Sheehan and Secretary, Department of Family, Community Services and Indigenous Affairs

[2006] AATA 612

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 612

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2006/69

GENERAL ADMINISTRATIVE DIVISION		)
Re		DAVID SHEEHAN

Applicant

And SECRETARY, DEPARTMENT OF FAMILY, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS   

Respondent

DECISION

Tribunal REAR ADMIRAL A R HORTON AO, Member

Date10 July 2006

PlaceSydney

Decision The decision of the Social Security Appeals Tribunal that Mr Sheehan cannot be paid arrears of Carer Payment is affirmed.  

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

Rear Admiral A R Horton AO, Member

CATCHWORDS

SOCIAL SECURITY – arrears of carer payment – claim for carer payment stated income from employment – income applied to calculation of carer payment – applicant  subsequently confirmed no employment for most of period – carer payment adjusted – applicant claimed arrears – payment of arrears refused vide relevant legislation – affirmed by SSAT –consideration of circumstances -  the decision under review is affirmed. 

Social Security (Administration) Act 1999 – sections 5, 68, 109, 110, 237

Acts Interpretation Act 1901 – section 28A

Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138

Secretary, Department of Family and Community Services v Rogers (2000) 104 FCR 272

Re Rowe and Secretary, Department of Family and Community Service [2004] AATA 1160

REASONS FOR DECISION

10 July 2006 REAR ADMIRAL A R HORTON AO, Member   

1.      This is an application by Mr David Sheehan (“the Applicant”) for review of a decision of the Social Security Appeals Tribunal (“the SSAT”) made on 29 November 2005 which affirmed a decision of a Centrelink Authorised Review Officer (“ARO”) of 3 November 2005 not to pay arrears of Carer Payment. 

2.      At a hearing before the Administrative Appeals Tribunal (“the Tribunal”), Mr Sheehan represented himself.  Ms P Sharma, an advocate of Centrelink Legal Services Branch represented the Secretary, Department of Family, Community Services and Indigenous Affairs (“the Respondent”).  The documents provided by the Respondent pursuant to section 37 of the Administrative Appeals Tribunal 1975 were taken into evidence as were a Centrelink letter of 15 May 2001 to Mr Sheehan (Exhibit A1), copy of a letter from Centrelink to Mr Sheehan dated 9 February 2001 with attached Information sheets relating to the Carer Allowance and Carer Payment (Exhibit R1) and the Respondent’s Statement of Facts and Contentions (Exhibit R2).

BACKGROUND

3.        In 2000, Mr Sheehan resigned from employment with the Public Trustee.  At about the same time, he separated from his wife, who has custody of their two children, and went to live with his mother.  On 23 March 2001 Mr Sheehan submitted a claim for Carer Payment and/or Carer Allowance.   He indicated that he currently was receiving income from part-time work for less than 20 hours per week at Lynch’s Florist, Homebush.   He recorded the amount received each week before tax and any deductions as $165.  On 15 May 2001, Centrelink advised Mr Sheehan by letter of the grant of carer payment from 9 February 2001 (the date on which Mr Sheehan had first contacted Centrelink in respect of such payment), the calculation of his regular payment being based on an annual income of $8,580. 03. 

4.        In the context of confirming informal advice in respect of $500 loans approved by Centerlink under the conditions of the Carer Payment protocols, Centrelink wrote to Mr Sheehan on 27 March 2002, 27 March 2003 and 2 April 2004, (and probably on a fourth occasion as Mr Sheehan advised there were four such payments) .  On the first two occasions, the letter noted that the regular payment was based on an annual income of $8,580.02.  In the third letter, the annual income was shown as $0.03 and further entry of $330.00 was recorded as “regular fortnightly earnings”, this latter amount translating to $8,580 annually.

5.        On 29 August 2005 a Centrelink debt prevention officer contacted Mr Sheehan in accordance with the Debt Prevention Management Project which calls for contact with a customer if there has been no income advice provided to Centrelink in the previous 12 months.  That revealed that Mr Sheehan had not worked since 13 November 2001.  His carer payment rate was accordingly adjusted from 29 August 2005, based on an annual income of $0.03.  On 28 September 2005, Mr Sheehan requested arrears of payment from 13 November 2001 to 29 August 2005.  This was refused by a delegate of Centrelink, the decision being affirmed by an ARO on 3 November 2005 and in turn the SSAT on 29 November 2005.

LEGISLATION

6.        Relevant provisions in this matter are contained in the Social Security (Administration) Act 1999 (“the Administration Act”):

“SECT 67
Person who has made a claim

(1)

Subsection (2) applies to a person if:      

(a)       the person has made a claim for a social security   payment; and
  (b)      either:
  (i)       the claim has been granted; or
  (ii)       the claim has not been determined.

(2)

The Secretary may give a person to whom this subsection applies a notice in writing that requires the person to do either or both of the following:

(a)      inform the Department if:
           (i)       a specified event or change of circumstances   occurs; or
           (ii)       the person becomes aware that a specified event                    or change of circumstances is likely to occur;
(b)      give the Department a statement about a matter that   might affect the payment to the person of the social         security payment.

(2)      …

SECT 68
Person receiving social security payment or holding concession
card

(1)

Subsection (2) applies to a person to whom a social security payment (other than utilities allowance or seniors concession allowance) is being paid.

(2)

The Secretary may give a person to whom this subsection applies a notice that requires the person to do either or both of the following:

(a)      inform the Department if:
           (i)       a specified event or change of circumstances   occurs; or
           (ii)       the person becomes aware that a specified event                    or change of circumstances is likely to occur;
(b)      give the Department one or more statements about a matter that might affect the payment to the person of the   social security payment.

(3)      …

SECT 108
Definition

In this Subdivision:

favourable determination means a determination under section 78, 85 or 85A.

SECT 78
Rate increase determination

If the Secretary is satisfied that the rate at which a social security payment is being, or has been, paid is less than the rate provided for by the social security law, the Secretary must:

(a)      determine that the rate is to be increased to the rate provided for      by the social security law; and
(b)      specify the last-mentioned rate in the determination.

SECT 109
Date of effect of favourable determination resulting from
review

(1)

If:

(a)      a decision (the original decision) is made in relation to a        person's social security payment; and
(b)      a notice is given to the person informing the person of the      original decision; and
(c)      within 13 weeks after the notice is given, the person    applies to the Secretary, under section 129, for review of        the original decision; and
(d)      the favourable determination is made as a result of the          application for review;

the favourable determination takes effect on the day on which the determination embodying the original decision took effect.

(2)

If:

(a)      a decision (the original decision) is made in relation to a        person's social security payment; and
(b)      a notice is given to the person informing the person of the      original decision; and
(c)      more than 13 weeks after the notice is given, the person       applies to the Secretary, under section 129, for review of the original decision; and
(d)      the favourable determination is made as a result of the          application for review;

the favourable determination takes effect on the day on which the application for review was made.

(3)      …

SECT 110
Date of effect of favourable determination

(1)

Subject to subsections (1A) to (11) (inclusive), if a favourable determination is made following a person having informed the Department of the occurrence of an event or change of circumstances, the determination takes effect:

(a)      on the day on which the person so informed the          Department; or
(b)      on the day on which the event or change occurred;

whichever is the later.

(1A)

If a favourable determination is made in relation to a person who has not reached pension age:

(a)      following the person's having informed the Department of      the occurrence of an event or change of circumstances;    and
(b)      because, in an instalment period of the person:
           (i)       there is a decrease in the amount of employment                   income that is earned, derived or received, or that                   is taken to have been earned, derived or received,             by the person; or
           (ii)       the person has ceased to earn, derive or receive,                    or to be taken to earn, derive or receive,   employment income;

the determination takes effect on the first day of the instalment period, or on the first day of the instalment period in which the person so informs the Department, whichever is the later.

(2)

Subject to subsection (2A), if a favourable determination is made following a person having given the Department a statement about a matter in accordance with a notice under section 67 or 68, the determination takes effect on the day on which the matter arose.”

EVIDENCE

7.        Mr Sheehan worked for the Public Trustee in a clerk type role for 36 years.  He tendered his resignation following an incident within that organisation.  He stated in evidence that whilst he accepted liability, he had no involvement in the incident; suffice that he left with only his superannuation benefits and no redundancy or equivalent benefits.   Community service followed a criminal charge.  His evidence was that resulting from those events, it was difficult to gain further employment; further he and his wife separated, and they remain in that situation to the present.  Resulting primarily from a Family Court agreement, as I understand it, his half of their home at Pymble was transferred to his wife, and he made other financial arrangements.   His superannuation “disappeared”.

8.        His children remained with their mother.  Now that he is on the full rate of carer payment he is able to cope with some of the expenses associated with seeing his children, which he does at weekends, occasionally taking them out.  He has a 1993 Toyota vehicle which makes this possible.  

9.        After the break up of his family, he moved in with his 83 year old mother, who not many months before had been widowed.  She is on the age pension, not in the best of health and with very poor eyesight.  He was uncertain as to whether she is in receipt of a blind pension or part thereof, but she needs his help to complete returns and documents as may be required, as well as to travel to medical appointments and the like.    He assumed she had no problems in coping with this requirement in the past, either by herself or with the assistance of her late husband.

10.      In about July 2000, Mr Sheehan applied for, and was granted Newstart Allowance.  A friend subsequently offered him part-time employment at Lynch’s Florist, under the conditions previously referred to.  Early the following year he approached Centrelink with a view to claiming carer payment; this and carer allowance being granted to date 9 February 2001.

11.      In the course of the hearing, Mr Sheehan raised a number of concerns relating to the decision not to pay him arrears of carer payment for the period 13 November 2001 to 28 August 2005 and these are addressed in the following paragraphs.

12.     Mr Sheehan considered Centrelink to be “grossly negligent” in that the letter of 15 May 2001 approving carer payment and carer allowance did not clearly identify relevant issues and paid no regard to the fact that as a “new client” he should be accorded clear information and instructions.  That letter also made no reference to deductions that had been applied to the full rate of carer payment (although Mr Sheehan gave evidence that he had not known the full rate).  Had the letter done so, he would have been aware that an ongoing income through employment was being applied.   Further, he stated the notation on that original letter of 15 May 2001 which said “You can still receive carer payment if you are doing paid or voluntary work, studying or receiving training for up to 20 hours a week”, clearly implied there was no financial penalty.  His part-time employment was of only 5 hours on Sunday; whilst he had provided an earnings figure of $165 per week, Centrelink had no right to assume that an annual income could be calculated from that figure.

13.     As to the later periodic letters, Mr Sheehan stated in a letter to Centrelink Ettalong of 28 September 2005 (T13) that he did not recall receiving the letters of 27 March 2003 and 4 April 2004 (which I assume to be the letter of 2 April 2004), but he then indicates he found the former letter some short time later.  In evidence he stated that he did not really read these letters as they were primarily providing confirmation of $500 loans.He believed the annual income of $8,580.03 as shown on each letter (or $330 per week on that of 2 April 2004) was a reference to the annual carer payment (that initially being $318.20 per fortnight or $8273.20 annually).  He disputed the view of the ARO that whilst that may have been a (reasonable) assumption in the first year, it could not be upheld in later years as the pension payments increased in line with the consumer price index (e.g. being an annual amount of $10,036 from the carer payment noted in the letter of 2 April 2004).

14.     He had not read the detailed instructions given on these routine letters in respect of the occasions in which the customer must advise Centrelink of changes.  As shown at Exhibit A1, and unlike the computer formatted letter on file, the letter to the customer is in a more formal style on two pages.  The front page bears the highlighted notation “Please read the back of this letter”; the back of the letter defines the occasions on which Centrelink is to be contacted.  Mr Sheehan stated that whether one read the back or not, it was a matter of choice, and not mandatory nor a legal requirement.  If the intent was that it be mandatory, then the wording should have been along the lines of “You are required to read …”.

15.     Mr Sheehan further challenged the argument by the Respondent that he had received a “favourable determination” (in accordance with sections 109 or 110 of the Admin Act) on 29 August 2005 when his carer payment was recalculated on an annual income of just $0.03.  In his view, the determination was not favourable, but an adjustment to reflect what was his entitlement, and should have been his entitlement since he ceased work in November 2001.

16.     In the letter to Centrelink Ettalong of 28 September 2005 (paragraph 13), Mr Sheehan notes that when he asked Mr Greg Swanson (who had telephoned him when undertaking the debt prevention procedure) about arrears, “he said I suppose you could claim it” and in a later telephone conversation “I don’t like your chances”. Mr Sheehan referred to difficulties in speaking with a single person in Centrelink with authority; he questioned whether Ettalong had the authority to pay arrears, which he assumed had been implied in a letter of 21 October 2005 from the Manager of that office.  As the SSAT noted, this letter is a separate matter to those which required Mr Sheehan to advise Centrelink of changed circumstances; nonetheless, I observe, as did the SSAT, that its purpose and subject is quite unclear.  Suffice however, as I informed Mr Sheehan, his request for arrears of carer payment has subsequently been reviewed in accordance with the established and proper procedures.

17.     In summing up his reasons as to why arrears of carer payment should be paid, Mr Sheehan reiterated the issues previously addressed, in particular submitting that the original letter granting his carer payment had insufficient detail to enable him to ascertain the basis on which the payment was calculated.  This also applied to later letters.  He was unable to ascertain whether or not any deduction had been applied.  There was no legal requirement for him to read all facets of these letters, hence he had no knowledge of what and when he was to advise Centrelink.  He had not received a “favourable” decision, merely a restoration of what was his rightful payment rate.  Finally, he found it unacceptable that in the event of an overpayment, there was no financial loss to the recipient, and in some cases, such overpayment was written off or waived; that situation was at odds with that of an underpayment, where there seemed no right of recovery.

18. The Respondent submitted that section 110, or in the alternative section 109 of the Administration Act was very clear as to the date of effect of a favourable decision. Section 108 defines favourable determination and the section under which it might apply. Section 110 states that if a favourable determination is made following a person informing the Department of change of circumstance then the determination takes effect on the day the Department was informed (29 August 2005 in this matter) or the date of the change occurring (13 November 2001 in this matter ) whichever is the latter.

19.     The Respondent conceded that there might be shortcomings in some Centrelink letters but that would depend on the view of different customers.  Suffice that the letters sent to Mr Sheehan conveyed a decision and provided adequate advice and direction.  The Respondent referred to Secretary, Department of Family and Community Services v Rogers (2000) 104 FCR 272, Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138 and Re Rowe and Secretary, Department of Family and Community Services [2004] AATA 1160 in support of this contention. That Mr Sheehan chose not to read the letters in full, but did so selectively, and in the face of the advice to “Read the back…” was not the fault of the Respondent.  In accordance with relevant legislation, all the relevant letters were deemed to have been received by Mr Sheehan, who in turn had confirmed this had been the case.

CONSIDERATION

20.      I have no doubt that Mr Sheehan was experiencing severe emotional and financial difficulties following the loss of his employment and the implications that followed for future employment, and the break-up of his family. Nonetheless, and particularly given his experience over many years in a clerk type role, I find it somewhat odd that he sought to move from Newstart Allowance to the more beneficial and less stringent Carer Payment/Carer Allowance, yet claims he showed no interest in establishing the payment rates of the latter.  His evidence is that he did not investigate the conditions and rates for payment of carer payment, and hence had no idea as to whether he was being paid at the full rate or whether deductions had been made.   

21.     His evidence was also that in May 2001, Centrelink should have paid particular regard to the fact that he was a “new client”.   He was not a “new client” at that time, having been in receipt of Newstart Allowance since about July 2000.  Little  paperwork in that regard was before me, but he would no doubt have been in receipt of standard formatted letters from Centrelink in respect of that allowance, such letters advising the conditions of payment and the circumstances requiring him to contact Centrelink.

22.     He chose to ignore the advice on the letters he received from Centrelink advising him to “Please read the back of the letter”.  His argument that the wording had no obligatory or legislative basis, and therefore he did not need to read the document, is artful;   in no way would it preclude a prudent person, particularly one with many years of clerical/office experience, from ascertaining the conditions relevant to the social security benefit he was being paid.  Mr Sheehan also gave evidence that he did not see the need to read the letters relating to the periodic $500 loans in any detail, as they merely confirmed those loans.  His further evidence is that the wording in the letters was not clear to him, yet he made no attempt over a 4 year period to ascertain the conditions of his carer payment. 

23.     He has referred to the statement on the original letter of 15 May 2001 that he could still receive carer payment if “doing work…up to 20 hours a week”, as confirmation that a full rate would be paid in those circumstances.  However, he made no attempt to confirm that his interpretation was correct.   Nor did he pursue the evident discrepancy in respect of his argument that he understood the annual income figure of $8,580.03 ($330 per week on 2 April 2004) was the amount of carer payment he received each year; the figures provided by the Respondent, as detailed in paragraph 13 above, clearly show the increasing differential each year as the carer payment was increased (to $10,036 in 2 April 2004) to take account of application of the consumer price index.   I presume that Mr Sheehan was aware of these periodic quantum increases in carer payment, which should have alerted him to the increasing gap between payment rate and the $8,580.03 income figure.

24.      The SSAT decision observes that Mr Sheehan argued that the Centrelink letters were not notices because they did not adequately notify him that income from employment was being used to calculate his payment.  As I have observed above, similar criticism was made before me.  The issue of what is a notice, and what should it contain was addressed by Drummond J in Re Austen (supra) and Cooper J in Re Rogers (supra), the view of their Honours in both cases being similar in that a clear and intelligible statement to the effect that a decision has been made is required to establish that a “communication can constitute a notice” (Drummond J in Austin at 36).

25.      As to whether any relevant legislation requires the notice to contain reasons or sufficient information for the recipient of the notice to understand the main reason for the decision and so be in a position to exercise a right to seek a review, Cooper J stated at 33:    “the subsections make no reference to any requirement”, and nor “in my view, do any principles of procedural fairness require that such a requirement be read into the provisions of section 299”  (as relevant to the matter before him).

26.      I note also, and follow, the decision in Re Rowe (Supra) where the Senior Member relied on the decisions in Austin (supra) and Rogers (supra) in that they found “that there is no obligation of the Respondent to do more than communicate the making of a decision.  The Respondent does not have to explain the reasons for the decision …”. In the matter before me, the various letters from Centrelink as previously referred to contained clear decisions in respect of the granting of carer payment, the rate of such payment, and the confirmation of advances (loans) where appropriate.  

27. There was no argument put to me that letters had not been received, although that had been stated, in the case of two letters, subsequently amended to one, in the letter from Mr Sheehan to Centrelink on 28 September 2005. For completeness, the legislation is quite clear, and case law has affirmed, that delivery of a letter can be assumed if the location and address of the recipient is known, and the notice of a decision is sent by prepaid post to the postal address. Section 237(1) of the Administration Act and section 28A of the Acts Interpretation Act1901 are relevant. 

28.      The carer payment rate for Mr Sheehan was adjusted on 29 August 2005 to the full rate after it was ascertained that he was no longer earning income.  Whilst Mr Sheehan is firmly of the view that this adjustment was not “favourable” in that he was subsequently paid at the correct rate, vide sections 108 and 78 of the Administration Act, the decision meets the criteria of “favourable determination”. As such, the Respondent correctly applied the provisions of section 110 of the Administration Act in that the determination takes effect on the day Mr Sheehan informed the Department of the change of circumstances (subsection 110(a) being relevant), ie that he was earning no income, this being the 29 August 2005. The legislation provides no latitude or flexibility in this matter.

29.      On the evidence before me, Mr Sheehan has to accept responsibility for failing to meet the criteria placed upon him to ensure that a lack of understanding of the processes or changes in circumstances are brought to the notice of Centrelink in a timely fashion.  Whilst it can be argued with some merit that the details in the  decision letters from Centrelink may at times not be as clear as a customer might wish, the requirement to advise Centrelink of concerns or if the decision is not agreed, as well as in numerous other instances of change, is clearly stated.   This Mr Sheehan failed to do, and as a result he was paid at an incorrect rate until his lack of earnings was brought to the notice of Centrelink.  In the circumstances, and in accordance with the legislation, arrears of care payment cannot be paid.

30.      The decision under review is affirmed.  

I certify that the 30 preceding paragraphs are a true copy of the reasons for the decision herein of REAR ADMIRAL A R HORTON AO, Member

Signed:         Associate

Date of Hearing  22 June 2006 
Date of Decision  10 July 2006
Representative for the Applicant               Mr D Sheehan, Self-Represented 
Advocate for the Respondent                    Ms P Sharma,
  Centrelink Legal Services Branch