JOSEPH CRNOGORAC and SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

[2009] AATA 810

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 810

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2009/0138

GENERAL  ADMINISTRATION  DIVISION		)
Re		JOSEPH CRNOGORAC

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS  and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondents

DECISION

Tribunal Mr B H Pascoe, Senior Member  

Date22 October 2009

PlaceMelbourne

Decision The Tribunal affirms the decision under review.

(sgd) BH Pascoe

Senior Member

SOCIAL SECURITY – debt for overpayment – ownership of real estate – assets not declared – debt cannot be written off nor waived

Social Security Act 1991

REASONS FOR DECISION

22 October 2009 Mr B H Pascoe, Senior Member  

1.      This is an application to review a decision of the Social Security Appeals Tribunal (SSAT) of 2 December 2008 which affirmed a decision of the respondents to raise and recover a newstart allowance debt of $2,916.30 for the period 11 March 2004 to 23 June 2004 and a disability support pension debt of $47,797.13 for the period 24 June 2004 to 31 March 2008. 

2.      At the hearing the applicant, Mr J Crnogorac was unrepresented.  The respondents were represented by Ms H Weston, a solicitor.

3.      The decision of the respondent to raise and recover the debts was made after it was ascertained that Mr Crnogorac owned two real estate properties which he had failed to disclose to Centrelink at the time of claiming newstart allowance in December 2003 and disability support pension in June 2004 nor at any subsequent time.  The properties are at 50 Dover Street, St Albans and 4/30 Eldridge Road, Footscray.  Valuations of these two properties were obtained from the Australian Valuation Office as follows:

Valuation Date	50 Dover Street	4/30 Eldridge Road
1 January 2004	215,000	155,000
1 January 2005	225,000	160,000
1 January 2006	235,000	170,000
1 January 2007	240,000	175,000
11 April 2008	245,000	-
26 June 2008	-	230,000

4.      In addition Mr Crnogorac owns a part equity in a property at 1 Summit Rise, Maribyrnong.  As this was his principal residence until April 2008 it was exempt from the assets test prior to that date.  The only relevance of this property in relation to the decision under review is in respect of the credibility of Mr Crnogorac.  In a form headed Real Estate Details “signed by him on 31 March 2008, it is not clear but appears to say that he owns 50 per cent of the property.  The SSAT recorded his evidence of owning the property with two others.  Before this Tribunal, he said that he owns 25 per cent of the property, still owes $80,000 and has no idea of the value which he stated in the Real Estate Details form as $250,000.

5.      Mr Crnogorac said that he had a loan from Westpac secured against the property at 4/30 Eldridge Street.  A copy of a Westpac Home Loan account showing an outstanding balance of $12,324.97 at 30 April 2008 was produced.  No information is available as to the balance at any prior period.  Mr Crnogorac said that he borrowed money from a friend to assist in the purchase of 50 Dover Street.  He had produced a letter from a Mr I Vidovic addressed to whom it may concern stating that there was a personal loan of $100,000 against the property of 50 Dover Street.  In his evidence to the SSAT, Mr Crnogorac said that $80,000 was still outstanding.  However, there was no evidence of any charge or encumbrance over the property nor any formal evidence of the status of this loan.

6.      Mr Crnogorac maintained that Centrelink had always known of his assets and the loans against them.  However, it is quite clear that ownership of the two properties was not disclosed in the application for newstart allowance or the application for disability support pension.  Nor was any disclosure made in response to the regular notices sent to him reminding of the need to notify Centrelink of the ownership of assets.  Mr Crnogorac said that he had difficulty with English and may not have properly understood the questions.  He said that his intention was to sell the properties when the market improves so that he can pay off his debts and have sufficient funds to acquire a residence.  He maintained that he is unable to live on the modest amount of rent he receives.

7.      It is clear that the value of the assets owned by Mr Crnogorac during the relevant periods exceeded the limits imposed under the Social Security Act 1991 (theAct).  As a consequence, he was not entitled to the benefits paid to him and he has a debt due to the Commonwealth pursuant to s 1223 of the Act.  Mr Crnogorac did not dispute the valuations of the properties.

8.      There is no basis for the waiver of the debt pursuant to s 1237A of the Act or for it to be written off pursuant to s 1236.  There is no evidence of any administrative error made by the Commonwealth nor that Mr Crnogorac has no capacity to repay the debt.  Section 1237AAD provides for the waiver of a debt where there are special circumstances (other than financial hardship alone) that make it desirable to waive.  There was no evidence of special circumstances which would justify the exercise of this discretion to waive the debt.

9.      In view of the foregoing, the decision under review should be affirmed.

I certify that the nine [9] preceding paragraphs are a true copy of the reasons for the decision herein of
Mr B H Pascoe, Senior Member

Signed: .   .Dianne Eva
  Clerk

Date of Hearing  15 September 2009
Date of Decision  22 October 2009
Advocate for the Applicant       Self Represented
Solicitor for the Respondent     Ms H Weston, DLA Phillips Fox