Shahid and Secretary, Department of Social Security [1996] AATA 859 (17 October 1996)

Last Updated: 22 December 2008

Administrative
Appeals
Tribunal

DECISION AND REASONS FOR DECISION

ADMINISTRATIVE APPEALS TRIBUNAL )
) No N96/15
GENERAL ADMINISTRATIVE DIVISION )

Re BERNADETTE SHAHID
Applicant

And SECRETARY, DEPARTMENT OF SOCIAL SECURITY
Respondent

AAT Decision No 11311

DECISION

Tribunal Ms G Ettinger, Senior Member

Date 17 October 1996

Place Sydney

Decision The decision of the Social Security Appeals Tribunal dated 7 December 1995 is affirmed.

..............................................
Ms G Ettinger
Senior Member

CATCHWORDS

SOCIAL SECURITY - pension, benefits, and allowances - compensation affected payments - whether special circumstances - financial circumstances - health - reviewable decision affirmed

Social Security Act 1991 ss 1168 1170 1184

Zaccardi and Secretary, Department of Social Security (18 December 1995, AAT 10606)

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

Beadle v Director-General of Social Security [1984] AATA 176; (1985) 60 ALR 225

Director-General of Social Security v Hales [1983] FCA 81; (1983) 47 ALR 281

Re Ivovic and Director-General of Social Services [1981] AATA 57; (1981) 3 ALN N95

REASONS FOR DECISION

17 October 1996 Ms G Ettinger, Senior Member

1. The decision for review before the Administrative Appeals Tribunal (“the Tribunal”) was a decision of the Social Security Appeals Tribunal (“the SSAT”) of 7 December 1995 (T2) which affirmed a decision of the Authorised Review Officer of 27 October 1995 (T15), which affirmed a decision dated 26 September 1995 of the Delegate of the Secretary, Department of Social Security (“DSS”) (T8) to recover, as a result of a compensation payment, benefits totalling $12,120 paid during the period 12 October 1993 to 19 September 1995.
2. The Applicant, Mrs Bernadette Shahid, was self-represented, and the Respondent, was represented by Advocate, Mr Ken Borger.
3. The Tribunal accepted into evidence the documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 and the following evidence:

Letter to the Applicant from L Wheeler

18 October 1993

Exhibit R1

ISSUE BEFORE THE TRIBUNAL

4. The issue for consideration of the Tribunal was whether the SSAT correctly affirmed the DSS finding that no “special circumstances” existed pursuant to section 1184 of the Social Security Act 1991 (“the Act”), with regard to the recovery pursuant to section 1170 of the Act, of worker’s compensation payments made to Mrs Shahid.

THE LEGISLATION

5. The legislation relevant to Mrs Shahid’s case is sections 23, 1168, 1170 of the Act as at October 1993. It is noted however that there have been no amendments to these sections which would in any way alter the situation as regards Mrs Shahid’s rights.
6. The consideration of section 1184 of the Act and whether “special circumstances” in the terms of the legislation apply to the Applicant, is assessed in terms of her circumstances at the date of hearing. The relevant parts of the legislation are as follows:

“23 (1) In this Act, unless the contrary intention appears:
‘social security benefit’ means:
(a) newstart allowance; or
(b) job search allowance; or
(c) sickness allowance; or
(d) . . .”

“1168 (1) Subject to subsections (4), (5), (6) and (7), if:
(a) a person, or the person’s partner , receives a series of periodic compensation payments; and
(b) the person is qualified for:
(i) . . .
(ii) . . .
(iii) social security benefit; or
(iv) . . .(v)
for the periodic payments period;and
(c) the person was not, at the time of the event that gave rise to the entitlement of the person, or the person’s partner, to the compensation, qualified for a pension, benefit, or allowance referred to in paragraph (b);
the rate of the person’s pension, benefit or allowance is to be reduced, under subsection (3), for the periodic payments period.”

In effect, section 1168(1) means that when a person, or their partner, receives compensation payments for a certain time, and also receive a social security benefit, DSS is entitled to reduce their payments.

“1170 (1) If:
(a) a person receives a series of periodic compensation payments; and
(b) the person receives payments of:
(i) . . .
(ii) . . .
(iii) social security benefit; or
(iv) . . .(v)
for the periodic payments period; and
(c) the person was not, at the time of the event that gave rise to the entitlement of the person to the compensation, receiving a pension, benefit or allowance referred to in paragraph (b); and
(d) those pension, benefit or allowance payments have not been reduced under section 1168;
the Secretary may, by written notice to the person, determine that the person is liable to pay to the Commonwealth the amount specified in the notice.”

The effect of section 1170(1) is that when a person, or their partner, receives compensation payments for a certain time, and also receive a social security benefit over that time, DSS is entitled to hold the person liable for a certain amount of money and must notify them in writing of it.

“1170 (3) If the person’s situation is covered by item 1 or 2 in the Table, the recoverable amount is equal to the smaller of:
(a) the sum of the periodic compensation payments; or
(b) the sum of the pension, benefit or allowance payments to the person for the periodic payments period.”

This section means that the amount of money the person can be held liable for under section 1170(1) of the Act is the smaller of either the total compensation payments they received or the total social security benefits they received. In the case of Mrs Shahid this was the $12,120 which she received as a compensation payment. Her social security payment for the same period, 12 October 1993 to 19 September 1995 was $17,359.75.

“1184 (1) For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:
(a) not having been made; or
(b) not liable to be made;
if the Secretary thinks it is appropriate to do so in the special circumstances of the case.
(2) ...”

The effect of section 1184(1) is that if DSS believes there are “special circumstances”, it can disregard the fact that a person was receiving both social security and compensation payments at the same time.

EVIDENCE BEFORE THE TRIBUNAL

6. The Applicant, Mrs Bernadette Shahid, was born on 1 May 1966 and arrived in Australia in 1988. She told the Tribunal that she had worked as a clerk for the Police Department prior to an injury for which she made a compensation claim.
7. The Applicant told the Tribunal that she had found some inaccuracies in the Respondent’s documents, in particular correspondence she had received suggesting that she was experiencing pain in her lower back, whereas her pain, she said, was in both her hands, her neck, and her jaw. Ms Shahid also said she experienced headaches, and since ceasing work had experienced depression that required medication.
8. Evidence before the Tribunal was that Mrs Shahid had made a successful claim for compensation, the date of injury for which was given as 17 August 1993 (T6). An award of compensation for $120 per week was made on the 5 September 1995 (T6), including arrears from 6 September 1993 and ongoing payments. It was undisputed that the amount of compensation to which Mrs Shahid was entitled from the time she started receiving social security benefits to the time DSS received notice of her compensation award, was $12,120. It was also undisputed that over the same period, Mrs Shahid had received from DSS $17,359.75 in compensation affected payments.
9. Pursuant to section 1170(3) of the Act, DSS recovered the smaller of the two amounts, being the periodic compensation payments received from the time of first receipt of social security benefits to the time DSS received notice of her compensation award. Thus, DSS recovered $12,120 for the period 12 October 1993 to 19 September 1995 (T8).

SUBMISSIONS AND CONCLUSIONS

10. I have considered all the evidence placed before me and must now take into account the submissions of Mrs Shahid and the Respondent, as well as the relevant case law and legislation.
11. I am mindful that Mrs Shahid said she felt humiliated by the way DSS had treated her when she sought assistance for both herself and her husband. She said she did not wish to break the law and was only seeking justice. She was particularly concerned about the Respondent’s failure to back-date for two months, social security payments to which she believed her husband had become entitled upon his marriage to her. In response to Mrs Shahid, Mr Borger apologised on behalf of the Respondent for any poor treatment by DSS and made a personal undertaking to have the matter of her husband’s entitlements remitted to the relevant units within the DSS for re-examination and to personally follow-up the matter.

SECTION 1170

12. Taking into consideration all matters raised at the hearing the Tribunal finds itself in agreement with the conclusions of the SSAT regarding application of section 1170 of the Act. According to the evidence, Mrs Shahid had received periodic compensation payments back-dated to 6 September 1993 (T6) within the contemplation of sub-section 1170(1)(a) of the Act. She had also received payments of a social security benefit within the terms of sub-section 1170(1)(b) of the Act.
13. Compensation affected payments are defined in section 17 of the Act as including a social security benefit, which is defined in section 23 of the Act as including a newstart allowance, a job search allowance, and a sickness allowance.
14. The Tribunal accepts the evidence of the Respondent, uncontested by the Applicant, that Mrs Shahid commenced receiving sickness allowance on 12 October 1993, jobsearch allowance on 18 October 1993, and newstart allowance on 24 September 1994. There are no circumstances under sub-sections 1170(1)(c) and (d) of the Act that could negate Mrs Shahid’s liability. Accordingly, there was, in the Tribunal’s opinion, no obstacle to the delegate’s right to serve a notice on Mrs Shahid requiring payment of the specified amount (T8).
15. Mrs Shahid received social security benefits from 12 October 1993 to 19 September 1995. These amounted to $17,359.75 For the same time period, she received $12,120 as a result of her compensation award on 5 September 1995. Pursuant to section 1170(3) of the Act, the amount recoverable is the smaller of the two amounts, being $12,120. Section 1170(2) of the Act deals with the recoverable amount specified in the notice, which is calculated according to a table and sections 1170(3), (4).

SECTION 1184

16. More difficult is the question of whether the Tribunal can agree with the finding of the SSAT that there were no “special circumstances” under section 1184(1) of the Act sufficient to justify a waiver of Mrs Shahid’s debt to DSS.
17. In Beadle v Director-General of Social Security [1984] AATA 176; (1985) 7 ALD 670 at 674, the Full Court of the Federal Court, in examining “special circumstances” within the terms of section 102(1) of the Social Security Act 1947, said that :

“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

18. In Re Beadle and Director-General of Social Security (1984) 6 ALD 1 at 4, the Administrative Appeals Tribunal said:

“The question is whether, when the relevant circumstances of the applicant are looked at in their entirety, they may fairly be described as unusual, uncommon or exceptional so as to warrant payment of the allowance earlier than the date from which it would ordinarily be paid.”(emphasis added)

19. This passage was affirmed by the full court of the Federal Court in Beadle v Director-General of Social Security (supra). The Court, at 230, said:

“While we would place less emphasis on one dictionary definition of ‘special’, we are in broad agreement with the approach of the Tribunal and are in agreement with its conclusion.”

20. In Re Ivovic and Director-General of Social Services [1981] AATA 57; (1981) 3 ALN N95 the Tribunal, at N97, said:

“The reference to special circumstances ‘by reason of which’ a person liable ‘should be released’ requires, in our view, that there must exist in the circumstances of the case, a factor or factors which justify the making of an exception in whole or in part to the principle of liability which the Act otherwise establishes . . .Thus whilst keeping the dominant principle of s 115 in mind, he must nevertheless be prepared to respond to the special circumstances of any particular case by reason of which strict enforcement of the liability created by the section would be unjust, unreasonable or otherwise inappropriate.”

THE APPLICANT’S FINANCIAL CIRCUMSTANCES

21. In its consideration of "special circumstances”, the Tribunal notes Mrs Shahid’s financial circumstances. She gave her income as $120 a week in compensation, and $80 a week in social security payments. She told us that her brother, who lives with her and is currently working, is paying approximately $50 to $60 board a week, but she told the hearing that this occurs irregularly and depends on his own financial circumstances.
22. She told the hearing that her husband is studying for a Master’s degree in Engineering at the University of Technology, Sydney. He is unemployed, and has a student loan, the balance of which is approximately $14,000. He is claiming a Job Search Allowance. Mrs Shahid and her husband attend marriage counselling once a week which costs them approximately $10 per attendance. The family pays $220 a week for a two bedroom flat, of which Mrs Shahid contributes approximately $100 a week.
23. Mrs Shahid went to pains to point out that the car owned by herself and her husband, and viewed by the Social Security Appeals Tribunal as evidence that “...it does not seem that they are absolutely deprived of the necessities of life,” (T2) was largely paid for through a loan from her brother. She said it was a necessity due to her husband’s search for work, and, due to Mrs Shahid’s inability to carry things with her hands, for shopping and similar activities. Additionally, Mrs Shahid had been attacked in late 1984, had since suffered panic attacks as well as being anxious when walking alone. She said that the car was needed for this reason.
24. Mrs Shahid said that she needed the compensation payment in order to pay for a voice-operated computer that will enable her to pursue further studies, and in order to allow her husband to set up a handy-man business under the New Enterprise Employment Scheme.
    
25. In Director-General of Social Services v Hales [1983] FCA 81; (1983) 47 ALR 281 at 321, Sheppard J said:

“The legislation provides for the payment of a variety of benefits to different classes of people who will usually have one thing in common; they will be impecunious and in straitened circumstances.”

26. I acknowledge Mrs Shahid’s difficult financial circumstances and am conscious of her courage in dealing with such circumstances in what is, for her, a relatively new country. However I can see nothing in Mrs Shahid’s circumstances that is capable of coming within the description of unusual, uncommon, or exceptional. I agree with the findings in Beadle (supra) and Hales (supra) and the SSAT that financial hardship is a circumstance of almost every person who is obliged to rely on income support. Mrs Shahid’s evidence did not reveal any circumstance that distinguished her situation from that of other clients of the DSS. As to the financial aspects, I make the finding that her circumstances do not constitute “special circumstances” within the terms of section 1184(1) of the Act.

THE APPLICANT’S HEALTH

27. The Tribunal notes Mrs Shahid’s description of her health problems. Although little evidence was tendered on this point at the hearing, the Tribunal accepts that Mrs Shahid has pain in both hands and her neck and a clicking sensation and pain in her jaw. As a result of her injury and cessation of work, she says she has experienced significant depression requiring psychiatric help and medication, though she no longer suffers from such significant depression.
28. However, the Tribunal finds that Mrs Shahid’s health is also not a “special circumstance” within the terms of section 1184(1) of the Act. In Zaccardi and Secretary, Department of Social Security (AAT 10606 18 December 1995), which also considered section 1184(1) of the Act, the Tribunal accepted that the Applicant had a severe spinal injury requiring a spinal fusion, wore a back brace, suffered constant pain, and had developed psychiatric and psychological problems as a result of his injuries. The Tribunal there said:

“I find that the circumstances in this matter relating to Mr Zaccardi’s severe ill health and resulting lifestyle limitations are special. But the cases set out above show that for the discretion in s. 1184 of the Act to be exercised, those circumstances must be so special, unusual or uncommon that they make it appropriate to treat the whole or part of a compensation payment as not having been made or not likely to be made. . .The discretion under s. 1184 must be exercised consistently with the policy and purpose of the Social Security Act and in particular with Part 3.14 of the Act.”

29. Although Mrs Shahid continues to suffer as a result of her injury, she does not, in the opinion of the Tribunal, experience hardship beyond that experienced by many recipients of compensation payments. There is nothing unusual, uncommon, or exceptional in the circumstances of her health. Were the discretion in section 1184(1) of the Act to be exercised in Mrs Shahid’s favour, it would have to be exercised in favour of many, if not the majority, of compensation recipients, thus extending the meaning of the term “special circumstances” beyond the intention of the legislature.

INCORRECT ADVICE

30. As to advice; Mrs Shahid submitted that she had not been informed by the solicitor who represented her in her compensation claim that DSS may be entitled to recover an amount of her compensation award from her. She did say that her barrister had mentioned the possibility of compensation recovery on the way to court and said that she had no choice but to go along with it. I am mindful that the provision of incorrect advice may constitute a “special circumstance” but am not convinced that this occurred in Mrs Shahid’s case. If indeed it did, then it would still have to be the totality of the circumstances which together constitute “special circumstances” within the terms of the legislation, and I have not found that in Mrs Shahid’s case.
31. I am mindful that there are other indicia of “special circumstances” which may be considered, such as legislative amendments. There appear to be no others which have impacted on Mrs Shahid’s situation.

CONCLUSION

32. Although I sympathise with Mrs Shahid with regard to her difficult situation, I nevertheless cannot find that the evidence establishes “special circumstances” within the terms of the Act. Even when her health and finances and the advice she may have been given are considered together, I find that Mrs Shahid has failed to establish “special circumstances” within the terms of the Social Security Act 1991.
    
33. Accordingly, I find myself in agreement with the SSAT on both issues raised in this case. The decision of the SSAT dated 7 December 1995 is affirmed.

I certify that this and the 12 preceding pages are a true copy of the decision and reasons for decision herein of     

Ms G Ettinger, Senior Member

Signed: .....................................................................................

Associate

Date/s of Hearing 19 September 1996

Date of Decision 17 October 1996

Solicitor for Applicant Self-represented applicant

Representative for Respondent Mr K Borger

Department of Social Security