Lee and Secretary, Department of Employment and Workplace Relations

[2005] AATA 1163

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 1163

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2005/248

GENERAL ADMINISTRATIVE DIVISION		)
Re		WAYNE LEE

Applicant

And SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Senior Member Robin Hunt

Date24 November 2005

PlaceSydney

Decision The decision under review is affirmed.

..............................................

Ms R Hunt
  Senior Member

CATCHWORDS

SOCIAL SECURITY – Preclusion period imposed – Discretion to modify where special circumstances – No exercise of discretion – Decision under review affirmed.

LEGISLATION

Social Security Act 1991

CASES

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

Re Evagrew and Director-General of Social Secretary (1983) 16 SSR 161

REASONS FOR DECISION

24 November 2005 Ms R Hunt, Senior Member          

introduction

1.      Mr Lee, the applicant, was born in 1959 and is approximately 46 years of age. He was granted a disability support pension (DSP) in 1998. Mr Lee claimed compensation after a fall and his claim was settled on 5 May 2004 by payment to him of $75,000, inclusive of costs. Mr Lee’s solicitors informed Centrelink and requested details of any compensation charge. An amount was advised and recovered by Centrelink. Centrelink later returned some of the recovered amount to Mr Lee. Centrelink twice reduced Mr Lee’s debt in respect of the charge, firstly, because of the amount of solicitor’s costs and, later, because of a payment to the Health Insurance Commission. After reimbursement of various amounts paid on his behalf and refunds from Centrelink, Mr Lee received somewhat more than $23,000. Mr Lee was still dissatisfied with the Centrelink reconsideration and applied for review by the Social Security Appeals Tribunal (the SSAT). The SSAT on 4 February 2005 affirmed the decision of Centrelink that a shortened preclusion period be imposed from 1 September 2000 to 10 May 2001 and that the charge be reduced from $11943.34 to $6726.62. Mr Lee seeks a further reduction before this tribunal.

consideration and findings

2.      Mr Lee was self represented. He told the tribunal he had suffered a series of misfortunes. He needed the DSP in 1998 after being assaulted and having a shoulder reconstruction. Then, in 2000, he had started working for his children who had opened a restaurant. He went home on 10 November 2000 to discover his “grandfather” had slipped in the bath and drowned. He did not like staying at home after that and went and stayed in a hotel. He had an accident at the hotel when he went for a swim on 11 December 2000. He slipped down some swimming pool stairs, injuring his elbow, and has been attending a pain clinic ever since. He received compensation after some negotiations and arbitration and after learning that he had a brain tumour. He had originally claimed $800,000 but was advised to accept an offer of $75,000. He said his solicitor had agreed to give him $25,000 out of the settlement monies. Mr Lee complained that Centrelink had made miscalculations but he accepted the figures set out in the SSAT decision. The SSAT found that he received the net amount of $23,767.75.

3.      Mr Lee believes that he still should receive a further reduction of the repayment to Centrelink. Mr Lee claimed that he had used his settlement monies to repay loans from family members. He is aware that the decision maker has discretion to reduce his debt to Centrelink where there are special circumstances.

4.      Mr Lee told the tribunal that he has two young children aged 7 and 2 and that he has to pay maintenance for their upkeep. He further submitted that he could not think of any more special circumstance than having a brain tumour. Mr Lee was unable to give further oral evidence at a hearing, which he attended briefly on 5 August 2005, as he had a doctor’s appointment. On the next hearing day arranged by the tribunal, 16 November 2005, Mr Lee was unwell. Mr Lee furnished a medical certificate certifying that he was suffering persistent shoulder pain from the shoulder reconstruction and had other medical problems making him “unfit for court” from 15 November to 22 November 2005 inclusive. He wrote to the tribunal on 15 November 2005 asking it to make a decision on the material before it. He furnished medical reports and financial records to assist the tribunal’s decision.

5.      The documents furnished by Mr Lee show he has many medical problems, including asthma and pain in various parts of the body after his tumour removal surgery, his fall down the stairs and the assault. A letter from Dr G Berdoukas, the operating surgeon, addressed to Mr Lee’s referring doctor and dated 3 February 2003, explains the surgery and outcome. This letter sets out the approach Dr Berdoukas and a colleague followed in operating on Mr Lee’s “right sided acoustic tumour”. Dr Berdoukas reported “good access” and, although there was a “tiny flat scrap of tumour” remaining, was “confident that nothing further will ever need to be done in this regard”. He wrote that time would tell about whether Mr Lee would suffer hearing loss.

6.      Mr Lee also furnished a letter, dated 22 August 2003, about his attendance at a Prince of Wales pain clinic in 2003 after the surgery. A staff specialist noted various conditions of which Mr Lee complained but felt that he had improved at least in some respects and recommended hydrotherapy, medication and continuing treatments. A Prince of Wales Hospital booking for an MRI scan at 9:00am on 2 September 2005 is confirmed and signed by Mr Lee on 20 October 2005. Mr Lee has not explained the discrepancy in these dates. Another letter to Dr Berdoukas from the Prince Henry and Prince of Wales pain management clinic, dated 27 April 2005, deals with various health, pain and medication issues considered and recommendations made.  

7.      Mr Lee’s 2005 bank statements produced show a fluctuating balance varying from $500 credit to nil or minus amounts. A Centrelink income statement, dated 8 August 2005, shows he is receiving the DSP of $459.00 per fortnight, together with a pharmaceutical allowance of $5.80 and supplement of $17.30. Deductions include child support of $10, Centrepay deduction of $60, lump sum advance repayment of $38.50 and rent deduction scheme deduction of $198.80. Centrelink advised the tribunal on 15 November 2005 that Mr Lee receives gross pension of $494.70 per fortnight. Mr Lee also supplied his electricity and gas accounts, which indicated arrears. There is nothing before me that indicates Mr Lee has any substantial asset. I also note that Mr Lee has not produced evidence of any outstanding medical bills and has not claimed he is disadvantaged by not being able to pay for his many medical treatments. Mr Lee’s tumour operation has been successful according to the surgeon, although he has some residual discomfort.

8.      While it is obvious that Mr Lee has health problems, this is the reason he is receiving DSP. The medical reports furnished confirm that Mr Lee is deserving of this support. There are, however, inconsistencies in the material before the tribunal. Part of his claim for compensation filed in the District Court of NSW concerns a restaurant business he there claims he commenced on 18 September 2000 (T13). In that action he claimed economic loss for expected earnings as a chef. Before the tribunal, Mr Lee described the restaurant as a business commenced by his children.

9.      As to his overdue electricity and gas accounts, Centrelink has informed the tribunal that Mr Lee is currently using the Centrepay facility to ensure that regular fortnightly payments are made directly from his pension for his government rent and his electricity and gas accounts. These steady payments will clear his accounts in due course. I note that his circumstances certainly are straitened but this is common with persons receiving DSP and must be shown to be unusual, uncommon or exceptional to warrant the removal of the preclusion period.

10.     Section 1169(1) of the Social Security Act 1991 (the Act) provides that where a person receives a “compensation affected payment” and has received a lump sum compensation payment, a preclusion period may apply. Section 17(1)(a) provides that the DSP is such an affected compensation payment, among others. Section 17(2) defines “compensation” to mean a range of payments including damages and payments under insurance and compensation schemes and other payments. Mr Lee’s payment falls within the compensation definition. Section 17(3) applies in Mr Lee’s case. Sectio 17(3)(a) of the Act catches claims which were settled. 50% of the settlement payment is deemed as the compensation part of a lump sum compensation payment by virtue of the settlement. That is, 50% is treated as covering economic loss for the purpose of adjusting pension payments and the preclusion period. Section 1170 gives a formula for working out the length of the preclusion period in this situation. Section 1184K provides a discretion to disregard some payments in special circumstances.

11.     The 50% rule that applies to the compensation provisions and the operation of s 1184K has often been considered by this tribunal and the Federal Court. For example, see Re Beadle and Director-General of Social Security (1984) 6 ALD 1 where Toohey J noted the circumstances must be unusual uncommon or exceptional. In the case of ill health, as was the case put before the tribunal by Mr Lee, increased medical costs and an incapacity to engage in paid employment is relevant to finding special circumstances, see for example Re Evagrew and Director-General of Social Secretary (1983) 16 SSR 161. However, in the present case, Mr Lee has not made the argument that he cannot afford adequate medical care and has been receiving treatment which is illustrated in reports before the tribunal. He has not claimed that he is unable to pay any medical bills.

12.     Overall, it is my impression that the discretion is usually exercised where otherwise there was a clearly unjust result. In my opinion, the non-exercise of the discretion in the present case does not produce an unjust result. I am mindful in remarking this that Centrelink has already adjusted the debt and resultant preclusion period twice on the basis put to me by Mr Lee.

13.     Taking all the circumstances into account, on balance, I do not accept that Mr Lee’s circumstances are so special as to be deserving of the exercise of the available discretion in his favour. While subsection 1184K(1) allows the tribunal to treat the whole or part of a compensation payment as not having been made if the Secretary thinks it appropriate in the special circumstances of a particular case, Mr Lee’s situation does not warrant a further reduction over and above Centrelink’s previous reductions of the amount taken into account in calculating the applicable preclusion period.

decision

14.     The decision under review is affirmed.

I certify that the 14 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member Robin Hunt

Signed:         .....................................................................................
Zoe McDonald
Associate

Date of Hearing: 5 August 2005    
Date of Decision: 24 November 2005
Solicitor for the Applicant: Self 
Solicitor for the Respondent: Centrelink Legal Services