Evans and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Anor
[2010] AATA 747
•30 September 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 747
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2009/5323
| GENERAL ADMINISTRATIVE DIVISION | ) | ||
| Re | MICHELLE EVANS | ||
Applicant
| And | SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS |
Respondent
| And | MARK HUTCHESSON |
Other Party
DECISION
| Tribunal | Senior Member K Bean |
Date30 September 2010
PlaceAdelaide
| Decision | The Tribunal varies the decision under review so that it provides that: (a) the applicant had a 50% share of the care of her children Roy and Abigail from 11 April 2009 to 5 December 2009; and (b) as a consequence a debt of $280.20 should be raised against her arising from overpayment of family tax benefit for the period from 11 April 2009 to 30 April 2009; and (c) that debt must be recovered. |
..............................................
K BEAN
(Senior Member)
CATCHWORDS
SOCIAL SECURITY – Family Tax Benefit – Order under Family Law Act as to share of care of children – Order not complied with – Father did not consent to lesser share of care – entitlement to FTB to be determined in accordance with share provided in Court order – decision under review affirmed.
A New Tax System (Family Assistance) Act 1999 ss 22, 23, 71, 95, 97
A New Tax System Family Assistance (Administration) Act 1999 s 101
Beadle v Director-General of Social Security (1984) 6 ALD 1
Dranichnikov v Centrelink (2003) 75 ALD 134
Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9
REASONS FOR DECISION
| 30 September 2010 | Senior Member K Bean |
introduction
The applicant (Ms Evans) and the other party (Mr Hutchesson) were at one time married and have two children, Roy and Abigail. Their relationship broke down in 2008 and the two separated. In May 2008, Ms Evans moved to Mount Gambier in South Australia while Mr Hutchesson remained in Casterton, Victoria.
In May 2008, an order was made by consent under the Family Law Act 1975 providing that the children were to reside with Mr Hutchesson and Ms Evans respectively on an equal basis as from the date of Mr Hutchesson “establishing his permanent address in Mount Gambier, South Australia”. Mr Hutchesson established a permanent address in Mount Gambier on 11 April 2009, however the children continued to reside with Ms Evans for the majority of the time until a further court order was made on 5 December 2009.
Ms Evans has sought payment of family tax benefit (FTB) on the basis of the time the children spent with her between 11 April and 5 December 2009. However, under the terms of the relevant legislation, the existence of the family law order is potentially relevant to determining her share of the care of the children for FTB purposes.
In the decision which Ms Evans has asked this Tribunal to review, the SSAT decided by reference to the relevant provisions and the family law order that from 11 April 2009 Ms Evans’ share of the care of the children for FTB purposes was 50%. It also determined that as a result of that conclusion, Ms Evans had been overpaid FTB resulting in a debt of $280.20. However it decided that that debt should be waived due to the special circumstances of the case.
the issues
It follows that the issues for my determination are:
(a)What was Ms Evans’ share of the care of the children for FTB purposes in the relevant period?
(b) Has Ms Evans been overpaid FTB? and
(c)If so, does she owe a debt to the Commonwealth or should any debt be waived or written-off?
What was Ms Evans’ share of the care of the children for ftb purposes in the relevant period?
In determining Ms Evans’ entitlement to FTB during the relevant period, I must have regard to the applicable provisions of the A New Tax System (Family Assistance) Act 1999 (the FA Act). In general terms, these provide that a person’s entitlement to FTB is to be assessed by reference to when a child for whom they are legally responsible is also in their care[1]. However there are some exceptions to this general rule. One of these is when, pursuant to a family law order, a child is supposed to spend time with a particular person and an event occurs without that person’s consent which prevents the child from being in their care as envisaged by the order.
[1] See s 22
In relation to that circumstance, s 23 of the FA Act relevantly provides:
23 Effect of FTB child ceasing to be in individual’s care without consent
(1) This section applies if:
(a)an individual is an FTB child of another individual (the adult) under subsection 22(2) or (3); and
(b)an event occurs in relation to the child without the adult’s consent that prevents the child being in the adult’s care; and
(c)the adult takes reasonable steps to have the child again in the adult’s care.
When the child remains an FTB child of the adult
(2)The child is an FTB child of the adult for that part of the qualifying period (see subsection (5)) for which the child would have been an FTB child of the adult under subsection 22(2) or (3) if the child had not ceased to be in the adult’s care.
…
(5)In this section:
qualifying period means the period beginning when the child ceases to be in the adult’s care and ending at the earliest of the following times:
(a)if the child again comes into the adult’s care at a later time—that later time;
(b)after 14 weeks pass since the child ceased to be in the adult’s care;
(c)if:
(i)the adult is a parent of the child; and
(ii)no family law order, registered parenting plan or parenting plan is in force in relation to the child; and
(iii)the child comes into the care of the other parent at a later time;
that later time.”
In general terms, the effect of this provision is that, for any period (up to
14 weeks) during which a child should have been in the care of a particular person pursuant to a family law order but they were prevented from having the child in their care, the child is nevertheless treated as an “FTB” child of that person for that period, and any entitlements to FTB must be assessed accordingly.
It follows that whilst questions of entitlement to FTB are more typically determined by reference to the factual question of how much time the child or children spent or are expected to spend in the care of the claimant, where s 23 is invoked, that question becomes irrelevant and the person’s entitlement to FTB must be determined by reference to the relevant family law order or plan.
Logically therefore, in considering Ms Evans share of the care of the children for FTB purposes, the first question I must determine is whether s 23 of the FA Act is applicable to her circumstances.
Does s 23 of the FA Act apply?
Ms Evans did not dispute that an order was made under the Family Law Act 1975 on 21 May 2008 which included the following paragraph:
“As from the date of the husband establishing his permanent address in Mount Gambier, South Australia (“the event”) the children reside with the husband and the wife on an equal basis as agreed by the parties or fixed by the Court exercising jurisdiction under the Family Law Act.”
Further, Ms Evans did not dispute that Mr Hutchesson established a permanent address in Mount Gambier on 11 April 2009. However, she contended that the intention of the court orders was that, even after Mr Hutchesson had established a permanent address in Mount Gambier, she and Mr Hutchesson would only share equal care of the children once the practical details of who would have the children when had been agreed between them. In other words, she claimed that the order made on 21 May 2008 was subject to further agreement between them and was not intended to take effect until such agreement had been reached.
She further contended that no agreement had been reached between them as to who would have care of the children at what times before a further Court order was made on 5 December 2009. Accordingly, she contended that for the purposes of assessing the entitlement of each party to FTB, regard should be had to the time the children had spent with each party respectively during the relevant period.
The difficulty with Ms Evans’ position is that, in my view, the Court order referred to above was not intended to take effect only when the practical arrangements for care of the children had been worked out between the parties. Rather, I consider that it was intended by that order that the parties would share care of the children on an equal basis (to be worked out between them) from the date that Mr Hutchesson established a permanent address in Mount Gambier, i.e 11 April 2009.
Further, whilst it was acknowledged by Mr Hutchesson that he did not have care of the children for 50 percent of the time during the relevant period, it was also clear from the evidence of both Ms Evans and Mr Hutchesson that he repeatedly made attempts to gain access to the children throughout the relevant period. However, again on the evidence of both of them, Ms Evans was not willing to allow Mr Hutchesson to have the care of the children for 50 percent of the time during this period and was unco-operative with his attempts to secure equal care of the children. For example, there was no dispute that during one six week period during which Ms Evans said one of the children was sick, Mr Hutchesson was not able to see either child at all, despite his efforts to do so. Ms Evans did not dispute Mr Hutchesson’s evidence in this regard, simply indicating that she felt she was entitled to effectively deny him access to the children, given that no practical arrangements for care of the children had been formally agreed between them.
It follows that in my view the circumstances which must be established in order to invoke s 23 of the FA Act are present in this matter. I am satisfied that during the relevant period there was a family law order in place which required the children to be in the care of Ms Evans and Mr Hutchesson equally. I am also satisfied that this did not occur, but that it did not occur despite Mr Hutchesson’s efforts to obtain access to the children and have them in his care for half of the time.
Relating my findings more closely to the terms of the legislation, I am satisfied that a series of events occurred without Mr Hutchesson’s consent which prevented the children from being in his care for half of the time during the relevant period. I am also satisfied that Mr Hutchesson took “reasonable steps” to have the children in his care. Further I am satisfied on the evidence that the longest period between 11 April and 5 December 2009 during which he did not have the children in his care at all was the period of approximately 6 weeks referred to above. Therefore the period of 14 weeks specified in s 23(5)(b) of the FA Act was not exceeded in respect of any particular “qualifying period”.
I am therefore satisfied that pursuant to s 23(2), the children should be taken to be FTB children of Mr Hutchesson for that part of the period during which the family law order dictated that he should have the children in his care, i.e. 50 percent of the time.
It follows that by reason of the operation of ss 22 and 23 of the FA Act, I consider that during the relevant period the children should be considered to have been in the care of Ms Evans and Mr Hutchesson for 50 percent of the time each and that Ms Evans’ entitlement to FTB should be calculated accordingly.
Has Ms Evans been overpaid?
It follows from my conclusion above that Ms Evans was overpaid FTB in the period 11 April 2009 to 30 April 2009, as she was paid FTB during that period on the basis that she had care of the children for 86 percent of the time. I am also satisfied that the amount of the overpayment was $280.20.
Is the overpayment a debt due to the Commonwealth?
Section 71 of the A New Tax System Family Assistance (Administration) Act 1999 (the Administration Act) relevantly provides as follows:
71Debts arising in respect of family assistance other than child care benefit and family tax benefit advance
No entitlement to amount
(1) If:
(a) an amount has been paid to a person by way of family tax benefit, baby bonus or maternity immunisation allowance (the assistance ) in respect of a period or event; and
(b) the person was not entitled to the assistance in respect of that period or event;
the amount so paid is a debt due to the Commonwealth by the person.
Overpayment
(2) If:
(a) an amount (the received amount ) has been paid to a person by way of assistance; and
(b) the received amount is greater than the amount (the correct amount ) of assistance that should have been paid to the person under the family assistance law;
the difference between the received amount and the correct amount is a debt due to the Commonwealth by the person.
As Ms Evans has been paid an amount of FTB (of $280.20) in excess of her entitlement, I am accordingly satisfied that that amount constitutes a debt owed to the Commonwealth.
Should all or part of the debt be written-off or waived?
Section 95(2) of the FA Act allows for a debt to be written-off in certain circumstances, one of which is that the debtor has no capacity to repay. However, prior to the SSAT’s decision to waive the debt, Ms Evans had in fact repaid it and I do not consider s 95(2) to be applicable in her case.
Section 97 allows for a debt to be waived either in part or in full where there is an administrative error made by the Commonwealth. However, in Ms Evans’ case there is nothing to suggest that the debt arose solely from administrative error and therefore the provisions in s 97 are also not applicable to her case.
Section 101 of the Administration Act also provides for waiver in special circumstances and provides as follows:
“101 Waiver in special circumstances
The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii)failing or omitting to comply with a provision of the family assistance law; and
(b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c)it is more appropriate to waive than to write off the debt or part of the debt.”
As noted above, the SSAT considered that “special circumstances” within the meaning of this provision were present and accordingly decided to waive the debt. The matters which the SSAT considered amounted to special circumstances included the fact that, on the material before it, Ms Evans:
“…
·Did not know of Mr Hutchesson’s intentions to commence sharing the care of the children on a week on week off basis until 11 April 2009 and was therefore not in a position to have advised Centrelink of this prior to the event;
·The change to the care arrangements took Ms Hutchesson by surprise ‘as she had attributed a different meaning to the court order’;
·On 11 April 2009 when Mr Hutchesson advised Ms Hutchesson that he would be commencing the new care arrangements ‘there had been no discussion between the parties or through their legal representatives as to how these new arrangements would work’;
·‘Ms Hutchesson has experienced a series of traumatic events over the last 18 months that have included domestic violence, serious financial difficulties and the loss of employment, the break up of her marriage and personal distress. The Tribunal accepts that Ms Hutchesson has had to borrow the money to repay the debt and that her current living arrangements are inadequate.”[2]
The SSAT concluded:
“The Tribunal finds that when considered together, the above considerations constitute special circumstances and justify waiver of the debt. The Tribunal has concluded that the recovery of the debt has been unfair in Ms Hutchesson’s case, and that Ms Hutchesson can be refunded the full amount that has been recovered.”[3]
[2] T2/16
[3] T2/16
In her evidence to this Tribunal however, Ms Evans simply indicated that she had paid the debt off previously and if it was reinstated, she would pay it off again. It was also clear from her evidence before this Tribunal that the question of her not having had an opportunity to advise Centrelink of the change in care arrangements did not arise, since she took the view that no change would occur until practical arrangements for access to the children were agreed between herself and Mr Hutchesson. From Ms Evans’ point of view, there had been no significant change in the care arrangements and therefore there was nothing to advise Centrelink of at that stage. Further whilst Ms Evans’ understanding of the family law order has proven to be incorrect, it does not follow in my view that there is any significant unfairness or injustice to her in assessing her entitlements having regard to the true position, particularly when the resulting debt amount is so low.
Accordingly, having regard to the applicable case law[4], and the small amount of the debt, I do not consider Ms Evans’ circumstances constitute “special” circumstances in the relevant sense such as to justify waiver of the debt.
[4] Beadle v Director-General of Social Security (1984) 6 ALD 1; Dranichnikov v Centrelink (2003) 75 ALD 134; Angelakos v Secretary, Department of Employment and Workplace Relations (2007) 100 ALD 9
I have therefore decided to vary the decision of the SSAT so as to reinstate a debt of $280.20.
conclusion
In summary, it is clear on the evidence that the children were physically with Ms Evans for more than 50% of the time during the relevant period. However I am satisfied that it was the intention of the family law order made on 21 May 2008 that from 11 April 2009 the care of the children was to be divided equally between Mr Hutchesson and Ms Evans. In these circumstances, the effect of s 23 of the FA Act is to treat the children as having been in the care of each of them for 50% of the time for the purposes of assessing their respective entitlements to FTB. I have accordingly concluded that the decision of the SSAT was correct to decide that Ms Evans was entitled to FTB during the relevant period on the basis that she had 50% care of the children.
I have also concluded that Ms Evans was therefore overpaid FTB in the period 11 April 2009 to 30 April 2009 in the amount of $280.20, that that amount constitutes a debt to the Commonwealth and the debt should not be written off or waived.
decision
The Tribunal varies the decision under review so that it provides that:
(a) the applicant had a 50% share of the care of her children Roy and Abigail from 11 April 2009 to 5 December 2009; and
(b) as a consequence a debt of $280.20 should be raised against her arising from overpayment of family tax benefit for the period from 11 April 2009 to 30 April 2009; and
(c) that debt must be recovered.
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