Journal article

Disclosable, but not necessarily fatal? Welfare overpayments in the uncertain landscape of fitness for practice

Welfare recipients Fraud Legal services Australia

Recently, media reports and a Senate Inquiry raised the issue of widespread errors by Centrelink in sending out 'debt recovery’ letters to recipients of social security benefits alleging overpayments. Even in the absence of automated systems, overpayments arise under a wide range of circumstances in relation to welfare benefits accessed by students either before or during the course of study, ranging from administrative errors by Centrelink to calculated fraud by the recipient. Most overpayments exist against a background of financial hardship or troubled personal circumstances.

Admission to the legal profession universally involves some form of assessment of character by reference to a range of terminologies ('fit and proper’, 'moral character’, 'good character’) which are intrinsically ill-defined, unamenable to precise 'semantic exegesis’. This very imprecision renders them as legal artefacts of indeterminate scope, and able to be arbitrarily deployed, possessing as they do 'the widest scope for judgment and indeed for rejection’ of an application for admission.

The mere existence of a welfare benefits overpayment carries the potential for an adverse character assessment during the application process which may render the applicant unsuitable for admission, or subject them to a period 'in the wilderness’ while they demonstrate rehabilitation. As such, overpayments are among the incidents which are required to be disclosed. Yet the treatment of welfare overpayments is arguably piecemeal, with the approaches of admitting authorities unpredictable due to the range of circumstances under which the overpayments might occur, and the lack of any clear principles (other than the vague propositions regarding character) against which suitability for admission is measured. There is, moreover, a dearth of judicial or academic writing regarding the principles which apply in determining fitness in the face of welfare irregularities, in stark contrast to the wealth of material addressing academic misconduct - an issue of similar scope and seriousness.

This article seeks to redress the lack of consideration of welfare matters in the context of admission. Part II addresses the obligations of disclosure imposed on applicants for admission to the legal profession, including the inconsistent guidance which is provided to applicants as to what is disclosable. Part III considers the lack of clear and objective definitions of the core concepts relating to character and misconceptions about fundamental assumptions relating to 'character’ as a static concept, and the potential ineffectiveness of past conduct as a predictor of future conduct. Part IV examines underlying issues of the frequency and causes of welfare overpayments based on the available data for Australia. Part V considers prosecutorial issues flowing from overpayments, including the mental elements incorporated into relevant offences, and Part VI examines the limited case law available, concluding that a conviction for welfare fraud is neither a necessary nor a sufficient condition, in itself, for a refusal to admit an applicant. While the diverse range of circumstances under which welfare irregularities might arise is such that no clear formula can be framed, the character test will continue as a necessary part of the admission process, and welfare irregularities will remain a disclosable issue in admission proceedings, although they need not prove fatal.

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