Tran and Secretary, Department of Education, Employment and Workplace Relations

[2010] AATA 664

Administrative Appeals Tribunal

ORAL DECISION AND WRITTEN REASONS [2010] AATA 664

ADMINISTRATIVE APPEALS TRIBUNAL      )

)           No  2009/6053

GENERAL ADMINISTRATIVE DIVISION	)
Re	PHONG TRAN

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

ORAL DECISION

Tribunal M J Carstairs, Senior Member

Date12 August 2010

PlaceBrisbane

Decision The Tribunal sets aside the decision under review and remits the matter to the respondent for reconsideration in accordance with the direction that Mr Tran did not dispose of an asset within the meaning of s 1123 of the Social Security Act 1991 and his claim for newstart allowance should be assessed accordingly.

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

Senior Member

CATCHWORDS

SOCIAL SECURITY – Newstart allowance – Entitlement – Disposal of asset – Separation from de facto spouse – Payment of money under separation agreement – Payment finalising obligation to former de facto spouse – Consideration in money or money’s worth – Decision under review set aside.

Social Security Act 1991 (Cth), s 1123

WRITTEN REASONS FOR DECISION

2 September 2010  M J Carstairs, Senior Member                 

1. This matter concerns Mr Tran’s application for newstart allowance.  He was refused this payment because Centrelink decided that he had gifted an amount of $250,000 without receiving any consideration for it.  Under the Social Security Act 1991 (“the Act”), a person who disposes of an asset without consideration still has the asset’s value taken into account when assessing the rate of their payment.

2. The relevant assets limit for the payment of newstart allowance at the time of Mr Tran’s claim was $171,750.   He therefore had exceeded the limit for any payment of newstart allowance by disposing of the amount of $250,000.

3. I have heard the evidence of Mr Tran and the evidence from his lawyer, Mr T Nguyen, who assisted him when he came to sell his house at Woolloongabba in 2008.  Mr Nguyen also provided some advice to Mr Tran in 2010 that broadly relates to the disputed $250,000.  I am satisfied that this sum of money was part of the settlement of Mr Tran's previous de facto relationship and was not a disposal

   
   

   without consideration. 

4. At the hearing, Mr Tran was assisted by an interpreter in the Vietnamese language, Mr Vu.  I gave my reasons orally after the hearing, assisted by Mr Vu.  Mr R Hamilton, for the respondent, later asked for written reasons.  These reasons answer that request.

5. Turning first to the evidence.

   EVIDENCE

6. Mr Tran told me that he had lived at the house at Woolloongabba prior to its sale.  Therefore, this house was at that time his principle place of residence. He had separated from his partner in about 2006.  According to Mr Tran’s evidence, after the separation his ex-partner harassed him for payment and often used their children by getting them to telephone him to repeat her insistence that he do something about providing money. 

7. It was in this context that the document set out at T12 came into existence.  Mr Tran was not a signatory to that document.  He told me in evidence that his son Anthony had drafted it at the time as a record.   This included the final line of the document, that, “From then on there will be no conflict between the two parties with respect to money”.  T12 reads:

   From selling the house located at … Woolloongabba, Phong Tran will be giving [here Mr Tran’s five children were named] fifty thousand dollars ($50,000) each which is a total of two hundred and fifty dollars ($250,000) [sic] for their investment of a new house.  From then on there will be no conflict between the two parties with respect to money.

8. Although not indicated in the document at T12, I understand from the evidence that Mr Tran and Ms Truong were the parties of the de facto relationship.  I would pause here to say that I do accept that Mr Tran was giving an honest account of how he saw the relationships in his family.  His partner may have a different view, but this does not detract from the fact that this was the way in which Mr Tran saw things. I recognise that the Social Security Appeals Tribunal seemed to suggest that he gave several versions of the story and his credit seemed to be in issue with them.  My impression was that he struggles with English and needs the aid of an interpreter in Vietnamese (and not that he was dissembling).  He also only limited knowledge of legal issues in this country.

9. After the Social Security Appeals Tribunal rejected his case, Mr Tran approached the Welfare Rights Centre.  They suggested he seek legal advice from his solicitor, Mr Nguyen, about the document at T12.

10. In that regard, his solicitor attempted to formalise the agreement at T12 as a separation agreement under s 270 of the Property Law Act 1974 (Qld). However this has not transpired, because Mr Tran’s former de facto spouse has refused to sign. Mr Hamilton suggested that Mr Tran was only attempting to formalise the agreement to ensure his entitlements to newstart allowance. Of course this may be a motive, but it does not detract from his attempt being genuine.

11. I accept that the agreement at T12 was an attempt by Mr Tran to finalise the property matters between himself and his former de facto spouse. I accept that his motive at the time of handing over the money was, as he stated it to be, to obtain some peace from his former partner and to stop the use of the children to constantly harass him about these issues.

12. Mr Nguyen carefully explained the nature of a letter he provided to the respondent dated 22 April 2010.  He said that he had assisted with the legal aspects of the house sale in 2008, at which time Mr Tran did not discuss with him that there might have been a property settlement involved.  This is reflected in Mr Nguyen’s letter.

13. Mr Nguyen explained in this letter, and also at the hearing, what would have likely happened if Mr Tran’s former partner had attempted to take further action in the Family Court and there had been neither an agreement of the kind represented at T12 nor the transfer of $250,000. 

14. He explained the greater benefits and clarity afforded by a “Recognised Agreement” (as is referred to in s 270 of the Property Law Act 1974 (Qld)). Mr Nguyen made plain that T12 was still an agreement, but not one with the clearer advantages of the more formal agreement that Ms Truong refused to sign.

15. Mr Nguyen recorded his opinion as follows:

    You and Ms Truong were entitled to enter into a separation or recognised agreement at any time after the separation by consent.  It is only in relation to court proceedings that the 2 year limitation (unless hardship) applies.

    Therefore it is our opinion that you did receive valuable consideration for transferring her the money pursuant to the separation agreement dated 8/8/08 and in our opinion Ms Truong no longer has any enforceable legal rights against you.[1]

    [1] Exhibit A1.

16. Mr Nguyen told me he believed, given Mr Tran had paid the $250,000 to Ms Truong, that she would face great difficulty in attempting to take further action now.  Mr Nguyen agreed with my point, expressed to him as a question during the hearing, that the $250,000 had effectively become Ms Truong’s settlement, given the effluxion of time.

    CONSIDERATION

17. Section 1123 of the Act states, relevantly:

    1123    Disposal of assets

    (1) For the purposes of this Act, a person disposes of assets of the person if:

    (a) the person engages in a course of conduct that directly or indirectly:

    …

    (ii)    disposes of all or some of the person’s assets; or

    (iii)  diminishes the value of all or some of the person’s assets; and

    (b)  one of the following subparagraphs is satisfied:

    (i)the person receives no consideration in money or money’s worth for the destruction, disposal or diminution;

    (ii)the person receives inadequate consideration in money or money’s worth for the destruction, disposal or diminution;

    …

18. Taking into account all the evidence, it seems to me that Mr Tran did receive consideration in money or money’s worth.  He had some obligation to his past relationship and the offspring of that relationship.  That obligation is recognised by the informal agreement.   The advantage that he has obtained (and I would note this is as best we can ascertain on the facts here) is that his property matters that otherwise might have been more formally settled in the Family Court have been finally dealt with.  The amount that was transferred to his family by his handing over the $250,000 would be taken into account even if action were attempted now by his ex-partner.

19. In other words, I am satisfied that the agreement at T12 was Mr Tran’s attempt, unaided by legal assistance and battling his language impediment, to settle his legal obligations.  The consideration for transferring the money is as expressed at T12: that it would bring the conflict within the family to an end.  Its value is clearly evidenced by what Mr Nguyen told me.  In that regard I would say that the fact it was given through a payment to one of the children should be understood in the context of Mr Tran’s evidence that he was trying to keep the money from being lost to Ms Truong’s gambling habit.

20. Welfare Rights Centre had guided Mr Tran to Centrelink’s Guide to Social Security Law at section 4.1.5, which refers to when a person gives away property in a relationship breakdown.

21. This is a case in which I regard it important to take into account the language and cultural differences at play.  It is also important to keep in mind that this is not a case to be decided under the Property Law Act 1974 (Qld). Its provisions give some general guidance to the principles that must apply to settlements in de facto relationships. Ultimately, however, the question I have to answer is contained in

    
    

    s 1123 of the Social Security Act1991: did Mr Tran engage in conduct to dispose of his assets where he received no or inadequate consideration?  As I have set out, I do accept that Mr Tran received consideration.  That consideration was to finalise, or attempt to finalise, his obligations to his former de facto spouse.  His was an unusual way to proceed, but is a course explained by Mr Tran’s evidence and understandable in his circumstances. 

22. Accordingly, I would set aside the decision under review and remit the matter to the respondent for reconsideration in accordance with the direction that Mr Tran did not dispose of an asset within the meaning of s 1123 of the Act and his claim for newstart allowance should be assessed accordingly.

23. This remittal allows Centrelink the opportunity to assess all aspects of Mr Tran’s entitlement to newstart allowance, since the question before me is not the only question which might be in issue.  There are many bases which a person has to satisfy to qualify for this payment.  Centrelink has to be given the opportunity to make sure all grounds of entitlement are met.

DECISION

1. The Tribunal sets aside the decision under review and remits the matter to the respondent for reconsideration in accordance with the direction that Mr Tran did not dispose of an asset within the meaning of s 1123 of the Social Security Act 1991 and his claim for newstart allowance should be assessed accordingly.

I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of M J Carstairs, Senior Member.

Signed:  ............................[Sgd]...........................................
  Mátyás Kochárdy, Associate

Date of Hearing  12 August 2010
Date of Oral Decision  12 August 2010
Date of request for Written Reasons          16 August 2010
Date of Written Reasons  2 September 2010
The Applicant was self-represented          

Interpreter for the Applicant                         Mr D Vu, Queensland Interpreting and Translating Service

Solicitor for the Respondent  Mr B Hamilton, Centrelink Advocacy Branch