ATANASOVSKI V THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT HC AK CIV 2006-404-002423

ATANASOVSKI V THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT HC AK CIV 2006-404-002423 18 August 2006IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2006-404-002423IN THE MATTER OF an appeal by way of case stated from determination of the Social Security Appeal Authority at Auckland under section 12Q of the Social Security Act 1964 BETWEEN VASIL ATANASOVSKI Appellant AND THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT Respondent Hearing: 14 August 2006 Appearances: Appellant in Person Ms A J Williams/Mr G A J Stanish Judgment: 18 August 2006JUDGMENT OF VENNING J7KLV MXGJPHQW ZDV GHOLYHUHG E\ PH RQ  $XJXVW  DW SPSXUVXDQW WR 5XOH    RI WKH +LJK&RXUW5XOHV 5HJLVWUDU'HSXW\5HJLVWUDU 'DWH«««««Solicitors: Crown Law Office, Wellington Copy to: V AtanasovskiIntroduction[1] This is an appeal by way of case stated from a decision of the Social Security Appeal Authority dated 23 June 2004. [2] In that decision the Authority dismissed the appellant's appeal in respect of the following decisions made by the Chief Executive and upheld by a Benefits Review Committee:• A decision to decline an application for special needs grant of $120 for food on 1 July 2003.• A decision to decline an application for an advance payment of benefit of $125 for outstanding medical costs on 11 August 2003.• A decision to decline an application for a special needs grant of $140 for food on 11 August 2003. [3] The Authority dismissed the appeal in relation to the applications for special needs grant. The Authority noted the Chief Executive had paid the account to which the request for an advance related. It was no longer a live issue before the Authority. [4] The case stated for this Court is whether as a matter of law:Was the decision of the Authority that there were no exceptional circumstances in favour of the appellant being granted a special needs grant for food on 1 July 2003 and 11 August 2003 unreasonable?Background[5] I take the background from the case stated on appeal taking into account a number of written comments the appellant has made on a draft of the case stated.[6] The appellant is a married man now aged 61 years. At the time of the decisions under review the appellant received a married rate of sickness benefit, a special benefit and a disability allowance. [7] I record that it is the appellant's case that the fact the benefits were split between his wife and himself supported his application for the special needs grants. That splitting came about in the following way. [8] In May 2003 the appellant advised the Ministry that his wife had moved to Dunedin on a temporary basis. At that time all benefit payments were being paid into a joint account. On 4 June 2003 the appellant's wife changed the bank account into which her share of the benefit was to be deposited. The Ministry then split the benefit payments equally between the appellant and his wife. The appellant contacted Work and Income New Zealand to register his concern that his wife was receiving her portion of the benefit into her own bank account. The appellant stated that he and his wife were not separated. [9] I interpolate that during the course of submissions the appellant advised the Court that his wife had gone to Dunedin to support their daughter who was studying at university and had a young child. The appellant's wife provided care for the grandchild. I understood from the appellant that his wife may have returned now that the daughter's course of study has been completed. [10] While the appellant and his wife were living apart (although not separated in a legal sense) as the appellant was only receiving one half of the benefits, he applied for a special needs grant for food of $120 on 1 July 2003. His application was declined on the basis he had exhausted his 52 week entitlement to a special needs grant and there were no exceptional circumstances. [11] On 11 August 2003 the appellant made another application for a special needs grant for food of $140. Again the application was declined on the basis that the appellant had exhausted his 52 week entitlement to a special needs grant for food and there were no exceptional circumstances. The appellant sought to review both decisions.[12] I again interpolate that during the course of addressing the Court the appellant made it clear that he had been declined a special needs grant on a number of other occasions as well. That certainly seems to be the case from the supplementary report prepared under s 12K(4)(e) of the Social Security Act 1964 for the Social Security Appeal Authority. The Ministry's records indicated the appellant was declined a special needs grant for food on a total of nine occasions at least between 1 July 2003 and 1 October 2003. Prior to that, and between 13 May 2003 and 23 June 2003 he had received six special needs grants for food totalling $350. He had also received a special needs grant for doctor's fees and prescription on 26 June 2003. Between July 2003 and December 2003 the appellant received additional advances of his benefit for car maintenance, power and glasses. [13] At the material time, with the benefits the appellant was receiving split between him and his wife he received on a regular basis, a base figure of $178.10. Of that $84 was deducted for rent and $80 was paid by way of automatic payment on a loan. Again I interpolate that during the course of submissions the appellant presented to the Court a copy of an automatic payment authority for $90 a week but that is at odds with the banking records the appellant produced to this Court which showed the two weekly automatic payments of $80 and $84 that were referred to by the Authority. [14] The decisions to refuse the special needs grant on 1 July and 11 August were reviewed by Ministry staff and by the Benefits Review Committee. The Benefit Reviews Committee upheld the decisions of the Chief Executive. The appeal to the Authority followed. This case stated follows the determination of the Authority.Appellant's case[15] The appellant represented himself at the hearing of this appeal. The appellant initially suggested there was some form of conspiracy against him by employees of the Department of Social Welfare and some Court officials. There is no basis for that suggestion. It appears the appellant was not advised that the first case management conference scheduled for 28 February 2006 was vacated and the file transferred to Auckland. It seems that the appellant travelled to Wellington for theconference. That is unfortunate, but neither that nor any of the other actions the appellant referred to supports his submission of corruption. The submission does him no credit at all. [16] The appellant also made a number of general submissions. He argued that the decision of the Authority and the earlier decisions of the Chief Executive and Review Committee were wrong and were based on incorrect information. Next he said exceptional circumstances existed because he needed the special needs grants to pay for his substantial medical expenses and for food. He submitted that the Authority minimised the circumstances of his plight. He rejected the Authority's reasoning that he intended to apply the special needs grant for purposes other than food. He submitted the decision was wrong. [17] The main gravamen of the appellant's complaint seems to be the fact that the benefits had been split between himself and his wife, particularly the fact the special benefit and disability allowance had been split.The principles to applyOn an appeal by way of case stated the Authority's decision must stand unless the Court is satisfied that, in exercising its discretion, it either applied the wrong legal test or erred in its application of the law to the facts. It is not open to this Court to reconsider the facts under the guise of an error of law. To amount to an error of law the facts must be such that, no person, acting judicially and properly instructed as to the law, could have come to the determination reached on the facts If there are reasonable grounds for a finding of fact, the Court is not to be called upon for a "second opinion":Edwards v Bairstow [1955] 3 All ER 48. Recently applied in Chhima v Chief Executive of the Department of Work and Income New Zealand (HC Wellington, CIV 2004-48501761, 24 February 2006, Frater J para [75].The legislative framework[18] The Social Security Act 1964 makes provision for three tiers of benefits. The first tier is made up of basic benefits such as the unemployment, sickness, invalids and widows benefits. In the second tier are benefits designed to deal with specificneeds, namely, the accommodation supplement and the disability allowance. The third tier includes special benefits under s 61G of the Act as well as other discretionary payments: per Chief Executive of the Department of Work and Income New Zealand v Bruce (CA33/05, 16 March 2006) para [10]. [19] The Social Security Act 1964 s 124 (1)(d) recognises the Minister has power to approve welfare programmes. The relevant special needs grant programme was established and approved by the Minister on 18 December 1998. The particularly relevant provisions are Part 3, cl 11.2:11.2.1 Eligibility for Food GrantThe chief executive may make a Grant to purchase food if – (a) the Applicant or his or her Immediate Family had an immediate need to purchase food; and (b) the Applicant and his or her spouse (if any) have no resources to meet that need, and would otherwise have to rely on a food bank to meet that need; and (c) that need, or the lack of resources to meet it, was caused by an essential expense that had to be met and which left insufficient money to buy food.11.2.2 Number and amounts of Food GrantsThe chief executive may make more than 1 Food Grant in a 52 Week Period, but unless the chief executive considers there are exceptional circumstances, the chief executive must not make Grants under clause 11.2.1 during a 52 Week Period that exceed in total – (a) $200 for an unmarried person with no dependent children; (b) $300 for a married couple with no dependent children; (c) $450 for a married couple or a sole parent with 1 or 2 dependent children; (d) $550 for a married couple or a sole parent with 3 or more dependent children. (emphasis added)[20] The programme does not define exceptional circumstances. [21] The principles to apply on an application are set out at cl 5:In considering any application for a grant under any of Parts 3, 4, 5, or 6— (a) the chief executive must consider— (i) the applicant's ability to meet the need from his or her own resources; and (ii) the assistance that is or might be available to the applicant from other sources to meet the need; and (b) the chief executive may consider the extent to which the applicant has caused or contributed to the immediate need or to the situation that has given rise to the immediate need.[22] An earlier programme (but not different in any material respect) was considered by McGechan J in Hall v Director-General of Social Welfare [1997] NZFLR 902. In that case McGechan J held:Special needs grants for food are available in the Director-General's discretion both to cover "one off" situations and to meet an ongoing pattern of need up to the financial limit provided (or beyond that limit if the Director-General considers exceptional circumstances exist), but in case of ongoing pattern of need a special benefit under s 61G generally will be the more appropriate solution. In such cases of ongoing pattern of need the Director-General will consider which course is to be taken, but generally will be justified in declining special needs grants and opting for special benefits under s 61G.[23] Earlier, McGechan J had discussed the phrase "exceptional circumstances" and said:Not too much weight should be placed upon the "exceptional circumstances" qualification. This is directed at the truly "exceptional". It is a strong word. It excludes the run of the mill. However tempting, it is not to be reinterpreted so as to subvert the provision's principal thrust. Regrettably, it is not exceptional in modern New Zealand to be hungry and to be without funds to buy sufficient food. Ask any food bank. They exist because they are needed. Recurrent lack of food and lack of resources does not, per se, qualify as "exceptional".[24] The phrase "exceptional circumstances" has also more recently been considered by Gendall J in Rowan v Chief Executive of the Department of Work and Income (HC Wellington, CIV 2003-485-1672, 5 July 2004):Exceptional circumstances go beyond special or unusual circumstances and denote a rare occasion or event. The purpose of the Act, whilst not specified, is nevertheless clear; that it is to alleviate hardship but not necessarily to relieve or remove it in its entirety. Deficiency of income in relation to expenditure does not of itself become a special circumstance unless, in termsof the Ministerial Direction (which need only be a matter for consideration and is not binding) the expenses of [the appellant] are extraordinary and [his] entitlements have been exhausted.[25] Given the appellant appears on his own behalf I have reviewed the background papers in this matter in some detail. That review satisfies me that the Authority properly considered all relevant material before coming to its conclusion that the appellant had failed to make out exceptional circumstances in this case. The Authority also applied the appropriate legal tests to the applicant's position. Moreover, I am satisfied the Authority was right in its ultimate conclusions. [26] The appellant's difficult financial position has been brought about for a number of reasons. First, the decision of the appellant and his wife that she would live for a time in Dunedin to assist their daughter with childcare whilst the daughter was studying, thereby effectively requiring the appellant and his wife to run two households. [27] Next, the appellant's lack of ability to manage his finances. During the course of submissions the appellant suggested to the Court that he had borrowed $9,000 off a car dealer because he had a very good relationship with that car dealer, that relationship apparently being based on the fact that when he first came to New Zealand the appellant had bought three cars from the car dealer, one each for himself, his wife and his daughter. All three cars were apparently bought on hire purchase. I note in passing that the appellant also said he had spent some $200,000 in resettling himself and his family in New Zealand. There is no evidence of where or how that money was applied. The appellant lives in a rented Housing Corporation house. [28] Further, as noted by the Authority, another cause of concern is the appellant's willingness to borrow to pay off fines and other expenses associated with maintaining his car. As the Authority observed, it is surprising the appellant would seek to maintain and run a car when he does not have money for food. The appellant also seems to have had no hesitation in entering hire purchase arrangements on the basis that, in his words, it only required payments of $12 a week. That shows a lack of understanding as to whether it was necessary for him to buy the particular items inthe first place, whatever the weekly hire purchase commitment might be. Next, a major drain on the appellant's income was the $80 per week automatic authority to the car dealer, an obligation that he incurred to maintain his car and pay Court fines. [29] Essentially the problem for the appellant is that his expenses were greater than his weekly benefit payments because he had accumulated debts over and above his rent and the benefits were split between the appellant and his wife. The fact that his weekly commitments nearly exceeded that portion of the benefit paid to him is not "extraordinary circumstances" per Stemson v Director-General of Social Welfare (No 2) (HC Auckland, AP22-SW00, 28 June 2000, Gendall J) at para [9], particularly given that the reasons given for incurring the $80 per week automatic payment. [30] The appellant emphasised his need for assistance with medical costs. But such needs arising out of his medical condition are recognised by the special disability allowance and the higher level of special benefit paid to him. As noted by counsel for the respondent, the appellant was receiving a supplementary special benefit at a higher manual rate of $85.50 per week. [31] The real issue is the effect on the appellant of the benefits being split between his wife and himself, including the special disability benefit. That splitting was authorised by s 83 of the Social Security Act 1964. The Authority did accept that the full amount of the appellant's disability allowance should have been paid directly to him rather than half of it being paid to his wife. However, on the issue of exceptional circumstances, the Authority noted that given the appellant and his wife were not separated for legal purposes, and chose to run two households, the appellant's wife should have been in a position to assist him. The Authority considered the appellant and his wife should have resolved the matter between themselves as the full benefits were made available to them. The resources of the appellant and his wife, including that portion of the benefits paid to her were properly taken into account by the Authority when considering the appellant's "family resources".[32] As the Authority concluded, the appellant's circumstances were not exceptional and did not justify payments outside the term of the Ministerial directive.Result[33] In summary I accept the submission for the respondent that the decision was reasonable in the context and purposes of the Act. It contained no error of law. The question posed for this Court must be answered no and the appeal dismissed.Costs[34] The respondent does not seek costs. In the circumstances I make no order for costs. __________________________ Venning J