Scott and Secretary, Department of Family and Community Services
[2005] AATA 269
•30 March 2005
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2005] AATA 269
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2004/1211
GENERAL ADMINISTRATIVE DIVISION ) Re DEANNA SCOTT Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Mr S. Webb, Member Date30 March 2005
PlaceCanberra
Decision The decision under review is affirmed. ..............................................
Mr S. Webb, Member
CATCHWORDS
SOCIAL SECURITY - Carer Payment - overpayment - debt - administrative error - overpayments not received in good faith - no special circumstances - decision affirmed
Administrative Appeals Tribunal Act 1975 s .35
Social Security Act 1991 ss. 8, 198, 210, 1064, 1223, 1224 (repealed), 1234, 1236, 1237, 1237A, 1237AAD
Social Security (Administration) Act 1999 ss 5, 67, 68, 72, 74, 179
Acts Interpretation Act 1901 s.28A
Evidence Act 1995 s. 160
Re Merrifield and Secretary, Department of Family and Community Services [2004] AATA 603
Re Meschino and Centrelink [2002] AATA 627
Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 50 ALD 186
Jazazievska v Secretary Department of Family & Community Services [2000] FCA 1484
Beadle v Director-General of Social Security (1985) 60 ALR 225
Re Secretary, Department of Social Security and Carruthers (1993) 31 ALD 567
Re Vitalone and Secretary, department of Social Security (1995) 38 ALD 169
Sekhon v Secretary, Department of Family and Community Services (2003) FCAFC 190
REASONS FOR DECISION
30 March 2005 Mr S. Webb, Member 1. This application by Deanna Scott is for review of a decision, which was affirmed by the Social Security Appeals Tribunal (“SSAT”) on 19 August 2004, to raise and recover a Carer Payment overpayment debt of $7,408.25 for which she was liable.
2. The matter came on for hearing in Milton on 25 February 2005. Mrs Scott was assisted by her husband, Mr Ian Scott, but was not legally represented at the hearing. She and her husband gave oral evidence. The Respondent Secretary was represented by Mr G. Lozynsky, Centrelink Service Recovery Team. Documents were tendered and labelled as exhibits at the hearing.
3. During the proceedings I directed Mr Lozynsky to obtain and file additional evidence concerning the period and quantum of the alleged overpayment debt and relevant Centrelink computer records, including a Customer Records Access Monitor (“CRAM”) report concerning actions in August and September 2000 that were recorded on Mrs Scott’s and Mr Scott’s Centrelink accounts. It was agreed that Mr Lozynsky would obtain and file a CRAM report on the basis that the report would be subject to confidentiality orders pursuant to s.35(2) of the Administrative Appeals Tribunal Act 1975 (“the AAT Act”) to prevent it being published to the Applicant or at large. Additionally, Mr Lozynsky was directed to clarify in the Respondent Secretary’s written submissions the applicable provisions under which the alleged debt was raised. In those circumstances, I acceded to a request by Mrs Scott to obtain and file additional evidence in support of her claims at hearing within seven days of the hearing, providing the Respondent Secretary with a further seven days, thereafter, in which to file the requisite material as directed and to make closing final submissions.
4. Mrs Scott filed additional material on 4 March 2005. That material is in Exhibit A1.
5. The Respondent Secretary filed additional material and submissions on 11 March 2005. That material, with the exception of the CRAM report is in Exhibit R2.
6. Considering the Respondent’s request for confidentiality orders in relation to the aforementioned CRAM report, and being mindful of previous Tribunal decisions in respect of the release of such material (see Re Merrifield and Secretary, Department of Family and Community Services [2004] AATA 603 at paragraph 40; Re Meschino and Centrelink [2002] AATA 627), I accept the Respondent’s submissions. I order, pursuant to s.35(2)(b) of the AAT Act, that the CRAM report in respect of the Applicant is not to be published and, pursuant to s.35(2)(c) of the AAT Act, that the contents of the aforementioned CRAM report are not to be disclosed to the Applicant in these proceedings, disclosure of that document being restricted to the Tribunal and its staff.
factual context
7. The following factual information arises from the documentary and oral evidence. It is accepted and is not in dispute.
8. Prior to May 2000 Mrs Scott and her husband were in employment, managing a motel in Merimbula. They lived in the motel residence with Mrs Scott’s mother, Lilly Smith. However, that arrangement came to an end shortly before 12 May 2000 at which time they were unemployed and had relocated to a house at 16 Pacific Way, Tura Beach that they had jointly purchased on 10 April 2000 (T26 folio 88 and T65 folio 241). Mr Scott applied for a New Start Allowance, which was granted.
9. On 29 May 2000 Mrs Scott claimed Carer Payment at the Bega Centrelink office (T5). She was at that time in receipt of Carer Allowance and had been providing daily care to her ailing mother for an extended period. Mrs Scott declared that she owned two properties (T5 folio 25) but she did not declare any income from those properties on the claim form (T5 folio 27).
10. On 29 May 2000 Centrelink wrote to Mrs Scott informing her that Carer Payment had been granted from 12 May 2000 and the rate of the payment was based on her declared combined annual income of $166.94 (T8).
11. On 29 August 2000 Mrs Scott informed Centrelink that her mother had been hospitalised on 16 August 2000 (T14).
12. In August 2000 Mr and Mrs Scott were offered employment managing the Harbour Royal Motel in Ulladulla (neither could recall the precise date). Centrelink Jobseeker records indicate that Mr Scott was referred to that job on 21 August 2000 (Exhibit R2, Annexure 5, p6).
13. Mr and Mrs Scott accepted employment at the Harbour Royal Motel in Ulladulla on an equal partnership basis under the business name Motel Management Services, with a total combined salary of $45,000 per year plus an unspecified annual performance bonus. They commenced that employment on or about 4 September 2000.
14. On or about 4 September 2000 Mr and Mrs Scott relocated into the residence at the Harbour Royal Motel. Their house at 16 Pacific Way, Tura Beach was tenanted from 29 September 2000 and was productive of rental income thenceforth (T65 folio 241). The net annual rental income from that property recorded in Mr and Mrs Scott’s partnership tax return for the 2001 tax year was $9,564 (T65, folio 241).
15. I note in passing that during all relevant periods Mr and Mrs Scott jointly owned and continue to own properties at 257 Chloride Street and 352 William Street in Broken Hill (T6 folio 35 and T7 folio 38). At all relevant times those properties were tenanted and were productive of net annual rental income to Mr and Mrs Scott of $1,135 and $1,543 in the 2001 tax year (T65 folios 242 and 243).
16. On 11 September 2000 Centrelink wrote to Mr Scott informing him that his New Start Allowance had been cancelled from that date “because you have returned to work” (T17). Curiously, the Centrelink computer records indicate that Mr Scott’s New Start Allowance was automatically cancelled with effect from 29 August 2000: “NSA DID NOT LODGE FORM * AUTO CAN 29 AUG 2000” (T16).
17. On 14 August 2001, following a data matching exercise, Centrelink wrote to Mrs Scott at 16 Pacific Way, Tura Beach requesting information about her combined income (T19). Centrelink computer records indicate that:
(a)on 20 August 2001 Mr Scott contacted Centrelink by telephone to discuss the contents of the letter, as a result of which Centrelink noted Mrs Scott’s combined earnings of $45,000 per year from motel management (T20 and T21);
(b)on 20 August 2001 Centrelink wrote to Mrs Scott at 16 Pacific Way, Tura Beach to inform her about changes to her Carer Payment rate on the basis of her combined annual income of $45,134.70 (T22);
(c)on or about 24 August 2001 information provided by Mr and Mrs Scott was received by Centrelink (T23-T26). Therein Mrs Scott indicated that:
(i)she and her husband did not “have any assets which [she had] not advised [Centrelink] about in answer to other questions on forms completed by you” (T24 folio 75);
(ii)she and her husband did not receive income from “any other source you have not included elsewhere on this form”, that is other than from their employment as motel managers (T25 folio 84); and
(iii)she and her husband own a house at 16 Pacific Way, Tura Beach (T26);
(d)on 19 October 2001 Mrs Scott contacted Centrelink by telephone to ascertain “what is happen [sic] with review” and was informed that the information package had been received “but not yet reviewed”;
(e)on 10 July 2002 Mrs Scott informed Centrelink that her mother had died (T30);
(f)Mrs Scott’s Carer Payment payments continued under the bereavement provisions of the Act until 7 October 2002 (T31);
(g)on 5 November 2002 Centrelink sent a “QSS32” letter to Mrs Scott requesting additional information, including taxation returns and mortgage details for each property, in relation to which it is recorded “Other properties not advised during review, but advised at grant of NSA and Carers 29/5/00, but not coded” (T20 folio 67);
(h)on 11 November 2002 Mr Scott contacted Centrelink by telephone to ascertain why additional information was required (T20 folio 67).
18. On 4 December 2002 Centrelink requested information about Mr and Mrs Scott’s earnings and rental income from the Australian Taxation Office, which was received on 23 December 2002 (T20 folio 67, T37 and T38).
19. On 18 June 2003 Centrelink wrote to Mrs Scott’s accountant, Mr Shane Roberts, requesting copies of Mrs Scott’s tax returns for the 2000-2001 and 2001-2002 financial years (T40), which were provided on 30 June 2003 (T47 to T57).
20. On 25 June 2003 the Australian Taxation Office provided Centrelink with extracts from the tax returns of Mrs Scott and Mr Scott concerning rental income during the 2001 and 2002 tax years (T41).
21. On 27 June 2003 Centrelink informed Mrs Scott that she had been overpaid Carer Payment in the amount of $6,794.58 in the period from 29 August 2000 to 7 October 2002 as a result of her failure to inform Centrelink about her income (T46).
22. On 4 November 2003 Centrelink recalculated the amount of Mrs Scott’s Carer Payment overpayment to be $7,442.67 (T68). Also on that day Centrelink determined that Mr Scott had been overpaid New Start Allowance in the amount of $155.55 from 29 August to 10 September 2000 (T69). These calculations were based on ‘evidence’ that Mrs Scott and her husband “commenced employment thru [sic] the partnership Ian and Deanna Scott on 04/09/00” (T70).
23. On 19 November 2003 Mrs Scott requested a review of Centrelink’s decision (T71).
24. On 8 January 2004 Centrelink informed Mrs Scott that the amount of the Carer Payment overpayment debt “has been increased from $7442.67 to $7452.74” (T78).
25. On 16 January 2004 an Authorised Review Officer (“ARO”) informed Mrs Scott that the amount of the overpayment had been recalculated and adjusted to $7,408.25 (T83). The ARO determined that the debt was recoverable and there were no grounds for its waiver in whole or in part.
26. Mrs Scott pursued the matter to the SSAT. On 19 August 2004 the SSAT decided to affirm the ARO’s decision (T2).
27. On 23 September 2004 Mrs Scott made application for review of the SSAT decision by this Tribunal (T1).
issues for determination
28. The issues for determination are:
(a)whether Mrs Scott was overpaid Carer Payment in the period from 29 August 2000 to 7 October 2002, and if so
(b)whether the amount of that overpayment is correctly raised as a debt due to the Commonwealth, and if so
(c)whether there are circumstances whereby it would be appropriate to write off or waive the debt in whole or in part.
applicable legislation and legal principles
29. Mrs Scott’s application rises for consideration under the Social Security Act 1991 (“the Act”) and the Social Security (Administration) Act 1999 (“the Administration Act”).
30. Under the Act the rate of Carer Payment to a qualified claimant is subject to an income test (ss.210 and 1064). “Income” is defined at s.8 of the Act. Under the Administration Act the Secretary has power to require a claimant to provide information specified in a notice, such as, for example, information about any change in income that may affect the rate of payment (Subdivision B, Division 6). Failure to comply with such a notice is an offence (s.74, Administration Act).
31. Prior to 1 July 2001, s.1224(1) provided that if a social security payment has been made to a person and the amount was paid because of a false statement or a failure to comply with a provision of the social security law or the Act, then the amount paid is a debt due to the Commonwealth. Amendments to the Act came into effect on 1 July 2001. Thereafter s.1223(1) provides that if a social security payment is made to a person who is not entitled to that payment, for whatever reason, the amount so paid is a debt due to the Commonwealth.
32. Under the Act the Secretary has power to waive or write off the Commonwealth’s right to recover a debt in certain circumstances. A debt, in whole or in part, that is attributable solely to an administrative error must be waived if it was received in good faith (s.1237A). The meaning of the term “received in good faith” has been considered by previous courts and tribunals. Finn J discussed the meaning of “good faith” in Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 50 ALD 186 at 189:
“Its concern is with the state of mind of a person concerning his or her receipt of 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.”
In Jazazievska v Secretary Department of Family & Community Services [2000] FCA 1484 at 40 - 42 Cooper J said of “good faith”:
“40 Prima facie, s 1237A(1) is concerned with actual personal receipt by the debtor of the payment or payments which give rise to the debt. The issue of good faith is, for the purpose of the section, to be determined when the debtor commences to exercise control over the payment by retaining it. It is at this time that the recipient must act with the requisite good faith. A lack of good faith does not mean that the recipient of the payment must be acting fraudulently when the payment is received and retained. It means that for whatever reason, the recipient acts without an honest belief that he or she was entitled to receive and retain the payment when he or she receives the payment and decides to exercise control over it by retaining it.
41 A person does not act in good faith where the person turns a blind eye to circumstances which raise doubt as to the entitlement of the person to receive and retain the payment or refuses to make reasonable inquiries where doubt exists. Although said in a different context, the observations of Lord Blackburn in Jones v Gordon (1877) 2 App Cas 616 at 629 are apposite. His Lordship said :
"... If he was (if I may use the phrase) honestly blundering and careless, and so took a bill of exchange or a bank-note when he ought not to have taken it, still he would be entitled to recover. But if the facts and circumstances are such that the jury, or whoever has to try the question, came to the conclusion that he was not honestly blundering and careless, but that he must have had a suspicion that there was something wrong, and that he refrained from asking questions, not because he was an honest blunderer or a stupid man, but because he thought in his own secret mind - I suspect there is something wrong, and if I ask questions and make farther inquiry, it will no longer be my suspecting it, but my knowing it, and then I shall not be able to recover - I think that is dishonesty. I think, my Lords, that that is established, not only by good sense and reason, but by the authority of the cases themselves."
42 A recipient of a payment to which he or she is not entitled, cannot avoid the requirement of good faith in s 1237A(1) by the mere circumstance that the person arranges for direct payment to an account of that person with a financial institution and in consequence is unaware of the fact of the payment at the time of its actual receipt. ”
33. Under the Act, provision is made for the waiver of a debt in cases where the debtor did not knowingly fail or omit to comply with a provision of the Act and special circumstances (other than financial hardship alone) exist that make it more appropriate to waive than write off the debt (s.1237AAD). The term “special circumstances” has been the subject of consideration by previous courts and tribunals. In Beadle v Director-General of Social Security (1985) 60 ALR 225 the Full Federal Court observed at 228 that the term “special circumstances “is sufficiently understood in our view not to require judicial gloss” and affirmed the decision of the Tribunal in Re Beadle and Director-General of Social Security (1984) 6 ALD1.
consideration of the evidence and findings
34. Making this decision I have carefully considered all of the evidence, the submissions of the parties, the relevant caselaw and legislation.
35. Many of the facts in this matter, set out above, are not in dispute.
notice
36. I am satisfied that Mrs Scott was given proper notice of her obligations to inform Centrelink about changes in her combined annual income pursuant to s.67 of the Administration Act on 29 May 2000 and 21 August 2001. Those notices are at T8 and T22. As failure to comply with a s.67 notice is an offence punishable by imprisonment (s.74, Administration Act), strict compliance with the provisions governing the issue and contents of the notice is required (see Re Secretary, Department of Social Security and Carruthers (1993) 31 ALD 567; Re Vitalone and Secretary, Department of Social Security (1995) 38 ALD 169 at 174). Subparagraph 72(1)(c) of the Administration Act requires that a notice must specify how the person is to give the information or statement to the Department. The notices at T8 and T22 required Mrs Scott to “tell us within 14 days” if her circumstances changed in the manner specified. In so far as ‘telling’ is the manner in which the required information was to be given I am satisfied that the notice is compliant with the requirements of the section. I note in passing, however, that even if the notice was deficient in this regard, it may be saved for present purposes by subs 72(2) of the Administration Act. Nonetheless, s.72(1)(c) has a purpose and function that should not be ignored or overlooked. It is intended that a compliant notice will inform a claimant or a recipient of a social security payment or benefit of the manner in which they are required to provide information to Centrelink. Failure to provide the information in the manner specified is a penal offence.
37. There is no issue about the notices being given by the Respondent and received by Mrs Scott. Even though Mrs Scott gave evidence that she did not recall receiving the 29 May 2000 notice, she accepted that she probably did. I am satisfied that the notice was properly given by post and is deemed to have been received by Mrs Scott in the normal course of postal delivery soon thereafter (s.28A Acts Interpretation Act 1901; s.160 Evidence Act 1995).
38. It follows, therefore, that Mrs Scott was legally obligated to inform Centrelink about any change in her combined annual income and to ensure that the information she provided was complete and correct in compliance with the notices she was given. I accept that Mrs Scott, by her own account, is not a person who is comfortable with financial accounts and related matters, leaving those matters largely to her husband. Nevertheless, that does not excuse or diminish the obligation Mrs Scott was under to comply with the notice she was given.
income
39. I am satisfied and find that Mrs Scott failed or omitted to inform Centrelink about the totality of her combined annual income during relevant periods.
40. The evidence is that Mrs Scott and her husband own two properties at Broken Hill and derived income from the rental of those properties during all relevant periods (T64 and T65). The evidence is that Mrs Scott informed Centrelink that she jointly owned two properties in her application for Carer Payment. However, she failed or omitted to inform Centrelink of any income she derived from those properties when applying for Carer Payment (T5 folio 27).
41. Mrs Scott and her husband own a property at Tura Beach and derived income from its rental from 29 September 2000 (T64 and T65). However, Mrs Scott failed or omitted to inform Centrelink of that income.
42. It is not in dispute and I accept that Mrs Scott and her husband commenced employment on 4 September 2000 at the Harbour Royal Motel in Ulladulla (Oral evidence consistent with T2 folio 3 and T72 folio 266). They lived in a residence at that motel and were paid, in combination, $45,000 per year. They continued in employment for the duration of the period in which Mrs Scott was paid Carer Payment, that is until 7 October 2002, and thereafter.
overpayment debt
43. Mrs Scott was paid Carer Payment on the basis of a declared combined annual income of $166.94. That income amount did not take into account any income from the two rental properties she and her husband jointly owned in equal shares in Broken Hill.
44. Furthermore, the increase in Mrs Scott’s combined income as a result of her employment on 4 September 2000 and the rental of a property at Tura Beach, which was also jointly owned in equal shares with Mr Scott, on 29 September 2000 was not correctly stated for the purpose of the Carer Payment income test and did not result in any reduction in the rate of her Carer Payment.
45. Plainly, Mrs Scott was overpaid Carer Payment in the period from 4 September 2000 to 7 October 2002, at least. Mrs Scott did not dispute the correctness of the amount of the overpayment calculated by the ARO. I accept that the overpayment amount was correctly calculated by the ARO and is $7,408.25.
46. Mrs Scott was not entitled to receive the amount she was overpaid as a result of her failure or omission to ‘tell’ Centrelink about any change in her income under the social security law. Even if I accept that she did ‘tell’ Centrelink on or about 28 August 2000 of her impending earnings in employment at the Harbour Royal Motel, she was not entitled to receive the amount of Carer Payment she was paid thereafter. It follows that the overpaid amount of $7,408.25 is a debt due to the Commonwealth. The amount that was overpaid prior to 1 July 2001 is a debt due to the Commonwealth pursuant to s.1224(1) of the Act then applying, and the amount that was overpaid after 1 July 2001 is a debt due to the Commonwealth pursuant to s.1223(1) applying thereafter. I so find.
47. I am satisfied that Mrs Scott’s failure or omission to inform Centrelink about income she derived from rental properties was not done knowingly or deliberately. I accept that Mrs Scott is not a person who is comfortable dealing with financial accounts and either did not know or did not consider it necessary to find out what income she derived from her rental properties in Broken Hill when applying for Carer Payment, and simply did not turn her mind to the obligation she was under to inform Centrelink about any change in her income as a result of the rental of her property at Tura Beach. Nonetheless, Mrs Scott’s income for the purpose of the Carer Payment income test was understated as a result.
debt recovery
48. Under the Act provision is made for the waiver of a debt to the Commonwealth in certain circumstances.
administrative error
49. Mrs Scott submitted that her debt was solely attributable to an administrative error of Centrelink and should, therefore, be waived in full. As will appear I do not agree.
50. Plainly, on the evidence before me Mrs Scott failed or omitted to properly inform Centrelink about her income from rental properties in Broken Hill and Tura Beach. It follows that a proportion of her debt is solely attributable to that failure or omission on her part and cannot be waived as a result of administrative error pursuant to s.1237A(1) of the Act. Simply, there was no administrative error in relation to that proportion of her debt.
51. The remaining proportion of Mrs Scott’s debt arises because the rate of her Carer Payment was not adjusted in relation to her earnings from employment from 4 September 2000. In order to address Mrs Scott’s submission it is necessary to determine whether that proportion of her debt was solely attributable to administrative error in the Commonwealth, and, if so, whether Mrs Scott received the overpaid amounts in good faith.
52. Whether Mrs Scott informed Centrelink about her employment and earnings from 4 September 2000 is unclear. She and her husband strongly asserted that they attended the Bega Centrelink office and the office of Mission Australia late in August 2000 and informed both organisations of their (then) impending employment at the Harbour Royal Motel in Ulladulla. Their evidence was that they attended those offices on the same day, the date of which they could not recall, but thought it was likely to be in the last week of August 2000, soon after they were offered employment at the Harbour Royal Motel but before they had taken up that employment.
53. In the Respondent’s submission there is no dispute that Mr Scott informed Mission Australia about his return to full-time employment, contending that he did so on 11 September 2000, but that no information was provided by Mrs Scott in relation to her employment or earnings at that time. In support of that contention the Respondent relies on evidence that Mr Scott’s Integrated Employment System records were updated on 11 September 2000 (Exhibit R2, Annexure 5, p1 and Annexure 6). However, I am not satisfied that those records are evidence that Mr Scott informed Mission Australia about his employment at the Harbour Royal Motel on 11 September 2000. While I accept that his records were updated on 11 September 2000, that alone does not compel me to conclude that Mr Scott conveyed information to Mission Australia or Centrelink on that day. It is possible that he did and his records were updated on that day. It is also possible that he informed Mission Australia at an earlier time, on a different day and his records were subsequently updated on 11 September 2000. The Respondent did not call any witnesses or place any documentary evidence from Mission Australia on this point.
54. Careful examination of the Centrelink documents reveals that Mr Scott was given a referral for the Hotel Manager position at the Harbour Royal Motel on 21 August 2000 (Exhibit R2, Annexure 5, p6). The Centrelink records indicate that he commenced that employment on 11 September 2000 (Exhibit R2, Annexure 5, p 4), on which day his Newstart Allowance was “inactivated” (Exhibit R2, Annexure 5, p2) and a request was made to Centrelink to cancel his Newstart Allowance (Exhibit R2, Annexure 6). In consequence of that cancellation the notice at T17 was generated. However, the ARO ascertained that Mr Scott commenced his employment on 4 September 2000 and not on 11 September 2000. That fact was confirmed by Mr Scott in his evidence before the SSAT and this Tribunal, which I have accepted. The Centrelink records reveal that Mr Scott failed to lodge a Newstart Allowance continuation form for the fortnight commencing on 29 August 2000 and a request was made for cancellation of his Newstart Allowance for that reason on 4 December 2000 (Exhibit R2, Annexure 7).
55. I note in passing that Mr Scott was required to complete New Start Allowance activity forms on a fortnightly basis for continuation of his New Start Allowance. 11 September 2000 marked the completion of one such fortnight. In those circumstances it is an improbable coincidence of timing that on 11 September 2000 Mr Scott would inform Mission Australia about his employment, which had commenced on 4 September 2000.
56. The CRAM report obtained by Mr Lozynsky indicates that the computer records of Mrs Scott and Mr Scott were accessed on 28 and 29 August 2000. The Respondent Secretary asserts that those transactions were not related to Mr or Mrs Scott’s income or earnings records. That may be true, but the CRAM report is not evidence that Mrs Scott did not tell the Centrelink officer about her impending employment and likely earnings. Alternatively, if she did tell Centrelink about her employment and earnings, the CRAM report is evidence that Centrelink did not update her computer records with that information.
57. In the Secretary’s submission the CRAM report indicates that on 28 August 2000 a female Centrelink officer accessed the records of Mrs Scott and her husband in order to “arrange an appointment with a Centrelink officer” for each of them, and subsequently a male Centrelink officer accessed Mr Scott’s records to record lodgement of a Newstart Allowance continuation form. That is consistent with the evidence and I so find. The following day, 29 August 2000 Mrs Scott’s records were updated by a Centrelink officer in the Cairns Call Centre in relation to a change in the care arrangements for Mrs Scott’s mother (Exhibit R2, p3). However, the CRAM report does not indicate whether Mrs Scott and her husband attended the Bega Centrelink office in person, as they claim, on 28 August 2000, nor does it reveal the purpose of the appointments that were arranged on that day.
58. On balance, I am prepared to accept Mrs Scott’s evidence that on 28 August 2000 she and Mr Scott travelled to Bega and informed Mission Australia and Centrelink about their (then) impending employment, that was due to start in September 2000. That much, it can be inferred, is consistent with the contents of the CRAM report. However, there is no evidence to support their contention that they informed Centrelink about their earnings in that employment at that time. The evidence is that on 28 August 2000 appointments were made for Mrs Scott and her husband by a female Centrelink officer in the Bega Centrelink office, and later that day Mr Scott’s records were up-dated to record lodgement of a Newstart Allowance continuation form by a male Centrelink officer. The reason the appointments were made for Mr and Mrs Scott is not clear on the evidence. Evenso, the evidence is that their records were not updated with any details of their impending employment or earnings.
59. There is no evidence before me that Mrs Scott or her husband attended the appointments that were made on 28 August 2000. Nor is there compelling evidence that Mrs Scott or her husband contacted Centrelink thereafter in relation to their employment or earnings. The evidence is that on 29 August 2000 Mrs Scott informed Centrelink about changes in the care arrangements for her mother by telephone and that Mr Scott’s records were updated on 11 September 2000 by Mission Australia and subsequently by Centrelink in relation to cancellation of his Newstart Allowance. There is no evidence before me that Mrs Scott’s Centrelink records were updated as a result of her employment and earnings until 21 August 2001 (T27 folio 93).
60. On that evidence, while I accept that Mrs Scott told Centrelink about her a likely change in her employment status, I am not satisfied that her debt, in relevant part, was attributable solely to an administrative error in Centrelink. There is insufficient evidence for me to conclude to the requisite standard of satisfaction that Mrs Scott told Centrelink about the change in her income as a result of her employment at the Harbour Royal Motel. That being so, I cannot find that her debt was solely the result of administrative error in the Commonwealth.
61. The meaning of “attributable solely” in the context of (then) s.1237(1) of the Act was considered by the Full Federal Court in Sekhon v Secretary, Department of Family and Community Services (2003) FCAFC 190, in which Nicholson J said:
“23 However, s 1237(1) applies only where the debt concerned `is attributable solely to an administrative error made by the Commonwealth...' The word 'attributable' brings into play the notions of causation 'as an effect to a cause': Macquarie Dictionary, 2nd edn. 1991, p 106. The word 'solely' brings notions of exclusivity. Solely means 'as the only one or ones' or 'exclusively or only': Macquarie Dictionary, p 1664. It means 'one and only, single; only', also 'singular, unique, unrivalled': The New Shorter Oxford English Dictionary, 1993, p 2938. It is used elsewhere in the Act but not in conjunction with 'attributable' so that other usage does not assist in relation to the subsection in question. In that subsection the word 'solely' has a function to play. To apply the word 'solely' in its correct meaning does not result in s 1237(1) not having a function to perform, for there are remaining circumstances in which it can have application. Nor does it result in there being an absence of remedy in relation to compensation claims because arguably where it does not apply and there has been administrative error by the Commonwealth, s 1237AAD could have application. There is therefore no reason not to give the word 'solely' its proper application in the circumstances.”
62. If there was any administrative error in relation to information concerning Mrs Scott’s earnings from employment at the Harbour Royal Motel, it was that Centrelink failed to properly record and act upon information provided by Mrs Scott. However, even though I accept that Mrs Scott informed Centrelink about her impending employment, there is no evidence to corroborate her claim that she informed Centrelink about her earnings from that employment. The evidence, on its face, appears to indicate that an appointment was made with Mrs Scott. However, there is no evidence that she kept that appointment.
63. It follows, on the balance of probabilities, that Mrs Scott’s debt is not solely attributable, in whole or in part, to administrative error and cannot be waived pursuant to s.1237A(1) of the Act.
64. Even if I accepted that Mrs Scott told Centrelink about the likely change in the combined income as a result of her impending employment and I had found administrative error as the sole cause of a proportion of Mrs Scott’s debt, the matter would not resolve in Mrs Scott’s favour. I am satisfied that Mrs Scott did not receive the overpaid amounts in good faith. By her own account, she knew that she should declare any change in her income to Centrelink. She knew and had reason to know that the rate of her Carer Payment was likely to reduce in relation to an increase in her earnings. She knew that the Carer Payments did not reduce after 4 September 2000 because the amount of Carer Payment deposited into her bank account did not change, but she did nothing to check whether the payments were correct. Nor did she make any enquiry or raise any doubts about the correctness of her Carer Payments with Centrelink. Mrs Scott claimed that she “did not turn a blind eye” to the matter of the rate of her Carer Payments after 4 September 2000, and she trusted Centrelink to have correctly calculated her entitlement. However, by her own account it is clear that Mrs Scott thought about the rate of her Carer Payment and decided not to check with Centrelink to ascertain whether it was correct. Mrs Scott knew and had reason to know that the rate of her Carer Payment would be affected by an increase in her income but decided not to query whether she was being correctly paid after 4 September 2000. That being so, I am satisfied that Mrs Scott did not receive those overpaid amounts in good faith.
write-off
65. There are no grounds on which to write off Mrs Scott’s debt pursuant to s.1236 of the Act.
special circumstances
66. Turning to consider whether there are special circumstances that make it appropriate to waive the Commonwealth’s right to recover Mrs Scott’s debt in whole or in part, it is necessary to consider the entirety of Mrs Scott’s circumstances.
67. I have found that Mrs Scott failed or omitted to inform Centrelink about aspects of her combined annual income, but I am satisfied that she did not do so deliberately or knowingly.
68. Mrs Scott and her husband are in good health and are earning in employment. They own real property assets in Broken Hill and Tura Beach, each of which is rented and under mortgage. They are not in straitened financial circumstances, even though, like many, they have little disposable income in excess of their expenses. They have no dependants. None of those circumstances are within the meaning of the term “special circumstances”.
69. I note the delays in Centrelink dealing with Mrs Scott’s debt issues. Nonetheless, I am satisfied in this case that Centrelink’s delays were caused in part by Mrs Scott’s failure or omission to provide certain information and do not constitute special circumstances.
70. I am mindful of the effect of the imprecise drafting of the notices issued to Mrs Scott on 29 May 2000 and 21 August 2001. That imprecise wording, whereby Mrs Scott was required to “tell us within 14 days” if certain circumstances changed or were “likely to” change, may be the cause of confusion, and this is a case on point. Furthermore, such imprecise wording places an onus on Centrelink to properly record and act upon information that has been provided verbally, leaving open as a real possibility disputation, such as in this case, about whether the requisite information has been provided in sufficient degree and within the specified time to enable Centrelink to properly act upon it.
71. I am satisfied that Mrs Scott believed that she had complied with the notice requirements, in that she told Centrelink about a likely change in her circumstances as a result of her impending employment. However, it can be inferred from the evidence, scant as it is, that Centrelink required further information that was to be obtained at an appointment with Mrs Scott that was arranged on 28 August 2000. There is no evidence that Mrs Scott kept that appointment or pursued the matter with Centrelink to ensure that she was not overpaid after commencing her employment at the Harbour Royal Motel, even when she realised that her Carer Payment rate had not reduced after 4 September 2000. That being so, I am satisfied that the imprecise wording of the notices does not constitute special circumstances, whereby it would be appropriate to waive the Commonwealth’s right to recover all or part of Mrs Scott’s debt.
72. Having carefully considered the entirety of Mrs Scott’s circumstances, I am satisfied that nothing unfair, unjust or unreasonable will result from strict application of the recovery provisions of the Act and find that there are no special circumstances that make it appropriate to waive Mrs Scott’s debt to the Commonwealth pursuant to s.1237AAD(1) of the Act.
73. That being so and in the circumstances it is appropriate for the respondent to agree to an appropriate arrangement with Mrs Scott for the recovery of her debt by instalments pursuant to s.1234 of the Act.
decision
74. The decision under review is affirmed.
I certify that the 74 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S Webb, Member
Signed: Z. Khan
AssociateDate/s of Hearing 25 February 2005
Date of Decision 30 March 2005
Applicant Unrepresented
Representative for the Respondent Mr G. Lozynsky
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