Vico and Secretary, Department of Social Services (Social services second review)
[2020] AATA 2177
•10 July 2020
Vico and Secretary, Department of Social Services (Social services second review) [2020] AATA 2177 (10 July 2020)
Division:GENERAL DIVISION
File Number:2018/2026
Re:John Vico
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
DECISION
Tribunal:Deputy President Dr P McDermott RFD
Date:10 July 2020
Place:Brisbane
I affirm the decision under review.
........................................................................
Deputy President Dr P McDermott RFD
CATCHWORDS
SOCIAL SECURITY – Social Security (Administration) Act 1999 (Cth) – disability support pension – suspension and cancellation of payment – notice given by Secretary to applicant pursuant to subsection 63(4) of the Act – questionnaire – involvement in companies – where applicant did not respond to notice – where failure to comply with requirements in notice – decision under review affirmed
LEGISLATION
Acts Interpretation Act 1901 (Cth)
Corporations Act 2001 (Cth)
Social Security (Administration) Act 1999 (Cth)CASES
Estate of Emily Pitt and Secretary, Department of Social Services [2014] AATA 575
Kioa v West (1985) 159 CLR 550; [1985] HCA 81REASONS FOR DECISION
10 July 2020
Deputy President Dr P McDermott RFD
INTRODUCTION
Mr John Vico, (“the applicant”) has made an application for review of the decision of the Social Services and Child Support Division (“SSCSD”) of the Administrative Appeals Tribunal made on 16 March 2018.
That decision affirmed a previous decision of the Secretary, Department of Social Services (“the respondent”), made on 29 November 2017, to suspend the applicant’s disability support pension (“DSP”).
BACKGROUND
The applicant was in receipt of DSP from 3 September 2007. On 29 November 2017, the respondent suspended the payment of DSP to the applicant on the basis that the applicant had not replied to a notice sent to him. On 1 February 2018, the respondent then proceeded to cancel the applicant’s DSP.[1]
[1] Exhibit A, T-Document, T21, p. 619.
Prior to the suspension of the applicant’s DSP and its subsequent cancellation, the respondent issued two notices to the applicant:
(a)On 18 August 2017, the respondent issued a notice to the applicant requiring the applicant to complete questionnaires relating to his assets, his involvement in two private companies and to provide financial documentation in relation to those companies.[2]
(b)On 9 November 2017, the respondent issued a further notice to the applicant requesting an explanation for the cash deposits made into the Mature Age Pty Ltd bank account.[3] The notice also requested the applicant provide financial documents in relation to Mature Age Pty Ltd.
[2] Exhibit A, T-Documents, T4, pp. 34-36.
[3] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 1.
On 8 April 2016, Community Home Project Pty Ltd (“CHP”) was incorporated. The applicant was the director of CHP.[4] The respondent holds no record of the applicant having advised the respondent of his involvement with CHP in or around April 2016.
[4] Exhibit A, T-Documents, T7, pp. 69-70.
On 4 August 2016, Mature Age Pty Ltd (“MA”) was incorporated.[5] The applicant was the sole director and sole shareholder of MA.[6] The respondent holds no record of the applicant having advised the respondent of his involvement with MA in or around August 2016.
[5] Exhibit A, T-Documents, T9, pp. 117, 118.
[6] Exhibit A, T-Documents, T6, pp. 53-55.
On 5 August 2016, the applicant, in his capacity as the sole director of MA, opened a “Business Account” in the name of MA with Bendigo Bank (“the MA business account”).[7] Between 5 August 2016 and 25 August 2016, twelve (12) cash deposits totaling $398,500.00 were paid into the MA business account.[8]
[7] Exhibit A, T-Documents, T9, pp. 104-113.
[8] Exhibit A, T-Documents, T9, p. 95.
On 26 August 2016, MA purchased a residential property for $344,832.82.[9]
[9] Exhibit A, T-Documents, T9, p. 176.
On 16 June 2017, the respondent commenced an investigation into the applicant’s past and present eligibility for DSP.[10] Subsequently, the respondent sent a notice dated 18 August 2017 to the applicant requiring him to provide information to the respondent by 8 September 2017.[11] In response to this notice, on 11 September 2017, the applicant returned a “MOD iA” Income and Assets questionnaire and a “MOD PC” Private Company questionnaire for each of MA and CHP.[12]
[10] Exhibit A, T-Documents, T19, p. 317.
[11] Exhibit A, T-Documents, T4, pp. 34-36.
[12] Exhibit A, T-Documents, T5-T7, pp. 37-83.
In his MOD PC questionnaire dated 5 September 2017, as to MA, the applicant:
(a)stated that the “Type of business” of MA was “Consulting”;[13]
(b)answered “Yes” to the question “Is the company still trading?” and added the word “dormant”;[14]
(c)stated that he was the sole director of MA;[15]
(d)indicated that “director” was not his only role;[16]
(e)stated that the company issued a total of 100 ordinary shares which were entirely held by the applicant for a purchase price of $100 in total;[17]
(f)stated that MA did not have any assets or real estate;[18] and
(g)remarked, in answer to Question 72[19] of the form: “* Company is Dormant non available”.[20]
[13] Exhibit A, T-Documents, T6, p. 53.
[14] Exhibit A, T-Documents, T6, p. 54.
[15] Exhibit A, T-Documents, T7, p. 54.
[16] Exhibit A, T-Documents, T6, p. 54.
[17] Exhibit A, T-Documents, T6, p. 55.
[18] Exhibit A, T-Documents, T6, pp. 56-59, 61.
[19] Question 72 reads: “Which of the following forms, documents and other attachments are you (and/or your partner) providing with this form?” and proceeds to list a number of various document types.
[20] Exhibit A, T-Documents, T6, p. 66.
In his MOD PC questionnaire dated 11 September 2017, as to CHP, the applicant:
(a)stated that the “Type of business” of CHP was “Charity”;[21]
(b)answered “Yes” to the question “Is the company still trading?”;[22]
(c)stated that he was the sole director and a shareholder of CHP;[23]
(d)indicated that “director” was not his only role;[24]
(e)stated that there were twenty two (22) shares in CHP, which shares were held by another person, Ms Lauren Rossi;.[25]
(f)stated that the shareholding for CHP had not changed in the past five (5) years;[26] and
(g)stated that CHP did not have any assets or real estate.[27]
[21] Exhibit A, T-Documents, T7, p. 69.
[22] Exhibit A, T-Documents, T7, p. 70.
[23] Exhibit A, T-Documents, T7, p. 70.
[24] Exhibit A, T-Documents, T7, p. 70.
[25] Exhibit A, T-Documents, T7, p. 71.
[26] Exhibit A, T-Documents, T7, p. 72.
[27] Exhibit A, T-Documents, T7, pp. 72-81.
The respondent also sought information from Bendigo Bank and ASIC in relation to the companies. Subsequently, the respondent sent a further notice to the applicant dated 9 November 2017.[28] The 9 November 2017 notice required that the applicant produce the information requested therein to the respondent by 24 November 2017. The respondent, in its letter, requested various information regarding the cash deposits made in August 2016.
[28] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 1.
On 29 November 2017, the respondent suspended the applicant’s DSP, on the basis that the applicant had not responded to the respondent’s notice dated 9 November 2017.[29]
[29] Exhibit A, T-Documents, T10, p. 178.
On 6 December 2017, the applicant provided material about his involvement as the director of MA.[30] The applicant submitted a Statutory Declaration, alongside a Statutory Declaration by Mr John Greco, which stated that all deposited funds were Mr Greco’s personal funds.[31]
[30] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 2.
[31] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 3.
On 7 December 2017, the applicant sought internal review of this decision. On 1 February 2017, the respondent cancelled the applicant’s DSP.[32] On 12 February 2018, an Authorised Review Officer (“ARO”) for the respondent affirmed the decision to cancel the applicant’s DSP.
[32] Exhibit A, T-Documents, T21, p. 619.
On 16 March 2018, the SSCSD of the Administrative Appeals Tribunal orally affirmed the decision to cancel the applicant’s DSP.
On 11 April 2018, the applicant lodged an application for review of the decision with this Tribunal.
LEGISLATION
Subsection 64(1) of the Social Security (Administration) Act 1999 (Cth) (“the Act”) provides:
64 Effect of failing to comply with requirement to attend Department etc.
Person receiving, or claiming, social security payment
(1)If:
(a)a person is receiving, or has made a claim for, a social security payment; and
(b)the Secretary notifies the person under subsection 63(2), (2AB) or (4); and
(c)the requirement in the notice is reasonable; and
(d)the person does not comply with the requirement; and
(e)except if the person is receiving, or has made a claim for, a participation payment – the Secretary is not satisfied that the person had a reasonable excuse for not complying with the requirement; and
(f)the Secretary is satisfied that it is reasonable for this subsection to apply to the person;
The payment that the person is receiving or has claimed is not payable.
Subsection 63(4) of the Act applies to a person if the person is receiving DSP.[33]
[33] Social Security (Administration) Act 1991 (Cth) subparagraph 63(3)(a)(i).
Paragraph 63(4)(a) of the Act provides that, if the Secretary is of the opinion that a person to whom subsection 63(4) of the Act applies should complete a questionnaire, the Secretary may notify the person that he or she is required, within a specified time, to complete the questionnaire.
Subsections 68(2) and (5) of the Act provide:
68Person receiving social security payment or holding concession card
…
(2)The Secretary may give a person to whom this subsection applies a notice that requires the person to do any of all of the following:
(a)inform the Department if:
(i)a specified event or change of circumstances occurs; or
(ii)the person becomes aware that a specified event or change of circumstances is likely to occur;
(b)give the Department one or more statements about a matter that might affect the payment to the person of the social security payment;
(c)give the Department one or more statements about a matter that might affect the operation, or prospective operation, of Part 3B in relation to the person.
…
(5)An event or change of circumstances is not to be specified in a notice under this section unless the occurrence of the event or change of circumstances might:
(a)affect the payment of the social security payment or the person’s qualification for the concession card, as the case requires; or
(b)affect the operation, or prospective operation, of Part 3B in relation to the person.
Subsection 68(1) of the Act provides that:
Subsection (2) applies to a person to whom a social security payment (other than utilities allowance or energy supplement under Part 2.25B of the 1991 Act) is being paid.
Section 72 of the Act provides:
72Provisions relating to notice
(1)A notice under this Subdivision:
(a)must be given in writing; and
(b)may be given personally or by post or in any other manner approved by the Secretary; and
(c)must specify how the person is to give the information or statement to the Department; and
(d)must specify:
(i)in the case of a notice under section 68 that requires the giving of more than one statement, each relating to the payment of the social security payment in respect of a period—the date by which the person is to give each statement to the Department; or
(ii)in any other case—the period within which the person is to give the information or statement to the Department; and
(e)must specify that the notice is an information notice given under the social security law.
(2)A notice under this Subdivision is not invalid merely because it fails to comply with paragraph (1)(c) or (e).
(2A)A date specified for the purposes of subparagraph (1)(d)(i) must be no earlier than 7 days after:
(i)the day on which the notice under section 68 is given; or
(ii)the day on which the period specified in the notice in relation to that first mentioned date begins;
whichever is the later.
(3)Subject to subsections (4), (6) and (7), the period specified for the purpose of subparagraph (1)(d)(ii) must:
(a)in the case of a notice under section 67, 68 or 69 that requires the giving of information about an event or change of circumstances consisting of the receipt by the person of a compensation payment—be the period of 7 days after the day on which the person becomes aware that he or she has received, or is to receive, a compensation payment; or
(b)in the case of a notice under section 67, 68 or 69 that requires the giving of any other information, or a notice under section 70—be the period of 14 days after:
(i)the day on which the event or change of circumstances occurs; or
(ii)the day on which the person becomes aware that the event or change of circumstances is likely to occur;
as the case may be; or
(c)in the case of a notice under section 67 or 68 that requires the giving of a statement that relates to the payment of the social security payment in respect of a period specified in the notice—end not earlier than 7 days after the day on which the notice is given; or
(d)in the case of a notice under section 67, 68 or 69 that requires the giving of a statement, not being a notice to which paragraph (c) applies—end not earlier than 14 days after the day on which the notice is given; or
(e)in the case of a notice under section 70A that requires the giving of information mentioned in paragraph 70A(2)(a)—be the period of 14 days after:
(i)the day on which the event or change of circumstances occurs; or
(ii)the day on which the person becomes aware that the event or change of circumstances is likely to occur;
as the case may be; or
(f)in the case of a notice under section 70A that requires the giving of a statement mentioned in paragraph 70A(2)(b)—end not earlier than 14 days after the day on which the notice is given.
(4)If the Secretary is satisfied that there are special circumstances related to a person who is to be given a notice under this Subdivision that requires the giving of information about an event or change of circumstances, the period to be specified for the purpose of subparagraph (1)(d)(ii) is such period as the Secretary directs in writing, being a period that ends not less than 15 days, and not more than 28 days, after:
(a)in the case of a notice under section 67, 68 or 70A:
(i)the day on which the event or change of circumstances occurs; or
(ii)the day on which the person becomes aware that the event or change of circumstances is likely to occur; or
(b)in the case of a notice under section 69—the day on which the notice is given.
(6)If a notice under section 67, 68 or 70A specifies an event consisting of the death of a person, the period to be specified under subparagraph (1)(d)(ii) is a period of 28 days after the day on which the event occurs.
(7)To the extent that a notice under section 67, 68 or 70A requires a person to inform the Department of any proposal by the person to leave Australia, subsection (3) does not apply to the notice.
(8)For the purposes of any provision of this Act, other than section 74 or a provision of Part 6, a person is taken to have failed to comply with a notice under this Subdivision if, in response to the notice:
(a)the person gives information or a statement; and
(b)the information or statement is false or misleading; and
(c)the person is reckless as to whether the information or statement is false or misleading.
(9)Nothing in this section prevents the giving of more than one notice under this Subdivision to the same person in relation to:
(a)a claim by the person for the same social security payment or concession card; or
(b)the receipt by the person of the same social security payment; or
(c)the holding by the person of the same concession card.
Section 80 of the Act provides that the Secretary is to cancel or suspend a payment in certain circumstances:
80 Cancellation or suspension determination
(1)If the Secretary is satisfied that a social security payment is being, or has been, paid to a person:
(a)who is not, or was not, qualified for the payment; or
(b)to whom the payment is not, or was not, payable (other than because of the operation of Division 3AA);
the Secretary is to determine that the payment is to be cancelled or suspended.
Note: Division 3AA is about compliance with participation payment obligations for persons who are not declared program participants.
(2)Subsection (1) does not authorise the Secretary to make a determination if:
(a)the payment of a social security payment to a person has been cancelled or suspended by the operation of another provision of the social security law; and
(b)the determination would take effect at or after the time at which the cancellation or suspension referred to in paragraph (a) would take effect.
(3)However, subsection (1) authorises the Secretary to make a determination that:
(a)cancels a social security payment that has been suspended under subsection 81(3); and
(b)takes effect at or after the time the suspension took effect.
(3A)Subsection (1) does not authorise the Secretary to make a determination that cancels the payment of a parenting payment, youth allowance, austudy payment, jobseeker payment or special benefit to a declared program participant if:
(a)paragraph (1)(a) does not apply to the declared program participant; and
(b)paragraph (1)(b) applies only because of the application of a compliance penalty period.
(4)A reference in this section to a social security payment being, or having been, paid includes a reference to:
(a)if the social security payment is a youth allowance—the youth allowance being payable but for the operation of section 547AA; or
(b)if the social security payment is a jobseeker payment—the jobseeker payment being payable but for the operation of section 615.
Section 81 of the Act provides:
81Cancellation or suspension for non‑compliance with certain notices
(1)If:
(a)a person who is receiving a social security payment (other than a jobseeker payment) has been given:
(i)a notice under section 67 or 68 that requires the person to give the Department a statement; or
(ii)a notice embodying a requirement under Division 1 of Part 5; and
(b)the person does not comply with the requirement of the notice;
the Secretary may determine that the social security payment is to be cancelled or suspended.
(2)If:
(a)a person and his or her partner (the partner) are each receiving a social security payment; and
(b)the partner has been given:
(i)a notice under section 67 or 68 that requires the partner to give the Department a statement; or
(ii)a notice embodying a requirement under Division 1 of Part 5; and
(c)the notice relates to matters that might also affect the payment of the person’s social security payment; and
(d)the partner does not comply with the requirement of the notice;
the Secretary may determine that the person’s payment is to be cancelled or suspended.
(3)If:
(a)a person who is receiving a social security payment has been given a notice under section 67 or 68 that requires the person to inform the Department of a proposal by the person to leave Australia; and
(b)the person does not comply with the requirement; and
(c)the person leaves Australia; and
(d)the person’s portability period (see section 1217 of the 1991 Act) for the payment has not ended;
the Secretary may determine that the payment is to be cancelled or suspended.
Note: Subsection (3) lets the Secretary make one determination suspending the payment and later make another determination cancelling the payment. See subsection 33(1) of the Acts Interpretation Act 1901.
Subsection 29(1) of the Acts Interpretation Act 1901 (Cth) provides:
29 Meaning of service by post
(1)Where an Act authorises or requires any document to be served by post, whether the expression “serve” or the expression “give” or “send” or any other expression is used, then the service shall be deemed to be effected by properly addressing, prepaying and posting the document as a letter and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.
NOTICES
The respondent issued two notices to the applicant pursuant to subsection 63(4) of the Act. The first notice was issued on 18 August 2017. The cover page attached to the notice dated 18 August 2017 stated:
This is a notice given pursuant to section 63 of the Social Security (Administration) Act 1999 that requires you to produce information to us by 8 September 2017.
What you are required to do to comply with this notice
Information on what you are required to do to comply with this notice is enclosed. If you need help complying with this notice, more time or would like to discuss it, please call [redacted] on the number at the top of this notice. There is also information enclosed with this notice about your rights and obligations.
If you do not comply with this notice
Failure to comply with this notice by 8 September 2017 without a reasonable excuse may result in:
·your social security payment being not payable
·the recording of a participation failure; or
·you losing qualification for your concession card
You may find it helpful to keep a copy of all information you send to us for your own records as we may contact you again.
The notice dated 18 August 2017 required the applicant to complete a MOD iA form in relation to income and assets as well as two (2) MOD PC forms in relation to the CHP and MA companies. The notice also required the applicant to provide all evidence and all documentation as outlined in the forms.
Question 72 of the MOD PC form requires the following material:
· Latest tax return of the company;
· Profit and loss statement for the company;
· Depreciation schedule of the company; and
· Balance sheet for the company.
The form also requests any other documents which may be applicable.
Question 12 of the MOD iA form requires material relating to the bank account balances of the company.
On 11 September 2017, the applicant returned the MOD iA and the two (2) MOD PC forms alongside bank statements from his personal bank account. The applicant did not provide copies of any material outlined in Question 72 of the MOD PC form nor copies of any material outlined in Question 12 of the MOD iA form.
The respondent issued a further notice to the applicant on 9 November 2017 pursuant to subsection 63(4) of the Act, after obtaining the following information:
· On 5 August 2016, the applicant opened an account with Bendigo Bank in the name of MA;
· The three signatories to this account were the applicant, Mr Guiseppe Rossi and Mr Greco;
· Between 5 August 2016 and 25 August 2016 twelve (12) cash deposits totalling $398,500.00 were paid into the MA business account;
· On 26 August 2016, MA purchased a property on Drouin Rd, Longwarry for $344,382.82;
· Between 2 December 2016 and 18 August 2017, regular withdrawals of $500.00 per week were labelled as “fees” paid to the applicant’s partner’s CBA account; and
· On 27 October 2016, caveats over the property on Drouin Rd, Longwarry were lodged by “Thuan Bui” and “Yanelly Sanchez”.
The cover sheet of the notice dated 9 November 2017 required the applicant to produce the requested information by 24 November 2017. The notice dated 9 November 2017 contained details on how to comply with the notice and the consequences if the notice was not complied with; these were the same details as were contained in the notice dated 18 August 2017. However, the notice dated 9 November 2017 requested the applicant to produce information regarding the financial details of MA, specifically in relation to the purchased property, the caveats over that property and deposits made into the MA business account. The notice dated 9 November 2017 also noted that the respondent had contacted the applicant’s accountant about the financial and assets details for MA, and the applicant’s accountant had advised the respondent that the applicant had not provided him with any financial details for MA or any details of the company’s assets.
By 24 November 2017 the applicant had not submitted any documents to the respondent relating to the notice dated 9 November 2017.
On 6 December 2017 the applicant provided to the respondent a Statutory Declaration by the applicant dated 6 December 2017, along with a Statutory Declaration by Mr Greco dated 5 December 2017.
The Statutory Declaration by the applicant dated 6 December 2017 addressed the deposits made into the MA business account. The applicant stated that these deposits were made by Mr Greco, and these deposits consisted of Mr Greco’s monies. The applicant stated that the funds used to purchase the property belonged to Mr Greco, and that the applicant did not have any controlling or financial interest. The applicant also stated that the caveats over the property were because of a financial interest. The applicant stated that Mr Greco was assisting him in “creating a financial record”, where Mr Greco would deposit money into the CBA account and funds were “just circulating to show continuity”. The applicant stated that he wanted the opportunity to learn how a company runs and, in particular, a trust, and that his position as a director was purely for training and experience. The applicant also stated that the term “fees” on the bank statements held by the MA business account were an error or oversight when Mr Greco was setting up the payments.
In the Statutory Declaration by Mr Greco dated 5 December 2017, he stated that the funds deposited into the MA business account were his own personal funds. Mr Greco stated that the applicant was under basic training on how a company operates. Mr Greco stated that this was voluntary and was for the applicant to receive firsthand knowledge of trusts.
APPLICANT’S SUBMISSIONS
On 7 December 2017, the applicant submitted an application for review of a decision with supporting documentation after the respondent suspended the applicant’s DSP payments on 29 November 2017. The applicant submitted as supporting documentation a letter from Mr Greco, a statement by the applicant, and documentation regarding the transfer of the property.
The applicant provided further submissions to the Tribunal.[34]
[34] Exhibit C, Applicant’s reply to the Respondent’s statement of facts and contentions.
Reasonable Requirements
The applicant submits that it was not reasonable to expect the applicant to respond to the notice dated 9 November 2017 when he was not aware that the notice had been sent. The applicant submits that he presented himself to the Department immediately after he discovered that he was no longer receiving payments. The applicant submits that, after the respondent became aware that the applicant had not received the notice dated 9 November 2017, the respondent should have afforded the applicant more time to respond to the notice.
The applicant submits that he was not afforded procedural fairness as the respondent did not give the applicant an appropriate time to respond to the notice dated 9 November 2017 after the respondent found out the applicant had not received the notice. The applicant submits that procedural fairness recognises the power imbalance between a respondent and an applicant. The applicant refers to the decision of Kioa v West in support of his submission.[35]
[35] (1985) 159 CLR 550; [1985] HCA 81.
The applicant submits:
It has never been the intention of Parliament to destroy a right nor for any public authority to ignore the law.
The applicant submits that it was not reasonable for the respondent to request certain documents in the notice dated 9 November 2017, as these documents were impossible to obtain. Specifically, the applicant noted that his accountant was overseas, as a result the applicant was not able to obtain documents which had been requested.
The applicant submits that his accountant is the best person to contact regarding the financial position of the company. It is the applicant’s understanding that he communicated this to the respondent through the questionnaire and by multiple phone calls to the respondent.
The applicant submits:
The applicant was expected to provide complex and extensive information that only a professional or expert can provide. The applicant needed assistance and advice to obtain and produce all the information required. Having less than 14 days to obtain all this information is grossly unjust, unreasonable and not done in good faith.
Reasonable Excuse
Receipt of Notice dated 9 November 2017
The applicant contends that he never received the respondent’s notice dated 9 November 2017. The applicant states that when he went to the Moreland Centrelink office on 29 November or 30 November 2017 to enquire about his suspended DSP payments, he was advised that a letter had been issued requesting information.
The applicant stated that he moved in or around October 2017, but that he had advised the Department of his new address.
In the applicant’s statement dated 7 December 2017 he stated:
An apparent letter was sent to provide further information by the 24 November 2017. This letter was never received. I only became aware of the letter once our payments were stopped and I went straight to my local Centrelink office to see why the payments had stopped. I received a copy of the letter and made every effort to obtain that information as soon as practicably possible. However, why was the letter not sent to my gov inbox electronically? Why is it that I went to Centrelink to find out there was letter sent and payments not restored when it was known to Centrelink that I had not received this letter that was apparently sent?
I future I require correspondence to be sent to me electronically because I am not in a position for my family and I to have the only form of subsistence being suspended from us for something that is out of our control.
The applicant submits that there has been no proof that the notice dated 9 November 2017 was posted to the applicant’s residential address, or the applicant’s email address, or the applicant’s my.gov inbox.
The applicant submits:
The applicant did not receive any correspondence dated 9 November 2017. Further, even if the notice was supposedly sent on the 9 November 2017 (the same day it was written), this day was a Thursday. It would be impossible for the correspondence to be received by the next day Friday (unless it was sent express post). The following two (2) days are the weekend and no mail usually is delivered on the weekend. So even if the correspondence was sent, and had the applicant received the notice in question, it definitely does not give the applicant 14 days to obtain the information by making an appointment to see the accountant, for the accountant to draw up any documents required, seek legal or financial advice, gather up extensive amounts of information to provide within the time limits required by the allege notice sent.
Explanation of Assets and Finance
The applicant submitted that from his understanding and by the advice of his accountant, MA is the trustee, which had the role of holding assets in trust for the Mature Age Unit Trust. The applicant submitted that the property on Drouin Rd, Longwarry was purchased by MA, and held in trust for Mature Age Unit Trust.
The applicant submits that the caveats were lodged over the property to secure a financial interest. In giving evidence, the applicant stated that the caveats were lodged by Mr Rossi, Mr Greco and their partners.
The applicant explained that the $500.00 funds deposited from the MA business account and paid into the applicant’s partner’s CBA account was to create a financial record, in order for the applicant and his partner to rent a property. The applicant submits that a Rental Manager had advised him that it would be difficult to rent being on Centrelink.
The applicant submits that there are no other bank records other than that contained in the MA business account records.
Reasonable to Suspend Payment of DSP
Mr Greco states in his letter dated 7 December 2017 that the applicant is now in a position that he is unable to pay his rent, and he is unable to support his family.
The applicant in his statement dated 7 December 2017 submitted that requesting him to provide documents that belong to a third party that are none of his concern there is a breach of privacy. The applicant also claims that the decision to suspend his DSP is a breach of human rights. The applicant also stated that the decision is crippling his family financially and is exacerbating the applicant’s medical conditions.
The applicant submits that the respondent has not undertaken an investigation pursuant to the law; had failed to disclose relevant information including a phone conversation with Mr Greco, and information that Mr Greco had provided; and that the respondent had not taken into consideration that the applicant stated had that the company had no assets and no expenses.
The applicant submits that it was unreasonable to suspend his DSP because even when the respondent became aware that the applicant had not received the notice dated 9 November 2017, the respondent was not willing to provide the applicant with more time to submit the documentation.
RESPONDENT’S SUBMISSIONS
The respondent submits that the applicant failed to disclose the financial statements and any other information about the nature of the caveats lodged over the property of the MA requested by the respondent in its notice to the applicant dated 9 November 2017, therefore giving rise to a cancellation and/or suspension of payment, where the payment was no longer payable pursuant to section 80 of the Act.
The respondent further submits that the applicant’s explanation for the cash deposits is not credible, as the statement of Mr Greco dated 6 December 2017 had no corroborating evidence to support the claim that the deposited funds into the MA business account were Mr Greco’s personal funds. The respondent also submitted that there was little explanation for why Mr Greco would deposit funds of $398,500.00 in the MA business account and what security, if any, Mr Greco was receiving from making these deposits.
The applicant has stated that he was involved with MA on a voluntary basis as he was seeking firsthand knowledge, particularly in trusts. The respondent submits that there is no evidence of any trust, or details on how a trust relates to MA.
The respondent also submits that, as the sole Director and a shareholder of MA, the applicant has control over the company and its financial records.
The respondent also noted that the applicant has not provided an explanation for why he failed to disclose his involvement with the company, MA, when it was incorporated in August 2016, and further to this, why the applicant failed to disclose that MA had purchased the property on Drouin Rd, Longwarry in the MOD PC questionnaire completed by the applicant in September 2017.
The respondent submits that the requirements of the notice issued to the applicant on 9 November 2017 were reasonable and the applicant has not provided a reasonable excuse for not complying with it. In saying this, the respondent submits that as there was no reasonable excuse to comply with the notice issued under section 63 of the Act, and payment is to be either suspended or cancelled. Reference was made to the decision in Estate of Emily Pitt and Secretary, Department of Social Services.[36]
[36] [2014] AATA 575.
Reasonable Requirements
In response to the applicant’s submission that he did not receive the notice dated 9 November 2017 the respondent submits that the applicant had not not complied with the respondent’s earlier notice dated 18 August 2017 either. The respondent submits that, given the applicant did not comply with the requirements under the notice dated 18 August 2017, the respondent issued the subsequent notice dated 9 November 2017.
The respondent also submits that, as the sole director of MA, the applicant has an obligation under the Corporations Act 2001 (Cth) to be aware of the financial situation of the company. Therefore, it was reasonable to expect that the applicant would be in a position to obtain the documents in compliance with the respondent’s notice dated 9 November 2017.
Reasonable Excuse
The respondent submits that as the applicant has not provided any evidence that he did not receive the respondent’s notice dated 9 November 2017, then pursuant to subsection 29(1) of the Acts Interpretation Act 1901 (Cth), the applicant is deemed to have received the notice.
Reasonable to Suspend Payment of DSP
The respondent submits that, as the applicant failed to comply with both the respondent’s notice dated 18 August 2017, and the respondent’s notice dated 9 November 2017, it was reasonable for the respondent to apply subsection 64(1) of the Act and suspend the payments under section 80 of the Act, and subsequently cancel the payments.
CONSIDERATION
I consider that the respondent was justified in suspending and then cancelling the payment of DSP to the applicant. In my view the respondent was justified in taking this action under sections 64 and 80 of the Act.
On 8 April 2016 and 4 August 2016 respectively, the applicant became a director of CHP and MA. In August 2016, cash deposits which totalled $398,500 were paid into the MA business account. It was reasonable for the respondent to issue those notices on 17 August 2017 and 9 November 2017 to the applicant because the information sought was relevant to the applicant’s eligibility to receive DSP.
The applicant had failed to fully answer the 18 August 2017 notice and, by not answering that notice, the suspension of the applicant’s DSP could have occurred because of the incomplete information he provided. In my view the respondent was extending an indulgence to the applicant by issuing the later notice on 9 November 2017 which gave the applicant a further 14 days to provide the information.
The applicant failed to comply with the 9 November 2017 notice by not providing documentation about the finance or assets of MA, as well as the August 2016 cash deposits within the 14 day period prescribed by the respondent’s notice. The applicant was the sole director of MA and any relevant documents concerning the finance or assets of MA would have been within his possession or, at the very least, within his power to obtain within that time frame. While the applicant contends his accountant was overseas at this time, it is implausible that the accountant would not have made arrangements for his clients in his absence and, in the event that this was not possible, there has been no evidence placed before the tribunal from the accountant to support the contention that it was impossible for the applicant to obtain these documents during that period from the accountant. Therefore, I do not consider that the applicant had any reasonable excuse for not providing to the respondent the requested documentation about the finance or assets of MA.
On 29 November 2017, a decision was made by the respondent to suspend the applicant’s DSP. DSP was not payable to the applicant by operation of subsection 64(1) of the Act and the respondent’s decision to suspend the payment of the benefit was made under subsection 80(1) of the Act.
The applicant contended that he did not receive the 9 November 2017 notice prior to the respondent cancelling payment of his DSP. The respondent submitted that, pursuant to subsection 29(1) of the Acts Interpretation Act 1901 (Cth), the applicant should be deemed to have received the notice in the ordinary course of post unless it is established that the letter was not properly addressed, paid for, or posted. The respondent’s 9 November 2017 notice was addressed to the same address listed in the applicant’s application for internal review by an ARO which is dated 7 December 2017 as his permanent address.[37] I am therefore satisfied that the letter was correctly addressed. There is no evidence placed before me that the letter was not properly paid for or posted and therefore, I am satisfied that the applicant was served with the 9 November 2017 notice.
[37] Exhibit A, T-Documents, T12, p. 181.
On 6 December 2017, after the suspension of his DSP, the applicant belatedly complied with the respondent’s later notice of 9 November 2017.[38] This was done by a statutory declaration of Mr John Greco in which Mr Greco claimed that all deposited funds in the bank account were his own funds.[39] I do not accept that the explanation of Mr Greco is plausible. There is no logical reason provided to the Tribunal to explain why Mr Greco would enable the applicant to have access to his personal funds. There is no cogent or corroborating evidence placed before the Tribunal to enable me to find that all the deposited funds in the bank account were in fact the funds of Mr Greco. There was no explanation of the source of the funds. The applicant did not call Mr Greco to give evidence before the Tribunal at the hearing to explain how and why the funds were his personal funds. Therefore, I can place no weight on the explanation provided by Mr Greco as to the provenance of the funds deposited into the MA business account.
[38] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 2.
[39] Exhibit B, Secretary’s Statement of Facts and Contentions dated 6 July 2018, Annexure 3.
The applicant stated that his role as a sole director of MA was a voluntary position which was to enable him to gain experience about trusts. This explanation is not plausible as no corroborating evidence of trusts was placed before the Tribunal. There was also an assertion that MA purchased and held the Drouin Rd, Longwarry on trust for the “Mature Age Unit Trust”.[40] However, there is no cogent evidence placed before the Tribunal to substantiate this assertion. The Tribunal has not been provided with any documentary evidence corroborating the existence of such a trust such as a deed establishing the identities of the trustees and beneficiaries, the governing rules, or the identification any trust assets or liabilities. No evidence has been provided as to the registration of such a trust, for example an Australian Business Number (ABN) or accounting records of tax withheld or reported.
[40] Exhibit C, Applicant’s reply to the Respondent’s statement of facts and contentions, paragraph 9.
I have concluded that the applicant did not comply with either of the notices issued under subsection 63(4) of the Act and, therefore, by operation of subsection 64(1) of the Act, the applicant’s DSP was no longer payable to him. I am satisfied that it is reasonable for subsection 64(1) of the Act to apply to the applicant. Despite the passing of approximately eleven (11) months from when the respondent suspended the applicant’s DSP to when the hearing was held before this Tribunal, I consider that the applicant has still failed to comply with the requirements in the respondent’s notice dated 9 November 2017 in that he still has not provided to the respondent the information it requested, particularly with reference to the monies deposited in the MA business account. It was accordingly appropriate under subsection 80(1) of the Act to suspend the payment to the applicant.
The applicant was required, under section 68 of the Act, to advise the respondent of certain changes in his circumstances. The applicant was given information notices pursuant to subsection 68(2) of the Act on various occasions during his time in receipt of DSP that he was required, to inform the respondent if specified events or changes in circumstances occurred.[41] As early as 19 September 2007, the applicant was notified that he was required to inform the respondent of specified events or changes in his circumstances, including relevantly, if:[42]
·you or your partner start any form of profession, trade, business or self-employment;
·you or your partner buy or sell any shares or managed investments;
·your combined assets other than financial investments are more than $357,750.00;
·you or your partner start any new accounts;
·you or your partner give away assets as gifts or sell them for less than their value;
·your or your partner’s assets change substantially;
·you are involved in, or receive a benefit from, a private trust or private company; and
·the nature of your involvement in, or the benefit you derive from, a private trust or private company changes.
[41] Exhibit A, T-Documents, T21 “Centrelink letters issued to the Applicant for the period 19.09.2007 – 11.01.2018”.
[42] Exhibit A, T-Documents, T21, pp. 347-348.
Upon being appointed as a director of the CHP and MA companies, the applicant was required, by virtue of the notices given by the respondent to the applicant pursuant to subsection 68(1) of the Act, to inform the respondent of these appointments. The applicant was informed of his notification requirements by the respondent’s notice sent to him on 19 September 2007. Such a notice requiring the applicant to inform the respondent of changes in his circumstances were given to the applicant on various dates during his receipt of DSP including, for example, on 30 December 2013.[43] The notices required the applicant to advise the respondent of relevant changes in his circumstances, including specifically, a change in the nature of his involvement in a private trust or company. His failure to comply with the notice under section 68 of the Act empowered the respondent to suspend the applicant’s DSP under subsection 81(1) of the Act.
[43] Exhibit A, T-Documents, T21, p. 515.
CONCLUSION
For the reasons above, the correct and preferable decision is to affirm the decision of the respondent dated 29 November 2017 to suspend the applicant’s DSP pursuant to subsection 80(1) of the Act. On that date, the applicant’s DSP was not payable by reason that:
(a)The applicant was in receipt of DSP;[44]
(b)The respondent notified the applicant pursuant to subsection 63(4) of the Act on 9 November 2017;[45]
(c)The requirement in the respondent’s notice was reasonable;[46]
(d)The applicant did not comply with the requirement in the notice;[47]
(e)The applicant did not have a reasonable excuse for not complying with the requirement;[48]
(f)It is reasonable for subsection 64(1) of the Act to apply to the applicant.[49]
[44] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(a).
[45] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(b).
[46] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(c).
[47] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(d).
[48] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(e).
[49] Social Security (Administration) Act 1999 (Cth) paragraph 64(1)(f).
I also consider that the applicant failed to inform the respondent of specified events or changes in his circumstances in accordance with various notices given to him by the respondent pursuant to subsection 68(2) of the Act. I am therefore satisfied on the basis of the material before me that, as at 29 November 2017, the respondent was also empowered under subsection 81(1) of the Act to suspend or cancel the applicant’s DSP.
DECISION
I affirm the decision under review.
I certify that the preceding 82 (eighty-two) paragraphs are a true copy of the reasons for the decision herein of Deputy President Dr P McDermott RFD
..................................................................
Associate
Dated: 10 July 2020
Date of hearing: 21 November 2018 Date final submissions received: 6 February 2019 The Applicant: In person Solicitor for the Respondent: Mr Chris Bishop,
Mills Oakley Lawyers
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