Mattarollo and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
[2010] AATA 235
•23 March 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 235
ADMINISTRATIVE APPEALS TRIBUNAL )
) No: 2009/4238
GENERAL ADMINISTRATIVE DIVISION )
ReDaniel Mattarollo
Applicant
AndSecretary, Department of Families, Housing, Community Services and Indigenous Affairs
Respondent
DECISION
TribunalMr RP Handley, Deputy President
Date23 March 2010
PlaceSydney
DecisionThe Tribunal sets aside the decision under review and substitutes a decision that the debt raised against Mr Mattarollo is written off pending further assessment of his situation at a later date.
...................[sgd]......................
Mr RP Handley
Deputy President
CATCHWORDS
SOCIAL SECUURITY – disability support pension – overpayment – member of a couple – whether special circumstances – chronic medical conditions – homelessness - decision under review set aside
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RELEVANT ACT
Social Security Act 1991: ss 1223, 1236, 1237A, 1237AAD
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CITATIONS
Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435
Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9; (2007) 44 AAR 436; [2007] FCA 25
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REASONS FOR DECISION
| 1 April 2010 | Mr RP Handley, Deputy President |
Daniel Mattarollo has applied to the Tribunal for review of a decision of the Social Security Appeals Tribunal (the SSAT) to affirm a decision to raise and recover an overpayment of disability support pension (DSP) of $26,521.18 for the period 28 September 2005 to 21 October 2008.
The issues before the Tribunal are, first, whether an overpayment was made and whether Mr Mattarollo received the benefit of the overpayment, and, second, if there is a debt due to the Commonwealth, whether Mr Mattarollo should be required to repay the debt, and, in particular, whether his circumstances warrant write-off or waiver of the debt.
Background
Mr Mattarollo is aged 52 and currently receiving a DSP. He has various medical problems, some arising from serious injuries in a motorcycle accident in 1984. He has lost the sight of one eye and now uses a prosthesis, and suffers from spinal and skin problems, a hernia, cardiac arrhythmia and depression.
On 6 May 2003, Mr Mattarollo applied for a DSP stating that he did not have a partner (including a spouse or de facto) and was granted a DSP at the single rate from 7 May 2003. On 15 July 2004 and 6 December 2004, Centrelink wrote to Mr Mattarollo informing him of his obligation to notify Centrelink of any change in his circumstances including his marrying or starting living with someone as if he was married.
On 31 January 2005, Centrelink wrote to Mr Mattarollo asking him to complete a form updating his current circumstances. On 20 May 2005, Mr Mattarollo completed a ‘Partner details’ form stating that he had been in a de facto relationship with Sandra Torres since 28 June 2002 when she had arrived in Australia from Argentina. On 7 June 2005 and again on 10 June 2005, Centrelink wrote to Mr Mattarollo informing him that from 20 May 2005 he would be paid DSP at the single rate because, although he had a partner, she was not a permanent resident and therefore not residentially qualified for a social security payment. In this letter, Centrelink also notified Mr Mattarollo that he should inform Centrelink if his partner started receiving any income or income support payment as this might affect his eligibility to receive DSP at the single rate.
On 5 October 2005, Ms Torres commenced casual employment with the Windgap Foundation. On 3 November 2006, she was granted a spouse visa and became an Australian permanent resident. Between May 2007 and July 2008, Centrelink sent Mr Mattarollo letters approximately quarterly requiring him to notify Centrelink if, amongst other things, details of Ms Torres’ income changed. Mr Mattarollo claims that on a number of occasions when he phoned Centrelink after receiving the letter dated 7 June 2005, he told Centrelink officers that Ms Torres was working. However, he never knew how much she was earning because she did not divulge this information to him and she refused to have any contact with Centrelink.
On 7 August 2008, Centrelink wrote to Mr Mattarollo stating that it was conducting a review of his DSP and requesting that he complete the enclosed review form. When he did not return the form, Centrelink phoned on 9 September 2008 and discussed his circumstances with Mr Mattarollo, who said that Ms Torres had been working on and off since she had been granted a spouse visa in November 2006. Mr Mattarollo subsequently completed an ‘Assessment of Living Arrangements’ form on 15 September 2008.
Centrelink obtained information from the Australian Taxation Office (ATO) about Ms Torres’ earnings showing a taxable income of $39,815 in the financial year 1 July 2006 to 30 June 2007. Information obtained by Centrelink from the Windgap Foundation confirmed Ms Torres’ employment and provided details of her earnings in the period since 5 October 2005.
Mr Mattarollo’s de facto relationship with Ms Torres ended on 4 November 2008 when she left Australia for an overseas visit. It did not resume when she returned to Australia.
On 3 March 2009, a Centrelink officer decided to raise and recover a debt of $30,334.22 from Mr Moss in respect of an overpayment of DSP in the period 28 September 2005 to 21 October 2008. Centrelink states that this occurred because Ms Torres’ earnings were not taken into account in determining the rate of DSP to which he was entitled from 28 September 2005, and because after Ms Torres was granted a spouse visa and became a permanent resident on 3 November 2006, he was only entitled to be paid DSP at the married rate which for one partner in a de facto relationship is less than the single rate of pension.
On 5 June 2009, the original decision was varied by an authorised review officer who reduced the debt to $26,521.18. On a further review on 4 August 2009, the SSAT affirmed the authorised review officer’s decision and, on 8 September 2009, Mr Mattarollo applied to the Tribunal for a review of the SSAT decision.
Legislative Background
Section 1223(1) of the Social Security Act 1991 (the Act) states that if a social security payment is made and a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit, the amount paid is a debt due to the Commonwealth by the person and is taken to arise when the person obtains the benefit. The Act provides for recovery of debts but also allows for debts to be written off or waived in certain limited circumstances. If a debt is written off this means that recovery action will be postponed either for a stated period or otherwise. Then, for example, if a person’s financial situation improves and the person has a capacity to repay the debt, even if only by way of instalments, recovery of the debt may be resumed. If a debt is waived, this means the debt ceases to exist.
Section 1236 of the Act permits a debt to be written off only if the debt is irrecoverable at law, the debtor has no capacity to repay the debt, the debtor’s whereabouts are unknown, or if the debtor is not receiving a social security payment and it is not cost effective for the Commonwealth to take action to recover the debt.
Section 1237A permits a debt to be waived if the debt is attributable solely to administrative error by the Commonwealth and the person received the payments that gave rise to the overpayment in good faith. Section 1237AAD permits a debt to be waived if there are special circumstances:
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 a false representation; or
(ii)failing or omitting to comply with a provision of this Act, the Administration 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.
The first requirement of s 1237AAD is that the debt did not result from the debtor or another person ‘knowingly’ making a false statement or representation or failing or omitting to comply with a provision of the social security legislation. ‘Knowingly’ requires that there be actual knowledge: Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435 at 443. The second requirement is that there are special circumstances other than financial hardship alone that make it desirable to waive the debt. In Angelakos v Secretary, Department of Employmentand Workplace Relations (2007) 100 ALD 9, at [33], Besanko J, having reviewed the relevant authorities in which the meaning of the words ‘special circumstances’ was discussed, emphasised the need for flexibility in determining what constitutes special circumstances, but said that the test would be overstated if the word ‘exceptional’ is emphasised. He said:
There is less risk of overstatement if the words ‘unusual’ or ‘uncommon’ are emphasised. Those words indicate, correctly in my view, the fact that there must be something that distinguishes the case from the ordinary or usual case.
Mr Mattarollo’s Case
Mr Mattarollo said his relationship with Ms Torres was already faltering in 2005. His marriage of 18 years having failed and having been divorced, he found it very difficult to face the prospect of his relationship with Ms Torres failing. When he completed the ‘Assessment of Living Arrangements’ form in September 2008, it was in the hope that his relationship with Ms Torres might improve. In reality, their relationship had worsened to the extent that they were strangers. Because of his disabilities, he needed her help with simple things such as putting cream on his back for his skin condition because he is unable to do this for himself.
Mr Mattarollo said he and Ms Torres only ever shared expenses and she never supported him financially. When she was living in the same flat, she shared the small second bedroom with him and they each paid $150 a week in rent to Michael Hatzidis with whom they shared the flat. Sometimes, they would not share the same bed and he would sleep in his campervan. The flat was an expensive (Eastern suburbs) flat to rent and Mr Hatzidis, who is a friend, was supportive of Mr Mattarollo. However, Mr Hatzidis never gave him a rent receipt and wanted nothing to do with Centrelink. So on the two occasions when Mr Mattarollo applied for rent assistance, without confirmation of the rent from Mr Hatzidis, Mr Mattarollo’s application was refused.
Mr Mattarollo said he would also share living expenses with Ms Torres. For example, when she used his car, she would pay for the petrol. On occasion, if Mr Mattarollo ran out of money, she might buy food for them to share but she never gave him money for his support.
Although Mr Mattarollo knew Ms Torres was working, he did not know how much she was earning. She avoided all contact with Centrelink because she was worried about her status in Australia and refused to supply information about her income. He thought he would spoil his relationship with Ms Torres if he pressed her for details of her earnings. It was also only later he discovered she was sending money home to her family in Argentina. Mr Mattarollo said he informed Centrelink by phone on a number of occasions that Ms Torres was working after receiving the regular letters from Centrelink informing him of his obligations to notify it of any change of circumstances. He also went into Centrelink’s Maroubra office on one occasion to provide this information. However, he did not ask for the information to be recorded. Instead, he was mistreated and told that his pension would be cut.
Mr Mattarollo noted the SSAT’s comment that he has memory problems and gets confused, which he denied. He said that at the SSAT hearing, he was focused on procedures and had not sought help from a lawyer at that time. He subsequently obtained some help from a lawyer at the Kingsford Legal Centre at the University of NSW in drafting the letter he sent to the Tribunal with his application for review.
Mr Mattarollo said he now feels “used”. He helped Ms Torres obtain a spouse visa and has been left with a debt of over $26,000 which is not his and which he cannot explain. If he had known that completing the ‘Assessment of Living Arrangements’ form in the way that he did would result in this debt, he would have completed it differently. As it is, it will take him the rest of his life to repay the debt. He feels this is paralysing and that he cannot go any lower unless he is dying. He was a successful international ski instructor.; now his life has crumbled. He cannot work and his life is constant pain and depression. Because of the way he has been treated, he does not want the pension any more. He would rather give it back and rely on charity.
Mr Mattarollo said although he was paying $150 a week in rent in 2008, it subsequently went up to $200 per week and recently to $265 per week. He could not afford this on his pension and, on Sunday 21 March, Mr Hatzidis asked him to leave. He managed to pay the rent for his last week there but now has nowhere to live and is currently sleeping in his campervan. He has not been able to find anywhere else to live and is unable to afford a bond.
Mr Mattarollo said that when Ms Torres was living with him, she would do most of their washing but he would generally cook for both of them or, when she was working, she would often eat elsewhere. With other household tasks, he tries to minimise these and does these when he is able. Mr Hatzidis would do most of the cleaning of the flat.
Mr Mattarollo said he has recently been diagnosed with cardiac arrhythmia and referred to a letter from his general practitioner, Dr Clive Lovell, dated 22 February 2010, confirming this. Even though he has been prescribed medication for this condition, he has not purchased it for lack of money. He has also not been able to afford the medication for the herpes from which he suffers. Further, Dr Lovell has referred him to a psychologist for treatment of what Dr Lovell describes in the ‘Team Care Arrangement Summary’ as generalised anxiety disorder. Mr Mattarollo has not yet followed this up or any had any such treatment. He questions how a psychologist can help him.
Mr Mattarollo estimated the cost of the large number of medications he needs for his various medical problems - Ms Hanstein (for Centrelink) calculated the total cost from the figures supplied by Mr Mattarollo as being approximately $220 per month. This does not include the cost of the medication for herpes and his newly diagnosed heart condition (which he has not yet purchased) which he has not been able to afford. Mr Mattarollo thought this a conservative figure and that he usually spends about $300 per month on medication.
Mr Mattarollo estimated the cost of food at $100 to $120 per week, and he spends about $20 per week on petrol for his car. He bought the campervan when he was still working, but even then it was a cheap car and now it is virtually worthless. He services the car himself and tries to save a little money regularly through the year to pay for the third party insurance. The cost of a recharge for his phone is about $30 every six months – he largely uses this as a receiver for calls and in emergencies. He does not buy clothes, or if he does, he goes to the “Salvos”, and he does not drink, smoke, buy magazines or go out. Mr Mattarollo said accommodation that he can afford is very difficult to find; it is likely to exceed $200 per week and he would be required to pay a bond which he does not have. Mr Mattarollo said he has no-one to whom he can turn in Australia. He thinks Mr Hatzidis is fed up with him and needs someone who can pay a higher rent. Mr Mattarollo’s parents having separated, his family are divided between Italy and South America. His father, who was a doctor, has died.
Mr Mattarollo said he has no other source of income apart from his pension. According to Centrelink, the DSP Mr Mattarollo receives has recently been increased to $701.10 per fortnight after the minimum withholding of $20. He also has the benefit of a Healthcare card. If he applies for rental assistance, the maximum for which he is eligible is $110 per fortnight. Given his current situation of not having any accommodation, he may also be eligible for a crisis payment of up to $350.
Centrelink’s Case
Ms Hanstein contended that Mr Mattarollo was a ‘member of a couple’ during the period of the debt and until Ms Torres left Australia on 4 November 2008. This is apparent from the answers given by Mr Mattarollo in the ‘Assessment of Living Arrangements’ form he completed in September 2008, and in which he referred to their de facto relationship on a number of occasions. Mr Mattarollo’s support for her in obtaining a spouse visa, the sharing of the flat, of expenses and household tasks, as well as his comment about sharing “spirit and mind”, all point to this. Ms Hanstein therefore submitted that Mr Mattarollo was not entitled to be paid DSP at the rate he was paid and the overpayment is a debt due to the Commonwealth.
Ms Hanstein submitted that there are no grounds for either writing off or waiving the debt. With regard to waiver, the debt did not arise solely because of administrative error and therefore there is no power to waive the debt under s 1237A. With regard to whether there are special circumstances that would justify exercise of the power of waiver under s 1237AAD, although Mr Mattarollo is currently without accommodation, this is unlikely to be ongoing and he has shown a capacity to manage his affairs effectively. He is receiving approximately $700 per fortnight after the withholding of $20 towards recovery of the debt, and it is open to him to apply for rental assistance and also a crisis payment in his present situation. Ms Hanstein acknowledged that Mr Mattarollo suffers from multiple medical problems, but said these are recognised in the grant of the DSP and Healthcare card. She submitted that Mr Mattarollo’s circumstances should not be regarded as special circumstances warranting exercise of the power of waiver.
With regard to whether the debt should be written off, Ms Hanstein noted that write-off is not available where a person has the capacity to repay the debt by instalments. She contended that Mr Mattarollo has a capacity for the debt to be recovered by deductions from his DSP, as has been the case, and therefore, the power to write off the debt should not be exercised.
Consideration
The first issue to be determined is whether Mr Mattarollo received an overpayment of DSP. In my view, the evidence provided by Centrelink indicating that Mr Mattarollo and Ms Torres were in a de facto relationship is compelling despite Mr Mattarollo’s protestations to the contrary. He supported her in a spouse visa application, they lived together sharing part of a flat, shared the rent and household expenses, and shared some household tasks such as washing (in her case) and cooking (in his). Mr Mattarollo’s evidence indicates that Ms Torres was also supportive of him on occasion in helping him with such things as applying creams needed for the treatment of his skin condition.
Mr Mattarollo states that their relationship was failing even in 2005 and that his statements in the ‘Assessment of Living Arrangements’ form he completed in September 2008 were a reflection of his difficulty in accepting the reality of the situation and more an expression of hope. I accept that there may have been difficulties in their relationship – such is the reality of many relationships. Notwithstanding this, however, the evidence provided by Centrelink supports a finding that the relationship was that of ‘members of a couple’. At least, this is how it appears to have been thought of by Mr Mattarollo at that time, there being no evidence from Ms Torres. I therefore find that they were members of a couple during the period 28 September 2005 to 21 October 2008.
Because Mr Mattarollo was in a de facto relationship, from the time Ms Torres commenced working, he was under an obligation to notify Centrelink of the fact of her working and, pursuant to the Social Security legislation, her income was required to be taken into account in assessing the rate of DSP payable to Mr Mattarollo. Thus, when Ms Torres commenced employment with the Windgap Foundation on 5 October 2005, her income was required to be taken into account. The fact that she was not a permanent resident at that stage and not herself entitled to social security benefits, and that Mr Mattarollo was otherwise entitled to payment of DSP at the single rate because of this, does not affect the requirement that because Mr Mattarollo and Ms Torres were in de facto relationship, any income earned by her had to be taken into account in assessing his entitlement to DSP. Thus, I am satisfied that Mr Mattarollo received an overpayment of DSP which constitutes a debt due to the Commonwealth under s 1223(1) of the Act, referred to above. I acknowledge that Mr Mattarollo feels that the debt should not be his and that he has been used, but in my view the law has been properly applied.
With regard to whether the debt should be recovered and the power exercised to waive a debt under s 1237A, discussed above, I am not satisfied that the debt was attributable solely to administrative error by Centrelink. It is possible that, as Mr Mattarollo contends, no record was made of information he may have provided to Centrelink about Ms Torres working, although, in my view, this seems unlikely given the information recorded by Centrelink on its database in relation to its communications with Mr Mattarollo and the fact that there is no record of such information being provided over a period of nearly three years. Nevertheless, even if there were such an error by Centrelink, I am not satisfied that the debt would be solely attributable to such an error. Thus, the power to waive a debt under s 1237A is not available in this case.
With regard to whether the debt should be waived under s 1237AAD and, in particular, because of the special circumstances of the case, I accept that Mr Mattarollo’s circumstances at the time of the hearing are, by reason of a combination of factors, special in the sense of being out of the ordinary or unusual. Mr Mattarollo is currently homeless and sleeping in his car for the reasons he gave in his evidence. He suffers from a number of serious medical problems which are recognised in the grant of DSP. These medical problems require for their treatment a considerable number of medications which, despite his having a Healthcare card, cost him, on a conservative estimate, at least $220 per month. He is not currently purchasing all the medication he needs because of a lack of money.
The Centrelink evidence is that Mr Mattarollo is currently (with a recent increase in the CPI) receiving a DSP of $701.10 per fortnight. In the past, his applications for rent assistance have been rejected because his immediate landlord refused to provide the necessary documentation to Centrelink. Nevertheless, it is open to Mr Mattarollo to claim rent assistance in the future to a maximum of $110 per fortnight. He may, because of his present circumstances, be also eligible for a crisis payment of up to $350 to assist with his immediate difficulties.
Mr Mattarollo impressed me as a person who is generally well able to manage his affairs, including living on the very limited resources available to him. Nevertheless, because of his disabilities and his immediate difficulties, he is clearly in a very ‘low’ state and struggling to cope. The Tribunal was, as a result, concerned for his welfare, and the Centrelink officer present at the hearing offered to arrange an appointment for Mr Mattarollo with a Centrelink social worker that afternoon with a view to helping him solve some of his immediate problems.
While, in my view, Mr Mattarollo’s present circumstances are ‘special’, one would hope that at least some of these problems, such as finding Mr Mattarollo accommodation, can be resolved in the short term.
One of the requirements for exercise of the power of waiver under s 1237AAD is that it is more appropriate to waive than to write off the debt. As explained above, writing off a debt means, in this context, postponing recovery action for the debt either for a stated period or otherwise. I note that Mr Mattarollo has, in the past, carefully managed his limited DSP income and that there has been a withholding from his pension of $20 per fortnight towards recovery of the debt. However, in the present circumstances, without accommodation and without some medication that he cannot presently afford and is not therefore purchasing and using, his health is potentially at risk and he needs assistance to resolve his immediate problems. In my view, it is appropriate in these circumstances to exercise the power in s 1236 of the Act to write off the debt until Mr Mattarollo’s immediate problems are resolved.
In due course, there will need to be a full reassessment of Mr Mattarollo’s situation – including of his medical conditions and expenses – to determine whether it is appropriate to resume recovery of the debt. One of the difficulties experienced by the Tribunal in this matter was the lack of medical evidence available to it in assessing Mr Mattarollo’s present condition. While Mr Mattarollo provided some information from his general practitioner, Dr Lovell, it would be helpful if Centrelink were to arrange for a full medical and psychological assessment to be undertaken by a suitably qualified medical practitioner or practitioners. This would assist in making a more accurate assessment of whether or not recovery of the debt should be resumed.
Decision
The decision under review is set aside and a decision substituted that the debt raised against Mr Mattarollo is written off pending further assessment of his situation at a later date.
I certify that the 41 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RP Handley, Deputy President
Signed: .........[sgd]................................................................
Associate
Date of Hearing: 23 March 2010
Date of Decision: 23 March 2010
Date of Written Reasons: 1 April 2010
Applicant representative: Self-represented
Respondent representative: Ms S Hanstein, AGS
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