FEDERAL COURT OF AUSTRALIA

Ma v Secretary, Department of Social Services [2024] FCA 1467

ORDERS

THE COURT ORDERS THAT:

1.    The transcripts of the directions hearing before the Administrative Appeals Tribunal on 23 March 2023 and the final hearing before the Tribunal on 5 February 2024 which are included in the Joint Bundle of Authorities filed on 15 November 2024 are deemed to have been included in the application book accepted for filing on 22 July 2024.

2.    The application book as amended by order 1 is received as exhibit A-1.

3.    The appeal under s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) is dismissed.

4.    The applicant is to pay 50% of the respondent’s costs as agreed or assessed.

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

REASONS FOR JUDGMENT

PERRY J:

1.    INTRODUCTION

1    This is an appeal on questions of law under s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) from a decision of the Administrative Appeals Tribunal (second Tribunal) dated 16 April 2024 (AAT2) (the s 44 appeal). By that decision, the second Tribunal affirmed a decision of the Social Services and Child Support Division of the Tribunal (the first Tribunal) dated 16 May 2022 (AAT1) which found that the applicant had two debts to the Commonwealth arising out of overpayment of Austudy, namely:

(1)    a debt in the sum of $17,643.38 with respect to Austudy payments for the period 3 April 2010 to 6 October 2011 (the first debt); and

(2)    a debt in the sum of $8,179.25 with respect to Austudy payments for the period 8 November 2011 to 30 June 2012 (the second debt).

2    While an application made pursuant to s 44 of the AAT Act is called an appeal, the application is instituted in the original jurisdiction of the Federal Court and is properly characterised as an application for judicial review of the lawfulness of the second Tribunal’s decision: see, eg, Wills v Chief Executive Officer of the Australian Skills Quality Authority [2022] FCAFC 10; (2022) 289 FCR 175 at [7] (Perry J); and Manikantan v Secretary, Department of Employment and Workplace Relations [2024] FCA 94 at [2] (Perry J). As I shortly explain, the Court has jurisdiction to review the second Tribunal’s decision for errors of law on an appeal under s 44(1) but has no jurisdiction to review the factual merits of the second Tribunal’s decision.

3    The s 44 notice of appeal asks the Court to make certain findings of fact, namely that:

(1)    the applicant satisfied the Austudy activity test between 7 October 2011 to 30June 2012 by studying more than 75% of the full-time study load; and

(2)    the applicant successfully completed 250 hours of study between 7 April 2010 to 1 June 2010.

4    The applicant also seeks orders for the matter to be remitted to the Administrative Review Tribunal (ART) for a determination of his study hours. In this regard I note that the ART replaced the Administrative Appeals Tribunal as and from 14 October 2024 and that item 25 of sch 16 of the Administrative Review Tribunal (Consequential and Transitional Provisions No 1) Act 2024 (Cth) provides that “[a]nything the court could have done in relation to the AAT before the transition time may be done in relation to the ART”.

5    The applicant filed written submissions in support of his s 44 appeal and provided a further detailed outline of his intended oral submissions at the hearing. The Secretary did not object to the outline being received, accepting that the issues raised in the oral outline did not go beyond those raised in the applicant’s written submissions, and had apparently been provided with a copy before the hearing. Nor did the Secretary object to the Court dealing with the applicant’s written submissions, which raised issues outside the questions of law and grounds articulated in his notice of appeal, as if all of the issues were set out in the notice of appeal. The applicant supplemented his written submissions and outline with oral submissions with the assistance of a NAATI accredited interpreter in English and Mandarin.

6    For the reasons set out below, the application insofar as it relates to the first debt is dismissed. The decision insofar as it relates to the second debt is set aside and remitted to the ART by consent on the basis explained in Part 7 below. The Secretary accepted at the hearing that this means that the ART will consider everything in relation to the second debt again, including whether it should be waived, and the applicant is therefore able to make all of the points which he wished to raise in the s 44 appeal on the remittal.

2.    EVIDENCE

7    The applicant sought to read his affidavits affirmed on 17 May 2024 and 1 October 2024. However, he relied upon them in order to prove that he satisfied the requirements of a full-time student for the purposes of the Social Security Act 1991 (Cth) (SS Act). The evidence is irrelevant and inadmissible both because the material in the affidavits was not before the second Tribunal and this Court does not in any event have jurisdiction to review the merits of the second Tribunal’s decision. As a result, at the hearing I did not allow the applicant to read the affidavits. That means that the affidavits were not in evidence before me on the s 44 appeal.

8    Oddly, the transcript of the directions hearing and final hearing before the second Tribunal were included in the Joint Bundle of Authorities. While not formally tendered, I understand from the inclusion of the transcripts in the joint bundle, the need for the transcript of the directions hearing to be before the Court in order to consider the applicant’s complaints of a lack of procedural fairness, and the pinpoint references to the transcript of the directions hearing in the Secretary’s written submissions which assume that the transcript of the directions hearing will be in evidence, that both parties intended that the transcript be received in evidence before me. The failure to formally tender the transcripts therefore appears to have been as a result of an oversight. In those circumstances, I consider that it is appropriate to make orders providing that the transcripts are taken to be included in the application book. Furthermore, while the parties clearly intended the application book to be in evidence before me, it was not formally tendered. As such, I have made orders receiving the application book in evidence as exhibit A-1.

3.    BACKGROUND

9    The applicant was in receipt of Austudy payments based on his status as a “full-time student” between 3 April 2010 and 30 June 2012. The application for Austudy was first granted by Services Australia (the Agency) on 3 April 2010 in relation to the applicant’s full-time study in a Certificate IV in Property Services at Open Training and Education (OTEN). Before the first Tribunal, the applicant gave evidence that he was also studying a Certificate IV in Building and Construction at the Building Institute of Training and Development (BITD) and that this was in fact the course he was undertaking when he began receiving Austudy in 2010.

10    On 20 December 2010, the applicant advised the Agency of a change in study details, being his commencement of a Diploma of Accounting at OTEN in 2011.

11    On 3 January 2012, the applicant’s Austudy payments were suspended due to a failure to provide documents requested by the Agency to evidence that the applicant was undertaking full-time study at OTEN. The Agency then sought details about the applicant’s enrolment directly from OTEN. Based on that information, the Agency determined that the applicant did not have a full-time study load between 3 April 2010 and 6 October 2011, and therefore had no entitlement to Austudy in that period. On 24 January 2012, the Agency raised the first debt in the sum of $17,643.38.

12    On 2 July 2012, the Agency cancelled the applicant’s Austudy payment from 1 July 2012 on the basis that the applicant had reached his allowable study time on 30 June 2012, being the natural duration of his Diploma of Accounting.

13    On 15 February 2013, an Authorised Review Officer (ARO) of the Agency affirmed the first debt and changed the cancellation date for the applicant’s Austudy payment from 1 July 2012 to 6 November 2011, on the basis that the applicant was undertaking part-time study for the period between 6 November 2011 and 26 July 2012. As summarised by the second Tribunal at [18], the ARO found that:

•    the Applicant was enrolled only for an approximate 48 percent load in the 2010 academic year, and most of the course hours were completed in the period 16 February 2010 to 2 April 2010, which was before the Applicant’s Austudy payments commenced;

•    the Applicant was enrolled in a Diploma of Accounting for the period 16 May 2011 to 6 October 2011 but did not complete any course work; and consequently

•    the Applicant was a part time student on and after 3 April 2010 to 6 October 2011; and

•    the Applicant was undertaking part time study for the period 6 November 2011 to 26 July 2012 and, therefore, it was not possible to restore Austudy during this period.

14    The effect of the ARO’s determination was that the applicant had no entitlement to Austudy for the period between 8 November 2011 and 30 June 2012. Subsequently, on 21 February 2013, a second debt of $8,179.25 was raised, being the debt for the period between 8 November 2011 and 30 June 2012.

15    On 26 October 2021, the applicant lodged an application for review with the Social Services and Child Support Division of the Tribunal. The first Tribunal affirmed the decision under review on the basis that the applicant was not taking at least 75% of the normal study load for the course in which he was enrolled for Austudy purposes. On 16 April 2024, the second Tribunal in AAT2 affirmed the decision in AAT1.

4.    THE TRIBUNAL’S DECISION IN AAT2

16    For present purposes, the second Tribunal’s reasons in AAT2 can be summarised as follows.

(1)    The relevant law is contained in the SS Act and the Social Security (Administration) Act 1999 (Cth) (the Administration Act). Policy advice in the Guide to Social Security Law will be taken into account unless there are cogent reasons not to (at [22]).

(2)    Relevantly:

(a)    section 568 of the SS Act outlines the general rules for qualification for an Austudy payment, which include that the person satisfies the “activity test”;

(b)    section 569 provides that a person satisfies the activity test if they are undertaking qualifying study as defined in s 569A of the Act;

(c)    under s 569A, a person is “undertaking qualifying study” if, among other things, the person is “a full-time student” in an approved course of study in which they are enrolled (see sections 569C and 569D);

(d)    to be considered a full-time student for Austudy purposes, s 569C of the SS Act requires that the applicant undertake at least 75% of the normal amount of full-time study in respect of the course for that period (at [29]; see also the Guide at 1.1.F.230 cited by the second Tribunal at [23]).

(e)    further the Guide at 3.3.4.60 provides in relation to OTEN courses that:

OTEN considers students to be full-time if they are doing 16 hours of coursework a week.

…

OTEN provides a flexible course model which encourages students to complete courses at their own pace with no penalty for not completing work. However, if they are receiving Austudy, they should complete their study in the normal time it takes to complete the course.

(AAT2 at [29].)

(3)    Central to the question of whether the applicant qualified for Austudy during the relevant period is whether he was studying full-time.

(4)    The second Tribunal found at AAT2 [12]-[13] that:

The Agency also sought the Applicant’s enrolment information for 2010 and 2011 directly from OTEN.12 The information provided by OTEN confirmed that the Applicant had completed one assignment – on 27 April 2010 - after he was granted Austudy for full-time study at OTEN, and was not undertaking full-time study at any time during 2010 while receiving Austudy. Further, the Applicant was not enrolled in any study in 2011 prior to 16 May 2011. Although he enrolled in a Diploma of Accounting on 16 May 2011, he did not enrol for a full courseload and did not complete any study.13

On the basis of the information provided by OTEN, the Agency determined that the Applicant did not undertake a full-time study load for the period 3 April 2010 to 6 October 2011, had nil entitlement to Austudy for this period and, raised a debt of $17,643.38 (the first debt).14

(5)    In footnotes 12, 13 and 14 to these findings, the second Tribunal referenced the evidence from Centrelink upon which the findings were based (documents T7, T12 and T15).

(6)    The study information provided by OTEN confirmed the following study loads for the courses in which the applicant was enrolled (at [28]):

(7)    The second Tribunal was satisfied that the Applicant studied a full-time study load between 7 October 2011 to 5 November 2011 as per the OTEN records (at [32]).

(8)    However, the second Tribunal did not accept the applicant’s submission that he was studying 75% of the normal amount of full-time study in the relevant periods based on a series of emails he exchanged with BITD and “using the TAFE NSW time allocation for the equivalent course ‘…to map the hours study for the BITD course’” (at [37]). Rather, the second Tribunal found at [40] that:

A finding that the Applicant met the activity test in relation to his study of the Certificate IV in Building and Construction requires accepting evidence of the Applicant which lacks credibility, is at times inconsistent, and is not sufficiently supported by documentary evidence. The information provided by ASQA does not include the hours of study completed by the Applicant but, is sufficient to support a finding the Applicant did not meet the activity test in relation to this study.

(9)    The second Tribunal concluded on this issue at [41] that “the academic and enrolment records before the Tribunal demonstrate the Applicant was either not enrolled in full-time study or did not satisfy the activity test during the relevant period. As such, he was not entitled to Austudy during the relevant period.”

(10)    The second Tribunal further found that:

(a)    it was appropriate for the Agency to cancel the applicant’s Austudy under s 94 of the Administration Act from 8 November 2011 (at [42]-[44]);

(b)    as the applicant received Austudy payments during the relevant period when he no entitlement to them because he was not undertaking full-time study, subs 1223(AB)(c) and (d) of the SS Act apply and the Austudy payments received by the applicant during both debt periods are debts owed to the Commonwealth (at [45]-[47]); and

(c)    having regard to the applicant’s circumstances, the second Tribunal was not satisfied all or any part of the debt should be waived under ss 1236(1), 1237A or 1237AAD of the SS Act (at [48]-[56]).

5.    DOES THE S 44 APPEAL RAISE A QUESTION OF LAW?

17    As explained at the outset, the Court has jurisdiction to entertain an appeal on a question of law only under s 44(1) of the AAT Act: Haritos v Federal Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315 at [85]-[86] (Allsop CJ, Kenny, Besanko, Robertson and Mortimer JJ) (following Brown v Repatriation Commission [1985] FCA 236; (1985) 7 FCR 302 at 304 (Bowen CJ, Fisher and Lockhart JJ); and Commissioner of Taxation v Brixius [1987] FCA 612; (1987) 16 FCR 359 at 363–364 (Forster, Fisher and Spender JJ). It follows that a purported question of law which concerns only the merits of the second Tribunal’s decision is beyond the Court’s jurisdiction and is not a basis for challenging the decision of the AAT2.

18    The principles by which it is determined whether an appeal under s 44(1) raises a question of law were summarised in Manikantan at [27]-[29] (Perry J) as follows:

Questions of law in this context include non-jurisdictional questions of law and mixed questions of fact and law: Haritos at [62](7) and (8). It is, therefore, incumbent on the Court to determine whether or not the notice of appeal contains a question of law in order to determine whether it is seized of the matter in the exercise of jurisdiction conferred by s 44.

In this regard, merely to assert an error of law or to invite the Court to embark upon a broad and hypothetical consideration of statutory provisions is not to state a question of law: Haritos at [92]-[93]. Rather, the Full Court in Haritos (at [94]) held that that question must be approached as a matter of substance, and further that:

“In cases of doubt, the Court should consider the notice of appeal, the alleged question or questions of law, the grounds raised, the statutory context, and the Tribunal’s reasons for its decision, and having considered all those matters, satisfy itself that there is in fact a question of law.”

However, while “the statement of the question of law with sufficient precision is a matter of great importance to the efficient and effective hearing and determination of appeals from the Tribunal … [a]ny requirements of drafting precision concerning the form of the question of law do not go to the existence of the jurisdiction …”: Haritos at [62](2) and (4) respectively; see also ibid at [97].

19    Furthermore, in considering whether, as a matter of substance, a question of law is raised, the fact that the applicant is self-represented is relevant. As Abraham J explained in Onassys v Comcare [2022] FCA 90 at [21]:

The fact that an appellant is unrepresented is a relevant matter to be taken into account:  see for example, Chen v Secretary, Department of Social Services [2019] FCA 1155 at [35]; Lim v Secretary, Department of Education, Employment and Workplace Relations [2008] FCA 1058 at [13].  The notice of appeal should be read fairly and as a whole, particularly in cases involving unrepresented parties:  Haritos at [104], citing Avetmiss Easy Pty Ltd v Australian Skills Qualifications Authority [2014] FCA 314 at [75]-[77].  Where as a matter of substance a question of law exists, the Court has a procedural discretion to grant leave for an amended notice of appeal to be filed:  Haritos at [107].  In appropriate cases, the Court may reframe the questions relied upon so as to give precision to an inelegantly specified question of law, however care must be taken, especially in the face of an objection to competency, not to “visit on a respondent party a judicially attractive question of law which the notice does not fairly raise”:  Secretary, Department of Education, Employment and Workplace Relations v Ergin [2010] FCA 1438 at [11]; Rana v Repatriation Commission [2011] FCAFC 124 at [14].

(Emphasis added.)

20    Thus the fact that the applicant may frame grounds in terms of an error of law such as that the decision was made without evidence or that there was a failure to consider relevant considerations does not mean that the grounds in substance raise an error of law, as opposed to impermissibly seeking a review of the merits of the second Tribunal’s decision in AAT2.

21    The s 44 notice of appeal identifies four purported questions of law:

(1)    the second Tribunal in AAT2 made an “important” finding of fact “which could not be supported by evidence, in term of OTEN study in the period from 7th Oct 2011 to 30th June 2012”;

(2)    with respect to the BITD, by reason of misinterpreting the Guide at 3.3.4.60, the second Tribunal “fail[ed] to apply the [average amount of full-time study] for the subjects the Applicant successfully completed between 7th April 2010 to 1st June 2010, and insist rely on the hours by the educational institute which no longer exist”;

(3)    the second Tribunal denied the applicant procedural fairness by denying him the opportunity to question the principal and teachers at the BITD with respect to his study hours which were not recorded by the Australian Skills Quality Authority (ASQA) but recorded in emails;

(4)    The second Tribunal denied the applicant procedural fairness “by denying original emails evidence forward to AAT which are not backdated or manipulated, where those emails establish correct enrolment date and failed subjects of study.”

22    The questions of law are framed in terms potentially identifying errors of law, namely, that there was no evidence to support a material finding of fact (question of law 1), the second Tribunal misapplied the law to the facts by reason of a misconstruction of the applicable law (question of law 2), and the second Tribunal denied the applicant procedural fairness in two respects (questions of law 3 and 4).

23    However, in substance the fourth question of law takes issue only with a finding of fact by the second Tribunal. This is confirmed by the focus in ground 2 of the notice of appeal upon the alleged unfairness of the second Tribunal “rejecting the use of forwarded original emails as evidence which documented the Applicant’s enrolment and assignment failures” and the emphasis on the importance of the emails to the applicant’s case before the second Tribunal. Contrary to ground 2, the fact that evidence is rejected does not establish procedural unfairness but a finding as to the weight, if any, to be accorded to that evidence. Purported question of law 4 and ground 2 do not therefore identify any question of law and need not be considered further.

24    It follows that I am satisfied that the Court has jurisdiction with respect to questions of law 1, 2 and 3 of the s 44 notice of appeal. The applicant also raised a number of issues outside the s 44 notice of appeal, as I explain below. As the Secretary did not object to the Court considering those further issues, I have also considered those issues.

6.    THE FIRST DEBT

6.1    Issues raised by the applicant’s submissions

25    In relation to the second Tribunal’s decision in AAT2 with respect to the first debt, the applicant submits that:

(1)    the decision was made without evidence, because the applicant completed significant study hours during a period in which the second Tribunal concluded that the applicant failed to satisfy the activity test (issue 1);

(2)    the decision was made without evidence, because the second Tribunal found that there were no hours allocated to subjects in which the applicant achieved competency and denied the mapping method provided by the applicant; (issue 2);

(3)    the second Tribunal failed to consider the completion of relevant study, including three additional units completed by the applicant by 1 June 2010; (issue 3);

(4)    the second Tribunal misinterpreted the term “undertaking” in the SS Act as only including units marked “competent” and excluding study on subjects not yet completed or failed (issue 4);

(5)    the second Tribunal did not consider the flexibility and variability of weekly study hours for the BITD course and instead applied a rigid requirement for study hours (issue 5);

(6)    the second Tribunal denied the applicant procedural fairness by refusing a request to obtain records from the BITD regarding failed subjects, assignments and allocated study hours (issue 6);

(7)    there were special circumstances warranting the waiver of the first debt as a result of the applicant providing information about his BITD course, but the respondent failed to assess the BITD course in determining the applicant’s eligibility for Austudy and failed to conduct a qualification check in a timely manner (issue 7); and

(8)    the second Tribunal erred in applying s 1237AAD of the SS Act by improperly considering financial hardship alone in assessing the debt, instead of other special circumstances such as administrative errors and the failure to conduct a qualification check in a timely manner (issue 8).

26    Issues (7) and (8) are not raised by the notice of appeal. However, as earlier explained, I have nonetheless considered them and find that they could not succeed for the reasons explained below.

6.2    The applicant’s challenge to the AAT2 finding at [40] that the applicant did not meet the activity test in relation to the BITD course (issues 1, 2, 4, 5, 7)

27    It will be recalled that the first debt related to the period between 3 April 2010 and 6 October 2011. A key contention underlying many of the issues raised in the applicant’s submissions is that the AAT2 did not properly consider the 250 hours of study he undertook in this period for the BITD course in determining whether the applicant was a full-time student.

28    The second Tribunal in AAT2 found (at [34]) that the applicant was “unable to provide a transcript or any documents which could evidence his academic record or the hours that he studied the Certificate IV in Building and Construction”. ASQA provided information to the respondent on 31 March 2023 pursuant to s 196 of the Administration Act indicating that:

    the applicant enrolled in a Certificate IV in Building and Construction with the BITD on 3 November 2008;

    the applicant completed two units by 23 April 2010; and

    no qualification was issued.

29    The information provided by ASQA did not indicate the number of hours of study undertaken by the applicant.

30    In response to these evidentiary difficulties, the applicant, as earlier explained, asked the second Tribunal to use the TAFE NSW time allocation for the equivalent course to map his hours of study for the BITD course, and further submitted that his record of personal development supported a finding that he was engaged in full-time study. The second Tribunal did not agree, finding that the applicant’s evidence lacked credibility and ASQA’s information was sufficient to support a finding that the applicant failed to meet the activity test in relation to that study, even though it did not indicate the number of hours studied by him: see AAT2 [40] (quoted above at [16(8)]).

31    Issues 1 and 2 are framed as “no evidence” grounds. It is an error of law at common law to make a finding of fact for which there is no evidence or factual basis in the sense that there is not a skerrick of evidence. However, it does not suffice merely to contend that the evidence was insufficient or that a wrong finding of fact was made: Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 356 (Mason CJ).

32    The difficulty for the applicant is that the second Tribunal’s finding at AAT2 [40] was expressly supported by the information provided by ASQA. As such, this is not a case where there was no evidence before the second Tribunal to support its finding at [40]. Rather, as a matter of substance the applicant seeks to challenge the weight given by the second Tribunal to the ASQA information and its rejection (on credibility grounds and due to insufficient support by documentary evidence) of the applicant’s case that his evidence and mapping approach establishes that he was studying 75% of the normal amount of full-time study for the BITD course in the first debt period. Those, however, are purely factual findings derived from the second Tribunal’s consideration in AAT2 of the evidence (and the absence of evidence) before it at the time of its decision. The applicant’s contentions ultimately therefore reduce to an assertion that the second Tribunal should have preferred the applicant’s evidence which is a question of fact only and therefore outside the jurisdiction of the Court to review: see, e.g. Palassis v Commissioner of Taxation [2011] FCA 1305 at [30] (McKerracher J). In other words, even if the second Tribunal’s finding at [40] is factually incorrect, as the applicant contends, that does not establish an error of law: Bond at 356 (Mason CJ).

33    Similarly, with respect to issue 7, the applicant contends that there are special circumstances for a waiver of the first debt because the second Tribunal failed to assess the BITD study in determining the applicant’s eligibility for Austudy. This submission is therefore premised on the correctness of the applicant’s contentions with respect to issues 1 and 2, which I have already rejected.

34    Other submissions by the applicant do not directly contest the merits of the second Tribunal’s conclusion at AAT2 [40]. Nonetheless, they are also premised on the Court accepting the applicant’s submission that the second Tribunal should have accepted his evidence as to the level of study he undertook for the BITD course in the first debt period. The problem with these submissions is that they contest findings which were neither made by the second Tribunal, nor necessary for the second Tribunal to make.

35    First, with respect to issue 4, the applicant submits that the second Tribunal disregarded time spent on units not yet marked competent (being 350 hours study in the BITD course) and therefore misinterpreted the meaning of “undertaking” in the SS Act. However, the second Tribunal’s finding at [40] in AAT2 was not based on its interpretation of the term “undertaking” in relation to the BITD course; nor, having concluded that there was no objective evidence before it of the hours undertaken by the applicant in undertaking the BITD course, did the second Tribunal make any findings based on whether the applicant had successfully completed or failed a subject in that course.

36    Secondly, with respect to issue 5, the applicant submits that the second Tribunal failed to consider the flexibility inherent in competency-based training courses. However, the second Tribunal was never required to consider the variable weekly study hours applicable to the BITD course.

37    It follows with respect to issues 4 and 5 that the findings which the applicant contends should have been made by the second Tribunal were unnecessary because the Tribunal had found (at AAT2 [40]) that there was no evidence of the hours of study undertaken by the applicant in relation to the BITD course. Consequently, there was no need for the second Tribunal to consider whether subjects were completed or failed, or whether a variable weekly study hours requirement should be applied, and therefore no error of law in the second Tribunal having failed to do so.

6.3    Alleged failure to consider a relevant consideration

6.3.1    Relevant principles

38    The applicant also frames other grounds in terms of a failure to consider. A failure to have regard to a relevant consideration which affects the exercise of power is an error of law and gives rise to jurisdictional error: see, eg, Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 39-40 (Mason J) and 56 (Brennan J); Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323 at [37]-[39] (Gaudron J) and [82]-[84] (McHugh, Gummow and Hayne JJ, Gleeson CJ agreeing). As Kiefel and Bennett JJ explained in Minister for Immigration and Multicultural and Indigenous Affairs v Huynh [2004] FCAFC 256; (2004) 139 FCR 505 at [71]:

A relevant consideration in an administrative law sense has a limited meaning. It is one which the decision-maker is bound to take into account in making the decision in question. The factors which the decision-maker is bound to take into account are determined by the construction of the statute conferring the discretion. If they are not stated, they are to be determined by implication from the subject-matter, scope and purpose of the Act …

(Emphasis added.)

(See also Martincevic v Commonwealth [2007] FCAFC 164; (2007) 164 FCR 45 at [59] (Finn, Kenny and Greenwood JJ).)

6.3.2    Alleged failure to consider three units in the applicant’s study load (issue 3)

39    In relation to issue 3, the applicant contends that the second Tribunal in AAT2 failed to consider three additional units which he completed by 1 June 2010 and, as a result, the second Tribunal incorrectly assessed the applicant’s study load. The alleged failure to consider relates to specific evidence in an ASQA record before the AAT2. There is nothing, however, to suggest that the three additional units are mandatory relevant considerations under the SS Act and that the failure to consider them is, therefore, an error of law. Furthermore, while the second Tribunal did not refer specifically to the three units in which the applicant achieved a competent result on 1 June 2010, that information, as the Secretary submits, could not have altered the second Tribunal’s ultimate conclusion at [40] that “[t]he information provided by ASQA does not include the hours of study completed by the Applicant but, is sufficient to support a finding the Applicant did not meet the activity test in relation to this study”.

6.3.3    Failure to consider relevant considerations in determining whether to waive the debt (issues 7 and 8)

40    Issue 8 contends that the second Tribunal erred in applying s 1237AAD of the SS Act by improperly considering financial hardship alone in determining whether to waive the debt and in failing to consider administrative error and the failure to conduct a qualification check in a timely manner.

41    Section 1237(1) of the SS Act confers power on the Secretary to waive a debt under other provisions of the Act in the following terms:

1237 Power to waive Commonwealth’s right to recover debt

Secretary’s limited power to waive

(1)     On behalf of the Commonwealth, the Secretary may waive the Commonwealth’s right to recover the whole or a part of a debt from a debtor only in the circumstances described in section 1237A, 1237AA, 1237AAA, 1237AAB, 1237AAC, 1237AAD or 1237AB and, if the debt is an assurance of support debt, subject to section 1237AAE.

42    Relevantly, s 1237A(1) provides for the waiver of debt in circumstances of administrative error:

1237A Waiver of debt arising from error

Administrative error

(1)     Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.

Note:     Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).

43    While s 1237A imposes an obligation on the Secretary to waive a debt solely attributable to administrative error, s 1237AAD confers a discretion on the Secretary to waive a debt in “special circumstances”:

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.

Note 1:     Section 1236 allows the Secretary to write off a debt on behalf of the Commonwealth.

Note 2:     This section has effect subject to section 1237AAE in relation to an assurance of support debt.

44    The width of the discretion conferred by s 1237AAD is emphasised by the absence of any attempt to define what may constitute “special circumstances”.

45    The second Tribunal considered whether to waive the debt under ss 1237A and 1237AAD of the SS Act and considered whether the debt could be waived or written off. It expressed the opinion at AAT2 [51] that, in order for the debt to be waived under s 1237A of the SS Act, the debt must be attributed solely to administrative error. That construction is clearly correct on the plain words of the section. However, the AAT concluded at AAT2 [51] that there was no evidence that the debt here was caused solely by administrative error. There is no apparent error in that finding.

46    The second Tribunal also considered at AAT2 [52] whether all or part of the debt could be waived under s 1237AAD of the Act. It found, correctly, at [54], that, while the term “special circumstances” is not defined, it “should take into account all of the person’s circumstances and would usually be based on a combination of factors” (citing Oberhardt v Secretary, Department of Education, Employment and Workplace Relations [2008] FCA 1923; (2008) 174 FCR 157). The second Tribunal found that, while the applicant identified significant debts, he had not identified his assets. Nonetheless, based on the applicant’s evidence that his family trust would enable him to have sufficient income to meet his basic needs, the second Tribunal found at AAT2 [56] that it was satisfied that there were no special circumstances warranting waiving all or any part of the debt. Again, there is no error of law apparent in that finding and none has been identified. Given the width of the discretion conferred by s 1237AAD, it was clearly relevant for the second Tribunal to have regard to a person’s financial circumstances in determining whether special circumstances exist. Further, the second Tribunal had already found that there was no evidence that the debt here was caused solely by administrative error. Nor is there anything to suggest that the failure to conduct a qualification check in a timely manner, as alleged by the applicant in issues 7 and 8, was a mandatory relevant consideration. Accordingly, as the Secretary submits, this ground is without merit and must fail.

6.4    Alleged breach of procedural fairness (issue 6)

47    By issue 6, the applicant contends that the second Tribunal denied him procedural fairness by refusing his request to obtain records from the BITD regarding failed subjects, assignments and allocated study hours. This issue was the subject of a directions hearing before the second Tribunal on 23 March 2023.

48    At the directions hearing, the applicant indicated that he wished to summon the BITD, including the former director of the BITD and two former teachers, in order to obtain his student records and to cross-examine the former director. The second Tribunal declined to issue a summons on the basis that it would be “completely unlikely” for the teachers to have any documents. The AAT2 also noted that the BITD had been closed since 2012 and “had an obligation to return records to ASQA”, such that better evidence could be obtained from ASQA. In declining the requested summons, the AAT2 issued a written direction to the respondent to request the ASQA to provide details of the applicant’s enrolment at the BITD.

49    The Tribunal is bound by the rules of procedural fairness: see by analogy VAAD v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 117 at [38] (Hill, Sundberg and Stone JJ). A person who might be affected by an adverse finding should be given the opportunity to adduce evidence or make submissions rebutting a potential adverse finding: Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82 at [101] (McHugh J).

50    In considering whether the requirements of procedural fairness have been complied with, it is relevant to have regard to the AAT2’s power to summons persons. The statutory framework within which a decision-maker exercises statutory power “is of critical importance when considering what procedural fairness requires”. Procedural fairness will also “depend upon the facts and circumstances of the particular case”: SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 at [26] (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ). At the time of the directions hearing, the second Tribunal was empowered under s 40A of the AAT Act to “summon a person to … appear before the Tribunal to give evidence” or “produce any document or other thing specified in the summons”.

51    The principles relating to the issue of subpoenas by a court are relevant to the issue of summons by the second Tribunal: see e.g. the approach adopted by Spender J in Cosco Holdings Pty Ltd v Federal Commissioner of Taxation [1997] FCA 1504; (1997) 37 ATR 432. A primary consideration is whether the documents are relevant, and a summons can be set aside if “manifestly irrelevant to the issues between the parties”: Trade Practices Commission v Kimberley Homes Pty Ltd [1989] FCA 262 at [11] (Hill J). The material sought may be of relevance if it “can reasonably be expected to throw light on” the issue in the principal proceedings: Cosco at 439-440 (Spender J).

52    In the present case, several factors weigh against a finding of procedural unfairness.

53    First, procedural fairness in the AAT Act did not require the second Tribunal to grant any summons desired by the applicant. Instead, s 40A was overlaid with considerations about the relevance of material subject to proposed summons. Those considerations were explained to the applicant by the second Tribunal at the hearing in AAT2 as follows:

The test of whether a summons should be issued has been described in various ways. For example, whether the material sought could reasonably be expected to throw light on some of the issues in the principal proceedings, or whether the documents relate to the proceedings such that there is a real possibility that they may assist in the resolution of issues in the proceedings, and then there’s also the fact that you – whether the material has relevance to the issues in dispute. It will not do so if it’s only – the relevance can only be speculated upon, and that reflects a balance struck between ensuring that the tribunal has relevant material before it with which it can make an informed decision on an application for a review and the reasonableness of the burden placed on a person to whom a summons is directed.

54    That explanation is, with respect, self-evidently correct.

55    Secondly, before asking the applicant to comment, the second Tribunal explained its difficulties with respect to the proposed summons to the teachers:

it seems, I mean, completely unlikely in my view that they would have any documents because the institution that they worked for would be responsible for the documents relating to – as a registered training authority, and given that it’s now 12 years ago or 13 years ago, I mean, I just can’t really see that there’s any possibility that there’s any document tucked away with either of the teachers.

56    The respondent agreed with this, “given the length of time and the usual course people may keep records for a couple of years” but submitted that “given that they were just teachers in an institution, they presumably would have turned the relevant documents back to the institution before they finished, or the both of them after (indistinct) working there for a period of time.”

57    Turning then to the proposed summons to the director, the second Tribunal explained that:

at this stage, Mr Ma, I don’t think I’m disposed to allow you or to grant you the issue of a summons to him for this reason: it is so long ago. The organisation’s been, what, closed down since, I think, about 2012. I mean, I think even for the ATO you only need to keep records for six or seven years …

58    Thirdly, the information received from ASQA comprised any information that the BITD would have been likely to have, given that the BITD had an obligation to return records to ASQA. As the second Tribunal explained to the applicant, ASQA was therefore more likely to have the records which the applicant sought in his proposed summons:

more importantly, is that the fact that the RTO had an obligation to return records to ASQA, so it seems to me that – and Mr Gauci has referred to the ASQA, Australian Skills Quality Authority webpage, and the reference to you can apply for student records in relation to ASQA because it’s responsible for registered training providers, and if RTO’s are to have a legal obligation to return the records to ASQA, I think that’s the best chance that you’ve got of finding anything.

59    The second Tribunal therefore suggested that the first step for the applicant was to apply to ASQA for his student records.

60    Finally, the second Tribunal proceeded to issue a written direction under s 196 of the Administration Act to the Secretary to request ASQA to provide details of the applicant’s enrolment at the BITD. Information was received by the Secretary pursuant to that direction, and was taken into account by the second Tribunal in due course in its decision in AAT2.

61    It is apparent therefore that there was no breach of procedural fairness in all of the circumstances. The request for the issue of the subpoenas was declined after the relevant principles were explained to the applicant and he was given an opportunity to comment on why the second Tribunal considered that it would be unlikely to result in the applicant obtaining the information which he sought. The second Tribunal also explained that the body which was more likely to have the information which he sought was ASQA and issued a direction to the Secretary to request that ASQA produce that material, which ASQA did. The fact that the information produced by ASQA did not ultimately include details of the hours of study undertaken by the applicant has no bearing on the question of whether he was afforded procedural fairness. Procedural fairness is concerned with process, and not with outcome.

7.    THE SECOND DEBT

62    With respect to the second debt, the Secretary conceded at [5(b)] of his written submissions that:

in relation to the second debt period, ... the Court should order that that part of the proceedings be remitted to the Tribunal for reconsideration to ensure that any recalculation is in accordance with Method 1, the 2 August 2012 OTEN progress reports as defined in paragraph 40 below and that the recalculation includes a consideration of the OTEN records relied on by the applicant at AB966-AB969 (with print-date 23 August 2022).

63    The basis on which the concession was made was developed in the Secretary’s written submissions at [40]-[44] as follows:

The Agency used two methods of calculation to determine the second debt period: Method 1 and Method 2. Both methods were developed on 3 August 2012 by the Agency … (3 August 2012 Assessment) to calculate the applicant's study load since he commenced study in the Diploma of Accounting (course code: 11362) on 7 October 2011. The methods used the information provided by OTEN on 2 August 2012 of the applicant's progress reports for 2011 to 2012 … (2 August 2012 OTEN progress reports). The underlying calculations were set out at paragraph 5.16 of the Secretary's SFIC dated 14 April 2023 …

Method 1 used 7 October 2011 as the enrolment date and calculated all assignments completed in 2011 and 2012 in this course over one continuous period. This method involved determining the average study load for each unit by (i) determining the period of enrolment (that is, from date of enrolment to the last date of assignment submission to determine the number of weeks it took the applicant to complete that unit); (ii) determining the hours completed for that unit based on the number of assignments completed; and then (iii) dividing the number of hours for the assignments completed by the period of enrolment to determine the average hours studied per week. The exercise was done in respect of each unit to determine when the applicant's study load fell below 12 hours per week. Applying Method 1, as at 6 November 2011, the applicant was undertaking less than 75% of the full-time study load.

Method 2 used the same method but used the enrolment date as the start-date for each respective calendar year's progress report. This meant calculation starts from 7 October 2011 for the year 2011 and starts from 31 May 2012 for the 2012 year. Applying Method 2, as at 8 November 2011, the applicant was undertaking less than 75% of the full-time study load.

In now reviewing Method 1 and Method 2, the Secretary contends that Method 1 is the correct method of calculation and is consistent with the Act. OTEN confirmed that the Diploma of Accounting (course code: 11362) required 890 nominal hours. This means the full-time duration of the course was 60 weeks in length (adding 2 weeks of holidays for every completed 19 weeks). In 2011, OTEN enrolled students for a period of 12 months and they would need to subsequently enrol in subjects as they went along. For the applicant, the enrolment period for the Diploma of Accounting (course code: 11362) would then be considered for the 12-month period commencing from 7 October 2011 to 7 October 2012. The total hours completed would have been divided by the enrolment period to determine a study load for the entire study period. This is consistent with Instruction 3.3.4.60 of the Guide which states that “OTEN considers students to be full-time if they are doing 16 hours of coursework a week” and is consistent with s 569E(1)(b) and 569E(1)(c) of the Act.

However, the 2 August 2012 OTEN progress reports at AB1492 records a “No Longer Enrolled" date of 22 December 2011. The Secretary proposes to recalculate the applicant's study load based on the "No Longer Enrolled" date of 22 December 2011 on the 2 August 2012 OTEN progress reports (AB1492). The No Longer Enrolled entry may indicate that the applicant was no longer enrolled in the course from 22 December 2011, and this would need to be considered in respect of the second debt period. The Secretary also proposes to consider the applicant's reliance on another version of the OTEN records for the Diploma of Accounting at AB966 to AB969 (with print-date 23 August 2022). The No Longer Enrolled entry may indicate that the applicant was no longer enrolled in the course from 28 November 2011, and this would need to be considered in respect of the second debt period.

64    I agree for the reasons given by the Secretary that it is appropriate for the second debt to be set aside and remitted to the ART for reconsideration according to law. In particular, I agree that the Secretary’s position is consistent with Instruction 3.3.4.60 of the Guide, which states that “OTEN considers students to be full-time if they are doing 16 hours of coursework a week”, and is consistent with s 569E of the SS Act (specifically (1)(b) and (c)), which provides:

569E Normal amount of full‑time study

(1)     For the purposes of this Subdivision, the normal amount of full‑time study in respect of a course is:

(a)     if:

(i)     the course is a course of study within the meaning of the Higher Education Support Act 2003; and

(ii)     there are Commonwealth supported students (within the meaning of that Act) enrolled in the course;

the full‑time student load for the course; or

(b)     if the course is not such a course and the institution defines an amount of full‑time study that a full‑time student should typically undertake in respect of the course—the amount so defined; or

(c)     otherwise—an amount of full‑time study equivalent to the average amount of full‑time study that a person would have to undertake for the duration of the course in order to complete the course in the minimum amount of time needed to complete it.

(2)     Without limiting subsection (1), the normal amount of full‑time study in respect of a course is an average, taken over the duration of the period for which the person in question is enrolled in the course, of 20 contact hours per week.

8.    CONCLUSIONS

65    For the reasons set out above, the s 44 appeal is allowed insofar as the second Tribunal’s decision affirmed the first Tribunal’s decision with respect to the second debt. However, the s 44 appeal is dismissed insofar as it seeks to challenge the legality of the second Tribunal’s decision affirming the first Tribunal’s decision with respect to the first debt. In these circumstances, the Secretary submitted that the appropriate order was that the applicant would pay half of the Secretary’s costs. I agree given that the Minister was wholly successful insofar as the first debt was concerned and properly conceded the appeal with respect to the second debt.

Associate:

Dated:    18 December 2024