MICHELLE EDWARDS and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

[2009] AATA 131

Administrative Appeals Tribunal

DECISION AND WRITTEN REASONS FOR ORAL DECISION [2009] AATA 131

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2008/4847

GENERAL ADMINISTRATIVE DIVISION		)
Re		MICHELLE EDWARDS

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal   Mrs Josephine Kelly, Senior Member

Date of decision                2 February 2009

Date of written reasons   2 March 2009

Place  Sydney

Decision The decision of the Social Security Appeals Tribunal dated 9 September 2009 is affirmed.  

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

Senior Member
  Mrs Josephine Kelly

CATCHWORDS

SOCIAL SECURITY – Disability Support Pension – Rate– Term Deposits held by Applicant– Whether financial assets – Whether deposits held on trust for children – Held term deposits financial assets – Affect rate of payment - Decision affirmed

Administrative Appeals Tribunal Act 1975, s 43(2A)

Social Security Act 1991, ss 9, 1076, 1207V

WRITTEN REASONS FOR ORAL DECISION

2 March 2009 Mrs Josephine Kelly           

1. At the conclusion of the hearing of this application the terms of the decision made, and short reasons for decision, were stated orally. The Respondent requested written reasons for my decision under s 43(2A) of the Administrative Appeals Tribunal Act 1975, which are furnished below.

Issue

2.      Mrs Michelle Edwards receives Disability Support Pension (DSP) which is subject to assets and income tests.  The question the Tribunal has to answer is whether two term deposits in her maiden name "OBO", that is on behalf of, her three adult children, are relevantly held on trust, or whether they are her assets which must be taken into account in determining her rate of pension. 

3.      The reviewable decision, made by the Social Security Appeals Tribunal on 9 September 2008, was that the two term deposits should be taken into account in determining Mrs Edwards' rate of payment of DSP (s 1076 of the Social Security Act 1991 (the Act)). 

Background

4.      In June 2008, Mrs Edwards advised Centrelink that she had received an inheritance of $26,000.  A Centrelink officer decided to investigate existing term deposits recorded as "other assets" in Mrs Edwards' record which were recorded as being "in trust for the Applicant's children".  

5.      It is not in dispute that Mrs Edwards has three term deposits with the St George Bank, one in her maiden name, and two in her maiden name "on behalf of" her three adult children. 

Consideration

6.      Mrs Edwards told me of personal difficulties she has and also difficulties she has had with Centrelink.  It is not necessary to set out the details of those matters because they are not relevant to the matter I have to decide.

7.      Mrs Edwards' position in relation to the account in her name only was unclear.   If her position was that those funds were also held on behalf of her children, I make the finding that the funds are her asset and therefore properly taken into account in assessing the rate of DSP.  She was the source of those funds and has control of those funds.

8.      The following discussion refers only to the two term deposits held by Mrs Edwards on behalf of her children.  Mrs Edwards' evidence was that she has no will and has always held money on behalf of her children in case anything happened to her. Mrs Edwards told me she received advice from her bank to set up and name the accounts as she did. She said that the source of the funds in one of the term deposits was her savings over many years and the source of the funds in the other was an inheritance from her grandmother received in June 2008.

9.      I find that the money in both the relevant term deposits is in fact Mrs Edwards' money and the term deposits are relevantly her financial assets for the purpose of the Act (s 9 of the Act).  I agree with the SSAT that when the term deposits mature, Mrs Edwards may deal with the funds as she wishes, including putting them into an account or accounts in her own name.  I note that she made a partial withdrawal of funds from one of her term deposits in October 2008 and used the money for her own use. There was nothing before me to indicate that the children had contributed to the funds in the term deposits. It would not be unconscionable for Mrs Edwards to assert full beneficial ownership of the funds. I do not consider that the money in the two term deposits is held on trust by Mrs Edwards for her children. It follows that they are Mrs Edwards’ financial assets and must be taken into account in calculating Mrs Edwards rate of DSP (s 1076 of the Act).

10.     Even if there were a trust, I agree with the SSAT that Mrs Edwards passes both the source and control tests set out in s 1207V of the Act, which identify persons who either provide or control money held in private trust.  As she passes both those tests, other provisions in Pt 3.10 of the Act have the effect that 100% of money held in trust is attributed to her, and is to be taken into account in assessing her rate of DSP.

Decision

11.     For those reasons I affirm the reviewable decision.  The three term deposits are properly taken into account in determining Mrs Edward's rate of DSP payment.

I certify that the 11 preceding paragraphs are a true copy of the written reasons for the oral decision herein of Mrs Josephine Kelly, Senior Member.

Signed: ……[sgd].………..

Steven Mulipola, Associate

Date of hearing:  2 February 2009

Date of oral decision:  2 February 2009

Date of written reasons:  2 March 2009

Representative for the Applicant:             Self-represented

Representative for the Respondent:       Centrelink Legal Services and Procurement