Watkins and Secretary, Department of Social Services (Social services second review)

[2018] AATA 4306

Watkins and Secretary, Department of Social Services (Social services second review) [2018] AATA 4306 (20 November 2018)

Division:GENERAL DIVISION

File Number(s):      2017/3240

Re:Mr Leonard Watkins

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Ms Anna Burke, Member

Date:20 November 2018  

Place:Melbourne

The Tribunal sets aside the reviewable decision and in substitution remits it to the Secretary with the direction that Mr Watkins’ debt should be reviewed and assessed on the basis of his actual assets and the estate’s ability to repay the debt.

.....................[sgd]...................................................

Ms Anna Burke, Member

Catchwords

SOCIAL SECURITY – Age Pension allowance –– overpayment– debt due to the Commonwealth – whether recovery of debt should be written off or waived – whether debt attributable solely to error made by Centrelink – no “special circumstances” – applicant now deceased - decision under review remitted for consideration

Legislation

Social Security Act 1991 (Cth)
Social Security (Administration) Act 1999 (Cth)

Cases

Re Callaghan and Secretary Department of Social Security [1996] 45 ALD 435

Re Anderson and Secretary, Department of Families and Community Services [2002] 69 ALD 494

Ryde v Secretary, Department of Family and Community Services [2005] FCA 866
Groth and Secretary, Department of Social Security [1995] FCA 1708; (1995) 40 ALD 541

Secondary Materials

Guide to Social Security Law (The Guide)

REASONS FOR DECISION

Ms Anna Burke, Member

1. Mr Leonard Watkins (the applicant), now deceased, lodged an objection to a Centrelink debt of $5,701.78 which he incurred as a result of overpayment of his aged pension in the period of 21 January 2015 to 26 July 2016.

2. Mr Watkins died on 22 November 2017. During the period of the disputed debt he had sold his family home in 2014, utilising part of the proceeds for an accommodation bond to enter a nursing home. He lost his wife of 65 years in January 2015, was suffering from dementia and was in the advanced stages of Alzheimer’s disease. Mr Watkins has three children; twin handicapped sons and Mr Peter Watkins, who lives and works overseas and who has acted as his father’s representative during this review process.

3. On 23 February 2016, according to a Centrelink file note, a customer service officer actioned records regarding a change in assets for Mr Watkins. Information, which was obtained via file records using internal channels, indicated that Mr Watkins had vacated his home on 22 April 2014, entered Central Park Aged Care Home and then relocated to Mayflower Brighton (another aged-care facility) on 18 November 2015. The file notes that Mr Watkins had been sent a customer letter on 11 March 2016 requesting information of entry contribution and, as no response had been received, payments had been suspended.

4. The file note indicates that Mr Watkins was contacted on 21 March 2016 regarding letters received requesting information of entry contribution. He advised Centrelink that his son had this information, was currently overseas, would be returning in approximately three weeks and would provide this information then.

5. On 18 October 2016 Centrelink issued Mr Watkins with a notice of recoverable debt of $5701.78, advising that the money was payable: “as the correct amount of your investments from Commonwealth Bank was not taken into account in the payments made to you”.

6. On 16 December 2016 an Authorised Review Office (ARO) affirmed the decision to raise the debt, noting:

   The department is reliant on yourself to notify of changes in your circumstances within 14 days of the event. This includes, but is not limited to you selling your home; the value of your financial investments changes by more than $2000; you giving away any assets, including cash investments. The expectation is that the sale of your former home on 21 January 2015 and the gifting of $200,000 cash on the 11 February 2015 is notified to the department within 14 days the event. Your rate of Age pension is then calculated on your changed income and asset information. As you did not give the department details of your changes in your circumstances, this means you have been paid more than you are entitled to receive.

7. A file note from the ARO dated 16 December 2016 indicates that: 

   successful contact with Mr Watkins nominee in which they discuss the debt.  Mr Watkins son advised there should be no debt as Centrelink was notified of changes as per scan sent on 23 May 2016. The ARO advised the changes are to be reported within 14 days of the event and Mr Watkins son states they were not aware of this so why should the customer be penalised. Mr Watkins son indicated to the ARO he and his father had attended in person the Windsor service centre in early March 2016 had waited 90 minutes before being told they could not be assisted and given a telephone number to call. Mr Watkins son advised the ARO that his father is very distressed about the demand letters being received provides his details for further contact.

8. On 5 May 2017, the Social Services and Child Support Division of the Administrative Appeals Tribunal (AAT1) affirmed the Department’s decision, stating:

   The Tribunal has found Mr Watkins correct level of income and assets were not taken into account in assessing Mr Watkins rate of pension. Mr Watkins was therefore paid more than his correct entitlement of age pension in the relevant period.

   ………………

   The Tribunal carefully considered all the matters put forward by Mr Watkins, including the manner in which the debt arose, Mr Watkins’ overall circumstances, including his health, his personal and family circumstances and financial situation. Taking in to account the matters put forward the Tribunal does not consider the Mr Watkins’ circumstances are “special” such that it would be unfair or inappropriate to recover the debt. The provisions in section 1237AAD were therefore not applied to waive the debt in this case.

9. On 5 June 2017 Mr Watkins sought a review of the AAT1 decision by the General Division of the Tribunal claiming the decision was wrong, stating:

   … note that my father had been paid the same pension amount for years prior to 21 January 2015, with the same level declared assets and pretty much the same level of financial value? So because the family home had to be sold to facilitate both he and his elderly wife going into aged care (being able to afford the mandatory aged care bonds required) why has Centrelink deemed that an ideal time to penalise him for shifting the same level of assets from one life necessity to another?

   …

   As my father has made significant, genuine and verified contact with Centrelink and provided them with accurate information about his financial circumstances (to the best of his ability) please convey to us exactly whose fault it was the correct level of income and assets was not take into account?

   We strongly contended here that this debt should be waivered, for as subsection 1237A(1) of the Act states, we feel this debt has been solely caused by Commonwealth administrative errors and that my father has unquestionably received these payments in good faith.

   …

   We trust this second review of decision can see the facts for what they are, realise that my father has made every attempt to update Centrelink within his diminished capacity and righteously concluded that it would be certainly be both unfair and inappropriate to even consider recovering the supposed debt. However if Centrelink is to continue to heartlessly pursue a 91-year-old pensioner with severe dementia, Alzheimer’s disease and depression, we will relentlessly pursue every legal avenue to resist paying this concocted an excessive debt.

10. The respondent in their statement of facts, issues and contentions dated 13 April 2018 contended that the effect of the level of Mr Watkins’ assets at 21 January 2015 was that he was not entitled to any pension and therefore sought an order that the decision of the AAT 1 be set aside and substituted with the decision that Mr Watkins had an age pension debt of $6,623.39 for the period 21 January 2015 to 19 May 2016

11. The application was heard via telephone on 15 August 2018. Mr Watkins, who is now deceased, was represented by his son, Mr Peter Watkins. Ms Alisa Bramley, a government lawyer in the Freedom of Information and Litigation Team of the Department of Human Services, appeared for the respondent.

    THE ISSUES IN CONTENTION

12. The Tribunal needs to consider the following relevant issues:

    (a)whether Mr Watkins was entitled to an age pension from 21 January 2015 to 26 July 2017; and if not

    (b)whether Mr Watkins was overpaid $6,623.39 for the period from 21 January 2015 to 26 July 2017; and if yes

    (c)whether the debt is recoverable; and if yes

    (d)should the debt be waived due to administrative error pursuant to section 1237A of the Social Security Act 1991 ("the Act"); or

    (e)do "special circumstances" exist such that the debt should be waived pursuant to section 1237AAD of the Act.

    LEGISLATIVE FRAMEWORK

13. Section 43 of the Social Security Act 1991(Cth) (‘the Act’) provides that a person is qualified for an age pension if:

    (1)  A person is qualified for an age pension if the person has reached pension age and any of the following applies:

    (a)  the person has 10 years qualifying Australian residence;

1.Eligibility for the age pension is then worked out by taking into account how much income an individual receives (the income test) and how much their assets are worth (the assets test). The test that results in the lower pension rate will be the one applied. An individual’s home, if they live in it, is not counted as an asset. If the assets exceed a certain threshold, pension payments will be reduced. Income includes money from employment; pensions/annuities; money deemed to be earned from investments; money that is gifted and money that is salary sacrificed. It also includes money from outside Australia. If the income is above a certain limit, pension payments will be reduced.

1. Section 44 of the Act provides that an age pension is not payable if pension rate is nil:

   (1)  Subject to subsection (2), an age pension is not payable to a person if the person’s age pension rate would be nil.

   (2)  Subsection (1) does not apply to a person if the person’s rate would be nil merely because an election by the person under subsection 915A(1) (about quarterly energy supplement) or 1061VA(1) (about quarterly pension supplement) is in force.

2. Section 55 of the Act provides for how a person’s age pension rate is worked out:

   (a)if the person is not permanently blind—using Pension Rate Calculator A at the end of section 1064 (see Part 3.2);

3. Section 1236 of the Act confers a discretion on the Secretary to write off a debt:

   (1)  Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.

   (1A)  The Secretary may decide to write off a debt under subsection (1) if, and only if:

   (a)  the debt is irrecoverable at law; or

   (b)  the debtor has no capacity to repay the debt; or

   (c)  the debtor's whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or

   (d)  it is not cost effective for the Commonwealth to take action to recover the debt.

   …

4. Section 1237A provides that the Secretary must waive the right to collect a debt if it is attributable solely to an administrative error:

   Administrative error

   (1)  Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.

   …

5. Section 1237AAD confers a discretion on the Secretary to waive all or part of the debt in special circumstances:

   The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

   (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, the Administration Act or the 1947 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.

   THE TRIBUNAL’S CONSIDERATION AND FINDINGS

   Evidence before the Tribunal

6. The evidence before the Tribunal included documents provided by the respondent pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, referred to as the “T documents”. Written statements were provided by Mr Watkins’ son.

   Notify changes in circumstances within 14 days of the event

7. The respondent contends that Centrelink sent Mr Watkins letters on 11 and 21 March 2016, with a questionnaire to be completed and returned within 14 days. This was following an internal review, as it had been ascertained that he had vacated his home on 22 April 2014. They argued there was no evidence that Mr Watkinson notified Centrelink of any changes in assets, particularly a cheque for $431,655.85 deposited into his bank account on 22 January 2015, until he returned the questionnaire to the Department on 23 May 2016. The respondent argued that a debt has arisen as Mr Watkins has not advised Centrelink of his change of assets within 14 days of the event occurring.

8. The respondent did not dispute that Mr Watkins had updated his financial circumstances with Centrelink from time to time. However, the issue was the 14-day requirement. The respondent explained that the legislation provides the date of effect of a reduction rate, which is dependent on whether there was a letter that advised of the requirements to provide updated advice and whether those requirements were complied with. If they were not complied with there is a retrospective date of effect. Mr Watkins’ debt has arisen as he has not complied with a 14 day requirement.

9. Mr Watkins’ son has consistently argued that he attended the Prahran Centrelink office with his father in February 2015. In an email of 14 April 2017 to the AAT1 he states:

   Within this Centrelink reviewer outcome, it is obvious to us this flawed decision is heavily dependent upon not being advised within 14 days of any change in the value of my father’s financial investment. We would like to respectfully point out to Centrelink that in February 2015, as a result of correspondence sent to my father requesting an update of his financial detail and mean tested status, we both personally attended the Centrelink branch office in High Street, Prahran.

   We arrived before operation hours (8:30 AM) went in early and explained our situation and objective then sat and waited for an hour and a half before being summoned back to the reception area, only be told there were no staff within the branch who were qualified to deal with mean tested related matters. We were simply asked to call a ‘1300’ number request assistance from the department. Feeling very grieved and dissatisfied after such a long delay and complete waste of time, I took my father back to his room. I then spent over an hour on the phone updating the relevant department staff about my father’s current financial status at the time.

   During numerous and lengthy telephone conversations with several Centrelink staff during December 2016 and January 2017 relating to this alleged debt, and after much repeated explanation by me, two of the departments debt recovery staff have clearly indicated to me that there were indeed departmental computer records of both a visit to the Prahran Centrelink office in February 2015, and my lengthy phone call to them on the same afternoon. One of these hour-long conversation was on my car speakerphone witness by both my father and another friend, so confirmation of these facts can be easily verified.

10. The respondent argued that file notes from Centrelink indicated on 30 March 2015 there was a customer walk-in abandoned by Mr Watkins. It is recorded as: customer did not present from waiting room when called twice at 3:28 PM at the Windsor office.

11. Mr Watkins’ son again disputed this at the hearing and referenced his reasons for appeal:

    In all my correspondence with both Centrelink and AAT, I have clearly stated that I personally took my father to the Windsor Centrelink office in the early morning and arrived before operating hours (8:30 AM. We obviously dispute the above statement and timing for can you please explain this evidently wrong entry and why the Tribunal automatically accepts it as factual?

    Of course we certainly do understand if this confirmation of a seven hour Centrelink waiting time to handle a relatively straightforward means tested enquiry. The only other possible explanation for this entry, is that my elderly 89-year-old (at that time) father with severe dementia, Alzheimer’s disease and depression made an excursion to this Centrelink office by himself on another day, but this is highly unlikely indeed.

12. The respondent contended that Mr Watkins had failed to contact Centrelink within the requisite time and therefore the debt had been duly raised. The respondent at the hearing also pointed out to Mr Watkins’ son that it was his responsibility to ensure that Centrelink was aware of his father’s incapacity and that he had enduring power of attorney over his father’s financial assets and this had not been conveyed to Centrelink.

13. Mr Watkins’ son argued strenuously that his father was not capable of dealing with queries from Centrelink at this stage; that his father had indicated this to Centrelink in January 2015; and they had conveyed this in person when they attend the Windsor branch in March. The respondent indicated that there was no record on file that Mr Watkins’ son had enduring power of attorney for his father and that he was to be the nominated receiver of his father’s communications. Mr Watkins’ son indicated that this had been conveyed to Centrelink in person and over the phone on numerous occasions.

14. Centrelink file notes, dated 12 and 19 August 2016, indicate that Mr Watkins’ pharmacist had called in respect of attempting to dispense medication to Mr Watkins on his concession card but it had been cancelled. Mr Watkins did not understand what he needed to do in order to receive his concession card back. The note states: POA lives overseas and no one else can help him.

15. A Centrelink file note dated 17 November 2016 states:

    I phoned the customer to discuss repayment of new debt that has been raised due to undeclared earnings. I discussed the debt with the customer who stated that he had no knowledge of it and did not understand why the debt had been raised. The customer is quite unwell and is living in aged care. The customer had difficulty understanding the debt and remembering things that have previously been discussed during the conversation. The customer asked why the debt was raised several times. He advised his son normally deals of with his affairs on his behalf although he is living in Cambodia and comes back monthly. His son is due to arrive back in Australia on 1/12/16 and the customer requested that his son speaks with us on this date.

    I advised the customer the debt was due to go to a collection agent before this date but due to his circumstances and his health, I would put the debt on hold until his son was back in the country. I have advised customer that I will phone him back on 1 December 2016 and get his verbal permission for his son to act on his behalf and then can provide me with contact number to speak with his son. No verbal warnings were given as it was not appropriate do to do so due to the customer’s condition.

16. The Tribunal notes the respondent has referred to a letter of 21 July 2014 which advised Mr Watkins of his age care entitlement and routinely requested that: You must tell us within 14 days (28 days if residing outside Australia) if any of the changes listed below happen or are likely to happen to you and/or your partner. Mr Watkins should have indeed informed Centrelink that his circumstances had changed as he had sold the family home in early 2014, leaving it on 22 April 2014 and entering a retirement home. However, the current application is in respect of the letter of 11 March 2016, as it is from this letter that Centrelink has determined to suspend Mr Watkins’ age pension and to determine he has a debt.

1. The Tribunal finds the Mr Watkins had attempted to advise of his change in circumstances prior to the letter of 11 March 2016 but failed to respond within 14 days to the letter dated 11 March 2016, not providing a response until the 28 April 2016.

   Changes in any assets

2. Mr Watkins’ son in his application for review queried the AAT1’s assertion that Centrelink had calculated the debt correctly. He asked:

   Does the Tribunal consider the legitimacy of why this alleged debt was raised in the first place? Is it because the value of the family home being transferred to the obligatory age care bonds, is an excellent opportunity for Centrelink to deviously revise the calculations of my father’s means tested income and assets, so as to create an unjust debt in an underhanded attempt to gain Commonwealth revenue?

3. Mr Watkins advised Centrelink that a bond of $350,000 for the Central Park Aged Care Home had been paid on 22 April 2014, the classic residence in Brighton had sold on 21 January 2015, and an accommodation bond of $206,620 had been paid to Mayflower Brighton.

4. On 28 April 2016 Mr Watkins provided the following advice to Centrelink in respect of his assets:

   (i)bank account 1 balance of $103,084.44

   (ii)bank account 2 balance of $45,406.02

   (iii)sale of classic residence Brighton on 21 January 2015, proceeds in the amount of $431,655.88 deposited into cheque account

   (iv)payment of bond to Mayflower Brighton on 20 November 2015 of $206,602

   (v)cash gift of $200,000 to son on 11 February 2015

5. The respondent argued that Mr Watkins’ income during the relevant period comprised of income from an income stream (superannuation), deemed income from a bank account, shares and a gift. They argued the value of Mr Watkins’ income at the time took him above the allowable limit and he was therefore not entitled to a pension during this period. They recorded Mr Watkins’ annual income at 21 January 2015 as $53,194.70, being comprised of:

   ·$36,010 from an income stream

   ·$17,184.74 income from deemed financial assets totalling $511,564

   (i)bank account 1 balance of $442,516

   (ii)bank account 2 balance of $1,189.50

   (iii)bank account 3 balance $1,877

   (iv)Commonwealth Bank shares valued at $65,982

6. Mr Watkins’ son disputes several of Centrelink’s submissions in respect of his father’s assets, he stated that:

   ·His father had sold his Commonwealth Bank shares for about $20,000 to help with the payment of his medical bills.

   ·Centrelink had become inordinately focussed on his father’s gift to himself to facilitate the overseas education of his one and only granddaughter; he stated school education receipts could be provided.

   ·He later claimed the $200,000 had not come from the sale of the family home but was proceeds from his deceased mother’s estate and that his mother’s estate had been divided between her three sons. Mr Watkins’ lawyer provided a copy of Mrs Watkins’ will to the Tribunal which indicated she had bequeathed her estate to a husband. The lawyer stated it was not the late Mr Watkins’ intention to gift the entitlement to his children but rather renounce any claim to the entitlement and have it passed over to his children. Mr Watkins had not been aware that a formal deed of pronunciation was required to demonstrate this wish to Centrelink.

7. The Tribunal finds that Mr Watkins’ assets having changed over the relevant period impacted his eligibility for the age pension. However it is not satisfied that Centrelink had accurately recorded his actual assets held at that time.

   Writing off the debt

8. The Tribunal, standing in the shoes of the Secretary, has the discretion to write off the debt pursuant to section 1236 of the Act. Alternatively, the Tribunal may waive the right to collect the debt, if it was due solely to administrative error, or there are special circumstances.

9. On the evidence before the Tribunal, Mr Watkins did not meet the criteria as established in section 1236 of the Act and as such, the Tribunal is unable to write off the debt. Obviously, the situation has now changed as the debt has passed to Mr Watkins’ estate. However, there was no evidence before the Tribunal as to the capacity of the estate to repay the debt or to establish if it was not cost effective for the Commonwealth to take action to recover the debt. The Tribunal finds that these matters needed to be assessed by Centrelink before the ability of the Secretary to write of the debt could be determined.

   Waiver of debt on the basis of administrative error

10. The respondent submitted the debt had not arisen as a result of administrative error and consequently section 1237A of the act was not satisfied.

11. Mr Watkins’ son contended that numerous errors had been made in respect of his father’s age pension, as he was adamant that:

    ·they had advised Centrelink of his father’s change in circumstances;

    ·Centrelink had attributed incorrect assets to his father, most particularly his Commonwealth Bank shares and the gift of $200,000;

    ·there was no differential in his father’s assets before his pension was cancelled on 21 January 2015, the only difference being the sale of the house which had been used as a deposit for his age care bond; and

    ·Centrelink had been informed of his father’s mental incapacity and they were well aware of it as his father had presented to Centrelink in person.

12. The Tribunal accepts that Mr Watkins and his son had attempted to clarify his changed in assets in March 2015. This would have clarified with Centrelink the situation of the sale of Mr Watkins’ home, which was the genesis of the file review by Centrelink and which resulted in the failure to respond within 14 days to the letter sent on 11 March 2016. The Tribunal finds that there was a contributing confusion created by Centrelink. However it was not an administrative error.

13. Based on the evidence, the Tribunal finds that the debt did not result solely from an administrative error by Centrelink but as a result of Mr Watkin’s failing to advise Centrelink of a change in his circumstances. In such circumstances, the debt cannot be waived under section 1237A(1) of the Act.

    Waive all or part of the debt in special circumstances

14. Alternatively, the Tribunal, standing in the shoes of the Secretary, has the discretion to waive all or part of Mr Watkins’ debt where special circumstances exist. For the discretion to be exercised, all three conditions contained in subsections (a), (b), and (c) of section 1237AAD must be satisfied(see paragraph 19).

15. The respondent contends there is no evidence to suggest that Mr Watkins’ circumstances are such that they can be considered special, to the extent that waiver of part or all of the debt is warranted under section 1237AAD.

    Knowingly

16. The term ‘knowingly’ has not been defined in the Act, though it has been considered extensively by the Tribunal in similar circumstances.

17. In Re Callaghan and Secretary Department of Social Security [1996] 45 ALD 435, Deputy President Forgie said at [48]:

    There is nothing in section 1237AAD which suggests that the word “knowingly” should be given any meaning other than that a person has actual knowledge rather than constructive knowledge, that he or she is making a false statement or representation that he or she is failing or admitting to comply with a provision of the Act. The actual knowledge is to be ascertained by reference to the statements of the person as to his or her actual state of knowledge at the time and to events surrounding the false statement or the act of omission.

18. The Tribunal finds that Mr Watkins’ debt did not arise because he knowingly made false statements or declarations. The Tribunal finds that Mr Watkins’ did not deliberately act dishonestly and had no intention of misleading Centrelink.

19. In Re Anderson and Secretary, Department of Families and Community Services [2002] 69 ALD 494, the Tribunal stated at [494]:

    “[…] it is open to the tribunal to infer that the applicant has actual knowledge of his obligations under the act where there are opportunities for that knowledge to be gained when there are no obstacles to him acquiring knowledge. In this case, the applicant has had the opportunity to gain an understanding of his obligations under the Act to the provision of advice letters to him from the respondent. The tribunal is not aware of any obstacles that would prevent Mr Anderson from understanding those letters and gaining that knowledge.”

20. The Tribunal finds Mr Watkins has not knowingly or deliberately misled Centrelink and therefore the debt has not arisen solely or partly from his making a false statement or knowingly failing to comply with the legislation. As such, subsection (a) of section 1237AAD of the Act is satisfied.

    Special circumstances

21. The expression “special circumstances” has not been defined in the Act. However, the meaning of “special circumstances” has been considered extensively by the Federal Court and the Tribunal.

22. In Ryde v Sec Department of Family and Community Services [2005] FCA 886, Branson J said at [26]:

    ”[…] the evident purpose of s 1237AAD is to enable a flexible response to the wide range of circumstances which could give rise to hardship or unfairness, the statutory requirement for special circumstances discloses an intention to proscribe waiver in ordinary cases. The hardship or unfairness to which French J referred must be understood to be hardship or unfairness sufficient to justify departure from the general rule in the particular case.”

    In Groth v Secretary Department of Social Security (1995) 40 ALD 541, Kiefel J said at [545]:

    “[…] for present purposes it is sufficient to observe that it requires something to distinguish Mr Groth’s case from others, to take it out of the usual ordinary case. That was, I consider, the only enquiry to be undertaken in this case. It would of course follow if one to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.”

23. Deputy President Humphreys in Re Secretary, Department of Social Services and Hollis [2015] AATA 941 stated:

    ”"[I]n order for the time for making a claim to be extended, the secretary (and in turn the Tribunal) must be satisfied of two things: first, that circumstances existed that were special and, secondly, that those special circumstances prevented the claimant from making a claim within time.”

24. Mr Watkins’ son contends that his father’s situation prior to his death was indeed special, as he was suffering depression as a result of the loss of his wife of 65, years as well as the harassment of Centrelink over this debt. Additionally, his father was incapable of dealing with these issues as he had severe dementia and Alzheimer’s disease, and this was apparent to Centrelink at the time. That issue was complicated by the fact that, as his father’s only competent person of support, he was living and working overseas during this entire period. Additionally, the whole process was erroneous as his father’s assets had not in fact changed. His father had simply sold his home to fund the cost of the compulsory accommodation bond to enter a nursing home and Centerlink had already been made aware of these changes to his father circumstances.

25. In summary, it has been held that for circumstances to constitute “special circumstances” they must be circumstances which are “unusual, uncommon or exceptional,” “markedly different from the usual run of cases”, “special” or “out of the ordinary” and they include “events which would render the strict application of the rule in question unfair or inappropriate.” The Tribunal did not find Mr Walton’s situation constituted “special circumstances” as considered in numerous decisions by the Federal Court and the Tribunal.

    Waiving the debt more appropriate than writing off the debt

26. The Tribunal accepts it is not appropriate to write off the debt and therefore Mr Watkins satisfies this section of the Act.

    CONCLUSION

27. It cannot be said that the debt was attributable solely to administrative error. Consequently section1237A of the Act does not apply in this case.

28. The Tribunal is also not satisfied that the amounts used to calculate Mr Watkins’ assets correlate to his assets at the time. This is highlighted by both the question of the value of Commonwealth Bank shares, and the respondent seeking to set aside the decision of the AAT1 hearing. The respondent sought that the Tribunal set aside the decision of the AAT1 “substituting Mr Watkins has a debt totalling $6,623.39 for the period 21 January 2015 to 19 May 2016” and not debt of $5,701.78 for the same period. This was sought as Centrelink has now determined Mr Watkins was entitled to nil payment, as his assets exceeded the cut off limit for receipt of an age pension in the relevant period.

29. The Tribunal does not find that special circumstances apply in this case. Whilst the Tribunal is very sympathetic to Mr Watkins’ very difficult circumstances in this period, were not “unusual, uncommon or exceptional” for a man of his advanced years.

30. Finally the Tribunal is unaware of Mr Watkins’ estate ability to make the repayment for the debt it has inherited.

    DECISION

31. The Tribunal sets aside the reviewable decision and in substitution determines that Mr Watkins debt should be reviewed and assessed on the basis of his actual assets, his estate’s ability to repay the debt and whether it is cost effective for the Commonwealth to do so.

I certify that the preceding 61(sixty-one) paragraphs are a true copy of the written reasons for the decision of Ms Anna Burke, Member

...............................[sgd].........................................
Associate

Dated: 20 November 2018

Date of hearing:	15 August 2018
Applicant:	Mr Peter Watkins, son of applicant
Advocate for the Respondent:	Mr Alisa Bramley Government Lawyer FOI and Litigation Branch