YOSRY SEDEN and SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS
[2010] AATA 370
•12 May 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 370
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2009/3431
GENERAL ADMINISTRATIVE DIVISION ) Re YOSRY SEDEN Applicant
And
SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS
Respondent
DECISION
Tribunal Mr P W Taylor SC, Senior Member Date of oral decision 12 May 2010
Date of written reasons 18 May 2010
Place Sydney
Decision For the reasons given orally at the hearing of this matter, the Tribunal affirms the decision under review.
The oral reasons for decision have been transcribed by Auscript Australasia Pty Ltd the Commonwealth reporting service.
An edited copy of the transcript of those reasons is attached and is provided as a statement in writing of the Tribunal’s reasons for its decision.
..................[sgd]..........................
Mr P W Taylor SC
Senior Member
CATCHWORDS
SOCIAL SECURITY – periodic workers compensation payment – receipt of Newstart allowance in a periodic payment period – compensation affected payment – discretion to treat payment as not having been made – whether special circumstances exist – decision under review affirmed
Social Security Act 1991 ss 1173, 1184, 1184K
REASONS FOR DECISION
12 May 2010 Mr P W Taylor SC, Senior Member 1. Mr Seden suffered an incapacitating work injury in December 2002. He received workers compensation payments from GIO Workers Compensation, apparently until about May 2003 although there is a possibility, having regard to a document that I will refer to later, that payments may have continued until July 2003.
2. In May 2003, GIO Workers Compensation wrote to Mr Seden telling him that it had stopped the workers compensation payments. It told him it considered he was no longer unable to work. In June 2003, Mr Seden sought legal advice about making a compensation claim against his former employer. He told Centrelink about his proposed claim and applied, successfully, to be paid Newstart allowance.
3. Mr Seden did bring proceedings in the Workers Compensation Commission of New South Wales against his former employer. Those proceedings were determined by a consent award, which is the document I referred to earlier, on 28 October 2005. The terms of the award were that Mr Seden was entitled to compensation at a rate of $300 per week for the 25 week period from 10 July 2003 until 1 January 2004. The total award amount was $7,500.
4. In the period to which the workers compensation award related, Mr Seden had received Newstart allowance, and perhaps other benefits, at a rate of $190 a week. The total amount of those social security payments he received relating to that period was $5,034.04.
5. In December 2005 GIO Workers Compensation wrote to Mr Seden informing him that there had been a change in the practices it followed in relation to the payment of workers compensation. It told him that it would thereafter make payments direct to him and asked him to provide his tax file number. It appears that in making this request GIO had in mind, although its letter did not explicitly say so, that it would withhold any compensation payments to him unless and until he provided his tax file number. Mr Seden recalls receiving this letter and recalls also expecting that he would be paid the amount of the workers compensation settlement that had been the subject of 28 October 2005 award.
6. However, in early January 2006 he received a letter from Centrelink informing him of its decision to recover part of the compensation payment, that part being the amount of the Newstart payments he had received for the period to which the workers compensation award related. Mr Seden did not respond to either the letter from the GIO in December 2005 or Centrelink’s letter. He appears to have taken the view that there was no personal benefit to him in responding to GIO’s request to provide a tax file number, since even if he received the money he apprehended that Centrelink would pursue him to recover it.
7. As it turned out there was a long, and from an outsider’s perspective, difficult to understand, delay before Centrelink eventually pursued GIO by providing it with notices of recovery under section 1184 of the Social Security Act 1991.
8. Almost two years after it initiated that notice of recovery provision, Centrelink decided on 13 October 2008 to reject Mr Seden’s request to reconsider its decision to recover the payment. That decision was affirmed by the authorised review officer on 10 November 2008. The Social Security Appeals Tribunal dismissed Mr Seden’s appeal against that decision on 25 May 2009. Whilst all of those decisions were made, and notwithstanding Mr Seden’s opposition to Centrelink’s attempt to recover the $5,304 amount, no payment was made by GIO.
9. It turns out that, by a process the evidence does not reveal, GIO’s obligations in relation to the payment of the October 2005 consent award ultimately came to be a liability of Cambridge Integrated Services, an entity which trades under the name Xchanging.
10. The Social Security Appeals Tribunal reasons for decision record attempts that tribunal made to determine the actual state of affairs in relation to the payment of the $7,500 amount. It appears that the tribunal’s inquiries ultimately resulted in two things occurring. First, Mr Seden obtained, apparently on or about 23 February 2010, a cheque from Xchanging for the balance of the workers compensation settlement amount. That cheque was for $918.04. The second thing that happened is that on 27 April 2010, and there may have been an earlier letter to Mr Seden, Xchanging wrote to Mr Seden confirming the fact of the payment that had been made and providing a breakdown of the way in which the total settlement amount of $7,500 had been paid.
11. That breakdown indicates that $750 was repaid to the Health Insurance Commission by way of reimbursement. Centrelink was paid $5,034.04. Ttaxation was deducted in an amount of $797.92, and the balance of $918.04 was paid to Mr Seden.
12. The basis of Centrelink’s claim to recover is the statutory provision in section 1173 of the Social Security Act. In essence, it provides that where a person receives a periodic compensation payment, and the person was not at the time of the event that gave rise to the compensation entitlement qualified for or receiving a compensation affected payment, and the person received a compensation affected payment in relation to a day or days in a periodic payment period, then the rate of the person’s compensation affected payment is reduced, essentially on a dollar for dollar basis.
13. Putting those statutory terms into an understandable every-day vernacular, the effect of section 1173 is this: if a person receives a workers compensation weekly payment and the injury to which the payment relates occurred before the person was entitled to receive a social security payment, if those two things happen, then when the person receives their workers compensation payment, if it’s a weekly compensation payment, the rate of the person’s entitlement to any social security benefit (that is also a compensation affected payment) is retrospectively reduced on a dollar for dollar basis. Those circumstances applied to Mr Seden’s October 2005 workers compensation settlement award.
14. The next step in the legislative justification for Centrelink’s claim is section 1184 of the Social Security Act which permits the Secretary to require repayment of any amount that a social security benefit recipient has received where the receipt is more than what the person was entitled to receive. Section 1184 applies even if, as a consequence of section 1173, the person’s entitlement to a compensation affected payment is altered subsequently by the receipt of a workers compensation payment. Where the Secretary is entitled then to recover the amount, the further qualification is that the Secretary also has a residual discretion under section 1184K subsection (1) of the Social Security Act to deem the relevant workers compensation payment as not having been made if the Secretary considers “it is appropriate to do so in the special circumstances of the case”.
15. I should add, by way of simply an acknowledgement of the peculiar circumstances of this case, that the Secretary’s powers under section 1184 are complimented by other provisions of the Social Security Act that permit the Secretary to give notice to a person who is obliged to make a compensation payment, such as an insurer in the position that GIO Workers Compensation was. The effect of those other provisions in the Social Security Act is that the Secretary has parallel avenues by which he can, where section 1173 otherwise operates, either recover a payment from a social security recipient once the money is received or pre-empt the compensation payment being made to the plaintiff in the workers compensation proceedings and pre-empt that payment by requiring the relevant insurer to make the reimbursing recovery payment direct to the Secretary rather than involve the Secretary, the recipient and the insurer in the circuitous process of payment first by the insurer to the plaintiff and then a recovery by the Secretary from the plaintiff.
16. As it happened, in the present case, the Secretary did, shortly after the workers compensation award, give appropriate notice, but for reasons that are not either easy to understand or necessary to explore, it appears that the insurer never made the payment in response to the notices, nor did the Secretary follow the matter up. Leaving that aside, it is necessary to consider whether or not Mr Seden is able to establish the appropriateness of disregarding the workers compensation payment he has received, and by that I include the full amount of the $7,500 amount.
17. The fundamental difficulty that Mr Seden faces in establishing special circumstances is the readily understandable policy underlying the recovery provisions in section 1184 and section 1173 of the Social Security Act. It is relatively easy to understand the way in which the legislation operates, and is intended to operate, in circumstances such as those which befell Mr Seden. He suffered an incapacitating workplace injury. His entitlement to compensation was disputed. He took proceedings to enforce that right. In the period before those proceedings were resolved no compensation payments were made. In the meantime he successfully sought and was granted Newstart allowance to provide him with a substitute form of income during his period of incapacity. Ultimately, his compensation claim was successful and he was to that extent vindicated in his claim that the period of his incapacity was directly attributable to his workplace injury, and consequently his loss of income in that period was similarly attributable to his workplace injury.
18. The policy of the provisions to which I have referred is that in circumstances such as those I have outlined, the ultimate financial responsibility for the compensation provided to Mr Seden, and by that I include both the payments that he received under the strictly correct description of compensation, and the income assistance which he was provided under the Social Security Act, is that the economic cost of that benefit to him should ultimately be borne by his employer and his employer’s insurer. This Mr Seden concedes, although in using that expression I do not attribute to him any particular consequence other than a recognition of the apparent fairness of the policy.
Nevertheless, he contends that special circumstances apply to him. It is not easy to identify the precise components of the matters that Mr Seden contends constitutes special circumstances in his case, but they seem to involve these elements. First, a complaint that the period adopted in the workers compensation award of 28 October 2005 was essentially arbitrary. I will come back to this argument in a moment. Second, he contends that in substance and practical reality the compensation amount that he received should be regarded as compensation for pain and suffering. Third, he contends that the injury which triggered his entitlement to compensation has had particularly severe consequences to him in terms of interrupting his career and jeopardising his prospects of further progression and further increase in his income. Finally, Mr Seden points to his present circumstances, which, whilst not uncomfortable, plainly do not reflect the aspirations he has for himself.
19. I shall deal with each of those four points. First, the arbitrariness of the compensation period. Mr Seden complains that the workers compensation award could have been made in relation to a period other than - and he suggests earlier than - the period from July 2003 to January 2004. I do not accept that this argument is either proper or that it is even relevant. I am not satisfied that it is proper because the circumstances revealed by the evidence suggest that Mr Seden was in employment until December 2002, that he was paid workers’ compensation in fact from December 2002 until at least May 2003 and perhaps until July 2003, and that the only period in which he was relevantly unemployed and incapacitated was for the period from December 2002 until December 2003. In those circumstances it seems to me it would have been quite improper for anybody to have suggested that the workers compensation weekly amount should be attributable to any period other than that to which it is accorded in the workers compensation consent award.
20. Mr Seden’s second argument is that his workers compensation payment is effectively, and should be understood as, compensation for pain and suffering. I do not accept that argument. It is often difficult for a non‑lawyer to understand - and indeed often they will have no interest in understanding - the significance of the different legal regimes that apply to workers compensation entitlements and common law damages. Generally speaking, the workers compensation regime does not contemplate compensation for pain and suffering except in relation to particular types of disabling injury for which lump‑sum payments can be made.
21. The weekly compensation award reflected in the consent settlement of 28 October 2005, is very clearly not a lump sum payment award and is very clearly in the nature of compensation for workplace incapacity. It may be that in differently constituted proceedings, Mr Seden may have been able to make out an alternative and additional claim for pain and suffering associated with the injury that he suffered. If he had received compensation for pain and suffering, it would, no doubt, have been for an additional amount on top of any compensation for loss of income during the incapacity period. Indeed, if Mr Seden ever had such a claim, it might, subject to the existence of any statute of limitation provisions, still be available to him.
22. But whether or not that is the case, it seems to me that careful analysis requires one to simply take the view that the workers compensation consent settlement award, in truth and reality, reflects compensation for income during the period of his incapacity from July 2003 until January 2004. In those circumstances, there is no substance in Mr Seden’s contention that special circumstances apply because his understanding is that the compensation amount properly relates to the pain and suffering.
23. I then turn to Mr Seden’s third argument, namely his personal circumstances. I will not elaborate on Mr Seden’s personal circumstances in any significant detail. The Social Security Appeals Tribunal recorded, in paragraph 11 of its reasons for decision, Mr Seden’s personal circumstances as it then understood them. He has indicated to me that the information taken into account by the Social Security Appeals Tribunal, still remains current. One can add to it Mr Seden’s workplace history, which he shortly summarised in his personal particulars that he provided to the Tribunal for the purpose of these proceedings. Mr Seden’s work history records, in the period that I regard as relevant, that he has been in full-time employment, effectively since December 2003. That period of full-time employment has been in a range of activities, only the latter of which, his employment for the last two years, has been close to using the skills which he had developed in his periods of employment up until December 2002.
24. Mr Seden’s present financial circumstances are not, therefore, circumstances that can reasonably be regarded as involving financial hardship. I do not, by that, suggest that he is a person who enjoys anything other than a relatively modest income, and I do not suggest that his circumstances are free from difficulty. I alluded earlier to his evidence that his present circumstances, where he lives with his parents, are not ones which he finds entirely comfortable, and certainly not circumstances that are consistent with the aspirations that he reasonably had for himself, certainly before the incident that gave rise to his incapacity.
25. His understanding, in that regard, and his aspirations are both reasonable and understandable. However, as against the broad policy purpose of the legislation, it seems to me that Mr Seden’s circumstances, taken over all, are ones where there is no particular hardship to which he can point and no circumstance that suggests, in any forceful or even moderately persuasive way, that special circumstances exist that would warrant the exercise of the discretion contemplated by section 1184K of the Social Security Act.
26. I have not elaborated on the fourth of the matters, to which I alluded earlier, as one of the grounds Mr Seden relies upon in support of his contention that special circumstances exist. I have, however, taken that matter, which is broadly summarised as dealing with his aspirations for his future existence and his dissatisfaction with his current state of affairs, into account in what I have said earlier.
27. For these reasons, I am not satisfied that Mr Seden has established that the special circumstances exist.
DECISION
28. The decision under review is affirmed.
I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of Mr P W Taylor SC, Senior Member
Signed: ............[sgd]....................................................................
AssociateDate of Hearing 12 May 2010
Date of Oral Decision 12 May 2010
Date of Written Reasons 18 May 2010
Appearance for the Applicant Self-representedAppearance for the Respondent Ms E Warner Knight, Australian Government Solicitor
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