ROBB v THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT [2014] NZHC 3347

ROBB v THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT [2014] NZHC 3347 [19 December 2014]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYCIV-2013-485-010884[2014] NZHC 3347IN THE MATTER of an appeal by way of case stated fromthe determination of the Social SecurityAppeal Authority at Wellington unders 12Q of the Social Security Act 1964BETWEEN HUGH ROBBAppellantAND THE CHIEF EXECUTIVE OF THEMINISTRY OF SOCIALDEVELOPMENTRespondentHearing: On the papersCounsel: Appellant in PersonT Bromwich for RespondentJudgment: 19 December 2014JUDGMENT OF MACKENZIE JI direct that the delivery time of this judgment is2 pm on the 19th day of December 2014.Solicitors: Crown Law Office, for RespondentCopy to: The appellant[1] This is an appeal under s 12Q of the Social Security Act 1964 (the Act) against a decision of the Social Security Appeal Authority (the Authority) delivered on 13 September 2012.1 The decision dismissed an appeal by the appellant against a decision of the respondent, upheld by a Benefits Review Committee, to establish and recover over-payments of unemployment benefit, sickness benefit, accommodation supplement and temporary additional support totalling $8,467.56 in the period from 19 February 2008 to 31 March 2009.[2] Under s 12Q, an appeal is available only on a question of law. A case was stated by the Authority on 20 December 2013, on the following questions of law:(i) Was there any evidence on which the Authority could base its conclusion that the appellant was not self-employed during the relevant time?(ii) Did the Authority err in law in finding that there was no basis for theMinistry to deduct expenses from the appellant's income?(iii) Was there any evidence on which the Authority could base itsconclusion that the debt arose because of the appellant's failure toadvise the Ministry of his income?[3] The appeal in this Court has a lengthy procedural history, which it is not necessary to describe. In accordance with directions given at various stages, I am todetermine the appeal on the papers, having regard to the respondent's submissionsand chronology dated 10 September 2014, the appellant's submissions which werereceived by the Registry by email on 1 October 2014, and the supplementary submissions of the respondent dated 22 October 2014.[4] The facts are set out in the case stated. The appellant was granted an unemployment benefit at the single rate from 11 January 2008, and an accommodation supplement plus temporary additional support from 19 February 2008. He was transferred from the unemployment benefit to a sickness benefit from 28 July 2008. He continued on that benefit until March 2009, when he completed a personal details form declaring gross income of $210 a week and requested to be transferred to non-beneficiary assistance. In May 2009 as a result of a data match with Inland Revenue (the Department), the Ministry established that the1 An appeal by Hugh Robb of Tauranga against a decision of a Benefits Review Committee [2012] NZSSAA 68.appellant had been employed by Television New Zealand (TVNZ) since 15 February 2008. Following confirmation of his income from TVNZ, an overpayment was established in respect of the period 25 February 2008 to 31 March 2009 amounting to $8,467.56.[5] In its decision, the Authority concluded that the overpayment had been correctly calculated. It rejected a submission that the rate of accommodation supplement and temporary additional support should have been assessed on the basisof the appellant's net income rather than his gross income. It also rejected a submission that the Ministry had failed to deduct expenses from his income in calculating the income to be charged against his benefit entitlement. The Authority accordingly confirmed the calculation of the debt.[6] Under s 86 of the Act, the Chief Executive is bound to take all reasonably practicable steps to recover that debt, except in certain specified circumstances. One of those is in s 86(9A), where the debt was caused wholly or partly by an error by an officer of the Department to which the debtor did not intentionally contribute. The Authority considered whether or not it could direct that the debt not be recovered pursuant to s 86(9A) of the Act. It held that the debt did not arise because of an error by an officer of the Ministry. It further held that the appellant could not have received the benefit payments believing that he was entitled to them. It therefore held that it could not direct that the debt should not be recovered pursuant to s 86(9A) of the Act.[7] The Authority went on to consider whether it could direct the respondent not to recover the debt, pursuant to the directions in ss 86(1) and 86A of the Act. It noted that this can be done only in unusual circumstances, and held that there was nothing unusual about this case. The appellant had simply failed to act honestly in his dealings with WINZ in failing to declare his income from employment over a lengthy period.[8] The first question posed in the case stated is whether there was any evidence on which the Authority could base its conclusion that the appellant was not self- employed during the relevant period. The question whether the contract between theappellant and TVNZ was a contract of employment, or a contract for services to be provided by the appellant as self-employed, was seen as relevant because the Authority took the view that the discretion in s 64(3) of the Act to deduct items relates to deductions by self-employed persons for expenses incurred in earning assessable income. Its finding that the appellant's income was from employmentresulted in the Authority finding that there was no deduction to be made in assessingthe appellant's estimated income.[9] Question 1 essentially turns on the Authority's finding that the appellant was an employee of TVNZ. In his submissions, the appellant contests the finding. He submits that his contract with TVNZ was a contract for services.[10] The Authority had information from TVNZ which specifically states the appellant is a casual employee who commenced work on 15 February 2008. Holiday pay was included in his hourly rate of pay and PAYE was deducted. The TVNZ report which was included in the evidence confirmed that the appellant had been employed by the business, as a casual employee working less than 30 hours per week, and that his pay rate included holiday pay. The report also confirmed that the appellant did not have to meet his own work related expenses. That was evidence on which the Authority could base its conclusion that the appellant was not self- employed at the relevant time.[11] The appellant submits that the Tribunal cannot have sighted an employment contract because none exists. It was not necessary for the Authority to have a contract to make the finding that it did. It was entitled to rely upon the information provided by TVNZ, and its characterisation of the nature of the relationship. That was evidence on which the Authority could base its conclusion that the appellant was not self-employed. This Court, in deciding this appeal on a question of law, is not required to consider that conclusion for itself.[12] For these reasons, I answer question 1 "yes".[13] Question 2 is whether the Authority erred in law in finding there was no basis for the Ministry to deduct expenses from the appellant's income. In answering thisquestion, the Authority's view that s 64(3) was concerned with deductions by self- employed persons for expenses incurred in earning assessable income is relevant.[14] Ms Bromwich for the respondent submits that the Authority erred in its interpretation of s 64(3). She submits that s 64(3) does not relate to the assessmentof the person's actual income, but rather it concerns the prospective estimation ofincome, and enables the respondent to estimate a beneficiary's income for thepurpose of determining their weekly payment to reflect the actual entitlement as closely as possible. On that interpretation, the issue of whether the contract was a contract of employment or a contract for services would not necessarily be significant in applying s 64(3). Ms Bromwich further submits that s 64(3) is notapplicable when retrospectively determining the appellant's actual income over therelevant period in the present case and could not have been used as a basis for theMinistry to deduct expenses from the appellant's income.[15] On this appeal, which is being dealt with on the papers, it is appropriate toaddress only those points which it is necessary for me to decide on the appellant'sappeal. Ms Bromwich's submissions seem at first sight to have considerable merit. Those submissions potentially raise a question of law about whether the Authority has applied s 64(3) correctly. However, it is not necessary or appropriate for me to address that question, because the Authority's factual findings mean that it does not arise. The Authority found as a matter of fact that the appellant had not established that there were any expenses to deduct. It said:[19] The appellant has not provided details of any amounts of the expenses which he alleges should be deducted from his income to the Authority. He has simply made vague assertions that they relate to wet weather gear, footwear, travel costs, food and child care costs. Clothing, travel and child care costs are living expenses normally paid from incomeand it is difficult to see why they should be deducted from the appellant'sincome before entitlement to benefit is assessed.[16] In the light of that factual finding, there was no evidence of any expenses which could have been deducted. The question of law does not arise.[17] I answer the second question "no".[18] The third question is whether there was any evidence on which the Authoritycould base its conclusion that the debt arose because of the appellant's failure toadvise the Ministry of his income. The appellant submits on this appeal, that he had made a declaration of his income on a number of occasions by telephone, but that those had not been noted on his file. He asserts that he has made a further declaration after the original hearing that had not been noted on the file. TheAuthority's conclusion on this issue was as follows:[27] In any event the appellant says that after February 2008 he contacted Work and Income New Zealand on a regular basis to advise of changes to his income. In his original letter of appeal to the Authority dated 9 January 2012 he claimed that he contacted the Ministry approximately once a month to declare his income. In his submissions of 31 (sic) April 2012 in response to the s 12K report he advised that he contacted Work and Income New Zealand approximately twice a month to declare his income. He has been asked by Work and Income New Zealand to provide the telephone number he called from to make his declarations to enable a check to be carried out but has stated that most of the calls were made from a phone box. He has not provided any telephone numbers. Nor has he provided any other details about the calls made or the locations they were made from. Work and Income have no record of the appellant contacting them to advise of his income until 30 March 2009 when he claimed to be earning $210 per week as a self employed person. This was not an accurate description of his employment circumstances either.[28] It is possible that from time to time the Ministry may fail to record income. We do not accept however that the appellant could have contacted the Ministry on at least 25 occasions as his submission suggests, and that on 25 occasions Ministry staff failed to record information about income. Theappellant's claim is simply unbelievable and his failure to provide anyevidence of a probative value supporting his claim such as the telephone number from which the calls were made supports our finding in this regard.[19] That is a factual finding which the Authority was able to make, on the evidence before it. This appeal is on a question of law only. It is not possible tochallenge that factual finding. The appellant takes issue with the Authority's findingthat he had failed to act correctly in his dealings with Work and Income New Zealand (WINZ). Because it is not the function of this Court, on this appeal, to examine the factual basis for that finding, it is not appropriate to comment on it.[20] The appellant also asserts that records of phone conversations he had with the Department have been destroyed in accordance with a policy which has not previously been disclosed to him, and that he has been misled over the availability of the evidence. That assertion is denied by the respondent. It is not necessary orappropriate to examine the Department's policy, or what the appellant was told. Theonly issue for this Court is whether the evidence to which the Authority referred was evidence on which it could base its conclusions. I find that it was.[21] The questions to question 3 is "yes"[22] I have answered the questions as follows:(a) Question 1 – yes.(b) Question 2 – no.(c) Question 3 – yes.[23] It follows that the appeal must be dismissed._________________________A D MacKenzie J