FEDERAL COURT OF AUSTRALIA Cocks v Centrelink [2000] FCA 1248 Matter No. S 76 of 2000 JAMES COCKS v CENTRELINK O'LOUGHLIN J ADELAIDE 5 SEPTEMBER 2000 IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY S 76 OF 2000 BETWEEN: JAMES COCKS APPLICANT AND: CENTRELINK RESPONDENT JUDGE: O'LOUGHLIN J DATE OF ORDER: 5 SEPTEMBER 2000 WHERE MADE: ADELAIDE THE COURT ORDERS THAT: 1. The application be allowed. 2. The matter be remitted to the Administrative Appeals Tribunal to determine the matter according to law. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIA DISTRICT REGISTRY S 76 OF 2000 BETWEEN: JAMES COCKS APPLICANT AND: CENTRELINK RESPONDENT JUDGE: O'LOUGHLIN J DATE: 5 SEPTEMBER 2000 PLACE: ADELAIDE EX TEMPORE REASONS FOR JUDGMENT 1 The applicant in these proceedings is Mr James Cocks. He is aged 70 years and has been in receipt of an aged pension since 1992. On 25 February 1997 he married for a second time. The marriage took place in the Philippines. His wife, Thelma, was and is a Filipino national. She is some 36 years younger than Mr Cocks. Mr and Mrs Cocks have a daughter, Christine, who had been earlier born on 4 July 1996. 2 The family circumstances pertaining to Mr and Mrs Cocks and Christine are most unfortunate. Thelma and Christine continue to live in the Philippines and Mr Cocks visits them, staying up to six months at any one time. He explains that to stay longer would incur substantial costs, which he cannot afford, in obtaining extensions to his visa. He therefore returns to Australia, where he resides, free of board, with his sister, at her farm at Cummins on the West Coast of South Australia. 3 The Department of Family and Community services upon being informed by Mr Cocks of his marriage to Thelma decided to treat him as a member of a couple. It reduced his entitlement from that applicable to a single person to an amount that represented the married rate. I have been given the figures, which indicate that this means in effect about $33 per week diminution to Mr Cocks. Mr Cocks challenged the stand that had been taken by the department and he took the matter to the Administrative Appeals Tribunal ("the Tribunal"). 4 The question that had to be answered by the Tribunal was whether Mr Cocks was entitled to the benefit of s 24 of Social Security Act 1991. Subsection (1) of that section provides as follows: "Where: (a) a person is legally married to another person; and (b) the person is not living separately and apart from the other person on a permanent or indefinite basis; and (c) the secretary is satisfied that the person should for a special reason in the particular case not be treated as a member of a couple the secretary may determine in writing that the person is not to be treated as a member of a couple for the purposes of this act." 5 Mr Cocks has submitted during the course of today's proceedings – and I do not understand it to be disputed – that his circumstances satisfy the first of the three requirements of the subsection; that is, he is a person who is legally married to another person and he is a person who is covered by paragraph (b); that is, he is not living separately and apart from his wife on a permanent or indefinite basis. The potential is therefore present which would enable the secretary to examine the circumstances of Mr and Mrs Cocks to see whether the requisite satisfaction existed whereby the secretary could proceed upon the premise that he should not treat Mr Cocks as a member of a couple. 6 Mr Cocks was partially successful before the Tribunal. In par 18 of its reasons the Tribunal concluded that whilst Mr Cocks resides in Australia he is to be treated as not being a member of a couple for the purposes of payment of his pension at the single rate, but the Tribunal went on to conclude that whilst Mr Cocks is overseas – and I take that to mean overseas, living with his wife in the Philippines – he is then to be treated as a member of a couple and payment of the pension is then to be at the married rate. 7 Mr Cocks, who was not legally represented before the Tribunal and who has appeared on his own behalf before this Court, now appeals to this Court. He seeks to be treated in such a way that he would receive a pension at the single rate, irrespective of his place of residence. The department for its part did not however challenge the Tribunal's decision. The Tribunal made some important findings of fact that must be catalogued. Paragraphs 9 to 12 of the Tribunal's reasons, and I quote: "The applicant gave sworn evidence, which I accept, that in the course of his previous business enterprise he had travelled regularly to the Philippines from about 1988 onwards. His relationship with his wife commenced in about 1992. The same year he suffered a neurological disease which rendered him paralysed. The wife was working in Manila as a cleaner in a Chinese grocery store. She returned to her home province before the birth of their daughter and, when they married – And it states in 1992 but it should be 1997 – "The applicant secured rented accommodation in a nearby town, where they continue to reside. He estimates that the expenses in the Philippines, including rent and food, are about $A750 per month. The married pension rate is about $A640 per month. Whilst he was in receipt of the single rate in Australia he was able to save about $50 per week and could provide some further assistance to his family. The applicant gave evidence that he finds himself in an impossible situation. He can stay only up to six months in the Philippines. Australia is his home. He and his wife married so that their children would have legitimacy and, although he want the child and his wife to come to Australia to give the child a chance in life, he has made inquiries but not lodged the necessary forms. He has sold all his assets, including a painting and his golf clubs, to pay the air fares to the Philippines and, in addition, borrowed at least $2,500 from his sister in payment of the air fares of between 800 to 1000 dollars return. He simply cannot afford the $3,500 to bring his family to Australia and to provide accommodation. His wife is willing to come to Australia but realises that financially this is not possible and is resigned to the continuation of the current arrangements. The applicant said in evidence that in 1992 he suffered a neurological condition that led to paralysis and, and although he had recovered from the paralysis, he has been unable to undertake paid employment. He suffers also from a heard condition and takes five to ten milligrams of Linoxin daily, Warfarin to thin his blood, Renitec tablets for blood pressure, and he suffers also from diabetes. This means that when he is in the Philippines his special dietary requirements are very expensive and difficult to obtain. If he requires his prescription drugs whilst in the Philippines these are also very expensive. He says that with payment of the pension at the single rate he could make ends meet but with $A30 less per week on the married rate he is in dire financial straits. The applicant submits that although he is the creator of his own situation he cannot extricate himself and that it was his honest belief that, as he was not marrying an Australian girl who would be entitled to benefits, the fact that his wife and child remained in the Philippines would mean that payment of pension would continue at the single rate and the family could survive. He argues also that while he is in the Philippines he is not getting any of the benefits available in Australia and he should be entitled to the single rate whilst overseas and in Australia. 8 As the Tribunal stated that it accepted Mr Cock's evidence I take all aspects of this recitation of his evidence to be findings of fact in his favour. One matter of concern is that the Tribunal did not address the financial circumstances of Mrs Cocks. There was no finding that she was and is impecunious. There was no finding that she was unable to obtain employment. There was no finding that she was unable to obtain employment. There was an inference, however, that she may be impecunious, without employment, for the Tribunal quoted from the decision of an authorised review officer, who wrote: "I have accepted that you and your wife and child have been placed in a poor situation due to the reduction in your rate of pension and that this is an unexpected consequence of your marriage in 1997. I have accepted that you are unable to enjoy the benefits of a pooling of resources. I have also accepted that your ill health is another factor to be included in the consideration of what constitutes a special reason." 9 I would not expect that such a statement would have been made if Mrs Cocks was in employment or in receipt of some form of welfare benefit. 10 I turn then to the submissions of the department. The department submitted that the Act provides a comprehensive scheme with reduced social security payments because of the pooling of resources of a married couple. It submitted that s 24 of the Act will only apply in situations where one member of the couple does not and cannot reasonably, and not as a matter of choice, expect to benefit from the pooling of resources that usually occurs in a marital relationship. 11 It is submitted that the absence of Mrs Cocks and the child overseas was a matter which was not beyond Mr Cocks' control but, according to the department, it was a lifestyle choice for which the public purse should not bear responsibility. That submission, in my opinion, cannot be accepted. It is contrary to the facts as found by the Tribunal, and I quote again the relevant passage: "He simply cannot afford the $3500 to bring his family to Australia and provide accommodation." 12 The marriage of a man and woman is taken to mean, in ordinary circumstances, that they will pool their resources, share their expenses, and thereby live more cheaply than if they were two single persons who were living separate and apart. In the case of income earners they would pool their respective incomes. In the case of pensioners they would pool their pensions. In the case of Mr and Mrs Cocks it would seem to be the case that she has nothing to pool and he, as a result, has nothing to gain from any supposed pooling. That predicament exists whether or not they are residing together or apart. 13 It is quite clear that she does not receive any Australian welfare benefit that she can contribute to the pool and, as I have said, it seems as if the department is satisfied that she has no income or other benefit to pool. Mrs Cocks, of course, is not entitled to receive any social welfare benefits from Australia for so long as she remains a Filipino national, living in the Philippines. As she, in her present circumstances as a non-Australian resident, is not entitled to the benefits in our social welfare system it seems to me to be illogical to recognise her status as the wife of an Australian citizen for the purpose of diminishing welfare benefits that would otherwise have been available to her husband but for his marriage, the more so when the department accepts the Tribunal's decision that there is to be no diminution while the couple are physically separated. 14 It is said on behalf of the department that the Australian taxpayer should not be forced to bear the costs of Mr and Mrs Cocks' personal choices. That submission, in my opinion, is not justified and there is an element of parsimony in it. If Mrs Cocks and the child were to migrate to Australia an immediate benefit of $112 per fortnight would be available for the child and, after the expiration of 104 weeks, Mrs Cocks would have the potential to be entitled to the married rate of benefit. 15 Far from disadvantaging the Australian taxpayer, Mr Cocks' proposition that he be paid at the single rate – an increase of only $30 or so per week – is a positive saving to the Australian taxpayer for so long as Mrs Cocks and the child remain in the Philippines. That very important factor, which I identify as a material consideration, was not taken into account by the Tribunal in its reasons. 16 It is not for this court to resolve this matter on the merits. That is the role of the Tribunal. This Court can only interfere when it is able to identify an error of law. However, it is my opinion that the Tribunal, in failing to examine Mr Cocks' personal circumstances when he is residing in the Philippines with his impecunious wife, who is not entitled to any social welfare benefits from the Australian community, erred in law. In coming to this conclusion I consider that I am merely following a line of cases that have earlier been decided by the Tribunal and this Court. The first of them, in chronological sequence, was that of Tsimpidaros, an unreported judgment which was delivered on 5 July 1995. 17 In that case Mr Tsimpidaros had in effect, for the purposes of earning an income or receiving social security benefits, been regarded by the Australian government as a non-person; he had either been not allowed to earn an income or, when he was allowed to earn an income, he had been unable to find work. He was not yet eligible for social security benefits. There had been no chance to enjoy the pooling of resources that usually occurred in a marital relationship because there had been no joint resources to pool. This is exactly the case as it applies to Mr and Mrs Cocks. In Tsimpidaros' case the Tribunal held that this was one of the unusual circumstances to which subs (1) of s 24 should apply. 18 The next case is that of Hawkins (1996) 44 ALD 651. In that case the applicant and his wife married in 1995, shortly after her arrival in Australia on a tourist visa. Mrs Hawkins did not then have permanent residence and was therefore forbidden to work in Australia and could not be paid the wife's pension. However, because Mr Hawkins was married, a delegate of the respondent reduced the rate of Mr Hawkins' disability support pension from the single rate to the married rate. Once again, following the decision in Tsimpidaros, the Tribunal intervened, holding that the extreme impecuniosity of Mrs Hawkins, coupled with her inability lawfully to earn any income, were special factors which took this case out of the ordinary run of cases. Again one can see a similarity between the facts of the Hawkins case and the facts relating to Mr and Mrs Cocks. 19 The third of the cases is that of Galewski (1998) 543 ALD 569. The applicant, Mr Galewski, was born in Poland and migrated to Australia. He commenced to received an age pension in 1993. Two years later he married a citizen of Tonga in that country. Mrs Galewski had no income nor any other financial resources. A delegate of the respondent notified Mr Galewski that, as a married person, he should be paid the age pension at the lower married rate. 20 That decision was affirmed by the Social Security Appeals Tribunal. Mr Galewski applied to the Administrative Appeals Tribunal for review of the earlier Tribunal's decision. Once again, following on Tsimpidaros and Hawkins, the Tribunal found that the circumstances of the present case constituted a special reason which justified not treating Mr Galewski as a member of a couple. Again one can see a similarity in the facts of that case with those applying to Mr and Mrs Cocks. 21 The final decision to which I refer is that of a judgment of French J in this court in the matter of Boscolo (1999) 90 FCR 531. There the facts were somewhat different in that Mr Boscolo was separated from his wife by virtue of his determination to fight for the custody of his son from a previous marriage. He had initially taken up residence with his second wife in Perth but left her in Perth whilst he went to Sydney to fight for the custody of his son David. French J was of the opinion that this enforced separation – which was one of his own choice but borne out of the necessity to get the custody of his child – was sufficient to constitute a special circumstance. 22 In my opinion, the Tribunal recognised that Mr Cocks would not benefit from a pooling of resources whilst he was in Australia and his wife was in the Philippines but it failed to recognise that Mr Cocks would likewise not benefit from a pooling of resources during such time as he was residing with his wife and child in the Philippines for she has nothing to contribute to the pool. Having correctly recognised that there existed a special reason in the particular case, the Tribunal failed to recognise that this speciality had the potential to exist just as much when Mr Cocks was living with his wife in the Philippines. 23 For this reason this application will be allowed and the matter will be remitted to the Tribunal to determine the matter according to law. That concludes my reasons. I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice O'Loughlin. Associate: Dated: 5 September 2000 The Applicant appeared in person Counsel for the Respondent: Ms S Maharaj Solicitor for the Respondent: Australian Government Solicitor Date of Hearing: 5 September 2000 Date of Judgment: 5 September 2000