 1998) and Re Haykal and Secretary, Department of Social Security (AAT 10895, 29 April 1996). Mr Lozynsky further opined that Mr Divjak was not disadvantaged by any delay in advising him of the accruing debt, citing Re Lamvohee and Secretary, Department of Social Security (AAT 12166, 28 August 1997).
50. Mr Lozynsky submitted that Mr Divjak’s subsequent involvement in the investigation to ascertain the whereabouts of Mrs Pribicevic – irrespective of whether he or Mr Pribicevic arranged such investigation - and the fact that he placed mail in her letterbox, were evidence to show “that Mr Divjak was, and I say, harassing the Assuree for repayment of the debt.” That Mr Divjak “went out of his way to incur additional expenses to track her down” was further evidence of harassment or intimidation, and evidence that the actions of Centrelink were correct.
51. Finally, the Respondent submitted that contrary to a view put forward by Mr Stojanovic, the Assuree is quite entitled to claim Special Benefit payment (vide s 729(2)(h) of the Act as amplified by s 729(2C)) during the period of the AOS, as the Assuree is also entitled to claim NSA and Austudy.
52. In considering special circumstances under the provisions of section 1237AAD , section 1237AAE requires that a waiver of whole or in part of an AOS debt only be given on grounds other than that the assurer was unaware of the obligations under section 1061ZZGG or the Migration Act 1958. The Respondents submitted that Mr Divjak had unduly emphasised that he was unaware of his obligations, but that other issues should be addressed when considering whether special circumstances existed. And in the context of considering the latter, and taking account of relevant and well recognised Federal Court decisions as they defined special circumstances, Mr Lozynsky submitted that the circumstances of Mr Divjak, including his financial situation, were not such as to warrant waiver under section 1237AAD.
CONSIDERATION
53. Liability for Special Benefit, NSA and Austudy payments made to an assuree (Mrs Pribicevic) rests within the legislation at section 1061ZZGA of the Act. Mr Divjak sought assurance of support for Mrs Pribicevic, and hence undertook to meet the conditions relevant to that AOS. AOS cannot be withdrawn once approved and the visa has been granted to the Assuree (section 1061ZZGEA refers). The AOS period of two years then takes effect when the Assuree arrives in Australia.
54. Prior to his application for AOS on 15 June 2005, Mr Divjak had followed the same process – albeit his application was made through DIMIA and processed in Belgrade – in obtaining an AOS to provide the guarantee to enable Mrs Poluga to gain a visa for entry into Australia. That form states, in English, that the Assurer undertakes to pay the Commonwealth the funds paid to the Assuree by way of Special Benefit, etc, whilst the AOS is in force. Thus it can be argued – as it is by the Respondents – that Mr Divjak was well aware of the legislative requirements when applying for an AOS for Mrs Pribicevic. There is no evidence before me to indicate whether Mrs Divjak also entered Australia under the same conditions, and even if she did, there is no evidence before me to confirm that Mr Divjak was responsible.
55. A number of factors must be considered in mitigation. Mr Divjak professes to a rudimentary knowledge of the English language, and there is no evidence to confirm that he adequately understood the conditions in the Statutory Declaration in the AOS application for Mrs Poluga. There is also no evidence before me that Mrs Poluga made any claims for social security benefits during the period of the AOS, or that Mr Divjak was contacted in that respect by Centrelink. Thus he brought no first hand experience of the social security claims process into the AOS period involving Mrs Pribicevic. His situation was therefore significantly different to that of the applicant in Re Phan. On his evidence, which has not been refuted, it follows that in the absence of an interpreter, he may well have been uncertain as to his obligations for the support of Mrs Pribicevic, and his letter to DIMIA of 2 January 2006 may well reflect a belief that his responsibilities ceased with the withdrawal of sponsorship.
56. Of further relevance, section 1061ZZGG of the Act in effect refers to the Assurer’s responsibilities when an AOS “has been accepted”. Notwithstanding that Mr Divjak signed a Statement by Assurer, which identified obligations in respect of Centrelink payments to the Assuree, Centrelink did not formally advise him of acceptance of his application and the responsibilities that followed, as the relevant letter of 15 June 2005 was posted to the wrong address. Mr Divjak had no responsibility in that regard, having clearly given his correct address at Warwick Farm on his form of application. It is a moot point as to what, if any, verbal briefing on his projected responsibilities under the conditions of the AOS was given to Mr Divjak when he lodged his application; the Respondents brought no evidence in this regard. Suffice that from the date of his lodgement of the AOS application on 15 June 2005, Mr Divjak did not receive any documentation from Centrelink until late in 2006.
57. That there is “no legislative requirement for the Department to notify the Assurer of the application for income support payments” as postulated by the Respondent, requires examination. Section 578B of the Act would seem to imply that ascertainment of the ability of a prospective assurer at the outset to be “willing and able to provide an adequate level of support” is taken for granted as applying, without further consideration, throughout the terms of the AOS period. On the contrary, sections 578, 596A and 729, applying as they do to particular social security benefits, state that the ability of the assurer to provide support (and whether the assuree is prepared to accept that support) must be considered against the relevant claim. The Respondents rightly observe (in a Statement of Fact and Contentions (Exhibit R1)) that the “Departmental guidelines (Guide to Social Security Law) with respect to AoS cases are not binding in law”, yet in this matter, the Department gave those guidelines precedence over what is, in my view, the legislative requirements.
58. The referral of claims by Mrs Pribicevic for social worker consideration is not questioned in the circumstances of reported domestic violence. But there is no evidence of any note that the Assurer’s responsibilities, rather than the situation in respect of Mrs Pribicevic’s husband, were fully considered. The initial report by the social worker, relevant to the claim for Special Benefit on 29 December 2005, stated that Mrs Pribicevic “is in hiding from her assurer and husband”; the next report is dated 4 months later and states “she would prefer that contacting assurer be delayed for a short while”. At that time, Centrelink had not conformed to the guidance in the Guide for Social Security Law in that Mr Divjak had not been informed in accordance with the “generally no longer than three months…” criteria. Indeed, the first notification to him that he had incurred an AOS debt was not provided until the following month, by which time Mrs Pribicevic had also been granted NSA, and then it was to the incorrect address. I note that notwithstanding the raising of the domestic violence issue in December 2005, the AVO was not effected until 4 months later; I presume this followed the conviction for assault. I also note, but do not consider it relevant to the matter before me, that a further AVO – subject to appeal – is now in place.
59. Whilst I have reservations that someone other than Mr Divjak made the two telephone calls to Centrelink Assurance Support (6 June 2006 and 31 July 2006), his oral evidence was that he had not made these enquiries, and that the first advice he received as to the mounting AOS debt occurred in late 2006, when he received the Centrelink letter of 30 October 2006.
60. Section 1237AAD, in respect of waiver in special circumstances, is the only legislative matter under which Mr Divjak can seek debt relief in respect of the AOS. The SSAT concluded that waiver under s 1237AAD was desirable, and decided that 50% of the debt should be waived. The issue before me is whether there are special circumstances whereby the remaining debt should be further reduced or waived in toto. Section 1237AAD requires me to be satisfied that the debt did not result wholly or partly from Mr Divjak (or another person) knowingly making a false statement or false representation. I am so satisfied on the evidence before me. The matter must then be considered against the criteria in s 1237AAD(b), that is whether there are special circumstances (other than financial hardship alone) that make it desirable to waive.
61. The term “special circumstances” is not defined in legislation, but the term has been considered in both the Administrative Appeals Tribunal and the Federal Court. The interpretation put forward by the Tribunal, with Toohey J presiding, in Re Beadle and Director General of Social Security (1984) 6 ALD 1, has been widely followed, and states:
An expression such as "special circumstances" is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend upon the context in which they occur. For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.
62. That Tribunal went on to say (at page 3) that "the existence of special circumstances is to be determined from all the circumstances..." which in the context of the matter before that Tribunal related to an application for handicapped child’s allowance. That "all the circumstances" should be considered in this matter is supported by the words of the Full Federal Court in dismissing an appeal against the above decision (Beadle v Director-General of Social Security (1985) 7 ALD 670), wherein it was stated at 674 in respect of whether special circumstances were evident in the delay in making a claim:
More difficult would be questions of ignorance, illiteracy, isolation, illness and the like. It would depend upon the circumstances of the particular case whether these constituted special circumstances. We do not think it is possible to lay down precise limits or precise rules.
Such a view was subsequently endorsed by the Full Federal Court in Dranichnikov v Centrelink (2003) 75 ALD 134 at [66] – [67].
63. Kiefel J in Groth v Secretary, Department of Social Security (1995) 40 ALD 541 observed that:
... although imprecise [it] is sufficiently understood not to require judicial gloss: Beadle’s case [(1985) 60 ALR 225, 7 ALD 670] (at ALR 229; ALD 674), and for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth’s case from others, to take it out of the usual or ordinary case... It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.
64. More recently, Besanko J concluded in Angelokas v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9 that there must be something that distinguishes the case from the ordinary or usual cases, stating:
I also note that the authorities have emphasised time and again the importance of maintaining flexibility in determining what constitutes special circumstances. The danger is that the test will be overstated if the word “exceptional” is emphasised. It was not the intention of parliament to confine the exercise of the discretion to an exceptional case. There is less risk of overstatement if the words “unusual” or ”uncommon” are emphasised. Those words indicate, correctly in my view, the fact that there must be something that distinguishes to case from the ordinary or usual case. It may not be easy to postulate the ordinary or usual case other than in quite general terms and, in doing so, close attention must be given to the particular statutory context.
65. Besanko J also referred to the view of French J in Secretary, Department of Social Security v Hales (1998) 82 FCR 154 that financial hardship was not necessary in order to make a finding of special circumstances. In the matter before me, financial hardship, on the evidence of Mr Divjak as to the financial circumstances of him and his wife, is not an issue. Ryde v Secretary, Department of Family and Community Services [2005] FCA 866 must also be taken into account in that Branson J observed (at [25]) that “The Full Court in Beadle did not endorse the view expressed by the Tribunal in Re Beadle and Director-General of Social Security (1984) 6 ALD 1 at 3 that circumstances are special only if they are ‘unusual, uncommon or exceptional’.” Her Honour considered the “hardship or unfairness” referred to by French J in Re Hales must be sufficient to justify departure from the general rule in a particular case.
66. It is necessary to consider all the factors before me as they relate to the AOS and the outstanding debt of $8503.05. That is, that half the original debt was waived by the SSAT does not, in my view, preclude me from considering all the relevant factors in reviewing the circumstances of the remaining debt. In doing so, I particularly follow the considerations in Re Angelokas and re Ryde, in that the matter before me must be distinguishable from the ordinary or usual case.
67. I believe it to be so. Notwithstanding that Mr Divjak had previously taken an AOS in respect of Mrs Poluga (wherein he apparently had no exposure to financial considerations), there is reason to believe that he was not made aware of the full implications of his application to support Mrs Pribicevic. Nor was he given the benefit of being informed that his application had been accepted; had he received the confirmatory letter of 15 June 2005, he would have been informed, or reminded, of the financial implications. He was also disadvantaged, in that contrary to the legislation, he was not accorded the opportunity to offer assistance to Mrs Pribicevic on each occasion that she claimed a social security benefit. That in the circumstances he may not have been able to assist, and thus would have incurred a debt, does not counter this finding. I take account, and accept, the obligations placed on Centrelink in respect of domestic violence, but consider that Mr Divjak (the Assurer) was, without investigation, swept up in the resultant process when the domestic violence issue was a matter between Mr and Mrs Pribicevic. No attempt was made to ascertain his involvement or otherwise. In my view, his situation might have been adequately investigated without compromising the whereabouts or intentions of Mrs Pribicevic. That he later sought recovery of the debt from Mrs Pribicevic - and here I consider the format and language in his letter to be reasonable - seems not unreasonable given that at no stage was he brought into the consideration of social security claims.
68. The above conclusions imply that the Respondent should bear the full responsibility for the debt. I do not believe, however, that this would be an appropriate and correct outcome. Whilst I have detailed the factors in mitigation that should be considered in reaching a decision in this matter, it must be accepted that in applying for an AOS for Mrs Poluga, and later Mrs Pribicevic, Mr Divjak had a responsibility to ensure that he knew the conditions under which his applications were being made and subsequently granted. That he chose to proceed with his application in the case of Mrs Pribicevic in the absence of an interpreter was a matter of his choice, and a decision he made in the knowledge that his command of the English language was limited. No evidence was put to me as to why his application could not be delayed until an interpreter was present. Further, whilst he did not receive the letter of approval of 15 June 2005, he made no attempt to ascertain whether approval had been granted, but seemingly accepted that it had occurred, given that he met Mrs Pribicevic on her arrival in Australia, and subsequently requested that DIMIA cancel his sponsorship.
69. Thus I acknowledge that Mr Divjak placed himself in a position of providing support, financial or otherwise, as required, to Mrs Pribicevic when he applied for Assurance of Support on her behalf. And having done so, he had, vide the conditions of such application, accepted an obligation over the two year period from her arrival in Australia. In the circumstances however, whilst I consider his case was out of the ordinary and that special circumstances are present, a waiver of 50% of the remaining debt of $8503.05 is an appropriate and balanced decision, given the Respondent’s responsibilities in this matter.
70. The decision of the Social Security Appeals Tribunal of 19 October 2007 is varied to the extent that the Commonwealth’s right to recover the debt of $8503.05 is waived in that 50% only of the debt is recoverable under the provisions of section 1237AAD of the Social Security Act1991.
I certify that the 70 preceding paragraphs are a true copy of the reasons for the decision herein of REAR ADMIRAL A R HORTON AO, Member
Signed: ..................[sgd]..............................................................
Mr T Aviram, AssociateDate/s of Hearing 10 September 2008
Date of Decision 23 October 2008
Solicitor for the Applicant Mr S Stojanovic, Stojanovic Solicitors
Solicitor for the Respondent Mr G Lozynsky, Centrelink Legal Services
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