Dutton and Dietz (Child support)

[2022] AATA 3057

Dutton and Dietz (Child support) [2022] AATA 3057 (27 July 2022)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2020/MC020091

APPLICANT:  Mr Dutton

OTHER PARTIES:  Child Support Registrar

Ms Dietz

TRIBUNAL:Senior Member J Longo

DECISION DATE:  27 July 2022

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that the objection is allowed so as to determine:

·From 15 May 2019 to 8 July 2020, Mr Dutton’s adjusted taxable income is varied to $214,000 per annum;

·From 9 July 2020 to 30 June 2023, Mr Dutton’s adjusted taxable income is varied to $36,348 per annum.

CATCHWORDS

CHILD SUPPORT – departure determination – income, property and financial resources of the liable parent – a ground for departure established – decision to depart – decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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.    The issue to be determined in this application is whether there is a reason to change the administrative assessment of child support and whether it is just and equitable and otherwise proper to do so.

2.    Mr Dutton and Ms Dietz are the parents of [Child 1]. Mr Dutton is the parent liable to pay child support. The application for child support was registered Services Australia – Child Support (the Agency) from 17 November 2017 and is currently subject to Agency collection. Ms Dietz has 100% care of [Child 1] according to the Agency information provided.

3.    Prior to the current application for a departure determination, on 1 August 2019 the Agency made a departure determination which varied Mr Dutton’s adjusted taxable income to $86,925 for the period from 17 February 2019 to 16 February 2021.

4.    Both Mr Dutton and Ms Dietz objected to the decision of the Agency. On 28 October 2019, the Agency allowed Ms Dietz’s objection and made a departure determination which varied Mr Dutton’s adjusted taxable income to $214,000 for the period from 15 May 2019 to 11 August 2022.

5.    On 21 May 2020, Mr Dutton applied for a departure from the administrative assessment on the basis that, in the special circumstances of the case, the administrative assessment of child support was not reflective of his income, property and financial resources (Reason 8A) as his businesses were no longer operating and he was in receipt of jobseeker payment. On 30 July 2020 the Agency refused to change the administrative assessment on the basis that no ground for departure was established.

6.    Mr Dutton sought further review and lodged objections to the Agency’s decision on 21 August 2020. On 16 October 2020, the Agency disallowed Mr Dutton’s objection on the basis that no ground for departure was established.

7.    On 21 October 2020, Mr Dutton lodged an application to this Tribunal for an independent review of the objections officer’s decision. The application proceeded to a telephone directions hearing on 30 November 2020 and a substantive hearing of the application was commenced on 10 February 2021. The hearing of the evidence was not concluded on this day and a further hearing was required. Unfortunately, the member that was constituted to hear and determine the application was no longer available and the matter was constituted to another member of the Tribunal.

8.    The Tribunal, as newly constituted, attempted to schedule a hearing for this matter on a number of separate occasions. However, due to ongoing lockdowns experienced in Victoria throughout 2021 due to the COVID-19 pandemic, the matter was further delayed. An attempt to have the matter heard on 10 November 2021 did not proceed and the matter was rescheduled for 9 December 2021. Further circumstances relating to the COVID-19 pandemic, including further lockdowns, prevented the matter proceeding to hearing until 22 March 2022.

9.    This case was further complicated by the existence of another departure determination made by the Agency, which is unrelated to the present matter, but for which Mr Dutton was also the applicant. While the second application does not in any way relate to the present application, the second matter was constituted to be heard contemporaneously with the present matter so that Mr Dutton’s evidence, which directly related to both applications, could be heard and considered in the context of both applications.

10.  On 22 March 2022, Mr Dutton appeared in person before the Tribunal to give oral evidence together with his legal representative, [Representative A]. Ms Dietz participated by telephone to give oral evidence together with her legal representative, [Representative B].

11.  The Tribunal considered the documents and information, including the oral evidence of Mr Dutton and Ms Dietz, which were provided to all the parties prior to the hearing.[1] After the hearing, further directions were made for the provision of additional information and submissions.[2] Additional information was provided by both parties. Relevant aspects of the evidence and material before the Tribunal will be referred to in the Tribunal’s decision.

CONSIDERATION

The legislative framework and issues for the Tribunal to determine

[1] Subsection 37(1) and section 38AA statement and documents provided by the Agency numbered 1 to 751; Mr Dutton’s documents numbered A1 to A384; Ms Dietz’s documents numbered B1 to B20.

[2] Mr Dutton’s documents numbered A385 to A595; Ms Dietz’s documents numbered B21 to B68.

12.The rate of child support payable by a liable parent is usually based on an administrative assessment under Part 5 of the Child Support (Assessment) Act1989 (the Act). The liable parent or a carer may apply to the Child Support Registrar for a determination to depart from the child support administrative assessment under Part 6A of the Act. Section 98C provides that the Registrar may make a determination to depart from the formula assessment and establishes a three-step process. The Registrar, and the Tribunal standing in place of the Registrar, must be satisfied: there is a ground for a departure from the administrative assessment; that it is just and equitable to depart; and that it is otherwise proper. The grounds for departure from an administrative assessment of child support are those set out in subsection 117(2) of the Act.

13.If satisfied that a ground or grounds exist and that it would be just and equitable and otherwise proper to make a particular determination, the Tribunal may make one of the determinations prescribed in section 98S of the Act.

Issue 1 – Is there a ground to depart from the administrative assessment of child support?

Reason 8: Mr Dutton’s income, property, financial resources and earning capacity – relevant law, evidence and contentions

14.The primary focus of proceeding, both before the Agency and the Tribunal, has been on Mr Dutton’s income, property and financial resources and earning capacity (collectively referred to as ‘Reason 8’). For the following reasons, the Tribunal considered the ground known as Reason 8 is established on the evidence.

15.Subparagraph 117(2)(c)(ia) of the Act provides for a ground for departure from an administrative assessment on the basis of a parent’s income, property or financial resources, as raised in Mr Dutton’s application. The Act states as follows:

(c) that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:

…

(ia) because of the income, property and financial resources of either parent.

(ib) because of the earning capacity of either parent;

16.The term “special circumstances” is not defined in the Act. In Gyselman v Gyselman (1992) FLC 92-279 the Full Family Court indicated that for there to be special circumstances, the facts of the case must establish something which is special or out of the ordinary.

17.In considering the above, the Tribunal is mindful of the requirement of satisfying subsection 117(7A) of the Act (in relation to a parent’s income, property and financial resources) and having regard to the capacity of the parent to derive an income but disregarding the capacity of anyone who does not have a legal duty to maintain the child.

18.Mr Dutton’s submission to the Tribunal, and previously to the Agency, was that the assessment of his income under the administrative assessment was no longer reflective of his actual circumstances. He stated at the hearing, consistent with previous statements to the Agency, that his circumstances had changed such that he should not be assessed on this basis any longer and that his circumstances changed from May 2020.

19.Mr Dutton told the Tribunal that he accepted the decision made by the Agency but that from May 2020 his circumstances changed such that his income was no longer correct. He stated that his companies closed down in May 2020 and were deregistered on 8 July 2020. He stated that the reason for this was due to increased competition in the market and health issues.

20.The Tribunal notes that Mr Dutton was operating three private companies, until these were deregistered on 8 July 2020 – [Business 1], [Business 2] and [Business 3]. Mr Dutton confirmed that he was the sole shareholder and director of these private companies. The Tribunal is satisfied, based on the company records provided, that Mr Dutton was the sole shareholder and director of [Business 1], [Business 2], and [Business 3].

21.He told the Tribunal that he was manufacturing [products 1 and 2]. He had set up his business structure through the three private companies which had different roles – [Business 3] imported stock and material from [Country 1], [Business 2] was the manufacturer of [products 1 and 2] and [Business 1] installed the [products 1 and 2]. Mr Dutton stated that due to his health issues, as well as ongoing issues with competition, these businesses, operating through these private companies, were no longer viable and competitive and so he stopped trading in May 2020 and deregistered the companies on 8 July 2020.

22.Mr Dutton stated that as a consequence of the businesses failing and no longer operating, he received jobseeker payments from 15 July 2020 until 14 March 2021 when he commenced part-time employment. Mr Dutton stated that he started working in a [occupation 1] role at [Employer 1] from 14 March 2021. It is on the basis of these changes in his circumstances that Mr Dutton relies in stating that the administrative assessment of his adjusted taxable income of $214,000 per annum from May 2020 should no longer apply.

23.The Tribunal has before it a medical report provided by [Doctor A], dated 7 October 2021, which outlined Mr Dutton’s ongoing health issues. Of note in this report is that Mr Dutton underwent surgery in February 2020 to [procedure specified]. The Tribunal has before it the [report] of [a named specialist] which confirms that [the procedure occurred] [in] February 2020. [Doctor A] further writes in the report dated 7 October 2021 that he was fit for part-time or full-time work which involved light duties – no lifting, pushing, no excessive fast pacing and minimal stress at work. [Doctor A] further lists that Mr Dutton has been diagnosed and treated for depression/anxiety and is seeing a psychologist and also taking medication, as well as being diagnosed with [another condition] and taking [a medication]. Mr Dutton confirmed at the hearing that he continues to take antidepressant medication and is seeing a psychologist every two months. He also stated that he continues to see his [specialist].

24.The Tribunal considered Mr Dutton’s income and financial resources. Mr Dutton conceded, and the Tribunal accepts, that the income assessed of $214,000 per annum was appropriate until May 2020. However, since this date it is no longer reflective of his circumstances. Mr Dutton provided bank account information and his income tax return for 2019/2020 which shows that he was in receipt of jobseeker from on or about July 2020. Mr Dutton also provided documents to show that he was employed, on a part-time basis, in [occupation 1] and administration for [Employer 1] and has been since 14 March 2021. He provided evidence to the Tribunal which shows he is working 30 hours per week on an annual salary of $36,348 and his bank account information also shows salary deposits from [Employer 1].

25.Ms Dietz did not accept Mr Dutton’s evidence regarding his current circumstances and stated that although he is no longer operating the three private companies which ran his businesses, he was still running the businesses. Ms Dietz stated that she didn’t believe that the circumstances had changed. The Tribunal’s consideration of the submissions and analysis of the issues and evidence pertaining to these submissions have formed part of the consideration of the factors on whether it is just and equitable to depart from the administrative assessment later in these reasons.

26.Mr Dutton had the benefit of the business structures which gave him the ability to determine his taxable income at a much lower level with the financial resources available in these private companies than would otherwise be the case. Mr Dutton has conceded that this was the case for some of the period but claims this is no longer the case since the private companies were deregistered. The Tribunal finds that while this may have been acceptable for taxation purposes, it did provide financial resources to Mr Dutton which would otherwise not be taken into account for child support purposes. The Tribunal finds that these arrangements existed until July 2020 and Mr Dutton has benefitted from these arrangements. These circumstances, in the Tribunal’s determination, have changed since July 2020.

27.The Tribunal determines that the subsequent changes in circumstances, in particular the deregistration of the private companies Mr Dutton controlled, Mr Dutton’s period of reliance on jobseeker and his subsequent change in employment in March 2021, are circumstances which are out of the ordinary and uncommon sufficiently to make it unjust or inequitable to determine the level of financial support to be provided on the basis of the administrative assessment of child support in place prior to the application for departure made on 21 May 2020. Accordingly, a ground for departure in subparagraph 117(2)(c)(ia) of the Act does exist and this ground is established on the basis that reliance on the adjusted taxable income of $214,000 for the period from 15 May 2019 to 11 August 2022 would not provide a just and equitable assessment of Mr Dutton’s financial support of [Child 1].

Issue 2 – Is it fair or ‘just and equitable’ in relation to Mr Dutton, Ms Dietz and [Child 1] to make a particular departure determination?

28.As the Tribunal is satisfied that there is a ground to depart from the administrative assessment of child support, the next step is to consider whether it is fair as regards the parents and the children to make a particular determination in accordance with sub-subparagraph 98C(1)(b)(ii)(A) of the Act. This in turn requires the Tribunal to have regard to a range of factors, including but not limited to those set out in subsections 117(4) and (6) to (8) of the Act, such as the needs of the children, the parents’ assets, liabilities, income and commitments and any hardship that would be caused by departing or not departing from the formula. The Tribunal does not propose to explore every matter in detail but will discuss those it regards as pertinent to this application (Gyselman).

The needs of the children

29.Section 3 of the Act makes it clear that the parents of a child have the primary duty to maintain the child, and that this duty has priority over all commitments of the parents other than commitments necessary for self-support or the support of another person the parent has a duty to maintain (Ashcroft and Ashcroft (SSAT Appeal) [2008] FMCAfam 1250). In this case Mr Dutton and Ms Dietz have the primary duty to financially support [Child 1] and contributing to her costs should take priority over all other costs other than their “necessary” costs of self-support. Mr Dutton also has a legal duty to contribute to the needs of another child from a previous relationship.

30.In determining the proper needs of the child, subsection 117(6) of the Act also requires the Tribunal to have regard to the manner in which the parents expected the child to be cared for, educated and trained as well as a consideration of any special needs of the child.

31.Ms Dietz told the Tribunal that [Child 1] has had [specified health] issues and is under the care of the [named] Hospital with reviews every few months. Ms Dietz did not indicate that there were any costs associated with these visits or [Child 1’s] health issues in the information before the Tribunal.

32.Ms Dietz estimated the weekly costs she incurs in respect of [Child 1] to be $374. This included some minor discretionary costs in respect of children’s activities ($30 per week) and entertainment ($20 per week). Mr Dutton did not provide any costs in regard to [Child 1] as he does not have her in his care. No further matters were raised in relation to the proper needs of [Child 1]. Similarly, as to the direct and indirect costs incurred by Ms Dietz in providing care for [Child 1], no matters were raised to suggest that the direct or indirect costs of providing care required any further specific analysis. The Tribunal has examined the statements of financial circumstances provided by both parties in this regard and identified nothing to justify further analysis of this factor.

The earning capacity, income, property and financial resources and commitments of each parent

Mr Dutton’s earning capacity, income, property and financial resources

33.While the Tribunal has determined that the ground for departure is established, based on Mr Dutton’s changed circumstances from July 2020, the Tribunal must still consider whether it is just and equitable, based on the parents’ assets, liabilities, income and commitments, to depart from the administrative assessment.

34.Relevant to the considerations of Mr Dutton’s earning capacity, income, property and financial resources, the Tribunal has considered Ms Dietz’s oral submissions regarding Mr Dutton’s circumstances. These oral submissions are consistent with the written submissions provided on her behalf by her legal representative. These submissions, both to the Agency and to the Tribunal, allege that Mr Dutton has alienated his business income and assets through his mother, [Mother A], to avoid his child support liability. The Tribunal finds, which was not disputed by either party in these proceedings, that Mr Dutton’s mother registered three private companies in 2019, [Business 4], [Business 5] and [Business 6], before Mr Dutton’s private companies ceased trading and were deregistered.

35.Ms Dietz submitted that Mr Dutton’s mother is elderly ([age] years of age at the time of the objection to the Agency in 2020) and speaks no English. Ms Dietz also stated in her oral evidence that Mr Dutton’s mother was not in good health and could not drive. She is aware of her circumstances as his mother was living with them during their relationship. The written submissions on behalf of Ms Dietz also refer to Mr Dutton and Ms Dietz’s lifestyle during the relationship and that Mr Dutton’s businesses enabled a high standard of living for the family.

36.Mr Dutton stated that these three private companies have operated for approximately five to six years prior to ceasing trading and the companies being deregistered. The Tribunal notes that Mr Dutton’s application for a business loan at [Bank 1] in 2018 shows [Business 1] had been trading since 2011.[3] The Tribunal also notes that there is also evidence in the Agency documents that shows that one of the private companies had a name change in 2016.[4] The Tribunal is satisfied, based on the documents provided by the Agency, that [Business 2] was registered in 2016.[5]

[3] Page 536 of subsection 37(1) statement and documents provided by the Agency.

[4] Pages 53 and 62 of subsection 37(1) statement and documents provided by the Agency.

[5] Page 60 of subsection 37(1) statement and documents provided by the Agency.

Income

37.At the time of the hearing Mr Dutton’s evidence was that he was employed, on a part-time basis, in [an occupation 1] and admin role with [Employer 1]. Mr Dutton’s evidence was that he commenced in this role in March 2021. The Tribunal has before it payslips[6] provided by Mr Dutton which show an annual salary of $36,348. These are consistent with the contract of employment[7] provided to the Tribunal.

[6] Pages A378, A382 to A384 of Mr Dutton’s documents.

[7] Pages A374 to A376 of Mr Dutton’s documents.

38.In his oral evidence, Mr Dutton described only brief and intermittent work since he ceased work through his previous private companies, for example undertaking installation work for his mother’s private companies.

39.Mr Dutton’s 2019/2020 taxable income was $11,310[8] and his 2020/2021 taxable income was $32,749[9] with income sourced from salary allowances from [Employer 1] of $14,693 and from income support payments of $17,979 – with nominal deductions.

[8] Pages A316 to A321 of Mr Dutton’s documents.

[9] Pages A309 to A315 of Mr Dutton’s documents.

40.Given the evidence regarding the substantial change to Mr Dutton’s circumstances recounted above concerning the cessation of his private companies, the Tribunal is satisfied that in terms of his direct income from the date of that event, his annual salary from [Employer 1] of $36,348 is essentially an accurate measure of his personal direct income.

Property and financial resources

41.Turning to consider Mr Dutton’s interest in his mother’s private companies, [Business 4], [Business 5] and [Business 6], as a financial resource for Mr Dutton, on the basis that he has alienated personal income and assets through private companies held by his mother, this submission is that Mr Dutton’s mother, due to her age, English capacity and general health was not able to direct the private companies in which she was director and shareholder but rather they were directed by Mr Dutton who retained the benefit from these private companies. The Tribunal also notes the oral evidence of Mr Dutton which confirmed that the private companies that his mother was sole shareholder and director of leased the same premises that Mr Dutton’s private companies were leasing prior to deregistration. In addition, Mr Dutton was signatory to his mother’s private companies’ bank accounts.[10]

[10] Page 376 of subsection 37(1) statement and documents provided by the Agency.

42.For reasons that follow, the Tribunal has formed the view that Mr Dutton has historically alienated income, property and financial resources through the structures of his private companies [Business 1], [Business 2] and [Business 3]. This was not disputed by Mr Dutton, in that he was not contesting the decision of the Agency prior to May 2020. The Tribunal has not formed such a view in regard to [Business 4], [Business 5] and [Business 6] for the following reasons.

43.The Tribunal notes that [Mother A] was the sole director and secretary of [Business 4], [Business 5] and [Business 6], and was the sole shareholder until 2 December 2020 when the shares in these private companies were sold to a third party.

44.The Tribunal notes that these private companies operated from the same premises as Mr Dutton’s private companies. Mr Dutton was a signatory to all of the accounts for his mother’s private companies. While Mr Dutton told the Tribunal that the private companies of which he was director and shareholder manufactured and installed [products 1 and 2], he stated that his mother’s private companies manufactured and installed [related products]. Notwithstanding this distinction, Mr Dutton also told the Tribunal that he did, on occasion, do installation work for customers of his mother’s private companies and also sold stock to his mother’s private companies.[11] To complicate matters further in terms of identifying what financial resources within [Business 4], [Business 5] and [Business 6] ought to be considered to be Mr Dutton’s financial resources, the documents before the Tribunal, as stated above, show that the private companies were sold by Mr Dutton’s mother in December 2020 to a third party. Furthermore, these private companies have now been deregistered.[12]

[11] Pages A200 to A204 of Mr Dutton’s documents.

[12] Pages A196 to A198 of Mr Dutton’s documents.

45.It is clear from an analysis of the limited financial information and evidence before the Tribunal that the financial operation of [Business 4], [Business 5] and [Business 6] was irregular, in the sense that they were by no means arm’s length from Mr Dutton and members of his family.

46.However, the Tribunal is unable to conclude that all wealth and financial resources for [Business 4], [Business 5] and [Business 6] came from Mr Dutton’s personal services. Even if the Tribunal was able to form such a view for child support purposes, it is impossible to identify what, if any, ‘wealth’ was in these companies at any material time, and what, if any, benefit Mr Dutton has received. There is no evidence of transfer of funds from the private companies of which Mr Dutton’s mother was director and shareholder to Mr Dutton. These private companies, as far as evidenced in the documents before the Tribunal, have not made payments on Mr Dutton’s behalf towards his various outstanding liabilities, which include mortgages over his home and various credit cards.

47.The Tribunal notes, in particular, that the mortgages held by [Bank 1] over Mr Dutton’s home have remained unpaid since at least March 2020. Mr Dutton provided evidence that the mortgagor ([Bank 1]) has initiated legal proceedings for foreclosure and sale of the property which is security for these loans. Mr Dutton’s statement of financial circumstances also indicated various credit card debts remain outstanding and he has provided bank statements which confirm these debts remain unpaid. Ms Dietz alleged that Mr Dutton has property interests overseas and has also transferred funds overseas. There is no evidence before the Tribunal that substantiates this allegation. None of Mr Dutton’s personal accounts show such transfers. While Mr Dutton’s private companies, and indeed the private companies of his mother, did make overseas payments, Mr Dutton stated that these were in relation to materials purchased overseas.

48.From 8 July 2020, the Tribunal is satisfied, based on the available evidence, that both Mr Dutton’s private companies and his mother’s private companies represent a meaningful or significant additional financial resource for child support purposes for Mr Dutton prior to 1 July 2020. However, by 8 July 2020, [Business 1], [Business 2] and [Business 3] were deregistered. The physical assets of the company in 2019/2020, while on the balance sheet were significant, Mr Dutton stated that these were manufacturing materials only and has provided evidence that they were disposed of for far less than the amounts indicated in the balance sheet. The Tribunal concludes that these, based on the evidence before it, cannot be reasonably viewed as property or financial resources that can be taken into account for child support purposes. In addition, given Mr Dutton’s financial circumstances and that he has not made repayments to his mortgages and credit cards for some time and now faces legal action by his creditors in relation to these outstanding liabilities, there is nothing before the Tribunal which indicates he has benefitted personally or transferred wealth or financial resources for his personal benefit. In the absence of evidence which substantiates such an allegation, it is not open to the Tribunal to reach such a conclusion.

Earning capacity

49.As to earning capacity, much of Mr Dutton’s evidence and arguments to the Tribunal were directed at demonstrating medical barriers to work.

50.A determination based on earning capacity may only be made if the relevant requirements of the legislation are satisfied. In that regard, subsection 117(7B) of the Act provides that I may determine that Mr Dutton’s earning capacity is greater than is reflected in his income only if satisfied that:

(a) one or more of the following applies:

(i) the parent does not work despite ample opportunity to do so;

(ii) the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full‑time work for the occupation or industry in which the parent is employed or otherwise engaged;

(iii) the parent has changed his or her occupation, industry or working pattern; and

(b) the parent’s decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:

(i) the parent’s caring responsibilities; or

(ii) the parent’s state of health; and

(c) the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.

51.In Mr Dutton’s circumstances, the change to his occupation, industry and working pattern, the reduction in the number of hours he has worked and the factors impacting on his opportunity to work are all comprehensively explained by the failure of his private companies in 2020 and his medical issues at the time. The Tribunal also accepts that his current part-time work is also explained by his ongoing health issues as outlined in the medical information provided.  In these circumstances, the Tribunal is satisfied that it was not a major purpose in any decision made by Mr Dutton to change his working arrangements to affect the administrative assessment of child support. As such, no determination the Tribunal makes may be based on the proposition that Mr Dutton’s earning capacity is greater than is reflected in his income.

Ms Dietz’s income, property, financial resources and earning capacity

52.Ms Dietz’s income is from Centrelink payments. She also relies on family assistance payments. She has disclosed no interest in a property, business or trust. The Tribunal is satisfied that reliance on adjusted taxable income is an accurate and appropriate measure of Ms Dietz’s financial capacity to support the child. No issue arises on the evidence in relation to Ms Dietz’s earning capacity.

53.The Tribunal notes that Ms Dietz’s statement of financial circumstances reveals some available funds in the bank ($26,000 in total) but does not consider these amounts to be such as to affect the assessment of child support payable. Ms Dietz’s evidence has been that she has been utilising these funds to meet living expenses. The Tribunal notes Mr Dutton’s allegations regarding Ms Dietz selling items online. The Tribunal accepts Ms Dietz’s evidence that these were one-off items gifted to her which she did not need and that this is not an ongoing enterprise.

Commitments of the parents

54.As to the commitments of each parent who is a party to the proceeding that are necessary to enable the parent to support themselves, the Tribunal has relied upon the statement of financial circumstances lodged by and on behalf of each parent.

55.Ms Dietz’s estimated household expenditure for herself and the child is largely unremarkable, other than to note her expenses are consistent with her modest income and also that her overall household expenses exceed her income. No personal expenses that are out of the ordinary are identified. Ms Dietz does not carry any personal debt and told the Tribunal at the hearing that she has some additional funds saved which she uses to provide support.

56.Mr Dutton’s expenses for his own self-support are also contained in his statement of financial circumstances. While Mr Dutton discloses only very limited household expenditure, it is still in excess of his income. This expenditure, however, includes mortgage payments which have not been paid for some time. If this amount is excluded, the household expenditure is commensurate with his current income.

57.As to the child or other people that each parent has a duty to maintain, the Tribunal notes that Mr Dutton is afforded a multi-case allowance in respect of other children the subject of a child support assessment not involving Ms Dietz. The Tribunal also notes that in the assessment notices issued Mr Dutton is recorded as not having care of [Child 1]. There is nothing in the evidence before the Tribunal to indicate that the provision already made in the formula to take into account Mr Dutton’s duty to maintain other children is insufficient.

58.The Tribunal is required to consider any hardship that would be caused to the child or the carer entitled to child support by the making of or the refusal to make a particular departure determination. The Tribunal considers that maintaining the previous departure determination in place for periods within the scope of this decision when Mr Dutton no longer was earning income through his private companies and no longer had access to income through these private companies would result in substantial hardship. For the reasons elaborated upon above, the Tribunal considers that 8 July 2020 would therefore be an appropriate point to give effect to a different departure determination to the one put in place previously by the Registrar. In this regard, the Tribunal may do so in accordance with section 98J of the Act on the basis of Mr Dutton’s substantial change of circumstances.

59.The current financial circumstances of the parents indicate to the Tribunal that the balance of hardship however remains with Ms Dietz. She does not earn an income apart from income support payments. Her household expenses are similar to those of Mr Dutton’s but Mr Dutton is not making repayments towards his personal debts. The Tribunal is satisfied that Ms Dietz has provided an accurate account of her financial circumstances and accepts that she has difficulty making ends meet.

60.As to the particular departure determination the Tribunal considers would be just and equitable, having regard to all the factors provided for in section 117 of the Act, the Tribunal considers the following determinations will give effect to my findings and reasons:

·From 15 May 2019 to 8 July 2020, to vary Mr Dutton’s adjusted taxable income to $214,000 per annum;

·From 9 July 2020 to 30 June 2023, to vary Mr Dutton’s adjusted taxable income to $36,348 per annum.

61.The purpose of the first determination is to preserve within any departure determination made in this application the initial assessment by the Agency on 26 October 2019, which Mr Dutton did not dispute and accepted as correct.

62.The purpose of the second determination is to reflect the circumstances as discussed above relating to Mr Dutton’s change in circumstances, having regard to the financial resources at Mr Dutton’s disposal since the private companies he controlled were deregistered and he had income from Centrelink payments and then, subsequently, employment. The Tribunal is satisfied that while this continues to create some arrears and meeting this assessment will cause some hardship, any such hardship would not be greater than that caused to Ms Dietz if no departure determination were to be made in this matter. The Tribunal also notes that Mr Dutton has not paid child support on a regular basis, according to the information provided by the Agency. Having regard to all the factors in subsection 117(4) of the Act, the Tribunal is satisfied that the determinations outlined above are just and equitable.

Issue 3 – Is it otherwise proper to make a particular departure determination?

63.The third step is to consider whether it would be otherwise proper to make a particular departure determination in accordance with sub-subparagraph 98C(1)(b)(ii)(B) of the Act. Subsection 117(5) sets out the matters that must be considered when deciding whether it would be ‘otherwise proper’ to make a departure determination.

64.At the time of writing, Ms Dietz was in receipt of some family tax benefit throughout the relevant period. As such, the Tribunal’s decision will have some impact on the public purse, by reducing her reliance on these payments for part of the period. Therefore, the Tribunal considers that it is otherwise proper to make the particular proposed determination.

65.The Tribunal notes that it is open to either party to lodge further change of assessment applications should future circumstances of either party change significantly from the circumstances upon which this decision is based.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that the objection is allowed so as to determine:

·From 15 May 2019 to 8 July 2020, Mr Dutton’s adjusted taxable income is varied to $214,000 per annum;

·From 9 July 2020 to 30 June 2023, Mr Dutton’s adjusted taxable income is varied to $36,348 per annum.