Essex and Essex (SSAT Appeal)
[2011] FMCAfam 274
•18 April 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| ESSEX & ESSEX (SSAT APPEAL) | [2011] FMCAfam 274 |
| CHILD SUPPORT – SSAT – Application for leave to appeal child support decision of the Social Securities Appeals Tribunal out of time – leave to appeal granted. |
| Child Support (Registration and Collection) Act 1988, s.110C Child Support (Assessment) Act 1989, s.117 |
| Gallov Dawson (1990) 64 ALJR 458 Clivery & Conway [2007] FamCA 1435 Bagley & Bagley (SSAT Appeal) [2010] FMCAfam 215 Trejo & Walker & Anor (SSAT Appeal) [2010] FMCAfam 1393 Rafter & Rafter [2011] FamCAFC 46 |
| Applicant: | MS ESSEX |
| Respondent: | MR ESSEX |
| File Number: | LNC 284 of 2007 |
| Judgment of: | Bender FM |
| Hearing date: | 25 March 2011 |
| Date of Last Submission: | 25 March 2011 |
| Delivered at: | Melbourne |
| Delivered on: | 18 April 2011 |
REPRESENTATION
| Counsel for the Applicant: | Ms Finch |
| Solicitors for the Applicant: | Hobart Community Legal Service |
| Counsel for the Respondent: | Self-represented |
| Solicitors for the Respondent: | Self-represented |
ORDERS
The applicant wife be given leave to appeal the decision of the Social Securities Appeals Tribunal dispatched 15 June 2010 out of time.
The matter be adjourned to 1 July 2011 at 10.00am before Federal Magistrate Bender in the Hobart Registry of the Federal Magistrates Court for hearing.
On or before 3 June 2011 the appellant file and serve any amended Notice of Appeal.
On or before 3 June 2011 the appellant file and serve an Outline of Argument Document including the following:
(a)a brief chronology listing significant events;
(b)references to the relevant passages in the material relied upon;
(c)a list of authorities relied upon;
(d)main contentions; and
(e)the actual orders sought.
On or before 17 June 2011 the respondent file and serve an Outline of Argument Document including the following:
(a)a brief chronology listing significant events;
(b)references to the relevant passages in the material relied upon;
(c)a list of authorities relied upon;
(d)main contentions; and
(e)the actual orders sought.
The party responsible for the payment of any fee including a setting down or hearing fee do pay or cause to be paid such of the fees as shall be payable by that party in accordance with, and within the time specified in, the Federal Magistrates Court Regulations 2000.
AND THE COURT NOTES THAT:
A.In the event of non compliance by any party with the orders, directions, Rules or Regulations of this Court relating to:
(a)the filing of documents; or
(b)any other procedural issues,
the application may be struck out, the proceedings may be directed to proceed undefended or the trial date may be vacated and the Court may direct that a further date not be fixed until all parties have complied with the said orders, directions, Rules and Regulations.
B.To the extent that it is or may be practicable to do so, a compliance check is to be carried out by an Associate or Deputy Associate of the trial Federal Magistrate, or by another appropriate court officer, shortly prior to the final hearing date.
IT IS NOTED that publication of this judgment under the pseudonym Essex & Essex (SSAT Appeal) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT HOBART |
LNC 284 of 2007
| MS ESSEX |
Applicant
And
| MR ESSEX |
Respondent
REASONS FOR JUDGMENT
Introduction
This is the Application of Ms Essex for leave to appeal out of time from a decision of the Social Securities Appeals Tribunal (“the SSAT”) dispatched 15 June 2010. If successful in her leave Application,
Ms Essex seeks to appeal that decision and requests the matter be remitted to the Tribunal for re-hearing.
Mr Essex opposed the Application for leave to appeal out of time.
Background
The parties were married in June 1981 and separated in January 2000. They have two children. The eldest [X] born [in] 1989 is 21 years of age and the youngest [Y] was born [in] 1995 and is therefore 15 years of age.
The parties have engaged in lengthy litigation since their separation. Property matters were finalised on 22 December 2009 when the Full Court of the Family Court handed down its decision on the Appeal lodged by the wife against the first instance decision of the Family Court.
The issue of the amount of Child Support payable by the husband has been an ongoing matter of contention between the parties with multiple variations and change of assessment decisions arising from objections taken by both parties.
The history of the matter which gives rise to the wife’s Application for leave to appeal out of time be can summarised as follows:
·In 2007 the husband was administratively assessed by the Child Support Agency (“the CSA”) to pay by way of Child Support:
i)an annual rate of $11,837.00 for the period 24 November 2007 to 4 February 2008;
ii)an annual rate of $333.00 for the period 5 February 2008 to 10 February 2008; and
iii)an annual rate of $11,600.00 for the period 11 February 2008 to 30 June 2008.
·On 10 December 2007 the wife lodged with the CSA a request for a change of assessment for the previous 18 months and into the future on the basis of the children’s educational expenses, her own necessary expenses for self-support and the husband’s income, financial resources and earning capacity. The husband lodged a cross application on 18 March 2008 on the basis the wife had greater financial resources than assessed.
·On 8 April 2008 a senior case officer made a decision to depart from the administrative assessment and increased the amount of Child Support payable by the husband for [Y].
·On 27 August 2008 the husband objected to the decision of the senior case officer on the basis the wife did not use the Child Support for school fees but for her own use.
·On 10 October 2008 the wife objected to the decision of the senior case officer on the basis that not all [Y]’s educational expenses had been considered, that she had to pay a significant amount for her own medication and that the husband had access to a greater income and financial resources than considered by the CSA.
·On 14 October 2008 both parties were given an extension of time to lodge their objections with the CSA.
·On 13 March 2009 an objections officer of the CSA disallowed both objections.
·
On 8 April 2009 the wife applied to the SSAT. At hearing on
21 October 2009, the wife sought an adjournment of the hearing pending the decision of the Full Court on property matters.
·After the Full Court decision was handed down on 21 December 2009, the SSAT hearing was relisted on 22 February 2010.
·On 15 June 2010 the SSAT dispatched its decision. The wife received the decision on 21 June 2010 upon her return from holiday.
·The SSAT determined to set aside the decision made by the CSA objections officer on 13 March 2009 and substituted it’s decision that:
i)for the period 5 February 2008 to 30 June 2008 the amount of support payable by the husband should be increased by $1,540.00 per annum which meant his Child Support decreased by $75.00 per week from the determination by the CSA review officer. This left the wife with an overpayment for this period of $1,600.00; and
ii)for the period 1 July 2008 to 31 May 2009 the husband’s rate of Child Support should be increased by $2,240.00. This represented an overpayment of approximately $28.00 per week resulting in an overpayment to the wife of approximately $1,320.00 for this period.
Time Limit on Appeal
As set out previously in this judgment, the Tribunal dispatched its decision on 15 June 2010 and it was received by the wife on
21 June 2010. She filed her Application for leave to appeal from the SSAT decision on 24 September 2010.
Section 110C(1) of the Child Support (Registration and Collection) Act 1988 provides that any appeal to a Court from a from a decision of the SSAT must be commenced in that Court in the time prescribed by that Court’s rules or any extension of time that the Court’s rules allow.
Rule 25A.06(2) of the Federal Magistrates Court Rules 2001
(“the Rules”) provides as follows:
Time limits
(2)A person must file an appeal from a decision of the SSAT within 28 days of receiving a written statement of reasons for the decision under subsection 103X(3) or (5) of the Registration Act.
Rules 3.05(1) and (3) provide:
Extension or shortening of time fixed
(1)The Court may extend or shorten a time fixed by these Rules or by a judgment, decree or order;
…
(3) The time fixed may be extended even if the time fixed has passed.
Thus the question of whether to grant leave to appeal out of time is a discretionary one for the Court.
The principles applicable in the exercise by the Court of its discretion to grant leave to appeal out of time are well established. In the matters of Bagley & Bagley (SSAT Appeal) [2010] FMCAfam 215 and Trejo & Walker & Anor (SSAT Appeal) [2010] FMCAfam 1393 their Honours Federal Magistrates Terry and Sexton, when considering the question of leave to appeal out of time from a decision of the SSAT, cited with approval the High Court decision of Gallov Dawson (1990) 64 ALJR 458 where His Honour Justice McHugh held:
“The discretion to extend time is given for the sole purpose of enabling the court to do justice between the parties …
This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time.”
In Rafter & Rafter [2011] FamCAFC 46 the Full Court of the Family Court in dealing with a question for leave to appeal out of time stated at paragraph 10:
10.In Clivery & Conway [2007] FamCA 1435 the well known principles referable to such leave applications were discussed:
The principles emerging from Gallo v Dawson may be summarised as follows:
·The grant of an extension of time is not automatic.
·The object is to ensure that Rules which fix times do not become instruments of injustice.
·Since the discretion to extend the time is given for the sole purpose of enabling the Court to do justice between the parties, the discretion can only be exercised upon proof that strict compliance with the Rules will work an injustice upon the applicant.
·When determining whether the Rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time.
·When considering an application for extension of time in which to file an appeal or an application, it is necessary also to consider the prospects of success of that appeal or application.
The History of the Proceedings
The history of the proceedings have been succinctly set out earlier in the judgment and will not be repeated here.
Conduct of the Parties
In her affidavit sworn in support of this Application on
21 September 2010 and filed 24 September 2010, the wife explained the reason for her delay in seeking to file an appeal against the decision of the SSAT.
It is the wife’s evidence that when she received the SSAT’s decision, she did not understand it. She tried in vain to speak to her CSA case officer, telephoning regularly between 20 June 2010 and 20 July 2010 and leaving voicemail messages to which she never received a reply.
It is the wife’s evidence that on 30 July 2010 she contacted the Complaints Department of the CSA and requested an investigation into the lack of response to her many messages. On 11 August 2010 she met with two operating supervisors of the CSA with a view to them explaining the SSAT decision dispatched on 15 June 2010.
It was the wife’s evidence she was advised at this meeting to contact the Hobart Community Legal Service (“the HCLS”) to obtain independent legal advice in the matter.
The wife saw a solicitor at the HCLS on 17 August 2010 and was advised that the only solicitor at HCLS with child support expertise was on leave during August 2010. Upon that solicitor’s return all documents, including the decision, were examined. The wife was given advice that the SSAT decision erred in law in several areas and that an appeal could be made against that decision. Having received this advice, the wife immediately lodged her Application for leave to appeal the SSAT decision out of time.
When the wife was challenged as to why she had not sought legal advice immediately upon receipt of the SSAT decision, especially in circumstances where she was not unfamiliar with appeal processes given her experience in the Family Court, it was her evidence she could not afford private legal representation and was not aware of supports outside the CSA until referred to the HCLS by the CSA.
The husband argued that the 15 June 2010 SSAT decision clearly set out the 28 day period in which to appeal. He stated it was unacceptable that the wife did not seek some sort of extension of that time limit prior to the expiration of the 28 day period.
It was the husband’s submission that the Court should require compliance with its own rules and that there was no basis as to why
the Rules should be put to one side in this instance.
Grounds of Appeal
The wife bases her Application on four grounds of appeal which she sets out as follows:
1.That the SSAT erred in law in failing to take into account material provided by the appellant in relation to the payment of school fees by her, and costs of a school trip as required by s 117(2)(ii) of the Child Support (Assessment) Act 1989.
2.The SSAT erred in law by including the capital gains from a sale of property ordered by the Full Court of the Family Court decision dated 22 December 2009 as income earned by the appellant for 2007/2008 financial year, and thereby misrepresenting her income for child support purposes in the said financial year.
3.The SSAT erred in law in failing to take into consideration evidence of the respondent’s financial interests in [S] Trust and monetary payments made to him by [W] Pty Ltd in their determination of his income, property and financial recourses as required by s117(2)(c) of the Child Support (Assessment) Act 1989.
4.The SSAT erred in law in failing to take into account evidence provided to the SSAT by the appellant that the respondent used his car for a greater percentage of non-work purposes than the determination made by the SSAT.
At the hearing of the Application for leave to appeal out of time from the SSAT decision, the solicitor for the wife put submissions to the Court on each of the four appeal grounds proposed by the wife.
In relation to appeal ground one, it was submitted on behalf of the wife that while the SSAT found the parties had a common intention that the child [Y] attend a private school and undertake certain extra curricular activities, they failed to take into account evidence that the wife had paid for some of such expenses in toto.
When considering this issue, the SSAT stated in paragraphs 43 & 44 of the 15 June 2010 decision:
43. Ms. Essex did not dispute Mr. Essex’s evidence that he had been paying [Y]’s school fees since July 2007 and that, before then, the fees were paid out of a joint account… The Tribunal noted the only evidence of the actual fees paid was the statement issued to Mr. Essex in 2007.
44.As Ms. Essex has not been responsible for meeting the cost of [Y]’s tuition in a private school, the Tribunal was not satisfied her costs of maintaining the child were significantly affected by the costs of the private education. The Tribunal concluded there were no special circumstances such as to warrant departure under subparagraph 117(2)(b)(ii).
I could find no reference to the costs of a school trip in the decision of the SSAT.
In relation to the second ground of appeal that the SSAT erred in finding that a refund of Capital Gains Tax (“CGT”) to the parties that had been ordered by the Family Court was “income” for the financial year 2007/2008, it was submitted on behalf of the wife that the monies received were part of a property settlement and were therefore an asset of the parties, not income of the parties.
When considering this issue the Tribunal stated in paragraph 115 of the 15 June 2010 decision:
115.From the evidence provided the Tribunal found that … in 2007/2008 Ms. Essex’s taxable income was $82,633.00 comprising of salary from employment ($38,269.00), government payments, $9,275.00 interest and $42,232.00 capital gains. The Tribunal noted Ms. Essex claimed work related expenses of $14,639.00 in that financial year.
Perusal of the Tribunal’s decision does not reveal whether the wife argued that the refund of CGT should be treated as property and not income. The decision does not indicate the basis upon which the SSAT included the refund of CGT as income for the 2007/2008 year.
In relation to ground three, it was submitted on behalf of the wife that the SSAT erred in not taking into account the husband’s interest in [S] Trust as a financial recourse pursuant to section 117(2)(c) of the Child Support (Assessment) Act 1989. It was submitted that the SSAT failed to give proper weight to the decision of the Full Court of the Family Court where it was held the husband’s interest in [S] Trust was a financial resource of the husband.
When considering this issue the Tribunal stated in paragraphs 91, 95, 101 and 102 of the 15 June 2010 decision:
91.The structure and purpose of the two trusts have been extensively examined by the Family Court, both in its decision of 2 July 2007 and on appeal, in the decision of
22 December 2009. The Full Court of the Family Court specifically addressed whether Mr Essex had a financial resource in the trusts (A7). In making its decision, this Tribunal was bound to adopt the Court’s findings as matters of fact…95.There was no evidence before the Tribunal that the evidence considered by the Court has changed or that there has been doubt cast on the findings of the Court. Accordingly, the Tribunal found that the [S] Trust is a financial resource of
Mr Essex and he is likely to receive income from the trust at the conclusion of the Family Court proceedings. The Family Court concluded in its decision that the income Mr Essex might receive from [S] would be roughly equal to Ms Essex’s earning from employment in 2006. This was thought to be about $23,311 (at paragraph 75 of the Family Court decision; A7, folio 15)…101.The Tribunal carefully examined all bank statements supplied by Mr Essex and found no evidence to support Ms Essex’s notion that Mr Essex received any income from the [S] Trust to the date of hearing. Ms Essex alleged the trust’s accountant had told her Mr Essex was receiving an income, however
Mr Essex supplied copies of letters from the accountant denying her claim. The Tribunal regarded the greater weight on supporting an allegation lies with the person making the allegation. In this case, the Tribunal found no evidence to support Ms Essex’s allegation. The Tribunal was not persuaded the evidence disclosed additional income from the [S] Trust to Mr Essex…102.The Tribunal was therefore satisfied that Mr Essex has not received income from the [S] Trust during the period under review and it noted that the Family Court surmised in its decision of 22 December 2009 that he was likely to receive distributions from the Trust at the conclusion of the proceedings that is after the end of 2009.
In relation to ground four, it was submitted on behalf of the wife that whilst the SSAT accepted the Full Court of Appeal’s finding that the value to be attributed to the provision of the motor vehicle by the husband’s employer was $9,000.00, the SSAT erred in its finding that only five per cent of that figure was attributable to private use.
When considering this issue the SSAT stated in paragraphs 78 to 84 of the 15 June 2010 decision:
Fringe benefits
78.Secondly, Ms Essex argued that Mr Essex’s received additional fringe benefits from his employer as he has a company vehicle and his employer also paid for his meals and accommodation when Mr Essex had to work in Hobart for some time.
79.Mr Essex stated that he does have a company vehicle and estimated that his private use of that vehicle would have been around 33% whilst he was working at [F]. Since working at [H]., he estimated that the private use of the company car is about 5% compared with 95% work use.
Mr Essex thought that a fair estimate of the private benefit he might get from the company car now would be about $50 per week.80.Ms Essex disputed the amount of $50 per week, arguing that the benefit of private use of a company car would be more like $188 per week (A10, folio 1). Ms Essex referred to the change of assessment decision of 2006 which, she believed, used a more accurate reflection of Mr Essex’s benefit from private use of a company car. The Tribunal noted that in this decision the Agency attributed $9,796 fringe benefits to Mr Essex in the 2005/06 financial year but also noted that his personal use of the company car had decreased to just over one third of the year and that a figure of $3,700 was more realistic for the 2006/07 financial year whilst working at [F] (C1, folio 753).
81.The Tribunal noted the judgement of the Family Court on
2 July 2007 which provided for $9,000 per year fringe benefit of Mr Essex’s company car whilst working at [F]. Since February 2008 Mr Essex has been working at [H] and he stated that he now only has 5% private use of the car supplied by the company.82.The Tribunal had no evidence to support Ms Essex’s assertion that Mr Essex had a higher private use of the company car than his estimate of about one sixth of the private use he formerly had. Accordingly, the Tribunal considered that the benefit assigned to the private use of a company car should be less.
83.In estimating fringe benefits in relation to the private use of Mr Essex’s company car, the Tribunal decided to have regard to the Family Court decision on 2007 which attributed fringe benefits of $9,000 to the use of the company car at [F], rather than the lower amount of $3,700 estimated by the Child Support Agency. The Tribunal calculated that a pro-rata reduction from 33% to 5% personal would result in a reduction from $9,000 to about $1,363 (a little over one sixth of the original amount) fringe benefit per year.
84.Mr Essex suggested that the benefit of having access to a company car would be about $2,500 per year ($50 per week). That is more than a third of the value previously assigned and more than the Tribunal’s estimate. In the absence of any other evidence the Tribunal accepted
Mr Essex’s estimate that $2,500 per annum was a reasonable amount of the benefit available to him from his company vehicle.Whilst referring to the husband’s evidence that it was his estimate that his private use of his vehicle has reduced to five per cent, the SSAT’s finding was that $2,500.00 per annum:
“was a reasonable amount of the benefit available to him from his company vehicle”.
The figure of $2,500.00 is 27 per cent of the $9,000.00 attributed as the benefit the husband receives from the use of his company vehicle, not five per cent.
The husband indicated he had not been appraised of the grounds of appeal prior to the Application for leave to appeal out of time coming before the court and was not in a position to comment on their merits. However, it was his observation that all matters raised in the grounds of appeal had been fully ventilated at the SSAT hearing and had been properly determined by the SSAT.
Upon considering the grounds of appeal of the wife, I am satisfied that the appellant has demonstrated an arguable case with respect to at least three of her four grounds of appeal, being Grounds 1, 2 and 3.
Prejudice
The potential prejudice to the wife if leave is not granted for an extension of time to appeal the SSAT decision is that she has no further remedies available to her in relation to the issues raised in her appeal.
The prejudice to the husband if leave is granted relates to the time and costs of having to participate further in these proceedings, including time off work.
Conclusion
While the wife failed to file her Application within the time allowed under the Rules, I am satisfied that the reason for the delay was reasonable and that the wife did all things within her power to obtain the necessary advice as to the meaning of the decision and whether there were grounds to appeal the decision. She acted promptly when such advice was received.
I am also satisfied that there is merit to her appeal. Such finding, it must be noted, in no way pre-empts the final determination of the matter once the benefit of all evidence is before the Court.
Whilst the husband is keen to see an end to the ongoing litigation between himself and the wife, I am satisfied he is not overly prejudiced by a decision to grant the wife’s Application in this matter. A failure to grant leave however, would prejudice the wife.
In all the circumstances I have determined the wife shall be given leave to appeal the decision of the SSAT dispatched on 15 June 2010 out of time.
I certify that the preceding forty-three (43) paragraphs are a true copy of the reasons for judgment of Bender FM
Date: 18 April 2011
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