Kelly and Anor and Secretary, Department of Family and Community Services

DECISION AND REASONS FOR DECISION [2002] AATA 285

ADMINISTRATIVE APPEALS TRIBUNAL      )        No N2001/76; N2001/77
GENERAL ADMINSTRATIVE DIVISION        )
           Re      YVONNE KELLY
  First Applicant
  MICHAEL FERRARO
  Second Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION

Tribunal Ms N Bell, Member

Date24 April 2002
PlaceTamworth

Decision The Tribunal affirms the decision under review.

[SGD] Ms N Bell
Member
CATCHWORDS
SOCIAL SECURITY – disability support pension – pension rates – application for carer allowance –whether applicants should be treated as members of a couple for the purpose of calculating disability support pension – whether applicants are in a marriage-like relationship – financial aspects – nature of household – social aspects – sexual relationship – nature of commitment

Social Security Act 1991 – section 4

Re Roberts and Secretary, Department of Social Security (1987) 12 ALD 725

REASONS FOR DECISION

Ms N Bell, Member

These are applications by Ms Yvonne Kelly (application N2001/76) and by Mr Michael Ferraro (application N2001/77), the Applicants in these proceedings, for review of the decision of the Social Security Appeals Tribunal ("the SSAT") made on 12 December 2000, which affirmed a decision made by a Centrelink delegate of the Secretary, Department of Family and Community Services ("the Respondent") on 29 April 2000, that Mr Ferraro and Ms Kelly were living in a marriage-like relationship and that their pension rates be changed to the 'married' rate. This earlier decision was reviewed and affirmed by an authorised review officer on 31 May 2000.
A hearing was held before the Tribunal on 7 February 2002 in Tamworth. Both Applicants appeared and provided oral evidence to the Tribunal. Mr Ferraro made submissions on his own behalf and on behalf of Ms Kelly. The Respondent was represented by Ms Schuster, an advocate from the Advocacy and Administrative Law Team at Centrelink.
The following material was placed into evidence before the Tribunal:
Exhibit          Description Date
TD1 pp1-124 Documents prepared pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 in relation to application N2001/76
TD2 pp1-96 Documents prepared pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 in relation to application N2001/77
R1      Respondent's Statement of Facts and Contentions     31 January 2002
R2      Additional document to TD2 – in substitution for document T38

Background

Mr Ferraro and Ms Kelly are both currently in receipt of disability support pension and Ms Kelly is in receipt of carer allowance in respect of Mr Ferraro. For approximately the last 15 years they have shared accommodation in a variety of locations, in privately rented flats in Sydney as well as Department of Housing accommodation. They currently live in a Department of Housing residence in Tamworth.
In September 1999 Mr Ferraro suffered a stroke, was admitted to Tamworth Base Hospital Emergency Department and then transferred to John Hunter Hospital. Subsequent to an inquiry made by Mr Ferraro with Centrelink on 21 December 1999, in relation to Ms Kelly lodging a claim for carer allowance, a review of their relationship was initiated by a Centrelink officer. On 10 January 2000 Ms Kelly lodged a claim for carer allowance, for care provided to Mr Ferraro, and this claim was granted on 12 January 2000.
As a result of further inquiries made in early 2000, in relation to the review of Mr Ferraro and Ms Kelly's relationship and living arrangements, it was determined by a Centrelink officer on 29 April 2000 that they were members of a couple for social security purposes and their rates of disability support pension were reduced from the higher "single rate" to the lower "married rate".
The Applicants sought reviews of this decision and the matter was referred to an authorised review officer who determined, on 31 May 2000, that they were living in a marriage-like relationship and therefore affirmed the decision to regard them as members of a couple. Mr Ferraro and Ms Kelly lodged appeals with the SSAT, which reviewed and affirmed the original decision on 12 December 2000.
Issues and Legislation
The relevant issue in these applications is whether Mr Ferraro and Ms Kelly are living in a marriage-like relationship and should therefore be treated as members of a couple, for the purpose of calculating their respective entitlements to disability support pension under the Social Security Act 1991.
The relevant legislation is the Social Security Act 1991 ("the Act"), particularly section 4 of the Act.
Evidence
mr ferraro's evidence
In his oral evidence to the Tribunal, Mr Ferraro showed a poor recollection of events and dates. He stated that he had met Ms Kelly approximately 13 years ago, through family, and that they started living together about three years later. He stated that he had spent some six months in jail and that upon his release he moved in with Ms Kelly into a two-bedroom Housing Commission accommodation, which she had already applied for. He stated that this was the time they first began sharing accommodation and they have not lived separately since. Mr Ferraro also stated that whilst they shared accommodation in Sydney, Ms Kelly looked after him when he was ill with his asthma and heart condition. He said he felt lucky to have had Ms Kelly look after him when he was ill.
Mr Ferraro stated that he moved to Tamworth about five or six years ago and that he and Ms Kelly currently live in Department of Housing accommodation, being a two bedroom house. In response to a question put to Mr Ferraro by the Tribunal as to why he had moved to Tamworth, the Applicant said that this was due to health reasons, to enjoy more space and cleaner air. He stated that his doctor had recommended a move to the country to aid his asthma. He also said that although he was happy living in a unit in Sydney, he wanted to live in a house in the country. Mr Ferraro did not know anyone in Tamworth when he moved there (other than Ms Kelly who moved with him), but has since made a few friends and occasionally goes to the local club. He stated that he and Ms Kelly only sometimes go out together. He thinks that it was a good decision to move to the country. When asked why Ms Kelly moved to Tamworth with him, Mr Ferraro did not provide an answer, except to say that Ms Kelly's mother lives nearby.
Mr Ferraro stated that he suffered from a stroke in 1999 and was subsequently hospitalised for about three or four months, initially at Tamworth Base Hospital and then at John Hunter Hospital. He stated that Ms Kelly did not accompany him to the hospital and that during his stay in hospital he was visited by Ms Kelly only three or four times, she brought him clothes from home, and that he spoke to her over the phone a couple of times. Mr Ferraro stated that the hospital made a mistake in thinking that Ms Kelly was his wife and that he did not know why they would have made this assumption.
In relation to their household arrangements, Mr Ferraro stated he and Ms Kelly sleep in separate bedrooms, each with their own televisions. In relation to household duties, he stated that Ms Kelly sometimes does his washing, if he is ill, as well as her own and that their groceries are delivered to their home. If he is able to, Mr Ferraro mows the lawn and keeps the house clean. Ms Kelly does most of the cooking and sometimes they eat meals together.
Mr Ferraro stated that he and Ms Kelly share their food costs by halving the shopping bills, and that they halve the Department of Housing rent, which is calculated according to their respective pensions. They also halve any other household bills between them. He said that he owns most of the furniture in the house, although Ms Kelly owns some of the furniture in her bedroom, and that neither of them have any assets.
When asked by the Tribunal how he spends an average day, Mr Ferraro stated that he spends much of his day laying down and reading. He stated that a nurse visits the house to show Ms Kelly how to administer insulin for her diabetes, as Mr Ferraro cannot help her administer it. He does not drive and does not go out very much. Mr Ferraro stated that he is still presently in ill health, suffering from asthma and heart disease.
In cross-examination Mr Ferraro was asked why he and Ms Kelly had provided different addresses to Centrelink at various times throughout their dealings with Centrelink. Mr Ferraro replied that this was an honest mistake. Ms Schuster, for the Respondent, noted during her cross-examination of Mr Ferraro that in January 1987 his living arrangements with Ms Kelly were reviewed by a field officer from Centrelink, in a home visit to their privately rented flat in Drummoyne. Mr Ferraro was referred to the field officer's subsequent report on this home visit, at T4, p14 where it is noted that Mr Ferraro used the words "the wife" in reference to Ms Kelly. In reply to this, Mr Ferraro stated that this "must have been a mistake". At the time of the home visit, the Applicants were sharing accommodation with Ms Kelly's uncle. As a result of this home visit, the Centrelink officer initially decided that the Applicants should be treated as members of a couple, for the purposes of calculating their respective pension entitlements (T6, p18). Ms Schuster put it to Mr Ferraro that since that review he and Ms Kelly had deliberately attempted to mislead the Respondent into thinking that they were not living together by providing different addresses on a number of occasions. To this he replied that it was not deliberate but that the different addresses provided were mistakes.
Mr Ferraro was referred by Ms Schuster to his Application for Housing with the Department of Housing dated 29 March 1985 (at T17, p57), and to his Application for Priority Rehousing dated 15 February 1996 (at T17, p60) where he stated Ms Kelly was his 'defacto' and his 'spouse', respectively. When asked to explain this, Mr Ferraro stated that this was "an honest mistake" and that the officer from the Housing Department, who filled out the forms for the Applicants, suggested that the only way they would get accommodation with two bedrooms would be if they indicated they were in a defacto relationship. Mr Ferraro did not specify if this was in relation to the Application for Housing in 1985 or the Application for Priority Rehousing in 1986. He also said that he realised now that "this was wrong". Mr Ferraro also stated that he has not informed the Department of Housing that he and Ms Kelly are not a couple.
Ms Schuster also referred Mr Ferraro to T11, p25 where it was noted by a Centrelink officer in a file note that Mr Ferraro used the word "wife" in reference to Ms Kelly, when making inquiries relating to the receipt of carer allowance. In his oral evidence before the Tribunal, Mr Ferraro initially denied having said this, but later stated that this may have been "a slip of the tongue" on his part and that if he had said so that he had not meant to.
Mr Ferraro also stated in evidence that Ms Kelly is a beneficiary in his will. In relation to the future, he stated that he could move out on his own and apply for accommodation for himself through the Department of Housing, but would prefer not to as he does not want to break up his friendship with Ms Kelly.
ms kelly's evidence
In her oral evidence, Ms Kelly also showed a poor recollection of events and dates. She stated that she met Mr Ferraro through family about 15 years ago and they first began sharing accommodation in Ashfield about 12 to 14 years ago. She stated that it was approximately two years after Mr Ferraro was released from jail that they started to live together, and that initially they shared private accommodation with Ms Kelly's uncle. After that time Ms Kelly and Mr Ferraro applied for Housing Commission accommodation together. Ms Kelly stated that since first moving in together they have only lived separately once, when Ms Kelly moved to Nelson Bay for six months. On her return to Sydney, she resumed living with Mr Ferraro.
In reply to a question put to her by the Tribunal as to why she decided to move to Tamworth, Ms Kelly said "it was better for me too", stating that she moved for health reasons. She did not provide any specific information in relation to this, except to say that she suffers from diabetes and hepatitis. Ms Kelly did not know anyone (other than Mr Ferraro) when they moved to Tamworth but has since made a few friends. She stated that the only mutual friends she and Mr Ferarro have are their neighbours. She added that she and Mr Ferraro do not socialise together.
Ms Kelly stated that when Mr Ferraro was admitted to Tamworth Base Hospital, she visited him only a couple of times and had to catch two buses to get to the hospital. She could not explain why she was identified by the hospital as his next of kin when he was admitted. Ms Kelly stated that Mr Ferraro was later released from hospital and that she began looking after him as he recovered at home. Ms Schuster, for the Respondent, noted that it was at this time that Mr Ferraro made a telephone inquiry with Centrelink in relation to Ms Kelly lodging an application for carer allowance, for care provided to him. Ms Schuster referred Ms Kelly to the Centrelink file note in relation to this inquiry, which stated "Customer advised his wife would like to apply for CDA". When asked to explain why Mr Ferraro would have referred to her as his wife, Ms Kelly stated that Mr Ferraro, being ill at the time, must have made a mistake and "didn't know what he was saying".
In relation to household duties, Ms Kelly stated that she and Mr Ferraro do their own washing and cooking separately, although she does most of the cleaning around the house. She said that the only time she did Mr Ferraro's washing was when he was ill, and no longer does any of his washing. She stated that they seldom eat meals together. In contradiction to Mr Ferraro's evidence, Ms Kelly said that they never cook meals for each other. Ms Kelly further stated that she does not now do anything for Mr Ferraro in the household.
In relation to living costs, Ms Kelly stated that she and Mr Ferraro evenly split their bills. She stated that they have separate crockery, linen and furniture, although they both share a lounge which Mr Ferraro owns, and both share a table and chairs which Ms Kelly owns.
In cross-examination Ms Kelly was asked why, throughout her dealings with Centrelink, the addresses she had provided had been slightly different to those provided by Mr Ferraro, however she did not answer the question. When referred to the interview conducted by the field officer from Centrelink in January 1987, in relation to her living arrangements with Mr Ferraro, Ms Kelly stated that she did not recall the interview. Ms Kelly was also referred to the applications for housing at T17 where she is noted as being Mr Ferraro's 'defacto' and 'spouse', in response to which she simply stated that the forms were 'a mistake', without elaborating.
In relation to her current health, Ms Kelly stated she is a diabetic and has been taking insulin for six months. With regard to the future, Ms Kelly stated that, being happy with her current living arrangement with Mr Ferraro, she does not want to change this arrangement or have to look for other accommodation.
Other evidence
The Tribunal notes that the material in TD2 (in relation to application N2001/77 – Mr Ferraro) appears in duplicate in the material contained in TD1 (in relation to application N2001/76 – Ms Kelly). Only the relevant material in TD1 which does not appear in TD2 is identified by T-document number as well as application number throughout these reasons for decision.
In his application for accommodation with the Department of Housing dated 29 March 1985 (T17, pp56-57) Mr Ferraro indicated that Ms Kelly was his "defacto wife" and that she had previously lodged an application for housing. At the time the Applicants were living in Ashfield. Mr Ferraro further indicated that neither he nor Ms Kelly had any assets or liabilities.
In January 1987, as a result of a home visit to Mr Ferarro and Ms Kelly, a field officer from Centrelink reported on their living arrangements (T4). At the time the Applicants were living with Ms Kelly's uncle, Mr Broughton, in Drummoyne. The Applicants informed the officer that they had previously shared accommodation in Ashfield, with a third party. In his report, the field officer noted that "both consider their relationship as that of housemates and nothing more", that they claim to share household expenses and to not have any joint accounts or assets. However, he also noted that:
"During the course of the interview Ferraro asked Ms Kelly to get something and became rather angry with her when she was unable to locate it. He then said to me quote [sic] the wife gets confused".

The field officer further noted that:

"They claim that household chores are shared, although Ferraro appears to be somewhat limited in this regard, due to his medical condition. It is of my opinion that Ms Kelly performs the majority of the chores."

In individual statements dated 9 January 1987, both Mr Ferraro and Ms Kelly asserted that they occupy separate bedrooms, do their own cooking and laundry separately, buy separate groceries, do not go out together socially and have never presented themselves as a couple (T4, pp15-16).
In a letter to Mr Ferraro from the Respondent (then the Department of Social Security) dated 20 January 1987 (T6), it was stated that for pension purposes the Applicants would be treated as members of a couple, therefore reducing Mr Ferraro's pension. The same letter was sent to Ms Kelly (T9 – N2001/76) having the same effect on her pension.
The Applicants sought review of the decision of 20 January 1987 and were subsequently interviewed by a review officer on 5 February 1987 who "advised the Applicants that they would be treated as single, pending further investigation into the application lodged at the housing commission in 1984" (T8).
In a further statement by Ms Kelly dated 5 February 1987 (T7) she reiterated much of the detail in her statement of 9 January 1987 (T4), particularly in relation to the separateness of her relationship with Mr Ferraro. However she also stated:
"If Mr Ferraro becomes ill, I can assist him and he would do the same for me. It is a much better arrangement financially than to live by oneself…
Mr Ferraro pays the majority of household bills…
I assist with household chores more than Mr Ferraro due to his injury to his hand…
I pay $55 per week rent and Mr Ferraro pays $80 per week… to Mr Broughton."
In a further letter to the Applicants, dated 23 June 1987, the Respondent stated that the Applicants were in receipt of pensions at the maximum standard "single" rate and that "they have satisfied this Department that they are not in a defacto relationship" (T9).
In his application for accommodation with the Department of Housing dated 15 February 1996 (T17, pp58-64), Mr Ferraro indicated Ms Kelly as his "defacto" and as his "spouse". At the time they were sharing accommodation in Campsie. Mr Ferraro also described his health problems as being "severe hypertension: heart disease, lung asthma" (T17, p62).
On 12 September 1999, Mr Ferraro was admitted to Tamworth Base Hospital emergency, unconscious, after having suffered a stroke, and was later transferred to John Hunter Hospital (documented at T34).
A file note completed by a Centrelink officer on 21 December 1999 (T11), states, in relation to Mr Ferraro:
"Customer requested CDA claim pack for ptnr.
Called 21/12/1999 at 11.19…
Customer advised his wife would like to apply for CDA. Customer is (and always has been) listed as single…"

On the same day, 21 December 1999, "Telephone Lodgement of claim for: CDA Carers 16 and over" was recorded in a file note (T12).

A Health Professional Assessment was completed by Dr Campbell-Smith on 7 January 2000 in respect of Mr Ferraro (T16 – N2001/76). He stated that Mr Ferraro has a physical disability; his current care needs are attributable to an acute event; his disability results in the need for care on a daily basis; his condition is unlikely to improve; a cerebrovascular accident – hemiplegia, caused his current disability; he needs some help with toilet use; needs some help with walking, dressing, taking stairs; and sometimes shows signs of depression and withdrawal from social contact.
Ms Kelly lodged an application for carer allowance in respect of Mr Ferraro on 10 January 2000 (T14 – N2001/76). In this application she indicated that she was divorced; she lives with the person she cares for, that is Mr Ferraro; his main disabilities are asthma, blood pressure and heart disease; she provides him with care on a daily basis and that he first came into her care on 7 December 1999. She also provided details of the daily care needs of Mr Ferraro and the type of care she provides for him. Ms Kelly's claim for carer allowance was granted on 12 January 2000 (T17 – N2001/76).
In a Centrelink file note regarding Mr Ferraro, dated 18 January 2000 it was stated that (T13):
"Yvonne Kelly recently granted CDA (adult) caring for Michael Ferraro… Client stated Yvonne Ferraro as his wife, that they are married!!…"
A Centrelink "Assessment of living arrangements" form was completed by Mr Ferraro on 27 January 2000, with the assistance of a Social Worker from the Tamworth Base Hospital (T15). In this form he stated that Ms Kelly is not married to or living de facto with anyone else in the household; he has lived with Ms Kelly at Bruce St Tamworth continuously since 1995; they have separate bedrooms but shared common areas; neither of them own a car(s); they have not purchased any major items together; they do not have any joint bank accounts, investments, credit cards, debts or insurance policies; they have not nominated each other as beneficiaries under each other's wills; they share the payment of bills, food and household items equally; they do not share social and leisure activities; their relatives and friends do not consider their relationship to be similar to that of a married couple; they do not have a sexual relationship and have not claimed being married or a de facto couple for any purpose. He also indicated that he has never been legally married to or lived as if married (de facto) with Ms Kelly. Mr Ferraro indicated that Ms Kelly takes care of him when he is ill, runs errands for him and provides him with emotional support. Mr Ferraro described his relationship with Ms Kelly as one of "ongoing friendship which has developed into a care and support" while he is ill and unable to do many tasks for himself.
A Centrelink "Assessment of living arrangements" form was also completed by Ms Kelly on 17 February 2000 (T16). In this form she stated that Mr Ferraro was not married to or living de facto with anyone else in the household; she has lived with Mr Ferarro at Bruce St Tamworth continuously since October 1996; she has a separate bedroom to Mr Ferraro; they do not have any joint bank accounts, investments, credit cards, debts or insurance policies; they have not nominated each other as beneficiaries under each other's wills; they share the payment of bills, food and household items equally; they do share social and leisure activities; their relatives and friends do not consider their relationship as similar to that of a married couple; they do not have a sexual relationship and have not claimed being married or a de facto couple for any purpose. However, in response to the question "Have you ever been legally married to or lived as if married (de facto) with [Mr Ferraro]" Ms Kelly answered "Yes" without providing details. She also indicated that Mr Ferraro provides care and support to her in the circumstances of "illness". Ms Kelly further described her relationship with Mr Ferraro as that of "good friends".
In response to questions put by Centrelink, the Department of Housing stated by letter of 28 January 2000 that Mr Ferraro is living in a Department of Housing residence at 15 Bruce Street Tamworth with his "partner", "Mrs Yvonne Ferraro (wife)" (T14). In response to further questions put by Centrelink, the Department of Housing stated on 25 February 2000 that Mr Ferraro and Ms Kelly have lived in three Department of Housing residences as "partners" since 1987, in Riverwood, Campsie and currently in Tamworth (T17, pp54-55). It was noted that the Department of Housing was first aware of their relationship as partners in March 1985.
In response to a request by Centrelink, Tamworth Base Hospital reported on 24 February 2000, according to their medical records, that Ms Kelly was Mr Ferraro's next of kin or emergency contact and that her relationship to Mr Ferraro was that of "wife" (T18).
A Centrelink officer decided on 29 April 2000, on the basis of an interview conducted with the Applicants on 26 April 2000 and the information provided by the Department of Housing and Tamworth Base Hospital, that the Applicants are living in a marriage-like relationship (T20). The Centrelink officer stated that:
"He [Mr Ferraro] said that neither of them have each other as beneficiaries, but she said that she has him as her beneficiary. She thinks she is the beneficiary of his will…
There is definitely a caring role by her, she used to wash him, but now he is better she only need to set up his shower and be nearby in case he needs her…"

Mr Ferraro requested a review of this decision on the same day (T22).

Mr Ferraro, in a statutory declaration dated 29 May 2000 (T29), maintained his previous statements pertaining to the separate nature of his relationship, that is, that they sleep in separate bedrooms, do not have a sexual relationship and split all household bills between them. He asserted that his relationship with Ms Kelly is one of friendship.
On 31 May 2000 an authorised review officer reviewed and affirmed the decision to regard Ms Kelly and Mr Ferraro as living in a marriage-like relationship (T31).
In response to a request by Centrelink, John Hunter Hospital informed Centrelink, on 5 June 2000, that the next of kin or emergency contact for Mr Ferraro is his "wife" "Yvonne Ferraro" and that they are married (T33).
In a letter dated 10 August 2000 from New England Area Health, in relation to the occasion when Mr Ferraro was admitted to Tamworth Base Hospital after having suffered a stroke, it was stated (T34):
"On presentation to Tamworth Base Hospital Mr Michael Ferraro was unable to give details to the Emergency Department Clerk. The Clerk was told the next of kin was Yvonne at the same address and presumed Yvonne was his wife.
Mr Michael Ferraro has requested we change his next of kin to his brother at Five Dock."
In a letter from New England Health to Ms Kelly, dated 12 December 2000, Ms Kelly was advised that (T35):
"the 'Next of Kin' details originally provided by yourself on your first visit to the Diabetes Centre as Mr Michael Ferraro (friend) have been changed as per your request to: Mr Joe Davis… South Granville."
On 12 December 2000, the SSAT affirmed the decision under review. Upon consideration of all the aspects of their relationship, the SSAT determined that the Applicants are in a marriage-like relationship (T2).
Submissions
Mr Ferarro made very brief submissions on his behalf and on behalf of Ms Kelly. In his opening remarks, and in response to the Tribunal's question as to why he and Ms Kelly disagreed with the decision under review, Mr Ferraro stated they have never been a couple. He said that the only reason they have lived together, and continue to live together, is because it is much cheaper than living alone. Mr Ferraro submitted that his relationship with Ms Kelly is merely a friendship of convenience.
Ms Schuster for the Respondent, submitted that Mr Ferraro and Ms Kelly are members of a couple for the purpose of calculating their respective entitlements under the Act. She submitted that although the Applicants have separate bedrooms in the house they currently share, there is little evidence to support the assertion that their arrangements are separate. It was contended that even if the separateness of their sleeping arrangements is accepted by the Tribunal, this should not be given substantial weight given the existence of other aspects of their relationship such as its long-standing nature and the continued support they offer each other.
The Respondent submitted that given the length of the Applicants' cohabitation, they have an entrenched long-term relationship with many shared responsibilities and commonalities. The Respondent noted that the Applicants' financial arrangements, such as sharing costs of rent and household expenses, appear to be split evenly. It was also noted that Mr Ferraro's evidence was that he and Ms Kelly occasionally socialise together, that Ms Kelly does most of the housework and that they sometimes share meals together (while observing Ms Kelly's diabetic diet). The Respondent further contended that Ms Kelly contradicted Mr Ferraro's evidence before the Tribunal, in stating that she never does anything for Mr Ferraro in the household and that they never cook meals for each other, in an effort to portray a lower level of commitment and cooperation in their relationship than in truth exists.
The Respondent submitted that there is very little to indicate the separateness of their relationship, especially given the level of care and commitment demonstrated by both Mr Ferraro and Ms Kelly for each other, over the length of their relationship. It was submitted that the decision to move to Tamworth from Sydney appears a significant lifestyle decision which was made jointly by the Applicants. In the Respondent's submission this is strong evidence that their relationship is more than a mere friendship of convenience. Moreover, it was submitted by the Respondent that the absence of a sexual relationship, while impossible to verify, is not as relevant as other considerations as it does not necessarily indicate that the relationship in not marriage-like in nature.
As to the Applicants holding themselves out to others to be in a marriage-like relationship, the Respondent pointed to the evidence available in the T-documents. In particular, the Respondent noted the two applications to the Department of Housing signed by the Applicants, in 1985 and 1996, which refer to Ms Kelly as Mr Ferraro's "defacto" wife and "spouse", respectively. The Respondent also pointed to the instances when Centrelink officers had noted Mr Ferarro referring to Ms Kelly as his "wife" (T4, T5 and T11). In relation to the Centrelink file note at T11, Ms Schuster submitted that, there being no connection or prior communication between the Centrelink call centre officer and Mr Ferarro, there was no reason for the officer to assume that Mr Ferraro was referring to his "wife", and that therefore his file note merely reflects what Mr Ferraro had actually stated to the officer. Thus it was submitted that the Applicants have on many occasions held themselves out as being in a marriage-like relationship.
Ms Schuster further submitted that as Mr Ferraro and Ms Kelly have both expressed no intention to live separately in the future, this indicates a strong commitment between the Applicants. Further, as each other's "next of kin" for the purposes of hospital notification, and given the significant amount of care Ms Kelly provided to Mr Ferraro during his convalescence at home after he had suffered the stroke, the Respondent submitted that they have demonstrated a high level of emotional support for each other and indicated a commitment to each other's welfare. It was submitted that Mr Ferraro and Ms Kelly have not just shared accommodation for convenience sake, but have actively sought to live together in various places for over 15 years, and that overall there is every indication that they live in a "marriage-like" relationship.
Consideration and Findings
The relevant issue in these applications is whether Mr Ferraro and Ms Kelly are in a marriage-like relationship and should therefore be treated as members of a couple, for the purpose of calculating their respective entitlements under the Act. Section 4(2) of the Act relevantly provides:
"…
Member of a couple—general
4(2) Subject to subsection (3), a person is a member of a couple for the purposes of this Act if:
(a) the person is legally married to another person and is not, in the Secretary's opinion (formed as mentioned in subsection (3)), living separately and apart from the other person on a permanent or indefinite basis; or
(b) all of the following conditions are met:
(i) the person has a relationship with a person of the opposite sex (in this paragraph called the partner);
(ii) the person is not legally married to the partner;
(iii) the relationship between the person and the partner is, in the Secretary's opinion (formed as mentioned in subsections (3) and (3A)), a marriage-like relationship;
(iv) both the person and the partner are over the age of consent applicable in the State or Territory in which they live;
(v) the person and the partner are not within a prohibited relationship for the purposes of section 23B of the Marriage Act 1961.
It is not disputed that Mr Ferraro and Ms Kelly are not married, thus the relevant provision is section 4(2)(b). The Tribunal notes that the Applicants satisfy paragraphs 4(2)(b)(i), (ii), (iv) and (v) of the Act. In order to determine that the Applicants are members of a couple the Tribunal must be satisfied that all the conditions specified in section 4(2) are met. The condition which it remains for the Tribunal to consider is that under section 4(2)(b)(iii), that is, whether the Applicants are in a "marriage-like relationship". In forming an opinion as to whether the Applicants relationship is marriage-like the Tribunal must have regard to all the circumstances of the relationship. Section 4(3) provides an inclusive list of matters to which the Tribunal should have regard in forming an opinion:
"Member of a couple—criteria for forming opinion about relationship
4(3) In forming an opinion about the relationship between 2 people for the purposes of paragraph (2)(a) or subparagraph (2)(b)(iii), the Secretary is to have regard to all the circumstances of the relationship including, in particular, the following matters:
(a) the financial aspects of the relationship, including:
(i) any joint ownership of real estate or other major assets and any joint liabilities; and
(ii) any significant pooling of financial resources especially in relation to major financial commitments; and
(iii) any legal obligations owed by one person in respect of the other person; and
(iv) the basis of any sharing of day-to-day household expenses;
(b) the nature of the household, including:
(i) any joint responsibility for providing care or support of children; and
(ii) the living arrangements of the people; and
(iii) the basis on which responsibility for housework is distributed;
(c) the social aspects of the relationship, including:
(i) whether the people hold themselves out as married to each other; and
(ii) the assessment of friends and regular associates of the people about the nature of their relationship; and
(iii) the basis on which the people make plans for, or engage in, joint social activities;
(d) any sexual relationship between the people;
(e) the nature of the people's commitment to each other, including:
(i) the length of the relationship; and
(ii) the nature of any companionship and emotional support that the people provide to each other; and
(iii) whether the people consider that the relationship is likely to continue indefinitely; and
(iv) whether the people see their relationship as a marriage-like relationship.."
The Tribunal considered the circumstances of the relationship between Mr Ferraro and Ms Kelly with regard to each of these matters.
financial aspects of the relationship
The Applicants have indicated on numerous occasions that they have never had, and do not at present have, any joint financial commitments or responsibilities, whether that be in the form of joint ownership of assets and/or liabilities, or the pooling of financial resources.
In the first application for accommodation with the Department of Housing (T17, pp56-57) in March 1985, Mr Ferraro indicated that neither he nor Ms Kelly had any assets or liabilities at that time. In 1987 in the Centrelink field officer's report on the Applicants' living arrangements, it was indicated that the Applicants claimed they had no joint accounts or assets. In the Centrelink "Assessment of living arrangements" forms completed on 27 January 2000 by Mr Ferraro (T15) and 17 February 2000 by Ms Kelly (T16) they stated that they have not purchased any major items together and have no joint financial commitments. Further, Ms Kelly, in oral evidence, stated they have separate crockery, linen and furniture, although they both share a lounge owned by Mr Ferraro and share a table and chairs owned by Ms Kelly. Mr Ferraro repeated in oral evidence that neither he nor Ms Kelly have any assets.
The Tribunal notes, however, that the Applicants have, for many years been co-tenants and, in this way, have undertaken a significant and lasting joint financial obligation.
There was no evidence before the Tribunal to suggest that Mr Ferraro and Ms Kelly have, or have had in the past, any joint ownership of assets. The Tribunal notes that there is no evidence before it that the Applicants hold any assets or major financial commitments as individuals either. As such the Tribunal finds that Mr Ferraro and Ms Kelly, with the exception of their joint obligation as tenants, do not have any joint assets, liabilities or major financial commitments.
The Tribunal accepts that for the most part of their relationship, the Applicants have shared their household expenses and bills equally. Although in a statement dated February 1987 (T7) Ms Kelly stated that Mr Ferraro paid the majority of the household bills and that she paid $55 rent to Mr Broughton (her uncle) and Mr Ferraro paid $80, in more recent evidence both Applicants have asserted that they share household expenses equally. Of particular relevance is the Centrelink "Assessment of living arrangements" forms completed on 27 January 2000 by Mr Ferraro (T15) and 17 February 2000 by Ms Kelly (T16) and their oral evidence before the Tribunal, where they confirmed that they share the payment of bills, food and household items equally. In the absence of any evidence to the contrary before it, the Tribunal finds that the Applicants currently share their day-to-day household expenses evenly between them.
There is conflicting evidence before the Tribunal as to whether the Applicants are nominated beneficiaries under each other's wills. In the Centrelink "Assessment of living arrangements" forms completed on 27 January 2000 by Mr Ferraro (T15) and 17 February 2000 by Ms Kelly (T16) they stated that they have not nominated each other as beneficiaries under each other's wills. Further, in the original decision made by a Centrelink officer to regard the Applicants as living in a marriage-like relationship, with reference to the interview conducted with the Applicants on 26 April 2000, the officer stated that:
"He [Mr Ferraro] said that neither of them have each other as beneficiaries, but she said that she has him as her beneficiary. She thinks she is the beneficiary of his will…"
However, contrary to his previous evidence, in oral evidence to the Tribunal Mr Ferraro stated that Ms Kelly is currently a beneficiary in his will. The Tribunal therefore prefers Mr Ferraro's oral evidence in this application to his previous statements and finds that Ms Kelly is a beneficiary in his will. The Tribunal also finds that Mr Ferraro is a beneficiary under Ms Kelly's will, relying on her evidence at the interview of 26 April 2000.
nature of the household

Mr Ferraro and Ms Kelly have stated on numerous occasions, such as in their statements dated January 1987 (T4); their Centrelink "Assessment of living arrangements" forms completed in early 2000 (T15 and T16); and in oral evidence, that they have separate bedrooms, each with their own television, but share common living areas. The Tribunal accepts the evidence of the Applicants that they occupy separate bedrooms. Although the Tribunal accepts the separateness of their sleeping arrangements, this aspect of their relationship is not given substantial weight given the high level of commitment and cooperation which exists within their household, as discussed below.
The Centrelink field officer, reporting in 1987 on the Applicants' living arrangements (T4) stated that although they claimed household chores are shared, his opinion was that Ms Kelly did the majority of the housework as Mr Ferraro seemed limited in his capacity due to his medical condition. In a statement by Ms Kelly in February 1987, she said she assists with household chores more than Mr Ferraro because of his injury.
In oral evidence Mr Ferraro stated, in relation to how they currently share housework, that when he is able to he mows the lawn and keeps the house clean, but that Ms Kelly does most of the cooking, observing a diabetic diet, and sometimes does his washing as well as her own. He further stated that he and Ms Kelly sometimes eat meals together. Ms Kelly, on the other hand, stated that they do their own washing and cooking separately and that the only time she did any of his washing was when he was ill. In contradiction to Mr Ferraro's evidence, she stated that they seldom eat meals together, never cook for each other and that she does not now do anything for Mr Ferraro in the household.
The Tribunal finds that the inconsistencies in the Applicants' evidence indicate an attempt by Ms Kelly to minimise the appearance of cooperation between them in the household. The Tribunal prefers the evidence of Mr Ferraro, who, the Tribunal considers, was more candid. Relying on the oral evidence of Mr Ferraro and Ms Kelly's statement in 1987, the Tribunal concludes that Mr Ferraro and Ms Kelly have had in the past, and continue to have, a high level of cooperation in the household.
social aspects of the relationship
It was submitted by the Respondent that the Applicants have on several occasions presented themselves as married or living in a defacto relationship, in particular throughout their dealings with Centrelink and the Department of Housing. In the Centrelink "Assessment of Living Arrangements" forms completed 27 January 2000 by Mr Ferraro (T15) and on 17 February 2000 by Ms Kelly (T16) both stated that they have not claimed being married or defacto for any purpose. Despite these assertions, there is the evidence of the Centrelink file notes and the evidence of the Department of Housing applications, which indicate to the Tribunal that the Applicants have presented themselves as members of a couple on several occasions.
The Tribunal also notes that in T16 Ms Kelly answered "yes" to the question, "Have you ever been legally married to or lived as if married (de facto) with Mr Ferraro", without providing any further details .
In the Centrelink field officer's report dated January 1987 it was noted that Ferraro used the words "the wife" when referring to Ms Kelly. When his attention was drawn to this document in cross-examination, Mr Ferraro stated that "this must have been a mistake" without offering any further explanation. In cross examination Ms Kelly was referred to the interview conducted by the field officer from Centrelink in January 1987, and stated that she did not recall the interview.
In a file note dated 21 December 1999 (T11), a Centrelink officer noted that when inquiring about carer allowance for Ms Kelly in respect of care provided for him, Mr Ferrrao used the word "wife" to refer to Ms Kelly. In a further Centrelink file note dated January 2000 (T13) in relation to Mr Ferraro it was noted "client stated Yvonne Ferraro as his wife, that they are married!!".
When Mr Ferraro's attention was invited to the Centrelink file notes, in cross-examination, Mr Ferraro initially denied having used the word "wife" to refer to Ms Kelly, but later stated that this may have been "a slip of the tongue" on his part. When Ms Kelly was referred to the same file notes, she stated that Mr Ferraro had been quite ill and so at this point "he didn't know what he was saying".
The evidence clearly shows that the Applicants have endeavoured to present themselves as members of a couple throughout their dealings with the Department of Housing since 1985 and continue to do so, as currently the Department still considers them as members of a couple. Mr Ferraro has also presented himself and Ms Kelly as members of a couple to Centrelink, although not as consistently as he has to the Department of Housing. John Hunter Hospital had also recorded Ms Kelly as Mr Ferraro's next of kin.
The Tribunal notes that a Health Professional Assessment was completed by Dr Campbell-Smith on 7 January 2000 in respect of Mr Ferraro (T16 – N2001/76). He stated that Mr Ferraro sometimes shows signs of depression and withdrawal from social contact.
In T15, the "Assessment of Living Arrangements" forms completed by the Applicants, Mr Ferraro claimed they do not share social and leisure activities, however Ms Kelly indicated that they do share social and leisure activities.
In oral evidence before the Tribunal Mr Ferraro stated that since moving to Tamworth he has made a few friends but does not drive and only occasionally goes out to the local club. He also stated that he and Ms Kelly sometimes go out together. In contradiction to Mr Ferraro's evidence, Ms Kelly stated that she and Mr Ferraro never socialise together.
Given the inconsistent evidence provided by the Applicants in relation to their social activities and the evidence which illustrates the Applicants' holding themselves out as being married or in a defacto relationship by identifying each other as "wife" "defacto" or "spouse", the Tribunal is satisfied that the social aspects of their relationship indicate a marriage-like relationship. In the Tribunal's view, this contributes significantly to an opinion that the Applicants' relationship is marriage-like in nature.
any sexual relationship
The Applicants have consistently asserted in both oral and written evidence that they do not have a sexual relationship. The Tribunal, relying on the evidence of the Applicants, is satisfied that Mr Ferraro and Ms Kelly do not have a sexual relationship. The Tribunal accepts that this indicates an element of separateness in their relationship. However, the Tribunal agrees with the Respondent's submission that little weight should be given to this as the absence of a sexual relationship, while impossible to verify, does not of itself indicate that the relationship between the Applicants is not marriage-like in nature.
nature of commitment
In addressing this criteria the Tribunal notes its decision in Re Roberts and Secretary, Department of Social Security (1987) 12 ALD 725 , where it was stated (prior to the codification of the principles into the statutory criteria under s 4(3)):
"It [the Tribunal] must search for the essential characteristic of the marital relationship which is the commitment of the applicant… to a greater extent than, and in a matter qualitatively different from, the commitment of either to anyone else: Re Donald and Director-General of Social Security (1983) 5 ALN N185."
There is no evidence before the Tribunal that either Ms Kelly or Mr Ferraro have a commitment to anyone else besides each other. The following considerations confirm the Tribunal in this opinion.
Mr Ferraro stated in oral evidence that he met Ms Kelly approximately 13 years ago, began living with Ms Kelly about three years later, initially sharing accommodation with her uncle, and has lived with her ever since, in various accommodation. Ms Kelly on the other hand stated that they had met about 15 years ago and then began sharing accommodation a couple of years later in Ashfield, and separated once for a period of six months when she left Sydney and moved to Nelson Bay for 6 months.
Despite the oral evidence of the Applicants, the Tribunal finds that the Applicants have shared various accommodation for nearly 17 years. In making this finding, the Tribunal relies on the documentary evidence of the Applicants' Department of Housing application for accommodation, dated 29 March 1985 (T17, p57), which indicates that their relationship dates back at least to 1985. The Tribunal prefers this to the Applicants' rather vague oral evidence.
The Tribunal accepts that the Applicants initially shared a privately rented flat with Ms Kelly's uncle, Mr Broughton, in Ashfield. Since then Mr Ferraro and Ms Kelly have lived together in Drummoyne, Riverwood, Campsie and most recently in Tamworth, in Department of Housing accommodation.
The Tribunal accepts that there may have been a separation for six months, however given the length of time over which the Applicants have shared accommodation, for the most part they have lived together, demonstrating a high level of commitment to each other. This is particularly borne out by the Applicants' move, together, from Sydney to Tamworth.
Both Applicants stated in oral evidence that they would prefer their current living arrangements to remain as they are. Neither indicated any plans to live separately in the future, with Mr Ferarro stating that he would not want to break up his "friendship with Ms Kelly", and Ms Kelly stating that she is happy with her current living arrangements and would not want to have to look for other accommodation.
The Tribunal finds that, given their decision to move to a country town together, after having lived together in Sydney for at least 17 years, as well as their plans to remain living together, the Applicants have shown strong commitment to each other.
Statements made by Ms Kelly in relation to her claim for carer allowance in respect of Mr Ferraro and more recently, by Dr Campbell-Smith in the Health Professional Assessment completed on 7 January 2000 in respect of Mr Ferraro confirm that Ms Kelly provides Mr Ferraro with close personal care on a daily basis.
The Tribunal finds that, despite the Applicants' claims that they are not in a marriage-like relationship, the length of the Applicants' relationship and the nature of the companionship and emotional and practical support they have provided each other and continue to provide each other, demonstrates a high level of commitment between them. This conclusion is also supported by the Applicants having on various occasions identified themselves or been identified by others as each other's next of kin.
Although the Applicants assert that they merely share a friendship, the Tribunal does not give this much weight when considering the nature of their commitment to each other. Given the length of their relationship, their decision to move to Tamworth together, the great amount of emotional and practical support, care and companionship they have provided each other over the last 17 years, particularly Ms Kelly to Mr Ferraro since he suffered his stroke, and their desire to continue living together and maintain their relationship as it is, the Tribunal must find that this far outweighs any assertions made by the Applicants that they do not see their relationship as a marriage-like relationship. The Tribunal therefore finds that the Applicants have exhibited a high level of commitment to each other, since they began living together nearly 17 years ago, and continue to do so.
The Tribunal had regard to all the criteria under s 4(3), which indicated both the separateness of the Applicants' relationship as well as the marriage-like nature of their relationship. On balance, that evidence which indicates a marriage-like relationship outweighs the evidence which suggests separateness in their relationship.
The separate aspects of their relationship are evidenced by the absence of a sexual relationship, the absence of joint financial commitments to a large extent and the separate nature of their living arrangements to the extent that they have separate bedrooms. On the other hand, a marriage-like relationship is indicated by the level of cooperation between the Applicants in their household, the social aspects of their relationship such as the several occasions they have held themselves out as members of a couple (to the Department of Housing and Centrelink), and the strength of their commitment, which they have demonstrated for each other over the past 17 years - evidenced by the length of their relationship, the companionship, emotional and practical support and care they have provided each other, as well as their decision to move to Tamworth together and their intention to continue living together.
Conclusion
Having considered all the evidence before it and having regard to all the circumstances of the relationship between Mr Ferraro and Ms Kelly, pursuant to sections 4(2) and (3) of the Act, the Tribunal concludes that the relationship between Mr Ferraro and Ms Kelly is a marriage-like relationship. Mr Ferraro and Ms Kelly should therefore be treated as members of a couple, for the purpose of calculating their respective entitlements to disability support pensions under the Social Security Act 1991.
Determination
The Tribunal affirms the decision under review.
I certify that the 97 preceding paragraphs are a true copy of the reasons for the decision herein of Ms N Bell, Member
Signed: O. Caragianni           .....................................................................................
  Associate
Date of Hearing  7 February 2002
Date of Decision  24 April 2002
Representative for the Applicants Mr Ferraro
Advocate for the Respondent       Ms Schuster

[2002] AATA 285

24 April 2002

Key Legal Topics

Areas of Law

Social Security Law

Legal Concepts

Contract Formation

Breach of Contract

Unconscionable Conduct