Gartside and Secretary, Department of Social Services (Social services second review) - [2017] AATA 45

Gartside and Secretary, Department of Social Services (Social services second review) [2017] AATA 45 (20 January 2017)
Division: GENERAL DIVISION
File Number: 2016/2431
Re:Damien Gartside
APPLICANT

AndSecretary, Department of Social Services
RESPONDENT

Decision
Tribunal:Senior Member J Sosso
Date:20 January 2017
Place:Brisbane

The decision under review is affirmed.
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Senior Member J Sosso
Catchwords
SOCIAL SECURITY – settlement of compensation for workplace injury – preclusion period – whether Applicant was subject to preclusion period – whether preclusion period was properly calculated – where the preclusion period was properly applied – whether special circumstances justified treating compensation payment as not having been made – where Applicant had some care of child – where Applicant had spent much of the compensation payment on drugs – whether financial hardship applied – insufficiently special circumstances for discretion to be used – decision under review affirmed
Legislation
Social Security Act 1991 (Cth), ss 17, 23, 1169, 1170, 1171, 1184K
Cases
Angelakos v Secretary, Department of Employment and Workplace Relations
[2007] FCA 25; (2007) 100 ALD 9

Beadle and Director-General of Social Security
(1984) 6 ALD 1

Bell and Secretary, Department of Social Security
[1998] AATA 284

Davis and Secretary, Department of Family and Community Services
[1999] AATA 84
Director General of Social Services v Hales (1983) 47 ALR 281
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Haidar v Secretary, Department of Social Security [1998] FCA 994; 52 ALD 255
O’Neill and Secretary, Department of Education, Employment and Workplace Relations [2009] AATA 619
Re Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114
Re Secretary, Department of Social Security and Gardiner [1991] AATA 112
Ryde and Secretary, Department of Family and Community Services [2005] FCA 866
Secretary, Department of Employment and Workplace Relations v Homewood [2006] FCA 779; (2006) 91 ALD 103
Secretary, Department of Social Security v Banks
(1990) 20 ALD 19

Secretary, Department of Social Security v Hulls
(1991) 22 ALD 570

Secretary, Department of Social Security and Thompson
[1993] AATA 641

REASONS FOR DECISION
Senior Member J Sosso
20 January 2017
Introduction

Mr Damien Gartside (the Applicant) suffered a workplace injury on 8 December 2005 which resulted in lower back strain and some loss of function to the upper left leg – Exhibit 1 T8 pp.42 and 44. The accident occurred in South Australia and the employer was Tatiara Meat Company Pty Ltd – Exhibit 1 T8 p.39.
On 20 November 2008 the Applicant received a lump sum compensation payment for non-economic loss of $32,766.72 - Exhibit 1 T8 p.42; T 7 p.35.
The Applicant’s compensation claim was finally settled by consent on 26 March 2015 and he received a final capital lump sum payment of $68,402.88 plus the value of his gross weekly payments of $657.72 per week multiplied by the number of weeks/days between the date of payment to and including 30 June 2015 – Exhibit 1 T8 pp.45 and 47. This payment was for economic loss. The payment of a lump sum was in lieu of receiving weekly payments of income maintenance from the Return to Work Corporation of South Australia.
The Applicant acknowledged that on receipt of the redemption payment he would have no further entitlement to weekly payments, and that there were consequences for claiming medical benefits from Medicare, amongst other things – Exhibit 1 T8 p.46.
On 4 June 2015 the Department of Human Services (Centrelink) wrote to the Applicant informing him of the effect his lump sum compensation payment had on his eligibility to receive future income support. As a result of the Applicant receiving, in total, a payment of $70,751.88 Centrelink determined that a preclusion period beginning on 4 June 2015 and ending on 22 June 2016 applied during which time the Applicant would be ineligible to receive income support – Exhibit 1 T10 p.50.
On 18 September 2015 the Applicant sought a review of this decision – Exhibit 1 T17 p.72, however that decision was subsequently upheld by both the Authorised Review Officer (Exhibit 1 T12 p.55) and the Social Services and Child Support Division of this Tribunal (AAT1) – Exhibit 1 T3 p.6.
On 25 May 2016 the Applicant applied to the Tribunal for a review of the decision of AAT1 – Exhibit 1 T2 p.3. The Applicant provided the following grounds for the appeal (Exhibit 1 T2 p.5):
“I am asking for some lennance (sic, lenience) towards getting my payments as I am staying with a friend How (sic, who) is helping me out with somewhere to stay and food to eat as I’ve been on workcover for 10 years.
I have come to QLD to be with my daughter since I have been Here the mother of my Daughter has left the island where I live I have no income I cannot aply (sic, apply) for any work as I don’t have any cards to work If I am able to work due to my back injery (sic, injury) and I have to rely on other people if I need to get off the island and receaveing (sic, receiving) payments would help me get back on my feet so I can get my own home and hopefully return to work.”
The matter was heard over two days: 8 – 9 December 2016. The Applicant was self-represented and participated via conference telephone from Magnetic Island, and Townsville. Unfortunately telephone communications terminated prematurely on 8 December 2016 and the matter resumed on 9 December 2016. The Secretary, Department of Social Services (the Respondent) was represented by Mr Nicholas Warren.
Issues
There are two issues requiring determination by the Tribunal:
(a)Whether the Applicant was subject to a compensation preclusion period, and, if so, for how long; and
(b)Whether there were any special circumstances which would justify disregarding the whole or part of the compensation payment.
Legislation
The Social Security Act 1991 (the Act) contains provisions dealing both where a person, the recipient of social security payments, receives a lump sum compensation payment and secondly where a person who has received a compensation payment subsequently applies for social security.
The Act is focused on either recovery of social security paid, or preventing the payment of social security, during a preclusion period. The principle underpinning these provisions is that “double dipping” should not be allowed, and that a person should not simultaneously obtain the benefit of a compensation payment and a social security pension or allowance.
Parliament has enacted legislation with the additional objective of ensuring that if a person has received a compensation payment for economic loss, such person should draw on those funds for a reasonable period before they can again obtain income support through social security payments.
Subsection 1169(1) of the Act provides that if a person receives a “compensation affected payment” and also receives a lump sum compensation payment, then the compensation affected payment is not payable to the person during the lump sum preclusion period.
The term “compensation affected payment” is defined in s 17(1) of the Act to mean one of a number of enumerated pensions and allowances, including in paragraph (c) “a social security benefit”. Section 23 of the Act provides that ”social security benefit” includes, inter alia, the Newstart Allowance.
Subsection 17(2) of the Act contains an expansive definition of “compensation”, including a payment of damages, a payment under a scheme of insurance or compensation under a State law, a payment in settlement of a claim of damages under such a scheme or any other compensation or damages payment.
The compensation part of a lump sum payment is defined by s 17(3) to be 50% of the payment if it is made in settlement of a claim related, inter alia, to an injury. The 50% rule was designed to avoid manipulation of the system by obscuring the economic loss component of the payout. Parliament therefore deemed 50% to be in respect of economic loss – Secretary, Department of Social Security v Banks (1990) 20 ALD 19 at 24 per von Doussa J.
The calculation of the lump sum compensation preclusion period is made pursuant to section 1170 of the Act. Subsections 1170 (1) – (3) outline three scenarios, but in this matter subsection (3) applies. It provides that in the case of a lump sum simpliciter, the relevant commencement date is the date on which the “loss of earnings or loss of capacity to earn began” and ends at the end of the number of weeks calculated pursuant to subsections (4) and (5).
Subsection (4) provides that the number of weeks in the lump sum preclusion period is calculated by using the formula:
If the number calculated by using the above formula is not a whole number, it is to be rounded down to the nearest whole number – s 1170(5).
Section 1171 deals with those circumstances where a person (as in this case) receives two or more compensation payments in relation to the same event that gave rise to the compensation entitlement. In such a case, the person is deemed to have received a single payment on the date the last payment was received. It is apparent that this was to overcome the situation where there was a compensation settlement in two parts, one containing only economic loss and the other no economic loss. At one stage the 50% deeming rule only applied to the economic loss portion, and the other settlement was excluded from the calculation of the preclusion period. This is no longer the case.
Finally, s 1184K of the Act vests in the Secretary the discretion to treat the whole or part of a lump sum compensation payment as not having been made or not liable to be made if the Secretary thinks it appropriate to do so in the special circumstances of the case.
Consideration
Is the Applicant subject to a compensation preclusion period, and for how long?
In dealing with these questions, the Tribunal has to establish certain propositions.
The first proposition is whether the Applicant received compensation payments as defined by s 17(2) of the Act.
The uncontested evidence is that the Applicant received $32,766.72 in November 2008 for non-economic loss – Exhibit 1 T8 p.42. The disabilities were assessed to be permanent and stable and comprised:
(a)25% loss of function of lower back – $25,440; and
(b)8% loss of function left leg at/above knee – $7326.72.
It is also uncontested that the Applicant received a lump sum compensation payment of $70,751.88 on 26 March 2015 for economic loss.
The sum total of both payments is $103,518.60. I consider that these payments meet the s 17(2) definition for compensation payments for the purposes of the Act.
The second proposition is whether both payments related to the same event that gave rise to the compensation entitlement and so should be both be included in calculating the preclusion period. At AAT1 the Applicant queried whether the 2008 payment should be included in the calculation (Exhibit 1 T3 p.8), but he did not raise this issue at the hearing of 8-9 December 2016. It is abundantly clear that s 1171 applies to these payments and they are to be treated as a single payment from the date the last payment was received – s 1171.
The third proposition is whether Centrelink correctly calculated the preclusion period. In accordance with s 17(3) of the Act, the compensation part of the lump sum payment is 50%, which in this case amounts to $51,759.30. It is this amount which is subject to the formula in s 1170(4) outlined above which is used to calculate the length of the preclusion period.
The Applicant did not contest at the hearing the application of this formula by Centrelink, as upheld by AAT1, namely the period 4 June 2015 to 22 June 2016.
Accordingly, I find that the Applicant was subject to a compensation preclusion period, and that the length of that period as originally calculated by Centrelink was correct.
Are there any special circumstances?
Subsection 1184K of the Act provides that the Secretary may treat the whole or part of a compensation payment as not having been made or not liable to be made if the Secretary thinks it is appropriate to do so in the special circumstances of the case.
There is voluminous jurisprudence on the interpretation of “special circumstances”. One of the most quoted explanations of this phrase was made by the Tribunal (Toohey J presiding) in Beadle and Director-General of Social Security (1984) 6 ALD 1 (at 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 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 unusual run of cases. That is not to say the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.”
Nonetheless, Branson J cautioned against overstating the test by emphasising “exceptional” – Ryde and Secretary, Department of Family and Community Services [2005] FCA 866. Her Honour said (at [26]): “the statutory requirement for ‘special circumstances’ discloses an intention to proscribe waiver in ordinary cases. The hardship or unfairness… must be understood to be hardship or unfairness sufficient to justify departure from the general rule in the particular case.”
Reference can also be made to the following helpful observations of Besanko J in Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25; (2007) 100 ALD 9 at ([33]):
“…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 the case from the ordinary or usual case.”
Finally, I also refer to Groth v Secretary, Department of Social Security (1995) 40 ALD 541 where Kiefel J (as she then was) observed (at 545):
“The phrase “special circumstances”, it has been said, although imprecise is sufficiently understood not to require judicial gloss: Beadle’s case (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 occurred that there must be some feature out of the ordinary.”
Although these cases concern different provisions in the Act, their approach to what constitutes special circumstances applies with equal force to the phrase in s 1184K – Secretary, Department of Social Security v Hulls (1991) 22 ALD 570 at 580-581 per O’Loughlin J.
The Respondent drew the Tribunal’s attention (Secretary’s Statement of Facts & Contentions (SSFC) para 28) to the decision of French J (as he then was) in Secretary, Department of Employment and Workplace Relations v Homewood [2006] FCA 779; (2006) 91 ALD 103. French J said ([34]):
“The decision before the Tribunal in this case arose under s 1184K of the Act. It was necessary to the exercise of the power conferred by that section that the Tribunal identified ‘special circumstances of the case’ in which it thought it ‘appropriate’ to treat the whole or part of the relevant compensation payment as not having been made. In giving its reasons for a decision under that section to treat the whole or part of a compensation payment as not having being made it would be expected, consistently with s 43, that the Tribunal would:
1Identify the circumstances of the case which it found to be ‘special’ and the reasons for which it arrived at that finding.
2Explain why, in the special circumstances so found, it though it appropriate to treat the whole or part of the compensation payment as not having been made.
3Explain why it selected the particular quantum (ie the whole or part) of the compensation payment as not having been made.”
At the time of the hearing, the Applicant was 41 years of age. He has never been married but has seven children aged between 8 and 22 years to four different mothers. His youngest child is a girl, Taleah, and her mother is Ms Rachel Henderson. The Applicant testified that, when he was able, he paid maintenance for three of his children. He has a long history of both working and receiving social security and two short terms of imprisonment (in 1996 and 2003) – Exhibit 1 T17 p.67.
The Applicant was employed at a meatworks in Bordertown South Australia when he was injured at work resulting in damage to his lower back and upper left leg. By the time he received the final economic loss compensation payment in 2015 he was living in Mt Gambier. Of the $70,751 he was paid, the Applicant estimated that he received $40,000. He testified that the remaining $30,750 was exhausted in the payment of legal fees and statutory reimbursements. I note that no such reimbursements were claimed by Centrelink – Exhibit 1 T9 p.49.
The Applicant used part of the remaining compensation payment to purchase a motor vehicle for $5000 (Exhibit 1 T3 p.8) and gave $1000 to three of his children – Exhibit 1 T17 p.72.
The Applicant testified that he was mixing with bad company in Mt Gambier, and in a period of two to four weeks, after receiving his compensation payment, he spent between $20,000 to $30,000 on illicit drugs, mostly “Ice”. He informed the Tribunal that he had been using illicit drugs recreationally prior to this, but once he received the compensation payout he was “out of control”.
It would appear from the Applicant’s testimony that matters quickly spiralled out of control in Mt Gambier, with the rapid exhaustion of the compensation payments, the onset of ill health and his home in Mt Gambier being broken into and his belongings stolen – Exhibit 1 T17 p.72.
The Applicant also testified that he was attacked by an assailant who hit him with a hammer, which resulted in admission to a hospital overnight. However, this assault was said to have occurred in February 2015, before the final compensation payout, but was indicative, according to the Applicant, of the bad company he was associating with.
Realising that he was seriously out of control and had to stop and get help the Applicant contacted Ms Henderson who was, at that time, living at Magnetic Island with Taleah. Ms Henderson agreed that the Applicant could live with them.
The Applicant subsequently moved from Mt Gambier to Magnetic Island in August 2015. By the time he arrived at Magnetic Island, he only had $1000 left from his compensation payout – exhibit 1 T17 p.72. On 18 September the Applicant contacted Centrelink seeking assistance due to hardship - Exhibit 1 T17 p.71. When Centrelink contacted Ms Henderson on 30 September 2015, she confirmed that the Applicant was with her, needed assistance and that she was assisting him, but “needs to be aware of her own boundaries” - Exhibit 1 T17 p.78.
Relations between the Applicant and Ms Henderson were volatile and by October 2015, the Applicant had moved out and was sleeping in his motor vehicle outside Ms Henderson’s house – Exhibit 1 T17 p.75. Ms Henderson’s preparedness to help the Applicant apparently ceased and by then she allegedly refused to give the Applicant any assistance, including food (Exhibit 1 T17 p.75) and he testified that he began catching fish from the ocean to survive.

According to the Applicant, Ms Henderson also had problems with illicit drugs.
It would appear that one reason that Ms Henderson consented to the Applicant living with her was that she was, according to the Applicant, at that time the subject to various criminal charges involving drugs and firearm offences. Ms Henderson’s charges were dealt with in early November 2015 and she received a non-custodial sentence. During this time the Applicant states that he was taking care of Taleah, including ensuring that she went to school. This version of events is partly corroborated by an undated form letter from Mrs Jo Sinclair-Jones, the Principal of Magnetic Island State School. The letter states (Exhibit 1 T16 p.66):
“This is to advise that Damien Gartside has been responsible for [redacted]in attending Magnetic Island State School over the past term.
Damien drops her off and picks her up from school and has been available to come to the school when [redacted] has been unwell.
Damien has advised us that he is now the sole carer of [redacted] at this point in time.
We have developed a positive relationship with Damien and believe that he is doing his best to provide a loving and supportive home environment, but is in need of support.”
The Tribunal also has considered a medical certificate prepared by Dr Mark Loeffler dated 11 November 2015. Dr Loeffler had only seen the Applicant that day, and, as such, did not have a history of treating him. In the section of the report dealing with other medical conditions impacting on the patient’s capacity to work or study, Dr Loeffler stated (Exhibit 1 T14 p.63):
“He has been left with daughter who is 7 years old as main carer, The mother has abandoned the family since the 8^th of November due to alleged ice addiction. She is in Townsville with ex-Boyfriend and doesn’t care at the moment. No food in the house and ongoing bills. Money from recent payout 55 thousand has squandered on Fathers (sic) Ice addiction and pokies. However Father has now abandoned that lifestyle and is looking after his daughter Talleah (single Parent). He feels sorry about loosing (sic) payout and feels remorse.”
The Tribunal also considered a Centrelink report dated 17 November 2015 (Exhibit 2). The Applicant lodged a FA100 form that Taleah was in his care from 8 November 2015, together with supporting documentation from Magnetic Island State School. In all likelihood, it was the document outlined above. On 16 November 2015, the application was processed without having the benefit of a response from Ms Henderson. On that same day, Ms Henderson provided evidence that Taleah was not permanently in the Applicant’s care and requested a review of the decision. The next day a decision was made to cancel the Applicant’s Family Tax Benefit; as no money has been paid there was no debt created.
The Applicant testified that Ms Henderson removed Taleah from his care before Christmas 2015. From approximately February 2016, the Applicant began living with a man suffering from kidney failure. The Applicant testified that he is given free board, sleeps on the couch and paid a small amount for assistance around the home and some personal care for the homeowner.
The Respondent contends (SSFC para 31) that there are no circumstances that would justify the exercise of the discretion to disregard the whole or part of the compensation payment. In so contending, the Respondent raises a number of factors which it is contended weigh strongly against exercising the discretion.
Notice of the Preclusion Period
The Respondent contends that Centrelink properly notified the Applicant of its decision to impose the compensation preclusion period and the beginning and conclusion dates of that period. The notice given to the Applicant importantly states in the second paragraph (Exhibit 1 T10 p.50): “During this period you are not able to receive income support from us.”
The failure of the relevant government agency to notify a person of the preclusion period, or a delay in providing such advice or the provision of incorrect advice may result in a finding of “special circumstances”, e.g. Re Secretary, Department of Social Security and Gardiner [1991] AATA 112 and Bell and Secretary, Department of Social Security [1998] AATA 284.
On the evidence before the Tribunal no case can be made that Centrelink failed in any respect to fulfil its duties towards the Applicant. He was appropriately notified of the operation of the preclusion period, its length and the social security consequences that flowed therefrom.
Financial Hardship
The Respondent contends that ‘financial hardship’ must go beyond ‘straitened’ circumstances and be truly exceptional to be considered special. Further, the Respondent contends that there is no corroborating evidence that the Applicant fully expended the balance of his compensation funds by September 2015. In the absence of such evidence, the Respondent contends that the Applicant’s self-serving statements hold little weight.
I do not understand the many Federal Court and Tribunal decisions on “special circumstances” to require the Tribunal to find that special circumstances exist simply because the Applicant is in straitened financial circumstances. My understanding of the law is that it is open for the Tribunal to find special circumstances in such a circumstance, but a Tribunal Member is not obliged to do so. In exercising the discretion vested in the Tribunal, a Member is required to consider all of the matters the evidence admitted produces and straitened financial circumstances is one factor, albeit a very important one, but not the sole one. As Sheppard J said in Director General of Social Services v Hales (1983) 47 ALR 281 at 321:
“The legislation provides for the payment of a variety of benefits to different classes of people who will usually have one thing in common; they will be impecunious and in straitened circumstances. Very often their stories will be quite tragic.”
Other factors which may outweigh straitened financial circumstances include consideration of the general administration of the social security system (Re Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114) and whether an Applicant’s disposition of their compensation payment has been reckless – e.g. Davis and Secretary, Department of Family and Community Services [1999] AATA 84.
In this matter, with respect, I disagree with the contentions of the Respondent. The preponderance of evidence, albeit mostly circumstantial, leads to the conclusion that the Applicant engaged in a drug fuelled episode after receiving his compensation payout and basically threw away the vast bulk of his payout. The evidence also suggests that by the time he moved from South Australia to Queensland, he was financially impecunious and, with the exception of his motor vehicle, had few assets and only $1000 remaining of cash.
Accordingly, I accept that by September 2015, the Applicant was in straitened financial circumstances.
Conduct and Health of the Applicant
The Respondent contends that if it is accepted that the Applicant spent the bulk of his compensation payout on illicit drugs, this should militate against a finding of special circumstances. It is contended that there is no evidence that the Applicant was, at the time, a drug addict nor suffered from a diagnosed medical condition which would have explained his behaviour. Rather, the Respondent contends, the evidence suggests the Applicant was grossly irresponsible and this is a factor weighing strongly against the exercise of the discretion.
The evidence before the Tribunal does not establish that the Applicant was addicted to illicit drugs when he received the compensation payout. The Applicant freely admitted that he was a long term recreational user of illicit substances and that he was associating with a “bad crowd”. The preponderance of evidence is that while the Applicant has been a long term user of illicit drugs, he was not, and is not, an addict as that term is commonly understood.
Nor is there evidence that the Applicant’s drug binge was caused by either psychological imbalance and/or social and intellectual disadvantage. The sheer profligacy and recklessness of the Applicant may owe something to underlying psychological conditions, or it could be attributed to stupidity and a total disregard of societal norms and good behaviour by a person who was fixated by immediate self-gratification. Although it is unclear what the fundamental cause of the binge was, there is certainly no medical evidence before the Tribunal that could offer a clinical explanation for what occurred and provide a basis for the exercise of the discretion – Secretary, Department of Social Security and Thompson [1993] AATA 641.
The only medical evidence before the Tribunal is a medical certificate from Dr Loeffler who prepared the document on the basis of his first consultation. Dr Loeffler stated that the Applicant was suffering from depression and had been treated for this condition in Mt Gambier by Dr Tish Cavanagh – Exhibit 1 T14 p.63. Whilst the Applicant may have a longstanding depressive condition, there is no suggestion that this condition contributed in whole or part to his behaviour after the compensation payout.
I also agree with the Respondent that it is not unusual or out of the ordinary for a person who has received compensation for a compensable injury to have ongoing health issues, including depression. There is no evidence before the Tribunal to suggest that the Applicant was suffering from serious depression or serious ill health.
There have been a number of Tribunal decisions that have dealt with persons who have squandered their compensation payments on drugs, alcohol and gambling. One decision of particular relevance to this matter is Davis and Secretary, Department of Family and Community Services [1999] AATA 84. That was a matter involving a person who had been “grossly irresponsible” and spent his compensation payout on smoking, drinking and gambling. The Tribunal said:
45 For most of his adult life the Applicant has been supported in a supplementary way by his sister, and his chronic smoking, drinking and gambling habits have cost her dearly. Even when he was in full-time employment he was not always paying board to her. His dependence on her increased significantly after he ceased work following his back injury, as his smoking, drinking and gambling habits increased. His spending on smoking, drinking and gambling apparently increased further since May 1997, and until all the money was gone. There is no evidence of addiction, and this behaviour can only be described as grossly irresponsible.
46 If the circumstances were different, and the Applicant had saved the money and carefully and safely invested it, then in addition to his house he would have had sufficient money to tide him over at a reasonable standard of living until the completion of the preclusion period. If the preclusion period is shortened or waived because of his reckless spending then that would be an invitation to others in similar circumstances to do likewise and then become dependent on the public purse. One could anticipate the public outcry, and reasonably so.
I find on the evidence before the Tribunal, that the Applicant’s conduct was grossly irresponsible and reckless. Clearly the Applicant was remorseful after the event, but that does not explain or excuse what transpired. Further, there is no medical and circumstantial basis for explaining away what occurred. Accordingly, the conduct of the Applicant in the period between his payout and August 2015 militates against an exercise of the discretion.
Other Factors
The special circumstances discretion is broad and the factors that could enliven or militate against its exercise are almost limitless. Moreover, the various combination of factors which are necessarily unique to each case, further arithmetically increase the possible scenarios and outcomes that are possible. Time and time again, the Federal Court has highlighted that it is not possible or sensible to attempt to enunciate legal principles that could “box in” or constrain the appropriate exercise of this discretion.
Consequently, in this case there are some other factors or matters that I have considered.
First, reference can be made to the following observation of French J in Homewood ([44]):
“There may, for example, be circumstances in which a person in receipt of a compensation payment has also subsequently acquired obligations to support a close relative which places an ongoing drain on his or her resources.”
French J made those comments in the context of a situation where not all of the compensation payment has been dissipated, but, nonetheless, his Honour raises an important principle. If a person, the subject of a preclusion period, becomes responsible for additional family responsibilities, which responsibilities may not be able to be discharged without a favourable exercise of the discretion, then this is a factor to be considered.
In this matter, the Applicant took over the responsibility for caring for his youngest daughter for a short period in late 2015. If this situation had persisted, then it would have been a factor that could and should have been taken into consideration and would have weighed in his favour. However, the evidence suggests that while the Applicant sincerely and appropriately performed his fatherly duties, the intervention of Ms Henderson in late 2015 terminated that arrangement.
The Respondent drew the attention of the Tribunal to the fact that since, approximately, February 2016 the Applicant has been living with a person who provides him with accommodation, some food and board in return for personal assistance. The Applicant confirmed this arrangement when giving evidence at the hearing.
I agree with the Respondent that since February 2016, at least, the Applicant has been living in secure and reasonable accommodation and has been receiving financial and other support.
Finally, the Respondent drew the Tribunal’s attention to the fact that from the date the preclusion period ended, the Applicant has been in receipt of the Newstart Allowance. The Respondent, correctly, concedes that the fact that the preclusion period has concluded by the date of the hearing is irrelevant and the Tribunal would err in law if it considered such a factor – Haidar v Secretary, Department of Social Security [1998] FCA 994; 52 ALD 255.
However, the Respondent contends it is relevant to consider whether the Applicant was able to support himself throughout the balance of the compensation preclusion period.
The fact that the Applicant is now receiving a Newstart Allowance is an irrelevant consideration. The court in Haidar determined not only that the expiration of the preclusion period was irrelevant but also that any improvement in an Applicant’s position after the preclusion period was also of no significance and a Tribunal Member would err by placing any weight on such a factor.
Nonetheless, the thrust of the Respondent’s contention does have weight. It is appropriate for the Tribunal to consider whether the Applicant, though suffering hardship during the preclusion period, was able to adequately support himself. The evidence before the Tribunal is that the Applicant was able to support himself throughout the preclusion period.
Conclusion
The exercise of the special circumstances discretion involves the weighing of various and sometimes competing factors. In this matter, the factors weighing against the exercise of the discretion conclusively outweigh those in favour of its exercise.
The Applicant’s behaviour was rash and irresponsible, he engaged in the use of illegal substances, he squandered his compensation payment on himself with little consideration for his family. On the other hand, he was not suffering from any medical condition that would explain or excuse this conduct. The Applicant obviously has been suffering from such ailments, and has been treated for depression. But his state of health was no worse than would be expected of a man of his age and with the compensable injuries he suffered.
In his favour is the fact that he was in straitened financial circumstances, and, at times, living in squalid conditions. Irrespective of a person’s reckless and irresponsible behaviour, the Tribunal has previously favourably exercised this discretion if the alternative is that a person would be destitute and living on the streets – O’Neill and Secretary, Department of Education, Employment and Workplace Relations [2009] AATA 619 at [46] per Senior Member Isenberg. It would be counter to the fundamental principles underpinning our social security system if a person was automatically relegated to begging for charity on the basis of previous reckless behaviour.
In this matter, however, the Applicant did receive assistance, albeit, transitory, from his ex partner, Ms Henderson, and he has received other assistance since then. Since February 2016 he has been living in apparently reasonable accommodation. Further, it would appear that he has been receiving medical assistance. I agree with the Respondent that although his lifestyle during the preclusion period was difficult, and he experienced hard times, he nonetheless managed reasonably well and was not in the dire circumstances of Mr O’Neill in the determination outlined above.
I have therefore concluded that the Applicant’s circumstances were not sufficiently special so as to enliven the exercise of the discretion conferred by s 1184K of the Act in his favour.
Decision
The decision under review is affirmed.

I certify that the preceding 84 (eighty -four) paragraphs are a true copy of the reasons for the decision herein of Senior Member J Sosso

...............................[Sgd].........................................
Associate
Dated: 20 January 2017

Dates of hearing: 8 and 9 December 2016

Applicant: In person

Solicitors for the Respondent: Department of Human Services

Dates of hearing:	8 and 9 December 2016
Applicant:	In person
Solicitors for the Respondent:	Department of Human Services