Rofail and Secretary, Department of Social Services (Social services second review)
[2022] AATA 2317
•21 July 2022
Rofail and Secretary, Department of Social Services (Social services second review) [2022] AATA 2317 (21 July 2022)
Division:GENERAL DIVISION
File Number(s):2020/3442
Re:Margret Rofail
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
DECISION
Tribunal:Member Dr C Huntly
Date:21 July 2022
Place:Perth
The Reviewable Decision, being the AAT1 Decision, dated 7 September 2020, is set aside and substituted with the decision that:
(a)the ARO decision of 10 December 2019 is set aside and remitted to the Agency, with the direction that the overpayment debt be recalculated, to reflect the revised debt period; and
(b)the revised overpayment debt be recovered by way of an instalment arrangement.
.............[Sgd]...........................................................
Member Dr C Huntly
CATCHWORDS
SOCIAL SECURITY – disability support pension – Applicant received disability support pension overpayment – Agency raised overpayment debt – determining reasons for overpayment debt – quantum of overpayment debt – whether overpayment debt period is correct – whether overpayment debt is repayable – whether overpayment debt can be written off – whether overpayment debt can be waived – consideration of special circumstances – Applicant found not to meet eligibility requirements – overpayment debt recalculation required – Reviewable Decision set aside and remitted
LEGISLATION
Social Security Act 1991 (Cth)
Social Security (Administration) Act 1999 (Cth)
CASES
Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9
Beadle v Director-General of Social Security (1985) 60 ALR
Boscolo v Secretary, Department of Social Security (1999) 90 FCR 531
Brookes and Secretary, Agency of Education, Employment and Workplace Relations [2008] AATA 501
Davy and Secretary, Department of Employment and Workplace Relations (2007) 94 ALD 693
Douglas and Secretary, Agency of Families, Community Services and Indigenous Affairs and Anor [2007] AATA 1072
Dranichnikov v Centrelink (2003) 75 ALD 134
Feneley and Secretary, Department of Family and Community Services [2003] AATA 496
Gerhardt and Secretary, Department of Employment, Education and Training [1996] AATA 173
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Klaverstyn and Secretary, Department of Family and Community Services [2003] AATA 71.
Minister for Community Services and Health v Chee Keong Thoo (1988) 8 AAR 245
Mirza and Secretary, Department of Families, Community Services and Indigenous Affairs [2007] AATA 1309
Re Lumsden and Secretary Department of Social Security [1986] AATA
Re Tabije and Secretary, Agency of Social Services [2014] AATA 786
Rosser and Secretary, Agency of Families, Housing, Community Services and Indigenous Affairs [2009] AATA 47
Secretary, Agency of Families, Housing, Community Services and Indigenous Affairs and Walsh [2008] AATA 75
Secretary, Department of Family and Community Services and Birgden [2003] AATA 67
Secretary, Department of Family & Community Services v Sekhon (2003) 73 ALD 41
Secretary of the Department of Families, Housing, Community Services and Indigenous Affairs v Jones (2012) 89 ATR 267
Secretary, Department of Social Security v Hales (1998) 82 FCR 154
Secretary, Department of Social Security v Hodgson (1992) 37 FCR 32
Secretary, Department of Social Security v Hulls (1991) 22 ALD 570
Secretary, Department of Social Security v Smith (1991) 13 AAR 454
Trimboli v Secretary, Department of Social Security (1989) 86 ALR 64
Ward and Secretary, Department of Family and Community Services [2000] AATA 212
Waqar and Secretary, Department of Social Services [2020] AATA 1493
SECONDARY MATERIALS
Department of Social Services, ‘Guides to Social Policy Law’ Social Security Guide (online guide version 1.295, 1 July 2022) chapters 4, 5 and 6 < FOR DECISION
Member Dr C Huntly
21 July 2022
INTRODUCTION
The decision under review (Reviewable Decision) is the decision of the Administrative Appeals Tribunal, Social Services & Child Support Division (AAT1) which affirmed the decision made by the Respondent’s delegate, an Authorised Review Officer (ARO).
The ARO determined that Mrs Rofail (Applicant) had a Disability Support Pension (DSP) debt of $39,608.78 for the period 1 July 2012 to 30 June 2017 (claimed debt period).DECISION IN SUMMARY
Mrs Rofail has been entitled to a DSP since 1 March 2012. The Respondent agency, Services Australia (Agency) claims that Mrs Rofail was overpaid her DSP during the claimed debt period. This, it is claimed, was because the actual earnings of Mrs Rofail’s spouse for the same period were not correctly reported to the Agency by Mrs Rofail.
Mrs Rofail claims that she did report her spouse’s actual earnings as required during the claimed debt period.
On 12 September 2019, the Agency decided to raise a DSP debt for the amount that it claims that Mrs Rofail was overpaid ($31,555.24) (First Decision). Mrs Rofail requested a review of the First Decision. On 10 December 2019, following a review of the First Decision, the ARO decided to increase the debt amount to $39,608.78 (Second Decision).
Mrs Rofail began an instalment plan to repay the debt amount indicated in the Second Decision and also applied to AAT1 for a review of the Second Decision. At this point, Mrs Rofail’s repayments were paused. At the time of the present review, the outstanding debt amount raised against the applicant by the Agency is $39,285.22 (outstanding debt amount).
The questions before the Tribunal are:
(a)whether there is a DSP debt and, if so,
(b)what the quantum of that debt is.
Further, if there is a DSP debt, are there reasons why any or all of that DSP debt should be waived or written off?
FACTS
The Applicant has been in receipt of DSP since 23 July 2010. Her entitlement to the DSP is not in issue between the parties.
On 14 March 2012, the Agency sent the Applicant a letter requiring her to advise the Agency of any changes relevant to her and her spouse’s income.[1] Relevantly, this letter also stated the Applicant’s rate of payment of the DSP that the Applicant was being paid.[2]
[1]T11/118-124.
[2]T11/120.
The letter then set out, in clear summary terms, the assets on which the Applicant’s rate of payment was calculated.[3] This summary listed:
(a)Two bank accounts (one of which is attributed to the Applicant at 50%, the other at 100%);
(b)Household effects and two motor vehicles (each attributed to the Applicant at 50%);
(c)One residential house lot (attributed to the Applicant at 50%);
(d)No business interests; and,
(e)A “combined taxable income” (advised for the purposes of the Family Tax Benefit) for income year 2011/2012 of $39,634.
[3]T11/121-122.
The letter also stated, inter alia, that “You need to let us know if any of these details change to ensure you are receiving your correct entitlement.” The letter contains the following alert: “Note: Centrelink may only disclose personal information to the person the information is about. Any financial investments or property that your partner wholly owns will not appear on your Centrelink Statement.”
On 25 August 2017, the Applicant provided the Agency with the following:
(a)a Business Details Form (MOD F);[4]
(b)her spouse’s tax return for the years 2015-2016 which showed an adjustable taxable income of $40,260;[5]
(c)Financial Statements from ‘Good Price Garage Doors’ for year ending 30 June 2016;[6] and
(d)a quarterly Business Activity Statement for the quarter 1 April 2017 to 30 June 2017.[7]
[4]T25/256.
[5]T26/265-275.
[6]T27/310-318.
[7]T26/276-277.
On the same date, the Applicant also provided the Agency with her spouse’s tax returns recording the following adjustable taxable income:[8]
(a)2014-2015 – $36,718
(b)2016-2017 – $45,147
(c)2015-2016 – $40,260
[8]T26/264-310.
On 24 May 2018, the Applicant provided the Agency with an “Income and Assets Form” (MOD IA).[9]
[9]T31/326-339.
On 22 June 2018, the Agency sent a request for information to the Applicant asking for copies of her spouse’s personal tax returns for financial years 2015/2016 and 2016/2017.[10]
[10]T34/344; noting this was potentially redundant, given the prior provision of this material by the Applicant.
On 27 June 2019, the Agency sent the Applicant a request for information seeking copies of her spouse’s “payslips for the period 01 July 2002 to June 2019”.[11] This date range was peculiar, given that the claimed debt period is 1 July 2012 to 30 June 2017.
[11]T34/344.
On 4 July 2019, the Applicant provided the Agency with her spouse’s tax returns for the 2012-2013 and 2013-2014 financial years showing the following adjustable taxable income:[12]
(a)2012-2013 – $29,787
(b)2013-2014 – $39,063
[12]T38/356-366.
On 6 September 2019, the Applicant provided a copy of her spouse’s Notice of Amended Income Tax Assessments for the year ended 30 June 2010 and the year ended 30 June 2017[13] together with his tax return for the 2018-2019 financial year and the financial statements for ‘Good Price Garage Doors’ for year ending 30 June 2018.
[13]T39/368-384.
The Amended Income Tax Assessments stated the Applicant’s spouse’s taxable income for the relevant financial years as:
(a)2009-2010 – $25,870
(b)2016-2017 – $49,984
(c)2018-2019 – $32,860
On 12 September 2019, the Agency made the First Decision to raise and recover a DSP debt in the amount of $31,555.24 for the claimed debt period.[14]
[14]T40/405-407.
On 23 September 2019, the Applicant sought review of the First Decision.[15]
[15]T50/602.
On 10 December 2019, an ARO made the Second Decision which increased the Applicant’s DSP debt to $39,608.78.[16] The Second Decision took account of the Applicant’s spouse’s tax return for 2014, something that had not been taken into account in the calculations made under the First Decision.
[16]T42/414-420.
On 7 February 2020, the Applicant sought review of the Second Decision by the AAT1.[17] On 6 May 2020, the AAT1 affirmed the decision under review.[18]
[17]T45/426-433.
[18]T2/9-18.
On 7 June 2020, the Applicant sought review in the General Division of the Administrative Appeals Tribunal (Tribunal).[19]
[19]T1/1-8.
The outstanding debt amount at the date of the submissions is $39,285.22.[20]
[20]See above [4].
ISSUES
The issues to be determined in this application are:
(a)the details of the actual debt period (if any);
(b)whether there was an overpayment of DSP during the debt period;
(c)whether the overpayment is a debt to the Commonwealth; and, if so
(d)if the debt should be recovered.
LEGISLATION AND POLICY
The relevant law relating to DSP is contained in the Social Security Act 1991 (the Act) and the Social Security (Administration) Act 1999 (the Administration Act). The relevant policy is contained in the Guide to Social Security Law (the Guide),[21] which ought to be applied unless there are cogent reasons for departing from it.[22]
[21]Department of Social Services, ‘Guides to Social Policy Law’ Social Security Guide, version 1.295.
[22]Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634.
Calculation of the rate of DSP
There is no dispute that the Applicant was qualified for DSP during the claimed debt period, under s 94 of the Social Security Act 1991 (Cth) (the Act). Section 117 of the Act provides that a person’s rate of DSP is calculated using Pension Rate Calculator A at the end of s 1064 of the Act.
Module A of s 1064 of the Act provides a Method Statement for calculating the rate of DSP. Pursuant to the rate calculator, a number of factors will affect the rate payable to a person. The calculation relevantly requires the Agency to assess a person under an income test and an asset test, and determine the rate of payment in accordance with the test that produces the lower rate.
Module E of s 1064 of the Act provides the income test. The income test in Module E requires the ordinary income of a person to be worked out on a yearly basis. Depending on the amount of ordinary income, an income reduction may apply, which reduces the maximum rate of DSP. Further, the income of a person who is a member of a couple is assessed by combining the couple’s ordinary individual incomes (on a yearly basis) and dividing by two.[23]
[23]Section 1064-E2
The term “ordinary income” is defined in subsection 8(1) of the Act:
…
ordinary income means income that is not maintenance income or an exempt lump sum.
(Original emphasis).
The term “income” is defined at s 8(1)(a) of the Act:
income, in relation to a person, means:
(a) an income amount earned, derived or received by the person for the person's own use or benefit
…
(Original emphasis).
Section 1072 of the Act states:
A reference in this Act to a person's ordinary income for a period is a reference to the person's gross ordinary income from all sources for the period calculated without any reduction, other than a reduction under Division 1A.[24]
[24]The Respondent notes that Division 1A is not relevant to this application at para 25 of the SFIC.
Obligation to notify the Agency of change of circumstances
The general requirement to inform the Agency of a change of circumstances is set out in s 66A of the Administration Act, which relevantly requires a person in receipt of DSP to notify the Agency within 14 days of an event or change of circumstances which might affect the payment of a social security payment, which relevantly in this case includes DSP.
Subsection 68(2) of the Administration Act allows the Agency to issue a notice (information notice) to a person in receipt of DSP requiring them to inform the Agency of a change in circumstances which might affect the payment of DSP. Section 69 of the Administration Act allows the Agency to issue such a notice to a person who has received DSP.
Subsection 100(1) of the Administration Act relevantly provides that if a person receiving a DSP is given such a notice, and the recipient fails to comply with this obligation and the event or change in circumstances results in a reduction of the pension rate, then the DSP becomes payable to the recipient at the reduced rate on the day the event or change of circumstances occurs.
The Respondent contends that the Applicant failed to notify the Agency of changes to her income, specifically her spouse’s income, in accordance with her obligations under ss 66A and 100(1) of the Administration Act during the period 1 July 2012 to 30 June 2017.
The Respondent also contends that the Applicant did not notify the Agency of her spouse’s income until she provided his tax returns on 25 August 2017, which was after the claimed debt period.
The Applicant contends that notification of her spouse’s income did occur episodically in compliance with s 66A of the Administration Act during the claimed debt period.[25]
[25]Email from Applicant 10 September 2021.
WAS THE APPLICANT OVERPAID DSP?
Subparagraph 123(3)(b) of the Administration Act states that a determination regarding the rate of a social security payment continues in effect until the payment becomes payable at a lower rate under ss 98, 99 or 100.
Subsection 1223(1) of the Act states if:
(a) social security payment is made; and
(b)a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit;
the amount of the payment is a debt due to the Commonwealth
The Respondent contends that the Applicant failed to correctly declare her spouse’s income as required by section 68(2) of the Administration Act. As a result, it is contended that the Applicant’s rate of DSP was calculated on an incorrect basis, resulting in payments in excess of her actual entitlement, during the claimed debt period.
By reference to the Agency’s debt calculator, the Centrelink Debt Calculator (MultiCal), the Respondent contends that the Applicant was overpaid $39,608.78 during the claimed debt period 1 July 2012 to 30 June 2017.[26]
[26]T49/504-518.
The Applicant questions the basis upon which the Agency has calculated the claimed overpayment of DSP and the duration of any actual claimed debt period.
It is agreed between the parties that the Applicant provided the required application documentation in August 2010 relevant to her DSP application, including relevant financial disclosures.[27] It is further agreed between the parties that the Applicant was notified of her entitlement to and rate of “Centrelink Payment for Disability Support Payment”,[28] along with the basis of calculation (being a combination of DSP and Pension Supplement) by letter dated 14 March 2012 (March 2012 Letter).[29] This letter, under the heading “Rate of Payment” contains the parenthetical statement: “Note that all the information in this statement is from records we hold as at the issue date of this statement.”
[27]T6-T10.
[28]T11/120.
[29]T11.
The March 2012 Letter stipulated that the Applicant’s DSP “is currently being paid under the income test”.[30] Relevantly, under “Income and Asset Details” this letter identifies no income sources, however, it does refer at this place to unstated amounts that may be assessed at a “deemed rate”.[31]
[30]T11/120.
[31]T11/121.
The March 2012 Letter also contains the following information under “Other Details”:[32]
Family Tax Benefit estimate
Date last updated Amount advised For financial year
(combined taxable income)
1 Jul 2011 $39,634 pa 2011/2012
[32]T11/122.
The March 2012 Letter then relevantly states that “You must tell us if you and/or your partner”:[33]
[33]T11/123.
Employment
…
·have any change to your income from employment (the amount you earn goes up or down).
…
Income, Assets and Investments
…
·get any money from ANY other source
Accordingly, it would be open to a fair minded third person, reading the foregoing correspondence together with the materials before the Tribunal to form the inference that the Agency had notice of an annual combined income amount for the Applicant and her spouse of $39,634 (advised combined income amount), advised by the Applicant, from 14 March 2012. Such an individual would, thereafter, be aware of an ongoing obligation to notify the Agency of changes to their income from that date, by reference to this advised combined income amount.[34]
[34]Noting the requirement at s 123(3)(b) of the Administration Act (alluded to above), that “a determination regarding the rate of a social security payment continues in effect until the payment becomes payable at a lower rate.”
It would likewise be open to a fair minded third person, reading the foregoing correspondence together with the materials before the Tribunal, to form the inference that the rate of payment of DSP advised by the Agency in the letter had been calculated by reference to the advised combined income amount of $39,634 identified in the March 2012 Letter.[35]
[35]Kambouris and Secretary, Department of Education, Employment and Workplace Relations [2008] AATA 221 at [25]-[32]; George and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2011] AATA 91 at [36]; Rezaei and Secretary, Department of Social Services [2020] AATA 109 at [21].
It follows, therefore, that any overpayment of DSP for the claimed debt period should be calculated by comparing:
(a)the MultiCal combined income amount; with
(b)the advised combined income amount.
and determining if any such variation would result in an overpayment of DSP.
The Tribunal questioned the Respondent about the methodology used by MultiCal in calculating the relevant income amounts for the Applicant’s spouse, given that he was a self-employed contractor throughout the combined debt period for whom revised Income Tax assessments had been issued over time.
The Tribunal notes the helpful submissions made by the Respondent on this point in their additional further submissions of 28 February 2022 as follows:
3.26 Rather, the income in question is income the Applicant’s partner derived from a business as a sole trader. This requires consideration of section 1075 of the Act.
3.27 Section 1075 relevantly provides that a person’s ordinary income from a business they carry on is to be reduced by losses and outgoings that are allowable deductions for the purposes of section 8-1 of the Income Tax Assessment Act 1997.
3.28 The application of section 1075 is explained in paragraph 4.7.1.20 of the Guide, which relevantly states:
Income from a sole trader or partnership business is the net amount:
AFTER allowable expenses for the cost of running the business, AND
BEFORE income tax and other personal deductions.
For assessment purposes the current annual rate of income is used, generally based on the most recent income tax return. To calculate the effect of income on fortnightly payments, the annual rate should be divided into 26 equal instalments and then treated as ordinary income in each fortnight.
3.29 Paragraph 4.7.1.30 of the Guide explains what ‘allowable expenses’ are for this purpose. It relevantly states:
SSAct section 1075(1) allows the ordinary income of a business for income test purposes, to be reduced by the amount of certain deductions which are allowable for taxation purposes. However, the deductions MUST:
• relate to the business, AND
• be allowable under the relevant sections of the Income Tax Assessment Act 1997.
3.30 Expenses are further described in the following terms:
ONLY expenses directly relating to the normal operation of the business and which are allowable under SSAct section 1075. That is, expenses:
incurred while earning taxable income, OR
necessary for the conduct of a business with the purpose of earning taxable income.
Example: Legal expenses to the extent that they are incurred in the course of producing income or in carrying on a business for that purpose and are neither of a capital, private or domestic nature. 7
3.31 As noted in paragraph 3.93.9 above, Secretary has applied section 1075 of the Act in identifying the net business income of the Applicant’s partner during each of the relevant financial years. The Secretary submits that, in light of the above, section 1075 is the applicable section for calculating the ordinary income of the Applicant’s partner (and therefore, the Applicant).
The Tribunal accepts the Respondent’s submissions on this point and finds that the Agency has correctly applied s 1075 of the Act (in lieu of s 1072 identified above) when calculating the relevant “income” applicable to the Applicant’s spouse, for each of the years falling within the claimed debt period, for the purposes of the MultiCal combined income amount calculations that appear in the following table.
In tabular form, the variances between the advised combined income amount and the subsequent MultiCal combined income amount (from which the ARO decision was derived)[36] for each of the years of the claimed debt period are as follows:
[36]T49/481.
Financial Year
MultiCal combined income amount
Advised combined income amount
Variance
2012/13
29,963
39,634
-9,670
2013/14
39,338
39,634
-296
2014/15
37,208
39,634
-2,426
2015/16
41,196
39,634
1,563
2016/17
58,377
39,634
18,743
The foregoing considerations suggest that, for those years in which the MultiCal combined income amount was less than the advised income amount, no debt would fall for inclusion, pursuant to s 1223(1) of the Act.[37]
[37]2012/13; 2013/14; 2014/15. Once again noting the requirement at s 123(3)(b) of the Administration Act (alluded to above), that “a determination regarding the rate of a social security payment continues in effect until the payment becomes payable at a lower rate.”
On the other hand, for those years in which the MultiCal combined income amount was greater than the advised income amount, a debt due to the Commonwealth would arise pursuant to s 1223(1) of the Act. Presumably, the amount of any such debt would be calculated as the difference between the DSP that the Applicant was actually paid for the relevant period and that which should have been paid (if the greater MultiCal combined income amount had been notified to the Agency by the Applicant).
By reference to the evidence before the Tribunal discussed above, no debt would arise by operation of s 1223 of the Act with respect to the Applicant’s DSP payments prior to financial year 2015/16. Accordingly, the revised debt period as determined by the Tribunal is 1 July 2015 to 30 June 2017 (revised debt period). For the foregoing reasons, the Tribunal finds that the Applicant was overpaid DSP for the revised debt period.
IS THE OVERPAYMENT A DEBT TO THE COMMONWEALTH?
The amount of overpayment claimed by the Respondent and challenged by the Applicant was calculated using the MultiCal. According to the Respondent, the MultiCal suggests that the Applicant was overpaid during the claimed debt period.[38] The Agency relies on the MultiCal as being an accurate calculation of the Applicant’s DSP debt.
[38]T49/504-518.
The Respondent further contends the total amount of the payments made to the Applicant during the relevant periods in excess of her actual entitlement (being $39,608.78 during the claimed debt period) is a debt due to the Commonwealth pursuant to s 1223(1) of the Act.
There is a lack of clarity in Respondent submissions about how this quantum of overpayment has been calculated, particularly with respect to important underlying assumptions. Further and better particulars about the calculation methodology adopted by the Agency were sought by Directions dated 1 December 2021. The further submissions in response to those directions were provided on 28 February 2022.
The necessary underlying calculation assumptions behind the quantum of the claimed overpayment remain unclear, beyond re-asserting the Applicant’s failure to report and the Respondent’s contentions regarding the appropriate debt period. This may be due to the formulation of the Tribunal’s questions, however, there is still an absence of information that would assist the Tribunal in fully understanding the Respondent’s basis of calculation.
Accordingly, the Tribunal must rely on the materials before it at the time of decision.
Given the evidence discussed above, the Tribunal finds that the amount of the debt for each financial year should be calculated by reference to the difference between the MultiCal combined income amount and the advised combined income amount shown in the Table above for each of the financial years 2015/16 and 2016/17.
Having found that there has been an overpayment of DSP to the Applicant, as discussed above, the quantum of that debt should be calculated as the difference between the DSP that the Applicant was actually paid for the revised debt period, and that which would have been paid for that period, had the Applicant notified the Agency of the correct combined income amount as required under the Act to enable the Agency to accurately apply the MultiCal process for the debt period.
It follows that, while the Tribunal accepts the Respondent’s contention that the total amount of the payments made to the Applicant during the relevant periods in excess of her actual entitlement is the correct formulation of the debt, the Tribunal does not accept the correctness of the Respondent’s submissions as to either the claimed debt period, or the actual quantum of the debt due to the Commonwealth, pursuant to subsection 1223(1) of the Act.
A recalculation of the quantum of the overpayment debt (revised overpayment debt) is, therefore, required.
SHOULD THE REVISED OVERPAYMENT DEBT BE RECOVERED?
Part 5.4 of Chapter 5 of the Act allows for debts to the Commonwealth to be written off or waived for a period in certain circumstances.
In Secretary, Department of Social Security v Hales (1998) 82 FCR 154, 155 (Hales) French J (as he then was) noted that the taxpayer expects the repayment of social security benefits received by a person if they were not entitled to them:
From time to time in the administration of social security benefits overpayments occur. Sometimes these are the result of innocent non-compliance with the requirements of the law which can be affected by the stress associated with the circumstances that led to the receipt of benefits in the first place. The taxpayer is entitled to expect that in the ordinary course money paid to people which they are not entitled to receive will be recovered, albeit in a way appropriate to the circumstances which led to the overpayment and the circumstances of the persons concerned. However, the confining of a recovery regime by rigid rules, particularly in this area of the law, is likely to be productive of unfair or harsh outcomes in some of the great variety of fact situations that can arise. There are provisions in the Act which recognise that reality. They relate to the writing off and the waiver of debts otherwise due to the Commonwealth.
(Emphasis added).
However, as his Honour identified in the above passage, to prevent hardship the Act balances the requirement to repay an overpayment debt with the possibility that the debt may be waived or written off in certain circumstances. The Tribunal will now consider whether any of these circumstances apply to the Applicant.
Write off
Section 1236(1) of the Act
Subsection 1236(1) of the Act provides:
(1)Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.
Subsection 1236(1A) of the Act sets out the circumstances where the Secretary may decide to write off the debt under s 1236(1). It provides:
(1A) The Secretary may decide to write off a debt under subsection (1) if, and only
if:
(a) the debt is irrecoverable at law; or
(b) the debtor has no capacity to repay the debt; or
(c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
(d)it is not cost effective for the Commonwealth to take action to recover the debt.
If a debt is written off, recovery of the debt is put on hold for a set period of time. The debt still exists and may be recovered later.
Subsection 1236(1B) of the Act sets out the instances where a debt is irrecoverable at law, whilst s 1236(1C) of the Act relevantly provides that if a debt is recoverable by means of deductions from a social security payment, the person is taken to have capacity to repay the debt unless recovery would cause “severe financial hardship”.
The meaning of ‘severe financial hardship’ has been considered in a number of Tribunal decisions, including Re Lumsden and Secretary Department of Social Security [1986] AATA 228; Secretary, Department of Family and Community Services and Birgden [2003] AATA 67 and Klaverstyn and Secretary, Department of Family and Community Services [2003] AATA 71.
In Feneley and Secretary, Department of Family and Community Services [2003] AATA 496, the Tribunal stated:
Severe financial hardship is not defined in the Act. However, the meaning of the term, while not implying destitution goes beyond straightened financial circumstances and imports a need for the particular circumstances of a person to include suffering of a severe or extreme nature.
In Douglas and Secretary, Agency of Families, Community Services and Indigenous Affairs and Anor [2007] AATA 1072 the Tribunal stated:
As to severe financial hardship, I accept that Mr Douglas is on the disability support pension and has little, if any, assets. He has high medical expenses and must use taxis extensively because of his condition. He has provided most generously for his daughter. He gave evidence that he owes his father $10,000 which he pays back at the rate of $100 per fortnight. I do not consider that have to repay the debt to Centrelink at their current rate of $15 per fortnight would result in severe financial hardship.
The Respondent contends that the Applicant has the capacity to repay the debt, noting that it can be repaid via deductions from her current social security payments.
The Applicant provided a Statement of Financial Circumstances on 17 March 2020 which did not disclose the bank accounts held by the Applicant;[39] it is unclear as to whether the Applicant does not hold any bank accounts, or whether the details were simply not disclosed. There is also a noticeable lack of information contained in this statement, relating to the Applicant’s spouse’s income from all sources, apart from an investment property in Melbourne.
[39]T47/437-440.
The Respondent’s contentions relating to the incompleteness of the Statement of Financial Circumstances are not responded to by any of the Applicant’s submissions. Accordingly, an inference may reasonably be drawn from the absence of any response that the Applicant does not dispute the Respondent’s contentions in this respect.
The Respondent contends that:
the Applicant is currently in receipt of DSP of $620.12 per fortnight and has a 50% share of a rental property with her spouse;
(b)The Applicant’s debt is currently being recovered via a withholding of $50 per fortnight from her DSP; and
(c)There is no evidence that these repayments are causing her financial hardship.[40]
[40]R3/[46].
Contrary to this submission of the Respondent, the Applicant contends that the $50 per fortnight withholding repayments are causing her financial hardship. In the Applicant’s first response to the Applicant’s SFIC, her representative stated as follows on the Applicant’s behalf:[41]
7. It states that it is inappropriate to write off the debt due to the whereabouts of Margret been known [sic] and because it is cost effective for the commonwealth to take action to recover debt but it hasn’t taken into account the third aspecting [sic] of written off a debt the fact that this will cause severe financial hardship for Margret and her family especially during this covid-19 period as Margret uses most of her DSP income to pay for medications that are essential to her everyday life.
8. Margret did not agree to these deductions she was simply felt like this is compulsory [sic] and had no other choice and has also asked the agency to put these deductions on hold has it has become very difficult to maintain as her payment is not $620.12 per fortnight as the agency has stated it is in fact $438.52 per fortnight
[41]A1.
At the hearing, the Applicant made the further observation that:
They used to take $100 from my payments I was a pensioner and in the financial hardship. I did request them to take only $50. Then after that, I did request them to stop the payments, you know, because I had no money to pay. I was in real hardship.[42]
[42]Transcript p 29 [25].
While the Tribunal accepts that the Applicant may be inconvenienced by the withholding arrangement in a manner that she believes to amount to hardship, as discussed above, the hardship requirement at s 1236(1C) of the Act must amount to “severe financial hardship”. The evidence before the Tribunal does not support a finding of severe financial hardship within the terms described in the Act in this case. Accordingly, the Applicant has some capacity to repay the revised overpayment debt for the purposes of s 1236(1A) of the Act.
Further, the Tribunal finds that the revised overpayment debt is recoverable at law because, as stated above, the overpayment is a legally recoverable debt to the Commonwealth.
None of the preconditions for a write-off of the revised overpayment debt (at 1236(1A) of the Act) are made out by the Applicant in this case.
Accordingly, the Tribunal finds that the revised overpayment debt cannot be written off under s 1236(1) of the Act.
Waiver for sole administrative error
Section 1237A(1) of the Act
Subsection 1237A(1) of the Act provides that the Secretary must waive a debt if that debt is attributable to the “sole administrative error” of the Commonwealth (in this case the Agency):
(1)Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
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).
In Gerhardt and Secretary, Department of Employment, Education and Training (Gerhardt),[43] Deputy President Forgie stated that “solely” in the context of a debt being attributable solely to the Commonwealth’s administrative error should be given its “ordinary meaning”. Deputy President Forgie stated, at [40]:
Applying those ordinary meanings to the sub-section mean that the Secretary must waive the right to recover the proportion of the debt that is attributable only to the Commonwealth’s administrative error. The Secretary’s duty to waive does not extend to those debts which are attributable to errors or other factors which are independent of the Commonwealth’s administrative error. It makes no difference that those other errors or factors are minor. If those other errors or factors follow as a result of the Commonwealth’s administrative error (i.e. they are incidental to the Commonwealth’s error), then it may be that the debt is attributable solely to the Commonwealth’s administrative error. Whether it is or is not attributable in that situation to the Commonwealth’s administrative error will be a question of fact.
(Emphasis added.)
[43][1996] AATA 173 [39]–[40].
In Secretary, Department of Family & Community Services v Sekhon,[44] Wilcox J explained that:
However, it seems to me, the tribunal failed to consider the significance of the inclusion, in s 1237A(1), of the word “solely”. For the subsection to have effect, the “proportion” of the debt — in this case, it is common ground, that would be the whole of it — must be “attributable solely” to administrative error. It is not enough that, in the absence of administrative error, the debt would not have arisen. Administrative error must be the sole cause, not merely one of multiple causes.
(Emphasis added.)
[44](2003) 73 ALD 41, 47 [41].
In Ward and Secretary, Department of Family and Community Services Deputy President Forgie referred to her decision in Gerhardt, and clarified the meaning of sole administrative error in the context of s 1237A(1) of the Act:[45]
46.In an unreported decision of Gerhardt and Department Employment, Education and Training (Unreported, AAT 10941, 17 May 1996), I considered the meaning of "solely" as it formerly appeared in s. 289(1) of the Student and Youth Assistance Act 1973. That sub-section was in terms similar to s. 1237A(1) of the Act and a submission had been made that the word "solely" did not mean that the error had been made exclusively by the Commonwealth. After reviewing the authorities, I concluded that the word "solely" meant "exclusively", "only" or "to the exclusion of all else". There is no substantive difference between s. 289(1) of the Student and Youth Assistance Act 1973 and s. 1237A(1) of the Act. Consequently, I have taken the same view in relation to s. 1237A(1).
47.This means that the Secretary’s duty to waive does not extend to those debts which are attributable to errors or other factors which are independent of the Commonwealth’s administrative error. It makes no difference that those other errors or factors are minor. If those other errors or factors follow as a result of the Commonwealth’s administrative error (i.e. they are incidental to the Commonwealth’s error), then it may be that the debt is attributable solely to the Commonwealth’s administrative error.
[45][2000] AATA 212 [46]-[47].
The issues in contention between the parties relate to the Applicant’s responsibility for reporting details of her spouse’s income from employment, business and other sources to the Agency in the manner stipulated by the agency. Multiple, complex, and socially significant questions are raised about the fairness and equity of a disabled, dependent spouse with English as a second language being responsible in such a manner and to such an extent.
The matter before the Tribunal does not permit of a forum to explore or comment on such matters beyond making some gesture of acknowledgement. In a democratic rule of law society, administrative decision makers are bound to act within jurisdiction as provided by statute.
The materials before the Tribunal satisfy it that the Applicant made good faith attempts to notify the Agency of her spouse’s income from employment, business and other sources when that information was made available to her. There is no suggestion that the Applicant acted in anything other than good faith throughout the period in contention.
At the hearing, the representative for the Respondent stated that “The Secretary does accept that the [A]pplicant was providing income estimates for the purposes of her FTB [Family Tax Benefit] payments officially noted in that table at paragraph 60 of our SOFIC.”[46] The Table there referred to discloses that the Applicant reported income of her spouse in connection with her FTB on 10 May 2013 and 29 June 2015.[47]
[46]Transcript p 26 [45].
[47]R3 [60].
It is contended by the Respondent, and not contested by the Applicant that these reporting touchpoints notwithstanding, full reporting of the Applicant’s spouse’s historical income, specifically in the context of the DSP payments, did not begin until 25 August 2017[48] and thereafter.[49]
[48]T26/267, 279 & 297.
[49]T27/313; T39/387; T38/357 & 362; T39/368.
The Applicant submits that her efforts to report her spouse’s income details for all purposes, by means of an annual FTB disclosure are sufficient.[50]
[50]A1; A15; A16 and Transcript at p 20.
However, the Respondent quite correctly referred the Tribunal to relevant prior Tribunal commentary relating to the reporting requirements for applicants such as the Applicant in the present matter, who are in receipt of multiple benefits as follows:
62. In Re Tabije and Secretary, Agency of Social Services [2014] AATA 786, it was found that,
“The general run of decisions from relevant cases is that advising Centrelink of income for FTB purposes does not equate to providing Centrelink with income information for other purposes. In cases such as Rosser and Secretary, Agency of Families, Housing, Community Services and Indigenous Affairs [2009] AATA 47 and Secretary, Agency of Families, Community Services and Indigenous Affairs and George [2007] AATA 1456 the Tribunal has decided that advice to Centrelink for FTB purposes did not meet a recipient’s obligations for responding to notices under social security law. Where the Tribunal has decided otherwise, in cases such as Secretary, Agency of Families, Housing, Community Services and Indigenous Affairs and Walsh [2008] AATA 75, it is because in those cases the recipient made a significant and conscientious effort to keep Centrelink informed.”
63. In Brookes and Secretary, Agency of Education, Employment and Workplace Relations [2008] AATA 501, it was found that “there is no legislative obligation on Centrelink to be pro-active in applying data about FTB income to a person’s other benefits.”
64. In Waqar and Secretary, Department of Social Services [2020] AATA 1493, it was found that, “
“The test for whether a debt is due solely to administrative error is not against the standard of administration contended by the respondent that is for the department to co-relate all information for a couple between different types of payments. Nor is it one that requires the department to correct for the respondent’s failure to report as she was instructed.”
While the Tribunal is not bound by these prior decisions, the positions put by the Tribunal as constituted in those cases are, nevertheless, highly persuasive. It is clear enough from the materials referred to above that the Applicant did not meet the requirement to provide timely advice to the Agency about her spouse’s income details for all purposes specifically in the context of her DSP throughout the relevant period.
Accordingly, the Applicant is unable to establish her contention that the revised overpayment debt is due to “sole administrative error” pursuant to s 1237A(1). This contention in support of waiver of the debt must, therefore, fail.
Waiver for special circumstances
Section 1237AAD of the Act
It remains for the Tribunal to determine if there is sufficient basis for finding that the revised overpayment debt should be waived due to “special circumstances”.
Section 1237AAD of the Act provides that a debt can be waived by the Secretary if there are special circumstances. The section states:
The Secretary may waive the right to recover all or part of a debt if the Secretary is
satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii)failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and
(b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c) it is more appropriate to waive than to write off the debt or part of the debt.
(Notes omitted).
In summary, s 1237AAD of the Act gives the Secretary the discretion to waive a debt if there are special circumstances, other than financial hardship alone, which make it appropriate to do so. Additionally, the person must not have contributed to the debt by making a false statement, representation or by otherwise failing to comply with a provision of the Act or the Administration Act.
There are numerous submissions from the Applicant which include detailed medical reports regarding her qualifying disability status, needs and challenges.[51] These are noted. However, there are no submissions from the Applicant specifically addressing the special circumstances discretion at s 1237AAD of the Act above.
[51]A2-A15.
Waiver for special circumstances is discretionary
To determine “special circumstances” under s 1237AAD of the Act, the question of whether or not it is appropriate or desirable to waive the debt must be addressed to the specific circumstances of every case. This was explained by French J in Hales at 162:
The section [s 1237AAD] confers upon the Secretary a discretion to waive the right to recover all or part of a debt. That discretion is only enlivened when the Secretary is satisfied that the three conditions specified in pars (a), (b) and (c) of the section are met. It does not follow that the Secretary is then obliged to waive the debt. The first condition is negative, the second condition requires consideration of special circumstances that make it “desirable to waive” and the third condition requires the waiver be considered more appropriate than write off. The exercise of the discretion thus enlivened may be informed by other considerations which were not required to support satisfaction of the three necessary conditions.
(Emphasis added.)
It is noted that, in Mirza and Secretary, Department of Families, Community Services and Indigenous Affairs [2007] AATA 1309, Deputy President Jarvis declined to exercise the discretion, despite the statutory conditions being satisfied (at [41]):
In matters of this kind, it is customary for decision-makers to examine all the relevant facts and decide whether the conditions referred to in paragraphs (a), (b) and (c) of s 1237AAD are met, and if so, then to decide whether or not to exercise the discretion conferred by that section to waive the right to recover all or part of the debt. In the present case, however, I find it unnecessary to consider the question of whether the conditions precedent in paras (a), (b) and (c) have been fulfilled,
because even if I were satisfied of those matters, I do not think it appropriate in the circumstances to exercise the discretion conferred on me (standing in the shoes of the Secretary) by s 1237AAD.
(Emphasis added.)
Defining “special circumstances”
The concept of “special circumstances” has been discussed in the case law and in previous Tribunal decisions. The concept must be viewed in the context of the statute providing that if an amount is paid to a person who is not entitled to it, that amount must be recovered. This was explained by Deputy President Forgie in the following passage from Gerhardt at [47]:
The words “special circumstances” have been considered in a number of cases in a number of contexts. These include Beadle v Director-General of Social Security (1985) 60 ALR, Secretary, Department of Social Security v Hulls (1991) 22 ALD 570, Trimboli v Secretary, Department of Social Security (1989) 86 ALR 64 and Secretary, Department of Social Security v Smith (1991) 13 AAR 454. The essence of cases such as these is that a consideration of whether or not there are special circumstances must be undertaken in the context in which the discretion is given.
It is clear from Division 15 of Part 8 of the Act [Student Assistance (Youth Training Allowance) Amendment Act 1994] that the purpose of the provisions is to ensure the recovery of amounts paid under the Act to persons who are not entitled to be paid those amounts. What are special circumstances must be considered against that background. There will be special circumstances if the circumstances are such that it is unreasonable, unjust or inappropriate to recover the amount paid bearing in mind that the provisions are intended to ensure the recovery of amounts incorrectly paid…
As noted by Deputy President Forgie in Gerhardt, the circumstances must be such that “it is unreasonable, unjust or inappropriate to recover the amount”, despite the person having received a payment that they were not entitled to.
In Davy and Secretary, Department of Employment and Workplace Relations (2007) 94 ALD 693 (Davy), at 715-716 [80], Deputy President Forgie similarly referred to the need to consider the applicant’s individual circumstances against the administration of the social security system where other persons who have received payments will have been required to repay them:
The “special circumstances” are not merely directed to the person’s own circumstances. Rather, they are directed to those that are “special circumstances ... that make it desirable to waive”. That necessarily requires a consideration of the person’s individual circumstances but also a consideration of the general administration of the social security system. Waiver of the debt would mean that Mr Davy would have had the benefit of part of his DSP in circumstances in which he was not entitled to it. Certainly, he did not know that his father was giving him his own money but the fact that he was deceived by his father does not mean that it is desirable to waive the debt. He has had the benefit of the money and there is no injustice in requiring him to repay the money of which he has had the benefit but not the entitlement... The system of administration of the SS Act does not visit any injustice for many if not all social security recipients but it did not lead to any injustice or unfairness on Mr Davy that is not visited, or potentially visited, upon all other recipients of social security payments under the Act. Therefore, I am not satisfied that there are special circumstances that make it desirable to waive the debt under s 1237AAD of the Act.
The case law and Tribunal decisions also refer to the difficulty in precisely defining “special circumstances”. However, a common observation is that special circumstances will be “unusual, uncommon or exceptional”. For example, in Beadle and Director-General of Social Security (1984) 6 ALD 1 (Beadle), 3 the Tribunal stated:
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 upon 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.
In Groth v Secretary, Department of Social Security (1995) 40 ALD 541 (Groth), 545 Kiefel J (as she then was) explained that special circumstances would be such as to distinguish an applicant’s situation from “the usual or ordinary case”:
The phrase “special circumstances”, it has been said, although imprecise is sufficiently understood not to require judicial gloss: Beadle’s case... and for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth’s case from others, to take it out of the usual or ordinary case. That was, I consider, the only enquiry to be undertaken in this case. It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary…
In Hales, at 162, French J also commented on the need for a flexible definition and the need to carefully consider the individual facts of each case:
The evident purpose of s 1237AAD is to enable a flexible response to the wide range of situations which could give rise to hardship or unfairness in the event of a rigid application of a requirement for recovery of debt. It is inappropriate to constrain that flexibility by imposing a narrow or artificial construction upon the words. It may be that there will be few cases in which the Secretary will be satisfied that there are special circumstances in the absence of financial hardship. It may be that there are few cases in which having found special circumstances to exist, the Secretary would exercise the discretion to waive in the absence of financial hardship. But to anticipate the limits of the categories of possible cases by imposing on the language of the section a fetter upon its application which is not mandated by its words, is to erode its useful purpose.
In Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9 (Angelakos), 17-18 [33] Besanko J also emphasised the importance of flexibility when identifying special circumstances. Besanko J referred to the circumstances having to be “unusual or uncommon” (rather than “exceptional”) to distinguish the case from the ordinary or usual:
I also note that the authorities have emphasised time and again the importance of maintaining flexibility in determining what constitutes special circumstances. The danger is that the test will be overstated if the word “exceptional” is emphasised. It was not the intention of parliament to confine the exercise of the discretion to an exceptional case. There is less risk of overstatement if the words “unusual” or “uncommon” are emphasised. Those words indicate, correctly in my view, the fact that there must be something that distinguishes the case from the ordinary or usual case. It may not be easy to postulate the ordinary or usual case other than in quite general terms and, in doing so, close attention must be given to the particular statutory context.
In Boscolo v Secretary, Department of Social Security (1999) 90 FCR 531 (Boscolo), 536 [18], French J stated that special circumstances required “something unusual or different”:
The core of the requirement for “special circumstances” or “special reasons” is that there be something unusual or different to take the matter the subject of the discretion out of the ordinary course: Minister for Community Services and Health v Chee Keong Thoo (1988) 8 AAR 245 at 261-262; 78 ALR 307 at 324 (Burchett J). But that does not require that the case be extremely unusual, uncommon or exceptional: Secretary, Department of Social Security v Hodgson (1992) 37 FCR 32; 108 ALR 322. In Beadle the Full Court, having concluded that the term “special” was sufficiently well understood not to require a judicial gloss said the matter was one for the decision-maker, in that case the Director-General of Social Security.
(Emphasis added.)
In Dranichnikov v Centrelink (2003) 75 ALD 134 (Dranichnikov), 148 [65-6] the Full Court of the Federal Court referred to the circumstances having to be “exceptional or unusual” such that they “distinguish the case in consideration from the usual case”:
[65]The decision-maker clearly also determined that the circumstances were such that they were not exceptional or unusual so that waiver could not be made as a matter of discretion under s 101. That equates “special circumstances”, as that expression is used in the Administration Act with either exceptional circumstances or unusual circumstances. The origin of the test apparently adopted by the secretary appears to be the decision of the first instance judge in Beadle v Directory-General of Social Security (1985) 7 ALD 670; 60 ALR 225. That was a decision under previous legislation, the history of which is referred to by French J in Secretary of Department of Social Security v Hales (1998) 82 FCR 154; 51 ALD 695; 153 ALR 259. The Full Court in Beadle comprising Bowen CJ, Fisher and Lockhart JJ, however, was of the view that it was not possible to lay down precise rules as to what constituted special circumstances under the then s 102(1)(a) of the Social Security Act 1947 (Cth). Their Honours point out that the question whether there were special circumstances was one for the decision-maker (in that case the Director-General) bearing in mind the purpose for which the power was given. The reference to the first instance decision from which the words “unusual, uncommon or exceptional” come was not actually affirmed by the Full Court.
[66]To some extent the question whether there were special circumstances must depend on how it came about that the error occurred. Again that is not a matter to which the decision-maker apparently averted. Other cases which have considered analogous words such as “special reasons” has tended to conclude, albeit in different contexts, that what is required will be circumstances which distinguish the case in consideration from the usual case. There will be a requirement that the circumstances are such that take the case out of the ordinary: Jess v Scott (1986) 12 FCR 187; 70 ALR 18 and the cases in various contexts in the decision which Lockhart, Shepherd and Burchett JJ discuss.
In Secretary of the Department of Families, Housing, Community Services and Indigenous Affairs v Jones (2012) 89 ATR 267, 274 [51] (Jones) Jacobson J provided a succinct summary of the authorities:
The effect of the authorities is that the phrase “special circumstances”, although lacking in precision, is sufficiently understood as including events or things that render the operation of the statue in a particular case as unfair, unintended or unjust. What is required is something that takes the case out of the ordinary, and unfairness or unintended consequences may show that this exists. Moreover, the circumstances of the case are not confined to matters that are external to the operation of the statutory scheme…
(Emphasis added).
The parties’ submissions regarding special circumstances
As alluded to above, the Respondent contends that the Applicant’s circumstances do not meet the required threshold of “special circumstances” stipulated at s 1237AAD of the Act. After summarising the available medical evidence before the Tribunal, the Respondent’s submissions proceed to suggest that:[52]
73. The Secretary acknowledges that [the Applicant] suffers from several medical conditions, as referenced in these reports. However, the Secretary contends that the Applicant’s circumstances are not sufficiently unusual or uncommon such that it is desirable to waive any part of the debts. While the Applicant has several medical conditions, this is not uncommon or unusual for recipients of DSP. Further, the relative stress and financial strain it places on a person is also not uncommon or unusual.
74. While the Secretary accepts that the Applicant’s present circumstances are by no means straightforward, she is presently in the same situation as many other social security recipients in Australia. In that way, her circumstances cannot be considered “unusual” or “uncommon” and are not distinguishable from the ordinary or usual case. Therefore, the Secretary contends that the special circumstances waiver provision should not be applied in this case.
(Emphasis added.)
[52] R3 p 13
While the Applicant’s submissions assert special circumstances,[53] there is nothing of detail in the Applicant’s submissions that specifically addresses this aspect of either the Respondent’s contentions or the legislative scheme more generally on this point.
[53]A15
The Applicant contends that the medical reports provided in support of her application for review demonstrate that her circumstances are “special” within the contemplation of s 1237AAD of the Act. While the Tribunal acknowledges the severity of the Applicant’s personal circumstances as disclosed in those materials, particularly the overlaying impact of her complex and profound co-morbidities, the Tribunal is persuaded by the submissions of the Respondent to the effect that her circumstances are “not uncommon or unusual for recipients of DSP”.
In adopting this view, the Tribunal finds that the Applicant does not satisfy the threshold requirement for “special circumstances” described in the authorities above.[54]
[54]See, for example: Davy, Beadle, Groth, Angelakos, Boscolo, Dranichnikov and Jones).
Accordingly, it follows that there are not sufficient grounds to exercise the discretion to waive the Applicant’s revised overpayment debt.
CONCLUSION
For the foregoing reasons, the Tribunal has found that there is a revised overpayment debt, which should be calculated as discussed above by reference to the revised debt period.
The Tribunal has considered whether the revised overpayment debt should be written off or waived (as provided by the relevant statutory provisions)[55] and has found that the revised overpayment debt should not be written off or waived, as the Applicant has not demonstrated her eligibility for these alternatives.
[55]Section 1236(1), s 1237A(1) and s 1237AAD.
The Tribunal has further found that the revised overpayment debt is repayable by the Applicant in a manner similar to the instalment arrangement currently in place between the parties.
DECISION
The Reviewable Decision, being the AAT1 Decision, dated 7 September 2020, is set aside and substituted with the decision that:
(a)the ARO decision of 10 December 2019 is set aside and remitted to the Agency, with the direction that the overpayment debt be recalculated, to reflect the revised debt period; and
(b)the revised overpayment debt be recovered by way of an instalment arrangement.
I certify that the preceding 123 (one hundred and twenty-three) paragraphs are a true copy of the reasons for the decision herein of Member Dr C Huntly
...............[Sgd].........................................................
Associate
Dated: 21 July 2022
Date of hearing: 03 August 2021 Representative for the Applicant: Ms R Rofail Representative for the Respondent: Mr K Defranciscis, Lawyer, Services Australia
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