Editors --- "Assurance of support: debt arising from assuree receiving special benefit; special circumstance" [2005] SocSecRpr 16; (2005) 7 Social Security Reporter, Article 16

• HENSHAW and SECRETARY TO THE DFaCS
• Background
• The issue
• The evidence
• The Department’s submissions
• The findings
• Formal decision

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Assurance of support: debt arising from assuree receiving special benefit; special circumstance

HENSHAW and SECRETARY TO THE DFaCS

(2005/616)

Assurance of support: debt arising from assuree receiving special benefit; special circumstances

HENSHAW and SECRETARY TO THE DFaCS

(No. 2005/616)

Decided: 29June 2005 by N. Isenberg.

Background

In about July 2002 Pouzideh married Moghaddam, Henshaw’s sister, in Iran. They applied for a spouse visa so that Pouzideh could travel to, and live in, Australia. Pouzideh declared that he intended to bring approximately $A40,000 into the country with him.

On 13 March 2003 Henshaw signed a Discretionary Assurance of Support Agreement (‘the Agreement’)in respect of Pouzideh giving an assurance of support for a period of two years at the request of Moghaddam and her mother, Nasiri. In March 2003Moghaddam moved to Australia from Iran and went to stay with the Henshaws. On 5 September 2003, Pouzideh arrived in Australia and was also given accommodation at the Henshaws. In October 2003 Pouzideh and Moghaddam left the home of the Henshaws.

On 11 November 2003 Pouzideh applied to Centrelink for income support and was granted special benefit from this date. On 17 December 2003 Centrelink advised Henshaw that Pouzideh had been granted special benefit from 11 November 2003 on the basis that Henshaw was either unable or unwilling to support Pouzideh. Because of her assurance of support, Henshaw was required to repay the special benefit payments made to Pouzideh.

The issue

The issue was whether Henshaw had an assurance of support debt to the Commonwealth and if so whether there were any grounds not to recover the debt.

The evidence

Henshaw gave evidence that Moghaddam had asked her to sign the Agreement and had told her that Pouzideh had no need of money but he would not be allowed to come and start a new life in Australia without that document being signed. Henshaw had made it clear to her sister and Pouzideh that she could provide support by way of accommodation in the family home and food, but that because of her limited resources she was unable to provide money or any other form of financial support.

Moghaddam gave evidence that she was aware that her sister had a lot of debts and was supporting their mother and would be unable to provide financial support to Pouzideh.

Nasiri said that they had discussed the Agreement with Moghaddam and she told Moghaddam that Henshaw supported her and that Henshaw’s financial situation was ‘not good’. Moghaddam told her that Pouzideh was a lawyer, that he owned his own company and earned earned 2.5 million Touman per month and that his only problem was “getting here”.

Pouzideh resided with the Henshaw family for three weeks. During that time Henshaw provided him and her sister with accommodation, specifically requested food and drinks, toiletries and other personal items, a television for use in their room. She gave Moghaddam money for trips out and treats and gave Moghaddam her credit card and PIN number so she and Pouzideh could get what they needed. She booked a holiday for them in Queensland but as they did not go she lost her money.

Henshaw gave evidence that soon after his arrival Pouzideh’s behaviour became unreasonable, hostile and aggressive. He behaved in an abusive manner towards her children and other members of her family and threatened her. He refused to comply with her reasonable requests to modify his behaviour in order to protect the wellbeing of the children. He made unreasonable demands on Henshaw’s resources by insisting that he would not sleep in the same bedroom as his wife, that particular foods be provided and that his food be cooked in particular ways. He refused an offer of more comfortable and spacious accommodation in two rooms at Nasiri’s house and refused at least two jobs that he was offered in order to support himself.

Pouzideh and Moghaddam left Henshaw’s home after an argument between Nasiri and Moghaddam in which Nasiri was assaulted in the presence of the Henshaw children.

Nasiri gave evidence that on the following day Pouzideh and Moghaddam returned to the house. Pouzideh forced his way into the house damaging the door and injuring Nasiri’s hand. Nasiri suffered an asthma attack. Pouzideh and Moghaddam gathered their possessions and left.

Henshaw’s evidence was that prior to leaving, Pouzideh and Moghaddam had not discussed their intention to leave, nor did she ask them to leave at any time. Mr Henshaw also gave evidence that he was trying to smooth things over and he did not ask them to leave. Moghaddam gave evidence that they were not asked to leave.

Henshaw and her mother obtained apprehended violence orders (“AVOs”) against Pouzideh and Moghaddam. Henshaw gave evidence that she had ongoing fears in respect of Pouzideh and was unable to continue to accommodate him in her house.

The Department’s submissions

The Department position was that as Pouzideh’s visa was in a class of visas determined by the Minister under s. 729(2)(f) of the Social Security Act 1991 (the Act) and as Henshaw had taken out an AVO against him, it was unreasonable for Pouzideh to accept the support of Henshaw. He was qualified to receive a special benefit and this was paid with effect from 11November 2003.

The findings

It was not disputed and the AAT found that Henshaw had validly executed an assurance of support.

The AAT considered whether Henshaw owed an assurance of support debt. It considered the terms of the obligations set out in the Agreement and found that she had a debt under s.1227 of the Act. As at 14 April 2005 the amount of the debt was $10,234.29.

Administrative error waiver

The AAT decided that s.1237A(1) of the Act was not applicable as Henshaw did not receive the special benefit payments and therefore could not be said to have received them in good faith. Further the debt was not solely due to administrative error.

Special circumstances waiver

The AAT then considered whether the circumstances were such as to warrant waiver under s.1237AAD of the Act.

On behalf of Henshaw it was submitted that the circumstances constituted “special circumstances” in which it would be appropriate to waive the debt in that it would be “unjust, unreasonable or otherwise inappropriate” for the Commonwealth to pursue recovery of the debt. It was submitted that Henshaw acted in good faith in providing accommodation and support to Pouzideh, but that owing to circumstances beyond her control, it became manifestly unreasonable for her to provide continuing accommodation and support to him. His behaviour, and that of Moghaddam, was such as to leave her no choice but to obtain AVOs against them.

The AAT was referred to the UN Convention on the Rights of the Child (to which Australia became a signatory in1990) which stipulates that children have the right to be protected from neglect and abuse (article 19). It was submitted that to require Henshaw to continue to accommodate Pouzideh would be unreasonable, inappropriate and in breach of this Convention.

On behalf of Henshaw it was submitted that she was induced by Moghaddam and her mother to sign the Agreement in favour of Pouzideh in order to assist him to enter Australia. She signed the Agreement on the basis that Pouzideh had genuinely entered the marriage and that she would be helping Moghaddam to establish a life in Australia with her new husband. She had been an innocent victim of Pouzideh’s fraudulent behaviour.

The AAT considered whether Henshaw or the taxpayer should bear the cost of the “inequities” in the case.

The AAT started with the premise enunciated in Gunn v Department of Social Security 3(9) SSR 131that: “In the ordinary course of events, those who are granted [a relevant entry permit] should not be supported by public funds... for the first two years of their being granted it”.

The AAT accepted that Henshaw disclosed to Pouzideh and Moghaddam the nature of the support that she was able to provide prior to the Agreement being signed. This offer was considered acceptable to them. She was generous in what she provided.

The AAT then observed that the clear terms of the Agreement were that she undertook to provide sufficient direct or indirect financial assistance “to the person’s covered by this assurance to ensure they will not rely on any form of Australian Social Security benefit...”

The AAT noted that although between herself, Moghaddam and Pouzideh, Henshaw attempted to make some lesser commitment, vis-à-vis the Commonwealth her obligation was clear. On this basis the AAT did not consider it appropriate to waive the whole of the debt.

The AAT then considered the decision of Stojanovic and Secretary, Department of Family and Community Services 2(6) SSR 78 where the applicant, for reasons beyond her control, was unable to continue to honour the assurance of support.

The AAT accepted that Henshaw had acted honestly and in good faith and had made reasonable efforts to accommodate and provide support to Pouzideh while he remained at her home. Henshaw had not asked Pouzideh to leave her home. Pouzideh left voluntarily and Henshaw’s ability to continue to support him was compromised, creating circumstances outside her control.

The AAT noted that Henshaw’s evidence was that notwithstanding his demands and the disruption to her family, she was prepared to support Pouzideh in her home. The AAT considered that she should meet that obligation. The AAT considered an amount of $80 to be a fair representation of the current cost of feeding and clothing a person who is living with a family and found that Henshaw should remain indebted to the Commonwealth at that rate.

The AAT found that there were special circumstances and it was appropriate that the debt should be waived to the extent that it exceeded the amount of any benefit paid to Pouzideh over and above the sum of $80 per week.

Formal decision

The AAT set aside the decision of the SSAT and in substitution decided that the amount of the assurance of support debt to be raised and recovered from Henshaw for the period 11 November 2003 to 4September 2005 was to be calculated at the rate of $80 per week.

[C.E.]