Griffis; Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and

[2009] AATA 596

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 596

ADMINISTRATIVE APPEALS TRIBUNAL      )   

)    No: 2008/0260

GENERAL ADMINISTRATIVE DIVISION        )   

ReSecretary, Department of Families, Housing, Community Services and Indigenous Affairs

Applicant

And    Cherisse GRIFFIS

Respondent

DECISION

TribunalMs N Isenberg, Senior Member

Date13 August 2009

PlaceSydney

DecisionThe decision of the Social Security Appeals Tribunal is set aside.

....................[sgd]..........................

Ms N Isenberg
  Senior Member

CATCHWORDS

SOCIAL SECURITY –Social Security Appeals Tribunal set aside decision made by an Authorised Review Officer to uphold a primary decision made by Centrelink to cancel Respondent’s disability support pension because the combined income of the Respondent and her partner had exceeded the ‘allowable limit’ – whether special circumstances exist to justify the exercise of the discretion under s 1184K to disregard an amount of the Respondent’s husband’s periodic compensation payments as not having been made, to permit the Respondent’s disability support pension to be restored –  No special circumstances found to exist – financial situation of Respondent not unusual – section 1184k discretion should not be exercised -  Decision of SSAT set aside.

RELEVANT ACT:

Social Security Act 1991: sections 1184K, 1184K(1), 1173(1), 1173(2), 1174, 1061ZA(1)

CITATIONS

Beadle v Director-General of Social Security (1985) 7 ALD 670

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

Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25

Groth v Secretary, Department of Social Security (1995) 40 ALD 541

Re Krzywak v Secretary, Department of Social Security (1988) 15 ALD 690

Secretary, Department of Social Security v Ellis (1997) 24 AAR 535

Director-General of Social Services v Hales (1982) 47 ALR 281

Colin McAliney & Secretary, Department of Family and Community Services [2005] AATA 96

Re Secretary, Department of Social Security v Bolton (1989) 18 ALD 464

REASONS FOR DECISION

13 August 2009	Ms N Isenberg, Senior Member
decision under review

1.      A decision made by the Social Security Appeals Tribunal (“SSAT”) on 3 January 2008, to set aside a decision to cancel the Respondent's disability support pension (“DSP”) and, instead, decide that so much of Mr Griffis' weekly compensation be disregarded so as to restore Mrs Griffis' DSP to the rate at which it was being paid at the date of its cancellation.

background

2.      Since 2000, Mrs Griffis has suffered from the very debilitating effects of bacterial meningococcal septicaemia and as a result suffers from numerous serious and extensive medical conditions.  In July 2002, she was granted DSP.

3.      Mr Griffis is being paid weekly compensation as a result of a workplace injury and has not worked for some years.  When his payments were increased to $927.63 in October 2007 Centrelink decided to cancel Mrs Griffis’ DSP because the Griffis’ combined income was above the allowable limit.  That decision was affirmed on internal review.

4.      The SSAT however considered that it was bound to take a “global view” of Mrs Griffis’ circumstances and, in finding that special circumstances were present, took into account:

§The serious, extensive and progressive nature of her medical condition;

§That her condition arose after her husband had been medically retired from his work and could not have been anticipated;

§That she and her husband live in an area not well served by medical facilities and that they must take frequent trips to gain relevant treatment;

§That Mr Griffis’ ability to care for his wife has been reduced by his own deteriorating health, he having suffered after a heart attack and suffers from mood disorders with depression;

§That she and her husband have little other family help; and

§That Mr and Mrs Griffis have medical expenses of $600 per month and the effect of the cancellation of Mrs Griffis’ DSP was to also disentitle her to a pensioner concession card.

5.      At the time of cancellation of her DSP Mrs Griffis was receiving about $49 per fortnight.

issue before the tribunal

6. Whether the discretion in section 1184K Social Security Act 1991 (“the Act”) should be exercised, so that an amount of Mr Griffis' periodic compensation payments can be disregarded as would permit Mrs Griffis' DSP to be paid at the rate that it was being paid when it was cancelled on 29 October 2007?

legislation

7. A person’s DSP is affected by compensation payments made to his or her partner: subsections 1173(1) and (2) and, section 1174 of the Act. A person, such as Mrs Griffis, who receives DSP, is affected by her partner's compensation payment as if it were ordinary income.

8.      A person who receives a social security pension such as DSP, will generally qualify on that basis alone for a pensioner concession card: subsection 1061ZA(1).  In limited circumstances, a former recipient of DSP may continue to receive a pensioner concession card.  Those circumstances do not include the situation where a person loses qualification for a pensioner concession card because a DSP is no longer payable due to the effect of their partner's periodic compensation payment on the rate of DSP.

9. Pursuant to subsection 1184K(1) of the Act, part or whole of Mr Griffis’ compensation payment may be treated as not having been made if I think it is appropriate to do so and I find there are special circumstances.

the evidence

10.     l had before me documents lodged pursuant to section 37 of the Administrative Appeals Tribunals Act 1975 (“the T-documents”), which I took into evidence.  A statement was also received from the Respondent, Ms Cherise Griffis.

11.     Both Mr and Mrs Griffis gave evidence, as did their GP, Dr Habashy.

12.     Mrs Griffis told me that she had worked up until the birth of her children and had undertaken some part time work when they were young.  During that time, she contributed financially to the household and was able to provide some minor financial assistance to her father.

13.     When her younger child started high school, in about 1989, she started fulltime work as a cleaner.

14.     Notwithstanding earning her own income, throughout her marriage her husband had given her an “allowance” from which she was to pay for food and clothes.  He attended to the bills.  That arrangement continued after she became ill and could no longer work.

15.     When she received the DSP, she had a degree of financial independence in that she could purchase items for her personal care and small gifts for the grandchildren.  Currently, her husband gives her no allowance and they shop together, and he pays for everything with his recently acquired credit card.  If she needs money, such as for a haircut, she has asked her husband but sometimes “he can’t give it”.  She shops as inexpensively as she can, but does not compromise on the quality of food.  Her children have their own responsibilities and are unable to help.  She has a kind aunty who occasionally might give her a very small amount of money.  While ever she continues to receive even some small amount of DSP, she retains, it was submitted, a degree of dignity.

16.     Mrs Griffis said she had always been energetic, social and active and a keen sportswoman, whereas now she has severe physical limitations and is disinterested in socializing or doing anything at all.  The beginning of her illness was dramatic and intense and continued to be severe for at least two years.  Dr Habashy regarded it as “a miracle” that she recovered at all.  Nine years later, she remains in continual pain and frequently needs hospitalisation.  All her organs are affected and she has dental problems, and bowel and bladder problems.  The latter especially preclude long travel.  Her brain has been affected and she has had a personality change and memory problems.  She sees her GP once a week.  Her prognosis is poor.  She has been diagnosed with depression and she has attempted suicide.

17.     Mrs Griffis said she and her husband had a “fabulous” relationship until, in 1995, he became abusive because of work stress, and she left him briefly.  Their relationship was satisfactory until she became ill in 2000.  She has become very short tempered.  She needs operations on her stomach, knees, leg, foot, toenails, eyes, and breast but her husband is reluctant to allow her to make all the medical appointments on the basis of expense.  Her husband has threatened to leave the health fund, the annual fee for which is $4,000, but she has insisted on its retention because of the high level of continuing medical expenses.

18.     Mr Griffis expressed concern at their living expenses.  He has “borrowed” $60,000 or $70,000 from his superannuation for their living expenses and is “paying it back” at $50 per week from his credit union account, presumably the account into which his compensation payments are made.  He is concerned that what remains of his $200,000 nest egg, set aside for their old age, will be unlikely to finance them in future years: “You can’t live on the (age) pension”.  Mrs Griffis takes the view that they will not be living long enough to need all the money in the fund.

19.     When they bought their house, which is 100 years old, in about 1988 it was partially renovated.  With Mr Griffis’ redundancy payments, they paid off the mortgage.  The house is unencumbered, but is in need of repair, eg, the steps at the rear need replacement and both Mr and Mrs Griffis have fallen on them.  Mrs Griffis’ frequent use of the toilet has put a strain on the septic system and it will have to be replaced.  She needs impeccable hygiene and there is no hot water, from what I understand from the evidence, to use as a douche or bidet.

20.     Mr Griffis said he used to be a keen sportsman but is limited now by his medical problems: his back, both shoulders, his carpel tunnel and his heart condition.  He has had night-time breathing problems investigated and his blood pressure is high.  He goes into his shed and drinks, and Dr Habashy said he was alcohol dependent.  Dr Habashy also referred to Mr Griffis’ depression and marital disharmony.  He has no social life either now.  A number of times in his evidence, he expressed disappointment at lost travel opportunities because of Mrs Griffis’ condition.

21.     In his statement, Mr Griffis said they had discussed separating on a number of occasions but thought that for financial reasons they were better off continuing to live together.  He said that he had tried his best to look after his wife but thought the time was coming when she would need a full-time carer but did not know if he would be able to do it because of his own condition.  Ironically, if Mrs Griffis were to leave her husband, thereby preserving her entitlement to DSP, the only place she could think to go was to a relative of his.

22.     Centrelink did not dispute that Mr and Mrs Griffis have significant medical expenses.  Evidence was provided of Mr and Mrs Griffis’ pharmaceutical purchases from their usual pharmacy between 1 January 2006 and 29 January 2009: Mrs Griffis’ actual payments for the period totalled less than $300 and Mr Griffis’ totalled less than $600, the majority of which was in recent years.  In contrast, in November 2007 Mr Griffis told Centrelink that their pharmaceutical expenses were about $500 per month.  In May 2008, Mr Griffis told Centrelink that their prescription medicines were costing $350 per month, and Mrs Griffis told the SSAT that at that time her medical expenses were $600 per month.  At the hearing, Mr Griffis conceded that the estimate of $350 per month was on the basis of the full cost of prescriptions, not the actual cost to them using the pensioner concession card.  Centrelink conceded that without the benefit of a pensioner concession card, the cost of the medications would be much higher.

23.     The car used by Mr and Mrs Griffis is increasingly unreliable and will require replacement in the near future.

consideration

24. The Act provides no guidance as to the meaning of the term “special circumstances”, other than that the s1184K discretion is not available if the only “special circumstances” are financial hardship; there must be special circumstances other than that make it desirable to waive the debt. In Beadle v Director-General of Social Security (1985) 7 ALD 670, the Full Federal Court stated that it was not possible to lay down precise limits or precise rules for the meaning of the term. The Court indicated that this would depend upon the circumstances of each particular case but commented that, even though the term lacks precision, it was sufficiently understood “not to require judicial gloss” (at [674]). There, the Court affirmed the decision of the Tribunal (Re Beadle and Director-General of Social Security (1984) 6 ALD 1) where (at [3]) the Tribunal had acknowledged that the term was “incapable of precise or exhaustive definition” and that, to be special, the circumstances “must have a particular quality of unusualness that permits them to be described as special”. See also Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25 per Besanko J at [33].

25.     In Groth v Secretary, Department of Social Security (1995) 40 ALD 541, Kiefel J, after referring to the Federal Court's decision in Beadle’s case, observed (at 545) that special circumstances:

… would require something to distinguish... [the] … 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.

….

26.     On the basis of the “statement of financial circumstances” completed by the Mr and Mrs Griffis on 6 May 2008 there is a surplus of $91.61 a fortnight based on the information provided.  The calculation also includes the $350 per fortnight for prescription medicine, which was shown to be, at the time, an excessive estimate.

27.     Mr Griffis receives a weekly compensation payment of $927.63 gross.  They own their own home and it is unencumbered but is in need of some repair.  Mr Griffis has $170,000 in his superannuation fund.  While entirely understandable that they should want to retain home ownership and superannuation funds, it cannot be said that there is unusual financial pressure.  The discretion is often not attracted in those circumstances: see, for example, Re Krzywak v Secretary, Department of Social Security (1988) 15 ALD 690 at 699-700; Secretary, Department of Social Security v Ellis (1997) 24 AAR 535 at 539-540 per Carr J.

28.     I find that Mr and Mrs Griffis’ financial circumstances do not demonstrate a financial burden that is unusual relative to other recipients of social security.  Recipients of social security payments will usually have one thing in common: that is, that they will be in impecunious and in straitened circumstances: Director-General of Social Services v Hales (1982) 47 ALR 281.

29. Centrelink contended that to use the section 1184K discretion to enable qualification for the pensioner concession card was against the intention of the legislature. I was referred to Colin McAliney & Secretary, Department of Family and Community Services [2005] AATA 96, where SM Kelly dealt with an application that the section 1184K discretion be exercised so that the applicant would be entitled to a fortnightly pension of $1 so that he could retain a pensioner concession card. Senior Member Kelly considered the consequences suffered by the applicant to be a clear consequence of the legislation and declined to find special circumstances. I agree with that approach. It is contended that the result is within the intention of the legislative scheme.

30.     There is no doubt that Mrs Griffis suffers from serious, extensive and progressive medical conditions, sufficient to qualify her for DSP.  Against this are substantial family assets, including a realisable property: Re Secretary, Department of Social Security v Bolton (1989) 18 ALD 464 at 466.

31.     Even though the amount of DSP being paid to Mrs Griffis before the cancellation decision was, apparently, less than $50 per fortnight, that entitlement was sufficient to give Mrs Griffis access to a pensioner concession card.  The loss of entitlement to the small DSP payment was perhaps marginal, the loss of the pensioner concession card is likely to have more impact on their financial position.  Information was provided as to the full cost of some medication, which, when cross-referenced to the cost with a pensioner concession card, showed, unsurprisingly, a significant increase.  Presumably, some could be recovered from the health fund, and possibly even Mr Griffis’ workers compensation insurer.

32.     Each matter is different.  In this matter, I agree that Mrs Griffis’ circumstances are difficult, especially as she has no financial independence, but they are not so special, in my view, so as to attract the discretion.  I accept that she is, notwithstanding her (small) DSP, already experiencing a loss of dignity and that this may increase when she no longer even has that.  However, her domestic financial situation is one experienced in many families where there is only one ‘wage earner’.  The legislature assumes, perhaps naively, that each member of a couple will have full access to family assets, especially in circumstances where those assets are used in the calculation of entitlement to Centrelink benefits.  Nonetheless, Mr Griffis provides for the couple though a weekly (compensation) income of over $900, and, at their ages, his superannuation can be accessed.  It is not for me to comment on the arrangements between Mr and Mrs Griffis.  Neither should the taxpayer be asked to address the loss of dignity because it ensues from those arrangements, and not from any unfairness as a result of the application of the legislation.

33.     Mr and Mrs Griffis appear to have both been outgoing and vibrant people who are finding their ill health not only debilitating but also confronting.  They also appear to have had a long and reasonably happy marriage, now under threat by their restricted lifestyle and financial concerns.

34.     I was informed at the hearing that Centrelink has continued to pay Mrs Griffis the small amount of DSP pending the outcome of this hearing.  The effect of this decision will result in a debt to Centrelink, possibly in the order of $2500.  I recommend that consideration be given to waiving the debt.

decision

35.     The decision of the SSAT is set aside.

I certify that the 35 preceding paragraphs are a true copy of the reasons for the decision herein of Ms N Isenberg, Senior Member.

Signed:................[sgd]............................................................
           Renee Wallace, Associate

Date/s of Hearing:  16 June 2009
Date of Decision:  13 August 2009

Applicant representative:                    Mr James Larcombe, Centrelink Legal Services

Respondent counsel:  Ms Maeve McCarthy, Chalfont Chambers