Neivandt and Department of Family and Community Services
[2000] AATA 1115
•24 November 2000
DECISION AND REASONS FOR DECISION [2000] AATA 1115
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2000/436
GENERAL ADMINISTRATIVE DIVISION )
Re CONWAY NEIVANDT
Applicant
And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Dr EK Christie, Member
Date24 November 2000
PlaceBrisbane
Decision The Tribunal sets aside the decision under review and in substitution therefor decides that the overpayment of disability support pension for the period 18 November 1999 to 22 November 1999 be waived. This means Mr Neivandt's application is partly successful.
(Sgd) EK CHRISTIE
MEMBER
CATCHWORDS
SOCIAL SECURITY - disability support pension - overpayment - whether debt due to Commonwealth may be waived - administrative error - special circumstances.
Social Security Act 1991 ss 1237A, 1237AAD
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
The Standard Minimum Rules for the Treatment of Prisoners (United Nations, Economic and Social Council, 1957)
ORAL REASONS FOR DECISION
24 November 2000 Dr EK Christie, Member
This is an application by Conway Neivandt for a review of a decision of the Social Security Appeals Tribunal ("the SSAT") made on 18 April 2000 to raise and recover an overpayment of disability support pension ("DSP") of $1,151.74 for the period 18 November 1999 to 23 December 1999. The SSAT decision affirmed a decision of a Centrelink Authorised Review Officer made on 3 March 2000.
In reaching its decision the Tribunal concluded that there were no grounds to waive the debt because of "administrative error" or "special circumstances".
Mr Neivandt represented himself at the hearing. The respondent was represented by Mr P Kanowski, a Departmental Advocate.
At the hearing the Tribunal had in evidence before it documents lodged pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 – the "T" Documents (Exhibit 1) and the following exhibits:
Exhibit 2 Centrelink documents filed 17 November 2000
Exhibit 3 Centrelink documents filed 2 November 2000.
At the end of the hearing the Tribunal sought confirmation from the Department of the time Mr Neivandt was detained in the Maroochydore Watchhouse. The Department advised on 27 December 2000 that he was detained from 18 November 1999 to 22 November 1999.
Issues before the TribunalThe only issue for the Tribunal to decide was whether the overpayments of DSP could be waived in part or in full because of the "administrative error" or the "special circumstances" provisions of the Social Security Act 1991.
FactsMr Neivandt acknowledged the following findings of fact made by the SSAT:-
"(i) Mr Neivandt was in receipt of disability support pension at all material times.
(ii)On 3 November 1999 he was sent a notice which among other things required him to advise Centrelink within fourteen days if he were sent to jail after being convicted of an offence.
(iii)On 18 November 1999 he was jailed after being convicted of an offence but he was released on appeal bail on 24 December 1999.
(iv)Centrelink continued to pay two regular instalments of disability support pension in the sum of $1,151.74 during that period of imprisonment. That sum included rental assistance." [Document T1 Folio 7]
The debt is currently being recovered with instalments of $30 per fortnight.
Evidence of Conway Neivandt
Mr Neivandt submitted that Centrelink had made an administrative error by continuing to pay him DSP whilst he was imprisoned as he had taken steps to notify Centrelink.
For the initial period of imprisonment he was held in the Maroochydore Watchhouse, "watchhouse rules" applied. This meant phone calls were non-existent, movement was restricted and Police were too busy to care about personal problems of prisoners – such as DSP payments. Police had responded to his query about advising Centrelink of his situation stating that they would sort it out for him. However, this proved not to be the case.
On induction at Arthur Gorrie Penal Centre, Mr Neivandt had asked a social worker about advising Centrelink as to his DSP. He was told "don't worry, we'll look after it". Mr Neivandt said that he never saw the social worker again but believed that his enquiry would be looked into and addressed.
One week later Mr Neivandt was transferred to Woodford Prison Farm. On arrival he had asked to see a social worker so that he could check on the status of his DSP. However, because of a very high prisoner:social worker ratio, his enquiry was considered low priority and so he did not ever see the social worker. Mr Neivandt said that prison policy was that he could only contact a Government Department through the Official Visitor or Ombudsman. However, this step could take a few weeks.
During the period he was imprisoned at Woodford Prison Farm, Mr Neivandt said that he believed that Centrelink was aware that he was in prison because he had advised the social worker of his situation and had been advised that they would look after it.
During cross-examination, Mr Neivandt:
acknowledged that he had access to mail services whilst in prison (see Document T13 Folio 74);
disagreed that there was no prohibition on prisoners to send correspondence to Government agencies;
stated that the options of assistance to complete Centrelink forms and to fax the forms were not open to him whilst in prison;
stated that whilst in prison he was unaware that he was receiving DSP entitlements;
acknowledged receiving the Centrelink notification notice dated 3 November 1999 (see Document T2 Folio 23); and
stated that following his release from prison he believed his DSP had been automatically reinstated as he did not apply to have his DSP restored.
Contentions and Submissions of the Parties
Mr Kanowski submitted that Mr Neivandt acknowledged that he received the Department's notification notice of 3 November 1999 (Document T2) which made him aware of his obligations as a DSP recipient to advise Centrelink that he was imprisoned. However, Mr Kanowski submitted that the first time Mr Neivandt informed Centrelink of his imprisonment was when he responded to a Centrelink letter dated 24 January 2000 informing him of a Corrective Services data match.
Mr Kanowski contended that the debt arose under Section 1224 because DSP was paid to Mr Neivandt because he failed to comply with a provision of the Act. Mr Neivandt failed to comply with the notice sent to him under Section 132. In addition, he did not notify Centrelink prior to Court proceedings that imprisonment may happen. Furthermore, Mr Kanowski contended that once imprisoned, Mr Neivandt did not notify Centrelink that he was in jail.
Mr Kanowski submitted that the obligation to notify Centrelink was a personal obligation attaching to Mr Neivandt (see Re Junor and Secretary, Department of Social Security (1997-98) 48 ALD 326). He contended that a personal obligation was not discharged by seeking to have another person discharge it or accepting another person's offer to discharge it. The Department of Corrective Services was not under an obligation to notify Centrelink on Mr Neivandt's behalf.
Mr Kanowski contended that the debt could not be waived because of administrative error because the failure of Mr Neivandt to notify Centrelink of his imprisonment was the primary cause of his imprisonment. That is, the error had not been solely caused by administrative error. Furthermore, it was Mr Kanowski's contention that the payments of DSP were not received in good faith by Mr Neivandt because he was aware that he was not entitled to DSP whilst imprisoned. Mr Kanowski submitted that when a person knows that they are not entitled to a social security payment, they do not receive it in good faith even if they are unaware that it is being received (see Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997-98) 50 ALD 186).
Mr Kanowski contended that the debt could not be written off under the "special circumstances" provisions of the Social Security Act because:-
Mr Neivandt knowingly failed to comply with a provision of the Act. He knew that he was required to notify Centrelink of his imprisonment and he did not do so. A knowing failure need not be fraudulent (see Re Callaghan and Secretary, Department of Social Security (1996-97) 45 ALD 435 at 445); and
there were no special circumstances that made it desirable to waive the debt. Financial hardship alone was not a sufficient basis for waiver under Section 1237AAD. Further, it was not desirable that the debt be waived, as Mr Neivandt was paid public monies that were not payable to him and which he knew were not payable to him. These monies should now be repaid. Mr Neivandt had the capacity to repay the debt by way of withholdings from his pension.
Mr Neivandt contended:
that he was not personally responsible for the overpayment as he had taken steps to advise Centrelink of his imprisonment. That Centrelink had made an "administrative error" by the continuation of DSP payments during the duration of imprisonment;
that because of the circumstances surrounding the issue, the debt had not been waived;
that deductions to recover the debt were made to his entitlement even though the matter was currently going through the appeal process; and
that the issue of a reduction of his entitlement, while the matter was under appeal, had been raised with the Area Review Officer but had not been answered.
Consideration of the Issues
The objective of the Tribunal is to review administrative decisions not only on their merits, but in accordance with the law at all times. The relevant legislation is the Social Security Act 1991.
Section 1237A(1) of the Act provides for a waiver of a debt due by a recipient of social security where a debt arose from "administrative error".
"SECTION 1237A – WAIVER OF DEBT ARISING FROM ERROR
1237A(1) Administrative error. 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.Note:Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor)."
Section 1237AAD of the Act provides for a debt due by a recipient of social security to the Commonwealth to be waived because of "special circumstances".
"SECTION 1237AAD – WAIVER IN SPECIAL CIRCUMSTANCES
1237AAD The Secretary may waiver 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 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."
In Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the Court acknowledged that the phrase "special circumstances" was "incapable of precise or exhaustive definition", nevertheless the Court stated that the circumstances "must have a particular quality of unusualness that permits them to be described as special".
On consideration of all the evidence before the Tribunal, the Tribunal concludes that there is a basis for a partial waiver of the debt, i.e. for the period 18 November to 22 November 1999 when Mr Neivandt was detained in the Maroochydore Watchhouse. The circumstances which applied here compared with his detention at Arthur Gorrie Correctional Centre and the Woodford Prison Farm were "unusual", even "exceptional", in terms of his opportunity to make Centrelink aware of his situation.
The procedures in place at the Arthur Gorrie Correctional Centre have been described by Jillian Rowe, Offender Development Manager, (16 November 2000) as:-
"At the Arthur Gorrie Correctional Centre we are well aware of the implications for inmates who do not notify Centrelink about their incarceration. To assist inmates we have a process available whereby our Counselling staff assist inmates by supplying them with the forms provided by Centrelink. Counsellors will then fax completed forms directly to the Centrelink Office for processing. This practice is voluntary for inmates as we cannot compel an inmate to complete the form, nor can we breach confidentiality by providing Centrelink with the information. Counsellors simply provide the means of ensuring that information provided by the inmate is conveyed to the appropriate authority. This process was in place and operating at the time Mr Neivandt was incarcerated at the Arthur Gorrie Correctional Centre."
However, the Tribunal concludes that on the balance of probabilities, these procedures did not exist at the Maroochydore Watchhouse. Mr Neivandt raised the issue of his DSP entitlement and the need to notify Centrelink in the only manner possible to him – directly with the Police. However, this was not acted upon and, consequently, an overpayment was made to him during the period he was detained in the Maroochydore Watchhouse. Accordingly, the "watchhouse rules" described by Mr Neivandt in his evidence are "unusual" and so warrant the description of "special circumstances". The period Mr Neivandt was held in the Maroochydore Watchhouse was 18 November to 22 November 1999.
However, the Tribunal concludes that following the placement of Mr Neivandt in the Arthur Gorrie Correctional Centre and the Woodford Prison Farm, the "watchhouse rules" were replaced by Corrective Services Procedures which provided inmates with an opportunity to notify Centrelink. Consequently, the circumstances that applied for the debt that accrued 23 November 1999, and beyond, could not be described as "special circumstances".
The Tribunal agrees with the SSAT that Mr Neivandt did not knowingly or deliberately contravene the Act (Document T2 Folio 26).
Accordingly, as the requirements of paragraphs (a) and (b) of Section 1237AAD of the Social Security Act are met, then the debt accrued over the period 18 November to 22 November 1999 should be waived because of "special circumstances".
However, the balance of the debt (23 November to 23 December 1999) remains as a debt due to the Commonwealth which is to be recovered. The debt accrued over this period when Mr Neivandt was imprisoned in the Arthur Gorrie Correctional Centre and the Woodford Prison Farm cannot be waived because of "special circumstances" (see paragraph 25).
Nor can the debt over 23 November to 23 December 1999 be waived because of "administrative error" because the Tribunal agrees with the SSAT that:-
"He also knew that he was not entitled to be paid during an imprisonment. That knowledge is relevant to the question of good faith. Even if he did not know that the monies were being credited to his account he cannot invoke good faith because he knew he was not entitled." [Document T2 Folio 27]
As the DSP entitlements received during this period were not received in good faith, the Tribunal finds that the debt cannot be waived under the "administrative error" provisions of the Social Security Act.
The Tribunal makes the observation that it may be appropriate for Centrelink to monitor the procedures currently in place at Arthur Gorrie Correctional Centre and Woodford Prison Farm to assist prisoners informing Centrelink of their detention. The fact that 73 prisoners were identified on a Queensland Corrective Services data match on 8 December 1999 (see Exhibit 2: Jenny Cook, Projects Compliance Area Pacific Control, 17 November 2000), suggests there may be a problem on the effectiveness of the existing procedures in this regard. The Standard Minimum Rules for the Treatment of Prisoners (UN Economic and Social Council, 1957): "Information to Prisoners" justifies such action by Centrelink. It would provide socio-economic benefits for both Centrelink and prisoners.
The Tribunal makes the further observation that Mr Neivandt be consulted by Centrelink so that an appropriate amount of instalments can be mutually agreed upon, consistent with his financial circumstances, in order to recover the balance of the debt due to the Commonwealth.
For all of the above reasons the Tribunal decides:
(a)to waive the debt accrued over the period 18 November 1999 to 22 November 1999; and
(b)that the debt accrued over the period 23 November 1999 to 23 December 1999 remains as a debt due to the Commonwealth and is to be recovered.
I certify that the 35 preceding paragraphs are a true copy of the reasons for the decision herein of Dr EK Christie, Member
Signed: Denise Burton
SecretaryDate/s of Hearing 24.11.00
Date of Decision 24.11.00
Rep. for the Applicant Applicant appeared in person
Solicitor for the Respondent Mr P Kanowski, Departmental Advocate
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