Babu and Kapfer (Child support)

[2018] AATA 3988

Babu and Kapfer (Child support) [2018] AATA 3988 (22 August 2018)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/AC014144

APPLICANT:  Mr Babu

OTHER PARTIES:  Ms Kapfer

Child Support Registrar

TRIBUNAL:  Member S Cullimore

DECISION DATE:  22 August 2018

DECISION:

The decision under review is set aside and a new decision substituted that the previous care determination that Mr Babu’s care percentage is 46% and Ms Kapfer’s care percentage is 54% is to remain in place.

CATCHWORDS
Child support - Percentage of care - Temporary disruption to the likely pattern of care - Existing care percentage determination should not be revoked - Decision under review set aside and substituted

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.

REASONS FOR DECISION

BACKGROUND

1. The following information is taken from the records of the Department of Human Services – Child Support (the CSA) and is not in dispute, and the Administrative Appeals Tribunal (the Tribunal) finds each matter as fact.

2. Mr Babu and Ms Kapfer are the parents of [Child 1] who is now 14 and [Child 2] who is now 10.

3. On 3 January 2018 a delegate decided to change the care percentages to 0% to Mr Babu and 100% to Ms Kapfer from 4 November 2017.

4. Mr Babu lodged an objection on 15 January 2018.

5. On 12 May 2018 an objections officer partly allowed the objection and changed the care percentages to 24% to Mr Babu and 76% to Ms Kapfer from 4 November 2017.

6. On 22 May 2018 Mr Babu sought a further review by this Tribunal.

DOCUMENTARY EVIDENCE AND HEARING

1. The Tribunal had before it a bundle of documents provided by the CSA. This bundle is referred to in this decision as C1 to C95.

2. Mr Babu provided some further documents, which were marked A1 to A9.

3. He attended the hearing on 2 August 2018 via teleconference and gave evidence and made verbal submissions.

4. Ms Kapfer was made a party to this review but she did not attend the hearing on 2 August 2018.

5. The Tribunal therefore deferred the matter and invited her to make written submissions by 16 August 2018.

6. No submissions were received from her by the due date and the Tribunal made this decision on 22 August 2018.

ISSUES

13.The principal issues to be decided by the Tribunal in a case such as this are (1) whether the original decision made on 3 January 2018 was the correct and preferable decision in all of the circumstances, and, (2) if not, what is the correct and preferable decision?

CONSIDERATION

The relevant child support law

14.The law relevant to this review is contained in the Child Support (Assessment) Act 1989 (the Assessment Act).

15.The CSA makes determinations of each parent’s percentage of care in accordance with sections 49 to 54L of the Assessment Act.

16.The legislative scheme requires a new care percentage determination to be made following notification to Child Support of a change of the care arrangements.

17.Under section 54F if the Registrar is notified that the actual care arrangements do not correspond with the existing care percentages, and if changing the care percentages would produce a change in the person’s ‘cost percentage’, then the Registrar must make a new care determination.

18.Any new care determination takes effect from the date that care changed or, if the Registrar is not notified within 28 days of care changing, then the date of the notification: subsection 54F(2).

19.Where there are no legally binding arrangements between the parties regarding care, the original decision maker is required by section 50 of the Assessment Act to assess the actual or likely pattern of care of the children, by reference to an appropriate period from which a pattern can be deduced (this is called ‘the care period’), and then determine whether to revoke the existing care determination and make a new one.

20.Specific provisions apply where there is contravention of ‘care arrangements’ or where care is reduced below regular care (ie below 14% care).[1]

[1] See below.

21.Not all changes of care should automatically be reflected in a child support assessment.

22.The Child Support Guide, the CSA’s online policy and legislation resource (the Guide), relevantly states as follows on the issues of what constitutes a change of care which should be reflected in the child support assessment:

2.2.2 Care Determinations & Changes in Care

…..

The Registrar will usually determine a percentage of care based on the actual care that each parent or carer has of the child. …..

When the Registrar is notified or otherwise becomes aware that the care for a child has changed, the previous determination will be revoked. A new care determination will be made according to the circumstances. ….

Change in pattern of care

When considering a change in care, the Registrar will consider the reason for the request for a new care calculation. If there has been a change to the pattern of care, the Registrar will need to identify the event that is relevant. The event may be used to determine the commencement (i.e. date of effect) of the care period (2.2.1). The Registrar will need to determine the percentage of care that is likely to occur in the care period. Not all changes will result in the calculation of a different care percentage.

….

What constitutes a change to the pattern of care will depend upon the individual circumstances of the case. For example, when considering a change that would result in a parent's care falling below 14%, after a pattern of at least 14% had been previously established, the Registrar will consider that the pattern of care has changed when:

·     the parent misses 3 care events in a row,

·     the parent misses 5 events of care out of 8, or

·     the parent misses 20% of the care over 12 months (when calculating 20% the Registrar will not include an isolated event that is clearly not a change in the pattern).

….

The Registrar will consider the date the care changed to be the date of the earliest event that is used to demonstrate that the pattern of care has ceased - for example, the date of the first missed event when a parent misses 3 care events in a row.

….

One-off block of 100% care

Where a parent or carer unexpectedly and temporarily provides 100% care of a child, the Registrar may recognise that the person has 100% care although they are not expected to continue to have that level of care. In these situations, the Registrar will determine the care over a short care period related to the unexpected circumstance (subsections 49(1)(a) and 50(1)(a)). When care returns to the normal pattern, either carer may request a new care percentage determination.

The period of unexpected care will generally need to be at least 4 weeks in length in order for the Registrar to make such a determination. However, shorter periods can be considered, especially where there is a possibility the period may be extended.

23.Importantly, the Tribunal’s role in care percentages cases is that it may only review the legal correctness of the original care decision, based on what evidence was available to the original decision maker, as supplemented by any further relevant material supplied to the objections officer, and of course any further relevant information supplied to the Tribunal itself.

24.Since 2010, both the Assessment Act and the relevant family assistance legislation have been amended to ‘harmonise’ the use of care percentages for FTB and child support purposes.

25.The current rules are neatly summarised in the Guide at chapter 2.2.5, as follows (emphasis added):

2.2.5 Alignment of Care between Child Support & FTB

Context

…..

From 1 July 2010, a single care determination is made, by either a delegate of the Child Support Registrar or the Secretary (responsible for FTB), where there is a child recognised in a child support assessment and a person receives FTB for the same child, and the single care determination applies for child support purposes and for FTB purposes.

….

Where care determinations for child support and FTB are aligned for a child, parents and carers need to inform either the Registrar or the Secretary of any changes in care.

…

If a person applies for an administrative assessment of child support and the Registrar has not already determined the percentage of care for that child but the care percentage for that child has already been determined by the Secretary for FTB purposes, the Registrar will use the same care percentage as the Secretary. If the care arrangements have changed since the Secretary made the determination, the person may seek a new determination from either the Registrar or the Secretary. If a new care percentage is determined as a result, that new care percentage will be used by both the Registrar and the Secretary.

……

Objections & reviews of decisions

The same principles apply to objection decisions, and reviews of decisions by the AAT (CSA Act section 54L and FAAct section 35U). Where either the Registrar or the Secretary conducts an internal review of a care decision …. any new decision made on review will be used by both the Registrar and the Secretary. Where the AAT amends a decision or substitutes a new decision about a care percentage, that amended or substituted decision will be used by both the Registrar and the Secretary.

……

26.  Certain payers of child support in receipt of income support payments are liable only for the minimum annual rate of child support, now $424 pa (the MAR).[2]

27.  Mr Babu is currently paying nil child support as the MAR does not now apply to him, as he has more than 14% care of the children.

28.  The outcome of this review may therefore not affect his child support liability at all, as he will pay no child support if his care percentage is above 14%, whatever figure it is, but this review has to be determined because, as set out above, the findings of the Tribunal as to the correct care percentages is to be applied to both child support and FTB.

[2] Section 66 of the Assessment Act.

The relevant facts

29.The Tribunal has considered the documentary evidence and the verbal evidence and finds the following further facts:

·The child support case was registered on 7 January 2009;

·Court Orders were made regarding care of the children on 10 August 2012;

·Those Orders provided for Mr Babu to have five nights care per fortnight in school term time plus 50% of the school holidays, which came to 62% care to Ms Kapfer and 38% care to Mr Babu;

·Before it made the decision under review, the CSA was using care percentages for [another child] of 54% of care to Ms Kapfer and 46% care to Mr Babu. These percentages of care had been in place since 16 April 2016;[3]

[3] C5.

·On 5 November 2017, Ms Kapfer notified the CSA that there had been a change in the care to 100% care to her of both children from 4 November 2017;[4]

[4] C12.

·The CSA file records that they were unable to contact Mr Babu regarding this notification;

·On 3 January 2018 a delegate decided to change the care percentages to 0% to Mr Babu and 100% to Ms Kapfer from 4 November 2017;

·This decision resulted in Mr Babu paying the MAR and also the cancellation by Centrelink of payment to him of FTB, for the payment of which a person needs to have at least 35% care of a child;

·Mr Babu lodged an objection;

·On 22 January 2018 Ms Kapfer told the objections officer that care would be one night per week for Mr Babu in term time and half of the school holidays, which was 23%;

·On 8 March 2018 Mr Babu told the objections officer that he had care of the children on a week on/week off basis;

·The objection decision was made on 12 May 2018;

·Because his care percentage was increased to above 14% (namely to 26%), this decision reduced Mr Babu’s child support liability to nil from 4 November 2017;

·A new care determination was made on 3 July 2018 fixing the care percentages as 56% to Ms Kapfer and 44% to Mr Babu.

DISCUSSION OF EVIDENCE, CONCLUSIONS AND REASONING

Does section 51 or 52 apply?

30.The Tribunal must determine exactly which provisions of the Assessment Act should be applied in the circumstances.

31.The Tribunal first considered sections 51 and 52.

32.These provisions (broadly speaking) allow for two care determinations to be made, one to apply on an interim basis, in some circumstances, where one party has acted in contravention of court orders, and the other party takes action to enforce those orders, or to obtain new orders. One care determination is based on the care percentages determined by the court orders themselves, the other is based on what actual care is happening.

33.The evidence of Mr Babu was that the August 2012 Orders have never been followed by the parties. He stated that he had in fact had sole care of the children in 2014 and 2015. Then, the level of care provided by Ms Kapfer had steadily increased until in 2016 they had effectively agreed 50/50, week on/week off care.

34.In view of this history, the Tribunal is satisfied that this matter should not be treated as a case of an ongoing contravention of those Orders, and therefore these provisions do not apply.

Below regular care: section 54G

35.The Tribunal notes that the original decision reduced Mr Babu’s level of care to below regular care, ie to 0%.

36.Section 54G requires that (among other things) the current care determination must be revoked where (in this case) Mr Babu ‘had no care of the [children] or had a pattern of care that is less than regular care …’ of the children despite Ms Kapfer ‘making them available’ for care by Mr Babu.

37.Mr Babu stated in evidence that he had been sharing accommodation with Ms Kapfer and the children for some three months before November 2017, when they had a disagreement and he had left, and moved in with a friend. His evidence was that the previous pattern of roughly equal shared care had resurrected immediately after or very shortly after he had moved out.

38.The Tribunal accepts the evidence of Mr Babu and in the absence of any contradictory evidence by Ms Kapfer finds that his version of events is probably correct.

39.It follows then that section 54G does not apply as there is no issue of Mr Babu failing to have care of the children despite them being ‘made available’ for his care by Ms Kapfer

Actual care: section 50

40.The Tribunal has therefore concluded that it has to determine this matter in accordance with what actual care was occurring between the parties as at the date of notification of the care change and whether there should be any finding of a new pattern of care existing or emerging in November 2017.

41.In that regard, the Tribunal has taken into account both the relevant legislation and the contents of the Guide as set out above on what changes in circumstances constitute a change in care.

42.The Tribunal notes and accepts the evidence of Mr Babu generally, and specifically that a new care determination was made recently by the CSA which provides for almost equal shared care.

43.That fact is in itself significant and it is also noteworthy that the original decision maker had no information at all from Mr Babu before making the care change.

44.The Tribunal then considered the evidence as presented by the parties to the objections officer and as supplemented by the witness statements provided to the Tribunal (A1 to A9).

45.The Tribunal finds that the evidence of Mr Babu and his various witnesses, namely that he has consistently had roughly equal shared care of the children since at least April 2016, is more credible than Ms Kapfer’s statements to the CSA.

46.The Tribunal has concluded that there was no new pattern of care in existence or even emerging, as at the date of the original decision, 3 January 2018.

47.Taking the evidence as a whole, it seems likely to the Tribunal that there was — at most — only a very temporary hiatus or interruption to the underlying care arrangements in November 2017. In essence, nothing has really changed between the parties over care issues since at least April 2016, and the parties have consistently continued to have roughly equal shared care of both children.

48.In these circumstances, the Tribunal has concluded that the legally correct outcome is that the decision of the objections officer simply be set aside.

49.This has the effect that the previous care determination (ie 54% care to Ms Kapfer and 46% to Mr Babu) should have continued to apply until it was replaced by the new care determination made on 3 July 2018.

DECISION

The decision under review is set aside and a new decision substituted that the previous care determination that Mr Babu’s care percentage is 46% and Ms Kapfer’s care percentage is 54% is to remain in place.