Esson and Esson (Child support) - [2020] AATA 5571

Esson and Esson (Child support) [2020] AATA 5571 (11 November 2020)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2020/MC019420
APPLICANT:  Mr Esson
OTHER PARTIES:  Child Support Registrar
Ms Esson

TRIBUNAL:Member K Dordevic
DECISION DATE: 11 November 2020
DECISION:

The tribunal sets aside the decision under review and, in substitution, decides that for the period 31 July 2019 until a terminating event occurs in relation to [Child 1] a nil annual rate of child support is payable by Mr Esson and Ms Esson.

CATCHWORDS

CHILD SUPPORT – departure determination – income, property and financial resources of the receiving parent – benefits derived from business – education costs – 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

The Child Support (Assessment) Act 1989 (the Act) provides for an administrative assessment of the child support payable. It uses a formula which contains variables such as the parents’ adjusted taxable incomes and their percentages of care of the children. The Act also provides for a departure from the administrative assessment in certain circumstances.
This case was registered with the Department of Human Services – Child Support on 31 July 2019 and has been collectable since 6 September 2019. There are five children of the marriage, three of whom are under 18 years of age. Only two of these three children are subject to the assessment as the third [child] was placed in the parties’ long-term care. The children relevant to this review are recorded as being in the parties’ shared care. The older child, [named], will cease to be a child of the assessment after 13 November 2020.
The mother lodged a change of assessment application on 29 August 2019. On 19 December 2019 a senior case officer refused the application. The mother sought a review of that decision on 2 January 2020. On 4 March 2020 an objections officer allowed the objection, determining that for the period 13 August 2019 to 12 August 2021 the father’s adjusted taxable income is increased to $68,961 and on 13 August 2020 and each year thereafter the father’s adjusted taxable income is increased by the child support inflation factor.
On 29 April 2020 the father sought further review with the Social Services and Child Support Division of the Administrative Appeals Tribunal (the tribunal). A directions hearing was held on 23 September 2020 and directions were issued, requiring compliance by 23 October 2020.
The tribunal heard the matter on 11 November 2020. The mother and father appeared by conference telephone. The Child Support Registrar was not represented at the hearing. The tribunal has considered the sworn evidence of the mother and father. The tribunal also considered the documentation provided by the Department (folios 1-431), the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2020] AATA 5571
Decision Date

CaseChat Overview and Summary

This matter concerned a review by the Administrative Appeals Tribunal (AAT) of a decision regarding child support payable between Mr. Esson (the father) and Ms. Esson (the mother). The dispute arose from an application to depart from the standard administrative assessment of child support, with the mother seeking a review of a decision that had increased the father's adjusted taxable income for child support purposes. The tribunal was required to determine whether a ground existed for departure from the administrative assessment and, if so, whether making a particular determination would be just, equitable, and otherwise proper.

The primary legal issue was whether the father's actual income and financial resources were not accurately reflected in the child support assessment, thereby creating an unjust and inequitable situation. This involved scrutinising the father's various income streams, including his employment, private practice, and business activities, and comparing them to his declared taxable income. The tribunal also considered the parties' financial circumstances, including their assets, liabilities, and expenditures, as well as a pre-existing financial agreement concerning the children's private education costs.

The tribunal found that the father's income tax returns did not accurately reflect his financial position, particularly due to his failure to make full and frank disclosure of his income and financial resources. The tribunal calculated that the father's actual income and financial resources significantly exceeded his declared taxable income, suggesting he had a greater capacity to contribute to the children's support than the administrative assessment indicated. Despite the existence of a financial agreement regarding education costs, the tribunal concluded that the father's undisclosed income and financial resources meant that applying the standard administrative assessment would result in an unjust and inequitable determination of child support. The tribunal was persuaded by the mother's submissions that the father's child support liability should be set at nil, and given the terms of the financial agreement and the father's financial capacity, the mother's liability should also be set at nil.

Consequently, the tribunal set aside the previous decision and substituted an order that for the period from 31 July 2019 until a terminating event occurred in relation to one of the children, a nil annual rate of child support would be payable by both Mr. and Ms. Esson. This departure was deemed to be just, equitable, and otherwise proper, ensuring a more appropriate apportionment of financial responsibility between the parents. The tribunal also noted that setting a nil rate created an overpayment by the father, which he could repay without hardship.

Orders