CATCHWORDS Administrative Law \i- Compensation (Commonwealth Government Employees) Act - recovery of overpayment - review of decision determining rate of repayment. Administrative Decisions (Judicial Review) Act 1977 Compensation (Commonwealth Government Employees) Act 1971 Minister for Aboriginal Affairs & Anor. v. Peko Wallsend & Ors. (1986) 66 A.L.R. 299 No. G89 of 1986 WILLIAM GREGORY BAKER v. AUSTRALIAN TELECOMMUNICATION COMMISSION FORSTER, J. ADELAIDE 26 JUNE, 1987 meme count & . ADSTRAMA ¢ F APARICIP NY BEEQISTHY fo > ae ee gen 4g ahs. ae ee ee Saltese iene ae a " IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY ) No. G89 of 1986 ) GENERAL DIVISION ) BETWEEN: WILLIAM GREGORY BAKER Applicant - and - AUSTRALIAN TELECOMNMUNICATION COMMISSION - Respondent MINUTE OF ORDER JUDGE MAKING ORDER 3 FORSTER J. WHERE MADE ADELAIDE DATE OF ORDER 26 JUNE 1987 THE COURT ORDERS THAT: 1. The decision of the respondent made on 8 December 1986 to deduct $127-89 per week from the compensation payable to the applicant be quashed. 2. The order quashing the decision of 8 December 1986 operate from 8 December 1986. 3.(a) the respondent within 42 days of this day determine according to law the rate of deductions to be made from compensation payable to the applicant from 8 December 1986; (b) should the amount of the deductions in fact made between 8 December 1986 and today exceed the total to be deducted in Set ny wre errr AL _3 2. accordance with the decision to be made pursuant to sub-paragraph (a) in respect of that period, the respondent shall not make any deductions to be made after this day until the amount of any excess has been exhausted; (c) should the amount of deductions in fact made between 8 December 1986 and today be less than the total to be deducted in accordance with the decision to be made pursuant to sub-paragraph {a) in respect of that period, the respondent shall not increase the amount deducted from the compensation payable to the applicant beyond the amount determined pursuant to sub-paragraph (a). 4. The respondent be allowed 28 days after it makes its determination in accordance with the preceding order to make any adjustments which are necessary to the payment of compensation to the applicant. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. oe ee Y , re " 4 2 arn ate . IN THE FEDERAL COURT OF AUSTRALIA } SOUTH AUSTRALIA DISTRICT REGISTRY No. G89 of 1986 GENERAL DIVISION BETWEEN: WILLIAM GREGORY BAKER Applicant - and - AUSTRALIAN TELECOMMUNICATION COMMISSION Respondent REASONS FOR JUDGMENT CORAM: Forster, J.: In this matter the applicant, William Gregory Baker ("Baker") seeks the review pursuant to the Administrative " Decisions (Judicial Review) Act of three decisions made by the respondent, the Australian Telecommunication Commission or its delegate concerning the recovery of overpayments of compensation. The facts giving rise to the overpayment of compensation pursuant to the Compensation (Commonwealth Government Employees) Act 1971 ("the Act") are not in dispute. The applicant sustained personal injury arising out of his employment with the Commonwealth on 16 February 1981 - namely aggravation of polymorphous light eruption by exposure to fluorescent lighting. On 26 January 1986 a delegate of the Commissioner for Employees Compensation determined that the applicant was deemed to have been totally incapacitated for work since 21 December 1982 and 2. that the respondent was liable to pay compensation to him in accordance with s.45 of the Act from 21 December 1982. From 21 December 1982 the applicant was also in receipt of a superannuation pension, part of which was not attributable to contributions made by him. The amount of compensation payable to the applicant was calculated without regard to that part of the superannuation pension not arising from the applicant's contributions and also without taking into account the applicant's partial earning capacity. The failure of the Commissioner for Employees Compensation to take these two factors into account resulted in an overpayment of compensation. As at 8 December 1986 this overpayment was assessed at $9,035-32. The respondent sought to recover the overpayment. Following discussions between the parties two amounts of $20-00 were deducted in October 1985, but these deductions were terminated due to the absence of a complete agreement. Due to a misunderstanding of the application of the Act, a delegate of the respondent, Mr Ireland believed that he was not entitled to recover any overpayments made prior to 26 July 1984. Submissions were made as to the effect of what amounted, it was said, to a waiver and whether or not it could be revoked. Mr R.G. Griffiths ("Griffiths") a senior delegate of the respondent gave evidence that the waiver was first put to Baker in a letter from Ireland dated 4 October 1985 in the form of a proposal that recovery "will only take place over a twelve month period prior to 25.7.85." I take this to mean that it is proposed that we rad Torin 3. recovery will only take place with respect to overpayments which took place during this twelve month period. Griffiths said that this proposal was "decided against" by him in October 1986 following the receipt of legal opinion. The applicant was given leave on the final day of the hearing to include this decision to recover overpayments made outside this twelve month period in the application for review. The applicant submitted that the decision to revoke the proposed waiver was improperly made as the receipt of legal opinion correcting the misapprehension was an irrelevant consideration. I have no trouble in rejecting this submission. It is obvious that a correct interpretation of the relevant statutory provision is necessary to the proper exercise of a delegate's power. A failure to consider the correct legal position would be an abuse of the administrative process. Therefore the application to review the first decision is refused. On 4 November 1986 a decision was made to deduct $106-89 per week from the compensation payable to Baker. Following the receipt of further information in regard to Baker's partial earning capacity, on 8 December 1986 a further decision was made to deduct $127-89 per week which was the entire weekly amount of compensation payable to the applicant. The decision of 4 November 1986 was overtaken by the decision of 8 December 1986 and I see no point in examining the earlier decision to see if it should be reviewed. ee or vot ws e \ a ~ er ae eee eet ey ee poe nee 4, The decision as to the amount to be deducted in recovery of the overpayment was the main issue of dispute. This Court is not concerned with an assessment of the merits of the decision but rather whether the applicant has established a ground for the granting of a review in s.5 of the Administrative Decisions (Judicial Review) Act. Griffiths was the delegate responsible for deciding the amount of the deductions from compensation. During his evidence it became apparent that he had not made an objective assessment of Baker's ability to repay the overpayments of compensation. Griffiths admitted that if Baker had been, in his view, an honest mana lesser deduction would have been adopted and that, apart from the fact that there was money owed, Baker's perceived dishonesty was the most important factor in making his decision. The likelihood of hardship to Baker caused by the level of repayments to be deducted from compensation was not taken into account. On the last day of the hearing it was conceded by the respondent that the decision of 8 December 1986 should be reviewed on the footing that the decision-maker had not taken into account Baker's capacity to pay when fixing the amount of the deduction to be made. In my view this concession was rightly made. While Griffiths is to be commended for the frank nature of his testimony he must be criticised for the method by which he exercised his power to make the relevant decision. The reasons stated by Griffiths in evidence show an improper exercise of the power delegated to him under the Act. The decision of the respondent made on 8 December 1986 aoe ene 5. must be quashed and remitted to the delegate so that a fair and reasonable assessment of the rate of repayment can be made in good faith and taking into account relevant considerations in particular Baker's capacity to pay bearing in mind his reasonable commitments. The applicant submitted that I should determine the amount of repayment or direct the respondent as to a_ possible range of amounts of repayment. This mistakes the role of this Court. Section 16(1)(b) of the Administrative Decisions (Judicial Review) Act does not empower the Court to substitute its decision for that of the decision-maker —- "The limited role of a court reviewing the exercise of an administrative discretion must constantly be borne in mind. It is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator. Its role is to set limits on the exercise of that discretion, and a decision made within those boundaries cannot' be impugned (Wesnesbur Corporation at 228)." (Minister for Aborigina Rffairs and Another v. Peko Wallsend an Others Ti986) 66 A.L.R. 299 at 309 per Mason J.) This principle does not prevent me from making orders with respect to the operation of the order to quash and the operation of the fresh determination. It is appropriate that the order quashing the decision of 8 December 1986 operates as from 8 December 1986. Any deductions made after 8 December 1986 must be taken into account together with the rate of deduction as lawfully assessed. This may result in a surplus or shortfall of assessed deductions. No further deduction should be made until i- een ce cot ee eee "sf oor - wn a : wesacg 6. the surplus, if any, is exhausted but in the event of a shortfall no greater deduction should be levied. The respondent should determine the rate of deduction within forty-two days of this date and should make any adjustments to the rate of payment of compensation which are necessary within a further twenty-eight days. The applicant submitted one further matter and this is that s.119 of the Act only gives the Commonwealth power to recover amounts of overpayment where a debt arises from a judgment in proceedings to recover the overpayment. "119. (1) Where - (a) an amount of compensation under this Act has been paid to a person in consequence of a false or misleading statement or representation or in consequence of a failure or omission to comply with a provision of this Act: {b) an amount of compensation that has been paid to a person under this Act should not have been paid; or (c) a person is liable to pay an amount' to the Commonwealth under this Act, the amount concerned is recoverable by the Commonwealth from the person as a debt due to the Commonwealth by action in a court of competent jurisdiction. (2) Where an amount is recoverable by the Commonwealth from a person in pursuance of the last preceding sub-section and an amount is payable under this Act to or for the benefit of that person, the first-mentioned amount may be deducted from the second-mentioned amount." ver weap eee ' rf yw 7. The interpretation submitted by the applicant misconstrues the section. The effect of s.119(1) is to empower the Commonwealth to take legal action to recover any overpayment if it is necessary to do so. The effect of s.i19(2) is that where an amount is capable of recovery under sub-s.{1) it can be recovered by making deductions from compensation payable to a person under the Act. There is no requirement that a judgment debt must exist before deductions can be made. Por these reasons the application to review the decision of 8 December 1986 must succeed, the decision be quashed and the matter recommitted to the respondent or its delegate to reconsider the appropriate rate of deduction. I will hear counsel on the question of costs. I certify that this and the preceding pages are a true copy of the Reasons for Judgment of Mr Justice Forster. associate Yl obal MKnwrelor, Counsel for the applicant Pry Mr D. Willson Solicitors for the applicant Lee and Partners Counsel for the respondent Mr J.J. O'Halloran Solicitors for the respondent Australian Government Solicitor Date (s) of hearing 27 March, 27 May & 10 June, FEDERAL COURT OF AUSTRALIA AvELMOE ee BaueR v Avs RLIAN WeLE COMMUNICATION Gonmission et kt No. of Action Gerd District Registry Division TEE ao ee ere oo cg wee cre ye ta c TITLE OF ACTION . SP MTE. . POSTERTUIN (SLE COUNTS a7 AAROA e Date(s) of hearing ..72..%¢...5°%7 pate judgment 6-@7 lo Due delivered £62478. . We *) . Di Wson eee eee ereereresreeeesresreneeses Counsel and on Corners solicitors for IN RrAr FT. S. O' YPotheren ee | Counsel and solicitors for Ce ae | eoeeerececrs Lata Signe Date , (Associate) FEDERAL COURT OF AUSTRALIA .- AMSHIE 2... District Registry eee Goeth. -.- Division No. of Action GI A Se TITLE OF ACTION .SAMTS, ~, AUSTRALIAN Tete COMMUNICATIONS (ommisscons a7 ARES : g : Date(s) of hearing ..72..0%1....09%7 pate juagment -e7 1o Dune delivered £a7 & . & oe We DY. Witson Counsel and ee ee ey ow Qotenars ee Tee ae ce sere enero er sensenee solicitors for A weer recee Ac oT. S. OO Yodlorey Counsel and solicitors for Dwatrodion Grevernek Golrei' Signed/ 2... cece le ceeee * (Associate) Date 467 b7F) slew ceeee FEDERAL COURT OF AUSTRALIA . AMIE... District Registry ». SEPSzRL LL pavision No. of Action Gels VS TITLE OF ACTION . SAMS, ~ . Avsrerrias ete ComMuM CATION: Commission a7 AARON g : Date(s) of hearing . tt. 8 Date judgment b- 1o | SuNE delivered £67 6787, We YD. Lt son Counsel and «pee, ond Rowtmars solicitors for IN ee eres econ ieee ieee Counsel and solicitors for Plamen iat e . . . . . ° . . ° . . . . . . . . . . . . . ° . . . (Associate) Date 46-7 b-F) cl cecoes Signe eon Ne tne tren tee em mee eee "wee presto ve ow Renee ae og pe ee wth yore af FEDERAL COURT OF AUSTRALIA . AVE... "District Registry 6 GEER, Division No. of Action &%2, 2, 286 TITLE OF ACTION .SAMTS, | AUSHR ALIAS Tete COMMUNICATIONS Commissions 27 AARON g Date(s) of hearing ..277.4%¢...§3%* pate judgment 7) _ 6 lo June delivered £67 67 ¢7 We DV. Wilson Counsel and solicitors for IN ann Qotimnars Paani ae rr FT TS. O' Vodllere ny eee eee reese er ere messesesese Counsel and solicitors for Pte ian iain re chael ewer eeseedecoses (Associate) Date £67 ion Signe weg meee vow FEDERAL COURT OF AUSTRALIA . ABANVE 2... District Registry eee G TTS LL. Division No. of Action GBI 4A Sb TITLE OF ACTION .SAMTEv , Ausre aia Tete COMMUNICATIONS Conmissions 27 TARE qet Date(s) of hearing ..4?..%%1....7" pate judgment 10 Sune deliverea 207.787. We DV, Willson Counsel and solicitors for IN ee ere ere ese rresrereesecsesneeces ond Corknars ree ee ee ee ee ee Fie ae aie Ar T.T. O' Yotborey ee ee wre meses e ema eeseressereses Counsel and solicitors for eee ee rere ewes secre rseseseecs beraveotion Geumwrk Gloiles er ee ee (Associate) Date £67 ETFIL. sees ey "sR On Signe uw or FEDERAL COURT OF AUSTRALIA .. ARHIE ..... "District Registry aes Gs SET RRL LL.) Division No. of Action GBI A Sb TITLE OF ACTION .SAMTS, ~~, Avsrgatias Were COMMUNICATIONS Commissions 27 wk . ¢ Date(s) of hearing ..72..%%¢....52%? pate judgment -e7 \O JUNE delivered Ze- & . & oe Counsel and solicitors for & Pian eam ham tan . . . . . . . . . e e . . . . . . e . . . ° . . . . . . Counsel and solicitors for Po tate aaa ° ° . . . . . e * . . . e « e e . . e . ° . . . ry . . Signe Maal on . (Associate) pate 67 4-FI....... Sop cm tat gp peer iowa eee vote wee me eet toe boa . neal Le et repent: FEDERAL COURT OF AUSTRALIA . ASEUWIE 6... "District Registry 1 GEIL Division No. of Action GBI A STS TITLE OF ACTION .SRHTE, v , Avsytktias ete COMMUNICATIONS Connissions 27 ARRON Date(s) of hearing WAT RECLLRS pate judgment 5, 6-@7 lO Zune delivered ae Counsel and ey onh Qorlnars eoteer esters ee rere reese ereeee solicitors for Bx rar FT... O' Vadtleoray Counsel and solicitors for tanita kamen s Signe (Associate) Date 4b- ECPM. Wee enn ep ee ee ee -—— Te ic , TR ee = ba anetinsateiesheateninad tetas =n seteteenta ch aerate aa -7