Epaminodas Sakoutis and Secretary, Department of Social Services - [2013] AATA 885

[2013] AATA 885

Division GENERAL ADMINISTRATIVE DIVISION

File Number(s)

2012/5796

Re

Epaminodas Sakoutis

APPLICANT

And

Secretary, Department of Social Services

RESPONDENT

DECISION

Tribunal Mr Dean Letcher, QC, Senior Member

Date 13 December 2013

Place Sydney
The decision under review is set aside and in substitution for it there be a decision that the proportion of the claimed debt of $14,181.26 referable to the period 18 April 2008 to 6 August 2009 is a debt due to the Commonwealth by the applicant pursuant to s 1223(1) Social Security Act 1991. The proportion of the claimed debt relating to the period 22 September 2006 to 17 April 2008 is waived pursuant to s 1237A(1) of the Social Security Act 1991.
........................[sgd]................................................
Mr Dean Letcher, QC, Senior Member
CATCHWORDS
SOCIAL SECURITY – debt – overpayment of Age Pension – whether debt should be waived – whether debt is attributable solely to an error of the Commonwealth – whether special circumstances exist – decision set aside
LEGISLATION
Social Security Act 1991 ss 1223, 1237A, 1237AAD

Social Security (Administration) Act 1999 s 66A
REASONS FOR DECISION
Mr Dean Letcher, QC, Senior Member
13 December 2013
BACKGROUND

The applicant seeks review of a decision of the Social Security Appeals Tribunal on 14 November 2012 that he was overpaid $14,181.26 Age Pension between 22 September 2006 and 6 August 2009, that this sum is a debt owed to the Commonwealth under s 1223(1) of the Social Security Act 1991 (“the Act”) and that the debt should not be waived under s 1237A(1) or s 1237AAD of the Act.
FACTUAL BACKGROUND
The applicant was born in 1941 in a village on the Greek island of Ikaria east of Athens in the Aegean Sea. His father was a farmer. Due to World War II and the subsequent Greek Civil War no teacher was available at the village school for some years. The applicant began schooling at age 8 and concluded when 13 or 14. He then worked the family farm, later laboured for a plumber and emigrated to Australia where he had a succession of jobs. He had no further formal education. He says he learned to speak, read and write English “in the workplace, read the paper to try to catch up, I never went to school here, I work all the time”.
When approaching age 65 the applicant was unemployed and receiving Newstart from Centrelink. His wife worked at a nursing home. He declared his wife’s earnings in fortnightly responses to Centrelink letters and he received a reduced Newstart amount as a result. He notified Centrelink accurately of her earnings on 6 September and the day before his 65^th birthday, when he became eligible for the Age Pension.
Centrelink gave him a Transfer to Age Pension – Income and Asset Review form prior to his 65^th birthday. He completed it, but the Centrelink clerk performing the transfer from Newstart to Age Pension made an administrative error and coded the couple’s combined annual earnings…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Epaminodas Sakoutis and Secretary, Department of Social Services [2013] AATA 885
Case: [2013] AATA 885
Decision Date

CaseChat Overview and Summary

The applicant, Epaminodas Sakoutis, sought review of a decision by the respondent, the Secretary of the Department of Social Services, to recover overpaid Age Pension payments amounting to over $14,000. The dispute was heard by the Social Security Appeals Tribunal, and subsequently, the Administrative Appeals Tribunal. The applicant contended that the overpayment was due to an administrative error by Centrelink and that he had acted in good faith. The Tribunal had to determine whether the overpayment was attributable to an error by the Commonwealth and if the applicant received the payments in good faith.

The Tribunal examined the legal criteria under sections 1223, 1237A, and 1237AAD of the Social Security Act 1991 to decide if the overpayment could be waived. Section 1237A permits waiver if the overpayment is due to an administrative error by the Commonwealth and the recipient acted in good faith. The Tribunal also considered the requirement under section 66A(1) of the Social Security (Administration) Act 1999 for the applicant to notify Centrelink of any changes in circumstances. The Tribunal scrutinised the evidence regarding Centrelink's letters to the applicant, which were alleged to inform him of his obligations to report changes in income. The Tribunal concluded that the letters did not sufficiently communicate the applicant's obligations regarding changes in his partner's income.

The Tribunal found that the proportion of the debt relating to the period 22 September 2006 to 17 April 2008 was attributable to an administrative error by the Commonwealth. The applicant had received the payments in good faith and had not been adequately informed of his obligations. Therefore, this portion of the debt was waived under section 1237A of the Social Security Act 1991. Conversely, the Tribunal determined that the portion of the debt from 18 April 2008 to 6 August 2009 was a valid debt due to the Commonwealth, as the applicant had not acted in good faith regarding the notification obligations during this period.

The Tribunal set aside the decision under review and substituted it with a decision that the portion of the claimed debt relating to the period 22 September 2006 to 17 April 2008 was waived. The portion of the claimed debt relating to the period 18 April 2008 to 6 August 2009 was upheld as a debt due to the Commonwealth.

Orders

Orders of the court

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Background

Background to the litigation

He received the full Age Pension until 6 August 2009 when Centrelink notified him that it had been alerted by “data-matching” with the Australian Tax Office to a discrepancy between Centrelink’s records of his wife’s income and the Australian Taxation Office’s record. He was informed by letter dated 8 June 2010 that he had been overpaid Age Pension for three years amounting to over $14,000.LEGAL BACKGROUND Under s 1223 of the Act overpayments are deemed to be debts due to the Commonwealth. Section 1237A allows waiver of a such a debt if it is “attributable solely” to an error by the Commonwealth, the person received the payment in good faith, and the debt is raised more than six weeks after the first payment that caused the debt or if the debt arose because a person complied with a notification obligation, the debt is not raised within a period of six weeks from the end of the notification period. Section 1237AAD of the Act also allows waiver of a debt where there are “special circumstances” and the recipient has not knowingly made a false statement or failed to comply with the Act or the Social Security (Administration) Act 1999. Section 66A(1) of the Social Security (Administration) Act 1999 provides that a person receiving a benefit must advise of any change in circumstances and requires that this be done within 14 days of the change. Although the applicant said that Centrelink had not contacted him after the 19 September 2006 disclosure, the respondent produced “archive copies” of Centrelink letters of 20 September 2006, 20 April 2007 and 17 April 2008 which the applicant agreed he might have received and read. These “archive copies” were taken from computer records and it was fairly said were not in the same format as the letters actually sent. Indeed, the archive letters were almost impossible for me to decipher although the figures $5.40 and $6.30 could be discerned in a maelstrom of symbols and punctuation marks. At my request, the respondent has attempted to reproduce those letters in approximately the same format as those actually sent. However, that attempt has been largely unsuccessful. The respondent says that:The data for letters of the period 2006-8 is saved only in the format provided in the Tribunal documents [that is, the “archive copies” at T9 and T10]. There is no hard copy of the letters is [sic] produced within the department, unless a particular letter has been printed off contemporaneously by an officer and placed on a hardcopy file. In response to a further enquiry by the Tribunal the respondent has confirmed:It is correct that we are unable to provide a better copy of the letters [that] are T9 and T10 than the archived copies that we have provided. The applicant was invited to comment on the situation but had no memory of the letters which could take the matter further. Doing the best that I can, given the paucity of the information about the form of the Centrelink letters from 2006, 2007 and 2008, my view is that the letters dated 20 September 2006 and 20 April 2007 do not state clearly that if his partner earns wages then he must inform Centrelink of any changes, nor that if he does so the amount he receives may be reduced. I do not think that this form of letter gives a direct indication of the applicant’s obligation which the respondent alleges.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

I am satisfied on the evidence before the Tribunal that the proportion of the claimed debt of $14,181.26 relating to the period 22 September 2006 to 17 April 2008 is attributable solely to an administrative error made by the Commonwealth and the applicant received in good faith the payments that gave rise to that proportion of the debt. Pursuant to s 1237A(1) of the Social Security Act 1991 the respondent must waive the right to recover that proportion of the claimed debt.DECISION The decision under review is set aside and in substitution for it there be a decision that the proportion of the claimed debt of $14,181.26 referable to the period 18 April 2008 to 6 August 2009 is a debt due to the Commonwealth by the applicant pursuant to s 1223(1) Social Security Act 1991. The proportion of the claimed debt relating to the period 22 September 2006 to 17 April 2008 is waived pursuant to s 1237A(1) of the Social Security Act 1991.

Ratio Decidendi

Legal Principle Established

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Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2012/5796
Re	Epaminodas Sakoutis
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

Tribunal	Mr Dean Letcher, QC, Senior Member
Date	13 December 2013
Place	Sydney