Hanna v Secretary, Department of Social Services
[2023] FCA 1255
•19 October 2023
FEDERAL COURT OF AUSTRALIA
Hanna v Secretary, Department of Social Services [2023] FCA 1255
Appeal from: Hanna v Secretary, Department of Social Services [2022] AATA 3772 File number(s): NSD 1090 of 2022 Judgment of: JACKMAN J Date of judgment: 19 October 2023 Catchwords: ADMINISTRATIVE LAW – appeal from second level decision of the Administrative Appeals Tribunal (AAT2) – where the AAT2 made findings in relation to the applicant’s liability for overpayment of an age pension and the applicable pension rate – where the appeal does not disclose any question of law – whether the AAT2 had jurisdiction – appeal dismissed Legislation: Administrative Appeals Tribunal Act 1975 (Cth) ss 25, 43, 44
Social Security Act 1947 (Cth)
Social Security Act 1991 (Cth) ss 8, 1064, 1223, 1237A, 1237AAD
Social Security (Administration) Act 1999 (Cth) ss 68, 72, 179
Federal Court Rules 2011 (Cth) rr 1.34, 4.01, 33.12
Cases cited: Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135
Hanna v Secretary, Department of Social Services [2022] AATA 3772
Haritos v Federal Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315
Waterford v Commonwealth (1987) 163 CLR 54
Division: General Division Registry: New South Wales National Practice Area: Administrative and Constitutional Law and Human Rights Number of paragraphs: 23 Date of hearing: 17 October 2023 Appearance for the Applicant: Mr F Hanna appeared with leave on behalf of the Applicant Solicitor for the First Respondent: Dr S Thompson of Sparke Helmore Lawyers ORDERS
NSD 1090 of 2022 BETWEEN: ANNE FRANCOISE ADRIENNE HANNA
Applicant
AND: SECRETARY, DEPARTMENT OF SOCIAL SERVICES
First Respondent
ADMINISTRATIVE APPEALS TRIBUNAL
Second Respondent
ORDER MADE BY:
JACKMAN J
DATE OF ORDER:
19 OCTOBER 2023
THE COURT ORDERS THAT:
1.The appeal be dismissed.
2.The applicant pay the respondents’ costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
JACKMAN J
This is an appeal brought pursuant to s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) from a second level decision (AAT2) of the Administrative Appeals Tribunal (AAT) made on 9 November 2022. The decision and reasons under appeal may be found at Hanna v Secretary, Department of Social Services [2022] AATA 3772.
The reasons of AAT2
Mrs Hanna brought two proceedings before the AAT, referred to as the debt matter and the pension rate matter. The debt matter concerned an age pension (AP) debt that the first respondent claims Mrs Hanna owes because she did not disclose the income she was receiving from working during the period 21 April 2018 to 14 December 2018 (the Debt Period), and was in an amount of $14,905.54: [2]. Mrs Hanna applied for review of that decision to an Authorised Review Officer (ARO), but was unsuccessful: [3]. She then applied to the Social Services and Child Support Division of the AAT (AAT1) which decided on 2 March 2020 to set aside the decision and remit the matter for reconsideration, with the direction that Mrs Hanna’s entitlement to AP for the period 21 April 2018 to 14 December 2018 be recalculated: [3]. The debt was recalculated to be $14,822.86: [4].
The reviewable decision in the pension rate matter was made by AAT1 on 25 May 2020, affirming a decision made by an ARO (which affirmed a decision made on 13 April 2018) to pay the applicant $1,792.91 in AP back payment for the period 21 November 2017 to 23 March 2018: [5]. The decision-maker of AAT2 referred to the rate of AP being calculated in accordance with s 1064 of the Social Security Act 1991 (Cth) (the Act), and being affected by a person’s income as defined in s 8 of the Act as an amount earned, derived or received by the person for the person’s own use or benefit: [9]. Section 1223(1) of the Act states that an overpayment of a social security payment is a debt to the Commonwealth: [10]. Section 1237A of the Act relevantly requires waiver of 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 the payment or payments in good faith, and the debt was not raised within a period of six weeks from the first payment that caused the debt or, where a person has complied with a notification obligation, the debt was not raised within a period of six weeks from the end of the notification period: [11]. Section 1237AAD of the Act provides that the Secretary may waive the right to recover all or part of a debt if satisfied that the debt did not result wholly or partly from the debtor or another person knowingly making a false statement or representation or failing or omitting to comply with the Social Security (Administration) Act 1999 (Cth) (the Administration Act) or the Social Security Act 1947 (Cth). Sections 68 and 72 of the Administration Act require a person to inform Centrelink about any changes to their circumstances within 14 days: [13].
On 13 April 2018, Mrs Hanna was granted AP at the single rate, and the Department of Social Services (the Department) sent her a letter advising her that her AP had been granted from 21 November 2017, advised her that she would be paid $1,792.91 as back payment from 21 November 2017 to 23 March 2018, and set out the information used for calculating her regular payment, being annual income of $120.97 and her regular fortnightly earnings of $2,799.55: [14]. The letter also notified Mrs Hanna of her statutory obligations to tell the Department within 14 days if any of the listed changes happened or were likely to happen, including changes to her gross income and, within seven days, whether she will receive, has received, or is likely to receive compensation: [15]. On the same day, Mrs Hanna was sent a reporting statement which said that she must report every two weeks for each reporting period on the dates set out, and once her reporting requirements had been met then her payment would be issued for each reporting period: [16]. The letter specified fortnightly reporting dates from 20 April 2018 to 29 June 2018, and set out what had to be reported for each Centrelink reporting period: [17]. The changes in circumstances information on the back of the page included the requirement to tell Centrelink of any change on the reporting day immediately after the change and said that if Centrelink was not told about the changes then Mrs Hanna could have a debt and may have to pay all or some of the money back: [18]. The list of circumstances included “employment income” and “any money from any source”: [18]. Another letter of the same date to Mrs Hanna requested information about her living arrangements so a decision could be made as to whether she was living as a member of a couple, and a further letter advised Mrs Hanna that she may be entitled to a Belgian pension and should claim for it: [19]-[20].
Mrs Hanna did not make her fortnightly report on 20 April 2018 as she was required to: [21]. On 24 April 2018, the Department sent her a letter setting out her regular payment from 8 May 2018, and gave detailed guidance as to what information had to be provided to the Department and timeframes for doing so, including in relation to “income”: [22].
On 30 April 2018, Mrs Hanna attended a Centrelink office “regarding Change in Earnings Details for Age Pension” to report for the period 7 to 20 April 2018 (20 April being the day before the Debt Period began), but Mrs Hanna was found by the decision-maker to have reported no change in her circumstances, who also found that there were earnings to declare for that period: [23]. The decision-maker said that it seems from the account given before her and from undated documents which were tendered that Mrs Hanna attended in person because she had tried to complete the overdue information using the computer system, which advised her that her “current circumstances don’t allow you to use this service to report your details. Visit our nearest Customer Service Centre or contact us to arrange for your details to be reviewed”: [24]. Also on 30 April 2018, the Department wrote to Mrs Hanna advising her that “As your circumstances have changed, you are no longer required to report every two weeks to get paid unless you start working again. If you start working again you must notify us within 14 days”: [25]. The letter enclosed a form listing the changes that she had to report and stated in bold that if she did not tell the Department about any changes, she could have a debt and may have to pay all or some of the money back: [25]-[26].
On 1 May 2018, Mrs Hanna lodged a statement complaining about the decision made on 13 April 2018 to pay her back payment of $1,792.91 for the period 21 November 2017 to 23 March 2018, arguing that she was managing a company and the fortnightly reporting was inappropriate because her income and losses could only be seen when she lodged a tax return: [27]. On 10 May 2018, Mrs Hanna applied for a Belgian pension, and answered “No” to the question “Have you stopped all your employment activities”: [28]. On 17 June 2018, Mr and Mrs Hanna departed Australia together and returned on 5 July 2018. In addition to the letters already referred to, the Department sent letters to Mrs Hanna on 6 July 2018, 21 August 2018 and 11 September 2018 advising her to notify the Department within 14 days if she started work or her income increased: [30].
The decision-maker said that there was no documentary evidence supporting Mrs Hanna’s claim that she reported her income to the Department “by computer” each fortnight during the Debt Period: [31]. On 30 December 2018, Mrs Hanna did lodge payslips dated from 10 October 2018 to 19 December 2018, which set out her pay from 24 September 2018 to 16 December 2018, and she also lodged her income tax return for the year ended 30 June 2018, which disclosed her income earned from her employment as a nurse and income earned and expenses incurred as a “sole trader” in a business of book publishing: [31]. The ABN records show that the business was registered to the Trustee for the Publishing Group Trust, being a discretionary trading trust, which had been active since 2006, and its source of income being “trading activities”: [32].
On 10 June 2019, Mrs Hanna made a statement which included that she had been paid a Belgian pension of $6,253.59 for the period from July 2017 to April 2019 and $632.76 for May 2019 “including holiday pay”, that she was working two nights per week as a registered nurse and that she had a proprietary limited company: [33].
On 10 September 2019, the respondent issued the notice to the effect that Mrs Hanna owed a debt of $14,905.54 for the period 21 April 2018 to 14 December 2018: [34].
In the debt matter, the decision-maker of AAT1 said that Mrs Hanna was adamant that she reported her earnings to Centrelink from her employment as a nurse by computer each fortnight in the period 21 April 2018 to 14 December 2018, and recorded that Mrs Hanna said that she understood that she could not offset the losses incurred in the business against her income earned as a nurse: [35]. In the pension rate decision, the decision-maker of AAT1 recorded that Mrs Hanna said that the monthly payment of her Belgian pension was $290 to $310, back dated to 3 June 2017; in April 2019 she received a back payment of $6,253.59 for the period July 2017 to April 2019; a compensation payment from NRMA Insurance was deposited into her bank account and used to pay various expenses; and she claimed that her business expenses should have been taken into account: [36]. On 18 July 2020, Mrs Hanna signed and lodged a claim form for Carer Payment and Carer Allowance with respect to her husband, indicating that she had never claimed or received compensation or damages due to personal injury or accident, and declared the contents of the form to be true and correct: [37].
The decision-maker in AAT2 then turned to the debt matter, and said that the fundamental question was whether Mrs Hanna was liable for an overpayment of AP during the debt period: [38]. The decision-maker dealt first with the question whether Mrs Hanna had declared her income as a nurse during the Debt Period: at [39]-[48]. The decision-maker found that Mrs Hanna did not advise Centrelink of her income from her employment as a nurse during the Debt Period as she was required to do, because she decided that it was inappropriate to do so for the reason which she gave on 1 May 2018, namely that she was managing a company and her income and losses could only be seen when she lodged a tax return: [45]. Accordingly, the decision-maker found that Mrs Hanna knew that Centrelink did not have the correct information about her income during the Debt Period: [45]. The decision-maker rejected Mrs Hanna’s claims that the lack of evidence that she reported fortnightly was attributable solely to the Department’s administrative error, finding that the debt arose because Mrs Hanna decided not to report as she was required to, and had last reported for the period 7 to 20 April 2018: [46].
The decision-maker also found that the Belgian pension payment which Mrs Hanna received was attributable to the Debt Period, and had been included in the recalculated debt: [51]. As to the compensation payment from NRMA Insurance, the decision-maker said that she was unable to make a finding as to when the payment was received and whether it was attributable as income to some extent to the Debt Period: [55]. As to the question whether Mrs Hanna was entitled to deduct business-related expenses from her gross income, the decision-maker found that the business was not carried on by Mrs Hanna personally, but by a company with separate and distinct legal personality from Mrs Hanna, and thus Mrs Hanna’s claim that she was carrying on a business and could offset losses and deductions from that business against her gross income was misconceived in the context of the applicable provisions of social security law: [56]-[64].
The decision-maker then dealt with the question whether there had been an error or errors solely attributable to the Commonwealth, or whether there were any “special circumstances” that allowed waiver of the whole or part of the debt, finding adversely to Mrs Hanna on those questions: [65]-[83]. In the course of that reasoning, the decision-maker made findings that Mrs Hanna decided not to comply with her statutory reporting obligations for AP because she did not think it was appropriate to do so, on the ground that fortnightly reporting was inappropriate because her income and losses could only be seen when she lodged a tax return: [71]. Mrs Hanna maintained that position despite receiving letters after 1 May 2018 reminding her of her obligations to report her income if she was working, and she knew that she was not reporting her income from her employment as she had done previously and therefore that it was not being taken into account to assess her rate of pension: [71]. Accordingly, the decision-maker found that Mrs Hanna knowingly failed or omitted to comply with her statutory reporting and requirements: [72]. The decision-maker rejected the submission that the medical conditions of Mrs Hanna and her husband constituted special circumstances: [80].
In concluding her reasons concerning the debt matter, the decision-maker set aside the reviewable decision of AAT1 made on 2 March 2020 and substituted for it the decision that Mrs Hanna had a liability for overpayment of AP for the Debt Period in the sum of $14,822.86: [83].
The decision-maker then turned to the pension rate matter. The decision-maker referred to the reference in the letter of 13 April 2018 to Mrs Hanna receiving a fortnightly gross payment of $2,799.55, and referred also to the ARO as having found that Mrs Hanna’s annual income from her employment and bank accounts (not taking into account the Belgian pension or the NRMA Insurance payment) as of 21 November 2017 was $57,592.41: [86]-[88]. The decision-maker said that that annual income figure of $57,592.41 demonstrated that the fortnightly earnings of $2,799.55 were not the basis of the calculation: [91]. The decision-maker in AAT1 had affirmed the ARO’s decision, and thus it was clear that the decision in AAT1 was made on the same basis as the ARO’s decision, namely that neither the Belgian pension nor the NRMA compensation payment were included in Mrs Hanna’s gross income: [95]. The decision-maker in AAT2 said that, for the reasons already given, the argument that the business expenses could be deducted from Mrs Hanna’s income was misconceived: [97]. The decision-maker said that the payment in arrears of the Belgian pension was attributable in part to the arrears period, and should properly be taken into account in calculating the amount of arrears payable to Mrs Hanna for that period, which neither the ARO nor AAT1 had done: [101]. The decision-maker said that that was the only error she had identified in the reviewable decision, and accordingly the reviewable decision should be set aside and remitted for reconsideration, with the direction that Mrs Hanna’s assessable income during the period 21 November 2017 to 23 March 2018 included any gross payments of her Belgian pension attributable to the arrears period: [101]-[102].
Appeal to the Federal Court
This appeal is brought pursuant to s 44(1) of the AAT Act, which entitles a party to a proceeding before the AAT to appeal to this Court on a question of law from any decision of the AAT in that proceeding. It is of great importance that the question or questions of law should be stated with precision, that being the point of r 33.12 of the Federal Court Rules 2011 (Cth) (the Rules): Haritos v Federal Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315 at [91] (Allsop CJ, Kenny, Besanko, Robertson and Mortimer JJ). As their Honours said in that case at [94], the issue must be approached as one of substance.
In the present case, Mrs Hanna was represented by her husband, Mr Hanna, who is not a lawyer. Ordinarily, a person may be represented in the Court by a lawyer or may be unrepresented (r 4.01(1) of the Rules). However, I granted dispensation from that rule pursuant to r 1.34 in view of the lack of any opposition by the respondent to that course, and also taking into account a current medical certificate pertaining to Mrs Hanna which was tendered. While some latitude in compliance with r 33.12 of the Rules in relation to stating the question of law in the notice of appeal may be appropriate in circumstances where a litigant is not represented by a lawyer, it must still be demonstrated as a matter of substance that the appeal is based on a question of law.
The “Questions of Law” put forward in Mrs Hanna’s amended notice of appeal are as follows:
1.Denial of procedural fairness; and
2.Errors of law on the face of the records; and
3.Failure to consider the Applicant’s evidences as they were not taken into consideration; and
4.Engaged in illogical and unreasonable fact finding; and
5.Misinterpretation and misapplication of the relevant laws and legislations; And
6.The decision was an improper exercise of the law; and
7.No evidence that justify the decision; and
8.The exercise of a power by applying a rule or policy without considering the merits of the case; and
9.The exercise of a power in a way that is so unreasonable that no reasonable person could have exercised it; and
10.The decision constitutes an abuse of power; and
11.Miscarriage of Justice.
The “Grounds relied on” in the amended notice of appeal are the same 11 matters. None of those constitutes a question of law, as distinct from a list of potential grounds of review which might, in identified circumstances, form the basis of questions of law.
In her written submissions in reply, which were described as having been prepared by Mr Hanna, Mrs Hanna put forward the following at paragraph 2.1 by way of “Questions of Law”:
[The decision-maker in AAT2] erred by virtue of the appeal process before the AAT2, and the decision being vitiated by:
2.1.1 Constitutional Error;
2.1.2 Jurisdictional Error;
2.1.3 Procedural Error;
2.1.4 Denial of Natural Justice/procedural fairness;
2.1.5 Errors in the Face of the Records;
2.1.6 Apprehension of Bias;
2.1.7 Made a decision without evidence/Ignoring relevant material and
2.1.8 Bad Faith;
2.1.9 “Wrong” decision by relying on irrelevant material.
None of those propositions constitutes a question of law, or is expressed with any degree of precision or even identification as to how the questions are said to have arisen.
When I asked Mr Hanna during his oral address to state the question of law which he sought to advance, Mr Hanna responded by referring to para 2.1 of his written submissions in reply. After some further deliberation, Mr Hanna said that the question of law was whether AAT2 had jurisdiction to make the findings which it made. While I accept that the question whether AAT2 had jurisdiction to make the findings which it made is indeed a question of law, there is no merit in any such appeal. Section 179 of the Administration Act provides that application may be made to the AAT for review of a decision of the AAT on AAT first review made under s 43(1) of the AAT Act. That provision applied to the proceedings decided by AAT2. It constitutes an enactment providing that applications, such as the application to AAT2 in the present case, may be made to the AAT for review of decisions, within the meaning of s 25(1) of the AAT Act. The jurisdiction of the AAT was thus regularly invoked, and it is that jurisdiction which the decision-maker in AAT2 exercised in making the findings in her decision.
The submissions made on behalf of Mrs Hanna, both orally and in writing, seek to challenge the merits of the AAT2’s decision, and seek to argue that AAT2 failed to make findings in favour of Mrs Hanna based on the evidence which was before it. However, this Court does not have jurisdiction to consider the merits of AAT2’s decision: see Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135 at [44] (Gleeson CJ, Gummow, Kirby and Hayne JJ). Further, there is no error of law simply in making a wrong finding of fact: Waterford v Commonwealth (1987) 163 CLR 54 at 77 (Brennan J); cited with approval in Haritos at [192] and in Enfield at [44]. In making that last observation, I should not be taken to be suggesting that there was any error of fact-finding by AAT2.
Accordingly, the appeal should be dismissed with costs.
I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jackman. Associate:
Dated: 19 October 2023
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