Child Support Registrar and Dunstan and Anor
[2011] FMCAfam 762
•2 August 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CHILD SUPPORT REGISTRAR & DUNSTAN and ANOR | [2011] FMCAfam 762 |
| CHILD SUPPORT – Enforcement – Child Support debt – penalties – review of decision by Child Support Agency – time limit for objection to decision – application for review of decision of Registrar to extend time – where Social Security Appeals Tribunal affirmed the decision not to grant an extension of time – where no appeal against the decision of the Social Security Appeals Tribunal. |
| Child Support (Assessment) Act 1989 (Cth), ss.98S, 111, 112, 117, 118 Child Support (Registration and Collection) Act 1988 (Cth), ss.30, 67, 81, 89, 103X, 110B, 113, 116 Federal Magistrates Court Rules 2001, R.25A.06 |
| Bagala & Bagala [2009] FMCAfam 953 |
| Applicant: | CHILD SUPPORT REGISTRAR |
| First Respondent: | MR DUNSTAN |
| Second Respondent: | MS LYNCH |
| File Number: | SYC 1043 of 2011 |
| Judgment of: | Scarlett FM |
| Hearing date: | 5 July 2011 |
| Date of Last Submission: | 5 July 2011 |
| Delivered at: | Sydney |
| Delivered on: | 2 August 2011 |
REPRESENTATION
| Solicitors for the Applicant: | Mr Gouliaditis, Australian Government Solicitor |
| Solicitors for the Respondents: | Mr Fernie (as agent), Graeme J. Peters Solicitors |
ORDERS
The Court declares that as at 1 July 2011 the Respondent owes the Applicant the sum of $30,453.97 consisting of $27,189.87 in arrears of child support and $3,264.10 in late payment penalties.
The Respondent is to pay to the Applicant the sum of $30,453.97 within sixty (60) days.
IT IS NOTED that publication of this judgment under the pseudonym Child Support Registrar & Dunstan and Anor is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYC 1043 of 2011
| CHILD SUPPORT REGISTRAR |
Applicant
And
| MR DUNSTAN |
First Respondent
| MS LYNCH |
Second Respondent
REASONS FOR JUDGMENT
Application
The Applicant Child Support Registrar has issued an enforcement summons under the provisions of s. 113 of the Child Support (Registration and Collection) Act 1988, seeking to recover an unpaid child support debt now amounting to $27,189.87 and penalties amounting to $3,264.10.
The First Respondent (hereafter referred to as “The Respondent”) filed a Response on 3rd May 2011, seeking orders:
1. That leave be granted pursuant to s. 112 of the Child Support (Assessment ) Act 1989 for:
(a) Either the Registrar of the Child Support Agency to make a new determination under s. 98S of the Child Support (Assessment) Act 1989 for the period 11 June 2009 to 31 December 2011; or
(b) This Honourable Court make an appropriate Order under s. 118 of such Act.
2. That the enforcement proceedings commenced by the Applicant be stayed until a determination is made under paragraph 1 hereof.
In his supporting affidavit, the Respondent claims that his taxable income is substantially less than as determined by the Child Support Agency.
On 6th June 2011 the Respondent filed an Application in a Case, seeking the same orders as he sought in his Response along with the dismissal of the summons with no order as to costs. He relied on the same evidence as in his supporting affidavit filed previously. He joined the children’s mother as Second Respondent to his Application in a Case, but she has not played any active part in the proceedings, nor has she been required to.
Evidence
The Applicant relied on an affidavit by Mr B affirmed on 22nd February 2011, setting out that the Respondent had a registered liability arising from a Stage 2 assessment of child support in respect of his two children, who were both born in 2003. The liability was collected privately until 14th February 2006 and was then, again, registered for collection with the Child Support Agency. The Respondent’s current monthly liability was $997.83.
The Applicant tendered a certificate under sub-section 116(2) of the Child Support (Registration and Collection) Act, showing that as at 4th July 2011, the day before the hearing, an amount totalling $30,453.97 was due and payable by the Respondent , made up as follows:
a)Child support debt $27,189.87;
b)Penalties of $3,264.10.
The Respondent deposed in his affidavit sworn or affirmed[1] on 3rd May 2011 that on 31st July 2009 a Senior Case Officer of the Child Support Agency made a determination under Part 6A of the Child Support (Assessment) Act 1989 adjusting his taxable income to $116,000.00 per annum for the purposes of his child support liability. This assessment was to apply from 11 June 2009 to 31 December 2011.[2]
[1] It does not say which
[2] Affidavit of Mr Dunstan 3.5.2011 at paragraph [2]
His previous child support assessment was based on his 2007/2008 taxable income of $18,404.00.
The Respondent deposed that on 9th August 2010 the Social Security Appeals Tribunal determined that he was “not able to appeal the decision made by the Child Support Agency of 31 July 2009”.[3]
[3] Affidavit of Mr Dunstan 3.5.2011 at [4]
The Respondent also deposed that he believed the Child Support Agency had failed to take into account his submissions as to his true financial position. His taxable income for the financial years ending 30 June 2009 and 30 June 2010 was nil.
Submissions
In answer to the submission that it was “far too late in the day” for the Respondent to apply for a change in the child support assessment, especially as the Respondent had failed to object, or to participate in the proceedings before the Social Security Appeals Tribunal, the solicitor for the Respondent, Mr Fernie, told the Court that the Respondent’s delay in bringing proceedings earlier was due to the fact that he was not legally represented at the time and did not understand the need to act with any great alacrity. That situation had changed, because the Respondent had sought the advice of Mr Fernie’s principal, Mr Peters.
Mr Fernie conceded that the Respondent was not without means and, indeed, had substantial assets. However, he was assessed with an annual income of $116,000.00, which was a forward assessment made in 2009. The Respondent has no income at present. Whilst it is a fact that he had property, he has no capacity to borrow any more money.
Mr Fernie also submitted that, as a matter of public policy, parties should be given the opportunity to have a fair hearing.
It was submitted on behalf of the Child Support Registrar that the Respondent is applying under s. 111(1) of the Child Support (Assessment) Act 1989 for either the Registrar to make a determination under s. 98S of for the Court to make an order under s. 118. Under s 112 of the Act, the Court may grant leave for the Registrar to make a determination under s. 98S or the Court to make an order under s. 118.
The Child Support Registrar submits that the Respondent is seeking the Court’s leave for either the Registrar or the Court to make a further departure determination or order with respect to the child support period that was the subject of a departure determination made by the Registrar on 31st July 2009. The Registrar further submits that the Court should refuse leave, for the following reasons:
a)The Respondent has not addressed any of the matters in relation to which the Court must be satisfied and which are relevant to the exercise of its discretion under s. 112(4) (any responsibility or reason for the delay in making an application or a determination, any hardship to a party if leave is granted or not granted);
b)No draft application has been provided to the Court, nor has the Respondent provided copies of the relevant decisions;
c)The Respondent’s assertion in his affidavit of 3rd May 2011 that his taxable income was ‘nil’ and the Child Support Agency failed to take into account any material and oral submissions he had made as to his true financial position is an insufficient basis upon which to grant leave, particularly where the Respondent did not participate in either the review or the conference before the Child Support Registrar and failed to provide any current detailed statements;
d)The Respondent has failed to refer to any of the requirements in subsection 117(2) in establishing the special circumstances which exist and to which the Court should have regard when considering whether a departure order should be made.
It was also submitted that the application for leave should be refused on discretionary grounds, because the Respondent had failed to act promptly in response to the decision made by the Registrar on 31st July 2009. In particular, the Respondent:
a)waited for approximately 10 months before applying for an extension of time to lodge an objection;
b)did not participate in either the review or the conference before the delegate;
c)did not attend a conference before the Social Security Appeals Tribunal; and
d)did not take any action in response to the SSAT decision, such as an appeal under s. 110B of the Child Support (Assessment) Act 1989 until prompted by the commencement of these proceedings.
The Child Support Registrar also relies on the decision of Riethmuller FM in Bagala & Bagala[4] at [20]-[22], and particularly at [23], where his Honour said:
By waiting until the Child Support Agency issued proceedings for enforcement before seeking a departure decision, the applicant is also circumventing the substance of the legislation scheme which provides for all departure decisions to be administrative, and only to be heard in court on appeal from the SSAT or if other proceedings are pending. The legislature would not have expected the payee to be drawn into expensive litigation at this stage.
[4] [2009] FMCAfam 953
The Child Support Registrar submits that the Court should not exercise its discretion in favour of the Respondent and should refuse the leave sought.
Conclusions
The Respondent’s case arises out of a decision made by a delegate of the Child Support Registrar on 31st July 2009. The decision was made under the provisions of Part 6A of the Child Support (Assessment) Act. A copy of the Notice of Decision is attached to the Child Support Registrar’s written submission.
The delegate’s decision was:
1. To change the administrative assessment of child support.
2. For the period 11 June 2009 to 31 December 2011, I determine Mr Dunstan’s adjusted taxable income be set at $116,000.
3. For the period 11 June 2009 to 31 December 2011, I determine Ms Lynch’s adjusted taxable income be set at $66,000.
The delegate noted that Ms Lynch participated in a conference before the delegate. However, the Respondent did not participate:
As Mr Dunstan did not participate in either the review or conference I will in the absence of any current detailed financial statements, such as current taxation returns or Profit and Loss statements my decision has been based on information contained in financial institution statements.[5]
[5] Notice of Decision 31st July 2009 page 3
Again, the delegate noted:
Unfortunately, Mr Dunstan was not available at the time of his conference and I was unable to discuss this matter with him. I have therefore based my decision solely on the information provided by the Financial Investigator. If Mr Dunstan believes that my decision is unfair, he could lodge his own change of assessment application, or an objection, but the application or objection should be accompanied by comprehensive details of his financial circumstances. An objection must be lodged within 28 days of the receipt of this notice of determination.[6]
[6] Ibid at page 5
The Respondent did not lodge an objection within 28 days, which is the time limit prescribed by s. 81 of the Child Support (Registration and Collection) Act. He sought to do so considerably later, 8th July 2010. On 2nd August 2010, a delegate of the Registrar refused to extend the time to lodge an objection to the decision.
On 9th August 2010 the Respondent applied to the Social Security Appeals Tribunal for review of the decision not to extend the time to lodge an objection, as is provided by s. 89 of the Act. The hearing took place on 23rd September 2010. The Respondent attended by telephone.
The Social Security Appeals Tribunal made a decision on 23rd September 2010, affirming the decision under review. A copy of the decision of the Social Security Appeals Tribunal is attached to the Child Support Registrar’s written submissions and a further copy was handed up in Court.
The Tribunal found that:
a)The Respondent did not lodge his objection until approximately ten months the statutory time frame had expired, which it characterised as “a lengthy delay”[7];
b)The Respondent’s claim that he did not lodge his objection in time because he was unaware of his objection rights was not a reasonable excuse for the delay;
c)The Tribunal inferred that Ms Lynch may suffer some prejudice if the Respondent’s application were granted;
d)Granting an extension of time to lodge an objection approximately ten months out of time raised a question of fairness between him and other persons in similar positions;
e)Whilst the Tribunal was satisfied that the Respondent’s objection may have some merit, it was not possible to say on the evidence available whether a decision to change the assessment may be favourable or unfavourable;
f)The legislative time limit to lodge objections is in place for good reason. As the Respondent had an alternative remedy, by lodging a change of assessment application, the relevant public policy considerations did not weigh in favour of granting the extension application; and
g)Having regard to all the circumstances, it was not proper to grant the extension application.
[7] Tribunal Decision page 9 at paragraph [39]
The Child Support (Registration and Collection) Act 1988 provides at section 110B a right to appeal from a decision of the Social Security Appeals Tribunal on a question of law. The appeal must be filed within 28 days of receiving a written statement of reasons for the decision under subsection 103X(3) or (5) of the Act (see Federal Magistrates Court Rules 2001, Rule 25A.06).
The Respondent did not appeal against the decision of the Social Security Appeals Tribunal.
The Respondent could also have exercised the remedy referred to by the Social Security Appeals Tribunal, by lodging a change of assessment application “on the basis that the current assessment is not fair because of his changed income and financial resources.”[8] He has not done so.
[8] Tribunal Decision page 11 at [50]
It has only been since the Applicant Child Support Registrar has commenced proceedings against the Respondent that he has taken any steps to change the assessment which he wishes to challenge. It seems to me that this Court should following the reasoning of Riethmuller FM in Bagala & Bagala[9], where his Honour said at [23]:
By waiting until the Child Support Agency issued proceedings for enforcement before seeking a departure decision, the applicant is also circumventing the substance of the legislation scheme which provides for all departure decisions to be administrative, and only to be heard in court on appeal from the SSAT or if other proceedings are pending.
[9] supra
The application for leave under s. 112 of the Child Support (Assessment) Act 1989 is refused. I am satisfied that as at 1 July 2011 the Respondent owes the sum of $30,453.97, consisting of $27,189.87 in arrears of child support and $3,264.10 in late payment penalties.
The Court finds in favour of the Applicant Child Support Registrar.
I propose to order that the Respondent pay to the Applicant the child support debt of $30,453.97 as set out in the certificate under sub-section 116(2) of the Child Support (Registration and Collection) Act 1988 filed in Court on 5th July 2011.
I note that the Applicant seeks costs in the sum of $3,221.40. The Respondent seeks that the Court make no order as to costs. I will hear submissions on costs.
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of Scarlett FM
Date: 2 August 2011
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