Wayne and Repatriation Commission

[2006] AATA 164

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 164

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2005/977

VETERANS’ APPEALS DIVISION		)
Re		BRENDA WAYNE

Applicant

And REPATRIATION COMMISSION

Respondent

DECISION

Tribunal Dr J D Campbell, Member

Date24 February 2006

PlaceSydney

Decision The decision under review is affirmed.

[Sgd] Dr J D Campbell   Member

CATCHWORDS

VETERANS' AFFAIRS - special residence - special resident - entry contribution - extra allowable amount - property owner - rent assistance - financial hardship – decision under review affirmed

Veterans' Entitlements Act 1986 sections 5MC, 5N, 52M, 52N, 52R, 52Y

REASONS FOR DECISION

24 February 2006   Dr J D Campbell, Member

1.      Mrs Wayne is an elderly widow who has been living in the Goulburn Masonic Retirement Village since April 2003.  When Mrs Wayne entered the Retirement Village, she paid a total entry contribution amount of $110,000, which she believed purchased her a license to occupy the premises pursuant to a nominated agreement. In addition to the total entry contribution amount, Mrs Wayne pays a fortnightly maintenance fee which was $55, at the time of entry, and is now $67; further increases will occur over time.

2.      Mrs Wayne applied to the Repatriation Commission for rent assistance. However the Repatriation Commission decided that Mrs Wayne is not entitled to rent assistance as she is a property owner.

3.      Mrs Wayne contended that as she was issued a license to occupy she is not a property owner.  In addition she submitted that the capital entry amount decreased by 2.5% in value each year until the amount reached $80,000, at which time there is no further reduction.  She submitted that this is incongruent with the general expectation that there will over time be an accrual of increased value in such a residential asset. Finally Mrs Wayne contended that the fortnightly maintenance payment was essentially a fortnightly rent payment.

issues

4.      The main issue to decide in this matter is whether Mrs Wayne is entitled to rent assistance.  In deciding this, I must address the following:

(a)What was the contribution amount paid by Mrs Wayne to secure entry to the Retirement Village in the first half of 2005?

(b)Was the contribution amount paid by Mrs Wayne in excess of the extra allowable amount, such an amount being the amount permitted at the time of entry?

(c)If the amount was in excess of the extra allowable amount, what is the consequence?

consideration and findings

entry contribution

5.      There is no disagreement between the parties that Mrs Wayne paid an amount of $110,000 on entry to permit her residence at the Retirement Village. I so find.

6.      Mrs Wayne is a special resident pursuant to section 5MC of the Veterans’ Entitlement Act 1986 (“the Act”) as she is living in a retirement village which is a special residence under the Act.

7.      Section 52M of the Act defines a special resident’s entry contribution as the resident’s individual residence contribution. Mrs Wayne’s individual residence contribution is $110,000.

extra allowable amount

Section 52N(2) of the Act provides that if residence is taken up in a retirement village after 12 June 1989, the resident’s extra allowable amount for a widow is:

“(2)(a)the amount that, as at the time when the person becomes entitled to take up that residence, is the difference between the single property owner AVL and the single non-property owner AVL [Asset Value Limi]”

At the time in questions these two values were $249,750 and $145,250, with the difference between the two being $104,500.

8.      Taking into consideration the contribution entry fee of $110,000 and an extra allowable amount of $104,500, I conclude that the contribution entry fee exceeds the extra allowable amount.

what is the consequence

9.      Section 52Q of the Act provides that where the entry contribution made by a special resident is greater than the extra allowable amount (considered alone), the special resident is be taken to be a property owner.

10.     As a consequence, for the purposes of the Act Mrs Wayne is a property owner in relation to the residence maintained within the Retirement Village. In such circumstances, Mrs Wayne is not eligible to receive rent assistance.

financial hardship

11.     Section 52Y of the Act details the circumstances under which access can be made to financial hardship rules and the circumstances which must exist for consideration to be given. I note in this matter that such an issue is not properly before me as no primary decision has been made. I intend to take the matter no further other than to comment that Mrs Wayne’s financial circumstances indicate no evidence of severe financial hardship, with indeed her moderate financial circumstances being well managed essentially by herself.

summary

12.     Mrs Wayne’s application for rent assistance must fail. I so find, and in so doing affirm the decision under review.

I certify that the 12 preceding paragraphs are a true copy of the reasons for the decision herein of Dr J. D. Campbell, Member

Signed: A, Krilis
  Associate

Date/s of Hearing  27 January 2006
Date of Decision  24 February 2006
Representative for the Applicant    Self
Advocate for the Respondent        Mr Nigel Bunn