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[2005] FCA 866
Federal Court of Australia
2005-06-28
Branson J
Original judgment source is linked above.
introduction 1 The applicant has appealed from a decision of the Administrative Appeals Tribunal ('the Tribunal') under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) ('the AAT Act'). 2 Section 44 of the AAT Act empowers a party to a proceeding before the Tribunal to appeal to the Court 'on a question of law' from a decision of the Tribunal. As was observed in Birdseye v Australian Securities and Investment Commission (2003) 76 ALD 321 at [21] the question of law stated in the notice of appeal from a decision of the Tribunal is the subject matter of the appeal under s 44 of the AAT Act. 3 The applicant, who conducted her appeal without legal representation, understandably experienced difficulty in identifying the question or questions of law on which she brought her appeal. After giving careful consideration to the original notice of appeal filed by the applicant, and to an amended notice of appeal subsequently filed by her, I formed the view that the only question of law that was raised by those two documents was the following: What is the true meaning of the expression 'special circumstances (other than financial hardship alone)' in par 1237AAD(b) of the Social Security Act 1991 (Cth)? 4 If the answer to this question of law leads to a conclusion that the Tribunal did not properly understand and apply the paragraph, the applicant may be able to establish that the decision of the Tribunal should be set aside and her matter remitted to the Tribunal for consideration according to law. 5 The applicant and the respondent agreed that this appeal should be determined on the basis that it is an appeal on the above question. 6 For the reasons set out below I have concluded that the appeal should be dismissed.
statutory provisions 7 Subsection 1223(5) of the Social Security Act 1991 (Cth) ('the Act') provides: 'If: (a) an amount (the received amount) has been paid to a person by way of social security payment on or after 1 October 1997; and (b) because the received amount had not been correctly calculated using the relevant rate calculator, or for any other reason, the received amount is greater than the amount (the correct amount) of social security payment that should have been paid to the person under this Act; the difference between the received amount and the correct amount is a debt due to the Commonwealth.' 8 Section 1231 of the Act relevantly provides, in effect, that a debt under the Act must be deducted from a person's social security payment in the way authorised by that section unless the Secretary takes action under Part 5.4 in relation to the amount. 9 Part 5.4 of the Act, which is comprised of ss 1235‑1237B, is headed 'Non‑recovery of debts'. Subsection 1237(1) provides that, on behalf of the Commonwealth, the Secretary may waive the Commonwealth's right to recover the whole or a part of a debt from a debtor only in the circumstances described in certain sections of the Act of which s 1237AAD is one. 10 Section 1237AAD of the Act provides: '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 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.'
background facts 11 The applicant is a 55‑year‑old woman who was formerly in receipt of a widow allowance. The respondent is of the view that the applicant received an amount by way of a social security payment (ie widow allowance) during 2000 that was greater than the amount of social security payment that should have been paid to her under the Act (see s 1223(5) of the Act). 12 The applicant applied to the Social Security Appeals Tribunal ('the SSAT') for review of a decision to recover an amount of $845.87 from her as a debt arising from overpayments allegedly made to her in respect of the period from 3 August 2000 to 21 November 2000. The SSAT took the view that it had not been established that the applicant did not correctly declare her earnings in the period up to 8 September 2000. However, the SSAT found that the applicant did not declare her earnings in the period from 14 October to 21 November 2000 and consequently received overpayments of social security. The SSAT did not identify any administrative error made by Centrelink that led to the payments. It was satisfied that Centrelink had correctly calculated that for the period from 14 October to 21 November 2000 the applicant was overpaid an amount of $683.07. The SSAT concluded that repayment of the applicant's resultant debt to the Commonwealth could not be waived under s 1237AAD of the Act. 13 The applicant applied to the Tribunal for review of the decision of the SSAT. 14 The reasons for decision of the Tribunal record that the applicant provided no evidence or other material to refute the updated calculation then made by the respondent that indicated that the applicant owed a debt to the Commonwealth arising from overpayments of widow allowance in the amount of $777.22. On this basis the Tribunal identified the question before it for decision as whether the debt of $777.22 should be recovered from the applicant. 15 The Tribunal reviewed the applicant's financial and personal circumstances. It noted evidence that she was experiencing difficult financial circumstances in Australia. It also noted evidence that she suffers from arthritis in her hands and has high blood pressure for which she takes medication. Further, the Tribunal noted that the applicant was scheduled to have an operation on her eyes in July 2005. 16 The Tribunal was satisfied that the applicant's circumstances, which include that she owns a home in the Philippines valued in 1992 at approximately $680,000, were such that the Secretary could not decide to write off the applicant's debt to the Commonwealth. The applicant understandably does not challenge this aspect of the decision of the Tribunal. 17 The applicant invited the Tribunal to conclude that the Commonwealth's right to recover the debt should be waived on the basis of possible administrative error or because of the day‑to‑day hardship that she faces due to her ill‑health and her current financial situation. 18 The Tribunal did not accept that the overpayments to the applicant had been the result of administrative error. The applicant has not suggested that any error of law affects this aspect of the Tribunal's decision. 19 On the issue that is critical to this appeal, that is the discretion of the Secretary to waive the right to recover all or part of the debt under s 1237AAD(b), the Tribunal observed: 'The final section that is open to me to consider is 1237AAD of the Act which provides for a discretionary power to waive part of or all of a debt in "special circumstances". As explained in the case "Re Beadle and Director General of Social Security" [1984] 6 ALD 1 [the applicant's] circumstances must be "unusual, uncommon or exceptional" in order to qualify as "special". While her circumstances may be difficult, they do not differ from those of many income support recipients.' 20 In my view, it is apparent from the above observations of the Tribunal that the Tribunal reached the conclusion that the applicant's circumstances do not relevantly differ from those of many income support recipients.
question of law 21 In Beadle v Director‑General of Social Security (1985) 60 ALR 225 ('Beadle') the Full Court of this Court gave consideration to s 102(1)(a) of the Act as then in force. At that time s 102 fixed the time at which a family allowance granted to a person was payable. Under s 102(1)(a) a family allowance was payable - 'if a claim is lodged within 6 months after the date on which the claimant became eligible to claim the family allowance, or, in special circumstances, within such longer period as the Director‑General allows - from the commencement of the next family allowance period after that date.' (emphasis added) 22 The Full Court in Beadle at 228 observed: 'As we have seen the Director-General in acting under s 102(1) is concerned with the period between the date a claimant became eligible and the time when the claim was lodged. The legislature has indicated that six months latitude is sufficient in the normal case. The Director-General has power to fix a longer period in special circumstances. Presumably in this context special circumstances must include events which would render the six months unfair or inappropriate. For example, where the delay beyond six months was due to the claimant's being misled by a departmental officer or was due to the negligence of a third party it might be thought the normal six months would be inappropriate; that special circumstances had been shown which warranted a longer period. More difficult would be questions of ignorance, illiteracy, isolation illness and the like. It would depend upon 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 precision, is sufficiently understood in our view not to require judicial gloss.' 23 The approach adopted by the Full Court in Beadle is similar to the approach adopted by the Court in applications made under O 52 r 15(2) of the Federal Court Rules. Order 52 r 15(2) authorises the Court or a Judge 'for special reasons' at any time to give leave to file and serve a notice of appeal. In Jess v Scott (1986) 12 FCR 187 at 195 the Full Court stated: 'What is needed to justify an extension of time is indicated in r 15(2) by the words "for special reasons". It is that there be shown a special reason why the appeal should be permitted to proceed, though filed after the expiry of twenty‑one days. In that context, the expression "special reasons" is intended to distinguish the case from the usual course according to which the time is twenty‑one days. But it may be so distinguished (not necessarily will, for the rule gives a discretion) wherever the Court sees a ground which does justify departure from the general rule in the particular case. Such a ground is a special reason because it takes the case out of the ordinary. We do not think the use of the expression "for special reasons" implies something narrower than this.' 24 The intended effect of s 1237AAD has been considered by French J in Secretary, Department of Social Security v Hales (1998) 82 FCR 154 ('Hales') at 162 where his Honour observed: 'The concept of special circumstances is broad. A constellation of factors, including financial circumstances, may fall within it. The express exclusion of financial hardship alone as a special circumstance is an indicator that it would otherwise be included. This gives some measure of the range of circumstances which will qualify as special. … … The evident purpose of s 1237AAD is to enable a flexible response to the wide range of situations which could give rise to hardship or unfairness in the event of a rigid application of a requirement for recovery of debt. It is inappropriate to constrain that flexibility by imposing a narrow or artificial construction upon the words. …' 25 In my view, the Tribunal probably overstated the significance of the requirement in s 1237AAD(b) for 'special circumstances'. The Full Court in Beadle did not endorse the view expressed by the Tribunal in Re Beadle and Director‑General of Social Security (1984) 6 ALD 1 at 3 that circumstances are special only if they are 'unusual, uncommon or exceptional'. 26 However, the Tribunal concluded that the applicant's circumstances 'do not differ from those of many income support recipients'. In the context in which the Tribunal reached this conclusion, it is to be understood as having made a judgment that neither hardship nor unfairness made it desirable to waive all or part of the applicant's debt because the applicant's circumstances were common‑place rather than special. While, as French J pointed out in Hales, the evident purpose of s 1237AAD is to enable a flexible response to the wide range of circumstances which could give rise to hardship or unfairness, the statutory requirement for 'special circumstances' discloses an intention to proscribe waiver in ordinary cases. The hardship or unfairness to which French J referred must be understood to be hardship or unfairness sufficient to justify departure from the general rule in the particular case.
conclusion 27 While the language of the Tribunal in this case was somewhat infelicitous, I am not satisfied that the Tribunal failed to apply properly s 1237AAD of the Act. The appeal will therefore be dismissed. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Branson.
Solicitor for the Respondent: Australian Government Solicitor
Ryde
Secretary, Department of Family and Community Services
(1985) 60 ALR 225
(1986) 12 FCR 187
(1998) 82 FCR 154