LEANNE DURHAM and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

[2012] AATA 493

[2012] AATA 493  

Division	GENERAL ADMINISTRATIVE DIVISION
File Number	2012/1351
Re	LEANNE DURHAM
APPLICANT
And	SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
RESPONDENT

Decision

Tribunal	Senior Member Dr K S Levy RFD
Date of oral decision	12 July 2012
Date of written reasons	30 July 2012
Place	Brisbane

The Tribunal affirms the decision under review.

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Senior Member Dr K S Levy RFD

Catchwords

SOCIAL SECURITY – Pensions, benefits and allowances – Carer’s payment – Lump sum compensation payment – Preclusion period – No special circumstances – Decision under review affirmed.

Legislation

Social Security Act 1991 (Cth) ss 17, 1160, 1170, 1184K

Social Security Amendment Act 1988 (Cth)

Cases

Brodley and Secretary, Department of Social Security (1991) 63 SSR 878

Grima v Secretary Department of Social Security [1988] 16 ALD 311

Groth v Secretary Department of Social Security [1995] AATA 62

Hajar and Secretary, Department of Social Security (1988) 16 ALD 716; 47 SSR 614

Secretary Department of Employment and Workplace Relations v Homewood (2006) FCA 779

Krzywak v Secretary, Department of Social Security (1998) 15 ALD 690

Kirkbright v Secretary, Department of Families and Community Services (2000) 106 FCR 281; 65 ALD 211; 32 AAR 120

Shi v Migration Agents Registration Authority (2008) 235 CLR 286; HCA 31

REASONS FOR DECISION

Senior Member Dr K S Levy RFD

30 July 2012

INTRODUCTIOn

1. The applicant, Leanne Durham, suffered an injury in the workplace to her shoulder on 13 March 2009 which required a period of leave from work. During that period of leave, and subsequently, she was a carer for her mother and step-father. Her mother died some months later. She has continued to care for her step-father since that time on a full-time or part-time basis.

2. Ms Durham was granted a carer payment of $6,435.57 for the period 29 June 2009 to 30 November 2009. She ultimately received a lump sum compensation settlement amount of $80,000 on 31 August 2011, which related to the shoulder injury that she received in the workplace on 13 March 2009. The amount of $80,000, received as lump sum compensation, resulted in a preclusion period from 13 March 2009 (the date of injury) to 18 February 2010. As part of that settlement she was also obliged to repay the amount of $6,435.57 in respect of carer payments made and which coincided with part of the preclusion period.

3. Ms Durham applied for return of the amount of $6,435.57 as she said it was “unfair”, owing to the fact that she also had to look after her parents during that period and that she was not compensated by Centrelink for her shoulder injury or for caring for her parents. That application was rejected by Centrelink. She then appealed to the Social Security Appeals Tribunal. That Tribunal affirmed Centrelink’s decision on 8 March 2012. She now seeks further review by this Tribunal.

   ISSUE

4. Are there any special circumstances in terms of s 1184K of the Social Security Act 1991 (Cth) (“the Act”) which would justify the treatment of part of the lump sum compensation amount as not having been made and which would result in a refund of an amount equivalent to the carer payment of $6,435.57?

   EVIDENCE

5. Of relevance to this application is the fact that the lump sum compensation amount of $80,000 resulted in the calculation of a lump sum preclusion period commencing on 13 March 2009 and concluding on 18 February 2010 (a period of 49 weeks). This is provided for by s 1170 of the Act. The applicant does not take issue with that calculation.

6. The Secretary submitted that the claim by the applicant would not meet the definition of “special circumstances”. During the hearing, the applicant was referred to a number of documents including her application for carer payment and the advice and correspondence leading up to the settlement of the lump sum compensation, in particular, correspondence between Centrelink and the applicant’s lawyers. Prior to settlement, the applicant received a form which she completed and formally lodged with Centrelink on 27 May 2009. That proforma highlighted the possible consequences of having a preclusion period and having to re-pay certain amounts, if she received lump sum compensation for her injury. Ms Durham acknowledged signing the form although she could not recall whether she read it at the time as not only was she dealing with stress from the workplace but she was also trying to cope with her mother’s illness and being a full-time carer. She told the Tribunal that she was a full-time carer for her step-father who previously was cared for by her mother. Her mother died some months later but she continued to care for her step-father.

7. After her mother’s death, the applicant continued to live with her step-father, but he ultimately decided to sell the family home. Ms Durham then relocated and had to buy some new furniture and white goods for her to have separate accommodation.

8. Following the lump sum settlement, Ms Durham had to repay amounts to government agencies which represented the periodic payments of workers’ compensation and the carer payment which she had received while she was looking after her parents. This was because she had then received lump sum compensation with respect to a period which overlapped with periodic payments. These amounts were deducted at the time of settlement of the lump sum compensation.

9. Ms Durham left her former employment and ultimately obtained a new position as a carer in a nursing home. However she only was able to obtain 52 hours work per fortnight on a permanent part-time basis, compared with the 76 working hours she previously had as a security officer.

10. Ms Durham now earns $1,200 per fortnight. She has recently acquired a back injury at work although she continues to work on light duties. Her income remains at $1,200 per fortnight although part of this is paid by workers compensation while she has a back injury.

11. The applicant described her financial circumstances. She has no other income other than her part-time work. She pays rent and ordinary expenses including groceries, mobile phone, the usual costs of running a car, going to work etc. Her only debt is $26,000 for a new car which she recently purchased.

12. She now has resumed living with her step-father. Presently, she has some additional costs of medication as she has been diagnosed with diabetes and blood pressure. She told the Tribunal that she looks after her step-father who is now aged 85 years and is “very frail”. The applicant herself, who is 54 years old, has a relatively small amount in superannuation and has a modicum of personal assets including her car and furniture.

13. Under cross examination, she detailed her current costs from her income of $1,200 per fortnight. Of that, approximately $400 per fortnight is spent on groceries and other living expenses; $500 per fortnight on rent; medication of $70 per fortnight; a phone bill of $100 per fortnight and repayment on the loan for her car of $300 per fortnight. These estimates come to more than her $1,200 fortnightly income, however, the applicant said that sometimes her living expenses have to be reduced to make ends meet.

14. Mr McQuinlan submitted the applicant’s circumstances did not amount to financial hardship. In particular, he submitted that the usual benchmark is based on someone compared with the position of a pensioner. He submitted that Ms Durham is somewhat better off than a pensioner and therefore is not suffering “financial hardship” under s 1184K.

    CONSIDERATION

15. I provided an oral decision at the end of the hearing but undertook to provide more detailed reasons to the applicant. I have examined the relevant definition of “compensation affected payments” in s 17(1) for which the applicant received a carer payment. I have also looked at the definition of “compensation” as provided for in s 17(2) of the Act. Ms Durham has received amounts which satisfy both of those definitions. The “lump sum compensation payment” is provided for in s 1170 of the Act and I have examined as far as possible from the information provided, the accuracy of the calculations concerned. I find no error in those calculations. I note the applicant has not taken issue with the accuracy of the calculations or the lump sum period. I make a finding of fact that those calculations are correct. The applicant has not challenged those calculations.

16. Ms Durham received a lump sum payment of $80,000 on 31 August 2011, from which various costs and recovery of statutory amounts were deducted. Ms Durham told the Tribunal that after those cost recoveries and paying her legal costs, she received a lump sum of $26,000 (net) after settlement.

17. This claim overlaps with a claim for carer payment relevant to the period 29 June 2009 to 30 November 2009 when, concurrently over that period, the applicant also was suffering from a shoulder injury received at work some three months earlier on 13 March 2009. She cared for her parents over a significant part of this period until her mother passed away in August 2009 and then cared for her step-father. She has since obtained a position as a part-time carer and now earns less than she previously did.

18. I also make findings of fact that there was a compensation affected payment (a carer payment); and a lump sum compensation amount as prescribed by the Act; that a lump sum preclusion period has been correctly assessed; and that the applicant had difficult circumstances in 2009 not only from her work situation but also the emotional distress of looking after her infirmed parents. I also find that the applicant’s own health has deteriorated in recent times and that she now has increased costs for her own health than what she would have had three years ago when caring for her parents.

19. The relevant statutory provisions here are contained in Part 3.14 of the Act – “Compensation Recovery”. It is apparent that since the Social Security Amendment Act 1988 (Cth), the lump sum preclusion period which prevents a recipient of a lump sum compensation from receiving any social security benefits for a calculable period, holds true whether or not there is any nexus between the receipt of the compensation amount and the compensation affected payment (see s 1160(2) of the Act; and also Grima v Secretary Department of Social Security [1988] 16 ALD 311).

20. While I accept the applicant was undoubtedly highly anxious while she was caring for her parents, she nevertheless had been informed of the potential requirement for repayment of amounts of periodic payments if she accepted a lump sum compensation amount. The applicant conceded that she had been advised of this not only on the forms that she completed for Centrelink but that she also had received advice and correspondence from her solicitors to that effect.

21. The central question is whether the applicant satisfies the definition of “special circumstances” in s 1184K of the Act. In considering whether any discretion should be exercised in the applicant’s favour, I note the objective of the legislation is the foundation for the Tribunal’s consideration. In other words, the purpose of the legislation is that there should be no “double dipping” or overlapping payments between various forms of compensation legislation and including the social security legislation (see Groth v Secretary Department of Social Security [1995] AATA 62).

22. “Special” circumstances are those which are out of the ordinary (Groth). That is, such circumstances would be “exceptional in amount, degree, intensity etc” (see Concise Oxford Dictionary definition). The degree or intensity indicates the impact or effect on a person, which must not only be difficult, but must be exceptionally so. The hardship must be more than most people would experience.

23. The applicant submitted that the special circumstances here and the requirement to repay $6435.57 was “unfair”, and as a result, she has experienced a degree of financial hardship. The Secretary says the hardship the applicant experienced does not satisfy the term “financial hardship” as contemplated by the law. In this case, there is hardship from two sources – (1) the shoulder injury; and (2) dealing with the emotional and psychological effect on her of the applicant’s dying mother and her step-father’s serious and long term ill health. Those would have had cumulative and deleterious effects on the applicant and the Tribunal is not prevented from taking those circumstances into account (Kirkbright v Secretary, Department of Families and Community Services (2000) 106 FCR 281; 65 ALD 211; 32 AAR 120; and Shi v Migration Agents Registration Authority (2008) 235 CLR 286; HCA 31).

24. The fact that the original lump sum payment is a workplace injury and therefore unrelated directly to the carer payment, does not affect the application of the provisions of Part 3.14 of the Act (see s 1160(2) of the Act). In addition, the Secretary has submitted that the applicant’s circumstances must be more than straitened – they must be exceptional (Krzywak v Secretary, Department of Social Security (1998) 15 ALD 690). The Secretary also submits that financial hardship alone would not be regarded as “special circumstances” (Hajar and Secretary, Department of Social Security (1988) 16 ALD 716; 47 SSR 614; Brodley and Secretary, Department of Social Security (1991) 63 SSR 878).

25. The applicant submitted her claim (that it is unfair for her not to be able to retain the amount of carer payment) is based on the fact that she looked after both of her parents over all or part of the period for which she originally received carer payment and also, it is apparent that the government would otherwise have had to bear the cost of having her mother hospitalised. There was no evidence by either party that would enable an evaluation of whether, in fact, medical authorities would have admitted her to hospital for the part or whole of the period concerned. Therefore, that argument is not sustainable.

26. The applicant also argues that Centrelink did not pay her for her shoulder injury but if it had, then she would not object to not getting a carer payment. The difficulty with that argument is that this legislation is designed with a purpose of preventing “double dipping”, where payment of government revenue is involved. It is also relevant that compensation for workplace injuries is the responsibility of WorkCover in Queensland or, in other words, it is a state government responsibility. The “carer payment” is one which is the responsibility of the Commonwealth. The two are not related, except that s 1160(2) makes it clear that payment of Commonwealth compensation is not permitted for a period for which a lump sum settlement is paid in respect of compensation.

27. The lump sum amount for which the applicant was ultimately compensated is effectively backdated to the period commencing 13 March 2009 and this period overlaps with the period she concurrently cared for her mother and step-father. It is not possible to measure how much care should be provided by a loved one as opposed to how much the government can provide in caring for people’s loved ones. The statutory law however is specific and measurable.

28. In considering whether there are “special circumstances”, that is, whether her circumstances are extraordinary, I assess the applicant’s claim by taking into account  relevant factors as follows:

    (a)The health of the applicant;

    (b)Her capacity for work;

    (c)Her income (if any);

    (d)Any assets held (including any assets necessarily disposed of); and

    (e)Financial obligations or expenses borne which are relevant to the compensation affected payment.

29. I understand that the applicant has borne pain and inconvenience in caring for her parents and that, undoubtedly, some financial costs also accrue. It may be that in some circumstances, the consequential effects of financial hardship can result in a very high level of stress or an inability of a person to have the basic or frugal needs for living without some indignity (see Secretary Department of Employment and Workplace Relations v Homewood (2006) FCA 779 at [44]). While this principle was obiter dictum in that case, it is relevant to the present case and I take it into account.

30. In assessing the net effect of the above factors, the applicant’s health, apart from a shoulder injury and emotional distress in the relevant period in 2009, was better than what it is presently. The applicant now needs medication to control blood pressure, diabetes and pain in her shoulder and back, which are workplace injuries. However, she does not have an incapacity for work and she has an income that essentially covers her outgoings. When she pays the debt off her car, that position will be considerably better.

31. She has few other assets other than a small amount in superannuation which undoubtedly would not be sufficient for her in retirement and she will probably require future social security payments to support her. Nevertheless, her income, debts, financial obligations and living standards are not such that they are indicative of financial hardship comparable with most others in society. Considering the purpose of the legislation, the applicant’s position is not consistent with a person in “special circumstances”. I find therefore, that the applicant cannot succeed in this application.

    Decision

32. The decision under review is therefore affirmed.

I certify that the preceding 32 (thirty-two) paragraphs are a true copy of the reasons for the decision herein of Senior Member Dr K S Levy RFD.

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Associate

Dated 30 July 2012

Date of hearing	12 July 2012
Applicant	In person
Advocate for the Respondent	Rick McQuinlan