Silvestri and Secretary, Department of Family and Community Servi Ces
[2003] AATA 142
•14 February 2003
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2003] AATA 142
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2002/812
GENERAL ADMINISTRATIVE DIVISION ) Re ENZO SILVESTRI Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Dr E K Christie, Member Date14 February 2003
PlaceBrisbane
Decision The Tribunal affirms the decision under review. This means Mr Silvestri's application for review is unsuccessful.
(Sgd) Dr E K Christie
Member
CATCHWORDS
SOCIAL SECURITY – benefits and entitlements - newstart allowance - overpayment - whether debt due to Commonwealth should be waived – whether "administrative error" - whether “special circumstances" - meaning of "full-time course of education"
Social Security Act 1991
Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Secretary, Department of Social Security v Jordan (1998) 49 ALD 496
Re L and Secretary, Department of Social Security (1995) 21 AAR 412Re Secretary, Department of Family and Community Services and Radmilovich [2002] AATA 779
REASONS FOR DECISION
18 February 2003 Dr E K Christie, Member 1. This is an application by Enzo Silvestri for a review of a decision of the Social Security Appeals Tribunal (“the SSAT”), made on 22 August 2002, to raise and recover a Newstart Allowance (“NSA”) debt in the sum of $3,527.54 for the period 13 February 2002 to 3 June 2002.
2. At the hearing the applicant, Enzo Silvestri represented himself. The respondent was represented by Mr T Ffrench, a Departmental Advocate.
3. At the hearing the Tribunal had in evidence before it documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, the “T” documents (Exhibit 1), and the various documents tendered by the parties.
4. The SSAT made the following finds of fact:
(i)At all material times, Mr Silvestri was in receipt of Newstart Allowance.
(ii)In Semester 1, 2002, he was enrolled on a full-time basis in a course of education at the University of Queensland.
(iii)On various Newstart Allowance application forms lodged with Centrelink in the relevant period, he failed to advise of his full-time enrolment status and the details of the study he was undertaking.
5. At the commencement of the hearing, Mr Silvestri conceded the first and third findings of fact made by the SSAT but disagreed with the finding that he was enrolled on a full-time basis in a course of education at the University of Queensland in Semester 1, 2002.
Issues to be Decided
6. The key issue for the Tribunal to decide is whether Mr Silvestri was entitled to NSA for the period 13 February 2002 to 4 June 2002. If Mr Silvestri was not entitled to NSA over the period, the next issue for the Tribunal to decide is whether there is a debt owed to the Commonwealth which is recoverable.
Evidence of Enzo Silvestri
7. Mr Silvestri said that he was in receipt of NSA from August 2001, as at this time he was seeking work as a teacher of ESL.
8. Before resuming tertiary studies in Semester 1, 2002, and in order to complete his Bachelor of Arts/Bachelor Education Studies (Graduate Entry) program, Mr Silvestri said that he went to the Nundah office of Centrelink in January 2002 to lodge a claim for Austudy. He said that he informed the Centrelink officer that he was to complete two units in the curriculum area in 2002 (“curriculum subjects” EDUC 4002; EDUC 4051) and two units of [teaching] practical (EDUC 4029). He had stated to the Centrelink officer that the two “curriculum subjects” involved a maximum of ten hours teaching contact per week.
9. Mr Silvestri said that the Centrelink advice he received was that the ten hours contact was under the minimum hours for Austudy and he would be better off fulfilling his obligations under NSA as he would be able to hold a full-time job if one was offered to him.
10. Thereafter, Mr Silvestri said that he continued to receive NSA fortnightly forms. He did not complete the questions about study situations as he assumed that they were only available for unemployed people who were sponsored to study special courses. He further assumed that these questions did not apply to him as he was doing a regular degree course that he had arranged independently of Centrelink. As well, that he had continued looking for full-time work.
11. Mr Silvestri stated that he did tell Centrelink counter staff that he was studying, at various times, when lodging NSA fortnightly forms.
12. Mr Silvestri said that he commenced full-time work at the Hilton International College on 21 June 2002.. He stated that the nature of the work undertaken at the College did not interfere with his tertiary studies throughout the remainder of 2002.
13. Mr Silvestri clarified for the Tribunal that the two units of teaching practicuums involved two 7 week practicuums and that he was required to participate Monday to Friday of each week throughout the practicuum.
14. Mr Silvestri said that he had now graduated, but was driving a cab whilst awaiting a teaching placement with the Education Department.
15. During cross-examination, Mr Silvestri acknowledged that he may not have made it clear to Centrelink officers about the subjects he was studying with respect to the full-time status requirements of the curriculum subjects and the units of teaching practicuum. He stated that the Centrelink officers may have assumed that the practicuum was connected with the ten hours per week of the curriculum subjects. However, Mr Silvestri said that he was “not sure” whether the distinction had been explained to Centrelink.
16. In response to a further question during cross-examination that there was no Centrelink record of his inquiry at the Nundah office in relation to eligibility for Austudy/NSA, Mr Silvestri stated that there had been no formal interview. Rather an across the counter inquiry had been made.
17. Mr Silvestri said that statements attributed to him held in Centrelink records (T10 Folio 49, T12 Folio 60) that he had been told by Centrelink to claim for Austudy, and not NSA, were incorrect.
18. Mr Silvestri conceded during cross-examination that his University of Queensland Student Card had a full-time student endorsement.
19. In response to a number of Tribunal questions, Mr Silvestri stated:
(a)that he had returned to Australia after working in Korea at the end of 2001 and sought advice from the University of Queensland as to the requirements for completing his BA/B Educ program. He said that the Dean had told him that “he would be a full-time student as far as the University was concerned”.. However, he told the Tribunal that he saw no reason to clarify the meaning of this statement made by the Dean.
(b)following the information he had received from Centrelink that his ten hours of contact did not qualify him for the Austudy requirement for full-time study, that he did not seek any follow-up advice from the Dean’s office. That is, to reconcile the Centrelink information with the Dean’s advice that he would be a full-time student.
Contentions and Submissions of the Parties
20. Mr Ffrench submitted that the University of Queensland had determined that Mr Silvestri was a full-time student in Semester 1 and Semester 2, 2002 (T7, Folio 25). Accordingly given this enrolment status, Mr Silvestri was not eligible for NSA as he could not satisfy the activity test as he was not available to work as required due to his study commitments – particularly because of his full-time teaching practicuums in each semester (two units of 7 weeks).
21. Mr Ffrench contended that because he was a full-time student and so not entitled to NSA, Mr Silvestri was not entitled to the NSA payments received from 13 February to 4 June 2002. Consequently, these entitlements received were a debt due to the Commonwealth and so could be recovered.
22. Mr Ffrench submitted that the debt could not be waived under “administrative error” provisions of the Social Security Act 1991 because Mr Silvestri had contributed to the error which led to the overpayment. Mr Silvestri failed to advise Centrelink that he was enrolled as a full-time student at the University of Queensland in Semester 1, 2002.
23. Mr Ffrench further submitted that the debt could not be waived under the “special circumstances” provisions of the Social Security Act 1991 because Mr Silvestri had knowingly contravened a section of the Act. Specifically, his failure in answering Question 8 of the fortnightly NSA forms, in relation to whether he was undertaking full-time or part-time study (see T8 Folio 29, 26 February 2002; T8 Folio 31, 14 March 2002; T8, Folio 33, 38 March 2002).
24. Furthermore, it was Mr Ffrench’s contention that there was nothing “unusual, uncommon, or exceptional” in the facts of Mr Silvestri’s application for review that warranted the description of “special circumstances”, to enable the debt to be waived under the “special circumstances” provisions of the Act.
25. Mr Ffrench also submitted that the debt could not be “written off” as there was no evidence before the Tribunal that Mr Silvestri did not have any capacity to repay the debt.
26. Finally, it was Mr Ffrench’s contention that notwithstanding that Mr Silvestri may have been entitled to Austudy in Semester 1, 2002 (his “notional entitlement”), section 1237 AAC (5) of the Act did not apply to Austudy and so the actual debt due to the Commonwealth could not be the difference between the Austudy payments Mr Silvestri was entitled to and the NSA payments he received.
27. Mr Silvestri submitted that he was entitled to receive NSA as he was not a full-time student, as he had undertaken part-time study in Semester 1, 2002. He submitted that the overpayment would not have arisen if he had not been given erroneous advice by the Nundah office of Centrelink in January 2002.
28. Mr Silvestri submitted that he had not applied for Austudy, as the Centrelink advice he had received was to not apply for Austudy, but to apply for NSA.
29. Mr Silvestri acknowledged that the total fault for overpayment of NSA could not be attributed solely to him as the initial problem had been created by the Centrelink officer at the Nundah office. Thereafter, he may have contributed to the problem because of “confusion or unsureness of how to proceed”.. However, he submitted that none of his actions could be in any way interpreted as an intention to defraud the Commonwealth. In addition, he had fulfilled all of his obligations as a NSA recipient, including taking the first job that he was offered.
30. Mr Silvestri said that any liability to repay the debt should be shared between him and Centrelink, as Centrelink had also contributed to the administrative error.
31. Mr Silvestri concluded that the debt to be recovered should be offset by the Austudy that he would have been eligible for, if he had been advised differently.
Considerations of the Issues
32. The objective of the Tribunal is to review administrative decisions on their merits but in accordance with the law at all times. The relevant legislation is the Social Security Act 1991 (“the Act”).
33. Section 1237 of the Act provides for circumstances where a debt due by a recipient of social security to the Commonwealth, may be waived:
“1237A – Waiver of debt arising from error
1237A(1) Administrative error. 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.
Note:Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).
…
1237AAD – Waiver in special circumstances
1237AAD The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii) failing or omitting to comply with a provision of the Act or the 1947 Act; and
(b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c)it is more appropriate to waive than to write off the debt or part of the debt.”
34. Waiver for “special circumstances” requires consideration of the meaning of the terms “knowingly” and “special circumstances” as applied by the Tribunal in other cases it has decided.
35. The meaning of the term “knowingly” has been considered by the Tribunal in Re Callaghan and Secretary, Department of Social Security (1996) 45 ALD 435 where Deputy President Forgie stated (at 445):
“There is nothing in s 1237AAD which suggests that the word ‘knowingly’ should be given any meaning other than that a person has actual knowledge, rather than constructive knowledge, that he or she is making a false statement or representation or that he or she is failing or omitting to comply with a provision of the Act. That actual knowledge is to be ascertained by reference to the statements of the person as to his or her actual state of knowledge at the time and to events surrounding the false statement or the act of or omission.”
36. The leading case with respect to the meaning of “special circumstances” is Re Beadle and Director-General of Social Security (1984) 6 ALD 1 where the Tribunal said (at 3):
“An expression such as ‘special circumstances’ is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual; uncommon or exceptional. Whether circumstances answer any of these descriptions must depend upon the context in which they occur. For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.”
37. Section 1236 of the Act contains provisions that must be satisfied for a debt due to the Commonwealth to be written off:
“1236 Secretary may write off debt
(1)Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.
(1A)The Secretary may decide to write off a debt under subsection (1) if, and only if:
(i) the debt is irrecoverable at law; or
(ii) the debtor has no capacity to repay the debt; or
(iii) the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
(iv) the debtor is not receiving a social security payment under this Act and it is not cost effective for the Commonwealth to take action to recover the debt.”
38. The first issue for the Tribunal to decide is the enrolment status of Mr Silvestri in Semester 1, 2002, that is his BA/BEduc Program at the University of Queensland. The meaning of “full-time course of education” was considered by the Federal Court in Secretary, Department of Social Security v Jordan (1998) 49 ALD 496, where at 502,503 Hill J commented:
“The classification of the course by the educational institution offering it is a factor to consider; indeed it may provide at the least a prima facie indication and perhaps often will, absent other factors, determinative. But that classification can not be the only factor to be considered…
Other relevant facts will include the number of hours the student is required to attend the university, the number of hours expected to be spent working at home on study and assessments and the times and days the student is required to attend the university. The task of statutory interpretation, however, is not to define an expression in the abstract. The context in which the expression is employed will cast light on the meaning which parliament intended. In the present case the context is that of conferring upon unemployed applicants a benefit where they are seeking work. An applicant who is enrolled in a full time course of educational or vocational study is to be regarded as not able to participate in the full time work force and thus disentitled to the benefit. Hence in construing the expression ‘full time course of education’ it will often be relevant to consider whether the course is so structured that it would be inconsistent with the ability of the applicant to become engaged in full time employment.”
39. The Tribunal has applied the reasoning in Jordan’s case and finds:
(a)that the University of Queensland had determined Mr Silvestri’s enrolment in Semester 1, 2002 was that of a full-time student (T7, Folio 25). Mr Silvestri had been advised of this fact by the Dean of Student’s card by the University with a full-time endorsement;
(b)this classification of the University as full-time needs to be considered against teaching contact hours, together with work undertaken outside formal contact hours that was directly related to Mr Silvestri’s degree studies;
(c)that the timetabled teaching contact, (lectures, tutorials) for curriculum subjects in Semester 1, 2002, at the University, was Monday (9.00am–10.00am, 5.00pm–7.00pm); Wednesday (5.00pm–7.00pm); Thursday (3.00pm–6.00pm) and Friday (2.00pm–4.00pm). In addition, his teaching practicuum, at a school, in Semester 1, 2002 was for a seven week period involving five days each week;
(d)That the curriculum subjects and teaching practicuum all involved further time outside formal contact hours, working at home on study, completion of course assessment items and preparation [for the practicuum].
40. Considering all of the above elements as specified in Jordan’s case, the Tribunal can make no other conclusion but to find that Mr Silvestri was enrolled in a full-time course of educational study. His course of study was structured in such a way that it would be inconsistent with his ability to participate in the full-time work force in Semester 1, 2002. Given this finding, Mr Silvestri was not entitled to NSA in Semester 1, 2002 so that the NSA payments he received over the period 13 February 2002 to 4 June 2002 is a debt due to the Commonwealth that can be recovered.
41. The next issue for the Tribunal to decide is whether the debt can be waived under the “administrative error” provisions of the Act.
42. The Tribunal concludes that the debt cannot be waived for “administrative error” because Mr Silvestri has contributed to the error that led to the NSA overpayment by failing to correctly advise Centrelink that he was a full-time student. Mr Silvestri was aware, through the Dean, that he had full-time student status at the University. Moreover, as a student enrolled in a graduate entry program, as well as a former recipient of Austudy, Mr Silvestri had opportunity over time to understand his position and any need to clarify his student status if he was uncertain, for example, through the University or when completing his fortnightly NSA forms. However, such clarification was not sought so that the overpayment problem persisted. Finally, Mr Silvestri conceded in his closing address that he may have contributed to the administrative error.
43. The next issue is for the Tribunal to consider is whether the debt should be waived under the “special circumstances” provisions of the Act.
44. The Tribunal concludes that Mr Silvestri’s circumstances were not “special”. As a former recipient of Austudy and a tertiary student enrolled in a graduate entry degree program, the Tribunal is satisfied that Mr Silvestri had the capacity to understand his situation and obligations as a social security recipient. However, he made no positive attempts, over time, through the avenues of assistance available to him (for example Centrelink, the University) to use them to know about, or to clarify, any uncertainty he may have had attached to those obligations – particularly as they related to the correct enrolment status in his degree studies. Accordingly, the Tribunal concludes that there are no “special circumstances” in the manner he managed his social security obligations that make it desirable to waive the debt. The Tribunal finds that there are no facts in Mr Silvestri’s case that warrant the description of “unusual, uncommon or exceptional”.
45. Provision of the correct advice in social security matters in order to ensure the correct entitlement is paid is a two way process involving both Centrelink and the social security recipient. In this application for review, Mr Silvestri has failed to ensure that Centrelink was correctly informed, from the outset, that he was enrolled in a “full-time course of educational study”.
46. The Tribunal has considered the write off provisions of the Act and applied the reasoning of Mathews J in Re L and Secretary, Department of Social Security (1995) 21 AAR 412 and concludes that there is no evidence before the Tribunal that recovery of the debt would cause such personal hardship to Mr Silvestri as to run contrary to the beneficial nature of the Social Security Act.. Consequently, the Tribunal finds that the debt due to the Commonwealth cannot be written off.
47. Finally, the Tribunal has considered the submissions of Mr Silvestri given the likelihood that he would have been eligible for Austudy in Semester 1, 2002, that the debt should be offset. That is, the NSA overpayments should be reduced by his notional Austudy entitlements. The ability to offset one entitlement against another was considered in the Tribunal recently in Re Secretary, Department of Family and Community Services and Radmilovich [2002] AATA 779. In that case, the respondent received a Widow Allowance to which she was not entitled, although she was notionally entitled to receive unemployment benefits. The Tribunal held that she could not offset the entitlement to a Newstart Allowance against the debt. Therefore the Tribunal concludes that, in this case, the fact that Mr Silvestri may have been entitled to Austudy during the period of the overpayment, is not a relevant consideration.
48. Furthermore, the Tribunal has also considered the provisions of the Act (s 1237AAC) that expressly provide for waiver, and offsetting of entitlements where a debtor would have been entitled to an allowance. However, these provisions do not apply to Austudy payments.
49. For all of the above reasons the Tribunal decides that the decision under review is affirmed. This means that Mr Silvestri’s application for review is unsuccessful. The Tribunal directs the respondent to ensure that the instalments for recovery of the overpayment be determined in conjunction with Mr Silvestri and based on a statement of financial circumstances provided by Mr SiIvestri.
I certify that the 49 preceding paragraphs are a true copy of the reasons for the decision herein of Dr E K Christie, Member
Signed: .......................................................................................
AssociateDate of Hearing 17 December 2002
Date of Decision 18 February 2003
The Applicant appeared in person
For the Respondent Mr T Ffrench, Departmental Advocate
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