Bartrop and Tatro (Child support)

Bartrop and Tatro (Child support) [2021] AATA 3844 (31 August 2021)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2021/SC021542
APPLICANT:  Mrs Bartrop
OTHER PARTIES:  Child Support Registrar
Mr Tatro

TRIBUNAL:Member M Douglas
DECISION DATE: 31 August 2021
DECISION:

The decision under review is set aside and the matter is sent back to the Child Support Registrar for reconsideration in accordance with the direction that a determination be made pursuant to subsection 65B(4) of the Child Support (Assessment) Act 1989 that section 65A of the Child Support (Assessment) Act 1989 not apply for the child support period commencing 1 September 2019 from such day within that period that will ensure that Mr Tatro will not have been overpaid child support from Mrs Bartrop.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – whether a fixed annual rate of child support should not apply – application for fixed annual rate not to apply should be accepted for specific period to avoid overpayment – decision under review set aside and sent back to Child Support Registrar

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

BACKGROUND

Mrs Bartrop is the parent assessed to pay child support to Mr Tatro for their daughter, [Child 1].
For the child support period commencing 1 September 2019 Services Australia – Child Support (which was known as the Department of Human Services as at 1 September 2019, and to which the Tribunal shall hereafter refer to as Services Australia) assessed that the annual rate of child support payable by Mrs Bartrop for [Child 1] was the rate specified pursuant to subsection 65A(2) of the Child Support (Assessment) Act1989 (the Act), being $1,443. Services Australia was required to make that assessment in accordance with subsection 65A(1) of the Act because Mrs Bartrop did not receive an income support payment during the previous financial year and her adjusted taxable income, as determined in accordance with section 43 of the Act, for the last financial year, was less than the single parenting payment.
Mrs Bartrop made an application under subsection 65B(1) of the Act for section 65A not to apply. Subsection 65B(4) of the Act provides Services Australia with a discretion to determine that section 65A not apply if a parent’s current income is less than the single parenting payment and if it would be unjust and inequitable to expect the parent to pay the amount of child support assessed under section 65A.
On 19 September 2019 Services Australia declined Mrs Bartrop’s application. It wrote to her on that date advising her that its reason for declining her application was “it is considered unjust and inequitable under the law for the fixed rate not to apply in your circumstances”.
On 12 February 2021, Mrs Bartrop objected to Services Australia’s decision of 19 September 2019. Her objection was well outside the time stipulated by subsection 81(1) of the Child Support (Registration and Collection) Act 1988 by which she was to make her objection. However, at the time of making her application she also applied for that time to be extended, which application Services Australia granted on 11 March 2021.
On 22 April 2021 Services Australia disallowed her objection. In the reasons Services Australia published for that decision it advised that whilst it was satisfied that Mrs Bartrop’s income is less than the single parenting payment it was not “satisfied that it would not be unjust and equitable for [Mrs Bartrop] to pay the FAR as she is has (sic) sufficient excess periodic gifts to contribute to the child’s expenses at the rate of $1,443 per annum”. The Tribunal observes that FAR is a synonym for fixed annual rate, which is the term that Services Australia has adopted to describe the rate at which child support is to be assessed pursuant to section 65A.
On 20 May 2021, Mrs Bartrop applied to the Tribunal for a review of Services Australia’s objection decision.
The Tribunal heard her application on 31 August 2021. She participated in the hearing which was conducted using the software application Microsoft Teams. She provided sworn oral evidence to the Tribunal. Mr Tatro also participated in the hearing but did not give any evidence or make any submissions. Mrs Bartrop also made an application at the hearing for her husband, Mr Bartrop, to make submissions on her behalf at the hearing. Mr Tatro did not oppose that. The Tribunal allowed Mrs Bartrop’s husband to do so.
The Tribunal notes that Services Australia did not participate in the hearing but it provided the Tribunal, in accordance with its obligation under subsection 37(1) of the Administrative Appeals Tribunal Act 1975, the documents it had that were relevant to its objection decision.

CONSIDERATION

Mrs Bartrop’s evidence was that she has not worked for numerous years and did not work during the child support period commencing 1 September 2019. She said that she is a wife and her role is as a housekeeper. She said that she and her husband have been trying to have a baby and her husband wanted her to stay at home and take care of their house. She said there was no physical reason that would prevent her from working but said that her husband’s preference was for her not to work so that she could rest and they could try to have a baby.
Mrs Bartrop said that her husband works full-time. Because of the income he earns, she does not qualify for any social security. She said that her husband pays for all their household expenditures. The arrangement is that she would use either her [credit card] to purchase items for their house or would transfer funds from a [Bank 1] account she has to the accounts of various providers of goods or services to pay for goods and services, and her husband would transfer sufficient monies from his account to her [credit card] or bank account to ensure she had sufficient funds to pay for the purchases of their household.
Mrs Bartrop does not have any investments or property.
Mrs Bartrop provided to Services Australia a copy of the statement the [Bank 1] issued to her for her account for the period 1 September 2019 to 29 November 2020. That revealed that the total payments she had received from her husband over that period amounted to $7,280. Mrs Bartrop also provided Services Australia with a copy of the statement the [Bank 1] had issued to her for her [credit card] covering the period 2 September 2019 to 26 October 2020. That revealed that she had debited that card to the extent of just under $5,000 in that period to meet various household expenditures. As said, her evidence is that her husband transferred monies to that [credit card] to clear Mrs Bartrop’s indebtedness to the bank from using that card.
The Tribunal is satisfied that the evidence demonstrates that Mrs Bartrop’s income during the relevant child support period was less than the single parenting payment.
The Tribunal is also satisfied that Mrs Bartrop did not have any financial resources or property upon which she could draw or that she could liquidate to provide financial support for [Child 1].
The Tribunal observes that an object of the Act is to ensure that the financial support parents provide for their children is determined according to the capacity of the parent to provide financial support. In terms of establishing whether Mrs Bartrop could have obtained employment so as to receive an income to enhance her capacity to provide financial support for [Child 1], Services Australia, and the Tribunal in its place, can only have regard to the income Mrs Bartrop had a capacity to earn if the three criteria specified in subsection 117(7B) of the Act are met. One criterion is that the parent has not demonstrated it was not a major purpose of the parent’s decision not to work to affect the administrative assessment of child support in relation to their child. In this case, the Tribunal is satisfied, based on Mrs Bartrop’s uncontested evidence, that her purpose in not working during the relevant child support period was to abide her husband’s wishes of being a housewife and taking care of the household duties and resting so that they could try to have a baby. In other words, because one of the criterion of subsection 117(7B) is not met in this case, the Tribunal cannot find that Mrs Bartrop had a capacity to earn any income from work in the relevant child support period.
In those circumstances the Tribunal considers that it would be unjust and inequitable to have expected Mrs Bartrop to pay the amount of child support as assessed by Services Australia in accordance with section 65A of the Act. Simply put, she did not have income, or a capacity to earn an income, or financial resources or property to pay child support at the rate assessed under that section.
Mrs Bartrop’s evidence was that her husband paid some of the child support she was assessed as liable to pay during the relevant child support period. Subsection 65B(5) of the Act stipulates that, with respect to any decision made that section 65A not apply, Services Australia has to specify a day within the child support period from which section 65A ceases to apply. The policy of Services Australia, as published in the Child Support Guide at 2.5.3, is that, if a consequence of a determination being made not to apply the fixed annual rate from the beginning of the child support period would be to create an overpayment for the payee, then “generally the Registrar will specify that the determination will apply from a date after the start of the child support period”. In other words, one matter that must be considered with respect to determining the date from which the fixed annual rate is not to apply, is the financial effect on the parent who has already received child support for their child.
Were a determination to be made that section 65A not apply from the start of the child support period commencing on 1 September 2019, then because Mrs Bartrop has partially met her child support obligation as assessed by means of her husband paying some of the child support, Mr Tatro would have been overpaid child support. Bearing that in mind, and noting the very late date on which Mrs Bartrop objected to Services Australia’s decision of 19 September 2019 to make a determination under section 65B, the Tribunal considers that whilst a determination ought to be made under subsection 65B(4) that section 65A not apply, the date specified from which section 65A should not apply should be a date after the commencement of the child support period such that Mr Tatro will not have been overpaid any child support from Mrs Bartrop.
The Tribunal is unable to work out what that date should be from the evidence before it. Accordingly, the Tribunal considers that the decision to be made in this case is to set aside Services Australia’s decision of 22 April 2021 and to remit the matter to Services Australia to reconsider its decision with a direction that section 65A not apply from such date within the child support period commencing 1 September 2019 to ensure that Mr Tatro will not have been overpaid child support.

DECISION

[2021] AATA 3844

31 August 2021

Key Legal Topics

Areas of Law

Family Law

Administrative Law

Legal Concepts

Jurisdiction

Remedies

Procedural Fairness

Judicial Review