Cliburn and Child Support Registrar (Child support)

[2021] AATA 5187

Cliburn and Child Support Registrar (Child support) [2021] AATA 5187 (10 November 2021)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2021/PC022324

APPLICANT:  Mr Cliburn

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member M Martellotta

DECISION DATE:  10 November 2021

DECISION:

The decision under review is set aside and the matter is remitted back to the Child Support Registrar for consideration in accordance with the direction that the Registrar determine the objection, as it was lodged within time and no extension of time is required.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object - reasonable explanation for the delay in lodging the objection late – some prospects of objection succeeding and therefore there is arguable merit – no prejudice to the other parent – no extension of time required - decision under review set aside and sent back with directions

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

REASONS FOR DECISION

BACKGROUND

1. This review concerns the question of whether Mr Cliburn should be granted an extension of time within which to lodge his objection to a decision made by Services Australia – Child Support (the Agency).

2. On 8 June 2021 the Agency decided to accept a binding financial agreement for the collection of spousal maintenance. The Agency says that Mr Cliburn lodged an objection to that decision on 26 July 2021 which was more than 28 days after they had notified him of the decision in writing.[1]

   [1] Page 13 of the Agency documents

3. Mr Cliburn made application to the Agency for an extension of time to be granted. On 4 September 2021 the Agency refused the application. Mr Cliburn now comes to the tribunal seeking review of the Agency decision.[2]

   [2] Application for review lodged on 15 September 2021

4. The tribunal held a hearing on 10 November 2021. Mr Cliburn was legally represented at the hearing by [Mr A] SC. Mr Cliburn and [Mr A] SC attended by conference telephone. Mr Cliburn provided evidence on affirmation. The Agency provided documents relevant to their decision (154 pages).

ISSUES

1. The statutory provisions relevant to this review are contained in Part VII of the Child Support (Registration and Collection) Act1988 (the Act); the Child Support (Registration and Collection) Regulations 2018 (the Regulations) and the Evidence Act 1995 (the Evidence Act).

2. Child support legislation is interpreted by the Agency with the aid of the Child Support Guide (the Guide). The tribunal is not bound by law to apply the policy as set out in the Guide but provided the policy is consistent with the legislation, it is required to have regard to it and in the ordinary course follow it.[3]

   [3] See Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634.

3. The issues which arise in this matter are as follows:

   i.Did Mr Cliburn lodge an objection to the Agency decision within the prescribed period? If not,

   ii.Is Mr Cliburn to be granted an extension of time within which to lodge his objection to the Agency decision?

CONSIDERATION

Issue one – Was the objection lodged within the prescribed period?

1. Subsection 80(1) of the Act provides that a person may lodge an objection in writing to the Agency in relation to specified decisions made by the Agency. This includes decisions to register a registerable maintenance liability.[4] Subsection 81(2) of the Act provides that a person must lodge an objection to such a decision within 28 days after a notice of the decision is served on them.

   [4] Section 18 of the Act

2. Mr Cliburn provided the following evidence:

   a)He did not receive the notice of decision from the Agency until the end of June 2021 some 22 days after the date of the notice. He thinks that this was about 30 June 2021.

   b)Correspondence from the Agency is sent to his consulting rooms and the usual administrative practice at his office is that he would review any correspondence within three days of receipt.

   c)He would not have overlooked the correspondence if it had arrived any earlier.

   d)After he received the notice of decision, he contacted the Agency to advise that he did not agree with their decision. This contact was made on 13 July 2021. Prior to that date he attempted to make contact by telephone but due to the hold time he was unable to get through and speak to anyone.

   e)He sought legal advice about the decision. His lawyers wrote the Agency setting out his objection to the decision.

3. [Mr A] SC submitted that the tribunal should accept his client’s evidence regarding the date that the notice of decision was received by him. He also noted that there were postal delays due to the impact of COVID-19.

4. The tribunal notes the following from the Agency documents and finds that:

   a)The notice of decision is dated 8 June 2021 and is addressed to Mr Cliburn at [Address 1]. The notice amongst other things states that he can seek review within 28 days from the date he receives the letter.[5]

   b)Mr Cliburn contacted the Agency by phone on 13 July 2021 in which he advised that on the legal advice he has received the decision to register the spousal maintenance agreement was legally incorrect due to his bankruptcy. He stated that he would send in details of the binding financial agreement so that the Agency could ‘fix this’. There was discussion of the best time for the Agency to call him back.

   c)On 19 July 2021 the Agency contacted Mr Cliburn to advise that his bankruptcy did not prevent collection by the Agency unless he obtains a stay order. Mr Cliburn advised that he will send in a copy of  his legal advice to demonstrate why the Agency is in error.

   d)On the same date (19 July 2021) the Agency received correspondence from Mr Cliburn’s solicitors, [Law Firm 1].[6] That letter advises that they are acting for Mr Cliburn and sets out the reasons why they dispute the legality of the Agency decision to register the spousal maintenance agreement. The letter seeks written confirmation that the Agency will not take steps to enforce the spousal maintenance liability.

   e)On 26 July 2021 the Agency contacted Mr Cliburn and advised that if he disagreed with the Agency decision, he needs to lodge an objection. On the same date Mr Cliburn sent an email confirming that he is objecting to the decision.

   f)According to Agency records, the relevant objection due date was 22 July 2021. It notes that Mr Cliburn was four days outside the period and is required to lodge an extension of time application.

   [5] Page 98 of the Agency documents

   [6] Page 107 of the Agency documents

5. The prescribed 28-day period is calculated as commencing from the date the notice of decision is served.[7] Subsection 31(2) of the Regulations provides that service of a notice is effected by (amongst other things) sending it by prepaid post to the person’s address for service and that:

   If service has been attempted by use of prepaid post, then, unless the contrary is proved, service will be taken to have been effected at the time when the notice or other communication would, in the ordinary course of the post, have arrived at the place to which it was addressed.

   [7] Section 81 of the Act

6. Section 163 of the Evidence Act provides that a letter from a Commonwealth agency is presumed to have been sent by pre-paid post to that address on the fifth business day after any date that purports to be the date the letter was prepared (in this case the relevant date being 8 June 2021). Section 160 of the Evidence Act presumes that a postal article sent by prepaid post is received at that address on the seventh working day after being posted. Utilising these presumptions would mean and the tribunal finds that Mr Cliburn is presumed to have received notice of the decision on 24 June 2021 and that the 28-day objection period concludes on 22 July 2021.

7. The tribunal notes that this is consistent with the Agency’s calculations and also with Mr Cliburn’s evidence that he saw the correspondence around 30 June 2021 on the basis he would usually review correspondence received at his office within three days of receipt, 24 June 2021 being a Thursday, and three days within that being 29 June 2021.

8. Mr Cliburn made contact with the Agency on 13 July 2021 and on 19 July 2021 the Agency received a letter from his lawyers stating the reasons why their client disagreed with the Agency decision and seeking certain assurances. The question that arises is whether either of these contacts which come within the 28-day prescribed period can be viewed as an objection to the decision?

9. As noted, subsection 80(1) of the Act provides that an objection must be in writing from the person who may object to the decision. According to the Guide[8] the person does not have to use the word ‘objection’ but is required to ask for reconsideration of the original decision. The Guide goes on to note that:

   CSRC Act section 80(1) specifies who may object… A person who may object must lodge their own objection unless it is made on their behalf by someone with power of attorney or with statutory rights to deal with the parent's finances (such as a State Trustee). Another person who is otherwise authorised to act as the representative of a person who may object (including a solicitor) may not write an objection on behalf of the person who may object unless the person who may object signs the objection.[9]

   [8] 4.1.4

   [9] ibid

10. The Guide refers the reader to another policy section for more information on the above aspect.[10] That section deals with authorised representatives:

    Services Australia is not obliged to recognise the authority of a nominated representative, but will usually do so… Services Australia can communicate with 2 types of authorised representatives:

    ·authorised agents with power of attorney, or other legal authority to act on a person's behalf, and

    ·representatives with ordinary authority, including solicitors.

    …Representatives with ordinary authority have been authorised by a person to act on their behalf. They could be the solicitor of the child support parent… A representative with ordinary authority can lodge forms signed by the person whom they represent, including for:

    ·     objections

    [10] 6.6.3

11. The provisions of the Act are silent regarding the form of the objection where a person is legally represented. It provides (subsection 80(1) of the Act) who can object to a decision to register a registrable maintenance liability (the payer or payee). Section 84 provides that the objection must state or give fully and in detail the grounds relied on.

12. In this particular matter the verbal contact made by Mr Cliburn on 13 July 2021 does not meet the legislative requirements for a valid objection.

13. In in his subsequent discussion on 19 July 2021 Mr Cliburn advised the Agency that he had sought legal advice regarding the legality of the decision made by the Agency. On the same day (19 July 2021) his lawyers wrote to the Agency on Mr Cliburn’s behalf setting out the legal reasons and details why they say the decision to register the spousal maintenance agreement is wrong. That letter is not signed by Mr Cliburn but is signed by his legal representative and Mr Cliburn is noted as having been provided a copy.

14. In the tribunal’s view Mr Cliburn’s solicitors were clearly acting on his instructions consistent with the Legal Profession Conduct Rules applicable to Western Australian legal practitioners.[11] The requirement that Mr Cliburn’s signature appear on the ‘objection form’ appears to be a requirement specified only in Agency policy, as such this policy requirement appears as something that is in addition to the legislative provisions which simply requires the objection to be made by the payer or payee;  is in writing and provide sufficient detail.[12]

    [11] Part 3 of the Legal Profession Conduct Rules 2010 (Western Australia)

    [12] Section 16 of the Act provides that the Registrar may stipulate the manner of an application, notice or election, but has not provided regulations in this regard outside of the policy reference.

15. As noted, the tribunal is not bound by Agency policy. In this matter the tribunal is satisfied that the letter sent to the Agency by Mr Cliburn’s solicitors on 19 July 2021 (and noted as being received by the Agency on that same date) meets the requirements of section 84 of the Act and for this reason meets the legislative requirements of an ‘objection’. The tribunal has also found that the relevant objection due date in this matter was 22 July 2021.

16. On this analysis the tribunal arrives at the conclusion that Mr Cliburn’s objection was not outside the prescribed 28-day period and as such there is no requirement that an application for an extension of time be considered. It is therefore appropriate for the matter to be remitted to the Registrar with the direction to consider Mr Cliburn’s objection as it was lodged within time.

Issue two – Should an extension of time be granted?

1. In view of this conclusion the tribunal is not required to consider issue two, however for the sake of completeness the tribunal notes that even if Mr Cliburn did not object within time the tribunal would in any event be satisfied that this is a case in which an extension of time ought to be granted, for the following reasons.

2. In cases where the lodgement period has passed, a person may send an objection along with an extension of time application requesting the Agency to treat the objection as having been duly lodged (section 82 of the Act). The application must state fully and in detail the grounds for the application, including the circumstances concerning, and the reasons for, the failure by the person to lodge the objection in time. The Agency must consider and either grant or refuse the application for an extension of time. If the application is granted, then the person is taken to have lodged the objection (section 83 of the Act). If the application is not granted, a person may apply to this tribunal for review of a decision on an application for an extension of time (section 89 of the Act).

3. The exercise of the discretion as to whether or not to grant an extension of time is on the basis of whether it is reasonable or proper to grant the application. A number of decisions provide guidance to the tribunal in determining this issue. It is clear from those decisions that the statutory time limit of 28 days is to be enforced unless there are acceptable reasons for departing from this prescribed timeframe.

4. In Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, the High Court noted that while an extension of time is the exception to the general rule, there are legislative provisions which in the circumstances of the facts of an individual case, may indicate that justice is served by the general rule being overruled.

5. The Federal Court in Hunter Valley Developments v Cohen (1984) 3 FCR 344 (Hunter Valley Developments) noted that in general, applications or proceedings commenced outside of a prescribed time limit will not be considered. The court also said that there must be an acceptable explanation for the delay and that it must be fair and equitable in the circumstances to extend time. The Federal Court identified six factors to take into account when deciding whether to grant an extension of time:

   ·     The reasons for the delay and whether the applicant rested on their rights or took action to make the decision-maker aware that the decision was being contested;

   ·     Any prejudice to the other party including any difficulties that they will experience in providing evidence as a result of the delay;

   ·     Any wider prejudice to the general public;

   ·     Fairness in granting an extension of time as between the applicant and other persons in a similar position;

   ·     The merits of the substantive application;

   ·     Whether it is proper to grant the extension of time.

6. In Brown v Commissioner of Taxation [1999] FCA 563, Hill J reviewed the principles set out in Hunter Valley Developments and noted that those factors serve as a guide and were not exhaustive. In light of the approach by the tribunal in more recent times in cases such as Vickers and Child Support Agency [2006] AATA 112 and McConnell and Child Support Registrar [2005] AATA 342, and mindful that the Hunter Valley Developments factors are only a ‘guide’, the tribunal has taken these factors into account in determining whether the extension of time should be granted in this case.

Did Mr Cliburn rest on his rights?

1. The tribunal is satisfied that Mr Cliburn did not rest on his rights. Whilst his first contact after receiving the notice of decision was on 13 July 2021 the tribunal accepts his evidence that he was seeking legal advice to clarify his position with respect to the decision. Mr Cliburn upon receiving that advice contacted the Agency and also instructed his lawyers to write to the Agency on his behalf setting out the legal reasons as to why he disagreed with their decision.

2. Ultimately if it was the case that a valid objection was not lodged until 26 July 2021 when the Agency received his email the tribunal is satisfied that in this matter there was an acceptable explanation for the delay and that Mr Cliburn did not rest on his rights. There is clear evidence of him taking action in this matter; as noted in the Hunter Valley Developments decision the Court made a distinction between a person ‘who has continued to make the decision maker aware that he contests the finality of the decision’[13] and one who has allowed the decision maker to believe that the matter was finally concluded.

Does the substantive application have merit?

[13] At [19]

1. In DHLD and Executive Director, Social Security Appeals Tribunal [2010] AATA 377 the tribunal stated that when considering the question of merits in the context of an application seeking an extension of time:

   it is not the occasion on which to embark upon a detailed consideration of the evidence and the merits. The question that must be asked is whether the applicant on the extension application has an arguable case. If, at a substantive hearing, that applicant were able to produce evidence to establish the facts he or she put forward on the extension application, would he or she have an arguable case having regard to the facts put forward and the law against which those facts must be considered?[14]

   [14] At [53]

2. In the matter of Brown v Commissioner of Taxation[15] the Court stated that:

   …an applicant should show that he or she has an arguable case. No doubt if the objection on the face of it is one which is frivolous or bound to fail as a matter of law it would be a futility to permit an extension of time to enable it to be considered. But this points to quite a low threshold. What is involved is whether the objection on its face discloses a case which is arguable, not whether having regard to other matters, including evidence which may not even be known to the taxpayer at the time of making the application, the case is one that the taxpayer will or will probably lose.[16]

   [15] [1999] FCA 563

   [16] At [56]

3. In this matter the tribunal was satisfied after considering the submissions made by [Mr A] SC that there is an arguable case. In effect the submissions made on Mr Cliburn’s behalf are as follows:

   a)Mr Cliburn entered into a financial agreement made pursuant to section 90D of the Family Law Act 1975 in which he agreed to pay specified spousal maintenance.

   b)Mr Cliburn became bankrupt on 10 March 2021.

   c)Section 58 of the Bankruptcy Act 1966 provides that spousal maintenance debts arising from financial agreements (emphasis added) are cancelled by bankruptcy.

   d)Subsection 58(5A) of the Bankruptcy Act1966 provides an exemption that it does not prevent enforcing a liability under a maintenance agreement.

   e)The definition of a maintenance agreement in section 5 of the Bankruptcy Act 1966 however excludes financial agreements within the meaning of the Family Law Act 1975.

   f)The Agency have incorrectly concluded that the spousal maintenance arises under a Court Order dated 8 November 2017. This order however does not create the obligation to pay spousal maintenance – the obligation arises solely under a financial agreement which is exempt.

   g)The Agency’s specific reference to paragraph 153(2)(c) of the Bankruptcy Act 1966 is also misdirected as it refers to the event of a person’s release from bankruptcy.

1. The Agency has noted relevant provisions set out in the Guide[17] which identify that debts arising from a child support assessment or spousal maintenance are not automatically released from debts at the time of discharge which means that all registrable maintenance liabilities will survive the bankruptcy. In this matter the tribunal notes that the Agency is concerned with the collection of spousal maintenance and the provisions referenced in relation to the bankruptcy reference the recovery of debts.

   [17] 5.4.5

2. On balance, taking into account the submissions put forward on Mr Cliburn’s behalf and relevant authorities the tribunal concludes there is an arguable case.

Prejudice to the other party and to the general public?

1. The tribunal concluded that whilst the other parent, in the absence of any objection, is entitled to rely upon the decision of the Department as made, the tribunal is satisfied that the other parent would be afforded the opportunity to participate in any objection process that may arise. The tribunal is also satisfied that given the original decision was only made in June 2021 this is not such a lapse of time that would make it difficult for the other parent to provide or respond to relevant evidence.

2. [Mr A] SC submitted that the prejudice to the general public rests in the public interest to ensure that the Agency acquits its function in accordance with the law and on his submission based upon the underlying merits of his client’s case has not occurred.

3. The tribunal is cognisant of the general public’s expectation that government departments and statutory bodies perform their functions quickly and fairly to promote reliable outcomes in the most cost-effective manner. However as noted in this matter, the delay is not significant and the tribunal is satisfied that there are circumstances in this case which distinguish Mr Cliburn’s matter from that of other individuals in a similar situation.

4. In the circumstances of this case and taking into account [Mr A] SC’s submissions the tribunal was not satisfied that allowing an extension of time would disrupt the established and reasonable practice of lodging objections in a timely manner and, on balance, the tribunal concluded that there would not be prejudice to the general public in granting the extension of time.

Conclusion

1. In this matter the tribunal has concluded that Mr Cliburn has lodged his application within the prescribed period of 28 days on 19 July 2021. However even if Mr Cliburn had lodged out of time the tribunal is in any event satisfied that it would have been proper, fair and equitable to grant the extension of time requested.

DECISION

The decision under review is set aside and the matter is remitted back to the Child Support Registrar for consideration in accordance with the direction that the Registrar determine the objection, as it was lodged within time and no extension of time is required.