TERRI MILLER and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
[2013] AATA 366
•31 May 2013
[2013] AATA 366
Division GENERAL ADMINISTRATIVE DIVISION File Number
2012/2149
Re
TERRI MILLER
APPLICANT
And
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
RESPONDENT
DECISION
Tribunal Ms K Hogan, Member
Date 31 May 2013 Place Perth DECISION SUMMARY
The Tribunal varies the decision under review by declining to apply a 10% penalty to the debt.
………[sgd]………………………….
Ms K Hogan, MemberCATCHWORDS
SOCIAL SECURITY – Overpayment of Disability Support Pension – Applicant not Qualified for Disability Support Pension During Relevant Period - Obligation to Notify Centrelink of Change in Circumstances – Applicant Owes Debt to the Commonwealth – Inappropriate for the Debt to be Waived or Written Off – Debt not Solely Due to Administrative Error - 10% Penalty not imposed
LEGISLATION
SocialSecurity Act 1991
Social Security (Administration) Act 1999
CASES
Angelakos and Secretary, Department of Employment and Workplace Relations [2007] FCA 25
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Callaghan and Department of Social Security (1996) 45 ALD 435
Re Secretary, Department of Family and Community Services and Difford [2000] AATA 1089
Shelmerdine and Secretary, Department of Family and Community Services [2000] AATA 91
Walsh v Secretary, Department of Family and Community Services [2003] AATA 817REASONS FOR DECISION
Ms K Hogan, Member
31 May 2013
HISTORY
Ms Miller was granted disability support pension (DSP) from 1 February 2007.
On 2 November 2011, a Centrelink officer decided to raise and recover a debt of $15,579.31 inclusive of a 10% penalty in respect of overpaid DSP during the period 1 July 2010 to 7 September 2011 (the Relevant Period).
On 28 February 2012, a Centrelink Authorised Review Officer (ARO) decided to affirm the original decision.
Ms Miller appealed to the Social Security Appeals Tribunal (SSAT) who, on 21 May 2012 affirmed the decision of the ARO.
On 24 May 2012, Ms Miller appealed that decision to this Tribunal.
THE ISSUES
The issues to be considered by the Tribunal are:
(a)whether Ms Miller was overpaid DSP;
(b)if so, whether the overpayment was a debt owed to the Commonwealth;
(c)whether a 10% penalty should be applied; and
(d)whether all of part of the debt should be written off or waived.
EVIDENCE
The Tribunal was provided with a number of documents including:
(a) the section 37 documents;
(b) written submissions from Ms Miller and the respondent.
(c) the Tribunal heard oral submissions by and on behalf of the parties.
CONSIDERATION OF THE ISSUES/CONTENTIONS
Agreed Facts
Ms Miller did not dispute knowledge of her obligations to notify Centrelink when her circumstances changed such that her entitlement to benefits was affected.
Ms Miller was employed by the following companies in the period 1 July 2010 to 7 September 2011:
(a)Orange Recruitment Pty Ltd (Ausdrill): 28 June 2010 to 22 October 2010 (T5 p36).
(b)Orange Recruitment Pty Ltd (Marble Group) WA Pty Ltd: 28 October 2010 to 5 December 2010 (T9 p 47 and 50).
(c)Chandler McLeod Limited: 25 January 2011 to 9 May 2011 (T4 p31 to 33).
(d)BHP Billiton Limited: 13 April 2011 to 18 May 2011.(T1 p7;T13. p 130)
(e)VDM Construction Pty Ltd (formerly Wylie and Skene Pty Ltd): 27 June 2011 to 7 September 2011 (T3 p20).
LEGISLATION
The legislation relevant to this decision is contained in the Social Security Act 1991 (the Act) and the Social Security (Administration) Act 1999 (the Administration Act).
Section 94 of the Act sets out the qualification requirements to be eligible to receive DSP. Relevantly, one such requirement is a person has a continuing inability to work (section 94(1)(c)(i)).
Work is defined in section 94(5) to mean “work that is for at least 15 hours per week on wages that are at or above the relevant minimum wage”.
Section 68 of the Administration Act provides that the Secretary may give to a person who receives the Social Security benefit a notice that requires the person to inform Centrelink when a specified event or change of circumstances occurs.
Section 93 of the Administration Act provides for automatic cancellation of benefits where a person has received a section 68 notice, advises Centrelink of a change in circumstances and as a result in the change of circumstance the person no longer qualifies for the benefit.
Section 96 of the Administration Act provides that where a person has ceased to be qualified for DSP because they obtained work that is for at least 15 hours per week and the person who has informed Centrelink that they have obtained work within the period referred to in section 93, the Secretary may determine that the person’s DSP is suspended rather than cancelled.
Section 94 of the Administration Act provides for automatic cancellation of benefits where a person has received a section 68 notice which requires them to notify Centrelink of a change of circumstances within a specified period and the person fails to notify Centrelink of a change of circumstances and because of the change in circumstances the person is no longer qualified for the benefit or the benefit is no longer payable. The benefit is automatically cancelled from the day that the change of circumstances occurred.
Section 1223 of the Act provides that if a Social Security payment is made and the person who obtains the benefit of the payment was not entitled for any reason to obtain the benefit, the amount of the payment is a debt due to the Commonwealth.
Section 1228B of the Act provides that if a debt arises in relation to a DSP payment, that arose wholly or partly because the person who received the payment had refused or failed to provide information in relation to the person’s income or knowingly or recklessly provided false or misleading information in relation to the person’s income, a penalty of 10% is added to the debt.
Section 1228B(4) provides that the section does not apply if the Secretary is satisfied that the person had a reasonable excuse for refusing or failing to provide the information.
Section 1237A of the Act provides that 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 that gave rise to the proportion of the debt.
Section 1237AAD of the Act provides that the Secretary may waive the right to recover all or part of the debt is the Secretary is satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly making a false statement or representation or knowingly failing or omitting to comply with a provision of the Act or the Administration Act;
(b)there are special circumstances that make it desirable to waive the debt; and
(c)it is more appropriate to waive than to write off all or part of the debt.
Section 1236 of the Act provides that Secretary may on behalf of the Commonwealth decide to write off a debt if one or more of the following applies:
(a)the debt is irrecoverable at law;
(b)the debtor has no capacity to repay the debt;
(c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
(d)it is not cost effective for the Commonwealth to take action to recover the debt.
APPLICANT
Ms Miller contended that she had telephoned Centrelink on numerous occasions and provided updated employment and income details but that Centrelink did not always record the conversations and that the failure of Centrelink had lead to her being overpaid.
Ms Miller conceded that on some occasions in the past, and in the relevant period, she had been late to provide the employment and income information and accepted that when she was late, if she had been overpaid she would be required to repay the money.
In her letter to the Tribunal of 1 December 2012 Ms Miller explained that, when speaking to a representative of "S/S or an independent person"…" I told her what had been happening and said I still say the money was not mine and do not take things that do not belong to me and I was quite happy to pay it back "
In her evidence to this Tribunal Ms Miller stated:
"I have no qualm in paying a section of it because I know that times I ring up late and I ring up and I say, "So sorry," and she goes, "It's okay. You will just be back charged". You know? I ring up - even when I change jobs, even though I don't have to because I'm still with the same company, you know, just because I know Centrelink is Centrelink. I just don't know what else to do" [transcript pages 51-52.]
"I have said that from the beginning. I don't know what more to do to prove my innocence, you know? It's not my money and I agree. I'm not a bad person. But I didn't take it intentionally. I didn't know I was getting it. I just - you know. I have no - you know, even in the beginning I didn't have any problem paying it back because I'm not a thief. I don't take other people's money" [transcript page 54].
"I did ring, I did do it. I can't prove apart from walking into a time machine and taking you back to that day. I don't know what more I can prove except for my phone bills, you know" [transcript page 50].
Ms Miller struggled to present evidence, in support of her case, of telephone calls made by her to Centrelink and was unable to provide evidence of the claimed calls.
Ms Miller claimed that when she was away she sometimes she did not check her bank account for 6 months.(T1 page 9: Ms Miller's hand written comments on SSAT decision)
RESPONDENT
The respondent contended that:
(a)in the relevant period there was an overpayment to Ms Miller of $14,163.58;
(b)the overpayment is a debt due to the Commonwealth pursuant to Section 1223 of the Social Security Act; and
(c)a 10 per cent penalty is appropriate in this case, pursuant to section1228B because the debt arose wholly or partly because Ms Miller had failed to provide information in relation to her income from personal exertion.
In Shelmerdine v Secretary, Department of Family and Community Services [2000] AATA 91, the Tribunal held that failing to supply correct information or exercise due care is reckless behaviour. The respondent submitted that similar reasoning should apply in this case. Ms Miller did not supply correct information within the relevant time, and therefore behaved recklessly.
In Re Secretary, Department of Family and Community Services and Difford [2000] AATA 1089, the Tribunal found that delay in advising Centrelink of earnings received did not constitute a reasonable excuse.
The respondent contended that this was not a case where waiver or write-off is appropriate because the debt was not attributable solely to an administrative error made by the Commonwealth.
The respondent contended that all of the telephone calls within the relevant period that Ms Miller made to the DSP phone number, which is 132 717, are recorded in the electronic documents kept by Centrelink.
The respondent contended that there is no conclusive evidence that Ms Miller phoned Centrelink when she said she did.
The respondent contended that even if the Tribunal were to find that Ms Miller did phone Centrelink on some other occasions, there is no evidence of what was actually discussed.
The respondent contended that there were no special circumstances to invoke consideration of the writing-off of the debt.
CONSIDERATION OF ISSUES
The Tribunal finds that Ms Miller was not entitled to receive any DSP payments in the periods during which he was employed for more than 15 hours per week (see paragraph 9 above)
The Tribunal finds that Ms Miller was overpaid DSP in the relevant period and therefore the amount of the overpayment is a debt to the Commonwealth pursuant to section 1223 of the Act.
Ms Miller did not dispute, and the Tribunal finds, that she was aware of her obligation to report her income and change of employment circumstances to Centrelink within 14 days and that she had reported her income to Centrelink on other occasions.
The Tribunal finds that the debt arose because Ms Miller failed to provide information to Centrelink in relation to her income from personal exertion within the time specified in the correspondence sent to her on a number of occasions (T11).
In Walsh v Secretary, Department of Family and Community Services [2003] AATA 817 the Tribunal considered the meaning of reckless and noted:
In Shelmerdine and Secretary, Department of Family and Community Services (2000) AATA 91 the Tribunal held that failing to supply correct information or exercise due care equated with reckless behaviour and therefore was a breach of the law.
Ms Miller had advised that sometimes she was late in advising Centrelink that she had started work. In Re Secretary, Department of Family and Community Services and Difford [2000] AATA 1089, the Tribunal found that delaying in advising Centrelink of earnings received did not constitute a reasonable excuse.
The frustration of Ms Miller in dealing with Centrelink was palpable. She became distressed during the hearing when recounting some of her experiences with Centrelink. It was clear to the Tribunal that Ms Miller was troubled by allegations of dishonesty on her part.
Whilst the Tribunal considers it unusual that Ms Miller would not check her bank account whilst she was away, the Tribunal accepts Ms Miller's evidence that she did not check the account. The Tribunal finds that Ms Miller was not aware that she was being overpaid.
Ms Miller's evidence was that there were times in the past when she had not notified Centrelink in a timely manner and although she had to repay any overpayment there was no suggestion that this was inappropriate or deceitful. Her evidence was not contradicted and the Tribunal finds that in the circumstances of that evidence it would not be appropriate to regard her failure to advise as being reckless and therefore declines to apply a 10% penalty to the debt.
Whilst the Act provides that in limited circumstances, recovery of all or part of a debt from a person may be waived or written off, section 1237A of the Act provides that recovery of a debt must be waived where the debt was attributable solely to administrative error made by the Commonwealth and the payments that gave rise to the debt were received in good faith.
The AAT considered the meaning of the word 'solely' in Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126:
The ordinary or usual interpretation of the phrase 'attributable solely to' is that it refers to the single or sole cause of the relevant act or event. The word 'attributable' means 'capable of being attributed'. It involves an objective assessment of causation. The words 'a debt attributable solely to an administrative error' can be paraphrased as meaning that the only cause that objectively can be ascribed to the relevant debt is an administrative error…
Although Ms Miller maintained that Centrelink made the most significant mistake, she gave evidence that she considers that both she and Centrelink made the mistake. On the basis of Ms Miller’s evidence, the debt was not attributable solely to administrative error by Centrelink and waiver under section 1237A of the Act is inappropriate.
The Tribunal does not find that the debt was attributable solely to administrative error made by the Commonwealth.
In view of the finding in paragraph 49 above it was not necessary for the Tribunal to consider whether the payments that gave rise to the debt were received in good faith.
Section 1237AAD of the Act provides that the Secretary may waive the right to recover all or part of the debt. The Secretary must be satisfied that the debt did not result relevantly wholly or partly from the debtor knowingly failing or omitting to comply with a provision of the Act and there are special circumstances that it make it desirable to waive recovery of the debt. It must be more appropriate to waive than to write off the debt or part of the debt.
The Tribunal considered whether Ms Miller knowingly made a false statement or false representation or failed or omitted to comply with the requirements of the Act and the Administration Act. The meaning of the word 'knowingly' has been discussed in a number of decisions made by the Administrative Appeals Tribunal. In Re Callaghan and Department of Social Security (1996) 45 ALD 435 Deputy President Forgie commented that:
“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.”
The term “special circumstances” is not defined in the Act however, it has been extensively considered in case law:
In ReBeadle and Director-General of Social Security (1984) 6 ALD 1 (page 3) the Administrative Appeals Tribunal stated as follows:
“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.
...”
In Angelakos and Secretary, Department of Employment and Workplace Relations [2007] FCA 25 (at 33) the Federal Court stated as follows:
“There is less risk of overstatement if the words ‘unusual’ or ‘uncommon’ are emphasised. Those words indicate, correctly in my view, the fact that there must be something that distinguishes the case from the ordinary or usual case.”
The Tribunal finds that Ms Miller did not identify any circumstances that could be considered special and the Tribunal finds that a write off under section 1237AAD of the Act is inappropriate.
Section 1236 of the Act allows for recovery of debts to be written off for a period of time if the debt is irrecoverable at law or the debtor has no capacity to repay the debt or the debtors whereabouts are unknown.
At the time of the hearing Ms Miller was employed. The Tribunal finds that she has an ongoing capacity to repay the debt and write off under section 1236 of the Act is inappropriate.
DECISION
The Tribunal varies the decision under review by declining to apply a 10% penalty to the debt.
I certify that the preceding 57 (fifty-seven) paragraphs are a true copy of the reasons for the decision herein of Ms K Hogan, Member .
.........[sgd D Brodie]...............................................................
Administrative Assistant
Dated: 31 May 2013
Dates of hearing 12 November 2012
18 March 2013Applicant
Self by Phone
Advocate for the respondent
Ms Ladhams
Australian Government Solicitor.
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