Murray and Department of Family and Community Services [2000] AATA 499 (2 June 2000)

Last Updated: 3 July 2000

DECISION AND REASONS FOR DECISION [2000] AATA 499

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q2000/176

GENERAL ADMINISTRATIVE DIVISION )

Re ANNE MURRAY

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Dr E K Christie, Member

Date 2 June 2000

Place Brisbane

Decision The decision under review is set aside and in substitution thereto the Tribunal decides to waive the whole of the debt accrued over the period 24 June 1999 to 15 September 1999 under the special circumstances provision of the Social Security Act 1991. The waiver is to take effect on 16 September 1999. This means that Mrs. Murray's application for review is successful.

.........Signed.....................................

DR E K CHRISTIE

MEMBER

CATCHWORDS

SOCIAL SECURITY - Partner Allowance - overpayment -whether appropriate to waive debt because of 'special circumstances' or 'administrative error'.

Social Security Act 1991: ss1237A, 1237AAD

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

Re Callaghan and Secretary, Department of Social Security (1996-1997) 45 ALD 435

ORAL REASONS FOR DECISION

2 June 2000 Dr E K Christie, Member

1. This is an application by Anne Murray to review a decision of the Social Security Appeals Tribunal ("the SSAT") made on 27 January 2000 to raise and to recover an overpayment of Partner Allowance ("PA") paid to Mrs. Murray over the period 24 June 1999 to 15 September 1999. The amount of overpayment, as agreed by the parties at the hearing before the Tribunal was $1107.62. The SSAT decision had affirmed an earlier decision of an Authorised Review Officer made on 20 October 1999.

2. In reaching its decision the SSAT concluded that there were no grounds to waive the debt on the basis of administrative error. However, the SSAT hearing failed to consider and determine whether the overpayment could be waived because of 'special circumstances'.

3. The applicant represented herself at the hearing. The respondent was represented by Ms. J. Dwyer, a Departmental Advocate.

4. At the hearing, the Tribunal had in evidence before it documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 - the "T" documents (Exhibit 1) and the following exhibits:

* Exhibit 2 - Centrelink documents forwarded to Mrs. Murray

* Exhibit 3 - Centrelink documents forwarded to Mr. Murray

ISSUES BEFORE THE TRIBUNAL

5. The only issues for the Tribunal to decide were whether the overpayments of PA could be waived, in part, or in full under the (a) "administrative error" or (b) "special circumstances" provisions of the Social Security Act 1991 ("the Act").

FACTS

6. At the hearing, Mrs. Murray acknowledged the following findings of fact made by the SSAT, subject to the qualifications set out in paragraphs 7 and 8 below:

"(i) Mrs Murray was in recept of partner allowance.

(ii) On 6 May 1999, a notice was sent to Mrs Murray that required her to notify Centrelink if the fortnightly income of $10.64 is incorrect.

(iii) Mrs Murray relied on Mr Murray (her husband) to declare her fortnightly income on his newstart allowance income statement.

(iv) On 24 June 1999, Mr Murray received a notice that he needed only to return his newstart allowance form every 12 weeks.

(v) Mrs Murray did not notify Centrelink of her earnings for the period 24 June 1999 to 15 September 1999.

(vi) On 15 September 1999 Mr Murray advised Centrelink that Mrs Murray had earned $1619.56 for the period 24 June 1999 to 15 September 1999."

7. In response to SSAT finding (iii), Mrs. Murray said that at no stage had Centrelink provided her with a form which she could directly advise them of her income.

8. In response to SSAT finding (vi), Mrs. Murray said that she had advised Centrelink of her income at the end of the twelve week review period.

CONTENTIONS AND SUBMISSIONS OF THE PARTIES

9. Mrs. Murray made the following submissions:

* that at no stage had she received a follow-up letter from Centrelink to inform her that she was receiving PA entitlement of $52.98;

* that the Centrelink notification notice (T6, 6 May 1999) stated that she was to receive PA payment $146.70 for 6 to 12 May 1999. However, at no stage did she receive this but instead the amount received was $52.98. She submitted that Centrelink must have had access to her true earnings.

* that she had been advised, after the overpayment period, that there was no reason for her husband to come within a 12 week lodgement period for his NSA;

* that she did not query the 12 week lodgement review period because she thought it applied because her husband was doing voluntary work for the Holy Spirit Hospital;

* that she thought she had met her social security obligations by advising Centrelink at the end of the 12 week period;

* that a first interview with Centrelink had not taken place; nor had any information, written advice or brochures been provided by Centrelink to inform her, as a PA recipient, of the implications for her or her husband coming within a twelve week NSA review period ;

* furthermore, no advice had been sent to her as to how the 12 week NSA review period would affect her entitlement and the amount of her entitlement;

* that because she continued to work in her job, at much the same number of hours, and earned about the same amount of income, she had no reason to notify Centrelink. She had calculated her income on an averaging basis and this had only showed very small variation over time;

* that no forms had been sent directly to her by Centrelink to seek her income details. Consequently, she had to rely on her husband's form. However, after the 12 week overpayment period, Centrelink had sent her forms to provide income details (Exhibit 2);

* that advice she received after the overpayment period, was that her husband should never have been placed on a 12 week NSA lodgement; and

* that if she had been provided with the necessary forms for her income details by Centrelink, or her husband had not been placed on a 12 week lodgement, the overpayment would not have occurred.

10. Ms. Dwyer, the Departmental Advocate made the following submissions:

* that Mrs. Murray had received a Centrelink notification notice on 6 May 1999 (T6) which required her to contact Centrelink if her partner's income of $10.64 was incorrect;

* that Mrs. Murray relied on Mr. Murray to declare her income on his Newstart Allowance form, lodged with Centrelink on a fortnightly basis. (Examples at T7, T8, T9, Folios 44-49);

* that Mr. Murray received a notice on 24 June 1999 (T10, Folio 50), advising that his NSA forms would now be lodged on a 12 weekly basis and notifying him that any changes in circumstances were required to be notified within 14 days;

* that Mrs. Murray had not advised Centrelink of her income for the period 24 June 1999 to 15 September 1999. Payment of Partner Allowance increased from $106.35 to $293.80 (T14, Folio 57);

* that Mr. Murray advised of Mrs. Murray's income on 15 September 1999 (T11, Folios 53,54);

* that because Centrelink was not advised of Mrs. Murray's current income after 24 June 1999 by either Mr. or Mrs. Murray, a recoverable debt of Partner Allowance existed under Section 1224. Alternatively, a debt arose pursuant to Section 1223(5) as the correct rate of Partner Allowance had not been paid to Mrs. Murray;

* that the debt was not caused solely by administrative error. Therefore, waiver of the debt under Section 1237A was not applicable. Whilst, Centrelink had contributed to the administrative error by a change in the NSA lodgement cycle for Mr. Murray, Mrs. Murray had also contributed to the error by failing to respond to the notification notice Centrelink sent to her on 6 May 1999 (T6). Moreover, the PA payments received by Mrs. Murray were not received in "good faith" according to the meaning of "good faith" defined in Secretary, Department of Education, Training and Youth Affairs and Prince (1988) 152 ALR 127 as Mrs. Murray was aware the payments were being paid to her (see T4, Folio 57); and

* that there was nothing in the facts to justify the description of "unusual", "uncommon" or "exceptional" and so enable the debt to be waived under the "special circumstances" provisions of the Act.

11. In response to a Tribunal question, Ms. Dwyer acknowledged that in the circumstances of Mr. Murray's NSA, he should have remained on fortnightly, not 12 weekly lodgements.

CONSIDERATION OF THE ISSUES

12. The objective of the Tribunal is to review administrative decisions, not only on their merits, but in accordance with the law at all times. The relevant legislation is the Act.

13. The Tribunal has considered the credibility of Mrs. Murray and the veracity of her account as to her dealings with Centrelink. I accept Mrs. Murray acted honestly in all her dealings with Centrelink and her account to be consistent over time.

14. Section 1237 of the Act provides for circumstances where a debt due by a recipient of social security to the Commonwealth, may be waived:

"SECTION 1237A - WAIVER OF DEBT ARISING FROM ERROR

1237A(1) Administrative error. Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.

Note: Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).

SECTION 1237AAD - WAIVER IN SPECIAL CIRCUMSTANCES

1237AAD 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 or the 1947 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."

15. The first question for the Tribunal to decide is whether the debt should be waived because of the "special circumstances" provisions of the Act. The leading case is Re Beadle v Director-General of Social Security (1984) 6 ALD 1 where the Tribunal said at page 3:

"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 upon 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."

16. The Tribunal concludes that the circumstances in which the overpayment of family allowance entitlements were paid to Mrs. Murray were sufficiently "unusual", "uncommon" or "exceptional" to justify the description "special circumstances" because of:

* the lack of oral or written advice or information provided to Mrs. and Mr. Murray as to the implications of a change from fortnightly to a 12 week lodgement for NSA for Mr. Murray ie implications with respect to Mrs. Murray's PA payments;

* the failure of Centrelink to provide any explanation for the reason why Mr. Murray was to be placed on 12 week NSA lodgement review. The effect of this, and the lack of advice generally, was to place Mrs. Murray in a state of uncertainty - possibly confusion as to her obligations;

* acknowledgement by the Departmental Advocate that in the circumstances Mr. Murray should have remained on fortnightly lodgements;

* no forms had been sent to Mrs. Murray by Centrelink during the 12 week overpayment period - yet such forms had been sent to her to complete, subsequent to the overpayment period (Exhibit 2);

* that on the balance of probabilities, Mrs. Murray had no reason to advise of a change in her income over the 12 week overpayment period as her oral evidence was that it had showed little change - based on the average income amount she had calculated. The Tribunal makes the observation that Mrs. Murray's oral evidence is supported by statements in Mr. Murray's NSA forms which he had completed over time specifying Mrs. Murray's income as:

- T7 Folio 45 12 May 1999 - $345.88

- T8 Folio 47 25 May 1999 - $340.00

- T9 Folio 48 9 June 1999 - $340.00; and

* that as first time clients of Centrelink that in all probability there had been a breakdown of communication in advice and procedures provided to her by Centrelink for dealing with a change in circumstances as a recipient of PA.

17. The Tribunal considers that in the context of all the above circumstances in paragraph 16, that they represent "unusual" - certainly "uncommon" features of a client/Centrelink relationship so as to warrant the description of "special circumstances".

18. The Tribunal also finds that in applying the facts in paragraph 16, to the principles set out in Re Callaghan and Secretary, Department of Social Security (1996-1997) 45 ALD 435, that Mrs. Murray has not "knowingly" failed to comply with a provision of the Act.

19. Accordingly, the Tribunal concludes that the whole of the debt accrued over the 12 week overpayment period of $1107.62 be waived under the "special circumstances" provisions of the Act.

20. Given this finding, the Tribunal has no need to consider the question whether the PA overpayment should be waived because of administrative error.

21. Based on the above reasons, the Tribunal sets aside the decision under review and in substitution thereto decides to waive the whole of the debt accrued over the period 24 June 1999 to 15 September 1999 under the special circumstances provisions of the Act. Under s.1237(2) of the Act, the waiver is to take effect on 16 September 1999. This means Mrs. Murray's application for review is successful.

I certify that the 21 preceding paragraphs are a true copy of the reasons for the decision herein of Dr E K Christie, Member

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

R. Hayes, Associate

Date/s of Hearing 2 June 2000

Date of Decision 2 June 2000

Applicant Mrs. Murray, herself

Respondent Ms. J. Dwyer, Departmental Advocate