Federal Court of Australia

Lyall v Secretary, Department of Social Services [2024] FCA 1263

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MCDONALD J

Introduction

1    Between 2008 and 2014, the applicant, Amii Lyall, received parenting payments under the Social Security Act 1991 (Cth) (Act).

2    On 23 July 2014, Healthscope Pty Ltd (Healthscope) advised Centrelink that Ms Lyall had started working for Healthscope on 4 July 2011, and provided Centrelink with pay details relating to Ms Lyall for the period 27 June 2011 to 10 February 2014. The rate of the parenting payment applicable to Ms Lyall during that period was determined on the basis that she was not earning income. An officer within the Department of Social Services (Department) determined that there had been a change in Ms Lyall’s circumstances as a result of her receipt of income and, in December 2014, raised a debt on the basis that there had been an overpayment of the amount of the parenting payment received by Ms Lyall during the period of her employment by Healthscope.

3    Ms Lyall sought review of the decision to raise a debt and a review officer within the Department confirmed the decision. Ms Lyall then applied to the Administrative Appeals Tribunal (Tribunal) for review of the decision pursuant to s 142 of the Social Security (Administration) Act 1999 (Cth) (Administration Act) (as then in force). The Tribunal affirmed the decision of the review officer.

4    Ms Lyall lodged an application for a second review of the decision pursuant to s 179 of the Administration Act (as then in force). On 17 October 2023, the Tribunal on the second review affirmed the decision and gave written reasons for its decision. In the course its reasons, the Tribunal recorded that it found that Ms Lyall had failed to report the change in her circumstances and that it was unable to waive the debt in the exercise of the power in s 1237AAD of the Act because the debt had arisen from Ms Lyall “knowingly … failing … to comply with a provision of the Act”.

5    Ms Lyall has appealed to this Court pursuant to s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) (as in force when the appeal was commenced). Ms Lyall contends that the Tribunal’s decision was affected by errors of law in that the Tribunal failed to engage with a clearly articulated claim made by Ms Lyall that she suspected that she had reported her income during the period to which the debt related, and failed to provide adequate reasons for its decision.

6    For the reasons that follow, in my view, on a fair reading of the Tribunal’s reasons, the Tribunal did not fail to consider and deal with the substance of Ms Lyall’s claim, and its reasons for finding that Ms Lyall knowingly failed to comply with an information notice were adequate. Ms Lyall has not established that the Tribunal’s reasons are affected by any error of law and the appeal will be dismissed.

Grounds of appeal

7    Ms Lyall’s appeal to the Tribunal concerned two debts. The debt that is the subject of the appeal to this Court was identified in the reasons of the Tribunal as “Debt 1”. Ms Lyall relies on two grounds of appeal, with particulars, as follows:

(1)    The Tribunal committed an error of law by failing to consider, and deal with, a clearly articulated claim that Ms Lyall reported income in the relevant period with respect to “Debt 1”.

(a)    The Tribunal, at [112], recorded Ms Lyall’s claim that she suspected that she was reporting income “as otherwise the debt would have been raised earlier”.

(b)    The Tribunal, at [113], did not address this claim, but rather addressed a separate claim that Ms Lyall’s “responses were falsely recorded by officers of Centrelink on more than one occasion”.

(c)    From this premise, the Tribunal found that Ms Lyall “knowingly failed to comply with an information notice in relation to Debt 1”.

(d)    Ms Lyall’s claim that she suspected that she was reporting income was a separate, and discrete, submission that the Tribunal was required to engage with. The submission was not taken into account in any real sense. Nor was it subsumed into the finding that the “responses were falsely recorded”.

(e)    The Tribunal’s failure to engage in a clearly articulated claim was a sufficiently serious error of law because, if the submission was accepted, Ms Lyall could have contended that there were grounds to waive the debt.

(2)    The Tribunal committed an error of law at [113] by failing to provide reasons that Ms Lyall “knowingly” failed to comply with an information notice.

(a)    The Tribunal set out at [113] of its reasons the basic findings of fact from which the decision proceeded in relation to Ms Lyall’s knowledge of the obligation to report her income for Debt 1.

(b)    That finding related primarily to the claim that Centrelink officers falsely recorded her reporting.

(c)    Earlier, at [112], the Tribunal found that Ms Lyall did not read the notices issued under s 68 of the Administration Act.

(d)    In the circumstances, the Tribunal failed to provide adequate, or sufficient, reasons for attributing to Ms Lyall “knowledge” of the reporting requirements in circumstances where the evidence before the Tribunal was that Ms Lyall did not read the notices.

(e)    The failure to do so disabled a reviewing Court from understanding whether the reasons contained an error of law.

Relevant legislative provisions

8    The statutory provisions that provide for the qualifications for and payability of the parenting payment are found in Part 2.10 of the Act. Section 503(a) relevantly provides that the parenting payment rate for a person in the position of Ms Lyall is to be worked out using the Pension PP (Single) Rate Calculator at the end of s 1068A. The details of that calculation are not presently important. It is sufficient to note that an “income reduction” must be applied by reference to the person’s “ordinary income”. In short, if a person earns, receives or derives ordinary income, that may affect the rate of the parenting payment that is payable to a person.

9    Section 68(2) of the Administration Act empowers the Secretary to give a person to whom s 68 applies a notice requiring the person to do particular things including informing the Department if a specified event or change of circumstances occurs or if the person becomes aware that a specified event or change of circumstances is likely to occur: s 68(2). A person to whom a social security payment (which includes the parenting payment) is being made is a person to whom s 68 applies. By s 100(1) of the Administration Act, if a person does not inform the Department of the occurrence of a relevant event or change of circumstances within the relevant notification period in accordance with a notice issued under s 68(2), the social security payment becomes payable to the person at a reduced rate from the date on which the event or change of circumstances occurred.

10    Section 1223(1) of the Act provides that, subject to s 1223 itself, if a social security payment is made and the person who obtains the benefit of the payment was not entitled to obtain that benefit, the amount of the payment is a debt due to the Commonwealth by the person and the debt is taken to arise when the person obtains the benefit of the payment. Section 1223(1AB)(c) provides that a person who obtained the benefit of a social security payment is taken not to have been entitled to obtain the benefit if the payment should not have been made because the payment was not payable. The references to “social security payments” in s 1223 include references to part of a social security payment: s 1223(9). The effect is that a parenting payment that is overpaid is recoverable as a debt to the extent of the overpayment.

11    Section 1237AAD of the Act provides:

1237AAD Waiver in special circumstances

The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

(a)     the debt did not result wholly or partly from the debtor or another person knowingly:

(i)     making a false statement or a false representation; or

(ii)     failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and

(b)     there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

(c)     it is more appropriate to waive than to write off the debt or part of the debt.

Relevant parts of the Tribunal’s reasons

12    Ms Lyall began receiving the parenting payment in 2008. She was issued with notices under s 68(2) of the Administration Act and copies of those notices were in evidence before the Tribunal. They included a notice dated 11 May 2011, before the date on which Ms Lyall’s employment with Healthscope began. Each of the notices required Ms Lyall to inform Centrelink if, among other things, she started work with an employer.

13    As has been noted above, the Tribunal’s reasons related to two debts, identified as “Debt 1” and “Debt 2”. This appeal is only concerned with a limited aspect of the way the Tribunal dealt with the question of whether there was a reason to waive recovery of Debt 1. The issues raised concern the way the Tribunal dealt with Ms Lyall’s argument that she had reported the change in circumstances involving her employment and her submission, as recorded by the Tribunal at [112] of its reasons, that she “suspect[ed] that she was reporting as otherwise the debt would have been raised earlier”.

14    The Tribunal set out Ms Lyall’s position and the evidence in relation to the reporting of income in connection with Ms Lyall’s employment with Healthscope in its reasons at [79]-[86]. The Tribunal said:

[79]     Miss Lyall states she did advise Centrelink that she had started work at Healthscope. She points to the lack of information in her Centrelink file before 16 September 2011, and says she advised Centrelink of her employment with Healthscope when she signed a contact with Healthscope on 4 July 2011. She claims to have reported her earnings every fortnight. She did not check her parenting payment statements as she had faith she was being paid correctly.

[80]    The Centrelink record of a discussion with Miss Lyall on 9 December 2011 states “Customer said she did some training but never started work.” It was stated an earning worksheet was sent, and an earnings worksheet was sent to her the same day. Miss Lyall states it is false to say she reported she had done some training but did not start work.

[81]     It does not appear that a response was sent to this earnings sheet, and a debt was not raised until 5 December 2014.

[82]     On 4 December 2014, a record of contact with Miss Lyall states that when she was advised that she had not reported income she:

... apologised for this and said she had issues with her ex at the time and he hasn’t paid child support and only started paying in Nov 2013. LYALL said she was having a tough time and when she got the job in 2011 she was contacted by CLK and was advised to declare her income online. LYALL said she had issues with this and did not have an internet connection ... LYALL said that at the time she knew that she could leave it until the end of the financial year and just pay any debt back.

[83]    Miss Lyall said this was not true, as her ex-husband had always paid child support and provided information to show that she was paid child support. She also said that because only her surname appears, this could be anyone. Neither argument convinces the Tribunal that what she said at that time was not recorded accurately, or that this note is not in relation to her, or that she did not knowingly fail to comply with her obligation to report income.

[84]    In seeking review of the decision to raise and recover the debt on 9 September 2020, Centrelink reports Miss Lyall said she sought a review because “I had to return to work and I was never on benefits before. I didn’t realise there was a requirement to report earnings, and my income was quite low.”

[85]    Miss Lyall denies that she said this, and states it does not make sense as she reported income from employment in 2004 and 2008. She points to the lack of records of any contact she had with Centrelink from 4 July 2011 to 16 July 2011.

[86]    From the information on the Centrelink file, Miss Lyall failed to provide information about her income, both according to what she told Centrelink in 2020 and in the lack of response to the earnings sheet sent to her on 9 December 2011.

(Footnotes omitted.)

15    Notably, at [83], the Tribunal expressly concluded that Ms Lyall had not satisfied the Tribunal that what she had told the Centrelink officers was not recorded accurately, or that the note may not have related to her, or that she did not knowingly fail to comply with her obligation to report income. Further, the conclusion recorded at [86] indicates that the Tribunal was prepared to accept and act on the information recorded on the Centrelink file. Also consistently with that view of the evidence before it, the Tribunal at [107] of its reasons recorded a finding that “Debt 1 resulted from Miss Lyall failing to report her income”.

16    What Ms Lyall was recorded as having said to the Centrelink officers was inconsistent with her being unaware that she was required to report income. It is also apparent from what Ms Lyall told the Tribunal (recorded at [79] of the Tribunal’s reasons) that her position before the Tribunal was that she was aware that she was under an obligation to inform Centrelink if she began work or started earning income, and that she had in fact acted consistently with that obligation by making fortnightly reports of her income to Centrelink.

17    After determining that the debt could not be written off under s 1236 of the Act or waived under s 1237A of the Act, the Tribunal turned to consider the power to waive the debt in “special circumstances” under s 1237AAD of the Act.

18    At [108] of its reasons, the Tribunal extracted the terms of s 1237AAD of the Act, which I have set out at [11] above. The Tribunal then said (at [109]-[113]):

[109]     A person may fail to comply with a provision of the Act if they fail to give information required by the Secretary under a notice issued under s 68 of the Administration Act. Section 68 of the Administration Act requires a person who is receiving a social security payment to provide information to the Department if a specified event or change of circumstances occurs.

[110]    Section 72 of the Administration Act contains the requirements for a notice. A notice:

•    may be given by post,

•    must specify how the person is to give the information,

•    the period within which they are required to give the information, and

•    must specify it is an information notice given under social security law.

[111]    Miss Lyall was provided information notices issued under s 68 of the Administration Act requiring her to tell Centrelink if she started work, including a notice dated 18 May 2011, before the start of the debt period. Further notices requiring her to tell Centrelink if she started work were provided in the debt period. Notices issued during the period of Debt 1 advising Miss Lyall about the calculation of her payment do not include any earnings.

[112]     Miss Lyall said she did not read letters from Centrelink and ripped them up because she thought she did not need them as she had faith in the system. Miss Lyall said she knew reporting income was a requirement for parenting payment, as she had reported income in the past. She said she suspects that she was reporting as otherwise the debt would have been raised earlier.

[113]    The Tribunal does not accept Miss Lyall’s claim that her responses were falsely recorded by officers of Centrelink on more than one occasion, and finds she knowingly failed to comply with an information notice in relation to Debt 1. As she knowingly failed to comply with a provision of the Act, the debt cannot be partly or wholly waived under s 1237AAD of the Act.

(Footnotes omitted.)

19    It is evident from its use of the expression “knowingly failed to comply with an information notice” that the Tribunal’s conclusions with respect to the availability of the discretion in s 1237AAD related to s 1237AAD(a)(ii).

Ground 1 – failure to consider a clearly articulated claim

20    The principles concerning the obligation of the Tribunal to consider a claim relied upon by an applicant before it are not in dispute. The Tribunal would fail to perform its duty “if it failed to take account of a substantial and clearly articulated argument advanced by the applicant in support of [their] case”: Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421; [2019] HCA 3 at 436 [13], citing Dranichnikov v Minister for Immigration and Multicultural Affairs (2003) 77 ALJR 1088; [2003] HCA 26 at 1092 [24]-[25]. In NABE v Minister for Immigration and Multicultural and Indigenous Affairs (No 2) (2004) 144 FCR 1; [2004] FCAFC 263 at 20 [63], it was said that:

… a failure by the Tribunal to deal with a claim raised by the evidence and the contentions before it which, if resolved in one way, would or could be dispositive of the review, can constitute a failure of procedural fairness or a failure to conduct the review required by the Act and thereby a jurisdictional error.

21    Whether or not a matter has been considered can be a matter of inference drawn from the reasons as a whole: Jabari v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2023) 298 FCR 431; [2023] FCAFC 98 at 445 [55]. In Plaintiff M1/2021 v Minister for Home Affairs (2022) 275 CLR 582; [2022] HCA 17, Kiefel CJ, Keane, Gordon and Steward JJ said (at 598-9 [24]):

Consistently with well-established authority in different statutory contexts, there can be no doubt that a decision-maker must read, identify, understand and evaluate the representations. Adopting and adapting what Kiefel J (as her Honour then was) said in Tickner v Chapman [(1995) 57 FCR 451 at 495], the decision-maker must have regard to what is said in the representations, bring their mind to bear upon the facts stated in them and the arguments or opinions put forward, and appreciate who is making them. From that point, the decision‑maker might sift them, attributing whatever weight or persuasive quality is thought appropriate. The weight to be afforded to the representations is a matter for the decision-maker. And the decision-maker is not obliged “to make actual findings of fact as an adjudication of all material claims” made by a former visa holder.

(Footnotes omitted.)

22    These statements of principle derive from the context of particular kinds of decision-making under the Migration Act 1958 (Cth). Precisely what is required must ultimately be a matter of statutory construction arising from a consideration of the particular decision, the surrounding circumstances in which it is to be made and the nature of the hearing in the Tribunal. The parties accepted, however, that these principles were generally applicable to the function of the Tribunal in the present case.

23    Ms Lyall contends that the Tribunal failed to consider a clearly articulated claim, namely the claim recorded by the Tribunal at [112] that she “suspect[ed] that she was reporting as otherwise the debt would have been raised earlier”. That claim and the way the Tribunal responded to it must be understood against the background of the discussion and findings earlier in the reasons of the Tribunal.

24    That discussion indicates that Ms Lyall had also advanced an essentially similar claim in different terms. She advanced a positive case that she had in fact reported the change in circumstances that arose from her employment with Healthscope. The claim that Ms Lyall “suspect[ed]” that “she was reporting” was, in substance, a weaker version of that claim, framed in terms of speculation rather than a direct contention. In substance, however, the fact that Ms Lyall made the claim required the Tribunal to consider whether or not it was satisfied that she had not reported the change in her circumstances to the Department when she began working for Healthscope.

25    The Tribunal expressly set out, at [112], Ms Lyall’s contention that she suspected that she was reporting. It then immediately set out its conclusion that Ms Lyall knowingly failed to comply with the notice at [113]. The Tribunal cannot have “overlooked” the claim, given that it set it out in the reasons immediately before expressing its conclusion. Ms Lyall’s contention was that the Tribunal had not addressed the claim by way of reasons or conclusion.

26    The Tribunal’s reasons at [113], when read together with the earlier discussion at [79]-[86] of its reasons (which I have set out at [18] above), indicate clearly enough that the Tribunal did not accept that Ms Lyall did in fact report changes to her income, and found that she had conversations with officers of Centrelink in the terms recorded by them. The Tribunal evidently regarded it as inherently improbable that Ms Lyall’s conversations with Centrelink officers were repeatedly incorrectly recorded. It is implicit in what the Tribunal said at [113] that it accepted that Ms Lyall did in fact have conversations to the effect recorded by the Centrelink officers and set out in the reasons of the Tribunal at [80] and [82]. Those conversations as recorded included acceptance by Ms Lyall that she knew that she was required to inform Centrelink if she commenced work, or commenced earning income, and included an apology for not reporting her income from the Healthscope employment. Although the reasoning actually recorded in [113] is economically expressed, that is readily explicable by the fact that the Tribunal had already addressed the terms of the notes of the Centrelink officers which appeared on Ms Lyall’s file earlier in its reasons, had accepted that it was prepared to act on the basis that the notes were accurate, and had accepted that Ms Lyall did not report her income. I do not consider that the terms of [113] indicate that the Tribunal overlooked or failed to deal with the claim that Ms Lyall had received income in the past, or that she “suspected” that she had.

27    The claimed “suspicion” that Ms Lyall had reported her income in the period when she was working for Healthscope was said to be supported by Ms Lyall’s submission that “otherwise the debt would have been raised earlier”. That submission was not such as to require the provision of a separate express answer in order for the Tribunal to fulfil its obligation to give reasons. What the Tribunal was required to set out was its own reasons for the decision it reached. It was open to the Tribunal to rely on its conclusion that the Centrelink officers had accurately recorded their conversations with Ms Lyall as a matter sufficient to conclude that Ms Lyall had not reported her income as she “suspected” she had.

28    Ms Lyall submitted that the issue which the Tribunal addressed at [78]-[86] of its reasons was different from that which it addressed at [112]-[113]. The reasoning and findings at [78]-[86] were directed to the question of whether the debt arose wholly or partly because Ms Lyall had “failed to provide information in relation to [her] income from personal exertion”, which arose under s 1228B(1)(c) of the Act. I accept that was a different statutory question than that which arose under s 1237AAD of the Act, but the factual findings made by the Tribunal in the earlier part of its reasons were also directly relevant to the latter issue. The Tribunal’s reasons and conclusions at [78]-[86] were only consistent with a conclusion that Ms Lyall had knowingly failed to inform the Department of her work for Healthscope and the change in her income.

29    Ms Lyall also placed reliance on [116] of the Tribunal’s reasons where it found that it was prepared to infer that Ms Lyall had not knowingly failed to report the income to which Debt 2 related. Debt 2 arose during a different period, in which Ms Lyall had been reporting income, but had under-reported the amount of income. The Tribunal’s conclusion with respect to Debt 2 is not inconsistent with its conclusion that Debt 1 arose from a knowing failure by Ms Lyall to report income, and it does not suggest a failure by the Tribunal to engage with the evidence or submissions relating to Debt 1.

30    For these reasons, ground 1 is not established.

Ground 2 – failure to give adequate reasons

31    The Tribunal was required to give reasons for its decision, either orally or in writing: AAT Act, s 43(2). Where, as in this case, the Tribunal gives reasons in writing, the reasons are required to include the Tribunal’s findings on material questions of fact and a reference to the evidence or other material on which the findings are based: s 43(2B). In the context of the obligation imposed by s 43(2B) of the AAT Act, it has been said that “s 43 is not to be construed with a pedantic eye but in a practical common sense way in order to determine, in substance, whether the decision conveys sufficient of the decision making process to enable the parties and other interested persons to properly understand it”: Australian Postal Corporation v Wallace (1996) 41 ALD 455 at 457.

32    The Tribunal is required to “set out its findings on those questions of fact which it considered to be material to the decision which it made and to the reasons it had for reaching that decision”: cf Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323; [2001] HCA 30 (Yusuf) at 346 [68]; Secretary, Department of Employment and Workplace Relations v Homewood (2006) 91 ALD 103; [2006] FCA 779 at [40]. A function of the statement of reasons which informs what is required of the Tribunal as a matter of statutory construction is that the statement must explain the actual process of reasoning by which the Tribunal made its decision and must do so in sufficient detail to enable a court to see whether the decision involves an error of law; cf Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at 505 [65]; Yusuf at 346 [69]. The Tribunal is not necessarily required to refer in its reasons to every piece of evidence or to every contention or argument: Applicant WAEE v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 236 FCR 593; [2003] FCAFC 184 at [46].

33    Ms Lyall acknowledged that her argument that the Tribunal’s reasons were inadequate was closely related to the argument she advanced in relation to ground 1. She submitted that a major difficulty with the Tribunal’s reasons at [112]-[113] was that it did not actively engage with the contention that Ms Lyall reported her income. I do not accept this submission. The speculative version of the claim that Ms Lyall advanced was adequately addressed for the reasons I have given in relation to ground 1, and it was not obviously connected with the particular question of whether Ms Lyall’s failure to comply with the obligation to report income was a “knowing” one.

34    Insofar as Ms Lyall complains about the failure of the Tribunal specifically to address the finding that Ms Lyall had “knowingly” failed to comply with a requirement, the Tribunal’s reasons demonstrate that Ms Lyall’s position before the Tribunal had been that she had appreciated at the relevant time that she was under an obligation to report changes in her income; her position was that she had in fact done so. Moreover, the Tribunal had also recorded, in [112] of its reasons, that, although Ms Lyall claimed to have ripped up the letters without reading them “because she thought she did not need them”, she “said she knew reporting income was a requirement for parenting payment, as she had reported income in the past”. That is, she had admitted that she was aware of her obligation to “report income”, which was in fact imposed by s 68 of the Administration Act, whether or not she was aware of the content of a particular notice or the fact that it was her receipt of the notice that had the legal effect of imposing that acknowledged obligation.

35    Ms Lyall further submitted that there was considerable difficulty in understanding the Tribunal’s justification for the finding that she had “knowingly failed to comply with an information notice” because the reasons of the Tribunal omitted any evaluation of Ms Lyall’s assertion that she “suspected” that she was reporting her income. In my view, for the reasons I have given in relation to ground 1, the Tribunal’s reasons were adequate to explain why it had rejected Ms Lyall’s argument. While Ms Lyall’s contention that her responses to Centrelink officers were falsely recorded by them in the notes retained on her file was “a different proposition” from the proposition that she suspected that she had been reporting her income, the Tribunal’s rejection of the former proposition was substantially inconsistent with any acceptance of the latter. In my view, what the Tribunal said at [112]-[113], when read in light of [79]-[86], adequately explained why it did not accept that Ms Lyall’s claimed “suspicion” that she had been reporting income was correct.

36    For these reasons, ground 2 is not established.

Conclusion

37    Ms Lyall has not established that the Tribunal’s decision was affected by an error of law. The appeal must be dismissed.

Associate:

Dated:    31 October 2024