Daly and Secretary, Department of Family and Community Services
[2004] AATA 1309
•24 November 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 1309
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2004/967
GENERAL ADMINISTRATIVE DIVISION ) Re DANIEL DALY Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Mr S. Webb, Member Date24 November 2004
PlaceSydney
Decision The decision under review is set aside for the reasons given orally at the conclusion of the hearing. In substitution thereof the Tribunal decides that Mr Daly is eligible for family tax benefit in relation to his three children at the rate of 15 percent during the 2002-2003 income year. The matter is remitted to the Respondent to calculate the amount of family tax benefit that is payable to Mr Daly in accordance with these reasons.
..............................................
Mr S. Webb, Member
CATCHWORDS
SOCIAL SECURITY - family tax benefit – eligibility - family tax benefit child – pattern of care - 10 percent threshold of care – family tax benefit percentage - decision set aside
A New Tax System (Family Assistance) Act 1999 ss 21, 22, 25, 59
A New Tax System (Family Assistance) (Administration) Act 1999 ss 108, 109A, 109D, 111B, 142, 151
Administrative Appeals Tribunal Act 1975 s 41
Elliott v Secretary, Department of Social Security and Another (1996) 134 ALR 439
Secretary, Department of Social Security v Field (1989) 18 ALD 5
Re Nowicz and Secretary, Department of Family and Community Services (2001) 65 ALD 314
Re May and Secretary, Department of Family and Community Services and Anor [2003] AATA 1201
Re Munn and Secretary, Department of Family and Community Services [2000] AATA 141
Re Plowright and Secretary, Department of Family and Community Services [2000] AATA 840
REASONS FOR DECISION
December 2004 Mr S. Webb, Member 1. Daniel Daly is seeking relief from a decision by the Respondent Secretary to reject his claim for payment of family tax benefit during the 2002-2003 income year. That decision was affirmed on review and was subsequently affirmed by the Social Security Appeals Tribunal.
2. The matter came on for hearing in Sydney on 24 November 2004. Mr Daly was unrepresented at the hearing and gave oral evidence. Ms Tracy Hennen gave oral evidence by telephone. The Respondent Secretary was represented by Mr G. Lozynsky, Centrelink Service Recovery Team. Materials were tendered and labelled as exhibits at the hearing.
3. I note in passing that prior to the hearing Ms Hennen was sent a letter by the Tribunal asking if she wanted to be joined in these proceedings. No response was received. Communications subsequently ensued with Ms Hennen concerning her availability to give evidence in which she did not seek to be joined in these proceedings.
4. My decision was delivered orally at the conclusion of the hearing. The Secretary, Department of Family and Community Services (“the Secretary”) requested written reasons on 2 December 2004. Written reasons follow that are consistent with the oral reasons already given. I note that the extempore decision specified a date of effect that was in error. The date specified was the date of Mr Daly’s application and not the effective date of this decision. Following the slip rule, that error is rectified herewith.
factual context
5. The following facts arise from the materials placed before me and are not in dispute.
6. Mr Daly was previously married to Ms Hennen. There were three children of that marriage: Tarryn Louise Dale (date of birth: 21 January 1988), Kelsie-Lee Daly (date of birth: 2 November 1989) and James Anthony Daly (date of birth: 30 September 1991). The marriage broke down and Mr Daly and Ms Hennen separated on or about 11 March 1992 (T3 folio 10).
7. On 24 October 2002 Mr Daly lodged a claim for payment of FTB in relation to his three children, claiming they were in his care for 33 percent of the time (T6 folio 24).
8. On 19 November 2002 Ms Hennen lodged a Family Assistance Office form setting out information about the shared care of the three children in question, stating that she had care of the children “approx 100%” of the time (T9 folio 44).
9. On the same day the Family Assistance Office decided to reject Mr Daly’s FTB claim “because you do not have any qualifying dependent children” (T10 folio 49) and Mr Daly requested a review of that decision (T11). Subsequently, on 27 November 2002 Mr Daly requested a review of the decision by an Authorised Review Officer ((T13 and T14).
10. The primary decision maker affirmed the decision to reject Mr Daly’s FTB claim on 6 December 2002 (T15 and T16) and on 21 January 2003 an Authorised Review Officer affirmed the decision (T22 and T23).
11. Mr Daly lodged a new claim for FTB in relation to his three children on 14 January 2004 (T24).
12. On 4 February 2004 Mr Daly applied to the Social Security Appeals Tribunal for a review of the decision to reject his FTB claim.
13. On 11 February 2004 the Family Assistance Office decided to reject Mr Daly’s second claim for FTB because “you do not have any qualifying dependent children” (T38).
14. On 1 July 2004 the Social Security Appeals Tribunal decided to affirm the decision to reject Mr Daly’s first claim for FTB (T2).
15. Mr Daly applied for review by the Administrative Appeals Tribunal (“the Tribunal”) on 2 August 2004 (T1).
legal principles
16. Mr Daly’s application arises under s 142 of the A New Tax System (Family Assistance)(Administration) Act 1999 (“the Administration Act”) and Part 3 of the A New Tax System (Family Assistance) Act 1999 (“the FA Act”). Under the FA Act, relevantly, a person may be eligible for payment of family tax benefit (“FTB”) if the person has at least one FTB child pursuant to ss 21 and 22. A child is an FTB child of a claimant, inter alia, if the claimant is legally responsible for the day to day care of the child and the child is in the claimant’s care (ss 22(2)). Furthermore, if the Secretary, or in those shoes this Tribunal, is satisfied that there is a pattern of care for the child whereby the child is in the care involving of claimant and one or more other carers for FTB purposes during a period of time, the child is to be taken to be the FTB child of the claimant, inter alia, if the child is in the care of the claimant for not less than 10 percent of the period (ss 22(7) and 25(1)).
17. In circumstances in which a child is the FTB child of two (or more) people who are not partners, the Secretary may determine the percentage of FTB that is to apply.
issues for determination
18. The issue for determination in this matter is whether Mr Daly is eligible for payment of FTB during the 2002-2003 income year, and if so the FTB percentage that is to apply.
19. I note in passing that Mr Daly’s second claim for FTB in 2004 is not before me in these proceedings.
discussion of the issues and findings
20. Making this decision I have carefully considered all of the evidence, the submissions of the parties, relevant legislation and caselaw.
21. In order to address the issue of Mr Daly’s eligibility it is necessary to determine whether he has a pattern of care for one or more of his children for more than 10 percent of the time.
22. I am satisfied that Tarryn, Kelsie and James were FTB children of Ms Hennen and were under 18 during all relevant periods.
23. The evidence is that Mr Daly and Ms Hennen separated in 1992 and have remained so during all relevant periods. I so find. An arrangement for the shared care of the children and the payment of child support was agreed by Mr Daly and Ms Hennen after their separation. There is no evidence of a court order being made in relation to those or any other arrangements of relevance in the material that is before me.
24. Mr Daly was injured at work in 1995 and his ability to earn income in employment reduced. Thereafter, he had difficulty making child support payments and adequately providing for his children during periods when they were in his care. Mr Daly’s evidence was that he was awarded “single man’s compensation” and was unable to work because of his injury. He received lump sum compensation in or about March 2003.
25. Ms Hennen’s evidence was that there were extended periods of up to six months when Mr Daly would not see his children and would not pay child support. That may be so prior to the period in question, but it is not necessary for me to make any findings concerning prior periods. I note that Ms Hennen did not keep a record of care in relation to Tarryn, Kelsie and James during the 2002-2003 income year and adduced no evidence to support her contention that she had care of the children for “99 percent” of the time in the period from July to December 2002.
26. On the basis of a diary of care Mr Daly kept during the 2002 calendar year, I accept that he had care of his three children for 17 days in July 2002, 11 days in August 2002, 2 days in September 2002, 5 days in October 2002, 4 days in November 2002 and 6 days in December 2002.
27. Ms Hennen accepted that Mr Daly had care of his three children every second weekend, on occasional days during the week and for half of the school holidays from March 2003, ongoing. I so find.
28. Consistent with the concept of joint parental responsibility in relation to children I am satisfied that Ms Hennen had legal responsibility for the care, well-being and development of the children for the periods of time that they were in her care and that Mr Daly had legal responsibility for the care, well-being and development of the children for the periods of time that they were in his care (see Elliott v Secretary, Department of Social Security and Another (1996) 134 ALR 439 at 444; Secretary, Department of Social Security v Field (1989) 18 ALD 5 at 8)
29. I am satisfied, on the balance of probabilities, that Mr Daly had a pattern of care for his three children for periods during the 2002-2003 income year pursuant to ss 22(7). That pattern of care involved care of his three children on every weekend and some days during the week in July and August 2002 and from March 2003 on at least every second weekend, on Tuesdays or Wednesdays for at least part of the day, and for at least half of the school holidays. I accept that as a result of his financial difficulties there were periods in that year, between September 2002 and March 2003, when Mr Daly did not maintain a consistent pattern of care. However, as will appear that disruption to the pattern of care for his children does not extinguish his claim for FTB but it does go to the amount of FTB that is payable (Re Nowicz and Secretary, Department of Family and Community Services (2001) 65 ALD 314 at 318; Re May and Secretary, Department of Family and Community Services and Anor [2003] AATA 1201 at 32). The disruption was temporary and his care responsibilities continued during that period, albeit in significantly reduced circumstances.
30. In the circumstances of the evidence presently before me I am satisfied that Mr Daly had a pattern of care for his children during the 2002-2003 income year but the pattern varied from time to time. Essentially, his pattern of care from 1 July to 31 August 2002 was at a higher level that from 1 September 2002 to 28 February 2003, which was at a lower level that from 1 March 2003 to 30 June 2003. I so find.
31. The evidence is that during those periods the children were in his care for more than 10 percent of the time. In July and August 2002 the children were in Mr Daly’s care for approximately 45 percent of the time (28 days). From 1 September to 31 December 2002 they were in his care for approximately 14 percent of the time at least (17 days). There is no reliable evidence concerning the number of days the children were in Mr Daly’s care in January and February 2003. However, on the basis of his care arrangements over the preceding four months and the oral evidence of Ms Hennen and Mr Daly, I accept that it is probable that he had care of the children for at least 3 days in each of January and February 2003, that is, approximately 10 percent of the time. From 1 March to 30 June 2003 I accept that Mr Daly had the care of his children for approximately 19 percent of the time (at least 23 days).
32. I note in passing the evidence of Mr Daly and Ms Hennen that the children made their own arrangements with Mr Daly, on a day-to-day basis, whenever they wanted to stay with him or for him to be involved in some way in activities they were planning, such as school transport arrangements, out of school activities, visits or friends staying over.
33. That informal arrangement is characteristic of the pattern of care Ms Hennen and Mr Daly engaged in. Commonsense stipulates in such cases that flexibility is required. Minor divergences from or variations in the pattern of care should not disadvantage either party in relation to FTB and, in the specific circumstances of this case, should not cause any variation in the rate of FTB that is payable.
34. Turning to consider the relevant legislation, I am satisfied that Tarryn, Kelsie and James were the FTB children of Mr Daly during the 2002-2003 income year pursuant to ss 22(2) and (7). I note that while the children were in Mr Daly’s care for only parts of the periods in question, ss 22(7) provides, in effect, that the children are taken to be his FTB children on each day during those periods whether or not they were in Mr Daly’s care so long as there was a pattern of care whereby Mr Daly had care of the children for at least 10 percent of the time. I am satisfied that he did have care of the three children for at least the requisite amount at all material times in the 2002-2003 income year and so find.
35. It remains for me to determine the appropriate rate of FTB that is payable to Mr Daly pursuant to s 59 of the FA Act. I accept Mr Daly’s evidence that, when the three children were in his care during the 2002-2003 income year, he provided shelter, food, drink, clothing and recreational activities at his cost. As a matter of policy FTB is intended to assist with such essential costs of caring for children. It is appropriate, therefore, to consider the proportionality of FTB payments on the basis of temporal as well as financial factors (Re Munn and Secretary, Department of Family and Community Services [2000] AATA 141 at paragraph 21; Re Plowright and Secretary, Department of Family and Community Services [2000] AATA 840 at paragraphs 19 to 22).
36. In the particular circumstances of this case, and especially in light of the informal arrangements Ms Hennen and Mr Daly have made for the care of Tarryn, Kelsie and James, I do not consider it is appropriate to calculate the rate of FTB payments on the basis of variations in Mr Daly’s pattern of care of the children during the 2002-2003 income year. To do so would not properly reflect the overall proportionality of responsibilities and costs between Ms Hennen and Mr Daly during the specific periods or the year in question as a whole. It is preferable in the circumstances, especially in the consideration of a past period which concluded almost 18 months ago, to determine Mr Daly’s FTB percentage for the entire period during which the children were his FTB children.
37. On a temporal basis, it appears that Mr Daly had care of his FTB children for approximately 20 percent of the time overall during the 2002-2003 income year. However, I accept that Ms Hennen carried an additional financial burden than Mr Daly, in relation to the purchase of clothing for example, during the year in question. By Mr Daly’s own account he had significant difficulty affording the care of his children prior to March 2003 and for that reason his pattern of care reduced in the period from September 2002 to March 2003.
38. Weighing all of the temporal and financial factors, I am reasonably satisfied that it is appropriate to determine that Mr Daly’s FTB percentage is 15 percent during the 2002-2003 income year.
39. In submissions for the Respondent Secretary it was contended that the date of effect of a decision favourable to Mr Daly could not take effect prior to the date on which he applied to the Social Security Appeals Tribunal, that is, on 4 February 2004. As will appear, I do not agree.
40. In the Secretary’s submission Mr Daly applied to the Social Security Appeals Tribunal more than 52 weeks after the date of the Authorised Review Officer’s decision, therefore offending against the time limit imposed by s 109D of the Administration Act. However, s 109D applies a 52 week time limit to an application for review of a decision under s 109A. Section 109A is concerned with applications to the Secretary for review of, inter alia, “a decision of any officer under the family assistance law” (ss 108(a)), as follows:
“(1) A person affected by a decision (the original decision) that, under section 108, must be reviewed under this section, may apply to the Secretary for review of the decision.
(2) If the person does so, the Secretary must either:
(a) review the original decision and decide (the review decision) to:
(i) affirm it; or
(ii) vary it; or
(iii) set it aside and substitute a new decision; or
(b) arrange for an authorised review officer (see section 109C) to do so.
(3) If:
(a) the person who reviews the decision (the decision reviewer) makes a review decision to set aside an original decision; and
(b) the decision reviewer is satisfied that an event that did not occur would have occurred if the original decision had not been made;
the decision reviewer may, if satisfied that it is reasonable to do so, deem the event to have occurred for the purposes of the family assistance law.
(4) If:
(a) a person who may apply to the Secretary for review of a decision under subsection (1) has not done so; and
(b) the person applies to the SSAT for review of the decision (despite not being entitled to do so);
the person is taken to have applied to the Secretary for review of the decision under subsection (1) on the day on which the person applied to the SSAT.”
Plainly, s 109A does not include applications for review of a decision of an Authorised Review Officer by the Social Security Appeals Tribunal. The relevant provisions concerning the date of effect of decisions of the Social Security Appeals Tribunal are set out at Part 5 Division 2 of the Administration Act, particularly s 111B.
41. The fact is that the Social Security Appeals Tribunal affirmed the primary decision, whereby pursuant to s 142 and 151 of the Administration Act and s 41 of the Administrative Appeals Tribunal Act 1975, the decision presently under review is the “original decision that was reviewed by the Social Security Appeals Tribunal” (ss 151(3)). It follows that the time limit of the date of effect of this decision that was contended for by the Secretary does not apply. The decision has effect from the date the original decision would have had effect. In this case that is from 1 July 2002, being the first day of the income year in question. I so find.
decision
42. The decision under review is set aside for the reasons given orally at the conclusion of the hearing. In substitution thereof the Tribunal decides that Mr Daly is eligible for family tax benefit in relation to his three children at the rate of 15 percent during the 2002-2003 income year. The matter is remitted to the Respondent to calculate the amount of family tax benefit that is payable to Mr Daly in accordance with these reasons.
I certify that the 42 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member
Signed: Z. Khan
AssociateDate/s of Hearing 24 November 2004
Date of Decision 24 November 2004
Representative for the Applicant Self - represented
Solicitor for the Respondent Mr George Lozynsky
2
4
0