Emmott and Emmott (Child support) - [2017] AATA 2862

Emmott and Emmott (Child support) [2017] AATA 2862 (14 November 2017)

DIVISION: Social Services & Child Support Division

REVIEW NUMBER: 2017/MC011486

APPLICANT: Ms Emmott

OTHER PARTIES: Child Support Registrar

Mr Emmott

TRIBUNAL: Member J Cuthbert

DECISION DATE: 14 November 2017

DECISION:

The tribunal sets aside the decision under review and substitutes a decision to depart from the child support assessment from 1 July 2016 until the child support assessment for [Child 1] ends by varying:

the child support percentages to 85% for Mr Emmott and 15% for Ms Emmott; and
the costs of the children to the highest amount payable in the relevant Cost of the Children Table for two children of [Child 1] and [Child 2]’ ages.

Member J Cuthbert

CATCHWORDS
Child support – Departure determination - Income and financial resources of parents – Business income – Costs of children – Period of departure - 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 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 DECISION

HISTORY

This review concerns an application for a change to a child support assessment made by Ms Emmott on 15 November 2016.
Ms Emmott and Mr Emmott are the parents of [Child 1] (born 2001) and [Child 2] (born 2004). There has been a child support assessment in place, made by the Department of Human Services – Child Support (the Department), since 12 April 2013. The child support assessment is currently based on Ms Emmott having care percentages of 100% for both children.
Following a departure decision made by an officer of the Department on 24 February 2015, Mr Emmott was assessed to pay child support of $12,000 a year from 20 November 2014 to 31 March 2015.
From 1 April to 28 July 2015 Mr Emmott was assessed to pay the minimum annual rate of child support of $408 as he had estimated his 2014/15 income to be nil.
From 29 July 2015 the annual rate of child support payable increased to $23,044 as Mr Emmott was assessed on a provisional income for 2013/14 of $145,822 and Ms Emmott on her 2013/14 adjusted taxable income of $98,598.
However, on 3 August 2015 Mr Emmott estimated his 2015/16 income to be $35,975 and his child support liability reduced to $3,134 a year. The annual rate was further reduced to $2,836 from 1 May 2016 as Ms Emmott’s 2014/15 adjusted taxable income of $155,930 was used in the assessment.
From 1 July 2016 Mr Emmott was assessed to pay child support of $3,286 a year based on a provisional income of $38,000 and Ms Emmott’s 2014/15 adjusted taxable income. The annual rate increased to $3,652 from 1 November 2016 based on a provisional income of $38,407 for Mr Emmott and Ms Emmott’s 2015/16 adjusted taxable income of $112,153.
On 15 November 2016 Ms Emmott applied to the Department for a departure from the assessment on the grounds that Mr Emmott’s income, property, financial resources and earning capacity were not properly reflected in the assessment.
On 2 February 2017 a decision was made to depart from the child support assessment by:

varying Mr Emmott’ adjusted taxable income to $469,939 from 15 November 2016 to 14 November 2018; and
varying Ms Emmott’s adjusted taxable income to $137,719 from 15 November 2016 to 30 November 2017.

Both Mr Emmott and Ms Emmott lodged objections to that decision. On 31 March 2017 their objections were disallowed. On 13 April 2017 Ms Emmott lodged an application for a review of the objection decision with the tribunal.
Mr Emmott made an application to the Melbourne Magistrates’ Court on 29 May 2017 in which he sought orders which would affect his child support assessment, including an order under section 112 of the Child Support (Assessment) Act 1989 (the Assessment Act) and what appear to be applications for a departure order and an order that he has a duty to maintain his step-children under section 66L of the Family Law Act 1975. Those proceedings were transferred to the Federal Circuit Court where Ms Emmott sought to have the application dismissed. On 30 October 2017 the court set out a schedule for the parties to provide written submissions as to why the proceedings should not be dismissed. The matter is next listed before the court on 15 December 2017.
The tribunal notes that in a letter to Mr Emmott’s solicitors on 17 August 2017, solicitors acting for the Department noted various issues with the orders sought and made reference to the current proceedings before this tribunal. The tribunal is satisfied that a copy of that letter is included in the court papers that were transferred to the Federal Circuit Court. While Mr Emmott and Ms Emmott disagree as to whether the judge discussed the tribunal proceedings on 30 October 2017, the tribunal is satisfied that the court has been made aware of the current matter.
The matter was heard on 1 November 2017. Ms Emmott and Mr Emmott both attended the hearing by telephone. The Child Support Registrar was not represented at the hearing. While Mr Emmott suggested that the tribunal’s hearing of this matter should not proceed, the tribunal finds that it has jurisdiction to deal with Ms Emmott’s application for a review of the objection decision of 31 March 2017. The tribunal notes that the parties will be able to provide a copy of this decision and reasons to the court.
The tribunal had access to the statement and documents provided by the Department (folios 1 to 693 and 694 to 746), documents provided by Ms Emmott (folios A1 to A360) and documents provided by Mr Emmott (B1 to 20).
Shortly before the close of business on 31 October 2017 Mr Emmott sent various documents and submissions to the tribunal. Where relevant, those documents and submissions were discussed at the hearing. Following the hearing the documents were numbered B21 to B50. Ms Emmott was provided with copies and with an opportunity to comment.
On 10 November 2017 Ms Emmott provided the tribunal with written comments. She also provided further evidence in support of submissions she had made, some of which was already before the tribunal. The tribunal considers that the further evidence provided by Ms Emmott, such as Facebook entries, would not affect its deliberations. For that reason the tribunal decided not to take it into account.

CONSIDERATION

The rate of child support payable by a liable parent is usually based on an administrative assessment under Part 5 of the Assessment Act. This requires the application of a statutory formula which takes into account factors such as the number of children, the level of care provided and the income of each parent.
A liable parent or a carer may apply to the Child Support Registrar for a determination to depart from the child support assessment under Part 6A of the Assessment Act (section 98B). 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:
(i) that one, or more than one, of the grounds for departure referred to in subsection 117(2) exists; and
(ii) that it would be:
(A)just and equitable as regards the child, the liable parent, and the carer entitled to child support; and
(B)otherwise proper;
to make a particular determination under this Part; …
The grounds for departure from an administrative assessment of child support are set out in subsection 117(2) of the Assessment Act. If satisfied that a ground exists and that it would be just and equitable and otherwise proper to make a particular determination, the tribunal may make one of the determinations in section 98S of the Assessment Act. That section permits a range of determinations, including varying the annual rate of child support payable or a parent’s adjusted taxable income.

Issue One – Does a ground exist to depart from the administrative assessment?

Ms Emmott sought a departure from the administrative assessment on the grounds that Mr Emmott’s income, financial resources, property and earning capacity were greater than reflected in the provisional income for 2014/15 used for him in the assessment.
The grounds for departure are set out in subsection 117(2) of the Assessment Act. Subparagraphs 117(2)(c)(ia) and (ib) provides as grounds for departure:
(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; or
(ib)because of the earning capacity of either parent
…
The term “special circumstances” is not defined in the Assessment 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.

Mr Emmott’s income, property and financial resources

Mr Emmott is an [occupation]. He states that he is [job title] of [Company 1] on a part-time basis. He is also studying part-time at [university].
His income tax returns for 2013/14 and 2014/15 were not assessed by the Australian Taxation Office until 29 and 30 August 2017 respectively. His adjusted taxable incomes for those years are $141,522 and $72,982 respectively. Mr Emmott provided a copy of his income tax return for 2015/16 to the tribunal. However, it appears that an assessment has not yet been issued. The return shows a taxable income for 2015/16 of $64,481, made up solely of “allowances/earnings/tips/director’s fees, etc”. Mr Emmott did not provide the tribunal with a copy of his 2016/17 income tax return as directed. He stated that the return had not yet been prepared.
The tribunal notes that in September 2017 the assessment for the period 1 July to 31 October 2016 was amended using Mr Evan’s 2014/15 adjusted taxable income, but that the estimate he lodged for that year is yet to be reconciled.
Mr Emmott told the tribunal that his only income was from [Company 1]. He acknowledged that credits to his bank account from [Company 1] were not always for regular amounts. He said that the amount fluctuates in accordance with what the company can afford. He noted that in a six month period for which he provided bank statements there were credits of $28,850. Mr Emmott said that the amount stated in his income tax return includes rent of $700 a month that he is paid by [Company 1] for the use of a room in his home as an office. The tribunal notes that any rental income would usually be shown separately on an income tax return.
Mr Emmott refused to provide copies of financial statements and bank statements for [Company 1] as directed, or financial statements for [Company 2] Pty Ltd, the [Company 2] Investment Trust and the [Company 2] Superannuation Fund. He told the tribunal that he has no interest in [Company 1] and does not have any shareholdings apart from shares of small value in a mining company. He claimed not to be able to recall the name of the company. Mr Emmott stated that the [Company 2] Investment Trust has no assets, but later acknowledged that the trust hold all of the shares in [Company 1]. He said that [Company 2] Pty Ltd is the corporate trustee of the trust. At the directions hearing Mr Emmott told the tribunal that he holds the shares in [Company 2] Pty Ltd. At the hearing he refused to say whether he was a beneficiary of the trust or whether he held shares in [Company 2] Pty Ltd. He did not provide the tribunal with a copy of the trust deed as directed. Mr Emmott stated that he did not have to do so as the ownership of the trust was part of the property settlement between the parties.
Although Mr Emmott is adamant that he has no other income than that deposited by [Company 1] into his bank account, [number], during the hearing it became apparent that he had failed to provide copies of statements concerning his home loan and credit card as directed as well as the bank statements for the entities noted in the paragraph above.
The tribunal notes that the bank statements provided by Mr Emmott indicate home loan payments of about $3,600 a month as well as a level of discretionary spending on cafes and restaurants, hairdressing, etc. However, the statements do not show household expenses that might be expected for rates, utilities, groceries and other household costs. Mr Emmott stated that his partner, [Ms A] pays the majority of the bills and grocery expenses, but in the absence of copies of all of his bank statements and those for associated entities, his evidence in that regard cannot be tested. The tribunal notes bank statements obtained by the Department for [Company 1] show payments of rates to Mr Emmott’s local council in 2016.
An application made by Mr Emmott to set aside a departure prohibition order made by the Child Support Registrar on 24 May 2017 was dismissed on 6 July 2017. In an affidavit filed in those proceedings Mr Emmott stated that he and his partner had paid for a holiday [overseas] and had spent thousands of dollars in airfares and accommodation. On 16 July 2017 Mr Emmott paid $16,635.91 to the Department to discharge the arrears. Ms Emmott suggested that this was one of many overseas trips made by Mr Emmott. Mr Emmott was directed to provide copies of all passport entries for a specified period. However, he told the tribunal that he had no intention of doing so as Ms Emmott had not been directed provide copies of her passport entries.
Mr Emmott told the tribunal that he had borrowed funds from his father in order to make the payment in July 2017. He said that he was obliged to repay his father but had not yet done so. He refused to answer any further questions about the loan.
While Mr Emmott insists that his income is nowhere near that found by the Department, the tribunal notes that bank statements indicate deposits totalling of $91,715 made to an account held by [Company 1] in the period 15 September to 24 November 2016. Deposits made to [Company 1]’s account [number] from 20 December 2016 to 20 March 2017 total $73,600.91. The deposits suggest income of more than $400,000 a year. The tribunal notes that debits from the account include some payments to [Ms A]. The credits to the account were all from two sources, [Company 3] and [Company 4], both businesses involved in [details deleted]. The tribunal notes that the transfers from [Company 3] to January 2017 are titled “wages”.
Mr Emmott did not dispute the level of income received by [Company 1]. However, he stated that the company had “substantial costs” relating to wages and superannuation for staff and as well as stationery and other items. He refused to provide the tribunal with any details of the number or identity of staff members. The tribunal notes that available bank statements for [Company 1] do not indicate regular payment of wages. The tribunal infers that Mr Emmott is the sole employee of [Company 1] and that the income of [Company 1] relates to Mr Emmott’s personal exertion.
The tribunal notes that bank statements for Mr Emmott’s account [number] obtained by the Department for a period 20 December 2016 to 20 March 2017 show transfers from Facebook Ads titled “[Company 1]”. Mr Emmott did not provide statements for this account to the tribunal as directed.
Mr Emmott has equity in a house in which he lives with [Ms A] and her children. At 31 December 2016 he owed $866,380 on his home loan. Earlier bank statements obtained by the Department indicate that at 17 March 2017 Mr Emmott also had a personal loan [number] with about $25,529 outstanding and monthly payments of about $350. In a form submitted to court in May 2017 Mr Emmott stated that he owns a car and household contents as well as a small amount of superannuation. In the absence of the documents Mr Emmott was directed to provide, the tribunal has no other information about assets held by him either personally or beneficially.
The tribunal was hampered by Mr Emmott’s refusal to provide documents that would assist to determine his financial position. He insisted that various documents concerning entities associated with him were not relevant to the proceedings as he became the owner of various entities as a consequence of a property settlement in 2014. He failed to provide various other documents to the tribunal as directed on 20 July 2017, including statements from financial institutions, financial statements of associated entities and copies of passport entries. He insisted that he would only provide some of the documents to the court.
In Humphries & Berry (SSAT Appeal) [2008] FMCAfam 209 Federal Magistrate Slack dealt with the issue of the disclosure of financial information in child support matters before the former Social Security Appeals Tribunal. His Honour stated that the principle of full and frank disclosure applicable to proceedings in the Family Court was also applicable to proceedings before the tribunal. He stated at paragraph 31:
In financial proceedings under the Family Law Act, the authorities make it clear that a Court should not be unduly cautious about making findings in favour of the other party if it is not satisfied that proper disclosure has been made (see Chang & Su (2002) FLC93-117).
Also, in Agrippa & Horton (SSAT Appeal) [2010] FMCAfam 1144 Federal Magistrate Halligan stated:
If the SSAT is satisfied that a parent has made a deliberate non-disclosure of his or her financial circumstances, it should be reasonably robust in assessing the non-disclosing parent’s financial circumstances adversely to that parent and in favour of the other parent. That is not to say that it may arrive at an entirely arbitrary result, but rather that it may draw generous inferences adverse to the non-disclosing party about that parties financial circumstances.
The tribunal is satisfied that Mr Emmott deliberately failed to disclose certain material as directed. On the evidence available the tribunal finds that Mr Emmott has income and financial resources available to him of more than $400,000 a year, far greater than suggested by his adjusted taxable incomes.

Mr Emmott’ earning capacity

The tribunal also considered Mr Emmott’s earning capacity and the three criteria in subsection 117(7B) of the Assessment Act. The tribunal notes that a change to his working pattern from late 2014 was the subject of a departure decision made by the Department on 24 February 2015. Ms Emmott did not lodge an objection to that decision.
The tribunal finds that Mr Emmott’s current income and financial resources are far greater than his estimated income at that time. Although Mr Emmott asserts that his capacity to earn income is limited by a condition which causes him stress and anxiety there is no evidence that his income has reduced. He stated that he was receiving treatment but refused to discuss the treatment or his condition at the hearing.
On the evidence available and in light of the findings about Mr Emmott’s income and financial resources, the tribunal finds that the three criteria of subsection 117(7B) of the Assessment Act are not satisfied. As a consequence the tribunal is unable to determine whether Mr Emmott has any unused earning capacity.

Do the existing assessments provide a result which is unjust and inequitable?

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

In order to determine whether Mr Emmott’s income and financial resources result in child support assessments which are an unjust and inequitable determination of the financial support he should provide for [Child 1] and [Child 2], the tribunal considered whether Ms Emmott’s adjusted taxable income is indicative of her income, property, financial resources and earning capacity.

Ms Emmott has been employed by [a company] as a [occupation] for more than six years. She works on a full-time basis. Her 2015/16 adjusted taxable income is $112,153. In 2016/17 her adjusted taxable income is $110,275 made up of salary of $94,828 allowances of $21,999, interest of $3,070 and reportable superannuation payments of $13,371; less motor vehicle expenses of $11,494, other work related expenses of $10,896, gifts of $75 and $528 for the cost of managing her tax affairs.
Ms Emmott stated that her motor vehicle log book showed 90% business use of her vehicle. She said that she works from home and travels about 30,000 kilometres a year for work throughout regional [State 1]. Ms Emmott stated that she claims home office expenses for office furniture and computer hardware as well as a certain percentage of the rent she pays and utility bills. She said that she uses one room of a three bedroom home. While accepting that Ms Emmott expends funds in order to earn income, the tribunal notes that the ability to claim motor vehicle and other expenses may provide Ms Emmott with some additional financial resources which are not indicated by her adjusted taxable incomes.
The payslips provided by Ms Emmott indicate year to date gross earnings of $24,780 to 30 September 2017, indicating an annual income of about $99,000. However, Ms Emmott acknowledged that she receives commissions if she meets sales targets. She told the tribunal that she has not received any commissions since March 2017 (the start of her employer’s financial year) and was last paid $10,750. She said that she had received commissions in three of the last seven years, the largest in 2014/15.
The tribunal notes that Ms Emmott has some savings remaining from the property settlement between the parties. She owns a motor vehicle and household goods and has funds invested in superannuation. There is no evidence that Ms Emmott has any other financial resources or property of significant value which is capable of providing her with any significant income.
Mr Emmott stated that Ms Emmott has potential to earn more income from her work. The tribunal considered Ms Emmott’s earning capacity noting that she has worked on a full-time basis since 2010 and that she has not altered her work arrangements for at least six years. Ms Emmott told the tribunal that while she recently took some time off work due to a medical condition she utilised paid leave. The tribunal finds that the three criteria in subsection 117(7B) of the Assessment Act are not satisfied. As a consequence the tribunal is unable to determine that Ms Emmott has any unused earning capacity.

Are there special circumstances for which to depart from the assessment?

Taking into account the objects of the Assessment Act (section 4), including that children should share in the standard of living of both their parents, the tribunal finds that, even if Ms Emmott’s income and financial resources are greater than indicated by her adjusted taxable income, the income and financial resources of Mr Emmott provide special circumstances for which to depart from the assessment. Mr Emmott would be liable to pay far more child support if the assessment was based on his income and financial resources rather than his adjusted taxable income. The tribunal finds that the assessment is unfair to Ms Emmott and to the children for that reason and that a ground is established to depart from the assessment under subparagraph 117(2)(c)(ia) of the Assessment Act.

Issue Two – Would a departure from the administrative assessment be just and equitable?

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 just and equitable to depart from the assessment having regard to the matters set out in subsection 117(4) of the Assessment Act.
Section 3 of the Assessment Act states that it is the duty of both parents to financially support their children. In accordance with the objects set out in section 4 of the Assessment Act, [Child 1] and [Child 2] should receive a proper amount of financial support from their parents in accordance with their capacity to contribute.

The children’s needs

[Child 1] is 16 years old and [Child 2] is 12. They both attend public schools. Ms Emmott suggested that she has costs for the children’s education that are out of the ordinary or unusual as [Child 1] went on an educational trip to [Overseas] in October 2016 that cost her about $5,000 and [Child 2] started high school in 2017 and needed an iPad, amongst other things. The tribunal finds that the costs of [Child 2] starting high school are not out of the ordinary, they are the kind of expenses that parents of other children attending public schools would meet.
Mr Emmott told the tribunal that he had agreed to provide some financial support for [Child 1]’s trip on condition that he was provided with details of the trip. However, he said that he did not provide any funds as no details were provided to him. The tribunal notes that Ms Emmott sought court orders concerning [Child 1]’s passport but did not seek a contribution to the trip at that time. The tribunal is satisfied that both Mr Emmott and Ms Emmott intended that [Child 1] would go on the overseas trip. However, while it seems that the costs associated with the trip would significantly affect the overall cost of [Child 1]’s support, Ms Emmott did not provide evidence of the actual cost or seek to pursue the issue.
Ms Emmott told the tribunal that [Child 1] has also had extensive dental work. She said that [Child 1] had [details of dental procedures]. Ms Emmott said that although she has private health insurance the out of pocket costs are high. She provided no evidence about the specific costs and the need for the treatment. She did not seek an increase to the assessment on that basis.
Mr Emmott contends that funds he expended for the benefit of the children in 2013 ($35,000 for private school fees at their former school and furniture, etc,) should be taken into account in the assessment. The tribunal notes that the payments were made prior to the settlement of property matters between the parties in June 2014. In addition, Mr Emmott raised the issue in a departure application he made in August 2013 and did not lodge an objection to the decision of 25 October 2013 to refuse his application. For those reasons, the tribunal finds that it would not be just and equitable to depart from the child support assessment.
Other than the expenses for [Child 1]’s trip and dental treatment, the tribunal is satisfied that the costs related to the care of [Child 1] and [Child 2] are not out of the ordinary range of expenses for children of their ages.

The children’s income, property, financial resources and earning capacity

The tribunal has no evidence that either [Child 1] or [Child 2] has any income, property or financial resources or any unused earning capacity that needs to be taken into account in the child support assessment.

The income, property, financial resources and earning capacity of Ms Emmott

The income, property, financial resources and earning capacity of Ms Emmott have been discussed above.

Ms Emmott’s necessary commitments

Ms Emmott lives with the children in rented accommodation. Mr Emmott suggests that she has a partner who assists to meet household costs. The tribunal notes that even if Ms Emmott has a partner, that person has no duty to support [Child 1] and [Child 2]. After reviewing the bank statements Ms Emmott provided the tribunal is satisfied that she is able to meet the reasonable and necessary expenses that she has for herself and the children. While her stated expenses (including a level of discretionary spending) exceed her income, the tribunal notes that she has been utilising her savings from the property settlement to meet those costs.

The income, property, financial resources and earning capacity of Mr Emmott

The income, property, financial resources and earning capacity of Mr Emmott have been discussed above.

Mr Emmott’s necessary commitments

Mr Emmott lives with [Ms A] and her children in a house he owns. There is no evidence to suggest that he is unable to meet his reasonable and necessary expenses.

The parents’ duty to support others

The tribunal finds that Ms Emmott does not have a duty to support any other person apart from [Child 1] and [Child 2].
Mr Emmott states that he supports [Ms A’s] children: [Child 3] (born 2005) and [Child 4] (born 2009). The tribunal notes that there is no evidence that he has a legal duty to do so (such as an order under section 66L of the Family Law Act 1975).
In an affidavit sworn on 28 September 2017 [Ms A] stated that while she earns between $45,000 and $75,000 a year in [a certain] industry and is able to support herself, she relies on Mr Emmott to provide assistance of about $200 a week in order to be able to support [Child 3] and [Child 4]. A child support assessment for the period 1 July to 30 November 2017 states that the children’s father has a nil child support liability.
The tribunal notes that [Ms A] has annual income well in excess of the self-support amount used in the child support assessment formula. Mr Emmott gave evidence to a court that she had contributed to the cost of an overseas holiday in 2017. In his evidence to the tribunal Mr Emmott stated that he pays the mortgage and [Ms A] pays most of the remaining household bills including amounts payable for utilities and groceries. He said that he was unable to say whether she received family tax benefit for the children.
The tribunal has no evidence to support [Ms A’s] assertion that neither she, nor the children’s father is unable to support [Child 3] and [Child 4], due to ill-health or caring responsibilities. The tribunal finds that neither [Child 3] nor [Child 4] is a “resident child” for that reason (subsection 117(10) of the Assessment Act). Any support Mr Emmott provides to [Child 3] and [Child 4] cannot take priority over his duty to support [Child 1] and [Child 2].

Terms and period of departure

Ms Emmott made her departure application on 15 November 2016. She seeks a departure from the assessment for the maximum 18 month period permitted under subsection 98S(3B) of the Assessment Act). She acknowledged that her application raised issues that she initially raised in departure applications in November 2014 and August 2015. However, Ms Emmott stated she had not made another application or lodged objections against the decisions made on 24 February and 22 September 2015 as she was representing herself in stressful court proceedings at those times. She said that the court proceedings were finalised in October 2016 after which she made her application.
In his submissions Mr Emmott noted court hearings between the parties concerning parenting matters in mid-2015 and late October 2015. The tribunal noted that there were further proceedings between the parties including orders sought by Ms Emmott in relation to [Child 1]’s passport that were finalised in October 2016. Mr Emmott denied Ms Emmott’ assertion that she was unable to lodge an objection to the departure decision due to concerns about domestic violence. However, the tribunal notes that in his current application to court Mr Emmott is seeking an order under section 112 of the Assessment Act so that a departure order can be made from 1 July 2015 to take into account a duty to support [Child 3] and [Child 4].
The tribunal further notes that while Mr Emmott’s 2014/15 adjusted taxable income has now been used in the assessment from 1 July to 31 October 2016, the estimate he made for the period from 1 April to 28 July 2015 has not yet been reconciled. His 2015/16 estimate which applies from 3 August 2015 to 30 June 2016 will not be reconciled until his adjusted taxable income is determined by the Australian Taxation Office.
Taking into consideration that Ms Emmott may have some limited additional financial resources other than those suggested by her adjusted taxable incomes, the tribunal finds that after deductions of the self-support amount, Mr Emmott has child support income more than four times greater than Ms Emmott. The tribunal finds that it would be just and equitable to depart from the assessment by varying both parents’ child support percentages, so that Mr Emmott has a child support percentage of 85% and Ms Emmott has a child support percentage of 15%. The tribunal finds it likely that both parents will continue to have combined incomes that exceed the figure of 2.5 times the annualised Male Total Average Weekly Earnings (MTAWE). For that reason it would be just and equitable for the costs of the children to be varied to the highest amount in the Cost of the Children Table for two children of their ages.
In the circumstances of this case the tribunal finds that it would be just and equitable for the variations to the assessment to take effect from 1 July 2016. Although Mr Evan’s adjusted taxable incomes do not adequately reflect his income and financial resources from at least 1 April 2015, the assessments from that date will increase as the estimates lodged by Mr Emmott should be reconciled. Although the tribunal notes that there were various proceedings between the parties in 2015 and 2016, the tribunal is not satisfied that Ms Emmott was prevented from making an earlier application or seeking review of earlier decisions.
Ms Emmott stated that she considered that a departure from the assessment should be made for as long a period as possible in light of the history of the case. Mr Emmott insisted that he would be seeking orders for reasons that would be outlined in court. Taking into account the history of the matter and to provide some certainty, the tribunal proposes to extend the variation to the parents’ child support percentages and the cost of the children until the assessment for [Child 1] ends.
The tribunal finds that the proposed variations result in a child support liability (currently about $600 a week) which reflects a reasonable level of support for [Child 1] and [Child 2] given the differences between their parents’ incomes and financial resources and property.

Hardship

The child support payable on the basis of the decision proposed should assist Ms Emmott to meet the children’s proper needs.
On 17 October 2017 Mr Emmott owed child support arrears of close to $10,000. The proposed decision will result in an increase to the arrears. However, in light of the findings about his income and financial resources the tribunal considers that the proposed decision will not result in hardship to him.

Issue Three – Is it otherwise proper to depart from the administrative assessment?

The final step for the tribunal to undertake is to determine whether it is “otherwise proper” to depart from the administrative assessment. Subsection 117(5) of the Assessment Act requires the tribunal to take into consideration the following matters:
(a) the nature of the duty of a parent to maintain a child (as stated in section 3) and, in particular, the fact that it is the parents of a child themselves who have the primary duty to maintain the child; and
(b) the effect that the making of the order would have on:
(i)any entitlement of the child, or the carer entitled to child support, to an income tested pension, allowance or benefit; or
(ii)the rate of any income tested pension, allowance or benefit payable to the child or the carer entitled to child support.
The child support law recognises that each parent has a primary duty to maintain their children. Ms Emmott is no longer eligible to receive family tax benefit. However, the tribunal is satisfied that it is otherwise proper to depart from the administrative assessment in this matter and to properly reflect both parents’ income and financial resources.

DECISION

the child support percentages to 85% for Mr Emmott and 15% for Ms Emmott; and
the costs of the children to the highest amount payable in the relevant Cost of the Children Table for two children of [Child 1] and [Child 2]’s ages.