Mensforth and Secretary, Department of Family and Community Servi Ces

[2003] AATA 901

Administrative

Appeals

Tribunal

 

DECISION AND ORAL REASONS FOR DECISION [2003] AATA 901

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No S2003/196

GENERAL ADMINISTRATIVE  DIVISION		)
Re		CRAIG MENSFORTH

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Senior Member WJF Purcell

Date28 August 2003

PlaceAdelaide

Decision For the reasons given orally at the Hearing of this matter, the Tribunal affirms the decision under review.

(Signed)

WJF PURCELL
  (Senior Member)

CATCHWORDS

SOCIAL SECURITY – pensions, benefits and allowances – Disability Support Pension – preclusion period – whether preclusion period has been calculated and imposed correctly – whether there are grounds to treat all or part of the compensation as not having been made – whether there are special circumstances

Social Security Act 1991 sections 17, 1169, 1171, 1184K

ORAL REASONS FOR DECISION

28 August 2003   Senior Member WJF Purcell         

1.      This is an application for review of a decision of the Social Security Appeals Tribunal (the SSAT) of 30 April 2003, which affirmed a decision of an Authorised Review Officer of 18 February 2003, which in turn had affirmed the decision of a  delegate of 11 December 2002, to impose a compensation preclusion period from 28 November 2002 to 24 December 2003.

2. The evidence before the Tribunal comprised the documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (the T Documents). The applicant appeared on his own behalf and gave oral evidence by way of telephone link-up. Mr Underwood represented the respondent (the Department).

3.      The applicant, who is 46 years of age, injured his right arm on 10 July 2000 whilst pruning extra thick grapevines for BRL Hardy Wine Company in the Longhorne Creek region.  He received periodic compensation payments up to and including 27 November 2002.  He received two lump sums, totalling $68,121.27.  The first payment of $33,360 was made on 8 March 2001, and the balance of $34,761 was paid on 27 November 2002. 

4.      On 11 December 2002 the Department wrote to the applicant.  The letter reads in part:

“Dear Mr Mensforth

Date of Injury: 14 July 2000

Our Compensation Reference Number:  C11026109V

We are writing to you about your claim for compensation.

When a person receives a lump sum payment of compensation, part of the payment is considered to be for lost earnings or lost capacity to earn (compensation part).  The compensation part is then used to calculate a period of time when a person will not be eligible to receive Centrelink payments, with the exception of payments made for children, Carer Allowance and Mobility Allowance.  This period of time is called the preclusion period.

We have been advised that you are entitled to a lump sum compensation payment of $68,121.70.  In case you need to apply for Centrelink payments in the future, we have calculated that the preclusion period start date is 28 November 2002 and the end date is 24 December 2003.  You may however choose to test your eligibility for other benefits such as a Health Care card.

…”  [T6/20] 

5.      The applicant applied for review of the decision, and the decision was affirmed by an Authorised Review Officer on 18 February 2003.  The applicant applied to the SSAT, which heard the matter on 30 April 2003, and affirmed the decision on that day.  The applicant has applied to this Tribunal for review.

6. Compensation is defined in section 17 of the Social Security Act 1991 (the Act), which reads, in part, as follows:

“17(2)  Subject to subsection (2B), for the purposes of this Act, compensation means:

(a)       a payment of damages; or

(b)a payment under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or

(c)a payment (with or without admission of liability) in settlement of a claim for damages or a claim under such an insurance scheme; or

(d)       any other compensation or damages payment;

(whether the payment is in the form of a lump sum or in the form of a series of periodic payments and whether it is made within or outside Australia) that is made wholly or partly in respect of lost earnings or lost capacity to earn resulting from personal injury.

Note:   Under section 1163B, a person may be treated as having received compensation that the person would have received but for the effect of a State or Territory law.

…

17(2B)A payment under a law of the Commonwealth, a State or a Territory that provides for the payment of compensation for a criminal injury does not constitute compensation for the purposes of this Act.

17(2C)The reference in subsection (2B) to a criminal injury is a reference to a personal injury suffered, or a disease or condition contracted, as a result of the commission of an offence.

Compensation part of a lump sum

17(3)Subject to subsection (4), for the purposes of this Act, the  compensation part of a lump sum compensation payment is:

(a)       50% of the payment if the following circumstances apply:

(i)the payment is made (either with or without admission of liability) in settlement of a claim that is, in whole or in part, related to a disease, injury or condition; and

(ii)the claim was settled, either by consent judgment being entered in respect of the settlement or otherwise; or

(ab)     50% of the payment if the following circumstances apply:

(i)the payment represents that part of a person’s entitlement to periodic compensation payments that the person has chosen to receive in the form of a lump sum; and

(ii)the entitlement to periodic compensation payments arose from the settlement (either with or without admission of liability) of a claim that is, in whole or in part, related to a disease, injury or condition; and

(iii)the claim was settled, either by consent judgment being entered in respect of the settlement or otherwise; or

(b)if those circumstances do not apply - so much of the payment as is, in the Secretary’s opinion, in respect of lost earnings or lost capacity to earn, or both.”

7.      Section 1169 of the Act, as far as is relevant for the purposes of this review, provides:

“(1)     If:

(a)       a person receives or claims a compensation affected payment; and

(b)       the person receives a lump sum compensation payment;

the compensation affected payment is not payable to the person in relation to any day or days in the lump sum preclusion period.

(2)       In this section:

lump sum compensation payment does not include a lump sum payment:

(a)       to which section 1164 applies; or

(b)that relates only to arrears of periodic compensation payments.”

8.      Section 1171 of the Act again, as far as is relevant for the purposes of this review, provides:

“(1)     If:

(a)a person receives 2 or more lump sum payments in relation to the same event that gave rise to an entitlement of the person to compensation (the multiple payments); and

(b)at least one of the multiple payments is made wholly or partly in respect of lost earnings or lost capacity to earn;

the following paragraphs have effect for the purposes of this Act and the Administration Act:

(c)the person is taken to have received one lump sum compensation payment (the single payment) of an amount equal to the sum of the multiple payments;

(d)       the single payment is taken to have been received by the person:

(i)on the day on which he or she received the last of the multiple payments; or

(ii)if the multiple payments were all received on the same day, on that day.

(2)A payment is not a lump sum payment for the purposes of paragraph (1)(a) if it relates exclusively to arrears of periodic compensation.”

9.      Section 1184K of the Act provides:

“(1)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.

(2)       If:

(a)a person or a person's partner receives or claims a compensation affected payment; and

(b)       the person receives compensation; and

(c)the set of circumstances that gave rise to the claim for compensation is not related to the set of circumstances that gave rise to the person's or the person's partner's receipt of, or claim for, the compensation affected payment;

the fact that those 2 sets of circumstances are unrelated does not alone constitute special circumstances for the purposes of subsection (1).”

10.     The applicant submits that the legislation is unfair and unjust, and that his circumstances are so special that the discretion available to the decision-maker, and hence to this Tribunal, in section 1184K of the Act, should be exercised in his favour.  He is so badly injured, both physically and mentally, that he is a shell of his former self, and needs the income from a Disability Support Pension now to relocate himself to Adelaide, to have surgery on his left arm to be performed by Dr Cullum, and to obtain Housing Trust accommodation in Adelaide.

11.     It is clear, on his evidence, that the applicant has become embittered by his experiences of the compensation system and the injustices he perceives.  The written statement recorded in the SSAT’s Reasons for Decision outline his complaints as follows:

“In the winter of 2000 AD I pruned extra thick grapevines, at B.R.L. Hardies in the Longhorne’s Creek region.  The first two hours made my right hand sore and from then on it only got worse.  Each day after work the top of my right hand was badly swollen, my elbow ached, as well as my neck.

Having a crippling mortgage, I battled on manfully to make end meet; bad move!

On the 17/7/2000 my right arm was paralysed.  After nerve conduction, my much admired and totally dependable doctor, Peter Bauer operated at Victor Harbor Medical centre on my right carpal tunnel. Six months later after seeing a hand therapist twice a week and two specialists, my hand looked like a claw.

Dr. Callum [sic] did further nerve conduction, an ultrasound found abnormality in my right elbow.  After a scary first ever M.R.I. scan the evidence was said to show a “Double Crush” at the C5/6, C6/7 there was a “radiculopathy”.  There are also interior disc bulges causing “Stenosis” on my spinal chord [sic].  Muscles in my neck spasm causing a tightening ache similar to a hamstring cramp.  My right side of my face is also affected and aches.

Does pruning until your right arm is paralysed not constitute a 100% effort?  Why then was I only paid 80% of my wages?  In the second year it was reduced to 80% of the original 80%.  I felt totally despondent and contemplated suicide, my wages were half of what I had earned prior to the injury.

After seeing “Cindy Molloy,” a Neurosurgeon, a Formominotomy [sic] was suggested.  I was still attending hand specialist therapy at Sue Caragianis’ clinic on Goodwood Road.  This lady after twelve months of treatment, finally made my claw into a hand again.  I still have limited touch, and palm at the scar sight is perpetually numb, my right thumb muscle is non existent, my right bicep and tricep are like jelly, and my grip is pitiful.

From 17/7/2000 until 27/11/2002 was by far the worst chapter in my life.  In this time I saw Dr. Cullum (nerve conduction) a top quality specialist, Di Gramp, a woman psychologist who helped me through some of the lowest of lows.  Then it was Professor Nigel Jones, a leading Neurologist.

Another M.R.I. Scan in which I was sedated showed different symptoms.  Dr. Cullum had advised me correctly not to have the afore mentioned foromonotomy [sic].  This started the next wave of treatment, Physio with Jan Barry (this woman is a legend) I got an [sic] TENS machine, a neck back support seat for driving and my own neck traction.  This really helped.

I was subjected to a physical “torture” test to see how I was progressing.  My grip and general movement was put to test by computer.  After trying to lift boxes, put nuts on bolts, and a full gammon of tests, the Workcover doctor found me to be sedentary.

After a thoroughly disgusting visit to a “Workcover” doctor, in which he actually injured me by pushing my right arm past where it could go in an upright thrust.  The pain in my neck was chronic.  I had to have physio to stop the neck spasm.

The next phase was also a shocker.  A doctor who said I’d gone “mad” prescribed me Epilon this was to settle the nerves in my neck.  After slowly building up to 3 a day I blacked out for the first time in my life.  I then saw Di Gramp who taught me pain control through meditation.

A NRMA meeting with a real “cowboy” infuriated me so much I had to walk out.  Never before had I felt such anger and depression from humiliation.  This “little man” is a real harmer.

You can see why I willingly accepted their meagre offering, just to get off the WorkCover “worked over” merry-go-round.

In March 2001, I received $33,360.00.  On S43 for 20% residual disability to my cervical spine down to and including my right elbow.  At no time was I told this would be lumped together when I got a further 10% (S43) residual disability for my lower right arm and hand.  On the 27/11/2002, I received after Workcover advocate intervention, $29,000.00 (S42) and the $5,480.00 (S43) afore mentioned.

A preclusion period was then set from 28/11/2002 to Christmas-eve 2003.  On the letter about the preclusion period it states on the 27/11/2002 I received $68,121.00.  This is a lie, I only received $34,480.00 but unbeknown to me they had secretly lumped both S43’s and S42 together.  So now I’ve got a pain in the neck, a numb hand, poor sleep patterns and hatred for bureaucracy.

Thank you for nothing.”  [T17/38-39]

The applicant reiterated these sentiments at the Hearing in the course of his oral evidence and submissions. 

12.     The applicant gave evidence that he has $70,000 in Perpetual Investment, this being the profit from the sale of his house and some furniture at Victor Harbor, but he cannot access this money until December 2003.  At the time of the original decision, on 11 December 2002, he had this money, and the $34,150.  By the time of the SSAT hearing on 30 April 2003, he had $19,000 in a managed account with BankSA.  He said that he now has only $6,000 left in BankSA, which he owes to his mother, and $70,000 in the Perpetual account.  He said that he is a manic depressant, and not good with money, and was so depressed that he thought he deserved some trips away before he undertakes the surgery on his left arm, which he expects will take 12 months to recover.

13.     The applicant said in evidence, that he has taken his mother on three cruises this year, January/February and June, on the SS Leo, and another on the Pacific Sky which cruised to Hong Kong, where he stayed for some time and returned to Australia by air.  He said that he considered that he "deserved that because of the pain and suffering I have suffered - I am a basket case".  He says also that the $70,000 profit from the sale of the house is his money and not relevant to these proceedings.  He plans to use that money to supplement the pension in the future.

14.     The Department contends that there has been nothing advised by the applicant that could lead to a consideration that his situation is special.  The legislation has operated correctly, and the applicant was sent notice of the correct preclusion period within 2 weeks of the settlement occurring.  Even if the applicant were to advance additional factors to support his argument, the fact of the money he holds in financial investments makes it inappropriate to exercise the discretion.  He currently holds significant assets, which he can use to support himself in preference to calling on the taxpayer for assistance.

15.     The Department contends, also, that although the applicant maintains he is unable to control his affairs because of his depression, he has been able to proceed through the appeal process to this Tribunal, and plan and organise 3 cruises during this year.

16.     I have examined the evidence carefully, in detail, and taken into account the parties' submissions.  The applicant is clearly very angry about the situation in which he now finds himself, but within 2 weeks of the payment of the lump sum he was advised of the preclusion period, up to December 2003.  He was advised again by the Authorised Review Officer, and at the SSAT hearing in April 2003.  As at 30 April 2003 he had $19,000 in the bank, and an unfavourable SSAT decision, but he proceeded to spend money on his cruise.  He has expended $13,000 in the 4 months since the SSAT decision, whereas the Disability Support Pension which he seeks is less than $10,000 per annum.  He has $6,000 in BankSA, and $70,000 in Perpetual Investment which he could access with the necessary penalties for early payment.  He has also only 4 further months of preclusion period ahead of him.  

17.     I do not accept the applicant’s submission that there are special circumstances in this matter.  I am satisfied, on the evidence, that his circumstances are such that it is not appropriate that the discretion available, pursuant to section 1184K of the Act, should be exercised in his favour.  For these reasons the Tribunal affirms the decision under review.

I certify that the 17 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member WJF Purcell

Signed:         .......................................................................................
  Associate

Date of Hearing  28 August 2003
Date of Decision  28 August 2003
Counsel for the Applicant         In person
Solicitor for the Applicant          -
Counsel for the Respondent     Mr J Underwood
Solicitor for the Respondent     Service Recovery Team