Saad v Secretary, Department of Social Services

[2019] AATA 31

Saad and Secretary, Department of Social Services (Social services second review) [2019] AATA 31 (18 January 2019)

Division:GENERAL DIVISION

File Number(s):      2018/7250

Re:Danny Saad

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Chris Puplick AM, Senior Member

Date:18 January 2019

Place:Sydney

The application for an extension of time is refused.

............................[sgd]............................................

Chris Puplick AM, Senior Member

CATCHWORDS

PRACTICE AND PROCEDURE – extension of time – explanation for delay – whether Applicant rested on rights - where prejudice would be incurred by respondent and public by allowing extension of time –merits of substantive application – extension of time refused

LEGISLATION

Administrative Appeals tribunal Act 1975 (Cth)

Social Security Act 1991 (Cth)

CASES

Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541

Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd [1979] 24 ALR 307

Crick and Prosegur Australia Pty Ltd [2016] AATA 313

Hunter Valley Developments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 3 FCR 344

Jamal v Secretary, Department of Social Services [2018] FCA 513

McKenzie and Secretary, Department of Social Security [1998] AATA 841

Re Secretary, Department of Social Security and McAvoy [1996] 44 ALD 721

Secretary, Department of Employment, Education, Training and Youth Affairs v Prince [1997] 50 ALD 186

Swanton v Military Rehabilitation and Compensation Commission [2017] FCA 1142

Re Wendt and Secretary, Department of Social Security [1998] 53 ALD 153

Zizza v Federal Commissioner of Taxation [1999] FCA 37

REASONS FOR DECISION

Chris Puplick AM, Senior Member

18 January 2019

BACKGROUND

1. The basic issues in this application are relatively straightforward.

2. Mr Danny Saad (also known as Joseph Ayoud[1]) (the Applicant) was paid disability support pension (DSP) for two periods of time while he was in custody. People in custodial care are not entitled to receive such payments.[2]

   [1] Mr Saad told the Tribunal that he changed his name by deed poll from Joseph Ayoud to Danny Saad sometime in 1993. It is not clear as under which name the Applicant first received DSP which also commenced in 1993.

   [2] Social Security Act 1991 section 1158.

3. When the Department became aware of the details of these unauthorised payments they took steps to recover the overpayments and raised two sets of debts against the Applicant in the sums of $1,187.21 and $4,414.85.

4. At the hearing on 16 January 2019 the representative appearing for the Secretary informed the Tribunal that the first of the debts had been recovered in full and that in relation to the second debt, partial recovery had been made and the sum outstanding as of the date of hearing was $2,693.73.

5. At the Applicant’s request, the debts raised were reviewed (separately) by an Authorised Review Officer (ARO) of the Department and both were determined to be correct. Centrelink notified the Applicant of the first review outcome on 25 February 2013  the second outcome on 29 November 2014.

6. After release from custody, at which stage the Applicant resumed his eligibility for the DSP (which had first been granted in 1993) he applied for an advanced payment. By decision of the Department on 27 November 2015 (affirmed by an ARO on 4 February 2016) this application was rejected on the basis that the Applicant had debts to the Commonwealth and as such was ineligible for payment.[3]

   [3] Social Security (Administration) Act 1999 section 1061A(3)(c).

7. The Applicant then appealed to this Tribunal’s Social Security and Child Support Division (AAT1) for a review of all three decisions on 7 November 2016. The AAT1 heard the appeal and on the same day, 7 March 2017, dismissed the appeal and affirmed all three decisions.

8. On 11 December 2018 the Applicant appealed to this Tribunal for an extension of time (EOT) in which to lodge an appeal against the decision of the AAT1.

   BASIC PRINCIPLES – EXTENSIONS OF TIME

9. Appeals for extensions of time may be granted by the Tribunal under section 29(7) of the Administrative Appeals tribunal Act 1975 (the Act):

   “.. if the Tribunal is satisfied that it is reasonable in all the circumstances to do so.”

10. In dealing with extension of time applications the Tribunal is mindful of the rationale set out clearly by McHugh J in the High Court case of Brisbane South Regional Health Authority v Taylor[4] indicating why statutory time limits are an important part of the legal process. His Honour noted that:

    First, as time goes by, relevant evidence is likely to be lost. Second, it is oppressive, even “cruel”, to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed. Third, people should be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them.

    The final rationale for limitation periods is that the public interest requires that disputes be settled as quickly as possible.

    [4] Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 at [552]-[553]. Footnotes and citations omitted.

11. His Honour also noted that:

    An applicant for an extension of time who satisfies those conditions [i.e. the conditions laid down in the relevant Act] is entitled to ask the court to exercise its discretion in his or her favour. But the applicant still bears the onus of showing that the justice of the case requires the exercise of the discretion in his or her favour.[5]

    [5] Ibid at [551].

12. It is generally accepted that the “check-list” outlined by Wilcox J in Hunter Valley Developments Pty Ltd and Others v Minister for Home Affairs and Environment[6] may be taken safely as a guide by this Tribunal in determining extension of time applications.

    [6] Hunter Valley Developments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 3 FCR 344.

13. That list provides as follows:

    ·an applicant must show an “acceptable explanation of the delay” and that it is “fair and equitable in the circumstances” to extend time;

    ·a distinction is to be made between an applicant who has “rested on his rights” and allowed the decision-maker to believe that the matter was finally concluded, and one who has continued to make the decision-maker aware that he or she contests the finality of the decision;

    ·any prejudice to the respondent caused by the delay;

    ·whether any  others or the general public would suffer any prejudice as a result of the extension, or established practices be upset;

    ·the merits of the substantial application; and

    ·“considerations of fairness as between the applicant and other persons” in a similar position.

14. Wilcox J did, however, warn that:

    Although the section [s 11 of the Administrative Decisions (Judicial Review) Act] does not, in terms, place any onus of proof upon an applicant for extension, an application has to be made. Special circumstances need not be shown, but the court will not grant the application unless positively satisfied that it is proper so to do. The “prescribed period”….. is not to be ignored.” (Ralkon v Aboriginal Development Commission (1982) 43 ALR 535 at 530). Indeed it is the prima facie rule that proceedings outside that period will not be entertained (Lucic v Nolan (1962) 45 ALR 411 at 416). It is a precondition to the exercise of discretion in his favour that the applicant for extension show an “acceptable; explanation of the delay” and that it is “fair and equitable in the circumstances” to extend time. (Duff v Freijah (1982) 43 ALR 479 at 485; Chapman v Reilly, Neaves J, 9 December 1983, not reported at 7).[7]

    [7] Hunter Valley Developments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 3 FCR 344 at [348].

    LODGEMENT DELAY

15. The reviewable decision of the AAT 1 was made on 7 March 2017.  Tribunal records show that it was despatched to parties on 16 March 2017. Under the provisions of the Act (s 29(2)) the Applicant had 28 days in which to lodge an appeal. This was a period up until 13  April 2017.

16. There is some dispute or uncertainty as to when the Applicant received the copy of the Tribunal’s decision. The Department records show that it received a copy of the decision on 16 March 2017.

17. In his formal application for an extension of time, the Applicant records that he did not receive a copy of the Tribunal’s decision until “12/07/17”.

18. Records at the Tribunal indicate that on 16 March 2017 the Department was sent the AAT 1 decision by email and that on the same date a copy of the decision was posted to the Applicant at an address in  Campsie, NSW. At the hearing the Applicant confirmed that he was still resident at that address in March 2017, although he left it some time in August of that year.

19. However, if the Applicant is given the benefit of the doubt, the 28 day period, if commencing on 12 July 2017 would have expired in 9 August 2017. This application was signed on 7 December 2018 and received on 11 December 2018, that is to say some 16 months late.

20. It should be noted that the Applicant was placed in custody on 4 August 2017 (until 12 November 2018) and so was still living in the community on 12 July 2017.

    APPLICANT’S STATED REASONS FOR DELAY

21. On 7 December 2018 the Applicant completed two documents lodged with the Tribunal on 11 December 2018. In his application for a review of the AAT 1 decision he gives reasons related to his physical and mental health; a claim that the payments were made in error by Centrelink and that his degree of financial hardship is such that the debts in question should be waived.

22. The Tribunal, at this stage is not concerned with a detailed assessment of the merits of this claim. That would be a matter for the substantive merits hearing. However it must (at a later stage) give consideration to the prospects of any such claims being successful.

23. In his application for an extension of time the Applicant states that he was

    “unaware of my legal rights/obligations. It was only after I consulted with my counsel he advised me that I should lodge an appeal. I was held in custody from 4/08/17 to 12/11/18 and unable to press[8] this matter until now. For these reasons advanced allow the application together with new medical material.”

    [8] The handwritten word may be “press’ or “pursue”.

24. It is however important to note the Applicant’s claim that the DSP payments were made as a result of an error on the part of the Respondent (via Centrelink) due to their failure to match the names Danny Saad and Joseph Ayoub as being one and the same person when he was placed in custody. Had this match been made, he claims, then the payments would not have been made in the first place.

25. The medical material referred to by the Applicant will be discussed separately below.

    RESPONDENT’S POSITION

26. The Department opposes the extension of time essentially arguing that it has no prospect of success and that granting it would constitute a prejudice to the Department occasioned by the length of the delay in question. It further asserts that the Applicant would have other avenues of redress to have the debt waived or reduced under the “special circumstances” provisions of s 1237AAD of the Social Security Act.

27. In relation to any claimed administrative error on the part of the Department, the Respondent draws attention to the specific wording of s 1237A of the Social Security Act 1991

28. (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.

29. The critical word here is “solely”. Even if there were an error on the part of the Department, which it denies, in failing to match the names Saad/Ayoub as referring to the same person, the Secretary, validly, makes the following points:

    1.The Applicant failed in to inform the Department of the fact of his incarceration on 26 March 2012 or his incarceration in October 2012, despite the fact that he had been sent numerous notices (at least five) on previous occasions informing him of his duty to do so;[9]

    2.The Applicant used the alias Joseph Ayoub when incarcerated in October 2012, that not being his legal name (although his birth name) and that he had failed at any stage to notify the Department of his use of an alias.

    [9] Amended Secretary’s Outline of Submissions Opposing Extension of Time Application at [50]-[52].

30. For any application to succeed under section 1237A it must be clear that any failure was due solely to the actions of the Department and that if an applicant has taken steps, or failed to take steps, as required, which would have contributed to an error occurring then no case is established. Such actions on the part of applicants may be as minor as leaving a blank space where an answer is required[10] or giving information which is incorrect, whether deliberately or not.[11]

    [10] Re Wendt and Secretary, Department of Social Security [1998] 53 ALD 153 at [24].

    [11] Re Secretary, Department of Social Security and McAvoy [1996] 44 ALD 721 at [41].

31. That would clearly be the case in this instance were an argument to be entertained that the payments in question were made erroneously by the Department. The Applicant’s claim on this point is without merit.

    THE HUNTER VALLEY TESTS

32. The Tribunal seeks to address applications for extensions of time using the criteria set out in Hunter Valley. They are as follows:

    Reasons for the delay: The Applicant pleads that he was unaware of his appeal rights and in any event precluded from exercising them due to his period of incarceration. The Tribunal does not accept that these are sufficient reasons to explain the delay. The Applicant knew from his experiences in making an application to the AAT, (he was presented at the AAT1 hearing) that time limits existed and needed to be observed and would have had this information more clearly presented to him when he received the AAT1 decision. Even if this was as late as 12 July 2017 he still had time before his return to custody on 4 August 2017 to file his request for review. 

    There is also nothing which would have prevented him from lodging his appeal while in custody and indeed the correctional services system (with which he would have been familiar from at least nine previous episodes of incarceration) has a series of prisoner-services (including liaison officers with the Department) to facilitate this. The Applicant also refers in his application to advice from “his counsel” and so presumably he had access to legal advice at some stage.

    The Tribunal notes that although explanations for delays are generally sought and provided, they are not statutorily required.[12] This was made explicit by the comments of Wilcox J in Hunter Valley where he said (as set out above), “There is no onus of proof upon an applicant for extension of time though an application needs to be made.”[13]

    [12] McKenzie and Secretary, Department of Social Security [1998] AATA 841 at [25]; Swanton v Military Rehabilitation and Compensation Commission [2017] FCA 1142 at [33].

    [13] Hunter Valley Developments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 3 FCR 344 at [348].

    1.Resting on his rights: The Tribunal does not believe that the Applicant rested in his rights, but rather that he failed to act within the time limits before 9 August 2017. It notes that once released from custody on 12 November 2018 he fairly quickly completed his appeal application on 7 December 2018. This is consonant with his claim that he was acting after advice from his counsel, although he does not state when this advice was received.

    2.Prejudice to Respondent: The Tribunal accepts that there would be some degree of prejudice to the Respondent given that this is 16 months out of date, although the Tribunal places relatively little weight on this. The Department is well equipped and well used to dealing with appeal matters which are outside the statutory time limits and well experienced in dealing with matters which may be considerably out of time.

    3.Interests of the general public or upsetting of established practices: This is not an issue requiring any attention.

    Substantial merits of the claim: The Tribunal is not empowered to conduct a detailed merits review when dealing with extension of time applications. However this must be qualified by saying that it is well established that if an application is so unlikely to succeed or so lacking in merit that it has little or no prospect of success then an extension of time should not be granted.

    In Jamal[14] Bromwich J stated:

    “ …it will seldom be in the interests of justice to grant an extension of time where an appeal would have little prospect of success, given the additional resource demands that it would impose upon the parties and the Court, and the inevitable impact it would have on other users of the Court.”

    The prospects of success for this Applicant must be rated as very low or almost none because the legislation is perfectly clear – a person is not entitled to be paid the DSP while they are in custody. There is nothing that any review process can do to overturn that fact.

    It is also the case that the Applicant has rights under social security legislation to seek to have the debt in question waived or reduced and that failure to grant an extension of time to appeal the AAT1 decision does not deprive him of these rights. Indeed it may be thought that the Applicant has greater prospects of having the debt reduce or waived by appeal through this channel than by seeking to have the AAT 1 decision set aside. That however is a matter of speculation. The AAT 1 took a view on this matter which this Tribunal does not consider it proper to do in these proceedings. On the other hand claims of financial hardship do not, to date, seem to have prevented recovery of a substantial part of the outstanding debt already.

    4.Fairness between the applicant and other persons: This again is a matter to which the Tribunal feels that it needs to give no consideration.

    [14] Jamal v Secretary, Department of Social Services [2018] FCA 513 at [6].

    MEDICAL EVIDENCE

33. In correspondence with the Tribunal the Applicant indicates that he will be “relying heavily on medical report of Dr Carne in support of his case.”

34. The material from Dr Carne is a 7 page report dated 8 January 1996 reporting his assessment of Mr Joseph Ayoub. His conclusion was to the effect that Mr Ayoub “has a significant intellectual disability, probably as a result of abnormal development in the formation of his brain before birth.” He diagnoses a “significant personality disorder” and an “intellectual disability (which) impairs (his) understanding the full implication of the acts he has carried out.”[15] His final diagnosis is of “mild or borderline intellectual disability and personality disorder with mixed features including schizoid and paranoid traits.”[16]

    [15] Medical report Dr Jonathan Carne (9 January 1996) at page [6]-[7].

    [16] Ibid page [8].

35. The Applicant has also submitted a further report by Dino Cipriani (a clinical psychologist) dated 9 September 2014. This report relies heavily on the earlier report of Dr Carne and concludes that Mr Ayoub suffers

    “a mild intellectual disability and residual schizophrenic disorder (as at April 2014) (disinhibition, lack of judgement and insight, grandiosity). He continues to suffer these conditions. He is not suffering from a mental illness according to the Mental Health Act (2007), as his psychosis appears to be in partial remission on his current medication and he is not a danger to himself or others.”[17]

    [17] Clinical report Dino Cipriani (9 September 2014) at page [17].

36. The Tribunal notes that, despite his name change registered in 1993, the Applicant presented himself to Mr Cipriani as Joseph Ayoub and appears to have been before the courts at that time under that name.

1. The Tribunal places little or no weight on these reports as they bear upon the matter of the Applicant’s DSP payments and his ability to manage his relationships with the Department. In his oral evidence to the Tribunal the Applicant presented as a clear thinker who had a logical approach to the matters under discussion. He referred clearly and accurately to the documentation before the Tribunal and the arguments advanced by the Minister. He made his case in relation to what he claimed was an error on the part of the Department in not cross-matching data about his name and identity. He cited High Court authority in relation to his position as an unrepresented litigant and in his summary, responding to the Minister it was clear that he was fully comprehending of all the relevant issues.

2. There is simply no basis for connecting these historic medical/clinical reports, whatever their value or continuing relevance, with any of the matter before the Tribunal in this application.

   CONSIDERATIONS

3. In Crick the Tribunal stated that “All the circumstances of the case must be considered, the overriding consideration being whether it is ‘reasonable in all the circumstances’ to grant the extension.”[18] All the factors outlined in Hunter Valley need to be taken into account[19] and a “calculus” (to borrow the Federal Court’s terminology[20]) arrived at balancing all the competing arguments.

   [18] Crick and Prosegur Australia Pty Ltd [2016] AATA 313 at [14].

   [19] Zizza v Federal Commissioner of Taxation [1999] FCA 37 at [27].

   [20] Contreras v minister for Immigration and Border Protection [2015] FCAFC 47 at [52].

4. In respect to the Applicant there are almost no arguments to support his application. The Tribunal does not accept that the reasons for the delay are persuasive, although the Applicant is under no obligation to demonstrate this point.

5. There is some, although not a significant, prejudice to the Respondent in the extension being granted.

6. The medical evidence referred[21] to in the Applicant’s formal application for an extension of time is not new evidence in that the reports in question are dated 1996 and 2014 and presumably have been available in other times and places when decisions about social security payments were being made or reviewed. In any event they are not relevant to any of the substantive matters now before the Tribunal.

   [21] Medical reports from Dr Johnathan Carne 8 January 1996 and Dino Cipriani dated 9 September 2014.

7. The Applicant knew that he was not entitled to payment of DSP during the dates in question because he had had similar payments cancelled or suspended on nine previous occasions while in custody.[22]

   [22] Respondent’s Statement of Facts, Issues and Contentions at [54(a)]. Section 37 T documents at [17].

8. He received the payments (and the Tribunal does not accept that he was unaware of their existence) which he did not do  “in good faith” as would be required in order to hold that the payments were made in error and that the Department should be held responsible this error. This is made clear in the judgement of Finn  J in Secretary, Department of Employment, Education, Training and Youth Affairs v Prince where His Honour defined “good faith” as follows:

   “Its concern is with the state of mind of a person concerning his or her receipt of the payment: if that person knows or has reason to know that he or she is not entitled to a payment received — ie is not entitled to use the moneys received as his or her own — that person does not receive the payment in good faith. Absent such knowledge or reason to know, the receipt would be in good faith.” [23]

   [23] Secretary, Department of Employment, Education, Training and Youth Affairs v Prince [1997] 50 ALD 186 at [189].

9. Fatally however, for the Applicant, the Tribunal is persuaded on the material before it that the application would have so little prospect of success at a full merits review hearing that it would be contrary to the Tribunal’s obligations to promote the “requirements of good government”[24] for it to be allowed to go any further.

   [24] Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd [1979] 24 ALR 307 at [335].

   DECISION

10. The application for an extension of time is refused.

I certify that the preceding 46 (forty -six) paragraphs are a true copy of the reasons for the decision herein of Chris Puplick AM, Senior Member

.............................[sgd]...........................................

Associate

Dated: 18 January 2019

Date(s) of hearing:
Applicant:	By phone
Solicitors for the Respondent:	Ms G Heggan, Department of Human Services (by phone)