Vranic v Secretary, Department of Education, Employment and Workplace Relations

REASONS FOR JUDGMENT 1 The respondent, the Secretary of the Department of Education, Employment and Workplace Relations, by Notice of Motion seeks an order that the application of Mrs Ljubica Vranic ("Mrs Vranic") made to this Court pursuant to s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) be dismissed on the footing that it fails to disclose a cause of action (O 11 r 16 of the Federal Court Rules)); Mrs Vranic has no reasonable prospect of successfully prosecuting the proceeding (s 31A(2) of the Federal Court of Australia Act 1976 (Cth)); the application for relief is frivolous or vexatious; and the proceeding is an abuse of the process of the Court (O 20 r 5). 2 The uncontested background matters are these. 3 Mrs Vranic applied for and obtained a social security benefit under the Social Security Act 1991 (Cth) (the Act) described as Newstart allowance which she began to receive on 1 January 1998. She was paid a Newstart benefit from that date until 17 October 2007 at the rate prescribed by the Act. 4 On 18 October 2007, Mrs Vranic departed from Australia. She ceased to be paid a Newstart benefit. After 185 days she returned to Australia on 19 April 2008. On 21 April 2008, Mrs Vranic notified Centrelink of her intention to claim a Newstart allowance. On 28 April 2008, Mrs Vranic's application was accepted and she was granted an entitlement to Newstart benefits from 21 April 2008. The rate of benefit paid to her was determined by Centrelink to be the rate prescribed by "Benefit Rate Calculator B, Module B", for the purposes of s 1068 of the Act. Section 643 of the Act provides that a person's Newstart allowance rate of benefit is to be calculated using Benefit Rate Calculator B contained in s 1068 of the Act. Section 1068(1) provides that the rate of Newstart allowance for a person who has reached the age of 18 years (Mrs Vranic's position) is to be calculated in accordance with the "Rate Calculator" at the end of that section. Module B of the Rate Calculator set out at s 1068 - B1 of the Act contains Table B, which prescribes the maximum basic rate of benefit payable to such a person. The maximum rate of benefit payable to Mrs Vranic was determined by Centrelink as at the date of her application for the benefit, to be that prescribed by clause 4B of Table B which provided, at the relevant date, that a person who is not a member of a couple, and who: (a) receives newstart allowance …; and (b) has turned 60; and (c) has not been receiving one, or a combination, of social security pension, social security benefit or job search allowance or service pension or income support supplement for a continuous period of at least 9 months is $437.10 per fortnight. (Emphasis added). 5 Clause 5 of Table B provided, at the relevant date, that the maximum rate of benefit payable to a person who is not a member of a couple and who: (a) has turned 60; and (b) has been receiving one, or a combination, of social security pension, social security benefit or job search allowance or service pension or income support supplement for a continuous period of at least 9 months is $472.80 per fortnight. (Emphasis added). 6 Since Mrs Vranic was a person who was receiving Newstart allowance on 21 April 2008 and who on that date was characterised by Centrelink as a person who "has not been receiving a social security benefit [relevantly here a Newstart allowance] for a continuous period of at least 9 months", Centrelink determined that the maximum rate of benefit payable to her was $437.10 per fortnight. Mrs Vranic received Newstart allowance at that rate for a period of nine months until 22 January 2009 when, by operation of clause 5 of Table B, she commenced being paid the allowance at the higher rate of benefit prescribed by clause 5 of Table B. 7 The rates prescribed by clauses 4B and 5 of Table B are subject to periodic increments. For example, the clause 5 higher rate for the period 20 September 2008 to 31 December 2008 was $486.00 per fortnight rather than $472.80. 8 The difference between the higher and lower rates at the date of Mrs Vranic's application for Newstart allowance was $35.70. 9 Mrs Vranic says that she has been deprived of that differential amount for nine months, which in the aggregate amounts to approximately (subject to increments over the nine-month period) $910.00. 10 Mrs Vranic's central contention is that on 21 April 2008 she was entitled to be paid Newstart allowance at the higher rate of $472.80 (with applicable increments) because she had, during the period 1 January 1998 to 17 October 2007, continuously received Newstart allowance. Thus, it follows, she contends, that she has received Newstart allowance for "a continuous period of at least 9 months" which satisfies the requirements of item (c) of clause 5 and qualifies her for the higher rate of benefit. 11 On that footing, Mrs Vranic sought on 24 June 2008 review of the initial decision to pay her a maximum benefit under clause 4B of Table B, before an Authorised Review Officer for such decisions. On 22 July 2008, the decision was affirmed. Mrs Vranic sought review before the Social Security Appeals Tribunal (the "SSAT") and on 9 September 2008, the SSAT affirmed the decision under review. On 12 September 2008, Mrs Vranic sought review before the Administrative Appeals Tribunal ("the Tribunal"). The Tribunal determined that clause 4B of Table B applied so as to determine the maximum rate of benefit payable to Mrs Vranic because, as to item (c) of clause 4B, she was a person who "has not been receiving … a social security benefit [Newstart allowance] … for a continuous period of at least 9 months". The break in continuity caused by Mrs Vranic's 185-day absence from Australia had the result that at the date of her fresh application for Newstart allowance on 21 April 2008, she had not been in receipt of a social security benefit for a continuous period of at least nine months prior to her application. 12 The Tribunal further noted that s 38B of the Act addresses the circumstances in which a person is taken to have received a social security benefit in respect of a continuous period even though the person did not actually receive such a payment during a part or parts of the period. Section 38B(2) of the Act defines a continuous period in respect of the receipt of a social security benefit as a period that starts on a day of receipt of a benefit and ends on a day of receipt of a benefit. In other words, in determining a continuous period of receipt of payments, no period of non-receipt of payments forms part of a continuous period unless, the non-receipt period is taken to form part of a continuous period by operation of the sub-sections of s 38B of the Act. Section 38B(3) is one such sub-section by which a period of non-receipt of not greater than six weeks is taken to have been a continuous receipt period. Section 38B(4) provides that if s 38B(3) results in a person being taken to have been in a continuous receipt period for 12 months, then in determining a continuous receipt period after the 12 months, any period of not longer than 13 weeks of non-receipt is taken to have been a continuous receipt period. Section 38B of the Act refers to "income support payments", which, by s 23 of the Act, is defined to mean, among other things, a "social security benefit", which, by s 23 means, among other things, Newstart allowance. 13 Those provisions led the Tribunal to conclude that since Mrs Vranic was not in receipt of a social security benefit for approximately six months prior to 21 April 2008, she was not, in fact, in receipt of a social security benefit for a continuous period of nine months and nor was she taken, as a matter of law, to be in receipt of a benefit for a continuous period of nine months by operation of s 38B of the Act. 14 Thus, for the purposes of clause 5 of table B it could not be said that Mrs Vranic "has been receiving" Newstart allowance "for a continuous period of at least 9 months". The continuous period had been broken for a period of 185 days. There was, in the Tribunal's view, no continuity in fact and no constructive continuity by operation of law. 15 Mrs Vranic has now filed this application by way of an appeal from the Tribunal's decision. In doing so, Mrs Vranic is required to identify the question or questions of law she seeks to have determined by this Court. Mrs Vranic is self represented. She filed her application on 27 March 2009. It was formulated by her and is completed in her own handwriting. In many respects, the document is difficult to understand. However, the contentions are these. The error of law is said to be simply that the Tribunal reached a wrong decision. The question of law identified is said to be that there was a change in the name or title of the respondent Department after the completion of the application before the SSAT. As to the grounds upon which the application is based, Mrs Vranic says that the Tribunal took into consideration legislation which is unfair to her having regard to her financial circumstances. By ground 2, Mrs Vranic repeats the contention that the Tribunal allowed the respondent to change the name or title of the Department after the conclusion of the proceeding before the SSAT. Under that part of form 55A by which the applicant is asked to identify findings of fact the Court might be asked to make, Mrs Vranic identifies a number of other matters. She says that the Tribunal incorrectly interpreted her original case. Mrs Vranic says that she was denied fair procedures. She says the Tribunal "follow[ed the decision of the] Authorised Review Officer" and took the same "view and position as the Social Security Appeal". She also says that the Tribunal did not take any new evidence in the course of its review and the Tribunal was biased against her. 16 As to the error of law, it is insufficient to simply say that the Tribunal reached a wrong decision. No doubt, from a lay person's perspective, the perception of error is a failure to reach a perceived correct decision. Nevertheless, the error must be identified. As to the question of law, it is insufficient to simply say that a question of law arises as to whether it was open to the respondent to change the title of the Department of State after the conclusion of the SSAT hearing. The title of the Department has simply changed as a consequence of the new administrative arrangements put in place by the Commonwealth after the recent federal election. Similarly, it is insufficient to say that the Tribunal took into account the applicable legislation governing the maximum rate of benefit to be paid to a recipient which had the effect of unfairness having regard to the applicant's financial situation. Similarly, it is insufficient to say that the Tribunal reached the same decision as that reached by the Authorised Review Officer and ultimately, the SSAT. Similarly, a bald allegation of bias unsupported by any content cannot give rise to a question of law to be determined as to bias. Mrs Vranic has failed to identify a failure on the part of the Tribunal to apply fair procedures. 17 The Court put to Mrs Vranic and she accepted that the central matter of complaint is this. She contends that the Tribunal incorrectly applied clauses 4B and 5 of Table B of s 1068-B1 because the Tribunal incorrectly concluded that Mrs Vranic was a person who had not been receiving a social security benefit for a continuous period of at least nine months. Mrs Vranic says that, as a matter of construction, she had received for many years Newstart allowance and thus was a person who as a question of fact had received a social security benefit (Newstart allowance) for a continuous period of at least nine months at the time of commencement of benefits on 21 April 2008 and as a matter of law, the continuous period of receipt of benefits throughout the period 1 January 1998 to 17 October 2007 satisfied clause 5 of Table B and thus she was entitled to the higher rate of Newstart allowance prescribed by clause 5. 18 It seems to me that the only question of law raised by Mrs Vranic's application is a question of construction of clauses 4B and 5 of Table B of s 1068-B1. In that respect, the application raises a question of construction and therefore a question of law to be determined for the purposes of s 44(1) of the Administrative Appeals Tribunal Act.. No other question is properly raised by Mrs Vranic's application and she accepts that her complaint is that the Tribunal incorrectly approached the application of the notion of "continuous period" to her particular circumstances. Although Mrs Vranic has failed to formulate a question of law in the precise terms required by the well-known authorities on that question, I am satisfied that within her application document Mrs Vranic has identified a question of construction of the relevant sections of the Act and she accepts that the contention she relies upon is that the construction and application of the provisions of Table B to her circumstances by the Tribunal led to error in the determination of the applicable maximum rate of benefit to which she says she was entitled in the period from 21 April 2008 to 22 January 2009. 19 The further question however is whether the application ought to be dismissed on the footing that the application has no reasonable prospect of success. 20 The question of law to be determined is one of construction of the provisions of the Act as they apply to uncontested questions of fact. There are no authorities that bear on the construction question concerning clauses 4B and 5 of Table B of s 1068-B1 of the Act. The respondent says that Mrs Vranic has no reasonable prospect of succeeding in her contention (and thus the proceeding) that she is entitled to be regarded as a person who "has been receiving" a social security benefit for a "continuous period of at least 9 months" when the uncontested facts are that she ceased to receive a social security benefit on 17 October 2007, left Australia on 18 October 2007, returned 185 days later, made a fresh application for Newstart allowance and commenced receiving the allowance on 21 April 2008. 21 Section 31A of the Federal Court of Australia Act 1976 (Cth) introduced what might be described as a slightly more exclusionary rule of access to contested trial proceedings than previously obtained under General Steel Industries Inc v Commissioner of Railways (NSW) (1964) 112 CLR 125 and the earlier authority of Dey v Victorian Railways Commissioners (1949) 78 CLR 62 in respect of claims made or defences propounded in such a proceeding where the Court is satisfied that the relevant party has no reasonable prospect of successfully maintaining a particular claim or defence whether as to a part only or the entirety of the proceeding. 22 In orthodox terms, controversies between parties are resolved or quelled at a trial of the issues by first determining contested questions of fact by findings of fact made after hearing all the evidence and subjecting witnesses of fact or experts to adversarial cross-examination and, secondly, determining questions of law and applying the law so determined to the facts as found. Claims made or defences propounded in a proceeding before the Court that are frivolous, vexatious or an abuse of the process of the Court are addressed by O 20 r 5 of the Federal Court Rules. Similarly, a pleading that discloses no reasonable cause of action (or defence), has a tendency to cause prejudice, embarrassment or delay or is otherwise an abuse of the Court's process, may at any stage of the proceeding be struck out under O 11 r 16 of the Federal Court Rules. These rules, within the limits of their subject matter may well have the effect of foreclosing in the relevant proceeding, a contested hearing of such claims or defences subject to, as to O 11 r 16, the formulation of a new pleading with leave to amend that cures the particular vice evident in the pleading. Subject to the proper application of such rules, compliance with directions orders for the proper management of the proceeding consistent with the interests of justice, security for costs orders, stay orders and such related orders, a party otherwise ought not to be deprived of the right to a trial of the issues of fact and law and judicial resolution of the question or questions raised by the particular controversy. These principles are central to the consistent and predictable application of the rule of law. 23 Similarly, the discretion arising in any application under rules of Court which contemplate the dismissal of a proceeding, is to be exercised according to settled principle conditioned by the particular facts of the proceeding. 24 The respondent says that Mrs Vranic's contention as to the question of construction is so lacking in merit or substance as to be not fairly arguable and the phrase "no reasonable prospect of successfully" prosecuting or defending the proceeding (or that part of the proceeding) should be accorded the same construction as that described by Lord Woolf in Swain v Hillman [2001] All ER 91 in respect of the phrase "no real prospect of successfully", as directing the Court to "the need to see whether there is a 'realistic' as opposed to a 'fanciful' prospect of success". For the purposes of s 31A, a proceeding need not be hopeless or bound to fail for it to have no reasonable prospect of success (s 31A(3)). 25 In this application, there are no contested questions of fact which might be resolved one way or the other so as to enable one side or the other to succeed in the sense contemplated in Hocking v Bell (1947) 75 CLR 125, which influenced the approach to s 31A by Rares J in Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352. Finkelstein J in Jefferson Ford v Ford Motor Co of Australia Ltd (2008) 246 ALR 465 took the view that the test of reasonable prospect of success was a less stringent test than that proposed by Rares J in Boston Commercial. Plainly, the Court must be cautious not to do Mrs Vranic an injustice by summarily dismissing or foreclosing the proceeding. However, the question is whether as a matter of substance rather than form (White Industries Aust Ltd v Commissioner of Taxation (2007) 160 FCR 298 per Lindgren J) Mrs Vranic's construction has no reasonable prospect of success. 26 In a case such as the present where the question to be decided is a question of law, the Court must determine whether the argument advanced by Mrs Vranic is "sufficiently strong to warrant the matter going to trial" (Bradken Resources Pty Ltd v Lynx Engineering Consultants Pty Ltd [2008] FCA 1257 per Emmett J at [28]; Spencer v Commonwealth of Australia [2008] FCA 1256 per Emmett J; and McAleer v The University of Western Australia (No 3) [2008] FCA 1490 per Siopis J). 27 Is Mrs Vranic's contention sufficiently strong to warrant the matter going to trial? In my view, it is not. Clause 4B of Table B is directed to a person who "has not been receiving" a social security benefit for a "continuous period of at least 9 months". There is thus a relationship between the continuous period of at least nine months and the state of not having been the recipient of a social security benefit throughout that period. The construction of the section is made clear by the tense of "to receive" used in clause 4B. The use of the present perfect continuous form "has not been receiving" in conjunction with the phrase "a continuous period of 9 months" makes clear that if Mrs Vranic has not been receiving a social security benefit or other entitlement under the Act identified in clause 4B of Table B for a continuous period of nine months, she is entitled to receive a maximum rate of allowance prescribed by clause 4B from time to time. Similarly, by clause 5 of Table B, once Mrs Vranic has been receiving for a continuous period of at least nine months a social security benefit (or other entitlement identified in clause 5) she is entitled to then receive the higher rate of benefit. The past period of benefit payments prior to the cessation of benefits on 18 October 2007 does not form part of a present continuous receipt of social security benefits for the purposes of s 1068-B1 in relation to Mrs Vranic's later application for Newstart allowance made after a break in continuity of 185 days. 28 It seems to be that Mrs Vranic's contention in relation to the question of law raised by her application has no reasonable prospect of success. 29 It follows that pursuant to s 31A(2) of the Federal Court of Australia Act 1976 (Cth) the respondent is entitled to judgment in the proceeding. 30 Mrs Vranic has requested the Court to make a reference, for the purposes of O 80 of the Federal Court Rules,in order to facilitate the provision of legal assistance to her in relation to the proceeding. If I had been satisfied that by her proceeding Mrs Vranic had raised a question of law with a sufficient prospect of success to warrant the matter proceeding to trial, I would have made arrangements for legal assistance to be obtained on behalf of Mrs Vranic. However, I would have confined that assistance to providing advice in relation to a confined question. The question would have been this: Having regard to the application of s 1068(1) and s 1068-B1 of the Social Security Act 1991 (Cth) and any other relevant provisions of that Act to the circumstances relating to Mrs Vranic's application for an entitlement to a social security benefit described as Newstart allowance (and in particular, circumstances such as her receipt of Newstart allowance prior to 18 October 2007 and her absence from Australia from 18 October 2007 until 19 April 2008 and non-receipt of any social security benefits from 18 October 2007 to 20 April 2008), what rate of benefit was Mrs Vranic entitled to receive upon the commencement of payment of Newstart allowance on 21 April 2008? 31 However, the interests of justice are not served by making such a reference as I am satisfied that Mrs Vranic's contention has no serious prospect of succeeding and thus her proceeding would be dismissed. The interests of justice are not served by requiring the matter to proceed to trial and requiring the respondent to prepare an appeal record, retain solicitors on the hearing and brief counsel on the trial, when the costs incurred in doing so represent, in a real sense, public money. The amount in issue is approximately $910.00 and Mrs Vranic has no reasonable prospect of success in the proceeding. There is no prospect of the respondent's costs of the hearing of an appeal being paid by the applicant having regard to unsatisfied orders for costs made against Mrs Vranic in other Federal Court proceedings. (See Vranic v Chief Executive Officer, Centrelink [2004] FCA 992 and Vranic v Chief Executive Officer, Centrelink [2004] FCA 1511). 32 Accordingly, I propose to give judgment in the proceeding in favour of the respondent by ordering that the proceeding be dismissed with costs. I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood.