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[2009] AATA 302
appellant. The decision under review was set aside and remitted to the Secretary with a direction to waive the part of the Carer payment debt represented by the Newstart allowance that would have been paid...
The Tribunal found that Stapleton had received Carer payment after his mother moved into a nursing home, but that several circumstances made partial waiver appropriate. Centrelink had been told of the admission but could not use that information under the then applicable legislation. The Tribunal accepted Stapleton's evidence that he trusted a social worker who said she would contact Centrelink, and found that he had not knowingly failed to comply. It also considered that he would probably have received Newstart allowance during part of the same period. The Tribunal ordered that the Carer payment debt be reduced by the amount of Newstart allowance that would have been paid between 20 July 2004 and 16 January 2006. The order did not waive the Carer allowance debt.
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4 cited instruments linked from this judgment.
This is an Administrative Appeals Tribunal decision about recovery of social security overpayments and the statutory power to waive a debt in special circumstances. The applicant was the Secretary, Department of Families, Housing, Community Services and Indigenous Affairs. The respondent was Brian Stapleton. Senior Member M D Allen gave the decision on 1 May 2009 after hearings on 2 February and 23 April 2009.
Stapleton moved into his parents’ home in late 2000 to care for them. He began receiving Carer payment and Carer allowance on 6 March 2002 (para 2). His father died in April 2002. His mother had periods of respite or hospital care, and the Tribunal accepted that Stapleton had previously informed Centrelink about those episodes, although he did not remember the relevant telephone conversations. The Tribunal attributed that lack of recollection partly to evidence about his anxiety and cognitive functioning (paras 3-5).
Stapleton’s mother entered Shalom Nursing Home on 19 April 2004 and remained there until her death on 3 April 2006 (para 6). Stapleton continued visiting and helping her, but the Tribunal found that he became ineligible for Carer payment and Carer allowance from 27 July 2004, following the 14-week period referred to in s 198AAA of the Social Security (Administration) Act 1999 (para 7). He did not notify Centrelink of the permanent admission until January 2006, when he received a review form (para 6).
The Tribunal accepted that a social worker at Ryde Hospital had told Stapleton that she would contact Centrelink about the nursing-home admission. It also referred to an entry in his mother’s Centrelink file about a caller seeking a change of payment destination. The Tribunal considered that the entry was consistent with Stapleton’s account and that the redirection of his mother’s benefit to the nursing home reinforced his belief that Centrelink had been informed (paras 9-10).
A debt was raised for Carer payment over the period 27 July 2004 to 16 July 2006 and Carer allowance over the period 19 April 2004 to 16 January 2006 (para 8). The Tribunal noted that Centrelink had received information from the Department of Health and Ageing about the admission, but that the Aged Care Act provisions then in force did not permit Centrelink to use the information to adjust Stapleton’s Carer payment. The relevant provisions were later amended to permit information exchange for social security purposes, but the Tribunal dealt with the earlier law applicable to the period in dispute (paras 11-15).
The Secretary sought review of the SSAT decision, which had waived part of the debt. The Tribunal set the decision under review aside and remitted the matter with a direction that the Carer payment debt be waived to the extent of the Newstart allowance that would have been paid from 20 July 2004 to 16 January 2006 (para 44). The direction concerned Carer payment, not Carer allowance.
The Tribunal’s central task was to apply s 1237AAD of the Social Security Act 1991. As set out in the reasons, the Secretary could waive all or part of a debt if the statutory conditions were met. Those included that the debt did not result wholly or partly from specified knowing conduct, that special circumstances other than financial hardship alone made waiver desirable, and that waiver was more appropriate than write-off (para 30).
The Tribunal found that Stapleton had not knowingly made a false statement or representation, and had not knowingly failed to comply with social security law. It accepted that he relied in good faith on the social worker’s assurance (para 31). That finding mattered to the statutory test, but the Tribunal separately considered whether special circumstances existed.
It reviewed the approach to “special circumstances” discussed in Secretary, Department of Social Security v Ellis. The quoted authorities described the inquiry as dependent on the circumstances of the particular case, without precise limits, and concerned with whether something takes the case outside the usual or ordinary situation. The quoted reasoning also directed attention to the effect of applying the relevant provision or principle of liability (para 32). The Tribunal did not treat hardship by itself as enough.
It identified several circumstances in combination. First, Centrelink knew of the nursing-home admission but, under the then applicable information-sharing restriction, could not act on the information to adjust Carer payment. The Tribunal considered it unfair for a citizen to be disadvantaged because government agencies were legally restricted from passing or using information (paras 11-16, 39). It also accepted Stapleton’s evidence that he relied on the social worker’s statement that she would contact Centrelink (paras 9-10, 28, 39).
Second, the Tribunal considered Stapleton’s health and likely dependence on social security. It found that his ill health made it unlikely he would attract an employer and that he would remain dependent on social security income (para 40). This was part of the circumstances considered, rather than an independent conclusion about entitlement to a different payment.
Third, the Tribunal treated a notional entitlement to Newstart allowance as relevant. It understood Oberhardt v Secretary, Department of Education, Employment and Workplace Affairs [2008] FCA 1923 to establish that such an entitlement should not be excluded from the range of relevant considerations under s 1237AAD (para 33). Stapleton had been granted Newstart allowance in January 2006, and the Tribunal found no evidence that his circumstances had changed between the earlier period and then (para 37). It therefore considered that he was prima facie entitled to Newstart allowance during the relevant earlier period (para 42).
The Tribunal did not accept that Kelly prevented this approach. It read Secretary, Department of Employment and Workplace Relations v Kelly as concerning whether a tribunal had power to treat statutory conditions for a Newstart grant as having occurred when they had not. It said Kelly did not decide whether notional entitlement could be considered when assessing special circumstances (paras 34-36). It also distinguished Devriadis because Stapleton was receiving a social security benefit and believed himself properly entitled to it, whereas the circumstances described in Devriadis involved a requirement to seek paid work (para 38).
The result was a specific, limited direction: waive the part of the Carer payment debt equivalent to the Newstart allowance that would have been paid from 20 July 2004 to 16 January 2006. The Tribunal considered the SSAT’s use of an offset concept correct in principle but was not satisfied with the method used to calculate the amount, leaving the calculation to Centrelink (paras 42-44).
The decision concerned the law applicable to the overpayment period, not a general finding that Centrelink could always act on information supplied by another department. The Tribunal reproduced ss 86(4) and 86(5) of the Aged Care Act 1997 as they read in July 2004. It said those provisions restricted the relevant information-sharing, and that Centrelink could not use the Department of Health and Ageing’s information to adjust the Carer payment (paras 11-15).
The Tribunal also noted that the provisions had since been amended by the Families, Community Services and Indigenous Affairs and Veterans Affairs Amendment (2006 Budget Measures) Act 2006 to permit exchange of information for social security purposes (para 15). Its reasoning about the earlier period therefore depended on the statutory restriction it identified as applying at the relevant time. The decision does not analyse the full operation of the amended provisions.
On debt waiver, the decision’s key doctrinal point is its treatment of a notional alternative benefit. The Tribunal read Oberhardt as holding that a notional social security entitlement could remain within the range of relevant considerations under s 1237AAD (para 33). It applied that understanding to the Newstart allowance that Stapleton would, in the Tribunal’s view, have received during the period when Carer payment was overpaid (paras 37, 42-44).
This decision does not state that a notional benefit automatically requires waiver, nor does it establish a general formula for every debt. The Tribunal grounded its decision in the combined circumstances and directed a calculation tied to the facts and dates before it. The case is a Tribunal decision applying the cited Federal Court authority, not a substitute for the text of the legislation or the Federal Court’s reasons.
At para 31, the Tribunal said: “I find that the Respondent did not knowingly make a false representation or statement nor did he knowingly fail to comply with a provision of the social security law.” In plain English, the Tribunal accepted that Stapleton’s failure to notify was not deliberate in the relevant statutory sense. It relied on his good-faith belief that the social worker had contacted Centrelink.
At para 33, the Tribunal said that Oberhardt meant “a notional entitlement to a social security benefit should not be excluded from the range of relevant considerations” when deciding whether special circumstances existed. In plain English, even though Stapleton had not actually received Newstart during the earlier period, the Tribunal could consider whether he would have been paid it.
At para 39, the Tribunal identified Centrelink’s knowledge and its legal inability to act on that information as a special circumstance. It also accepted Stapleton’s evidence about the social worker’s assurance. In plain English, the agency’s possession of information did not erase the notification issue, but the legal barrier and the respondent’s belief were relevant to the fairness of recovering the full debt.
At para 42, the Tribunal expressly called the prima facie Newstart entitlement a third special circumstance. It distinguished Carer payment from Carer allowance in that passage. This helps explain why the operative order concerned only the Carer payment debt.
At para 44, the Tribunal stated the exact remedy: the decision was set aside and the matter remitted with a direction to waive the Carer payment debt to the extent of the Newstart allowance that would have been paid between 20 July 2004 and 16 January 2006. In plain English, the order did not simply cancel the entire debt. It specified a partial reduction, calculated by reference to the alternative payment.
The decision is most relevant to a fact pattern involving a social security overpayment, a statutory discretion to waive debt for special circumstances, and evidence that the recipient would have had a notional entitlement to a different payment during some or all of the overpayment period. The Tribunal’s reasoning is especially tied to the combination of a potential alternative benefit and other circumstances, rather than notional entitlement alone.
The information-sharing issue also formed part of the facts. Centrelink had received information about the relevant event from another government body, but the Tribunal found that legislation prevented it from using that information to adjust the payment at the time (paras 11-15, 39). The decision therefore may be relevant where a government agency’s ability to act on information is affected by a statutory restriction. It does not establish that agency knowledge always prevents a debt from arising.
The recipient’s state of mind and reliance were important. The Tribunal found that Stapleton had received notification instructions, but accepted that he believed the social worker would contact Centrelink and found no knowing failure to comply (paras 18-20, 28, 31). A case with materially different evidence about what the recipient knew, was told, or understood may not share that feature.
The Tribunal also considered health, likely employment prospects, and reliance on social security (para 40). Those matters contributed to its overall assessment, but the decision does not set out a threshold test for them. It did not find that financial hardship alone established special circumstances. The reasons expressly framed the statutory test as requiring circumstances other than financial hardship alone (para 30).
Finally, the remedy matters when comparing cases. The Tribunal accepted that an amount representing the alternative benefit could be used to reduce the relevant Carer payment debt, while leaving the calculation to Centrelink (paras 43-44). The order applied to the specific period and payment type in the case.
The supplied judgment is dated 1 May 2009 and contains no discussion of later decisions treating this Tribunal decision. The materials supplied therefore do not establish whether subsequent courts or tribunals followed, distinguished, or criticised Stapleton. No later-treatment claim can be made from this source alone.
The judgment does identify the authorities the Tribunal considered in reaching its own decision. It treated Oberhardt as supporting consideration of a notional social security entitlement under s 1237AAD (para 33). It distinguished Kelly on the basis that Kelly dealt with the tribunal’s power to deem statutory grant conditions satisfied, not the relevance of notional entitlement to special circumstances (paras 34-36). It distinguished Devriadis because Stapleton was receiving a social security benefit and believed himself properly entitled to it (para 38).
It also referred to Ellis and quoted reasoning associated with Beadle and Groth about the case-specific nature of the special-circumstances inquiry (para 32). QX05/10 was relied on in considering the risk that a person without immediate financial hardship might nevertheless be reduced to long-term financial difficulty (para 41). These are the relationships stated by the 2009 Tribunal; they should not be mistaken for evidence of how later courts treated Stapleton itself.
The reasons do not set out the precise dollar amount of the debt to be waived. The Tribunal said Centrelink could calculate what Stapleton would have received as Newstart allowance and directed that the waiver correspond to that sum (paras 43-44). The calculation is therefore not in the supplied text.
The decision also does not explain why the waiver period began on 20 July 2004, although it identifies 27 July 2004 as the date from which Stapleton became ineligible for Carer payment under the 14-week rule (para 7). The operative order uses the 20 July date. The source does not reconcile those dates, so the discrepancy should not be resolved by assumption.
The Tribunal found that Stapleton was prima facie entitled to Newstart allowance during the relevant period, drawing support from the grant made in January 2006 and the absence of evidence that his circumstances had changed (para 37). It does not set out a detailed calculation of the statutory conditions or payment rates that would have applied to each part of the earlier period.
The reasons also do not determine whether the same reasoning would apply to Carer allowance. The Tribunal’s express notional-entitlement finding relates to Carer payment, and the final direction is limited to that payment (paras 42-44). Nor does the decision decide that Centrelink’s receipt of information alone is enough to establish special circumstances. The information-sharing restriction was considered alongside Stapleton’s reliance, his health, and his notional alternative-benefit entitlement.
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DECISION AND REASONS FOR DECISION [2009] AATA 302
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
The decision under review is set aside and this matter is remitted to the Applicant with the direction that so much of the debt incurred by the Respondent as a result of the overpayment of Carer payment, as is represented by the amount of Newstart allowance that would have been paid to him in the period 20 July 2004 to 16 January 2006, is waived.
SOCIAL SECURITY: Overpayment of Carer payment - Whether special circumstances existed to enable debt to be waived - That another social security benefit had been payable to which the Respondent had a notional entitlement was a circumstance to be taken into account.
Aged Care Act 1997: Ss 86(4) and (5)
Oberhardt v Secretary, Department of Education, Employment and Workplace Affairs [2008] FCA 1923;
Secretary, Department of Employment and Workplace Relations v Kelly [2006] FCA 659 distinguished
Devriadis v Secretary, Department of Families and Community Services [2000] FCA 1289; (2000) 62 ALD 145 distinguished
QX05/10 and Secretary, Department of Employment and Workplace Relations [2006] AATA 178
Secretary, Department of Social Security v Ellis (1996-7) 24 AAR 535
"The Tribunal noted that there was an entry of 31 March 2004 in his mother's Centrelink file in relation to a caller wanting a change of payment destination."
Although it is now impossible to say who the caller was, this entry is consistent with the statement by the social worker at Ryde Hospital that she would contact Centrelink. Adding to the Respondent's belief that Centrelink had been notified was the fact that his mother's social security benefit was no longer forwarded to her but to the nursing home.
"86-4 A person to whom powers under part 2.3 have been delegated under subsection 96-2(5), or a person making assessments under section 22-4, may make a record of, disclose or otherwise use protected information, relating to a person and acquired in the course of exercising those powers, or making those assessments, or any one or more of the following purposes:
(a) provision of aged care, or other community, health or social services, to the person;
(b) assessing the needs of the person for aged care, or other community, health or social services;
(c) reporting on, and conducting research into, the level of need for, and access to, aged care, or other community, health or social services.
86-5 A person is guilty of an offence if:
(a) the person makes a record of, discloses or otherwise uses information; and
(b) the information is information disclosed to the person under section 86-3 or 86-4; and
(c) the purpose for which the person makes a record of, discloses or otherwise uses the information is not the purpose for which the information was disclosed.
Penalty: Imprisonment for two years."
" temporarily stops receiving your daily care and attention to enter hospital or for any other reason (even if it just overnight) permanently stops receiving your daily care and attention."
" One would assume that Mr Stapleton may have felt confused and struggled to absorb details. Forgetfulness and misinterpretation of facts and events is also highly likely."
However, earlier in her report under the heading Cognitive Assessment she states:
"These scores reflect reasonable verbal and intellectual skills, and also good short-term memory and attention skills for his age."
She continued:
"He also completed the verbal component of the Wechsler Memory Scales - Revised (WMS-R) to explore verbal memory. The test comprises two tasks that assess the ability to remember and associate words, and recall of short stories. His performance was good on both tasks and revealed normal learning over time."
She continued:
"Both his verbal and non verbal memory skills are good and commensurate with IQ, and no deficits are apparent from assessment."
She does, however, at paragraph 19 of her report state:
"His speech was persistently bumbled and his thought processes were digressive. These were not indicative of a psychotic condition but rather a communication disturbance..."
She went on to diagnose a moderate Generalised Anxiety condition as contained in DSM-IV-TR which she stated was long standing and present between the period of April 2004 and 2006.
"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."
"In Beadle v Director-General Social Security [1984] AATA 176; (1985) 7 ALD 670, a Full Court of this Court had to consider whether the Administrative Appeals Tribunal had erred in its interpretation of s 102(1)(a) of the Act which provided for an extension of time in which to claim a family allowance "...in special circumstances...". At 673-674 the Full Court said:
"Presumably in this context special circumstances must include events which would render the six months unfair or inappropriate...it would depend on the circumstances of the particular case whether these constituted special circumstances. We do not think it is possible to lay down precise limits or precise rules. The matter is one for the Director-General bearing in mind the purpose for which the power is given. The phrase "special circumstances", although lacking in precision, is sufficiently understood in our view not to require judicial gloss."
In Groth v Secretary, Department of Social Security [1995] FCA 1708; (1995) 40 ALD 541 at 545, Kiefel J, after referring to Beadle, said:
"... for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth's case from others, to take it out of the usual or ordinary case. That was, I consider, the only enquiry to be undertaken in this case. It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary. The enquiry I have referred to would involve considering what would be the effect, if the provision in question or the principle of liability it creates, is applied."
Later (on the same page) Kiefel J expressly approved the Tribunal's reasoning in holding that Mr Groth's circumstances were not out of the ordinary when Pt 3.14 of the Act (in which ss1168 and 1184 are to be found) had the same effect on him as it did on other persons qualified to receive a disability support pension. Her Honour added:
"It [the Tribunal] went on to find that his circumstances and those of his family although difficult, did not constitute hardship and they could not be said to be different from other pension recipients."
"We appreciate that the Applicant has funds but we consider that it is undesirable that a person who is not in immediate financial hardship should be reduced to long term financial difficulties if special circumstances are not found..."
I certify that the 44 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member M D Allen
Signed: ...............[sgd]................................................................
Solicitor for the Applicant Mr J. Larcombe, Centrelink Legal Services
Oberhardt
Secretary, Department of Education, Employment and Workplace Affairs
The decision under review was set aside and remitted to the Secretary with a direction to waive the part of the Carer payment debt represented by the Newstart allowance that would have been paid from 20 July 2004 to 16 January 2006.