Tesoriero and Secretary, Department of Family and Community Services
[2004] AATA 673
•29 June 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 673
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2003/336
GENERAL ADMINISTRATIVE DIVISION ) Re NICOLE-JAY TESORIERO Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Rear Admiral A R Horton, Member Date 29 June 2004
Place Sydney
Decision The decision under review is affirmed.
[Sgd] Rear Admiral A R Horton, Member
CATCHWORDS
SOCIAL SECURITY – raising and recovery of debt – applicant enrolled in Certificate in Matriculation full-time studies at TAFE in June 1999 – applicant granted “unable to live at home” rate of youth allowance – youth allowance cancelled in June 1999 at request of applicant on basis of cessation of studies – respondent advised by ‘tip-off’ that applicant had not attended studies in relevant period – TAFE confirmed no record of full- time attendance – applicant concedes attendance was insufficient to meet full-time criteria - effect of medical and family circumstances on ability to meet full-time study load – whether debt can be written off in accordance with legislative provisions – consideration as to special circumstances – criteria not met – decision affirmed
Social Security Act 1991 – sections 540, 541(1), 541B(1), 542A(1), 1223(1), 1236(1), 1237A(1), 1237AAD
Youth Allowance (Activity Test Exemption Guidelines) Determination 1998
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Tesoriero and Secretary, Department of Family and Community Services [2004] AATA 665
REASONS FOR DECISION
29 June 2004 Rear Admiral A R Horton, Member
1. This is an application to review a decision of the Social Security Appeals Tribunal (“SSAT”) on 5 February 2003 that affirmed a decision of an Authorised Review Officer (“ARO”) on 17 October 2000, that in turn had affirmed a decision of a delegate of Centrelink dated 27 June 2000, to raise and recover a debt in respect of youth allowance that had been paid to Ms Nicole-Jay Tesoriero (formerly Wilcockson).
2. At a hearing on 31 May 2004, Ms Tesoriero was self represented. Ms J Green, an advocate from the Centrelink Services Recovery Team, appeared for the Secretary, Department of Family and Community Services (“the Respondent”). The Tribunal took into evidence the documents provided by the Respondent pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, additional T documents (T1), the AAT decision in Re Tesoriero and Secretary, Department of Family and Community Services [2004] AATA 665 (Exhibit T2), Financial Information and documents in respect of the relationship between Ms Tesoriero and her mother, Mrs Rosalie Stavala (Exhibit A1), the Respondent’s Statement of Facts and Contentions (Exhibit R1) and further documents in respect of the approval by the Respondent of Youth Allowance (Exhibit R2).
3. In the absence of Ms Tesoriero from a hearing scheduled for 23 January 2004, the Tribunal dismissed the application for review. At a hearing on 9 March 2004, the Tribunal considered applications from Ms Tesoriero for reinstatement, and a stay of a decision by the SSAT in respect of the recovery of the overpayment debt. On 19 March 2004, the Tribunal reinstated the application, but refused to stay the decision to raise and recover the debt., a garnishee to remain in force until, and subject to the satisfaction of the Respondent, an arrangement for repayment of the debt was formalised. (Exhibit T2 refers).
BACKGROUND AND EVIDENCE
4. The paperwork before the Tribunal in respect of claims for Youth Allowance under section 540 of the Social Security Act 1991 (“the Act”) is somewhat confusing in respect of completion dates and lodgement with Centrelink. From oral evidence, it seems that Ms Tesoriero, born on 8 April 1981, applied for financial assistance in respect of an intention to undertake studies at Ultimo/Enmore College of Technical and Further Education (“TAFE”) in 1998, she having left school on completion of year 10 the previous year. Her evidence was that she could not continue with those studies because of problems between she and her mother. The Tribunal assumes that at that time she became aware to some extent of the general procedures involved in obtaining financial assistance for study.
5. In January 1999, she lodged a claim for Youth Allowance, indicating her intention to undertake the Matriculation year 11 course at Randwick TAFE of 12 hours per week study, commencing on 2 February 1999 and completing in December that year. That claim form indicated she lived with her mother at Pagewood (T3 p19), but some few days later she completed an “Unreasonable to Live at Home” (UTLAH) Form (there being 2 forms in the T documents, dated respectively 5 January 1999 and 22 January 1999, the writing being different in each case), indicating she was living at Marrickville with her boyfriend’s parents, as she could not get along with her mother.
6. An undated comprehensive Social Worker assessment by Chris Zisopoulos in respect of the claim for UTLAH is before the Tribunal at T9, p91 – 93. It throws light on the situation at the time, notes that Ms Teserioro was still living with her mother in mid January, and that in the circumstances, and notwithstanding the difficulties between she and her mother, she was informed at that time that she was accordingly not eligible for the claimed UTLAH allowance.
7. The later UTLAH Form of 22 January, reflected the extent of the situation at that time. Ms Tesoriero informed the Social Worker that she “had been kicked out”, although Mrs Stavala claimed that she had left of her own will, but in any event refused to conform to house rules. Ms Tesoriero was also subject to an Apprehended Domestic Violence Order (Exhibit A1). In the light of the unlikely reconciliation between Ms Teserioro and her mother, the accusations between them, the reported suicide attempts of the latter, and that Ms Tesoriero was living elsewhere (in Marrickville with her boyfriend’s parents), the Social Worker recommended payment of the UTLAH allowance, which was granted on 16 February 1999, backdated to 14 January 1999 (Exhibit R2 Attachment A). Documentary evidence before the Tribunal indicates she was in extreme financial difficulty at that time, particularly in regard to paying TAFE fees.
8. In oral evidence, Ms Tesoriero spoke emotionally of the then, and indeed ongoing to the present, conflict with her mother, who claimed to the Social Worker that her later marriage had failed because of the attitude of Ms Tesoriero. She indicated that whilst she is now living with her father, she had seen little of him since her parents divorced when she was about 10 years of age.
9. When advising Ms Tesoriero of the payment of Youth Allowance on 16 February 1999, Centrelink confirmed that Ms Tesoriero was studying full-time and that changes to the study load or cessation of study must be advised within 14 days. This advice was repeated in periodic Recipient Notification Notices under section 561B of the Act, Exhibit R2 Attachment C refers). Ms Tesoriero does not recall receiving these letters. The Respondent also advised Ms Tesoriero at the outset of the general conditions under which she could take employment whilst undertaking full-time study.
10. On 2 June 1999, Ms Tesoriero informed Centrelink that she intended to cease full-time study, and accordingly payment ceased. Ms Tesoriero stated to the Tribunal that she did not recall receiving advice that payment had ceased. On 14 October that year, Centrelink received a “Tip-off” that Ms Tesoriero had, among other accusations, not attended classes at TAFE, had sat no exams, was living with her father and his de-facto wife, and was earning $500 per week (T18A p116A). The documentary evidence before the Tribunal is that Centrelink did not pursue this matter until mid 2000, some 8 months later and there is no explanation for this delay. Referral to Randwick TAFE resulted in a response dated 7 June 2000 (T19A p117A) that Ms Tesoriero “(was) enrolled in course No 8967 but did not attend any classes”. Internal Centrelink memoranda states that Ms Tesoriero disputed this response, claiming that she was attending TAFE during the period, but did miss some days due to illness for which she provided medical certificates.
11. In oral evidence, Ms Tesoriero stated that she had periodically been obliged to miss classes due to illness, but she believed she had attended about 40% of the scheduled classes, generally reporting her attendance on arrival to the supervisor, except for occasions when she was late. She had not sat exams. In respect of medical certificates, the only evidence before the Tribunal is a letter from her treating doctor, Dr T Verghis of Eastgardens Medical Centre in 2002, in which he notes she has been attending that practice for ten years, had a “traumatic childhood and problems since” and undergone counselling, and was currently on medication for depression.
12. On 22 June 2000, Centrelink raised a debt for recovery of $2647.26, this decision being affirmed by an ARO on 17 October 2000. In response to a further request for information by Centrelink, Randwick TAFE re-affirmed in a faxed response of 6 December 2000 that Ms Tesoriero was “not a full-time student in semesters 1 and 2 of 1999, as she did not attend classes nor sit exams”. The response concludes that Ms Tesoriero “did not start, apparently”.
13. Ms Tesoriero lodged an appeal with the SSAT against the decision to recover the debt on 15 October 2002 this resulting from advice being received from a debt collection agency, Dunn and Bradstreet, that recovery proceedings were to commence. In evidence, Ms Tesoriero stated that this was the first she new of the debt. In the event, whilst the SSAT affirmed the decision to recover the debt, no acceptable arrangement with the Respondent was forthcoming, and garnishee action was eventually implemented. The subsequent request to the Tribunal for a stay was refused (AAT decision of 19 March 2004).
14. Attachment E to Exhibit R2 is a Centrelink record of the addresses of Ms Tesoriero. It states she moved from her mother’s residence at Pagewood to Marrickville in January 1999, before returning to live with her father at Botany (her present address) in late August 1999. Correspondence earlier referred to in respect of UTLAH and the conditions relevant to that allowance were addressed during the period under review to the correct address at Marrickville.
15. Ms Tesoriero has been “paying off” a loan on a motor vehicle since 1997. In September 2003, she traded in this vehicle on a new model, her loan commitment being $16,000. She has been employed on a full-time basis for a number of years, presently being with P and O Pty Ltd, where her annual salary is in the order of $28,000, and her take home pay per month about $1800. She is entitled to 5 days sick leave per year at full pay, but gave evidence that her health is such that she is absent much more frequently, and is not paid for these additional days. Ms Tesoriero also owes money to her father, and is called upon to pay $100 per week board. Her evidence is that she is often in financial difficulty, and indeed cannot afford to make payments in respect of the Youth Allowance debt, which she disputes. At the time of the hearing, she had reluctantly reached an agreement with Centrelink that her wages be garnisheed at $100 per fortnight.
SUBMISSIONS
16. Ms Tesoriero submitted that whilst she had not attended all classes at Randwick TAFE, her attendance being about 40 per cent in her view, nor sat any exams, that was a reflection of her medical problems and the disruption to her daily life because of the circumstances of the relationship with her mother. She believes the raising and recovery of the debt fails to take into account her personal circumstances. Further, and notwithstanding that she has been fully employed for some years, her financial circumstances are such that she has little flexibility in her private life, and cannot afford to make the necessary debt payments. She is critical of the advice she has received from time to time from Centrelink.
17. The Respondent contended that Ms Tesoriero did not meet the requirements of the applicable activity test under section 540 of the Act, nor did she have exemption from that test via section 542. Nor did she have a temporary exemption at any time as provided in section 542A, and there is insufficient evidence to support her contention that she was unable to attend studies due to medical conditions. The Respondent further contended that Ms Tesoriero did not satisfy section 541B of the Act which requires that a person be undertaking at least three-quarters of the normal amount of full-time study, 12 hours per week in this case.
18. As to section 542H of the Act, which provides for exemption from the activity test in special circumstances, the Respondent submitted that special circumstances could only apply if the difficulties were outside the person’s control, a situation not evident in the case of Ms Tesoriero, notwithstanding her family difficulties. As to other relevant legislation, the Respondent contended that the criteria to write off a debt pursuant to section 1236(1A) is not met, noting that Ms Tesoriero is employed full-time and has the capacity to repay, and that as there is no evidence to suggest that the Commonwealth was attributable solely to any proportion of the debt, the option of waiver under section 1237A(1) does not apply. Finally, the Respondent contended that application of the discretion to waive the debt in special circumstances as prescribed in section 1237AAD(b) could not be supported on the evidence, the circumstances in Ms Tesoriero’s case in respect of ability to meet the requirements of full-time study in the relevant period being neither beyond her control nor sufficiently unusual or different from those of many other social security recipients.
LEGISLATION AND DECISION
19. Section 540 of the Act states relevantly:
“Subject to this Subdivision, a person is qualified for a youth allowance in respect of a period if:
either of the following applies:
(i) throughout the period the person satisfies the activity test or is not required to satisfy the activity test;
(ii) … “
Section 541 sets out the criteria for satisfying the activity test, and relevantly states that may be through the undertaking of full-time study.
20. Section 541B(1) defines the criteria for full-time study, and section 541B(2) addresses the normal amount of full-time study in different circumstances, the relevant paragraphs of these two subsections being:
“541B(1). For the purposes of this Act, a person is undertaking full-time study if:
(a) the person:
(i) is enrolled in a course of education at an educational institution; or
…
(b) the person:
(i)is undertaking in the particular study period (such as, for example, a semester) for which he or she is enrolled for the course; or
(ii) …
either:
(iii)…at least three- quarters of the normal amount of full-time study in respect of the course for that period; or
(iv) …; and
(c)the course in question is an approved course of education or study (see subsection (5)); and
d)in the Secretary’s opinion, the person is making satisfactory progress towards completing the course”
21. Section 542 refers to the circumstances in which an exemption from the activity test may be granted. A temporary incapacity may be granted as further defined in section 542A(1), to the limit in section 542C(2) in respect of medical conditions arising from sickness or accident, and subject to the appropriate medical certification being made available. In this matter, there is insufficient evidence before the Tribunal to support the argument by Ms Tesoriero that medical conditions prevented her from meeting her study requirements. Only one medical report is before the Tribunal, that being from Dr Verghis in 2002, and there is no evidence to support the contention by Ms Tesoriero that she provided such certificates to Randwick TAFE.
22. Section 542H(1) provides for exemption where it is considered that special circumstances, beyond the person’s control, exist. This legislation is further subject to Ministerial guidelines in respect of the exercise of discretion, namely Youth Allowance (Activity Test Exemption Guidelines) Determination 1998. The Respondent submitted that the circumstances in this matter do not meet those criteria, and the Tribunal is in accord. Certainly, immediately prior to the commencement of her period of study, Ms Tesoriero was in a domestically disruptive situation, the AVO of 27 January 1999 being clear evidence to that effect. But shortly thereafter, she lived away from her mother, and remained in that domestic situation throughout the period of the semester, albeit that she gave evidence that at one point she moved to alternate accommodation. The Tribunal finds that her ability to attend at Randwick TAFE was matter of her own will and interest, noting also that medical evidence as to problems, which would preclude attendance, is sparse. Accordingly, the Tribunal is satisfied that Ms Tesoriero does not meet the criteria for exemption from the activity test.
23. In her original claim for youth allowance, Ms Tesoriero referred to formal course work of 12 hours per week. An Enrolment Form completed by Randwick TAFE and dated 8 February 1999 (T12 p97) lists module details and records a study load of 10. 30 hours per week. Taking account of Ms Tesoriero’s evidence that she believed she attended some 40 per cent of formal study periods, and the evidence from Randwick TAFE that they did not consider her a full-time student and that she did not attend classes nor sit examinations, the Tribunal finds that she did not meet the activity test requirement of three-quarters of the normal amount of full-time study pursuant to section 541B(1) of the Act and hence was ineligible for the Youth Allowance for the period 14 January 1999 to 1 June 1999 pursuant to section 540.
24. Chapter 5 of the Act provides further direction in respect of the recovery of debt owing to the Commonwealth. Section 1223(1) directs, subject to certain conditions, that if a social security payment is made to a person not entitled to receive that payment, the payment is a debt to the Commonwealth. Section 1236 then provides direction on the authority of the Secretary, or in this case the Tribunal, to write off a debt. The SSAT found that Ms Tesoriero’s circumstances did not match any of the criteria as set out in section 1236(1) and the Tribunal is in agreement. Whilst Ms Tesoriero emphasised in her evidence that she could not meet repayments, she is in full-time employment , and has been for some years, and she is paying the debt off in instalments, albeit by garnishee action.
25. In this matter, two subsections of the legislation remain to be considered. Firstly, section 1237A whereby the debt, or the relevant proportion thereof, must be written off if it was attributable solely to an administrative error of the Commonwealth, and had been received in good faith by the debtor. There can be no error on the part of Centrelink in this matter, as Ms Tesoriero was obligated, and periodically advised by Recipient Notification Notices, that she must inform Centrelink should her circumstances change, that including study commitments, and should she cease being a full-time student. This she did not do until 2 June 1999. Hence the debt cannot be waived under this provision.
26. Secondly, section 1237AAD of the Act provides an authority wherein a waiver may be further considered. It states relevantly:
“1237AAD The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
the debt did not result wholly or partly from the debtor or another person knowingly:
making a false statement or representation; or
failing or omitting to comply with a provision of this Act or the 1947 Act; and
there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
…”
27. The debt did not arise as a result of Ms Tesoriero knowingly making a false statement or representation. Whether Ms Tesoriero knowingly failed or omitted to comply with a provision of the Act, namely the requirement to meet the activity test requirement in order to remain eligible for the Youth Allowance, is a moot point. The Respondent did not pursue this issue, yet the requirements of Ms Tesoriero had been formally and adequately conveyed to her. There is no suggestion before the Tribunal that she did not receive period notification of he payments, her address at the time seemingly not being in question. On balance, and observing the position taken in other matters of this nature, the Tribunal considers it appropriate to consider whether special circumstances exist that might justify a waiver of the debt.
28. The term “special circumstances” in this context is not defined in the Act, but the view of Toohey J in the Federal Court decision in Re Beadle and Director General of Social Security (1984) 6 ALD 1, subsequently acknowledged by the Full Court, has been widely followed. His Honour stated:
“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. That is not to say that the circumstances must be unique but they must have a special quality of unusualness that permits them to be described as special”
29. The difficult circumstances in the early life of Ms Tesoriero, as described by the Social Worker are acknowledged, as is her relationship with her mother, which again is evidenced in papers before the Tribunal and in documentary and oral evidence given by Ms Tesoriero. But in respect of the period in which she sought to undertake full-time study, there is much of Ms Tesoriero’s making. She enrolled at Randwick TAFE and prior to commencing the semester had made arrangements for accommodation with her boyfriend’s parents which she described as good. She received Youth Allowance at a higher rate to take account of her living away from home. Whatever her periodic skirmishes with her mother in the next six months, she should have been able to control her day to day activities.
30. Minimal evidence is before the Tribunal to support her conjecture that medical problems significantly interfered with her ability to attend TAFE. Further, her evidence that she attended to a reasonable extent is not supported by the TAFE. The Tribunal can only assume that her enthusiasm for further education waned. As earlier stated, Ms Tesoriero emphasised in her evidence that she was continually in financial difficulties, yet she has owned a motor vehicle for a number of years and traded up as recently as late 2003. She has been employed full-time for a number of years. She is young, but seemingly needs to rationalise her outgoings. On all the evidence, the Tribunal cannot accept that the circumstances leading to Ms Tesoriero failing to complete full-time study in first semester 1999 are special; they cannot be considered uncommon or exceptional.
31. Whether the details of Ms Tesoriero’s activities as described in the “Tip- off” are reflective of what was actually happening in early 1999 is a matter of conjecture. There is no evidence in regard to most of the claims, and the Tribunal give little credence to the report other than to note that it apparently alerted the Respondent to investigate whether Ms Tesoriero was undertaking full-time study.
DECISION
32. The decision of the SSAT to affirm the decision by Centrelink to raise and recover a debt of $2,647.26 from Ms Nicole-Jay Tesoriero in respect of an overpayment of Youth Allowance is affirmed.
I certify that the 32 preceding paragraphs are a true copy of the reasons for the decision herein of
Signed: Neil Glaser
AssociateDate of Hearing 31 May 2004
Date of Decision 29 June 2004
Representative for Applicant Self Represented
Advocate for the Respondent Ms Jane Green
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