Archer and Archer and Anor (SSAT Appeal)
[2013] FCCA 226
•9 May 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| ARCHER & ARCHER & ANOR (SSAT APPEAL) | [2013] FCCA 226 |
| Catchwords: CHILD SUPPORT – Appeal from SSAT – credibility of witness – financial resources – whether decision demonstrates error of law. |
| Legislation: Child Support (Assessment) Act 1989, ss.4, 98S(1)(g), 117(4)(g), 117(7A) |
| Cases cited: Whitford & Seyler (SSAT Appeal) [2008] FMCAfam 849 |
| Applicant: | MR ARCHER |
| First Respondent: | MS ARCHER |
| Second Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | HBC 717 of 2012 |
| Judgment of: | Judge Baker |
| Hearing date: | 5 March 2013 |
| Date of Last Submission: | 5 March 2013 |
| Delivered at: | Hobart |
| Delivered on: | 9 May 2013 |
REPRESENTATION
| The Applicant in person: | Mr Archer |
| The First Respondent in person: | Ms Archer |
| Counsel for the Second Respondent: | Mr Sparkes |
| Solicitors for the Respondents: | Australian Government Solicitor |
ORDERS
The Notice of Appeal (Child Support) filed 12 September 2012 be dismissed.
IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of Judge Baker delivered this day will for all publication and reporting purposes be referred to as Archer & Archer & Anor (SSAT Appeal).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT HOBART |
HBC 717 of 2012
| MR ARCHER |
Applicant
And
| MS ARCHER |
First Respondent
| CHILD SUPPORT REGISTRAR |
Second Respondent
REASONS FOR JUDGMENT
This is an appeal by Mr Archer (“the appellant”) from a decision of the Social Security Appeals Tribunal (“the Tribunal or SSAT”). The first and second respondents were respectively, Ms Archer (“the first respondent”) and the Child Support Registrar (“the Registrar”).
On 8 August 2012, the Tribunal set aside a decision of the Registrar. It substituted its own decision ("the Decision") that there be a departure from the administrative assessment of child support, such that for the period 22 July 2010 to 31 January 2014 the adjusted taxable income of the appellant be set at $36,000.00 per annum, pursuant to s.98S(1)(g) of the Child Support (Assessment) Act 1989 ("the Assessment Act").
In the Notice of Appeal (Child Support) filed 12 September 2012, the appellant sought that the Decision be set aside.
Background
The following background of the appellant and the first respondent, and the history of the child support payable by the appellant to the first respondent, is taken from the Reasons for Decision.
The appellant and the first respondent are the parents of Samuel born 22 June 1996, Georgia born 26 November 1998, and Jacob born 13 September 2000. They are in the sole care of the first respondent.
The assessment that applied for the child support period 1 September 2009 to 31 August 2010 required the appellant to pay child support of $356.00 per annum (the minimum annual rate).
On 22 July 2010, the first respondent applied to the Registrar seeking a departure from the administrative assessment of child support. She made this on the basis that:
·the costs of maintaining the children were significantly affected due to extra expenses incurred in meeting the children's special needs;
·it cost extra to care for, educate or train the children in the way the parents intended; and
·the assessment of child support was unjust and inequitable due to the appellant’s income, property, and financial resources or earning capacity (referred to as reasons two, three and eight respectively).
From 1 September 2010 a new child support period commenced and until 30 November 2011, the appellant was assessed as liable to pay child support of $360 per annum (the minimum annual rate) based on a 2009/10 taxable income of $17,676.00 and the first respondent’s taxable income of $54, 984.00.
On 30 September 2010, the senior case officer decided that there should be no departure from the administrative assessment in relation to the first respondent's application made on 22 July 2010. On 19 April 2011, the first respondent lodged an objection to this decision. She was given an extension of time in which to lodge her objection. The objection was subsequently disallowed but the decision was reviewed and “nullified by error,” which meant that the objection had to be reconsidered.
On 18 July 2011 an assessment was issued for the child support period 1 August 2011 to 31 October 2012, with the sum of $370.00 payable by the appellant.
On 14 February 2012, the first respondent’s objection of 19 April 2011 was allowed and the annual rate of child support payable by the appellant for the period 1 February 2012 to 31 January 2014 was set at $5,200.00.
The objections officer allowed the objection on the basis that the first respondent was incurring extra costs for the needs of the children, and therefore reason two was established. The officer concluded that the parents did not share a mutual intention for all three children to attend private schools, and therefore reason three was not established. The officer decided that the assessment of $370.00 per annum was unfair, as the appellant had recently received the benefit of “a significant financial resource,” being an inheritance from the estate of his father of $160,000.00, and therefore reason eight was established.
On 22 February 2012, the appellant applied to the Tribunal for a review of this decision. The Tribunal heard the application on 29 June 2012. The appellant was represented by a solicitor and gave sworn evidence to the Tribunal. The first respondent also gave sworn evidence.
On 29 June 2012, the Tribunal deferred determination of the application and issued further directions for the appellant to provide additional evidence.
On 8 August 2012, the Tribunal reconvened, without further attendance by the parties, to consider the additional evidence and determine the application.
The Reasons for Decision
As a preliminary matter, the Tribunal referred to an earlier decision made on 31 March 2009 by a tribunal differently constituted, which found that the parents intended for the children to attend private school. The Tribunal referred to the first respondent’s application for a departure determination on 22 July 2010, when she sought to establish a ground for departure on the basis of the children’s school fees and the appellant’s earning capacity. The Tribunal relied on Re Cooper and Repatriation Commission[1] and Comcare Australia v Grimes & Anor[2] and decided that it would not allow the issues determined by the tribunal on 31 March 2009 to be re-agitated. The Tribunal adopted the view of the previous tribunal that the parents mutually intended for the children to be educated privately, and that the costs of $3,850.00 per annum, or less, for the education of the children was not sufficient to significantly affect the costs of maintaining the children.
[1] (1995) 35 ALD 164.
[2] (1994) 33 ALD 548
The Tribunal then set out the legislative framework. It referred to Part 6A of the Assessment Act (ss.98B and 98C). It found that there were grounds to depart from the administrative assessment provided for in S.117(2)(b)(ii) and s.117(2)(c)(ia) of the Assessment Act.
The first ground was that the costs of maintaining the children are significantly affected because the children are being cared for, educated or trained in the manner that was expected of the parents. The Tribunal found that the private education costs of the children of $5,792.98 in respect of the 2010 school year, significantly affected the costs of maintaining the children. This cost was significantly more than the costs of $3,850.00 determined by the earlier tribunal as not giving rise to a ground for departure. It was more than the costs incurred by the first respondent for the 2011 and 2012 years. The Tribunal found that this distinguished the 2010 school year from other years.
The second ground was that the administrative assessment of child support payable by the appellant results in an unjust and inequitable level of financial support because of the financial resources of the appellant.
The Tribunal found that the appellant received the sums of $157,106.70 and $4,105.77 from the estate of his father in November 2009, a total sum of $161,212.00. The Tribunal said that the neither the appellant’s Counsel nor the appellant disputed that an inheritance could be classed as a financial resource. The Tribunal continued to class it as a financial resource, and said that the appellant made no complaint about that classification.
The appellant argued that the amount of the inheritance was modest and therefore did not give rise to “special circumstances.” The Tribunal rejected that argument. The Tribunal considered an annual child support liability of $370.00 per annum was unjust and inequitable when the appellant has a financial resource of $161,212.00.
The Tribunal then had regard to the matters set out in s.117(4) of the Assessment Act. When considering the income, property and financial resources of each parent, the Tribunal formed a view that the appellant was evasive when faced with its enquiries about his income property and financial resources.
The Tribunal referred to a party’s positive duty to be open about their financial circumstances. The Tribunal said:
One clear inference the tribunal will draw from Mr Archer’s reluctance to provide the evidence he be directed to provide is that the tribunal’s view is that the funds Mr Archer received from his father’s estate have not been spent. Therefore the tribunal concluded that Mr Archer has a financial resource of $161,212.00.[3].
[3] SSAT decision Archer & Archer (August 2012), at 70.
The Tribunal noted that it was not impossible to arrive at an obligation to pay periodic child support having regard to a capital sum. The Tribunal quoted from Whitford and Seyler[4] as follows:
As noted by Lindsay FM… Now, there are obvious logical and practical difficulties in using a capital sum to create an obligation to pay a periodic amount of child support. How long is the capital going to be available? Is it appropriate to denude a capital sum over an extended period of time to meet an obligation usually met from income? Why would the child support income be fixed at one level for one year and not another? It is because of such issues and others besides that, presumably, such a course of action is not frequently encountered.[5]
[4] (SSAT Appeal) [2008] FMCAfam 849.
[5] Ibid at 34.
The Tribunal had regard to what Halligan FM, as he then was, noted in Cazet & Faulkner & Anor (SSAT Appeal)[6]:
It may be that actual or imputed income from capital assets is included in arriving at a parent’s proper income figure on which to base the calculation of periodic child support. It may be that the level of capital assets compared to the actual or imputed income from them, together with any other income, is such that the calculation of a proper level of child support that ensures “that children have their proper needs met from reasonable and adequate shares in income, earning capacity, property and financial resources of both of their parents” requires that the capital directly influence the quantification of the amount of child support.[7]
[6] [2011] FMCAfam 1157.
[7] Ibid at 35.
The Tribunal was of the view that the sum of $161,212.00 cautiously invested, could derive the appellant with an ongoing source of income, regard to which could be had to determine his child support liability. The Tribunal used the deeming provisions of the Social Security Act1991 to find that that the appellant ought to generate an income of $6,700.00 per annum from the inheritance.
The Tribunal found that the appellant’s total financial resources amounted to a sum of $36,010 per annum, including the sum of $6,700.00 which the Tribunal inferred that the appellant could earn from investment of the inheritance.
The Tribunal considered the proposed departure determination and had regard to s.98S of the Assessment Act and the types of determination that can be made. It decided to use the date when the first respondent applied for a departure, being 22 July 2010, as the commencement of any proposed departure determination. The Tribunal was of the view that given the level of dispute between the parties, certainty was desirable and a determination that applied to 31 January 2014 was appropriate.
The Tribunal was of the view that an appropriate departure determination would be to set the appellant’s adjustable taxable income at an amount equivalent to what it found his financial resources to be, namely $36,000.00. The Tribunal was aware that due to indexation of payments the appellant receives, his financial resources would be slightly less than $36,000.00 in past years, but slightly more in future years. The Tribunal thought that a determination that used $36,000.00 for the entirety of the period was appropriate and would reflect the average of his financial resource for the entire period.
In respect of the ground for departure in respect of the school fees for the 2010 school year, the Tribunal did not increase the child support liability by a further amount for those school fees. It noted that the period for which this ground arose has past and concluded that its determination should be sufficient to ameliorate the school fee costs incurred by the first respondent in 2010.
The Tribunal estimated that the effect of the proposed departure determination was that the rates of child support would be approximately:
·22 June 2010 to 31 August 2010 $5,000.00 per annum.
·1 September 2010 to 31 July 2011 $4,700.00 per annum.
·1 August 2011 to 31 October 2012 $4,400.00 per annum.
The Tribunal then balanced the financial detriment to the parents and the children when it considered hardship, which the proposed departure determination may cause pursuant to s.117(4)(g) of the Assessment Act.
The Tribunal acknowledged that its determination will result in the appellant having to meet substantial arrears, which could potentially be viewed as hardship to him.
The Tribunal was satisfied that the appellant has sufficient capital resources and an excess of financial resources above the costs of his own self support and the ongoing child support liability, to address any arrears.
The Tribunal concluded that it was just and equitable as regards the children, the appellant and first respondent, and otherwise proper to depart from the administrative assessment of child support.
Relevant law
Section 110B of the Child Support (Registration and Collection) Act 1988 (Cth) (“the Registration and Collection Act”) provides that a party may only appeal from a decision of the SSAT on a question of law. It is not a rehearing on the merits in which findings of facts made by the SSAT are reviewed and the court’s view of the facts substituted.
Counsel for the Registrar relied on Comcare v Moon[8], in which the Federal Court of Australia considered the role of courts undertaking administrative review of tribunals such as the SSAT, and the need for caution when assessing whether or not the tribunal has made an erroneous finding of fact capable of being an error of law. Mansfield J held:
…Care must be taken not to convert questions of fact into questions of law. The Tribunal, moreover, does not commit an error of law merely because it finds facts wrongly or upon a doubtful basis, or because it adopts unsound reasoning: Minister for Immigration & Multicultural Affairs v Rajalingam (1999) 93 FCR 220 at 257; Willcocks v Comcare [2001] FCA 1315 at [6]. If there is any evidence rationally and legally capable of supporting a finding of fact, then the finding of fact does not involve an error of law. That is so even if there is a significant body of evidence pointing to a contrary finding of fact. And the decision as to what evidence is to be accepted is a matter for the administrative decision maker and not for the Court. It is not the function of the Court on an application such as the present to review the Tribunal's findings of fact and to substitute its view of the facts for those of the Tribunal.[9]
[8] [2003] FCA 569, cited in Frost & Frost & Anor (SSAT Appeal) [2011] FMCAfam 1311 at 82.
[9] Ibid at 33.
Counsel for the Registrar also relied on decisions of this Court such as Tasman & Tisdall[10], and LDME & JMA (SSAT Appeal)[11] in which the approach to be taken in appeals from the SSAT was considered. In Tasman and Tisdall[12] Brown FM (as he then was) identified the circumstances in which an administrative tribunal such as the SSAT may be found to have made an error of law. They are if it:
[10] [2008] FMCAfam 126.
[11] [2007] FMCAfam 712.
[12] [2008] FMCAfam 126.
i) fails to construe properly the legislative provisions applicable;
ii) identifies the wrong issues or asks itself the wrong questions;
iii) ignores relevant material or relies on irrelevant material;
iv) fails to accord procedural fairness to the party before it;
v) makes an erroneous finding of such a magnitude that it goes to the very jurisdiction which it purports to exercise rendering its decision perverse or unreasonable or otherwise offending logic…[13]
[13] Ibid at 44.
The approach to be taken in an appeal pursuant to s.110B of the Registration and Collection Act is not a rehearing on the merits, in which findings of facts made by the SSAT are reviewed and the Court’s view of the facts substituted.
Consideration
Before the Court was the Reasons for Decision and the documents provided to the Court pursuant to s.110K of the Registration and Collection Act.
The appellant relied upon the Notice of Appeal, an affidavit filed 5 November 2012, a document “Additional Argument- Appellant” and a letter dated 20 July 2012 from Australia and New Zealand Banking Corporation (“the ANZ Bank”) to the appellant. The letter had been provided to the Tribunal.
The Registrar relied upon an Outline of Argument.
In the Outline of Argument, the Registrar objected to the appellant’s affidavit being received in evidence, although Counsel did not press the objection.
Section.110G of the Registration and Collection Act provides that the court can make findings of fact if they are not inconsistent with the findings of fact made by the SSAT (other than findings made by the SSAT as the result of an error of law), and if it is convenient for the court to make such findings of fact, having regard to the matters set out in s.110G (1) (b). For the purpose of making such findings of fact the court may have regard to the evidence given in the proceedings before the SSAT, and receive further evidence. The power of the court to receive further evidence is dependent on the court finding an error of law in the decision of the SSAT.
The appellant’s affidavit contained repetition of the history of the matter, general complaints about the Decision and irrelevant information. As will become apparent from these Reasons, I find that there has not been an error of law. Save for the appellant’s reasons for the appeal in the affidavit, which were in effect submissions in support of the grounds of appeal, I consider that the balance of the affidavit should not be received into evidence.
The appellant and the first respondent were self-represented and made submissions. Counsel for the Registrar made submissions.
The Grounds of Appeal
Grounds one and two
These grounds are essentially the same and read:
No evidence that Appellant’s inheritance still in existence.
No evidence upon which the Tribunal was entitled to infer that the Appellant’s inheritance was still in existence.
The issue is whether there was evidence before the Tribunal to enable it to draw an inference that the inheritance funds have not been spent and to make a finding that the appellant has “a financial resource” of $161,212.00.
The Tribunal described the inheritance fund as “a financial resource” until it considered hardship under s.117(4)(g), when it described the inheritance as “capital resources.”
The term “financial resources” is not defined in the Assessment Act. In the context of property decisions, inherited assets, such as real property or cash funds have been held to be property and not a resource.[14] The Full Court of the Family Court has interpreted the term “financial resources” as meaning something more than what is covered by the terms income and property. For example, contingent interests or benefits, which a party actually received or was likely to receive, whether legally entitled thereto or not.[15] The Full Court referred to Bailey and Bailey,[16] using the example of benefits received under the terms of a discretionary trust, and to Tiley and Tiley,[17] referring to resources of a family company, as financial resources.
[14] Bonnici & Bonnici (1992) FLC 92-272, Burke & Burke (1993) FLC 92-356.
[15] Kelly & Kelly (1981) FLC 91-108, at 9.
[16] (1978) FLC 90-424 at 77.
[17] (1980) FLC 90-898.
Whilst the inheritance was described as a financial resource, the Tribunal treated it as capital or property, when it said “that such an amount, cautiously invested, could derive Mr Archer an ongoing source of income, regard to which could be had to determine his child support liability.” [18]
[18] SSAT decision Archer & Archer (August 2012), at 71.
The appellant asserted that there was no evidence of interest earned by him as a result of investment of the funds by him, and accordingly the Tribunal made an error in finding that he has the funds. The Tribunal used the deeming provisions of the Social Security Act 1991 to find the amount of income which the appellant should generate from the inheritance. The Tribunal had regard to the appellant’s capacity to derive income from assets which do not produce, but are capable of producing income pursuant to s.117(7A) of the Assessment Act.
This provides:
(7A) In having regard to the income, property and financial resources of a parent of the child, the court must:
(a) have regard to the capacity of the parent to derive income, including any assets of, under the control of, or held for the benefit of, the parent that do not produce, but are capable of producing, income; and…
Before the Tribunal there was evidence provided by the appellant that he received the sums of $157,106.70 and $4,105.77 from the estate of his father in November 2009, a total amount of $161,212.47. The basis for the inference drawn by the Tribunal that the appellant has not spent the funds, was his failure to produce evidence to demonstrate that.
The question whether there is any evidence of a fact is a question of law. The question whether an inference can be drawn from facts found is a question of law. The making of findings and the drawing of inferences in the absence of evidence is an error of law. In Australian Broadcasting Tribunal v Bond[19] Mason CJ said:
…so long as there is some basis for an inference – in other words, the particular inference is reasonably open – even if that inference appears to have been drawn as a result of illogical reasoning, there is no place for judicial review because no error of law has taken place.[20]
[19] (1990) 170 CLR 321.
[20] Ibid at 356.
I accept the submission of Counsel for the Registrar that to demonstrate an error of law, the appellant would need to show that there was no evidence before the Tribunal for it to make the finding and draw the inference.
On 2 July 2012 the Tribunal made extensive directions requiring the appellant to provide evidence to the Tribunal by the close of business on 23 July 2012. This included “statements of all bank accounts... running balances and continuity of transactions for the period 1 July 2009 to date…”
Specifically the Tribunal directed that the appellant provide;
·Statements for the bank account into which Mr Archer's inheritance cheque of $157,106.70 was deposited. The documents must disclose:
· The name(s) of account-holders;
· All transactions; and
· Running balances and continuity of transactions for the period 1 July 2009 to date, or if the account is now closed, to the date of closure of the account.
The appellant submitted that the letter to him from the ANZ Bank dated 20 July 2012, which was in evidence before the Tribunal, indicated that the ANZ Bank could not locate the relevant accounts.
The letter indicated that, from the details the appellant provided to the Bank, the accounts in his name could not be located. He was told that if he provided the BSB and account number, the Bank would be happy to put through another request for him.
The Tribunal found that the appellant had not provided the evidence requested and required by it.
The Tribunal had before it the decision of the objections officer dated 14 February 2012, which is the decision the appellant asked the Tribunal to review. It is helpful to set out part of that decision which reads,
Mr Archer submits that he received an inheritance in the amount of $160,000 but this is non-taxable and therefore cannot be considered as income. He submits that the cash inheritance barely covered his ongoing living expenses and bills accumulated since separation. Mr Archer was not forthcoming with details of his inheritance to SCO H and during the objection process has provided some information, although not supported by bank statements, which he claims to be the case because he no longer banks with the relevant financial institution. He advises that the $160,000 inheritance has been used as follows:
$4,000 on Legal fees – SSAT– Debt.
$35,000 on a car.
$30,000 on land.
$7,500 on credit card debt.
$3,500 on HBC debt.
$25,000 on furniture.
$4,350 on rent for 3 months.
$15,000 on a wedding.
$30,000 on a honeymoon.
$7,500 on legal fees for a personal matter.
$14,000 for legal fees for a debt.
$4,500 to pay for his father's funeral.
$2,500 for a family visit
$4,500 for a wedding in South Australia.
$2,500 for a family visit.
Mr Archer advises this left arrears of $29,850 which were covered by the sale of land for $30,000.
The appellant was given the opportunity by the Tribunal to demonstrate that he had expended the inheritance. He did not produce evidence to demonstrate whether or how he had done so.
The Tribunal formed a negative view about the appellant’s credibility. It formed a view that the appellant was “evasive” when faced with its enquiries about his income, property and financial resources. I consider that this finding was open to the Tribunal.
The Tribunal said, “it is well established that a party to proceedings before this tribunal has a positive duty to open about their financial circumstances[21].” The Tribunal referred to Humphries & Berry (SSAT Appeal)[22], said as follows,
the tribunal had difficulty forming a clear view of Mr Archer’s past and current financial position. Information he was a directed to provide was not forthcoming. For example, many bank statements requested for particular periods have not been provided. Mr Archer argues that the inheritance he received from his father has been all spent, but when directed to provide evidence of that expenditure, which Mr B at hearing volunteered he provide, Mr Archer failed to provide the information required.[23]
[21] SSAT decision Archer & Archer (August 2012), at 68.
[22] [2008] FMCAfam 409.
[23] SSAT decision Archer & Archer (August 2012), at 69.
The Tribunal made an inference that the funds which the appellant received from his father's estate had not been spent, in the context of the appellant’s failure to fully and frankly disclose documents which related to his assertion of the expenditure of his inheritance.
The appellant has a duty to make full and frank disclosure before the Tribunal. In Gilmour and Gilmour[24] the Full Court of the Family Court made it clear that there is a duty to make full disclosure under child support legislation in the same way as such a duty applies in financial proceedings under the Family Law Act1975.
[24] (1995) FLC 92-591.
In respect of the duty of disclosure, the Full Court of the Family Court in Weir & Weir[25] said:
It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour’s findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature.[26]
[25] (1993) FLC 92-338.
[26] Ibid at 5.
In Chang v Su[27], the Full Court of the Family Court summarised the law to be applied and the approach to be adopted in cases, where through a lack of full and frank disclosure, the Court is unable to fully ascertain the extent of a party’s wealth. The Full Court referred to Black & Kellner[28] and referred to what Chief Justice Nicholson said in dismissing the appeal:
As Senior Counsel for the wife pointed out, the first step in proceedings for a property settlement is for the court to ascertain the wealth of the parties and in this regard it is of interest to note the remarks of the Full Court in the case of Giunti and Giunti (1986) FLC 91-759, particularly at 75,555 where the court commented:
It is obviously desirable as a general principle that the court should first of all identify the pool of assets available and evaluate it. If each party complies with his or her obligation to make a full and substantive disclosure of their financial affairs – see Briese and Briese (1986) FLC 91-713, affirmed by the Full Court in Oriolo and Oriolo (1985) FLC 91-653, there is no problem, although there may be disputes as to valuation.
However if, as here, one party fails to fulfil that obligation, is it open to that party then to rely on the absence of satisfactory evidence to prevent the making of an order against him or her which otherwise justice and equity would require? It would be simple, if that were the case, to evade the jurisdiction of this court, not by outright refusal which would attract sanctions but by obfuscation and evasion.[29]
[27] (2002) FLC 93-117.
[28] (1992) FLC 92-287.
[29] Ibid at 69.
Halligan FM, as he then was, pointed out in Agrippa & Horton (SSAT Appeal)[30] that if the Tribunal is satisfied that a party has made a deliberate non-disclosure of his or her financial circumstances, it should be reasonably robust in assessing the non-disclosing parent’s financial circumstances adversely to that parent and in favour of the other parent. This was the position held by the Full Court of the Family Court in Chang v Su.[31]
[30] (2010) FMCAfam 1144 at 24 -25.
[31] Op cit.
I do not accept the appellant’s submission that the Tribunal should have subpoenaed the ANZ Bank because it had subpoenaed the Bendigo Bank. The Tribunal has power to obtain information from a person and has the power to require the Registrar to obtain information.[32] The Tribunal had directed the appellant to provide the documentation on 2 July 2012. It was his obligation under direction from the Tribunal to make a full disclosure to assist the Tribunal to make its determination. He was aware that the inheritance expenditure was an issue, as it had been in the previous objection hearings.
[32] s.103K and s.103 L Child Support (Registration and Collection) Act 1988 (Cth).
The Tribunal was satisfied on the evidence before it that the appellant did not make full and frank disclosure. As I have said, the Tribunal was entitled to make a finding about the appellant’s credibility. I consider that the inference made by the Tribunal was reasonably open to it, based on the appellant’s failure to provide evidence of the expenditure of the inheritance and his failure to produce bank statements. I consider that the Tribunal did not make an error of law.
The appellant also asserted that the Tribunal erred by “declaring that the inheritance was a significant amount.” The appellant argued before the Tribunal that it was a modest amount and it could not give rise to special circumstances.
The Tribunal rejected that argument. It considered the amount of the appellant’s child support liability and said that the inheritance was equivalent to almost eight years worth of the self support amount used under the statutory formula. It found that the disparity between the inheritance amount and his child support liability is so great that special circumstances arise. The Tribunal identified what amounts to “special circumstances” and referred to Gyselman & Gyselman[33]. In Gyselman & Gyselman[34] the Full Court referring to the term “special circumstances” said:
Whilst it is not possible to define with precision the meaning of that term, as a generality it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the Legislature is that the Court will not interfere with the administrative formula result in the ordinary run of cases…[35]
[33] (1992) FLC 92-279.
[34] Ibid.
[35] Ibid at 29.
It was open to the Tribunal to make a finding of fact that the inheritance was significant. The finding was not illogical or irrational so as to amount to an error of law.[36]
[36] Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611 at 130.
I consider that it is not arguable that the amount of the inheritance in these circumstances does not give rise to “special circumstances.”
The Tribunal did not fall into error. These grounds are not made out.
Ground three
This ground reads:
As a consequence of 1&/or 2 there was no evidence entitling the Tribunal to find that the Appellant had sufficient capital resources such that the imposition of the obligation on the Appellant to pay arrears of child support did not constitute hardship.
I have found that grounds one and two have not been made out and the Tribunal did not make an error of law when it found that the appellant has the benefit of his inheritance funds.
When considering the “hardship that would be caused to Mr Archer, Mrs Archer and the children (Paragraph 117(4)(g) of the Act),” the Tribunal balanced the financial detriment to the parents and the children and found that it was just and equitable to depart from the administrative assessment.
The Tribunal found that the appellant received the inheritance funds in 2009 and he ought to have been able to generate income of $6,700.00 per annum from investment of the funds. The Tribunal found that the average of the appellant’s total financial resources was $36,000.00 per annum for the entirety of the period for the proposed departure determination. The Tribunal found that the necessary costs to support the appellant amounted to $28,808.00 per annum.
There was evidence before the Tribunal of the parties’ financial circumstances, including their Statements of Financial Circumstances.
The Tribunal acknowledged that the requirement for the appellant to meet the arrears could potentially be viewed as hardship to him.
The Tribunal said as follows:
The tribunal acknowledged that the determination being considered will result in Mr Archer having to meet substantial child support arrears. This could potentially be viewed as hardship to Mr Archer. However, the tribunal was satisfied that Mr Archer has sufficient capital resources (it considers that he still has the $161, 212 from the estate of his father) and an excess of financial resources over and above the costs of his own self support, and the ongoing child support liability being contemplated, to address any arrears that may arise.[37]
[37] Ibid.
The Tribunal made findings about the first respondent’s income as $48,228.00 (from September 2009), $54,984.00 (from 1 September 2010) and $73,761.00 (from 1 August 2011.) It found that the costs of her self support were $33,696.00 per annum, leaving her with between $14,532.00 and $40,065.00 per annum to meet the proper needs of the children amounting to $47,364.00, plus the costs of educating them. The Tribunal found that hardship will result to the first respondent and the children if the departure determination is not made.
There was evidence before the Tribunal to enable it to find that it was just and equitable to depart from the administrative assessment.
This ground is not made out.
Grounds Four and Five
These grounds are related and read:
Appeal the decision to the inclusion of [omitted] disability pension as a non taxable form of income that was included for the first occasion. This pension is to compensate for the injuries and trauma suffered during a [omitted] career spanning 20 years. Injuries covering from hearing loss to pain in the knee and back areas and Post Traumatic Stress Disorder (PTSD).
Appeal the decision in the inclusion of the appellants [omitted] income as it is classed as a hobby and is not full time but seasonal and depends on the amount of games attended.
Under the heading “Income, property and financial resources of each parent: Paragraph 117(4)(d) of the Act”, the Tribunal determined that the appellant’s “financial resources” amounted to a total amount of $36,010.00, which included the annual income the appellant could earn from investment of the inheritance funds. It found as follows:
Inheritance $6, 700 per annum
Centrelink payment $4, 330 per annum
[omitted] payment $3, 678 per annum
[omitted] pension $19, 036 per annum
[omitted] $2, 266 per annum
Total financial resources $36, 010 per annum[38]
[38] SSAT decision Archer & Archer (August 2012), at 80.
The appellant asserted that the Tribunal wrongly interpreted the meaning of “financial resources” by including his [omitted] pension and his income from his hobby of [omitted] in that phrase. This was because both these payments are not considered as part of his adjusted taxable income for the purposes of an administrative assessment of his child support liability. He asserted that these sums should, therefore not be considered as financial resources.
The Tribunal detailed the sources of the appellant’s income and noted that many of the amounts are not taxable or considered as being part of the appellant’s adjustable taxable income for the administrative assessment of child support. It referred to Mee & Ferguson[39], a decision of the Full Court of the Family Court and its interpretation of the meaning of “financial resources,” as follows:
The term “financial resources” has been the subject of interpretation in a number of cases in this court and has been given a wide meaning. Reference need only be made in this respect to Kelly’s case (No.2) [1981] FLC 91-108 especially at 76, 802-3. It is treated as being: “A source of financial support which a party can reasonably expect would be available to him or her to supply a financial need or deficiency.[40]
[39] (1986) FLC 91-716.
[40] Ibid at 6.
As I have said, the term “financial resources” is not defined in the Assessment Act. The principal object of the Assessment Act as set out in s.4 is:
to ensure that children receive a proper level of financial support from their parents” and “that the level of financial support to be provided for their children is determined according to their capacity to provide financial support...
Having regard to these objects,I consider that the Tribunal was not in error when it applied a wide meaning of the phrase, as referred to in Mee & Ferguson.[41]
[41] Op cit.
I consider that it was reasonably open to the Tribunal to include the appellant’s [omitted] payments and his [omitted] pension within the phrase “financial resources.”
The appellant also asserted that because the [omitted] payments vary depending on the number of [omitted], they should not be included as a financial resource. I agree with the submission of Counsel for the Registrar that the appellant was seeking to establish that the inclusion of these payments was therefore not reasonable.
The Tribunal considered the total sum earned by the appellant for [omitted] during a 13½ month period and commuted that sum to an annual sum. I consider that the inclusion of the [omitted] payments as a financial resource was not so unreasonable as to amount to an error of law.[42]
[42] Mee & Ferguson (1986) FLC 91-716, at 6.
I consider that this ground is not made out.
For the above reasons, I am not persuaded that the Decision should be set aside. I consider that the Appeal should be dismissed.
I certify that the preceding ninety-eight (98) paragraphs are a true copy of the reasons for judgment of Judge Baker
Associate:
Date: 9 May 2013
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