Zheng and Department of Education, Training and Youth Affairs

[2001] AATA 182

DECISION AND REASONS FOR DECISION [2001] AATA 182

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No   N2000/1179

GENERAL ADMINISTRATIVE  DIVISION       )        
           Re      JULIA  ZHENG     
  Applicant

And    SECRETARY, DEPARTMENT OF EDUCATION, TRAINING AND YOUTH AFFAIRS            
  Respondent

DECISION

Tribunal       Senior Member M D Allen

Date12 March 2001

PlaceSydney

Decision      The decision under review is set aside and the Tribunal substitutes in lieu thereof its decision THAT:  the debt of $6,710.87 owed by Julia Zheng to the Department of Education, Training and Youth Affairs be waived.             
  (Sgd)                  M D ALLEN
  ..............................................
  Senior Member
CATCHWORDS
AUSTUDY  -  Applicant attended an American University in expectation that subjects studied there would be credited by The University of Queensland towards her degree at The University of Queensland.  After course completed not all subjects credited.  Whether Applicant had completed sufficient subjects to be granted AUSTUDY.  Whether overpayment of AUSTUDY should be waived due to special circumstances.
Student and Youth Assistance Act 1973  -  s7
AUSTUDY Regulations - reg34 and reg35
Secretary, Department of Social Security v Ellis 24 AAR 535

REASONS FOR DECISION

12 March 2001        Senior Member M D Allen 

1. By application made 31 July 2000 the Applicant sought review of a decision by a Social Security Appeals Tribunal that affirmed a prior determination by a delegate of the Respondent that she was not eligible for AUSTUDY payments in the calendar year 1996 and had been overpaid the sum of $6,710.87.

2. In 1996 the Applicant was enrolled as a full-time student at The University of Queensland, studying for a Bachelor of Commerce Degree.  The year 1996 was the Applicant's third and final year of the three year Bachelor of Commerce Degree at that institution.

3. Following enquiries made by the Applicant at the Overseas Exchange Student Department at The University of Queensland, the Applicant applied to study at the University of California at Los Angeles (UCLA).  She was accepted for study at this institution and departed Australia in March 1996.

4. Altogether Ms Zheng remained at UCLA for just over one year.  Her time there corresponded with the following "quarters" of that institution, namely spring, fall and winter.

5. Although she had attempted to obtain a ruling from the Administrator of the Commerce Department at The University of Queensland as to what UCLA subjects would be granted credit by The University of Queensland towards her degree, that official informed her the material presently available did not allow him to make a determination before she left for the United States of America.

6. Upon her arrival at UCLA the Applicant found that not all subjects which she had proposed to study were available to her.  Apparently UCLA has a policy that students from the United States of America get first preference as to entry into any subject class and exchange students are only permitted to enrol in that class if, after domestic demand has been satisfied, places are still available.

7. Other subjects which were pertinent to her University of Queensland Bachelor's Degree were only offered in the Masters programme at UCLA and, as the Applicant was a candidate for a Bachelor's Degree, she was ineligible to gain credit for those subjects.  Apparently one lecturer went so far as to say to her words to the effect of "you can sit here all semester but you can't enrol", and I understand that to mean, as did the Applicant, that she could attend lectures but she would not get any credit for that as she was not enrolled in the Masters programme.

8. Unfortunately for the Applicant, she was not aware of the system of allocating course demand before she arrived at UCLA. Given the correspondence – see Document T23 in the documents prepared for the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975, where The University of Queensland states:

   "Other exchange students have reported similar situations where classes are full when they actually arrive in the USA."

it seems to me that The University of Queensland authorities were negligent and failed in their duty towards Ms Zheng and other students in not advising them of pitfalls that may arise when seeking an overseas exchange.

1. Of the subjects undertaken by Ms Zheng at UCLA, only three had equivalents at The University of Queensland.  Difficulties were occasioned as course prerequisites at UCLA for two subjects involved her undertaking subjects which, according to The University of Queensland, she had already completed at that institution.  The Applicant actually disputes this, stating that only half of the UCLA subjects were equivalent.  In two other cases credit was not given by The University of Queensland as there was no equivalent subject at that university.

2. The attitude of The University of Queensland is set out in its letter of 29 September 1997 (T23):

   "Of the eight subjects proposed originally, three had equivalent subjects at The University of Queensland and earned 30 credit points, one subject overlapped sufficiently with a UQ subject which Ms Zheng had already completed not to allow credit, and the remaining five subjects were not attempted.
   Ms Zheng states that when she arrived at ucla there was a limited choice of subjects offered to her, some of which she had already completed at uq.  She tried to choose other appropriate subjects but because of the short time span she was unable to get confirmation of credit which may be given by UQ.  She also attempted to enrol in MBA subjects rather than undergraduate subjects, but encountered resistance from UCLA staff.
   …
   It had been expected that Ms Zheng would be given full credit for 120 credit points over 3 UCLA quarters, however, when the subjects were assessed upon her return, credit could not be given for all of her studies.  Students are normally expected to confirm that credit will be available before attempting subjects but in Ms Zheng's case she was not accepted into the subjects of her choice.  Other exchange students have reported similar situations where classes are full when they actually arrive in the USA.
   It appears that Ms Zheng attempted the subjects offered to her with the expectation that they would gain credit.  The Faculty of Business, Economics and Law gives credit only for subjects where there is an equivalent UQ subject.  If unspecified credit were available, Ms Zheng would have received an additional 20 credit points credit towards her degree."

1. Earlier The University of Queensland had expressed its views in a letter dated 14 January 1997 (T17):

   "Credit for studies successfully completed at the University of California will be transferred towards Ms Besley's Bachelor of Commerce degree at the University of Queensland.  She is expected to gain full credit towards her course, i.e. 40 credit points (#40) per semester.
   Ms Besley has been enrolled as a full-time student this University while attending the University of California."

(The reference to Ms Besley is to the Applicant's former married name.)

1. By letter dated 30 May 1997 (T20) The University of Queensland revised its assessment.  That letter reads inter alia:

   "The University of Queensland will grant Ms Besley 40 credit points (#40) from studies completed at the University of California towards her degree course at this University.  This represents one semester of full-time study at the University of Queensland."

1. Notwithstanding the above opinions by The University of Queensland, the net result of the Applicant's studies at UCLA was that she was granted 40 credit points towards her Bachelor of Commerce Degree, 30 attributed to Semester 1 of 1997 at The University of Queensland, and 10 to Semester 2 of 1996 at that institution.

2. Section 7(1) of the Student and Youth Assistance Act 1973 states:

   "Subject to and in accordance with this section and the regulations, the Secretary may grant a benefit under this Part to a person who:

   (a)…

   (b)is enrolled, or proposes to enrol, as a student of an education institution for that year or that part of that year; and

   (c)is undertaking, or proposes to undertake, wholly at that institution in that year or that part of that year:

   (i)a course of study or instruction that the Minister has determined in writing to be a … tertiary course, for the purposes of this section; or

   (ii)a part of a course of study or instruction, … that the Minister has determined in writing to be a … tertiary course, for the purposes of this section."

1. On 5 December 1994 the Minister made a determination, being No 1994/1, which determined that the Bachelor of Commerce Degree at The University of Queensland was a course for the purpose of paragraph 7(1)(c) of the Act.  No UCLA course was determined to be a course for the purpose of section 7 of the said Act.  As such, it is only so far as study undertaken by the Applicant at UCLA has been credited by The University of Queensland, for the purpose of the Bachelor of Commerce Degree at that institution, that the Applicant can be considered eligible for AUSTUDY in respect of her study at UCLA.

2. To be considered to be a full-time student at The University of Queensland in 1996, as required by regulation 34(1) of the AUSTUDY Regulations, the Applicant must have been enrolled in and undertaking at least three quarters of the normal amount of full-time work for the Bachelor of Commerce Degree at The University of Queensland in relation to either a semester or full year of the course. See subregulations 34(2) and (3), and 35(1):

   "34. (1)   A tertiary student must study full-time.

   (2)   To be a full-time student, a student must be enrolled in and undertake at least three-quarters of the normal amount of full-time work for a period as set out in regulation 35.

   (3)   A student is not full-time in a period if the amount of work of the course that he or she is undertaking in, or is enrolled in for, that period is less than three-quarters of the normal amount of full-time work for that period.

   (4)   …

   35.  (1) If a course is a designated course for the Higher Education Contribution Scheme (called HECS) under subsection 34 (1) of the Higher Education Funding Act 1988:

   (a)the normal amount of full-time work for a year of the course is the standard student load determined by the institution for the purposes of HECS; and

   (b)the normal amount of full-time work for a semester of the course is 0.5 of the standard student load."

It is clear that the legislation simply does not permit the Applicant to have been regarded as a full-time student of The University of Queensland during the year 1996.  Although the determination has been made in retrospect, the fact is the Applicant did not meet the minimum workload of 30 credit points in 1996, and so cannot be regarded as a full-time student.

1. Whereas the debt has correctly been raised against the Applicant, the question arises whether in the exercise of its discretion the Tribunal should decide that the debt be either written off or waived.

2. At the outset I will state that I regard write off as inappropriate.  The Applicant is in employment and has no other significant debts.

3. Section 290C of the Student and Youth Assistance Act 1973 (as amended) reads:

   "The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

   (a)the debt did not result wholly or partly from the debtor or another person knowingly:

   (i)making a false statement or a false representation; or

   (ii)failing or omitting to comply with a provision of this Act; and

   (b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

   (c)it is more appropriate to waive than to write off the debt or part of the debt.

   Note:Section 287 allows the Secretary to write off a debt on behalf of the Commonwealth."

As to what may or may not constitute special circumstances, I refer to the judgment of Carr J in Secretary, Department of Social Security v Ellis 24 AAR 535 at 539:

"In Beadle v Director-General of Social Security (1985) 7 ALD 670, a Full Court of this Court had to consider whether the Administrative Appeals Tribunal had erred in its interpretation of s 102(1)(a) of the Act which provided for an extension of time in which to claim a family allowance '… in special circumstances …".  At 673-674 the Full Court said:

''Presumably in this context special circumstances must include events which would render the six months unfair or inappropriate. … It would depend upon the circumstances of the particular case whether these constituted special circumstances.  We do not think it is possible to lay down precise limits or precise rules.  The matter is one for the Director-General bearing in mind the purpose for which the power is given.  The phrase 'special circumstances', although lacking precision, is sufficiently understood in our view not to require judicial gloss.'

In Groth v Secretary, Department of Social Security (1995) 40 ALD 541 at 545, Kiefel J, after referring to Beadle, said:

'… for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth's case from others, to take it out of the usual or ordinary case.  That was, I consider, the only inquiry to be undertaken in this case.  It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.  The inquiry I have referred to would involve considering what would be the effect, if the provision in question or the principle of liability it creates, is applied.'"

That particular case was referrable to a Social Security recipient but similar principles apply here.

1. A point in favour of the Applicant is that she did not undertake her exchange in America as other than a genuine student.  Her links with The University of Queensland were maintained as during the year 1996 she still had to pay student fees and compulsory Student Union fees to The University of Queensland.

2. In addition, the Applicant was disadvantaged by the failure of The University of Queensland to recognise subjects undertaken by her.  Had she been credited with all the subjects she had taken at UCLA she would have completed her degree in the first semester of 1997.  As it was she had to make up credits upon her return to Australia and hence was delayed in obtaining her degree and thus delayed in obtaining professional employment.

3. There is no doubt that the Applicant was genuine in her approach to studying at UCLA.  She was perhaps naive in leaving for UCLA without a firm commitment as to what The University of Queensland would accept as equivalent subjects, however, as stated above, The University of Queensland seems to have abnegated all responsibility towards advising and counselling students as to the pitfalls in becoming an exchange student.

4. I consider that at all times the Applicant was a full-time student and the failure by The University of Queensland to recognise the subjects undertaken by her at UCLA was something outside her control.  Once committed to study at UCLA she could hardly abandon her course there and return home, and in any event The University of Queensland still had not ruled upon the subjects she was taking.  In this regard I accept her evidence that she posted course details to The University of Queensland but they were never received by the Commerce Department at that institution.  It was only upon return to Australia that she was informed she would not be granted credit for all subjects.

5. I find that the Applicant's inability to undertake a full subject load in the 1996 academic year arose principally from circumstances outside her control and were unintended.  I have discussed these circumstances above.  The particular circumstances in her case take it out of the usual run of cases and can truly be said to be exceptional and contained features out of the ordinary.

6. For those reasons therefore I consider that special circumstances do exist and therefore set aside the decision under review and substitute the Tribunal's decision that whereas the Applicant is indebted to the Respondent in the sum of $6,710.87, recovery of that sum is to be waived.

I certify that the 25 preceding paragraphs are a true copy of the reasons for the decision herein of:

Senior Member M D Allen

Signed:         .....................................................................................
  Associate

Date of Hearing  22 February 2001
Date of Decision  12 March 2001
Solicitor for the Applicant         Applicant was self-represented
Solicitor for the Respondent    Mr G Peek,
  Australian Government Solicitor's Office