Decision of the Tribunal
18 The Tribunal ultimately set aside the decision under review and remitted the remaining debt amount to the respondent to recalculate.
19 The relevant issues for the Tribunal were set out at [20] of its reasons as follows:
(a) whether the applicant was overpaid the carer payment for the amount of $17,725.04 for the period of 18 January 2018 to 29 July 2019;
(b) whether any overpayment of the carer payment constitutes a debt to the Commonwealth and if so
(c) whether any debt owed to the Commonwealth is recoverable in part or in full.
20 The Tribunal then set out the applicable provisions at [21] - [30].
21 In relation to the first issue for consideration for the Tribunal, the Tribunal accepted the evidence that the applicant had informed the Agency of his marriage and, accordingly, for the purposes of receiving the carer's payment, the applicant was a member of a couple and taken to have pooled their income and assets on a 50/50 basis: s 1064-A2 of the Social Security Act 1991 (Cth).
22 The Tribunal accepted in this regard that the Agency had incorrectly calculated the applicant's carer's payments from 18 January 2018 to 29 July 2019. Accordingly, the Tribunal's answer to the first issue was "yes". The Tribunal at [33] of it reasons for reaching this conclusion were evidenced by:
(a) Payslips belonging to the wife of the Applicant tendered to the Agency on 22 January 2018, for the period of 29 November 2017 through to 26 December 2017, showing that year to date gross earnings as of 26 December 2017 were $34,817.4719.
(b) A completed and signed "MOD P" form tendered to the Agency on 22 January 2018, clearly stating that the Applicant's wife's fortnightly earnings were $2,575, including listing the name of her employer.
(c) A Notice of Assessment for the financial year ended 30 June 2017 tendered to the Agency on 28 February 2018, confirming the Applicant's wife's taxable income of $67,403 for the year.
(d) A copy of the personal income tax return of the Applicant's wife for the 2016-17 financial year tendered to the Agency on 14 March 2018.
(e) Payslips belonging to the wife of the Applicant tendered to the Agency on 5 August 2019, for the period of 29 November 2017 through to 9 July 2019. These payslips show that the year to date gross earnings to 9 July 2019 were $2,653.84; for the 2018-19 financial year to date gross earnings were $70,037.35; and for the 2017-18 financial year to date gross earnings were $68,858.69.
(footnotes omitted)
23 In relation to the second issue, the Tribunal held that the answer was also "yes". The Tribunal observed at [38] - [39]:
38. The Tribunal has found that the Applicant has received a greater amount of the carer payment than what they were otherwise entitled to receive during the period of 18 January 2018 to 29 July 2019.
39. The Tribunal finds that the amount of the carer payment received by the Applicant that was calculated on the incorrect combined income of the Applicant and his wife during the period of 18 January 2018 to 29 July 2019, is a debt due to the Commonwealth by the Applicant and constitutes a legally recoverable debt pursuant to s1223 (1) of the Act.
24 Lastly, and importantly, the Tribunal held at [46] that the debt could not be written off given that the debt was recoverable at law, the applicant had capacity to repay the debt, the applicant's whereabouts were known, and there was no evidence that the recovery of the debt by the Commonwealth would not be cost effective. Further, the Tribunal considered whether the debt should be waived as attributable solely to an administrative error pursuant to s 1237A of the Social Security Act. Relevantly, s 1237A provides as follows:
(1) Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
Note: Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).
(emphasis added)
25 Clearly, the Act requires an element of good faith. The Tribunal noted at [50] the applicant's attempts to comply with directions of the Agency and subsequently observed at [51] the Agency's error in not updating the applicant's information. However, at [52] the Tribunal detailed the occasions on which the Agency wrote to the applicant which stated that the assessments of his income was based on a combined total of $17.50.
26 In considering whether the applicant had acted in good faith, the Tribunal turned to the decisions in Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 152 ALR 127 and Jazazievska v Secretary Department of Family & Community Services [2000] FCA 1484. In particular, the Tribunal noted that the Court in Prince and in Jazazievska held that the state of mind of the person receiving the payment was relevant to the consideration of good faith. This does not require, as Cooper J noted in Jazazievska at [40], an element of fraud in order for a finding that the applicant lacked good faith, rather that the applicant will demonstrate a lack of good faith in circumstances where the recipient acted without an honest belief that he or she was entitled to the payment. In this respect, his Honour continued at [41] that a person does not act in good faith where they turn a blind eye to the circumstances which could raise doubt as to their entitlement to receive such payment. The Tribunal then referred to a decision of the Tribunal in Panacci and Secretary, Department of Employment and Workplace Relations [2008] AATA 30 where it was observed that the state of mind of the applicant was entirely subjective; at [25].
27 Overall, having regard to the material before it, the Tribunal considered that the applicant had acted in good faith for a portion of the period, namely from 22 January 2018 to 3 May 2018. In respect of the remainder of the overpayment period the Tribunal found as follows:
63. For the remaining period of the debt (being 4 May 2018 to 29 July 2019), the Tribunal is of the view that the debt was not solely due to an administrative error on the basis that the Applicant was informed on multiple occasions after having providing updated material to the Agency, that their payment was still being calculated on the basis of a combined income of $17.50. This view is made with specific reference to letters sent by the Agency to the Applicant on 3 May 201845; and 19 June 2018 46. There is no evidence before the Tribunal that the Applicant sought to update their income from 4 May 2018.
28 The Tribunal considered whether there were special circumstances to justify a waiver under s 1237AAD of the Social Security Act. That section provides:
1237AAD Waiver in special circumstances
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, the Administration 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."
29 Ultimately, the Tribunal determined that there were no such special circumstances, noting at [69] - [70]:
69. In the present application, it is the Tribunal's view that the Applicant's debts were not a result of the Applicant knowingly failing to omit or comply with the notices issued under the Administration Act, nor providing false or misleading statements.
70. In terms of special circumstances, the Applicant had submitted to the SSCSD of the Tribunal that they suffered from Crohn's disease, however when this was put to the Applicant at the hearing they did not wish to press this47.
71. Based on the evidence before the Tribunal, the Tribunal does not consider the Applicant's circumstances are sufficiently special or unusual to warrant the exercise of the discretion in s1237AAD of the Act to waive the Applicant's debt.
30 It follows that the Tribunal's answer to issue 3 was in the affirmative and remitted the matter to the respondent to recalculate the applicant's debt.