Clinton and Child Support Registrar (Child support)

[2019] AATA 4884

Clinton and Child Support Registrar (Child support) [2019] AATA 4884 (17 September 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBERS:  2019/SC016915 and 2019/SC016895

APPLICANT:  Mr Clinton

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member Y Webb

DECISIONS DATE:  17 September 2019

DECISIONS:

The decisions under review are affirmed.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object – no satisfactory explanation for the delay – arguable merit – weighing all factors the extension of time was correctly refused – decision under review affirmed

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 DECISIONS

BACKGROUND

1. This review is about whether Mr Clinton should be granted an extension of time to object to:

   ·a decision made by the Department of Human Services (Child Support Agency) on 11 October 2016 to reflect an income provided by Mr Clinton of $55,000 for the 2015/2016 year; and

   ·a decision made by the Child Support Agency on 27 September 2017 to reconcile Mr Clinton’s 2016/2017 estimate of income resulting in arrears of $2,050.87.

2. Mr Clinton and Ms Clinton are the parents of two children now aged 15 and 11 years old (the children).  The case was registered for collection by the Child Support Agency from 16 September 2016.

Decision of 11 October 2016

1. The background to this review is that on 11 October 2016 Mr Clinton supplied an income figure of $55,000 for the 2015/2016 year which was accepted by the Child Support Agency and notified to him by a letter of the same date.  On 27 September 2017 the Australian Taxation Office calculated that Mr Clinton’s 2015/2016 taxable income  was $110,257.  Significant arrears were payable due to the disparity of the income of $55,000 that had been used in the assessment.

2. On 7 June 2019 Mr Clinton lodged an objection to that decision together with an application for an extension of time.

3. On 20 June 2019 a delegate of the Registrar refused Mr Clinton an extension of time.

Decision of 27 September 2017

1. The background to this review is that on 15 February 2017 Mr Clinton lodged an estimate of nil income for the 2016/2017 year which was accepted by the Child Support Agency and notified to him by a letter of the same date.  On 27 September 2017 the Child Support Agency calculated that Mr Clinton’s actual income for the 2016/2017 year was $20,470.  This resulted in arrears of child support of $2,050.87.

2. On 9 May 2019 Mr Clinton lodged an objection to that decision together with an application for an extension of time.

3. On 20 June 2019 a delegate of the Registrar refused Mr Clinton an extension of time.

Applications to the Administrative Appeals Tribunal

1. On 11 July 2019 Mr Clinton requested a review by the Administrative Appeals Tribunal (the Tribunal) of the decisions of 11 October 2016 and 27 September 2017 to refuse extensions of time.

2. Mr Clinton attended the hearing on 17 September 2019 by way of a telephone conference and gave sworn evidence.

3. The Child Support Agency provided a bundle of documents relevant to this matter and this was marked Exhibit C1.

ISSUES

1. The issues which arise in this case are whether Mr Clinton’s objections were lodged outside of the statutory timeframe; and if so whether he should be granted extensions of time to object to the decisions made on 11 October 2016 and 27 September 2017.

CONSIDERATION

1. The legislation relevant to this review is the Child Support (Registration and Collection) Act 1988 (the Act).

2. The relevant sections in relation to the Act are section 81 (Time limits on lodging objections), section 82 (Applications for extensions of time) and section 83 (Consideration of applications for extensions of time for lodging objections). 

3. Section 81 requires that a person must lodge an objection to a decision within 28 days of notice of the decision.  Section 82 of the Act provides that a person may request an extension of time to lodge an objection if the statutory timeframe has ended.  The application must state fully and in detail the grounds of the application, including the circumstances and the reasons for the failure of the person to lodge as required by section 81 (that is, within 28 days).

4. The Registrar must consider an application for an extension of time and either grant or refuse that application.  In circumstances where a person’s application is refused, the person may apply to the Tribunal for a review of that decision (section 89 of the Act).

5. In this case, the Child Support Agency refused the applications and provided reasons.  In brief summary, the reasons for refusing an extension of time to object to both decisions were that Mr Clinton may have rested on his rights; had not provided a valid reason for his delay in objecting; there would be some prejudice to Ms Clinton and the general community if the extensions were granted; and the objections did not have merit.

Should Mr Clinton be granted an extension of time to object?

1. In considering whether Mr Clinton should be granted an extension of time, the Tribunal had regard to the principles detailed in the decision of Hunter Valley Developments Pty Ltd v Cohen[1] and subsequent cases.[2] 

   [1] [1984] FCA 176 (Hunter Valley)

   [2] Including Mulheron and Australian Telecommunications Corporation [1991] AATA 673

2. It is clear from Hunter Valley at [18] that the prescribed period of 28 days is “not to be ignored”[3] and that the prima facie rule is that in normal circumstances, proceedings commenced outside that period will not be entertained.[4]  In short, Wilcox J in Hunter Valley at [18] stated that it would not be appropriate to “grant the application unless positively satisfied that it is proper to do so”. The relevant case law establishes that the decision maker must consider and balance the following factors:

   ·       the explanation for the delay and whether the explanation is acceptable and whether it is fair and equitable in the circumstances to grant the extension;

   ·       action taken by the applicant to make the respondent aware of dissatisfaction with the decision;

   ·       any prejudice to other parties to the review arising out of the delay;

   ·       whether issues arise of public interest; and

   ·       the merits of the case.

   [3] Ralkon v Aboriginal Development Commission [1982] FCA 153

   [4] Lucic v Nolan (1982) 45 ALR 411

Was there an acceptable explanation for the delay?

1. In relation to the decision of 11 October 2016 a letter of the same date was sent to Mr Clinton advising him of the decision to accept an updated 2015/2016 income from him of $55,000. In addition, the Child Support Agency notes record that a child support officer telephoned Mr Clinton on 11 October 2016 and discussed the decision.[5]  The letter of 11 October 2016 also informed him of his objection rights. Mr Clinton agreed that he received the letter of 11 October 2016. 

   [5] C1: 27

2. In relation to the decision of 27 September 2017 the Child Support Agency records show that a letter was sent to Mr Clinton advising him of the decision to reconcile  his 2016/2017 estimate of income resulting in an additional $2,050.87 of child support being payable. Mr Clinton told the Tribunal that he could not recall receiving that letter which outlined his objection rights.  However, he confirmed that he had not changed his address and that he was receiving the child support assessment letters which would have included the child support assessment letter dated 27 September 2017 to which Mr Clinton did not object within 28 days of receipt of that letter.

3. In relation to both decisions, Mr Clinton stated that he did not object at that time because he was overwhelmed by the whole process.  He stated that he didn’t have any income at all because his business was in debt and the company was liquidated in December 2016. 

4. Mr Clinton stated that he was in the middle of Family Court proceedings at that time and that he was not familiar with the Child Support processes or the legal processes.  He thought he could tell the Child Support Agency about his dire financial situation and that they would take that into account in calculating how much child support he had to pay.  He stated that he felt completely overwhelmed by all that was happening in his life.

5. Mr Clinton lodged his objection to the decision of 11 October 2016 on 7 June 2019 and to the decision of 27 September 2017 on 9 May 2019 which was a delay of almost three years in relation to the 2016 decision and almost two years in relation to the 2017 decision outside of the required timeframe.

6. The Tribunal acknowledges that Mr Clinton found it difficult to cope with the court proceedings and his unfamiliarity with the child support processes.  He admitted to feeling overwhelmed and numb.  He stated that he had spent four weeks in early 2017 in a mental health unit.  The Tribunal acknowledges that Mr Clinton was struggling to cope with a multitude of issues both personal and financial at that time.  However, the delay in objecting was very lengthy and while the child support papers show that Mr Clinton obtained legal advice about the child support processes in 2019 it appears that he did not do so at an earlier time when he became aware of the decisions of 11 October 2016 and 27 September 2017. In relation to his feeling overwhelmed this circumstance is not markedly different from other parents in similar circumstances.

7. The Tribunal finds that, on balance, Mr Clinton did not have a compelling explanation for his delay in lodging his objections.

Action taken by the applicant to make the respondent aware of dissatisfaction with the decisions

1. The relevant decisions were made on 11 October 2016 and 27 September 2017.  The Child Support Agency papers show that an officer spoke with Mr Clinton on 13 October 2017 about both of the decisions under review.  The notes state that Mr Clinton terminated the call following a discussion about arrears owing due to the decisions of 11 October 2016 and 27 September 2017.  The Tribunal is satisfied that Mr Clinton expressed his views about his dissatisfaction with those decisions.  However, Mr Clinton did not indicate in that call that he was intending to object.

2. There is evidence of other contacts between Mr Clinton and the Child Support Agency but these relate to care of the children, Family Court proceedings and Mr Clinton’s change of assessment application.  Mr Clinton did contact the Child Support Agency on 30 April 2019[6] regarding the decision of 27 September 2017 to reconcile his estimate for the 2016/2017 year and subsequently lodged that objection on 9 May 2019.  There is no evidence of prior contacts regarding objecting to the decision of 11 October 2016 until an objection was lodged on Mr Clinton’s behalf by his lawyer on 7 June 2019.

   [6] C1:213

3. The Tribunal is satisfied that to some degree, in relation to both objections, Mr Clinton rested on his rights.

Prejudice to the other party to the review arising out of the delay

1. The other party to the review is Ms Clinton.  While it is not likely that the passage of time would hinder her ability to put forward her case should there be a review of the substantive decisions, the result of a successful objection may result in a retrospective change to the assessment.  The original decisions were made some years ago and a retrospective determination that the child support liability be decreased has the potential to impact on Ms Clinton’s capacity to financially support the children. In addition, a delay in lodging an objection has the potential to cause uncertainty to Ms Clinton and to that extent may cause some prejudice to her arising out of the delay.

2. On balance, the Tribunal is satisfied, in relation to both decisions, that there would most likely be some prejudice to Ms Clinton arising out of the delay.

Public interest considerations

1. Timeframes for initiating legal proceedings serve a useful public purpose.  This principle is particularly relevant and important in the child support jurisdiction.  Very often parents affected by Child Support Agency decisions have limited financial resources and make financial decisions based on the decisions made by the Child Support Agency.  This is the case whether the parent is a payee or a payer.  When those decisions are overturned there can be significant financial repercussions for the parents.  Lengthy delays in decision making can result in significant hardship especially where debts are raised.  In turn, this can have a significant effect, including financial repercussions on the children subject to the assessment.  There are therefore sound public policy reasons for imposing a time limit on objections to decisions.  A time limit reduces uncertainty in relation to the financial circumstances of the parties. In addition, the public has an expectation that unless there is a very good reason, timeframes will generally be observed.  This factor weighs against an extension of time in relation to both decisions.

Merits of the case

1. In considering the merits of the case, it is not appropriate for the Tribunal to form a conclusive view in extension of time proceedings.  Rather, the Tribunal needs to consider whether Mr Clinton has an arguable case if the evidence he provides is accepted.

2. In relation to the decision of 11 October 2016 the Tribunal considers that Mr Clinton’s case would appear not to be strong. Mr Clinton told the Tribunal that relying on his 2015/2016 taxable income in relation to calculating his child support liability was futile because he had no financial resources to pay child support based on his 2015/2016 income which was later confirmed by the Australian Taxation Office to be $110,257.  However, the amount of $55,000 which Mr Clinton supplied as his 2015/2016 taxable income was clearly incorrect.  In those circumstances the Tribunal considers that the merits of Mr Clinton’s case are not strong.

3. In relation to the decision of 27 September 2017 - which related to Mr Clinton lodging an estimate of nil on 15 February 2017 - Mr Clinton stated that his year to date income was nil as was his income going forward to the end of the financial year.[7]   However, the Australian Taxation Office confirmed on 27 September 2017 that Mr Clinton actually earned $20,470 in the 2016/2017 year.  Hence, additional child support was payable of $2,050.87 as a result of the reconciliation process.  There would not appear to be any error in the decision of 27 September 2017 and so the objection would not appear to have merit

   [7] C1:52

Conclusion

1. The Tribunal acknowledges that Mr Clinton holds a genuine view that he was unfairly treated at a time when he was struggling financially.  He stated that it would have been helpful if he could have received more assistance from the Child Support Agency about his options and their processes.

2. However, in considering his applications for extensions of time to object to the decisions of 11 October 2016 and 27 September 2017, and in weighing all of the relevant factors, the Tribunal is satisfied that Mr Clinton’s reasons for the delay are not compelling; he rested on his rights to some extent and there would appear to be limited merit to his objections. In addition, there will likely be some prejudice to Ms Clinton and some policy reasons militating against granting extensions of time.

3. The Tribunal therefore does not consider that in all of the circumstances it would be fair and equitable to grant extensions of time to object to the decisions of 11 October 2016 and 27 September 2017 and therefore Mr Clinton’s applications for extensions of time to object are refused.

DECISIONS

The decisions under review are affirmed.