Wright and Secretary, Department of Families, Community Services and Indigenous Affairs

[2007] AATA 1297

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1297

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No A2006/242

GENERAL ADMINISTRATIVE  DIVISION		)
Re		DAVID WRIGHT

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Mr S. Webb, Member

Date16 March 2007

PlaceCanberra

Decision The decision under review is affirmed.

..............................................

Mr S. Webb, Member

CATCHWORDS

SOCIAL SECURITY - Carer allowance – Death of care recipient prior to determination to grant allowance – Administrative error – Failure to read notices – Payments not received in good faith – No special circumstances – Decision affirmed.

Social Security Act 1991 (Cth) ss 954, 1223, 1237A, 1237AAD

Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 136; [2003] FCAFC 190

Gerhardt v Department of Employment, Education and Training [1997] FCA 815

Secretary, Department of Employment, Education, Training and Youth Affairs v Prince (1997) 152 ALR 127

Jazazievska v Secretary, Department of Family and Community Services (2000) 65 ALD 424; [2000] FCA 1484

Dranichnikov v Centrelink (2003) 75 ALD 134; [2003] FCAFC 133

Beadle v Directory-General of Social Security (1985) 60 ALR 225

Groth v Secretary, Department of Social Security (1995) 40 ALD 541

REASONS FOR DECISION

16 March 2007 Mr S. Webb, Member         

1.      David Wright claimed carer allowance when he was caring for his father, who died before the allowance was granted and paid.  Subsequently the allowance payments were stopped and an overpayment debt was raised against Mr Wright.  Recovery action commenced.  Mr Wright disputes that he should have to repay the debt and challenges the decision of an authorised review officer to that effect, as affirmed by the Social Security Appeals Tribunal.

2.      The issues for determination are

(a)Is Mr Wright liable for an overpayment debt to the Commonwealth in respect of carer allowance payments from 17 November 2004 to 13 June 2006; and if so

(b)Are there grounds that make it appropriate to write-off or waive the Commonwealth’s right to recover the debt?

is mr wright liable for an overpayment debt to the commonwealth in respect of carer allowance payments from 17 november 2004 to 13 june 2006?

3.      Having heard Mr Wright, it appears to me that he does not dispute that he was overpaid carer allowance.  Nor does he dispute the amount of the overpayment.  He contends that he should not have to repay the overpayment, because it was not his fault and only arose as a result of Centrelink error.  I will return to that point below.  In Mr Wright’s submission he attended the Brunswick Centrelink office and notified of his father’s death on 10 November 2004.

4. The qualification criteria for carer allowance are set out at section 954 of the Social Security Act 1991 (Cth). Essentially the person receiving care must be alive. If a person receives a social security payment to which they were not entitled the amount paid is a debt to the Commonwealth.[1]

[1] Subsection 1223(1).

5.      Mr Wright claimed carer allowance in relation to his father on 7 October 2004.  His father died on 10 November 2004.  Mr Wright strongly asserts that he informed Centrelink of this occurrence on that day.[2]  Nevertheless, the decision to grant the allowance was made on 17 November 2004.  On that day Mr Wright was notified of the grant and of his obligations to notify the respondent Secretary, relevantly, if his father died.[3]  Carer allowance was paid from 5 October 2004.

[2] Documents filed pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth), T9 folio 65.

[3] T10.

6.      I am satisfied that Mr Wright was not qualified for carer allowance from the date of his father’s death.  The Secretary contended that the overpayment debt period commenced on 17 November 2004 as Mr Wright had not been notified of his notification obligations in respect of carer allowance until that date.  That will be so if subs 1223(1AD) of the Act as it stood at the time concerning administrative error applies. 

7.      Mr Wright maintains that he attended Centrelink on 10 November 2004 and informed a Centrelink officer ‘Neil’ that his father had died.  Mr Wright says that ‘Neil’ told him that his carer allowance would be cancelled.  ‘Neil’ was not called to give evidence to explain the computer file note he recorded on that day in relation to Mr Wright’s attendance: “What Enq was about: . Entitlement amount . Where is my payment?”.[4]  The particular payment being referred to is not clear.  It is possible that it was carer allowance, however it is also possible that it was disability support pension or some other payment type, rent assistance for example.  In any event ‘Neil’ did not cancel Mr Wright’s carer allowance.  While there is no independent verification of Mr Wright’s account, and giving him the benefit of the doubt, I am prepared to proceed on the basis that Centrelink erroneously failed to cancel his carer allowance.

[4] T9.

8.      Mr Wright continued to receive carer allowance payments by direct deposit into his bank account until 13 June 2006.  Thus the overpayment debt period is from 17 November 2004 to 13 June 2006.  I have not recalculated the precise amount of carer allowance that was paid to Mr Wright during this period.  As Mr Wright is not contesting the amount paid I am prepared to proceed on the basis that the amount calculated by the authorised review officer and accepted by the Social Security Appeals Tribunal is the correct amount: $3,807.95.  That amount is a debt due to the Commonwealth for which Mr Wright is liable.

are there grounds that make it appropriate to write-off or waive the commonwealth’s right to recover the debt?

9.      Mr Wright asserts that he should not have to repay the debt because it only arose as a result of Centrelink’s error.

10.     As will appear I do not agree.

11.     The Secretary must waive the Commonwealth’s right to recover that proportion of a debt that is attributable solely to Commonwealth error if the payments were received by the debtor in good faith.[5]  A debt will be solely attributable to Commonwealth error if the only cause that objectively can be ascribed to the relevant debt is an administrative error.[6] 

[5] Subsection 1237A(1).

[6] See Nicholson J in Sekhon v Secretary, Department of Family and Community Services [2003] FCAFC 190 at paragraphs 35 to 43; Gerhardt v Department of Employment, Education and Training [1997] FCA 815.

12.     The Secretary contends that Mr Wright’s failure to respond to notices he was given in relation to carer allowance, in effect, contributed to his debt.  As noted, Mr Wright asserts that he notified Centrelink of his father’s death before carer allowance was granted and before he received any notice setting out his obligations in relation to that allowance.  Thus, if Mr Wright is correct, he complied with his obligations before being formally notified about their particularity and, thereafter, nothing had changed and his father did not die again.  Proceeding on that basis it does not follow that Mr Wright failed to comply with his notification obligations in relation to carer allowance after 17 November 2005.  Thus his actions in relation to notices did not contribute to his debt.  However, as will appear, the matter does not resolve on this point.

13.     Even if a debt is solely attributable to Commonwealth error the obligation to waive recovery is only mandated under subs 1237A(1) if the payment was received in good faith.  The term ‘received in good faith’ is given purpose by the statutory context in which it is placed.  In this case, the term is concerned with the state of mind of the debtor at the time the particular payment or payments were received.  If the debtor knew or had reason to know that he was not entitled to the payments he received then it cannot be said that the payments were received in good faith.[7]

[7] See Secretary, Department of Employment, Education, Training and Youth Affairs v Prince (1997) 152 ALR 127 at 130.

14.     Having heard Mr Wright’s evidence I am reasonably satisfied that he knew or had reason to know that he was not entitled to the carer allowance payments he received following the death of his father.  Mr Wright’s evidence was that he knew he was not entitled to carer allowance following the death of his father, but he did not know he was being paid carer allowance thereafter.  In his submission he relied on Centrelink to cancel the allowance.  Furthermore, he did not read letters he received from Centrelink, but kept them in a box, and he did not check his bank account statements.  Mr Wright maintained that he received varying amounts of money from Centrelink and he would not have been able to differentiate carer allowance payments in any event. 

15.     I am satisfied Mr Wright received the payments when they were deposited into his bank account and were his to use as he saw fit.[8]  By his own account Mr Wright knew he was not entitled to carer allowance payments following his father’s death.  I am not persuaded by his submissions that he was not aware he was receiving carer allowance following the events of 10 November 2004 (and the information he was purportedly given by ‘Neil’ on that day).  The fact is carer allowance was paid after 17 November 2004.  The first payment included back payment to 5 October 2004.  I accept that it may have been difficult for Mr Wright to differentiate the specific amounts of particular payment types, disability support pension as distinct from carer allowance for example.  However, I do not accept that for a person in Mr Wright’s circumstances, where he was and remains, substantially dependent upon disability support pension for his income, he would not have noticed that his Centrelink payments increased after 17 November 2004 and remained at a higher level than previously applied.  In the circumstances it is difficult to accept that Mr Wright did not harbour a suspicion, at least, that he was receiving payments in error. 

[8] Jazazievska v Secretary, Department of Family and Community Services [2000] FCA 1484 at paragraph 40.

16.     In any event, Mr Wright was informed by Centrelink notices on 17 November 2004 and 15 February 2005 that he was being paid carer allowance.[9]  Mr Wright asserted that he did not read these notices and relied upon his brother to do so subsequently when the debt was raised against him.  However, it was Mr Wright’s responsibility to read the letters he received from Centrelink, at least to confirm that he was being paid benefits to which he was entitled and to ensure compliance with any obligations attaching thereto.  Had Mr Wright read the letters in question he would have known, because it was plainly stated there, that he was being paid amounts of carer allowance.  Mr Wright may have difficulty reading as he claimed, but he did not have difficulty reading documents during the hearing and was observed to possess reading glasses which he used for that purpose.  Thus, I am satisfied Mr Wright had reason to know he was receiving carer allowance and cannot be found to have received those payments from 17 November 2004 to 13 June 2006  in good faith.

[9] T10 and T12.

17.     It follows therefore that the obligation to waive the Commonwealth’s right to recover the debt from Mr Wright pursuant to subs 1237A(1) is not made out.

18.     Finally, Mr Wright’s circumstances must be carefully assessed to determine whether they are such to render it appropriate to write-off or waive the Commonwealth’s right to recover the debt pursuant to subs 1236(1) or 1237AAD(1).

19.     I am satisfied that there are no sufficient grounds to write-off Mr Wright’s debt pursuant to subs 1236(1) of the Act.

20.     With regard to ‘special circumstances’ pursuant to subs 1237AAD(1) of the Act,  Mr Wright gave evidence concerning his health, familial, financial and other circumstances.  I accept that Mr Wright faces certain health problems and difficulties in his life as a result of his disabilities and impairments.  It is for that reason he receives a disability support pension.  I also accept that he is in financially straitened circumstances, being substantially reliant for his income on the Centrelink payments he receives.  His evidence was that he has difficulty paying for medications and relies on his brother for financial assistance from time to time.  However, he also gave evidence concerning his activities in relation to supplying vehicle parts, in the course of which he manages amounts of money through his bank account.  It is not clear on the evidence whether those activities are productive of income for Mr Wright, but that inference lies open.  For circumstances to be considered ‘special circumstances’ there must be something to take the case out of the ordinary.[10]  One could look to circumstances that are unusual, uncommon or exceptional,[11] or that point to something unfair, unintended or unjust occurring as a result of the strict application of the applicable provisions.[12]  No such circumstances exist in this case.

[10] Dranichnikov v Centrelink [2003] FCAFC 133 at paragraph 66.

[11] Beadle v Directory-General of Social Security (1985) 60 ALR 225.

[12] Groth v Secretary, Department of Social Security (1995) 40 ALD 541 at 545.

21.     I am satisfied that the circumstances in Mr Wright’s case are not out of the ordinary.  There is nothing that renders the circumstances special whereby it would be appropriate to waive the Commonwealth’s right to recover the debt for which he is liable.  As I understand it the debt is being recovered from Mr Wright by deduction from his Centrelink payments.  If the level of the deduction causes Mr Wright difficulty it is open to him to negotiate a more appropriate rate of recovery with Centrelink.

22.     It follows that the decision under review is affirmed.

I certify that the 22 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member.

Signed:         .....................................................................................
  Joe Meagher, Associate

Date/s of Hearing  22 February 2007

Date of Decision  16 March 2007
Representative for the Applicant     Self
Solicitor for the Respondent            Centrelink Legal Services Branch