Cvetanoska and Department of Family and Community Services [2000] AATA 459 (9 June 2000)

Last Updated: 15 June 2000

DECISION AND REASONS FOR DECISION [2000] AATA 459

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N1999/1220

GENERAL ADMINISTRATIVE DIVISION )

Re VIOLETKA CVETANOSKA

Applicant

And DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Dr J D Campbell

Date 9 June 2000

Place Sydney

Decision 1. The Tribunal sets aside the decision under review and in substitution thereof finds that: (a) the charge for the preclusion period had been incorrectly calculated; and (b) a sum of $10,000, being part of a compensation payment, is treated as not having being made; special circumstances have been found to exist as relating to the death of the Applicant's husband and particular expenditure arising there from; and (c) the Applicant is entitled to a repayment of $2778.20, arising from the circumstances nominated in (a) and (b).

(Sgd) J D Campbell

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

Member

CATCHWORDS

Social Security - compensation affected payments - preclusion period - special circumstances - death of husband - financial hardship - cultural obligations - medical impairments.

Social Security Act 1991, sections 17, 1165, 1166, 1184

Re Green and Secretary, Department of Social Security (1990) 21 ALD 772

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

Beadle v Director-General Social Security (1985) 7 ALD 670

Kryzwak and Secretary, Department of Social Security (1988) 15 ALD 690

Stevens and Secretary, Department of Social Security (1989) 18 ALD 659

Re Colaiacolo and Secretary, Department of Social Security (AAT 2109, 24 April 1985)

REASONS FOR DECISION

9 June 2000 Dr J D Campbell

2. Mrs V Cvetanoska ("the Applicant") in this matter seeks a review of the decision of the Social Security Appeals Tribunal ("the SSAT") dated 12 July 1999, which affirmed the decision dated 28 May 1999 of an authorised review officer of Centrelink. This decision affirmed the primary decision dated 2 March 1999 made by a delegate of the Secretary, Department of Family and Community Services ("the Respondent") that the Applicant owed a debt to the Commonwealth of $8390.60, this being a recovery of a compensation charge as a result of a preclusion period operating from 1 August 1997 until 24 September 1998.

3. A hearing was held before the Tribunal on 25 January 2000 at which the Applicant was self represented but assisted by her daughter, Ms M Cvetanoska. The Respondent was represented by Ms Collis, an advocate from the Administrative Law Section of Centrelink. The Tribunal was assisted by an interpreter fluent in the Macedonian language.

4. The following written material was placed in evidence before the Tribunal.

Documents prepared pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 T T1 - T19, pp1 - 65

Notification of cancellation of Youth Allowance dated 13 January 2000. Exhibit Exhibit A1

Certificate of Registration of a Toyota car. Exhibit A2

Statement of Commonwealth Bank home loan summary 1 July 1999 - 31 December 1999 (4 pages). Exhibit A3

NRMA Insurance Limited letter dated 1 December 1999 concerning 1989 Holden Camira (2 pages). Exhibit A4

Commonwealth Bank statement Mr Cvetanoska and a letter of 3 pages 23 March 1999 - 4 June 1999. Exhibit A5

Italian Monument Pty Ltd order no 990 dated 24 August 1999. Exhibit A6

Medical certificate re the Applicant issued by Dr Kanawati dated 18 September 1999 and 25 January 2000. Exhibit A7 Exhibit A7

Material relating to Mrs Cvetanoska's ear, nose and throat condition (6 pages). Exhibit A8

Medical note re Mrs Cvetanoska by Dr Sokolovic dated 29 September 1999. Exhibit A Exhibit A9

Material prepared by the Applicant relating to her financial circumstances (6 pages). Exhibit A10

Applicant's statement of facts and contentions and submissions dated 25 January 2000. Exhibit A11

Respondent's statement of facts and contentions dated 24 January 2000. Exhibit R1 Exhibit R Exhibit R1

Letter from Centrelink to Applicant dated 3 March 1999 concerning compensation payments. Exhibit R2

Memo from Centrelink to changes dated 19 January 2000. Exhibit R3

ISSUES:

4. The relevant issues in the matter are:

a) whether the decision to recover a compensation charge of $8390.60 from the Applicant as a result of a compensation preclusion period from 1 August 1997 to 24 September 1998 is correct; and

b) whether special circumstances exist which would warrant disregarding all or part of the compensation payment.

LEGISLATION:

5. The relevant legislation in this matter is the Social Security Act 1991 ("the Act") and in particular sections 17, 1165, 1166, 1184.

BACKGROUND:

6. On 2 September 1997 the Applicant was advised that she was to be paid a

parenting allowance of $65.10 per fortnight, commencing 11 September 1997 (T3). The Applicant had previously suffered an injury at work on 11 September 1996. The Applicant was awarded $50,000 in a compensation settlement on 10 February 1999. On 3 March 1999 Centrelink issued an advice to HIH Workers Compensation section, with similar advice to the Applicant that an amount of $8390.60 must be repaid to Centrelink from the lump sum. Following a request by the Applicant's solicitor on 12 March 1999 (T10), Centrelink, in response on 20 March 1999, stated that as a consequence of the settlement the Applicant was subject to a preclusion period of 1 August 1997 until 24 September 1998 and that the decision to recover a charge of $8390.60, being the amount of parenting paid to the Applicant during the preclusion period, was correct (T11). On 6 April 1990 the Applicant's solicitor advised the Respondent that the Applicant's husband had died on 3 April 1999 (T13). On 25 June 1990 the Respondent advised the Applicant that the preclusion period had been correctly calculated, that the settlement did not affect her current entitlement to payment under the Act and that there were no special circumstances that would allow an exercise of discretion to treat the whole or part of a compensation payment as not having been made or not liable to be made (T16). On 12 July 1999 the SSAT affirmed the earlier decisions (T2).

EVIDENCE:

7. In oral evidence to the Tribunal, the Applicant described how she received the money from compensation shortly before the death of her husband, who had not been working and was on a Newstart Allowance. From the compensation money received, the Applicant detailed that the money was expended in the following fashion:

$8390.60 withheld and paid to Centrelink as per instructions by

Centrelink to the HIH Compensation Insurance Section;

$10,000 to pay doctors, physiotherapists, hospital and Medicare;

$10,000 to cover husband's funeral expenses and Commonwealth

Bank overdraft (husband's account);

$18,000 paid off home loan.

8. Further the Applicant stated that with her husband's funeral, there was a cultural obligation to observe particular religious customs on the first three days following death and thereafter on the ninth and fourteenth days and quarterly for three years, with each of the activities involving a not inconsiderable financial outlay.

9. The Applicant told the Tribunal that life had been hard following the death of her husband and that there was a shortage of money, with two children remaining in the family home. The Applicant stated that her late husband used to undertake all the work around the family home. The Applicant stated that she had been taking tablets for depression prior to her husband's death, but now even with more tablets, she is finding it harder to cope, that is to pay the bills and to look after the children. The youngest daughter, aged seven, was said by the Applicant to get very angry, and lock herself in her room. As a result of her father's death she was seen by the school counsellor, because of much crying, even though she is doing very well at school. Further, the daughter aged 19 was described by the Applicant as suffering form asthma, allergies and headaches.

10. The Applicant described to the Tribunal that she had a number of medical impairments, and that she was taking tablets for nerves, cholesterol, acid, allergy/asthma and headaches and that she was awaiting nasal surgery in a private hospital. Further the Applicant stated that she could not speak English, was unable to read a street directory, and that, despite taking tablets all the time, often locks herself in her room at home, crying and with thoughts of getting away and never coming back. In summary the Applicant stated "I do not have a husband, a life or money".

11. In relation to her financial circumstances, the Applicant stated that money was becoming "shorter and shorter" with the demands of being "more and more expensive" and that this was making her become more anxious. She finds that she has to give money to her youngest daughter every day for lunch, and school excursions when she can, and often has to refuse requests for money for clothes and other requirements. Further the Applicant stated that she has been forced to borrow money from friends ($4000) to assist in the payment of bills arising from activities surrounding the funeral and other necessities; that she borrowed $20,000 from the Commonwealth Bank by way of mortgage on the family property to pay for her husband's headstone ($8000) and to purchase a replacement motor vehicle ($12,000) as the original car had been written off following an accident; and that she had further forthcoming expenses involving her own nasal surgery ($4000) and repairs to the roof of her home ($4000), as well as a $300 monthly mortgage repayment.

12. In response to questions asked in cross examination the Applicant confirmed that there is no money remaining from the settlement, and that she, as a member of the Macedonian Community, must follow what the community does and that if she did not, she would be embarrassed. In her view she has spent as much as she could, in doing what she had to do in the circumstances. Further the Applicant confirmed that her medical condition had been present before the compensation settlement, with the depression being present for the past three years. In talking of her late husband the Applicant revealed that he had been earning at a considerable rate, but for a year and a half prior to his death he had been on a Newstart Allowance. Finally the Applicant stated that her daughter, aged 19, having completed her higher school certificate, was undertaking a course at TAFE and working three days per week, while making an occasional contribution to family finances.

WRITTEN EVIDENCE

APPLICANT:

13. The following written material was provided to the Tribunal by the Applicant in support of her contentions.

a) Exhibit A1 Cancellation of Ms Sonia Cvetanoska Youth Allowance dated 13

January 2000; and

b) Exhibit A2 Registration Certificate of a Toyota vehicle dated 31 December 1999 with transfer and stamp duty of $401; and

c) Exhibit A3 Commonwealth Home Loan Account Summary showing balance at 31 December being $33,321.60. Repayments in advance $70,527.11, which can be withdrawn on request. Required repayment $250 per month. Evidence of $20,000 special withdrawal and $18000 deposit; and

d) Exhibit A4 NRMA Insurance Limited advice of 21 December 1999 that the Applicant's previous car had been written off following an accident and $1800 forwarded in final settlement; and

e) Exhibit A5 Commonwealth Bank personal account of Mr Cvetanoska, which continued to operate after his death and which was closed on 22 July 1999, a sum of $2131.69 having been paid on 20 July 1999; and

f) Exhibit A6 Italian Monuments Pty Ltd order no 990 dated 24 August 1999 - amount $8000; and

g) Exhibit A7 Medical certificate from Dr Kanawati, dated 18 September 1999 and 25 January 2000 that the Applicant has s severe depression and a depression state respectively, and that she has received counselling and medication; and

h) Exhibit A8 Indicates that the Applicant will have to wait approximately 6 months for nasal surgery at Bankstown Public Hospital (16 June 1999) and that Dr Havas would undertake the surgery at a private hospital with the Applicant being out of pocket by some $4000, for excess doctors fees beyond medical rebate, pathology and hospital fees (4 May 1999); and

i) Exhibit A9 Dr Sokolovic, a consultant psychiatrist reports on 29 September 1999 that the Applicant has dysthymia and reactive anxiety and depression. Requires regular supportive therapy and medication; and

j) Exhibit A10 i) Demonstrates an annual income and expenditure analysis for the Applicant, demonstrating a net annual income of $1,652.33 for the Applicant to meet food and daily living expenses; and

ii) Confirms the expenditure of the compensation money; and

iii) Nominates monies owing and future expenditure; and

iv) Is not current as regards annual analysis or debt owing.

WRITTEN EVIDENCE

THE RESPONDENT:

14. The Respondent in documentation presented to the Tribunal made the following statements:

a) the charge amount of $8390.60 had been incorrectly calculated and that the proper calculation for the preclusion period 1 August 1997 until 24 September 1997 should be $7354.70, resulting in a refund to the Applicant of an amount of $1035.90; and

b) that the sum of $10,000, being expenses related to funeral and other like expenses associated with the death of the Applicant's husband, should be disregarded from the lump sum payment of $50,000, because such circumstances were considered to be special. As a consequence the Respondent stated that the new preclusion period of 48 weeks extended from 1 August 1997 until 2 July 1998, resulting in an outstanding charge of $5612.40; and

c) that as a result of these two charges, the Applicant was entitled to a refund of $2778.20, being an amount comparison $1035.90 arising from an incorrect charge and a sum of $1742.30 arising from a reduction in the preclusion period.

SUBMISSIONS:

15. The Applicant contended that in their entirety her circumstances are special within the meaning of subsection 1184(1) of the Act, such as to make it appropriate to treat the whole of the compensation payment made to her as not having been made. In particular, attention should be paid to the following circumstances:

* The Applicant's work related physical injury, her severe depression, and other medical impairments of acid, allergies, asthma and cholesterol; and

* Issues surrounding the death of her husband; and

* Ongoing financial hardship, as demonstrated by annual revenue and expenditure analysis, debts owing and expected; and

* Social circumstances of the Applicant in relation to education, ability to speak and read English, and her previous reliance on her husband to do everything; and

* The medical conditions of the two younger daughters.

16. The Respondent contends, that having conceded the issue of special circumstances in so far as it relates to expenses arising from the unexpected death of the Applicant's husband, that there are no further special circumstances that would warrant the exercise of a discretion contained in section 1184 of the Act to disregard part or whole of the lump sum preclusion period. In making such a contention the Respondent relies upon a number of earlier decisions made by the Tribunal and the Federal Court which define the nature, scope, ambit and extent of the phrase "special circumstances", and in particular to the cases where decisions have been made as to what does or does not constitute special circumstances.

17. It is the Respondent's submission, that apart from the funeral and associated expenses, much of the compensation money has been spent on matters of personal preference, such as headstone, cultural expenses regarding death and prepayment of mortgage expenses. Further, the election to purchase a car and to have a nasal operation performed in a private hospital are again matters of a personal preference and as such it is not reasonable for such expenses to have been made without regard to the Applicant's future annual living expenses for basic food and other daily living expenses.

CONSIDERATION AND FINDINGS:

18. In preliminary comment, the Tribunal observes that the facts in this matter are not in contention, nor is the reargument between the parties on issues of the Applicant's credit. The issue that remains between the two parties is whether the charge made has been correctly calculated and, whether the Applicant's circumstances constitute special circumstances and if so should a discretion be exercised to disregard the whole or in part of a compensation payment as not having been made.

19. In considering these issues, and the evidence that has been placed before the Tribunal, the Tribunal finds the following facts:

a) the Applicant was in receipt of a parenting payment at all times between the period 26 October 1995 and 5 November 1998 (T18); and

b) the Applicant was injured at work on 11 September 1996; the Applicant received periodical payments of compensation to 31 July 1997; the Applicant was awarded $50,000 in a lump sum compensation settlement on 10 February; this included an amount for economic loss; a sum of $8390.60 was repaid to Centrelink for the lump sum; a preclusion period was established and covered the period 1 August 1997 until 24 September 1998 (T11); and

c) the Applicant's husband died on 3 April 1999 (T13); and

d) the Applicant did suffer from a work related injury and depression prior to the compensation settlement and continues to do so, with deepening of the depression and anxiety occurring consequential to the death of her husband (Dr Kanawati; Dr Sokolovic; Applicant's evidence). Further the Applicant is said to be suffering from asthma, allergies, acid and high cholesterol, as well as requiring operative attention to her nasal passages (Applicant, Dr's Bridger, Havas); and

e) in broad terms, the $50,000 lump sum has been expended in the following manner:

Payment to Centrelink $8390.60

Reimbursement of Medical Expenses $10,000

Payment of funeral and associated expenses re husband's death $10,000

Prepayment of mortgage expenses $18,000

Replacement of stove $1,100

Residual $3000 (approx)

(Applicant's evidence, Exhibit A10); and

f) the Applicant withdrew $20,000 of advance repayments on 31 December 1999 to pay for a replacement car ($12000) and a headstone for her husband's grave ($8000). A replacement car was required as an earlier vehicle had been written off following an accident, with the insurance company paying out $1800 to finalise the claim (Exhibit A4, A3); and

g) on the evidence provided the Applicant's capital position at the time of the hearing was:

House - solely owned with a mortgage outstanding of $33,321.60; a

repayment reserve of $70527.11 and a monthly required

repayment of $250 (Exhibit A3).

Car - no debt. Asset $12000 (Applicant's evidence).

Debts - $4000 owed to friends/relatives

Possible future commitments: operation nasal passages $4000

Roof repair $3960

(Applicant's evidence, Dr Havas); and

h) on the evidence provided the Applicant's annual income and

expenditure is of the following order (Exhibit A3, A11):

Annual income Annual outgoings

$12374.40 Mortgage $3000 - $3600 House Ins. $405.04 Council Rates $531.97 Water Rates $462.60 Electricity $956.68 Telephone $1609.06 Car insurance $1873.03 Pharmaceutical $250 School needs $250 Total $9339 - $9939

i) the Applicant felt obligated to make necessary funeral arrangements for her husband as a consequence of cultural, religious and social pressures (Applicant's evidence); and

j) the Applicant's daughter aged 19 suffers from asthma and allergies (Applicant's evidence); and

k) the compensation part of the Applicant's lump sum was $25,000 and the preclusion period had been established using this sum; and

l) the charge amount of $8390.60 had been incorrectly calculated and the correct charge amount for the nominated preclusion period of 1 August 1997 until 24 September 1998 was $7354.70 (T18, Exhibit R3).

20. The Tribunal, having made particular findings of fact, turns to a consideration of the relevant legislation. Section 17(1) of the Act defines a compensation affected payment to include "(b) a parenting payment".

21. The Tribunal further notes section 17(3) of the Act which states

"Compensation part of a lump sum

17(3) For the purposes of this Act, the compensation part of a lump sum compensation payment is:

a) 50% of the payment if the following circumstances apply:

(i) the payment is made (either with or without admission of liability) in

settlement of a claim that is, in whole or in part, related to a

disease, injury or condition; and

(ii) the claim was settled, either by consent judgement being entered

in respect of the settlement or otherwise, on or after 9 February

1998: or

(ab) 50% of the payment if the following circumstance apply:

(i) the payment represents that part of a person's entitlement to

periodic compensation payments that the person has chosen to

receive in the form or a lump sum; and

(ii) the entitlement to periodic compensation payments arose form the

settlement (either with or without admission of liability) of a claim

that is, in whole or in part, related to a disease, injury or condition;

and

(iii) the claim was settled, either by consent judgement being entered

in respect of the settlement or otherwise, on or after 9 February

1988; or

(b) if those circumstances do not apply - so much of the payment as is, in the

Secretary's opinion, in respect of lost earnings or lost capacity to earn."

24. The Tribunal notes the legislative requirements detailed to calculate the preclusion period and in particular subsections 1165 (2AA), 1165 (5), 1165 (8), 1165 (9) and 1165 (4C) which in turn state,

"Person member of a couple - payment received on or after 20 March 1997

1165(2AA) Subject to subsection (2B), if:

(a) a person receives or claims a compensation affected payment; and

(b) the person is a member of a couple; and

(c) the person receives a lump sum compensation payment (whether before of after the person receives or claims the compensation affected payment) on or after 20 March 1997;

no compensation affected payment is payable to the person for the new lump sum preclusion period.

...

1165(5) If periodic compensation payments are made in respect of the lost earnings or lost earning capacity, the new lump sum preclusion period is the period that:

(a) begins on the day after the last day of the periodic payment period; and

(b) ends after the number of weeks worked out under subsections (8) and (9).

...

1165(8) If a compensation lump sum is received on or after 20 March 1997, the number of weeks in the preclusion period is the number of worked out under the following formula:

Compensation part of lump sum

Income cut-out amount

1165(9) If the number worked out under subsection (4) or (8) is not a whole number, the number is to be rounded down to the nearest whole number.

...

1166(4C) If:

(a) the person is a member of a couple; and

(b) the person receives a lump sum compensation payment on or after 20 March 1997;

the recoverable amount is equal to the smaller of the following amounts:

(c) the compensation part of the lump sum compensation payment;

(d) the sum of the payments of the compensation affected payment made to the person for the new lump sum preclusion period."

23. Finally the Tribunal notes subsection 1184(1) of the Act which states

"1184(1) For the purposes of this Part, the Secretary may treat the whole of part of a compensation payment as:

(a) not having been made; or

(b) not liable to be made;

if the Secretary thinks it is appropriate to do so in the special circumstances of the case."

24. In turning to the calculation of the preclusion period, the Tribunal notes that the compensation part of the lump sum was $25,000 and this was in accordance with subsection 17(3)(a) if the Act. Further the Tribunal notes that subsection 1165(2AA) applies to the circumstances of this matter as the Applicant was a member of a couple at the time she received the lump sum compensation payment in February 1999. Further the Tribunal notes that subsection 1165(5) is the relevant subsection in establishing the preclusion period as the Applicant had been receiving periodic payments, with the mechanics of the calculation being defined in subsection 1165(8) and (9). As a consequence of these observations, the Tribunal finds that the preclusion period had been correctly calculated.

25. Section 1166(4C) details the recoverable amount as being the smaller of either the compensation part of the lump sum compensation payment ($25,000) or the sum of the payments of the compensation affected payments made to the Applicant for the lump sum period ($7354.70). The Tribunal finds that the latter amount is the smaller and again notes the earlier miscalculation that had made the charge amount $8390.60. Thus the Tribunal finds that in accordance with section 1166(4C) of the Act the amount recoverable from the Applicant is $7354.70.

26. In considering the matter of special circumstances, the Tribunal has established particular facts in paragraph 19, which can be best summarised under the following headings.

(a) Medical: (i) the Applicant has particular medical impairments, namely depression, a work related disability, asthma, allergies acid and high cholesterol. Further the death of her husband aggravated the depression and associated anxiety symptomatology, which required counselling and medication; and

(ii) the daughter aged 19 had a reactive depressive episode at the time of her father's death and increased symptomatology from the allergy and asthma. At the time of the hearing she was working three days a week and attending TAFE; and

(iii) the daughter aged 7 required some counselling at school at the time of her father's death, but otherwise is doing well at school; and

(iv) the Applicant is having difficulty is coping with the responsibilities of managing the financial affairs and adjusting after the death of her husband.

(b) Financial: (i) the Applicant has made a number of financial decisions which effect her financial capital circumstances. These include both discretionary expenditures such as associated funeral expenses ($4000), replacement car ($12000) and a headstone ($8000) and non-discretionary expenditures such as payment to Centrelink ($8390.60), medical expenses ($10,000) and funeral expenses and husband's overdraft ($10,000) and stove replacement ($1100). A repayment of $18000 of mortgage was replaced with a withdrawal of $20,000 from the same account to meet car and headstone expenses. Further the Applicant envisages a further discretionary expenditure of $4000 for nasal passage surgery and is anticipating an expenditure of $3960 to fix a roof; and

(ii) in relation to annual income and expenditure, the Applicant has detailed an annual income of $12374 and an expenditure before daily living expenses of $9939, arguing that the residual is insufficient to maintain herself and two dependent daughters; and

(iii) in relation to assets and liabilities, the Applicant is sole owner of a house, with a mortgage of $33321, requiring a servicing monthly payment of $250. Further it is to be noted that there have been advance payments of $70527, which are available to be drawn down. A car is wholly owned and a debt exists to friends and relatives of $4000; and

(iv) the daughter aged 19 is working three days a week, with any contributions to the family financial affairs being minimal.

(c) Social/Custom:

(i) the Applicant portrayed the dependency she had on her late husband and indicates the difficulty she has coping with the running of her domestic and financial affairs; and

(ii) many expenses associated with the Applicant's late husband's funeral were a result of social, personal, religious and cultural factors.

27. In considering the issues surrounding special circumstances, the Tribunal notes the following cases, as discussed in the Resondent's statement of facts and contentions (Exhibit R1). In Re Green and Secretary, Department of Social Security (1990) 21 ALD 772 Senior Member Barnett stated:

"The decision maker must have regard to whether, by exercising the discretion in a particular case, he will be achieving or frustrating end or objects which are conformable with the scope and purpose of the Social Security Act."

Re Beadle and Director-General of Social Security (1984) 6 ALD 1 Toohey J said

"An expression such as "special circumstances" is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend on the context in which they occur. For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special".

Following this, the Full Federal Court in Beadle v Director-General of Social Security(1985) 7 ALD 670 considered that:

"The phrase "special circumstances", although lacking precision, is sufficiently understood in our view not to require judicial gloss."

Similar views were adopted in Kryzwak and Secretary, Department of Social Security (1998) 15 ALD 690 and Stevens and Secretary, Department of Social Security (1989) 18 ALD 659.

In Re Colaiacolo and Secretary, Department of Social Security (AAT 2109, 24 April 1985) the Tribunal stated that the factor of financial hardship alone is not sufficient to amount to special circumstances unless it is "exceptional" and not merely "straitened".

28. The Tribunal notes that in this matter the Respondent has exercised the discretion to treat $10,000 from the lump sum of $50,000 as being expenses associated with the death of her husband - this event being considered to be unforseen and unusual in the circumstances. Accordingly a new preclusion period of 48 weeks has been calculated commencing on 1 August 1997 and extending to 2 July 1998. As a result of this new preclusion period, the amount of charge calculated is $5612.40. the Tribunal acknowledges this concession and so finds that a sum of $10,000 of the compensation payment is to be disregarded, in that such an amount is treated as not having been made. As a consequence the Tribunal having earlier found an error in the calculation of the charge amount, now finds that the Applicant is further owed an amount of $1742.30 making in total an amount owed to the Applicant of $2778.20.

29. In considering the other nominated circumstances, both individually and collectively, the Tribunal finds that for the following reasons they do not constitute special circumstances

(a) the financial affairs of the Applicant are the creation of her own decisions. In the Tribunal's view, the only non-discretionary expenditures from the compensation payments, were payments to the Respondent ($8390.60), funeral and associated expenses ($10,000), medical expenses ($10,000) and stove replacement ($1100). All remaining expenditures are in the Tribunal's view discretionary and non-necessitous and these include replacement car purchase ($12000) and headstone ($8000). A Further anticipated expenditure is nasal surgery with the election to be done privately at the cost of $4000 as opposed to being done publicly at Bankstown Hospital, is considered by the Tribunal to be a discretionary, non-necessitous expenditure; and

(b) further, the Tribunal is of the opinion that discretionary capital purchases such as the car purchase are impacting of the Applicant's discretionary annual expenditure, by way of insurance ($1800), registration and third party ($800), and other operating costs which are not recognised in the Applicant's annual expenditure statement. The Tribunal observes that annual telephone expenses are at a level of usage that could bear some reduction; and

(c) in overview it is the Tribunal's view, that while the financial circumstances of the Applicant are tight, if appropriate financial decisions are affected by the Applicant which places financial requirements for necessities and daily living expenses as a priority, and that capital purchases are undertaken on what can be afforded, as opposed to what is desirable and that the consequences of capital purchasing annual expenditures are appreciated prior to the purchase of a capital item, then preservation of the Applicant's current satisfactory financial capital position will be maintained; and

(d) in essence the Tribunal is stating that the current financial circumstances with which the Applicant has to contend are, apart from the death of her husband, matters of her creation and that unless there is recognition by the Applicant of the need to scrutinise expenditure against need and availability of funds as opposed to personal preference, custom or social expectation, her financial situation will continue to deteriorate, by way of erosion of a current satisfactory capital situation; and

(e) the Tribunal acknowledges the particular mental and physical impairments of the Applicant, but in essence, whether considered alone or in combination with the medical circumstances of the two dependent daughters and coupled with the worries surrounding her financial situation, the Tribunal concludes that these circumstances are not unusual, uncommon or exceptional, and certainly they do not have a particular quality of unusualness that permits them to be described as special; and

(f) finally the Tribunal, in acknowledging the social, cultural and religious pressures and customs placed upon the Applicant, concludes that any expenditure undertaken as a result of the pressures must be taken in the context of what can be afforded. Again the Tribunal, in recognising that a rational approach may not necessarily be in existence at the time of grieving, and that what may be ordered is also subject to cultural influence, believes that in this matter there has been an acknowledgment of such by the decision to exercise a discretion to treat $10,000 of the compensation payment as not have been made. This $10,000 reflects the expenditure made by the Applicant on funeral and associated expenses for her late husband.

DETERMINATION:

30. The Tribunal sets aside the decision under review and in substitution thereof finds that:

(a) the charge for the preclusion period had been incorrectly calculated; and

(b) a sum of $10,000, being part of a compensation payment, is treated as not having being made; special circumstances have been found to exist as relating to the death of the Applicant's husband and particular expenditure arising there from; and

(c) the Applicant is entitled to a repayment of $2778.20, arising from the circumstances nominated in (a) and (b).

I certify that the 30 preceding paragraphs are a true copy of the reasons for the decision herein of DR J CAMPBELL

Signed: .....................................................................................

Associate

Date/s of Hearing 25 January 2000

Date of Decision 9 June 2000

Solicitor for the Applicant Self respresented

Solicitor for the Respondent Sue Fahey