Jia and Secretary, Department of Social Services - [2017] AATA 1593

Jia and Secretary, Department of Social Services [2017] AATA 1593 (23 August 2017)
Division:GENERAL DIVISION
File Number(s): 2017/3137
Re:Hong Jia
APPLICANT

AndSecretary, Department of Social Services
RESPONDENT

DECISION
Tribunal:Deputy President Dr C Kendall
Date:23 August 2017
Date of written reasons: 28 September 2017
Place:Perth

The Tribunal has jurisdiction to review afresh all aspects of the decision for which the Applicant has lodged an application for review.
.........[sgd]..........................................
Deputy President Dr C Kendall
CATCHWORDS
PRACTICE AND PROCEDURE – jurisdiction – power to review entire decision afresh – decision under review to be heard afresh
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) – ss 25, 43(1), (2A) and (6)
Social Security (Administration) Act 1999 – s 179(1) and (2)
CASES
Aslandidis and Secretary, Department of Families, Housing and Community Services and Indigenous Affairs [2010] AATA 429
Cloros and Secretary, Department of Social Services [2014] AATA 300
Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1
Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60; 24 ALR 577
Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (1963) 113 CLR 475; [1963] HCA 41
Otter Gold Mines Ltd v Australian Securities Commission [1997] FCA 1199
Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Visi [2013] AATA 291
Secretary, Department of Family and Community Services and Owen [2002] AATA 1202
Secretary, Department of Social Security v Hodgson (1992) 108 ALR 322
Secretary, Department of Social Security v Sevel and O’Connell (1992) 38 FCR 540; 28 ALD 626; (1992) 110 ALR 627
Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31
REASONS FOR DECISION
Deputy President Dr C Kendall
28 September 2017
BACKGROUND

On 20 January 2016, an officer of the Department of Human Services (“the Department”) determined that Ms Jia, the Applicant in these proceedings, had a legally recoverable debt due to the overpayment of Disability Services Pension (“DSP”) during the period 3 January 2012 to 16 April 2015 in the sum of $48,779.06 (T46 at 677).
On 6 July 2016, this decision was affirmed on internal review by an Authorised Review Officer (the “ARO”) (T32 at 522-525).
On 18 August 2016, after Ms Jia lodged further documentary material, the ARO wrote to her declining to reconsider his decision (T35 at 531).
On 24 October 2016, Ms Jia applied to the Social Security and Child Support Division (SSCS Division) of the Administrative Appeals Tribunal (“the Tribunal”) for a first tier review of the ARO’s decision (T36 at 534).
The SSCS Division of the Tribunal heard the first tier review on 15 February 2017. On 1 March 2017, after requesting further information from the Department, the SSCS Division made a decision (T2 at 12). That decision set aside the decision under review and remitted the matter back to reconsideration with directions, as follows:
The decision under review is set aside and substituted with the following decision:
The overpayment of DSP is to be recalculated in accordance with the tribunal’s findings at paragraph 23 of these Reasons. Any recalculated amount which results in an overpayment is a debt that is to be fully recovered.
On 9 May 2017, the Department made a decision in accordance with the first tier review directions that, for the period 23 March 2013 to 16 April 2016, Ms Jia a legally recoverable debt due to the overpayment of DSP in the amount of $13,884.85 (T1 at 8).
On 29 May 2017, Ms Jia applied to the Tribunal for a second tier review in the Tribunal’s General Division (T1 at 1). While she agreed with the SSCS Division’s decision generally, she disputed the direction in relation to the calculation of the debt owing.
Before the General Division could conduct a second tier review, this matter was set down for an interlocutory hearing on 23 August 2017 to determine whether Tribunal had jurisdiction to hear Ms Jia’s application de novo.
At the interlocutory hearing, both parties agreed that the Tribunal did have jurisdiction to hear Ms Jia’s application and that this review should include all issues and aspects of the tier one decision. The Tribunal agreed, guided substantially by thorough and well written submissions prepared by counsel for the Secretary dated 28 July 2017, with which Ms Gia agreed. The parties were notified orally of that decision on the same day.
Despite being advised orally of its decision and despite both parties agreeing with the Tribunal’s ultimate decision, in an email received by the Tribunal on 4 September 2017, counsel for the Secretary requested written reasons for the oral decision of 23 August 2017. This request was made pursuant to ss 43(2A) of the Administrative Appeals Tribunal Act 1975 (“the Act”).
The written reasons that follow accommodate that request.
ISSUE
In this case, Ms Jia states that she agrees with the decision of the Tribunal on first review but disputes the new debt amount arrived at by the Department after they recalculated her entitlement as per the Tribunal’s decision (T1 at 4, 6, and 10).
As agreed by the parties, the Tribunal is asked to determine whether the jurisdiction of the Tribunal on second review to review the directions made by the Tribunal on first review limits the power of the Tribunal to decide the entire matter afresh. Broadly, the Tribunal is asked to determine whether it can hear this matter de novo or whether its review powers are limited.
As noted, both parties agreed that the Tribunal on second review does indeed have the jurisdiction to hear the entire matter afresh.
LEGISLATION
The Tribunal has no inherent power to review administrative decisions. The Tribunal only has jurisdiction to review decisions specified as reviewable by the Tribunal in a Commonwealth Act. The Tribunal’s jurisdiction is conferred by s 25 of the Act, which relevantly provides:
(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.
…
(3) Where an enactment makes provision in accordance with subsection (1) or (2), that enactment:
(a) shall specify the person or persons to whose decision is the provision applies;
(b) may be expressed to apply to all decisions of the person, or to a class of such decision; and
(c) may specify conditions subject to which applications may be made.
Section 43 (1) of the Act relevantly provides:
(1) For the purpose of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision…
Section 43(6) of the Act provides:
(6) A decision of a person as varied by the Tribunal, or a decision made by the Tribunal in substitution for the decision of a person, shall, for all purposes (other than the purposes of applications to the Tribunal for a review or of appeals in accordance with section 44), be deemed to be a decision of that person and, upon the coming into operation of the decision of the Tribunal, unless the Tribunal otherwise orders, has effect, or shall be deemed to have had effect, on and from the day on which the decision under review has or had effect.
In this case, the enactment conferring jurisdiction on the Tribunal in relation to social security law is the Social Security (Administration) Act 1999 (“the Administration Act”). Section 179 of the Administration Act provides:
(1)Application may be made to the AAT for review (AAT second review) of a decision of the AAT on AAT first review made under subsection 43(1) of the AAT Act.
(2)For the purposes of subsection (1), the decision of the AAT on AAT first review is taken to be:
(a)if an AAT first review affirms a decision—that decision as affirmed; or
(b) if an AAT first review varies a decision—that decision as varied; or
(c)if an AAT first review sets a decision aside and substitutes a new decision—the new decision; or
(d)if an AAT first review sets a decision aside and sends the matter back to the Secretary for reconsideration in accordance with any directions or recommendations of the AAT—the directions or recommendations of the AAT.
TRIBUNAL’S JURISDICTION
Ms Jia’s application seeks review of a decision of the Tribunal validly made on first review. This satisfies s 179(1) of the Administration Act.
Accordingly, the Tribunal finds that it has jurisdiction in these proceedings.
Having determined that the Tribunal has jurisdiction, the next question is whether s 179(2) of the Administration Act limits the Tribunal’s jurisdiction.
Scope of Tribunal’s jurisdiction
The Tribunal notes the submissions made by the Secretary in a Statement of Facts, Issues and Contentions dated 28 July 2017. The clarity of the submissions received greatly assisted the Tribunal and Ms Jia in understanding and applying this area of the law when coming to its decision.
The Tribunals notes, in particular, the submissions provided at paragraphs 16 to 22, as follows:
16.In such a case, s 179(2)(d) of the Administration Act provides that the decision under review is “taken to be ... the directions or recommendations” of the Tribunal on first review. In previous matters such as Owen,[1] Aslandidis[2] and Visi,[3] this provision was interpreted as limiting the Tribunal’s jurisdiction to reviewing the directions and recommendations made on first review. On this view, the Tribunal may be prevented from conducting full merits review of the matter which it considered and determined on first review.
[1] Secretary, Department of Family and Community Services and Owen [2002] AATA 1202
[2] Aslandidis and Secretary, Department of Families, Housing and Community Services and Indigenous Affairs [2010] AATA 429
[3] Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Visi [2013] AATA 291
17.In the present matter, the applicant states that she agrees with the decision of the Tribunal on first review but disputes the new debt amount arrived at by the respondent after recalculating her entitlement in accordance with the Tribunal’s decision (T1, pp 4, 6, 10). In the matter of Cloros, Senior Member Manetta considered that review of a recalculated debt amount was outside of the Tribunal’s jurisdiction in the same circumstances.[4]
[4] Cloros and Secretary, Department of Social Services [2014] AATA 300 [24]
18.The Secretary respectfully disagrees with the interpretation of s 179(2)(d) of the Administration Act in those matters. The Secretary submits that the provision in question does no more than clarify the decision under review. Were it not enacted, there might be doubt as to whether there was a decision before the Tribunal. However, it should not be taken to limit the jurisdiction of the Tribunal, its powers or the decision it can make.
19.The Tribunal is empowered by AAT Act s 43(1) to exercise all the discretions and powers that were conferred on the decision-maker below, in this case the Tribunal on first review. The Tribunal steps into its shoes,[5] assumes its function[6] and proceeds de novo[7] to determine the correct or preferable decision[8] on the present state of the evidence.[9] Put simply, Tribunal [sic] on second review is to “do over again”[10] what it did on first review. The de novo merits review that is required to be undertaken may be contrasted with a review confined to the directions or recommendations of the Tribunal on first review.
[5] Secretary, Department of Social Security v Sevel and O’Connell (1992) 38 FCR 540; 28 ALD 626, 635; (1992) 110 ALR 627, 637
[6] Eg, Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31 [134], [140] (Kiefel J).
[7] Otter Gold Mines Ltd v Australian Securities Commission [1997] FCA 1199 per Merkel J
[8] Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60, 68; 24 ALR 577, 589 (Bowen CJ and Deane J).
[9] Shi v Migration Agents Registration Authority (2008) 235 CLR 286, 315; [2008] HCA 31 [99] (Hayne and Heydon JJ).
[10] Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (1963) 113 CLR 475, 502; [1963] HCA 41 [12] (Kitto J); Shi v Migration Agents Registration Authority (2008) 235 CLR 286, 315; [2008] HCA 31 [100] (Hayne and Heydon JJ).
20. In Secretary, Department of Social Security v Hodgson, Hill J stated:[11]
[11] (1992) 108 ALR 322, 330
The language of s 43 is quite clear and unambiguous. It empowers the Tribunal to exercise all the powers and discretions conferred upon the original decision-maker provided it does so for the purpose of reviewing a decision. Provided the necessary purpose is present, the power conferred upon the Tribunal is not otherwise limited ...
Of course there must be an association between the power to be exercised by the Tribunal and the decision under review, but that association is to be found in the restriction of the grant of power in s 43(1) to the purpose of the Tribunal’s review. The test is one of relevance rather than dependence. Where the exercise of power or discretion is relevant to the making of the decision under review then, if requested, the Tribunal may exercise the discretion.
21.Further, in considering what is reviewable by the Tribunal, Bowen CJ observed in Collector of Customs v Brian Lawlor Automotive Pty Ltd that:[12]
The Act clearly intended to give a person whose interest are affected by an administrative decision an effective appeal, free of technicalities, against that decision on questions of fact and law ... It is a feature of administrative decision that once made, even if unlawful, they have consequences which may adversely affect citizens, until such time as they are withdrawn due to a change of mind on the part of the administrative official himself or are set aside by the determination of a court or tribunal. It appears to me that the Act is designed to give a simple remedy in all such cases.
22.The Secretary submits that the decision under review should be taken to include the debt as recalculated according to the first review decision. The amount of the debt is relevant in considering the application of non-recovery provisions in Part 5.4 of the Social Security Act 1991 and is also the aspect of the matter which aggrieves the applicant and motivates her to seek review. By assuming the function of the Tribunal on first review, the Tribunal on second review is able to provide a simple remedy by determining all substantive issues.
[Emphasis added]
[12] Collector of Customs v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1, 4-5; 24 ALR 307, 314 (emphasis added).
The Department further submitted that a narrow interpretation of s 179(2)(d) of the Administration Act is inconsistent with the function of the Tribunal and that the decision under review should be taken to include the debt as recalculated according to the first review decision.
CONSIDERATION
The Tribunal agrees with the Department’s submissions above and notes that they are consistent with the powers, role and purpose of the Tribunal long recognized as central to the Tribunal’s mandate.
Previous interpretations of s 179(2)(d) of the Administration Act have had the effect of limiting the Tribunal’s jurisdiction to reviewing the directions and recommendations made on first review. The Tribunal rejects this approach as it pertains to Ms Jia.
The Tribunal’s decision on first review required the Secretary to reassess Ms Jia’s eligibility to DSP using different documentation and then raise any resultant overpayment, whatever the amount, as a legally recoverable debt. It is clear that the Tribunal’s decision was to remit the matter for reconsideration with directions.
In this matter, a narrow interpretation of s 179(2)(d) of the Administration Act might preclude the Tribunal from setting aside the first review decision and substituting another decision in its place, notwithstanding that it might reach the conclusion that the decision on first review was not the correct or preferable one. This would defeat the core objectives of the Tribunal on review.
A full reconsideration of the first review is an inherent aspect of merits review and the Tribunal is of the opinion that a narrow interpretation of s 179(2)(d) of the Administration Act is inconsistent with its broad functions. The Tribunal considers that a broad interpretation of s 179(2)(d) of the Administration Act is both logical and preferable. It allows the Tribunal to do what it was always intended to do --- determine all of the substantive issues before it.
Having regard to the above, the Tribunal concludes that a second review by the Tribunal in relation to Ms Jia’s application is statutorily sound and can and should include a review of all aspects of the Tribunal’s decision at first review.
DECISION
The Tribunal has jurisdiction to review afresh the decision for which the Applicant has lodged an application for review.

I certify that the preceding 31 (thirty-one) paragraphs are a true copy of the reasons for the decision herein of Deputy President Dr C Kendall

..........[sgd]...................................................
Administrative Assistant – Legal
Dated: 28 September 2017

Date(s) of hearing: 23 August 2017

Respondent: In person

Representative for the Respondent: Mr J Tsianikas

Date(s) of hearing:	23 August 2017
Respondent:	In person
Representative for the Respondent:	Mr J Tsianikas