Dunne and Secretary, Department of Employment and Workplace Relations
[2007] AATA 1151
•21 March 2007
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2007] AATA 1151
ADMINISTRATIVE APPEALS TRIBUNAL )
) No S2006/186
GENERAL ADMINISTRATIVE DIVISION ) Re PETER DUNNE Applicant
And
SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS
Respondent
DECISION
Tribunal Senior Member R W Dunne Date21 March 2007
PlaceAdelaide
Decision The Tribunal affirms the decision under review.
..............................................
R W DUNNE
(Senior Member)
CATCHWORDS
SOCIAL SECURITY – pensions, benefits and allowances – Disability Support Pension – debt due to the Commonwealth – waiver of right to recover debt – waiver in special circumstances – write-off of debt – decision affirmed
Social Security Act 1991 ss 1064(1), 1223(1), 1236(1) and (1A), 1237A(1), 1237AAD
Social Security (Administration) Act 1999 ss 68(2), 72(1)
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Riddell v Secretary, Department of Social Security (1993) 30 ALD 31Secretary, Department of Social Security v Hales (1998) 82 FCR 154
REASONS FOR DECISION
21 March 2007 Senior Member R W Dunne 1. In this matter, the applicant (Peter Dunne) applied for a review of a decision of the Social Security Appeals Tribunal (“SSAT”) made on 15 April 2005. The SSAT affirmed a decision of an Authorised Review Officer of the respondent (“Centrelink”) dated 11 February 2005 relating to the recoverable portion of a debt of $2,312.00 (“Debt”) due to the overpayment of a Disability Support Pension (“DSP”). The SSAT set aside the decision to recover the Debt and substituted its decision that recovery of the Debt should be written-off for a period of 12 months.
2. Mr Dunne appeared on his own behalf, while Mr Peter Edwards appeared on behalf of the respondent. The Tribunal received into evidence the T documents (Exhibit R1) and the Supplementary T documents (Exhibit R2) lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975, together with the respondent’s statement of facts and contentions which was submitted at the commencement of the hearing.
issues for the tribunal
3. The issues for the Tribunal are:
(a) whether there was an overpayment of DSP to the applicant under the Social Security Act 1991 (the “Act”);
(b) if there was an overpayment, whether it is recoverable by the respondent; and
(c) if the overpayment is recoverable by the respondent, are there grounds under the Act to waive or write-off all or part of the overpayment.
4. The applicant did not dispute that an overpayment of DSP had occurred.
legislation
5. The following provisions of the Act and the Social Security (Administration) Act 1999 (the “Administration Act”) are relevant to this matter:
The Act
“1064(1)The rate of:
(a) age pension; and
(b)disability support pension or disability wage supplement of a person who has turned 21; and
(c) wife pension; and
(d) carer payment; and
(f) mature age allowance under Part 2.12A; and
(g) mature age partner allowance;
is, subject to subsection (2), to be calculated in accordance with the Rate Calculator at the end of this section.
…
1223(1)Subject to this section, if:
(a) a social security payment is made; and
(b)a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit;
the amount of the payment is a debt due to the Commonwealth by the person and the debt is taken to arise when the person obtains the benefit of the payment.
…
1236(1)Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.
1236(1A)The Secretary may decide to write off a debt under subsection (1) if, and only if:
(a)the debt is irrecoverable at law; or
(b)the debtor has no capacity to repay the debt; or
(c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
(d)it is not cost effective for the Commonwealth to take action to recover the debt.
…
1237A(1)Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
…
1237AAD Waiver in special circumstances
The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii)failing or omitting to comply with a provision of this Act 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
…”
The Administration Act
“68(2) The Secretary may give a person to whom this subsection applies a notice that requires the person to do either or both of the following:
(a) inform the Department if:
(i) a specified event or change of circumstances occurs; or
(ii)the person becomes aware that a specified event or change of circumstances is likely to occur;
(b)give the Department one or more statements about a matter that might affect the payment to the person of the social security payment.
…
72(1)A notice under this Subdivision:
(a)must be given in writing; and
(b)may be given personally or by post or in any other manner approved by the Secretary; and
(c)must specify how the person is to give the information or statement to the Department; and
(d)must specify:
(i)in the case of a notice under section 68 that requires the giving of more than one statement, each relating to the payment of the social security payment in respect of a period—the date by which the person is to give each statement to the Department; or
(ii)in any other case—the period within which the person is to give the information or statement to the Department; and
(e)must specify that the notice is an information notice given under the social security law.
…”
background
6. Mr Dunne was granted a DSP on 9 March 2001 (“DSP Date”). He lived with his wife from the DSP Date until 15 December 2003, when they separated. From the DSP Date until the parties separated, the income earned by Ms Dunne was taken into account by Centrelink in calculating Mr Dunne’s entitlement to DSP. Centrelink sent recipient notices to Mr Dunne dated 24 April 2001 and 2 May 2001 advising him that his combined annual income had been assessed at $43,002.01 and asking him to advise, within 14 days, of any combined income increases that occurred. Through enquiry with Ms Dunne’s employers, Centrelink ascertained that Mr Dunne’s combined income with his wife had been under-declared. On 6 July 2004, Centrelink advised him of the under-declaration during the period from 1 September 2001 to 14 December 2003 and that an overpayment of DSP of $3,370.11 had occurred and was a debt due to the Commonwealth. However, Mr Dunne was also advised that part of the overpayment had arisen, due to an administrative error, and that the amount of the overpayment was reduced by $1,058.11 to $2,312.00 (Exhibit R2, T21 at page 158).
7. It was Mr Dunne’s evidence that the Debt ($2,312.00) had been thrust upon him and was stopping him moving forward with his life. Although he was repaying the Debt by deduction of $20.00 a fortnight, he was now receiving the single rate of DSP and was “doing it tough”. He had been a carpenter for 25 years and, in the last 2 years, was trying to move forward and improve himself. He had applied to undertake a college course which was due to start on 6 February 2007. Once qualified, it was his intention to re-enter the workforce as a home-based computer technician. He said that he needed access to a motor vehicle and that, without such access, there was the risk that his college course would not be finished. His living expenses had increased and, with the $20.00 fortnightly deduction from his DSP, he found it increasingly difficult to make ends meet. He said that, because of the Debt, he was unable to access a Centrelink advance of $500.00 on his DSP. He also said that he had been suffering from depression and had a letter from his treating doctor. However, he was unable to produce the letter to the Tribunal.
8. In cross-examination by Mr Edwards, Mr Dunne said that he had trouble with transport, but that assistance in the form of a one-off Mobility Allowance payment would be coming through sometime after 6 February 2007. Currently, he was receiving DSP of $601.00 per fortnight, after the fortnightly deduction of $20.00 in repaying the Debt. Although the Debt was originally $2,312.00, the amount outstanding at the time of the hearing (according to Mr Edwards) was $1,583.00. As the Tribunal understood his evidence, Mr Dunne said that his motor vehicle had been involved in an accident and repairs to it were needed. He was becoming increasingly concerned at his predicament and his mental health was being adversely affected.
contentions of applicant
9. Put simply, Mr Dunne’s contention was that his circumstances were such that the Debt should be waived or written-off. With the amount of the Debt outstanding, Centrelink was incurring more in recovery costs than the amount that was due to be repaid to it. After deduction of the $20.00 fortnightly repayments, he was experiencing considerable hardship in meeting his living expenses. Because of this, there was the risk that he would be unable to finish his college course, so as to qualify to be able to re-enter the workforce. This would mean that he would continue to be in need of DSP and remain a drain on Centrelink funds. He contended that all these factors demonstrated special circumstances that required that the Debt should be waived. Alternatively, and for the same reasons, the Debt should be written-off because it was uneconomical for Centrelink to continue to seek recovery.
consideration and application of the law
10. Under s 68(2) of the Administration Act, a person who is receiving DSP may be given a notice which requires the recipient to inform Centrelink of a specified event or change of circumstances or to give Centrelink a statement about a matter that might affect the payment to the person of DSP. Section 72(1) of the Administration Act sets out the information to be included in the notice, including the period within which the person is to give the information to Centrelink. The Tribunal understood it was accepted by the parties that the letters forwarded to the applicant by Centrelink on 24 April 2001 and 2 May 2001 were notices in terms of s 68(2) of the Administration Act and had effectively been given to the applicant.
11. Section 1223(1) of the Act sets out the circumstances where a recoverable debt arises from the receipt of Social Security payments, including DSP. A debt due to the Commonwealth by a recipient may be waived by the respondent, pursuant to s 1237A(1) or s 1237AAD of the Act, if certain circumstances exist. Section 1237A(1) is mandatory where a debt has arisen which is solely due to an administrative error by the respondent.
findings of fact
12. The Tribunal, after taking into account the evidence as a whole, including the legislation, authorities and submissions by the applicant and on behalf of the respondent, makes the following relevant findings:
(a) After the applicant commenced receiving DSP, on 24 April 2001 and 2 May 2001, he received notices requiring him to inform Centrelink, within 14 days, if the combined income (with his wife) increased over the amount stated in the notices.
(b) The applicant was unaware that his wife’s employment income had increased and had not been correctly taken into account to work out his DSP in the period 1 September 2001 to 14 December 2003. The Tribunal accepts that this was an innocent mistake or failure on the part of the applicant.
(c) On 6 July 2004, Centrelink decided to raise and recover an overpayment of DSP of $3,370.11 paid to the applicant for the period from 1 September 2001 to 14 December 2003.
(d) On 6 July 2004, Centrelink decided to waive part of the debt due to the overpayment of $1,058.11 for the period from 11 June 2003 to 14 December 2003. This was because the applicant advised Centrelink at a review interview that he was unable to confirm his wife’s income, but nevertheless had received his DSP payments during this period in good faith. The amount of the overpayment that Centrelink was seeking to recover was reduced to $2,312.00.
13. The Tribunal is satisfied and so finds that the applicant received an overpayment of DSP during the period from 1 September 2001 to 10 June 2003. The overpayment occurred because the applicant failed to advise Centrelink that his combined income had increased, such that it was greater than the amount advised in the recipient notices sent to him dated 24 April 2001 and 2 May 2001. The Tribunal is also satisfied (and this is not disputed) that the applicant had been overpaid DSP during the relevant period. The amount of the overpayment is a debt recoverable under s 1223(1) of the Act and is not capable of being written-off under s 1236(1) of the Act.
write off of debt under s 1236(1A) of the act
14. Under s 1236(1A), the respondent may write-off a debt, for a stated period or otherwise, only in the following situations:
(a)If the debt is irrecoverable at law. The Tribunal has already found that the Debt is recoverable at law.
(b) If the debtor has no capacity to repay the debt. On the evidence before it, including that the applicant is in receipt of DSP of $601.00 per fortnight and a Mobility Allowance of $74.30 per fortnight, the Tribunal is satisfied that the applicant has capacity to repay the Debt.
(c)If the applicant’s whereabouts are unknown. This exception is not presently applicable.
(d) If it is not cost effective for the Commonwealth to take action to recover the debt. Having regard to the submission put to it by Mr Edwards, the Tribunal accepts that it is cost effective for the Commonwealth to take action (or to continue to take action) to recover the Debt.
15. It follows that the Debt is not capable of being written-off, for a stated period or otherwise, pursuant to s 1236(1A) of the Act.
waiver under s 1237A(1) of the act
16. There can be no question that the applicant did not receive DSP, which was overpaid during the period from 1 September 2001 to 14 December 2003, in good faith. Centrelink accepted that part of the overpayment, for the period from 11 June 2003 to 14 December 2003, should be waived, resulting in a reduced overpayment of $2,312.00. However, the Tribunal is not satisfied, on the evidence before it, that any part of the Debt was attributable solely to an administrative error made by the Commonwealth. In these circumstances, the Debt should not be waived under s 1237A(1) of the Act.
special circumstances under s 1237AAD of the act
17. It was Mr Dunne’s main contention that the Debt should be waived under s 1237AAD of the Act, on the ground that there were “special circumstances” that made it desirable to waive. In this regard, the Tribunal notes that the special circumstances must be other than financial hardship alone.
18. Mr Edwards referred the Tribunal to a number of cases dealing with the issue of “special circumstances” under s 1237AAD. The expression has been considered on numerous occasions by Courts and Tribunals. In the case of Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the Tribunal said (at page 3):
"…
An expression such as “special circumstances” is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend on 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.
…” (emphasis added)
19. In Groth v Secretary, Department of Social Security (1995) 40 ALD 541, Kiefel J, after referring to the Federal Court’s decision in Re Beadle, observed that special circumstances:
"… would require something to distinguish Mr Groth’s case from others, to take it out of the usual or ordinary case. … It would 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. …”
20. Finally, in Riddell v Secretary, Department of Social Security (1993) 30 ALD 31, the Full Court of the Federal Court said at page 38:
"Each particular case must be considered on its merits. It is the essential nature of the provision to create a broad discretion to meet the great variety of circumstances which must occur, raising considerations of individual hardship, need, fairness, reasonableness, and whatever else may move an administrator, keeping in mind the scope and purposes of the Act, to make a decision one way or the other."
21. The Tribunal notes the matters, referred to in paragraph 9 of these reasons, which Mr Dunne contended were, or amounted to, special circumstances. The Tribunal accepts that Mr Dunne has faced a number of difficulties in finding his feet and moving forward. He is attempting to become qualified in his chosen new occupation with a view to re-entering the workforce and ceasing to be a drain on Centrelink funds. He said that he had suffered from depression and that the burden of the Debt had affected his mental health. In considering this aspect, the Tribunal is satisfied that Mr Dunne’s health issues are not such that they could be classified as special circumstances within the meaning of that term as set out above.
22. With respect to his financial circumstances, the Tribunal appreciates that the applicant may have difficulty, at times, in making ends meet. Different expenses arise at different times and he meets them, as and when required. The Tribunal is satisfied that his financial circumstances, whilst they may be straitened and stressful at times, are not such that they can be categorised as special circumstances. In saying this, the Tribunal gains assistance from the comments of French J in Secretary, Department of Social Security v Hales (1998) 82 FCR 154, where (at page 155) he said:
“From time to time in the administration of social security benefits overpayments occur. Sometimes these are the result of innocent non-compliance with the requirements of the law which can be affected by the stress associated with the circumstances that led to the receipt of benefits in the first place. The taxpayer is entitled to expect that in the ordinary course money paid to people which they are not entitled to receive will be recovered, albeit in a way appropriate to the circumstances which led to the overpayment and the circumstances of the persons concerned. …”
23. After consideration of all of Mr Dunne’s circumstances, the Tribunal is satisfied that there are no special circumstances which would warrant the waiving of the Debt, and the Tribunal so finds. For the reasons given, the Tribunal is satisfied that the decision:
(a)to raise and recover the Debt of $2,312.00; and
(b)that recovery of the Debt should be written-off for a period of 12 months,
was correct and that the amount of the Debt of $2,312.00, or the remainder of the Debt (as the case may be), is now properly recoverable by Centrelink.
decision
24. The Tribunal affirms the decision under review.
I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member R W Dunne
Signed: ...........J Coulthard..............................................
AssociateDate of Hearing 30 January 2007
Date of Decision 21 March 2007
Advocate for the Applicant In personAdvocate for the Respondent Mr P Edwards
Centrelink Legal Services Branch
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