Milovanovic and Secretary, Department of Social Services (Social services second review)

This matter concerned a review by the Administrative Appeals Tribunal of decisions made by the Department of Human Services to recover compensation charges from Mr and Mrs Milovanovic. The applicants had received compensation payments for arrears of payments related to a workplace injury sustained by Mr Milovanovic in 1995, which had led to significant and ongoing health complications, including chronic pain, depression, anxiety, a mood disorder, and an acquired brain injury following a fall in 2008. The Department had recovered substantial amounts from these compensation payments, totalling $52,822.40 for Mr Milovanovic and $37,264.93 for Mrs Milovanovic.

The Tribunal was required to determine whether the recovery of the compensation charges by Centrelink was in accordance with the relevant legislation and, crucially, whether there were any special circumstances that would justify treating a portion of the compensation payment as if it had not been made or was not liable to be made. The applicants did not challenge the calculation of the compensation charge or the Department's application of the recovery provisions, but rather objected to the policy intent of the legislation and argued for the exercise of discretion based on their circumstances.

The Tribunal found that the compensation payment was for periodic payments in arrears and not a lump sum, and that the calculation and recovery steps taken by Centrelink were in accordance with the Act. However, the Tribunal was satisfied that special circumstances existed, which it interpreted as unusual, uncommon, or exceptional circumstances that stood out from the usual run of cases and justified a departure from the general rule. In particular, the Tribunal noted that a significant portion of the compensation payment had been used to cover substantial legal costs incurred by the applicants. Consequently, the Tribunal exercised its discretion under section 1184K of the Act to treat $29,099 of the compensation amount as not having been made or liable to be made. The Tribunal set aside the original decisions and remitted the matters to the Department for reassessment, directing that this portion of the compensation payment be disregarded.