Sams v Secretary, Department of Social Services

This matter concerned an appeal by Mrs Sams against a decision of the Social Services & Child Support Division of the Administrative Appeals Tribunal, which affirmed a decision by Centrelink regarding the calculation of her compensation preclusion period. Mrs Sams had received two lump sum compensation payments for a workplace injury, the first in October 2011 and the second, a final settlement, in December 2013. She also received periodic compensation payments between the settlement date and February 2014. Centrelink advised Mrs Sams of a preclusion period, during which she was ineligible to receive income support.

The primary legal issues before the court were whether Mrs Sams was subject to a compensation preclusion period and, if so, its length and commencement date. Additionally, the court was required to determine if any "special circumstances" existed that would warrant a reduction in the calculated preclusion period, as provided for under section 1184K(1) of the Social Security Act 1991 (Cth).

The court affirmed the decision under review. It found that, in accordance with section 1170(1) of the Act, the two lump sum payments were to be treated as a single payment. The "compensation part" of this lump sum was calculated and then divided by the relevant income cut-out amount to determine the preclusion period. This calculation resulted in a preclusion period of 156 weeks, commencing on 14 February 2014, the day after her periodic compensation payments ceased. Regarding special circumstances, the court considered the evidence of how Mrs Sams spent her compensation money, including purchasing a car, repaying debt, medical expenses, household items, and financial assistance to family and friends. However, it found that these circumstances did not possess the "particular quality of unusualness" required to be considered "special" under the Act, beyond any adjustments already made. Consequently, the preclusion period was ordered to remain unchanged.