Jaghuri and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2008] AATA 14

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 14

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/0701

GENERAL ADMINISTRATIVE DIVISION		)
Re		ABDUL HAKIM JAGHURI

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Regina Perton, Member

Date8 January 2008

PlaceMelbourne

Decision The Tribunal affirms the decision under review.

(sgd) Regina Perton

Member

SOCIAL SECURITY ‑ lump sum compensation ‑ preclusion period ‑ whether special circumstances exist

Social Security Act 1991 ss 17, 1170, 1184K

Ryde v Secretary, Department of Family and Community Services [2005] FCA 866

REASONS FOR DECISION

8 January 2008 Regina Perton, Member    

1.      Abdul Jaghuri was seriously injured in a workplace accident on 20 December 2001.  He received weekly payments of compensation until 14 April 2004.  Mr Jaghuri settled his workers’ compensation claim for a total lump sum of $375,000 in November 2004.  As a result, Mr Jaghuri was subject to a compensation preclusion period from 3 December 2004 to 24 June 2010.

2.      On 26 June 2006 Mr Jaghuri lodged a claim for disability support pension (DSP).  Centrelink, which administers DSP for the Department of Families, Housing, Community Services and Indigenous Affairs rejected Mr Jaghuri’s application due to the preclusion period.  On 30 October 2006 an authorised review officer of Centrelink (ARO) affirmed the decision to reject the claim for DSP due to the preclusion period.  On 25 January 2007, the Social Security Appeals Tribunal (SSAT) affirmed the original decision.  On 6 March 2007, Mr Jaghuri lodged an application for review with the Tribunal.  At the hearing, a Farsi interpreter facilitated communication.

3.      The issue before the Tribunal is whether there are grounds to waive part or all of the preclusion period due to special circumstances.

Mr Jaghuri’s health and personal circumstances

4.      It is not in dispute that Mr Jaghuri suffers from a medical condition that prevents him from undertaking physical work of the type he was doing when he was injured.  Furthermore, his illiteracy in English and his other spoken languages prevents him from undertaking work or training that is reading-based.

5.      Mr Jaghuri arrived in Australia by boat in 1999 from Afghanistan, via Indonesia, seeking refugee status.  He was detained in Darwin and granted a temporary protection visa for three years.  He eventually received permanent residence in 2004 and is now an Australian citizen.

6.      Mr Jaghuri is 36 years old, married and has seven surviving children.  The eldest is aged 18 and the youngest are infant twins.  After gaining permanent residency, he sponsored the migration of his wife and five eldest children to Australia.  They arrived in Australia in 2005.  Mr Jaghuri said that after his wife and five children arrived in Australia, she fell pregnant but the baby was still-born.  They did not wish for more children but she again fell pregnant and this time had twins who are now about one year old.  Mrs Jaghuri is a full-time carer of her children and husband.

7.      Prior to the compensation settlement, Mr Jaghuri lived in a rental flat in Dandenong.  Approximately two months after the settlement, he purchased a home in Narre Warren South.  He sold it in 2006 for $275,000.  He then bought a home in Narre Warren North for $310,000.  He and his family still live there.  There is no mortgage.  He signed the contract note for his current home two days before applying for DSP.

8.      Mr Jaghuri said that he had sold his first home because he intended to move to Brisbane after his doctors advised him he would be better off in a warmer climate.  However, his friends told him that Brisbane prices were too high so he did not investigate further.

9.      Mr Jaghuri said that he did not fully understand the impact of the compensation settlement on his future ability to receive social security benefits.  He conceded that his signature acknowledging the warning about the preclusion period was on documents prepared by his solicitor.  Notwithstanding that an interpreter had translated the contents of the documents to him, Mr Jaghuri said that he did not really understand the nature and length of the preclusion period.  He said that if he had known what would happen, he would have kept some money back for private health treatment.  He said that the insurer was still paying for medical treatment relevant to his injury but no other medical needs.

10.     Mr Jaghuri said that as a result of his current financial situation, he cannot access medical specialists in a timely manner.  One of his sons, Medhi, requires speech pathology and he cannot provide him with such treatment privately.  He is also unable to fund driving lessons for his daughter.  Mr Jaghuri has been on the public waiting list to see a gastric specialist.

11.     Letters of support for Mr Jaghuri were provided from those who have assisted him or his family:

·Rachel Hughes, speech pathologist, indicated in a letter dated 5 June 2007 that Medhi is a year nine student who requires speech therapy to improve his fluency.  Ms Hughes stated that initial weekly visits to the clinic are required followed by a maintenance program.  She reported that Mr Jaghuri had indicated that he is unable to financially manage the payments.

·Dr Don C McIntosh, medical practitioner, wrote to the Tribunal on 17 July 2007 at Mr Jaghuri’s request.  Dr McIntosh first saw Mr Jaghuri in October 2002 with chronic lower back pain and sciatica following his workplace injury.  Dr McIntosh stated that Mr Jaghuri underwent surgery in June 2002 but despite the relieving of pressure on the nerve root, Mr Jaghuri continued to suffer pain.  He reported that Mr Jaghuri had several unsuccessful attempts at returning to work on restricted hours and duties.  Dr McIntosh stated that the medication Mr Jaghuri has required has led to gastric-related pain.  Dr McIntosh indicated that Mr Jaghuri is unlikely to return to work in the future.  Dr McIntosh asked that special consideration be given to his situation in terms of financial assistance to help Mr Jaghuri support his family.

Mr Jaghuri’s financial circumstances

12.     Mr Jaghuri owns his home in Narre Warren North outright.  It was purchased for $310,000 in 2006.   Before buying his current home, Mr Jaghuri sold the house in Narre Warren South that he had purchased some two months after receiving his compensation.  He bought the first house for $258,000 and sold it for $275,000.

13.     Although the compensation settlement included payment of some costs, Mr Jaghuri was required to pay further legal expenses of some $25,000.  Apart from the houses he purchased and the accompanying stamp duty and title registration, Mr Jaghuri spent around $17,500 for visas, legal and travel costs for his family to migrate to Australia; $8,600 for a car; $999 on furniture; and reimbursed Centrelink $2,105.22 for social security payments.

14.     In a schedule provided to Centrelink in September 2006, Mr Jaghuri set out yearly expenses such as council rates ($1,200), car registration ($504.40) and house insurance ($295.61).  There were also utility costs, telephone, car repairs etc.  Food amounted to about $400 per week.  In addition, there were travel and school expenses, clothing and the like.  Documents accompanying the schedule included a Contract Note which indicates that Mr Jaghuri entered into the purchase of the Narre Warren North home two days before he applied for DSP.  Mr Jaghuri applied for DSP primarily on the basis of financial hardship.  A Commonwealth Bank account in Mr Jaghuri’s name as at 7 September 2006 shows a balance of $56.50.  The payments made to Mrs Jaghuri are paid into a different bank account in her name.

15.     Mr and Mrs Jaghuri and their children rely on Mrs Jaghuri’s parenting payments and family tax benefit payments to live on.  The two eldest children are now being paid youth allowance.  The eldest child, still a student, manages her own payments and the second child’s payments are paid into his mother’s account.  Mr Jaghuri did not know how much money was received into the household fortnightly.  He told the Tribunal that his wife managed all their financial transactions.  He has not asked a bank or financial institution if they can take out a small mortgage or loan on their home.  He has not considered selling the home as he needs security for his family.

16.     Mr de Uray, Centrelink’s advocate, provided documentation at the hearing which showed that Mrs Jaghuri receives carer payment, carer allowance, parenting payment and family tax benefit with the fortnightly income at the end of December 2007 of $1,385.88.  There has also been a maternity payment of $8,000 in relation to the birth of the twins.  Mr Jaghuri’s eldest daughter is paid $220 per fortnight.

Consideration of the issues

17. Section 17(1) of the Social Security Act 1991 (the Act) provides that compensation affected payment includes DSP. Section 17(2) of the Act provides:

Subject to subsection (2B), for the purposes of this Act, compensation means:

(a)   a payment of damages; or

(b)   a payment 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)   a payment (with or without admission of liability) in settlement of a claim for damages or a claim under such an insurance scheme; or

(d)   any other compensation or damages payment;

(whether the payment is in the form of a lump sum or in the form of a series of periodic payments and whether it is made within or outside Australia) that is made wholly or partly in respect of lost earnings or lost capacity to earn resulting from personal injury.

18. Under s 17(3) of the Act, 50 per cent of a lump sum settlement payment is held to be the compensation part of the payment. Section 1170 of the Act sets out the method of calculating a compensation preclusion period. There is no dispute between the parties or any evidence before the Tribunal that the lump sum compensation paid to Mr Jaghuri should not result in a preclusion period. Nor is there any evidence to suggest that the original calculation was contrary to the relevant legislative provisions. Mr Jaghuri has suggested that he was not aware of the preclusion period but there are documents prepared both before and after the compensation award which indicate the contrary including acknowledgement by Mr Jaghuri that an interpreter had explained the preclusion period and its length to him prior to the signing of the settlement.

19. Section 1184K(1) of the Act gives the decision‑maker discretion to treat the whole or part of a compensation payment as not having been made or not liable to be made, if the decision‑maker thinks it is appropriate to do so in the special circumstances of the case.

20. For the Tribunal to use the discretion provided in s 1184K it must be satisfied that there is something to make the case stand out from the usual or the ordinary. The term special circumstances is not defined in the legislation.  It has been discussed in many court cases where it has generally been defined as requiring a departure from the norm.  In Ryde v Secretary, Department of Family and Community Services [2005] FCA 866 Branson J stated at paragraph 26 that the circumstances of a particular case must give rise to hardship or unfairness sufficient to justify departure from the general rule.

21.     Special circumstances need to be considered on a case by case basis and in considering this concept the Tribunal must maintain a balance between the circumstances and difficulties of the individual involved and the purpose of the legislative provision.

22.     Mr Jaghuri had been informed more than once about the length of the preclusion period and the need for the compensation award to provide him with income for the duration of the preclusion period.  He was renting at the time of the compensation settlement.  He is now the owner of an unmortgaged property.  While the Tribunal is sympathetic to his desire for security, it nonetheless notes that he holds an asset which could be partly or wholly liquidated to meet his living expenses.  It is uncertain whether Mr Jaghuri would satisfy the requirements of DSP in relation to achieving the relevant points score but given Dr McIntosh’s letter and the nature of his injuries, he may well do so.

23.     The Tribunal accepts that Mr Jaghuri has multiple medical problems which he will continue to face for the foreseeable future.  In relation to Mr Jaghuri’s financial situation, the Tribunal accepts that he and his dependents are on a limited income.  He, his wife and his children rely on social security benefits payable to Mrs Jaghuri in respect of herself and the children.  While he has not received income since the compensation settlement, Mr Jaghuri is in a much better financial situation in terms of his assets than he was before the settlement.  Prior to the compensation settlement, Mr Jaghuri was in a rented flat.  He and his family are now in a house which was purchased in 2006 for $310,000.  They own it outright with no mortgage payments.  Given the property boom in recent years, the house may well now be worth more.  It was his choice to invest the proceeds of settlement into a mortgage free asset.  Furthermore, he and his family are not without income albeit limited.

24.     After considering all relevant matters and viewing Mr Jaghuri’s case in its entirety, the Tribunal is not satisfied that his circumstances, though difficult, should be considered as special circumstances which would warrant a shortening of the preclusion period. Therefore, it is not appropriate for the Tribunal to exercise the discretion under s 1184K(1) of the Act to disregard the compensation received in whole or in part. As a result, Mr Jaghuri does not qualify for DSP for the entire preclusion period as calculated, namely 3 December 2004 to 24 June 2010.

DECISION

25.     The Tribunal affirms the decision under review.

I certify that the twenty-five [25] preceding paragraphs are a true copy of the reasons for the decision of:

Regina Perton, Member

(sgd)       Lauren Spragg

Clerk

Date of hearing:  18 December 2007
Date of decision:  8 January 2008
Advocate for applicant:                Self represented
Advocate for respondent:            Mr T de Uray, Centrelink Legal Services