Conley & Goff
[2024] FedCFamC2F 1332
•1 October 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Conley & Goff [2024] FedCFamC2F 1332
File number(s): DGC 3300 of 2023 Judgment of: JUDGE JENKINS Date of judgment: 1 October 2024 Catchwords: FAMILY LAW – CHILD SUPPORT – Child support agreement – parents intended for it to be a binding child support agreement – application by father to set it aside due to hardship – application by mother to enforce – agreement not a binding child support agreement due to non-compliance with section 85 of the Child Support (Assessment) Act – agreement unenforceable because not accepted by the child support registrar – both applications dismissed . Legislation: Child Support (Assessment) Act 1989 (Cth) ss 7(b), 12(2), 12(2AA), 80C, 80CA, 81(2), 85, 136
Family Assistance and Child Support Legislation Amendment (Protecting Children) Act 2018 (Cth)
Cases cited: Masters & Cheyne [2016] FamCAFC 255 Division: Division 2 Family Law Number of paragraphs: 31 Date of hearing: 16 & 17 July 2024 Place: Dandenong Representative for the Applicant: The father appearing in person Counsel for the Respondent: Ms James Solicitor for the Respondent: Andropoulos & Associates ORDERS
DGC 3300 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR CONLEY
Applicant
AND: MS GOFF
Respondent
ORDER MADE BY:
JUDGE JENKINS
DATE OF ORDER:
1 OCTOBER 2024
THE COURT ORDERS THAT:
1.All extant applications are dismissed.
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 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE JENKINS:
The parties, Mr Conley (“the father”) and Ms Goff (“the mother’) entered into what they believed to be a binding child support agreement (“the agreement”) on 8 October 2019 in relation to their one child, X.
The father complied with the terms of the agreement between October 2019 and 23 May 2023 when he unilaterally ceased making the payments.
The father subsequently filed his application in these proceedings seeking to set aside the agreement. His case is that he has found himself in a dire financial situation as a result of events that were entirely unforeseeable at the time of the agreement. He argues these circumstances are exceptional and that if he were required to comply with the agreement it would cause him hardship.
The mother seeks that the father’s application be dismissed and the father pay the arrears owing by way of a lump sum payment.
However, as I have determined that the agreement was not a binding child support agreement, both applications must fail.
BRIEF BACKGROUND
The parties were in a de facto relationship from 2006 until they separated on 16 April 2019.
The parties’ child, X was born in 2008 and therefore has just turned 16 years of age.
The parties entered into final property orders by consent on 8 October 2019 where it is common ground that they provided for the applicant father to receive 62.7% of the assets and the respondent mother to receive 37.3%. It appeared to be common ground that this split was on the basis that the father had brought into the relationship greater assets than the mother.
On the same day as they entered into the final property orders, the parties signed the agreement which provided for the mother to receive periodic child support of $2,083.30 per month (with annual CPI increases) until the later of X turning 18 years old or completing her secondary education as well as non-periodic child support of all private school fees, education costs, private health and medical insurance, out of pocket medical, pharmaceutical, dental, optical and other reasonably incurred expenses which are not covered by Medicare or private health insurance.
As already indicated the father complied with this agreement until 23 May 2023 and then filed his application in his matter on 6 October 2023 seeking to set it aside.
THE EVIDENCE
The matter was listed for final hearing on 16 and 17 July 2024.
Each of the parties gave evidence followed by final submissions.
Neither party identified what I have ultimately determined to be a fatal flaw in both of their applications, being that the agreement was not in fact a binding child support agreement.
Accordingly, the matter was conducted on the basis that the agreement should either be set aside or enforced.
THE LAW
What constitutes a binding child support agreement?
Section 80C of the Child Support (Assessment) Act1989 (Cth), (“the Act”) states as follows:
(1) An agreement is a binding child support agreement if:
(a) the agreement is binding on the parties to the agreement in accordance with subsection (2); and
(b) the agreement complies with subsection 81(2).
(emphasis added)
Section 81(2) of the Act states as follows:
An agreement is a binding child support agreement or a limited child support agreement if it complies with the following provisions:
(a) section 82 (children in relation to whom agreements may be made);
(b) section 83 (persons who may be parties to agreements);
(c) section 84 (provisions that may be included in agreements);
(d) section 85 (child support agreement must not provide for person who is not eligible carer to be paid child support).
(emphasis added)
Section 85 of the Act states as follows:
(1) An agreement is not a child support agreement in relation to a child if (disregarding section 67A) the agreement provides that a party to the agreement is to pay or provide child support for the child to another party for a period during which the party is not an eligible carer of the child.
(2) Subsection (1) does not affect the operation of the agreement for any other purpose.
Section 85 was inserted into the Act in 2018 pursuant to the Family Assistance and Child Support Legislation Amendment (Protecting Children) Act 2018 (Cth). This amendment arose following the decision of the Full Court in Masters & Cheyne [2016] FamCAFC 255 (“Masters & Cheyne”). In that case, the parties entered into a binding child support agreement for the mother to be paid child support in circumstances where the children were living primarily with the mother. By the time of the hearing, the one remaining child under 18 years was living with the father six nights each week and the mother one night. However, as a result of amendments to the Act made subsequent to the parties entering into the agreement, the father was required to continue paying child support to the mother.
At the time of the agreement in Masters & Cheyne, section 12(2)(b) of the Act provided that child support terminates if the person entitled to child support ceases to be an “eligible carer”[1]. However, the amended section 12(2AA), applicable at the time of the proceedings provided that the agreement would only terminate if, both parents ceased to be eligible carers.
[1] See section 7(b) of the Child Support (Assessment) Act 1989 (Cth) (“the Act”).
The trial judge in Masters & Cheyne dealt with this seeming inequity by finding that there were exceptional circumstances and that the father would suffer hardship if the agreement were not set aside. Although, I note that the Full Court ultimately allowed the appeal by the mother in that matter on the basis that it was not open for the Court to find hardship.
Subsequently, section 85(1) was introduced to prevent this situation from occurring in future.
THE AGREEMENT
Unfortunately, the agreement in this case included the following clause at 8(b):
In the event that [Ms Goff] [the mother] ceases to be an eligible carer in respect of the child, then, with the exception of any arrears owing to [Ms Goff] as at that date, the parties hereby agree that:
(iii) non-periodic maintenance payable pursuant to this Agreement shall remain payable by [Mr Conley] [the father];
(emphasis added)
Nonetheless, neither party was aware there was an issue with the agreement until the mother sought to register it with Services Australia in late 2023, so it could be enforced. The mother’s evidence is that at that time she was informed that it could not be accepted because of clause eight.
Despite this, counsel for the mother argued the issue could be cured by the court making orders directing the parties to severe that clause from the agreement so it would be accepted by Services Australia. In essence it was argued this would be a machinery order to give effect to clause 11, which required the parties to do all things necessary to give effect to the agreement, including the execution of a further agreement in like terms if required by the child support registrar.
However, in my view, the removal of the offending clause would not render it an agreement in “like terms” but would constitute a variation to the agreement and section 80CA of the Act makes it clear that it is not possible to vary a binding child support agreement.
Counsel for the mother also sought to argue that the agreement was enforceable pursuant to section 85(2) because it “otherwise complied with the legislative requirements” for the agreement to be binding. However, no authority was provided to support this submission, which is in clear contradiction to a plain reading of section 85(1) of the Act.
DETERMINATION
The inclusion of clause 8 in the agreement means that the agreement does not comply with section 85 of the Act and is therefore, not a binding child support agreement.
As there is no binding financial agreement, it can neither be set aside or enforced and both applications before the court must fail.
This is most unfortunate where the intention of the parties was clearly to enter into a binding child support agreement in the terms set out in the agreement, each party believed it was binding, and the father only ceased paying because he asserts that he could not afford to make the payments.
It is also unfortunate given the father appears to have had more than sufficient funds to continue to pay the child support in that agreement. In this regard, I firstly note that X ceased attending private school at the start of 2023, reducing the father’s commitment by some $30,000 per year. Secondly, the father’s own evidence was that after he ceased paying child support he lent his other daughter almost $60,000 (a loan he ultimately forgave), bought X a car she could not yet legally drive, continued to pay for his sports membership (and for sports trips to other exclusive locations), continued to pay fees for multiple investments, travelled overseas, and sent approximately $16,000 to his new wife’s family in Country B.
Nonetheless, for all of the aforementioned reasons all applications in this matter will be dismissed.
I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Jenkins. Associate:
Dated: 1 October 2024
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