Ruan and Anor; Secretary, Department of Employment and Workplace Relations

[2006] AATA 1132

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 1132

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No S2006/87 & S2006/88

GENERAL ADMINISTRATIVE DIVISION		)
Re		SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS

Applicant

And GAGE RUAN AND LI XIN CUI

Respondent

DECISION

Tribunal Senior Member L Hastwell

Date18 May 2006

PlaceAdelaide

Decision The Tribunal grants the stay of the decision of the Social Security Appeals Tribunal made on 9 March 2006.

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

L HASTWELL
  (Senior Member)

CATCHWORDS

SOCIAL SECURITY – applications for stay of decision of SSAT – likelihood of success of application for review – possible error of law by SSAT – hardship compounded if weekly payments continue and review successful – prospects of recovery of debt poor if success on review – gambling activity not relevant to consideration of hardship – stay granted

Social Security Act 1991

Administrative Appeals Tribunal Act 1975 s 41(2)

Secretary, Department of Social Security v McLaughlin 81 FCR 35
Re Delkou and Repatriation Commission (1985) 8 ALD 454

REASONS FOR DECISION

18 May 2006   Senior Member L Hastwell  

1.      I have before me two applications for a stay of orders in the matters of Ruan (S2006/87) and Cui (S2006/88).  The respondents to the applications for a stay are husband and wife.  I heard both matters together.

2.      Mr Prince appeared for the applicant (the Department) and Mr Guthrie for the respondents.  The respondents chose not to give any evidence.  Some documents were tendered by consent and where relevant will be referred to.

3.      The Department applies for the stay of a decision of the Social Security Appeals Tribunal  (the SSAT) dated 9 March 2006 which found that there was not a debt owed by either Mr Ruan or Ms Cui to the Department and that the respondents were entitled to ongoing payments of allowances by the Department, being a Parenting Allowance in the case of Mr Ruan and a Newstart Allowance in the case of Ms Cui.

4.      The Department has applied to the Administrative Appeals Tribunal (AAT) for a review of the substantive SSAT decision and has applied to stay the SSAT orders pending that review being heard.

5.      The applicant argues that there is a clear error of law in the SSAT decision and that the prospects of success upon the substantive application for review are very good.  The applicant points to the difficulty that they will have in recovering money from the respondents if the Department is successful.  The prior debts dealt with in the SSAT decision would be re-instated and those debts amounted to $22,168.94 for Mr Ruan and $22,189.92 for Ms Cui.

6.      The applicant says that a decision not to grant the stay may also cause further hardship for the respondents in that ongoing payments of allowances will potentially increase the debt that they would then have to repay.  Based on the financial information provided thus far by the respondents, the prospects of the Department being repaid these sums is not good if the Department is successful on the review.

7.      The applicant referred to the case of Secretary, Department of Social Security v McLaughlin 81 FCR 35 as being the key authority with respect to the definition of “income”. This case was not referred to by the SSAT. The issue to be determined in this matter is not about the amount of monies received by the respondents, but rather whether those monies amounted to income for the purposes of the Social Security Act 1991 (the Act).  The money in question was gambling winnings of Mr Ruan.  The issue is whether or not that was income.

8.      The applicant pointed to the fact that the respondents still show $15,000 in a bank account at the commencement of May 2006 (Exhibit R3), and that if one looked realistically at their expenses as being in the realm of $700-$800 a week they could still manage for some months without falling into significant hardship.  It was submitted that they are currently not in financial hardship.

9.      The respondents allege potential hardship if not paid their entitlements pending a hearing.  They relied on a number of exhibits which included a vendor’s settlement statement showing that they had sold their home in March 2006, and from the net sale proceeds of $135,895.73 they have allegedly repaid large sums of money to several people to whom they owed funds.  Exhibit R3 shows that $25,000 was withdrawn on 4 April 2006, and $60,000 on the same date, $5,000 on 20 April 2006 and a further $30,000 on 21 April 2006.  This reduced their funds in the bank to $15,620.36. 

10.     No corroboration of the repayment of debts was produced. 

11.     The respondents also relied on a letter that had been sent to the Tribunal which was accepted as Exhibit R4.  It alleged monthly credit card interest liabilities that are not sustainable on the information provided. 

12.     The Tribunal was assured by both the applicant and the respondents that this matter could be ready for hearing fairly promptly and they anticipated that it would be a one day matter.  The only evidence to be called is that of the respondents.  The main focus of the hearing will be legal argument.

13.     The respondents submitted that the law was not as black and white as indicated by the applicant and that his client had some prospect of success on the appeal.

14.     The matter of Re Delkou and Repatriation Commission (1985) 8 ALD 454, outlines the criteria that must be considered by the Tribunal when considering an application for a stay under s 41(2) of the Administrative Appeals Tribunal Act 1975.  The test as to whether to make a stay order is whether it is “desirable to do so”.  The outcome of a stay must be tested against the interests of all persons who might be affected by the review, which in this case is the Department, the two respondents and their child or children.

15.     In Re Delkou (supra) the Tribunal identified three principal factors for consideration:

·hardship, which a party to the review may suffer by reason of the grant or refusal of a stay;

·the likelihood of recovery by the Commonwealth of monies to be paid under the determination sought to be stayed; and

·the prospect of success of the application for review.

16.     On the basis of the material provided thus far, the Tribunal is satisfied that there is little prospect of recovery by the Department if the Department is successful upon review.  The debt that would thereby become owed by the respondents would be compounded by every weekly payment made to them from the date of the SSAT decision onwards. 

17.     The applicant submits that there is a good prospect of the application for review being successful based on McLaughlin’s case (supra), a binding authority on this Tribunal.  The Tribunal is not obliged to explore the substantive issue at this hearing, but it will involve legal argument.

18.     Mr Ruan and Ms Cui may need to be cautious with their funds between now and the date of the hearing.  The Tribunal does not consider that it is appropriate to take into account the extent of Mr Ruan’s gambling activities in considering whether the current $16,000 will support them for the next 2-3 months while the matter proceeds to a hearing. 

19.     On balance, and considering the interests of all relevant parties, the Tribunal is satisfied that the stay should be granted in this case until such time as the matter proceeds to a review. 

20.     The Tribunal is mindful of the limited funds at the respondents’ disposal.  The Tribunal will direct the Registry to ensure that this matter is given an expedited hearing within three months of this date.  The respondents’ funds should last them for at least that period of time based on the expenditure set out in their letter (Exhibit R4). 

I certify that the 20 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member L Hastwell

Signed:         ............J Coulthard........................................
  Associate

Date of Hearing  18 May 2006
Date of Decision  18 May 2006
Counsel for the Applicant         Mr R Prince
Solicitor for the Applicant          AGS
Counsel for the Respondent     Mr E Guthrie
Solicitor for the Respondent     Nicholls Gervasi