Semyon Naiger and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2009] AATA 936

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 936

ADMINISTRATIVE APPEALS TRIBUNAL            )

)          No 2008/4701

GENERAL ADMINISTRATIVE DIVISION		)
Re		Semyon Naiger

Applicant

And Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

Respondent

DECISION

Tribunal The Hon B Tamberlin QC, Deputy President

Date4 December 2009

PlaceSydney

Decision  The decision under review is set aside, and the matter is remitted to the Respondent

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

The Hon B Tamberlin QC

Deputy President

CATCHWORDS

SOCIAL SECURITY- age pension- failure to disclose assets- determination of the value of assets- separated under one roof- property registered in joint names when no contribution made by the Applicant- no beneficial interest in property- decision under review set aside- remitted to Respondent.

LEGISLATION

Social Security Act 1991 (Cth) section 4.

REASONS FOR DECISION

4 December 2009 The Hon B Tamberlin QC, Deputy President

1.       This is an appeal from a decision of the Social Security Appeals Tribunal (SSAT) made on 3 September 2008. The issue before the SSAT was whether a Centrelink decision to raise and recover an age pension debt should be varied.  The Centrelink decision to review the debt was based on failure to disclose assets.  The SSAT directed that the matter be sent back to Centrelink for reconsideration in accordance with directions that the debt be re-calculated.

ISSUES

2.       The issue for decision by this Tribunal turns on proper determination of the value of the Applicant’s assets during the debt period, which was from 30 May 1996 to 12 December 2006.  The amount sought to be recovered is $73,117.96.

FACTS

3.       The relevant facts are that Mr Semyon Naiger, who was born on the 19 May 1931, applied for an age pension on 16 May 1996.  This was granted with effect from 30 May 1996.  In his claim forms Mr Naiger advised that he had no interest in any real estate other than a house at 23 Ismay Avenue, Homebush (the Homebush property) in which he and his wife, Mrs Polya Naiger, resided at the time. 

4.       Over the next 10 years, Centrelink sent Mr Naiger various letters about his age pension in which he was required to inform Centrelink whether his circumstances had changed, or if his assets had exceeded the allowable limits at any point in time. 

5.       From 22 November 1996 onwards, it is common ground that Mr Naiger and his wife were separated.  In that period Mrs Naiger moved to a property at 11/745 Old South Head Road, Vaucluse (the Vaucluse property).  Mr Naiger contends that he and his wife were separated for at least three years before the 22 November 1996, although they lived in the same premises.  This is a disputed question in the proceeding. 

6.       On 22 December 1999 Mr and Mrs Naiger disposed of the Homebush property and later, Mrs Naiger moved to the Vaucluse property. 

7.       Centrelink later became aware that Mr and Mrs Naiger were both registered as joint tenants of the Vaucluse property, which was purchased on 12 January 1994 for $230,000.00.  Centrelink also became aware that they jointly owned property at North Arm Cove, Glen Innes, purchased in about March 1983 for $5,000.00, which consisted of lots on two separate titles. 

8.       On 22 February 2007 Centrelink raised a debt against Mr Naiger for an overpayment of age pension from 30 May 1996 to 12 December 2006 in an amount of $63,877.16.

9.       Mr Naiger sought review of this decision by an Authorised Review Officer (ARO).  On 27 November 2007, the ARO varied Centrelink’s decision to raise and recover the debt.  The debt amount was subsequently increased to $81,295.80 on 18 March 2008.

10.     Mr Naiger appealed to the SSAT which heard and determined the appeal on 3 September 2008.

Marital Status as at 30 May 1996

11.     The SSAT found that Mr Naiger was a member of a couple with Mrs Polya Naiger at the time of the grant of his age pension on 30 May 1996, and that their principal residence was the Homebush property.

12.     This finding is disputed by the Applicant.  Mr Naiger contends that as at that date, he and his wife had been separated for a period of at least three years.  In the hearing before the Tribunal, statements were filed by Mrs Naiger.  She was cross-examined in some detail and gave evidence that she married Mr Naiger in the Ukraine in 1961 and had two children, Michael, born in 1961, and Olga, born in 1966.  The family left Russia and went to Italy in 1974 before arriving in Australia in 1975.  Mrs Naiger worked as from the date of her arrival up to 1993.  Her husband, Mr Naiger, took a longer period to gain employment.  In about 1978 or 1979 they purchased a property at Homebush (the Homebush property), and had a mortgage. 

13.     Mr and Mrs Naiger lived at the Homebush property, which is where they brought up their children. 

14.     Mrs Naiger gave evidence that her relationship with Mr Naiger gradually became worse and they led separate lives but remained living in the same premises at Homebush.  This separation took place in about 1993. While she went out to work he was mainly not working.  They had separate bank accounts and lived increasingly separate lives. 

15.     The evidence of Mrs Naiger, as to her relationship with Mr Naiger, is supported by that of their daughter, Olga Guliev who filed a statement and was cross-examined in this matter.  Mrs Guliev was born on 21 March 1966 and married Victor Guliev in 1987, with whom she had three children.  She lived at the Homebush property with her parents until her marriage in 1987.  She testified that for a long time before she left the Homebush property her parents had a very difficult marriage, and were often arguing.  Due to financial difficulties, she and her husband moved back to live in Homebush in about 1991. Mrs Guliey observed that her parents lived separate lives, in the sense that, although they were still living under the one roof, they slept separately and lived independent of each other.  Her mother went out to work each day and had her own life away from home and her father was not working.  Her mother worked until 1993 when she took a redundancy.  She states that her parents had separate finances. 

16.     In the course of oral testimony before me Mrs Naiger stated that by 1993, the relationship between herself and her husband had become unbearable, and as a consequence she would often leave the house just to keep away from him during the day.  As mentioned earlier, it is common ground that the parties were separated as from 20 November 1996 until 27 December 2006. 

17.     The evidence, therefore, as to the relationship between the parties prior to that time is based on that of the Applicant, his wife and daughter.  While I found Mr Naiger to be somewhat vague in his evidence, I do not consider that the substance of it was shaken in cross-examination.  The evidence of his wife as to their relationship was specific and consistent under cross-examination. I consider that it should be accepted that they had, for all practical purposes, separated, and did not live together as a couple, as from about mid 1993 at the latest.  In the present case, in 1993 Mr Naiger was at home and not working and Mrs Naiger had recently ceased to work.  Their personal relationship was one of strong mutual antipathy.  On the evidence available before the tribunal, the more likely inference is that the parties had separated, although they lived under the same roof, as from about mid 1993.

What Interest Did Mr Naiger Have In the Vaucluse Property

18.     Mr Naiger contends that he had no proprietary interest in the Vaucluse property.  This is supported by evidence from Mrs Naiger and also from their daughter, Olga Guliev.  By 1993 the evidence is that Mr and Mrs Naiger had separate bank accounts, incomes and finances. 

19.     In 1993 Mrs Naiger was offered a redundancy which she accepted and left work.  She received termination payments to a total of $87,325.00, and by 31 July 1993 she had savings of about $108,000.00 in an account in her own name.  In July 1993 she applied for an age pension on the basis that she was separated from Mr Naiger.  Centrelink accepted that, on the evidence at the time, she was ‘separated’ from her husband and her application was successful.

20.     In late 1993 Mrs Naiger and her daughter, Mrs Guliev, began to look for properties to purchase. This was done in order to enable Mrs Naiger to apply her savings to the purchase of a property in which she, her daughter, her son-in-law, and their children could live.  Mrs Naiger and Mrs Guliev inspected a number of properties and finally settled on the Vaucluse property.  They paid a deposit and instructed solicitors to act on the purchase. 

21.     This course of conduct in seeking an additional property in which Mrs Naiger could live with her daughter, son-in-law and grandchildren is consistent with the fact that Mr and Mrs Naiger had separated as of 1993. 

22.     The evidence is that Mr Naiger had no desire to move to the eastern suburbs or to leave the Homebush property, and that he was not interested in the purchase of another property.  This is verified by the evidence of Mrs Guliev who said that Mr Naiger was not interested in, and had nothing to do with the purchase of the Vaucluse property.  As far as Mrs Guliev was aware, Mr Naiger did not consider anything in relation to the purchase of the property,  and did not come looking at properties with herself and Mrs Naiger.  Once the deposit had been paid, they persuaded him to come and look at the Vaucluse property.  She did not know why the Vaucluse property was purchased in joint names of Mr and Mrs Naiger, but states that it was purchased by Mrs Naiger so that she and her family would have somewhere to live together with Mrs Naiger. 

23.     Mrs Guliev says that she and her family lived at the Homebush property until January 1994 when the purchase of the Vaucluse property was completed, and then moved in to Vaucluse immediately thereafter.  After this date, Mr and Mrs Guliev paid outgoings on the Vaucluse property including mortgage instalments, rates, water rates and strata levies.  The evidence is that Mr Naiger made no payment in respect of any outgoings concerning the Vaucluse property at any time by way of land tax, rates or other expenses.  The scenario presented by Mrs Guliev is that after she and her family moved into Vaucluse, Mrs Naiger came there every day from Homebush to look after the children. This arrangement became too onerous due to the considerable travel involved, and gradually Mrs Naiger spent more and more time at Vaucluse.  After a few years she hardly ever went back to Homebush.  I accept the evidence of Mrs Naiger and Mrs Guliev.

24.     Mrs Guliev and Mrs Naiger had paid off the entire mortgage on the Vaucluse property by 1998.  Mrs Guliev gave evidence that Mrs Naiger contributed money from the redundancy she received in 1993 when she ceased work, and also borrowed some money from friends to purchase the property.  There is no evidence to the contrary.  There is no evidence that Mr Naiger contributed to the purchase of the Vaucluse property, or assumed any obligation in respect of it. 

25.     The title to Vaucluse is in the joint names of Mr and Mrs Naiger. Mrs Naiger says that this was done because she did not think she could purchase the property in her sole name. She believed that because the Homebush property was in joint names, the Vaucluse property had to be as well.  Mrs Naiger is emphatic that Mr Naiger did not contribute to, or show any interest in, the Vaucluse property, nor was he interested in moving to the eastern suburbs.  It is apparent that Mr Naiger must have signed some documents but neither he, nor Mrs Naiger, remember how or why that came about.  She verifies that immediately after the purchase of the Vaucluse property, Mrs Guliev and her husband paid all the outgoings including strata levies, rates and the mortgage.  Mr Naiger did not contribute anything to the outgoings because he was only getting a small income himself and had to pay for the Homebush property.  In 1995 Mrs Naiger began to receive compensation payments for internment by the Germans during the war, and these lump sum instalments contributed in part to enable her to reduce the mortgage on the Vaucluse property.

26.     In 1999 the Homebush property was sold and the balance of the proceeds split between Mr and Mrs Naiger.  Mrs Naiger was not aware of what Mr Naiger did with his share of the proceeds of the Homebush property, but thought that he gave some to their daughter, Mrs Guliev.  The Homebush property was sold in December 1999 in order to pay off the mortgage under some pressure from the National Australia Bank.  Settlement took place in December 1999 and the sale price was $350,000.00. Mr and Mrs Naiger each received $128,000.00 of the available proceeds, and the mortgage to the National Australia Bank was paid out in an amount of $57,250.00.  As a consequence of this sale, Mr Naiger was homeless and eventually lived with his sister Clara Raber at Bondi. 

27.     Although the property is registered in the joint names of Mr and Mrs Naiger, I am persuaded, based on the evidence presented, that it is more likely than not that no contributions were made towards the purchase price of the property, or towards any outgoings on the premises by Mr Naiger. Further, I am persuaded that all payments made in relation to the property were more likely than not paid by Mrs Naiger, or at her request.  Accordingly, I am not satisfied that Mr Naiger had any beneficial interest in the Vaucluse property at any material time in the present matter. 

Conclusion

28.     Having regard to the evidence and submissions made in this matter, I have reached the following conclusions:

a)As from May 1993 Mr and Mrs Naiger were separated and not living together as a couple within the meaning of section 4 of the Social Security Act 1991 (Cth). 

b)At no material time has Mr Naiger had any beneficial interest in the Vaucluse property.

29.     As a result of such findings, the decision under review is set aside and remitted to the Respondent for reconsideration.

I certify that the 29 preceding paragraphs are a true copy of the reasons for the decision herein of The Hon B Tamberlin QC, Deputy President.

Signed:....................[sgd]..............................................................
           Associate

Date/s of Hearing   25 August 2009
Date of Decision   4 December 2009           
Solicitor for the Applicant                Stephen Hodges Solicitor
Solicitor for the Respondent           Centrelink Legal Services Branch