Carrell v Mayne
[2021] FedCFamC2G 162
•20 October 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)Carrell v Mayne [2021] FedCFamC2G 162
File number(s): ADG 326 of 2019 Judgment of: JUDGE BROWN Date of judgment: 20 October 2021 Catchwords: CHILD SUPPORT – ADMINISTRATIVE LAW – application for Judicial Review – appeal from the Administrative Appeals Tribunal – nature of a Judicial Review – departure application – duty of disclosure – challenge to the findings about the income of the applicant – approach adopted by the Administrative Appeals Tribunal in accordance with the Child Support (Assessment) Act 1989 (Cth) – whether grounds of review amount to an error of law – where the applicant has been entirely unsuccessful in proceedings – application for costs order Legislation: Administrative Appeals Tribunal Act 1975 (Cth) ss 3, 44AAA
Child Support (Assessment) Act 1989 (Cth) Pt 6A, ss 4, 98C, 100, 117
Child Support (Registration & Collection) Act 1988 (Cth) Pt VIIIA, s 105
Family Law Act 1975 (Cth) s 117
Federal Circuit & Family Court of Australia Act 2021 (Cth) ss 7, 214
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) Sch 2, rr 22.02, 22.09
Federal Circuit Court of Australia Act 1999 (Cth) s 79.Cases cited: Apthorpe v Repatriation Commission (1987) 13 ALD 656
BKK16 & BKN16 & Anor [2017] FCCA 938
CCQ17 v Minister for Immigration & Border Protection [2018] FCA 1641
Child Support Registrar & Crabbe and Anor [2014] FamCAFC 10
Child Support Registrar & Pearce & Anor (SSAT Appeal) [2018] FamCAFC 10
Collector of Customs v Pressure Tanker Pty LtdandPazzolanic Enterprises Pty Ltd (1993) 43 FCR 280
Htun v Minister for Immigration & Multicultural Affairs (2001) 233 FCR 136
Humphries & Berry (SSAT Appeal) [2008] FMCAfam 409
Latoudis v Casey (1990) 170 CLR 534
LDME & JMA (SSAT Appeal) (2007) 38 Fam LR 132
Luton v Lessels (2002) 210 CLR 333
Miller v Ng & Anor (No 2) [2018] FCCA 26
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24
Minister for Immigration & Border Protection v Singh (2003) 231 FCR 437
Minister for Immigration & Border Protection v Stretton (2016) 237 FCR 1
Minister for Immigration & Border Protection v SZVFW (2018) 264 CLR 541
Minister for Immigration & Citizenship v Li (2013) 249 CLR 332
Minister for Immigration & Citizenship v SZIAI & Anor (2009) 259 ALR 429
Minister for Immigration & Citizenship v SZMDS (2010) 240 CLR 611
Minister for Immigration & Ethnic Affairs v Wu Shan Ling [1996] 185 CLR 259
Minister for Immigration & Multicultural Affairs v Al Miahi (2001) 65 ALD 141
Minister for Immigration & Multicultural Affairs v Yusuf (2001) 206 CLR 323
Minister for Immigration and Citizenship v SZRKT (2013) 212 FCR 99
Re Kirby; Ex Parte Boilermakers’ Society of Australia (1956) 94 CLR 254
Re Minister for Immigration & Multicultural Affairs: Ex Parte Applicant S20/2002 (2003) 198 ALR 59
Re Minister for Immigration & Multicultural Affairs: Ex parte Lam (2003) 214 CLR 1
SZBEL v Minister for Immigration & Multicultural & Indigenous Affairs (2006) 228 CLR 152
Thomas & Harry (SSAT Appeal) [2010] FMCAfam 310Division: Division 2 General Federal Law Date of hearing: 22 March 2021 Place: Adelaide Number of paragraphs: 167 Date of hearing: 22 March 2021 Place: Adelaide Counsel for the Applicant: The Applicant appearing In Person Counsel for the First Respondent: The Respondent appearing In Person Counsel for the Second Respondent: Mr Bishop Solicitor for the Second Respondent: Mills Oakley ORDERS
ADG 326 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR CARRELL
Applicant
AND: MS MAYNE
First Respondent
CHILD SUPPORT REGISTRAR
Second Respondent
ORDER MADE BY:
JUDGE BROWN
DATE OF ORDER:
20 OCTOBER 2021
THE COURT ORDERS THAT:
1.The Notice of Appeal filed by the Applicant on 10 September 2019, amended on 12 December 2019, and further amended on 17 September 2020 be dismissed.
2.The applicant pay the second respondent a lump sum of costs fixed at FIVE THOUSAND DOLLARS ($5,000.00).
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
Section 110X(4)(h) of the Child Support (Registration and Collection) Act 1988 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Carrell v Mayne has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE BROWN:
INTRODUCTION
This is an appeal from a decision of the Administrative Appeals Tribunal,[1] in respect of a child support assessment and a subsequent administrative review. It concerns a decision of the Tribunal made on 5 August 2019, which relates to a raft of other decisions, including an earlier decision of the AAT, made on 13 March 2018.
[1] Herein after referred to as ‘the AAT’ or ‘the Tribunal’.
The task set for the Court, by the Legislature, on the judicial review of an assessment of child support, is not to conduct a rehearing of the case concerned, which involves a revaluation of the evidence available and, if the Court reaches a different conclusion about that material, substituting its own decision for the of the original decision-maker.
Rather, the Court’s authority to intervene arises only if it can detect a legal error in the manner in which such decision-maker has exercised the authority conferred upon it. In the jargon of lawyers, this is referred to as a jurisdictional error.
BACKGROUND
Mr Carrell is the father of two children – X born in 2005 and Y born in 2009.[2] Ms Mayne is the children’s mother.[3] The parties married in 2004 and separated on 18 March 2016. At the time, they lived with X and Y in suburban Adelaide. Their separation led to Family Law proceedings, in respect of both property and parenting arrangements, which have since been consensually settled.
[2] Herein after referred to as ‘the father’ or ‘the applicant’.
[3] Herein after referred to as ‘the mother’ or ‘the first respondent’.
In terms of parenting arrangements, the parties agreed that X and Y would live predominantly with their father, in Adelaide, and would spend regular time with their mother, during school holidays, in the South East area of Queensland, where the mother had elected to relocate to pursue another relationship. In more recent negotiations, the parties have agreed for X to live with the father in Adelaide, and Y live with the mother in South East Queensland from January 2022.
Child Support Assessments, in respect of X and Y, commenced on 18 May 2016. These assessments are administratively made by the Department of Human Services through its Child Support Agency.[4] In the period since, there have been numerous objections to the relevant assessments, both within the CSA and externally, including an earlier review to the AAT.
[4] Herein after referred to as ‘the CSA’ or ‘the Agency’.
These various objections have largely centred on issues to do with the financial circumstances of the parents; the costs of travel between Queensland and South Australia; and the special needs of the children in respect of private school education, particularly in respect of hobby and orthodontic care for X.
At times relevant to the current proceedings, the CSA has recorded care arrangements for Y and X as being 73% in the care of their father and 27% in the care of their mother. Given the children’s living arrangements, this has resulted in the mother being assessed to pay child support to the father for the periods which are relevant to the current appeal, which is from April 2018 to December 2020.
It is axiomatic from the three volumes of documents and the many administrative decisions made in respect of the various assessments of child support, that there have been very many controversies arising between the parties concerning how financial support is to be provided by them for X and Y.
These controversies have centred on the following issues:
·Whether the cost of maintaining X and Y are affected by the children’s special needs – this has primarily related to orthodontic expenses related to X, which have been incurred, whilst in her father’s care;
·Whether the cost of maintaining X and Y are affected by the manner in which their parents have agreed that the children are to be educated – this relates to private school fees incurred for both children and hobby classes for X;
·Whether the relevant assessment fairly reflects the income, property and financial resources of each of the parties – each of the parties asserts that this is not the case;
·Whether the costs incurred by the mother in spending time with the children, primarily due to the costs of interstate travel, are high and therefore justify a departure in the mother’s child support income; and
·Whether recent medical expenditure incurred by the mother, related to her treatment for breast cancer, have increased her self-support costs and therefore rendered it just and equitable to reduce her income for child support purposes.
These controversies have informed applications for departure mounted by each of the parties in proceedings before both the AAT and at earlier arms-length review processes before the Agency in its Objections Decision-making process.
The AAT decision relevant to these proceedings relates to a decision of an Objections Decision-Maker made on 19 February 2019.[5] The Objections Officer concerned made the following assessments:
·From 19 April 2018 to 31 July 2018, the annual rate of child support to be paid by the mother be set at $3,500.00;
·From 1 August 2018 to 31 January 2019, the annual rate of child support to be paid by the mother be set at $2,000.00;
·From 1 January 2019 to 31 December 2019, the annual rate of child support to be paid by the mother be set at $3,500.00; and
·From 1 January 2020 to 31 December 2020, the annual rate of child support to be paid by the mother be set at $4,000.00.
[5] Herein after referred to as the ‘Objections Officer’.
The period from 1 August 2018 to 31 January 2019, relates to the period the mother was not able to work as a consequence of her cancer treatment. This resulted in the reduction of the child support payable by her to the father.
The decision of the Objections Officer affected an earlier decision of the AAT made on 13 March 2018. The effect of this decision was the fix the father’s adjustable taxable income, for the period from 1 July 2016 to 1 December 2020 at an amount of $94,000.00 per annum and for the mother’s adjusted taxable income, for the same period, to be fixed at $66,000.00 per annum.
The father has never accepted that the level of income attributed to him is correct. For her part, the mother believes this assessment is appropriate and should therefore inform all applicable assessments of child support.
The mother, at relevant times, has been employed as a counsellor by an organisation known as Employer B. She is a PAYG tax payer, but has been able to salary sacrifice in respect of some of her recurrent expenses, thus reducing her taxable income. As I understand it, this relates to the public benevolence status of her employer.
The mother’s financial affairs are not unduly complicated, as her income has been documented by recurrent payslips. Although her hours of work have changed, from 35 hours to 20 hours per week, her hourly rate has remained at $32.97.
The mother has also been able to provide receipts of airfares purchased by her for the children to travel to and from Queensland. In addition, she has provided a number of medical reports and invoices related to her cancer treatment for the periods relevant to the proceedings.
The father’s financial affairs are more complex. He is employed by a company, of which his parents are the sole directors. They are now elderly and do not engage in the day to day management of the business, which is left to their son.
The relevant company also operates a trust, which functions as an investment mechanism for its beneficiaries. The company invests primarily in Australian shares, which produce franking credits from time to time. The father and his parents are beneficiaries of the trust.
Controversies have arisen as to what benefits the father receives from the company and trust in question and, as a consequence, what is the father’s actual level of income received by him. This is the central issue in the current matter, which relates to findings of fact made by the AAT as to the income it attributed to the father. It being the mother’s contention that the father receives significant benefits from the company and the income attributed to him, by the AAT, should stand and its finding in this regard is not one which is vitiated by legal error.
The decision subject to appeal
As indicated above, the AAT made the decision, which is the subject of the current appeal, on 5 August 2019. Its decision was as follows:
·For the period 1 July 2017 to 31 December 2020, the father’s adjusted taxable income be fixed at $75,000.00;
·For the period from 1 July 2017 to 30 June 2018, the mother’s adjusted taxable income be fixed at $64,481.00;
·For the period from 1 July 2017 to 30 June 2018, the annual rate of child support payable by the mother be increased by $1,000.00;
·For the period from 1 July 2018 to 31 October 2019, the mother’s adjusted taxable income be fixed at $44,700.00; and
·For the period from 1 January 2020 to 31 December 2020, the annual rate of child support payable by the mother be increased by $1,000.00.
The legal principles applicable to departure applications
At the outset, it is important to note that the involvement of courts, such as this one, in the assessment of child support, is closely circumscribed. Fundamentally, the calculation of child support to be paid by parents in respect of the financial support of their children is an administrative matter.
Essentially, the amount of financial support to be provided by parents, for their children, is calculated formulaically by the application of a legislative regime created by the Child Support (Assessment) Act 1989 (Cth) and the Child Support (Registration & Collection) Act 1988 (Cth).[6]
[6] Herein after referred to as ‘the Assessment Act’ and ‘the Collection Act’ respectively.
These complex pieces of legislation are supported by other legislation, related to social welfare payments, taxation matters and the like. The rationale of the child support regime is that the provision of financial support, to be provided by parents, for their children, will be uniform as a consequence of the application of a number of legislative prescribed formulae.
As a consequence, it is only if a parent can demonstrate special circumstances, based on one or a number of prescribed grounds, that there should be any departure from the amount of child support flowing from the application of the applicable formulae relevant to the calculation of child support.
The relevant formulae are based on a number of elements, which primarily relate to the respective incomes of the parents themselves and the extent of care, which each provides to any relevant child.
The principal object of the Assessment Act is to ensure that children receive a proper level of financial support from their parents.[7] This object is supported by the following particular objects set out in section 4(2) as follows:
a)that the level of financial support to be provided by parents for their children is determined according to their capacity to provide financial support and, in particular, that parents with a like capacity to provide financial support for their children should provide like amounts of financial support; and
b)that the level of financial support to be provided by parents for their children should be determined in accordance with the costs of the children; and
c)that persons who provide ongoing daily care for children should be able to have the level of financial support to be provided for the children readily determined without the need to resort to court proceedings; and
d)that children share in changes in the standard of living of both their parents, whether or not they are living with both or either of them; and
e)that Australia is in a position to give effect to its obligations under international agreements or arrangements relating to maintenance obligations arising from family relationship, parentage or marriage.[8]
[7] See Assessment Act, s 4(1).
[8] Ibid s 4(2).
Additionally, the notion of parents providing a proper level of support to children is ingrained in public policy and defined by social norms. It was outlined by Gleeson CJ in Luton v Lessels that:
[A]lthough the legislation is enacted in furtherance of a clearly defined public policy, it creates a distinctly personal liability. The natural and moral obligation of a parent to support a child becomes, by force of the legislation, a legal obligation reflected in a debt, calculated in accordance with the Assessment Act, owing by a parent to a carer of the child.[9]
[9] Luton v Lessels (2002) 210 CLR 333, 340 [6] (Gleeson CJ).
In my view, the terms, scope and purpose of the applicable legislation are central to the Court’s determination as to whether the relevant decision of the AAT can be one characterised as being vitiated by an error of law or is in some way legally unreasonable or otherwise illogical or capricious. The import of the legislation, at the subject of these proceedings is that parents should provide financial support, for their children, commensurate with their respective capacity to provide it.
In spite of the good intentions of this legislation, the application of the child support formula remains controversial amongst separated parents. In addition, the potential for human circumstances to throw up situations not regularly anticipated by the legislation in question for various reasons, remains infinite.
In these circumstances, the relevant legislative provisions contain mechanisms for the administrative assessments of child support to ameliorate the prospect of injustice or unfairness occurring in respect of the application of the child support formulae to either the situation of a liable or carer parent. In the jargon of the legislation, these are known as departure applications.
There are two main avenues, through which a person aggrieved by child support assessment may apply to depart from such an assessment – firstly, an administrative approach and secondly, one based on an application to an appropriate court.
In the present time, in 2018, the father objected to the administrative decision pertaining to him on three discrete grounds; whilst in her response, the mother also sought a departure on three other grounds provided by her.
In these circumstances, the provisions contained in Part 6A of the Assessment Act apply to each of the parties’ respective departure applications. The part of the Act is designated at Departure from Administrative Assessment of Child Support.
The pathway to be followed is delineated in section 98C and requires any decision-maker to be satisfied of three matters, which can be summarised as follows:
·One of the legislative criteria for departure has been established;
·It would be just and equitable, so far as the child, the liable parent, and the carer parent is concerned, to make a departure; and
·It would be otherwise proper to make such a departure.
The statutorily mandated grounds for departure are drawn from section 117(2) of the Assessment Act. They are summarised in the pro forma document provided by the CSA, which must be completed by any parent seeking a departure application. There are currently 11 relevant grounds, which can be summarised as follows:
Ground 1 The cost of spending time with the children more than 5% of the relevant parent’s adjusted taxable income Ground 2 The children concerned have special needs Ground 3 There are extra costs arising from the manner in which the children are being educated in a manner intended by their parents Ground 4 The children concerned have their own income, earning capacity, property and/or financial resources Ground 5 A parent has provided money, goods or property for the benefit of the children concerned Ground 6 A change in the costs of child care Ground 7 A parent has incurred out of the ordinary but necessary expenses in order to support him/herself Ground 8A The applicable assessment does not correctly reflect one or both parents income, property, and/or financial resources Ground 8B The assessment does not correctly reflect one or both parent’s earning capacity Ground 9 A parent has a duty to support another person Ground 10 A parent has a responsibility to support another child resident with him/her
In the current matter, the father has objected to the applicable child support assessment on the basis of grounds 2, 3 and 8A. The mother has cross-applied on the basis of grounds 1, 7 and 8A.
The legislative task set both for the Agency and then the Objections Officer and ultimately the AAT is as follows:
·Does one or more of the grounds for departure, referred to in subsection 117(2) of the Assessment Act arise; and if so
·Whether it would be just and equitable as regards to the children, the liable parent, and the carer entitled to child support;
·It is otherwise proper; to make a determination to depart from the administrative assessment of child support concerned.
The objection decision of 19 February 2019
The father indicated to the relevant Objections Officer that he had incurred $2,640.00 in respect of orthodontic treatment for X. The Objections Officer accepted that this was a special need pertaining to X and should be reflected in the relevant assessment.
The father also indicated that he had incurred private school fees of $8,537.00 in 2017 and $13,000.00 in 2018 in respect of the children attending private schools. In addition, it was his position that X had incurred substantial hobby fees in both 2017 and 2018 amounting to some $7,820.00.
It was the mother’s position that questioned how the father was able to meet what she regarded as exorbitant costs for private school fees and training on what was ostensibly a limited income and modest financial resources.
Ultimately, the Objections Officer considered that this ground was established in relation to the children’s private school fees but not in respect of X’s hobby costs.
The Objections Officer found that the mother’s relevant income, prior to her illness, was around $66,000.00. The mother provided evidence that she had visited the children on 25 occasions between 9 February 2018 and 27 January 2020 and had incurred costs of approximately $14,500.00 in so doing. In these circumstances, it was accepted that she had incurred significant costs in order to spend time with X and Y, which should be reflected in the relevant assessment.
In respect of the issue pertaining to the mother incurring out of the ordinary expenses, relating to her support, as a consequence of her July 2018 diagnosis of breast cancer, the mother provided the following evidence:
·Her specialist recommended that she have breast conservation surgery rather than a full mastectomy;
·This operation could only be performed by the relevant specialist in a private hospital as the mother lived outside the catchment area of the relevant public hospital in which the specialist operated;
·The mother had undertaken 6 weeks of daily radiation therapy and had sustained severe side effects which prolonged her anticipated recovery;
·She had utilised all her sick/annual leave entitlements and had been forced to take leave without pay from October 2018 onwards and was unable to return to work until mid-January 2019; and
·The mother had provided invoices in respect of the treatment received by her at the private hospital concerned.
The father did not accept that these were out of the ordinary expenses as, in his view, the mother’s condition was not immediately life threatening and, as such, it was not necessary for her to undergo treatment in a private hospital with a private surgeon attending.
Ultimately, the Objections Officer found the mother’s out of pocket medical costs to be just over $8,000.00 and the expenses concerned were incurred necessarily. As such, it was accepted that the mother’s medical costs were necessary and significantly impacted on her capacity to provide financial support for X and Y. As such, they were special circumstances, which could be taken into account in the assessment of child support.
The real weight of the Objections Officer’s consideration, as with the AAT, arose under the parties’ competing claims regarding the application of Ground 8A to their respective financial situations and competing assertions. In my view, before coming to the AAT decision, it is helpful to outline the evidence before the Objections Officer.
I do so in the light of the fact that the AAT found the father’s financial circumstances to be highly complex.
The Objections Officer made the following finding:
[The father] is entitled to arrange his financial affairs, as he consider appropriate and, in ways which may be legitimately tax effective. While [the father] is technically an employee of Employer C, he has previously been a director of Employer C and [the father’s business]. Information from the bank statements presented indicates he has access to business funds that may not be reflected in his personal taxable income. My review indicates [the father] has received payments directly and/or indirectly of around $44 170 rounded per annum ($88 339 divided by 2) from 24 December 2016 to 23 December 2018 from Employer C. According to paycalculator.com.au a net income of $44 170 equates to a gross income of around $53 500 which is similar to the 2017 income of $52 826 calculated by [the father] in his correspondence dated 2 January 2019.
Based on the above information I have established [the father’s] 2016-2017 ATI to be around $76 155 ($53 500 + $6109 + $48 + $3338 + $1430 + $11 730) for [the father] comprising of income/personal benefits from the family business, income support payments, dividends, franking credits, interest and trust distributions.
In the 2018 financial year, [the father] received income support payments totalling $2687 and interest and dividends totalling $8577. As at the date of this decision, there is no information available to determine if [the father] will receive any trust distributions from the family trust. Therefore, I estimate his 2017-18 ATI to be $64 764 based on income/personal benefits from his family business totalling $53 500, income support payments of $2687 and dividends/interest totalling $8577.
Reason 8A is established.
In respect of the mother, the Objections Officer found that the taxable income attributed to the mother by the Agency was accurate for the relevant periods and issues related to salary sacrifice packaging had been taken into account. As a consequence, the Objections Officer did not consider that Ground 8A had been made out in respect of the mother by the father.
The Objections Officer also considered that, as both of the parents had been through the departure process in both the Agency and on appeal on numerous occasions, each was fully aware of the importance of providing evidence to support assertions made.
Accordingly, at the end of the objection hearing process, issues relating to what benefits the father derived from his parent’s business and from the related share trading trust, including those arising from the distribution of franking credits, were clearly raised as significant issues between the parties. It is a trite observation, but true nonetheless, that the person who is most aware of the implications of his financial arrangements, particularly in the form of what is his recurrent income, is the father himself.
The hearing before the AAT
The hearing before the AAT took place on 25 July 2019. Both the father and mother attended the hearing and each provided oral evidence. I have been provided with a transcript of the proceedings, which occupies approximately 82 pages.
The mother’s position to the Tribunal, in regard to the Ground 8A aspects of the case, can be summarised as follows:
·She was baffled by the complexity surrounding the father’s financial situation;
·She perceived he moved sums between himself, the company and trust and various bank accounts to disguise profits;
·She did not accept that the father was a part-time employee of his parents’ company, but asserted that he ran and controlled it, including directing its profits; and
·The father’s assertions regarding his financial situation were not congruent with the lifestyle, which he and the children led, particularly in respect of what she regarded as very high school fees for Y and X, expensive orthodontic work for X, and what could be only regarded as very expensive hobby lessons for X.[10]
[10] See transcript of proceedings before the AAT of 25 July 2019 at [28].
It is apparent from reading the transcript of proceedings and examining the documents, which were provided by the parties to the Tribunal, that there was a plethora of financial documents provided by the father in respect of his business affairs. In addition, it is apparent that the father himself was given an opportunity to explain his financial situation to the Tribunal, at whatever length or in whatever degree of detail he wished.
The father’s stated position to the Tribunal, in regards to the Ground 8A aspects of the case, can be summarised as follows:
·The decision made by the Objections Officer included many errors of fact and of law;
·It has resulted in him paying the majority of the children’s costs, particularly in regard to education and special needs; and
·This was unfair and he looked to the Tribunal to increase the amount paid by the mother in child support.[11]
[11] Ibid at [8]-[9].
Thereafter, there was a lengthy dialogue between the father and the Tribunal regarding the latter’s financial situation. In particular, the father was asked about monies provided to him by his parent’s company and whether it was income. To which the father indicated that the money in question was available to him.[12]
[12] Ibid at [15].
Other questions were asked by the Tribunal about the financial documents produced by the relevant family trust for the year ending 30 June 2018, which reflected drawings of $1.3 million.[13] These discussions culminated in the member concerned asking the father how he could apparently afford $67,000.00 worth of expenses on his income as he had stated it.[14]
[13] Ibid at [19].
[14] Ibid at [26].
Towards the conclusion of the hearing, the presiding members asked each of the parties whether they considered that their income, property and financial resources had been comprehensively covered in the hearing, to which each replied in the affirmative.[15] In addition, at the conclusion of the hearing, each party was given an opportunity to make any further comment by the conclusion of the next week.[16]
[15] Ibid at [66].
[16] Ibid at [78].
The decision of the AAT
In its decision, the AAT, in my view, correctly summarised its administrative review task, as set by the Assessment Act, namely, whether special circumstances, as delineated by subsection 117(2) of the Act rendered it both just and equitable and otherwise proper to make a departure from the administrative assessment of child support.[17]
[17] See Tribunal decision dated 5 August 2019 at [13]-[21].
In particular, the Tribunal considered that one of the central issues in the case was whether the income, property or financial resources of either of the parties concerned had resulted in the applicable assessment of child support being unfair. Clearly, given the manner in which the mother had presented her case, this was the central evidentiary controversy arising.
In this context, the Tribunal indicated that there was no dispute that the father derived income from his involvement in the family company and his involvement in share trading through the related family trust. Thereafter, in my view, the Tribunal attempted to summarise the lengthy written submissions of the father and his oral evidence to it, as best it could. It did so over a number of pages and made a number of concessions, sought by the father.
Ultimately, the Tribunal concluded that loans made by the trust to the father should be considered a financial resource available to him, which was in addition to other forms of income earned by him through personal endeavour.[18]
[18] Ibid at [37].
At the end of its examination of the father’s financial affairs, the Tribunal reached the following conclusion, which in my view is central:
The Tribunal acknowledges that [the father’s] financial affairs are complex and that the true state of his finances is not fully evident from the consideration of his tax returns and the financial statements and tax returns of the company and the trust. Hence, it is difficult, if not almost impossible, for the Tribunal to exactly determine his income and financial resources given the resources the Tribunal do not include audit and accounting taxation specialists.[19]
[19] Ibid at [38].
In an earlier submission to the Objection’s Officer, the mother indicated her perception that the father bombarded decision makers with convoluted information, about his financial affairs, until he got what he wanted. It is not necessary for me to make any findings as to whether this is true or not, particularly whether it is a tactical device or otherwise, other than to say it is axiomatically the case that the father has written a number of lengthy and involved submissions to various decision makers.
In this context, the AAT, following it’s finding that the father’s financial affairs were largely impenetrable to it, made comment in regards to a letter the father had earlier sent to the CSA in August 2018. The Tribunal commented as follows:
The Tribunal notes in [the father’s] letter of 21 August 2018 that he suggested that in 2016/2017 an income for him of $71,500.00 to $76,500.00 would more fairly represent his true financial circumstances. The Tribunal accepts [the father’s] statement in this regard and finds that he has income and financial resources available to him of approximately $75,000.00 (allowing for some deductions) in the 2016/2017 year and also in the 2017/2018 and 2018/2019 years…[20]
[20] Ibid at [39].
Thereafter, the Tribunal undertook an analysis of the mother’s income in the relevant periods, including the periods when she was employed by Employer B and had access to salary sacrifice arrangements; the period when she was unemployed due to illness; and when she secured new employment in May 2019.
On the basis of this analysis, it was found that her adjustable taxable income, whilst employed by Employer B, had been $64,481.00 and this had reduced following her illness and subsequent treatment. These circumstances were accepted by the Tribunal as representing an unexpected eventuality, which rendered the applicable child support assessment unfair, in respect of that period.
The Tribunal also found that the mother’s expenditure on airfares relating to the children spending time with her from 1 September 2018 to 30 November 2019 exceeded 5% of her income and so were to be considered high. As such, the mother had established a ground for departure.
Thereafter, the Tribunal turned to consider the proper needs of the children concerned, particularly in terms of how their significant private education costs were being met and how X’s orthodontic treatment and hobby classes were being paid for. These considerations were relevant to the Tribunal’s assessment of what was just and equitable in the circumstances.
There was no controversy that in 2017, the children’s education and other costs amounted to $11,720.00; which had increased in 2018 to $21,333.00. It was anticipated that in 2019 the relevant amount would be $32,639.00 and in 2020 $33,550.00. Significantly, the Tribunal found that historically the father had paid the vast majority of these sums.
The Tribunal also found that the mother’s annual cost of travel, to spend time with the children, amounted to a sum of approximately $7,000.00, which she had met from her own resources. In this context, it was found that, from time to time, particularly whilst she had been suffering ill health, the mother’s recurrent expenses had exceeded her income.
As previously indicated, the Tribunal did not regard the calculation of the mother’s income as being complex, given the payslips and other information, which she had provided to it. The Tribunal also accepted that, at all relevant times, the mother had been fully exercising her income earning capacity.
In this context, the Tribunal accepted that it, in all the circumstances, it was reasonable for the mother to pursue the treatment recommended to her, for her cancer, in the private health sector. It found as follows:
The Tribunal accepts that when a person is diagnosed with a potentially life threatening illness that it is reasonable for the person to choose a doctor in whom they have confidence and to have the necessary surgery undertaken as soon as possible. The Tribunal is not persuaded that these expenses associated with [the mother’s] breast cancer diagnosis, surgery and treatment should be treated as subordinate to or less important than the education, hobby or orthodontic costs.[21]
[21] Ibid at [118].
Overall, the Tribunal found as follows, in respect of the parties’ expenses and earning capacity:
The Tribunal has established that [the father] had income and financial resources totalling approximately $75,000 in each of the 2016/2017, 2017/2018 and 2018/2019 years. Due to the franking credits which [the father] receives at tax time he effectively pays no tax. Ms Mayne had income and financial resources totalling approximately $75,971 in the 2016/2017 year; $64,841 in the 2017/2018 year and $44,700 in the 2018/2019 year.
In relation to their expenses both parents completed a Statement of Financial Circumstances. [The father] declared that his weekly expenditure for himself and the children in 2018 was approximately $1,500 or $78,000 per year. From March 2019 [the father] stated that his weekly expenditure was approximately $1,265 or $65,780 per year due to [the father] and the children moving into his parents' home rather than privately renting. He stated that instead of $425 in weekly rent, he was now paying his parents $200 per week for himself and the children and sharing some utility bills to the extent that rather than paying $30 per week for electricity, he was now paying approximately $20 per week. [The father] declared that his largest expense of $516 per week was for private schooling for the children. He declared hobby costs of $105 per week. He declared food expenses for himself and the children of $160 per week. His other household expenses were modest. At the time of the hearing [the father] stated that his credit card debt was approximately $8,000 and that this was due to his payment of school fees for the children. He did not state the minimum amount which he is required to pay each week.
The income/financial resources which the Tribunal has determined for [the father] are $75,000 per year, and he has declared total expenses in 2018 of approximately $78,000 (plus orthodontic expenses of $2,508) making total expenses of $80,508. His expenses clearly exceed his income in 2018 by approximately $5,500 per year. When the Tribunal asked [the father] how he managed to pay for the expenses on an even lower income which [the father] claimed he received, he advised (by way of explanation) that his income was supplemented by the rent assistance, family tax benefit and child support he had received (approximately $20,000 in total). Since early 2019 when [the father] and the children have been accommodated at his parents' home, the Tribunal finds that [the father’s] income of $75,000 exceeds the expenses claimed by approximately $10,159 (disregarding family tax benefit and child support)[22].
The Tribunal therefore finds that in the 2018/2019 year [the mother’s] expenses totalled approximately $58,568 and that her expenses exceeded her total net income of $42,300 (as detailed in paragraph 103) by approximately $16,268 (household and minimum credit card repayments $38,714 + $7,000 travel to care for the children+ $12,854 medical expenses)[23].
[22] Ibid at [94]-[96].
[23] Ibid at [121].
In conclusion, the Tribunal was required to carefully balance a number of competing considerations, to arrive at an outcome which it considered both just, equitable and otherwise proper. These factors included the following:
·The opacity regarding the father’s income and other aspects of his financial circumstances;
·The fact that the father paid the children’s significant educational expenses but given the parties’ had determined upon the children having a private education and X pursuing her interests, whilst the marital relationship between the parties was on foot, these expenses provided grounds for departure;
·The mother’s change of financial circumstances, due to her illness and the fact that her expenses had exceeded her income, from time to time;
·The high costs incurred by the mother of spending time with the children.
It was in these circumstances that the Tribunal elected to reconfigure the parties’ respective levels of adjusted taxable income for the years in question, which would have concomitant implications for the amount of child support to be paid by the mother to the father.
In this context, the Tribunal acknowledged that its proposed outcome would leave the father paying for the majority of the children’s expenses but, at the same time, it was satisfied that due to the multitude of unfortunate factors that had affected the mother’s financial circumstances in the 2018/2019 year, she did not have the capacity to contribute further.
In summary, the Tribunal indicated as follows:
The Tribunal acknowledges that this is a complex case, however, the Tribunal considers this proposed termination is fair, just and equitable and that it balances the needs and financial capacities of both parents.[24]
[24] Ibid at [141].
Finally, the Tribunal considered that the manner in which it had elected to apportion the children’s various financial needs, between the parties, in the overall circumstances of the case concerned, could be considered to be proper, bearing in mind the prime objective of the relevant legislation was that parents should be obliged to support their children to the extent of their real capacity to do so.
In my view, in difficult circumstances, the Tribunal endeavoured to assess, as best it could, what were the proper needs of the two children concerned and the capacity of the parents concerned to supply those needs. To my mind, the Tribunal acquitted this task in a diligent and comprehensive manner, bearing in mind the respective evidence provided by each of the parties concerned.
THE NATURE OF A JUDICIAL REVIEW HEARING
Pursuant to the provisions of section 44AAA of the Administrative Appeals Tribunal Act 1975 (Cth) (‘the AAT Act’), a party to the proceedings before the AAT may appeal to this Court in respect of a decision made by the AAT in a child support matter. These proceedings can be characterised as a ‘child support first review’.[25] However, the only ground on which an appeal can be based is on a question of law.
[25] Defined by section 3 of the AAT Act as meaning a proceeding that is an application in the social services and child support division of the AAT for first review as provided by Part VIIIA of the Child Support (Registration & Collection) Act 1988 (Cth).
It is outside the scope of my jurisdiction to make findings of fact, or remake the decision of the Tribunal — this lies at the heart of a merits review. The Court, when conducting a judicial review, is concerned with the procedural, rather than the substantive content of proceedings.[26] It is not within the jurisdiction of a court, who is undertaking a review of a decision, to exercise the function of a merits review, this would be outside of the scope of judicial decision making.[27] Mason J noted in Minister for Aboriginal Affairs v Peko-Wallsend Pty Ltd:
The limited role of a court reviewing the exercise of an administrative discretion must constantly be borne in mind. It is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator. Its role is to set limits on the exercise of that discretion and a decision made within those boundaries cannot be impugned.[28]
[26]Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, 71-2 (Dawson J).
[27] See generally Re Kirby; Ex Parte Boilermakers’ Society of Australia (1956) 94 CLR 254.
[28] Minister for Aboriginal Affairs v Peko-Wallsend Pty Ltd (1986) 162 CLR 24, 40 (Mason J).
The substantive decision in this case can be characterised as being a child support first review. This type of appeal is open to this Court in respect of errors or issues relating to questions surrounding the application of the law.
In Collector of Customs v Pressure Tanker Pty LtdandPazzolanic Enterprises Pty Ltd,[29] the Full Court of the Federal Court characterised the nature of an appeal from the AAT, which is restricted to a question of law, from a fact finding and decision making tribunal as follows:
[T]he nature of the task of this court is clear. It is to leave to the tribunal of fact decisions as to the facts and to interfere only when the identified error is one of law.[30]
[29] Collector of Customs v Pressure Tankers Pty Ltd and Pozzolanic Enterprise Pty Ltd (1993) 43 FCR 280.
[30] Ibid 286-7 (Neaves, French and Cooper JJ).
An administrative tribunal exceeds its powers and commits a jurisdictional error, which is correctable on appeal in respect of a question of law, if it:
•fails to construe properly the legislative provisions applicable;
•identifies the wrong issues or asks itself the wrong questions;
•ignores relevant material or relies on irrelevant material;
•fails to accord procedural fairness to the party before it or otherwise breaches principles of natural justice;
•makes an erroneous finding of such a magnitude that it goes to the very jurisdiction which it purports to exercise rendering its decision perverse or unreasonable or otherwise offending logic.[31]
[31] See Apthorpe v Repatriation Commission (1987) 13 ALD 656, 666 (Davies, Lockhart and Gummow JJ).
The classical definition of jurisdictional error was provided by the High Court in Minister for Immigration & Multicultural Affairs v Yusuf.[32] It described an error, which leads to the vitiation of the jurisdiction of an administrative body, in the following terms:
What is important, however, is that identifying a wrong issue, asking a wrong question, ignoring relevant material or relying on irrelevant material in a way that affects the exercise of power is to make an error of law. Further, doing so results in the decision-maker exceeding the authority or powers given by the relevant statute. In other words, if an error of those types is made, the decision-maker did not have authority to make the decision that was made; he or she did not have jurisdiction to make it.[33]
[32] Minister for Immigration & Multicultural Affairs v Yusuf (2001) 206 CLR 323.
[33] Ibid 351 [82] (McHugh, Gummow and Hayne JJ).
Accordingly, it is the function of this Court to determine whether the decision of the AAT was within its jurisdiction. That is what is meant by a question of law. As outlined before, it is not the function of this Court to examine the merits of that decision, if the decision was made within the parameters of its jurisdiction. Essentially, it is not the function of this Court to reappraise the evidence led before the AAT and re-determine the case, according to the conclusions it draws from the evidence available to the Tribunal.
As such, I should be cautious when reviewing the decision of the AAT and not approach it with ‘an eye [which is] too keenly attuned to perception of error [or to read it] over-finely’.[34]Rather I should take a common sense approach to the AAT’s decision, and the reasons that were provided. The function of the AAT is not to produce reasons of ‘jurisprudential excellence’.[35] It is to provide an informal and expedient level of independent review.
[34] See Htun v Minister for Immigration & Multicultural Affairs (2001) 233 FCR 136, 151 [36] (Allsop J).
[35] See LDME & JMA (SSAT Appeal) (2007) 38 Fam LR 132, 138 [34] (Halligan FM).
In Child Support Registrar & Crabbe and Anor,[36] the Full Court of the Family Court provided a summary of principles (and applicable authorities), which are relevant to the review of administrative decisions relating to child support, particularly what matters can constitute an error of law and those which do not. I have attempted to encapsulate them as follows:
•The question of whether there is evidence to support a finding of fact or an inference drawn from a finding of fact is a question of law;
•The making of a finding of fact or the drawing of an inference, in the absence of evidence, is an error of law;
•However, a wrong finding of fact is not necessarily an error of law, if it was based on evidence available to the decision maker;
•As a consequence, a finding of fact based on a faulty process of reasoning is not an error of law;[37]
•Judicial review is not to be over zealous in seeking to find inadequacy or reasoning and so inadvertently turn judicial review of an administrative decision maker into a reconsideration of the merits of the relevant decision;[38]
•An administrative tribunal is required to do no more than set out the findings which it did make on facts which it considered material to the decision made.[39]
[36] Child Support Registrar & Crabbe and Anor [2014] FamCAFC 10 at [54] (Bryant CJ, Finn and Kent JJ).
[37] See Minister for Immigration & Multicultural Affairs v Al Miahi (2001) 65 ALD 141, 149 [34] (Sundberg, Emmett and Finkelstein JJ).
[38] See Minister for Immigration & Ethnic Affairs v Wu Shan Ling [1996] 185 CLR 259, 271 (Brennan CJ, Toohey, McHugh and Gummow JJ).
[39] Minister for Immigration & Multicultural Affairs v Yusuf (supra) at [69] (McHugh, Gummow and Hayne JJ).
Although the proceedings before the AAT are inquisitorial in nature, it is not the function of the Tribunal to make out the case for or on behalf any party concerned. In the context of such administrative decision making the High Court has indicated that the Tribunal has an inquisitorial function but this does not impose upon it:
A general duty to undertake its own inquiries in addition to information provided to it by the applicant.[40]
[40] See Minister for Immigration & Citizenship v SZIAI & Anor (2009) 259 ALR 429, 431 [1] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ).
One of the central fact finding tasks of the Tribunal was to determine what was each party’s child support income on which to base a just and equitable assessment of child support. In other words, this was the jurisdictional task set for the Tribunal.
As I have already indicated, the individuals’ best placed to provide evidence regarding their respective financial circumstances are the parties themselves. As the Tribunal noted, the father’s financial affairs are complex. This level of complexity did not abrogate the Tribunal’s obligation, as best it could, to make the findings it was required to make nor did it obviate the father’s responsibility to provide comprehensive and understandable information about his financial affairs.
The onus remains on the father to establish to the AAT that the decision from which departure was sought was not reflective of his financial circumstances. Throughout this inquiry processes to adopt the terminology utilised by Slack FM, the parties are subject to an immutable obligation:
•to assist the enquiry by providing reliable and truthful evidence about their financial circumstances;
•to provide evidence of their financial circumstances in a manner that can be readily understood;
•to make full disclosure of all relevant documents that can assist the enquiry to make a determination and that includes disclosing documents (subject to a claim in privilege) that may have an adverse impact on their case.[41]
[41] Thomas & Harry (SSAT Appeal) [2010] FMCAfam 310 at [26] (Slack FM).
In earlier case, Humphries & Berry (SSAT Appeal),[42] Slack FM was dealing with an appellant in a child support review hearing, whom His Honour found not to have provided sufficient clarity about his financial affairs. He opined as follows:
The appellant was well aware that in the hearing the essential issue and controversy was his income and/or earning capacity [and] that he had ample opportunity over the course of the way the matter being conducted to produce cogent and concise evidence about his financial circumstances and in particular about his income.[43]
[42] Humphries & Berry (SSAT Appeal) [2008] FMCAfam 409.
[43] Ibid [32] (Slack FM).
Consequently, where it is the case that information and financial records cannot be ‘reasonably and readily understood and examined’, and where a person’s financial affairs are a ‘significant subject of enquiry before the Tribunal’,[44] the Tribunal is granted some discretion to make inferences from other resources.
[44] Ibid [27]-[28].
However, this discretion is not without limits, and it should be noted that:
The real issue is whether or not there is sufficient evidentiary foundation to draw an inference as to his income or earning capacity or other resources, in the manner suggested … It is clear that the failure to make comprehensive disclosure, of itself, does not create evidence of a particular income or earning capacity. The failure to make full and frank disclosure or provide evidence properly explaining financial affairs allows the Court to accept what evidence there may be with more confidence than would otherwise have been the case.[45]
[45] Thomas & Harry (SSAT Appeal) [2010] FMCAfam 310 [3], citing S & D [2005] FMCAfam 446 [65] (Riethmuller FM).
In my view, it is in these comments are apposite the central evidentiary finding made by the AAT, which the father seeks to challenge as an error of law, namely his income, for child support purposes, was around $75,000.00.
THE APPLICANT’S GROUNDS OF REVIEW
The applicant is aggrieved by the outcome of the proceedings before the AAT. He seeks, on review before this Court that his review be upheld, the relevant decision be set aside, and the matter be remitted to the AAT for rehearing by a differently constituted Tribunal. The applicant is also seeking an order for costs incurred during these proceedings.[46]
[46] See the Consolidated Notice of Appeal filed by the Applicant dated 21 September 2020.
It is difficult to make sense of the applicant’s Notice of Appeal filed in these proceedings and the grounds of appeal stated therein. I will attempt to decipher the 12 grounds of review in these reasons and summarise them as best I can. The applicant appeals on the basis that:
·the Tribunal treated the applicant’s loan totalling $35,587.00 as a financial resource (‘ground 1’);
·the AAT erred in determining that the applicant’s adjusted taxable income for the 2016/2017 and the 2017/2018 financial years to be $75,000.00 (‘grounds 2 and 4’);
·the Tribunal incorrectly considered the applicant’s loan of $35,587.00 and his tax returns to the Australian Taxation Office (‘ATO’) of approximately $41,000.00 when determining the applicant’s adjusted taxable income, and as a result, this money has been ‘double counted’ in determining the applicant’s income (‘ground 3’);
·the AAT erred in making a statement that the applicant ‘effectively pays no tax’ (‘ground 5’);
·the Tribunal made an incorrect finding in calculating the applicant’s expenses during 2018 to be $78,000.00 (‘ground 6’);
·the AAT erred in determining the first respondent’s expenses and income for the periods 2016/2017, 2017/2018, 2018/2019 financial years and for the period of 1 July 2019 to 31 December 2020 (‘grounds 7, 8 and 9’);
·the AAT misapplied section 117 of the Assessment Act to establish the first respondent’s high cost of travel, and the capacity to support herself (‘ground 10’);
·the Tribunal erred in not backdating its determination before 1 July 2017 (‘ground 11’); and
·the AAT failed to notify the applicant that a potential overpayment may occur as a result of its determination (‘ground 12’).[47]
[47] Ibid.
The applicant alleges that there are numerous errors of law in the above grounds of review. It is essentially his position, among other things, that there has been a failure to accord natural justice and procedural fairness; that the AAT failed to consider relevant material or considered irrelevant material; that the decision constitutes jurisdictional error; that adequate reasons were not provided; and that the AAT’s determination was unreasonable.[48]
[48] Ibid.
Ground one
This ground seems to be an assertion by the father that the Tribunal did not ensure the hearing had the prerequisite degree of procedural fairness in that it did not allow him to comment or present evidence before reaching a conclusion that a loan made by the family trust to him was a financial resource.
The father complains that he was not called upon, by the Tribunal to comment upon a letter from his (and his parents’) accountant, Mr D, which stated that he had been given a loan of $35,587.00 by the family trust in the 2017/18 financial year.[49]
[49] See Tribunal decision dated 5 August 2019 at [37] and Tribunal Document Bundle at p 87.
This issue, in my view, must be considered in the light of the overall finding of the Tribunal that the father’s financial affairs were complex and it itself did not have the resources to conduct an audit of them. The document itself related to the father and his financial affairs and had been produced by his accountant.
As earlier observed, it is not the function of the Tribunal to put an applicant’s case for him or her or indeed provide any indication as to its thought processes, as a hearing unfolds before it. As the High Court observed in SZBEL v Minister for Immigration & Multicultural & Indigenous Affairs:
Procedural fairness does not require the Tribunal to give an applicant a running commentary upon what it thinks about the evidence that is given. On the contrary, to adopt such a course would be likely to run a serious risk of conveying an impression of pre-judgment.[50]
[50] See SZBEL v Minister for Immigration & Multicultural & Indigenous Affairs (2006) 228 CLR 152 [48] (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ).
In my view, the father clearly knew the case which he was expected to meet before the Tribunal. The mother had raised ground 8A and consistently asserted that she did not accept the father’s account of what was the extent of his access to financial resources supplied to him by the Family trust and therefore she did not consider that the applicable assessment was properly reflective of his financial circumstances. This was not a new issue and as such, I do not think that it can be said that any failure on the Tribunal’s part to specifically ask him to comment on a letter from his own accountant was procedurally unfair.
The emphasis placed on the nature of a judicial review is on what is a fair hearing, not on what is a fair outcome, particularly not what is fair in the perception of the person affected by the decision in question. Again to refer to SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs:
It is, therefore, not to the point to ask whether the Tribunal’s factual conclusions were right. The relevant question is about the Tribunal’s processes, not its actual decision.[51]
[51] Ibid 160 [25] (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ).
I do not consider that the applicant has established this ground of appeal.
Grounds two, three, four, six and seven
These grounds are inter-related and, in my view, can be dealt with together. The father objects to the Tribunal’s central finding in the case that his income and financial resources, for child support purposes, should be $75,000.00 per year. As I understand, his somewhat convoluted and repetitive submissions, it is that there is no evidence to ground such a finding or in the alternative the finding is illogical or otherwise legally unreasonable.
The father seems to be particularly critical in respect to findings relating to the following issues:
·His income/financial resources included access to franking credits;
·Its treatment of expenses claimed by him, including accountancy fees, motor vehicle expenses and net investment losses;
·Loans made to him by the Trust;
·His overall income and expenditure.
What is clear to me is that over an extended period of time, the father was given an ample opportunity to addresses these issues and indeed provided lengthy submissions in respect of them. In addition, he was given the opportunity before the Tribunal itself to make any oral submission, which he wished to make. Essentially, the applicant was given ample opportunity, in my view, to throw whatever light he wished onto his complex financial affairs.
In such circumstances, in my view, it now not open to him to assert either that the hearing itself was procedurally unfair or that, in the absence of any comprehensive explanation or evidence from him, the Tribunal’s findings are vitiated by unreasonableness, illogicality, caprice or any other species of jurisdictional error. Rather, it seems to me that the Tribunal did its best to acquit the jurisdictional task bestowed on it. This was in respect of the evidence led before it, and provided by both the father and the mother.
The mother’s case was consistent throughout. She asserted that she did not understand how the father could make the payments which he did in respect of the children whilst asserting he had no income. The onus was on the husband to dispel this assertion in circumstances in which he was under an obligation to provide a full and frank disclosure of his financial affairs. The father asserted that his income was modest.
This was the evidentiary issue about which the Tribunal was required to make a factual finding. It could not decline to make a finding, on the basis that of the opacity of the evidence before it as this would have been fundamentally unfair to the mother. Rather the Tribunal had to do its best to grapple with the evidence within the context of the situation that the applicant himself was best placed to piece the clouds of opacity before it and had been given an ample opportunity to do so.
In Re Minister for Immigration & Multicultural Affairs: Ex parte Lam, Gleeson CJ referred to a concept which he encapsulated as practical injustice. He characterised it as follows:
Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.[52]
[52] Re Minister for Immigration & Multicultural Affairs: Ex parte Lam (2003) 214 CLR 1, 14 [37] (Gleeson CJ).
In my view, such a concept is relevant to the present matter, which can be characterised as being centrally an administrative inquiry into what were the financial resources available to the father in his idiosyncratic and complex circumstances. As I have said, the father knew the nature of AAT’s function and it was open to him to provide whatever assistance he could to facilitate it. As such, I do not think he has been the subject of any such practical injustice given his capacity to provide information about his affairs.
The applicant now asserts that the Tribunal’s findings were wrong. I am not in a position to conclude so and in any event it is not my responsibility to substitute my own findings for those of the Tribunal. I accept the father is of the view that the decision in question is wrong but that of itself does not establish a jurisdictional error. As Gleeson CJ pointed out in Re Minister for Immigration & Multicultural Affairs: Ex Parte Applicant S20/2002:
To describe reasoning as illogical, or unreasonable or irrational, may merely be an emphatic way of expressing disagreement with it. If it is suggested that there is a legal consequence, it may be necessary to be more precise as to the nature and quality of the error attributed to the decision maker, and to identify the legal principal or statutory provision that attracts the suggested consequence.[53]
[53] Re Minister for Immigration & Multicultural Affairs: Ex Parte Applicant S20/2002 (2003) 198 ALR 59, 61 [5].
In addition to asserting that the relevant decision is factually wrong, it also appears to be the applicant’s case that the decision is legally unreasonable in some way, either on the basis that it is intellectually flawed, or otherwise can be subject to criticism on the basis that it is capricious or in some other way not a proper exercise of the jurisdiction conferred on the AAT.
Binding High Court authority indicates that it is an inherent requirement of the exercise of any power, conferred on an administrative decision maker, such as the AAT, that such power be exercised reasonably and, if it is not so exercised, it amounts to a failure of jurisdiction. To be exercised reasonably, it must be possible to glean from the relevant decision record an “an evident and intelligible justification” for the pertinent decision in question.[54]
[54] See Minister for Immigration & Citizenship v Li (2013) 249 CLR 332, 367 [75]-[76] (Hayne, Kiefel and Bell JJ).
In Minister for Immigration & Citizenship v Li (‘Li’), Gageler J expressed the principle as follows:
Implication of reasonableness as a condition of the exercise of a discretionary power conferred by statute is no different from implication of reasonableness as a condition of an opinion or state of satisfaction required by statute as a prerequisite to an exercise of a statutory power or performance of a statutory duty. Each is a manifestation of the general and deeply rooted common law principle of construction that such decision-making authority as is conferred by statute must be exercised according to law and to reason within limits set by the subject-matter, scope and purposes of the statute.[55]
[55] Ibid 370 [90].
Again in Li, Gageler J considered that the authority conferred on a decision-maker by statute was subject to the deeply rooted common law principle that such authority be exercised both according to law and reason. In the case, under the heading Judging Unreasonableness His Honour said as follows:
Review by a court of the reasonableness of a decision made by another repository of power ‘is concerned mostly with the existence of justification, transparency and intelligibility within the decision-making process’ but also with ‘whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law’.[56]
[56] Ibid 375 [105].
Essentially, an administrative decision maker is required to provide an intelligible and reasonable explanation as to why a particular decision has been reached – in this case whether or not the applicant was a refugee because he had a well-founded fear of persecution, if returned to India, on the basis that there was a real chance he might suffer serious harm there.
Following Li, the Full Court provided further analysis of the concept of legal unreasonableness in Minister for Immigration & Border Protection v Singh.[57] This case identified two distinct but related species of unreasonableness – one based on errors arising in the decision making process itself and the other based on what was the actual outcome of the decision making process.
[57] Minister for Immigration & Border Protection v Singh (2003) 231 FCR 437, 446 [47] (Allsop CJ, Robertson and Mortimer JJ).
In the first, the Court, in its supervisory role on judicial review, is able to identify a jurisdictional error in how the decision maker has approached the statutory task conferred upon it. In the second, being outcome focussed, the reviewing court is satisfied that the exercise of power, by the original decision maker is arbitrary, capricious or outside the range of possible, acceptable outcomes which are defensible in respect of the facts and law.
It is also clear from relevant Federal Court authority that the level of illogicality or unreasonableness necessary to have found jurisdictional error must be “extreme” not merely a situation where the minds of potential decision makers might differ as to the issue in question.[58] In Minister for Immigration & Citizenship v SZMDS, Crennan and Bell JJ said as follows in respect of how a court, conducting a judicial review of a primary decision maker’s determination is to assess whether the relevant decision is to be characterised as being irrational or illogical. Their Honours said as follows:
Whilst there may be varieties of illogicality and irrationality, a decision will not be illogical or irrational if there is room for a logical or rational person to reach the same decision on the material before the decision maker. A decision might be said to be illogical or irrational if only one conclusion is open on the evidence, and the decision maker does not come to that conclusion, or if the decision to which the decision maker came was simply not open on the evidence or if there is no logical connection between the evidence and the inferences or conclusions drawn.[59]
[58] See Minister for Immigration and Citizenship v SZRKT (2013) 212 FCR 99, 137 (148) (Robertson J).
[59] Minister for Immigration & Citizenship v SZMDS (2010) 240 CLR 611 at 649 [135] (Crennan and Bell JJ).
In other cases, it has been recognised there may be a range of possible outcomes available to any particular decision maker within the jurisdiction conferred. There will be no error of jurisdiction if the ultimate decision falls within the relevant range. Whether a decision is within jurisdiction is not a matter which can closely prescribed. It is a matter of characterisation rather than definition.[60]As such, the starting point in respect of whether the discretion, which is the focus of the review ground, was exercised in a legally reasonable manner is to examine firstly the terms, scope and purpose of the applicable statutory power before turning to consider whether there has been a failure to exercise the relevant power in a manner which can be characterised as being legally unreasonable.[61]
[60] Minister for Immigration & Border Protection v Stretton (2016) 237 FCR 1 at [11] (Allsop CJ).
[61] See CCQ17 v Minister for Immigration & Border Protection [2018] FCA 1641 at [51] (Thawley J).
The discretion vested in the AAT, in the current matter, arose under the provisions of the Assessment Act. The principle statutory object of which is to ensure that children receive a proper level of financial support from their parents. In association with this objective, is the task of determining the capacity of each such parent to provide financial support.
This jurisdictional task arises in a context in which parents are under a general obligation to provide sufficient information regarding their affairs to enable the decision-maker to determine their respective level of such capacity. It is in this context that the Court must examine the father’s contention that the Tribunal’s finding that his income/financial resources, taking into account issues relating to franking credits, trust loans and the like, was vitiated by illogicality or some other species of legal unreasonableness.
As the High Court pointed out in Minister for Immigration & Border Protection v SZVFW (‘SZVFW’),[62] a decision is either legally unreasonable or it is not. The distinction is absolute and therefore axiomatic. A decision cannot be slightly illogical or another conclusion more logical. Whether a decision is either legally illogical or logical must depend on an analysis of the facts, within the statutory context applicable.
[62] See Minister for Immigration & Border Protection v SZVFW (2018) 264 CLR 541.
It is an essentially precursor to the legal exercise of any statutory power that it is exercised reasonably. In SZVFW, Nettle & Gordon JJ analysed the task, set for a court such as this one when conducting a judicial review, and in determining whether a particular decision was beyond power because it was legally unreasonable. The task requires the Court:
·To assess the quality of the administrative decision having regards to the scope, purpose and objects of the statutory source of power;
·This question involves consideration of whether a statutory power has been abused by the decision maker;
·The manifestation of abuse cannot be definitively categorised. It is not limited to:
·a decision maker taking into account an irrelevant consideration;
·failed to take into account a relevant consideration;
·the exercise of a power in bad faith; or
·cases which may be described as manifestly unreasonable.
·It is an exercise which focuses on the existence of justification, transparency and intelligibility within the decision-making process, which are defensible in respect of the facts and law;
·It is invariably fact dependent and therefore requires a careful evaluation of the evidence.
Specifically, in SZVFW Nettle & Gordon JJ said as follows:
[L]egal unreasonableness is invariably fact dependent and requires a careful evaluation of the evidence. That is, assessment of whether a decision was beyond power because it was legally unreasonable depends on the application of the relevant principles to the particular factual circumstances of the case, rather than by way of an analysis of factual similarities or differences between individual cases. Where reasons are provided, they will be a focal point for that assessment. It would be a rare case to find that the exercise of a discretionary power was unreasonable where the reasons demonstrated a justification for that exercise of power.[63]
[63] Ibid 574 [84] (Nettle and Gordon JJ).
In this case, the AAT provided lengthy reasons and, in a difficult situation in which the father had provided a mass of information, which it found complex and ill-defined. In these circumstances, it applied itself to the jurisdictional task set for it, namely assessing the father’s financial situation.
In my view, given the statutory framework, the Tribunal acquitted its jurisdiction reasonably and provided a sufficiently logical set of reasons as to why it reached the particular conclusions which it did. It made findings regarding the existence of grounds for departure and then, in the context of what was just and equitable and otherwise proper, made findings regarding each parties’ capacity to provide financial support for their children.
The fact that the father now disagrees with its conclusions or the fact that another decision-maker may have reached a different conclusion, does not establish legal error. The Tribunal correctly followed the task set for it by section 98C of the Assessment Act.
In addition, in my view, the Tribunal’s conclusions must be examined within the context of the obligations residing on the applicant to explain his financial circumstances in a logical and coherent manner. It is not for the AAT to make his case for him or, in some way, intuit what it is. In this context, I am satisfied that it cannot be said that the overall hearing was, in some manner, procedurally unfair. I am satisfied that the applicant was fully aware of what were the salient issues arising in the case and was given an ample opportunity to make whatever submissions or provide whatever evidence he wished to.
In these circumstances, I do not consider that any of these grounds of appeal have been established. I do not consider that the conclusion that the father’s income or financial resources, for child support purposes, is to be considered to be around $75,000.00 can be characterised as perverse, capricious, illogical or otherwise an abuse of process to be made out.
Ground five
In ground five, the applicant complains that the Tribunal made a finding that he pays no tax. Counsel for the Registrar, Mr Bishop, contends that the actual finding of the Tribunal was that the father, due to franking credits, effectively pays no tax, which he submits was a finding open to it.
I agree with this contention. In addition, even if it is not factually correct, it does not affect the overall validity of the Tribunal’s findings regarding what was a just and equitable and otherwise proper level of child support, given the establishment of a ground of departure and the fact that it followed the pathway provided by section 98C.
Grounds eight, nine, ten & eleven
These grounds seem to be inter-related. The applicant contends that the AAT did not give adequate reasons as to:
·how it quantified the mother’s expenses and proper needs for 2017/18;
·why it found the mother’s expenses, at relevant times, exceeded her income and did not properly take into account board received from her step son for 2018/19;
·how it quantified the mother’s expenses for 1 July 2019 to 31 December 2020;
·how it found that the mother had high costs of travel and expenses related to self-support; and
·erred in deciding to commenced its determination from 1 July 2017.
As with other aspects of the appeal, it is difficult to isolate what is said to be the legal error relating to these various grounds of appeal other than the father disagrees with the findings made by the Tribunal in regard to them.
A fair reading of the Tribunal’s decision indicates that some eleven closely written paragraphs were focussed on the mother’s financial situation, which had none of the complexity surrounding the financial circumstances of the father. In addition, the Tribunal spent a significant portion of its reasoning directed towards an analysis of what was a just and equitable departure, given its satisfaction that grounds for departure had been established.
The father takes issue with the Tribunal’s findings regarding the mother’s cancer treatment asserting that there was no evidence to support its finding that she had a life threatening condition or required immediate treatment. Again, the father is free to disagree with the findings of the Tribunal in respect of these matters but, in my view, the findings made by the AAT, in respect of these issues, were axiomatically open to it and it would represent impermissible merits review for this Court to substitute its findings for those of the Tribunal.
He also takes issue with the Tribunal’s findings regarding the mother’s income, expenditure and in respect of issues to do with changes in employment. As indicated above, it is for the AAT to make any necessary findings of fact in respect of these issues, not for this Court. As such any asserted error of reasoning, on the Tribunal’s part, must be extreme to warrant court intervention on grounds of illogicality or unreasonableness.
The Tribunal had access to the mother’s tax returns and a financial statement completed by her. She produced pay slips. It also received oral evidence from her, in which she stated her employment situation had changed and her hours reduced. Finally, she produced invoices in respect of the air travel paid for by her relating to the children spending time with her.
Necessarily, the Tribunal accepted that it had sufficient evidence, from the mother, to ascertain what were her financial circumstances and the implications of those in respect of time spending arrangements. It was for the AAT to make any necessary findings of fact in respect of those issues, which in my view, it patently did and did so in a procedurally fair manner, in which both parties provided evidence and were given an opportunity to make submissions.
As Halligan FM observed in to LDME & JMA (SSAT Appeal),[64] courts, such as this one, should recognise the burdens lying on an administrative fact finder, such as the AAT. He said as follows:
The [Administrative Appeals Tribunal] is an administrative tribunal, not a Court of law, and is bound to pursue the objective of providing a mechanism of review that is fair, just, economical, informal and quick … It is not afforded the luxury of lengthy deliberation on the reasons for its decisions … The function of the [Administrative Appeals Tribunal] is not to deliver judgments of jurisprudential excellence when delivering its reasons. In my view … the court reviewing the reasons for decision of the [Administrative Appeals Tribunal] in such an appeal to discern legal error should not adopt an overly pedantic approach.[65]
[64] LDME & JMA (SSAT Appeal) (2007) 38 Fam LR 132.
[65] Ibid 138 [34] (Halligan FM).
In my view, the AAT in the present matter acquitted the jurisdiction task conferred upon to assess the mother’s financial capacity to provide support for the children in a fair and logical manner and assessed what was the relationship of this to the costs incurred by her in respect of spending time with X and Y. In these circumstances, I propose to dismiss each of these grounds of appeal.
Ground 12
The specific ground of appeal reads as follows:
On the whole, the applicant submits the Tribunal’s decision is unsustainable as it goes to jurisdictional error of law, not just error of law which would otherwise not affect the decision. In other words, in applying the provisions of s. 103X in may produce a different result.[66]
[66] See the Consolidated Notice of Appeal filed by the Applicant dated 21 September 2020 at page 11.
As with other aspects of the appeal, this represents an inchoate assertion, on the applicant’s part, that there has been an error of law commitment by the AAT. On its face, I am not sure what this ground is. However, in his lengthy written submissions, the father makes a complaint that it was unfair to him for the departure application to be backdated to 1 July 2017.
In these circumstances, Mr Bishop, in his written submissions assumed that this ground related to a complaint by the father that it represented a breach of procedural fairness for him to have been deprived of the opportunity to make submissions on this issue because of potential financial hardship arising to him from the back dating in question.
In this context, Mr Bishop relies on what was said by the Full Court in Child Support Registrar & Pearce & Anor (SSAT Appeal),[67] namely that an overpayment, following a departure application was “nothing more than the inevitable consequence of a regime that allows for review of administrative decisions”. I agree that the AAT was not required, in order to provide procedural fairness to the parties, to advise either of them of potential overpayment implications of any decision which it made. This ground is not made out.
[67] Child Support Registrar & Pearce & Anor (SSAT Appeal) [2018] FamCAFC 10 at [28]-[29] (Thackray, Aldridge and Watts JJ).
CONCLUSIONS
The difficulty arising in this case is easily stated. The father is clearly aggrieved at many aspects of the merits review conducted by the AAT. In this context, he has taken exception to many factual findings made by the Tribunal. The father is not legally qualified and has done his best to identify errors, which he asserts enliven the jurisdiction of this Court.
His amended appeal and his written submissions are each lengthy documents, which are difficult to follow. I do not consider that the father has articulated any error of law in the relevant decision of the AAT. This Court is not permitted to engage in a merits review. Its jurisdiction arises only if there is a legal error substantiated.
The weight to be given to particular aspects of the evidence led before it that centres on the parties’ respective financial circumstances, and their capacity to pay child support for the two children concerned was a matter for the AAT and lies at the heart of merits review. I am satisfied that the AAT, did conduct such a merits review in a legally reasonable way both in the fashion in which it reached its conclusions, and in the procedural manner in which it conducted the hearing before it.
As such, the father has identified no legal error and therefore the appeal should be dismissed. The Registrar seeks costs in an amount of $7,200.00, which it has calculated pursuant to the relevant schedule attached to the Court’s Rules.
These proceedings were commenced pursuant to the provision of section 44AAA of the Administrative Appeals Tribunal Act 1975. Accordingly, pursuant to the definition provided by section 7 of the Federal Circuit & Family Court of Australia Act 2021 (Cth) they are not family law or child support proceedings.
In these circumstances, the legal provisions relating to costs under section 117 of the Family Law Act 1975 (Cth), section 100 of the Assessment Act, and section 105 of the Collection Act do not apply. Rather the issue of costs is governed by section 214 of the Federal Circuit & Family Court of Australia Act 2021 (Cth), the relevant subsections of which provides as follows:
(2) The Federal Circuit and Family Court of Australia (Division 2) or a Judge has jurisdiction to award costs in all proceedings before the Court (including proceedings dismissed for want of jurisdiction) other than proceedings in respect of which any other Act provides that costs must not be awarded.
(3) Except as provided by the Rules of Court or any other Act, the award of costs is in the discretion of the Federal Circuit and Family Court of Australia (Division 2) or Judge.
This section replicates section 79(2) and (3) of the Federal Circuit Court of Australia Act 1999 (Cth) which it replaces. The Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (“the Rules”) provides the Court with a broad discretion as to costs and the manner of their calculation.
Pursuant to rule 22.02 of the Rules the Court may:
•Set the amount of the costs;
•Set the method by which the costs to be calculated;
•Refer the costs for taxation;
•Set a time for the payment of the costs concerned.
In addition, pursuant to rule 22.09, unless the Court orders otherwise, a party is entitled to costs and properly incurred disbursements, as calculated by schedule 2 to the Rules. This is the method by which the Child Support Registrar has calculated the costs sought by it.
The general rule in civil proceedings is that costs follow the event. This is not to penalise an unsuccessful litigant, rather it is to compensate a successful litigant for expenses which might otherwise have been avoided given the outcome of the substantive issue before the Court.[68] McHugh J expressed the principle in the following terms in Latoudis v Casey:[69]
An order for costs indemnifies the successful party in litigious proceedings in respect of liability for professional fees and out-of-pocket expenses reasonably incurred in connection with the litigation. The rationale of the order is that it is just and reasonable that the party who has caused the other party to incur the costs of litigation should reimburse that party for the liability incurred. The order is not made to punish the unsuccessful party. Its function is compensatory. Thus, in civil proceedings an order may, and usually will, be made even though the unsuccessful party has nearly succeeded or has acted reasonably in commencing the proceedings. It may, and usually will, be made even though the action has failed through no fault of the unsuccessful party.
[68] See Miller v Ng & Anor (No 2) [2018] FCCA 26 at [17] (Terry J), quoting Kazar (liquidator) v Kargarian; In the matter of Frontier Architects Pty Ltd (in Liquidation) (2011) 197 FCR 113, 116 [9] (Greenwood and Rares JJ).
[69] Latoudis v Casey (1990) 170 CLR 534, 566-7 (McHugh J).
In Miller v Ng & Anor, Judge Terry awarded costs in favour of the Child Support Registrar following an unsuccessful AAT appeal. In so doing, she referenced an early decision of Judge Harland in BKK16 & BKN16 & Anor, who also decided to award costs, in favour of the Registrar, on the basis that costs ordinarily follow the event, including in an AAT Child Support Appeal.[70]
[70] See BKK16 & BKN16 & Anor [2017] FCCA 938.
Like all discretions conferred on the Court, the discretion to award costs is one which must be exercised judicially. Matters which have been deemed relevant to a decision not to award costs include the following:
·The conduct of a party is such that it would not be appropriate to award costs;
·The proceedings in question related to a matter of public interest; and
·An offer to settle proceedings has been made.
None of these considerations apply to the present matter. Although the Registrar is a publicly funded office with the resources of the Commonwealth behind it, it was still put to significant expense and is entitled to some recompense in these circumstances.
The father and mother have each been self-represented in the matter. The mother’s position has been wholly vindicated but she has not made any personal application for costs and given she has not been represented in the proceedings, I do not consider she is entitled to an award of costs.
The father has been entirely unsuccessful in the proceedings. In these circumstances, I propose to make an award of costs in the Registrar’s favour in an amount of $5,000.00.
For all these reasons, the orders of the Court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding one hundred and sixty-seven (167) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Brown. Associate:
Dated: 20 October 2021
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