Theo v Secretary, Department of Family and Community Services

[2004] AATA 1273

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 1273

ADMINISTRATIVE APPEALS TRIBUNAL      )

)No Q2004/259, 507

GENERAL ADMINISTRATIVE  DIVISION		)
Re		SOLON THEO

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Senior Member McCabe

Date1 December 2004

PlaceBrisbane

Decision The Tribunal affirms the decisions under review.

....................[Sgd]..........................

Senior Member McCabe

CATCHWORDS

SOCIAL SECURITY LAW – pensions and entitlements – age pension – calculation of arrears – decision affirmed

SOCIAL SECURITY LAW – pensions and entitlements – age pension – cancellation of pension – whether applicant given valid notice of request for information – whether applicant complied with notice – decision affirmed

SOCIAL SECURITY LAW – pensions and entitlements – age pension – decision to reject application for pension – whether applicant given valid notice of request for information – whether applicant complied with notice – decision affirmed

Administrative Appeals Tribunal Act 1975

Social Security (Administration) Act 1999

Income Tax Assessment Act 1936

Mabo v Queensland (No 2) (1992) 175 CLR 1

Re Adams and the Tax Agents’ Board (1976) 12 ALR 239

Butler v Attorney General (Vic) (1961) 109 CLR 268

REASONS FOR DECISION

1 December 2004 Senior Member McCabe    

1.      Mr Solon Theo is the applicant in these proceedings. The application arises out of a dispute over his entitlement to an Age Pension. Mr Theo’s pension was cancelled on 12 June 2002 but this Tribunal set aside the decision in July 2003 . The Secretary then paid Mr Theo an amount in respect of arrears. Mr Theo says the Secretary has not calculated the amount correctly, and he claims he is entitled to receive additional amounts in respect of damages and interest. The Secretary subsequently cancelled the pension on 10 September 2003 on the grounds that the applicant failed to provide information as requested. Two subsequent claims for the Age Pension (in October 2003 and April 2004) were rejected on the same basis.  

2.      Mr Theo appealed the first three decisions to the Social Security Appeals Tribunal (the SSAT).  On 22 March 2004 the SSAT decided to affirm the decisions in relation to the calculation of arrears, the cancellation decision and the October 2003 decision rejecting the application for Age Pension.  On 29 June 2004 the SSAT affirmed the decision rejecting the April 2004 application for Age Pension.  The matters were appealed to this Tribunal, and heard together. 

3.      The matters were heard over the course of two days.  The applicant represented himself at the hearing.  The respondent was represented by Mr McQuinlan, a departmental advocate.  The following documents were admitted into evidence:

· The documents compiled pursuant to s 37 Administrative Appeals Tribunal Act 1975 (the T-documents) in relation to matter Q2004/259;

·     The T-documents compiled in relation to matter Q2004/507;

·     A bundle of correspondence between the applicant and respondent;

·     A letter from the applicant to the respondent dated 13 May 2004;

·     The respondent’s statement of facts and contentions;

·     Copies of proof of identity documents (i.e. photocopies of the applicant’s passport, drivers’ licence and bankcard); and

·     A letter from the applicant to the “Officer in Charge” of Kippa-Ring Centrelink.

4.      Mr Theo made lengthy submissions on the law. He raised a number of novel points in the course of his argument. He says the respondent is obliged to pay him the money he seeks. I disagree.  My reasons follow.

Decision regarding calculation of arrears of pension

5.      The respondent paid Mr Theo $11,374 in arrears for the period 27 March 2002 to 1 July 2003 following the Tribunal’s 2003 decision.  He says he is owed more money.

6.      In particular Mr Theo says that the arrears should have been calculated using the rates which prevailed at the time of the calculation (that is, following the decision of the Tribunal), rather than the rates that prevailed during the period 27 March 2002 to 1 July 2003.

7.      The SSAT said:

Section 55 of the Social Security Act 1991 (the Act) says that the rate of age pension for a person who is not permanently blind is worked out using the Pension Rate Calculator at the end of section 1064.

The rate calculator is a complex provision.  It contains a number of modules which are worked through to determine the correct rate of pension.  The starting point of…the module is to work out a person’s “maximum basic rate”.

Sections 1189 and 1190 of the Act are then relevant.  Those sections dictate that a person’s maximum basic rate be adjusted from time to time, in order to allow indexation of the pension in line with the consumer price index.

This process of constantly adjusting the rate of pension in accordance with CPI is mandated by the Act.  The Act does not permit a person who is paid arrears to be paid arrears at current day rates.  That person must be paid the arrears at the rate prescribed by the Act from time to time.

It follows that the Centrelink decision to pay Mr Theo arrears of pension in accordance with the rate of pension payable from time to time in the arrears period is correct and must be affirmed.

8.      The SSAT is right. The payments must be made (and the arrears calculated) with reference to the rates which apply to the period when the payment should have been paid.  I have examined the calculation (it appears at ff212-229 T32 of the T-documents) and agree it is correct.

9.      Mr Theo also argues he should be paid additional amounts by way of compensation and in respect of interest.  The respondent submitted there is no power to pay compensation or interest under the Administrative Appeals Tribunal Act 1975 or the social security legislation.

10.     Mr Theo says the power to order the payments arises out of the common law. He cited the High Court’s decision in Mabo v Queensland (No 2) (1992) 175 CLR 1. He is wrong. Mabo does not contain even the hint of a suggestion that a dissatisfied recipient of a statutory payment is entitled to damages or interest in circumstances like these.

11. My power to order payments is limited to that of the original decision maker: s 43(1) Administrative Appeals Tribunal Act 1975.  The original decision maker did not have the power to award compensation or interest, and neither do I.  It follows the decision in relation to the calculation of arrears must be affirmed.

Decision to Cancel Age Pension

12.     On 8 August 2003 the respondent requested the applicant to provide further information relating to his involvement in the Solon Theo Family Trust (f97 T16 of the T-documents).  They requested a copy of the amendment to the Solon Theo Family Trust Deed, a properly completed Private Trust Module (PT Module) form, and the Income Tax return for the Trust in 2001/2002, as well as its balance sheet and a profit and loss statement.

13.     The applicant replied on 20 August 2003.  He said “…the contents of your letter do not concern the writer, nor the booklet, [referring to the PT Module] which is returned herewith duly noted”.  He put a line through every operative page of the PT Module, writing “N/A” (ff 103-113 T18 of the T-documents).

14.     The respondent then cancelled the Age Pension on 10 September 2003.  The review officer and then the SSAT affirmed this decision.

15. Division 1 of Part 5 of the Social Security (Administration) Act 1999 deals with the Secretary’s information gathering powers in certain circumstances.  Section 192 says:

The Secretary may require a person to give information, or produce a document that is in the person’s custody or under the person’s control to the Department if the Secretary considers that the information or document may be relevant to one or more of the following:
…
(b) the question whether a social security payment is payable to a person who is receiving the payment
…

(d) the rate of social security payment that is or was applicable to a person

16.     I am satisfied the documents requested were in Mr Theo’s possession or under his control.  He was an original Trustee of the Trust, and retains the power to appoint new trustees.  He says he no longer has any involvement with the trust, but I am not satisfied that is the case after hearing him give evidence.

17. Section 196 is a mechanical provision concerning how the Secretary can give notice of a requirement under Division 1. It says:

(1) A requirement under this Division must be made by written notice given to the person of whom the requirement is made.

(2) The notice:

(a) may be given personally or by post or in any other manner approved by the Secretary; and

(b) must specify:

(i) how the person is to give the information or produce the document to which the requirement relates; and

(ii) the period within which the person is to give the information or produce the document to the Department; and

(iii) the officer (if any) to whom the information is to be given or the document is to be produced; and

(iv) that the notice is given under this section.

(3) The period specified under subparagraph (2)(b)(ii) must not end earlier than 14 days after the notice is given.

18. The notice given by the Secretary in this case can be found at T16 f97 of the T-documents. It specifies the information the applicant must provide, and the manner in which it must be provided. It specifies the notice is given under s 196 Social Security (Administration) Act 1999.  The letter says “You will need to contact us or supply the documents within 14 days after the day on which this letter is given to you”.  This satisfies subsection 3.

19. I am therefore satisfied that written notice of the s 196 request for information was validly given.

20. Section 81 Social Security (Administration) Act 1999 says that if a person in receipt of a social security payment (other than a Newstart payment) fails to comply with a notice embodying a requirement under Division 1 of Part 5 of that Act, the Secretary may determine that the payment be cancelled or suspended. The Secretary decided to exercise that discretion here.

21.     There are two questions for this Tribunal.  First, did Mr Theo’s response amounted to a failure to comply with the notice?  Second, was the Secretary right to exercise the discretion to cancel the Age Pension? 

22.     Mr Theo did not fill out the PT module, but crossed out its pages and wrote “NA” on them.  Nor did he provide any other information requested by the respondent.  Rather he simply indicated that he did not believe the request for information concerned him.  This amounts to a failure to comply with a validly given notice.  The Secretary’s discretion to cancel the Age Pension is enlivened.  The Secretary’s decision to exercise that discretion was the correct and preferable decision in the circumstances.  I can see no reason why the discretion to cancel the payment should not be exercised in this case. 

23.     The decision to cancel Mr Theo’s Age Pension should be affirmed.

Decision to reject claim for age pension (October 2003)

24.     On 6 October 2003 Mr Theo claimed the Age Pension again.  In response to this claim the respondent requested he provide further information: T44 f272 of the T-documents.  The information requested was:

(a)a completed Module S;

(b)a completed Module PT;

(c)proof of identity; and

(d)bank statement showing balance as at 6 October 2003.

25.     Mr Theo provided proof of identity (exhibit 6) but did not provide the Module S or Module PT forms, nor a bank statement. 

26. In a letter to Mr Theo dated 14 October 2003, the respondent reiterated the request for the information made pursuant to s 196 of the Act (T46 ff274-275). The letter gave Mr Theo until 28 October 2003 to comply.

27.     On 15 October 2003 Mr Theo wrote a letter in response (T47 ff276-278).  Mr Theo claims a constitutional right to the Age Pension. He also relies on the doctrine of estoppel.  He provided proof of identity.  Regarding the completion of the Modules he wrote:

In regard to the forms you expect the writer to complete, please accept the copies of the similar forms submitted to you on the 20.8.03, which apparently you chose to ignore.

28.     I understand this to be a reference to the Module PT he submitted in August 2003 (that he returned with N/A written over it).  Regarding the bank statement he wrote:

I cannot oblige with your request for a bank statement as I do not own one.

29.     On 31 October 2003 the respondent decided to reject Mr Theo’s claim for Age Pension: T50 f284.

30.     The questions for this Tribunal are as follows:  did Mr Theo receive valid notice of the request for information?  If so, did he fail to comply with the notice?

31. I am satisfied the notice complies with s 196 of the Social Security (Administration) Act 1999. It is therefore a valid notice.

32. Section 37 of the Social Security (Administration) Act 1999 says:

Subject to section 40, the Secretary must determine that a claim for a social security payment is to be granted if the Secretary is satisfied that:

(a) the claimant is qualified for the social security payment; and

(b) the social security payment is payable.

33. Section 63 of the Social Security (Administration) Act 1999 gives the Secretary the power to require a person to provide information.  It also provides for the consequences of a failure to provide information.  It says:

63(1) This section applies to a person if:

(a)either

(i)the person is receiving, or has made a claim for, a social security payment; or

(ii)the person is the holder of, or has made a claim for, a concession card; and

(b)the  person is not a person to whom section 64 applies.

63(2) If the Secretary is of the opinion that a person to whom this section applies, other than a person to whom subsection (3) applies, should:

(a)       attend an office of the Department; or

(b)       contact the Department; or

(c)       attend a particular place for a particular purpose; or

(d)       give information to the Secretary;

The Secretary may give the person written notice that he or she is required, within a specified time, to:

(e)attend that office; or

(f)contact the Department; or

(g)attend that place for that purpose; or

(h)give that information;

as the case may be.

…

63(4) If

(a)       a person is receiving, or has made a claim for, a social security payment; and

(b)       the Secretary gives the person a notice under subsection (2); and

(c)       the requirement of the notice is reasonable; and

(d)       the person does not comply with the requirement;

The following paragraphs have effect:

…

(f)        in any other case, the payment that the person is receiving or has claimed is not payable.

34.     Clearly this section is applicable to Mr Theo as he is a person who has made a claim for a social security payment.  He is not a person to whom s 64 applies. (Section 64 deals with incapacitated persons.)

35. Mr Theo’s failure to submit a completed Module PT form amounts to a failure to comply with a valid request for information. That means the payment he claimed is not payable: s 63(4).

36.     The decision to reject the claim for Age Pension of 31 October 2003 is therefore affirmed.

Decision to reject claim for age pension (April 2004)

37.     On 8 April 2004 Mr Theo again claimed the Age Pension.  In response to this claim, on 14 April 2004 the respondent again requested he provide further information: T7 f57 of the T-documents.  The information requested was much the same as that requested in October 2003:

Proof of Arival [sic] and 100 points of identity;

Proof of all Bank account balances as on 8 April 2004;

Completed Module PT;

Completed Module S;

Bank account and BSB number;

Details of accommodation.

38.     Mr Theo replied to the letter on 16 April 2004 (T8 f58-59).  In relation to the information requested he relevantly replied:

i) I do not have a bank account – I shall endeavour to establish same.

ii) I am not familiar with the meaning of the acronym “BSB” you have used, consequently I cannot oblige.

iii) Re accommodation:

Because of you having deprived me of my legal and lawful entitlement to an age 

pension, I cannot afford and do not have a permanent place of abode.
…

In regard to your request relevant to form referred to as: Module PT.  Please refer to YOUR question No.: D1 (within the form named: “Income and Assets form”)

My comments in regard to the said question are EXPLICIT, and I do not fall in the category, of having to comply with your irresponsible request.  Therefore it will be appreciated if you refrain yourselves in asking for details that do not concern my case.

…

In regard to your request relevant to Module S

“Even blind Freddie” will realise that 99.99999% of the information you request should exist in your files.  For this reason I consider your relevant request as being contemptuous.

39.     The tone of this letter is repeated in a subsequent file note written by a Centrelink officer, who spoke to Mr Theo over the phone on 20 April 2004 (T10 f63).  The officer records:

I was then able to clarify that he refuses to provide a PT or S module as he states these mods are irrelevant to him.

40.     (This officer was not cross-examined on the record.  However there is nothing to suggest, either in the evidence before me or in Mr Theo’s submissions, that this record was inaccurate). 

41.     On 4 May 2004 the respondent decided to reject Mr Theo’s claim on the basis that he failed to supply proof of his identity (T11 ff64-65).

42. The relevant law is covered above at par 31-34. I am satisfied the written request for information complied with s 196 Social Security (Administration) Act 1999. I am also satisfied that Mr Theo failed to comply with the request: s 63(4) Social Security (Administration) Act 1999.  The respondent was correct to refuse Mr Theo’s claim for the Age Pension.  That decision must be affirmed.

Other Matters

43.     Mr Theo said he was not obliged to comply with the Social Security (Administration) Act 1999.  He said the Act was constitutionally invalid, as it was inconsistent with the Income Tax Assessment Act 1936.  I will briefly explain why those submissions are wrong, although strictly speaking it is not necessary for me to do so because a Tribunal does not have the power to declare legislation invalid. That would amount to an exercise of judicial power, and the Tribunal is not a judicial body: see Re Adams and the Tax Agents’ Board (1976) 12 ALR 239 at 241-242 per Brennan J.

44.     There is no question the Commonwealth parliament has the power to make laws with respect to taxation (s 51(ii) of the Constitution) and social security (s 51(xxiii) and (xxiiiA) of the Constitution). Even if I were convinced the two statutes are inconsistent – which I am not – there are well established rules for resolving the ambiguity.

45.     As a general proposition, a later statute will prevail over the words of an earlier statute. Parliament is assumed to have been aware of the earlier law. It is unlikely to have contradicted itself: see Butler v Attorney-General (Vic) (1961) 106 CLR 268 at 276 per Fullagar J. It follows that whatever the Income Tax Assessment Act 1936 had to say on the topic of aged pensions, the later specific legislation dealing with the same matter will prevail. There is no reason to doubt the later legislation would do so in this case, assuming any inconsistency between the two statutes can be identified.

Conclusion

46.     All of the decisions under review must be affirmed.

I certify that the 46 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member McCabe

Signed:         [Sgd]
  Associate:  Thomas Ritchie

Date/s of Hearing: 9 August 2004, 22 September 2004.            

Date of Decision: 1 December 2004
The applicant represented himself.
The respondent was represented by Mr McQuinlan, a departmental advocate.