Cao v Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

Federal Court of Australia|2015-06-05|Before: Perry J

The issue 1 Mr Ziming Cao was a recipient of the Disability Support Pension and the Newstart Allowance under the Social Security Act 1991 (Cth) (the SS Act). Mr Cao seeks an extension of time within which to appeal the decision of this Court at first instance refusing his appeal purportedly on a question of law under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) against a decision of the Administrative Appeals Tribunal (the Tribunal). The Tribunal had found that Mr Cao had been paid social security payments in excess of his entitlements which he was liable to repay and that there were no special circumstances, administrative errors or hurdles to recovery that justified waiving or writing off all or part of the debt under the SS Act. 2 Mr Cao appeared without legal representation at the hearing of the application for an extension of time and made his submissions through an interpreter in Mandarin. While directions were made extending an opportunity to Mr Cao to file written submissions in advance of the hearing, no submissions were filed by him. The Secretary, Department of Families, Housing, Community Services and Indigenous Affairs (the Secretary), filed written submissions which were read to the applicant by the interpreter before the hearing. 3 For the reasons given below, the application for an extension of time is refused.

2.2 The decision by the Administrative Appeals Tribunal 8 Mr Cao sought review of the SSAT's decision by the Tribunal. Mr Cao gave sworn evidence before the Tribunal, that the deposits, or at least some of them, into his HSBC bank account between 2003 and 2010 were loans received pursuant to business arrangements and relationships between his companies (Winga Enterprises Pty Ltd and Oziming-Caoziming Pty Ltd), some brothers named Yu who ran a paint importing business in China, Barloworld Coatings Australia Pty Ltd said to be the Australian supplier of paint to the Yu brothers, and a Mr Rong. Specifically, Mr Cao claimed that, as the "business sponsor" of the Yu brothers, he had guaranteed their obligations to Barloworld, and that Mr Rong and others had lent him money so that he could meet the obligations arising from the Yu brothers' dealings with Barloworld. 9 On 22 August 2013, the Tribunal affirmed the SSAT's decision. First, the Tribunal found that Mr Cao had not provided any plausible explanation for the deposits into his bank account, and that the disputed deposits were received by him for his own use or benefit. As such, the deposits constituted "income" for the purposes of the SS Act. In rejecting Mr Cao's evidence, the Tribunal found that his claims before the Tribunal were different from, and inconsistent with, previous explanations given to Centrelink and the SSAT, that his evidence was essentially uncorroborated by the documentary and other evidence on which he relied, and that his claims were "inherently implausible" for various reasons. Nor did the Tribunal consider that the circumstances were such as to enliven the powers to write off a debt under s 1236 of the SS Act, or to waive a debt on account of an administrative error under s 1237A or special circumstances under s 1237AAD.

2.3 The appeal to the Federal Court under s 44, AAT Act 10 On 19 September 2013, Mr Cao filed a notice of appeal in this Court pursuant to s 44 of the AAT Act. Section 44 provides that a party may 'appeal' to the Federal Court on a "question of law". The respondent filed a notice of objection to competency on the ground that the notice of appeal did not identify any question of law and therefore the jurisdiction of the Court was not properly invoked. 11 The appeal was dismissed on 14 February 2014. The primary judge considered that the objection to competency had "considerable force", as the "question of law" identified in the notice of appeal appeared to challenge only findings of fact by the Tribunal, while the grounds of appeal merely advanced reasons as to why the discretion to waive the debt should be exercised in Mr Cao's favour (at [17]-[18]). 12 Nor did his Honour consider that Mr Cao's written or oral submissions provided any further enlightenment in relation to any question or questions of law arising from the Tribunal's decision which could properly be the subject of an appeal. In this regard, the primary judge found that the further issues raised in Mr Cao's written submissions regarding evidence he claimed showed certain payments or material which should have been considered by the Tribunal failed to identify any question of law. His Honour also held that there was no evidence that certain of that material had been in evidence before the Tribunal, and other transactions and documents referred to had been considered expressly or impliedly by the Tribunal (at [19]-[20]). 13 The primary judge also considered the suggestion by Mr Cao in his oral submissions that the Tribunal did not give him an adequate opportunity to complete his case. As his Honour observed, such a contention could raise the question of whether there had been a denial of procedural fairness and thereby a question of law. However, the primary judge found that no such question had been raised in his notice of appeal or written submissions, no evidence had been lead in support of the ground, none of the material before the Court supported the allegation, and no application was made to amend the notice of appeal to include such a ground (at [26]). 14 The primary judge then considered whether any other questions of law could be discerned from the notice of appeal and submissions, and identified two possible questions of law. 15 First, his Honour found that the question of whether the facts as found by the Tribunal were capable of falling within the statutory definition of ordinary income could constitute a question of law. However, his Honour found that it was open to the Tribunal to conclude on the basis of rationally probative evidence that the HSBC deposits fell within that statutory definition. 16 The second possible question of law potentially raised, in his Honour's view, by Mr Cao was whether the Tribunal had failed to consider the case advanced by Mr Cao, or ignored evidence or arguments that it was bound to consider. However while such grounds might constitute an error of law, his Honour found that there was no basis for concluding that the Tribunal ignored or failed to consider any evidence before it relied upon by Mr Cao, given than many, if not most, of the factual contentions advanced by Mr Cao did not appear to have been supported by evidence before the Tribunal (at [33]). Nor, his Honour found, was it incumbent on the Tribunal to refer to every item of evidence that might have been before it (at [34]). Finally, the primary judge considered that there was no basis for concluding that the Tribunal had failed to have regard to the case Mr Cao advanced, or to any submissions of substance (at [35]). 17 The primary judge concluded that there was no discernible legal error in the Tribunal's decision and, to the extent to which the notice of appeal and submissions by Mr Cao could be said to raise any question of law, he had not demonstrated any such error. Otherwise, his Honour held the application must be dismissed as incompetent on the basis that it did not involve any question of law and therefore does not invoke the Court's jurisdiction under s 44 of the AAT Act (at [38]).

The ADJOURNMENT application 18 By letter from the Court's Registry dated 23 June 2014, Mr Cao was notified that his application for an extension of time for leave to appeal would be listed for hearing on 11 July 2014. The letter to Mr Cao enclosed a copy of the orders made on 23 June 2014 setting the matter down for hearing and accompanying timetabling orders for the preparation of the matter. 19 On 2 July 2014, the applicant made a request to the staff in the Registry for the hearing to be adjourned. In support of his request, Mr Cao provided a copy of a document entitled "Medical Certificate" dated 1 July 2014. I note that the document, although signed, did not appear on letterhead. That document stated that Mr Cao is "receiving medication for depression and anxiety" and that he would be "unfit to attend his hearing test on Friday, 11 July 2014 to Friday, 11 July 2014". The 'medical certificate' was accompanied by a copy of a prescription for medication issued to Mr Cao. 20 I was not prepared to accede to the request for an adjournment on the basis of the documentation provided. Accordingly, on Thursday, 3 July 2014, I directed that any request to adjourn the hearing of Mr Cao's application listed on 11 July 2014 be formally made in writing and supported by an affidavit(s) to which any documents sought to be relied upon were attached. 21 At the hearing, Mr Cao made an oral application for an adjournment. That application was opposed. In support of his application he handed up the medical certificate received by the Court on 2 July 2014. He also submitted that he was on medication which made him feel very drowsy and affected his understanding and concentration, and that he had bad back pain. 22 At the hearing I refused the application for an adjournment. Mr Cao had been on notice that his application was listed for hearing on 11 July 2014 since receiving the letter dated 23 June 2014. Furthermore, he had been provided with an opportunity to apply for an adjournment that was supported by appropriate evidence in advance of the hearing. No such application was made and no evidence was filed. Nor does the medical certificate address how Mr Cao's condition might affect his ability to participate in the hearing or give any indication as to when that condition might be improved so as to inform any appropriate period for an adjournment. As such, I did not consider that the evidence was sufficient to justify adjourning the proceedings. 23 However, given Mr Cao's submissions as to his condition and the impact on him of his medication, I made orders granting leave to Mr Cao to file and serve written submissions addressing any matters on which he wished to make further submissions in support of his application, together with any affidavit evidence to explain the reasons for the delay in instituting this appeal on or before 21 July 2014. Any submissions or affidavit in response were to be filed and served on or before 28 July 2014.

5.1 Principles governing the exercise of discretion to extend time 24 In the absence of an order extending time, an appeal from a single judge of the Federal Court to the Full Court must be filed within 21 days of judgment under r 36.03 of the Federal Court Rules 2011 (Cth) (formerly O 52 r 15(1)) (FCA Rules). 25 No notice of appeal was filed in the relevant period and the 21 days expired on 7 March 2014. An extension of time is sought pursuant to r 36.05 of the FCA Rules. 26 The principles which guide the discretion in deciding whether to grant an extension of time are well established, namely, that the applicant must show an acceptable explanation for the delay; any prejudice to the respondent in defending the proceedings is a material factor militating against the grant of an extension, although the mere absence of prejudice is not sufficient; and the merits of the appeal are to be taken into account: Dunlop v Fishburn (No. 3) [2012] FCA 315 at [9]-[11] (Katzmann J); Mladenov v Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2014] FCA 12 at [23] (Mortimer J) (citing Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 at 348-349). Thus while the respondent accepted that it would not suffer prejudice if the extension were granted, that is not sufficient in itself to justify the grant of an extension of time. 27 I consider that the application for an extension of time must be refused on the grounds that the delay is substantial, there is no evidence explaining the delay and the grounds of appeal in any event lack any merit.

5.2 Extent of delay and lack of any explanation 28 The applicant's delay in seeking an extension of time within which to appeal from the primary decision is substantial. As noted in the Secretary's submissions, the application was made approximately 95 days out of time. Moreover, neither the affidavit filed by Mr Cao in support of the application for an extension of time, nor the application for an extension of time, attempt to explain the reason for the delay. 29 At the hearing of the application for an extension of time, Mr Cao asserted that he had been to Registry many times and had tried unsuccessfully to file the documentation earlier because of the language barrier. However, the Court cannot act on mere assertion but only on evidence. As a consequence, I made orders at the hearing affording Mr Cao an opportunity to file affidavit evidence on this issue after the hearing. 30 Mr Cao filed two statutory declarations following the hearing of his application. The first concerned the alleged failures by the primary judge to allow Mr Cao to lead further evidence, while the second simply stated that Mr Cao "applied for three months of quiet days" and needed surgery. As such, the further evidence did not address the reasons for the delay and fell outside the terms of the leave granted on 11 July 2014 for the filing of further evidence. Accordingly, I have had no regard to that material. It therefore remains the case that there is no evidence explaining the reasons for the delay.

5.3 There is no merit in the proposed appeal 31 Nor is there any merit in the proposed appeal. 32 The draft notice of appeal proposes the following ground of appeal (without alteration): In the Administrative Appeals Tribunal used as evidence of the key to witness. The Tribunal turned down a witness to the court testify. Destroyed the trial of fairness and justice. The Federal court also shy away from the fact that a decision is unfair injustice. 33 The ground must be read bearing in mind that English is not Mr Cao's first language, and that he is unrepresented. Fairly read, the complaint appears to be of a failure by the Tribunal and the primary judge to permit Mr Cao to lead evidence from a witness and therefore of a breach of procedural fairness. It was apparent from oral submissions, that the potential witness to whom the complaint relates is Mr Rong. It will be recalled that in the Tribunal Mr Cao sought to explain some of the deposits into his HSBC account by alleging that Mr Rong, among others, had lent him money so that he could meet the obligations arising from the Yu brothers' dealings with Barloworld. 34 Despite the matter not being raised in the notice of appeal or in the written submissions, as earlier mentioned the primary judge dealt with the suggestion in Mr Cao's oral submissions of a possible breach of procedural fairness. Specifically, the primary judge held at [26] of his reasons that: One final matter raised by Mr Cao in the course of his oral submissions should be addressed. At various stages during his submissions, usually when seeking to explain why certain evidence or arguments had not been put before the Tribunal, Mr Cao appeared to suggest that the Tribunal did not give him an adequate opportunity to complete his case. In some circumstances, if made good, such a contention could raise the question whether there had been a denial of procedural fairness by the Tribunal. That is a question of law. Mr Cao does not, however, raise any such question or allegation in either his notice of appeal or written submissions. Nor did he seek to lead any evidence in support of such an allegation. Nor is there anything in the material before the Court to support the allegation or warrant any further investigation of it. Mr Cao did not seek to amend his notice of appeal to include any question of law based on a contention that he had been denied procedural fairness. Had he done so, leave to amend would have been refused on the basis that there was no evidentiary or factual basis to support the contention. 35 I can see no error in his Honour's reasons in this regard and none was identified by Mr Cao. To the contrary, the Tribunal made directions on 4 June 2013 setting a timetable for the provision of any further evidence on which Mr Cao sought to rely in advance of the hearing on 15 August 2013, including letters or statements from family and friends, bank statements, information regarding travel to and from China, and information regarding his accommodation during the debt period, by 23 July 2013. As such, Mr Cao had ample opportunity to file a statement from Mr Rong. No more is required by the requirements of procedural fairness: Fletcher International Exports Pty Ltd v Lott [2010] NSWCA 63 at [42] (Giles JA, with whom the remainder of the Court agreed).

conclusion 36 For the reasons set out above, the application for an extension of time should be refused with costs. I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perry.

Federal Court Rules 1979(Cth)

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