Arnold and Waghorn (Child support)

[2017] AATA 2966

Arnold and Waghorn (Child support) [2017] AATA 2966 (5 June 2017)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2017/AC011543

APPLICANT:  Mr Arnold

OTHER PARTIES:  Child Support Registrar

Ms Waghorn

TRIBUNAL:Deputy President J Walsh

DECISION DATE:   5 June 2017

CATCHWORDS

Child support – Non-agency payment – No reasonable prospect of success – Application for review dismissed under paragraph 42B(1)(b)

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

DISMISSAL OF APPLICATION FOR REVIEW:

1. In this matter, Mr Arnold seeks review of a decision dated 12 April 2017 disallowing an objection to a decision dated 31 January 2017 which refused his application for $47,000 to be credited towards his child support liability as a non-agency payment (NAP). The subject sum was distributed to Ms Waghorn in the context of resolution, by consent order, of Mr Arnold and Ms Waghorn’s property proceedings in 2012. The basis of the objection decision was that the monies distributed to Ms Waghorn were not a transfer by Mr Arnold to her (but rather a distribution flowing from the division of the parents’ matrimonial property) and there was no mutual intention that the funds were to be in lieu of child support.

2. Mr Arnold’s application to the Tribunal was made on 26 April 2017. The matter was referred to me to consider whether it might be appropriate to dismiss this application under paragraph 42B(1)(b) of the Administrative Appeals Tribunal Act 1975. Mindful that such a course ought not be lightly taken, I convened a telephone directions hearing on 19 May 2017 in order to clarify some of the submissions made on Mr Arnold’s behalf and to ensure I properly comprehended his case. I then gave Mr Arnold and [Mr A] (a self-styled “legal practitioner”) two weeks to provide any further written submissions they wished to be considered. Nothing further has been received.

3. Having carefully considered the submissions for Mr Arnold and the other material before the Tribunal, I have decided to dismiss this application on the basis it has no reasonable prospect of success.  My reasons can be briefly stated.

Consideration

1. The parents’ property matters were resolved by way of a consent order dated 27 January 2012. The sum of $32,853 in trust account funds was to be paid to Mr Arnold. The sum of $47,000 held in another trust account was to be paid to Ms Waghorn. Further orders dealt with the remaining property assets.

2. In November 2016, [Mr A], on Mr Arnold’s behalf, sent the CSA a copy of the 2012 consent orders together with various written submissions. Ultimately, this communication was treated as an application to have the consent orders registered as a child support agreement. By decision dated 22 November 2016, that application was refused. There is no evidence that Mr Arnold objected to this decision.

3. Instead, he later applied to have the subject sum of $47,000 credited as a NAP. This application was refused and Mr Arnold’s subsequent objection was disallowed. 

4. At the directions hearing, [Mr A] confirmed that Mr Arnold relied on section 71B of the Child Support (Registration and Collection) Act 1988 as authorising or requiring Mr Arnold’s entitlement to have the $47,000 sum credited as a NAP. Sections 71 and 71B of the Act provide:

71  Direct payments to payee

(1)  Subject to section 71D, if:

(a)  the payee of an enforceable maintenance liability receives from the payer an amount intended by both the payer and the payee to be paid in complete or partial satisfaction of an amount payable under the liability in relation to the child support enforcement period; and

(b)  the payer or the payee applies to the Registrar to have the amount received by the payee treated as having been paid to the Registrar;

the Registrar shall, in spite of section 30, credit the amount received by the payee against the amount payable under the enforceable maintenance liability.

(2)  An application must be made in the manner specified by the Registrar.

Note:          Section 16A provides for the Registrar to specify the manner in which an application may be made.

(3)  This section does not apply to an enforceable maintenance liability of a kind referred to in paragraph 18A(3)(a).

…

71B  Payments not in money

(1)  For the purposes of sections 71 and 71A, if both the payer and the payee of an enforceable maintenance liability so intend:

(a)  a payment in a form, other than money, by the payer; or

(b)  a transfer of any property or right by the payer;

is taken to be an amount paid in complete or partial satisfaction of an amount payable under an enforceable maintenance liability.

(2)  For the purpose of determining the amount to be credited under section 71 or 71A, in relation to the payment or transfer, against the amount payable under the liability of the payer to the Commonwealth, the amount of the payment or transfer is taken to be:

(a)  the amount agreed by the payer and the payee; or

(b)  if no amount is agreed, the amount determined by the Registrar.

1. Section 71 is concerned with payments of money whereas section 71B relates to payments other than in money form. It seems clear enough the payment Mr Arnold relies on here was a payment of money. Be that as it may, both sections have as a critical element that the subject payment (or transfer) be intended by both the liable parent and the parent entitled to receive child support to be in lieu of child support. Putting aside for the moment whether the subject $47,000 can be properly said to have been either paid or transferred by Mr Arnold to Ms Waghorn, there is simply no evidence upon which it is open to find Ms Waghorn intended these property settlement funds paid to her in 2012 should be regarded as child support. It follows that the $47,000 cannot be credited as a NAP.

2. Despite this apparently insurmountable hurdle, [Mr A’s] submission is that I should look at the “overall intent” of the Act to infer that the subject sum ought be credited. It seems to me that [Mr A’s] piecemeal written submissions rather miss the point that clear, specific provisions cannot be read down or accorded a fundamentally different meaning unless there are compelling reasons, based on accepted canons of statutory interpretation, which would require that course. No such reasons exist here.

10.  [Mr A] relies on the definition of child support in the Child Support (Assessment) Act 1989 which refers to financial support. His submission then is that the funds paid to Ms Waghorn from the property settlement proceeds equate to financial support and so, it is suggested, also constitute child support. The difficulty with this line of argument is that the definition of child support in section 5 of the Assessment Act refers to financial support under the Assessment Act. The consent orders in 2012 were made under the Family Law Act 1975, not the Assessment Act. There is no evidence whatsoever that the property settlement proceeds were intended to count in any way towards Mr Arnold’s child support liability. Even if that had been in contemplation, the technical requirements of section 69R of the Family Law Act would have had to have been met before the orders could have any effect for child support purposes. Here, they weren’t.

11.  Some reliance was also placed on section 69A of the Act, relating to the crediting of lump sum payments:

69A  Crediting of lump sum payments

(1)  This section applies if:

(a)  either:

(i)  a child support agreement accepted by the Registrar includes lump sum payment provisions in accordance with paragraph 84(1)(e) of the Assessment Act; or

(ii)  a court has made an order under section 123A of that Act in relation to the provision of child support in the form of a lump sum payment; and

(b)  the Registrar has been notified that the lump sum payment has been paid in accordance with the agreement or order.

Here, there is no evidence of any child support agreement which has been accepted by the Child Support Registrar, nor that the provisions of paragraph 84(1)(e) of the Assessment Act are satisfied. In addition, there is no evidence of any court order under section 123A of the Assessment Act relevant to Mr Arnold’s case. It follows that section 69A does not assist his position.

12.  The result is that the absence of mutual intent referred to in paragraph 8 above means that Mr Arnold’s case cannot succeed.   

Conclusion

13.  Amendments to the AAT Act made by the Tribunals Amalgamation Act 2015 broadened the scope of the Tribunal’s dismissal powers. Subsection 42B(1) relevantly provides:

(1) The Tribunal may dismiss an application for the review of a decision, at any stage of the proceeding, if the Tribunal is satisfied that the application:

(a) is frivolous, vexatious, misconceived or lacking in substance; or

(b) has no reasonable prospect of success; or

(c) is otherwise an abuse of the process of the Tribunal.

The Revised Explanatory Memorandum to the Tribunals Amalgamation Bill 2014 explained that these powers “would provide the Tribunal with greater power to dismiss unmeritorious matters early where appropriate.”

14.  The Tribunal’s statutory objective is, inter alia, to provide a mechanism of review that is fair, just, economical, informal and quick: see section 2A of the AAT Act.

15.  It is trite that the power to dismiss an application on the basis it has no reasonable prospect of success ought be sparingly invoked. In this case, after careful consideration, I have come to the view that Mr Arnold’s application has no substantive merit.

16. In the circumstances, and guided by the Tribunal’s statutory objective under section 2A of the AAT Act, I have decided that it is appropriate to exercise the power available under paragraph 42B(1)(b). Permitting proceedings that simply cannot succeed to continue would be inconsistent with notions of justice, fairness, economy and proportionality that the Tribunal must take into account. Accordingly, I dismiss Mr Arnold’s application.