Walsh and Department of Education, Training and Youth Affairs

[2000] AATA 412

DECISION AND REASONS FOR DECISION [2000] AATA 412

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No V1999/1282

GENERAL ADMINISTRATIVE  DIVISION       )          
           Re      DEBRA WALSH    
  Applicant
           And    THE SECRETARY TO THE DEPARTMENT OF EDUCATION, TRAINING AND YOUTH AFFAIRS  
  Respondent

DECISION

Tribunal       Mr B.G. Gibbs, AM, Senior Member       

Date29 May 2000

PlaceMelbourne

Decision      The Tribunal affirms the decision under review.
  (Sgd.)    B.G. GIBBS
  Senior Member
CATCHWORDS
AUSTUDY – eligibility – overpayment – unapproved absences – debt – recovery
Words and Phrases
Study Assistance Act (1973) ss. 287, 289, 290C
AUSTUDY Regulations 8, 12E, 29
Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 152 ALR 127
Director-General of Social Services v Hales (1982) 47 ALR 281
Re Beadle and Director-General of Social Services (1984) 6 ALD 1
Beadle v Director-General of Social Services (1985) 60 ALR 225

REASONS FOR DECISION

29 May 2000 Mr B.G. Gibbs, AM, Senior Member                   
 Introduction            

1. This is an application by Mrs Debra Walsh for review of a decision of the Social Security Appeals Tribunal ("SSAT") made on 28 September 1999.

2. The decision of the SSAT was to affirm the decision of the Secretary, Department of Employment, Education, Training and Youth Affairs (now known as Department of Education, Training and Youth Affairs) ("the Department") made on 10 September 1996 (as varied by a delegate of the Secretary upon review on 22 August 1997), to raise and recover a debt of $1,806.51 in AUSTUDY payments made in 1996, in respect of Mrs Walsh's son James.
   Representation

3. At the hearing before this Tribunal Mrs Walsh was self-represented.  Mr Kouris, of Counsel, appeared for the respondent.
   Material

4. The Tribunal had before it documents ("the T documents") lodged by the respondent pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, together with other material received during the hearing.
   Witnesses

5. During the hearing evidence was given by Mrs Walsh and her husband Michael Walsh.
   Background

6. James enrolled at Benalla College ("the School") in 1996.

7. He was eligible for AUSTUDY payments which were received on his behalf by his mother.

8. The school advised the Department that James had unapproved absences from school on six full days and eight half days towards the end of term 2 1996.  This makes a total of ten days unapproved absences from the College.

9. It is the Department's contention that James' last day at the school was 28 June 1996.

10. On 1 August 1996 Mrs Walsh received in error a lump sum payment of $1,555.45 for the next semester of her son's attendance at the school.

11. The school asserts that James signed out on 29 June 1996.  Mr Walsh, on the other hand, states that his son signed out on 8 August 1996.  In a statutory declaration which he signed on 22 December 1998, James states that he signed out on 18 August 1996.

12. In his reasons for decision, which are dated 22 August 1997, the review officer explained how the overpayment sum of $1,806.51 was calculated:

    "The payments received in 1996
    The overpayment amount originally claimed has been reduced from $3102.04 to $1806.51.
    Computer Problem
    There was a departmental computer problem.  In August 1996 the Department's computer system caused two faults.  It treated you as being ineligible for assistance for the whole year although you were eligible for part of the year.  Further, the computer system generated a payment to your mother of $1555.43, a payment which your father was acknowledged was a payment which you realised at the time that you were not entitled to.
    This problem has only recently been fixed and as soon as it was fixed, your overpayment reduced from $3102.04 to $1997.32.
    Reduction of Overpayment – Extension of Eligible Period
    I also altered the date from which you were eligible from 21 February 1996 to 2 February 1996.  Your Youth Training Allowance ceased on 1 February 1996 and you were eligible after this date.  Your overpayment was further reduced from $1997.32 to $1806.51.
    Unapproved Absences and Last Day of Attendance
    Benalla College has advised us that your last day of attendance at Benalla was 28 June 1996, and that you had 6 full days and 8 half days of unapproved absences from school.  This adds to a total of 10 days unapproved absences, all in term 2 of 1996.
    Regulation 29 imposes a penalty to students who have more than 5 days unapproved absences in a term.  You are not eligible for AUSTUDY for five of the unapproved absences (that is, absences beyond five days in a term) and there is a further fourteen day penalty period.  There is a total of nineteen days in respect of which you are not eligible for AUSTUDY.
    The school is certain that your last day of attendance was the 28 June, 1996.  Under Regulation 8 you are not eligible for AUSTUDY entitlement after this date.  The payments to your mother continued and these payments are considered an overpayment.
    Overpayment Calculations
    Your 1996 entitlement is (See attachment C)                  $1295.53
    Gross payments in 1996  $3102.04
    Overpayment  $1806.51"

Mr Kouris informed the Tribunal that because of a reduction in respect of the overpayment, the current debt is $1,006.61.
The Law

1. Regulation 8 of the AUSTUDY Regulations provides that a student is only eligible for assistance up to the last day of attendance in a course if the student ceases the course before the official last day of the course.

2. Regulation 29 provides that a student attending a secondary school must study full time.  The Regulation further sets out the penalties for unapproved absences from school.  It imposes a penalty to students who have more than five days unapproved absences, that is absences beyond five days in a term.  Additionally, there is a further fourteen day penalty period.

3. Regulation 12E provides that if AUSTUDY has been overpaid, the difference between the total amount paid and the amount that would have been properly payable, is the student's assistance overpayment.

4. Section 287 of the Student Assistance Act 1973 ("the Act") provides for write off of the debt. However, write off is only appropriate in circumstances where a debtor's financial circumstances are such that the debt is effectively irrecoverable, that is to say where it is not possible or practical to recover at the present time and it is unlikely that the monies will be recoverable from the debtor in the foreseeable future.  Write off does not extinguish the debt, it only defers recovery.

5. Pursuant to section 289 of the Act the debt may be waived where it was attributable solely to an administrative error by the Commonwealth, and the debtor received the payment which gave rise to the debt, in good faith.

6. Section 290C of the Act provides for waiver of the debt where:

   (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; 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.

Contentions

1. The Department set out a number of contentions in a Statement of Facts and Contentions lodged with the Tribunal, as follows:

   "1.Regulation 8 of the Austudy regulations provides that a student is only eligible to (sic) assistance up to their last day of attendance in a course if they cease the course before the official last day of the course.

   2.Regulation 29 sets out the penalties for unapproved absences from school.

   3.Pursuant to regulation 29, the respondent contends that James Walsh is not eligible for Austudy for five of the unapproved absences and that there is a further fourteen day penalty period.  Therefore, totalling 19 days in respect of which James Walsh was not eligible for Austudy.

   4.Pursuant to regulation 8, James Walsh is not eligible for Austudy after 28 June 1996 which is the date upon which Benalla College advises was his last day of attendance.

   5.The conditions in which waiver of a debt arise are not met in this case.  It has been acknowledged by Mr Walsh that the lump sum payment of $1,555.43 made to the applicant was no doubt an error.

   6.The decision of the SSAT should therefore be affirmed."

Evidence

1. James' father, Mr Michael Walsh, stated in evidence that the Vice Principal of the school telephoned him in term 3, 1996, that is to say in July, to inquire as to the whereabouts of James.  Mr Walsh told the Vice Principal that he did not know, although he did explain that James was involved in some job research activities, which included an application to join the Army.  Another activity was with a local employer in Benalla.

2. After the telephone call Mr Walsh spoke with James and a couple of days later the Vice Principal telephoned again.  Having spoken with James, Mr Walsh was able to again inform the Vice Principal that James was pursuing employment and that he had approached a number of organisations.

3. Mr Walsh explained that in the event that James was not successful in gaining employment he would return to school immediately but that, should he be successful, then he would sign out of school and then take up the job offer.  This, he said, was during term three.

4. Mr Walsh made the point that if James had signed out of school on 29 June 1996, as stated by the school, there would have been no reason for the Vice Principal telephoning in July and again in August, about James' absence.

5. Mr Walsh stated that he insisted to the Vice Principal on a couple of occasions, that James had signed out but that the Vice Principal had said this was not so, citing the reliability of the office staff and that no form had been received.  It was Mr Walsh's assertion, however, that he had personally instructed James to sign out and attend to any other necessary paperwork.

6. As to the statutory declaration made by James on 22 December 1998, to which reference has been made in paragraph 11 above, Mr Walsh said that for some reason James thought that although he was not certain, nevertheless 18 August 1996 seemed to be the date he signed out.

7. As indicated, Mr Walsh said his son signed out on 8 August 1996, although he could not work out why that would have been so.

8. Mr Walsh said that James completed an AUSTUDY form (T6/41) on 5 August 1996, in which he stated that he had discontinued full time studies on that date.  In the form James further made a declaration dated 5 August 1996, that the information as to the discontinuance of full time studies was correct.  It is noted that in making his declaration James acknowledged his obligation to notify the Department in writing, of any changes to the information provided on the form, within 14 days of the change occurring.

9. It is noted that the form in question is date-stamped as having been received by the departmental AUSTUDY authority on 6 August 1996.

10. Mr Walsh said that James is adamant that on 5 August 1996 he went to the school where he signed out, leaving the form on the front counter as instructed by a staff member, and that he then proceeded to Centrelink and signed the change of circumstance form on the same day.

11. Mr Walsh acknowledged, however, that he was unable to produce the form stating that James had signed out, but said his son had never returned to school after 5 August 1996.

12. Mr Walsh stated that whereas it had been asserted that James had accepted that he was absent for ten unapproved days, this was quite wrong and that James accepted that he may have missed up to eight or ten days in term two, but that several of the days were not unapproved days.  Rather, they were days when he was sick.  Mr Walsh said that while telephone calls were made concerning the sick days and that James handed sick notes into the school, he could not produce the notes in question.

13. During his evidence Mr Walsh referred to document T18/73-75, which comprises notes that are understood to have been written by a senior Centrelink officer.

14. While he stated that the notes do not serve to prove that James attended school in term 3, Mr Walsh said they do, however, demonstrate that James was still officially enrolled at the school in July 1996.  Nevertheless, it was Mr Walsh's assertion that on a number of occasions the Vice Principal had said to him that he had seen James around the school playgrounds a few times during the third term.  Mr Walsh further stated that James himself was adamant that he did attend some classes during this time.  The file note compiled by the senior Centrelink officer and dated 19 September 1997, relevantly states as follows:

    "James Michael WALSH
    Review letter 22 August 1997 is deficient in several respects.

    1.Date of start of entitlement is correct but the student went back to his studies in term 3, so the date 28 June 1996 cannot be the last day of attendance.  The blue form (dated 26. 7.96) goes on to say that the student is "still officially enrolled" and the meaning of that is not clear.

    Father agrees that the date 5 August 1996 is correct and will speak now with the assistant principal of the school about it.

    2.The absences overlap the "last day of attendance".  If the last day of attendance was 26 June 1996 then there cannot be absences for 26, 27 and 28 June 1996.  Can't be right.  Father will check with the school about the absences.  He will persuade the school that the absences were not in fact "not approved by the school"."

15. Mrs Walsh said that she telephoned Centrelink some three to four weeks after she discovered money had been paid into her account, to find out whether it was something to do with AUSTUDY.  She said she was informed that there had been no overpayment.

16. Mrs Walsh stated that she then telephoned Workcover but was informed they had not paid the money.

17. Mrs Walsh then contacted her bank a week or two after she had telephoned Centrelink.  The bank informed her that the payments had been made by Centrelink.  She agreed that it was thus about six weeks after receiving the money that she knew it was a mistake.

18. Mrs Walsh said that she did not offer to return the money at that time, meaning August 1996.  Mrs Walsh agreed that, given James had made a statutory declaration that he had signed out of school on 18 August 1996, he could not have still been at school after that date.

19. Mr Walsh agreed that an "Enrolment Check Anomaly – 1996 – Secondary Students" record (T4/38), states that James' last day of attendance at school was 26 June 1996, and that this was the date originally used by the Department to calculate his last attendance day.  Mr Walsh further agreed that because the attendance and absence record section of the form recorded a half-day absence on 29 June 1996, that ultimately that date was used as the last day of attendance.  This he said was so even though the form had recorded the last day of attendance as being 26 June 1996, being a date which he said was not correct and served to demonstrate the unreliability of the school administration.  Mr Walsh also acknowledged that the form (T4/38) records James as "still officially enrolled" on 29 July 1996.

20. When asked whether he possessed any documentation to substantiate his claim that James was at school in the second term, Mr Walsh responded by stating:

    "I don't know things operate if you have children going to school.  I give them notes when they are absent and there is no reason given for having three notes, even a phone call is supposed to suffice.  We have done it.  We can't prove that he handed those notes in.  We can't prove that he handed them in.  We can't prove physically, personally, because I wasn't at the school fence, but that does not mean the Vice Principal saw him every second of every day either and on top of that, I gave the story about Peter.  What more do I need to say about that?"

Mr Walsh stated that he had not been in the habit of keeping copies of sickness notes; they were notes for the school to keep and there was no reason for him to retain copies.  Nor could he recall how many notes he would have sent in respect of James.  He said that it was school policy to require notes concerning absences.  He had never posted the notes but on occasions had handed them into the school.  Usually he would have given them to James to hand in.  This was the usual practice.  Mr Walsh stated that he had never telephoned the school to verify that James had handed in the notes.  He had no reason to believe his son would not have done so.

1. Mr Walsh agreed it was possible that there were occasions when he assumed James had been at school when in fact he had not.

2. Mr Walsh denied that the Vice Principal had telephoned him in June 1996, but rather that he had done so on two occasions during July.

3. Mr Walsh agreed that there might have been a number of the 10 absences in respect of James that he did not write notes for.  He was sure, however, that he provided at least three notes, probably more.
   Findings

4. From the material before me I find, on the balance of probabilities, as follows:

   (a)That Mrs Walsh was in receipt of AUSTUDY payments in respect of her son James, for which he became eligible on and from 2 February 1996;

   (b)That Mrs Walsh also received a lump sum payment of $1,555.45 from AUSTUDY, due to a computer error;

   (c)That James attended Benalla College full time in term 1, 1996;

   (d)That in term 2, James had unauthorised absences on six full days and eight half days;

   (e)That James did not attend school in term 3 of 1996, and that he signed out on 29 June 1996;

   (f)That pursuant to Regulation 29, James is not eligible for AUSTUDY for five of the unapproved absences, and that there is a further 14 day penalty period;

   (g)That there was therefore a total of 19 days in respect of which James was not eligible for AUSTUDY;

   (h)That pursuant to Regulation 8, James is not eligible for AUSTUDY after 28 June 1996, being the date of his last day of attendance at school;

   (i)That pursuant to Regulation 12E, James incurred a student's assistance overpayment in the sum of $1,806.51, being a debt owing to the Commonwealth;

   (j)That the requirements of sections 287, 289 and 290C of the Act relating to write off and waiver of a debt to the Commonwealth are not satisfied in this case.

5. There is no dispute concerning findings (a), (b) and (c).

6. It will be apparent that in respect of findings (d) and (e) I have, on the balance of probabilities, preferred the relevant school records.  In preferring those records I have been mindful of submissions made by Mr Walsh in which he asserted that the school records are contradictory and therefore, on the balance of probabilities, his evidence and that of his wife (and by implication that of James), should be preferred.

7. Findings (f), (g) and (h) are in effect consequential upon application of Regulations 8 and 29.

8. In respect of finding (i), I have had regard for the written advice provided to James by the Bendigo Student Assistance Centre (Mr Thomas Moloney) on 22 August 1997 (T17/64).

9. While arguably not particularly germane to these proceedings, it is nevertheless helpful to record that although Mrs Walsh is presently making repayments of $25 per fortnight, both she and her husband are emphatic that this is the limit of their capacity to pay.

10. As indicated, finding (j) concerns the operation of sections 287, 289 and 290C of the Act, the requirements of which in terms of write off or waiver have been set out in paragraphs 16, 17 and 18 above.

11. As I have recorded, Mrs Walsh is currently making repayments at the rate of $25 per fortnight.  The repayments are being made from Mrs Walsh's ongoing disability support pension.  That being so, and while I am mindful of the purpose of the disability support pension, it cannot in my view be said that the debt is irrecoverable.

1. Centrelink has acknowledged that the payment of $1,555.45 to Mrs Walsh on 1 August 1996 was made solely due to a computer error and therefore solely due to administrative error on the part of the Commonwealth.  I am satisfied, on the balance of probabilities, that Mrs Walsh did not receive the payment in good faith.  That is to say I am satisfied that although she was aware of the payment and must have realized it was a mistake, she did not contact Centrelink until some three to four weeks later.  As Mrs Walsh stated in evidence, Centrelink informed her they had not made the payment.  While she then checked with her bank, she did not do so until some six weeks after she received the money.

2. In this connection Mr Kouris drew the Tribunal's attention to the decision of the Federal Court in Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 152 ALR 127, where the Court stated that a person does not receive monies in good faith where the person knows, or has reason to know, that he or she is not entitled to use the monies as their own.

3. In determining whether the debt should be waived under the provisions of section 290C of the Act, I am satisfied that the debt did not result wholly or partly from Mrs Walsh, Mr Walsh, James or another person knowingly making a false statement or omitting to comply with a provision of the Act.

4. In Director-General of Social Services v Hales (1982) 47 ALR 281, a decision of the Full Court of the Federal Court, it was noted (Sheppard J), that "… the legislation provides for the payment of a variety of benefits to different classes of people who will usually have one thing in common: they will be impecunious and in straitened circumstances". His Honour also stated that the financial hardship experienced by people from whom the Commonwealth recovers money, must be balanced by consideration that the person has, for whatever reasons, received public money to which they are not entitled.

5. In Re Beadle and Director-General of Social Services (1984) 6 ALD 1, the Tribunal described "special circumstances" as an expression which is:

   "… by its very nature incapable of precise or exhaustive definition.  The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional.  Whether circumstances answer any of these descriptions must depend on the context in which they occur."

Upon appeal the Federal Court expressed broad agreement with this approach (Beadle v Director-General of Social Services (1985) 60 ALR 225.

1. It should be acknowledged that during the proceedings the Tribunal received into evidence a medical report dated 18 February 2000, which had been provided by Dr Pieta McLean.  The report states as follows:

   "To whom it may concern,
   Re:  Debra Walsh  16/09/1959
   I first saw this patient on 17 February 2000, but she has been attending this practice since 1995.  Debra's usual doctor, Dr Bowmaker is currently on maternity leave.
   From our files I can tell you that Debra was diagnosed with depression in July 1999 and commenced treatment at this stage.  It is likely that these symtoms (sic) may have been present prior to this date.
   Depression is usual multifactorial in its cause, and any stressful situation can exacerbate and contribute to symptoms.  Debra states that the prolonged resolving of Austudy payments has been quite distressing to her and this may have contributed to exacerbation of her depression.
   Not being her original treating doctor I apologise for not being able to give more information than this, but hope this assists you in your process."

2. Mr Kouris submitted that the content of the report does not of itself create special circumstances in that the depression experienced by Mrs Walsh seems to have been triggered by the requirement for repayment of the debt and "what we then have is a circular argument:  I'm depressed because I'm being asked to return the money, therefore there are special circumstances and I should not have to return it".

3. While I am naturally sympathetic in respect of Mrs Walsh's medical condition it cannot be said, however, that there are special circumstances when viewed in the light of the authorities to which I have referred.  The circumstances as presented by Mrs Walsh and her husband while unfortunate, cannot in my view be characterised as unusual, uncommon or exceptional.
   Decision

4. The decision of the Tribunal will be that the decision under review is affirmed.

   I certify that the 59 preceding paragraphs are a true copy of the reasons for the decision herein of:

   Mr B.G. Gibbs, AM, Senior Member

   Signed:.....................................................................................
     Personal Assistant

   Date/s of Hearing  13/4/2000
   Date of Decision  22/5/2000
   Counsel for the Applicant        Self-represented
   Solicitor for the Applicant         -
   Counsel for the Respondent    Mr Kouris
   Solicitor for the Respondent    Australian Government Solicitor