McCulloch; Secretary Department of Employment and Workplace Relations and

[2007] AATA 1452

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1452

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2006/218

GENERAL ADMINISTRATIVE  DIVISION		)
Re		SECRETARY DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS

Applicant

And MELINDA MCCULLOCH

Respondent

DECISION

Tribunal Dr J D Campbell, Member

Date21 June 2007

PlaceSydney

Decision

The decision under review is set aside and in substitution thereof I determine that :

a)  No special circumstances are found to exist; and

b)  The preclusion period is nominated to commence on 27 November 2003 and to cease on 8 July 2009.

...................[sgd]......................

Dr J D Campbell
  Member

CATCHWORDS

SOCIAL SECURITY – compensation affected payments – preclusion period – special circumstances – consideration of financial, medical and personal circumstances – causal relationship between basis for compensation and compensation affected payment – decision under review set aside

Social Security Act 1991 - sections 17, 1169, 1170, 1184K

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

Groth and Department of Social Security (1995) 40 ALD 541

Re Ivovic and Director-General of Social Services (1981) 3 ALN No 95

Re Colaiacolo and Secretary Department of Social Security (1985) AATA

Department of Social Security v Hulls (1991) 22 ALD 570

Secretary Department of Family and Community Services and Allan (2001) 116 FCR 1

REASONS FOR DECISION

21 June 2007 Dr J D Campbell, Member

1.      Ms McCulloch was injured in a work accident on 28 October 1997 in which she sustained injuries to her back and leg. She received weekly compensation payments in relation to these injuries until 26 November 2003. Terms of settlement filed in the District Court on 27 November 2003 as a consequence of these injuries resulted in Ms McCulloch receiving a compensation settlement of $372,000 inclusive of $60,000 costs.

2.      Ms McCulloch was advised by the responsible department on 12 December 2003 that a preclusion period would operate from 27 November 2003 until 8 July 2009, during which Ms McCulloch would not be able to access Centrelink payments. Payment of the compensation was made to Ms McCulloch on 22 December 2003 ($280,570) and 27 February 2004 ($26,440.95).

3.      On 5 November 2004 Ms McCulloch lodged a claim for parenting payment. This claim was rejected by Centrelink on 10 November 2004 as a preclusion period existed. On 13 June 2005 Ms McCulloch sought a review of the preclusion period because of a change in circumstances, both financial and personal. A review was undertaken by the responsible officer with Ms McCulloch advised on 1 August 2005 that her then current circumstances were seen as not being sufficient to warrant a reduction/waiver of her preclusion period, pursuant to section 1184K of the Act. Upon a further request by Ms McCulloch a review undertaken by an authorised review officer resulted in Ms McCulloch being advised on 26 September 2005 that her preclusion period remained unchanged. 

4.      A further review was conducted by the Social Security Appeals Tribunal and in a decision dated 31 January 2006 the Tribunal concluded that special circumstances existed in the matter, so much so that an amount of the compensation payment to Ms McCulloch should be disregarded in order that her preclusion period end on 24 July 2006. In so finding, the Social Security Appeals Tribunal considered that Ms McCulloch’s then circumstances had arisen as a consequence of her husband squandering $80,000, a divorce property settlement of $20,000, a strained relationship with her husband preventing her from raising her financial concerns with him about such expenditure, as well as such issues resulting in arguments which caused stress to her eldest daughter. Further the Tribunal considered it unfair that Ms McCulloch should lose the benefit of her home, modified to assist her in coping with her medical conditions, if she were forced to sell. The Tribunal also noted the loss of financial contribution by Mr McCulloch to the financial circumstances of the family, apart from a minimal monthly child support contribution. It is this decision which is the subject of review on the application of Secretary, Department of Employment and Workplace Relations.

issues

5.      The relevant issues in this matter are:

a)What is the preclusion period?

b)Are there any special circumstances?

c)Are there any special circumstances existing that allow the whole or part of the compensation payment to be treated as not having been made or not liable to be made?

decision

6.      For reasons stated later in this decision I find that:

a)The preclusion period from 27 November 2003 until 8 July 2009 has been correctly calculated and defined;

b)No special circumstances exist; and

c)In the absence of special circumstances, there exists no discretion to alter the treatment of the compensation payments, with the preclusion period existing between 27 November 2003 and 8 July 2009.

7.      The decision under review is set aside and in substitution thereof I conclude that:

a)No special circumstance exist in this matter; and

b)The preclusion period commences on 27 November 2003 and ceases on 8 July 2009.

background

8.      Ms McCulloch is in her early thirties. She completed year 12 in 1993, but her performance in her exams was affected by injury during the exams. In the following years Ms McCulloch completed a Child Care Certificate and a Receptionists Certificate at TAFE. Ms McCulloch undertook the Open Foundation program to qualify for university. In 1997 Ms McCulloch commenced a Science and Mathematics degree at university, but after a short attendance she deferred.

9.      On 28 October 1997 Ms McCulloch injured her leg and back in a work related injury while working as a catering assistant for Spotless Services at the Tomago Smelter. Following surgery and rehabilitation Ms McCulloch returned to part-time (limited daily hours) with Spotless Services, while unsuccessfully attempting to resume university studies in a psychology degree program in 1999.

10.     In 1999 Ms McCulloch met Mr McCulloch and they were married on 26 May 2001. They now have two daughters aged 5 and 3. Ms McCulloch and Mr McCulloch purchased a house in April 2001, where Ms McCulloch still resides, having arranged bank loan finances in February 2001 in the order of $100,000, together with a loan to Ms McCulloch by her father of $50,000 (no documentation) in early 2001. Ms McCulloch and Mr McCulloch separated in October 2004.

11.     Ms McCulloch left the work at the Smelter in 2000, and received workers compensation periodic payments until settlement of her compensation claim in November 2003.

12.     Following the payment of the compensation monies in the order of $307,000 Ms McCulloch paid approximately $88,000 to discharge her mortgage and a further $7,000 to her father for loans relating to the purchase of a caravan and legal and medical expenses in relation to preparation for the compensation proceedings. A further $4,000 was later paid to her father in relation to a loan to purchase a car for Mr McCulloch. Following the separation and property settlement in which she paid $15,000 to Mr McCulloch Ms McCulloch repaid her father the loan of $50,000 for the purchase of the house and $20,000 for monies owed in relation to the purchase of a LandCruiser.

13.     By 24 July 2005 Ms McCulloch was stating that her operating bank account had a balance of $441.21, that her income was insufficient for her to provide for her and her two children’s living expenses and that she was relying on borrowing from her father to survive. In further material adduced at the hearing the amount of borrowing from her mother and father had increased to $49,650 by 13 April 2007.

legislation

14.     The relevant legislation in this matter is the Social Security Act 1991, specifically sections 17, 1169, 1170 and 1184K. In particular section 1184K(1) provides:

For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:

(a) not having been made; or

(b) not liable to be made;

if the Secretary thinks it is appropriate to do so in the special circumstances of the case.

consideration and findings

15.     In addressing the issues raised in this matter, I am mindful that there has been significant evidence provided as to the financial circumstances of Ms McCulloch prior to the receipt of her lump sum compensation payment, the manner and circumstances of the expenditure of the lump sum compensation, her current assets and liabilities, current income and expenditure and her sources of funds and spending patterns over time. Further material has been adduced and explored in relation to her relationship with her husband including their separation and property settlement and the wellbeing of the two children in the circumstances of the separation and the current circumstances. Finally, evidence has been adduced relating to the social, physical and mental wellbeing of Ms McCulloch as a consequence of her work injury, her separation and property settlement and her current circumstances. Such matters will be considered in detail in assessing whether or not such circumstances, either singly or together, constitute special circumstances.

compensation preclusion period

16.     Both parties in this matter are agreed that the preclusion period arising from the award of a lump sum compensation payment to Ms McCulloch of $372,000 (gross) on 27 November 2003 had been initially correctly assessed and defined pursuant to sections 17, 1169 and 1170 of the Act. I concur and so find that the preclusion period commenced on 27 November 2003 and ceases on 8 July 2009.

special circumstances

17.     The question of what constitutes a “special circumstance” has been much canvassed over time. In Re Beadle and Director-General of Social Security (1984) 6 ALD 1, Toohey J at page 3 stated:

An expression such as “special circumstances” is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend upon the context in which they occur. For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. That is not to say that the circumstances must be unique, but they must have a particular quality of unusualness that permits them to be described as special.

18. In Groth v Secretary Department of Social Security (1995) 40 ALD 541 Kiefel J stated at page 545:

…it would require something to distinguish [an applicant’s] case from others, to take it out of the usual or ordinary case. …It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.

19.     In Re Ivovic and Director-General of Social Services (1981) 3 ALN N95, the Tribunal stated:

The reference to special circumstances ‘by reason of which’ a person liable ‘should be released’ requires, in our view, that there must exist in the circumstances of the case, a factor or factors which justify the making of an exception in whole or in part to the principle of liability which the Act otherwise establishes.

20.     In Re Colaiacolo and Secretary Department of Social Security (1985) AATA 2109 the Tribunal stated that the factor of financial hardship alone is not sufficient to amount to a special circumstances, unless it is “exceptional” and not merely “straitened”.

21.     Further in both the Department of Social Security v Hulls (1991) 22 ALD 570 and Secretary Department of Family and Community Services v Allan (2001) 116 FCR 1 the purpose of the legislative arrangements are enumerated, with Heerey J noting in the latter matter:

The basic policy, understandably enough, is that there should not be ‘double dipping’. People should not receive social security payments for loss of earnings where they have received compensation for that same loss of earnings from another source.

financial circumstances

22.     Prior to the receipt of the lump sum compensation payments on 22 December 2003 and February 2004, Ms McCulloch had purchased a house jointly with her intended husband and married Mr McCulloch in May 2001. The house was purchased with a split loan of approximately $100,000 from the bank (two elements of $50,000) and a $50,000 loan from Ms McCulloch’s father (Mr Jennings), for which there is evidence of a deposit of $50,000 to a Building Society account held in joint names (Mr McCulloch and Ms McCulloch) in early February 2001. No other documentation in relation to this loan, including source of funds documentation from Mr Jennings’ accounts was before the Tribunal. Verbal evidence was led from both Ms McCulloch and Mr Jennings that it was a no interest family loan that had no definite date of repayment, but an expectation by Mr Jennings that repayment would occur sometime in the future, when able, and certainly if the house was sold. The house was purchased for $133,000 with settlement in April 2001, with money not used in the purchase directed towards costs of furnishings for the house.

23.     Further borrowings included Ms McCulloch receiving a loan of $20,000 from her father (undocumented) to assist in the purchase of a Toyota Land Cruiser vehicle around the time of the birth of the first child (May 2002) or even earlier as suggested by Ms McCulloch. Further debts accrued by Ms McCulloch to her father related to the purchase of the grandmother’s caravan for $5,000, and money expended by Mr Jennings in supporting the preparation of Ms McCulloch’s compensation case.

24.     While I note the virtual absence of any primary documentation in relation to Mr Jennings’ loans to Ms McCulloch, no evidence was adduced which would permit me to conclude that the purpose and content of these intra family transactions were other than as described by Mr Jennings, Ms McCulloch and Mr McCulloch. I also noted that in this period, prior to the lump sum compensation payout, there is material indicating that the McCulloch household financial circumstances required assistance in kind from Ms McCulloch’s parents (food, nappies, etc.).

25.     The lump sum payment was received in hand on 22 December 2003 and 27 February 2004. A payment of $88,000 (approx) was made to the bank on 5 January 2004 to retire the household mortgage in it’s entirely. A further sum of $7,000 was withdrawn from the joint bank account (Commonwealth) on 30 January 2004 with evidence from both Mr and Ms McCulloch that this was a repayment to Mr Jennings for the caravan and legal expenses debt. On 10 February 2004, $4,000 was withdrawn from the same account, with the purpose of buying a car for Mr McCulloch.

26.     By 10 November 2004, the balance in the same bank account into which the compensation payment of $307,000 (approx) had been made, stood at $120,000 suggesting an expenditure in eleven months of some $88,000, apart from the money expended to repay the loans as nominated above. Coupled with this expenditure, is expenditure associated with her husband’s earnings from the Smelter until his retrenchment in mid 2004, her husband’s earnings from carer payments and casual work thereafter and family tax benefits received by Ms McCulloch which were deposited in the joint Building Society account.   

27.     In relation to this period of expenditure, Ms McCulloch stated “I looked at that money and thought we are bloody loaded for how, we had struggled prior to that, we were like millionaires” (Transcript 26 March 2007 p62). In further commentary Ms McCulloch stated that their spending was stupid and wasteful. In spending as they did during this period, Ms McCulloch stated that they purchased what they needed for the home (solar hot water service, a ramp and internal fittings to assist with Ms McCulloch’s impairments), a trailer, a caravan annex, a computer, cot and pram and many tools for her husband. Ms McCulloch also confirmed that she made excessive and unnecessary purchases in relation to jewellery, children’s clothes and toys together with a growing attraction to purchasing using e-bay.

28.     In relation to this period of expenditure (December 2003 – November 2004) I conclude that the expenditure by both Mr and Ms McCulloch was both excessive and extravagant, with many purchases being of a somewhat whimsical nature and not founded on need nor necessity.

29.     From mid 2004 it is evident that tensions in the matrimonial circumstances were of a concern to both participants. On 10 November 2004, Ms McCulloch withdrew $120,000 from the joint bank account and deposited the same sum into a separate Commonwealth bank account in her own name. Ms McCulloch viewed this as a prudent action in order that she receive family tax benefit payments and in anticipation of the property settlement arising from the impending situation.

30.     On 17 November 2004, Ms McCulloch withdrew $85,000 from her personal Commonwealth account. She stated that such money was used to repay her father’s loans ($50,000 for the house, $20,000 for the LandCruiser) and $15,000 to Mr McCulloch in relation to the property settlement, which had been agreed in October 2004, but not finalised by the Court until 1 December 2004 (Exhibit R6). It is noted that the property settlement resulted in Ms McCulloch receiving the house and other property and cash assets valued at $330,000, after the payment to Mr McCulloch of $15,000.

31.     By 30 June 2005 Ms McCulloch is noted as having $126 in her personal cash management account, indicating an expenditure of approximately $34,500 from this account since 17 November 2004, plus fortnightly family tax benefits of $391 (approx), child support payments from her ex-husband of $74 a month and two deposits totalling $5,800 (approx) which Ms McCulloch believed to be tax return payments. An analysis of the above would indicate that Ms McCulloch had expended some $44,000 (approx) in a seven month period. Ms McCulloch stated that while she continued to spend excessively in a manner that had already been detailed, she may have made payments in relation to legal expenses and furnishings for her ex-husband (approx value $5,000).  

32.     Between 1 July 2005 and 30 June 2006, Ms McCulloch expended a further $37,500 (approx) with sources of funds being her parents ($26,500 approx) (Exhibit R10), family tax benefit payments ($10,000 approx) and child support payments ($1,000 approx).

33.     In the period between 1 July 2006 and 13 April 2007, Ms McCulloch expended $37,000 (approx) with source of funds being her parents ($28,000 (approx), family tax benefits ($8,000 approx) and child support payments ($1200 approx).

34.     In both periods nominated in paragraphs 32 and 33 Ms McCulloch has continued to expend money in the manner to which she has been accustomed. Ms McCulloch in her evidence considers that much of her expenditure is necessary for the welfare of her children and this includes annual caravanning holidays to be with her parents, ballet and swimming lessons, clothes and other incidentals for the children. Ms McCulloch also indicated that there had been some unforeseen expenses associated with car breakdowns and roof repairs and that her car was in need of significant repairs. In speaking of her personal entertainment expenses Ms McCulloch alluded to the episodic difficulties with alcohol consumption since her accident in 1997, at the time of the hearing her consumption of alcohol (vodka) was one to two bottles a week, although on a periodic night out with a girlfriend (once every six weeks) she would consume up to $300 worth of alcohol between 8pm and 5am the next day. It is to be noted that by 13 April Ms McCulloch was indebted to her parents in the order of some $50,000 (approx) (Exhibit R18).

35.     In considering Ms McCulloch’s current financial circumstances, which indeed are the relevant circumstances when considering that they alone and/or in combination with other circumstances are deemed to be special, I note the following:

a)The income and expenditure statement (Exhibit R17 folio 9) for Ms McCulloch as at 26 November 2006 indicates annual income at $12,145 and expenditure at $28,060.

b)This statement was drawn up by Mr Jennings after discussion with his daughter and an assessment by him as to reasonable expenditure in a particular category.

c)While evidence was given that the child maintenance payment had increased to $150 a month, such an increase is of marginal significance in the analysis.

d)The statement nominates a proposed annual deficit of $15,915, with particular relative expense items being car and caravan operating costs ($5,200), education ($2,270), and living expenses ($12,410).

36.     In commenting upon the proposed budget, I am mindful that it is a budget for a single parent with two children under the age of five. While it is a budget prepared after consultation with Ms McCulloch, there are clearly items of proposed expenditure which are inconsistent with evidence led by Ms McCulloch during the hearing. In this regard I note her statement about alcohol consumption, her episodic nights out and the intention to maintain activities such as holidays and ballet classes. While issue could be taken with choice of vehicle and the use of a caravan for holidays as regards the costs created, my concern is that the expenditure statement underestimates the likely expenditure.

37.     In stating that I have a concern that the statement may underestimate likely actual expenditure, I draw inference from previous expenditure patterns which have been demonstrated by Ms McCulloch, both before (with assistance) and after (without assistance) her separation from Mr McCulloch. Such an inference is reinforced by her evidence justifying the expenditure and her apparent disinclination to undertake any significant reappraisal of spending that would in any way create a disturbance to her lifestyle or ownership of assets already purchased. I note some evidence was led that there had been a downturn in her spending pattern since 14 November 2006 (first hearing day). I note expenditure since that time to 13 April 2007, a period of approximately five months amounts to $14,000 (approx) with sources of funds being parents ($9,000 approx), family tax benefit ($4,250) and child support payment ($750). I further note the invoice from Skinner’s Mechanical (Exhibit R4) for assessment of costs to fix oil and water leaks from the LandCruiser at $3,890, with clearly this being a delayed expenditure if the vehicle is not to be sold. More importantly however is the evidence from both parents that they will continue to source funds for Ms McCulloch when asked and without question. In consideration of all these circumstances I conclude that there is unlikely to be any significant change in Ms McCulloch’s level and/or range of expenditure, with the expenditure nominated in the budget statement very much a minimum.

38.     In considering Ms McCulloch asset and liability statement dated 12 March 2007 (Exhibit R18), I note the house valuation at $250,000, a valuation supported by material from the Australian Valuation Office on 22 May 2006 (Exhibit R13). I note the value of other nominated assets, which include the LandCruiser, caravan, trailer and house contents. I note the total asset situation of $277,000 (approx) and the liability of $50,000 (approx) to the parents, leaving a surplus of $227,000, in the event that the debt to the parents were to be repaid, there being no evidence to this effect.

39.     I have been particular in detailing the financial circumstances of Ms McCulloch since 2001 prior to receipt of her lump sum compensation payment and the events and circumstances of the receipt of such money. While recognising that the lump sum compensation was awarded to provide for loss of future earnings, I observe that Ms McCulloch has elected over time to place in excess of half the amount into capital assets by way of retiring the debt against a house and a motor vehicle. The remainder has in a small part been spent on a property settlement, with a significant proportion of the remainder on rampant excessive spending, in which she was in part assisted by Mr McCulloch.

40.     Ms McCulloch is a sole parent with two children under five and I recognise that there is a financial cost of maintaining such a family. Nevertheless while I recognise that there is an operating short fall of a minimum of $16,000 (approx) per annum to provide for the nominated rate of expenditure, I also recognise that there is acquired (as a consequence of the lump sum compensation payment) capital surplus of $227,000 (approx).  While I acknowledge that the capital surplus has arisen mainly by investment in an appreciating asset, I also recognise that the current operating shortfall has arisen by an unwise and excessive spending pattern over a number of years. While I have sought reasons, including a psychiatric appraisal, for such spending, no assistance has been forthcoming to provide an understandable explanation for such an expenditure pattern by Ms McCulloch.

41.     In considering the financial circumstances as outlined, I acknowledge that Ms McCulloch is experiencing a shortfall of cash to fund her annual operating expenses at the level she wishes to expend. Such a shortfall has origins in both Ms McCulloch’s excessive spending patterns and investment in capital assets. I observe that a shortage of cash alone, in a set of circumstances where the level of expenditure was reasonable, may be viewed as an unusual circumstance in the absence of an ability to realise assets. However in this matter, while much argument and consideration has been given to Ms McCulloch’s current cash situation, less exploration and appreciation has been given by Ms McCulloch to the concept of realising assets to meet her cash shortfall. While I recognise Ms McCulloch’s desire not to realise assets, the fundamental reality is that these capital assets were sourced from her compensation payment in the order of $170,000. Further while giving consideration to the nature of the capital asset (namely her home) with its obvious attraction as a place of residence for Ms McCulloch and her two children, the simple fact remains that all her net capital assets are derived from the compensation payment. In such a situation, while recognising that sale involves relocation and disruption, I must conclude that the overall financial situation is not one lacking availability of financial resolution, albeit involving sale of assets including the home. That such a circumstance is unusual, uncommon or exceptional is not really in contention, as such an event is a common, albeit unwelcome and disruptive, event in our modern society. That such an event be considered unfair or unjust fails to acknowledge both the source of the difficulty and the means of resolving the difficulty, and would fail to recognise that any finding of special circumstances must be within the proper construct of the Act which makes provision for such a finding.

42.     In summary, for the reasons outlined, I find that Ms McCulloch’s financial circumstances alone are in themselves not special in that they are neither uncommon, unfair, unjust, unusual or exceptional. I further comment that both the causation and resolution of her financial cash flow difficulties are the result of activities taken and not taken or not wished to be taken by Ms McCulloch, albeit assisted in part by her former partner as regards expenditure.  

medical circumstances

43.     Ms McCulloch experienced injury to her back and leg in a work related accident in 1997. Evidence was led of operative interventions in 1998 and 1999 to her left knee with continuing symptoms of pain in neck, back and knee. A return to work program was limited to three hours a day until she left work in 2000. A report from Dr Beiers, dated 21 September 2006 (Exhibit R15) detailed difficulties with both knees with pain, kneeling and squatting, a niggling pain in her back, posterior neck pain and mood which is “teary at times”. Dr Beiers found minor abnormalities of the knees, lumbar spine, with some tenderness noted on paraspinal musculature in the cervical and lumbar regions. Dr Beiers concluded that Ms McCulloch has “bilateral patellofemoral pain with limitations in her standing tolerance and ability to ambulate up and down stairs and squat”. Further Ms McCulloch has a “non specific low back pain and limited tolerances for sitting, standing and walking”. Ms McCulloch also has a soft tissue injury to her cervical spine. Dr Beiers was particular in nominating that the report had been generated with limited information at hand, namely a short report from Dr Kesby of 28 August 2006, which also indicated that Ms McCulloch had received counselling for the psychological injury she had suffered (Exhibit R3).

44.       Further in her evidence Ms McCulloch spoke of continuing difficulties since the accident in 1997, her issues with alcohol after the accident, and said that times were difficult when living with Mr McCulloch at her parents’ house during the period prior to the compensation payment. Ms McCulloch stated that the period leading up to the separation was difficult at times with Mr McCulloch having difficulty with the two small children and that arguments were not infrequent. Nevertheless the decision to separate was amicably arrived at and the process leading to the separation was essentially organised without any difficulty. Ms McCulloch stated that from time to time, since the separation, she has periods where she withdraws within herself. Ms McCulloch described such episodes as staying in the house, not answering the phone and not wishing to see anyone.  She has consulted her general practitioner who has prescribed one tablet of Lovan in the morning for her depressive symptoms and a different tablet at night to help with her sleeping.

45.     Mr Dewhurst, a Clinical Psychologist in a report dated 26 October 2006 (Exhibit R9) considered Ms McCulloch displayed and reported signs and symptoms of depression and anxiety relating to the impact of her workplace accident, the break up of her marriage, her financial insecurity and her current tribunal hearing. This report was admitted into evidence with the understanding that Mr Dewhurst would be available for cross-examination. Unfortunately because of illness he was unavailable, with the report having to be considered and weighed in the context of what was reported in the report and what had been adduced in evidence by Ms McCulloch and other witnesses. It is noted that Mr Dewhurst reported Ms McCulloch attributing much of her financial problems to excessive spending by Mr McCulloch, as well as his unwillingness to cooperate in financial planning. Mr Dewhurst also noted that Ms McCulloch also attributed her psychological symptoms to issues surrounding the separation. On both issues, evidence to the contrary was before the Tribunal, with any probative weight to be given to the report remaining untested in my opinion.

46.     I have considered what limited medical and psychological evidence I have before me. I consider that Ms McCulloch does have some continuing symptomatology arising from the injury to her back and leg in 1997. It is said to cause some restriction of mobility up and down stairs and some restriction as to sitting, standing and walking. I note however, her ability to have a night out, which appears to involve socialising and drinking from 8pm to 5am the next morning.

47.     Further I note a history of episodic symptomatology which has required counselling, commencing in 1995, post-injury and currently, in which she defines symptoms of withdrawal episodically. Such symptoms as described together with difficulty with sleeping are of a depressive and anxious origin as observed by Mr Dewhurst and her local general practitioner. Some antidepressant medications have been prescribed, but no psychiatric referral has been made.

48.     I note the two issues described above, and while further I note the issue of alcohol usage, I find that the medical and psychological evidence as to the true physical and psychological circumstances pertaining to an assessment of Ms McCulloch’s health status lacking in particularity and substance. In such circumstances, and without adequate definition, I can only record what has been afforded. It is my conclusion that on the material before me Ms McCulloch’s circumstances are not unusual, uncommon or exceptional for an individual that has suffered an injury for which she has received compensation coupled with a change of circumstances where she is now a sole parent with two small children, albeit with supportive grand parents and a separated partner who continues to have interaction with his children. In summary I consider that Ms McCulloch’s medical and psychological circumstances are not special.

the two children

49.     Mr Vincent (counsel for Ms McCulloch), in his argument, considered that the two children constituted a special circumstance. I accept the welfare of the two children is an important consideration, but the only evidence led was that arrangements as they now stood, in which the grandparents played a significant role and enjoyed caring for the two children, mainly at the grandparents’ home, should remain. No evidence was led as to what effect the sale of the current home would have on the children in terms of relationships with others. Nor was their any evidence that either child would suffer any psychological disturbance as a result of moving.

50.     While superficially attractive, the contention, given the lack of evidence supporting child place specific attributes and psychological trauma to the children as a consequence of relocation, fail to mature. In such circumstances, and particularly where other housing options have not been examined in depth, any consideration that such circumstances are unusual, uncommon or exceptional remains speculative and as such they do not constitute special circumstances.

consideration of all circumstances

51.      Mr Vincent in his argument also raised the issue that the claim for parenting payment (pensionability) was unrelated to the claim for compensation (compensability), in that the pensionability issue (claim for parenting payment) was un-associated with and occurred after and not as a result of the compensability issue (work related issue and lump sum payment). Such an argument has origins in situations where a compensable event has occurred with lump sum compensation paid and during the nominated preclusion period a further non compensable injury has occurred, which in turn has led to an inability to work and a claim for disability support mainly arising from the intervening injury. Such circumstances in cases have been considered to constitute special circumstances with a preclusion period altered and a disability support pension payable. In the matter to hand the intervening event is a pregnancy and in the absence of any particular circumstances arising from the pregnancy and/or resultant child, it is difficult to envisage such an event as unusual, uncommon or exceptional when considered in the context of a marriage, or indeed in circumstances of a marriage like relationship. In the circumstances as described in this matter the argument as raised must fail for the want of special circumstances not being found to exist as a consequence of the intervening pensionability issue (the pregnancy).

52.     In considering all the circumstances nominated together, I am of the view that an outcome favourable to Ms McCulloch is not further assisted. In so saying I note the evidence adduced during the hearing tended to negative the special circumstance issues on which the Social Security Appeals Tribunal relied to base their decision. In particular, issues pertaining to Mr McCulloch spending recklessly reverted to both Mr and Ms McCulloch spending recklessly, issues concerning the stress of the separation became one of an orderly and agreed process without any major difficulties and with minimum effect on the children.

53.     In considering all the circumstances together, I recognise that there is considerable interdependence between the various circumstances in consideration. Clearly, on the evidence before me, Ms McCulloch’s financial situation is the primary focus of the difficulties faced with personal and lifestyle issues, including her home and care for the children’s welfare, important consequences of her financial situation. I do remain concerned, however, that proper specialist exploration and understanding of Ms McCulloch’s reasons and/or lack there of for the pattern of spending adopted and maintained over time may have provided some insight. Nevertheless such was not adduced in evidence and I am left with a set of circumstances, the net effect of which is that such circumstances are common, not unusual or not exceptional. Nor in the circumstances as adduced unfair or unjust, when assessed within the context of their origins and possible outcomes.

54.     In summary I conclude that upon consideration of the particular circumstances adduced in this matter and/or a combination of those particular circumstances, I am unable to conclude that such circumstances constitute special circumstances.

55.     As a consequence I set aside the decision under review and in substitution thereof determine that :

a)No special circumstances are found to exist; and

b)The preclusion period is nominated to commence on 27 November 2003 and to cease on 8 July 2009.

I certify that the 55 preceding paragraphs are a true copy of the reasons for the decision herein of Dr J D Campbell, Member

Signed:         ...........[Emily Gadsby]................
   Associate

Date/s of Hearing  14 November 2006, 26 and 27 March 2007
Date of Decision  21 June 2007
Counsel for the Applicant         Mr M Vincent
Solicitor for the Applicant          Mr J McClintock of the Legal Aid Commission
Counsel for the Respondent     Ms K Eastman
Solicitor for the Respondent     Ms S Hanstein of the Australian Government           Solicitor