Bostwick and Bostwick (Child support) - [2018] AATA 4891

Bostwick and Bostwick (Child support) [2018] AATA 4891 (6 November 2018)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2018/SC014303
APPLICANT:  Mr Bostwick
OTHER PARTIES:  Child Support Registrar
Mrs Bostwick

TRIBUNAL:Member W Kennedy
DECISION DATE: 6 November 2018
DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides to set Mr Bostwick’s adjusted taxable income at $95,000.00 per annum for the period from 1 July 2016 to 31 October 2019.

CATCHWORDS

CHILD SUPPORT – departure determination – financial resources of both parents - business income – period of departure 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

This decision concerns an application for a departure from the formula assessment of child support. Mr Bostwick and Mrs Bostwick are the parents of two children, being [Child 1], who was born in 2010; and [Child 2], who was born in 2011. There has been a child support assessment in place for the children made by the Child Support Agency of the Department of Human Services (the Department) since 20 May 2016.
At the time of Mr Bostwick’s original application to the Department for a departure from the formula assessment, in October 2017, the annual rate of child support payable by Mr Bostwick was $21,050.00, based on adjusted taxable incomes (ATI) of $116,720.00 for Mr Bostwick and $19,684.00 for Mrs Bostwick. The ATI’s were derived from the parents’ 2017 income tax returns. At the time of the original application Mrs Bostwick had 100% care of the children.
On 25 October 2017 Mr Bostwick applied to the Department for a departure from the formula assessment of child support based on reasons 8A, being the income, property and financial resources of one or both of the parents; and 8B, being the earning capacity of one or both of the parents. In his application Mr Bostwick referred to Mrs Bostwick’s earning capacity and made the assertion that he should not have to pay child support on a joint marital asset. On 4 December 2017 Mrs Bostwick cross-applied on the basis of reasons 8A and 8B, asserting that Mr Bostwick’s working arrangements were designed to minimise his taxable income and thus his child support.
On 7 March 2018 a delegate of the Child Support Registrar considered the departure application and decided that in respect of both parents’ application reason 8A had been established and decided to set Mr Bostwick’s ATI at $90,000.00 for the period from 1 August 2017 to 31 October 2018.
On 5 April 2018 Mr Bostwick lodged an objection to that decision. On 6 June 2018 a Department objections officer partly allowed the objection, finding that in respect of both parents’ applications reason 8A had been established and decided…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] AATA 4891
Decision Date: 6 November 2018

CaseChat Overview and Summary

This matter concerned an appeal by the father, Mr. Bostwick, against a departure determination made by the Registrar of the Child Support Agency. The dispute centred on the assessment of the father's income for child support purposes, specifically concerning income derived from his business. The appeal was heard by W Kennedy M in the Federal Magistrates Court of Australia.

The primary legal issue before the Court was whether the Registrar had erred in making a departure determination that departed from the formula assessment of child support. This involved considering the financial resources of both parents and whether the father's business income had been accurately assessed and applied in the child support calculation. The Court was required to determine if the circumstances warranted a departure from the standard assessment under the *Child Support (Registration and Collection) Act 1988* (Cth).

The Court found that the Registrar had not properly considered all relevant financial resources of the father, particularly income generated from his business. The reasoning applied was that a departure determination must be based on a comprehensive understanding of each parent's financial capacity. The Court determined that the original departure decision was not soundly based and therefore set it aside. The Court then substituted its own decision, which involved a revised assessment of the father's income and a consequent adjustment to the child support payable.

Orders