Petrykowski and Secretary Department of Employment and Workplace Relations

[2005] AATA 1142

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 1142

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2004/1648

GENERAL ADMINISTRATIVE  DIVISION		)
Re		GEORGE PETRYKOWSKI

Applicant

And SECRETARY DEPARTMENT  OF EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Ms N Bell, Senior Member

Date18 November 2005

PlaceSydney

Decision The decision under review is set aside and instead the Tribunal decides that recovery of the amount of the
debt outstanding as at the date of this decision should be waived.

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

Ms N Bell
  Senior Member

SOCIAL SECURITY – Overpayment – Newstart Allowance – Waiver of Debt Requested – Psychiatric and Physical Conditions – Applicant Did Not Knowingly Fail to Comply – Current Outstanding Debt Waived

Social Security Act 1991

Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435

REASONS FOR DECISION

18 November 2005 Ms N Bell, Senior Member 

1.      Mr Petrykowski received newstart allowance from 25 August 2000 to 9 September 2002, when he began to receive disability support pension.  On 18 March 2004 Centrelink conducted a data matching exercise that showed Mr Petrykowski had been receiving a fortnightly superannuation pension from Comsuper since 1997.  In April 2004 a Centrelink delegate of the Respondent raised a debt of overpayment of newstart allowance in the sum of $20,137.04.

2. Mr Petrykowski agrees that he was overpaid by this amount and agrees that it is a debt due by him to the Commonwealth. However, he contends it should not be recovered. He bases this contention on section 1237AAD of the Social Security Act (1991), which allows for waiver of a debt if there are special circumstances, other than financial hardship alone, that make it desirable to waive.  Mr Petrykowski considers his circumstances including his psychiatric and physical conditions, his financial circumstances and his dealings with Centrelink are special.

3. However, section 1237AAD also requires, before the discretion to waive can be exercised, that the person did not knowingly make a false statement or representation and did not knowingly fail to comply with a provision of the Act.

4.      The Respondent contends that Mr Petrykowski knowingly made a false representation by not advising Centrelink of his Comsuper pension payments and that his circumstances are not special anyway.  Mr Petrykowski agrees that he did not advise Centrelink of his Comsuper income, but he contends that his psychiatric condition and other circumstances prevented him from comprehending his obligations under the Act.

5.      Therefore, I must decide whether, in failing to advise Centrelink of his Comsuper income, Mr Petrykowski knowingly make a false representation.  If I decide that he did not do so knowingly, I must decide whether his circumstances are special so as to make it desirable to waive the debt.

did mr petrykowski  knowingly make a false representation?

6.      I note, at the outset, that, in Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435, Deputy President Forgie held that the word “knowingly” refers to actual knowledge to be ascertained by reference to the statements of the person as to the person’s actual state of knowledge  at the time and to events surrounding the relevant act.

7.      Mr Petrykowski’s evidence was very vague and disjointed.  At times he appeared to “drift off”, either falling asleep or simply becoming distracted.  Occasionally, he appeared to focus well on the questions he was being asked but would then retreat again into vagueness.  At other times he appeared very distressed.  He required frequent, short adjournments.

8.      Mr Petrykowski’s evidence was that he arrived in Australia in 1974 and first worked for Channel 7 as a cinematographer, then for Fairfax as a photojournalist and then for the Australian Film, Television and Radio School where he lectured and tutored in cinematography.  He was retrenched from there in 1997.  From 1997 to 1999 he did some work on a Review Panel for the University of New South Wales and some consultancy work.  In 1999 he began to receive a pension from Comsuper of approximately $320 per week.  He applied for numerous jobs but was unsuccessful.  I note he has degrees from Italy and Poland.

9.      He approached Centrelink in December 2000 at the suggestion of his general practitioner, Dr Gaynor, who had diagnosed him with acute depression.  He had never dealt with Centrelink before and had never heard of newstart allowance.  When shown copies of the forms lodged by him he said the writing was not his and said that on each occasion he lodged a form it was completed by a Centrelink officer.  Whenever he lodged another form, the officer would simply ask him whether anything had changed.  Because nothing had changed, he would say so and then be told by the officer to just tick the boxes.

10.     At the time he claimed newstart allowance he believed he was entitled to receive it, having been advised by his doctor to apply and Centrelink having told him he was eligible.  He thought newstart allowance and his Comsuper payments were separate things, in that his Comsuper payments were from his private savings or contributions over the years.  He never thought they had to be declared by him.

11.     He has no memory of getting letters from Centrelink asking him if his income had increased to more than 1cent.

12.     Mr Petrykowski said he has problems with his back following an injury at work, heart problems, severe shortness of breath and some deafness.  He said he is unable to read newspapers or books because he can’t concentrate or comprehend properly.

13.     Much was made by the Respondent of Mr Petrykowski’s passport being in the name of “Dragomir” instead of “George”.  Mr Petrykowski explained this as due to his defection from Poland and advice he received to conceal his identity from the Polish authorities.  He feared he would be arrested if he returned and was identified.  He said he offered to show Centrelink his passport but the officer did not want to see it.  He was never asked if he goes under a different name.  He also has a driver’s licence in the name of Dragomir because he thought he may need to use his licence to hire a car in Poland.  He does not have a car and did not have one in 2000.

14.     DIMIA records show that Mr Petrykowski travelled overseas in 2000, 2001 and 2004.  Mr Petrykowski travelled to Poland in 2000 to look at the nursing and other care available for his mother there.  His mother had a heart problem and Parkinson’s disease and had suffered an accident.  She died in 2002.  When Mr Petrykowski was asked how he managed to fill in the departure forms he was required to complete at the airport, he said he sometimes had help filling them in and sometimes he would help someone else to fill them in.

15.     The Respondent also made much of the existence of a Commonwealth Bank account (in addition to his Westpac account) that Mr Petrykowski had not told Centrelink about.  Mr Petrykowski said the officer he spoke to did not ask him whether he had another account – he just asked which account he would like his allowance paid into.

16.     Dr Anthony Dinnen, Consultant Psychiatrist, in a report dated 20 September 2004, considered Mr Petrykowski presented at examination with profound depressive illness which he thought was as severe at that time as it was in 2000 when Mr Petrykowski first claimed newstart allowance.  He found Mr Petrykowski to exhibit “classic psychomotor retardation”.  Dr Dinnen considered Mr Petrykowski did not have the capacity in 2000 to understand the implications of his claim at that time.  He suspected that Centrelink officers had helped him to complete the claim without first establishing whether he had alternative sources of income.  Dr Dinnen found Mr Petrykowski’s ability to communicate was so poor that a layman would have great difficulty establishing information.  Dr Dinnen considered Mr Petrykowski was prevented by his condition from knowingly making a false declaration or failing to comply with a provision of the Act.  He considered Mr Petrykowski required hospitalisation.

17.     Dr Dinnen also canvassed the opinions of Drs Gaynor, Allen, Epstein, Lele and Rallings together with that of Dr Hutchison of Health Services Australia.  All those doctors commented on Mr Petrykowski’s significant or severe depression. 

18.     In a further report dated 17 March 2005, following re-examination of Mr Petrykowski, Dr Dinnen reported no change in Mr Petrykowski’s condition.  He concluded that  Mr Petrykowski has a profound depressive illness extending back for several years, not responsive to treatment and not able to have treatment forced upon it, and because of the psychotic element of his condition he is not capable of forming proper judgements  or making good decisions.

19.     In oral evidence to the Tribunal, Dr Dinnen said he is now treating Mr Petrykowski and has established an anti-depressant medication treatment regime.  If there is no improvement in Mr Petrykowski’s condition he will attempt to have him admitted to hospital for treatment including electro convulsive therapy.  His prognosis was of continued severe chronic depressive illness with no return to his previous level of functioning.  Dr Dinnen said this condition affects a person’s understanding and judgement, creating a plasticity and withdrawn, passive obedience.  He stressed that the vegetative features exhibited by Mr Petrykowski indicate a profound biological condition that goes far beyond a reactive depression.  He said Mr Petrykowski is as ill as anyone with this condition he has ever seen.

20.     In relation to the completion of a newstart allowance claim form, Dr Dinnen said the appropriate completion of such a long and complex form would require a person to have full control of his faculties.  Mr Petrykowski’s passivity, he said, made it possible that he would simply tick every box on the form.

21.     When asked whether Mr Petrykowski had “turned a blind eye” to his responsibility to complete the form correctly, Dr Dinnen said that the “blind eye” was his depressive illness, that is, his condition made him blind to what he was doing.

22.     I am mindful that Mr Petrykowski undertook some overseas travel in 2000 and 2001 and completed some departure forms, sometimes with assistance.   He opened a bank account.  He attempted to make arrangements for the care of his mother in Poland.  However, while these activities indicate some level of functioning, I do not consider they displace the expert opinion of Dr Dinnen, whose evidence is the only psychiatric expert evidence available to me.  I consider that Dr Dinnen’s evidence is consistent with the comments and opinions of non specialist medical practitioners, including Drs Gaynor; Allen; Epstein; Lele; Rallings and Hutchinson, about Mr Petrykowski’s condition at or before 2000 and following.  I do, however, think that the assessment of Dr Hutchison of Health Services Australia, underestimated the functional impairment produced by Mr Petrykowski’s psychiatric condition.  Dr Hutchison is not a psychiatrist.  I prefer Dr Dinnen’s evidence because of his specialist qualifications and experience and because he is now Mr Petrykowski’s treating psychiatrist.

23.     I do not consider Mr Petrykowski’s use of another name on his passport or his driver’s licence indicates anything underhanded or an attempt to avoid scrutiny in Australia.  Similarly, his failure to inform Centrelink of the existence of a bank account into which his superannuation pension is paid is of little significance.  I accept his explanation that, because he was not specifically asked about it, he did not speak of it.

24.     On the basis of Mr Petrykowski’s evidence and the evidence of Dr Dinnen I consider that Mr Petrykowski’s judgement and ability to comprehend his circumstances and his obligations was so impaired by his profound depressive illness that he did not knowingly make false representations to Centrelink during the relevant period.  As to whether he was reckless or, perhaps, recklessly indifferent to whether he was making a false representation, he must first have had an appreciation that disclosure of his superannuation income was required of him.  I do not consider that he was capable of having such an appreciation.  I do not consider he had “actual knowledge”.

25.     On the same basis, I do not consider Mr Petrykowski was capable of reading and understanding the import of the notification letters sent to him by Centrelink.  His failure to comply with the requirements of the Act or to discharge his obligations under the Act was therefore not a “knowing” act or omission.

are mr petrykowski’s circumstances special?

26.     Mr Petrykowski currently lives in the garage level of his former matrimonial home.  The space he occupies is self-contained but very small.  His former partner lives in the house above.  He sees her approximately once per week.  The house is in both their names but he does not wish to sell because he does not want any troubles or expense and has no need to sell anyway.  He pays $50.00 per week by way of “rent” to his wife, $260.00 per quarter in maintenance levy and half of the quarterly council and water rates.  He has a debt of some $5,000.00 to Citibank and repays that at $100.00 per month.  His superannuation pension is approximately $320.00 per week.  Although he was granted disability support pension in September 2002, and is entitled to a part payment taking into account his superannuation pension, the entirety of his disability support pension is applied by Centrelink to the repayment of his newstart allowance debt.

27.     Mr Petrykowski’s disability support pension was granted in respect of his depression and his back condition.  I note, however, that he also complains of “heart problems”, severe shortness of breath (see referral for lung investigation, suggesting interstitial lung disease or asbestosis – (Exhibit A3)) and severe - profound bilateral mixed hearing loss ( Exhibit A4).

28.     I note that on 6 March 2001, Centrelink received a Treating Doctor’s Report prepared by Dr Gaynor describing Mr Petrykowski’s depression, bilateral sacro-iliac strain and lumbar disc prolapse and bilateral inguinal hernias.  Dr Allen’s report of 5 December 2000, also indicates acute anxiety/depression.  Dr Dinnen’s evidence was that Mr Petrykowski, at the time of the grant of newstart allowance, was profoundly depressed and, had he been assessed at that time under the Impairment Tables in Schedule 1B to the Act, would have attracted an impairment rating of 30 points.  Counsel for Mr Petrykowski submitted that, had Mr Petrykowski been directed by Centrelink officers to the appropriate payment, that is, disability support pension, he would have incurred a smaller debt given the more generous treatment of income in assessing the rate of pension.

29.     Dr Dinnen also gave evidence of the effect on Mr Petrykowski of concerns about his indebtedness to Centrelink.  He said that when a person suffers from severe depression everything takes on a malignant tone and financial pressures increase because of feelings of hopelessness.  That worry, in turn, aggravates the illness.  Dr Dinnen said Mr Petrykowski is worried he is going to be sent to goal.  Waiver of the debt would, according to Dr Dinnen, alleviate that worry.

30.     I am mindful that it is not unusual for a person in receipt of disability support pension to suffer ill health nor is it unusual for a person in receipt of income support to be subject to difficult financial circumstances.  These circumstances alone would not make Mr Petrykowski’s circumstances special.  However, I agree with Dr Dinnen that Mr Petrykowski is one of a group of people, including those with schizophrenia, low average intellect and emotional disturbance, who appear to “fall between the cracks” and for whom the necessarily complex process of claiming benefits is beyond their capacity.  It is clear that Mr Petrykowski required and obtained the assistance of Centrelink officers to secure the income support he needed.  However, it is difficult to communicate effectively with Mr Petrykowski.  That difficulty, together with his failure to comprehend the significance of his superannuation pension, stood in the way of the appropriate assessment of both the rate and type of income support to be paid to him.  It was these unusual factors that gave rise to the debt and in this respect his circumstances are special.  His financial, physical and psychiatric circumstances underline the special character of his circumstances as a whole. 

conclusion

31. On the basis that Mr Petrykowski’s circumstances are special within the meaning of section 1237AAD of the Act, and given my conclusion that he did not knowingly make a false representation or knowingly fail to comply with a provision of the Act, I consider it desirable to exercise the discretion to waive recovery. I note, for completeness, that it is not appropriate to write off the debt given the scope for recovery from withholdings from Mr Petrykowski’s part payment of disability support pension.

32.     I accept the expert opinion of Dr Dinnen as to the aggravating effect of this indebtedness on Mr Petrykowski’s serious psychiatric condition.  However, I am also mindful that for some two years he had the benefit of payments to which he was not entitled.   A balancing of these considerations leads me to conclude that I should waive only the current outstanding balance of the debt.  That would alleviate Mr Petrykowski’s concern about his indebtedness, increase his income to include the disability support pension currently being withheld and leave in place his repayment of the debt so far.

decision

33.     The decision under review is set aside and instead the Tribunal decides that recovery of the amount of the debt outstanding as at the date of this decision should be waived.

I certify that the 33 preceding paragraphs are a true copy of the reasons for the decision herein of Ms N Bell, Senior Member

Signed:         ........[Linda Blue].......................
  Associate

Date of Hearing  29 September 2005
Date of Decision  18 November 2005
Counsel for the Applicant         Mr David Carroll
Solicitor for the Applicant          Legal Aid Commission
Solicitor for the Respondent     Centrelink, Legal Services