Burne and Anketell (Child support) - [2023] AATA 854

Burne and Anketell (Child support) [2023] AATA 854 (12 January 2023)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2022/SC024543
APPLICANT:  Mr Burne
OTHER PARTIES:  Child Support Registrar
Ms Anketell

TRIBUNAL:Member J Nalpantidis
DECISION DATE: 12 January 2023
DECISION:

The Tribunal set aside the decision under review and substituted its decision that for the period 1 January 2022 until 31 December 2025, the annual rate of child support is increased by $11,630 to reflect Mr Burne’s 50% contribution to the child’s annual school fees .

CATCHWORDS

CHILD SUPPORT – departure determination – costs of education - manner expected by both parents - cost of maintaining the children are significantly affected – a ground for departure established – decision to depart – 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

Mr Burne and Ms Anketell are the separated parents of two children aged 13 years and 11 years, and the children are reflected as being in Ms Anketell’s 100% care. A case has been registered with Services Australia –Child Support (the Agency) since 20 December 2010 where Mr Burne is the payer of child support and Ms Anketell the payee. Child support has been collectable by the Agency from 29 January 2015 and as at the objections decision date, 2 August 2022, the account was up to date.
At the time the relevant application was made, the following child support assessment was in place:
·     for the period 1 November 2021 to 12 May 2022, the annual rate of child support was $15,408, based on an income estimate of $97,205 for Mr Burne and a 2020/2021 adjusted taxable income for Ms Anketell of $79,146;
·     for the period 13 May 2022 to 30 June 2022, the annual rate of child support was $17,414, based on an income estimate of $97,205 for Mr Burne and 2020/2021 provisional income for Ms Anketell of $49,671;
·     for the period 1 July 2022 to 31 January 2023, the annual rate of child support was $32,622, based on a 2020/2021 adjusted taxable income of $196,942 for Mr Burne and a 2020/2021 adjusted taxable for Ms Anketell of $79,146.
On 22 February 2022, Ms Anketell applied for a departure determination on the basis that the child support assessment was unfair because the costs of maintaining the oldest child (the child) are significantly affected by the costs of caring for, educating, or training them in a way that both parents intended (called “Reason 3” by the Department).
On 11 April 2022, an employee of the Agency found the ground was established and made a departure determination and the assessment was changed as follows:
· for period 1 January 2022 to 31 December 2022, the annual rate…

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.

Continue reading Burne and Anketell (Child support)

Details

AGLC: Burne and Anketell (Child support) [2023] AATA 854
Case: [2023] AATA 854
Decision Date: 12 January 2023

CaseChat Overview and Summary

This matter concerned an appeal to the court regarding a departure determination made by the Child Support Registrar. The dispute involved Mr Burne and Ms Anketell, who were seeking to vary child support payments. Ms Anketell had incurred significant extra schooling and sporting costs for the children, amounting to $6,296, without any contribution from Mr Burne. Mr Burne had previously indicated a willingness to contribute $3,000 annually towards school fees.

The court was required to determine whether the Registrar's decision to depart from the formula assessment of child support was justified. Specifically, the court needed to assess if the costs incurred by Ms Anketell for the children's education and extracurricular activities were of a type and amount that significantly affected the costs of maintaining the children, and if these costs were incurred in a manner that was expected by both parents.

The court considered the evidence presented by both parties regarding their financial circumstances and the nature of the expenses. Ms Anketell provided detailed evidence of the extra schooling and sporting costs, which the Tribunal accepted. Mr Burne's financial position was examined, including his previous high income, his current reduced salary due to medical discharge, and income from an investment property. The court noted that Mr Burne's income for the 2020-21 financial year was unusually high due to leave payouts and increased investment income, and that his current income was expected to be lower. Despite Mr Burne's financial circumstances, the court found that the costs incurred by Ms Anketell were substantial and directly related to the children's upbringing in a manner that could be considered expected by both parents. The court concluded that a ground for departure was established, as the costs significantly affected the maintenance of the children.

The court set aside the Registrar's decision and substituted it with its own determination, finding that a departure from the formula assessment was warranted.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

Ms Anketell gave detailed evidence, accepted by the Tribunal, of meeting various extra schooling costs for both children and costs of sporting activities for the child, in the amount of $6,296, with no contribution from Mr Burne. Mr Burne gave evidence that three years ago he was prepared to contribute $3,000 per year for the child’s school fees; he told the Tribunal school fees at a school like Mater Maria Catholic College were $3,174 per year. When his circumstances changed three years ago, Mr Burne was employed with a base salary of $126,000 and with overtime he earned more than $132,000 per year. He was medically discharged after being off work for 9 months and his salary reduced to 75%, which is approximately $97,500 per year, a reduction of $30,000 to $35,000 gross per year compared to his previous income. Mr Burne gave evidence that he was discharged from his [Occupation 1] employment in the 2020–21 financial year which meant he was paid out his long service leave (four to six months) and other leave accruals on top of his usual salary of $126,000. As a result of COVID lockdowns in Australia and no international travel, he also had an unusually higher income from his investment property at [Town 2]. The leave accruals and his increased investment income resulted in his income for that financial year being $196,000. He expects his current year income to be much less. Mr Burne submitted he would not make enough investment income from the [Town 2] property to cover school fees. Generally he claims 20% personal usage of the property and has claimable expenses. The peak season for rental is winter, from June to October, when the property is rented out for $3,500 per week. It is available for the whole year but usage is much less in summer, when the rate of rent is also reduced. Mr Burne told the Tribunal he generally uses the property for personal holidays when it is available. He does not go to the property a lot, this year he has gone to the [Town 2] property, attending around bookings every second or third weekend. Mr Burne told the Tribunal he earned a small income from the [Town 2] property during COVID because the resorts shutdown; as a result he lost bookings and had to refund payments from previous years’ bookings. He said the property has expenses such as cleaning, laundry, interest costs, repairs and maintenance; he estimated the maximum gross income he could make from the property is $18,000 gross per year, with estimated net income of $3,000 to $5,000 per year, which may be $2,000 after tax. Mr Burne gave evidence he has a $70,000 mortgage on his [City 1] home. The mortgage is currently $60,000, with a re-draw of $10,000 available. He estimated the property was valued at $500,000. His [Town 2] investment property has a mortgage of approximately $210,000 mortgage and he estimated it was valued at $350,000. In the Statement of Financial Circumstances, Mr Burne listed his average weekly income at $1,870.76, plus investment income of $86.94. He listed his partner’s income at $3,747 gross per week. He listed his home (in [City 1]) as valued at $500,000 (with a mortgage of $60,350), and other (in [Town 2]) property of $350,000 (with a mortgage of $204,745). He listed other assets as shares valued at $2,290 and two motor vehicles valued at $7,550, household contents of $15,000 and superannuation of $318,265. Mr Burne listed unpaid tax of $7,500 a credit card debt of $2,449 and child support arrears of $3,085. His total liabilities were listed as $278,129. The value of his total property assets was listed at $874,840 (excluding superannuation of $318,265). The Tribunal accepted that the above amounts represent Mr Burne’s level of income, property and financial resources.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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