Ugochukwu v Secretary, Department of Family and Community Services

[2000] FCA 1437

FEDERAL COURT OF AUSTRALIA

Ugochukwu v Secretary, Department of Family & Community Services
[2000] FCA 1437

PRACTICE & PROCEDURE – application to set aside judgment dismissing proceeding where applicant failed to appear at directions hearing – necessity to show arguable case if judgment set aside.

COSTS – whether lack of resources is justification for departure from usual rule that costs follow event.

Federal Court Rules, O 10 r 3(2), O 35 r 7(2)(a)
Administrative Appeals Tribunal Act 1975 (Cth), s 44(1)
Social Security Act 1991 (Cth), ss 613(1), 1224(1), 1237A(1), 1237AAD

Registrar of Aboriginal Corporations v Murnkurni Women’s Aboriginal Corporation (1995) 58 FCR 125 referred to
Jones v TR Flanagan Smash Repairs Pty Ltd [2000] FCA 1232 referred to

CASIMIR UGOCHUKWU v SECRETARY, DEPARTMENT OF FAMILY
& COMMUNITY SERVICES

N 147 of 2000

KATZ J
SYDNEY
6 OCTOBER 2000

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N147 of 2000

BETWEEN:	CASIMIR UGOCHUKWU APPLICANT
AND:	SECRETARY, DEPARTMENT OF FAMILY  & COMMUNITY SERVICES RESPONDENT
JUDGE:	KATZ J
DATE OF ORDER:	6 OCTOBER 2000
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The motion be dismissed.

2.The applicant pay the respondent’s costs of the motion.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N147 of 2000

BETWEEN:	CASIMIR UGOCHUKWU APPLICANT
AND:	SECRETARY, DEPARTMENT OF FAMILY & COMMUNITY SERVICES RESPONDENT

JUDGE:	KATZ J
DATE:	6 OCTOBER 2000
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. There is before the Court a motion seeking an order identified in the notice of motion filed as an order that a directions hearing be held in the proceeding.

2. It is apparent that that motion as framed is misconceived, since, in circumstances about to be described, the proceeding has already been dismissed with costs.

3. However, O 35, par 7(2)(a) of the Federal Court Rules (“the FCRs”) confers on the Court power in the present circumstances to set aside its judgment dismissing the proceeding and I propose to treat the motion as one seeking an order under that provision of the FCRs.

4. The background to the motion is that Mr Casimir Ugochukwu instituted in the Court an appeal against a decision of the Administrative Appeals Tribunal (“the AAT”) under subs 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth). Mr Ugochukwu’s appeal came on before me for directions in the ordinary way, but, Mr Ugochukwu having failed to appear, I dismissed his appeal with costs under O 10, subr 3(2) of the FCRs.

5. In support of his motion to set aside my judgment dismissing his appeal, Mr Ugochukwu has relied on three affidavits directed to showing an adequate explanation for his non-appearance at the directions hearing, two of his own and one of Mr Ignatius Asuzu.

6. However, whether or not he has an adequate explanation for his non-appearance at the directions hearing seems to me to be of little moment in the present case.  That is because I would not set aside my earlier judgment unless satisfied by Mr Ugochukwu that, if I were to do so, his appeal would be an arguable one: compare Registrar of Aboriginal Corporations v Murnkurni Women’s Aboriginal Corporation (1995) 58 FCR 125 (RD Nicholson J); and that he has failed to do.

7. In summary, the AAT’s decision the subject of the appeal was that: (1) Mr Ugochukwu had received between 3 March 1997 and 4 July 1997 payments of newstart allowance to which he had not been entitled; (2) those overpayments were owed by Mr Ugochukwu as a debt to the Commonwealth; (3) the Commonwealth’s right to recover Mr Ugochukwu’s debt to it was not required to be waived; and (4) the Commonwealth’s right to recover Mr Ugochukwu’s debt to it was not permitted to be waived. As to (1), Mr Ugochukwu had not been entitled to the payments of newstart allowance because, at the relevant time, he had been enrolled in a full-time course of education: see subs 613(1) of the Social Security Act 1991 (Cth) (“the Act”). As to (2), those overpayments were owed by Mr Ugochukwu as a debt to the Commonwealth because they had been made to him on the basis of false representations made by him in his applications for payment of newstart allowance, made on form SU19: see subs 1224(1) of the Act. Those false representations had been that he had not studied in a full-time course during the relevant period. As to (3), the Commonwealth’s right to recover Mr Ugochukwu’s debt to it was not required to be waived, because the debt was not solely attributable to an administrative error made by the Commonwealth: see subs 1237A(1) of the Act. As to (4), I will discuss it further below.

8. Mr Ugochukwu’s notice of appeal which instituted the present proceeding specified what were said to be two questions of law raised on his appeal:

   “The Tribunal erred in its interpretation of the expression ‘special circumstances (other than financial hardship alone)’ in para (b) of s. 1237AAD of the [Social Security] Act[.]
   The Tribunal erred in [not] find[ing] that the circumstances of the applicant constituted ‘special circumstances’ within the meaning of para (b) of s. 1237AAD of the Act[.]”

   It is apparent that the words which I have just quoted did not, in truth, specify questions of law raised on Mr Ugochukwu’s appeal, but rather specified alleged grounds of appeal.  However, nothing turns on that distinction for present purposes.  Nor, I should add, did the alleged grounds of appeal actually specified later in Mr Ugochukwu’s notice of appeal add anything of present relevance to his recitation of the questions of law alleged to be raised on his appeal.

9. Section 1237AAD of the Act, to which both of Mr Ugochukwu’s two alleged questions of law relate, provides:

   “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 a 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.”

10. As I pointed out to Mr Ugochukwu during argument, it is apparent that the power conferred on the Secretary by s 1237AAD of the Act is only permitted to be exercised if the Secretary is satisfied of each one of three different matters. In other words, pars (a), (b) and (c) of the section operate cumulatively.

11. Mr Ugochukwu sought to attack in his notice of appeal only the Secretary’s failure to be satisfied of the second of the three matters set out in s 1237AAD, that set out in par (b).

12. However, it is apparent from the AAT’s statement of findings and reasons that the AAT, as well as not being satisfied of the second of the three matters set out in s 1237AAD, that set out in par (b), was also not satisfied of the first of the three matters set out in s 1237AAD, that set out in par (a).

13. The AAT stated,

    [Section] 1237AAD(a) raises the question whether the Applicant ‘knowingly’ made a false statement.  The meaning of ‘knowingly’ in this section was discussed by the Tribunal in Re Callaghan [(1996) 45 ALD 435]. Deputy Registrar Forgie stated (at 445):

    (48)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…. That actual knowledge is ascertained by reference to the statements of the person as to his or her actual state of knowledge at the time and to events surrounding the false statements….

    The Tribunal has already stated above that it does not consider that there was any fraudulent intent on the Applicant’s part – rather that he was foolish in answering the SU19s as he did.  However, the Tribunal finds that he must have been aware that his answer was incorrect – the Applicant himself acknowledges that he was enrolled in a course of education designated by UTS [that is, the University of Technology Sydney] as ‘full-time’.”

14. Having made the statement which I have just quoted, the AAT then continued,

    “However, even if the Applicant did not knowingly make the false statements, in the Tribunal’s view, ‘special circumstances’ have not been made out which make it desirable to exercise the power of waiver (s 1237AAD(b)).”

    The AAT then went on to discuss at some length the construction and application of par 1237AAD(b) of the Act.

15. Thus, even if Mr Ugochukwu could make good some complaint of legal error on the AAT’s part in reaching the conclusion which it did as to par (b) of s 1237AAD of the Act, that legal error would be an immaterial one in the circumstances, he not having sought to raise in his notice of appeal any ground of legal error on the AAT’s part in reaching the conclusion which it did as to par (a) of s 1237AAD of the Act.

16. In those circumstances, I am, as I have already said, not satisfied that, if I were to set aside my earlier judgment, Mr Ugochukwu’s appeal would be an arguable one.  Accordingly, I dismiss his motion with costs.

17. I include this paragraph by way of addendum to the above paragraphs, which paragraphs reproduce the reasons that I delivered orally on the day of the hearing of Mr Ugochukwu’s motion.  My order that Mr Ugochukwu pay the respondent’s costs of his motion was made over his opposition, which opposition was in substance based on his straitened economic circumstances.  Literally within minutes of my making that order, there was released to me the decision of a Full Court of this Court in Jones v TR Flanagan Smash Repairs Pty Ltd [2000] FCA 1232 (Beaumont, Whitlam and Emmett JJ, 28 August 2000, unreported). In that decision, Beaumont J, with the concurrence of Whitlam and Emmett JJ, had said (at [5]), “[A] lack of resources cannot by itself, in my view, constitute a reason for departing from the usual rule” that costs follow the event.  It had been on that express basis that I had made the costs order which I made against Mr Ugochukwu, although without being aware at the time of the Full Court’s pronouncement on the matter.

I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Katz.

Associate:

Dated:             6 October 2000

The Applicant appeared in person.
Solicitor for the Respondent:	Australian Government Solicitor
Date of Hearing:	6 October 2000
Date of Judgment:	6 October 2000