MANKEY v COMMISSIONER FOR SOCIAL HOUSING (Administrative Review)
[2015] ACAT 76
•17 November 2015
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
MANKEY v COMMISSIONER FOR SOCIAL HOUSING (Administrative Review) [2015] ACAT 76
AT 14 of 2015
Catchwords: ADMINISTRATIVE REVIEW – review of decision to reject second level review of rent rebate assessment from 1 November 2009 to 30 March 2011 – second level review recommended applicant’s appeal be upheld – review application out of time - exercise of discretion - exceptional circumstances required before appropriate to grant application – exceptional circumstances - rent rebate backdated
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 (ACT) ss 68, 69
Housing Assistance Act 2007 (ACT) ss 6, 19, 20, 21, 24
Social Security Act (1991) (Cth) s 8
Subordinate
Legislation: Housing Assistance Public Rental Housing Assistance Program 2008 (No. 1) cl. 9, 11, 25, 29
Housing Assistance Public Rental Housing Assistance Program (Exempt Income and Assets) Determination 2012 (No. 1)
Housing Assistance Public Rental Housing Assistance Program (Rent Rebate) Operation Guideline 2008 (No. 1) cl 8
Cases cited:Hedley v Commissioner for Social Housing in the ACT (unreported) [2014] ACAT 72
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24
Shi v Migration Agents Registration Authority (2008) 235 CLR 286
List of
Texts/Papers cited: Rent rebate Policy
Tribunal: Ms E. Symons, Presidential Member
Date of Orders: 17 November 2015
Date of Reasons for Decision: 17 November 2015
ACT CIVIL & ADMINISTRATIVE TRIBUNAL AT 14 of 2015
BETWEEN:DAVID JOHN MANKEY
Applicant
AND: COMMISSIONER FOR SOCIAL HOUSING
Respondent
TRIBUNAL: Ms E. Symons – Presidential Member
DATE:17 November 2015
ORDER
The Tribunal Orders that:
Pursuant to section 68 of the ACT Civil and Administrative Tribunal Act2008 the respondent’s reviewable decision dated 19 December 2014 to deny the applicant’s application for a rent rebate for the period 1 November 2009 to 29 March 2011 is set aside and substituted with the decision to grant the applicant a rent rebate for the period 1 November 2009 to 29 March 2011.
The rent rebate is assessed at $23,306.57.
………………………………..
Ms E. Symons
Presidential Member
REASONS FOR DECISION
Background
The applicant is a tenant of the respondent. The tenancy agreement commenced on 15 October 1995.
The applicant, who is now aged 61, resides with his adult son at the premises.
On 22 September 2003 the applicant’s mother died and in October 2003 the applicant’s brother was granted probate of their late mother’s estate (“the estate”). The applicant inherited shares and cash of $719,454.00 via a Testamentary Trust in 2003. The applicant’s brother was the appointed trustee of the Testamentary Trust (“the Testamentary Trust”) until he retired on 1 April 2004. The applicant acted on advice that he needed to set up a company to administer the Testamentary Trust and the shelf company, Tanalark Pty Ltd, was set up for this purpose. The applicant was the sole director of Tanalark Pty Ltd.
The applicant applied to the respondent for a rent rebate and was granted a rent rebate in January 2004. In his application he stated that he had not received any interest from financial accounts or dividends from investments and that he had not received any lump sum payment from any source.
The applicant applied for and was granted a rent rebate in July 2004. In his application he stated that he had not received any interest from financial accounts or dividends from investments. He declared his savings account balance was $4,000.00.
On 1 September 2004 108 Digital Pty Limited (“the company”) was incorporated. The applicant was a director of the company until 8 May 2007. The shareholders of the company were James Dundee Bostock who held 51 Ordinary Class Shares and Tanalark Pty Ltd which held 49 Ordinary Class Shares.[1] The company traded as a digital design agency providing website, multimedia and online advertising design and development services and was controlled by James Bostock, a personal friend of the applicant. The applicant did not control the operations of the business in any way. The applicant commenced employment with the business on 17 January 2005 and was paid an annual salary of $50,000.00.
[1] Exhibit A1
The applicant acted on advice that to utilise the monies from the Testamentary Trust he needed to set up an investment or trading trust (“the Lily Incoad Trust”) and as trustee for the Lily Incoad Trust the applicant loaned sums of money to the business as working capital without security and without independent legal advice.
The applicant applied for a rent rebate in February 2005 which was approved in March 2005. In his application he stated he had not received any lump sum payment from any source; declared the balance of his savings account was $3,500.00 and he provided a letter stating he was receiving an annual salary of $50,000 from 108 Digital Pty Limited and had commenced employment with the company on 17 January 2005.
On 24 January 2007 the applicant applied for a further rent rebate. In his application he indicated he had received interest from a financial account or dividends from investments and wrote in the application that the details were to be advised.[2] By letter dated 13 March 2007 the respondent requested the applicant provide details of his income for 2006. On 19 April 2007 the applicant provided to the respondent a copy of his pay slip from 108 Digital Pty Limited which identified the applicant was then earning an annual salary of $13,000.00.
[2] See Attachment H of Respondent’s Statement of Facts and Contentions
The respondent approved the applicant’s application on 24 May 2007 and calculated the rebate by deeming the applicant as being in receipt of the Newstart Allowance.
On 26 October 2009 the respondent requested additional information from the applicant about his income. When the information was not provided, pursuant to section 24 of the Housing Assistance Act 2007 (“the HAA”) the respondent decided (“the first decision”) to cease providing the applicant the rent rebate after 30 October 2009.
By 1 September 2009 administrators had been appointed for the company. At this time the company owed the applicant $320,000.00. The company was wound up by February 2011.
By 2009 the cash in the Testamentary Trust had been expended. By 2011 the shares the applicant had inherited had been sold.
Between 1 November 2009 and 30 March 2011 (“the relevant period”) the applicant paid full market rent to the respondent using the sale proceeds from his shares. During the relevant period the applicant attempted to apply for a rent rebate and to have the first decision reviewed.
In 2013 Care Financial Counselling assisted the applicant to write a letter dated 16 August 2013[3] to the respondent requesting rent rebates for the relevant period. In this letter the applicant detailed his financial situation, his mental and personal ill health and his difficulty with communication. He attached copies of his 2009 and 2010 income tax returns and notices of assessments. He had already submitted his 2011 income tax return and assessment to the respondent.
[3] T Docs pages 257-8
The applicant submitted another rent rebate application to the respondent on 14 March 2014 and on 19 March 2014 he was informed in writing that his application for a rent rebate had been approved and he was required to pay a weekly rebated rent of $124.25 from 27 April 2014.
On 13 May 2014 the applicant applied for a First Level Review of the first decision claiming that the respondent had charged him an incorrect amount of rent between 1 November 2009 and 29 March 2011. The applicant stated in the application “I believe that for an extended period I was paying an incorrect amount of rent due to circumstances beyond my control. For this extended period I can now show my full income and ask that a Rent rebate be applied to my account for this period.”[4]
[4] T documents page 297
On 24 June 2014 the respondent completed the First Level Review of Decision regarding the backdating of the applicant’s rebate. The applicant’s appeal was denied (“the second decision”).
On 1 August 2014 the respondent received a request from the applicant for a Second Level Review of the second decision.
The respondent referred the Second Level Review to the Housing Assistance and Tenancy Review Panel (“HATRP”) for consideration.
On 21 August 2014 HATRP reviewed the applicant’s file and recommended that the applicant’s request for a rent rebate backdated to the period between 1 November 2009 and 29 March 2011 be upheld (“the HATRP recommendation”).
On 19 December 2014 the respondent’s delegate informed the applicant in writing that he disagreed with the HATRP recommendation and denied the applicant’s application for rent rebate for the relevant period (“the third decision”). No reason was given for this decision.
The Proceedings
On 9 February 2015 the applicant applied to the tribunal for review of the third decision (“the application”). The applicant stated under why the decision should be reviewed:
The delegate failed to take into account the Applicant’s ongoing medical conditions and the Applicant’s complex financial circumstances during the relevant period (1 November 2009 to 29 March 2011) such that the Applicant was unable to provide the required information to Housing ACT for Housing ACT to determine the correct rent rebate.
On 13 February 2015 the tribunal ordered, pursuant to rule 7 of the ACT Civil and Administrative Tribunal Procedure Rules 2009 (No 2) (ACT), that the time for the making of the application is extended to 9 February 2015.
On 13 February 2015 and on 21 April 2015 the tribunal directed the respondent to file a statement setting out the findings on material questions of fact, referring to the evidence or other material on which those findings were based and giving the reasons for the decision. The respondent filed a Statement of Reasons on 16 March 2015, an Addendum to Statement of Reasons on 10 April 2015 and an amended Statement of Reasons with the tribunal on 12 May 2015.
At a directions hearing on 19 May 2015 a timetable was made for the filing of material each party intended to rely on at the hearing, including witness statements and authorities, and the matter was set down for hearing.
By letter dated 17 July 2015[5] the applicant’s solicitor sought leave to present the applicant’s evidence solely in oral form. The respondent did not oppose this application.
[5] Exhibit A2
In these reasons, a reference to the ‘tribunal’ refers to the ACT Civil and Administrative Tribunal generally or a previous tribunal and ‘Tribunal’ refers to the current member who heard the matter.
The Hearing
The application was heard on 21 September 2015.
The applicant was represented by Ms N Gould, Solicitor, with Canberra Community Law. Mr T Maling, Tribunal Advocate with the Commissioner for Social Housing, appeared for the respondent.
Both parties filed Statements of Facts and Contentions. The respondent had filed the Tribunal Documents (“T Docs”) comprising 510 pages. The T Docs consisted of copies of the documents held by the respondent which relate to the reviewable decision. The applicant gave evidence and was cross-examined. The applicant tendered the following documents:
Exhibit A1
108 Digital Pty Limited (Administrators Appointed) section 439A Corporations Act (Cth) Report
Exhibit A2
Letter to the tribunal from Canberra Community Law 17 July 2015
Exhibit A3
Chronology
Exhibit A4
Housing Assistance Public Rental Housing Assistance Program (Exempt Income and Assets) Determination 2012 No 1
The applicant and respondent each made oral submissions. At the conclusion of the hearing the Tribunal reserved the decision.
Applicant’s contentions
The applicant contends[6]:
(a)The best and preferable decision was not made by the decision maker and the decision should have been to backdate the rent rebate for the relevant period.
(b)There are a number of serious deficits with the respondent’s decision not to uphold the recommendation from HATRP because “the material did not evidence exceptional circumstances warranting a backdate in rent rebate entitlement”; namely:
(i) The respondent has not given any reasons why, despite the extensive medical and other support evidence provided, ‘exceptional circumstances’ have not been demonstrated. There is no indication or reference to the particularities of the evidence in this case to demonstrate that the decision maker has turned his mind to, or even read, the evidence.
(ii) Exceptional circumstances exist to satisfy the rent rebate policy. The medical evidence clearly demonstrates that the applicant’s disability causes him particular and severe difficulties when it comes to processing and managing paperwork and finances. Further, the particular complexity of his financial situation was, in itself, exceptional.
(iii) In the alternative, policy cannot be inflexibly applied without regard to individual merit. The respondent decision maker misunderstands and has not properly applied well established administrative law principles by stating in the Reasons[7] that “the effect of this policy [ie the rent rebate policy] is to interpret cl 25(8)(d) of the PRHAP as applying where a tenant evidences exceptional circumstances” without having regard to a full assessment of the individual merits of the case.
Respondent’s contentions
[6] Applicant’s Statement of Facts and Contentions at [24], [27], [29]
[7] At [34]
The Respondent contends[8]:
[8] Respondent’s Statement of Facts and Contentions at [3]
(a)The exceptional circumstances test is consistent with clause 25(8)(d) of the Housing Assistance Public Rental Housing Assistance Program 2008 (No 1) (“PRHAP”).
(b)Clause 25(8)(d) of PRHAP should not be considered in isolation. The Tribunal should consider clause 11 of the PRHAP and sections 6 and 24 of the Housing Assistance Act 2007 (“HAA”).
(c)In all the circumstances, which include the facts and legislation, the applicant has failed to evidence exceptional circumstances which justify the exercise of discretion at clause 25(8)(d) of PRHAP.
(d)The respondent is required to request and make all appropriate investigations to satisfy itself that an applicant is entitled to receive a rent rebate benefit.
(e)The correct or preferable decision is to confirm the decision of the delegate on 19 December 2014.
Issues
The issue for determination is whether the discretion to be exercised pursuant to clause 25 of the PRHAP should be exercised to provide the applicant with a rent rebate for the period 1 November 2009 to 29 March 2011. This requires the Tribunal to consider exceptional circumstances in the respondent’s policy, PRHAP and the HAA.
The Legislative Framework
Sections 68 and 69 of the ACT Civil and Administrative Tribunal Act 2008 (“the ACAT Act”) set out the tribunal’s power to review decisions:
68Review of decisions
(1)This section applies if the tribunal reviews a decision by an entity.
(2)The tribunal may exercise any function given by an Act to the entity for making the decision.
(3)The tribunal must, by order—
(a)confirm the decision; or
(b)vary the decision; or
(c)set aside the decision and—
(i)make a substitute decision; or
(ii)remit the matter that is the subject of the decision for reconsideration by the decision-maker in accordance with any direction or recommendation of the tribunal.
69Effect of orders for administrative review
(1)This section applies if the tribunal makes an order under section 68 (3) in relation to a decision.
(2)The order—
(a)is taken to be the decision of the decision-maker; and
(b)takes effect from the day the tribunal makes the order, unless the tribunal orders otherwise.
The objects of the HAA are set out in section 6. Subsection 6(2) states:
(2) A person administering this Act must have regard to the objects of the Act to the maximum extent practicable considering the resources available to the person.
Pursuant to section 19 of the HAA the Minister may approve a housing assistance program. At the time, 26 October 2009, the relevant program was the Housing Assistance Public Rental Housing Assistance Program 2008 (No. 1) (“PRHAP”). Clause 29, which was drafted in the same terms as clause 29 of the current version of the PRHAP, permitted the respondent to request further information from an applicant. It stated:
Clause 29 Further information
The housing commissioner may at any time ask an applicant or a community applicant for further information -
(a)in relation to an application; or
(b) to enable the housing commissioner to reassess the eligibility of an eligible applicant or an eligible community applicant to ensure they continue to satisfy the eligibility criteria for a particular form of assistance and are therefore entitled to receive, or in the case of a rent rebate, continue to receive, assistance.
Note 1 Application means an application—
(a) for rental housing assistance; or
(b) facilitation of community rental housing assistance; or
(c)for a rent rebate; or
(d) to have a person’s name returned to the register.
Note 2 The Information Privacy Principles apply to the housing commissioner. Principle 4 states requirements about the storage and security of personal information and principle 11 states when personal information may be disclosed (see Privacy Act 1988 (Cwlth), s 14).
Note 3 Access to information may be sought under the Freedom of Information Act 1989 (which also provides that certain information is exempt from disclosure).
Note 4 If the information is not provided in accordance with a notice under section 24(3) or section 25(2) of the Act the application may be refused.
Note 4 of clause 29 of the PRHAP refers to section 24 of the HAA which provides that the housing commissioner may require further information from an applicant and cease providing a rent rebate on the basis that the information reasonably required was not provided. The section states:
24Housing assistance applicants—requirement for further information
(1)This section applies if an entity applies for housing assistance.
(2)The housing commissioner may require the entity to give the commissioner further stated information that the commissioner reasonably needs to decide the application.
(3)The housing commissioner may, by written notice to the entity, refuse the application if—
(a)the requirement is made in writing; and
(b)the requirement states a reasonable time (of at least 7 days after the day the requirement is given to the entity) for providing the information; and
(c)the entity does not provide the information in accordance with the requirement.
Sub-clause 9(4) of the PRHAP states:
An applicant is eligible for a rent rebate if the applicant satisfies each of the following criteria:
(a) the applicant is receiving rental housing assistance from the housing commissioner under this program; and
(b) the applicant is eligible for a rent rebate in accordance with clause 25.
The respondent has a policy on rent rebates, the Housing ACT Rent rebate Policy[9] (“the policy”). The policy outlines tenant responsibilities in terms of applications for rebates and states:
Application for Rent rebate[10]
An application must be made on the approved form and must contain such information as Housing ACT reasonably requires. Housing ACT may at any time in writing request an applicant to provide further information in connection with an application…
However an application that is not fully completed and does not have all supporting documentation attached should still be accepted and the application date regarded as the date of receipt.
It is the tenant’s responsibility to provide the required information to substantiate the income of all members of their household:· Applying or reapplying for a rent rebate
· …..
Scheduled rebate reviews
…If a tenant does not submit a complete application for rent rebate by the date requested, the existing rebate will be cancelled and market rent will be charged. Housing ACT may investigate a tenant’s circumstances at any time during the currency of a rent rebate period.[11][9] T documents at page 430
[10] T documents at page 433
[11] T documents at page 438
The quantum of rent rebate is determined by a person’s income. Income is defined in clause 11 of the PRHAP as follows:
Clause 11 Meaning of income
(1) For this program, income, for a person—(a)means personal earnings, valuable consideration, profits or any other amounts the person has earned, derived, received or become entitled to, for the person’s own use or benefit, by any means from any source;
and
(b)includes a periodical payment or benefit by way of gift or allowance to the person; and
(c)includes an amount taken to be earned, derived or received by the person under subclause (3); and
(d)includes an entitlement forgone as part of a salary packaging arrangement or any arrangement which has the effect of reducing the person’s taxable income.
(2) However, income, for a person—
(a)does not include income that the housing commissioner determines is not income for the person for this program; and
(b)does not include an amount expended by the person for a purpose determined by the housing commissioner for this program.
(3) For subclause (1) (c), a person may be taken to have earned, derived, received or become entitled to an amount in the following circumstances—
(a)the housing commissioner considers that the person might have earned, derived, received or become entitled to the amount if the person had taken reasonable action to secure the amount and the action is or was reasonably available to the person; or
(b)the person receives a lump sum payment (by compensation or otherwise)—the housing commissioner considers the payment to be wholly or partly on account of income lost or foregone by the person during a period (before or after the person receives the payment, or both); or
(c)where the person is a self-employed person, the housing commissioner may deem the person to be receiving an amount equivalent to a relevant pension or benefit where the person’s stated income is less than the relevant pension or benefit.
(4) For subclause (3) (b), the amount the person is taken to have earned, derived, received or become entitled to is not more than the amount of the lump sum, or the part of it that the housing commissioner considers to be income lost or foregone in the period, distributed in equal weekly payments over the period.
(5) Despite any other provision of this program, any income of a person (other than an applicant, a tenant or a domestic partner of a tenant) whose weekly income is less than $100 is not income for this program.
In the Social Security Act 1991 (Cth) ‘income’ and ‘income amounts’ are defined in section 8 as follows:
income, in relation to a person, means:
(a) an income amount earned, derived or received by the person for the person’s own use or benefit; or
(b) a periodical payment by way of gift or allowance; or
(c) a periodical benefit by way of gift or allowance;
but does not include an amount that is excluded under subsection (4), (5) or (8).
income amount means:
(a) valuable consideration; or
(b) personal earnings; or
(c) moneys; or
(d) profits;
(whether of a capital nature or not).
Pursuant to section 20 of the HAA the housing commissioner made the Housing Assistance Public Rental Housing Assistance Program (Exempt Income and Assets) Determination 2012 (No 1) which, relevantly for this decision, identifies exempt income.
Pursuant to section 21 of the HAA the housing commissioner issued operational guidelines, Housing Assistance Public Rental Housing Assistance Program (Rent Rebate) Operation Guideline 2008 (No. 1)(“Rebate Operational Guideline”), to provide guidance on clause 25 - Rent Rebate - of the PRHAP. Subclause 25(8) of the PRHAP permits provision of a rent rebate from an earlier date decided by the respondent. It states:
25 (8) Provision of a rent rebate takes effect from—
(a) the expiry of any previous provision of a rent rebate; or
(b) the date of application for the rent rebate; or(c) if the tenant was receiving a rent rebate immediately before the application and the housing commissioner determines that the rent rebate has increased—a date, decided by the housing commissioner, not more than 2 weeks before the date of application; or
(d)from an earlier date in circumstances decided by the housing commissioner.
Clause 8 of the Rebate Operational Guideline provides for when the provision of a rent rebate commences. It states:
Date of effect
8. Subclause 25(8) specifies the date of effect for granting a rent rebate.
This includes provision for a date earlier than would normally apply
where particular circumstances exist. These would include
circumstances that are unusual or out of the ordinary, such as:· where a tenant was unconscious in hospital and could not contact
Housing ACT to make them aware of their situation; or
· where a tenant has been called away unexpectedly because of a
death or serious illness of an immediate family member.
The policy states under the “Date of Effect of Entitlement” that a rent rebate takes effect from the expiry of any previous grant of rebate, or the date of application for rebate, or if the tenant or occupant was receiving rent rebate immediately before the application and the Housing Commissioner determines that the rebate has increased - a date decided by the Housing Commissioner, not more than 2 weeks before the date of the application; or (d) if the Housing Commissioner is satisfied that exceptional circumstances exist - from an earlier date decided by the Housing Commissioner.[12]
Consideration
[12] T documents at pages 437-438
The Tribunal’s powers to review a decision are identified in section 68 of the ACAT Act. In reviewing the decision of an entity the Tribunal conducts a merits review. The respondent referred the Tribunal to the High Court decision in Shi v Migration Agents Registration Authority[13](“Shi”) where Kiefel J described the function of the Administrative Appeals Tribunal:
The term “merits review” does not appear in the AAT Act, although it is often used to explain that the function of the Tribunal extends beyond a review for legal error, to a consideration of the facts and circumstances relevant to the decision. The object of the review undertaken by the Tribunal has been said to be to determine what the “correct or preferable decision” is. “Preferable” is apt to refer to a decision which involves discretionary considerations. A “correct” decision, in the context of review, might be taken to be one rightly made, in the proper sense. It is, inevitably, a decision by the original decision-maker with which the Tribunal agrees. Smithers J, in Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd, ((1979) 24 ALR 307 at 335) said that it is for the Tribunal to determine whether the decision is acceptable, when tested against the requirements of good government.
[13] (2008) 235 CLR 286, [140]
In conducting a merits review of the delegate of the respondent’s decision of 19 December 2014 the Tribunal may have regard to relevant information leading up to this decision, and any other information available to the Tribunal.[14]
[14] Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, 45
Pursuant to clause 25 of the PRHAP the respondent, and therefore the Tribunal, is authorised to exercise the discretion to grant a rent rebate provided, as a prerequisite, the tenant satisfies the eligibility criteria in clause 9(4) and clause 25.
Clause 25(8)(d) of the PRHAP states that the circumstances in which the rebate can take effect from an earlier date are “in circumstances decided by the housing commissioner.” It provides a wide discretion. Clause 8 of the Rebate Operational Guidelines provides some assistance where it describes ‘particular circumstances’ as including ‘circumstances that are unusual or out of the ordinary’. One of the examples given is “Where a tenant has been called away unexpectedly because of a death or serious illness of an immediate family member.” The policy, under Date of Effect of Entitlement, refers to the housing commissioner, here the Tribunal, being “satisfied that exceptional circumstances exist.”
As stated in Hedley v Commissioner for Social Housing in the ACT[15]:
Whilst the Tribunal notes that it is not bound by the Policy, the Tribunal accepts that, in the circumstances presented by this matter, there would need to be exceptional circumstances before it could be considered appropriate to grant the applicant’s application.
[15] [2014] ACAT 72, at [56]
The Tribunal now considers the evidence in relation to the exceptional circumstances relied on by the applicant.
There is no dispute and the Tribunal finds that the applicant has had diagnosed health problems since at least 1993 which require ongoing treatment and medication. His current diagnoses include adult ADHD, depression and anxiety.
In his request for a second level review, dated 1 August 2014, the applicant has detailed his medical history, diagnoses and the ‘paralysing and crippling effect’ of what he describes as ‘an unseen illness’, attention deficit disorder, on his ability to function and on his life. He attached eight medical reports to his request which support the applicant’s history of the impact of his illnesses on his life which he had detailed in his request for review. The Tribunal accepts the following statements in the applicant’s Statement of Facts and Contentions[16] and finds that:
[16] Applicant’s Statement of Facts and Contentions at [3] and [4]
The consensus of the medical evidence is that the Applicant presents with a particularly severe form of Attention Deficit Disorder resulting in medical professional describing Mr Mankey’s symptoms as including:
a.Inattention and impulsivity[17]
b.Disorganisation[18]
c.Depression and chronic fatigue[19]
d.Problems of organization, focus and non-completion of multiple tasks[20]
e.Disturbances of attention and concentration as well as affective disorder[21]
f.Inability to manage money well[22]
The medical evidence paints a uniform picture of disorganization leading to difficulties in managing financial affairs and complex paperwork.
[17] T documents page 362
[18] T documents at page 357 and 361
[19] T documents page 361
[20] T documents at page 355
[21] T documents page 352
[22] T documents at pages 355-356 and 361
The Tribunal noted that the financial counsellor, Leasa Mayes from CARE inc, stated in her letter to the respondent dated 1 August 2014[23] that she had observed the applicant’s difficulties with reading and responding to paperwork and deadlines. His solicitor was given leave by the tribunal to present the applicant’s evidence in oral form at the hearing based on his being unable to read or listen to a statement and then focus for long enough to confirm or amend its contents.
[23] T documents at page 351
The applicant’s evidence at the hearing painted the same bleak picture of his health and of the symptoms referred to in [54] and [55] above. He gave evidence of the attempts he had made to obtain the relevant paperwork for the respondent which included, in 2010, his seeking assistance from an accountant at Territory Accountancy to prepare his 2009 income tax return. This accountant notified the respondent by letter dated 15 June 2010[24] that the applicant’s 2009 Tax will include $0.01 interest received and a non-commercial loss in the region of $9,000.00. This letter also stated:
MR MANKEY has received no Trust Fund Entitlements during the 2009 financial year; however, funds were received by way of loans that have not been repaid at this time.
[24] T documents at page 307
This accountant became ill before finalising the applicant’s 2009 tax return and was unable to continue assisting the applicant. The applicant sought help from CARE Inc. who referred him to another accountant, Scott Ellis CPA, who was able to finalise his outstanding tax returns to this accountant’s satisfaction. The accountant lodged the applicant’s 2009 tax return and his 2010 tax return on 1 July 2013 with the Australian Taxation Office and Notices of Assessment issued on 9 July 2013. His 2009 taxable income was $17,089 and his 2010 taxable income was $26,967.00. His 2011 Notice of Assessment had issued on 25 November 2011 and his taxable income was $11,342.00.
Scott Ellis also wrote to the respondent on 16 December 2013[25] and succinctly set out the relevant details of the Testamentary Trust and the Trading Trust. That letter stated:
David John Mankey Testamentary Trust
We wish to confirm that the David John Mankey Testamentary Trust was created on the 22 September 2003. $719,454 was distributed to the estate on the death of the Late Mrs. Muriel Mankey. By the 17 October 2010 the Trust had only $31,726 in Shares which have been sold to pay the rent in the last few years. Due to a medical condition that is referenced (attached) Mr Mankey spent the money or Invested in Small Business that has subsequently become insolvent. The income from the trust in the years 2010, 2011, 2012 and 2013 was negligible. One company that Mr Mankey invested in 108 Digital Pty Ltd ceased trading by the year ended 30 June 2009. The financial reports prepared by Territory Accountancy show that no trust entitlements have been received since one July 2008. We also wish to confirm that the Lily Incoad Trust has held no assets and had no income in the years 2005-2012.[25] T documents page 298
In May 2013 the applicant had provided the respondent with copies of all relevant correspondence and documents including letters from his accountant[26]; the estate’s solicitor[27]; his 2009, 2010[28] and 2011 Tax Returns and 2010 Capital Gains Tax Schedules[29]; 2010 Tax Estimate[30]; 2010 Additional Tax Information[31]; Notices of Assessments[32]; a Tax Agent Portal printout (Lily Incoad Trust) 1 July 2013[33]; an ABN search (Lily Incoad Trust) 18 May 2012[34]; an ASIC Register search printout 16 December 2013 (108 Digital Pty Limited)[35]; and his Centrelink Profit and Loss Statement 1 July 2011 to 1 July 2012 and signed 29 November 2012[36].
[26] T documents page 298 and page 307
[27] T documents at pages 299-301 and 302-304
[28] T documents at pages 313-324
[29] T documents at page 325, 328-331
[30] T documents at page 326
[31] T documents at page 327
[32] T documents at pages 332-335
[33] T documents at pages 305-306
[34] T documents at page 309
[35] T documents at page 308
[36] T documents at pages 310 and 332
With his request for second level review dated 1 August 2014 the applicant provided the respondent with his detailed letter in support[37]; a letter from CARE Inc. dated 1 August 2014[38]; a medical report from Dr Stephen Rosenman dated 15 July 2014[39]; a medical report from Dr Tamara Punchihewa dated 9 November 2011[40]; a medical report from Dr Stephen Rosenman dated 25 June 2012[41]; a medical report from Dr Tamara Punchihewa dated 23 January 2014[42]; a medical report from Dr Bruce Lean dated 24 January 2014[43]; a medical report from Dr Tamara Punchihewa dated 23 December 2010[44]; a letter from Dr Marie-Ange Nambiar dated 12 April 2007[45]; a medical report from Dr Robert Tym dated 18 October 2011[46]; a Centrelink medical certificate dated 4 December 2010[47]; a Centrelink Newstart Allowance Statement 14 April 2014[48]; letter from ACAT about electricity and gas matters dated 5 March 2014[49]; letter from Centrelink dated 28 February 2014 regarding suspension of his Newstart Allowance[50]; letter from Centrelink dated 15 April 2014 regarding suspension of his Newstart Allowance[51]; a Tax Help Disclaimer dated 30 October 2012[52] and articles on Adult ADHD[53].
[37] T documents at pages 345-350
[38] T documents at page 351
[39] T documents at page 352
[40] T documents at pages 353-354
[41] T documents at pages 355-356
[42] T documents at page 357
[43] T documents at pages 358-359
[44] T documents at page 360
[45] T documents at page 361
[46] T documents at page 362
[47] T documents at page 366
[48] T documents at page 363
[49] T documents at page 364
[50] T documents at page 365
[51] T documents at page 367
[52] T documents at pages 368-370
[53] T documents at pages 371-374
On 20 August 2014 the applicant provided the following further information for the HATRP review: his letter[54]; a referral form for dental services under Medicare dated 14 November 2011[55]; a Form dated 9 November 2011 listing his medical problems[56]; Centrelink Medical Certificate dated 4 December 2010[57]; a medical report from Dr Stephen Rosenman dated 15 July 2014[58]; a medical report from Dr Tamara Punchihewa dated 16 July 2014[59]; a medical report from Dr Tamara Punchihewa dated 9 November 2011[60]; Notice of Revocation (Special Circumstances) Infringement Court, Magistrates’ Court Victoria dated 11 June 2014[61]; Depression/Anxiety Disorder GP Management Plan dated 14 November 2011[62]; letter from the Australian Taxation Office regarding superannuation 108 Digital Pty Limited (undated)[63]; (part) Company Statement – Tanalark Pty Ltd[64] and ASIC Invoice – Tanalark Pty Ltd 26 February 2014[65].
[54] T documents at pages 375-379
[55] T documents at page 380
[56] T documents at page 381-382
[57] T documents at page 383;
[58] T documents at page 384
[59] T documents at page 385
[60] T documents at pages 386-387
[61] T documents at page 388
[62] T documents at pages 389-391
[63] T documents at page 392
[64] T documents at page 393
[65] T documents at pages 394-39
On 21 August 2014 he provided the respondent with his 8 page handwritten statement[66] for the HATRP review. An engrossed copy of this statement was Exhibit A3.
[66] T documents pages 397-405
The HATRP review recommended on 21 August 2014 that the applicant’s request for rent rebate backdate for the relevant period be upheld. Relevantly that panel noted in its Report under Reasons for Recommendations[67]:
· The original decision by tenancy operations does not demonstrate an understanding of the medical evidence provided by Mr Mankey to confirm his mental health status.
· Mr Mankey demonstrates a limited ability to effectively communicate and respond to paper based processes.
· Mr Mankey has provided significant medical evidence of his condition.
· There is no evidence on file to advise if Mr Mankey is engaging with any support services for his mental health.
· Mr Mankey has engaged with CARE Financial Services.
· Mr Mankey has demonstrated his commitment to sustaining his tenancy by maintaining regular rental payments.
· Housing ACT has made attempts to assist Mr Mankey however these attempts have not been effective due to a continued reliance on Mr Mankey responding to and providing written information.
· ….
[67] T documents at page 415
The Tribunal noted that the applicant continued to pay his non-rebated rent throughout the period his requests were being reviewed. He said he did so by selling down the inherited shares.
The Tribunal found the applicant to be a credible witness. He provided significant medical evidence of his mental health condition, which was diagnosed in 1993 as moderate to severe ADD and in 2007 included depression and chronic fatigue which has caused him to be very disorganised with his personal and particularly his financial affairs[68]. Dr Rosenman wrote in June 2012[69] that his ‘symptoms mostly are problems of organization, focus and non-completion of multiple tasks’ and in July 2014[70]:
he has a complex disorder which involves disturbance of attention and concentration as well as affective disorder’ and ‘Despite the medication he takes, there are still deficits that make it very difficult to manage the documentation that is required in his application paperwork.’
His general practitioner had prepared a Mental Health Plan for the applicant in November 2011. The Tribunal had no hesitation accepting the medical evidence and the applicant’s evidence of the impact of his mental health conditions on his day to day life.
[68] Dr MAL Nambiar 12 April 2007 report at T Documents at page 361
[69] T Documents at page 355
[70] T documents at page 352
The Tribunal further noted the applicant’s evidence of his limited understanding of the complex financial matters which commenced with his late mother’s estate and the Testamentary Trust in 2003. He was left with a substantial inheritance which was tied up in a Testamentary Trust and with a trustee who wished to and did resign from 1 April 2004. It appeared that the applicant, without getting his own legal advice, but believing he needed to appoint a company as a replacement trustee of the Testamentary Trust, arranged for a local accountancy firm to set up Tanalark Pty Ltd for this purpose.
Subsequently, when he and his friend were setting up 108 Digital Pty Limited, the applicant demonstrated his impulsivity and inability to manage money by following his friend’s recommendation and arranging for another accountancy firm to set up an investment trust, The Lily Incoad Trust, without getting his own legal advice. Through these trusts a significant sum of the trust monies was loaned without security to 108 Digital Pty Limited to provide working capital. The trustee company, Tanalark Pty Ltd, was the minority shareholder in the company and had no control over it. The applicant was earning a wage which reduced from $50,000.00 pa to $13,000.00 pa while working in the business operated by the company. The company operated at a loss for each of the financial years ending 30 June 2005, 30 June 2006 and 30 June 2008. It made a net operating profit of $29,402 in the 2006/2007 financial year. The company had a net asset deficiency from at least 2006.[71] The business failed and the company was wound up. None of the funds loaned to the company were recovered.
[71] Exhibit A1 at 4.1.1
The respondent highlighted at the hearing that there was a dearth of evidence from the accountants who set up Tanalark Pty Ltd and the accountants who set up The Lily Incoad Trust. The Tribunal is not satisfied that this lack of corroborative evidence is fatal to the application. These events significantly predated the relevant period which is the subject of this review. Further, to a large extent the lack of this evidence was overcome by the letters to the respondent from Scott Ellis CPA and from Territory Accountancy.
While the respondent also queried whether the applicant had received any income from his significant inheritance the applicant’s tax returns for the relevant period have been lodged and Notices of Assessment have issued which provide the answers to the respondent’s query. The applicant’s taxable income in the 2008/2009 financial year was $17,089, for the 2009/2010 financial year $26,967, for the 2010/2011 financial year $11,342 and was mostly derived from capital gains from the sale of shares which paid the applicant’s market rent during the relevant period as the applicant was not receiving any Centrelink payments.
The question for the Tribunal is whether it should exercise the discretion in clause 25 of PRHAP, guided by the Housing ACT Rent rebate Policy, and backdate the rent rebate for the relevant period.
The respondent submitted[72] and the Tribunal agrees that in determining the presence of exceptional circumstances, the Tribunal must have regard to the main objects of the HAA. These include a focus on targeting assistance to those most in need and maximising the opportunities available to the ACT community to access affordable housing.
[72] Respondent’s Statement of Facts and Contentions at [23]
The Tribunal has no hesitation in accepting the unchallenged and detailed medical evidence and the applicant’s own evidence of the paralysing and crippling effects of ADD on his life. His letter to the respondent dated 1 August 2014 seeking the second level review[73] and his handwritten letter provided to the respondent on 21 August 2014 amply describe these effects. All of this evidence provides a credible and sufficient explanation as to why the requested financial information was not provided in a timely manner by the applicant.
[73] T Documents at ‘AK’
The respondent’s submission[74] that the applicant’s complex health needs did not prevent him from engaging with appropriately qualified agents, such as Mr Scott Ellis, CPA, does not properly acknowledge the intervention and assistance of Care Financial Counselling (Care Inc) who in 2013 were instrumental in referring the applicant to Mr Ellis who, in turn, assisted the applicant get together the information needed for processing his rebate belatedly. The Tribunal is satisfied and finds that the applicant was suffering, at the relevant time, from a disabling illness which derailed his day to day life and particularly limited his ability to effectively communicate and respond to paper based processes.
[74] Respondent’s Statement of Facts and Contentions at [33]
While the Tribunal noted that the respondent’s staff had numerous meetings with the applicant and that he tried to explain his situation orally to them, he was left in no doubt that he needed to present the relevant information in paper form. This became a Catch 22 because of his medical conditions and the complexity of his financial situation. The fact is that the applicant was able, with Mr Ellis’s assistance, to provide the relevant Tax Returns to the respondent. Mr Ellis also provided the respondent with a helpful letter[75] in relation to the Trusts which corroborated the applicant’s evidence. The applicant’s solicitor contends[76] and the Tribunal agrees, that the Tax Returns indicate what the applicant had tried to explain to the respondent on numerous occasions – that he was in fact entitled to a rent rebate throughout the relevant period.
[75] T Documents at page 298
[76] Applicant’s Submissions in Reply at [15]
The applicant does not dispute that until he submitted his Tax Returns the respondent did not have enough information to grant a rent rebate. He has presented compelling evidence of the impact of his mental condition and disability on him which caused his delay in submitting the Tax Returns. The Tax Returns have been provided to the respondent. Notices of Assessments have issued. The Tax Returns provide sufficient detail and proof of income. The applicant says that the respondent has the necessary information to determine the applicant’s entitlement during the relevant period; the respondent has the power to backdate a rent rebate; the respondent has had the relevant medical information and the applicant’s reasons for the delay and now requests the Tribunal consider all of that information and grant the application.
Having considered all of the evidence, the HAA, clauses 9, 11 and 25(8)(d) of the PRHAP, the Rebate Operation Guideline, the policy, and the individual merits of the application, and for the reasons set out above the Tribunal is satisfied and finds that there are exceptional circumstances which enable the Tribunal to exercise its discretion and to determine that the applicant be granted a rent rebate for the period between 1 November 2009 and 29 March 2011.
Quantum of rent rebate
The quantum of the rent rebate is determined by a person’s income; there is no asset test for this calculation. The Tribunal has set out clause 11 of the PRHAP in [47] above which defines ‘income’ and the definition of ‘income’ and ‘income amount’ in section 8 of the Social Security Act 1991 (Cth).
The Exempt Income and Assets Determination sets out the various classes of income and assets that are to be disregarded for the purposes of the PRHAP.
The respondent contends that ‘an amount which a person appears to have received for their benefit is assessable for rebate purposes and, in this matter, there is and remains a distinct absence of information regarding the trust income and distributions’.[77] The respondent also refers to the applicant’s earlier applications for a rent rebate in 2004 in which he stated he had not received any interest from financial accounts or dividends from investments.
[77] Respondent’s Statement of Facts and Contentions at [39]
The applicant does not dispute that any income the applicant received from the testamentary trust would be relevant for assessing the rent rebate and that until 2013 the respondent did not have the Taxation Returns which set out this information.
The Tribunal is satisfied from considering all of the evidence that the applicant did not invest the trust monies in interest bearing deposits. Therefore, he did not receive interest. It was correct to state in his 2004 rent rebate applications that he was not receiving interest from financial accounts.
The trust monies loaned to 108 Digital Pty Limited were never repaid. While the section 439A Corporations Act 2001 (Cth) Report[78] states that repayments for the loans were made from 2007 and in April 2009 reduced to $100 a week, administrators were appointed on 1 September 2009. The applicant indicated in his rent rebate application on 24 January 2007 that he had received interest or dividends from any investment in the past year.
[78] Exhibit A1 at 6.5
The applicant submitted that the applicant’s inheritance is not ‘income’ but an ‘asset’ and referred[79] the Tribunal to the Guide to Social Security Law at 4.3.2.30 and 4.3.9.50 –
Legacies
Amounts received by way of a legacy or inheritance is NOT treated as income whether received as a lump sum or by instalments.Explanation: All payments of a legacy are considered to be one-time, lump sum payments and not payments of a recurring nature.
[79] Applicant’s Submissions in Reply at [7]
The Tribunal is satisfied and finds that the money inherited by the applicant was a one-time lump sum payment, and an asset. It was not a periodical or recurring payment. Further, the Tribunal is satisfied and finds that a ‘spend down’ of an asset is not income. The applicant realised capital gains on the sale of the shares he had inherited to pay his market rent. The capital gains are disclosed in his Tax Returns. The Exempt Income and Assets Determination states that ‘Capital gains realised’ is a class of income and assets which is to be disregarded for the purposes of the PRHAP.
The Tribunal is not, in reviewing the decision not to back date the rent rebate, determining whether there was enough information at the time the applicant applied for the rent rebate. There is no dispute that the respondent did not have enough information to grant the rebate at that time.
The respondent has had the applicant’s Tax Returns[80] since, at the latest, 2013. The applicant contends and the Tribunal agrees that since that time the respondent has had enough information to indicate that the applicant was entitled to a rent rebate during the relevant period.
[80] T documents at pages 333 -335
The Tribunal requested the parties to file a draft estimate of the applicant’s rebate entitlement. The parties provided the Tribunal with an estimated adjustment taking into account capital gains of $20,167.47 and an estimated adjustment excluding capital gains and deeming Newstart of $23,306.57.
For the reasons set out above, the Tribunal is satisfied that capital gains realised are to be disregarded.
Conclusion
The Tribunal has already considered all of the evidence, the legislation and its objects, the PRHAP and its objects, the Rebate Operation Guideline, the policy, and the individual merits of the application and for the reasons set out in that paragraph found that exceptional circumstances existed for the applicant.
The Tribunal’s decision is that the respondent’s reviewable decision dated 19 December 2014 to deny the applicant’s application for a rent rebate for the period 1 November 2009 to 29 March 2011 is set aside and substituted with the decision to grant the applicant a rent rebate for the period 1 November 2009 to 29 March 2011. The amount of the rent rebate payable to the applicant is $23,306.57.
………………………………..
Ms E. Symons
Presidential Member
HEARING DETAILS
FILE NUMBER: | AT 15/14 |
PARTIES, APPLICANT: | DAVID JOHN MANKEY |
PARTIES, RESPONDENT: | COMMISSIONER FOR SOCIAL HOUSING |
COUNSEL APPEARING, APPLICANT | N/A |
COUNSEL APPEARING, RESPONDENT | N/A |
SOLICITORS FOR APPLICANT | CANBERRA COMMUNITY LAW |
ADVOCATE FOR RESPONDENT | MR T MALING |
TRIBUNAL MEMBERS: | MS E. SYMONS |
DATES OF HEARING: | 21 SEPTEMBER 2015 |