Nawrozi and Secretary, Department of Education, Employment and Workplace Relations

[2008] AATA 1082

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 1082

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2008/1817

GENERAL ADMINISTRATIVE DIVISION		)
Re		MOHAMMAD NAWROZI

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Senior Member R W Dunne

Date4 December 2008

PlaceAdelaide

Decision The Tribunal affirms the decision under review.

..............................................

R W DUNNE
  (Senior Member)

CATCHWORDS

SOCIAL SECURITY – pensions, benefits and allowances – Youth Allowance – activity test – undertaking full-time study – not enrolled at an educational institution – overpayment of benefit – debt due to the Commonwealth – no administrative error – write-off of debt – special circumstances – decision affirmed

Social Security Act 1991 ss 23(1), 540, 541(1), 541B(1) and (5), 1217(4), 1223(1), 1236(1) and (1A), 1237A(1) and (1A), 1237AAD

Student Assistance Act 1973 ss 3(1), 5D(1)

Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Riddell v Secretary, Department of Social Security (1993) 30 ALD 31
Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25

REASONS FOR DECISION

4 December 2008   Senior Member R W Dunne   

introduction

1.      Mr Mohammad Nawrozi (“applicant”) had been receiving Youth Allowance as a full-time student in 2006.  He advised the respondent (“Centrelink”) that he would be continuing full-time study in 2007.  However, he travelled overseas and his Youth Allowance was cancelled.  Subsequently, Centrelink obtained information that suggested he had not enrolled for study in Australia in 2007 and a Centrelink officer decided that he was not qualified to receive Youth Allowance for the period from 29 January 2007 until 21 August 2007.  The officer decided that the applicant had incurred a debt, due to the overpayment of Youth Allowance, of $5,097.16 and required him to repay that amount.  He requested a review of the decision to raise and recover the debt and the Centrelink officer affirmed the decision.  It was referred to an Authorised Review Officer (“ARO”) who also affirmed the decision.  The ARO did, however, “write-off” recovery of the debt for a period of 4 weeks.  Mr Nawrozi applied to the Social Security Appeals Tribunal (“SSAT”) for further review.  When the SSAT affirmed Centrelink’s decision, he applied to this Tribunal for review of the decision of the SSAT.

2.      At the hearing, Mr Nawrozi represented himself and Mr Christian Goldsworthy (from Centrelink Legal Services & Procurement Branch) appeared for the respondent.  The Tribunal received into evidence the T documents (Exhibit R1) lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975, together with the following documents:

·Certificate of Completion, in the applicant’s name, from the Center of Excellence English Language Program (Exhibit A1);

·Certificate of Achievement, in the applicant’s name, for the trimester May-July 2007 from the Center of Excellence English Language Program (Exhibit A2);

·Respondent’s statement of facts and contentions, with supplementary documents 1, 2 and 3 (Exhibit R2); and

·ARO notes relating to the applicant dated 15 January and 16 January 2007 (Exhibit R3).

issues for the tribunal

3.      The following are the issues for the Tribunal:

(a)Was the applicant overpaid Youth Allowance during the period 29 January 2007 to 21 August 2007?

(b)If there has been an overpayment of Youth Allowance, does it constitute a legally recoverable debt?

(c)Should all or part of the debt be waived or written-off?

(d)Should all or part of the debt be waived because of an administrative error or special circumstances?

legislation

4.      The legislation that is presently relevant is contained in the Social Security Act 1991 (“Act”), the Social Security (Administration) Act 1999 (“Administration Act”) and the Student Assistance Act 1973 (“Student Assistance Act”). Sections 540, 541 and 541B of the Act deal with the requirements for and the entitlement to Youth Allowance. The qualification and activity test requirements are set out in ss 540 and 541. The relevant parts of those sections read:

“540     Qualification for youth allowance—general rule

Subject to this Subdivision, a person is qualified for a youth allowance in respect of a period if:

(a)      either of the following applies:

(i)throughout the period the person satisfies the activity test (see Subdivision B) or is not required to satisfy the activity test (see Subdivision C);

(ii)the person is a CDEP Scheme participant (see section 1188B) in respect of the period;

(b)throughout the period the person is of youth allowance age (see Subdivision D); and

(c)throughout the period the person satisfies any requirements relating to Youth Allowance Activity Agreements that apply to the person under Subdivision E; and

(d)      throughout the period, the person:

(i)        is an Australian resident; or

(ii)is exempt from the residence requirement within the meaning of subsection 7(7).

…

541    Activity test

General

(1)Subject to section 541A and subsection (3) of this section, a person satisfies the activity test in respect of a period if:

(a)the person satisfies the Secretary that, throughout the period, the person is undertaking full-time study (see section 541B); or

(b)subject to subsection (4), the person satisfies the Secretary that, throughout the period, the person is actively seeking, and willing to undertake, paid work in Australia (other than paid work that is unsuitable for the person); or

(c)throughout the period, the person complies with the terms of a Youth Allowance Activity Agreement applying to the person.

…”

5. Sub-section 541B(1) defines when a person is undertaking full-time study. It reads:

“541B  Undertaking full-time study

General

(1)      For the purposes of this Act, a person is undertaking full-time study if:

(a)      the person:

(i)is enrolled in a course of education at an educational institution; or

(ii)was enrolled in the course and satisfies the Secretary that he or she intends, and has (since no longer being enrolled) always intended, to re-enrol in the course when re-enrolments in the course are next accepted; or

(iii)was enrolled in the course and satisfies the Secretary that he or she intends, and has (since no longer being enrolled) always intended, to enrol in another course of education (at the same or a different educational institution) when enrolments in the other course are next accepted; and

(b)      the person:

(i)is undertaking in the particular study period (such as, for example, a semester) for which he or she is enrolled for the course; or

(ii)intends to undertake in the next study period for which he or she intends to enrol for the course;

either:

(iii)in a case to which subsection (1A) does not apply—at least three-quarters of the normal amount of full-time study in respect of the course for that period (see subsections (2) to (4)); or

(iv)in a case to which subsection (1A) applies—at least two-thirds of the normal amount of full-time study in respect of the course for that period (see subsections (2) to (4)); and

(c)the course in question is an approved course of education or study (see subsection (5)); and

(d)in the Secretary’s opinion, the person is making satisfactory progress towards completing the course.

…

(5)For the purposes of paragraph (1)(c), the course is an approved course of education or study if it is a course determined, under section 5D of the Student Assistance Act 1973, to be a secondary course or a tertiary course for the purposes of that Act.”

6. Sub-paragraph 541B(1)(a)(i) provides that a person is undertaking full-time study if he or she is “enrolled in a course of education at an educational institution”. The expression “educational institution” is defined in s 23(1) of the Act. When read with s 3(1) of the Student Assistance Act, it reads:

“23       General definitions

(1)      In this Act, unless the contrary intention appears:

…

educational institution means an education institution within the meaning of subsection 3(1) of the Student Assistance Act 1973.

…”

“3        Interpretation

(1)       In this Act, unless the contrary intention appears:

…

education institution means:

(a)       a higher education institution; or

(b)       a technical and further education institution; or

(c)       a secondary school; or

(d)any other institution (including an educational institution), authority or body, that is in Australia and that, in accordance with a determination by the Minister, is to be regarded as an education institution for the purposes of this Act.

…”

7. The expression “education institution” in s 3(1) of the Student Assistance Act is defined in a way that excludes such institutions outside Australia. The institutions and schools that are referred to in the defined expression are all institutions that are “in Australia”. The exclusion is also supported by the reference, in paragraph (d) of the definition of “education institution” to the Minister’s current determination, which is the Determination of Education Institutions and Courses: Under Subsections 3(1) and 5D(1) of the Student Assistance Act.

8. Other legislation that is presently relevant in the Act relates to the recovery of debts resulting from the overpayment of Social Security benefits, the waiver or write-off of such debts, including administrative error waiver and special circumstances waiver. Section 1223(1) deals with debt recovery by the Commonwealth and reads:

“1223  Debts arising from lack of qualification, overpayment etc.

(1)      Subject to this section, if:

(a)      a social security payment is made; and

(b)a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit;

the amount of the payment is a debt due to the Commonwealth by the person and the debt is taken to arise when the person obtains the benefit of the payment.”

9. Section 1236 provides for the write-off of a debt, for a stated period or otherwise. It reads:

“1236  Secretary may write off debt

(1)Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.

(1A)The Secretary may decide to write off a debt under subsection (1) if, and only if:

(a)      the debt is irrecoverable at law; or

(b)      the debtor has no capacity to repay the debt; or

(c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or

(d)it is not cost effective for the Commonwealth to take action to recover the debt.

…”

10. Sections 1237A(1) and (1A) provide for the waiver of the right to recover a debt that is attributable solely to an administrative error. They read:

“1237A  Waiver of debt arising from error

Administrative error

(1)Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.

(1A)Subsection (1) only applies if:

(a)the debt is not raised within a period of 6 weeks from the first payment that caused the debt; or

(b)if the debt arose because a person has complied with a notification obligation, the debt is not raised within a period of 6 weeks from the end of the notification period;

whichever is the later.”

11.     Section 1237AAD allows for the possibility of waiving all or part of a debt because of special circumstances.  It reads:

“1237AAD  Waiver in 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.”

background and evidence

12. As was found by the SSAT, the factual background to this case is not in dispute and may be repeated here. In December 2006, Mr Nawrozi was receiving Youth Allowance as a full-time student. On 8 December 2006, he completed a questionnaire obtained from Centrelink in which he stated that, from 10 January 2007 until 15 December 2007, he would be studying full-time for a Diploma (International Business) at TAFE SA, Adelaide City Campus. He continued to be paid Youth Allowance on the basis of the information provided in the questionnaire. In April 2007, he contacted Centrelink to inform them that he was intending to go overseas and that he would continue to be a full-time student while overseas. He initially intended to depart from Australia on 15 April 2007, but advised Centrelink that he would be departing on 23 May 2007. His Youth Allowance was automatically cancelled from 22 August 2007 on the basis that he had, at that time, been out of Australia for 13 weeks from 23 May 2007 (s 1217(4) of the Act). In September 2007, inquiries made by Centrelink suggested that he had not been enrolled at TAFE in 2007. When he did not respond to the letter sent to him about this, a Centrelink officer decided that he was not qualified to receive Youth Allowance for the period from the start of Semester 1, 29 January 2007 until 21 August 2007.

13.     In giving his evidence, Mr Nawrozi said that, before leaving Australia, he had worked because he needed funds to help his sister in Pakistan.  She was in need of an operation and he was the only family member able to help her after the death of their parents.  While in Pakistan and during the period his sister was recovering, he attended full-time English classes from May to September 2007.  He returned to Australia in October 2007.  Prior to leaving Australia, he had enrolled with TAFE to study the Diploma (International Business).  He attended a number of classes and would then pay the course fees.  However, because of his sister’s illness, he was unable to pay the fees before he left.  He had no student ID card or course materials.  Although his name had been called from the class roll, he had been unable to confirm his enrolment in the course.  As he had continued to receive Youth Allowance for part of the period he was in Pakistan, he believed the English language course he had undertaken there as part of the “Center of Excellence English Language Program” was an approved course for Youth Allowance purposes.  He had received letters from Centrelink dated 13 December 2006 and 29 January 2007, but believed he did not have to notify any change in his study load because he was intending to continue studying full-time during the 2007 year. 

consideration

Was the applicant overpaid Youth Allowance during the period 29 January 2007 to 21 August 2007?

14. There was no dispute that Mr Nawrozi satisfied the criteria for Youth Allowance in paragraphs (b), (c) and (d) of s 540 of the Act. Also, he was not a CDEP Scheme participant under sub-paragraph (a)(ii). In order to qualify for Youth Allowance, he must satisfy the activity test in sub-paragraph (a)(i), which in turn meant that he must be undertaking full-time study within the meaning of s 541(1)(a). He did not satisfy the requirements contained in paragraphs (b) and (c) of s 541(1).

15. To be undertaking full-time study under s 541B(1), he must have been enrolled in a course in education at an educational institution (paragraph (a)(i)) and the course must be an approved course of education or study (paragraph (c)). Having regard to the meaning of “educational institution” in s 23(1) and to the provisions of s 541B(5) of the Act, I am satisfied that, during the period 29 January 2007 until 21 August 2007, Mr Nawrozi was not enrolled in a course of education at an educational institution. On the evidence, Mr Nawrozi did not pay any enrolment fees to TAFE in respect of the 2007 year. He did not have a student ID card, nor did he receive course materials. Although he was unsure, it could not be expected that he would appear on student rolls, in circumstances where he had not paid the enrolment fee. I have reviewed the respondent’s overpayment printout details in the T documents (Exhibit R1, T4) and I am satisfied that the overpayment of Youth Allowance of $5,097.16 to Mr Nawrozi, during the period 29 January 2007 to 21 August 2007, was correctly calculated.

Does the overpayment of Youth Allowance constitute a legally recoverable debt?

16. As I have already stated, I am satisfied that the overpayment and the debt calculation in respect of Youth Allowance paid to Mr Nawrozi was correctly determined by Centrelink. Section 1223(1) of the Act provides that, where a Social Security payment (such as Youth Allowance) is made and the recipient was not entitled to the payment, the amount is a debt due to the Commonwealth by the recipient and is taken to arise when he or she obtains the benefit of the payment. In the case of Mr Nawrozi, I agree with the conclusion reached by the SSAT. I am satisfied that the overpayment of Youth Allowance of $5,097.16 made to him is a debt recoverable by the Commonwealth under s 1223(1).

Should all or any part of the debt be written-off under s 1236 of the Act?

17. Under s 1236(1A), the respondent may write-off a debt for a stated period or otherwise only in the following situations:

(a)      If the debt is irrecoverable at law.  I have already found that the debt in the present case is recoverable at law. 

(b)      If the debtor has no capacity to repay the debt.  On the evidence before me, I am satisfied that the applicant has the capacity to repay the debt.

(c)If the debtor’s whereabouts are unknown.  This exception is not presently applicable.

(d)      If it is not cost effective for the Commonwealth to take action to recover the debt.  Having regard to the submissions put by Mr Goldsworthy, I accept that it is cost effective for the Commonwealth to take action (or to continue to take action) to recover the debt.

18. It follows that the debt is not capable of being written-off for a stated period or otherwise, pursuant to s 1236(1A) of the Act.

Should all or part of the debt be waived because of an administrative error?

19. There can be no question that Mr Nawrozi did not receive in good faith Youth Allowance, which was overpaid to him during the relevant period. However, in considering the application of s 1237A(1), I am not satisfied, on the evidence before me, that any part of the debt was attributable solely to an administrative error made by the Commonwealth. In these circumstances, the debt should not be waived under s 1237A(1) of the Act.

Should all or part of the debt be waived because of special circumstances?

20. Under s 1237AAD, the Tribunal may waive the right to recover all or part of the debt if it is satisfied that the debt did not result from the debtor knowingly making a false statement or representation or failing to comply with a provision of the Act, and that there are special circumstances (other than financial hardship alone) that make it desirable to waive the debt. It was submitted by Mr Goldsworthy that Mr Nawrozi knowingly failed to inform Centrelink of income from employment he derived before departing for Pakistan. It was Mr Nawrozi’s evidence that he called Centrelink and told the agency about this income. I accept his evidence on this point and find that the applicant did not knowingly fail to comply with a provision of the Act or the Administration Act.

21.     The expression “special circumstances” has been considered on numerous occasions by Courts and Tribunals.  In the case of Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the Tribunal said (at page 3):

"...

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 on 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. This 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."  (emphasis added)

22.     In Groth v Secretary, Department of Social Security (1995) 40 ALD 541, Kiefel J, after referring to the Federal Court’s decision in Re Beadle, observed that special circumstances:

"... would require something to distinguish Mr Groth’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. ..."

23.     In Riddell v Secretary, Department of Social Security (1993) 30 ALD 31, the Full Court of the Federal Court said at page 38:

"Each particular case must be considered on its merits. It is the essential nature of the provision to create a broad discretion to meet the great variety of circumstances which must occur, raising considerations of individual hardship, need, fairness, reasonableness, and whatever else may move an administrator, keeping in mind the scope and purposes of the Act, to make a decision one way or the other."

24.     Finally, in Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25, Besanko J in the Federal Court said (at paragraph 33) when referring to the test of special circumstances:

“ … The danger is that the test will be overstated if the word ‘exceptional’ is emphasised. It was not the intention of Parliament to confine the exercise of the discretion to an exceptional case. 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. …”

25.     I appreciate that Mr Nawrozi may experience difficulty I repaying the debt that has arisen due to the overpayment of Youth Allowance to him.  However, I am satisfied that his financial circumstances, whilst they may be straitened and stressful at times, are not such that they can be categorised as “special”.  Thus, I am of the view that there are no special circumstances that would warrant the waiving of the debt, and I so find.

decision

26.     The Tribunal affirms the decision under review.

I certify that the 26 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member R W Dunne

Signed:         ..........J Coulthard............................................
  Associate

Date of Hearing  25 August 2008
Date of Decision  4 December 2008
Advocate for the Applicant       Self-represented

Advocate for the Respondent   Mr C Goldsworthy

Centrelink Legal Services & Procurement    Branch