MOULE v THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT [2017] NZHC 789

MOULE v THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT [2017] NZHC 789 [26 April 2017]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYCIV 2016-485-985[2017] NZHC 789BETWEEN ALAN MOULEAppellantAND THE CHIEF EXECUTIVE OF THEMINISTRY OF SOCIALDEVELOPMENTRespondentHearing: On PapersCounsel: Appellant in PersonC C McKay for RespondentJudgment: 26 April 2017JUDGMENT OF SIMON FRANCE J[1] Mr Moule lives in Australia but receives New Zealand superannuation. This is possible by virtue of a reciprocal arrangement between the countries. The amount of superannuation Mr Moule receives is dictated by what is known as the Australian notional rate. That in turn is influenced by Mr Moule's own circumstances.[2] Part of Mr Moule's circumstances is any income his wife earns. As ithappens his wife is a nurse who undertakes shift work. As a consequence her fortnightly income fluctuates, and with it Mr Moule's "notional rate".[3] The process by which all this is managed is:(a) Mr Moule advises the Australian authorities of the fortnightly income;(b) the Australian authorities calculate the notional rate and advise the New Zealand authorities;(c) the New Zealand authorities then calculate Mr Moule's entitlement.[4] The difficulty which arose is that the information from Australia generally came after Mr Moule's superannuation for the period was paid. This requiredregular review of payments that had been made. The review assessed whether Mr Moule had been overpaid or underpaid for the preceding period.[5] The outcome of these adjustments was that Mr Moule had been overpaid $1,597.67. The Ministry sought reimbursement. Mr Moule sought review by the Benefits Review Committee. He partly succeeded in that the review panel rejected reimbursement prior to the time when it considered Mr Moule was on notice as to the difficulties and the likely need for adjustments. This reduced the recoverable debt to $674.61. Mr Moule appealed further to the Social Security Appeal Authority.[6] The amount of the debt was not in dispute. However, statutory provisions control the ability of the Chief Executive to recover the debt. Section 86(9A) of the Social Security Act 1964 (the Act) sets out a collection of five factors which, if allare present, prevent recovery. In summary form these are:(a) the overpayment was due, wholly or partly, to Ministry error;(b) the recipient did not intentionally contribute to the error;(c) the recipient received the money in good faith;(d) the recipient has changed his or her position believing the money was rightly received;(e) it would be inequitable in the circumstances to permit recovery.[7] The Social Security Appeal Authority concluded that the Ministry was not responsible for the overpayment.1 In other words, there was no Ministry error. Error is defined in the Act as:1 Moule v Chief Executive of Ministry of Social Development [2015] NZSSA 92.(9B) In subsection (9A), error–(a) means–(i) the provision of incorrect information by an officer of the department:(ii) any erroneous act or omission of an officer of the department that occurs during an investigation under section 12:(iii) any other erroneous act or omission of an officer of the department; but(b) does not include the simple act of making a payment to which the recipient is not entitled if that act is not caused, wholly or partly, by any erroneous act or omission of an officer of the department.[8] The Authority's reasoning on error was:2The first issue we must consider is whether or not there has been any error on the part of the Ministry which has resulted in the debt. Paragraph 2.5 of the Section 12K Report sets out the dates the information relating to theappellant's Australian notional pension entitlement was received by Workand Income New Zealand. It appears that the debts have arisen primarily because the information from Australia was received too late for the Ministry to adjust payments, which had already been made; for example on 10 February 2014 the Ministry received advice which it had actioned on 14 February 2014, in relation to the period 29 November 2013 to 11 February 2014.It seems highly unsatisfactory that the Chief Executive does not have a better system in place for reviewing entitlement to New Zealand Superannuation paid into Australia. We are not satisfied that it can be said that there was an error on the part of the Ministry of Social Development in New Zealand which caused or partly caused the debt. The debt arose because theappellant's wife works, her wages fluctuate and there is a delay in Centrelinkproviding the information necessary to ensure that the appellant'sNew Zealand Superannuation is adjusted at a time which will avoid overpayment. As we are not satisfied that the debts were caused by an error by an officer of the Ministry we cannot direct that the debt not be recovered pursuant to s 86(9A) of the Act.[9] As all five considerations must be present before the Chief Executive is disentitled to recover the debt, this conclusion was fatal to Mr Moule's appeal. Henow appeals to this Court. Such an appeal is by way of the case stated procedure and is limited to questions of law. The question posed here is:2 Moule, above n 1, at [17]–[18].[29] The question of law stated by the Authority for the opinion of the Court is:(i) Was the Authority's conclusion that the appellant's debt wasnot caused by an error by an officer of the Ministry inconsistent with the true and only reasonable conclusion available on the facts in circumstances where:(a) there is a delay by Centrelink in providing theinformation necessary to ensure that the appellant'sNew Zealand Superannuation was adjusted in time to avoid an overpayment and/or(b) there were delays by Ministry staff in processing that information?[10] The law on when a factual error may constitute an error of law is set out inBryson v Three Foot Six Ltd.3 An appellant's task is therein described as a very high hurdle, requiring Mr Moule to establish that the contrary factual conclusion for which he contends (namely that there was an error by the Ministry) was the true and only reasonable conclusion available.4[11] By consent, the present appeal is being determined on the papers. Mr Moule has not filed written submissions but included a series of bullet points in the common bundle he filed. In summary they are that the Ministry was lax in not acting in a timely manner on the information provided to it by Australian authorities. Mr Moule notes that since an individual manager was appointed to his case in June 2015, there have been no further overpayments.[12] There is an aspect to this case where one's view of error depends on where one looks. The Ministry received reports from its Australian equivalent on average about 14 days after the end of the relevant superannuation period. Obviously it could not act before receiving this material, and so the incorrect payment is hardly its fault. On the other hand it chose to make what appear to be two monthly reassessments. That meant some of the information would have been in theMinistry's hands for two months before it was acted on.3 Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721.4 At [27].[13] Mr Moule's was a complex case, made particularly difficult by the inconsistent income he (through his wife) received. I consider it was open to theAuthority to conclude it was not the Ministry's error if the information it receivedwas in effect already too late to be fed into the relevant payment. A delay in recalculating did not contribute to the initial incorrect payment.[14] I accordingly conclude that a finding that the overpayment was due to a Ministry error was not the true and only reasonable conclusion. It was certainly reasonable for the Authority to see the overpayments as merely a product of the particular unusual circumstances. That a different system has since been implemented which has apparently addressed the problem is not to be equated with a finding of fault as regards the previous system. Improvement or adjustment to a situation is not synonymous with establishing error in the previous system.[15] The appeal is dismissed. The Ministry does not seek an award of costs._________________________Simon France J