Barnbrook and Maidment (Child support)

[2022] AATA 5130

Barnbrook and Maidment (Child support) [2022] AATA 5130 (15 November 2022)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2022/BC024655

APPLICANT:  Mr Barnbrook

OTHER PARTIES:  Child Support Registrar

Ms Maidment

TRIBUNAL:Member P Jensen

DECISION DATE:  15 November 2022

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – child support agreement – whether child support calculated correctly pursuant to binding child support agreement – decision under review affirmed

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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

1. Mr Barnbrook and Ms Maidment are the parents of [Child 1]. They entered into a binding child support agreement (“the BCSA”) in September 2021. A child support case was registered with the Child Support Agency (“the CSA”) in October 2021. In June 2022 the CSA decided to register the BCSA. It required Mr Barnbrook to pay $844.00 per month in child support, and that monthly rate:

   … shall be increased on 1 July each calendar year according to the Consumer Price Index relevant to the March quarter for Brisbane, Queensland as published by the Australian Bureau of Statistics, commencing on 1 July 2022. …

2. There is no dispute that the Brisbane consumer price index rose by 2.2% from the December 2021 quarter to the March 2022 quarter and it rose by 6.0% from the March 2021 quarter to the March 2022 quarter.  On 18 June 2022 the CSA decided to increase Mr Barnbrook’s rate of child support payable from 1 July 2022 by 6.0%. It calculated that $844.00 per month x 1.06 = $894.64 per month, which it rounded up to $895 per month. Mr Barnbrook objected to that decision. His objection was disallowed. He applied to the Tribunal for further review. I heard the matter on 15 November 2022. Mr Barnbrook gave sworn evidence via an MS Teams audio link. Ms Maidment did not participate in the hearing.

3. In response to my questions, Mr Barnbrook acknowledged that his rate of child support payable could not be increased “according to the Consumer Price Index relevant to the March quarter for Brisbane” which, for the March 2020 quarter, was 125.3. The BCSA required a comparison of the Brisbane consumer price index for the March 2022 quarter and some other quarter. Mr Barnbrook effectively submitted that the other quarter was the Brisbane consumer price index for the December 2021 quarter.

4. Mr Barnbrook obtained a letter from the solicitors who represented him at the mediation which resulted in the BCSA.[1] The letter is dated 5 September 2022. It is addressed to the Binding Child Support Agreement Department of the CSA. The relevant paragraph states:

   Our client instructs us that [the CSA] has recently assessed that his periodic payments increase in accordance with the National CPI. We confirm that this does not reflect the agreement reached between the parties at Mediation.

   [1]See generally “Constructing undertakings and court orders”, Mr [A], (2008) 82 ALJ 82.

5. I noted that the BCSA does not provide for “an increase in accordance with the National CPI”; it provides for an increase in accordance with the Brisbane consumer price index. Mr Barnbrook stated that the paragraph is incorrect as he did not give those instructions to his solicitors. He added that he did not obtain an amended letter because his solicitors had charged $3,000 for the letter dated 5 September 2022 and he did not want to incur a similar fee for another letter.

6. Mr Barnbrook also provided his handwritten notes from the mediation. They include the following:

   Annual Increases subject to CPI

   * Brisbane CPI Quarterly Index to be used to increase payments

   * Stand alone CPI Calculations for MARCH QUARTER only

   Not National CPI or Annualised

   (Approx 2 | 3 % per annum based on Calculation)

7. Mr Barnbrook explained that “Approx 2 | 3 %” meant approximately 2% to 3%, which had typically been the historical annual increase in the consumer price index. He stated that recent changes in the consumer price index, such as the annual 6% increase to the March 2022 quarter, were “anomalies”. That line in Mr Barnbrook’s notes supports the view that the parents agreed that his rate of child support payable would be increased by the annual increase in the Brisbane consumer price index from one March quarter to the next, although other lines in Mr Barnbrook’s notes support the contrary view.

8. In response to my questions, Mr Barnbrook also gave the following evidence. He said that during the mediation he had tried to be “very fair”. He said he had believed that his rate of child support payable “should go up on a fair basis year on year”, and there needed to be some indexing “to keep its real value”.

9. I suggested that annually increasing his rate of child support payable by the annual increase in the Brisbane consumer price index would result in his initial rate of child support payable keeping its real value. At this point, Mr Barnbrook stated he was not qualified to engage in technical discussions about the consumer price index. At the start of the hearing, he had volunteered that he had a “significant understanding” of the consumer price index. He added that annual increases in the consumer price index do not fairly reflect the annual increases in prices generally. He said it allows for “runaway escalation”. He did not provide any evidence in support of that statement which is contrary to the definition of consumer price index. For example, the Australian Bureau of Statistics states on its website: “The Consumer Price Index (CPI) measures household inflation and includes statistics about price change for categories of house expenditure.”

10. Mr Barnbrook correctly noted that the ultimate issue is not whether the rate of child support payable pursuant to the BCSA is fair, but whether it has been calculated pursuant to the terms of the BCSA. However, if Mr Barnbrook’s interpretation of the BCSA were correct, it would result in him effectively paying less child support each year because the numerical increase in his child support payable would be outweighed by the reduction in the purchasing power of his child support. It would be unusual, but not impermissible, for parents to reach such an agreement. If Mr Barnbrook and Ms Maidment had reached such an agreement, one would expect the relevant provision of the BCSA to be drafted with greater precision to reflect that unusual arrangement. Further, one would expect Mr Barnbrook’s solicitors to refer to that unusual arrangement in their letter dated 5 September 2022. In the absence of persuasive evidence that the parents reached such an unusual arrangement, the obvious inference is that they agreed on annual increases in Mr Barnbrook’s rate of child support payable every 1 July, based on the annual increase in the Brisbane consumer price index to the preceding March quarter. I find accordingly. The CSA correctly interpreted the BCSA.

11. Finally, section 156 of the Child Support (Assessment) Act 1989 provides for the rounding of amounts. The CSA correctly rounded up Mr Barnbrook’s rate of child support payable to $895 per month.

DECISION

The decision under review is affirmed