Gray v Secretary, Department of Family & Community Services [2002] FCA 768

FEDERAL COURT OF AUSTRALIA

Gray v Secretary, Department of Family & Community Services [2002] FCA 768

Social Security Act 1991 (Cth)s 1184(1) Administrative Appeals Tribunal Act 1978 (Cth) s 43(1)

Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577 Puhlhofer v Hillingdon London Borough Council (1986) 1 AC 484 Hooke v The Repatriation Commission (1988) FCA 20 Apthorpe v Repatriation Commission (1987) 77 ALR 42 Blackwood Hodge (Australia) Pty Ltd v Collector of customs (NSW) (1980) 47 FLR 131 Secretary, Department of Social Services v Ellis (1997) 46 ALD 1 Beadle v Director-General of Social Security (1985) 60 ALR 225 GRAY v SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES S 59 OF 2002 O'LOUGHLIN J 17 JUNE 2002 ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY S 59 OF 2002

BETWEEN: BARBARA GRAY

APPLICANT

AND: SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

RESPONDENT

JUDGE: O'LOUGHLIN J

DATE OF ORDER: 17 JUNE 2002

WHERE MADE: ADELAIDE

THE COURT ORDERS THAT: 1. The Application be dismissed. 2. The Applicant pay the Respondent's costs, such costs to be taxed in default of agreement. 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 59 OF 2002

BETWEEN: BARBARA GRAY

APPLICANT

AND: SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

RESPONDENT

JUDGE: O'LOUGHLIN J

DATE: 17 JUNE 2002

PLACE: ADELAIDE

REASONS FOR JUDGMENT 1 The applicant, Ms Barbara Gray, has appealed against the decision of the Administrative Appeals Tribunal ("the Tribunal") which denied her the benefit of a Newstart Allowance. The history of this matter goes back as far as July 1989 when Ms Gray was injured in an industrial accident. From then until July 2000, she was in receipt of Workers Compensation payments. 2 In 1992, Ms Gray and her partner, Mr Pollitt, purchased a small rural property in the Barossa Valley with the ultimate intention of running it as a cattle stud. The acquisition was partly funded by way of a bank mortgage of $80,000 bearing interest at the annual rate of 8 per cent. 3 In July 2000, Ms Gray's compensation claim was finalised with a lump sum payment of $120,000. There was an element of future economic loss in that payment. Legal expenses and moneys owing to Centrelink accounted for a large part of the compensation payment and, acting on professional advice, Ms Gray used the balance of the money to discharge the bank mortgage and to buy a stud bull for $5,000. 4 The Tribunal found that Ms Gray's solicitors contacted Centrelink "regarding the extent of the consequential preclusion period and that Centrelink communicated the required information …". The Tribunal also noted that Ms Gray acknowledged that she was aware of the preclusion period. 5 The financial position of Ms Gray and her partner, Mr Pollitt, immediately following the receipt of the compensation payment and the discharge of their various liabilities was reasonably sound. They owned an unencumbered property on which there was erected a transportable home. They had a small herd of cattle plus a valuable bull and they had some sundry other assets including some motor vehicles and a tractor. At that stage, Mr Pollitt was working full time in the security industry. 6 Their difficulties started a few months later in January 2001 when circumstances caused Mr Pollitt to resign from his employment. He has been unemployed since apart from occasional odd jobs of short duration. Both Ms Gray and Mr Pollitt applied for a Newstart Allowance as a result of Mr Pollitt's changed circumstances. Mr Pollitt was ultimately successful but Ms Gray was not. The decision of the respondent, the Secretary of the Department of Family and Community Services ("the Secretary") was that there should be a Pension Allowance Preclusion Period of approximately two years – from 14 July 2000, the date upon which she received her lump sum compensation, until 22 August 2002. That was the decision that Ms Gray challenged in the Tribunal and which she now challenges in this Court. 7 Ms Gray has based her appeal on the contents of subs 1184(1) of the Social Security Act 1991 (Cth) ("the Act"). The subsection provides as follows: "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." (emphasis added) 8 The Tribunal identified three factors that, according to the submissions of Ms Gray, constituted "special circumstances": · the unexpected curtailment of her partner's income earning activities; · her state of health: (she suffers a residual lung impairment which warrants her living in an unpolluted country location); and · her strained financial position. 9 The power of the Secretary that is contained in subs 1184(1) is wholly discretionary. That is evident from the use of the word "may" and the phrase "if the Secretary thinks it is appropriate to do so". Those discretions are not, however, limited to the Secretary. On an application for a review of the Secretary's decision, the Tribunal enjoys the same discretionary powers: see subs 43(1) of the Administrative Appeals Tribunal Act 1978 (Cth) which provides: "For the purposes of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment of the person who made the decision …"