Whiting and Secretary, Department of Families, Community Services and Indigenous Affairs and Anor
[2007] AATA 1838
•5 October 2007
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2007] AATA 1838
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q 200700054
GENERAL ADMINISTRATIVE DIVISION ) Re DEBBIE WHITING Applicant
And
SECRETARY, DEPARTMENT OF FAMILIES, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS
Respondent
DECISION
Tribunal Dr KS Levy, RFD, Senior Member Date5 October 2007
PlaceBrisbane
Decision The Tribunal affirms the decision under review.
...................[Sgd]...........................
Senior Member
CATCHWORDS
SOCIAL SECURITY – parenting payment – family tax benefit – debt raised – overpayment – applicant was living in a marriage-like relationship – debt cannot be written off or waived – decision affirmed
Social Security Act 1991 (Cth) ss 4, 1068A, 1068B, 1236, 1237, 1237A, 1237AAD
A New Tax System (Family Assistance) (Administration) Act 1999 (Cth) ss 95, 96, 97, 101
Pelka v Secretary, Department of Family and Community Services (2006) 151 FCR 546
Re Roberts and Secretary, Department of Social Security (1987) 12 ALD 723
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Dranichnikov v Centrelink (2003) 75 ALD 134REASONS FOR DECISION
5 October 2007 Dr KS Levy, RFD, Senior Member Introduction
1. The applicant, Ms Debbie Whiting, following a marriage breakdown, formed a relationship with Mr Richard Dunham. This commenced in about 2001 and over the following 12 months she rented properties and had some financial arrangements jointly with Mr Dunham. Ms Whiting also applied for and was granted a parenting payment single on 24 September 2002. She also obtained family tax benefit from about that time. In the ensuing two years, there was evidence of Ms Whiting’s relationship with Mr Dunham being cemented in a number of respects. She and Mr Dunham subsequently had a daughter together.
2. Following an investigation by Centrelink into Ms Whiting’s living arrangements and entitlements, a debt in respect of parenting payments was raised for a period covering the financial years from 2001/2002 to 2004/2005. Debts in relation to family tax benefit payments were also raised for the same financial years. Ms Whiting sought a review of those decisions and an Authorised Review Officer (ARO) maintained that certain debts were due and owing by Ms Whiting although the commencement date of her being “a member of a couple” was varied from the original decision. Likewise, the ARO varied the amounts of debt in respect of family tax benefit and parenting payment.
3. The ARO determined debts as follows:
(a) a parenting payment debt of $21,456.82 for the period 7 December 2002 to 5 April 2005; and
(b) family tax benefit debts of $1,116.52 for the 2002/03 year and $2,042.28 for the 2003/04 year.
4. Ms Whiting then appealed to the Social Security Appeals Tribunal (SSAT) but on 21 December 2006 that Tribunal affirmed the ARO’s decision. She now appeals to this Tribunal.
Issues
5.The issues in this case are to determine:
(i)The commencement date of Ms Whiting becoming “a member of a couple” with Mr Richard Dunham.
(ii)Whether a parenting payment debt of $21,456.82 was properly raised and is recoverable for the period covering tax years 2002/03 to 2004/05.
(iii)Whether the family tax benefit debts of $1,116.52 for 2002/03 year and $2,042.28 for the 2003/04 year are due and recoverable?
Evidence
6. The Tribunal had a number of documents available to it. In particular, the T documents (Exhibit 1); the S documents (Exhibit 2); and a group of Centrelink file notes dated 13 September 2004 (Exhibit 3).
7. No witnesses were called. Ms Whiting was self-represented, while the respondent was represented by Mr Rick McQuinlan.
8. Ms Whiting gave oral evidence, initially in the form of a statement. She referred to the fact that after her divorce, she and her three children (from her former marriage) were living together and the children saw their father every second weekend. During these weekend periods she and Richard Dunham spent time together. When it was apparent to her and her children that her former husband had a new partner, she then introduced Mr Dunham to her children, although, at least in the early stages Mr Dunham did not sleep at her house while her children were there. Ms Whiting stated that it was not until December 2002 when the children were away with their father at Christmas time, that Mr Dunham stayed with her for a lengthier period. On one occasion when the children returned home earlier than expected, they found her and Mr Dunham at home in bed. After a discussion with her children, Mr Dunham was assimilated into their family life. She stated that she and Mr Dunham were then engaged on 10 September 2004. Their daughter was born on 14 September 2005.
9. As part of this Centrelink investigation, Ms Whiting completed an “Assessment of Living Arrangements” form (T23 folio 142 – 148). She described there, that Mr Dunham was a “live in lover” but stated that he did not contribute to any household expenses. In a telephone interview on 25 May 2005, she admitted that she was living in a de facto relationship with Mr Dunham and had been living in that arrangement for some 18 months. She was also six months pregnant to Mr Dunham at that time.
10. The circumstances were that she had rented properties since January 2002 and in some cases, they were rented together with Mr Dunham. They had two joint bank accounts together. Ms Whiting had made a will nominating Mr Dunham as the beneficiary under her will. Ms Whiting stated that she was to have surgery about that time and trusted Mr Dunham, and she wanted to ensure that someone would be able to care for her children financially if she passed away before they were adults. Mr Dunham had nominated Ms Whiting as a beneficiary of his superannuation fund from 26 July 2002.
11. Ms Whiting had a number of positions with the Greenbank RSL, some of which were casual, some were permanent part-time and then later she held a full-time permanent position there. She stated that she had advised Centrelink of those arrangements and also provided oral evidence that she advised Centrelink on 28 April 2004 that she had a change of employment status and also that Mr Dunham and she were then living together. Centrelink has a record of her reporting on that date, but there was no reference in the Centrelink records that Mr Dunham was now cohabiting with the applicant. She also maintained that she had forwarded copies of her employment contracts to the Beaudesert branch of Centrelink, although these could not be found at Centrelink.
12. Ms Whiting stated that she felt that she was liable for a debt from February 2004 to April 2005, as she said February 2004 was when Mr Dunham moved in and was living with her on a permanent basis.
13. In cross-examination, Mr McQuinlan took Ms Whiting to a number of records which showed that she had stated to real estate agents or others that she was living with Mr Dunham or that he was her “partner” or “live in lover”. She also said that Mr Dunham did not provide any financial support to her or her children at that time as most of his income went in debts to his former wife. She also said that their joint bank accounts were not indicative of a normal marriage-like relationship.
Consideration
14.I have considered all of the factual evidence and the statutory and case law relevant to this matter.
15.I make the following findings of fact:
(i)There were a number of inconsistencies in Ms Whiting’s oral evidence compared with the documentary evidence available.
(ii)Ms Whiting and Mr Dunham had joint bank accounts at least since 18 January 2002. There was also evidence of Mr Dunham’s wages being deposited to one of the joint accounts, and that the rental property in which Ms Whiting and her children resided, was paid from the account in which Mr Dunham’s wages were credited.
(iii)Mr Dunham advised his superannuation fund on 10 July 2002 that he was residing at the address which was also Ms Whiting’s address and that he advised this same address to his employer in September 2002, when advising of the bank account for crediting of his pay. Ms Whiting was also a joint operator of this account.
(iv)Ms Whiting and Mr Dunham had been residing together at least from September 2002, whether full time or not, and Ms Whiting referred to Mr Dunham variably as her “partner” or her “live in lover”.
(v)Ms Whiting executed a will nominating Mr Dunham as her beneficiary (T23 folio 145).
(vi)Mr Dunham nominated Ms Whiting as the beneficiary of his superannuation fund with the Transport Worker’s Fund at least since 26 July 2002.
(vii)Ms Whiting and Mr Dunham have a child Samantha, who was born on 14 September 2005.
16. The legislation which is relevant to determine the issues before the Tribunal relate to the authority for the payment of various rates of parenting payment (s 1068A and 1068B of the Social Security Act 1991 (the Act). The question of whether Ms Whiting was a member of a couple at any particular date with Mr Richard Dunham is determined by whether there is a “marriage-like relationship”.
17. Section 4(2)(b)(i) provides that a person will be a member of a couple where that person “….has a relationship with a person of the opposite sex”. Also, the relationship must be shown to be, in the opinion of the Secretary of the Department, “a marriage-like relationship” (s 4(2)(b)(iii)).
18. In making a determination about whether there is a “marriage-like relationship”, the Tribunal must have regard to the following circumstances set out in s 4(3):
“(3) In forming an opinion about the relationship between 2 people for the purposes of paragraph (2)(a) or subparagraph (2)(b)(iii), the Secretary is to have regard to all the circumstances of the relationship including, in particular, the following matters:
(a) the financial aspects of the relationship, including:
(i) any joint ownership of real estate or other major assets and any joint liabilities; and
(ii) any significant pooling of financial resources especially in relation to major financial commitments; and
(iii) any legal obligations owed by one person in respect of the other person; and
(iv) the basis of any sharing of day‑to‑day household expenses;
(b) the nature of the household, including:
(i) any joint responsibility for providing care or support of children; and
(ii) the living arrangements of the people; and
(iii) the basis on which responsibility for housework is distributed;
(c) the social aspects of the relationship, including:
(i) whether the people hold themselves out as married to each other; and
(ii) the assessment of friends and regular associates of the people about the nature of their relationship; and
(iii) the basis on which the people make plans for, or engage in, joint social activities;
(d) any sexual relationship between the people;
(e) the nature of the people's commitment to each other, including:
(i) the length of the relationship; and
(ii) the nature of any companionship and emotional support that the people provide to each other; and
(iii) whether the people consider that the relationship is likely to continue indefinitely; and
(iv) whether the people see their relationship as a marriage‑like relationship.”
19. In assessing the above provisions against the evidence available, they are not exhaustive. This conveys the notion that none of the criteria in isolation can be determinative of whether there is a marriage-like relationship in existence, but that conclusion must be formed after considering the “total picture of the relationship” (Pelka v Secretary, Department of Family and Community Services (2006) 151 FCR 546 per French J).
20. In relation to the financial aspects of the relationship, there was oral evidence by Ms Whiting that there was no financial support by Mr Dunham, at least not before March or April 2004 when she maintained that Mr Dunham formally moved in to live with her. There was however, contradictory evidence. Ms Whiting stated that she had advised Centrelink of this on 28 April 2004 and provided record of a receipt number 1159 and the time of a telephone call advising Centrelink as being 11.39am. Evidence was presented to show that Centrelink had a record of such a phone call but there was not a record that she had advised of him moving in at that date. Ms Whiting also said that she had provided copies of two of her employment contracts but there was no evidence of this to be found at Centrelink.
21. There was evidence that there was an account with Credit Union Australia and also an account with the Westpac Bank where Ms Whiting and Mr Dunham operated joint bank accounts, at least since 18 January 2002. Mr Dunham’s employer provided evidence of his direction to pay his wages into one of those joint bank accounts (Exhibit 2, S1, Folios 8-9). The joint bank account with CUA was used to pay rent on the house rented by Ms Whiting. Her evidence was at times a little glib and she appeared to give “convenient” answers. While there may have been occasions when Mr Dunham was not residing with her, I formed the view that she was not a witness where strong reliance might be placed on all of the detail she provided. Therefore, her evidence lacked some credibility, as the factual evidence was unequivocal about the commencement of some joint living arrangement and that there was a pooling of resources by both Ms Whiting and Mr Dunham from 18 January 2002.
22. The nature of the household is not altogether clear from early 2002. There was clearly a relationship between both parties, including a sexual relationship. She refers to Mr Dunham as her “live in lover”. This is not of itself sufficient to indicate that there is a “marriage-like relationship” and Ms Whiting indicated that she concealed this from her children until, on one occasion, it became undeniable. She endeavoured then to have Mr Dunham accepted by her children, which she said was achieved successfully.
23. There was no specific evidence either for or against indicating an active role in the household by Mr Dunham. This may have been because of the ages of the children and a lack of attachment by either him or Ms Whiting’s children. No conclusion is formed about this aspect. But, it is clear that he did spend some occasions with Ms Whiting although evidence suggests that he had no fixed place of residence during that time. Mr Dunham did not give evidence and so the evidence in respect of those facts is not necessarily of strong weight. However, it is also clear that he had a financial commitment to the household at least at that time, as he had informed his superannuation fund that his residential address was the same as that of Ms Whiting, at least from 10 July 2002. That is not easily reconcilable with her evidence that Mr Dunham had no fixed place of residence. The evidence of the change of address must be considered when somewhat contemporaneously, Mr Dunham advised his employer to pay his net wages to an account held jointly with Ms Whiting.
24. In terms of the social aspect of their relationship, the questionnaire completed by Ms Whiting on 27 April 2005 clearly points to their living together from December 2002 (see question 4, Exhibit 1, folio 143). It is this document where she also refers to Mr Dunham as her “live in lover” (see Exhibit 1, folio 148).
25. In the interview dated 25 May 2005, she admitted that she had been living in a de facto relationship with Mr Dunham for at least 18 months at that time. She said that she had not advised Centrelink as her accountant told her that it was “all right”. The evidence shows that she now resiles from that statement, (T32, folio 203). This evidence impliedly points to a social aspect of the relationship although the evidence in that respect is not necessarily strong in a direct sense.
26. The sexual relationship between the applicant and Mr Dunham has been overtly expressed in documentary evidence. Ms Whiting has not denied that this aspect of her relationship existed from very early in the period under review and appears to have commenced in about 2001. It was clearly part of their relationship in 2002 and since that time. She explained the circumstances in which her children found her and Mr Dunham together at home. The sexual relationship would appear to have continued unabated. By the end of 2005 they had a daughter together.
27. The nature of the commitment of Ms Whiting and Mr Dunham to each other is probably where there is room for little conjecture. It is clear there has been a pooling of financial resources and a sexual relationship, together with a commitment to rent premises in joint names. This was paid for from their joint bank accounts. Ms Whiting said this should just be seen in the context that they were “boyfriend – girlfriend”. She also said that it could not be regarded as a “marriage-like relationship”. But that assessment could not be regarded as being that of an objective, reasonable person viewing the facts as presented (Re Roberts and Secretary, Department of Social Security (1987) 12 ALD 723). The commitments outlined above are bolstered by the evidence that Ms Whiting is the beneficiary under a will and also under life insurance policies (see T23, folio 145 – question 23 of her questionnaire “Assessment of Living Arrangements”). In addition, she has been nominated as the beneficiary of Mr Dunham’s superannuation fund since 26 July 2002.
28. Ms Whiting referred to a logical desire to ensure that her children would be looked after should something have happened to her, before her children reached the age of majority. However, it is clear that is not the sole or dominant reason for all of her living arrangements. There has been a strong emotional attachment between Ms Whiting and Mr Dunham. They have also shared bank accounts and shared rental premises together. They have become beneficiaries of each other’s assets for the future and a level of trust has been shown which one expects could only have been intended to be for a long term commitment. But critically, the documentary evidence points to that commitment having commenced at least in the middle of 2002. That description belies the “total picture” of the relationship which continued from at least the middle of 2002 until when Ms Whiting became pregnant and ultimately gave birth to their daughter. I find therefore that there was a marriage-like relationship at least from July 2002, and the ARO’s determination that that relationship commenced on 7 December 2002 appears to be a generous assessment. I affirm the decisions of the ARO and the SSAT that Ms Whiting became a ‘member of a couple’ on 7 December 2002. On that basis, the debts assessed for the financial years 2002/03 to 2004/05 are justified.
Should these debts be Recovered?
29.There are two debts involved in the decision by the ARO on 7 January 2006:
(i)A parenting payment debt of $21,456.82; and
(ii)A family tax benefit debt of $1,116.52 (for 2002/03 year) and $2,042.28 (for 2003/04).
30. Recovery of the parenting payment debt is authorised by the Social Security Act 1991. Recovery of the family tax benefit debt is authorised by A New Tax System (Family Assistance) (Administration) Act 1999. These statutory provisions provide for options of write-off of the debts, or waiver.
·Write Off
31.The relevant statutory provisions are:
Section 1236(1A) of the Social Security Act 1991 provides:
1236 Secretary may write off debt
“1236(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.
32.Section 1236(1C) of the Social Security Act 1991 provides:
“1236(1C) For the purposes of paragraph (1A)(b), if a debt is recoverable by means of:
(a)deductions from the debtor's social security payment; or
(b) deductions under section 84 of the A New Tax System (Family Assistance) (Administration) Act 1999; or
(c)setting off under section 84A of that Act;
the debtor is taken to have a capacity to repay the debt unless recovery by those means would result in the debtor being in severe financial hardship.”
33.Section 95 of the A New Tax System (Family Assistance) (Administration) Act 1999 provides:
“Sect 95
Secretary may write off debt
(1) The Secretary may, on behalf of the Commonwealth, decide to write off a debt for a stated period or otherwise, but only if subsection (2), (4A) or (4B) applies.
Secretary may write off debt if debt irrecoverable or debt will not be repaid etc.
(2) The Secretary may decide to write off a debt under subsection (1) 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.
34. In order to be able to take advantage of these provisions, an applicant must show that he or she has no capacity to repay the existing debt. It is generally regarded that repayment of a debt by way of a deduction from Social Security payments is a legitimate method of repayment and therefore, it could not be regarded that Ms Whiting has no capacity to repay the debt. In the circumstances, I find that these provisions are of no assistance to Ms Whiting.
· Waiver
35.Section 1237 of the Social Security Act 1991 provides:
“1237 Power to waive Commonwealth's right to recover debt
Secretary's limited power to waive
1237(1) On behalf of the Commonwealth, the Secretary may waive the Commonwealth's right to recover the whole or a part of a debt from a debtor only in the circumstances described in section 1237A, 1237AA, 1237AAA, 1237AAB, 1237AAC or 1237AAD and, if the debt is an assurance of support debt, subject to section 1237AAE.
When waiver takes effect
1237(2) A waiver takes effect:
(a)on the day specified in the waiver (whether that day is before, after or on the day on which the decision to waive is made); or
(b)if the waiver does not specify when it takes effect–on the day on which the decision to waive is made.”
36.Section 96 of A New Tax System (Family Assistance) (Administration) Act 1999 provides:
“Sect 96
Power to waive Commonwealth's right to recover debt
(1) On behalf of the Commonwealth, the Secretary may waive the Commonwealth's right to recover the whole or a part of a debt from a debtor only in the circumstances described in section 97, 98, 99, 100, 101 or 102.
(2) A waiver takes effect:
(a) on the day specified in the waiver (whether that day is before, after or on the day on which the decision to waive is made); or
(b) if the waiver does not specify when it takes effect--on the day on which the decision to waive is made.”
37. It is apparent that waiver can assist the applicant where he or she can demonstrate that the overpayment is due to the sole administrative error of the Commonwealth and that any overpayments received, have been received in good faith (s 1237A(1) of the Social Security Act 1991 and s 97 of A New Tax System (Family Assistance) (Administration) Act 1999. I have found that this debt arose because of circumstances pertaining to the applicant and that some of her evidence is not entirely credible. It cannot therefore be said the debt arose solely from an administrative error, and in any event there must therefore be questions about whether the overpayments were received wholly in good faith. I therefore find that waiver on the grounds of administrative error is not justifiable and that these overpayments could not be said to have been received in good faith.
38. The other circumstance in which an applicant might seek relief is where it can be shown that there are “special circumstances”. This provision is contained in s 1237AAD of the Social Security Act 1991 and s 101 of the A New Tax System (Family Assistance) (Administration) Act 1999. “Special circumstances” is not statutorily defined but has been held to require demonstration of circumstances which are “unusual, uncommon or exceptional”. There must be something to show that those circumstances are “different from the usual run of cases” (Re Beadle and Director-General of Social Security (1984) 6 ALD 1 at 3) or it must be shown the “…circumstances are such that takes the case out of the ordinary ….” (Dranichnikov v Centrelink (2003) 75 ALD 134 at 148). The facts of this case have not demonstrated any aspect which could be regarded as unusual or out of the ordinary. There are no special or unusual or mitigating circumstances which put this case significantly apart from other cases seeking relief under these provisions. Repayment of the debt undoubtedly creates some hardship or inconvenience for any applicant, but I can find no legal basis for the granting of any relief which would obviate the legal obligation to repay the debts raised in this case.
39.I therefore find that the decision under review must be affirmed.
I certify that the 39 preceding paragraphs are a true copy of the reasons for the decision herein of Dr KS Levy, RFD, Senior Member
Signed: .....................................................................................
F. Kamst, Legal Research OfficerDate/s of Hearing 24 August 2007
Date of Decision 5 October 2007
The Applicant was self-represented
For the Respondent Mr R McQuinlan, Departmental Advocate
0
2
0