Crawford and Secretary, Department of Family and Community Services [2002] AATA 4 (9 January 2002)

Last Updated: 11 January 2002

DECISION AND REASONS FOR DECISION [2002] AATA 4

ADMINISTRATIVE APPEALS TRIBUNAL )

) No W2000/371

GENERAL ADMINISTRATIVE DIVISION )

Re DANIEL CRAWFORD

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Associate Professor S D Hotop, Senior Member

Date 9 January 2002

Place Perth

Decision The Tribunal affirms the decision under review.

...........(sgd S D Hotop)....................

Senior Member

CATCHWORDS

SOCIAL SECURITY - newstart allowance - applicant suffered work injury - applicant in receipt of newstart allowance - applicant received compensation amount - applicant subsequently notified DSS of compensation payment - compensation debt - DSS issued recovery notice to applicant - applicant had meanwhile spent compensation moneys - whether compensation debt should be waived - whether special circumstances - whether compensation debt should be written off.

Social Security Act 1991 ss 1236, 1237AAD

Re Ivovic and Director-General of Social Services (1984) 3 ALN No 61

Secretary, Department of Social Security v Hales (1998) 82 FCR 154

REASONS FOR DECISION

9 January 2002 Associate Professor S D Hotop, Senior Member

1. Daniel Crawford ("the applicant") has applied to the Tribunal for a review of a decision of the Social Security Appeals Tribunal ("SSAT"), dated 4 September 2000. In that decision the SSAT found that the applicant owed a compensation debt to the Commonwealth, in the amount of $10,910.38 by way of payments of newstart allowance received by him in the period from 16 November 1995 to 13 December 1996, but decided that the balance of that debt owing as at the date of the SSAT hearing be written off pursuant to s 1236(1) of the Social Security Act 1991 ("the Act").

2. At the hearing the applicant was represented by Mr P O'Donoghue, an advocate with the Welfare Rights & Advocacy Service, and the Secretary to the Department of Family and Community Services ("the respondent") was represented by Mr A Jones, a Centrelink advocate. The Tribunal had before it the documents (" T documents") lodged by the respondent in accordance with s 37 of the Administrative Appeals Tribunal Act 1975 and various exhibits tendered in evidence by the applicant (Exhibits A1 - A9) and by the respondent (Exhibit R1). The applicant gave oral evidence by telephone from New Zealand. There were no other witnesses.

The Factual Background

3. The relevant background facts, about which there is no dispute between the parties and as found by the Tribunal on the basis of the T documents and exhibits, are as follows.

4. The applicant, who was born in New Zealand on 16 April 1967 sustained a work-related injury on or about 15 March 1995 in Western Australia.

5. On or about 18 April 1995 the applicant lodged with the (former) Department of Social Security ("DSS") a claim for newstart allowance, a "Module C" Compensation and Damages form and an accompanying statement in which he confirmed that he was claiming workers' compensation in respect of the abovementioned injury and stating that he understood that his compensation claim would have to be "cleared" with the compensation section of the DSS before his claim for newstart allowance could be assessed and that he would notify the DSS of any changes in his circumstances that might affect his entitlement to newstart allowance. (T4, T5)

6. The applicant subsequently received weekly payments of compensation for the period from 20 March 1995 to 1 May 1995, and during that period he was also in receipt of newstart allowance. The DSS subsequently recovered from the relevant insurer, MMI, the amount of $303.33 which had been paid to the applicant by way of newstart allowance during the abovementioned period.

7. The applicant was also in receipt of newstart allowance from 1 August 1995 to 13 December 1996.

8. On 24 June 1996 the applicant lodged a statement with the DSS in which he stated, inter alia, that he understood that "if anything changes" he would notify the DSS within 2 weeks. (T7)

9. On 16 December 1996 the applicant received from MMI a cheque in the amount of $15,974.40 representing arrears of weekly payments of compensation from 16 November 1995. (Exhibit A1)

10. On 29 April 1997 the applicant lodged with the DSS a new claim for newstart allowance. In the claim form the applicant responded "Yes" to the question:

"Have you received any compensation or damages payments since 1 May 1987 as a result of an injury or illness, or are you receiving any compensation or damages payment as a result of an injury or illness?".

(Exhibit A2)

In a "New Claim Action Sheet", completed by a DSS officer in response to the applicant's claim for newstart allowance, it was indicated that a "compensation clearance" was not required. (Exhibit A3)

11. On 28 July 1997 the applicant lodged with the DSS a further claim for newstart allowance. In the claim form the applicant responded "Yes" to the question:

"Have you ever claimed or are you entitled to claim compensation or damages from any accident or injury?"

(Exhibit A4)

12. On 30 July 1997 the applicant lodged with the DSS a "Module C" Compensation and Damages form in which he indicated that he had claimed workers' compensation as a result of a work injury in March 1995, had received an amount of $15,000 (sic) in settlement of that claim in December 1996 and had also been in receipt of weekly payments of compensation which had ceased on 10 March 1997. (T8)

13. On 1 August 1997 a delegate of the Secretary to the DSS sent to the applicant a Recovery Notice under s1170 of the Act stating that, on the basis that the applicant had received weekly compensation payments for the period from 16 November 1995 to 10 March 1997 totalling $24,963.54, and had received social security payments for the period from 16 November 1995 to 13 December 1996 totalling $10,910.38, the amount of $10,910.38 was to be recovered from the applicant pursuant to s1170. (T10)

14. On 29 July 1999 the applicant requested an internal review of the abovementioned decision to recover the debt from him and the applicant was notified by an officer of Centrelink, by letter dated 13 September 1999, that the officer had reviewed the matter and had found that the original decision was correct. (T13, T16)

15. Following a request by Mr P O'Donoghue, on behalf of the applicant, for a further internal review of the abovementioned decision, an Authorised Review Officer notified Mr O'Donoghue, by letter dated 8 June 2000, that he had affirmed that decision. (T25)

16. Following an application to the SSAT for a review of the abovementioned decision, lodged by Mr O'Donoghue on behalf of the applicant, the SSAT, on 4 September 2000, decided, pursuant to s 1236(1) of the Act, to write off the balance of the abovementioned compensation debt owing by the applicant as at the date of the hearing, namely, 20 July 2000. (T2)

17. On 10 October 2000 Mr O'Donoghue, on behalf of the applicant, lodged with this Tribunal an application for review of the SSAT's decision of 4 September 2000. (T1)

The applicant's evidence

18. The applicant gave oral evidence by telephone from New Zealand where he now resides with his mother.

19. In his examination-in-chief the applicant confirmed that he had sustained a work-related condition - namely, carpal tunnel syndrome in both hands - in March 1995 while working as a slaughterman at an abattoir in Western Australia. He said that he was initially off-work for 4 weeks, during which he was in receipt of newstart allowance, and that he then returned to work on light duties. He said that he subsequently quit that job and commenced work at a different abattoir but that employment ceased after a 1-week trial period and he again applied for, and received, newstart allowance. He said that he made a claim for workers' compensation and that he informed the DSS of this when he applied for social security. He confirmed that in mid 1995 he received a small sum by way of compensation after the DSS had recovered an amount of social security paid to him. He said that for about the next 18 months he lived on social security until a further payments of workers' compensation was made to him in December 1996.

20. The applicant told the Tribunal that he returned to New Zealand in December 1996 for 2 weeks to be with his mother after his step-father's death. He said that during that period the workers' compensation insurer, MMI, settled his compensation claim and a cheque from MMI was waiting for him when he returned to Perth. He said that about $7,000.00 had been taken out of the amount of compensation payable to him and that he assumed that the DSS had recovered that amount from MMI as it had done in mid 1995 (see preceding paragraph). He confirmed that the amount of the cheque which he received from MMI in December 1996 was about $16,000.00.

21. The applicant told the Tribunal that the spent most of the $16,000.00 on gambling, and the rest on "booze", "a bit of dope", rent and living expenses. He said that after about 3 months he went to Karratha (in Western Australia) in order to work and he obtained casual employment in Karratha "on and off" for about one year. He confirmed that, while in Karratha, he claimed newstart allowance at the local DSS office. He said that he notified the DSS that he had received a compensation payment. Asked when he first became aware that Centrelink (formerly, the DSS) claimed that he owed a debt by reason of social security payments previously made to him, the applicant said that he received a letter from Centrelink to that effect while he was in Karratha (see T10, dated 1 August 1997). He said that at first he was not concerned about this matter because he thought that Centrelink had already recovered the debt from his compensation settlement but that he realised it was a serious matter when Centrelink commenced to garnishee amounts from his bank account.

22. The applicant confirmed that he had been admitted to Graylands Hospital in late 1999 and his condition was diagnosed as "drug induced psychosis". He said that at that time he felt he was being persecuted and that a lot of things were "stressing [him] out", including Centrelink's actions in recovering the debt from him. Documents relating to the applicant's stay in Graylands Hospital were tendered in evidence (Exhibit A9).

23. The applicant said that, following his discharge from

Graylands Hospital, he returned to New Zealand on Christmas Day, 1999. He said that since his return to New Zealand he has been living with his mother and "on and off" with his girlfriend. He told the Tribunal that he is part Maori and that he has a "half-brother" and a sister in New Zealand.

24. The applicant said that he has been receiving treatment at a community mental health service in New Zealand on a regular basis approximately every fortnight. A letter from Dr F Rawlinson, Visiting Psychiatrist, Tararua Community Mental Health Service, dated 27 February 2001, was tendered in evidence by the applicant (Exhibit A8). That letter states:

"This is to certify that Mr Crawford has recently had an acute relapse of his Paranoid Schizophrenic illness. He is starting to improve & recover from this relapse, but remains extremely brittle. He has been instructed to remain off work & to eliminate all stress where possible. Any undue stress is likely to cause a further deterioration in his mental state which is not in his interest medium to long term."

25. The applicant told the Tribunal that, since returning to New Zealand 2 years ago, he has worked for a total period of about 6 months. He said that he has obtained seasonal work as a slaughterman during that period and that he had just commenced a new job as a slaughterman, working 4 days per week. He said that his present lifestyle is "pretty quiet" and that nowadays he does not gamble much and does not drink alcohol or smoke marijuana. As regards his financial circumstances, he said that he has no assets, is presently paying off a child support debt (the present balance of which is about $3,000.00), and has $95.00 in the bank.

26. In cross-examination the applicant reiterated that when he applied for newstart allowance in April 1995 he filled in some forms in which he notified the DSS that he had claimed workers' compensation but that he had not yet received any compensation. He also confirmed that when he re-applied for newstart allowance in Karratha in July 1997 he also filled in some forms in which he notified the DSS that he had received a compensation amount in December 1996. When asked by Mr Jones (for the respondent) whether he provided information to the DSS regarding his compensation between April 1995 and July 1997, the applicant said:

"I informed that (sic) I was going to get comp (sic) or that I was going on compo. I never had any compensation payment and they made me fill out forms, you know, basically to say that they would get repayment from the compensation claim before I got it. And then the second time in '97 was when I had to fill out more forms and they had just asked if I had received compensation payments of any sort of share of too (sic), I think it was and I said: yes, I had received it but the first time I hadn't received anything so."

(Transcript, p25)

The following exchange then occurred between the Tribunal and the applicant:

"Could I just ask you then, Mr Crawford, it is correct that you received the compensation claim, or the amount, in December '96 but you didn't advise the DSS at that time when you received it? --- Yes, I went in and told them that I had - because I went and signed off the dole and went and told them I had received my compensation.

And you did that when?---As soon as I got back from New Zealand.

And when was that?---It would have been just after Christmas.

Right, so still round about late December '96, is that what you're saying?---Yes, it would have been around then.

So, shortly, within a few weeks after you received the amount?---Yes."

(Transcript, p26)

In response to questions asked by Mr Jones the applicant then gave the following evidence:

"In regards to you going back to New Zealand in late 1996, did you tell Centrelink that you were going back to New Zealand?---I think - yes, I did.

Okay, so Centrelink would have cancelled you because you were going back to New Zealand?---I can't remember what happened.

Why did you tell Centrelink you were going back to New Zealand?---To see if they would just hold my dole payments because I was only coming over for 2 weeks so didn't want my dole payments to stop.

Did you know you were going to receive the compensation payment at that time?---No, I didn't. I only found out when I was - I got a phone call from a mate in Perth and when I got back from New Zealand I went into the Social Security and told them I had received my cheque and I don't need dole payments any more anyway and - - -".

(Transcript, p27) Mr Jones informed the Tribunal that the last relevant payment of newstart allowance made to the applicant covered the period ending 13 December 1996.

27. The applicant also told the Tribunal that, by the time he was first notified by Centrelink in early August 1997 regarding the relevant compensation debt owed by him, he had spent most of the compensation amount of approximately $16,000.00 received by him in December 1996. Indeed, he said that he had spent most of that money within about 3 months of his receiving it and, because he had only a small amount left, he then went to Karratha looking for work. Asked by the Tribunal how, if he had known beforehand that Centrelink would be seeking to recover about $11,000.00 of the compensation amount of about $16,000.00 paid to him, it would have affected his approach to spending that money, he said:

"I would have paid Centrelink."

(Transcript, p 40)

He also agreed that having such knowledge would have affected his approach to spending that money and he added:

"But I thought they [Centrelink] had already taken their money out."

(Transcript, p 40)

Evidence tendered by the respondent

28. Mr Jones (for the respondent) tendered in evidence an e-mail communication, dated 12 October 2001, from Tamara McCudden, Compensation Section, Centrelink (Exhibit R1). The contents of that e-mail communication are as follows:

"I have reviewed the process that has occurred in the case of Mr Daniel Jens CRAWFORD...

Mr Crawford claimed Social Security income support April 1995 after suffering work injury March 1995. The compensation claim was declared and MMI held our notices on file.

A closed period of w/comp was paid to customer 20/03/195 (sic) to 28/04/95 and Centrelink recovery $303.33 made.

After this closed period of w/comp MMI denied further compo claim and after 4 months Centrelink closed system record and issued Release Notices 10/10/95 as a matter 'no further claim' or 'no enforceable claim'.

Confirmed with Allianz today that as MMI they were ordered by Workcover-Conciliations to pay arrears of w/comp in Dec 1996 for payments Nov 1995 to Dec 1996 and ongoing to March 1997, when final medical certificate was filed. This confirms claims liability was declined after initial closed period of w/comp was paid.

Mr Crawford made Centrelink claims in April and July 1997 and both times he did declare his compensation claim, with evidence of compensation clearance on the July claim. At this point Centrelink became aware that compensation claim was eventually accepted for further w/comp payments and compensation charges were calculated based on details provided by MMI.

Charge was sent to Mr Crawford as no legal responsibility for MMI to advise of w/comp at time accepted, or to repay charge as per Release notice October 1995.

The Centrelink compensation file was closed in October 1995 as MMI advised further claim declined. Finalisation was discretionary decision of assessor and was based on details of compensation claim at that time ie; that there was no further accepted claim with MMI.

...".

The Issue

29. It is common ground that the applicant owes a compensation debt to the Commonwealth pursuant to s 1170 of the Act. It is also common ground that the original amount of that debt was $10,910.38, but Mr Jones informed the Tribunal that the present balance of that debt is $9,189.78. The only issue for the Tribunal's determination is whether that debt should be written off pursuant to s 1236(1) of the Act or whether the Commonwealth's right to recover all or part of that debt should be waived pursuant to s 1237AAD of the Act.

The Relevant Legislation

30. The relevant provisions of the Act are as follows:

"1236(1) Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.

1236(1A) The Secretary may decide to write off a debt under subsection (1) if, and only if:

(a) the debt is irrecoverable at law; or

(b) the debtor has no capacity to repay the debt; or

(c) the debtor's whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or

(d) the debtor is not receiving a social security payment under this Act and it is not cost effective for the Commonwealth to take action to recover the debt.

1236(1B) For the purposes of paragraph (1A)(a), a debt is taken to be irrecoverable at law if, and only if:

(a) the debt cannot be recovered by means of deductions from a person's youth training allowance, or legal proceedings, or garnishee notice, because the relevant 6 year period mentioned in section 1231, 1232 or 1233 has elapsed; or

(b) there is no proof of the debt capable of sustaining legal proceedings for its recovery; or

(c) the debtor is discharged from bankruptcy and the debt was incurred before the discharge and was not incurred by fraud; or

(d) the debtor has died leaving no estate or insufficient funds in the debtor's estate to repay the debt.

1236(1C) For the purposes of paragraph (1A)(b), if a debt is recoverable by means of deductions from a person's social security payment, the person is taken to have a capacity to repay the debt unless recovery by those means would cause the person severe financial hardship.

...

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 the1947 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."

The Submissions

31. Mr O'Donoghue (for the applicant) submitted that the relevant compensation debt should be waived pursuant to s 1237AAD of the Act because of special circumstances which existed in this case and which made it desirable to waive that debt. In support of that submission Mr O'Donoghue adverted to the following circumstances of the applicant's case:

* the serious decline in the applicant's mental health in late 1999 (as evidenced by Exhibit A9), which coincided with the garnishee action taken by Centrelink to recover the debt from him, and the seriousness of his present condition (as evidenced by Exhibit A8);

* the applicant's adverse financial circumstances, namely, the fact that he has no assets, no significant savings, and, in addition to the compensation debt, an outstanding child support debt of about $3,000.00;

* the applicant has experienced long-term unemployment and, although he has now found part-time seasonal employment, his future employment prospects are poor;

* the applicant's honest and reasonable, but mistaken, belief, based on previous experience, that the DSS had already recovered the relevant amount of social security payments from MMI before he received from MMI the compensation amount of $15,974.40 in December 1996;

* the DSS's failure to act in a timely manner to recover the compensation debt from the applicant after he informed the DSS in December 1996 that he had received the relevant compensation amount;

* by reason of the applicant's abovementioned mistaken belief and the DSS's failure to take recovery action in a timely manner, the applicant made certain choices regarding the spending of the compensation amount that he would not otherwise have made; on the contrary, had he been made aware by the DSS in a timely manner that he owed a compensation debt, he would have discharged that debt before spending the compensation moneys;

* it is more appropriate to waive, than to write off, the compensation debt because the continued existence of that debt will be injurious to the applicant's already fragile mental health and adversely affect his prospects of recovery, both mentally and financially.

32. Mr Jones (for the respondent) submitted that the decision of the SSAT, that the balance of the applicant's compensation debt be written off, should be affirmed. As regards waiver of that debt, Mr Jones submitted that the circumstances of the applicant's case were not such as would make it appropriate to waive that debt. In particular, Mr Jones submitted that the Tribunal should not accept the applicant's evidence that he notified the DSS of his compensation payment shortly after he received it in December 1996, there being no official record or any other documentary evidence to support that assertion. Mr Jones acknowledged that there was documentary evidence to support the fact that the applicant notified the DSS of his compensation payment when he applied for newstart allowance in April 1997 and that the DSS did not act on that advice (see Exhibits A2 and A3), but he submitted that that omission by the DSS did not cause the debt to arise, nor did it financially disadvantage the applicant because, according to his own evidence, he had by that time already spent the compensation moneys. Finally, Mr Jones submitted that the overall circumstances of the applicant's case - including his profligate spending of the compensation moneys, his poor mental health as a result of alcohol and drug misuse, and his adverse financial circumstances - did not constitute special circumstances such as would make it desirable and appropriate to waive the compensation debt pursuant to s 1237AAD of the Act.

Consideration and Findings

33. Section 1237AAD of the Act confers a discretionary power to waive the Commonwealth's right to recover the whole or a part of a debt (including a compensation debt) that is recoverable under Part 5.2 of the Act. The existence of that power is, however, conditional upon the repository of that power (in this case, the Tribunal) being satisfied as regards the matters referred to in paras (a), (b) and (c) of s 1237AAD. It is common ground that the matter referred to in para (a) is satisfied in this case. The respondent contends, however, that the matters referred to in paras (b) and (c) are not satisfied in this case.

34. The matter referred to in para (b) of s 1237AAD of the Act is the existence of "special circumstances (other than financial hardship alone) that make it desirable to waive" the right to recover the debt. As regards the matter referred to in para (b) in particular, and s 1237AAD of the Act in general, French J said in Secretary, Department of Social Security v Hales (1998) 82 FCR 154 at 162:

"The concept of special circumstances is broad. A constellation of factors, including financial circumstances, may fall within it. ...

The evident purpose of s1237AAD is to enable a flexible response to the wide range of situations which could give rise to hardship or unfairness in the event of a rigid application of a requirement for recovery of debt."

Before exercising the power conferred by s 1237AAD in the present case the Tribunal must be satisfied that there are special circumstances (other than financial hardship alone) by reason of which recovery of the debt due by the applicant to the Commonwealth would be "unjust, unreasonable or otherwise inappropriate": Re Ivovic and Director-General of Social Services (1984) 3 ALN No 61 at p N97.

35. As regards the circumstances of the applicant's case referred to by Mr O'Donoghue in his submissions (see paragraph 31 above), the Tribunal is not satisfied that the adverse state of the applicant's mental health and his poor financial circumstances and long-term employment prospects constitute special circumstances within the meaning, and for the purposes, of s 1237AAD of the Act. Nor, in the Tribunal's opinion, does the applicant's mistaken belief that the DSS had already recovered the amount of the relevant debt from MMI before he received from MMI the compensation amount of $15,974.40 in December 1996 constitute a special circumstance. Although the Tribunal is prepared to accept that the applicant honestly held that belief the Tribunal is not satisfied that that belief was objectively reasonable. The mere fact that the DSS had previously (in mid 1995) recovered from MMI an amount representing social security payments made to the applicant does not make his belief that that had again occurred prior to the payment made to him in December 1996 a reasonable belief in all the circumstances. It would be reasonable to expect that the applicant would have inquired of the DSS whether it had recovered the relevant compensation debt, but the applicant made no such inquiry.

36. The other relevant circumstances referred to by Mr O'Donoghue related to the alleged failure by the DSS promptly to notify the applicant of his compensation debt and take action to recover that debt after he had received the compensation payment of $15,974.40 in December 1996. Whether those circumstances might constitute special circumstances within the meaning, and for the purposes, of s 1237AAD of the Act, however, ultimately depends, in the Tribunal's opinion, on the date on which the applicant notified the DSS of that compensation payment.

37. It is common ground that the DSS did not notify the applicant of the relevant compensation debt or take any action to recover that debt until 1 August 1997 when it sent to the applicant a Recovery Notice under s 1170 of the Act (T10 - see paragraph 13 above). The respondent concedes, however, that the applicant notified the DSS of his compensation payment when he applied for newstart allowance on 29 April 1997 and that the DSS failed to act on that advice (see Exhibits A2 and A3 and paragraph 10 above). The applicant also notified the DSS of his compensation payment when he again applied for newstart allowance in late July 1997 and the DSS then promptly acted on that advice by issuing the abovementioned Recovery Notice on 1 August 1997 (see paragraphs 11-13 above). The applicant claims, however, that he first notified the DSS of his compensation payment when he returned to Perth from New Zealand in late December 1996 - that is, approximately 2 weeks after he received that payment. The respondent denies that it received such advice from the applicant at that time or at any time prior to 29 April 1997.

38. If, as contended by the respondent, the applicant did not notify the DSS of the relevant compensation payment until 29 April 1997, the Tribunal would not regard the failure by the DSS to notify the applicant of the compensation debt and to take recovery action until 1 August 1997 as a special circumstance such as would make recovery of that debt "unjust, unreasonable or otherwise inappropriate" (Ivovic, above) because by the former date the applicant, according to his own evidence, had already spent most of that compensation payment. If, on the other hand, the applicant notified the DSS of that compensation payment in late December 1996, as claimed by him, the Tribunal might well be inclined to regard the failure by the DSS to act on that advice and promptly notify the applicant of his compensation debt, together with the fact that he then spent the compensation moneys during the next 3 months in the belief that he did not have a compensation debt, as constituting special circumstances within the meaning, and for the purposes, of s 1237AAD of the Act because, in those circumstances, it could, in the Tribunal's opinion, be said to be unfair and unreasonable for the DSS to commence to take recovery action on 1 August 1997, approximately 4 months after those compensation moneys had been spent. Such recovery action could be said to be unfair and unreasonable in those circumstances because the applicant, by reason of the DSS's failure to notify him promptly or at least within a reasonable time of his compensation debt, would effectively have been denied the opportunity to make appropriate plans for the repayment of that debt (whether by immediately discharging it in full, as he said in evidence he would have done, or otherwise) before spending the compensation moneys or making other financial commitments. The question whether the applicant notified the DSS of his compensation payment in late December 1996 is, accordingly, a critical question of fact for the Tribunal's determination for the purpose of deciding whether to waive the compensation debt pursuant to s 1237AAD of the Act.

39. The only evidence before the Tribunal regarding that critical question is the applicant's oral evidence given on affirmation by telephone from New Zealand. These is no documentary material, either in the T documents or in the tendered exhibits, which either supports or refutes the applicant's oral assertion that he went into the local DSS office in Perth in late December 1996 when he had returned from New Zealand and told them that he had received his compensation payment. Having regard to all the circumstances of this case, the Tribunal is not prepared to accept the applicant's (obviously self-serving) evidence that he notified the DSS of his compensation payment in late December 1996. As previously mentioned, there is no documentary material - such as a written statement completed by, or on behalf of, the applicant and lodged with the DSS, or a DSS file note - before the Tribunal which supports that evidence. Given the importance of such a notification, it is most unlikely that no documentary record of it would have been made contemporaneously at the relevant DSS office. Furthermore, the Tribunal is not satisfied that the applicant's recollection of events said to have occurred approximately 5 years ago is reliable, especially having regard to his acknowledged drug misuse in subsequent years and his history of poor mental health (see Exhibit A8 and A9). The Tribunal also notes that there is no reference, either in the applicant's evidence and submissions before the SSAT or in the SSAT's Reasons for Decision, to his having notified the DSS of his compensation payment in late 1996. Likewise, no such reference was made in the applicant's Statement of Facts and Contentions filed in this matter or in his evidence-in-chief at the hearing. Instead the applicant's assertion that he notified the DSS of his compensation payment when he returned to Perth from New Zealand in late December 1996 was first made in response to a question from the Tribunal which was put to him after the conclusion of his evidence-in-chief.

40. Having regard to the aforementioned considerations, the Tribunal does not regard the applicant's evidence that he notified the DSS of his compensation payment in late December 1996 as reliable and it does not accept that evidence as factual. The Tribunal is not thereby suggesting that the applicant has deliberately given false evidence in this matter - rather, that the applicant's recollection of events approximately 5 years ago, as stated in his evidence, is unreliable and probably incorrect. Accordingly, the Tribunal finds that the applicant did not notify the DSS in late December 1996, or at any time prior to 29 April 1997, that he had received a compensation payment in the amount of $15,974.40 from MMI on or about 16 December 1996.

41. As previously mentioned (see paragraph 37 above) it is common ground that the applicant did notify the DSS on 29 April 1997 that he had previously received a compensation payment, and the Tribunal so finds. It is also common ground, and the Tribunal finds, that the DSS failed to act on that advice but, for the reasons explained in paragraph 38 above, the Tribunal does not regard that failure to act by the DSS as constituting a special circumstance such as would make recovery of the resulting compensation debt "unjust, unreasonable or otherwise inappropriate".

42. Having considered the circumstances of the applicant's case - in particular, the circumstances highlighted by Mr O'Donoghue in his submissions - the Tribunal finds that those circumstances do not constitute "special circumstances...that make it desirable to waive" the applicant's compensation debt, within the meaning of para (b) of s 1237AAD of the Act. Given that finding, it is not necessary for the Tribunal to consider whether the matter referred to in para (c) of s 1237AAD is satisfied in this case.

43. The Tribunal determines, therefore, that the compensation debt in the amount of $10,910.38 owed by the applicant to the Commonwealth should not be waived pursuant to s 1237AAD of the Act.

44. There remains the issue of whether the outstanding balance of the applicant's compensation debt should be written off pursuant to s 1236(1) of the Act, as found by the SSAT and as submitted by the respondent. The applicant's present circumstances are that he lives in New Zealand with his mother, is not in receipt of social security payments from Centrelink, and his financial circumstances are very poor in that he has no assets and owes a child support debt of about $3,000.00, in addition to his compensation debt. Although he presently has part-time employment his employment history has been very erratic and his long-term employment prospects must also be regarded as very poor. In these circumstances the Tribunal finds that at the present time the applicant has no real capacity to pay the outstanding balance of his compensation debt (which amounts to $9,189.78), and that it is appropriate to write off that outstanding debt pursuant to s 1236(1) of the Act.

45. Accordingly, the Tribunal determines that the outstanding balance of the compensation debt owed by the applicant to the Commonwealth - namely, the sum of $9,189.78 - be written off pursuant to s 1236(1) of the Act.

Decision

46. For the above reasons the Tribunal affirms the decision under review.

I certify that the 46 preceding paragraphs are a true copy of the reasons for the decision herein of Associate Professor S D Hotop, Senior Member

Signed: ..................(sgd V Wong).......................

Associate

Date/s of Hearing 5 December 2001

Date of Decision 9 January 2002

Counsel for the Applicant Mr P O'Donoghue

Solicitor for the Applicant Welfare Rights & Advocacy Service

Counsel for the Respondent Mr A Jones

Solicitor for the Respondent Advocacy and Admin Law Team, Centrelink