Warren Westbrook and Secretary, Department of Social Services
[2014] AATA 700
•25 September 2014
[2014] AATA 700
Division GENERAL ADMINISTRATIVE DIVISION File Number
2012/0666
Re
Warren Westbrook
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
Decision
Tribunal Senior Member N A Manetta
Date 25 September 2014 Place Adelaide
The Tribunal:
(a) remits the decision to the respondent, under section 42D(1) of the Administrative Appeals Act, so that the respondent can recalculate, in accordance with these reasons, Mr Westbrook’s overall level of net indebtedness to the respondent;
(b) directs the recalculation, with appropriate supporting workings, to be advised to Mr Westbrook and the Tribunal within 21 days of the date hereof.
(c) directs that the matter be called on in approximately one month’s time on a date to be advised.
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Senior Member N A Manetta
Catchwords
SOCIAL SECURITY – Age pension – review of varied decision taken by respondent – departmental decision to seek recovery of an alleged overpayment– wife’s income relevant to applicant’s pension entitlement overestimated – matter previously remitted to respondent under s 42D of the Administrative Appeals Tribunal Act – gross income – expenses incurred in the earning of income irrelevant – averaging over preceding 13 week period or over a full year –decision remitted to respondent for further minor recalculation.
Legislation
Social Security Act 1991
Administrative Appeals Tribunal Act 1975, s 42D, s 42D(3)(b)(i)
Cases
Re Westbrook and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2013] AATA 247; 60 AAR 23
Re Michael and Secretary, Department of Employment, Science and Training [2006] AATA 227; 90 ALD 457
Haldane-Stevenson v Director-General of Social Security (1985) 7 ALD 467; 9 FCR 73
Secretary, Department of Employment and Workplace Relations v Richards [2008] FCAFC 97; 168 FCR 438
REASONS FOR DECISION
Senior Member N A Manetta
25 September 2014
This is an application by Mr Warren Westbrook under section 42D(3)(b)(i) of the Administrative Appeals Act, 1975 for review of a varied decision taken by the respondent concerning his age pension under the Social Security Act, 1991 (the Act). The matter has some considerable history in this Tribunal. I shall set out salient features of the procedural history as well as the background facts and then the key questions which are to be decided.
procedural history and background facts
Mr Westbrook receives an age pension under the Act. He maintains that a departmental decision to seek recovery from him of an alleged overpayment has been erroneous. The period during which Mr Westbrook was allegedly overpaid began in March 2009 and ended in June of that year. Mr Westbrook maintains that his wife’s income, which was relevant to a calculation of his own pension entitlement, has been overestimated by the Department.
Mr Westbrook was dissatisfied with the Authorised Review Officer’s internal review of the departmental decision and, on appeal, with the decision of the Social Security Appeal Tribunal (SSAT), which affirmed the Officer’s decision. His application to this Tribunal came before Deputy President Jarvis, who delivered his decision on 24 April 2013.[1] Deputy President Jarvis remitted the matter to the respondent under section 42D of the Administrative Appeals Act 1975. The respondent was directed to recalculate Mr Westbrook’s entitlement to an age pension in light of his reasons.
[1] [2013] AATA 247; 60 AAR 23.
The respondent reconsidered the matter and advised Mr Westbrook of its varied decision by letter dated 26 August 2013. In the meantime, Deputy President Jarvis had retired, and by order of the President of the Tribunal dated 1 November 2013, I was appointed to constitute the Tribunal for the purposes of completing any further proceedings. Mr Westbrook was dissatisfied with the recalculation and elected under s 42D(3)(b)(i) of the Administrative Appeals Act to proceed with his application for review of the respondent’s decision as varied.
It will help to summarise what Deputy President Jarvis decided, the respondent’s decision on remittal, and how the matter has progressed before me. The Deputy President considered Mr Westbrook’s application for review by reference to three periods, as had the Authorised Review Officer (ARO). The three periods in question were as follows: first, 27 March to 9 April 2009; secondly, 10 April to 4 June 2009; and thirdly, 5 June to 30 June 2009.
Decision in respect of the third period: 5 June to 30 June 2009
In respect of the third period, the Deputy President concluded, at paragraph [13] of his reasons, that he would not investigate Mr Westbrook’s contentions for reasons which I need not set out.
Decision in respect of the second period: 10 April to 4 June 2009
In respect of the second period, the Deputy President concluded that the decision of the respondent should be remitted for reconsideration. He specifically referred to certain work-related expenses incurred by Mrs Westbrook and required the respondent to consider whether these should be taken into account to reduce Mrs Westbrook’s income for the purposes of calculating Mr Westbrook’s pension entitlement. Mr Westbrook was clearly unsuccessful, however, in arguing before the Deputy President that his wife’s average weekly income during the period should be determined by reference to an annual average. The Deputy President concluded that Mrs Westbrook’s income should be averaged over the 13 weeks prior to 4 June 2009 only.[2]
[2] At paragraph 25(b) of his reasons.
Decision in respect of the first period: 27 March to 9 April 2009
The Deputy President noted that the Tribunal had already considered this period in earlier proceedings (conducted before Senior Member Bean, as she then was). He concluded that her decision appeared to be correct on the evidence then before her. He decided, nevertheless, to direct that this period be re-opened and included in the respondent’s reconsideration because it formed part of the 13-week period that should be used to calculate Mrs Westbrook’s income. He considered it would be inappropriate to use different methodologies to calculate the income that was to be attributed to Mrs Westbrook. Accordingly, although the Deputy President was clearly of the view that “[a]s a general rule, this tribunal should not reconsider a matter which has already been determined by the tribunal in earlier proceedings”,[3] the circumstances were unusual enough to warrant a re-opening of the calculation of Mrs Westbrook’s income for this period as well.
[3] At paragraph [32] of his reasons.
Respondent’s decision on remittal
Mr Westbrook’s pension entitlement was, as I have said, recalculated. According to the letter from the respondent addressed to Mr Westbrook dated 26 August 2013, the recalculation of Mr Westbrook’s overpayment has resulted in the amount owing to Centrelink being reduced to $184.28 for the period 27 March 2009 to 9 April 2009 (the first period).
So far as the second period is concerned, I assume that the respondent maintains that a credit of $62.10 in Mr Westbrook’s favour exists. It is not clear to me on the file material whether this amount has been paid to Mr Westbrook. As I have already noted, the third period was ruled by the Deputy President to be one in respect of which Mr Westbrook was not eligible to make an application for review to the Tribunal.
MR WESTBROOK’S APPLICATION FOR REVIEW OF THE DECISION AS VARIED
Mr Westbrook was dissatisfied with the recalculation of the debt and, as I have noted, elected under section 42D(3)(b)(i) of the Administrative Appeals Act to continue his application for review of the decision as varied. When the matter came to me after Deputy President Jarvis’ retirement, the parties agreed to isolate the issues that remain of concern to Mr Westbrook. I first required Mr Parker, appearing for the respondent, to set out in a letter the income said to have been earned by Mrs Westbrook in the relevant 13-week period. In a letter to Mr Westbrook dated 25 March 2014, he did so. The following table was produced by him which informed submissions:-
Pay Period Payment Date Gross Salary Reference 28/2/2009 – 13/3/2009 17/3/2009 $631.66 Payslip (refer Payslip marked ‘1’) 14/3/2009 – 27/3/2009 Not known $1,189.03 Advised by Mr Westbrook - letter dated 5/11/2013 (refer Attachment 2) 28/3/2009 – 10/4/2009 10/4/2009 $1,294.80 Payslip (refer Payslip marked ‘2’) 11/4/2009 – 24/4/2009 24/4/2009 $1,355.22 Payslip (refer Payslip marked ‘3’) 25/4/2009 – 8/5/2009 12/5/2009 $1,100.80 Payslip (refer Payslip marked ‘4’) 9/5/2009 – 22/5/2009 22/5/2009 $561.83 Payslip (refer Payslip marked ‘5’) 23/5/2009 – 4/6/2009 - No income earned -
It can be seen that the table identifies seven fortnightly periods or 14 weeks, not 13 weeks. Mr Parker’s letter went on to note as follows:
“As the relevant period commenced during the period covered by the first payslip, an adjustment has been made to reflect only that portion of Mrs Westbrook’s earnings derived between 5 March 2009 and 13 March 2009.
The adjustment is described below:
1. Total income for the period 28/2/2009 to 13/3/2009 = $631.66.
2. Average income per day over the 14 day pay period = $45.12 (632.66/14).
3. Income for the period 5/3/2009 to 13/3/2009 (9 days) = $406.08 (9 x $45.12).
Hence, the amount of $406.08 has been used in averaging Mrs Westbrook’s earnings over the relevant period rather than the reported figure of $631.66.”
Directions hearing on 3 April 2014
I held a directions hearing on 3 April 2014. The parties finalised their agreement on many issues at that directions hearing and identified the three outstanding areas of contention. I append to these reasons a copy of the direction I gave in the matter on that day which sets out the areas of agreement and of contention (the Direction). The matter was subsequently set down for hearing in respect of the three areas of contention.
AREAS OF CONTENTION between the parties and their resolution
First area of contention: income in the first fortnightly period
As Note 3 of the Direction indicates, Mr Westbrook maintains that of the $631.66 earned by his wife in the period 28 February 2009 to 13 March 2009, one-half only should be taken into account for the purposes of calculating his wife’s income over the 13-week period. Mr Parker initially maintained that nine-fourteenths of this amount should be taken into account, but indicated at the hearing that the respondent would accept Mr Westbrook’s contention. I am content to accept this concession and accordingly, I find in Mr Westbrook’s favour on this issue.
Instead of $406.08 being used for the calculation of Mrs Westbrook’s income, $315.83 is appropriate. There will need to be a further recalculation, albeit a minor one.
Second area of contention: treatment of expenses
As Note 4 of the Direction indicates, Mr Westbrook submitted that a number of expenses were incurred by his wife in the earning of income. He submitted these should be taken into account to reduce the gross amounts appearing in the table at paragraph [11] above. Mrs Westbrook is a respite care giver employed principally, as I understand the evidence, with an organisation called “Riverland Respite”. Mr Westbrook sought to have her income receipts reduced by costs she met in respect of, amongst other things, mobile phone calls, meals, car use, her uniform and laundering.
Mr Parker submitted, however, that s 1072 of the Act prevents any reduction of her gross salary. This section provides that a reference to a person’s ordinary income in the Act is a reference to the “person’s gross ordinary income from all sources without any reduction …” (emphasis supplied). I note that there is an exception that immediately follows: “other than a reduction under Division 1A”.
In my opinion, this section is conclusive. The section explicitly requires Mrs Westbrook’s gross income to be taken into account, not net income after expenses have been deducted. Mr Westbrook submitted Mr Parker’s submission was inconsistent with the Federal Court’s decision in Haldane-Stevenson v Director-General of Social Security (1985) 7 ALD 467; 9 FCR 73. This decision concerned the 1947 Act, which did not have an express stipulation in this regard.[4] It is not relevant to the construction of the explicit provision in s 1072 of the current Act. I note further that the exception concerning reductions under Division 1A is irrelevant to Mrs Westbrook’s circumstances.
[4] See at ALD at p.468; FCR at p.75.
As an alternative, Mr Westbrook pressed a submission that the decision of the Federal Court in Secretary, Department of Employment and Workplace Relations v Richards [2008] FCAFC 97; 168 FCR 438 required the respondent to reduce Mrs Westbrook’s income by the expenses she had incurred. In my opinion, this case does not assist Mr Westbrook. In the unusual circumstances of Richards’ case, Ms Richards was obliged under her contract of employment to make good from her wages any shortfalls in the TAB till for which she was responsible while working as a hotel employee. The Court held that her income for the purposes of calculating her entitlement to a parenting benefit under the Act was the amount she in fact received from her employer, after the shortfall had been deducted.
Mrs Westbrook is in a different position, however. She simply met her own expenses. She was not required to pay back to her employer any of the amounts she earned, nor did her employer pay her expenses and deduct equivalent sums from her salary. I think her situation is clearly distinguishable from Ms Richards’. Accordingly, I decide against Mr Westbrook on this issue.
Third area of contention: Deputy President Jarvis’s ruling on averaging
Mr Westbrook argued that he ought to be heard again on the question of whether Mrs Westbrook’s income should be determined by looking at an average over the preceding 13 weeks or an average over a full year. He maintains the latter is appropriate.
Deputy President Jarvis dealt with this issue and he decided it against Mr Westbrook.[5] At the directions hearing on 3 April 2014, I gave Mr Westbrook liberty to make a specific submission on the question of whether I should re-open the issue. Mr Westbrook submitted Deputy President Jarvis was in error, but did not put to me any compelling circumstance justifying a departure from the general rule[6] that the Tribunal should not reconsider a matter that has already been determined by it. Accordingly, I decline to consider a challenge by Mr Westbrook to Deputy President Jarvis’s decision in this regard.
[5] See paragraph [21] of his reasons.
[6] Cf Re Michael and Secretary, Department of Employment, Science and Training [2006] AATA 227; 90 ALD 457.
conclusion
It follows, in my view, that the respondent will need to undertake a further revision of Mr Westbrook’s pension entitlement in light of the slightly reduced figure in respect of the first fortnightly period identified in the table. I also remain unclear whether the amount of $62.10 has been paid to Mr Westbrook, and if it has not, whether it has been netted off against any amount said to be owing.
I shall remit the decision to the respondent, under section 42D(1) of the Administrative Appeals Act, so that the respondent can recalculate, in accordance with these reasons, Mr Westbrook’s overall level of net indebtedness to the respondent. This recalculation, with appropriate supporting workings, shall be advised to Mr Westbrook and the Tribunal within 21 days of the date of this decision. The matter will be called on in one month’s time, at which time, I shall consider the matter further with a view to making final orders.
I certify that the preceding 24 (twenty -four) paragraphs are a true copy of the reasons for the decision herein of Senior Member N A Manetta ........ [Sgd] ....................................
Administrative Assistant
Dated 25 September 2014
Dates of hearing 28 January 2014 and 13 May 2014 Applicant In Person Advocate for the Respondent Mr A Parker
Program Litigation and Review Branch
Department of Human Services
Administrative Appeals Tribunal
ADMINISTRATIVE APPEALS TRIBUNAL )
)No: 2012/0666
General Administrative Division )
Re: Warren Westbrook
Applicant
And: Secretary, Department of Social Services
RespondentTRIBUNAL: Senior Member N A Manetta
DATE: 3 April 2014
PLACE: Adelaide
NOTES
1.The parties have reached agreement at the directions hearing held today that no issue arises between the parties in respect of the allowances paid to Mrs Westbrook; and, in particular, it is noted that they have agreed as follows:-
(a) Motor Vehicle Allowance
No amount of motor vehicle allowance has been included in Mrs Westbrook’s income.
(b) First Aid Allowance
An amount of $4.15 per fortnight has been correctly included in Mrs Westbrook’s income for each of the following periods:
28/2/09 – 13/3/09
14/3/09 – 27/3/09
28/3/09 – 10/4/09
11/4/09 – 24/4/09
9/5/09 – 22/5/09
The figure of $4.15 was correctly calculated by taking the annual allowance of $228.00 and deducting from it an amount of $120.00 (being the amount Mrs Westbrook spent on a course for first aid) and then converting the difference of $108.00 into a fortnightly amount. ($108.00 ÷ 26 fortnights in a year = $4.15).
(c) Passive Allowance
A “passive allowance’ of $62.10 has been properly included in Mrs Westbrook’s income for the fortnight 28 March 2009 to 10 April 2009 and a “passive allowance” of $124.20 has been properly included in Mrs Westbrook’s income for the period 11 April 2009 to 24 April 2009.
2.The parties further agree that the gross salary figures for Mrs Westbrook that appear in Mr Parker’s letter of 25 March 2014 (page 1) are correct.
3.The parties disagree as to how the gross salary amount of $631.66 (referable to the period 28 February 2009 to 17 March 2009) should be accounted for. Mr Parker’s contention (for the respondent) is that nine-fourteenths of that amount should be included in Mrs Westbrook’s earnings over the 13 week period while Mr Westbrook contends seven-fourteenths (or a half) only should be included.
4.The parties agree that the expense items referred to in Mr Westbrook’s letter of 24 March 2014 have been incurred. The parties disagree, however, as to whether they may be deducted from Mrs Westbrook’s earnings. Mr Parker (for the respondent) maintains they may not be deducted under relevant legislative provisions; Mr Westbrook maintains they should be deducted.
5.Mr Westbrook wishes to submit that his wife’s earnings for the entire year should be aggregated and then converted to an average fortnightly amount, which should then be applied in the period 28 February 2009 to 4 June 2009. The Tribunal indicated at the directions hearing that it believed this issue had been resolved against Mr Westbrook in the decision reached by Deputy President Jarvis on 24 April 2013, but the Tribunal indicated it would allow Mr Westbrook an opportunity to address the Tribunal on whether it should re-open Deputy President Jarvis’ decision in this respect.
6.Otherwise, the parties are agreed no further issues in dispute arise on the application and the Tribunal can now proceed to determine the application by considering the issues in dispute.
DIRECTIONS
Having regard to the matters referred to above, the Tribunal directs as follows:
1.The Respondent is to file and serve a written submission by 23 April 2014. The submission is to address the areas of dispute in Note 3 and Note 4 above.
2.The Applicant is to file and serve by 7 May 2014 a written submission which addresses the areas of dispute in Note 3 and Note 4 above.
3.The Applicant shall be at liberty to include in its submissions a specific submission addressing the question of whether this Tribunal should re-open Deputy President Jarvis’ decision of 24 April 2013 in so far as it ruled against the averaging of Mrs Westbrook’s entire annual income to arrive at the relevant fortnightly amount.
4.Hearing of the application will take place on 13 May 2014 at 10:30am. Parties are to appear in person.
5.Liberty is granted to either party to apply for a further telephone directions hearing in respect of this matter.
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N A MANETTA
(Senior Member)
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