Rendell and Secretary, Department of Family and Community Service S
[2004] AATA 207
•1 March 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 207
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2003/1540
GENERAL ADMINISTRATIVE DIVISION ) Re CHARMAINE RENDELL Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal REAR ADMIRAL A R HORTON AO Date1 March 2004
PlaceSydney
Decision The decision under review is set aside and in substitution thereof the Tribunal decides that the Respondent is to treat so much of the lump sum compensation as not having been made to allow the preclusion period to end on the date of this decision.
[Sgd] REAR ADMIRAL A R HORTON AO
CATCHWORDS
SOCIAL SECURITY – periodic compensation following work place accident – compensation settlement - preclusion period – preclusion from social security payments - sole parent – financial obligations – purchase of property – consideration as to whether medical conditions impacted on decision making capability – solicitor duty of care – special circumstances – decision set aside
Social Security Act 1991 – sections 17(1), 1170, 1173, 1184K
Beadle and Director-General of Social Services (1985) 7 ALD 670
Re Beadle and Director General of Social Security (1984) 6 ALD 1
Secretary, Department of Social Security v Smith (1991) 23 ALD 277
Secretary, Department of Social Security v Thompson (1994) 53 FCR 580
Re Ivovic and Director General of Social Services (1981) 3 ALN N95
Re Green and Secretary, Department of Social Security (1990) 21 ALD 277
Re Secretary, Department of Family and Community Services and Szoke [2001] AATA 353
Re Secretary, Department of Family and Community Services and McMahon [2003] AATA 3
REASONS FOR DECISION
1 March 2004 REAR ADMIRAL A R HORTON AO 1. This is an application to review a decision of the Social Security Appeals Tribunal (“SSAT”) dated 4 September 2003 that affirmed a decision of an Authorised Review Officer (“ARO”) of Centrelink dated 15 July 2003 to preclude a compensation affected social security payment to Ms Charmaine Rendell (“the Applicant”) from 20 January 2003 until 26 March 2006.
2. At a hearing before the Administrative Appeals Tribunal (“the Tribunal”) on 15 January 2004, Ms Rendell was self-represented. Ms J Green, an advocate from the Centrelink Service Recovery Team appeared for the Secretary, Department of Family and Community Services (“the Respondent”).
3. The Tribunal took into evidence the documents provided by the Respondent pursuant to section 37 of the Administrative Appeals Tribunal Act1975 (“the T documents”), and a number of documents listed as exhibits at Attachment A.
BACKGROUND
4. Ms Rendell was born on 6 May 1967 and is a sole parent. On 15 May 2001, whilst in the employment of Mayne Health, she was injured at Port Macquarie Hospital. On 24 February 2003, her compensation claim was settled for a lump sum payment of $200,000. On settlement the Respondent advised that a preclusion period from 20 January 2003 until 26 March 2006 would be imposed, thus precluding Ms Rendell from receiving social security payments (Parenting Payment) during this time.
5. In seeking review of this decision Ms Rendell has variously referred to the failure of the children’s father to provide financial support, that she suffers from financial hardship, that her poor health has affected her decision making ability, and that her solicitor failed to exercise an appropriate duty of care.
6. On 15 July 2003, an ARO decided that the preclusion period was correctly calculated, and that the circumstances of the case were not sufficiently unusual or uncommon for the discretion under section 1184K(1) of the Social Security Act1991 (“the Act”) in respect of special circumstances, to be exercised. This decision was affirmed by the SSAT on 4 September 2003.
EVIDENCE AND FACTS
7. Ms Rendell gave detailed evidence, particularly in respect of dates. At times this was somewhat confusing in the sense that minor issues tended to obscure more significant matters, and in particular, those that had relevance to the question of special circumstances.
Family and Domestic Circumstances
8. Ms Rendell has three children, Patricia Crystal born in 1985, Hugh born in 1988 and Belinda born in 1992. In 1987 Ms Rendell married Mr Hugh Hyde. The family lived with Ms Rendell’s grandmother until 1989 when they moved to a rented home at Banksia. Prior to the birth of Patricia, Ms Rendell was employed as a Grade 2 Operating Theatre Assistant at Royal Prince Alfred Hospital. On moving to Banksia, she returned to the work force, her evidence being that this was against the wishes of her husband.
9. On 10 August 1992, when returning late from a visit to her father at Stroud, Ms Rendell was involved in a car accident when her husband, who was then employed as a truck driver for State Rail, fell asleep at the wheel. He was subsequently charged and convicted of a driving offence. Mrs Rendell and her daughter Patricia were very seriously injured. Her evidence was that on release from hospital, she found it difficult to cope with household chores, initially being wheelchair bound, and at the same time looking after Belinda who was born just prior to the accident. Her evidence was that at around this time she was assaulted by her husband on more than one occasion, and was not allowed to see friends or entertain visitors. However, she considered divorce to be out of the question.
10. Some time later Ms Rendell received a compensation payment of $250,000 gross in respect of her injuries. Exhibit R3 refers to the determination of a preclusion period from 10 August 1992 until 11 February 1996. Ms Rendell stated that she was not aware of that preclusion period, and that may have been the case if she was not in receipt of, or claiming a social security benefit. Her evidence was that she was not receiving any social security benefit, but there is nothing from the Respondent before the Tribunal to assist in this regard.
11. In anticipation of the compensation claim being settled, Ms Rendell bought land at Campbelltown for $98,000, the remainder of the compensation payment, as well as a mortgage for $180,000, being used to build a home. In 1997 Ms Rendell separated from her husband in view of “too much punching and domestic violence going on and the children were starting to be hurt at this stage ”. Following this event, the entire family remained in this home until 1999, when she returned to work in the hospital field. In 1999 she and her husband divorced and she moved with the children to rented accommodation in the Camden area, having sold the property. Her husband initially continued to live in the family home. When the home was sold, which she stated was a fire sale because her husband had taken out a further mortgage unbeknown to her, she was left with $25,000. She stated she was unable to move the furniture out as her husband had “smashed my shoulder”. At this time she understood Mr Hyde was taking drugs, and she was suffering verbal and physical abuse, so she moved, in March 2000, to the Port Macquarie region, obtaining employment as an operating theatre assistant with Mayne Health.
12. Ms Rendell gave evidence that prior to the divorce, the children were taken from her for a period by the Department of Community Services because her husband “had made a statement that I had belted the children which was not the case”. She further told the Tribunal that Mr Hyde had accused her of being on drugs. She told the Tribunal she was not on drugs and that she was having problems with her health, but sought not to take medication.
13. Relevant to the circumstances in her life to this point, was the death of her mother when she was four, when she was “given an overdose of barbiturates” at a hotel. Ms Rendell and her two brothers initially were placed in an orphanage, then separately placed in the custody of various relatives. From her descriptions, there were, and more recently there have continued to be, serious rifts within the wider family.
14. In March 1980, her father, Douglas Rendell, was sentenced to penal servitude for life for the murder of his de facto wife. In July 1989 he was granted an unconditional pardon and three years later, an ex-gratia payment of $100,000 from the New South Wales Government. In December 1994, the Government made a final payment on undisclosed terms. The evidence of Ms Rendell was that she “followed my father for 8 years, three times a week, at Long Bay Gaol.”, a statement that the Tribunal accepts with some reservations, given she was only 13 years of age at the time of the conviction. Nonetheless, the Tribunal concedes this was a dramatic period in her life. After his pardon, her father settled in the Raymond Terrace area, where he seemingly had difficulty in obtaining work and initially in gaining acceptance in the community. In 1999, her brother Douglas, who from the evidence did not get on well with their father, committed suicide.
15. She gave evidence that she established a close relationship with a grandmother (on her ex-husband’s side of the family) living at Port Macquarie, who in her view died in unexplained circumstances in April 2002. From her evidence, it appears she entered the mortuary at the hospital, made the body more presentable, and as a result was interviewed by the police. She stated nothing resulted from this action.
16. She described many occasions of harassment by Mr Hyde after the divorce, both at Campbelltown and then at Port Macquarie, including “stalking the children and scaring them” and claiming to the police that she had committed fraud, was ill-treating the children and was using drugs. She stated that on four occasions she had been falsely arrested as a result of his claims.
17. Ms Rendell referred to her father as having made good friends in his neighbourhood near Clarence Town, but being constantly in fear of being attacked and hurt. The Tribunal was not able to follow the basis of this perceived threat, other than it related to the money he had received from the Government following his pardon.
18. On 16 May 2002, Mr Rendell was found dead on his property. Ms Rendell stated that the autopsy, which she considered should have required her permission, indicated he had been dead for seven days, facial decomposition being evident. In her view, the circumstances, including missing personal property and money, and the evidence in the forensic photographs, were sufficient to justify a full police investigation, and this had not been done. In particular, she seemingly drew heavily on the support of Emeritus Professor Barry Boetcher (Biological Sciences, Newcastle University), who had been instrumental in having the conviction of her father reviewed. Ms Rendell evidenced considerable emotion in giving this evidence, saying at one point “from the age of 11 and ½ to 30 I stood by my father, three days a week”
Compensation
19. The evidence before the Tribunal indicates that Ms Rendell was injured on two occasions whilst employed by Mayne Health. The first instance was on 12 February 2001 when she hurt her back whilst assisting with a lumbar puncture procedure. Whilst she made no claim for compensation, she stated that she advised Centrelink in order to ensure that she would receive some payment should Mayne Health sever her employment. Her aim was to remain working at the hospital. Whilst no compensation claim eventuated from that incident, Centrelink did advise her by letter on 28 February 2001 as to the general rules and procedure in the event of receiving compensation, including the effect it may have on receiving social security payments in the future. Ms Rendell did not deny she had been so advised, but stated that whilst she understood reference to paying back periodic payments in the event of receiving lump sum compensation, she did not understand the preclusion rules. In any event she was not aware of being in any preclusion period. In this instance she was not in a preclusion period as no claim was affected.
20. On 15 May 2001, some three months later, Ms Rendell was injured at the hospital when she slipped and fell on her ”left hip and did my right shoulder separatus muscle…and three discs in my lower back …and in turn incontinence”.. Mayne Health subsequently placed her on light duties, initially in medical records, then in the kitchen and finally in the laundry. On 10 November 2002, Ms Rendell underwent an operation and never returned to work. Payment by Mayne Health ceased on 10 November 2002. On 4 April 2003 her solicitor told her to resign. On 24 February 2003 her claim for compensation was settled, this being for $200,000. At this time Ms Rendell was in receipt of sole parent payment.
21. During the course of negotiation over the claim, a number of matters were impacting on her circumstances; the death of her father and the subsequent granting of probate and the resultant financial considerations, the death of her brother Douglas, and her desire to purchase a property in anticipation of the compensation payment. Whilst she claims that some $550,000 had been removed from her father’s bank account, she and two brothers were to benefit by the conditions of the will. The share to Douglas, who was deceased, was split with her other brother David. She stated that she received $145,000 gross, which reduced to about $95,000 after payment of funeral and legal costs. She used this finance to purchase a four-wheel drive vehicle and furniture, and to redecorate the new home that she was in the process of purchasing.
22. On 16 April 2003, Centrelink advised Ms Rendell that an amount of $2,225.30 sole parent payment had been overpaid and would need to be repaid, the last payment having been made on 10 April. (In the event, it seems that Mayne Health has presently made this repayment). When settlement monies became available, Ms Rendell completed the purchase of a property in Port Macquarie for $332,000 plus associated costs, made up of $149,000 from settlement monies, a $10,000 unsecured loan and the $200,000 bank mortgage. The $50,000 odd residual of the settlement monies went to pay solicitors fees of $38,000 and other debts.
23. Ms Rendell was required to repay the mortgage at $275 per week, this now being $305 a week due to interest rate changes. She gave evidence that she cannot meet this payment, nor her household and living expenses, from her present income, which in the absence of employment, a situation she is seeking to remedy in conjunction with the Commonwealth Rehabilitation Service, consists only of FBT and periodic board from her daughter Patricia Crystal. The Tribunal had before it two Financial Information forms completed for Centrelink by Ms Rendell in April and November 2003 respectively. There is little consistency in the data provided by her, nor is it clear whether costs related to weekly, fortnightly or longer periods.
24. Ms Rendell’s ex-husband last contributed child maintenance in November 2003. The local St Vincent de Paul Society assists Ms Rendell by providing food vouchers and payment for telephone and electricity accounts. She also receives board from her eldest daughter when she stays at Port Macquarie. She has taken the other two children out of a private school, to which she owes back payment of fees, and enrolled them in the local Catholic school. She does not consider the public school system to be suitable. On the day of the hearing her ANZ credit card was cancelled due to debt. To meet her commitments, Ms Rendell sought release of $3600 superannuation benefits on the basis of financial hardship. This was refused by Health Industry Plan on 12 January 2004, as she does not meet the income support requirements.
Preclusion Period
25. Ms Rendell gave evidence that she had no reason to think she was in a preclusion period at the time of the house purchase. Her evidence was that her solicitor, Ms Shannon Dawson of Garrett Walmsley Madgwick Solicitors had failed to ascertain, in accordance with her direction, whether a preclusion period would be implemented. By assisting her in obtaining a loan from the ANZ bank, and by handling the conveyancing of the property purchase, Ms Dawson had led her to believe that there would not be a preclusion period. Hence her understanding was that she would continue to receive “sole parent pension and family allowance”.
26. A letter of 23 April 2003 by Garrett Walmsley Madgwick Solicitors to Ms Rendell, advises that Centrelink had given verbal advice that a preclusion period of 166 weeks would apply. The letter refers to an earlier meeting with Ms Dawson on 19 February 2003 and states in part “you were advised that there may be pay back and a preclusion period in light of your settlement moneys”.. The letter goes on to say that whilst Ms Rendell stated that Centrelink had advised her that there would be no pay-back nor would settlement affect her current Centrelink benefits, she was advised that “regardless of this information, there may be a preclusion and pay back period…”. The letter further states that in a telephone conversation on 22 April 2003, Ms Rendell confirmed that she had received such advice from Ms Dawson, and “regardless …purchased a property …and in fact exchange occurred prior to receipt of the settlement moneys.” Whilst giving this advice, Garrett Walmsley Madgwick were, on the evidence of Ms Rendell, assisting her to obtain a bank mortgage in order to finance the purchase of the property, and acting as the conveyancer. These actions were clearly in conflict with the concerns expressed in respect of a possible, or in the event confirmed, preclusion period.
27. As regards advice to Ms Rendell in respect of the implications should a preclusion period be established, reference has previously been made (paragraph 10) to the earlier preclusion period following the motor vehicle accident, and to the advice provided by Centrelink letter, dated 28 February 2001, after the first injury at Port Macquarie hospital. Ms Rendell recalled seeing the latter, but stated that was why she was insistent that Ms Dawson ascertain the correct information in respect of a preclusion period. On 28 August 2002, Centrelink wrote to Ms Rendell at her home address advising that any compensation payments received in relation to the May 2001 injury and claim might stop her from receiving Centrelink payments in the future. On 17 March 2003, in a statement countersigned by Mr R Williams of the Port Macquarie Centrelink office, Ms Rendell sought review of a “decision on the preclusion that has been placed upon me”.. She agreed in cross-examination that on that date she was informed verbally of the preclusion period. This pre-dates the purchase of the property.
Medical
28. A number of recent psychological and psychiatric reports were before the Tribunal. On 22 July 1999, J Sykes, Clinical Psychologist, notes that Ms Rendell’s condition reflects traumatic and unsettling life events, and her difficulties in coping with family circumstances. In a later report dated 30 March 2000, Ms L Parker, Registered Psychologist, considered Ms Rendell suffered from “severe depression …low self esteem, suicidal tendencies… and poor decision making ability”.. In a report of 4 September 2000, Ms C Forsten, Psychologist, suggests Post Traumatic Stress Disorder, but in a later report of 29 April 2003, she opines that Ms Rendell shows symptoms of Bi-polar Disorder.
29. Dr J Holmes, Psychiatrist, saw Ms Rendell in March 2002. His report refers to numerous medical reports by other doctors, (these not being before the Tribunal), and he diagnosed Adjustment Disorder secondary to her back injuries, particularly in the May 2001 injury. He saw appropriate evidence of distress and anger, but no evidence of disorder of thought or perception.
30. Ms Rendell was also seen by Dr A Byth, Psychiatrist on 3 December 2002. His comprehensive history indicates Ms Rendell was diagnosed with depression in 1995 and was subsequently in receipt of counselling and periodically on medication. He notes that Ms Rendell thought she had Bi-polar Affective Disorder in view of her family history and “occasional overspending on gifts for her children”.. Dr Byth diagnosed Personality Disorder with dependent and borderline personality traits. He did not consider a diagnosis of adjustment disorder warranted, nor did he consider her personality disorder to result from work or work injuries.
31. In April 2003, Dr G Hayward, General Practitioner, reported Ms Rendell to be on medication for depression, this being at the time the property purchase was being actioned. In a later report at Exhibit A3 of 18 November 2003, he refers to “medical issues which have significantly impaired her abilities”. In a further report of 6 January 2004 Exhibit A7, Dr Hayward considered Ms Rendell to be “somewhat more vulnerable” after the death of her father and at the time of resigning from Mayne Health and “managing this may have adversely affected her decision making”. He refers to a forthcoming psychiatric review.
32. On 16 June 2003, Ms F Jackson, Registered Psychologist, carried out a Centrelink Psychologist review. She refers to Ms Rendell’s “long history mental ill health, easily exacerbated by stressful events”, and states “it is evident that Charmaine does suffer from symptoms of quite severe depression…insomnia, …inability to focus or concentrate well, impaired memory, impaired decision making, frequent suicidal ideation and a tendency to be overwhelmed by negative thoughts and problems.”
SUBMISSIONS
33. Ms Rendell accepted during the course of the hearing that she had received written advice from the Respondent that social security payments could be affected in the event of receiving a lump sum compensation period. She also acknowledged that she had been informed verbally of the preclusion period by Centrelink, and had advice from her solicitor that a preclusion period was to be applied, but these were the very reasons that she instructed her solicitor to ascertain the true situation directly from Centrelink. In her view, that had not been done, and as that solicitor was at the time handling her mortgage arrangements and conveyancing, she assumed she could proceed with the property purchase.
34. Her evidence was that she took steps to purchase the property, even before she had the certainty of compensation, to provide safety and security for the children. She considered that to remain in rented property, or indeed to return to rented property, would remove all stability and be a return to the past. When put to her that she now had equity in the property given that she believed its value had increased to $395,000, and a sale and repurchase of a lower value property out of Port Macquarie, or the renting of a property would resolve her financial difficulties, she remained adamant that either option was not viable in terms of the security and future of her family, nor the schooling of the children.
35. The Respondent submitted that whilst the situation of Ms Rendell was difficult, the circumstances did not warrant a lessening of the preclusion period. Ms Green for the Respondent alluded to Centrelink policy that the realisable asset of the home must be taken into consideration, the decision in Re Secretary to the Department ofFamily and Community Services and McMahon [2003] AATA 3 being relevant. The Respondent also submitted that the medical evidence before the Tribunal was insufficient to support a notion of special circumstances, and also indicated there was no impediment to Ms Rendell returning to work.
36. As to the preclusion period, the Respondent submitted that letters to Ms Rendell in February 2002 and August 2002 advised her of the possibility of a preclusion period and that it might affect future social security benefit payments. The letter from the solicitor was further confirmation that Ms Rendell was being made aware of the preclusion issue, and by her own evidence, Ms Rendell was so advised verbally by Centrelink in March 2003. The abovementioned advice and particularly the verbal advice from Centrelink occurred prior to Ms Rendell purchasing the property. Finally, it was submitted that to shorten the preclusion period would frustrate the object of the legislation in the absence of any reasonable circumstances.
LEGISLATION AND DECISION
37. Parenting Payment is a “compensation affected payment “ as defined in s17(1) of the Act and s1169 of the Act states that a person cannot be paid a compensation affected payment during a lump sum preclusion period. A preclusion period following a lump sum compensation payment is calculated in accordance with s1170 of the Act. In this matter, there is no evidence before the Tribunal to suggest that the period has been calculated incorrectly. S1184K of the Act makes provision for the consideration of special circumstances stating:
“1184K(1)For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:
(a) not having been made; or
(b) not liable to be made;
if the Secretary thinks it is appropriate to do so in the special circumstances of the case”.
38. It is clear from the evidence before the Tribunal that Ms Rendell had been adequately forewarned by Centrelink as to the possible implications of receiving a lump sum compensation payment. Indeed it might be suggested that she had been made aware of that situation in 1992 after receiving compensation following the motor vehicle accident, but as earlier noted, the Tribunal makes no finding in the absence of supporting evidence. The statement by Ms Rendell to Centrelink on 17 March 2003 is conclusive evidence that she was made aware of the preclusion period and the implications as to future social security payments.
39. The Tribunal also accepts that Ms Rendell’s solicitor advised her of the possibility of a preclusion period. Her position that she subsequently instructed her solicitor to verify the situation with Centrelink does not materially affect the issue given the advice she herself had received from Centrelink. That her solicitor was prepared to assist her in the purchase of the home, and in obtaining the necessary mortgage facility, whilst being well aware of her financial position, is difficult to comprehend.
40. “Special circumstances” is not defined in the Act but the leading authority in considering the meaning is found in Re Beadle and Director-General of Social Security (1984) 6 ALD 1, wherein Toohey J stated at 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”
41. The Full Court in Beadle v Director-General ofSocial Security (1985) 7 ALD 670, followed this interpretation, also noting in relation to the timeliness of the submission of a claim, “More difficult would be questions of ignorance, illiteracy, isolation, illness and the like. It would depend of the circumstances of the particular case whether these constituted special circumstances.”
42. In Re Ivovic and Director-General of Social Services (1981) 3 ALN N95 the tribunal had identified principles under the then Act which it believed could be applied in determining whether special circumstances existed. The Tribunal considered “special …intended to provide the fullest opportunity to consider the particular circumstances of the case” and whilst hardship is a relevant consideration “regard must be had to the way in which the hardship arose”. In drawing on Re Green and Secretary, Department ofSocial Security (1990) 21 ALD 772, the Respondent referred to factors in Re Ivovic (supra) and considered to be relevant to this matter, they being “there must exist factors which justify the making of an exception in whole or in part to the principle of liability which the Act otherwise establishes” and “the decision maker must have regard to whether, by exercising the discretion in a particular case he/she will be ”achieving or frustrating ends or objects which are comfortable with the scope and purpose of the Social Security Act”.
43. In considering whether the circumstances in this matter might be considered special, and if so, the basis upon which the whole or part of the compensation payment might be reconsidered, the Tribunal reaches the following conclusions:
a. Ms Rendell is suffering financial hardship. She has no residual funds, her obligatory mortgage payment is presently $610 per fortnight, and her outgoings in relation to living costs of herself and her children, as re-calculated by the Respondent, with considerable difficulty during the hearing, could be as high as $750 per fortnight. That is, her present financial commitment each fortnight is about $1360, and this reflects both an inability to understand the implications of financial commitment and to plan accordingly. She also has debts in the order of $13,000. Her only regular income is Family Tax Benefit at $353 per fortnight, but she does also receive $100 per fortnight from Patricia Crystal as board when relevant. In the last year, she has received occasional small deposits to her bank account from her late father’s account, her advice to the Tribunal being that only $1000 is now left in trust. She receives some grace and favour financial assistance (food vouchers and bill payments) from St Vincent de Paul. Her ex-husband ceased providing financial support for the children in late 2003.
b. Ms Rendell has an equity presently in the order of $395,000 in respect of her family home, which if sold for that price, could leave her with some $190,000 less legal fees. She has no other property assets. Her five year old vehicle was purchased second hand for $14,000. There are no figures available to the Tribunal as to the value of furniture and fittings in the home.
c. She has a history of imprudent financial expenditure, seemingly driven in part by the intense desire to establish her own home rather than live in rental property, by the significant disruptions in her married life and thereafter, and by a desire to provide the best life for her children.
d. The evidence is clear that she was made aware, by her solicitor and Centrelink that receipt of a compensation payment could effect her entitlement to social security payments. There is no evidence that she appreciated that a preclusion period had been instigated in 1992 on receipt of compensation following the motor vehicle accident, but she was informed that “a preclusion period had been placed upon me”, and sought a review of that decision vide her statement of 17 March 2003. Such advice predated the purchase of her property.
e. As noted previously, the advice provided by her solicitor as to the implications of the preclusion period was, in the view of the Tribunal and on the evidence of Ms Rendell, negated to a significant degree, considering she was assisted by the solicitor at the same time with the purchase of the property and the obtaining of the necessary mortgage. However, this is a matter between Ms Rendell and her solicitors; she is well aware of the possible cost of taking compensatory action. There is no available evidence as to the detailed circumstances of approval of the mortgage, but from the evidence of Ms Rendell it can be suggested that the ANZ Bank was equally irresponsible in approving such a loan ($200,000) to an unemployed individual with minimal assets, based on the anticipation, and subsequent receipt of, a compensation payment.
g. Ms Rendell has not been employed since resigning from Mayne Health in April 2003. She last worked – before her operation – in November 2002. She has been receiving rehabilitation assistance from the Commonwealth Rehabilitation Service, unsuccessfully applied for a position with council, and intends applying for a position commencing in May 2004. She professed considerable enthusiasm to work, and indeed recounted a past strong work ethic, but she gave no evidence of any attempts to find employment. In this period, medical reports confirm psychiatric conditions. Dr Byth diagnosed personality disorder, which he did not consider arose from work or work related injuries, Dr Hayward identified depression with impaired abilities and that her domestic circumstances “may have adversely affected decision making”. Ms Jackson identified symptoms resulting from a “long history of mental ill health”.. However, none of these reports refer to back problems, the very issue that Ms Rendell suggested affected her most. On balance, the Tribunal is of the opinion that Ms Rendell could physically undertake a return to work.
44. None of the above conclusions can lead to a finding that special circumstances exist such as to modify the existing preclusion situation. In making this observation, the Tribunal does not accord to the view of the Respondent that Ms Rendell’s behaviour should be considered as “reckless” in the context portrayed in Re Secretary, Department of Family and Community Services and Szoke [2001] AATA 353. There are other considerations in the view of the Tribunal, that provide more than sufficient difference, they being in particular family and domestic circumstances, and a more comprehensive overview of health issues.
45. The Tribunal considers these later issues in the light of the more recent Federal Court decisions in Secretary, Department of Social Security v Smith (1991) 23 ALD 277 and Secretary, Department of Social Security v Thompson (1994) 53 FCR 580. In the former, and referring to the predecessor of s1184 as referred to in Re Ivovic (supra), His Honour von Doussa J states:
By its terms the discretion given by s156 may be exercised where the secretary (or a body standing in the place of the secretary on appeal) “considers it appropriate to do so in the special circumstances of the case”. These are wide words intended, as the Tribunal in Ivovic supra pointed out, “to allow the decision maker the fullest opportunity to consider the particular circumstances of each case”
46. In considering an appeal in respect of the manner in which the Tribunal exercised it’s discretion in respect of adjusting a preclusion period, Einfeld J in Thompson (supra) drew on Smith (supra) in agreeing with von Doussa J that the scheme is intended to operate:
“as a fair balance of the interests of the recipient of the payment with the competing interests of others in the community whose needs must be met as far as possible from a finite budget allocation for social security measures”.
He went on to say, in following the views of von Doussa J in Smith (supra) in respect of discretion, as previously quoted, and in respect of the matter before him, that:
“The width of the discretion under the section clearly extends to all the circumstances of the case, including circumstances not specifically related to a particular portion of the compensation payment. It is not therefore outside the section for the tribunal to consider the general factors such as the mental health and social conditioning of the individual in concluding that the preclusion period should be shortened.”
47. In following this reasoning, the Tribunal is of the opinion that notwithstanding the conclusions already reached in respect of Ms Rendell having been given adequate and proper warning of the implications of the compensation payment, considerable weight must be given to the full circumstances of her life as given in evidence and not disputed. Her mother died in her infancy and she was subsequently placed with various relatives, her father was convicted of murder when she was 13 years of age, being pardoned some ten years later after an investigation into the circumstances revealed the death of his de facto wife was accidental. Her evidence was that she was clearly affected over this period, as she was through the difficulties in his subsequent life and in the view of Ms Rendell, in the circumstances of his death and events immediately thereafter. In this later period, her brother committed suicide. Her marriage could only be described, on her evidence and that of various psychologists in particular, as traumatic. The Tribunal can but conclude that this background and those circumstances were indeed unusual and uncommon and may well have influenced her thinking as to her need for “safety and security”.
48. There is also sufficient evidence before the Tribunal to suggest that Ms Rendell suffered depression in recent years and was variously placed on medication. The two psychiatric reports before the Tribunal resulted from single referrals, and diagnosed adjustment disorder secondary to back injuries and personality disorder with personality traits respectively. The reports from clinical and registered psychologists from 1999 generally reflected lengthier observations. , Together with the reports by Dr Hayward, they present a person trying to cope with traumatic and unsettling events of her life (Sykes), severe depression, suicidal tendencies and poor decision making (Parker), post traumatic stress disorder then Bi-Polar disorder (Forsten) and severe depression, inability to concentrate and poor decision making and frequent suicidal ideation (Jackson). In summary, a person coping with life with considerable difficulty.
49. In her report of 29 April 2003, Ms Forsten noted that she had seen Ms Rendell approximately one to two times per month for about 18 months. She records symptoms of Bi-Polar Disorder. In her appearance before the Tribunal, Ms Rendell showed some of the symptoms reflecting Bi-Polar Disorder, namely ‘racing thoughts’, talking fast, jumping from an idea/point to another, unrealistic beliefs and poor judgement, yet guilt, hopelessness and a difficulty in concentration.
50. The Tribunal finds that special circumstances exist in this matter and accordingly determines that a reduction in the preclusion period is warranted. In making this finding, the Tribunal sets aside the decision of the SSAT and substitutes the decision that the Respondent is to treat so much of the lump sum compensation as not having been made to allow the preclusion period to end on the date of this decision. In so doing in that manner, the Tribunal follows the process considered appropriate by Einfeld J in Thompson (supra) at 28.
51. The Tribunal does not follow the reasoning put forward by the Respondent that Re McMahon (supra) should be followed, in respect of the view of that Tribunal as to the appropriateness of a forced property sale, the circumstance being quite different to those in this matter. But the Tribunal nonetheless feels it essential to acknowledge the view of the Respondent that the sale of the family home, undesirable as it may be, and a resort to a smaller property, or a property out of town, or a return to a rental property, is a clear and sensible way to better manage equity. It is essential in the view of the Tribunal, that Ms Rendell fully consider this option, taking professional advice as appropriate.
attachment a
List of Exhibits
A1 Report from Dr R Marshall dated 30 October 2003
A2Letter from Patricia Rendell, daughter of the Applicant dated 17 November 2003
A3 Report from Dr G Hayward dated 18 November 2003
A4Facsimile to the Tribunal from the Respondent dated 24 November 2003 with various attachment including a Centrelink financial information form filled out by the Applicant
A5 Centrelink Receipt dated 18 December 2003
A6 Health Industry Plan letter dated 12 January 2004
A7 Report from Dr Hayward dated 6 January 2004
R1Respondent’s Statement of Facts and Contentions and attachments dated 13 January 2004
R2Letter to the Tribunal from Commonwealth Rehabilitation Service dated 18 December 2003
R3 Compensation Preclusion Period Summary.
I certify that the 51 preceding paragraphs are a true copy of the reasons for the decision herein of REAR ADMIRAL A R HORTON AO
Signed: A. Krilis .......................................................................................
AssociateDate/s of Hearing 15 January 2004
Date of Decision 1 March 2004
Representative for the Applicant Self
Advocate for the Respondent Ms Jane Green
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