Krizsanovski and Department of Family and Community Services - [2001] AATA 830

DECISION AND REASONS FOR DECISION [2001] AATA 830

ADMINISTRATIVE APPEALS TRIBUNAL Nº V2000/1031

GENERAL ADMINISTRATIVE DIVISION

Re: IOAN KRIZSANOVSKI
Applicant

And:SECRETARY TO THE
DEPARTMENT OF FAMILY AND
COMMUNITY SERVICES
Respondent

DECISION

Tribunal: G.D. Friedman, Member

Date:3 October 2001
Place:Melbourne
Decision:The Tribunal sets aside the decision of the Social Security Appeals Tribunal dated 31 July 2000 and substitutes the following decision: In accordance with s1237AAD of the Social Security Act 1991 the right to recover all the debt owed to the Commonwealth by the applicant for the period 21 January 1998 to 16 December 1999 in the amount of $16,690.60 is waived with effect from 24 December 1999.

(sgd) Graham Friedman
Member
SOCIAL SECURITY - assurance of support - application for special benefit - incorrect answer to question in application form - debt to Commonwealth - errors by Centrelink - special circumstances - waiver of debt
Social Security Act 1991 s1237AAD
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Brittain and Secretary, Department of Family and Community Services [2000] AATA 161
Re Ebrahimi and Secretary, Department of Social Security [1998] AATA 324
Re Nehma and Secretary, Department of Family and Community Services [1999] AATA 219

REASONS FOR DECISION

3 October 2001 G.D. Friedman, Member

This is an application by Ioan Krizsanovski (the applicant) for review of a decision of the Social Security Appeals Tribunal (SSAT) made on 31 July 2000 which affirmed a decision of a Centrelink delegate of the Secretary to the Department of Family and Community Services (the respondent) dated 5 June 2000. The original decision by Centrelink was that the applicant was liable for a debt of $16,690.60, being the amount received by the applicant's mother as Special Benefit (special benefit) while an Assurance of Support was in effect.
At the hearing of this matter on 24 September 2001 the applicant was represented by Dr I. Freckleton of Counsel. The respondent was represented by Ms P. D'Cunha of the Administrative Law Team, Centrelink. The evidence before the Tribunal comprised oral evidence and the documents lodged under s37 of the Administrative Appeals Tribunal Act1975 together with two exhibits (Exhibits A1 and A2) tendered by the applicant and one exhibit (Exhibit R1) tendered by the respondent.
BACKGROUND
The applicant was born on 26 March 1955. On 1 May 1995 his mother Elisabeta Krizsanovski arrived in Australia on a visitor visa to assist the applicant with the care of his disabled son John Krizsanovski, born on 20 November 1994. On 11 March 1997 the applicant signed an Assurance of Support under the Migration Regulations 1994 in which he undertook to repay to the Commonwealth any funds paid to his mother under social security legislation.
On 17 December 1997 the applicant's mother was granted a subclass 806 visa giving her permanent residency in Australia. On 21 January 1998 she applied to Centrelink for special benefit on the grounds that she had no means of support because the applicant was no longer able to assist her financially. On her application form she incorrectly answered no to the question: Has an assurance of support been signed for you since you arrived in Australia? Centrelink granted the application and special benefit was paid to her from 21 January 1998 until 16 December 1999 at the maximum rate. The total amount paid was $16,690.60 (the debt).
On 24 December 1999 a delegate of Centrelink informed the applicant that as his mother received special benefit while the Assurance of Support was in effect, the debt was recoverable. On 5 June 2000 an authorised review officer affirmed the decision, and on 6 July 2000 the applicant applied to the SSAT for review. Following the decision of the SSAT the applicant lodged an application with the Tribunal on 25 August 2000.
EVIDENCE
The applicant, through a Hungarian interpreter, told the Tribunal that he came to Australia in 1987 and since then has been employed by the Ford Motor Corporation. He said that in 1995 he asked his mother to assist him with the care of his child because he was unable to manage on his own. He told the Tribunal that his former wife, whom he divorced in April 2001 but who lives in the family home, has played no role in parenting the child. The applicant stated that he has suffered several injuries at work and is taking medication for back pain. He said that he works night shift as a cleaner and is only able to work four nights each week because of his medical condition.
The applicant said that as the child suffers from global developmental delay he requires significant care and supervision, and the applicant's mother has been instrumental in caring for the child. Reports from doctors and other professionals at the Yooralla Society of Victoria provided to the Tribunal conclude that without the care by the applicant's mother the child would have been placed in an institution. The applicant said that for this reason he persuaded his mother to apply for permanent residence in Australia.
In relation to the Assurance of Support, the applicant stated that the form was completed by Alexander Koltay, a solicitor who spoke Hungarian and who assisted the applicant and his mother with migration and social security matters. The applicant stated that he was aware that he was required to guarantee to support his mother for a period of two years, and he signed the form even though Mr Koltay did not translate the document for him.
The applicant stated that after his mother was granted a permanent resident visa on 17 December 1997 Mr Koltay advised him to attend Centrelink to inquire about social security entitlements for her. The applicant obtained an application for special benefit and said that Mr Koltay completed the form, which the applicant and his mother then took to Centrelink on 22 January 1998, where the remaining details were completed by a Centrelink officer. The applicant stated that he believed that the two-year Assurance of Support period had expired. He said that no interpreter was provided at the Centrelink office and that both he and his mother did not understand the details of the application.
The applicant told the Tribunal that his mother received a letter dated 17 February 1999 advising her that special benefit would be paid, but no contact was made by Centrelink between this date and early 2000, when a letter dated 16 December 1999 advised him of the debt. He said that at no time did he mislead Centrelink or act dishonestly, and that if he had been made aware that he was liable to repay the amount of special benefit received by his mother he would have told Centrelink that he was in a position to provide some financial support to her. His mother receives $685 each fortnight, comprising carer payment of $407, family allowance of $196 and payment for the child of $82. He stated that special costs for the care of the child, in addition to normal household expenses, are $120 each fortnight, and other household expenses, including mortgage repayments, amount to $680 each fortnight. The applicant's employment records show that he has worked less than 40 hours each week since May 2001. His net income is approximately $1200 each fortnight, including a 30% loading for working at night.
Elisabeta Krizsanovski, through a Hungarian interpreter, told the Tribunal that she was born on 4 April 1927 and before coming to Australia she lived in Transylvania (now Romania). She said that she cannot read or write English and she left school without completing primary level. She said that she has been the principal carer for the child since her arrival in Australia and that he requires constant attention. She stated that she and the applicant approached Mr Koltay for assistance because he could speak Hungarian. She said that she knew that the applicant was required to give a guarantee that he would support her financially, but she had no knowledge of the meaning of Assurance of Support or other legal terms.
The applicant's mother confirmed that the application form for special benefit was prepared by Mr Koltay for her signature but he did not explain or translate all the questions contained in the form, including the question concerning the Assurance of Support. She said that the applicant accompanied her to the Centrelink office where the form was completed by a Centrelink officer. No interpreter was present and she stated that she had no understanding of the application process or whether any questions were asked of her. She said that at no time did she seek to mislead Centrelink and that she attempted to co-operate to the best of her ability, although she had little recollection of events at the Centrelink office.
Alexander Charles Koltay told the Tribunal that he is a solicitor and has been in general practice for many years. He stated that the applicant was his client and in 1997 he agreed to assist the applicant's mother with her migration application and contacted Centrelink on her behalf, although she was not a client. Mr Koltay agreed that he prepared the Assurance of Support for the applicant and the application for special benefit for the applicant's mother and that he did not recall translating all the contents of each document. In relation to the incorrect answer to the question concerning the Assurance of Support on the special benefit application form, Mr Koltay admitted that he was aware that the answer should have been yes but that he believed the assistance for which the applicant's mother was applying was a temporary measure that would not have to be repaid.
Deborah Janette Gnaden, Customer Service Officer with Centrelink in Cranbourne, told the Tribunal by telephone that Centrelink records show that she was the officer who interviewed the applicant's mother in relation to the application for special benefit. She stated that she had no recollection of the interview, but Centrelink practice was that if a claimant did not understand English a further interview would be scheduled and an interpreter arranged. If the claimant was accompanied by a person who understood English the interview would proceed if the officer was satisfied that this person understood and could interpret accurately.
Ms Gnaden said that if Centrelink records indicated that an Assurance of Support had been given, she would request clarification from the Assurance of Support Section of Centrelink and then discuss repayment obligations with relevant parties including the claimant and the assurer. She agreed that Centrelink records show that on 18 February 1998 she received advice from the Assurance of Support Section that: Mrs Krizsanovski was granted residence on 17.12.95, so the AOS has ended and that this information was incorrect because permanent residence was granted on 17 December 1997, so the Assurance of Support had not expired at that time. She also agreed that under the Guide to the Social Security Act used by Centrelink officers at the time a three-monthly review of each Assurance of Support should be conducted and in every case the assurer should be notified of the outstanding debt.
CONSIDERATION OF THE ISSUES
The Social Security 1991 (the Act) provides in relation to the waiver of a debt:
1237AAD. The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i)making a false statement or false representation; or
(ii)failing or omitting to comply with a provision of this Act or the 1947 Act; and
(b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c)it is more appropriate to waive than to write off the debt or part of the debt.
Note: Section 1236 allows the Secretary to write of a debt on behalf of the Commonwealth.

Dr Freckleton, on behalf of the applicant, said that there was no dispute that a debt to the Commonwealth has arisen but submitted that the Tribunal should exercise its discretion under s1237AAD to waive the debt. He said that there was no doubt that errors had been made by Centrelink and that the degree of responsibility by the applicant and his mother was negligible. He described the applicant and his mother as simple people from rural Transylvania who did not speak English and who relied on Mr Koltay, as a legal practitioner, to provide sound advice.

Dr Freckleton told the Tribunal that Mr Koltay, who admitted in evidence that he did not have expertise in social security or migration matters, failed to translate all the relevant documents or ensure that the applicant and his mother understood the issues and their obligations under an Assurance of Support. Dr Freckleton submitted further that Centrelink had failed to provide an interpreter at the interview for special benefit and had failed to follow its own guidelines about notifying the assurer of a growing debt, although Centrelink knew about the Assurance of Support signed by the applicant.
Dr Freckleton submitted that, for these reasons, the debt did not result from the applicant or his mother knowingly making a false statement or representation or knowingly failing or omitting to comply with a provision of social security legislation.
In relation to special circumstances, Dr Freckleton said that the applicant's mother came to Australia specifically to care for the special-needs child and that the child's welfare and ability to remain living in the family environment have depended on her willingness to remain in Australia. Dr Freckleton also referred to the manner in which the debt arose, the lack of consultation with the applicant, and the financial circumstances of the applicant. In particular he submitted that the applicant's income and earning capacity have declined because of ongoing back injury, and his position will be worsened when proposed family law proceedings concerning the division of assets with his wife are finalised. He referred to the decision of ReEbrahimi and Secretary, Department of Social Security [1998] AATA 324 in which the Tribunal noted the failure of the Department of Social Security to follow its own procedures which then significantly disadvantaged the applicant by preventing him from taking action to stop a debt continuing to accrue. He also referred to Re Nehma and Secretary, Department of Family and Community Services [1999] AATA 219 and Re Brittain and Secretary, Department of Family and community Services [2000] AATA 161.
Ms D'Cunha, on behalf of the respondent, submitted that in signing the Assurance of Support the applicant entered into a legally binding agreement with the Commonwealth that any social security payments to the applicant's mother during the relevant period would be repaid by the applicant. Ms D'Cunha stated that the applicant and his mother had the assistance of a legal practitioner in completing the Assurance of Support and the application for special benefit, so the applicant understood the consequences and obligations arising from his actions and those of the mother. Ms D'Cunha submitted further that the question on the application for special benefit concerning the Assurance of Support required a simple yes or no answer and that the applicant's mother knew or ought to have known that her answer was incorrect. Therefore the applicant knowingly made a false statement and failed to comply with social security legislation.
With regard to whether special circumstances exist, Ms D'Cunha stated that the applicant and his mother attended the interview together and that the applicant supported the matters put to Centrelink by his mother. Consequently there was no need for a further interview. Ms D'Cunha said that any error by Centrelink did not warrant the waiver of the entire debt. She submitted that the respondent is not suffering financial hardship as he is employed and his mother is receiving a carer payment and other benefits for providing care for the child.
In reaching its decision the Tribunal takes into account the written material, oral evidence and the submissions made at the hearing. After hearing oral evidence from the applicant and his mother and observing them in the witness box, the Tribunal finds that each displayed an extremely limited understanding of the proceedings or of the issues involved. The applicant's mother, in particular, even with the assistance of an interpreter at the hearing, could not comprehend concepts such as Assurance of Support or the requirements of social security legislation. The Tribunal finds that the applicant's mother relied on the applicant at all times and that the applicant followed the recommendations of Mr Koltay, a qualified legal practitioner of many years' standing. Mr Koltay failed to give proper advice or act in the best interests of both the applicant and his mother, even though he knew that their level of understanding was poor. For these reasons the Tribunal finds that the applicant and his mother acted in good faith to the best of their ability, and that neither knowingly misled or made false statements to Centrelink or failed or omitted to comply with the Act (s1237AAD(a)).
In relation to whether special circumstances exist, the Tribunal notes the decision of Re Beadle and Director-General of Social Security (1984) 6 ALD 1 in which the Tribunal stated at par 21:
But it is not helpful to focus too closely on each particular circumstance of the applicant and ask whether it is special. Of itself it is unlikely to be special for there would be many in a similar situation. The question is whether, when the relevant circumstances of the applicant are looked at in their entirety, they may fairly be described as unusual, uncommon or exceptional so as to warrant payment of the allowance earlier than the date from which it would ordinarily be paid.
The Tribunal accepts the submission by Dr Freckleton that the applicant's mother came to Australia for the sole purpose of assisting the applicant with the care of the child, and that without her support the child would almost certainly have been placed in an institution, at significant cost to the Australian community. The Tribunal also finds that Centrelink made errors in that it did not follow its own guidelines by failing to consult the applicant about his ability to support his mother, or to inform the applicant about the growing debt even though it was aware of the Assurance of Support. Centrelink also failed to provide an interpreter for the applicant's mother at the interview. The Tribunal views these errors as serious because significant consequences for the applicant and his mother flowed from them.
As far as financial circumstances are concerned, the Tribunal notes that the applicant is employed four days each week and that his mother receives a carer payment and other benefits. However the Tribunal accepts the submission that the applicant's ability to work full-time is limited by his ongoing back pain, his financial situation is likely to be affected adversely by any property settlement that may force the sale of the family home and the division of assets, and the child has special needs.
For the above reasons the Tribunal finds that when the circumstances are viewed in their entirety they are unusual, uncommon or exceptional and constitute special circumstances that make it desirable to waive the debt (s12377AAD(b)). Therefore the Tribunal finds that it is more appropriate to waive than to write off the debt or part of the debt (s1237AAD(c)).
For these reasons the Tribunal is satisfied that the provisions of s1237AAD of the Act are made out and that the right to recover all of the debt should be waived.
DECISION
The Tribunal sets aside the decision of the Social Security Appeals Tribunal dated 31 July 2000 and substitutes the following decision: In accordance with s1237AAD of the Social Security Act 1991 the right to recover all the debt owed to the Commonwealth by the applicant for the period 21 January 1998 to 16 December 1999 in the amount of $16,690.60 is waived with effect from 24 December 1999.
I certify that the twenty-eight [28] preceding paragraphs are a true copy of the reasons for the decision of
G.D.Friedman, Member
(sgd)       Catherine Thomas
              Clerk
Date of hearing:  24 September 2001
Date of decision:  3 October 2001
Counsel for applicant::                Dr I. Freckleton
Solicitor for applicant:                  Victoria Legal Aid
Solicitor for respondent:              Nil - Ms P. D'Cunha, Advocate with Centrelink