Isele and Secretary, Department of Social Services (Social services second review)

[2016] AATA 340

Isele and Secretary, Department of Social Services (Social services second review) [2016] AATA 340 (27 May 2016)

Division	GENERAL DIVISION
File Number(s)	2015/4162
Re	John Isele
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Deputy President Bernard McCabe
Date	27 May 2016
Place	Brisbane

The decision under review is affirmed.

..............................[Sgd]..........................................

Deputy President Bernard McCabe

Catchwords

SOCIAL SECURITY – age pension entitlement – extent to which issue estoppel applies – no application made under s 42B – previous decision by consent – whether applicant entitled to age pension – decision under review affirmed   

Legislation

Social Security Act 1991 (Cth) ss 1161, 1173(2)

Administrative Appeals Act 1975 (Cth) ss 34D(1), 42B,

Cases

Filsell and Comcare [2009] AATA 90; (2009) 109 ALD 198
Re Rana and Military Rehabilitation and Compensation Commission [2008] AATA 558

Marchlewski and Secretary, Department of Family and Community Services [2004] AATA 1027

REASONS FOR DECISION

Deputy President Bernard McCabe

27 May 2016

1. This case is about Mr John Isele’s entitlement to the age pension between September 2007 and August 2009. The question arises because there is some confusion over how the Secretary should treat compensation payments Mr Isele received during that period for the purpose of the assets and income test. If Mr Isele is right, he should have been paid the pension at a higher rate. If the Secretary is right, Mr Isele was not entitled to the pension.

2. The picture is complicated by the fact this Tribunal already dealt with the issue in a consent decision under s 34D(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) on 30 April 2008. The decision was made after the parties reached agreement in the course of an alternative dispute resolution process. In the agreement, the Secretary[1] acknowledged part of the weekly compensation payments should be treated as if they had not been made to the applicant because of the special circumstances of the case. That concession meant the applicant was entitled to receive an age pension paid at the rate of $1 per fortnight. While the amount of the pension was nominal, the fact Mr Isele was paid the pension at all meant he could access valuable entitlements. He presumably enjoyed those entitlements until changes in circumstances meant he ceased being eligible for the pension from 20 August 2009.

   [1] The Secretary in that application was the secretary of the current respondent’s predecessor agency, the Department of Families, Housing, Community Services and Indigenous Affairs.

3. Mr Isele wants to revisit the question of his entitlements in the period between September 2007 and August 2009. The Secretary says he should not be allowed to do so because that issue has already been resolved. The Secretary says the applicant’s contentions about his entitlements are wrong in any event.

   Should the Tribunal revisit the issue?

4. The Secretary says the Tribunal finally adjudicated the matter in 2008 when it made the consent decision at the request of both parties. In those circumstances, I was told, the Tribunal has no jurisdiction to entertain the application.

5. Questions of jurisdiction and issue estoppel in Tribunal proceedings have been litigated extensively in the past. When courts refer to issue estoppel, they typically mean the court will not entertain an argument over an issue because that issue or that argument has already been conclusively dealt with in earlier proceedings brought by that applicant. In substance, the doctrine of issue estoppel is intended to prevent a party from re-litigating disputes which have already been resolved.

6. There are questions over the extent to which the doctrine of issue estoppel applies in Tribunals: see generally D. Pearce, Administrative Appeals Tribunal (2015) (4^th ed) at pp 327ff and decisions analysed therein. In Filsell and Comcare (2009) 109 ALD 198, DP Jarvis suggested (at [61]) it was preferable to use the Tribunal’s powers under s 42B of the AAT Act to dismiss frivolous or vexatious claims rather than get into debates over estoppel and jurisdiction. That is often an elegant solution. It has also been suggested the Tribunal could simply refuse to entertain the application in reliance on the general power to control its own proceedings under s 33 of the AAT Act: see Marchlewski and Secretary, Department of Family and Community Services [2004] AATA 1027 per SM Bell at [13]. A different approach was suggested in Re Rana and Military Rehabilitation and Compensation Commission [2008] AATA 558. In that case, DP Forgie suggested the Tribunal was functus officio once it had delivered itself of a final decision that dealt with the arguments of the parties and the circumstances of the case; if it were to effectively re-open the case by entertaining a fresh application with respect to that decision from the same party wishing to re-litigate the same issues on the same basis, the Tribunal would be impermissibly reviewing its own decision: at [99]-[100]. But DP Forgie pointed out there was usually nothing to prevent an applicant from making more than one application, and he or she was entitled to a decision in relation to each application. She said the Tribunal was not prevented from reviewing that subsequent decision, even though it related to the same subject matter as that contained in an earlier decision. The better course was to deal with the problem under s 42B, although DP Forgie cautioned that power should also be used sparingly.

7. I am unlikely to resolve the vexed question of how to handle attempts at re-litigation in these reasons. I would have preferred to deal with this application under s 42B of the AAT Act. The applicant has raised his arguments in relation to the same argument before: that much is clear from the decision of the Social Security Appeals Tribunal decision made on 30 January 2008: exhibit two at pp 3ff. The review process continued and was concluded in this Tribunal by the consent decision. That decision was the outcome of an alternative dispute resolution process in which the parties had ample opportunity to ventilate the issues. Mr Isele struck a good deal for himself at the time. While he did not get the rate of pension he wanted, the Secretary was able to sweeten the offer by making a concession in relation to the applicant’s special circumstances. The special circumstances issue is not before me. If I were to permit Mr Isele to re-litigate the matter and disagree with his arguments, I would have to make a decision that he was not entitled to any pension, which would trigger an obligation to repay any benefits he received.

8. If I formed the view at an early stage that the argument was unlikely to be successful, I would have been able to use the power under s 42B to dismiss the proceedings on that basis they were “frivolous, vexatious, misconceived or lacking in substance” or had “no reasonable prospect of success”. But the Secretary did not make an application under s 42B at an early stage. The questions about jurisdiction were not raised until the hearing. It therefore made sense to hear the applicant’s story and deal with it on the merits.

   Mr Isele’s argument

9. I will begin by briefly summarising the facts since they are not in dispute. The applicant was a public servant who was injured at work in 1981. He became incapacitated for work in 1985. The Commonwealth Employee’s Compensation Commission began to pay the applicant a weekly amount in workers’ compensation. He continued receiving those payments from the Commission until it was replaced by Comcare. Thereafter, he received payments from Comcare and Comsuper. He also received other investment income. The amount of all those payments was taken into account when assessing the rate of age pension he could receive from 2007. By the Secretary’s calculations, the applicant was not entitled to receive any payment of the age pension in the period under review. That view was taken in light of the Secretary’s approach to dealing with the periodic compensation payments from Comcare.

10. The Secretary says the age pension is a compensation affected payment[2] and s 1173(2) of the Social Security Act 1991 (Cth) requires that the amount of the daily rate of Mr Isele’s periodic compensation payment received from Comcare should be deducted on a “dollar for dollar” basis from the amount of the daily rate of the compensation affected payment. If that occurs, the amount payable falls to nil. The obligation to proceed in that way applies if the compensation in question is received after 20 March 1997: s 1161(6).

    [2] Section 17(1)(aa), Social Security Act 1991

11. Mr Isele says that approach was wrong. He says the payments he received from Comcare during the relevant period should not have been deducted on a one-for-one basis from the daily rate; rather, they should have simply been included in his total income and assessed accordingly. If that had been done, he would have been entitled to a part age pension. He argued that approach was justified in light of s 1161. Section 1161(1)(b) says a compensation affected payment (including the age pension) would be dealt with under Part 3.14 (and therefore deducted from the daily rate under s 1173(2)) if “the compensation was received on or after 1 May 1987 and the claim for the compensation affected payment was made on or after 1 May 1987”. Mr Isele said his entitlement to compensation arose out of an injury that occurred in 1981, while the payment of compensation began in 1985 – that is, before 1 May 1987, and certainly before 20 March 1997. In those circumstances, he argued, the age pension was not properly regarded as a compensation affected payment in his case because the event giving rise to the entitlement to the compensation pre-dated the introduction of the legislative regime.

12. Mr Isele is wrong. While the event which gave rise to an entitlement to compensation may have occurred prior to 1987, the regular payments of compensation were paid each week or fortnight thereafter. Each payment was properly brought into consideration in the way prescribed by s 1173(2) when it was received because the applicant lodged his claim for the compensation affected payment after 1 May 1987. The regular periodic payments of compensation are not somehow deemed to be received at the time of the injury.

    Conclusion

13. The decision under review must be affirmed.

14.     I certify that the preceding 13 (thirteen) paragraphs are a true copy of the reasons for the decision herein of Deputy President Bernard J McCabe.

........................[Sgd]............................

Associate

Dated 27 May 2016

Date of hearing	11 February 2016
Applicant	In person
Advocate for the Respondent	Mr R McQuinlan, Department of Human Services