Stergiou and Secretary, Department of Family and Community Services

[2002] AATA 731

DECISION AND REASONS FOR DECISION [2002] AATA 731

ADMINISTRATIVE APPEALS TRIBUNAL      )

)No A2002/87

)No A2002/88

GENERAL ADMINISTRATIVE  DIVISION       )          
           Re      STANLEY STERGIOU and  EKATERINA STERGIOU        
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES        
  Respondent

DECISION

Tribunal       Mr M J Sassella, Senior Member

Date27 August 2002

PlaceCanberra

Decision      The tribunal affirms the decisions under review.          
  ..............................................
  Senior Member
CATCHWORDS
SOCIAL SECURITY – Age Pension – Wife Pension – overpayments of pension – debts due to the Commonwealth – failure to correct wrong rate of combined annual income – failure to notify of increased combined annual income – write off considered but not applied – waiver considered but not applied – no special circumstances justifying waiver

Social Security Act 1991 ss 23(5A), 43(1), 68, 172, 1224, 1236, 1237, 1237A, 1237AA, 1237AAB, 1237AAC, 1237AAD, 1237AB

Beadle and Director-General of Social Security, Re (1984) 6 ALD 1
Beadle v Director-General of Social Security (1985) 7 ALD 670

REASONS FOR DECISION

27 August 2002      Mr M J Sassella, Senior Member            

APPLICATIONS BEFORE THE TRIBUNAL

1. Application A2002/87 is an application to the Administrative Appeals Tribunal ("the tribunal") by Mr Stanley Stergiou ("the first applicant") for review of a decision dated 29 January 2002 and made by the Social Security Appeals Tribunal ("the SSAT") (T2).  The SSAT had affirmed a decision by a Centrelink authorised review officer ("ARO") who on 17 October 2001 (T29) had affirmed a primary decision made by a delegate within Centrelink (T21).  The decision before the tribunal was that there was a debt due to the Commonwealth in an amount of $3,001.89 owed by Mr Stergiou in respect of an overpayment of Age Pension.

2. Application A2002/88 is an application to the tribunal by Mrs Ekaterina Stergiou ("the second applicant") for review of a decision dated 29 January 2002 and made by the SSAT (T2).  The SSAT had affirmed a decision by a Centrelink ARO who on 17 October 2001 (T30) had varied a primary decision made by a delegate within Centrelink (T23).  The decision before the tribunal was that there was a debt due to the Commonwealth in an amount of $3,001.89 owed by Mrs Stergiou in respect of an overpayment of Wife Pension.
   HEARING

3. The tribunal convened a hearing in this matter in Canberra on 26 August 2002.  Mr Stergiou represented himself and Mrs Stergiou.  Mr D Perdon of the Centrelink Advocacy and Administrative Law Team represented the respondent.  The tribunal had Mr Stergiou sworn and he presented mixed evidence and submissions.  The tribunal admitted into evidence the following documentary material:

• Exhibit TD1 – Section 37 Statement and associated documents (T1 – T44) provided by the respondent.

• Exhibit A1 – Affidavit of Stanley Stergiou, 30 June 1999.

• Exhibit A2 - Affidavit of Stanley Stergiou, 27 May 2002.

• Exhibit A3 – Affidavit of Stanley Stergiou, 26 August 2002.

FINDINGS ON MATERIAL QUESTIONS OF FACT WITH REFERENCE TO THE EVIDENCE AND OTHER MATERIAL IN SUPPORT OF THOSE FINDINGS

1. The tribunal finds that Mr Stergiou has been in receipt of a pension since 3 June 1993, initially Disability Support Pension and later an Age Pension (T2/6). 

2. The tribunal finds that Mrs Stergiou has been in receipt of a Wife Pension since 3 June 1993 (T2/6). 

3. The tribunal finds that Mrs Stergiou has been employed since 13 December 1990 (T2/6). 

4. The tribunal finds that Mr Stergiou's date of birth was 18 August 1934 (T1/1).  He was to qualify for Age Pension as of 18 August 1999 at age 65 (Social Security Act 1991 s 23(5A), 43(1) ("the Act"). The tribunal finds that on 16 July 1999, preparatory to Mr Stergiou's transfer to Age Pension, Centrelink received from him a pension entitlement review form (T5). The tribunal finds that on 23 July 1999 Centrelink wrote to Mr Stergiou seeking proof of Mrs Stergiou's earnings in the previous 13 weeks (T5).

5. The tribunal finds that on 2 August 1999 Mr and Mrs Stergiou provided payslips (T6), the most recent of which (for the pay period ending on 14 July 1999) indicated an annual gross income of $12,456.93.  This amount, along with minimal bank interest, was used in calculation of the applicants' rates of pension (T7).

6. The tribunal finds that in notices sent to the applicants on 12 August 1999 (T7), 25 August 1999 (T10), 27 August 1999 (T11) and 31 August 1999 (T11) their combined total income was quoted as $12,457.35. The tribunal finds that these notices required the recipients to notify Centrelink if the combined income as shown was incorrect or of it increased. The tribunal finds that the applicants received some or all of these letters as is indicated in Mr Stergiou's letter to Centrelink dated 28 August 2001 (T37). The tribunal finds that these were valid recipient notification notices under ss 68 and 172 of the Act.

7. The tribunal finds that on 21 June 2001 Centrelink commenced a review of the second applicant's pension entitlements and wrote to her seeking verification of her earnings over the previous 12 weeks (T14).  The tribunal finds that Mrs Stergiou provided information on 4 July 2001 (T15).  This showed a gross income for the year to 13 June 2001 of $18,675.67.  The tribunal finds that further information from Mrs Stergiou's employer (T16) indicated that her earings had exceeded the prescribed rate of pay from July 1999 for the next two years in all fortnights except for five.  As ex R1 says, it appeared that Mrs Stergiou almost always received more than her base salary because she received weekend, public holiday and other allowances not included in her base annual salary figure. 

8. The tribunal finds that a delegate in Centrelink raised overpayments affecting both applicants on 20 July 2001 (T22, T24).  For the first applicant the debt was $3,001.89 (T21/86).  For the second applicant the debt was $3,001.56 (T23/94). 

9. The tribunal finds that Mr Stergiou contacted Centrelink on 10 October 2001 (T25) seeking to have the rate of repayments deducted by Centrelink fortnightly from the applicants' pension payments reduced to $50 each a fortnight.  Mr Stergiou told the tribunal that Centrelink is still withholding $50 from each of them each fortnight. 

10. The tribunal finds that on or about 2 October 2001 the first applicant sought to have the decisions to recover the debts reviewed (T26).  He said that neither he nor the second applicant were told that they needed to update their income details with Centrelink.  They assumed that Centrelink contacted the second applicant's employer directly and obtained updates. 

11. The tribunal finds that when the applicants had the matter referred on to the ARO (T26) the decisions were unaffected except that the second applicant's debt was adjusted to $3,001.89, the same quantum as the first applicant's debt.  This was only a few cents higher than had been demanded earlier.

12. The tribunal finds, on the basis of information from Mr Perdon at the hearing, that as at 26 August 2002, each of the applicants owed $1,171.  Each had repaid $1,830.

13. The tribunal finds that each of the applicants incurred a debt due to the Commonwealth in accordance with s 1224 of the Act.

    1224.(1)  If:
     (a)     an amount has been paid to a recipient by way of social security payment …; and
    (b)       the amount was paid because the recipient or another person:

    …

    (ii)       failed or omitted to comply with a provision of the social security law or this Act as in force immediately before 20 March 2000, …;
    the amount so paid is a debt due by the recipient to the Commonwealth.

14. Section 1224(1) is satisfied in the case of each applicant because:

• An amount in the form of a social security payment was paid to each of the applicants; and

• That amount was paid because each applicant failed to comply with the recipient notification notice provisions advised to them in the letters described above in paragraph 9.  That is to say that each applicant failed to advise Centrelink, as required, of successive rises in Mrs Stergiou's salary income. 

1. The tribunal notes that the scheme in chapter 5 of the Act is such that a debt due to the Commonwealth must be recovered by the respondent unless the provisions for non-recovery of debts apply. In short, a debt may be written off under s 1236 of the Act or it may be waived under s 1237 of the Act if certain conditions are met.

2. The tribunal finds that the applicants' debts cannot be written off. Section 1236(1A)(d) provides in effect that write off is not available where a debtor is in receipt of an ongoing social security payment. Both Mr and Mrs Stergiou in the present cases are still in receipt of pensions.

3. In order to waive a debt a Centrelink delegate has to be satisfied that at least one of ss 1237A, 1237AA, 1237AAB, 1237AAC, 1237AAD or 1237AB apply in a debtor's case. The tribunal finds in the present cases that the only one of these provisions that could possibly apply is s 1237AAD of the Act.

   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 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.

4. There are several barriers to be surmounted if this provision is to assist the applicants. It is simple enough to accept that they probably did not "knowingly" fail to comply with the recipient notification notice provisions of the Act. However, it is not possible to find in their circumstances "special circumstances" as required by the Act. The tribunal and the Federal Court have said the following about the requirement for special circumstances. In Re Beadle and Director-General of Social Security (1984) 6 ALD 1 Toohey J said at page 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 on 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."

This passage was largely endorsed by the full Federal Court in Beadle v Director-General of Social Security (1985) 7 ALD 670, 675.

1. The applicant presented several matters that might be regarded as special circumstances.  First, he told the tribunal about his diabetes which is severe.  It is adversely affecting his blood circulation and his eyesight.  He has hearing difficulties also.  Second, he and Mrs Stergiou are finding it difficult to manage their affairs while withholdings of $50 each are made by Centrelink each fortnight.  Third, Mr Stergiou presented material in the form of affidavits and sworn evidence suggesting that he and the second applicant have been the victims of harassment by two major banks.  It seems that Mr Stergiou ran a successful business which engaged in travel agency, cleaning contracts and other activities.  Mr Stergiou believes that the banks wanted his business closed down because he was too strong a competitor in the travel agency business.  He believes that they succeeded in this, that he lost the family home as one consequence, and that the banks have pressured Centrelink to threat him and Mrs Stergiou harshly.

2. Unfortunately none of these factors, in the tribunal's view, constitute circumstances sufficiently special for waiver under s 1237AAD. First, it is not uncommon for age or disability support pensioners to have serious health problems. This factor does not have the necessary quality of extraordinariness that is required from the Beadle (above) decisions.  Second, the same applies in relation to the applicants' financial circumstances.  It is not uncommon for persons in receipt of social security payments to find that they have little (if any) money remaining each fortnight after accounting for the necessities of life. 

3. Third, the only evidence before the tribunal in relation to Mr Stergiou's problems with the banks consisted of his own, admittedly sworn, statements. He may possibly be correct in his characterisation of the banks' actions and intentions, but the tribunal finds that the evidence before it is insufficient to sustain any suggestion of a link between the banks and Centrelink such that Centrelink has been pressured to act unconscionably toward Mr Stergiou. The Section 37 Statement and associated documents show that Centrelink has done no more in the applicants' cases than apply the provisions of the Act in a professional and appropriate way. The tribunal finds no special circumstance in this context.

4. The tribunal therefore finds that the applicants cannot succeed in their applications.  It was unclear what remedy Mr Stergiou was seeking in his presentation at the hearing.  He said at different times that he wanted no more than to place on record his disgruntlement with Centrelink's treatment of him and Mrs Stergiou.  I will say more on this below.  Elsewhere he said that he wanted the rate of withholdings reduced.  Mr Perdon undertook to have an officer in the Braddon, ACT office of Centrelink contact Mr Stergiou to look into a possible reduction in the rate of withholdings.  This officer is also to confirm that Centrelink is correctly assessing Mrs Stergiou's salary income.  Mr Stergiou believes that his wife's income is overassessed.
   OTHER MATTERS RAISED BY MR STERGIOU

5. Mr Stergiou did not believe that the applicants had to notify Centrelink of constant changes in Mrs Stergiou's income. The applicants thought that Centrelink could and would obtain such information from Mrs Stergiou's employer directly. The tribunal's comment on this proposition is that the Act contemplates that a social security recipient must personally notify Centrelink of matters including increases in income, assuming a proper notice to do this has been provided, as was done here. While Centrelink has a power to obtain information from employers, if it uses the correct forms requiring such information, that does not relieve recipients from their obligation to notify.

6. Mr Stergiou produced several statement-style letters he had received from Centrelink.  He was critical of the fact that these were unsigned.  It appeared that he would prefer to see a signature because that would indicate whom he should contact if he had queries about a letter.  The tribunal agrees that it might be preferable to see such letters signed, however there is no legal requirement that they must be signed.

7. Mr Stergiou complained that Centrelink treats him "like a migrant" although he has been 50 years in Australia and has paid all his taxes.  This appeared to refer to his treatment when in Centrelink offices.  The tribunal can do more than ask that Centrelink consider this and perhaps discuss the matter with the applicants.

8. Mr Stergiou asserted that he has written letters to Centrelink that have remained unanswered.  This is not a matter for the tribunal.

9. Mr Stergiou insisted that he had and Mrs Stergiou had notified Centrelink twice of Mrs Stergiou's income but that Centrelink did nothing about it for two years.  The tribunal would note in response that the problem was that the applicants' notifications were of amounts lower than Mrs Stergiou's actual earnings.  There was no evidence of any tardiness on Centrelink's part in acting on notifications in this matter. 
   DECISIONS

10. The tribunal affirms the decisions under review.

    I certify that the 31 preceding paragraphs are a true copy of the reasons for the decision herein of Mr M J Sassella, Senior Member

    Signed:         .....................................................................................
      Associate

    Date of Hearing  26 August 2002
    Date of Decision  27 August 2002
    Advocate for the Applicants     Applicant Mr S Stergiou

    Advocate for the Respondent  Mr D Perdon, Centrelink Advocacy and Administrative Law Team