Editors --- "Disability support pension: portability; meaning of 'event'" [2011] SocSecRpr 19; (2011) 13(2) Social Security Reporter, Article 8

• SECRETARY TO THE DFHCSIA v MOURATIDIS
• Background
• Issues
• Decision
• Formal decision

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Disability support pension: portability; meaning of 'event'

SECRETARY TO THE DFHCSIA v MOURATIDIS

(Federal Court of Australia)

Decided: 24th March 2011 by Dodds-Streeton J.

Background

Mouratidis was in receipt of disability support pension when, on 23 May 2008, he accompanied his mother on a trip to Greece. His mother was 90 years of age at the time and suffering from Alzheimers. Mouratidis’ pension was payable for a period of 13 weeks whilst he was outside Australia.

Mouratidis returned to Australian on 22 August 2008, just prior to the expiration of the 13 week portability period. His mother remained in Greece.

On his return to Australia, Mouratidis notified the Secretary that he intended to return to Greece on 12 September 2008, with the intention of returning to Australia on or by 12 December 2008. Mouratidis returned to Greece on 12 September 2008.

On 30 October 2008, Mouratidis telephoned Centrelink for advice on the portability of his pension. He was informed that his pension payments would cease after 13 weeks as no new medical event had occurred to prevent Mouratidis and his mother from returning to Australia within that period. Mouratidis returned to Australia on 9 December 2008.

After his return to Australia, Mouratidis’ mother was admitted to hospital in Greece, suffering a broken right hip.

On 28 December 2008, Mouratidis returned to Greece. As he had not returned to Australia by 29 March 2009, his pension payments were stopped on that date.

At some time prior to 16 July 2009, Mouratidis requested an extension of the time in which his pension could be paid whilst outside Australia. On 16 July 2009, his request was refused on the basis that Mouratidis’ mother was hospitalised prior to his departure from Australia, and therefore the requirements of s.1218C of the Social Security Act 1991 (the Act) were not met.

Mouratidis appealed the decision to the SSAT, who determined that Mouratidis’ pension should continue to be paid in the period following 29 March 2009. The Secretary then applied to the AAT for a review of the decision.

On 30 April 2010, the AAT affirmed the decision of the SSAT.

The Secretary appealed the decision to the Federal Court of Australia.

Issues

The issues for determination by the Federal Court were whether:

(a) An appreciable deterioration in an existing illness can constitute the occurrence of a serious illness which is an ‘event’ within the meaning of s.1218C(1)(b) of the Act; or whether, on the contrary, the term ‘event’ requires a sudden and material change and a specific identifying incident rather than a condition or illness which came on gradually.

(b) An ‘event’ which has occurred during the person’s absence from Australia cannot be relied on to extend the specific portability period under s.1218C (1)

(c) If the person returns to Australia, albeit briefly, and then again travels overseas; or whether, on the contrary, any return to Australia automatically terminates the preceding portability period, so that on the person’s subsequent departure from Australia, a fresh portability period commences, the extension of which would require the occurrence of an ‘event’.

Decision

The Federal Court noted that the AAT had, in effect, extended one of the portability periods arising in this matter, but had failed to identify which period it had extended. The Federal Court found that the most appropriate construction of the AAT’s reasons for decision was that the AAT had extended the portability period which commenced on 12 September 2008. This was because the AAT had unambiguously determined that the ‘event’ which gave rise to the exercise of the discretion was the appreciable deterioration in Mouratidis’ mother’s health as at 2 December 2008.

The Court then considered whether Mouratidis’ return to Australia on 9 December 2008 would prevent the extension of the portability period which commenced on 12 September 2008. The Secretary had submitted that the Act imposes a temporal scheme where (in the context of extensions of the portability periods specified in the Act) any return to Australia extinguishes the discretion to extend, and terminates any extension already granted.

The Court considered that the 13 week portability period that commenced on 12 September 2008 could have been extended for an indefinite period after its expiration, provided that the conditions of s.1218C were otherwise satisfied. The Court opined that Mouratidis’ return to Australia on 9 December 2008 did not exclude the discretion to extend the portability period commencing on 12 September 2008.

The Court found that s.1218C does not, in its terms, prohibit the extension of a specified portability period either before or after it has expired, after a person has returned to Australia or if it has already been exceeded. Nor does it require an application to be made within a specified time limit. The Court held that s.1218C is a remedial provision which should be liberally construed.

The Court noted that s.1213 provides that Part 4.2 of the Act applies to a person during a period (the period of absence) throughout which the person is ‘continuously absent from Australia’ if, immediately before the period of absence, the person was receiving a social security payment. The Court observed that the term ‘continuously’ was not defined in the Act and judicial consideration of the term indicates that the meaning of the word may vary according to the statutory context in which it appears. The Court commented that ‘continuously’ is not, in every case, construed literally to denote absolute continuity and may, in some contexts, apply despite a temporary break or interruptions within a given period. The Court did not consider s.1213 to pose an insuperable impediment to the construction of s.1218C that his Honour had adopted.

The Court concluded that, provided the relevant event which causes the person’s inability to return to Australia begins or occurs during the period of absence, the discretion under s.1218C to extend the portability period which commenced at the same time as the period of absence will arise. The extension may be made before or after the portability period specified in s.1217 has expired. The Court concluded that the portability period as extended prevails over any other delimitation or sequence of separate portability periods that would otherwise apply.

The Court further concluded that a temporary return to Australia after the commencement of a period of absence during which an event occurred neither automatically terminates an extension already granted nor precludes the retrospective extension of a portability period.

In relation to whether a deterioration in a pre-existing condition could be an ‘event’ for the purposes of s.1218C, the Court held that the deterioration in the condition must involve a change or a development in the condition during the period of the absence, which causes an inability to return to Australia. The Court held that there is no requirement that the illness be or involve an emergency, that it develop suddenly rather than gradually, or that it be of short duration.

The Court considered that the construction of ‘serious illness’ in Manolev was erroneous, was not warranted by the express terms of the provision nor implicitly required for its rational operation in the context of Part 4.2 as a whole.

Formal decision

The Court dismissed the appeal.

[S.O.]