3. The facts so far as they are not in dispute are as follows. The respondent applied for SPP on 11 June 1990. On 17 June 1990, she commenced working at Quality Software on a temporary basis and advised the Department of that fact in a Sole Parent's Review form dated 9 July 1990. She ceased work on 13 July 1990. In a letter dated 19 June 1990 (T9, p 34) she was advised that SPP had been granted at the rate of $356.50 per fortnight, commencing on 21 June of that year, that is, after she had commenced working but prior to the Department's receipt of her advice. That letter included a statement: "You are required to tell us within 14 days if your income becomes more than $52 a week". Curiously, it did not require the recipient to give details of earnings. It also advised the recipient to read the back of the letter. On the back under the heading "Notice under Section 163 of the Social Security Act" there is a page full of fine print divided into 2 columns. The notice commences with the statement: "For this reason you are required to tell the Department within 14 days if any of the following occur, or if you know in advance if they are likely to occur" and shortly after adds: "You must tell us if: . you... start paid work".

4. After a brief period of unemployment the respondent was employed with Hutton Langoulant MacRae from 23 July to 24 August 1990. She advised the Department of this in a Review form dated 6 August 1990, received on 9 August, and made the following statement on the latter date:

"My Sole Parent Four/Twelve Weekly Review Form was not lodged on

the due date because - I thought it was due on 9/8 and forgot."

An officer of the Department subsequently spoke to her employer and in a file note (which the Tribunal regards as significant) dated 4 September 1990 the officer stated:

"Appears she has exceeded E/C (earnings credit) limit as prev.

ceased work on 13/7. Has she incurred an O/P?"

The respondent's employer at that time confirmed her income for 5 weeks' work in a report 1 which was received by the Department on 17 September 1990.

5. A further period of unemployment followed until the respondent obtained a casual position as a Data Processor with the Women's Cancer Prevention Unit of the Department of Health from 4 September 1990. She continued working until 11 January 1991. In response to the question "did you do any paid work during the last 12 weeks" in a further Review from dated 9 September 1990, the respondent, for reasons she explained in her evidence, answered "No". On 2 November 1990, the Department received a letter from the respondent addressed to "Wayne" dated 31 October 1990 advising of her income from the Department of Health and enclosing 4 pay slips. The circumstances surrounding that letter are discussed below.

6. An overpayment of $2120.80 was raised on 27 November 1990 and approved the following day following advice obtained from the respondent's employers regarding wages paid to her for the period 21 June to 8 November 1990. Ms Lea was advised in a letter dated 27 November 1990 that she had been overpaid, the overpayment having occurred because she had commenced work on 21 June 1990 and had failed to advise the Department within 14 days, and that the Department was seeking to recover that amount under s.246 of the Social Security Act 1947 ("the 1947 Act").

7. The applicant commenced withholdings from the respondent's SPP from 20 November 1990. On 30 November 1990 the respondent contacted an officer of the Department claiming the overpayment was due to a mistake on the part of the Department and that she was "stretched financially". She was told to complete a Statement of Financial Circumstances ("SOFC") which she did on 4 December 1990. In it she wrote in response to the question: "Is there anything else you think we should take into account in assessing your ability to repay this debt?"

"The fact that I made a phone call to your office not long after

starting employment yet your office has nothing on file to say that I

contacted you possibly within 14 days to let you know my income

details - did not get the ladies name to whom I spoke."

She signed the SOFC, declaring the information in it was correct. The SOFC included a warning that there were penalties for giving false information.

8. In a departmental file note subsequent to the SOFC, the following annotation appears:

"Conclusion: Even with lower rates of tax, client does not have

a capacity to pay more than $20.00 towards overpayment".

Although that note is undated it would appear, from its position in the T documents, to have been made in the first half of January 1991. No action seems to have been taken regarding relief, however, till 1 April 1991. On that date the rate of withholding, which had apparently been $42.00, was adjusted to $20.00 per fortnight. The following day according to a signed action endorsement appearing on a computerised print-out headed "Penalty Variation - Automatic" a penalty of a further $219 was added to the then existing amount of overpayment. A subsequent review of her financial circumstances recommended that withholding continue at the rate of $20 per fortnight.

9. On 3 October 1991 the respondent requested a review of the overpayment and particularly the relevant calculations. The decision to raise and recover the overpayment was affirmed by an authorised review officer on 17 December 1991. In a letter to the respondent dated 16 December 1991, the officer advised as follows:

"I am writing to you about my review of a decision of the Mirrabooka

Office on 27/11/90 to request recovery of an overpayment of sole

parents pension of $2120.80 for the period 21/6/90-19/7/90, 2/8/90-

16/8/90 and 11/10/90-8/11/90.

...

In making this decision, I applied the Act at Section 284

(notification requirements and Section 1224 (debts arising from

contravention of the Act).

...

Letters advising of your entitlement are sent in accordance with

Section 284 of the Act. On the reverse side of these letters, the

notification requirements specify the events that are to be notified

and the period within which notification is required by law to ensure

that no overpayment occurs.

The first event specified on these letters is:

'You must tell us if:

you... start paid work

or

you... start to receive income or your income increases above the rate

last notified.'

These letters also specify that the notification period is 14 days.

...

As you did not advise within 14 days of your rate of earnings I am

unable to change the decision regarding the overpayment. I therefore

affirm the decision to raise and recover this amount."

It may be noted that the officer relied on the provisions of the 1991 Act in relation to notification and liability and affirmed the original decision on the basis (different from the earlier advice of 27 November 1990) that the respondent had not advised the Department of her "rate of earnings" within 14 days. No explanation was offered about how the amount was calculated, nor whether departmental error or inaction was involved, nor was consideration given to whether hardship or any other circumstances warranted deferral or waiver.

10. The SSAT on 16 March 1992 set aside the decision. The SSAT substituted a decision that recovery of $853.80 be waived "on the grounds of administrative error in that the Department ... failed to act on information when provided" and that error contributed to a continuing overpayment after 25 september 1990. Recovery of the balance was written-off for 2 years due to severe financial hardship. Because the applicant, as the basis of its appeal, relies on certain suggested errors and inconsistencies in the reasoning of the SSAT, it is appropriate to set forth the relevant parts of the SSAT's decision. That tribunal stated:

"In considering the directions given by the Minister under Section

1237(3) the Tribunal applied itself to the question of special

circumstances, in particular in relation to Ms Lea's current financial

circumstances and the part played by the Department in protracting the

period of the overpayment.

When looking at the overpayment caused by the first two periods of

employment the Tribunal believes Ms Lea has breached the requirements

of the legislation in not advising of her employment within 14 days.

As such this portion of the overpayment should be recovered in full.

With regards to the overpayment attributable to her third period of

employment, the Tribunal accepts that Ms Lea telephoned the Department

within three weeks of commencing employment in September 1990 and when

her bank statement indicated the Department may not have actioned this

she recontacted them on 31 October 1990 and followed this up with

written advice. The Tribunal is satisfied from its discussions with Ms

Lea that she did contact the Department within three weeks and that

she also rang on 31 October 1991 even though there is no recorded note

of this contact either, but the Tribunal points to Ms Lea's letter

dated 31 October 1990 which is directed to a person called Wayne and

refers to a conversation on that day.

When dealing with the question of recovery, the Tribunal also had

regard to the financial circumstances of the client and in this

circumstance it is clear that Ms Lea is in desperate financial

troubles, and will be on a restricted budget for a long time. She

should however be able to stabilise her finances through employment,

given time.

The Tribunal therefore believes that the amount of overpayment

attributable to Ms Lea from October 1990 to November 1990 should be

waived on the grounds of administrative error in that the Department

of Social Security failed to act on information when provided. The

Tribunal is satisfied that Ms Lea acted in good faith and was not

aware that the monies had been credited to her account which was being

debited by the bank to an overdraft."

11. In exercising the power of waiver, the SSAT took the view that whilst it should apply the provisions of the Social Security Act 1947 ("the 1947 Act") in respect of issues of liability, it should follow the procedures of the 1991 Act, and particularly s.1237(1) in relation to waiver. Section 1237 relevantly provides:

"1237. The Secretary may, on behalf of the Commonwealth, decide to

waive the Commonwealth's right to recover from a person the whole or a

part of a debt.

(2) In exercising the power under subsection (1), the Secretary must

act in accordance with directions from time to time in force under

subsection (3).

(3) The Minister may, by determination in writing:

(a) give directions relating to the exercise of the Secretary's

power under subsection (1); and

(b) revoke or vary those directions.

(4) A determination made under subsection (3) giving, revoking or

varying directions is a disallowable instrument for the purposes of

section 46A of the Acts Interpretation Act 1901.

(5) A decision of the Secretary under subsection (1) takes effect:

(a) if no day is specified in the decision - on the day on which

the decision is made; or

(b) if a day is specified in the decision - on the day so specified

(whether that day is before, after or on the day on which the

decision is made).

Note: if the Secretary waives the Commonwealth's right to recover,

this is a permanent bar to recovery of the debt - the debt effectively

ceases to exist.

Further, in exercising the discretion to waive, the SSAT had regard to the Ministerial Determination dated 8 July 1990 ("the 1991 Determination") made under s.1237(3) of the 1991 Act, the relevant parts of which are set forth in paragraph 25 below.

12. Because it is critical to the findings now made by this Tribunal, the evidence of Ms Lea shall be dealt with first.

13. Mrs Lea, whom the Tribunal considers a truthful and honest witness and a responsible person, conceded that in respect of her employment with Quality Software and Hutton Langoulant MacRae she had failed to notify the Department within 14 days of commencing work as required by a notice issued under s.168 of the 1947 Act. The relevant Sole Parent Review forms notifying of her employment were received by the Department 22 days and 17 days respectively after she had commenced working on those two occasions, respectively.

14. Regarding her employment with the Department of Health, the respondent commenced work on 4 September and completed a Review Form on 9 September 1990. In response to question 6 of that form asking whether any paid work had been done in the past 12 weeks, the respondent ticked "No". She told the Tribunal that she had done so because she had not received any income from her employer at that time as her first fortnight's wage was to be withheld and paid to her when her employment ceased. She said she was confused by the question. She told the Tribunal that she had telephoned the Mirrabooka office of the Department after starting with the Department of Health to advise them of her employment. She thought that this had been in early September, about a week or two after she had commenced employment and a female officer whose name she had not obtained, informed her that the details would be entered onto the computer and she would receive written advice from the Department.

15. The respondent did not hear further about the matter for about one month. She became aware that full pension payments were still being made when she received a monthly statement of her bank account some time later. That account was in overdraft by an amount around $1000. She had not realised that payments of SPP had continued as her wage from the Department of Health was automatically deposited into a different account and she used the latter account to meet daily expenses. She said that at the time (ie at the end of October) she did not think she was entitled to the full payments of SPP that had been deposited into her account after commencing work and she telephoned the Mirrabooka office of the Department to make inquiries. The respondent spoke to an officer named Wayne who advised her that there was no record of her previous phone call and asked her to send her pay slips and confirm her situation in writing. Wayne also informed the respondent that she may have incurred an overpayment. There is no record in the documents furnished to the Tribunal of this conversation. In accordance with his instructions, she wrote to the Department a letter dated 31 October 19901, received on 2 November 1990, in the following terms:

"Dear Wayne,

As per my conversation with you on the phone today re my income since

starting work with the Dept. of Health enclosed are my last 4 pay

slips - My gross earning is 10.14 per hour - The Dept. have held back

2 weeks pay pending my leaving their employ therefore my earnings to

date is minus two weeks pay. If you have any queries please contact

Anna Rossi of the Women's Cancer Prevention Unit ... Also could you

please let me know as soon as possible regarding adjustments to my

pension.

Thank you

Yours sincerely,

(sgd) A M Lea"

16. The respondent provided the Tribunal with a statement of her financial position as at May 1992 (Exhibit 2) which she amended at the hearing in order to reflect her current situation to read:

Income Monthly estimated amount

$

Contract work salary 1,303

Family allowance ($23/fortnight) 50

Rent from teenage lodger 180

1,533

Expenses

Mortgage 708

Rates 67

Home insurance 45

Car running, registration and insurance 88

Bus fares (additional to above - re work) 52

Telephone 43

SECWA 55

School costs - books, fees, uniforms etc 34

Clothing 15

Term life insurance on respondent's life 23

(for son's security)

Loan repayments - Mastercard 115

Home Building Society 38

SUB-TOTAL 1,283

BALANCE 250

Also, the following pressing needs were assessed by the respondent:

Braces for son $2,000 167

Floor coverings $1,600 133

300

17. She had been working with Keith Huxtable of the Capita Financial Group for 4 years when she acquired a house with Homeswest in February 1990 after inheriting $12 000 which she used as a deposit on the land. One month after the house was completed she lost her job, leaving with her final wage and one week's additional pay. In her statement (Exhibit 2) she said:

"I underwent a near nervous breakdown with financial worry, and trying

to live on Social Security, in between working as a contract worker in

temporary positions, working long hours, not getting paid for sick

days, Xmas and Public holidays plus my son was having trouble settling

into High School and the ordeal of moving away from friends and moving

into a new house."

18. She lives with her son and a teenage lodger who pays her $180 per month. The respondent gave evidence that from the remaining balance of $250 per month, she provides food for herself, her son and the lodger. She attempts to save $25.00 each month for a Christmas fund account but is not always able. She has managed to reduce the overdraft of her bank account to around $680 and paid her income tax refund into her Mastercard account which she uses only to assist in meeting living expenses. Whenever possible she makes additional payments off the mortgage on the home which stood at around $75,500 even though the original loan borrowed in 1990 was $68,000, the difference being due to the previous low repayment level election which she was forced to make as the interest rate increased. She receives no financial support from her family as both her parents are deceased. In addition, to the orthodontic treatment that her son requires, which is estimated to cost $2000, floor coverings for the home are needed at a cost of $1600 and although she conceded that there is no real urgency, a fence needs to be erected on her property at an estimated cost of $1000.

19. At the time of the hearing, the respondent was working at the Department of Lands Administration on a three month contract, which was to end in early November.

20. The applicant's principal basis for seeking review is the contention that to the extent that it purports to be made under the relevant Ministerial Determination in force under s.1237(3) of the 1991 Act the decision of the SSAT is inconsistent within itself. Having regard to the fact that the overpayment arose in respect of three separate periods, to uphold the raising of an overpayment in respect of the first two periods but to waive repayment in respect of the third on the basis of departmental administrative error was inconsistent on the facts, there being no relevant distinction between the three periods. The approach of the SSAT also demonstrated a misunderstanding of paragraph (a) of the Ministerial Determination.

21. Paragraph (a) requires not only that there be administrative error, but also that it be the sole cause of overpayment, that it be accompanied by good faith on the part of the recipient, and that recovery would cause financial hardship. The applicant did not suggest that the respondent had acted in bad faith, but contended that neither of the other two elements had been established.

22. The applicant did concede that it was open to this Tribunal to take severe financial hardship into account when considering whether "special circumstances" existed so as to support the exercise of the power to waive. However, the applicant submitted the respondent's financial hardship was not sufficiently severe to constitute a special circumstance.

23. Regarding the applicant's contention that the SSAT wrongly applied paragraph 2(a) of the July 1991 Determination, it is far from certain that the SSAT did have regard to that paragraph. A close examination of the reasons of the SSAT1 discloses that though that Tribunal referred to administrative error in its decision, it did not do so by reference to paragraph (a); its reasons are equally consistent with the tribunal basing its decision on a finding of "special circumstances" within paragraph (g) (as it then was). Read in context, that appears to be the true ground of the SSAT's decision so there is no reason to find the SSAT misconceived the effect of paragraph (a).

24. Central to the applicant's submission is that the SSAT erred in its application of the 1991 Determination made pursuant to s.1237 of the 1991 Act. The 1991 Determination reads:

"...having regard to subsections 1237(2) and (3) of the Act which

require the Secretary of the Department of Social Security (the

Secretary) to act in accordance with directions issued by me from time

to time, I hereby direct that the power of the Secretary in section

1237 to waive the right of the Commonwealth to recover from a person

the whole or a part of a debt must, subject to the attached schedule,

be exercised in the following circumstances only:

(a) Where the debt was caused solely by administrative error on the

part of the Commonwealth, and was received by the person in good

faith, and recovery would cause financial hardship to the person.

...

(g) Where in the opinion of the Secretary special circumstances apply

such that the circumstances are extremely unusual, uncommon or

exceptional (as discussed by the Federal Court of Australia in Beadle

v. Director-General of Social Services [1984] AATA 176; (1984) 7 ALD 670)."

25. That Determination was revoked on 5 May 1992 and replaced by another Ministerial Determination of that date ("the 1992 Determination") which relevantly reads:

"2. ... I now direct, under paragraph 1237(3)(a) of the Act, that the

power of the Secretary to waive the right of the Commonwealth to

recover from a person the whole or part of a debt under subsection

1237(1) of the Act must be exercised in the following circumstances

and not in any other circumstances:

where the debt was caused solely by administrative error on the part

of the Commonwealth, and was received by the person in good faith, the

recovery of the debt would cause financial hardship to the person;

...

...

where, in the opinion of the Secretary, special circumstances apply

such that the circumstances are extremely unusual, uncommon or

exceptional;

..."

26. The applicant submitted the Tribunal should apply the latter Determination in relation to the exercise of the power to waive, it being the Determination in force at the time of hearing.

27. The Tribunal notes that apart from the reference to Beadle's case (which, except for importing the concepts of unfairness and appropriateness into the meaning of "special circumstances", can be ignored, paragraphs (a) and (g) of the former are effectively the same as paragraphs (a) and (d) of the latter. Given that substantially they are the same, for present purposes the Tribunal need not distinguish between them.

28. The significance of adopting one approach rather than the other lies in the fact that the ambit of the discretion to waive is more restricted under the two Determinations than under s.251 of the 1947 Act. No Ministerial Determination was made affecting the latter. On the other hand, it is apparent from the terms of the two Determinations that they are intended to set limiting conditions upon the exercise of the power under s.1237(1) of the 1991 Act itself. 2Thus in relation to the 1992 Determination, the exercise depends on a finding that as a matter of objective fact one of paragraphs 2(a), (b), (c), (e), (f) or (g) is satisfied, or that under paragraph 2(d) the Secretary or his delegate forms the opinion that there are "special circumstances" which are "extremely unusual, uncommon or exceptional". The formation of such opinion is the gateway to the field in which the discretion operates. Once that pre-condition is fulfilled, the Secretary - and in this instance, the Tribunal - as a secondary step must then have regard to those special circumstances in determining whether it is appropriate that the discretion should be exercised.

29. Before the Tribunal proceeds to determine whether the decision of the SSAT in respect of waiver should be affirmed, set aside or varied in accordance with s.1237(1) as modified by the 1991 Determination, three prior questions must be addressed:

(a) What in terms of its elements is the decision under review, and

when was it made?

(b) Is the respondent liable to repay a debt due to the Commonwealth

under s.246 of the 1947 Act, and if so, how much?

(c) Is the power to waive located in s.1237(1) of the 1991 Act, and if

so, is the Tribunal bound to take either Determination under s.1237(3)

of the 1991 Act into account when determining whether to exercise the

power to waive?

30. Although it was not until 17 December 1991 that the decision made by an officer of the Department on 27 November 1990 to seek recovery of the amount overpaid was reviewed, notwithstanding the respondent's earlier representations questioning liability and seeking relief, the Tribunal finds that it was the decision in November that is effectively the decision under review. It is the basis upon which liability to repay the debt to the Commonwealth was founded and the action to recover by way of withholdings from the respondent's pension was instituted.

31. Despite the view of the ARO that the respondent's debt arose under s.1224 of the 1991 Act, it is clear that the proper basis of liability in this case was s.246 of the 1947 Act which relevantly provides:

"Where, in consequence of a false statement or representation, or in

consequence of a failure or omission to comply with any provision of

this Act, an amount has been paid by way of pension, allowance or

benefit under this Act which would not have been paid but for the

false statement or representation, failure or omission, the amount so

paid is a debt due to the Commonwealth.

Notwithstanding anything contained in this Act, where -

an amount has been paid by way of pension, benefit or allowance under

this Act that should not have been paid;

...

...

...

and the person to whom that amount was paid is receiving or is

entitled to receive, a pension, benefit or allowance under this Act

that amount (including any amount payable by the person under

subsection (3) shall, unless the Secretary takes action under

subsection 251 in relation to that amount, be deducted from that

last-mentioned pension, benefit or allowance by reducing each payment

of that pension, benefit or allowance by a proportion of that pension,

benefit or allowance, being a proportion decided by the Secretary in

each particular case, until the sum of the amounts by which the

payments are reduced equals that amount.

..." (emphasis added)

32. Section 246(1) in stipulating that the debt to the Commonwealth be "in consequence of" a failure or omission to comply with that Act, and that the amount would not have been paid but for that failure or omission, requires a causal connection to be established between the relevant failure or omission to comply with that Act and the incurring of the debt.

33. In Secretary, Department of Social Security v. Greenwood French J. observed, that it is sufficient, in order to establish the causal connection posited by s.246(1), that the failure or omission of a recipient was a contributory cause to the overpayment alleged. He accepted that the Tribunal in Re Greenwood and Secretary, Department of Social Security had enunciated the correct legal principles regarding causation in relation to s.246(1). In that decision, dealing with the "but for" test the Tribunal stated:

"20. ...In this respect observations made by the High Court in March

v. E and M Stramare Pty Ltd [1991] HCA 12; (1991) 99 ALR 423 about the "but for"

test in the context of a negligence action are instructive. Whilst

the Tribunal needs to be cautious about drawing analogies from a

different area of law, the caution demonstrated by their Honours in

regard to the use of the "but for" test in determining issues of

causation in negligence are of guidance to this Tribunal when dealing

with the statutory formula in question. As pointed out by Mason C.J.

(at p 425):

"It has often been said that the legal concept of causation differs

from the philosophic and scientific notions of causation."

21. After pointing out (at p 429) that in many situations the question

of whether "Y" is a consequence of "X" is a question of fact, he

concludes (at p 431) that the "but for" test does not provide a

satisfactory answer in those cases in which a superseding cause,

described as a novus actus interveniens, is said to break the chain of

causation which would otherwise have resulted from an earlier wrongful

act. Similarly, Deane J. (at p 435) observed that:

"The mere fact that something constitutes and essential condition

(in the "but for" sense) of an occurrence does not mean that, for the

purposes of describing responsibility..., it is properly to be seen as

a "cause" of that occurrence as a matter of ordinary language or

common sense." (emphasis added)

22. Toohey J., also (at p 436) indicated that he shared the Chief

Justice's view that the "but for" or "causa sine qua non" test should

not be a definitive theory of causation where negligence is alleged.

McHugh J. (at p 441) emphasised that issues of causation (in the

context of negligence) cannot be decided on the basis of logic or by

the application of a scientific of philosophical theory of causation.

Conclusions of causation need to be based "upon a rule that enables

the Tribunal of fact to make a value judgment that in the

circumstances legal responsibility did not attach to the defendant

even though his or her act of omission was a necessary precondition of

the occurrence of the damage." (emphasis added)

More recently, Mason C.J., Deane J. and Toohey J. commented in Bennett v. Minister for Community Welfare (WA):

"In the realm of negligence, causation is necessarily a question of

fact to be resolved as a matter of commonsense. In resolving that

question, the "but for" test, applied as a negative criterion of

causation, has an important role to play but it is not a comprehensive

or exclusive test of causation; value judgments and policy

considerations necessarily intrude."

34. In the present case, the applicant contends that the respondent's liability under s.246(1) arose because she failed to comply with requirements set forth in the letter of 19 June 1990 as well as the notice set forth in small print on the back thereof. Section 163, as it then was, of the 1947 Act required such compliance. The applicant, somewhat confusingly, has relied upon two different failures to comply. In the letter of 27 November 1990 it was the respondent's failure to advise the Department within 14 days of undertaking employment. In the letter of 16 December 1991 it was the failure to notify changes in the rate of earnings. It was, according to the applicant, firstly, in consequence of one or other of those failures that the overpayments in question were made and secondly, they would not have been made but for the respondent's failures. The Tribunal therefore turns to the question whether those two pre-conditions were established. To determine that question, it is necessary to consider how the applicant's recovery procedures operated.

35. In order to assess whether the failure of the respondent to notify her undertaking employment and the receipt of income in excess of $52 per week, within the 14 day period contributed to or caused the overpayment, the Tribunal sought evidence about the way in which the Department dealt with notifications of that kind. Mr Swerissen, when asked whether it was a common occurrence for a recipient of an overpayment of over $2,000 to be advised 4-5 months at least after the process of incurring an overpayment had begun, stated that in accordance with the current practice of the Department an overpayment should be raised within 42 days of its detection. At the time when the present overpayment arose he was uncertain as to whether there were any specific guidelines but having worked in regional offices, he was aware that there were occasions when it would have been up to 12 months "down the track" before an overpayment was actually raised.

36. Ms Irene Walker, an officer of the Department with knowledge of recovery procedures, having familiarised herself with the respondent's file, said that the form returned by Ms Lea on 19 August 1990 had gone from the Perth West Office of the Department, after receipt and had been received at the Mirrabooka Office on 20 August 1990. It was then "actioned" and an overpayment detected on 4 September 1990. At that stage all that had happened was that the office had established that there was an overpayment. It was not, however, the Department's practice to raise an overpayment without receiving further information. The practice at the time was to send out an employer's report form. This may take some time to be returned. In the meantime an overpayment would not be raised. Asked why, once it was evident and verified by 17 September 1990 there had been an overpayment, no steps were taken to do anything about it until after another two months, Ms Walker said that by that time another overpayment must have been detected and instead of just raising the one overpayment they would look at all the overpayments and raise them as one. She agreed that instead of putting the respondent in a situation of not knowing that she was in debt and would therefore have to make provision for recovery, the matter was allowed to go on until the full amount was known. In fact the witness confirmed that it was not departmental practice to notify people about possible overpayments. She also conceded that in such instances there would be no reduction in pension upon first detection. This would not occur until the overpayment was established and raised. If a recipient of pension did notify the Department within 14 days that they were receiving income the Department would not seek recovery in respect of the first 14 days but every payment thereafter would be treated as recoverable overpayment paradoxically the Tribunal finds it difficult to understand how, in these circumstances, there could be an overpayment except for administrative error.

37. In the light of this evidence the Tribunal finds that:

(i) Although the possibility of an overpayment was evident at 4

September 1990 there was no notification given to the respondent

about the consequences.

(ii) Even if the respondent had notified the Department within 14 days

of commencing employment in each instance, and further that she was

receiving income at a rate higher than $52 per week, it would not have

prevented the overpayment arising. Consistent with departmental

practice, overpayments would have continued to be incurred for several

months, even where the Department was aware of such a possibility.

During that time decisions were taken to make further enquiries from

employers and there was further delay whilst those enquiries were

proceeding. It was unlikely that a warning or advice would have been

given to the respondent prior to recovery being sought.

(iii) Notification of notifiable events within 14 days would only be

taken into account insofar as recovery would not be sought in respect

of an overpayment arising during that first 14 day period.

(iv) Even if she had given such notification, no adjustments would

have been made to the level of pension being received by the

respondent until the amount of overpayment had been assessed.

The Tribunal makes no finding, however, about whether the Department failed to act on the phone call which the respondent says she made to an officer in early September 1990. There is no departmental record of this, which is equivocal, and though the Tribunal accepts that she did contact the Department, probably in September, the details are too vague to make any reliable findings. The Tribunal also notes that the respondent did not at any time advise the Department that her "income exceeded $52 a week" in those specific terms. Where she did provide details of earnings and pay slips, as in her letter of 31 October 1990, it did not evoke an immediate or prompt response from the Department. Also, when it received advice that she was earning, the Department did not seek specific details from her about the rate. Accordingly, the Tribunal is not satisfied that her failure to give more accurate details of the rate of her income contributed to the overpayment.

38. The fact that notification of the relevant information with 14 days would have made no difference to the Department's continuing to pay pension at the full rate, is borne out by the fact that in each instance notification was made only a matter of a short time after the 14 day period had expired. Departmental procedures were the same no matter when notification was made. In relation to the June-July overpayment notification it was 10 days outside the period and only 3 days outside in the case of the August overpayment, whilst on the evidence of the respondent, which was vague on the point, notification in relation to the September-October overpayment could well have occurred within the 14 days, but more likely was three weeks after commencing work. It is therefore difficult to see how the failure to notify of any relevant circumstance within 14 days would have affected the outcome, given the departmental practice at the time. The juggernaut would still have rolled on irrespective of the breach of the notice under s.163 of the 1947 Act. Given those circumstances it is difficult to see how the debt to the Commonwealth arising from the overpayments in the second and third employment periods could be said to be "in consequence of" the failure to give the necessary particulars nor that the overpayment would not have occurred "but for" her omission to notify in time. Had the respondent informed the Department in time it would not, on the evidence, have prevented the overpayment of pension. Her failure was irrelevant to the outcome. The first period raises some slight difference in that she did commence work on 17 June 1990 prior to first receipt of pension on 21 June 1990 but there is nothing in evidence from the respondent's officers to suggest that any different outcome would have followed. The Tribunal sees no reason to differentiate between the three periods of employment. The Tribunal therefore finds that her failure to notify did not contribute to the incurring by the Commonwealth of the debt under s.246(1) and she is not therefore liable on that account.

39. That however is no answer to the fact that she has been paid amounts to which she is not entitled (ie. that "should not have been paid"). Though she is not liable for a recoverable debt (ie. one for which the Commonwealth may sue) the Commonwealth was nevertheless entitled under s.246(2) of the 1947 Act to withhold pension by way of deductions from time to time according to whether she was in receipt of any benefit. A distinction should be drawn in this regard between a "debt" and an amount which, though not a "debt" in the statutory sense, still may be recoverable by way of withholdings of pension. Both fall within the concept loosely described as "overpayments". Accordingly the Tribunal must decide whether the whole or any part of the amount which the Commonwealth may offset against her current or future payments of pension should be waived. This requires the Tribunal to determine under what provision the amount liable to deduction can be waived, and if it is s.1237(1) of the 1991 Act, whether either of the Determinations apply.

40. Views differ about whether in a situation where a debt was incurred within s.246 of the 1947 Act the decision to waive should be made under s.1237 of the 1991 Act, requiring the decision-maker to have regard to the Determination in force at the time when the decision to waive is made. In Re Secretary, Department of Social Security and Bradley the Tribunal constituted by O'Connor J. (President) Ms G Ettinger and Ms P Smith (Members) decided that where a person has incurred liability under s.246, an integral part of that liability was that it could be waived in accordance with the law in force at the time the liability was created. In a case such as Re Bradley, where the decision to recover was made prior to the coming into operation of the 1991 Act, this means that the power to waive would be under s.251 of the 1947 Act. It would therefore not be subject to any Determination made under the 1991 Act. In the absence of any determination the principles to be applied in such a case should be those indicated by the Full Federal Court in Director-General of Social Services v. Hales. Whilst not an exhaustive statutory code, these include:

the fact that the applicant has received public moneys to which he or

she was not entitled;

the way in which the overpayment arose, whether as a result of

innocent mistake or fraud;

the financial circumstances of the prospective defendant;

the prospect of recovery;

whether a compromise is offered;

whether recovery should be delayed if there is a prospect that the

circumstances of the person who received the overpayment may improve;

compassionate considerations and the fact that the Act is social

welfare legislation and any financial hardship which may result from

an action for recovery.

41. Re Bradley has been followed in a number of recent Tribunal decisions.

42. A different view of the effect of the Determinations was taken in Re Secretary, Department of Social Security and Edwardes which has also been applied in other decisions. In Hodgson the Court appears to have proceeded on the assumption that the 1991 Determination was applicable in that case, though no submission appears to have been made about whether that was the correct course.

43. In this instance, the Tribunal does not propose to add to the debate by conducting its own analysis of the provisions in question. It is mindful of the need for consistency in decision-making on the part of the Tribunal unless it is convinced that a particular decision or line of authority is wrong or there is a sound basis for distinguishing one case from another. In this case, the facts are on all fours with the position in Bradley. The latter is a decision in which the Tribunal included the President. In the absence of any Federal Court decision to the contrary, this Tribunal adopts the principles enunciated in Bradley. If it is satisfied that in having regard to the kind of considerations that were indicated to be relevant in Hales the Tribunal need not, as a preliminary exercise, decide whether, if it finds special circumstances exist, it must also find that the circumstances are extremely unusual, uncommon or exceptional.

44. There is no suggestion that monies overpaid to the respondent were obtained by any fraud or deceit on her part. What is put against her is that she did not comply with the notice under s.163. As noted above, her failure to do so was only by a matter of days in the case of the first and second periods of employment, and with respect to the third period she may well have complied, but if she did not, her default would only have been in the order of about a week. As a matter of seriousness, her shortcomings in this respect, whilst forgetful or negligent, fall well short of displaying any moral turpitude or gross negligence that would weigh heavily against waiver. In fact, as observed above, her failure to comply was, effectively, of no material significance.

45. The applicant for its part, whilst insisting on strict compliance, apparently adopts a different standard in relation to its own actions. If the purpose of the 14 days notification is to ensure that timely action is taken to prevent overpayment, its system certainly failed to achieve that objective. Nor does it allow the unwitting recipient much scope to prepare for later adjustments in pension or repayment. It could be contended, however, that the respondent should have become aware at an earlier stage of the fact that she was continuing to receive pension and she therefore should have alerted the Department sooner, perhaps even before she started to be employed. This again runs into the objection that it is questionable whether it would have altered the Department's practice at the time. In this respect, regard must be had to the fact that pension was being paid into an account of the respondent which was in an overdraft situation. It was therefore not immediately apparent to her that she was in receipt of excess payments. The Tribunal would comment that the warnings themselves are far from explicit and those appearing on the back of the letter of 19 June 1990 are apt to be confusing.

46. As a matter of whether the original decision was fair, she quite rightly feels that she had little to do with bringing about the situation of overpayment. In this respect the Tribunal puts considerable weight on the fact that although the Department had evidence as early as 9 August 1990 that the respondent had probably received monies to which she was not entitled, and by 3 September 1990 has certainly confirmed that fact, it was not till late November that it took any steps to formally notify her. By that time the overpayment was over $2,000. This situation must be regarded as unusual when compared with normal commercial debt practice.

47. It should be said by way of concession that it is understandable why the Department seeks information to verify whether there has in fact been an overpayment and if so, by how much, before it disrupts receipt of benefits. The problem in a case like the present is the length of time it took to act to prevent or minimise overpayment of pension.

48. A further relevant factor that the Tribunal must consider is the respondent's financial situation. The Department itself has recognised that to date her situation has been fairly precarious and to that end has reduced withholdings from her pension to a fairly minimal figure of $20 per fortnight. From the information set forth above and from her evidence, the Tribunal is satisfied that she is in fairly stringent circumstances. This is so even though some liabilities such as for construction of the fence can be deferred. She undoubtedly is a capable person who is able to find employment from time to time in short bursts but this barely allows her to accumulate much more than is necessary to pay her substantial financial commitments. She is attempting to bring up a teenage son alone. Though Mr Taylor in cross-examination sought to establish that orthodontic treatment required by her son was not a matter of necessity and could be deferred, the Tribunal is not so sanguine. Matters of health can be taken into account as a matter of special circumstances. The Tribunal is satisfied that the treatment is necessary and will involve a substantial financial commitment. The respondent is also likely to experience difficulties maintaining repayments for the house that she has purchased. She undertook commitments in that respect at a time when she was in stable employment and now in these harsh economic times naturally experiences difficulty keeping up her repayments. The Tribunal is satisfied that whilst by no means as desperate or stringent as many of the cases that come before it, the financial circumstances of the respondent tend towards the severe insofar as her expenditure is almost entirely directed towards necessities. Her home mortgage, rates and insurance costs amount to $190 per week which is not excessive. Any reduction in her financial capacity will result in some form or other of deprivation with a real potential for increased stress and impact on her health.

49. The Tribunal accepts that the respondent has had the advantage of public monies to which she was not entitled. Though she made no immediate direct use of it, these did contribute to reducing her overdraft and this is a factor that should be taken into account in balancing the various considerations that affect the decision whether to waive.

50. In all of the circumstances the Tribunal agrees with the outcome envisaged by the SSAT's decision, that the amount of $853.80 be waived; it is a fair result and the Tribunal independently reaches the same general conclusion. However, certain aspects require clarification. In the first place the Tribunal decides that, as to liability, for the reasons given above, the respondent incurred no recoverable debt under s.246(1) of the 1947 Act. The Tribunal decides, secondly, that the respondent has been paid an amount of $2,120.80 to which she was not entitled in respect of the three periods in which she was employed. By virtue of the latter, the Commonwealth was entitled to recover that amount by way of withholdings under s.246(2) of the Act. On the basis of the decision in Bradley that amount is amenable to waiver under s.251 of that Act. In respect of that amount the Tribunal, thirdly, decides that the amount of $853.80 in respect of the third period (viz. between 27 September 1990 and 8 November 1990) should be entirely waived. This is on the basis that by that point of time, the applicant should either have instituted withholdings or if it were not prepared to do so, at least have informed the respondent of its intentions.

51. Fourthly, with respect to the further amount of $219 applied by way of penalty, the Tribunal decides that it too should be waived. It was imposed mechanically by operation of the 1947 Act at a time when she was financially unable to repay the amount claimed under a debt that the Tribunal has found should not have been raised under s.246(1).

52. Finally, with respect to the amount of $1,267 (ie. $2,120.80 less $853.80 waived) which the Commonwealth is entitled to recover by way of withholdings, the Tribunal is of the opinion that no action to institute withholdings to recover the balance of that amount, after deducting past withholding, should be pursued for a period of 2 years following the date of decision of the SSAT. It sets aside, however, the decision of the SSAT that the balance of the debt be written-off for 2 years simply on the technical ground that a debt cannot be written-off for a discrete period. Thereafter the applicant might decide to recommence withholdings at an appropriate rate, having regard to the respondent's financial circumstances at that time. The applicant will also be in a position then to determine whether having regard to the practicality of long-term recovery, any portion of the remaining amount recoverable by way of withholdings should be written off.