BROWN & THE CHILD SUPPORT REGISTRAR
[2006] FamCA 1418
•20 December 2006
FAMILY COURT OF AUSTRALIA
| BROWN & THE CHILD SUPPORT REGISTRAR | [2006] FamCA 1418 |
FAMILY LAW – APPEAL – CHILD SUPPORT - PRACTICE AND PROCEDURE – STAY OF PROCEEDINGS – Whether in refusing to stay enforcement proceedings in relation to a New Zealand child support debt registered for enforcement in Australia the trial Judge erred in failing to consider the needs of the children, the father’s capacity to pay, and the incapacity of a New Zealand Court to have regard to payments previously made by the father under Australian and New Zealand law.
FAMILY LAW – APPEAL – CHILD SUPPORT – ENFORCEMENT ORDER - Father argued that the proceedings before the trial Judge were not enforcement proceedings and accordingly that an enforcement order should not have been made – Full Court held that neither party appeared to have understood that an enforcement order was being sought at the hearing, and given that the parties were not offered an opportunity to be heard in relation to the order which the trial Judge proposed to make, the order could not stand.
APPELLANT: | Brown |
RESPONDENT: | The Child Support Registrar |
FILE NUMBER: | CAF 1982 of 1998 |
APPEAL NUMBER: | EA 65 of 2005 |
DATE DELIVERED: | 20 December 2006 |
PLACE DELIVERED: | Canberra |
JUDGMENT OF: | Finn, Holden and Coleman JJ |
HEARING DATE: | 8 September 2005 |
LOWER COURT JURISDICTION: | Family Court of Australia |
LOWER COURT JUDGMENT DATE: | 3 December 2004 |
THE APPELLANT: | Appeared on his own behalf |
COUNSEL FOR THE RESPONDENT: | Mr Berger |
SOLICITOR FOR THE RESPONDENT: | The Australian Government Solicitor |
Orders
That the father be granted an extension of time until 15 August 2005 to file an application for leave to appeal the orders made by the Honourable Justice Rowlands on 26 May 2005.
That the application for leave to appeal be granted.
That the appeal be allowed.
That the orders made by the Honourable Justice Rowlands on 26 May 2005 be set aside and in their place orders 5, 6 and 7 of these orders be made.
That a permanent stay be granted in respect to payment by the father of $3,940.45 being part of a debt of $27,546.12 due to the Commonwealth of Australia as a maintenance debt under the Child Support (Registration and Collection Overseas-related Maintenance Obligations) Regulations 2000 the stayed sum having been paid directly to the mother between 24 August and November 2004.
That the father pay the sum of $6,709.85 (being part of the debt of $27,546.12 referred to in Order 5 of these orders) by way of instalments at the rate of $100 per month commencing on 22 January 2007.
That the application by the father for a permanent stay of the sum of $16,895.82 (being the balance of the debt of $27,546.12 referred to in Order 5 of these orders after deduction of the amount of $3,940.85 referred to in Order 5 of these orders and deduction of the amount of $6,709.85 referred to in Order 6 of these orders) be dismissed.
IT IS NOTED IN CONNECTION WITH THIS ORDER that the Child Support Registrar remains at liberty to institute enforcement proceedings in respect of the sum of $16,895.82 referred to in this order.
That the Court grants to the appellant a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal.
That the Court grants to the respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal.
IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Court delivered this day will for all publication and reporting purposes be referred to as Brown and the Child Support Registrar.
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
APPEAL NUMBER: EA 65 of 2005
FILE NUMBER: CAF 1982 of 1998
| Brown |
Appellant
And
| The Child Support Registrar |
Respondent
REASONS FOR JUDGMENT
This is an appeal against orders made by Rowlands J on 26 May 2005. Those orders, which gave effect to reasons for judgment delivered on 3 December 2004, will be described after the factual background against which they were made is explained. That background as it emerges from his Honour’s reasons for judgment and from other material before us, is as follows.
background
The appellant is the father of three children who relocated to New Zealand with their mother in July 1999. The father continued to pay child support under Australian law until his liability thereunder ceased on 3 July 2000.
On 24 August 2000 he became liable to pay child support under the New Zealand child support scheme.
The Inland Revenue as the New Zealand child support authority issued an initial assessment on 24 August 2000, and then following an administrative departure, three further assessments with a final assessment on 12 April 2001 for NZ$4,028.25 per month for the period 24 August 2000 to 31 March 2002. That assessment was determined on a child support income of NZ$203,583.00. It needs to be understood that the New Zealand financial year, including apparently for child support purposes, begins on 1 April and ends on 31 March.
At some time in the financial year 1 April 2001 to 31 March 2002, the father applied to the New Zealand Family Court for a departure from the administrative assessment for the period 24 August 2000 to 31 March 2002. The mother also applied for a departure from a further administrative assessment which had been made for the period from 1 April 2002.
In a decision delivered on 17 September 2002 Neal J explained that the period to which the father’s departure application related was from 1 April 2001 to 31 March 2002, and that although the assessment was for a period from 24 August 2000 the Court could not “deal with a period prior to that in which the departure application is made”. The decision in Johnson v Hewitt and CIR HC 20 March 2001 AP 404/48/01 was cited in support of that last mentioned proposition.
Neal J then went on to find that the father’s taxable income for the period 1 April 2001 to 31 March 2002 was NZ$124,549 and for the period 1 April 2002 to 31 March 2003 was NZ$125,360.
Child support payments were thus reassessed back to 1 April 2001 at NZ$2,250 per month (or NZ$27,000 per year). However, the original assessment of $4,028 per month for the period 24 August 2000 to 31 March 2001 could not be altered.
Notwithstanding that the father’s Australian liability ceased on 3 July 2000 and his New Zealand liability did not commence until 24 August 2000, the father had paid directly to the mother $3,000 in July 2000, and then $1,309.55 up until 24 August 2000, that is, a total of $4,309.55.
Thereafter he continued to pay directly to the mother (pursuant to his New Zealand liability) an amount of $940.45 for the remainder of August, and then $1,500 for each of September and October; that is, a total of $3,940.45.
As from November 2000 the father paid amounts on account of child support directly to the New Zealand child support authority. It is not clear exactly what amounts were paid, but it is conceded by the father in his written outline of argument for this appeal (paragraph 5), that the “majority of payments were significantly less than the assessed amount of $4,028.25 and this resulted in accumulation of arrears”.
The father claims, and it appears not to be disputed, that since the New Zealand court decision in September 2002, he has paid the amounts assessed and that any arrears only arose in the period 24 August 2000 to 31 August 2002.
Pursuant to the Child Support (Registration and Collection) (Overseas-related Maintenance Obligations) Regulations 2000, the Australian Child Support Registrar (the Registrar) became responsible for the collection of child support from the father from 1 March 2001, initially claiming AU$3,176.42 per month, but with the liability subsequently increasing and significant arrears accumulating.
On 13 August 2001 the Registrar commenced enforcement proceedings in the Family Court of Australia, but these proceedings were stayed by Faulks J pending the outcome of the New Zealand court proceedings, conditional on the father making some payments.
On 29 July 2004 the Registrar filed an application (supported by an affidavit of Mr W on behalf of the Registrar) seeking a declaration that there was owing to the Commonwealth by the father the sum of $27,546.12 (being $26,717.29 in relation to the father’s registered maintenance liability and $828.83 in late payment penalties) and seeking orders that the father pay that amount or “such amounts as may be owing as at the date of final hearing” and also such further orders for enforcement as may be appropriate. We will later set out the precise terms of the orders sought by the Registrar.
On 8 September 2004 the father filed a response seeking a stay of enforcement of the amount sought by the Registrar, or alternatively and pursuant to sub-regulation 36(2) of the Family Law Regulations 1984, that the arrears in respect of the registered maintenance liability be discharged, or that the liability be varied so that for the period 24 August 2000 to 31 March 2001 an amount of NZ$16,280 be credited such amount having been paid by the father and for the period 1 April 2001 to 31 August 2001 an amount of NZ$34,634 be credited as such amount having been paid by the father.
The father’s application for a stay was heard by Rowlands J on 22 November 2004, and on 3 December 2004 his Honour delivered his reasons for judgment.
the reasons for judgment of rowlands j
At the commencement of his judgment, his Honour recorded that the application with which he was concerned was an application by the father seeking to stay permanently enforcement by the Registrar in relation to alleged child support arrears payable to the Commonwealth “of some $27,546.12”. His Honour also recorded that in the alternative the father sought that the amount be discharged by or varied (by an Australian court) pursuant to Regulation 36(2) of the Family Law Regulations 1984.
Having explained that New Zealand child support liabilities can be registered for enforcement in Australia under the Child Support (Registration and Collection) (Overseas-related maintenance obligations) Regulations 2000 and that such registered liabilities can be varied or discharged under the Family Law Regulations 1984, his Honour then summarised the facts of the case in the following terms:
·that the father was the father of three children who had relocated to New Zealand with their mother;
·that up until 3 July 2000 the father had paid child support under an Australian child support assessment;
·that on 24 August 2000 the father became liable to pay child support under the New Zealand child support scheme;
·that between July and November 2000 the father paid child support directly to the mother apparently at the following times in the following amounts:
July $3,000.00
August (to 24th) $1,309.55
August (after 24th) $ 940.45
September $1,500.00
October $1,500.00
$8,250.00
His Honour then noted in relation to these direct payments to the mother, that during the period when he was not covered by the New Zealand scheme (3 July 2000 to 23 August 2000), the father had paid $4,309.55, while in the period when he was covered (24 August 2000 to November 2000) he had paid $3,940.45.
His Honour further noted that the latter sum of $3,940.45 was included in the debt of $27,546.12 which the Registrar sought to enforce, but that recovery of that sum of $3,940.45 was not “vigorously” pressed by the Registrar.
Accordingly, his Honour having cited a passage from the decision of the High Court majority in Walton v Gardiner (1993) 177 CLR 379 (at 392-3), ruled at paragraph 10 of his reasons that he would grant a permanent stay “in respect to that portion of the debt i.e. $3,940.45.”
It should be noted at this point that his Honour’s orders when they ultimately issued on 26 May 2005, did provide for the amount of $3,940.45 to be stayed (although the terms of the relevant order, Order 1, erroneously described the period in which this amount had been paid as 3 July to 23 August 2000, rather than 24 August to 20 November 2000).
It should also be noted that the balance of the liability of $27,546.12 would be $23,705.67 once the portion amounting to $3,940.45 was stayed.
Having determined that he would stay the amount of $3,940.45 (being the liability for the period 24 August to November 2000), his Honour then considered the position in relation to the sum of $4,309.55 which was paid during the period 3 July to 24 August 2000. His Honour determined that this amount was not included in the liability of $27,546.12 (because no assessment was in force for the period 3 July to 24 August 2000), and he also determined that it should not be taken into account as any form of credit (as the father had sought it should) in respect of the enforcement of the liability of $27,546.12 (or the balance thereof of $23,705.76 after the $3,940.45 portion was stayed).
His Honour then turned to “a third issue”. This issue arose out of the application made by the father to the New Zealand court for a departure from the administrative assessment and to the inability of the New Zealand court to grant a departure in respect of the period 24 August 2000 to 31 March 2001. The father sought that his Honour should stay, discharge or vary the assessment for that period, with it having been “put on behalf of the father that through no fault of his he did not make the departure application for that period to the New Zealand court within time”.
Ultimately, and for reasons which we will set out more fully later, his Honour concluded that he should not grant such relief. However, he did determine that the father should be able to pay the obligation for the period in question, which his Honour found amounted to $6,709.85, by way of instalments of $100 per month.
His Honour then concluded his judgment by saying:
21.Orders should be prepared by the Registrar which are designed to give effect to this decision and the uncontested portion of the proceedings. These should be shown to the father within seven days and submitted to the Court within 14 days. He may submit any proposed amendments to the Registrar’s draft.
events subsequent to the delivery of judgment on 3 december 2004
It appears from the affidavits from by both parties which were received by us by consent as further evidence, that on 8 February 2005 the Australian Government Solicitor wrote to the father saying that the father’s liability of $27,546.12 had decreased to $14,082.97, and thus when his Honour’s orders (or proposed orders) for a stay of the sum of $3,940.45 and for the payment by instalments of the sum of $6,709.85, there was only an amount of $3,432.67 to be paid.
However, that letter was withdrawn by a further letter of 9 February 2005.
A further letter was written to the father by the Australian Government Solicitor on 1 March 2005. While that letter referred to the liability on which the trial Judge had proceeded, being $27,546.12, it was also claimed that that amount had “increased” to $29,578.75 representing $26,651.37 in arrears and $2,927.38 in late payment penalties. That letter also acknowledged his Honour’s stay of the amount of $3,940.45 and the amount of $6,709.85 required to be paid by instalments, but it then required payment by 24 March 2005 of the sum of $18,928.45 (ie $29,578.75 – $3,950.45 – $6,709.85).
Draft orders were also enclosed with the letter of 1 March 2005, and it was said that if nothing was heard from the father by 10 March 2005 then the orders would be submitted to the Court.
The terms of the draft orders sent to the father on 1 March 2005 and which were submitted to the Court on 11 March 2005 were as follows:
1.As at 28 February 2005, the Respondent is indebted to the Commonwealth of Australia in the sum of $29,578.75 representing $26,651.37 in maintenance debt pursuant to Regulation 12 and Part IV of the Australia-New Zealand Agreement in Schedule 1 (‘NZ Agreement’) of the Child Support (Registration and Collection) (Overseas-related Maintenance Obligations) Regulations 2000 and $2,927.38 in late payment penalties calculated in accordance with section 67 of the Child Support (Registration and Collection) Act 1988.
2.That a permanent stay be granted in respect of $3,940.45 of the amount referred to in order 1 being the sum paid to [the mother] between 3 July 2000 and 23 August 2000.
3.The respondent pay the applicant the sum of $18,928.45 on or before close of business on 24 March 2005.
4.The respondent pay the applicant the further amount of $6,709.85 by way of instalments at the rate of $100 per month commencing April 2005 on the first business day of each month.
It appears that nothing was heard from the father, but that his Honour then made orders on 26 May 2005. The terms of the engrossed orders which were signed by his Honour, and it will be noted, are markedly different from the draft apparently submitted to him, are as follows:
(1)That a permanent stay be granted in respect to payment by the Respondent Husband of $3,940.45 being part of a debt of $27,546.12 due to the Commonwealth of Australia as a maintenance debt under the Child Support (Registration and Collection Overseas-related Maintenance Obligations) Regulations 2000 the stayed sum having been paid directly to [the mother] between 3 July 2000 and 23 August 2000.
(2)That the Respondent Husband pay the remainder of the debt under the Regulations referred to in Order 1 to the [Child Support Registrar] by:
(a)payment of the sum of $16,895.82 on/before the close of business on 4 June 2005;
(b)payment of the sum of $6,895.82 by way of instalments at the rate of $100 per month commencing on 4 June 2005.
the father’s amended notice of appeal
At the hearing before us the appellant father relied on an amended notice of appeal filed 15 August 2005, which contained the following grounds:
1.The orders of 26 May 2005 cannot be supported by the available evidence as at the date of ‘Reasons for judgment’ of 3 December 2004 and the orders are not in accordance with the “Reasons for judgment’.
2.The Respondent is estopped from seeking enforcement of any amount in excess of $14,082.97.
3.The learned trial judge in exercising his discretion did not consider or apply all of the evidence or legal principles relevant to a stay application and a properly informed tribunal would have granted a permanent stay on enforcement of any debt arising from the incorrect child support assessment.
4.The learned trial judge erred in his consideration of New Zealand law and in his finding that the New Zealand Court had a capacity to have regard to payments previously made.
The orders sought in the amended notice of appeal were as follows:
1.A stay be granted upon enforcement of the order of 26 May 2005 pending finalisation of this Appeal.
2.That a permanent stay be granted in respect to payment by the Appellant of $27,546.12 being a debt due to the Commonwealth of Australia, as a maintenance debt under the Child Support (Regulation and Collection) (Overseas related Maintenance Obligations) Regulations 2000
Or in the alternative
2.That a permanent stay be granted in respect to payment by the Appellant of $3,940.45, being part of a debt of $14,082.97 being a debt due to the Commonwealth of Australia, as a maintenance debt under the Child Support (Regulation and Collection) (Overseas related Maintenance Obligations) Regulations 2000.
3.The Appellant pay the remainder of the debt under the Regulations referred to in order 1 to the Respondent by way of instalments at the rate of $200 per month.
ground one: the orders of 26 may 2005 cannot be supported by the available evidence as at the date of the reasons for judgment of 3 december 2004 and the orders are not in accordance with the reasons for judgment.
In light of the father’s submissions to us, we understand the essential complaint contained in this ground to be directed to Order 2(a) which required the father to pay the sum of $16,895.82 on or before 4 June 2005, with the father submitting that the proceedings before his Honour were not enforcement proceedings.
In response it was submitted on behalf of the Registrar that the father had been given an opportunity to comment on the draft orders submitted to him by the Registrar under cover of the letter dated 1 March 2005; he did not avail of that opportunity; and he should be held bound by the course he had chosen to adopt, and thus by the orders made.
We will consider first the question of whether or not there were enforcement proceedings before his Honour. It is true as will be seen from the terms of the orders sought by the Registrar in the application filed on 29 July 2004, that in addition to a declaration as to the amounts owed by the father to the Registrar, orders were also sought requiring payment of the amounts declared to be owed, with such payment to be within such time as the court determined. The precise terms of the declaration and orders sought by the Registrar were:
1.That the Court make a declaration that there is owing to the Commonwealth in respect of amounts owing under registered maintenance liabilities of the Respondent the sum of $27,546.12 (being $26,717.29 in relation to the Respondent’s registered maintenance liability and $828.83 for late payment penalties or such amount as may be owing as at the date of the final hearing).
2.That the Respondent pay the Child Support Registrar’s costs.
3.That the respondent pay to the Child Support Registrar the sum of $27,546.12 being $26,717.29 in arrears of registered maintenance liability and $828.83 in late payment penalties (or such amounts as may be owing as at the date of final hearing).
4.That payment of the amounts payable in orders 1 and 2 herein be paid to the Child Support Registrar in full, or by instalments, within such time as may be determined by the Court.
5.Such further orders for enforcement of the child support debt as may be appropriate, pursuant to Rule 20.05 of the Family Law Rules 2004….
But whatever the terms of the orders sought by the Registrar in his application filed 29 July 2004, it is clear that the only applications which his Honour and both Counsel understood to be before the Court on 22 November 2004 were the applications contained in the father’s amended response filed 8 September 2004, being for a stay or a discharge or variation of the liability (see paragraph 16 above). This is clear from the discussion between his Honour and both Counsel which appears at pages 1 to 3 of the transcript.
Furthermore, it is then very clear that Counsel for the Registrar, Mr Berger, did not consider that the proceedings before his Honour were enforcement proceedings from the following exchange at page 41 of the transcript:
MR BERGER: …In my submission, that’s not an appropriate case for the exercise of an extreme step of granting a permanent stay.
HIS HONOUR: What about giving him generous opportunities to pay over time?
MR BERGER: We have no difficulty with that, your Honour. We are here to oppose an application for a permanent stay of enforcement, not to say the amount must be paid here and now.
HIS HONOUR: I’m talking about really generous terms which would
permit payment at a relatively low figure over a long period of time.
MR BERGER: Well, depending on what your Honour had in mind ---
HIS HONOUR: Well, I just want you to address that, because that’s
one of the many options. I mean, I might uphold wholly your submissions in this regard, but have some sympathy for the payer. Now, the mother has got through this period, no doubt there have been difficulties for her, but I can’t call what she’ll receive a windfall, but it is a pleasant top-up on the ongoing rate.Now, is there great harm in the circumstances – looking at the totality of the circumstances – in permitting a relatively generous payment arrangement over a period of years?
MR BERGER: I can’t point to any great harm, your Honour. I don’t
act for the mother, and I don’t have information from her in relation to that. In my submission, it would be more appropriate for this issue to be dealt with during the enforcement arm of these proceedings, rather than ---
HIS HONOUR: We want to bring a halt to continuing litigation, if we can. I mean ---
MR BERGER: Yes, your Honour.
HIS HONOUR: ---it’s one thing---
MR BERGER: But there’s all sorts of matters that would be relevant to that question, in my submission.
It may well be that his Honour himself can then be seen as straying, so to speak, into the area of enforcement when, having decided that he would not vary or discharge that part of the liability which the New Zealand court had been unable to deal with, he nevertheless decided (in paragraph 20 of his judgment) that the father should pay the amount owing from August 2000 to 31 March 2001 of $6,750 at the rate of $100 per month.
It also may well be that when (in paragraph 21 of his judgment) his Honour referred to the “uncontested” portion of the proceedings in his direction to the Registrar to prepare orders “designed to give effect to this decision and the uncontested portion of the proceedings”, his Honour had in mind the difference between the total sum claimed by the Registrar of $27,546.12 and the permanently stayed amount of $3,940.45 together with the amount of $6,750.00 to be paid by instalments.
However, it is difficult to see how that difference could be described as the “uncontested” portion, given that the father was seeking a permanent stay of the entire amount of $27,546.12.
Moreover, the father has never been given the opportunity to be heard in relation to the arrangements for payment for the balance of the sum claimed. In this regard we do not consider it open to the Registrar to rely on the fact that the father did not apparently respond to the draft orders submitted to him, prior to their submission to his Honour. We take this view because the orders which his Honour signed were so markedly different to the ones submitted to him in draft form by the Registrar and on which the father was given the opportunity to comment. It would seem that his Honour finally made orders that neither side were given the opportunity to respond to, but it is only the father and not the Registrar who now complains about the orders.
Given that neither party appears to have understood that enforcement orders were being sought at the hearing on 22 November 2004, and given the absence of any further hearing before his Honour, or indeed any evidence that his Honour offered the parties an opportunity to be heard in relation to the form and content of the orders which he proposed to make, it is our view that the orders which were ultimately made, should have reflected his Honour’s decision, or at least so much of it as is clearly discernible. They did not do so and thus the appeal must succeed on the basis of Ground 1.
ground two: the respondent is estopped from seeking enforcement of any amount in excess of $14,082.97
The basis of the claim made by the father in this ground would seem to be not only the letter written by the Australian Government Solicitor on 8 February 2005 but then withdrawn the next day, but also the records of the Registrar as they stood at the time of the hearing before Rowlands J.
The confusion which has surrounded the amount owed by the father as at the date of his Honour’s judgment is somewhat unfortunate. However having regard to the material in, and annexed to, the affidavits filed on behalf of the Registrar on 29 July 2004 (prior to the hearing before his Honour) and on 22 August 2005 (by way of further evidence on the appeal), we are not persuaded that the figure of $27,546.12, which was the total outstanding figure upon which the hearing before his Honour proceeded, was erroneous. Accordingly we do not find merit in Ground 2.
ground three: there was not a proper consideration of or application of legal principles to the evidence and discretion was not exercised
We understand from the father’s written submissions in support of this ground, that it is directed to the principles which govern what the father describes as the Court’s “inherent jurisdiction to stay proceedings, particularly where they are harsh, oppressive, unjust or unfair” (paragraph 14 of his written submissions).
It is clear from the written and oral submissions that each party made to his Honour and from his Honour’s reasons for judgment that all concerned proceeded on the basis that the High Court decision in Walton v Gardiner (supra) establishes in his Honour’s words (paragraph 3 of his judgment), that the court “has power, under its inherent jurisdiction, to stay proceedings which are unjust or unfair”, and that such relief is available in proceedings concerning an overseas child support liability registered for enforcement in Australia. It is thus unnecessary that we concern ourselves with the issue of whether such relief is indeed available in such proceedings.
It was the father’s position before us that in considering the issue of fairness for purposes of the application for a permanent stay, his Honour should have had regard to the needs of the children and in particular whether they would be prejudiced by any stay of enforcement, and also to the father’s capacity to pay.
The difficulty for the father is that neither of these specific matters was relied on by his Counsel in her comprehensive written submissions to his Honour. In paragraph 18 of her submissions Counsel set out a number of specific matters in support of the submission that it would be “manifestly unfair and unjust” to the father to refuse the permanent stay. While Counsel included in those matters the fact that the mother would be “unjustly enriched” if she receives the arrears, the specific matters of the children’s needs and the father’s capacity were not relied on in Counsel’s written submissions, nor it would seem from the transcript, in her oral submissions. In these circumstances his Honour cannot be said to have been in error in not considering the matters now sought to be relied on, and accordingly Ground 3 cannot succeed.
ground four: the trial judge erred in considering new zealand law and in his conclusion that the new zealand court had capacity to have regard to payments previously made
This challenge is directed to paragraph 19 of his Honour’s judgment, which must be read against the background of the three immediately proceeding paragraphs:
16 The father urges this Court to stay, discharge or vary the assessment for the period which the New Zealand Family Court felt unable to deal with i.e. from 24 August 2000 to 31 March 2002 [semble 2001]. It was put on behalf of the father that through no fault of his he did not make the departure application for that period to the New Zealand Court within time.
17 The various activities within the New Zealand authority and before the commissioner certainly delayed the matter. Perhaps the father could have referred the matter to the New Zealand Court earlier. However one cannot deny that recourse to a court is, for the normal person, not something lightly undertaken; and certainly where a series of “readjustments” are being made by the authorities short of the Court. The law as a matter of general policy does not encourage litigation if matters can be resolved without going to court.
18 Applying the principles earlier discussed should this Court in the circumstances stay, discharge or vary the assessment for this period? This consideration being in the context of Judge Neal finding error in the approach of the Authority below in respect of the period he was seized of and ordering a departure accordingly.
19 Ultimately I have come to the conclusion that such action should not be taken. The legal authorities make it clear that such a course should not be lightly undertaken. Here under New Zealand legislation, the Child Support Act 1991, there was a capacity in the New Zealand Court to have regard to any payments previously made by the father as the liable parent when determining the magnitude of the departure under consideration (and consequently for the father to argue the matter before that Court) – see among other provisions Sections 105 and 106 of the Act.
20 However I have come to the conclusion that the father should have relatively generous terms in which to discharge this particular obligation of $4,459.85 + $2,250 = $6,709.85 (see Annexure D to affidavit of [Mr W] 20 July 2004). It concerns a period now well past. Further it appears the institutional delays and reconsiderations did place difficulties in the father’s path which he should at least have an opportunity to recover from. He may pay the outstanding sum here of $6,709.85 at the rate of $100 per month.
It can be assumed that his Honour made the comment he did in paragraph 19 regarding the capacity of the New Zealand court to have regard to the previous payments made by a liable parent, because his attention had been drawn to the provisions of s 105(2)(c)(ii) of the New Zealand Child Support Act 1991 by Counsel for the Registrar. Counsel then, in effect, submitted that the father had had the opportunity before the New Zealand court to rely on the reference in s 105(2)(c)(ii) to earlier payments in order to obtain relief in relation to the period which could not be the subject of a departure order, but in which monies had been paid. (See Transcript p58).
Section 105(2) sets out the grounds for obtaining a departure order and includes:
(c)That, by virtue of special circumstances, application in relation to the child of the provisions of this Act relating to formula assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child because of ---
(i) …
(ii) Any payments, and any transfer or settlement of property, previously made (whether under this Act, the Matrimonial Property Act 1976 or otherwise) by the liable parent to the child, to the qualifying custodian, or to any other person for the benefit of the child[.]
…
In support of Ground 4 the father now contends, as we understand his submissions, that his Honour and Counsel for the Registrar were in error to place any reliance on s 105(2)(c)(ii) because that provision could only apply to payments made in the financial year for which a departure order was being sought. In support of that last mentioned proposition, the father relies on the decision of the New Zealand High Court in Johnson v Commissioner of Inland Revenue [2002] 2NZLR 816, in particular the following passage in paragraph 52 of the judgment in Johnson (supra):
…that s 105(2)(c)(ii) was:
“…intended to provide a ground of departure only in relation to formula assessment for the child support year current at the time the departure application was made, or for future child support years….”
Thus, the father submits that in the exercise of his discretion refusing the permanent stay of the entire liability, his Honour can be seen as having made a mistake of law, or to have taken into account an extraneous consideration, with the result that his discretion miscarried.
However, in the absence of much fuller argument concerning the relevant New Zealand law, we are far from persuaded that the passage in Johnson (supra) on which the father relied (which was in fact a passage from the earlier decision in Commissioner of Inland Revenue v Aspinall [1999] 3 NZLR87) supports the proposition that payments of the type referred to in s 105(2)(c)(ii) can only be relied on as establishing a ground for departure, if they were made in the period for which the departure order is sought.
We say this having regard to the full context in which the statement now sought to be relied upon by the father was made in Johnson. The relevant paragraphs of that decision are:
51The appellant applied to the Family Court for orders that the Commissioner’s assessment in respect of the years ending 1996-2001 be departed from. Judge Kendall relied on Commissioner of Inland Revenue v Aspinall [1999] 3 NZLR 87 and held that the Family Court does not have authority under s 104 to make a departure order for previous child support years. The appellant submits that Aspinall was wrongly decided and that the Family Court does have power to alter the assessments in previous child support years retrospectively.
52In Aspinall, Goddard J held that the Family Court did not have authority to order a departure from assessments relating to previous child support years. The salient aspect of the case concerned s 105(2)(c)(ii) of the Act. Goddard J followed the analysis of Judge Inglis in Taylor v Oliver (1997) 15 FRNZ 392 and held, at pp94-95, that s 105(2)(c)(ii) was:
“…intended to provide a ground for departure only in relation to formula assessment for the child support year current at the time the departure application was made, or for future child support years…
It would be quite inconsistent with the Act’s stated object of certainty of formula assessments, acknowledged and accepted as just and equitable by the parties at the time they are made, are able to be retrospectively re-opened. If circumstances change which do not require reassessment then such reassessment can only be contemporaneous with the change in circumstances, or prospective. The Act does not envisage otherwise.”
53On behalf of Mr Johnson, Mr Vickerman submitted that the Court in Aspinall was not directed to ss 96B, 96D, 96O or 106. He argued that these sections indicate that the scheme of the Act is not opposed to retrospective departure from formula assessments. Therefore, the prospective words in s 105(2)(c)(ii) are to be read as speaking from the time when the formula assessment was originally made…
…
55It seems that both s 96O and s 106(2) contemplate the Commissioner or the Family Court making a departure order in respect of previous assessment years. Quite clearly, s 96O allows for limited retrospective application of the Commissioner’s powers. The retrospectivity is limited to the introduction of the 1994 amending provisions and to the date of the application for a departure order. Thus, it is not open to the Commissioner to order departure from formula assessment years prior to the application under Part VI of the Act. A limited retrospective power has thus been created in order to protect the position of applicants pending resolution of their application.
56This supports the argument that the Act as a whole is designed to function prospectively. Section 96O is a specific rule that allows for limited retrospectivity. That implies that outside of s 96O, the Act is directed at the assessment year in question; it does not permit the Family Court to delve into and reopen previous assessment years. This conclusion is consistent with Goddard J’s finding in Aspinall.
While we acknowledge that the matter is not entirely free from doubt, we are of the view, at least as currently advised, that nothing said in the above passage from Johnson or in the authorities there cited, would have prevented the father from relying in support of his departure application on payments made in a period prior to the period in which the departure application was made. We are certainly not persuaded that we should find that his Honour erred as asserted by Ground 4.
conclusion
We have thus found substance only in Ground 1 which is essentially to the effect that his Honour’s orders do not reflect his judgment. It will be convenient to set out again at this point his Honour’s orders:
(1)That a permanent stay be granted in respect to payment by the Respondent Husband of $3,940.45 being part of a debt of $27,546.12 due to the Commonwealth of Australia as a maintenance debt under the Child Support (Registration and Collection Overseas-related Maintenance Obligations) Regulations 2000 the stayed sum having been paid directly to [the mother] between 3 July 2000 and 23 August 2000.
(2)That the Respondent Husband pay the remainder of the debt under the Regulations referred to in Order 1 to the [Child Support Registrar] by:
(a)payment of the sum of $16,895.82 on/before the close of business on 4 June 2005;
(b)payment of the sum of $6,895.82 by way of instalments at the rate of $100 per month commencing on 4 June 2005.
As we noted earlier in paragraph 23, Order 1 is erroneous only in respect of the period stated to be the period during which the amount of $3,940.45 was paid. It might be speculated that his Honour when drafting this order was mislead by the terms of draft Order 2 in the orders provided to him on behalf of the Registrar. But however that may be, we propose to amend Order 1 to refer to the correct period when the relevant amount was paid.
So far as Order 2 is concerned, paragraph (a) must be discharged for the reasons discussed, being that the proceedings before his Honour were not enforcement proceedings and the father was never given an opportunity to be heard in relation to the payment of the sum of $16,895.82, being the difference between the total sum of $27,546.12 claimed by the Registrar before his Honour and the sum of $3,940.45 (which was stayed) and $6,709.85 (which according to his Honour was to be paid by instalments).
A discharge of Order 2(a) does not of course stay or discharge the liability on the part of the father for the sum of $16,895.82. Enforcement proceedings could still be brought in respect of that sum. However, it is to be hoped having regard to the terms of Order 3 sought in the father’s amended notice of appeal, that some arrangement for payment of that amount by instalments might be negotiated.
We will dismiss the application for a permanent stay of this balance sum as this is the order which we consider that his Honour should have made.
In our view, Order 2(b) with its reference to the sum of $6,895.82 is also erroneous. The correct figure should have been $6,709.85 as stated in paragraph 29 of his Honour’s judgment. We would also amend the date to 15 January 2007.
Given the alterations which we consider need to be made to his Honour’s orders, the most convenient course will be to set aside those orders and for us to make the orders which we consider his Honour should have made.
the need for leave to appeal
At a procedural hearing on 14 July 2005, orders were made on that occasion requiring the appellant father to file an application for leave to appeal the orders and for an extension of time to file the application for leave to appeal – although it was noted in those orders that neither party considered leave to appeal was necessary.
Nevertheless, the father did file on 15 August 2005 an application for leave to appeal and an application to extend time for the filing of such an application.
Section 107 of the Child Support (Registration and Collection) Act 1988 provides that an appeal under that Act (and presumably under the Regulations made under it) only lies with the leave of the Full Court. However, the question of whether or not leave is required for this appeal by the father was not pursued by either before us. As indicated above, neither party considered it necessary. In these circumstances, we think that the prudent course is to grant leave on the assumption that it is necessary and also to extend time to 15 August 2005 for the father to file the application for leave to appeal.
costs of the appeal
Given that the appeal has succeeded on the basis of an error of law constituted by the failure of the orders of the trial Judge to reflect his judgment, and in light of submissions made at the conclusion of the hearing of the appeal, we will grant both parties certificates under the Federal Proceedings Costs Act 1981.
I certify that the preceding seventy-one (71) paragraphs are a true copy of the reasons for judgment of this Honourable Full Court
Associate:
Date: 20 December 2006
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