Walshe; Secretary, Department of Families, Community Services and Indigenous Affairs and
[2007] AATA 1861
•16 October 2007
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2007] AATA 1861
ADMINISTRATIVE APPEALS TRIBUNAL )
) No A 2006/282
GENERAL ADMINISTRATIVE DIVISION )
Re SECRETARY, DEPARTMENT OF FAMILIES, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS Applicant
And
BRIAN WALSHE
Respondent
AND
No A 2006/283
Re SECRETARY, DEPARTMENT OF FAMILIES, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS Applicant
And
JOAN WALSHE
Respondent
DECISION
Tribunal Justice Downes, President
J.W. Constance, Senior Member
Date16 October 2007
PlaceCanberra
Decision 1) The decisions of the Social Security Appeals Tribunal made on 27 July 2006 are set aside. The seven letters identified in this Tribunal’s reasons for decision provide adequate notice under the Social Security (Administration) Act 1999 (Cth) and the Social Security Act 1991 (Cth).
2) The matters are remitted to the Secretary, Department of Families, Community Services and Indigenous Affairs for reconsideration in accordance with these reasons.
..................[sgd]................
Garry Downes
President
CATCHWORDS
SOCIAL SECURITY – Pensions, allowances and entitlements – age pension – variation, suspension and cancellation – requirement for notice – request for review – limited review 13 weeks after notice – adequate notice given – limited review applies.
Social Security (Administration) Act 1999 (Cth) ss 78, 79, 80, 109
Social Security Act 1991 (Cth)
Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138
Campomar Sociedad, Limitada v Nike international Ltd (2000) 202 CLR 45
Department of Family and Community Services v Kakias [2006] AATA 345
Re Peura v Secretary, Department of Family and Community Services (2003) 78 ALD 570
Secretary, Department of Family and Community Services v Rogers (2000) 104 FCR 272
Secretary, Department of Employment and Workplace Relations v Spinapolice [2006] AATA 191
REASONS FOR DECISION
16 October 2007 Justice Downes, President
J.W. Constance, Senior Member
INTRODUCTION
1. The question in this application is whether various letters sent by the Department of Families, Community Services and Indigenous Affairs to Mr and Mrs Walshe were valid notices of changes to their age pension entitlements. The Department seeks review of the decisions of the Social Security Appeals Tribunal that they were not. The giving of a valid notice of change determines the period during which the Secretary of the Department is required to implement a decision on review which is favourable to the pensioner. Seven different forms of letters which the Secretary claims are valid notices are before us.
2. For the reasons which follow we have decided that all of the letters are valid notices in accordance with the Social Security Act 1991 (Cth) and the Social Security (Administration) Act 1999 (Cth).
BACKGROUND
3. Mr and Mrs Walshe first received the age pension in 1999 following Mr Walshe’s retirement from full-time employment. From that time Mr Walshe received an income from part-time employment. This income varied both in the amounts received and in the frequency of payments. As he was required to do, Mr Walshe advised the Secretary of the Department of the changes as they occurred. On receipt of each advice the Secretary adjusted the pension payable to both Mr and Mrs Walshe. At times adjustment included the cancellation or suspension of the pension payments.
4. Initially, payments were made under the Social Security Act 1991 (Cth). From 20 March 2000 payments were made under the Social Security (Administration) Act 1999 (Cth). Some of the letters under consideration were sent under the earlier Act, but the provisions relating to the giving of notices are the same in each Act and nothing turns on the change in legislation. We will therefore refer to sections in the Administration Act only.
5. Age pensions are paid fortnightly in arrears and, in the case of Mr and Mrs Walshe, the amount payable to each of them was in part determined by their combined income from one fortnight to the next. Once the Secretary made a determination as to the amount of pension payable, that determination remained in force until another determination was made.[1]
[1] Section 123 Social Security (Administration) Act 1999.
6. A person who is dissatisfied with a decision of the Secretary altering the amount of pension payable is entitled to ask the Secretary to review that decision.[2] There is no limit on the time in which such a request can be made. However, there are limits on the time during which a favourable decision will be applied. This depends on whether notice of the original decision was given to the recipient of the pension. This is provided for in s 109 of the Act.
[2] Section 129 of the above Act.
7. The effect of s 109 is as follows:
·if notice of the original decision is given and an application for review is made within 13 weeks of the notice, a favourable decision takes effect from the date of the original decision;
·if notice of the original decision is given and an application for review is made more than 13 weeks after the notice, a favourable decision takes effect from the date of the application for review; and
·if notice of the original decision has not been given, a favourable decision, on the motion of the Secretary, takes effect from the date of the original decision, no matter when the application for review is made.
8. In April 2005 Mr and Mrs Walshe’s financial planner sought review of a number of determinations of the Secretary, all of which changed the amounts of the pensions payable to them. The Centrelink authorised review officer found that, while the original decisions may have been incorrect, the review application was made out of time, so no favourable decision could be made in relation to them. In accordance with s 109, the periods for which favourable decisions take effect depends on whether notices of the original decisions were given.
ISSUES FOR DETERMINATION
9. By agreement between the parties seven different forms of letter are before us. The issue for determination in each case is whether the letter is a valid notice of an original decision by the Secretary for the purposes of s 109 of the Administration Act.
10. We will set out the form of each letter when we come to consider it individually. Before we do this we will make some observations relevant to the giving of the required notice.
THE STATUTORY REQUIREMENTS OF NOTICE
11. In considering whether a valid notice of a decision under an Act of Parliament has been given it is essential to look at the provision or provisions of the Act which determine what decision is required. For these applications, the decisions of which notice is required are set out in ss 78, 79 and 80 of the Act.
12. Section 78 provides:
If the Secretary is satisfied that the rate at which a social security payment is being, or has been, paid is less than the rate provided for by the social security law, the Secretary must:
(a) determine that the rate is to be increased to the rate provided for by the social security law; and
(b) specify the last‑mentioned rate in the determination.
13. Section 79 provides:
(1) If the Secretary is satisfied that the rate at which a social security payment is being, or has been, paid is more than the rate provided for by the social security law, the Secretary is to:
(a) determine that the rate is to be reduced to the rate provided for by the social security law; and
(b) specify the last‑mentioned rate in the determination.
14. Section 80 provides:
(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,
the Secretary is to determine that the payment is to be cancelled or suspended.
15. The letters sent to Mr and Mrs Walshe relate to decisions made by the Secretary under ss 78, 79 and 80. These decisions are the “original” decisions referred to in s 109.
16. For the requirements of s 109 to be met it is necessary that a notice be given “informing the person of the original decision”. It is clear that there are two elements of a decision under ss 78 and 79:
(a)that there be an increase or reduction (depending on which section is applicable) in the rate of pension; and
(b)the amount of the newly determined rate of pension.
The requirements of both subparagraphs (a) and (b) must be met.
17. When making a decision under s 80, the Secretary must decide two things:
(a)the person does not qualify or the pension is not payable; and
(b)whether the appropriate consequence is cancellation or suspension.
18. During argument before us it was suggested that the reference to “last-mentioned rate” in ss 78 and 79 is a reference to the rate of pension last determined before the newly determined rate. We do not accept this interpretation. The “last-mentioned rate” in each section refers to the words “the rate provided for by the social security law” which is the rate which the Secretary determines is payable in future. This accords with the ordinary grammatical construction of the words used.
19. Section 109 requires that notice of the decision be given. It does not require that notice of the reasons for the decision be provided: Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138 at 145.
20. In Secretary, Department of Family and Community Services v Rogers (2000) 104 FCR 272 Cooper J was dealing with a requirement for notice under a provision of the Act not relevantly different to s 109. His Honour said:
A notice is a notification, a making known, a communication of some matter from one person to another. In this statutory context, the statute identifies the matter to be notified by the notice…
In my view, the matter to be communicated by the "notice"… is the making of a decision in relation to a SPP [Single Parent Pension] which is a reviewable decision under s 1240 of the Act. That involves two elements: the fact that a decision has been made and the content of the decision…
The requirement that the communication be intelligible, which is referred to in Long v Minister for Immigration, Local Government and Ethnic Affairs (1996) 65 FCR 164… is not one which requires that the reasons for the decision be given or that sufficient information be given for the purposes found by the AAT. Jenkinson J in Long, meant no more than the means employed to communicate the decision must be intelligible to the person to whom the notice is to be given so that the person is informed of the making of the decision and the content of it. (Emphasis added)[3]
[3] At paragraps 31, 33 and 35.
21. In deciding whether a particular letter effectively conveys the information required it is appropriate to consider how the letter would be read by ordinary or reasonable persons within the group of persons to whom the information is directed. This is similar to the approach taken by the High Court of Australia in considering representations made to members of the public under the Trade Practices Act 1974 (Cth): Campomar Sociedad, Limitada v Nike international Ltd (2000) 202 CLR 45 at 85.
CONSIDERATION OF INDIVIDUAL LETTERS
22. At the hearing the parties provided us with copies of four letters addressed to Mr and Mrs Walshe’s accountants, two referring to Mr Walshe and two referring to Mrs Walshe.[4] It was agreed that there was no issue concerning the addressee of these letters. One of the letters related to an adjustment in the rate of pension and the other related to suspension of pension. The letters were identical for both Mr and Mrs Walshe. Later the parties provided samples of all the differently phrased letters sent by the Secretary to Mr or Mrs Walshe.[5] It has been agreed that we should decide whether letters in each form are notices in accordance with the requirements of s 109 of the Act. There are seven representative letters.
Letter 1: letter dated 7 October 2005 addressed to Quadrant Securities and headed “About Brian J Walshe”
[4] Exhibit 1.
[5] These groups of letters have been marked exhibits 2,3,4 and 5 respectively.
23. The relevant part of the front of the letter is set out as follows:
Your Age Pension
Payment from 06/10/2005 – 19/10/2005 due on 21/10/2005 $196.14
Regular payment from payday 04/11/2005
Age Pension $205.34
Plus Pharmaceutical Allowance + $2.90
Total $208.24
INFORMATION USED FOR CALCULATING YOUR REGULAR PAYMENT
Combined Annual Income $18,980.26
Combined Regular Fortnightly Earnings $504.27
24. On many of the letters there is a statement in large print: “Please read the back of this letter”. On the back of each letter there are two columns containing various information for the recipient, including, at the top of the second column:
“YOUR RIGHTS
If you think our decision is wrong, please phone us or come in and see us.”
25. This letter clearly states that the payment due on the next payday (21/10/2005) is $196.14 and that the regular payment from the following payday (04/11/2005) is $208.24. The words “payment” and “regular payment” are in bold type, as are the two differing payments. The letter provides adequate notice.
26. While the letter does not use the word “increase” in relation to the payment, a reasonable person reading the document would immediately understand that there has been an increase in the amount payable from one payday (21/10/05) to the next (4/11/05) and that the higher amount will be the regular payment from the later date. In addition, the newly determined rate payable from 4 November 2005 is clearly stated. This is a notice within the meaning of s 109 as it communicates to the recipient in intelligible form the two aspects of the decision required by s 78, i.e. that the rate is to be increased and what the new rate will be. Although it is obvious from the body of the document that a decision to increase the pension has been made the reference to a “decision” on the second page of the document reinforces the message that a decision has been made.
Letter 2: letter dated 15 December 2005 addressed to Quadrant Securities and headed “About Brian J Walshe”
27. The relevant part of the front of the letter is as follows:
Suspension of your Age Pension
INFORMATION USED FOR CALCULATING YOUR PAYMENT
Combined Annual Income $18,980.26
Combined Regular Fortnightly Earnings $504.27
4 IMPORTANT INFORMATION
Your Age Pension has been stopped because you and your partner’s earnings are above the allowable limit.
28. This letter makes it clear that that a decision has been made to stop payment of the pension and, although it does not state that the new rate of pension will be nil, this is the only intelligible interpretation of the communication. The letter does not state the date of the suspension. However, any reasonable reader would read it as applying from the next payment day. Any moderately intelligent pensioner receiving this letter would know that his or her pension had been suspended. If he or she needed confirmation of the fact that the suspension was based on a decision, that statement appeared on the reverse. A reason for the decision is given in the point headed “Important information”. To the extent to which the pensioner needed to be informed of the decision so that consideration could be given to an application for review, the pensioner would not be put off by the absence of a date. The document needs to be construed in a practical fashion and not by reference to academic analysis. No pensioner in receipt of a fortnightly pension would be likely to be in any doubt of the decision that had been made.
29. We note that ss 78, 79 and 80 do not refer to the date from which the decision is to operate. No doubt this is because the legislature assumed it would have immediate effect. If the legislation can be understood without any reference to date, we cannot see why the notice would not similarly be understood. This letter provides adequate notice.
Letter 3: letter dated 12 October 2001 addressed to Mr Walshe
30. The relevant part of the front of the letter is as follows:
Cancellation of your Age Pension
INFORMATION USED FOR CALCULATING YOUR FINAL PAYMENT
Combined Annual Income $56,919.11
4 IMPORTANT INFORMATION
Your Age Pension has been cancelled because the combined income of you and your partner is above the allowable limit.31. For the reasons set out in relation to letter 2 referring to the suspension of the pension, we are satisfied that this letter provides adequate notice.
Letter 4: letter dated 5 December 2001 addressed to Mr Walshe
32. The relevant part of the front of the letter is as follows:
Cancellation of your Age Pension
Payment from 22/11/2001 – 05/12/2001 due on 07/12/2001 $9.96
INFORMATION USED FOR CALCULATING YOUR FINAL PAYMENT
Combined Annual Income $56,767.26
4 IMPORTANT INFORMATION
Your Age Pension has been cancelled because the combined income of you and your partner is above the allowable limit.33. This letter differs from letter 3 in that it contains the additional information of the payment for the period up to 5 December 2001, the date of the letter. This information assists to make an even clearer case that the letter provides adequate notice. We so find.
Letter 5: letter dated 13 November 2001 addressed to Mr Walshe
34. The relevant part of the front of the letter is as follows:
Your Age Pension
Regular payment from payday 23/11/2001
Age Pension $190.45
Plus Pharmaceutical Allowance + $2.90
Total $193.35
INFORMATION USED FOR CALCULATING YOUR REGULAR PAYMENT
Combined Annual Income $24,979.14
35. This letter differs from letter 1 in that it only specifies the “Regular payment” from the next payday. The letter does not contain information on its face stating that there has been a change either by way of increase or reduction. This is accordingly the least specific of all the letters before us. Nevertheless, in the hands of a pensioner who is regularly receiving a pension, the purport of the letter would be clear. The pensioner would know that these letters are not received every fortnight. He or she would know from that fact and the note on the reverse that the letter was giving notice of a decision. To be told that the payment “from” 23 November 2001 is to be $193.35 is to be told that prior to that it was something else. It is to be noticed that, in terms, ss 78 and 79 require only the specification of the new rate. This letter provides adequate notice.
Letter 6: letter dated 20 December 2001 addressed to Mr Walshe
36. The relevant part of the front of the letter is as follows:
Your Age Pension
Payment from 19/12/2001 – 31/12/2001 due on 02/01/2002 $236.30
Payment from 14/01/2002 – 14/01/2002 due on 16/01/2002 $9.00
Regular payment from payday 16/01/2002
Age Pension $251.58
Plus Pharmaceutical Allowance + $2.90
Total $254.48
INFORMATION USED FOR CALCULATING YOUR REGULAR PAYMENT
Combined Annual Income $17,032.24
4 IMPORTANT INFORMATION
Your payment includes a Telephone Allowance amount of $9.00. This Allowance is paid every three months.37. This letter is in the same form as letter 1, except it has an additional line of information relating to a payment for one day (in this case 14/01/02). This additional information does not detract from the other information and, for the reasons stated in relation to letter 1, we are satisfied that this letter provides adequate notice.
Letter 7: letter dated 5 November 2001 addressed to Mr Walshe
38. The relevant part of the front of the letter is as follows:
Your Age Pension
Immediate payment 23/10/2001 to 24/10/2001 due on 07/11/2001 $31.99
Regular payment from payday 09/11/2001
Age Pension $221.02
Plus Pharmaceutical Allowance + $2.90
Total $223.92
INFORMATION USED FOR CALCULATING YOUR REGULAR PAYMENT
Combined Annual Income $21,005.56
39. This letter is in the same form as letter 1, except that it refers to an “immediate payment” rather than simply “payment”. This is because the payment is due immediately, rather than in two weeks, as was the case for letter 1. For the same reasons as we have given in relation to letter 1, this letter provides adequate notice.
GENERAL OBSERVATIONS
40. In determining what, as a matter of fact, is adequate notice under s 109, it is appropriate to consider the purposes of the notice. The main purpose of the notice must be to inform the pensioner whether he or she will receive further pension payments and what they will be. A further purpose will be to give notice of change. However, it is not necessary to ignore the fact that the pensioner will know what pension he or she has been receiving. Nor is it necessary to ignore the fact that, in many cases, the new rate will be a response to a change in circumstances notified by the pensioner. There is an air of unreality in hypothesizing that a pensioner receives letters like the letters in question and is not aware that they involve a change in pension payments which might be subject to an application for review. In the present case the applications for review were prompted by an audit by the pensioners’ financial adviser long after the event. It has not been suggested that Mr and Mrs Walshe were in fact unaware of the changes. However, we accept that the test is not subjective, but objective.
41. It has been said many times that one of the important roles of this Tribunal is to improve the quality of decision-making generally. Although the letters constitute adequate notice, they should be prepared to much more clearly identify the elements of the decisions in accordance with the legislation. There are a number of discrepancies in the notes under the heading “Important information”. For example, some of the letters state “Your superannuation pension has changed”, but others do not. Some state “You may be able to receive help from us under the pension loans scheme” and others do not. Of the letters that state “Your payment includes a Telephone Allowance amount…”, some include a corresponding “Payment” line with this amount and others do not. The Secretary should immediately take steps to have the notices redrafted for clarity and consistency. The new form of letter should at least inform the recipient that:
·a decision has been made changing the recipient’s pension entitlement;
·the nature of the change, be it increase, decrease, suspension or cancellation;
·the date the change takes effect;
·the amount of the old entitlement; and
·the amount of the new entitlement.
PREVIOUS DECISIONS OF THE TRIBUNAL
42. Counsel on both sides referred us to previous decisions of the Tribunal in Secretary, Department of Employment & Workplace Relations v Spinapolice [2006] AATA 191 and Department of Family and Community Services v Kakias [2006] AATA 345. These decisions highlight the difficulties which arise when the Tribunal is asked to decide upon the form of a notice without being provided with an exact copy of the document in question. It appears that in both of these matters the Tribunal was asked to decide upon the basis of computer printouts which disclosed the information contained in the various notices in unformatted fashion. Words in bold did not appear. There was no emphasis. Single lines contained material which was on two lines in the documents as sent. The printed notes were omitted.
43. In the matter before us the hearing commenced with only computer printouts available. We required the parties to provide copies of the actual notices. In matters where the Tribunal is being asked to decide whether a document is an effective notice it is to be expected that the lay-out and format used in the document will be of importance. In such matters the documents filed pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) should include copies of the actual documents in question.
44. The decision in Spinapolice is partly consistent with our reasoning. The Tribunal held that advices to a pensioner which set out the current payment followed by the new payment were sufficient notices under s 109 of the Administration Act. It is clear that the member hearing the matter did not have the actual letters before him.
45. In Kakias it appears that the letter under consideration was in the form of letter 1. It is clear that the member did not have before her the actual letter she was being asked to decide upon. Her description of the text of the letter taken from the computer printout does not show the contrast between the two different payments. This contrast is apparent in the form of the letter before us. This may account for the different conclusions.
46. A different form of letter concerning the payment of the age pension was considered by the Tribunal in Re Peura and Secretary, Department of Family and Community Services (2003) 79 ALD 570. In that matter the Tribunal found that the decision which was required to be notified was that there had been a change in the way that the recipient’s assets were being assessed and that this notification had not occurred.
47. Nothing in the reasoning in Spinapolice, Kakias or Peura causes us to reconsider our decision or the observations we have made about notices.
48. For the record, there have been at least 19 Tribunal decisions on adequacy of notice since 2000.[6] Of those, 12 have decided that Centrelink letters are adequate notices.[7]
[6] Plug [2000] AATA 744; Peura [2003] AATA 1123; Tangney [2003] AATA 1172; Casperz [2003] AATA 1300; Laurent [2004] AATA 612; Rowe [2004] AATA 1160; Fairweather [2005] AATA 201; Hutton [2005] AATA 330; Rigg [2006] AATA 9; Garforth-Dankmeyer [2006] AATA 166; Spinapolice [2006] AATA 191; Kakias [2006] AATA 345; Sharpe [2006] AATA 402; Cameron [2007] AATA 1039; Palmer [2007] AATA 1067; Walton [2007] AATA 1362; Cowan [2007] AATA 1473; Golden [2007] AATA 1585; Winchester [2007] AATA 1825.
[7] Plug; Tangney; Casperz; Laurent; Rowe; Fairweather; Hutton; Rigg; Spinapolice (in part); Sharpe; Palmer; Walton.
DECISION
49. We will set aside the decisions of the Social Security Appeals Tribunal and substitute decisions that the seven letters considered in these reasons are adequate notices under the Social Security (Administration) Act 1999 (Cth) and the Social Security Act 1991 (Cth). The matters will be remitted to the Secretary of the Department for reconsideration in accordance with these reasons.
I certify that the 49 preceding paragraphs are a true copy of the reasons for the decision herein of Justice Downes, President and J. W. Constance, Senior Member.
Signed: ...........[sgd]....................................................
Julia Powles, AssociateDate of Hearing 3 September 2007
Date of Decision 16 October 2007
Counsel for the Applicant B Dube
Solicitor for the Applicant Sparke HelmoreCounsel for the Respondent G Mahony
Solicitor for the Respondent Purcell Lawyers
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