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

[2011] AATA 272

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2011] AATA 272

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2010/4637

GENERAL ADMINISTRATIVE DIVISION		)
Re		EVELYN NICHOLSON

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal G. D. Friedman, Senior Member

Date5 April 2011

PlaceMelbourne

Decision The Tribunal affirms the decision under review.

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

Senior Member

ADMINISTRATIVE

APPEALS TRIBUNAL

MR G.D FRIEDMAN, Senior Member

No.  V2010/4637

EVELYN NICHOLSON

and

SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

EXTRACT OF TRANSCRIPT OF PROCEEDINGS

MELBOURNE

TUESDAY, 5 APRIL 2011

MS E. NICHOLSON appears in person

MS A. BRAMLEY appears for the respondent

SOCIAL SECURITY – Austudy overpayment – whether applicant notified Centrelink of cessation of study – whether special circumstances – whether debt should be waived or written off

EXTRACT OF TRANSCRIPT OF PROCEEDINGS

MR FRIEDMAN:   The matter before me is a decision made by Centrelink to raise and recover debts of $16,994.60 and $3422.76 respectively which were debts incurred by Ms Nicholson for payment of Austudy in the periods 1 September 2008 to 14 September 2010 and 1 April 2008 to 20 July 2008.  That decision was affirmed by the Social Security Appeals Tribunal on 7 October 2010.  The issues are whether Ms Nicholson received Austudy payments to which she was not entitled and, therefore, was there a debt to the Commonwealth and, if so, whether that debt, or the two debts, should be waived or written off. 

Ms Nicholson was in receipt of Newstart Allowance from 13 November 1998 until
31 January 2007, and then Austudy from 1 February 2007 to 6 October 2010 and resumed Newstart Allowance on 7 October 2010.  She told the Tribunal that in 2007 she enrolled for a course in industrial safety at RMIT University for 2008.  She said that the course – the degree course was a four year course, but she believes that she was enrolled initially in the diploma course and she was enrolled only for first term, because she said that the enrolment costs were high and she was planning to take it term by term because it was very expensive. 

She said that she found, after enrolling in the course, that the costs involved were more than she could afford.  Those costs being travel to and from university, books and other costs associated with undertaking the course.  She said that she did not actually complete any of the course and, in all the circumstances, that she discontinued the course.  She said that she notified Centrelink that she was no longer enrolled in the course.  She then enrolled in a course at Kangan Batman TAFE, and that was a commercial course that began in 2009.  It was a Certificate 3 Financial Services (Accounts) Clerical course and a Certificate 4 in Financial Services Accounting.

MS NICHOLSON:   Legal study.

MR FRIEDMAN: Yes, I beg your pardon, it was a legal studies course. She said that she initially tried to complete the course, but for various reasons, including the costs, she did not hand in any assessable work and she discontinued the course. She said that she indicated to Centrelink that she had discontinued the course. Records provided to the Tribunal indicate that, on 17 January 2008, she was issued a notice under section 68 of the Social Security Administration Act 1999 stating that Austudy payments were based on her enrolment in the RMIT course, and that letter contained the usual information about the obligation on her to inform Centrelink if she ceased to become a full-time student.

Further correspondence was sent by Centrelink, according to the records, on 3 April 2008, that was an account statement; 26 June 2008, another account statement;
27 June 2008, that was an update of the activity agreement.  And the Centrelink records indicate that the terms of the agreement included:

I will undertake 25 hours per fortnight of full-time education or training with RMIT Melbourne from 27 June 2008 to 31 December 2008. 

The records indicate further that Centrelink issued Ms Nicholson with an account statement on 18 September 2008, and a further account statement on 11 December 2008 and on 5 March 2009. And the Centrelink records indicate that, on 24 April 2009, she attended an appointment at Centrelink. The record of that appointment, as set out in the … record of electronic notices, indicates that she advised of a change in educational institutions and provided proof of enrolment at Kangan Batman TAFE. On the same day, 24 April, 2009, she was issued with a further notice under section 68 of the Administration Act based on her full-time study at Kangan Batman TAFE and, once again, the letter contained details of her obligation to inform Centrelink if she stopped … [full-time study].

On 20 August 2009, Centrelink issued Ms Nicholson with an account statement based on Kangan Batman TAFE, and on 2 November 2009 Centrelink advised her that records indicated that the course at Kangan Batman TAFE ended on
27 November 2009 and requested that she advise what she intended to do in the following study period. The records further indicate that, on 6 November 2009, she contacted Centrelink by telephone and the electronic record of that contact indicates that she advised that she would be continuing to study in the next semester. A further notice under section 68 of the Administration Act was issued on 6 November 2009 based on her full-time study at Kangan Batman TAFE and the usual statement of her obligations was attached.

The records also indicate that, on 12 November 2009, she was issued with a further account statement and she was asked to confirm that the details – that is, study at Kangan Batman TAFE – were correct.  On 2 December 2009, Ms Nicholson contacted Centrelink in relation to a request to provide proof of her enrolment in 2008 and 2009.  The annotated record from Centrelink indicates that she advised she was studying at RMIT in 2008 and at Kangan Batman in 2009.  On 3 December 2009, Centrelink received information from Kangan Batman regarding her enrolment, and on 28 January 2010 the records indicate that Ms Nicholson contacted Centrelink and, again, advised she was enrolled at Kangan Batman TAFE in 2009 and 2010.

On 15 February 2010, Centrelink received information from Kangan Batman that
Ms Nicholson was enrolled in an advanced diploma of business, but withdrew from the whole course.  And Centrelink received further information from RMIT University in February and March 2010 advising that she was enrolled in the Bachelor of Science (Occupational Health and Safety) course and effectively withdrew from that course on 31 March 2009, although handwritten annotations suggest the date of withdrawal is, more properly, 31 March 2008, and that seems to accord with both the records by Centrelink and also Ms Nicholson’s evidence today. 

On 20 May 2010, RMIT University advised that Ms Nicholson’s enrolment was discontinued on 31 March 2009 for administrative reasons, but the effective date of discontinuation was 31 March 2008 for semester 1 … [and] 31 August 2008 for semester 2.  …  [O]n 18 June 2010, Centrelink received information from Kangan Batman TAFE advising that Ms Nicholson was enrolled on a full-time basis in the first semester of 2010, part-time in second semester 2010.  She was then issued with notices by Centrelink relating to the debt.  The relevant legislation is the Social Security Act 1991 and the [Social Security] (Administration Act) 1999. And qualification for Austudy is set out in section 568A of the Social Security Act, which requires that a person satisfies the activity test if that person, throughout the period, is undertaking qualifying study which is defined in sections 568A and 569C of the Act. And those sections refer to being enrolled in a course and being a full-time student.

I find that Ms Nicholson ceased to satisfy the activity test for the purpose of section 569(1) from 31 March 2008, as she was not enrolled in and undertaking qualifying study on a full-time basis. And, similarly, there is no evidence that, at Kangan Batman in 2009, she commenced studies … [or] attended classes. Section 68 of the Administration Act – and I have referred to a number of letters that were sent pursuant to that section of the Act – require a person to inform the department if certain events occur.

I have referred to letters sent to Ms Nicholson on 17 January 2008, 3 April 2008,
26 June 2008, 18 September 2008, 11 December 2008, 5 March 2009, 22 March 2009, 20 August 2009 and 6 November 2009 which were notices issued under that section of the Act requiring Ms Nicholson to notify Centrelink if her study load changed or she ceased study. Ms Nicholson said that she had advised Centrelink she did not attend classes in 2008 and 2009. She further said that she did not receive any of the letters sent to her under section 68 of the Administration Act. She said that she had problems with her mail; that her letterbox had been vandalised and that the landlord took a long time to fix her letterbox so that she could receive mail.

She produced her diaries for 2007, 2008 and 2009, which were calendars on which she had written, she said, important events including the receipt of mail, and she said in the witness box that she recorded all mail she received during that period.  When I examined the calendars for 2007, 2008 and 2009, I could find no reference to any mail received on any day, much less mail from Centrelink.  Ms Nicholson said she did not receive any of the letters sent by Centrelink even though I’m satisfied they were sent to her proper address.  When questioned, she could also not identify any letters that she had received from any other person, institution or utility companies such as gas, electricity company, [or] telephone company.

She said she had had a lot of dealings with the Privacy Commissioner of Victoria and the Commonwealth Privacy Commissioner [and] the Magistrates Court where she was dealing with the dispute with her neighbours.  I do not accept her evidence that she did not receive any mail at all during that period, and I’m satisfied that the problems with the letterbox did not extend for the whole of 2007, 2008 and 2009.  …  [I am also] satisfied that she either didn’t read the letters from Centrelink or she discarded them or chose to ignore them, and I find that the letters were properly sent, and I find that they were received or were deemed to be received by …
[Ms] Nicholson when they were sent by Centrelink.

I also find that the records by Centrelink, as set out in their electronic record of contact between Ms Nicholson and Centrelink, clearly show that on a number of occasions where she made contact with Centrelink she confirmed her enrolment in both the RMIT course and the Kangan Batman course.  I do not accept her claim that all those records are incorrect.  There is, in my view, no possibility that all those officers making records, when contacted by … [Ms Nicholson], could have entered them incorrectly.  Ms Nicholson’s recollection of when she went to Centrelink is very hazy – to put it … [at] its mildest – and in my view, her evidence was unsatisfactory in connection with her claim that she did notify Centrelink.

She said that when she told Centrelink she was no longer studying, it was really up to Centrelink to put her on the correct allowance, which in her case would have been Newstart allowance.  [B]ut she had been on Newstart since 1998 before going on Austudy, and she knew that there were requirements in terms of satisfying the activity test, in going for jobs, in filling in forms every three months, she said, and for her to say that she thought that Centrelink would have – or should have – put her straight onto Newstart when she told them she was no longer studying, … flies in the face of all the material I have before me, and I do not accept … [her] evidence. 

When she was questioned, she admitted continuing to receive Austudy payments when she, on her own evidence, had discontinued studying at those two institutions. So, in my view she knew full well that she was still … [r]eceiving Austudy, and [if] she wanted to go back onto Newstart, she knew the procedure by then was to go along to Centrelink and say, “Look, I’m no longer eligible for Austudy. I wish to apply for Newstart.” Centrelink does not do these things automatically, and her evidence was most unsatisfactory … [with regard to] that. Consequently, I find that … [she] failed to comply with the notices under section 68, subsection (2) of the Administration Act, and therefore, under section 1223, subsection (1) of the Social Security Act 1991,
I find that the overpayments that she received from 1 April 2008 to the end of first semester 20 July 2008, and from 1 September 2008 to 14 February 2010 … [constitute] a legally recoverable debt under that section of the Social Security Act.

The second issue is whether the debt should be waived or written off.  Section 1236 of the Act provides for a debt to be written off.  Ms Nicholson is currently having $30 per fortnight deducted from her Newstart allowance.  She receives approximately $437 a fortnight from which she pays $115 a fortnight, approximately, in rent, and
I find that although she said that she’s in financial difficulty – … I’m not disputing that it’s difficult to manage on Newstart allowance – I find that the criteria for writing off the debt are not met, and the debt is not irrecoverable at law, and it’s appropriate that she continue to repay the debt at $30 per fortnight. 

The other issue is whether the debt can be waived. Section 1237A, subsection (1) of the Social Security Act provides that a debt may be waived or partially … waived on the grounds of sole administrative error … Ms Nicholson said that there was sole administrative error.

In view of my findings that she did not comply with section 68, subsection (2) … notices that were sent to her … and the result of my findings in relation to the records made by Centrelink of her contacts with … [them] regarding her continuing enrolments in both the RMIT course and the Kangan Batman course, I find that there is no administrative error by Centrelink, and even if on one or two occasions the … Centrelink records were not 100 percent accurate, I find that the debt was not caused … [by] sole administrative error by Centrelink, so the waiver under section 1237A cannot be applied in this case.

The other provision for waiver of the debt is section 1237AAD of the Social Security Act. That provides that the debt can be written off if I’m satisfied that there are special circumstances to waive the debt and the debt did not result wholly or partly from the debtor or another person knowingly making a false statement or failing or omitting to comply with the section of the Act. In this case, Ms Nicholson submitted that she was going through a difficult period. She had obtained a number of interim intervention orders against her neighbours; they were abusive, and her time was taken up with dealing with that issue, which was very stressful for her.

I accept her evidence that that was a stressful time for her; that dealing with the neighbours must have been very difficult, and going along to court, seeking intervention orders, must have been difficult. I also accept her evidence that she had made a complaint about an officer of her Job Network Provider, and that she was dealing with the Privacy Commissioner of Victoria and the Federal Privacy Commissioner, and she also referred to the Federal Court, and that that was a stressful period as well, so I accept that those periods were stressful for her. The term “special circumstances” is not defined in the Social Security Act, but a number of cases that have dealt with that are Beadle v Director-General of Social Security (1984) 6 ALD 1, where the Tribunal held that “special circumstances” looks at situations which are unusual, uncommon or exceptional.

[There are a] … number of other cases, such as Angelakos v Secretary, Department of Employment and Workplace Relations,  [where] the Federal Court said that unusual or uncommon is more appropriate, … in that there must be something that distinguishes the case from the ordinary or the usual case, and there are several decisions relating to Austudy payments:  Hudson v Secretary, Department of Education, Science and Training (2006) AATA 226 is one; and Secretary, Department of Education, Science and Training v Brown (2007) AATA 1659 where the Tribunal said:

The principal issue is whether Ms Brown’s circumstances are so special and unique the debt should be waived.

And the Tribunal concluded in that case:

The reality is that many individuals enrol in Austudy funded courses, only to discover they cannot complete them for a variety of reasons and then fail or withdraw.

Ms Nicholson also submitted to me that she would have been qualified to receive Newstart during the period that she was receiving Austudy when she had no entitlement to Austudy, and she included that as well as the question of financial hardship, and she said she was facing difficulties [in] that she doesn’t drive and she doesn’t have a computer.  In relation to the matters where I’ve said I’ve accepted her evidence, in my view, the difficulty with the neighbours and the complaint about the job service provider, whilst stressful for her, … were not such to constitute special circumstances given that she had plenty of opportunity … to notify Centrelink in the appropriate manner that she was receiving Austudy payments when she had previously – quite some considerable time beforehand – … [withdrawn] or discontinued both those courses.

So, I don’t believe that [these situations] either, separately – that is the dispute with the neighbours, and the complaint against the job service provider – or collectively would constitute special circumstances.  I also take into account the financial circumstances that have been submitted by Ms Nicholson.  After payment of rent, she has $322 a fortnight.  Whilst I accepted that [it] may be difficult for her to survive, I don’t believe it’s unusual or uncommon in comparison with other social security recipients, so I don’t consider that, either on its own or collectively, to be special circumstances, and in terms of whether she would have been qualified to receive Newstart, the reality is that she didn’t – she says she has been applying for jobs, but I’m not satisfied that during the relevant period, she was doing things that she would have done under an activity test for Newstart, and I’ve already said … that Centrelink doesn’t automatically put somebody onto Newstart after they have been on Austudy without them going through the normal processes. 

So, I’m not satisfied that she did satisfy the activity test for Newstart during that period, and as a consequence of all those matters – despite her difficulties, her financial situation and things that might have been happening in her personal life:  she referred to not having much contact with her children anymore – I don’t believe that they had such an adverse effect on her that she was unable to comply with the requirements to notify Centrelink or any of her other requirements under the Act, and indeed, she did contact Centrelink several times, but in my view, as I’ve already said, she didn’t fulfil her obligations, and similarly, I’ve taken into account my finding earlier that she must have received at least some of the letters from Centrelink, and so, the lack of a working letterbox, to me, does not add to or constitute special circumstances during the relevant period. 

For those reasons, I find that the criteria for waiving the debt under section 1237AAD of the Act do not apply, in that special circumstances have not been made out in … [this] case. Accordingly, I find that the debt should not be waived or written off, and

I affirm the decision under review. 

… 

END OF EXTRACT