Soriano and Department of Family and Community Services
[2000] AATA 842
•20 September 2000
DECISION AND REASONS FOR DECISION [2000] AATA 842
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q00/168
GENERAL ADMINISTRATIVE DIVISION )
Re JORGE SORIANO
Applicant
And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Dr EK Christie, Member
Date20 September 2000
PlaceBrisbane
Decision The Tribunal sets aside the decision under review and in substitution therefor the Tribunal decides to waive the whole of the debt accrued over the period 1 May 1998 to 30 May 1999, under the "special circumstances" provision of the Social Security Act 1991. The waiver is to take effect on 1 June 1999. This means Mr Soriano's appeal is successful.
(Sgd) EK CHRISTIE
MEMBER
CATCHWORDS
SOCIAL SECURITY - assurance of support - debt - Departmental guidelines not followed - waiver - whether special circumstances exist.
Social Security Act 1991 ss 1236, 1237A, 1237AAD
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Department of Social Security and Bosworth (1989) 18 ALD 373
REASONS FOR DECISION
20 September 2000 Dr EK Christie, Member
This is an application by Jorge Soriano to review a decision of the Social Security Appeals Tribunal ("the SSAT") made on 9 February 2000 to raise and recover an "Assurance of Support" debt totalling $18,213.47 for the period 1 May 1998 to 30 May 1999. The debt relates to "special benefits" paid to Maria Flores ($9,269.67) and Oscar Flores ($8,943.80). The SSAT decision affirmed an earlier decision made by Centrelink on 15 September 1999.
In reaching its decision, the SSAT decided that Mr Soriano's overall circumstances could not be found to be special under the provisions of the Social Security Act 1991 and therefore the debt could not be waived.
The applicant was represented by Miss C Heyworth-Smith of Counsel instructed by the Welfare Rights Centre Inc. The respondent was represented by Mr R McQuinlan, a Departmental Advocate.
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 following exhibits:
Exhibit 2 Statement of Financial Circumstances, Jorge Soriano – 18.4.00
Issues before the Tribunal
The only issues for the Tribunal to decide were:
whether there was a debt due to the Commonwealth; and
whether the debt should be waived under the "special circumstances" provisions of the Social Security Act.
Facts
The general facts were not in dispute and may be stated briefly. Mr Soriano and his wife decided to bring his parents to Australia. On 1 October 1996, he and his wife signed an Assurance of Support Agreement and deposited a bond of $5,000 in connection with the Assurance of Support.
The Assurance of Support covered a two year period commencing 31 May 1997, the date that Mr and Mrs Flores were granted permanent entry to Australia.
Mr and Mrs Flores stayed with the Sorianos when they first arrived in Australia. However, about twelve months after they arrived Mr and Mrs Flores moved out without advising Mr Soriano.
Mr and Mrs Flores were subsequently granted special benefit from Centrelink, having applied on 1 May 1998 (Document T12).
Mr Soriano was not informed, three monthly, as required by Departmental Policy, of the accruing special benefit debts arising from the receipt of special benefits by his parents (Centrelink Authorised Review Officer, Document T26 Folio 109).
The debt is currently being recovered at $20 per fortnight. At the date of the hearing the residual balance was $12,833.47.
Evidence of Jorge Soriano
Mr Soriano and his family arrived in Australia from El Salvador, as refugees, in February 1987. Although he had a university degree in mechanical engineering, language difficulties on arrival meant he could only find employment as a process worker. He had been employed as a press operator at the same workplace for 10 years.
Mr Soriano's parents arrived in Australia, from New York, in May 1997. Mr Soriano said that he was aware that the $5,000 bond he had deposited with Centrelink, in order to prove financial support for his parents for the first two years, could be used to cover the costs should his parents go on to special benefits. However, Mr Soriano said that no interview had taken place between himself and his parents where they were advised of the consequences of the Flores receiving special benefits payments whilst the Assurance of Support was effective.
Mr Soriano said that complaints over small domestic issues commenced a few months after his parents moved into his home. Ultimately, his parents moved out of his home about twelve months after arriving in Australia. However, he was unaware that his parents had moved out until he arrived home from work, one day, to find their room empty. He had no idea where his parents had moved to until some four to six months later. Throughout this period, he had no contact with his parents; nor had he any idea what his parents were doing.
Furthermore, Mr Soriano had no contact with Centrelink until Centrelink had asked him whether they could use the $5,000 bond. Mr Soriano agreed to this request but was still not informed by Centrelink where his parents lived.
During cross-examination, Mr McQuinlan referred to the Statutory Declaration Mr Soriano had signed in the Assurance of Support application he had completed (Document T5 Folio 43); in particular, Clause 1 where Mr Soriano agreed he knew that if Commonwealth funds, such as special benefits, were paid to his parents that he may have to pay the money back. However, Mr Soriano stated that he believed that the surrender of the $5,000 bond would cover the debt caused by his parents being granted special benefits. It was also Mr Soriano's belief that his parents understood that there would be no further debt.
Mr Soriano said that if he had been made aware of the actual debt situation as it accrued over time, he could have taken alternative actions for dealing with the problem. For example, by seeking assistance in the form of housing for his parents from his network of friends – such as the many Australian families who had sponsored him as a refugee.
Legislative FrameworkSection 729(1) of the Social Security Act 1991 ("the Act") provides that a person is qualified for a special benefit for a period if the Secretary determines, in accordance with sub-section (2), that a special benefit should be granted to the person for the period. Where all of the factors listed in sub-sections (a) to (fa) of subsection 729(2) of the Act are fulfilled, the Secretary may, in his or her discretion, determine that a special benefit should be granted to a person for a period. Subsection 729(3) provides that the Secretary is not to determine that a special benefit should be granted to a person for a period if the Secretary is satisfied that the benefit is not payable to the person for that period.
Section 732 provides that "even though a person might be otherwise qualified for a special benefit, the benefit might not be payable to the person because ….(da) the person is subject to a newly arrived residence waiting period and that period has not ended".
Section 1237AAD of the Act provides for circumstances where a debt due by a recipient of social security to the Commonwealth, may be waived 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 this 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."
Contentions and Submissions of the Parties
Miss Heyworth-Smith submitted that Mr Soriano was not liable to pay an Assurance of Support debt as special benefits were not payable to Mr and Mrs Flores. Miss Heyworth-Smith contended that, notwithstanding the fact that special benefits were paid to the Flores, this did not make them "payable" within Regulation 2.38 of the Migration Regulation 1994.
Miss Heyworth-Smith then referred to the Departmental Policy Guidelines (Document T7) commencing with paragraph 15.2120 (Folio 58):
"If a claimant for special benefit (SpB) in the newly arrived residence waiting period is sponsored…he or she must have made every effort to get adequate support from their sponsor before SpB. A significant change in circumstances could include, but is not limited to the following circumstances…."
Miss Heyworth-Smith then referred to the circumstances specified in paragraph 15.2120 which may amount to a significant change in circumstances. She contended that whilst the list was not exhaustive, it did not contain a reference to breakdown of the relationship (short of documented domestic violence) with the sponsor or a member of the sponsor's household.
Miss Heyworth-Smith then referred to paragraph 1.9300 of the Departmental Policy Guidelines (Document T7 Folio 54) which applied where a claimant for special benefit was the subject of an Assurance of Support. She submitted that one of the relevant factors was where the claimant did not wish to continue living in the same household. Another factor was where the relationship between the claimant and the assurer or the assurer's family had broken down an conditions had become unacceptable. Moreover, this Guideline provided procedures and guidance as to what should be done when the stories of the assurer and the assured conflict. However, notwithstanding the existence of these Police Guidelines, none of the procedures set out in the Guidelines were followed in Mr Soriano's circumstances.
Miss Heyworth-Smith submitted that one of the consequences of failing to follow the procedures set out in the Departmental Policy Guidelines was that there was no evidence to support a contention that the two year waiting period should have been waived because there had been "a substantial change in circumstances beyond the [assured's] control". She contended that the material was to the contrary because:
it was Mr Soriano's parents who moved out, without telling Mr Soriano they were doing so;
Mr Soriano never refused to provide them with support in accordance with an obligation to do so;
Mr Soriano's evidence was that he was quite prepared and able to continue to support is parents; and
on Mr Soriano's evidence, any friction in the household had a great deal to do with Mr and Mrs Flores' attitude to Mrs Soriano – a circumstance entirely within their control.
Miss Heyworth-Smith contended that there had been no significant change in circumstances as any change that had occurred was beyond Mr Soriano's control. As a consequence, special benefits were not payable to Mr and Mrs Flores. The fact that special benefits were paid did not make them "payable" within Regulation 2.38 of the Migration Regulations 1994. Accordingly, there was no debt payable to the Commonwealth within Section 1227 of the Social Security Act 1991.
Miss Heyworth-Smith submitted that if a debt was due to the Commonwealth, then it should be waived under the "special circumstances" provisions of the Act. Miss Heyworth-Smith then referred to the Departmental Policy Guidelines which specified the need for both parties to understand their potential obligations under the Assurance of Support. Miss Heyworth-Smith stated that the only Departmental investigations carried out were those referred to in the "File Notes" (Documents T9 – T11). Miss Heyworth-Smith contended that these File Notes indicated (Document T10) that:
(a) Mr Soriano intended to provide support;
(b) that he did not want his parents to leave; and
(c) that his parents did have access to all facilities.
A note of a conversation with Mrs Soriano indicated that there was some friction, and that she wanted the Flores to go. The note-taker then says "There seems to be a lot of issues that have risen while talking to Betsy…I don't believe the assure[r] understands that they will lose there [sic] bond and may have an overpayment with us". Miss Heyworth-Smith further contended that there was nothing to indicate that these "issues" were addressed. Furthermore, at the time the special benefit was paid, that there was no attempt to ensure that Mr Soriano did understand that there may be "an overpayment".Miss Heyworth-Smith submitted that had the Departmental Policy Guidelines been followed there was every possibility:
that Mr Soriano's support would have continued to have been provided;
that counselling or mediation would have prevented or resolved any "breakdown in relationship" between Mrs Soriano and Mr and Mrs Flores; and
the payment of special benefits would not have taken place.
A further basis for justifying the waiver of the debt for "special circumstances" Miss Heyworth-Smith contended, was because:
there was no significant change in Mr and Mrs Flores circumstances to warrant payment of special benefits; and
any change which did occur was beyond Mr Soriano's control.
Mr McQuinlan contended that there was "ample reason" for the Department to pay special benefit to Mr and Mrs Flores. There was, he said, a "very clear case of family breakdown". Mrs Soriano had asked the Flores to leave their home. Mr Soriano had overheard his wife telling his parents to leave. However, his attempts to dissuade her were unsuccessful. Accordingly, Mr McQuinlan submitted that the Flores had no alternative other than to leave the Soriano's home.
Based on these submissions, Mr McQuinlan contended that this situation for the Flores represented a substantial or significant change in their circumstances. Consequently, there was a sound basis to support the Department's decision to pay special benefit to the Flores.
Mr McQuinlan acknowledged that it was "pretty clear from the material" that procedures contained in Departmental Policy Guidelines (Document T7; Document T20) "which ordinarily ought be applied weren't followed". However, Mr McQuinlan contended that such a failure to follow Departmental Policy procedures did not relieve Mr Soriano from either his debt or his "strict" obligation to repay that debt.
Mr McQuinlan said that Mr Soriano, in signing an Assurance of Support application (Document T5), had given a declaration to the Australian Government to repay to the Commonwealth any special benefits paid to the Flores during the two years for which the Assurance of Support was given.
It was Mr McQuinlan's further contention that the failure of Centrelink to inform Mr Soriano about the commencement of special benefit to his parents and the ongoing accruing debt, according to the Departmental Policy Guidelines (Document T20), did not relieve Mr Soriano of his strict legal obligations to meet undertakings he had given to the Australian Government. Furthermore, Mr McQuinlan submitted that Mr Soriano had proceeded on an assumption that the limit of his debt for repayment of special benefits paid to his parents would only be the $5,000 he had lodged as a bond with the Department - as his evidence was "well, nobody told me that the limit of how much would be asked back would be $5,000. That is something that I made my own assumptions on". Mr McQuinlan contended that Mr Soriano had "done very little on his own … to mend fences [solve family problems]" when this was something within his "ballpark".
Mr McQuinlan further contended that a further reason for not waiving the debt because of the "special circumstances" provision of the Act was that Mr Soriano had a capacity to repay the debt – albeit at a modest rate (see Exhibit 2). Accordingly, financial hardship alone did not make it desirable to waive the debt.
In response to a Tribunal question, Mr McQuinlan acknowledged that it was not in issue that Mr Soriano had "knowingly" made a false statement or representation or failed to comply with a provision of the Act.
Consideration of the IssuesThe objective of the Tribunal is to review administrative decisions not only on their merits, but in accordance with the law at all times.
The first issue for the Tribunal to decide is the credibility of Mr Soriano as a witness. The Tribunal finds Mr Soriano to be an honest, credible witness who had acted consistently, at all times, in his dealings with the Department.
The next question for the Tribunal to decide is whether special benefits were payable to Mr and Mrs Flores. On consideration of all of the evidence before the Tribunal and the Departmental Policy Guideline paragraph 15.2120 (Document T7 Folio 57) and paragraph 1.9500 (Document T7 Folio 55), the Tribunal concludes that on the balance of probabilities a significant change in circumstances warranted payment of special benefits to Mr and Mrs Flores. Accordingly, as special benefits were payable to the Flores within Regulation 2.38 of the Migration Regulations 1994, there is a debt payable within Section 1227 of the Social Security Act 1991.
The next issue for the Tribunal to consider is whether paragraph (b) of Section 1237AAD of the Act is satisfied – that is, whether there are "special circumstances (other than financial hardship alone) that makes it desirable to waive" the right to recover all or part of the debt. The Tribunal has had to consider the meaning and application of the expression "special circumstances" on many occasions. The decision of the Tribunal in Re Beadle and Director-General of Social Security (1984) 6 ALD 1 has become an oft-quoted benchmark as to the interpretation of "special circumstances". In that case 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."
The Tribunal concludes, in relation to the "Assurance of Support" debt accruing over the period 1 May 1998 to 30 May 1999, that for the following reasons there are "special circumstances" in Mr Soriano's situation consistent with the interpretation in Beadle's case:
A failure to adhere to Departmental Policy Guidelines. Specifically –
no interview at the new claim stage where Mr Soriano and the Flores all understood that any recoverable payment made to the Flores whilst the "Assurance of Support" was effective would become a debt that Mr Soriano must pay (paragraph 1.9300 - Document T7 Folio 54);
a failure to refer the Sorianos and the Flores to social work staff or a professional mediator with the object of resolving their family conflict (paragraph 1.9502 - Document T7 Folio 55); and
an omission to provide Assurance of Support reviews at three-monthly intervals to notify Mr Soriano of the amount of debt outstanding (paragraph 6.1.4 – Document T7 Folio 55).
Moreover, the Tribunal concludes that adherence to these Departmental Policy Guidelines would, at the very least, have provided Mr Soriano with an opportunity to resolve family conflicts through counselling or mediation. Accordingly, Mr Soriano could have considered strategies for avoiding or minimising the accruing debt (see paragraph 17); or addressing the issue and consequences of special benefit payments with his parents. Not only was this opportunity denied to Mr Soriano, but it was exacerbated by the Department's failure to inform him, immediately, of his parent's location. Accordingly, the possibility of facilitating some form of family conciliation together with avoidance or minimisation of the debt was lost.
Furthermore, the Department was aware that Mr Soriano may not have understood the implications of overpayments and special benefit payments generally (see paragraph 27), yet there was no evidence before the Tribunal that the Department took action to remedy the problem.
In Secretary, Department of Social Security and Bosworth (1989) 18 ALD 373 the Tribunal said:
"Subject to the distinction drawn between policies made or settled at a political level as against those made or settled at a Departmental level (Re Becker and Minister for Immigration and Ethnic Affairs (1977) 1 ALD 158) and the respective weight attributed to each of those differently generated policies (Re Aston and Secretary, Department of Primary Industries (1985) 8 ALD 366) the Tribunal standing as it does in the shoes of the decision-maker must try to act, subject to what is said below [Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634 (Drake's case)] in conformity with that policy."
The Tribunal concludes that, in the specific circumstances of Mr Soriano's fact situation, the Departmental Policy Guidelines were consistent with the Social Security Act when the "Drake test" was applied. The Guidelines were directed at promoting consistency in decision-making.
The Departmental Advocate acknowledged that the issue of Mr Soriano "knowingly" making a false statement or representation or failing to comply with a statutory provision was not in issue (see paragraph 36).
For all of these above reasons (paragraphs 41–44), the Tribunal concludes that there are "special circumstances" in Mr Soriano's situation because the circumstances justify the description of "uncommon" or "unusual". Accordingly, the Tribunal concludes that the whole of the debt should be waived under the "special circumstances" provisions of the Act.
The Tribunal sets aside the decision under review and in substitution therefor decides:
(a)to waive the whole of the debt accrued over the period 1 May 1998 to 30 May 1999 because of "special circumstances"; and
(b)in accordance with subsection 1237(2)(a) of the Social Security Act 1991, the waiver is to take effect on the balance of the debt as at 1 June 1999.
I certify that the 46 preceding paragraphs are a true copy of the reasons for the decision herein of Dr EK Christie, Member
Signed: Emma Oettinger
AssociateDate/s of Hearing 14.7.00
Date of Decision 20.9.00
Counsel for the Applicant Miss C Heyworth-Smith
Solicitor for the Applicant Welfare Rights Centre Inc
Counsel for the Respondent
Solicitor for the Respondent Mr R McQuinlan, Departmental Advocate
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