Ulloa and Secretary, Department of Family and Community Services

[2004] AATA 177

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 177

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2003/463 &

GENERAL ADMINISTRATIVE  DIVISION

)              N2003/464

Re

1) ENRIQUE ULLOA

2) GEORGINA ULLOA

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Mr S Webb, Member

Date4 February 2004

PlaceWollongong

Decision For the reasons given orally at the conclusion of the hearing, the Tribunal affirms the decisions under review.

[sgd] S Webb
   Member

CATCHWORDS

SOCIAL SECURITY – over payment of disability support pension and wife pension due to understatement of wife’s income - recovery of debt - no special circumstances - decision affirmed

REASONS FOR DECISION

Mr S Webb, Member     

1. At the conclusion of the hearing of the above matter the terms of the decision intended to be made and the reasons therefor were stated orally. Pursuant to sub‑section 43(2A) of the Administrative Appeals Tribunal Act 1975 the Applicants requested the Tribunal to provide a statement in writing of the reasons of the Tribunal for its decision.

2.      The oral reasons for decision have been transcribed by Auscript, the Commonwealth Reporting Service. 

3.        The transcript annexed hereto, with appropriate minor editing, sets out the reasons for the decision.

I certify that this and the preceding page are a true copy of the decision and reasons for decision herein of:

Mr S Webb, Member

Signed:         

Associate

Date of Hearing  4 February 2004

Date of Decision  4 February 2004

Representative for Applicant      Self-represented

Solicitor for Respondent              Ms M Buckley, Advocate

ADMINISTRATIVE APPEALS TRIBUNAL
Matter No N2003/463-464
By MR S. WEBB, Member
ULLOA -v- DEPARTMENT OF FAMILY AND
COMMUNITY SERVICES
WOLLONGONG, WEDNESDAY, 4 FEBRUARY 2004

MR WEBB:   Now, Mr and Mrs Ulloa you have applied for review of a decision by the Social Security Appeals Tribunal dated 12 February 2003 to recover debts raised by Centrelink following overpayments to you in respect of your wife's pension, Mrs Ulloa and your disability support pension, Mr Ulloa.

I have considered all of the evidence and the various submissions that have been made to me today and I find that your have been overpaid wife’s pension and disability support pension. I am satisfied that the debts that have been raised against you are correctly raised under section 1223 of the Social Security Act 1991. The amount of the debts, which you are currently repaying, are, for Mr Ulloa, an amount of $4,753.40 for the period 27 June 1997 to 24 June 1999 and an amount of $3,758.60 for the period 7 July 1999 to 9 April 2002.

Mrs Ulloa, the amount of your debts are $4,753.40 from 27 June 1997 to 24 June 1999 and $6,085.17 from 7 July 1999 to 9 April 2002.  I note that those amounts are not in dispute and that the outstanding balances of the debts are somewhat lower because you have been repaying the debts.

All right, now, I find that the debts have arisen as a result of overpayment of pensions.  The overpayments occurred because Mrs Ulloa’s earnings from the Garrawarra Centre were incorrectly declared.  Mrs Ulloa’s earnings varied from week to week in accordance with her entitlements and hours of work.  Those variations were not declared to Centrelink.  In consequence, pensions were calculated on the declared rather than the actual earnings and overpayments accrued over the relevant periods. The debts have arisen as a result.  That much is not in dispute.  I accept that Mr and Mrs Ulloa intended to comply with their legal obligations under the Act and thought they had done so.  They were under the impression that there was no need to declare the minor variations in Mrs Ulloa’s weekly earnings as the amount of her earned income would “balance out” overall.  They were also under the common misconception that her employer would inform Centrelink of the actual amounts.  The fact is it did not and Mrs Ulloa’s income was understated during the periods in question.

The question that remains is whether those debts should be recovered by the Commonwealth. The Social Security Act 1991 sets out the various circumstances in which this Tribunal is able to consider whether to write off or to waive debts that have been raised.

Debts may be written off under section 1236 of that Act in certain circumstances.  I am satisfied, having looked at those criteria and having considered the facts of this case, that the debt cannot be written off.  In other words your whereabouts are known and even though it's difficult for you, you have some capacity to repay the debt.  The debt is recoverable at law and it is cost effective to do so. 

That leads me to section 1237 (AAD) of the Social Security Act concerning the waiver of a debt in special circumstances. I find on the evidence that you are in straitened financial circumstances, that your income from the Garrawarra Centre is just sufficient, barely, to cover the costs of your living expenses and so forth.

Mr Ulloa, I accept your evidence that you are not able to find paid employment, as you've said, because you have a language problem, you have a hearing problem and your age is against you.  Your sole income, as far as I can see, is from the disability support pension, the entire amount of which is being used for the purpose of repaying the debt.  It follows that you are dependent upon your wife’s income from the Garrawarra Centre.  Mrs Ulloa I accept what you say that after paying your combined monthly living expenses you may have only $100 left over.

Now, I also accept what you say in terms of your health circumstances and, Mr Ulloa, that you have depression.  I don't know whether Crixivan is an effective treatment for you or not but I accept that it is an anti depressant treatment that's been prescribed for you.  I also accept what you told me about your medical problems, Mrs Ulloa, in relation to your ulcer, but otherwise conclude that both of you are in reasonable health.  I note that you own your own house and that you have a mortgage of $4,000.   I also note that you have a credit card debt of approximately $6,000 and a debt relating to the purchase of furniture following a flood of approximately $4,000 but other than that you have no other liabilities.

Taking these circumstances into account, I cannot find in your favour that those are special circumstances under the Act. Under the Act the Federal Court and Tribunals over time have considered the question of special circumstances for the purpose of waiving a debt (see Re Beadle and Director-General of Social Security (1984) 6 ALD 1). It is, as I said to you before, effectively an interest free loan that should be repaid unless there are special circumstances, that is circumstances that are unusual, uncommon or exceptional. The Federal Court has made it clear that the taxpayer should expect that a debt relating to an overpayment should be repaid unless such circumstances exist (see Secretary, Department of Social Security v Hales (1998) 82 FCR 154). Where the Federal Court has said that it may be justified not to recover the debt, albeit in different circumstances, is where something unfair, unjust or unintended occurs as a result of the application of the law.

Now, in your circumstances I accept that you are in a difficult situation.  I accept you are having difficulties in your marriage. I accept that culturally it's difficult for you to deal with the fact that Mr Ulloa is not the bread-winner in your family.  However, you are earning, Mrs Ulloa, you are in employment.  Your earnings are sufficient to cover your combined living expenses.  You own your own home and have some health problems, but those problems are not exceptional.  While difficult, those circumstances are not special to the extent that the taxpayer should bear the cost of the overpayment that was made to you. 

So unfortunately I can't find in your favour.  Considering the evidence and the entirety of your circumstances I am compelled to find that the decision under review must be affirmed and that the debts must be repaid.  As I said to you previously, there may be scope if your circumstances change and your financial situation becomes more difficult for you to re-negotiate the rate at which the debt is to be repaid.  It is currently being repaid at the rate of $75.00 per fortnight, paid by you Mrs Ulloa, and by recovery from your disability support pension, Mr Ulloa, to the full extent of that pension.  If your circumstances change then you may be able to re-negotiate the rate at which the debt is to be repaid, but my decision is that the decision under review must be affirmed.