Hempel and National Disability Insurance Agency
[2024] AATA 3278
•3 September 2024
Hempel and National Disability Insurance Agency [2024] AATA 3278 (3 September 2024)
Division:NATIONAL DISABILITY INSURANCE SCHEME DIVISION
File Number(s): 2024/2416
Re:Sharon Hempel
APPLICANT
AndNational Disability Insurance Agency
RESPONDENT
DECISION
Tribunal:Mr S. Webb, Member
Date:3 September 2024
Place:Canberra
No jurisdiction. Application dismissed under s 42A(4) of the Administrative Appeals Tribunal Act 1975.
…….…[SGD]…………
Mr S. Webb, MemberCatchwords
NATIONAL DISABILITY INSURANCE SCHEME – jurisdiction – participant supports – compensation in respect of injury – recovery affected by special circumstances – estimate of compensation reduction amount – purported decision applying Rule relating to special circumstances – request for internal review denied – no request for reassessment of participant’s plan – purported decision lacks power and legal effect – no actual or deemed reviewable decision – no internal review decision – no jurisdiction
Legislation
Administrative Appeals Tribunal Act 1975, s 25, 29, 42A
National Disability Insurance Scheme Act 2013, s 9, 11, 32, 33, 35, 37, 47A, 48, 99, 100, 103, 107, 111, 116, 209
National Disability Insurance Scheme (Supports for Participants – Accounting for Compensation) Rules 2013 rr 3.1, 3.4, 3.5, 3.10
Cases
DYLS and National Disability Insurance Agency [2023] 2965
Kennedy v Comcare [2014] FCA 82
Miller v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 13
Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28
Semunigus and Minister for Immigration and Multicultural Affairs [1999] FCA 422
REASONS FOR DECISIONMr S. Webb, Member
3 September 2024
Sharon Hempel (Applicant) has life-long disability and is a participant in the National Disability Insurance Scheme (NDIS). She was injured in a motor vehicle accident and claimed compensation. The claim was resolved by consent and an amount of compensation was fixed. The National Disability Insurance Agency (NDIA) recovered an amount from the compensation. On review, the recovery was reversed, and the compensation amount was taken not to have been fixed in the special circumstances of the case. Subsequently, the NDIA issued a letter setting out an estimate of a ‘compensation reduction amount’ which may be applied to the Applicant’s next plan. The Applicant raised an issue of special circumstances. The NDIA issued a letter purporting to be a decision refusing to reduce the compensation reduction amount on grounds of special circumstances. It was in respect of this purported decision the Applicant lodged an application for review by the Tribunal and an application for grant of an extension of time in which to do so.
The NDIA asserts the Tribunal lacks jurisdiction to review the purported decision.
It is these issues, alone, which now rise for determination.
Relevant facts
The Applicant has life-long disability attributable to functional impairments resulting from Down Syndrome, Autism, and other medical conditions since birth.
On 15 October 2014, the Applicant was injured in a motor vehicle accident.
In 2017, the Applicant was approved entry to the NDIS as a participant.
On 14 September 2017, a Statement of Participant Supports (SOPS) was approved for the Applicant and her first participant’s plan commenced.
On 6 April 2018, the District Court of NSW issued a consent judgment awarding compensation fixed in the amount of $1.5 million to the Applicant.
On 12 April 2018, the NDIA issued a recovery notice under s 111(2) Of the National Disability Insurance Scheme Act 2013 (NDIS Act) in respect of an amount to be recovered under s 107 of that Act. The Applicant requested review of the notice decision.
On 30 November 2018, a delegate of the NDIA Chief Executive Officer (CEO) issued an internal review decision to set aside the notice decision and stated:
I am satisfied it is appropriate, in the special circumstances of the case, to treat the whole of the compensation payment Sharon Hempel received as not having been fixed by a judgement (including a consent judgement) or settlement.
This decision is made under section 116 of the [NDIS Act].
On 21 March 2023, a delegate of the CEO approved a SOPS for the Applicant and a new participant’s plan came into effect under s 37 of the NDIS Act.
On 22 March 2023, a delegate of the CEO wrote to the Applicant, seeking additional information by 12 April 2023 and stated:
… [the NDIA] will be undertaking a review of Sharon’s [NDIS] plan. At this time, a Compensation Reduction Amount (CRA) may be applied to Sharon’s plan in relation to the compensation received on or around 6 April 2018.
What is a Compensation Reduction Amount?
Compensation payments are often made to cover, amongst other things, a person’s past and future care needs. The National Disability Insurance Scheme (Supports for Participants – Accounting for Compensation) Rules 2013 (Compensation Rules) are about ensuring that where individuals receive compensation payments, the NDIS does not duplicate the funding for supports already provided for by these payments.
When compensation is received by an individual who is or who becomes a participant, the NDIS may reduce the funding for supports that may otherwise be approved in a participant’s plan. This is called a Compensation Reduction Amount…
On 27 March 2023, the Applicant’s mother and nominee, Valda Hempel (Ms Hempel), provided information to the NDIA. Further information was provided on 21 June 2023. Correspondence between the NDIA and Ms Hempel ensued.
On 31 August 2023, a compensation specialist officer of the NDIA (Sarah F), wrote to Ms Hempel and stated:
… Sharon’s case was heard today [by the Complex Case Committee], the outcome is we still need to investigate the compensation further.
In order to do this, I will need to prepare an Estimate of Compensation Reduction Amount that could be applied to Sharon’s next and future plans.
Ms Hempel replied on 5 September 2023, arguing there is no ground for raising a Compensation Reduction Amount as there is no duplication in supports funded under the NDIS and the compensation for injuries sustained in the motor vehicle accident.
On 6 September 2023, Sarah F wrote to Ms Hempel and stated:
The estimate for the Compensation Reduction was not prepared earlier, as you were appealing the decision to apply a potential reduction.
I took Sharon’s case to our Complex Case Committee on Thursday 31st July 2023 a determination was made to proceed with the Estimate.
…
Any potential reduction to Sharon’s plan will apply from her next plan.
Ms Hempel promptly replied, contesting this information, and complaining about the NDIA’s conduct.
On 29 September 2023, Sean Costello, another NDIA officer, wrote to Sarah F and stated:
I note you last communicated with the participant on 06/09/2023, additionally you made a special circumstance request on the 24/08/2023 which was not supported. Please make direct contact and advise the next step will be a CRA being applied to Sharon’s plan at the next plan review and document this in the system. That once this has been completed, she has the right to appeal the decision made.
Serial correspondence between Ms Hempel and NDIA officers ensued.
On 6 November 2023, Sarah F sent a letter to Ms Hempel setting out a Compensation Reduction Amount – Estimate, namely:
Estimated Compensation Reduction Amount
- Sharon’s CRA has been estimated as $933,103.07
- The CRA will be divided over a period determined by the NDIA’s Office of Scheme Actuary, which has been calculated at approximately 14 years
- An amount up to $68,609.34 may be reduced from Sharon’s next plan
- The CRA amount to be applied in future plans will be reassessed at each plan review
- If Sharon’s next plan amount is less than $68,609.34 the plan may be reduced to $0.00.
The Compensation Reduction Amount was calculated by subtracting “the Compensation Reduction Amounts that would have been applied to earlier NDIS plans but have been ignored by applying Special Circumstances under Rule 3.10” ($440,896.93) from the amount determined by the NDIA Office of Scheme Actuary. This was based on the “expected lifetime cost of reasonable and necessary supports if the person had been a participant in the NDIS since the date of injury” ($1,374,000.00).
Sarah F additionally stated:
If the NDIA considers that special circumstances apply, it may decide not to apply some or all of the CRA to Sharon’s NDIS plan.
…If we do not receive any further information by 4 December 2023 we will finalise the CRA and discuss with you how it will be applied to Sharon’s next plan.
On 9 November 2023, Ms Hempel wrote to the NDIA and stated:
We will be putting in for “Special circumstances on Sharon’s behalf under health and administrative error, 13.3.1” as it also appears from what you’ve sent in your email and also what Chris P, wrote in his email on 20 Oct, that despite all the medical evidence of Sharon’s pre-injury disabilities and severe impairments provided to the NDIS, it appears that these have been deliberately overlooked.
On 4 December 2023, Sarah F sent a document to Ms Hempel:
Compensation Reduction Amount – Special Circumstances outcome
…
… I have considered Sharon’s circumstances to determine if there are special circumstances under rule 3.10 of the [Compensation Rules].
Decision
Having considered the available information, I have decided your request, on behalf of Sharon, for special circumstances relating to the estimated Compensation reduction Amount (CRA) calculated under rule 3.13 of the [Compensation Rules], has been unsuccessful.
…
I have calculated Sharon’s estimated CRA to be $68,609.34 and have not reduced this amount. A CRA will apply to Sharon’s future plans.
The Compensation reduction Amount Estimate dated 6 November 2023 indicates the total Compensation Estimated Reduction Amount to be $933,103.07.
Reasons for Decision
The Statement of Claim dated 14 March 2018 indicates the particulars of injuries.
Funding for Sharon’s plan indicates supports provided for the compensable event.
The NDIS funding is to complement any other funding received by a participant. A Compensation Reduction Amount is applicable to Sharon’s plan to ensure there is no duplication of funding.
Documents considered for the Decision
…
Next Steps
A Compensation Reduction Amount will be applied to Sharon’s next plan.
Prior to applying the reduction, you may wish to provide evidence of past expenditure from the date of incident to one day prior to Sharon meeting access with the NDIS. Past expenditure will be taken into consideration and may reduce the total Compensation reduction Amount applied to Sharon’s plans.
The document did not provide information about any review rights.
On 6 December 2023, Ms Hempel requested internal review and “a copy of the NDIS funded supports provided to Sharon for her disabilities and costs, as well as a copy of the purported NDIS funding for Sharon’s injuries and costs”.
On 7 December 2023, Sarah F informed Ms Hempel:
An Internal Review cannot commence until the Compensation reduction Amount is applied to Sharon’s plan.
Currently we are at the Estimate phase of the calculation process.
The Compensation Reduction Amount will be applied to Sharon’s next plan.
Once this reduction is applied to the plan, a review of the decision can be considered.
On 11 December 2023, Sarah F informed Ms Hempel:
An Internal Review of a decision to apply a Compensation Reduction Amount to Sharon’s next plan cannot commence at this time.
The decision to apply the reduction to Sharon’s next plan will occur when Sharon’s next plan is built. It has not been applied to the current plan. Therefore, the decision has not been made yet.
At such time as the Compensation Reduction is applied, a request for a review of this decision can be lodged.
On 4 January 2024, Ms Hempel wrote to the CEO and requested “a review of the unjust decision made by the NDIS compensation team’s [Sarah F] on 6/11/2023” and stated:
Since birth Sharon has required high level 24/7 care. (Around the clock).
On top of severe Down Syndrome, Sharon suffers Autism, significant skeletal and joint conditions of the cervical spine, bilateral hips (right hip dysplasia) and several joints. Early degenerative changes of osteoarthritis and scoliosis with global pain and spasticity causing mobility issues. All pre-accident, medically provable beyond doubt.
…
Yet your compensation team want the entirety of Sharon’s compensation payout to pay for all the disabilities Sharon has always had (pre accident) as well as for injuries from the car crash.
On 21 March 2024,, a Senior Resolutions Specialist of the NDIA (Lauren S), informed Ms Hempel “no reduction amount has been approved or applied to [the Applicant’s] NDIS plan so there is no decision that can be reviewed or appealed”.
On 24 April 2024, the Applicant’s legal representative lodged an application for review of the 4 December 2023 ‘decision’ with an application for grant of an extension of time in which to do so.
Issues
There are two issues for determination:
(a)the Tribunal’s jurisdiction; and if necessary
(b)grant of an extension of time for the Applicant to lodge an application for review.
Jurisdiction
The Applicant accepts she received compensation and damages in respect of personal injuries sustained in the motor vehicle accident. She argues the compensation payment is not within the meaning of ‘compensation’ as defined in s 11 of the NDIS Act and the Compensation Rules are not applicable as the compensation payment was not wholly or partly in respect of the cost of supports that may be provided to a participant in the NDIS. The Applicant asserts the NDIA has made, or is taken to have made, decisions applying or relating to the calculation and application of a ‘compensation reduction amount’ (CRA) to her participant plan. In seeking review, the Applicant draws several threads which, she argues, enliven the Tribunal’s jurisdiction.
Firstly, the Applicant contends the NDIA made a decision on 4 December 2023 under s 116 of the NDIS Act, which is a reviewable decision under s 99(1) of the NDIS Act. On 6 December 2023 and 4 January 2024, a request was made for review of this decision under s 100 but, so this argument goes, the NDIA refused to undertake the review. Relying on Semunigus and Minister for Immigration and Multicultural Affairs[1] (Semunigus) and Kennedy v Comcare[2] (Kennedy), the Applicant asserts the NDIA impliedly affirmed the 4 December 2023 decision and the application for review by the Tribunal is in respect of this implied decision.
[1] [1999] FCA 422.
[2] [2014] FCA 82.
Secondly, the Applicant contends the decision on 4 December 2023 required the NDIA to undertake a review pursuant to Division 4, Part 2, Chapter 3 of the NDIS Act. She asserts the NDIA failed to vary her plan under s 47A(2) or to revise her plan under s 48(4) of the NDIS Act as required by rule 3.4 of the Compensation Rules. In her submission, a decision not to vary or not to reassess a participant’s plan is a reviewable decision under s 99(1). In this argument, the requests for review made on 6 December 2023 and 4 January 2024 should be construed as requests for review of the implied decision not to vary or not to reassess her plan, and the NDIA’s express or implied decision not to undertake a review, as requested, under s 100 is a decision capable of review by the Tribunal under s 103 of the NDIS Act.
Thirdly, in a further iteration of this argument, the Applicant argues the requests for review made on 6 December 2023 and 4 January 2024 should be construed as requests for the CEO to vary her plan under s 47A or to reassess her plan under s 48. In this argument, the CEO failed to vary or reassess her plan within the prescribed 21 day period and this results in a deemed decision being made under s 47A(5) or s 48(4) which is subject to automatic review by operation of s 100(5). As the CEO failed to make a decision under s 100(6) within the period prescribed in s 100(6A), so the argument goes, the CEO is taken to have affirmed the decision, and that decision is susceptible to review by the Tribunal.
Fourthly, the Applicant alleges, on 7 December 2023, the NDIA made a decision to reject her request for internal review under s 100, and this is a decision capable of review by the Tribunal.
It is the Applicant’s case that each of these alleged decisions is presently the subject of the application for review, and the Tribunal has jurisdiction to review them.
The NDIA disagrees. In the NDIA’s submission, the letters dated 6 November 2023 and 4 December 2023 are in respect of CRA estimates. Each letter, the NDIA asserts, is not a decision for the purposes of s 33(2) of the NDIS Act in respect of approval of a SOPS, or a decision to conduct a reassessment of the Applicant’s plan under s 48(1). The NDIA argues these letters communicate decisions which have no legal effect and they are not ‘reviewable decisions’ under s 99 of the NDIS Act. Consequently, the NDIA argues, there is no actual or deemed decision under s 100(6) for which application may be made under s 103 for review by the Tribunal.
With regard to the Compensation Rules, the NDIA alleges the decision on 4 December 2023 is not a valid exercise of power under rule 3.10. In the NDIA’s submission, consideration of the Compensation Rules is a preparatory step which is required before approving a SOPS under s 33(2) of the NDIS Act. The NDIA asserts rule 3.4 does not create an independent statutory basis to revise a participant’s plan and notes that a SOPS may only be changed by variation under s 47A or by approving a new SOPS following reassessment of a participant’s plan under s 48. The NDIA contends the Applicant’s 24 month plan came into effect on 23 March 2023 and it is scheduled for reassessment prior to 20 March 2025, and no request for earlier reassessment under s 48(2) or variation under s 47A(2) has been made. In the NDIA’s submission, without such a request, there can be no deemed decision under s 47A(5) or s 48(4) which is reviewable under s 100 or, subsequent to an application under s 103, by the Tribunal.
The NDIA asserts the 4 December 2023 letter cannot be construed as a decision to vary the Applicant’s plan under s 47A because it did not make any changes to the SOPS approved under s 33(2) on 23 March 2023. Furthermore, in the NDIA’s submission the 6 November 2023 and 4 December 2023 letters do not determine a CRA which is applicable to the Applicant’s current plan or any future plan. The NDIA argues the letters provide CRA estimates (including in respect of special circumstances) that do not bind future decision-makers when reassessing the Applicant’s plan and considering the extent to which, if at all, the compensation payment is to be taken into account when approving funding for reasonable and necessary supports for the Applicant. Estimates of this kind, so the argument goes, are not reviewable decisions.
The NDIA does not accept the proposition that the 4 December 2023 letter is a decision under s 116 of the NDIS Act which is reviewable by the Tribunal. The NDIA alleges the letter is not a decision in respect of a recovery notice issued for the purposes of Chapter 5 of the NDIS Act. Matters of this kind, the NDIA argues, were dealt with in 2018 and there are no outstanding recovery notices. With regard to the issue of special circumstances, the NDIA submits the internal review decision on 30 November 2018 to treat the total compensation payment as not having been fixed was for the purposes of Chapter 5, and this does not affect the requirement in s 33(5) to apply the Compensation Rules when approving a SOPS under s 33(2).
The Tribunal’s jurisdiction is conferred by legislation. Section 25 of the Administrative Appeals Tribunal Act 1975 (AAT Act) provides for applications to be made to the Tribunal:
(1) An enactment may provide that applications may be made to the Tribunal:
(a)for review of decisions made in the exercise of powers conferred by that enactment; or
(b)for the review of decisions made in the exercise of powers conferred, or that may be conferred, by another enactment having effect under that enactment.
Momentarily stepping over the requirement for an application under s 25 of the AAT Act to be made within the time prescribed in s 29(2), the manner in which an application for review by the Tribunal is to be made is set out in s 29(1) of the AAT Act. Importantly, in order to engage the Tribunal’s jurisdiction, the application must be for ‘review of a decision’ which is reviewable by the Tribunal. The Tribunal does not exercise review power at large and the requirement for particularity in respect of the impugned ‘decision’ is of central importance when determining, for example, the prescribed fee which is applicable, or the prescribed time in which the application should be made, or as in this case, the Tribunal’s jurisdiction to review the decision. While failure to provide reasons for the application does not invalidate the application, for the Tribunal’s jurisdiction to be engaged, the particular decision which is the subject of the application for review cannot be left in doubt.[3]
[3] Miller v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 13 at [13]-[15].
Provision is made in s 103 of the NDIS Act for applications to be made to the Tribunal for review:
(1) Applications may be made to the Administrative Appeals Tribunal for review of a decision made by a reviewer under subsection 100(6).
Note: Under the Administrative Appeals Tribunal Act 1975, notice must be given to persons whose interests are affected by a decision of the reviewer.
(2) If:
(a) an application is made to the Administrative Appeals Tribunal for review of a decision made by a reviewer under subsection 100(6); and
(b) the decision relates to a statement of participant supports in a participant’s plan; and
(c) before a decision on the review is made and despite subsection 26(1) of the Administrative Appeals Tribunal Act 1975:
(i) the CEO varies the plan under subsection 47A(1) of this Act and the variation is a change to that statement; or
(ii) a new plan for the participant comes into effect under section 37 of this Act;
then:
(d) if subparagraph (c)(i) applies—the application is also taken to be an application for review of the decision to make the variation covered by that subparagraph; or
(e) if subparagraph (c)(ii) applies—the application is also taken to be an application for review of the decision to approve the statement of participant supports in the new plan.
As can be seen, the Tribunal’s jurisdiction to review a decision made under s 100(6) of the NDIS Act is expanded in circumstances where, during the Tribunal proceedings, the CEO varies the participant’s plan (by changing the SOPS) under s 47A(1) or a new plan comes into effect under s 37 of the NDIS Act. In the latter case, a new plan comes into effect following reassessment under s 48 and the approval of a SOPS under s 33. Importantly, by operation of s 103(2)(d) and (e), the internal review mechanism under s 100 does not apply in circumstances where the terms of s 103(2)(c)(i) or (ii) are met.
It follows from this, for the Tribunal’s jurisdiction to be enlivened there must be an application for review of a decision made, or taken to have been made, under s 100(6) of the NDIS Act relating to a SOPS. Thereafter, in the course of the Tribunal proceedings, should the CEO make a further decision to vary the participant’s SOPS under s 47A or to approve a new SOPS under s 33(2) following reassessment of the participant’s plan under s 48, the further decision is joined in the Tribunal’s review.
The application for review in this case is in respect of the decision on 4 December 2023, a copy of which accompanied the application. While some latitude might be given where uncertainty arises in respect of a deemed statutory decision within a sequence of decision-making under the legislation conferring jurisdiction on the Tribunal, and the degree of latitude might be more elastic when dealing with an applicant without legal representation, latitude should not be taken too far by trawling through decision-making processes in the hope of identifying a decision which is reviewable and expanding the application for review to accommodate it.
Unfortunately, this is such a case.
There is a surprising lack of clarity in the procedure adopted and the language used by the NDIA in communications with the Applicant which have led to this application being made. To some degree, this might have informed the approach adopted by the Applicant and her legal guardians and representatives in seeking to challenge a purported decision they cavilled with. One can understand the concerns they have expressed and the evolving nature of the arguments their legal representatives have attempted to raise, unravelling and challenging the actions and purported decisions of the NDIA which threaten NDIS funding for supports the Applicant relies upon.
To resolve these matters, it is necessary to consider the legislative scheme for dealing with compensation. There are two statutory limbs. Chapter 5 of the NDIS Act deals with obtaining compensation and recovering amounts paid under the NDIS. The Compensation Rules provide a mechanism for taking compensation into account when determining funding for a participant’s reasonable and necessary supports under the NDIS.
The Compensation Rules are prescribed for the purposes of s 35 in Part 2, Chapter 3 of the NDIS Act:
(1) The National Disability Insurance Scheme rules may make provision in connection with the funding or provision of reasonable and necessary supports or general supports, including but not limited to prescribing:
(a) methods or criteria to be applied, or matters to which the CEO is to have regard, in deciding, the reasonable and necessary supports or general supports that will be funded or provided under the National Disability Insurance Scheme; and
(b) reasonable and necessary supports or general supports that will not be funded or provided under the National Disability Insurance Scheme; and
(c) reasonable and necessary supports or general supports that will or will not be funded or provided under the National Disability Insurance Scheme for prescribed participants.
(2) The National Disability Insurance Scheme rules referred to in subsection (1) may relate to the manner in which supports are to be funded or provided and by whom supports are to be provided.
(4) The National Disability Insurance Scheme rules referred to in subsection (1) may relate to how to take into account:
(a) lump sum compensation payments that specifically include an amount for the cost of supports; and
(b) lump sum compensation payments that do not specifically include an amount for the cost of supports; and
(c) periodic compensation payments that the CEO is satisfied include an amount for the cost of supports.
(5) The National Disability Insurance Scheme rules referred to in subsection (1) may relate to how to take into account amounts that a participant or prospective participant did not receive by way of a compensation payment because he or she entered into an agreement to give up his or her right to compensation.
By operation of s 33(5), the Compensation Rules must be applied when deciding to approve or not approve a SOPS under s 33(2).
Noting the terms of s 209(1)(a) and (9)(e) of the NDIS Act, the Compensation Rules must not be inconsistent with and must not exceed the matters which are permitted to be prescribed under s 35. The meaning and the range of operation of the Compensation Rules must be determined by reference to the language of the instrument viewed as a whole in the context of the statutory purposes it serves within the scheme of the NDIS Act.[4] Read in this context, the Compensation Rules prescribe how to take account of ‘lump sum compensation payments’ within the terms of s 35(4) in connection with the funding of reasonable and necessary supports or general supports, including the matters set out in s 35(1)(a), (b) and (c).
[4] Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 at [69].
The clear purpose of these provisions is to ensure that ‘compensation’ is taken into account when determining reasonable and necessary supports that will be funded for a participant under the NDIS. The legislative policy adopted by the Parliament sets out a statutory mechanism for determining the extent to which funding for reasonable and necessary supports should be reduced to take account of ‘compensation’ obtained by a participant.
Rule 4.4 adopts the meaning given to ‘compensation’ in s 11 of the NDIS Act:
(1) In this Act:
compensation means a payment (with or without admission of liability) in respect of:
(a) compensation or damages in respect of personal injury; or
(b) personal injury, under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or
(c) personal injury, in settlement of a claim for damages or a claim under such an insurance scheme;
that is wholly or partly in respect of the cost of supports that may be provided to a participant (whether or not specifically identified as such). It does not matter whether the payment is made directly to the person who sustained the personal injury or to another person in respect of that person.
The mechanism for taking ‘compensation’ into account is set out in rule 3.5 of the Compensation Rules:
3.5 In considering whether or not to approve a statement of participant supports in a plan for the participant (whether the first plan or a revised plan), the CEO is to take account of the compensation by reducing the funding for reasonable and necessary supports that would otherwise be approved by the appropriate compensation reduction amount under paragraphs 3.11 to 3.21.
Key to operation of this mechanism is the power to prospectively approve a SOPS under s 33(2) in compliance with (among other things) the matters set out in s 33(5).
It is in this context and for these purposes, rule 3.10 provides the CEO with discretion in the presence of special circumstances:
3.10 For the purposes of paragraph 3.5, the CEO may ignore the whole or part of a compensation reduction amount that would otherwise arise under this Part if the CEO thinks it appropriate to do so in the special circumstances of the case (which may include financial hardship suffered by the participant).
As can be seen, the discretion is to ignore all or part of a CRA which would otherwise arise ‘under this Part’, namely Part 3 of the Compensation Rules. The application of Part 3 is subject to rule 3.1:
3.1 This Part applies in relation to a person who is a participant, or who later becomes a participant, if the impairment of the person was caused to any extent by a personal injury, and one of the following cases applies:
(a) the person received compensation under a judgement or settlement in respect of the injury in which:
(i) it is possible to identify the NDIS component of the amount of compensation (NDIS component is defined in paragraph 4.4); and
(ii) the component is either fixed by a non-consent judgement or is objectively identifiable (eg commutation of benefits under a statutory scheme); or
(b) the person received compensation under a judgement or settlement in respect of the injury that:
(i) does not satisfy paragraph (a) and
(ii) fixes an amount of compensation in respect of the injury; or
(c) the person is receiving compensation under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or
(d) the person:
(i) entered into an agreement to give up a right to compensation in respect of the injury; and
(ii) because of that agreement, there are amounts that the person did not receive by way of a compensation payment (even if the person received other amounts by way of compensation payment in respect of the injury); and
(iii) the CEO is not satisfied that it was reasonable, in the circumstances, for the person to have entered into the agreement.
Chapter 5 of the NDIS Act sets out powers which relate to obtaining ‘compensation’ and recovering ‘recoverable amounts’ in respect of ‘past NDIS amounts’. It is in this context that s 116 confers discretion on the CEO to provide relief in the presence of special circumstances:
For the purposes of this Chapter, the CEO may treat the whole or part of a compensation payment as not having been fixed by a judgement (including a consent judgement) or settlement, if the CEO thinks it is appropriate to do so in the special circumstances of the case.
Even though the term ‘special circumstances’ appears in s 116 and rule 3.10, it does not follow that the provisions are synchronous, when it is perfectly clear they are not, and each serves a different purpose.
Nevertheless, where a determination is made under s 116 to treat a compensation payment as not having been fixed for the purposes of Chapter 5, the significance of this is open to question when considering rule 3.1, and the applicability of Part 3, and rule 3.10 of the Compensation Rules for the purposes of s 35 of the NDIS Act. These are not matters I need to determine for present purposes.
Turning to consider the controversial documents and related matters the Applicant argues the Tribunal has jurisdiction to review, the letter of 4 December 2023 uses language of certainty and decision: “Compensation Reduction Amount – Special Circumstances outcome” and “I have considered … circumstances to determine…”, “I have decided…”, “I have calculated…”, and “A CRA will apply…”. The difficulty is the 4 December 2023 letter is not an administrative decision authorised by any provision of the NDIS Act or the Compensation Rules. Despite the language used, it is not a decision made under rule 3.10 of the Compensation Rules. A decision under rule 3.10 can only be made for the purposes of rule 3.5 in respect of a CRA under Part 3 of the Compensation Rules. No such CRA has been determined. A decision of this kind can only be made within the mandatory decision-making framework set out in s 33(5) and s 35 which applies when approving a SOPS under s 33(2) of the NDIS Act. [5] The letter of 4 December 2023 does not meet this threshold.
[5] DYLS and National Disability Insurance Agency [2023] 2965 at [4].
Without venturing too far into issues associated with void or voidable administrative decisions and the question whether the 4 December 2023 ‘decision’ has legal force, an administrative decision can be operationally effective, at least until such time as it is set aside or declared to be invalid, but “an administrative decision has only such force and effect as is given to it by the law pursuant to which it was made”. [6] The 4 December 2023 ‘decision’ lacks legal foundation in the NDIS Act. Aside from the obvious questions of power and authority, the ‘decision’ of 4 December 2023 purports to determine something that cannot be determined because the essential factual preconditions do not exist. It is for this reason it can have no operational or legal effect even though it exists, in fact.
[6] Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11, per Gaudron and Gummow JJ at [46].
Despite the language used, which I consider inapt, and the absence of a detailed rationale or explanation of the statutory framework it purports to address, the 4 December 2023 letter has the status of non-binding advisory opinion, without legal force or effect, under the NDIA’s policy of giving participants who obtain compensation advance notice of any potential related reduction in funding for supports which might be applied. The policy, as I understand it, is to provide such participants with a prospective estimate of a possible CRA which might be applied when their plan is reassessed. In this instance, the estimation process extended to consideration of special circumstances.
One can comprehend the desirability of providing participants and their families with advance estimates of any reduction in funding for reasonable and necessary supports on which they rely. Nevertheless, it is reasonable to expect this would be done in a facilitative manner with a participant, within the spirit of s 32 of the NDIS Act, and with appropriate sensitivity to the particular circumstances of the participant, noting that circumstances of injury and disability are in many cases challenging and likely to be associated with significant difficulties. It is for this reason one would expect clear information about the rationale for applying a CRA in the particular circumstances would be provided in plain language, setting out the relevant facts and materials on which the estimated CRA has been determined and the decision-making process which will be followed before any CRA is applied, including the participant’s review rights.
Unfortunately, the letters of 6 November 2023 and 4 December 2023 do not reach this standard, and the estimation process or policy applied in this case has caused a great deal of consternation and confusion for the Applicant’s parents.
Nevertheless, such considerations do not bear upon the Tribunal’s jurisdiction.
I am satisfied the 4 December 2023 letter is not a ‘reviewable decision’ under s 99(1) of the NDIS Act. This is so even if the letter is considered to be a ‘decision’ in fact. Consequently, there is no basis on which a decision under s 100(6) can be taken to have been made consequent to either an actual decision to refuse to review the 4 December 2023 ‘decision’ (in the letter of 7 December 2023, for example), or the failure to review the ‘decision’ (following the requests made on 6 December 2023 and 4 January 2024).
From this, it follows the Tribunal has no jurisdiction to review the 4 December 2023 ‘decision’ accompanying the application for review.
As will appear, no different result is obtained following the other threads drawn by the Applicant’s legal representatives in respect of purported actual or deemed decisions under s 47A and s 48 of the NDIS Act.
Rule 3.4 of the Compensation Rules provides that the CEO “is to revise” a participant’s plan. Even though this language is directive, the rule must be construed in a manner which is consistent with s 35 and the statutory mechanisms for varying and reassessing participant plans set out in Part 2, Chapter 3 of the NDIS Act. The rule cannot direct and does not limit or usurp exercise of the discretion conferred upon the CEO by s 47A(1) and (2) or s 48(1) and (2).
The proposition that a CRA could be applied using the power to vary a participant’s plan under s 47A cannot be accepted. The scope of the power to vary a participant’s plan is confined to the matters covered by s 47A(1A). Those matters do not extend to reducing the funding of reasonable and necessary supports for a participant to take account of ‘compensation’ the person has obtained.
I do not accept the Applicant’s assertion the deeming effect of s 48(4) is engaged as the requests for review made on 6 December 2023 and 4 January 2024 should, despite the express language used, be construed as requests for reassessment of the Applicant’s plan. By this means, the Applicant purports to identify deemed decisions which could be reviewed by the Tribunal. There are a number of things to say about this.
I am not persuaded the requests made on 6 December 2023 and 4 January 2024 can be construed as requests under s 48(2) for reassessment of the Applicant’s plan.
Even if the requests were to be construed in that way, such that s 48(3) would be engaged, the deemed decision under s 48(4) which ultimately might arise after the 21 days period had elapsed would be a decision not to reassess the plan. Following the thread of the argument, a decision of that kind would be subject to automatic review under s 100(5)(b) and, should no decision be made under s 100(6) within the period specified in s 100(6A), then a decision could be taken to have been made to affirm the reviewable decision which, would then be reviewable by the Tribunal. There are many difficulties with this argument. Most importantly, no application under s 103 has been made for review of any decision which might be taken to have been made under this scenario. Stepping over that issue, even if the Tribunal was seized of jurisdiction, the jurisdiction would be in respect of a decision under s 48(3), whether or not to reassess the Applicant’s plan. A positive finding on that question would mean the CEO would then be required to reassess the plan. The Tribunal would not have jurisdiction to make any determination in respect of a CRA.
The Applicant’s assertion the NDIA actually or impliedly refused to conduct a review under s 100 does not advance the matter. For the temporal aspect in s 100(6A) to apply for the purposes of s 100(6), the decision-making power must be enlivened by a request under s 100(2) or a decision within the terms of s 100(5). On the materials I have examined and following the threads the Applicant’s legal representatives have drawn, there is no such request or decision.
Finally, despite careful consideration, I am not persuaded the various threads the Applicant’s representatives have drawn lead to a decision that is within the terms of the Applicant’s present application which the Tribunal has jurisdiction to review. The Tribunal’s jurisdiction cannot be enjoined on such a speculative basis. Unfortunately for the Applicant, the bow threaded with these arguments is too long.
I am satisfied the Tribunal does not have jurisdiction to review the decision which is subject of the application for review, even generously construed.
That being so, there is no basis on which to proceed to consider issues of time for the purposes of s 29 of the AAT Act, and the application must be dismissed for want of jurisdiction under s 42A(4) of the AAT Act.
Decision
No jurisdiction. The application is dismissed under s 42A(4) of the AAT Act.
I certify that the preceding 82 (eighty-two) paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member.
...[SGD]....
Associate
Dated: 3 September 2024
Date(s) of hearing:
21 June & 1 August 2024
Date final submissions received:
30 July 2024
Counsel for the Applicant:
Solicitors for the Applicant:
Mr Christopher Bilboe
Ms Belinda Kochanowska, Intrepidus Law
Solicitors for the Respondent:
Mr Jack Bewsher, NDIA
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