Edwards and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Anor

[2008] AATA 800

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 800

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/4477

GENERAL ADMINISTRATIVE DIVISION		)
Re		GLYN EDWARDS

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

And TERESE SULLIVAN

Third Party

DECISION

Tribunal Dr K S Levy RFD, Senior Member

Date9 September 2008

PlaceBrisbane

Decision

(1)      Dr Edwards had access to the children for less than 10% of the time during each of the 2003/04, 2004/05 and 2005/06 financial years.

(2)      The decision under review is affirmed.

(3)      That Dr Edwards has therefore been overpaid and has a debt due to the Commonwealth (s 71 of the Family Assistance Administration Act).

(4)      The stay ordered on 1 November 2007 preventing recovery of the family tax benefit debt payable by Dr Edwards is hereby lifted.

...............[Sgd]............................

Senior Member

CATCHWORDS

SOCIAL SECURITY – Pensions, Benefits & Entitlements – family tax benefit – level of care percentage – children in care less than 10% – decision under review affirmed.  

PRACTICE AND PROCEDURE – Evidence – general discretion to exclude evidence – general discretion to limit use of evidence.

A New Tax System (Family Assistance) Act 1999 (Cth) ss 25(1), 59

Evidence Act 1995 (Cth) ss 135, 136

Re Secretary, Department of Family and Community Services and Barrett (1999) AATA 196; (1999) AAR 131

Vidler v Secretary, Department of Social Security (1995) 61 FCR 370

Wade v Secretary, Department of Family and Community Services [2004] FCA 1660

Re Warne and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2006] AATA 159

REASONS FOR DECISION

9 September 2008	Dr K S Levy RFD, Senior Member
BACKGROUND

1.      The Applicant, Dr Glyn Edwards, seeks review of a decision of the Social Security Appeals Tribunal (SSAT) which held that he did not have actual care of his children for more than 10% of the time in the 2003/04, 2004/05 and 2005/06 financial years.

2.      As Dr Edwards had been paid family tax benefit amounts for each of those three years, this means that, if the decision of the SSAT is upheld, then Dr Edwards has a debt to the Commonwealth which he is liable to repay.  He had been paid amounts which pertained to actual care for between 11% and 13% of the time for each of his three children in respect of each of those three financial years.

3.      This matter has a rather lengthy background.  Dr Edwards was previously married to the Third Party, Terese Sullivan.  There were six children of that marriage and in the financial years concerned, three of those children were each within the definition of a family tax child. Both the parents provided proportional care and family tax benefit was payable.  Dr Edwards and Ms Sullivan separated in 1998 and subsequently divorced.  Dr Edwards has since remarried.  Ms Sullivan is in another relationship and now has another young child.

4.      The history of the potential debts against Dr Edwards and/or Ms Sullivan arose when, on 2 May 2006, Dr Edwards lodged claims for family tax benefit in respect of the three children, A1, L and A2 (these identifiers approximating the first letter of the children’s Christian names).  These claims were for the three prior financial years and on the basis of a Court order which granted him access to the children for half of the school holidays.  Centrelink as a result, determined that Dr Edwards had access to his three daughters abovementioned for between 11% and 13% in each of the 2003/04 and 2004/05 financial years based on his accounts.  As a result, it was deemed that Ms Sullivan had been overpaid by corresponding amounts of family tax benefit and therefore had a debt to repay to the Commonwealth.

5.      Ms Sullivan appealed that decision to an authorised review officer (ARO) on 12 February 2007.  Her claim was again rejected.  She then appealed to the SSAT on 21 March 2007.  Her claim was successful, which meant that Dr Edwards had been overpaid and that he now has a debt due to the Commonwealth.  He has appealed that decision but it is noted that there is a stay on the recovery of the amount from Dr Edwards until the outcome of the decision in this matter.

6.      By way of further background, it is noted that since the Applicant lodged his application for review with this Tribunal on 12 September 2007, its progress has been protracted.  There have been orders to restrict certain documents to each of the parties.  In the early part of 2008, there were also a number of times where the matter had been listed for hearing but was vacated. These were generally based on submissions by the Applicant that he was unavailable or undergoing medical treatment.

7.      Since 23 May 2008, there have been further directions hearings and directions made by the Tribunal.  On 23 May 2008, as a result of a request by Dr Edwards to vacate a hearing date set for the 6^th of June 2008, a telephone directions hearing was scheduled.  At the time and date of that directions hearing, Dr Edwards did not attend by telephone but had his wife attend instead.  No prior notice was given although Mrs Edwards said that Dr Edwards was on his way to a medical appointment.  I then scheduled a further directions hearing for the 6^th of June 2008 and stated that the Applicant and Respondent should attend in person.  Late on the afternoon of 5 June 2008, a faxed medical certificate was forwarded to the Tribunal indicating that Dr Edwards was again not well enough to attend.  As this continued to affect and inconvenience the Third Party, as well as leaving the matter unresolved for the Respondent, I granted a further period for the parties to ensure that any further evidence required was presented to the Tribunal and that a hearing date was to be set following an opportunity to present any new evidence. 

8.      That hearing date was to be within one month of 18 July 2008.  I directed at that time that if the Applicant was then not well enough to appear on the date set for the hearing then he was at liberty to be represented by a legal representative, his wife or any other person of his choosing.

9.      Again, on the day before the matter was set for the present hearing, the Tribunal’s registry received a call first from Mrs Edwards enquiring as to whether the hearing would still be proceeding on the scheduled date.  Mrs Edwards was advised that it would proceed and she asked whether the Tribunal had heard from her husband.  She was advised that Dr Edwards had not made contact with the Tribunal.  Later that morning, Dr Edwards himself then contacted the registry and asked if the hearing could again be vacated as his wife had gone missing.  He said the matter had been reported to the police and that he was very distressed.  I declined to grant any further extension based on the report of both telephone calls and the history of the elongation of this matter.

10.     That forms part of the factual background.  In addition, the Tribunal has noted that following earlier attempts by Conference Registrars to settle this matter, there is clearly a degree of acrimony between Dr Edwards and his former wife, Ms Sullivan.

11.     Both the Applicant and the Third Party represented themselves and gave evidence by telephone.  The Respondent was represented in person by Mr Joe Guthrie.

ISSUE

12.     The issue to be decided by the Tribunal in this case is what was the level of care provided by Dr Glyn Edwards to his three children in the 2003/04, 2004/05 and 2005/06 financial years.

EVIDENCE

13.     There has been a substantial amount of documentary evidence available to the Tribunal.  The following documents were noted:

(1)Exhibit 1 – an edited version of the T documents admitted under s 37 of the Administrative Appeals Tribunal Act 1975.

(2)Exhibit 2 – a response to reasons for the decision of the SSAT by the Applicant.

(3)Exhibit 3 – an Outline of Submissions by Dr Glyn Edwards.

(4)Exhibit 4 – Ms Sullivan’s response to Dr Edwards Submissions.

14.     The Applicant and the Third Party both provided an affirmation prior to giving evidence.  Shortly after indicating that neither of the parties intended to call other witnesses, Ms Sullivan stated that she was accompanied by her daughter A1 who is now 19 years of age and was one of the children in respect of whom family tax benefit was paid in the three financial years concerned.  She indicated A1 would give evidence about the factual position which she submitted.  A1 Edwards was then asked to take an affirmation also.

15.     Dr Glyn Edwards gave brief oral evidence indicating that he mainly wished to rely upon the written evidence which he had already submitted.  He also however submitted that given the passage of time since the relevant financial years and the fact that Ms Sullivan had previously admitted that she had kept no contemporaneous records of the dates upon which the children were with either herself or Dr Edwards, he submitted that it was difficult for either of them to remember dates precisely and therefore he said he could not understand how a decision could be made against him.  After explaining the process for the remainder of the hearing, I undertook to give Dr Edwards a further week to put in other written submissions when the hearing was adjourned.  Ms Sullivan was given a week following receipt of Dr Edwards’ latest written submissions.

16.     Dr Edwards was cross-examined by Mr Guthrie.  He conceded that he was away for most of the school holidays in the 2005/06 financial year but maintained that for the other three school holidays, that he may have had the children for more or less than one week and in respect of the three shorter holiday periods, that would amount to 21 days.  In addition, he claimed to have them for a further 17 days over other school holidays or other periods for those financial years making 38 days in total (approximately). He submitted that this would therefore justify a claim of 13% of the family tax benefit amount in respect of the three children concerned.

17.     Ms Sullivan gave evidence that Dr Edwards had never had the children for any time more than one week for school holidays and at no time had he ever had them for a two week period.  She said putting it at its highest, he could possibly have had the children for a seven day period for the three shorter school holiday periods plus fourteen days over the Christmas period.  This would amount to 35 days, which would be less than 10% of the year.  This is the statutory threshold which the Applicant must meet before he would be entitled to the family tax benefit.

18.     Dr Edwards in rebuttal, said that Ms Sullivan had conceded to the SSAT in evidence there that she made no contemporary records of the dates which the children were with their father and that she had reconstructed the records following Dr Edwards’ claim.  He also maintained that Ms Sullivan had conceded in evidence at that Tribunal that she could not be exactly sure of the exact dates which the children spent with him.

19.     A1 Edwards then gave evidence.  She stated that she could not be 100% sure of the exact days spent with her father in the particular years either but said that the maximum she would have spent would have been two weeks over the Christmas period and half of the other holiday periods.  She also gave evidence that there may have been some periods which were different for her and her two sisters but she was quite sure that the periods largely coincided. In any event, she told the Tribunal that her sisters would not have spent any longer with her father than the maximum periods that she had indicated.

20.     The Tribunal also again heard Dr Edwards agree that there may have been some variability in the times he had the children but said there were other times when he made up for loss of time such as when he was overseas.  Ms Sullivan, on the other hand, did not agree with Dr Edwards and said that at times it was he who would choose not to have access to the children.

21.     A1 was cross-examined by Mr Guthrie.  A1 reiterated that she never spent more than two weeks with her father i.e. there were no more than 14 days that she had ever spent with him at Christmas periods.  In the other periods, she said there were no more than seven days.  She said only in her final year she may have been with her father on alternate days but again said that she never would have been with him for any period longer than the maximum which she had already indicated.

22. Submissions were made by both Mr Guthrie and Dr Edwards. Mr Guthrie referred the Tribunal to s 59 and s 25 of A New Tax System (Family Assistance) Act 1999 (“the Act”). He maintained that to reach the 10% threshold, Dr Edwards would need to have had care of the children for at least 37 days. He submitted that even if Dr Edwards had the children for 14 days at Christmas, then he could only have had access to them for 35 days at a maximum.

23.     Mr Guthrie also submitted that the issue should involve consideration of “actual care” of the children and referred the Tribunal to the matter of Re Secretary, Department of Family and Community Services and Barrett[1].  In that case, DP Forgie referred to O’Loughlin J’s consideration of the statutory requirements in Vidler v Secretary, Department of Social Security[2].

[1] (1999) AATA 196; (1999) AAR 131

[2] (1995) 61 FCR 370

24.     Dr Edwards submitted that the evidence was inconclusive and therefore the debts should not be recoverable against him.  He also asked for a further period for him to be able to present written submissions.  A week was granted.  A day before the expiry of that period, Mrs Edwards telephoned the tribunal for a further extension in order for she or Dr Edwards to obtain a transcript of the hearing.  She admitted that in the time since the hearing, neither she nor Dr Edwards had taken any steps to make an application to Auscript for that transcript.  Further latitude was again extended to Dr Edwards.

Further Submissions By The Applicant

25.     Further written submissions were filed by Dr Edwards dated 27 August 2008.  I have considered those submissions, some of which are not disputed by the Third Party or the Respondent. But he makes a strong submission that Ms Sullivan does not have any supporting documentation for her position and that her evidence should not be preferred to his.  He refers again to the “significant passage of time” for either he or Ms Sullivan to be certain of actual dates the children were with him or Ms Sullivan.

CONSIDERATION

26.     I have considered the evidence and the relevant legislative provisions and amplifying case law.  In assessing all of the material, I have made the following findings of fact:

(1)Dr Edwards and Ms Sullivan were previously married and are the parents of the three children A1, L and A2.  During the relevant years, each of the children was a family tax benefit child.

(2)There were Family Court orders as to arrangements for the children to be with Dr Edwards over school holidays.  As is sometimes the case, there is either provision for flexibility in such orders or the parties have agreed between each other on amicable terms to vary the dates for their mutual convenience without initiating any action as to breach of the order.

(3)Ms Sullivan was initially paid 100% of the family tax benefit for 2003/04, 2004/05 and 2005/06 financial years.

(4)Dr Edwards was subsequently granted family tax benefit for the three children respectively at a rate of between 11% and 13% in respect of each child.

the legislative requirements

27. The relevant provisions are contained in the Act. Section 25 (1) of that Act enables the Secretary to pay the full or a proportion of the family tax benefit amount in respect of each child where he or she is satisfied that the child concerned is a family tax benefit child and that the child will be with the person seeking payment, for at least 10% of the time. The Secretary has a discretion also as to determining the percentages to be payable where there is more than one person who is the carer of the child. The tribunal now exercises that statutory discretion.

28. The issue for determination in this case is what is the proportion of actual care by each of Dr Edwards and Ms Sullivan for the three children in the three relevant periods. The Act does not provide any greater level of detail to assist in determining that question. There is however a guide which outlines the approach to be taken where the parties are not in agreement and the Secretary needs to determine “a pattern of care”. That determination is intended to be a pragmatic assessment so that the allowance is received by the person having actual care of the child.[3]  Dr Edwards submitted however that as Ms Sullivan did not keep accurate records, the evidence is therefore inconclusive. 

[3] Wade v Secretary, Department of Family and Community Services [2004] FCA 1660.

29.     However, I note equally, Dr Edwards does not have records of precision either, even when he submitted his claim to operate retrospectively.  In any case, the question of the precision of records kept by either the Applicant or the Third Party is answered by the approach taken in Re Warne and Department of Families, Community Services and Indigenous Affairs[4].  There, DP Hack held that these are cases where the most appropriate method will usually be a “broad brush” approach. That is in the context of being able to be satisfied of “actual care” by a party as considered in Vidler and Barrett.

[4] Re Warne and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2006] AATA 159 at par 25

30. The determination of whether Dr Edwards’ evidence should be accepted comes down to the weight which I put on the evidence he has provided. The law in that regard is contained in ss 135 and 136 of the Evidence Act 1995 (Cth). Section 135 provides that evidence may not be admitted if there is a danger it will operate unfairly or prejudicially to another party or is misleading or confusing. Section 136 is a similar provision which grants a general discretion to limit the use of any evidence admitted where it is likely to operate unfairly against another party or is misleading or confusing. Those provisions leave the decision maker with the discretion to determine the weight of the evidence. I am prepared to accept that the evidence of all of the parties is admissible. It is also relevant. But the contradictory nature of some of the evidence requires that I exercise the discretion by determining the weight to be placed on the evidence of each of the parties.

31.     I agree with Dr Edwards that Ms Sullivan’s evidence is not supported by any documentary records.  But neither is the evidence of Dr Edwards. Dr Edwards gave the impression of trying to delay the proceedings and avoid a final decision.  I also found his evidence to be defensive in some aspects.  His references in evidence and in his final written submissions about Ms Sullivan’s superannuation which she obtained after she separated from him, together with his submissions about an inheritance which she obtained from a parent were irrelevant to these proceedings, which involve determination of a statutory entitlement based on the best evidence of what “actual care” was provided by each parent.  I therefore reject those submissions about other pecuniary holdings of Ms Sullivan.

32.       I note the SSAT regarded Dr Edwards’ evidence as being unreliable.  I regarded his evidence at face value as being equivocal, although some of the avoidant manner of his dealing with the Tribunal prior to the hearing was accentuated, firstly, by his attempt to have the proceedings further adjourned the day before the hearing when his wife apparently went missing (and of which no mention was made at the hearing by Dr Edwards) and, secondly, an attempt to gain a further extension to make further submissions when the evidence presented to me indicates neither he nor Mrs Edwards had made any attempt to apply for a transcript up until the day before the end of the approved period for those extra submissions. Those actions have made an adverse impact on Dr Edwards’ credibility. 

33.     In the final analysis, I regarded Ms Sullivan as less partial than Dr Edwards and therefore more reliable in the evidence which she provided. Of critical importance was my acceptance of the evidence of their daughter A1, who I regarded as a witness of truth.  She seemed factual and convincing in terms of the amount of time she would have spent with her father for the three years concerned.  As a result, I find that Dr Edwards’ evidence should be given considerably less weight than that of either his daughter A1 or his former wife, Ms Sullivan, whose versions of evidence I accept as findings of fact. 

34.     In the circumstances, I direct as follows:

(1)Dr Edwards had access to the children for less than 10% of the time during each of the 2003/04, 2004/05 and 2005/06 financial years.

(2)The decision under review is affirmed.

(3)Dr Edwards has therefore been overpaid and has a debt due to the Commonwealth (s 71 of the Family Assistance Administration Act).

(4)The stay ordered on 1 November 2007 preventing recovery of the family tax benefit debt payable by Dr Edwards is hereby lifted.

I certify that the 34 preceding paragraphs are a true copy of the reasons for the decision herein of Dr K S Levy RFD, Senior Member

Signed: .........................[Sgd]....................................................
              Elizabeth Young, Research Associate

Date/s of Hearing  14 August 2008
Date of Decision  9 September 2008
The Applicant was self-represented
The Third Party was self-represented      
Solicitor for the Respondent      Mr Joe Guthrie, Departmental Advocate