Devriadis v Secretary, Department of Family & Community Services

the background 6 The applicant was born in 1934 in Greece. He came to Australia in 1973. He and his wife were the directors and shareholders of Zorba Structural Steel Co Pty Ltd ("Zorba"), a corporation registered on 25 November 1977. It conducted a structural steel fabrication business from premises at Winnellie in Darwin. The applicant was employed by Zorba, at least until about 15 December 1990. On 8 December 1990 he was given one week's notice of termination. Zorba had other employees, but by December 1990 they had also been laid off. It appears that its business was not prospering. 7 On 4 February 1991, the applicant received from Zorba an Employment Separation Certificate signed by his wife. He then applied for unemployment benefits under the 1947 Act on 1 March 1991. His application was successful. He received the benefits under the 1947 Act and under the 1991 Act referred to above. 8 Whilst in receipt of those benefits the applicant performed some activities on behalf of Zorba. The fact that he was doing things on behalf of Zorba was not disclosed to the respondent at the time. The real factual issue before the Tribunal was as to the nature and extent of those activities. 9 Section 116 of the 1947 Act provided, so far as relevant to this appeal, that a person is qualified to receive an unemployment benefit if, and only if

"(a) … (b) … (c) the person satisfies the Secretary that - (i) throughout the relevant period he was unemployed and was capable of undertaking, and was willing to undertake, paid work that, in the opinion of the Secretary, was suitable to be undertaken by the person; and (ii) he had taken, during the relevant period, reasonable steps to obtain such work; …" 10 Section 116(4) provided for the respondent to treat a person as having been unemployed for a period even though that person may have undertaken some paid work. It was in the following terms:

"The Secretary may, in his discretion, treat a person as having been unemployed throughout a particular period for the purposes of sub-paragraph (1)(c)(i) notwithstanding that the person undertook paid work during the whole or a part of that period if the Secretary is of the opinion that, taking into account the nature and duration of the work and any other matters relating to the work that he considers relevant, the work should be disregarded." 11 Similar legislative provisions applied under the 1991 Act. Section 513 of the 1991 Act relevantly provided:

"Subject to sections 514, 515 and 519, a person is qualified for a job search allowance in respect of a period if: (a) the person satisfies the Secretary that throughout the period the person is unemployed; and (b) throughout the period, or for each period within the period, the person either: (i) satisfies the activity test; or (ii) is not required to satisfy the activity test; and (c) …; and (d) …" 12 The activity test was set out in s 522. It is not necessary to refer to it, because the Tribunal's decision was that throughout the relevant period it was not satisfied that the applicant was unemployed. 13 Section 516(1) was in terms similar to s 116(4) of the 1947 Act. It provided: "If: (a) a person undertakes paid work during a period; and (b) the Secretary is of the opinion that, taking into account: (i) the nature of the work; and (ii) the duration of the work; and (iii) any other matters relating to the work that the Secretary considers relevant; the work should be disregarded; the Secretary may treat the person as being unemployed throughout the period." 14 Following amendments to the 1991 Act, from 27 March 1992 the applicant was paid Newstart Allowance. The qualifications for that allowance, so far as relevant to this appeal, were set out in s 593(1) in the following terms:

"Subject to sections 594 and 598, a person is qualified for a Newstart Allowance in respect of a period if: (a) the person satisfies the Secretary that throughout the period the person is unemployed; and (b) throughout the period, or for each period within the period, the person satisfies the activity test; …" 15 The provision which, in general terms, substituted for s 116(4) of the 1947 Act and s 516 of the 1991 Act was s 595(1). It provided:

"If: (a) a person undertakes paid work during a period; and (b) the Secretary is of the opinion that, taking into account: (i) the nature of the work; and (ii) the duration of the work; and (iii) any other matters relating to the work that the Secretary considers relevant; the Secretary may treat the person as being unemployed throughout the period." 16 Section 1224(1) relevantly provides that an amount which was paid to a recipient by way of social security payment under either the 1991 Act or the 1947 Act because the recipient made a false statement or a false representation is a debt due by the recipient to the Commonwealth. Section 1236(1) of the 1991 Act empowers the respondent, on behalf of the Commonwealth, to write off such a debt. That power may be exercised only in one of the circumstances prescribed by s 1236(1A), namely 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." 17 Section 1237(1) also empowers the respondent to waive the Commonwealth's right to recover the whole or a part of a debt from a debtor, but only in prescribed circumstances. The relevant prescribed circumstances, for the present appeal, are contained in s 1237AAD which provides:

"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 the 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." 18 The matters which the Tribunal was required to address were (1) whether the applicant was unemployed during the period 1 March 1991 to 12 June 1993; (2) if not, whether it should nevertheless treat the applicant as being unemployed for all or any part of that period under s 116(4) of the 1947 Act or under s 516(1) or s 595(1) of the 1991 Act as they applied from time to time; (3) to the extent that it was satisfied that the applicant was not unemployed (or treated as unemployed) whilst he was in receipt of social security benefits during that period, whether the applicant received those benefits because he made a false statement or a false representation so that the amount so paid (or some part of it) is a debt due to the Commonwealth; (4) whether the debt should be written off under s 1236 of the 1991 Act; and (5) whether the debt should be waived under s 1237(1) and s 1237AAD of the 1991 Act.

the tribunal's reasons 19 The Tribunal received extensive material touching upon its consideration. Those documents included the materials provided in accordance with s 37 of the AAT Act (there were 268 pages originally provided and 439 pages in supplementary documents). The applicant gave evidence, as did his accountant Mr Fong. He also adduced in evidence a large red folder of documents containing extensive business records of Zorba and personal records, a folder containing banking records of Zorba and including comments upon certain of those records, a bundle containing financial statements of Zorba for the financial years ending 30 June 1992 and 30 June 1993, copies of his taxation returns for the 1991, 1992 and 1993 financial years, and two lengthy statements in which he set out to refute the detailed allegations of the respondent. Certain of the materials provided to the Tribunal by the applicant are also contained in the materials provided in accordance with s 37 of the AAT Act. 20 After referring to the relevant statutory provisions, and to the nature of the evidence, the Tribunal immediately turned to record its findings of fact. That section of the Tribunal's reasons is not as clear as it could be. Some of the "findings of fact" are uncontentious, and are set out in the background above. Some of them are expressed simply as findings about the contents of documents (that is, simply reciting the contents of documents), but without the Tribunal then indicating that it accepted the contents of a particular document as reliable evidence of the fact. In some instances, its "finding" or recital about the contents of a document or other evidence is expressed in a way which suggests that the Tribunal did not accept those contents as accurate. For example, one of the "findings of fact" concerned a document setting out a summary of cost of steel purchased by Zorba from a wholesaler in the period 1988 to February 1992. The table containing the summary is set out. The Tribunal then said that that table was unreliable, and gave reasons for that view. It is therefore difficult to discern clearly what detailed findings of fact the Tribunal made. 21 In Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259, Brennan CJ, Toohey, McHugh and Gummow JJ at 271-272 gave some direction as to how the Court should approach the reasons for decision of an administrative decision-maker. Their Honours said:

"When the Full Court referred to "beneficial construction", it sought to adopt an approach mandated by a long series of cases, the best exemplar of which is Collector of Customs v Pozzolanic. In that case, a Full Court of the Federal Court (Neaves, French and Cooper JJ) collected authorities for various propositions as to the practical restraints on judicial review. It was said that a court should not be "concerned with looseness in the language … nor with unhappy phrasing" of the reasons of an administrative decision-maker. The Court continued: "The reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error." These propositions are well settled. They recognise the reality that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed." Kirby J at 291-293 explained what his Honour regarded as the principles which should guide a judge conducting a review of an administrative decision. In endeavouring to ascertain the Tribunal's findings, and the reasons for its decision, I have of course had regard to those observations. 22 The Tribunal plainly indicated that it gave little weight to the applicant's evidence except where that evidence was corroborated by other evidence. It reached that conclusion upon its observation of the applicant's evidence. It also "had some difficulty" with the evidence of Mr Fong. Again, the Tribunal explained why it made that observation, although it is unclear whether that meant that it placed no weight on Mr Fong's evidence except where it was corroborated by other evidence. It is also plain that the Tribunal relied principally upon the documentary material in evidence. 23 It said:

"The documentary material before me indicates that the company [Zorba] was carrying on business during most of the relevant period albeit at a lower level of activity than previously because the applicant was unable to obtain sufficient work for the company. That affected the profitability of the company but does not alter the fact that the company continued to carry on business and it was the applicant who conducted that business for the company. There was no suggestion before me that any other person conducted the company's day to day business. I have taken into account the evidence that the company sometimes allowed others to use its facilities." 24 By reference to its "findings of fact", the following appears to be the findings based on documentary material which led to that conclusion: (1) Zorba operated its bank account between March 1991 and June 1993, with some 45 deposits over that period of 27 months totalling $127,857 and averaging $4,735 per month, and with some 400 cheque withdrawals over that period (some were dishonoured) totalling about $125,000. (2) Zorba entered into a number of contracts to perform structural steel work as follows: (a) prior to May 1990, with Multiplex Construction Pty Ltd ("Multiplex") in relation to the Supreme Court Building, with a completion date of September 1990, and in late 1992 with Multiplex to supply and install a rubbish chute for which it was paid $2,608 in December 1992; Multiplex paid Zorba $99,719 between July 1990 and June 1993 of which $28,506 was paid after March 1991. [Although its findings simply recite that information as being contained in a witness statement, it has apparently been accepted by the Tribunal as the fact, and included in the "documentary material"]. There was no submission put, nor is there any indication in the Tribunal's reasons, that the $28,506 was for work performed after March 1991, apart from the small job for which it was paid $2,608. (b) On an unspecified date, with John Holland Construction and Engineering Pty Ltd, to provide some shelving for $7,000 for which Zorba was paid $4,992 between October 1991 and January 1992. Again, no submission was put, and there is no indication in the Tribunal's reasons, that that contract was entered into after March 1991 or that the work was performed after March 1991. (c) In August 1991, to sell steel to Darwin Steelworks for $1,000. (d) In February 1992, to perform steel fabrication work for Watco Pty Ltd for $16,373, for which it was ultimately paid only a total of $6,000 in April and May 1992. (e) In March 1992, to perform structural steel work for Eniky Pty Ltd for which it was paid $12,000, but then Eniky Pty Ltd successfully claimed damages for non-completion of $12,167. (f) In April 1993, to construct a steel balustrade for which it was paid $2,000. (g) In April 1993, to fabricate and supply an item of warehouse equipment, for which it was paid $450. 25 In addition the Tribunal found that until April 1993 Zorba maintained the lease on its premises at Winnellie. There was also evidence (although the Tribunal made no express findings on these matters) that Zorba maintained until then its telephone connection and its advertisement in the Yellow Pages, and also engaged in some other advertising of its business. The Tribunal also found that in May 1992 Zorba joined the Territory Construction Association, that between October 1990 and December 1992 there was consistent use of electricity at its premises (the accounts show a low level of electricity use of less than $1 per day), and that in 1993 the applicant tried unsuccessfully to sell Zorba's business. 26 The Tribunal also made findings as to the contents of Zorba's financial accounts over the years ending 30 June 1991, 30 June 1992 and 30 June 1993. It does not state that it accepted those records as accurate. In my judgment, however, it must be inferred from its general finding about Zorba's business activities in the relevant period that the Tribunal has accepted those figures as reliable. It is hard to see how it could have come to the general conclusion set out in par 22 above based upon the contractual documents themselves, as they indicated to the Tribunal contracts totalling no more than $36,473 in the financial year ended 30 June 1992 and $2,450 for the financial year ended 30 June 1993. The profit and loss accounts showed: "1991 1992 1993 $ $ $ Gross Contract Revenue 123,088.00 45,626.00 57,306.00 Less cost of Goods Sold 34,112.00 12,723.00 3,474.00 Purchased Materials 4,706.00 270.00 20.00 Architects/Engineers/ 4,571.00 361.00 - Drafting Fees 5,312.00 3,695.00 2,050.00 Hire of Plant and 3,324.00 535.00 147.00 Equipment 71,056.00 28,040.00 51,615.00 Subcontractors 92,380.00 62,110.00 68,078.00 Welding Supplies -21,324.00 -34,069.00 -16,463.00 Gross Profit from Trading 11,700.00 11,636.00 2.00 Less:Expenses 361.00 7,298.00 48,966.00 Net Operating Loss -9,263.00 -15,135.00 32,505.00 Add: Non Cash Items: 1,788.00 1,660.00 140.00" Depreciation Less on Asset Realisation Adjusted Profit/Loss Electricity (incl in Expenses)

27 The Tribunal further observed that the balance sheets indicated that Zorba had no debtors "suggesting a cash or prompt payment business". It also compared its outgoings for the year ended 30 June 1992 of $60,661 (the cost of goods sold and expenses excluding depreciation and asset realisation loss) with the payments from the bank statements for the period of $67,153. (It is not clear that that comparison is appropriate, as it appears to compare cash outflow with accrued trading liabilities). It noted that the bank outgoings included $37,072 cash cheques "which Mr Fong said were part of shareholder drawings", and then added:

"Accepting Mr Fong's figure of $37,072 for shareholder drawings there is a discrepancy suggesting cash transactions. In coming to that conclusion I have taken into account the fact that the balance sheet does not show any trade debtors or trade creditors. The bank overdraft increased by $17,441, thereby providing part of the cash flow for the year." 28 As I understand the Tribunal, it is accepting the profit and loss statement as accurately showing trading outgoings of $60,661, but because the bank payments (excluding shareholders drawings) total some $29,081, there was some additional work performed for which Zorba or the applicant was paid in cash. It is necessary for the Tribunal to have accepted Mr Fong's evidence on that particular matter to have reached that conclusion, although it "had some difficulty" with his evidence and even though it later recorded as a finding merely a recital of certain evidence on the topic as follows:

"In cross-examination the applicant admitted that it was likely he had withdrawn cash from the bank account to pay wages or a subcontractor. The accountant said that cash cheques had been treated as shareholder drawings in the accounts totalling $37,027.00 for the year ended 30 June 1992 and $35,292.00 for the year ended 30 June 1991." 29 The Tribunal also found that "bank deposit slips suggest, and I infer, that Zorba was also doing limited subcontract work for other contractors". Counsel for the respondent was not able to point to any feature of the bank deposit slips in evidence which might have lead the Tribunal to that interpretation, or to have enabled it to draw that inference. 30 The Tribunal also found that the applicant and his wife owned an investment property at Bombing Road, Winnellie which derived rental income in excess of $900 per month until December 1992. It is accepted that that date should be December 1991. The property was mortgaged, with liability for mortgage payments each month. It found that the applicant did not refer to that rental income in his claims for benefit. It appears to be common ground that, from December 1991, the applicant and his wife were unable to lease that property. It also found that, in his applications for benefit, the applicant had consistently answered "No" to the question "Did you work?" 31 There were further findings made about the applicant's bank accounts which the respondent acknowledges to be wrong. It found he operated two accounts at a bank at Casuarina in part of the relevant period. The respondent acknowledges there was only one. It also found that one account was operated as "a false name passbook account" because the name on the passbook is a corrupted spelling of his name, that is "Deuriadis". It was that account into which the applicant's benefits were paid. It is not clear that the Tribunal used the epithet "false name" to indicate some deliberate conduct on the part of the applicant. It is far more likely that the misspelling was an administrative error, perhaps only on the passbook itself. That bank had no difficulty in identifying that account when responding to the inquiry of the Secretary for information about accounts in the name of the applicant. The submission put on behalf of the applicant was that these two matters were of considerable moment, because such errors may have unfairly coloured the Tribunal's approach to its assessment of the applicant's credit. It is hard to understand what use, if any, the Tribunal made of the findings about his bank account even though it did make those findings. However, the Tribunal has indicated to what matters it had regard in reaching its view about the applicant's credit. They do not include reference to its findings about his bank account. In that circumstance, I do not think that it has been shown that those findings tainted that assessment of his credit. It is not necessary to consider whether, had those apparently erroneous findings played any part in that assessment, there would have been an error of law such as to disturb the Tribunal's decision. 32 The Tribunal also referred to a copy of the income tax return of the applicant for the year ended 30 June 1992, as submitted to a lending institution. It recorded that the applicant had received assessable income from employment by Zorba of $23,600 in that year, and had net rental income of $6,760. The income tax return submitted to the Australian Taxation Office for the same period does not disclose the rental income or any income from Zorba. The Tribunal found that the return submitted to the Australian Taxation Office was a false return, as it did not disclose the rental income. It however made no express finding about which of the returns accurately represented any earnings of the applicant from Zorba. That material was not referred to in the section of the Tribunal's reasons under the heading "Consideration". 33 The applicant told the Tribunal that, in the relevant period, he attended Zorba's premises most days in his capacity as a director. He was trying to trade the company out of its losses. He was not employed by Zorba after 15 December 1990. He is recorded as acknowledging that his failure to disclose the rental income from the Bombing Road property led to an overpayment in benefits. 34 The Tribunal's conclusions, in the light of its findings as set out above, are brief. Apart from the general conclusion based upon documentary evidence set out in par 23 above, the Tribunal also took into account that a potential purchaser conducted the Zorba business for some period. That, it said, also led to the conclusion that Zorba effectively only ceased trading when evicted for non payment of rent in April 1993. 35 It then said:

"Because the applicant was the controlling mind of the company and was a director of the company I am not satisfied that he was unemployed while the company continued to carry on business. Should I treat the applicant as being unemployed for a particular period? Given my findings about the activity of the company, the likelihood of undisclosed cash trading and the applicant's direct involvement in the day to day running of the company there does not appear to be any ground for exercising the discretion to treat the applicant as being unemployed for any of the relevant period while the company was carrying on business. There is nothing in the material before me that would justify a finding of special circumstances resulting in waiver of the whole or part of the debt. In my opinion the applicant made dishonest claims for benefits and there is nothing that is unfair or inappropriate in him now being required to repay the debt due to the Commonwealth. As to financial circumstances there is no material before me to justify a write off of the debt."

consideration of contentions 36 In McAuliffe v Secretary, Department of Social Security (1991) 23 ALD 284 ("McAuliffe") von Doussa J at 290-292 discussed the authorities bearing on the meaning of the term "unemployed" as used in s 116 of the 1947 Act and in s 513 and later s 593(1) of the 1991 Act. His Honour concluded at 292 (in a passage with which the Full Court (Spender, Foster and O'Loughlin JJ) expressed its concurrence: McAuliffe v Secretary, Department of Social Security (1992) 28 ALD 609 at 614 ("the McAuliffe appeal")):

"… the question whether the appellant was 'unemployed' during the whole or part of the period when benefit was paid was essentially a question of fact and degree to be decided having regard to the above principles." 37 Perhaps the most significant of those principles for present purposes were those referred to by the Tribunal (Morling J, the Hon J B K Williams and Dr J G Billings) in Re McKenna and Director General of Social Services (1981) 3 ALD 219 at 221-222:

"The apparent legislative intent of the provisions of the Act concerned with eligibility for and payment of unemployment benefit is to provide those people who are not engaged in work of a remunerative nature with the means of subsistence in circumstances where, despite capacity, willingness and effort on their part, they have been unable to find paid work to maintain themselves. It is in this context that the word "unemployed" is used, coupled with the other words in para (c)(1) "and was capable of undertaking and was willing to undertake paid work and that in the opinion of the Director-General was suitable to be undertaken by the person". Subsection (2) requires satisfaction on the part of the Director-General that reasonable efforts have been made to obtain paid work. When regarded in the context of the apparent legislative intent and the other terms and expressions used in the subsection, it seems to us that the word "unemployed" bears its colloquial or popular meaning of not being engaged in work of a remunerative nature. This meaning must, however, be modified to some extent in that the means test provisions of the Act recognise that some income may be earned by a grantee of an unemployment benefit resulting in the diminution of the grant but without destroying eligibility for it. It must also be modified to allow for those special cases where a person is not engaged in work of a remunerative nature but whose commitment to some activity, eg study or domestic duties demonstrates a preference for that activity rather than employment. Cf Re Thomson and Director-General of Social Services (1981) 3 ALN N86." 38 In Re Te Velde and Director-General of Social Services (1981) 3 ALN N111, the Tribunal at N114, pointed out that the absence of evidence that certain activity is effective in producing a livelihood may not be critical in deciding whether the activity qualifies as 'work'. See also Clear v Smith [1981] 1 WLR 399; Re Brabenec and Director-General of Social Services (1981) 3 ALN N63. 39 In McAuliffe, von Doussa J recognised that a self-employed person who works varying hours each day for little return may not be 'unemployed' as that person may be "seriously engaged in economic enterprise": Re Malaj and Secretary, Department of Social Security (1988) 15 ALD 33; Re Vavaris and Director-General of Social Security (1982) 5 ALN N16. In McAuliffe the documentary evidence presented a strong picture of business activity that was inconsistent with the notion of the applicant being unemployed. 40 The applicant submitted that the Tribunal failed to apply those principles in reaching its conclusion, in particular because it had not distinguished between activities undertaken by the applicant in his capacity as a director of Zorba from those which previously had been undertaken by him as an employee of Zorba, and because the Tribunal had treated monies received by Zorba by way of debt repayment as earnings of the applicant. 41 It may be accepted that, as a director, the applicant had ongoing obligations with respect to Zorba. Those obligations may explain why he attended its premises to check its mail, to attend to its banking, and to attend to the payment of its bills. However, the Tribunal found that, in the period March 1991 to April 1993, Zorba continued to carry on business. It was apparently looking for work. It obtained some contracts to do work, and carried out those contracts at least in part. It appears to have accepted that the gross contract revenue during the year to 30 June 1992 was at least $45,626 and to 30 June 1993 (effectively to 30 April 1993) was at least $57,306. It also found that that gross contract revenue was likely to have been somewhat greater because there were cash transactions not reflected in its financial statements. Furthermore, the Tribunal found that it was the applicant who procured those contracts for Zorba and who conducted its day to day affairs. It may well be that the applicant regarded himself as carrying out those functions as its director, rather than as an employee. It may be that, in the particular circumstances, it is appropriate to describe him as a 'working director'. However, in my judgment, those findings provide an adequate basis for the Tribunal to conclude that he was not "unemployed" during the relevant period. 42 The Tribunal's conclusion (set out in par 34 above) was that, because the applicant was the controlling mind of Zorba and was a director, it was not satisfied that he was unemployed while Zorba continued to carry on business. It might be said that the Tribunal there fell into error by treating the status of the applicant in relation to Zorba as dictating the conclusion. If that were so, I consider that it would have fallen into error. However, that conclusion was reached only after the Tribunal explained its findings about Zorba's activities during the relevant period. In my view, that conclusion is to be understood in the light of the Tribunal's findings about the nature and extent of Zorba's ongoing activities, and about the applicant's role in carrying out those activities. In that context, I do not consider that the Tribunal incorrectly applied the principles discussed in McAuliffe. It has addressed the question whether as a matter of fact and degree, the appellant was unemployed. It did so on the basis that "unemployed" bears its colloquial meaning. Its conclusion reflects its findings that the applicant was working for the benefit of Zorba in carrying out its normal business activities on a significant scale, albeit a scale reduced from its level of activities of previous years. 43 The applicant also challenged the findings of the Tribunal based on the financial accounts of Zorba, and about certain of its other records. However, in my view, it has not been shown that those findings had no foundation. Upon the basis of the primary materials referred to by the Tribunal, I consider that those findings were available to be made. This ground of appeal is not made out. 44 The applicant's next challenge was to the manner of the Tribunal's exercise of its power under s 116(4) of the 1947 Act and under ss 516(1) and 595(1) of the 1991 Act. It decided not to treat the applicant as unemployed for any particular period. It based that conclusion upon its findings · about the activities of Zorba during the relevant period, · about the likelihood of undisclosed cash trading, and · about the applicant's direct involvement in the day to day running of Zorba. 45 The thrust of the submissions was twofold. Firstly, it was submitted that the Tribunal had failed to make findings upon any of those matters, but in its "findings of fact" it had simply made findings about the contents of documents without making findings about whether those documents accurately reflected the facts to which they referred, or had otherwise failed to identify the facts which it found to exist. Secondly, it was submitted that the "finding" of the likelihood of undisclosed cash trading was a finding of fact which was not open on the evidence before the Tribunal. Allied to those contentions, it was also submitted that the Tribunal failed to give reasons for its decision which included its findings on material questions of fact and a reference to the evidence or other material on which those findings were based, as required by s 43(2) and (2B) of the AAT Act. A substantial failure to comply with those provisions may constitute an error of law: Dornan v Riordan (1990) 24 FCR 564; McAuliffe at 292-293; and the McAuliffe appeal at 614-617. 46 My consideration of the Tribunal's reasons above indicates that it is only with some difficulty that it is possible to discern the Tribunal's detailed findings of fact which ultimately led to its conclusions. It is correct that, in some respects, the "findings" are not explicitly made but simply record the contents of documents. However, as I have indicated, in my judgment it is clear enough that the Tribunal accepted and placed weight mainly upon the financial statements of Zorba in concluding that it was carrying on business during most of the relevant period at a somewhat lower level of activity then previously. The evidence of individual contracts, and the bank records, provided documentary evidence that confirmed this position. The applicant's own evidence provided the basis for the Tribunal's conclusion that he was directly involved in its running. It may be, as the applicant's counsel contended, that he would have been better off placing Zorba into liquidation rather than to endeavour to restore its previous well-being. But the Tribunal found that his activities in endeavouring to restore its well-being meant that he was not "unemployed", even though his efforts may not have been successful. I have concluded that it did not misconstrue or misapply the relevant provisions of the 1947 Act and the 1991 Act in reaching that conclusion. In my judgment, reading the Tribunal's reasons as a whole and not over-zealously, particularly in the light of the documentary evidence upon which it relied, the basis of its reasoning emerges clearly, as does the source of the material for its conclusions. I have explained why I reached that conclusion in my consideration of its reasons. 47 There are two "findings" which present particular concerns. They relate to the finding about the discrepancy in the two versions of the applicant's copy taxation returns for the financial year ended 30 June 1992. In one version he indicated that he had received assessable income from Zorba of $23,600 and in the other no assessable income from Zorba is declared. They soundly relate to the weight given to the evidence of the accountant Mr Fong. It is, in my view, unclear what use the Tribunal made of the first of those "findings". It made the point that the taxation return which did not disclose the Bombing Road property rental was incorrect, but it did not deal with the accuracy of the information that the applicant had earned $23,600 from Zorba in that year. However, the Tribunal is not obliged to make findings about each piece of evidence on each argument. The purpose of provisions such as subs 43(2) and (2B) of the AAT Act are to ensure the public and the parties are informed of the manner in which the Tribunal's decision was arrived at. That enables it to be determined whether legal error has been made in the consideration of the application, and to demonstrate generally that the Tribunal has approached its responsibility properly and fairly. In my judgment, the failure to indicate whether it regarded one or other of those versions of the taxation returns as accurate in relation to the applicant's earnings from Zorba does not amount to a failure to comply with s 43(2) and (2B). In my judgment, its reasons sufficiently indicate why it reached its decision, and the material on which it relied. 48 The use of Mr Fong's evidence that the cash cheques were shareholder drawings is to be seen against the Tribunal's comment that "it had some difficulty" with Mr Fong's evidence and against its "finding" recording the evidence of the applicant and Mr Fong about the nature of cash cheques. It would have been much more satisfactory for the Tribunal clearly to have indicated what, if any, findings it made on the basis of Mr Fong's evidence. In McAuliffe, von Doussa J at 293 described the expression of having difficulty with certain evidence as

"… an unhappy choice of language as it does not - in plain unambiguous words - say whether the [evidence is] rejected, or … accepted albeit with difficulty." 49 However, it is necessary to read the Tribunal's reasons as a whole. It has clearly concluded that, in addition to transactions recorded in the financial accounts of Zorba and disclosed in the contracts in evidence, there were some cash transactions. To have reached that conclusion, it has accepted that the cash cheques were payments to shareholders of Zorba. In my view, therefore, the evidence of Mr Fong on that topic can be seen to have been accepted by the Tribunal. 50 The consideration of the financial accounts of Zorba by the Tribunal also demonstrates, in my view, the reasoning of the Tribunal leading to its conclusion that it is likely that Zorba, in the relevant period, did undertake some cash transactions. In reaching that conclusion, it is not shown to have made an error of law. It has also identified the material upon which that conclusion was based. 51 For those reasons, I do not consider that the applicant has made out his challenges to that aspect of the Tribunal's reasons. 52 The applicant also submitted that the Tribunal, in its consideration of s 116(4) of the 1947 Act, and ss 516(1) and 595(1) of the 1991 Act, failed to address the possibility that the applicant's activities on behalf of Zorba were of an unusual or sporadic nature. It was put that, upon its findings about the specific contracts, they represented contracts for $2,450 only in the financial year ended 30 June 1993. In my judgment, the Tribunal has addressed the question of whether Zorba's activities in the relevant period, and the applicant's activities on its behalf, were of a continuous character. It has made findings on that topic, based upon the evidence referred to. The reference to the likelihood of undisclosed cash trading indicates that it was considering whether there were significant periods when the applicant's efforts on behalf of Zorba were not productive of any work, so that his work was of an unusual or sporadic nature (cp. Re Waller and Secretary, Department of Social Security (1985) 8 ALD 26; Kawecky v Secretary, Department of Family and Community Services (1999) AATA 112). The applicant did not dispute that those authorities set out appropriate principles for the proper application of those provisions. Accordingly, I do not consider that this ground of appeal has been made out. 53 The applicant's attack on the finding of the Tribunal that he had misled the respondent, and had as a result received the benefits, was confined to its conclusion that the applicant had made false statements or false representations to the respondent. He complained that it had failed to make further inquiries before rejecting the applicant's evidence that he had been advised by an officer of the respondent that he was not required to disclose as income money received by him from Zorba during the relevant period, or his evidence claiming that the outgoings on the Bombing Road property, including mortgage interest and repayments and payments to be made in reduction of Zorba's indebtedness, exceeded the rental income, or his evidence that he had disclosed that rental income to the respondent. I am not persuaded that the Tribunal erred in law in any of those respects. The Tribunal decided to place no weight on the applicant's evidence except where it was corroborated by documentary evidence. It indicated that it placed weight principally on the documentary evidence. It did not err in law in reaching that view. In my judgment, it follows that it did not err in law in finding that the applicant misled the respondent in relevant respects. The Unemployment Benefit Claim completed by the applicant on 1 March 1991 included the following questions and answers:

"Do you have any other investments No or money on loan? … Are you self employed or the owner No or part owner of a business or farm? Do you own or have an interest in No any real estate/farm? Do you have any other assets? No" 54 Counsel for the applicant accepted that, at least the non-disclosure of the Bombing Road property rental income would have led to the applicant receiving a level of benefits to which otherwise he may not have been entitled. The discussion in the McAuliffe appeal at 618-619 to which counsel for the applicant referred is not, in my view, to the point. That discussion looked at whether the applicant in that case should succeed where the Tribunal had given no reasons for treating the overpayment of benefits as a debt. In this matter, the Tribunal has positively found that the applicant made dishonest claims for benefits. There was material upon which it could reach that conclusion. I do not consider that this ground of appeal has been made out. I do not think that the Tribunal's erroneous findings noted above, namely concerning the nature of the applicant's bank account or accounts and the time when the Bombing Road property rental ceased, involve an error of law impacting adversely upon the Tribunal's overall conclusion in the circumstances. 55 Finally, the applicant attacked the Tribunal's decisions under ss 1236(1) and (1A) and under ss 1237(1) and 1237AAD not to write off or waive the debt. The relevant ground of appeal, and the submissions, claim that the Tribunal failed to consider at all whether to exercise the discretions available under those provisions. It is clear from the transcript of the hearing before the Tribunal that it was contended on the applicant's behalf that the debt (if found to exist) should be written off or waived. 56 Clearly, the Tribunal addressed those two discretions. It dealt with the question of waiver first. It found that there was

"… nothing in the material before the Tribunal which would justify a finding of special circumstances resulting in waiver of the whole or part of the debt." 57 It also had regard to the applicant having made dishonest claims for benefits, and that "there is nothing that is unfair or inappropriate" in him now having to repay the debt. Those matters are clearly directed to the terms of s 1237AAD of the 1991 Act. The requirement of satisfaction as to the existence of special circumstances is a condition precedent to the ability to exercise the discretion to waive the debt. The Tribunal was not satisfied that special circumstances existed, and gave its reasons. It is not shown to have erred in law in that consideration. I have also considered whether the Tribunal may have erred in failing to consider as a possible special circumstance that the applicant may have been entitled to some level of benefit under the 1947 Act or the 1991 Act during the relevant period, even if he had made full disclosure to the respondent. I do not consider that it erred in law in that regard. The Tribunal has determined that the applicant should not be treated as unemployed under s 116(4) of the 1947 Act, or under ss 516(1) or 595(1) of the 1991 Act. Those provisions are directed to enabling a period of employment as being treated as a period of unemployment, having regard to the nature of the work, its duration, and other matters relating to the work. The Tribunal decided that the work the applicant did for Zorba during the relevant period was such that it should make an order under any of those provisions. Consequently, the criterion of being unemployed upon which eligibility for benefits depended has been found by the Tribunal not to exist. The Tribunal is not shown to have erred in its understanding of the expression "special circumstances": see the discussion as to the meaning of that term in Condren v Secretary, Department of Family and Community Services [2000] FCA 268 per Lehane J at [11]; Kertland v Secretary, Department of Family and Community Services [1999] FCA 1596 per Merkel J at [30-45]; Beadle v Director-General of Social Security (1985) 60 ALR 225 at 228-230. 58 The Tribunal separately, but briefly, addressed the write off of the debt. Its brief reason for declining to write off the debt was that there was no material about the applicant's financial circumstances which would justify doing so. It is apparent that the Tribunal was not satisfied that any of the qualifying circumstances in s 1236(1A) for the exercise of the power to write off the debt were made out. Its reasons for that view are laconic. But I think that they demonstrate that, in the light of all the evidence, the Tribunal was not satisfied that the debt is irrecoverable at law, nor that the applicant did not have the capacity to repay the debt, nor that if he is not receiving benefits under the 1991 Act it is not cost effective for the Commonwealth to take action to recover the debt. 59 Clearly, the Tribunal did consider the exercise of the powers of waiver and write off of the debt. The error of law asserted has not been made out. 60 Accordingly, in my judgment, the applicant has not made out any of the grounds upon which he submitted that the Tribunal had erred in law. In those circumstances, the application must be dismissed. I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Mansfield.

Associate: Dated: 15 September 2000 Counsel for the Applicant: Mr F Davis

Solicitors for the Respondent: Australian Government Solicitor