Vallas and Secretary, Department of Family and Community Services

[2002] AATA 1186

DECISION AND REASONS FOR DECISION [2002] AATA 1186

ADMINISTRATIVE APPEALS TRIBUNAL      )

)     No  N2002/149

GENERAL ADMINISTRATIVE DIVISION          )          

Re      CHRISTOPHER VALLAS

Applicant

And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES        

Respondent

DECISION

Tribunal       Senior Member M D Allen

Date4 November 2002

PlaceSydney

ADMINISTRATIVE APPEALS TRIBUNAL  )         No N2002/149
  )  
GENERAL ADMINISTRATIVE DIVISION     )

Re:     CHRISTOPHER VALLAS

Applicant

And:     SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal              Senior Member M D Allen

Date  4 November 2002

Place                   Sydney

DecisionFor the reasons given orally at the conclusion of the hearing in this matter the decision under review is AFFIRMED.

(Sgd)   M.D. ALLEN

.............................

Senior Member
CATCHWORDS

SOCIAL SECURITY – Disability Support Pension and Hardship Provisions - Applicant in receipt of rent from a property owned by him although an unrecognisable asset – As rents equal to pension amount no hardship.

Social Security Act 1991 – s1129

Arcibal v Secretary, Department of Family and Community Services [2002] FCA 1313

REASONS FOR DECISION

Senior Member M D Allen

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. After service upon the Applicant of a copy of the decision that was in fact made, the Applicant pursuant to Sub-section 43(2A) of the Administrative Appeals Tribunal Act 1975 requested the Tribunal to furnish to the Applicant a statement in writing of the reasons of the Tribunal for its decision.

1. The oral reasons for decision have been transcribed by Auscript, the Commonwealth Reporting Service.  Whereas those oral reasons may reflect the inelegance of an extempore decision, they are in fact the reasons for the said decision.

1. The said transcript is annexed hereunto and furnished to the Applicant and to the Respondent, as it is the reasons for the Tribunal's decision.

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

Senior Member M D Allen

Signed:         
          ..................................................................................……………………………….

Associate

Dates of Hearing  28 August 2002 and 4 November 2002
Date of Decision  4 November 2002

Solicitor for Applicant                  Applicant was self-represented
Counsel for Respondent            Mr J Kenny

AUSTRALIAN APPEALS TRIBUNAL
Matter No N2002/149
By  MR M.D. ALLEN, Senior Member
VALLAS and SECRETARY, DEPARTMENT
OF FAMILY AND COMMUNITY SERVICES
SYDNEY  MONDAY, 4 NOVEMBER 2002

MR ALLEN:   In this matter the applicant pursuant to an application lodged with the tribunal on the 4th day of February 2002 sought review of a decision by a Social Security Appeals Tribunal which decision, dated 3 January 2002 affirmed a prior determination to reject the applicant's claim for a disability support pension under the hardship provisions.  The matter came on for hearing before me on the 28th day of August 2002 and the 4th day of November 2002.  At that hearing the applicant appeared himself although he was accompanied by Mr B. White from the Protective Service Commission.

I might put on record now that Mr White has been of material assistance to the tribunal.  The respondent was represented by Mr J. Kenny of Centrelink and as usual Mr Kenny has taken a responsible attitude to this matter and has adopted a far from adversarial stance.  Both Mr Kenny and Mr White have worked to advance the best interests of Mr Vallas.  I say that because Mr Vallas unfortunately suffered brain injury in a motor vehicle accident in 1987, consequently, some aspects of these proceedings I feel even now have not been totally clear to Mr Vallas through no fault of his own.

The situation as it resolved itself before me became relatively simple as a matter of law although obtaining the facts necessary for my decision involved some investigation and discussion.  The background is that following his motor vehicle accident, the applicant received an award of damages.  Because of his situation his affairs are now handled by the Protective Services Commissioner. The applicant had previously purchased a property at Ashfield.

RECORDED   :   NOT TRANSCRIBED

That property is subject to a mortgage however, it is let out to tenants and as a result the applicant obtains income from the rental.  Currently, the applicant, I am informed, is in receipt of a disability support pension because there was a fire in the premises but that is not a matter which is before me.  The period I am concerned with is from the 27th day of August 2001 to the 4th of April 2002.  Because of other unrelated proceedings there was by decision of the New South Wales Supreme Court a caveat over the Ashfield property and also a flat occupied by Mr Vallas to satisfy a judgment of the District Court.

It therefore, was a situation where the applicant had what is termed an unrealisable asset. Subsection 1 of section 1129 of the Social Security Act 1991 as amended reads inter alia:

If (a) either (1) a Social Security pension is not payable to a person because of the application of an assets test or (2) a persons Social Security rate is determined by the application of the assets test and (b) either sections 1108 and 1109 (disposal of income) and 1124A, 1125, 1125A and 1126 (disposal of assets) do not apply to the person or (2) the secretary determines that the application of those sections to the persons should for the purpose of this section be disregarded and (c) the person has an unrealisable asset and (d) the person lodges with the department in a form approved by the secretary a request that the section apply to the person and (e) the secretary is satisfied that the person would suffer severe financial hardship if this section did not apply to the person the secretary must determine that this section applies to the person.

It is clear as I said before that while there was a caveat over the properties, the applicant had an unrealisable asset. The situation then devolved itself into ascertaining whether the applicant was suffering severe financial hardship during the particular period. Now the term "severe financial hardship" has certain qualifications in the Act. However, as was pointed out by Heerey J in Arcibal v Secretary, Department of Family and Community Services (2002) FCA 1313. The expression "extreme financial hardship" is not a technical term. His Honour went on to say that the Oxford English dictionary defines the adjective "extreme" as presenting in the utmost degree some particular characteristic. To my mind extreme and severe present the same issues.

In this matter there were various financial records placed before me and with the assistance of the applicant and Mr White and Mr Kenny, I tried to ascertain just what was the net income received by the applicant from the rents from the Ashfield property during the period under review.  To that end, looking at his bank accounts, and with the assistance of spreadsheets prepared by Mr Kenny, it was ascertained that the applicant was in receipt of approximately $766 per fortnight from the estate agents who managed the property.  It is clear that was a net amount in that the agents deducted their fees before payment to him and it would also appear that the agents deducted certain expenses necessary for the property.

Proceeding on the figure of $766 a fortnight, there was deducted from the total amount the sum of $1448 which was some fencing for the property, there was also mathematics done which stated that an amount of $39 a fortnight should be taken out for insurance of the property.  It would appear that the rates were paid by the agent.  Doing the best I can for the Applicant on the figures it would appear during the period in question he received because of the rents, an amount of $440 per fortnight.  That contrasted with a figure of $427.60 which was the amount which would be paid for a person in receipt of disability support pension.

I might mention also that the applicant does have some other funds with the Protective Service Commission but they have not been taken into account.  Doing the matter as simply as I can, if a person is in receipt of an amount equal to or slightly in excess of the amount of disability support pension from somewhere else, I cannot on the current state of the law be satisfied that he is suffering severe financial hardship.  That means therefore that the decision under review will be affirmed.