Young and Secretary, Department of Health (Social services) - [2020] AATA 733

Young and Secretary, Department of Health (Social services) [2020] AATA 733 (6 April 2020)
Division:GENERAL DIVISION
File Number(s):2017/4966
Re:Warren Albert Young
APPLICANT

Secretary, Department of HealthAnd
RESPONDENT

DECISION
Tribunal:Member A George
Date:6 April 2020
Place:Darwin

The application to set aside the 26 July 2017 decision under review is allowed.
The matter is remitted to the Respondent for reconsideration in accordance with the law in relation to assessing income and assets for means-tested Aged Care fee purposes.
Member A George
Catchwords
AGED CARE – Combined income and assets assessment – Where parties sought remittal of decision under review – Where evidence of Applicant’s net assets substantially different to figures used in previous decision – decision under review remitted to Respondent for reconsideration.
Legislation
Administrative Appeals Tribunal Act 1975 (Cth)
Aged Care Act 1997 (Cth)
Social Security Act 1991 (Cth)
Cases
Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577
Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194
Kang and Secretary, Department of Social Services (Social Services Second Review) [2019] AATA 758
Kang v Secretary Department of Social Services [2017] FCA 895
Secondary Materials
Social Security (Attributable Stakeholders and Attribution Percentages) Principles 2000 (Cth)
Social Security (Deeming Threshold Rates) Determination 2019
REASONS FOR DECISION
Member A George
6 April 2020
THE APPLICATION
On 16 August 2017 the Applicant, represented by Darwin Community Legal Service (DCLS), filed an Application for Review Form – AAT first review of a Centrelink decision of the 26 July 2017 decision (Exhibit R1:T1). In so doing, the applicant sought to have both his “Pension” and “Residential Aged Care” payments reviewed. The decisions sought to be reviewed were “Rate reduction” and “Assessment of assets” on the basis that “Believe Centrelink has incorrectly assessed assets and trust”.
BACKGROUND
The Applicant is a resident of a Residential Aged Care Facility. The Applicant has been diagnosed with “… advanced Alzheimer’s dementia” and “Often he needs help from 2-3 members of staff at one time to care for him safely” (Exhibit A1). The Applicant’s condition is unfortunately deteriorating.[1]
[1] Letter from Dr Vicki Evans dated 19 August 2019 comprising Annexure B of the Applicant’s Submission on Deemed Income dated 20 August 2019.
On 19 December 2016, Ms Lovegrove, on behalf of the Applicant, submitted a Permanent Residential Aged Care Request for a Combined Assets and Income Assessment form (Exhibit R1:T3). On 7 March 2017 the Respondent assessed the Applicant’s assets to be $312,519.94 and his income to be $1,337.24 per fortnight (Exhibit R1:T12).
Upon review dated 26 July 2017 (Exhibit R1:T2; the 26 July 2017 decision), the Applicant’s assets for Aged Care purposes were assessed to total $544,343 and constituted as follows:
(a)Principal Home  $62,723
(b)Financial assets, inc loan       $135,835
(c)Shares  $599
(d)Granny Flat  $62,753
(e)Contents  $200
(f)Trust Assets  $282,233
The Applicant’s income was assessed at $21,373 per annum, being a 16.6 per cent of the distribution from the Young Family Trust (YFT). The Applicant had been in receipt of these distributions for several years (Exhibit R3). These distributions occurred consequent to the will of Mayse Young of 9 October 1996, where she directed at paragraph [5(d)] that “…I direct that any rental monies obtained through this investment excluding all fees and charges shall form a part of my residuary estate and be distributed to my beneficiaries annually” (Exhibit R2). The Applicant was also assessed as having a loan of $135,209 with the YFT.
THE ISSUES
The Statements of Facts, Issues, and Contentions (SFIC) were received from the Applicant and Respondent on 12 April 2018 and 12 July 2018 respectively. The Applicant subsequently filed further submissions on 18 June 2019. The Respondent filed further submissions on 25 June 2019.
In its SFIC at paragraph [1] the Applicant clarified his application with the question: “Has the law in relation to assessing assets for both Age Pension and Residential Aged Care been correctly applied?” At this point the Tribunal notes that the 26 July 2017 decision does not address Age Pension issues, but only Aged Care. The 26 July 2017 decision results from a Permanent Residential Aged Care – Request for an Assets Assessment form (Exhibit R1:T3). As such, only the law in relation to Aged Care is relevant to this review.
The Respondent’s issue in its SFIC at paragraph [3.1] is “What is the correct assessment of the Applicant’s income and assets?” The Respondent submits that this involves consideration of whether the Applicant is an “attributable stakeholder” of the YFT. If the answer is in the affirmative, the Respondent submits that the Tribunal should consider:
(a)the Applicant’s “asset attribution percentage”;
(b)the value of the YFT; and
(c)the value of the Applicant’s other assets.
The Tribunal heard this matter on 3 July 2019. The Applicant was not present given his infirmity but was represented by Ms Campbell of the DCLS. Mr Burgess of Sparke Helmore represented the Respondent. Two witnesses appeared for the Applicant. These were the Applicant’s daughter, Ms Jo-Ann Lovegrove, who has the Applicant’s enduring power of attorney, and an accountant, Mr Thomas Smith. Mr Smith appeared by telephone. A former accountant, Mr Patrick Black, gave an unsworn statement dated 3 July 2019 but did not appear as a witness (Exhibit A8).
On 23 July 2019 the Tribunal sought further submissions from the parties with regard to the Social Security (Deeming Threshold Rates) Determination 2019 that took effect from 1 July 2019. The Tribunal received these submissions from the Respondent and the Applicant on 9 August 2019 and 20 August 2019 respectively.
Consistent with paragraph [12] of the Applicant’s Submissions of 18 June 2019, the Applicant submits that the following decisions be remitted for reconsideration following findings that they were “incorrect”:
(a)the 26 July 2017 decision; and
(b)a decision of 4 July 2018 to reject the Applicant’s application for financial hardship assistance (Annexure 1 to Applicant’s submissions of 18 June 2019).
In its further submissions of 25 June 2019, the Respondent objects to the Applicant seeking further orders relating to the decision of 4 July 2018. It would seem from the contents of the 4 July 2018 decision that any appeal should have been filed within 28 days of receipt. There is no evidence before the Tribunal of this having occurred. In any event, the Tribunal accepts the Respondent’s submission that the 4 July 2018 decision would first need to be reviewed elsewhere under s.85-8, and ss.85-4 or 85-5 of the Aged Care Act 1997 (Cth) prior to being heard by the Tribunal. In these circumstances, the Tribunal is not satisfied that it possesses the jurisdiction to review the decision of 4 July 2018 or remit it for reconsideration. The Tribunal therefore confines itself to the merits of the 26 July 2017 decision only.
In a variation of the Respondent’s further submissions of 25 June 2019 at paragraph [5.1], and noting the Respondent’s submission on deemed income of 9 August 2019, the Respondent seeks that the decision under review be set aside and remitted to the Respondent to determine the Applicant’s means-tested Aged Care fee based on the Tribunal’s “findings” that the:
(a)Applicant is an attributable stakeholder;
(b)Applicant has an asset attribution percentage from the YFT of 16.67 per cent;
(c)Applicant’s total assessable assets are $365,226.44;
(d)Applicant has an income attribution percentage from the YFT of 16.67 per cent; and
(e)Applicant’s total assessable assets are $38,448.87.
At the outset, the parties are clearly in agreement that the 26 July 2017 decision should be set aside and remitted to the Respondent for reconsideration.
SHOULD THE DECISION OF 26 JULY 2017 BE SET ASIDE AND REMITTED?
That both parties seek the 26 July 2017 decision should be set aside and remitted is indicative of the decision that the Tribunal should prefer. Indeed, the Tribunal is particularly swayed by the financial calculations annexed to the Respondent’s Submission on Deemed Income of 9 August 2019. At Annexure 1 the Respondent submits that the Applicant’s total net assets for the 2015/16 Financial Year were $381,208.86, calculated as follows:
(a)Principal home and granny flat  $150,000
(b)Loan asset to Family Trust  $135,209.14
(c)Shares  $70
(d)Contents  $500
(e)Attributed assets of Family Trust (16%)        $95,429.72
These figures are substantially different to those in the 26 July 2017 decision, where the Applicant’s assets were assessed to total $544,343. Additionally, the Respondent has acknowledged that the 26 July 2017 decision does not take deemed income into account. In these circumstances the Tribunal is satisfied that the 26 July 2017 decision is incorrect and that the law in relation to assessing the Applicant’s assets for Aged Care purposes has not been correctly applied.
The preferable decision is therefore for the Tribunal to set aside the 26 July 2017 decision and remit it for reconsideration.
IN REMITTING, SHOULD THE TRIBUNAL MAKE ANY DIRECTIONS OR RECOMMENDATIONS?
In their SFIC, neither party expressly seek any “directions or recommendations” from the Tribunal for the purpose of s.43(1)(c)(ii) of the Administrative Appeals Tribunal Act 1975 (Cth) (the Act). Rather, the parties only seek “findings”. The Respondent notably seeks that this matter is set aside and remitted to it with several specified “findings”; the first is whether the Applicant is an “attributable stakeholder” of the YFT.
The Tribunal notes that the 26 July 2017 decision does not straightforwardly address the issue of whether or not the Applicant is an attributable stakeholder. The issue of whether or not the Applicant is an attributable stakeholder is not addressed under the headings of “Findings of Fact” or “Reasons for Decision”. Rather, under the heading of “Law and Policy” the decision provides various references to the Social Security Act 1991 (Cth), including s.1207X, and the Social Security (Attributable Stakeholders and Attribution Percentages) Principles 2000 (Cth).
It would seem to the Tribunal that the 26 July 2017 decision assumes that the applicant is an attributable stakeholder, presumably under s.1207X(1)(a) of the Social Security Act 1991 (Cth) where “the individual is an attributable stakeholder of the company unless the Secretary otherwise determines”. The Applicant has made a submission to this effect in its SFIC of 12 April 2018 at paragraph [7]. However, this issue is clearly a complex one.
The Tribunal declines to make express “findings” for the benefit of the Respondent in circumstances where the Respondent has submitted that the matter should be remitted to it for reconsideration. The Tribunal also prefers not to make directions or recommendations under s.43(1)(c)(ii) of the Act where neither party has expressly sought that relief. Accordingly, no such directions or recommendations are made.
ORDERS
The application to set aside the 26 July 2017 decision under review is allowed.
The matter is remitted to the Respondent for reconsideration in accordance with the law in relation to assessing income and assets for means-tested Aged Care fee purposes.

I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for the decision herein of

Member A George.

..............[sgnd]....................
Administrative Assistant Legal
Dated: 6 April 2020
Date of hearing: 3 July 2019
Applicant’s representative: Ms. L. Campbell, Darwin Community Legal Service
Respondent’s representative: Mr A. Burgess, Sparke Helmore