Falvey and Bourke (Child support)

[2019] AATA 1192

Falvey and Bourke (Child support) [2019] AATA 1192 (14 March 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/SC015200

APPLICANT:  Ms Falvey

OTHER PARTIES:  Child Support Registrar

Mr Bourke

TRIBUNAL:Senior Member R Ellis

DECISION DATE:  14 March 2019

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that the prescribed non-agency payment amounts credited on 31 May 2017 of $43.22, on 30 June 2017 of $43.22, on 9 September 2017 of $10.35, on 4 October 2017 of $10.35, on 1 March 2018 of $45.95, on 2 May 2018 of $45.95, on 6 June 2018 of $45.55, on 3 July 2018 of $45.55 and on 1 August 2018 of $45.55 should not be credited.

CATCHWORDS

CHILD SUPPORT – non-agency payment - prescribed payments - whether the Child Support Registrar has jurisdiction to credit payments previously refused by the AAT differently constituted - payments should be refused - 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

BACKGROUND

1. This review is about the individual allocations, or credits, of prescribed non-agency payments applied to the child support account of Mr Bourke.  The total credited prescribed non-agency payments being reviewed is $269.95.

2. Ms Falvey and Mr Bourke are the parents of [Child 1] (born October 1998) and [Child 2] (born January 2001).   Mr Bourke has been liable to pay child support to Ms Falvey for [Child 1] from 16 November 1998 and for [Child 2] from 17 June 2010.

3. The Department of Human Services, Child Support (the Child Support Agency) made the following decision(s) concerning the allocations of credits of prescribed non-agency payments previously accepted for school fees paid by Mr Bourke between June and November 2011:

   ·     on 31 March 2017 a credit of $43.22;

   ·     on 30 April 2017 a credit of $43.22;

   ·     on 31 May 2017 a credit of $43.22;

   ·     on 30 June 2017 a credit of $43.22;

   ·     on 9 September 2017 a credit of $10.35;

   ·     on 4 October 2017 a credit of $10.35;

   ·     on 1 March 2018 a credit of $45.95;

   ·     on 2 May 2018 a credit of $45.95;

   ·     on 6 June 2018 a credit of $45.55;

   ·     on 3 July 2018 a credit of $45.55; and

   ·     on 1 August 2018 a credit $45.55.

4. On 18 October 2017 Ms Falvey objected to these decision(s) and on 10 September 2018 the Child Support Agency allowed the objection in part and made the following decision(s) (the objection decision):

   ·     the amount of $43.22 credited on 31 March 2017 was reduced to $0;

   ·     the amount of $43.22 credited on 30 April 2017 was reduced to $0;

   ·     the amount of $43.22 credited on 31 May 2017 was reduced to $10.35;

   ·     the amount of $43.22 credited on 30 June 2017 was reduced to $10.35;

   ·     the amount of $10.35 credited on 9 September 2017 was not changed;

   ·     the amount of $10.35 credited on 4 October 2017 was not changed;

   ·     the amount of $45.95 credited on 1 March 2018 was not changed;

   ·     the amount of $45.95 credited on 2 May 2018 was not changed;

   ·     the amount of $45.55 credited on 6 June 2018 was not changed;

   ·     the amount of $45.55 credited on 3 July 2018 was not changed; and

   ·     the amount of $45.55 credited on 1 August 2018 was not changed.

5. On 10 October 2018 Ms Falvey applied to the Administrative Appeals Tribunal (the Tribunal) for a review of the objection decision.

6. The matter was considered on 26 February 2019.  Ms Falvey and Mr Bourke gave evidence on affirmation by conference telephone.  The Child Support Agency provided the Tribunal and the parties with a bundle of documents relevant to the review (969 pages).  Ms Falvey provided additional evidence prior to the hearing which was also distributed to the parties (A1-A79).

ISSUES

1. The statutory provisions relevant to this review are contained in the Child Support (Registration and Collection) Act 1988 (the Act).

2. When a child support liability is registered under the Act for collection, the amount payable is a debt due to the Commonwealth and must be paid to the Child Support Agency not the payee.  In some circumstances the Child Support Agency may credit payments made directly to a payee or to a third party against a child support liability that is registered for collection (sections 71, 71A and 71C of the Act).  The Child Support Agency refers to the credits under sections 71 and 71A as ‘non-agency payments’ and the credits under section 71C as ‘prescribed non-agency payments’ as this section applies to payments of the kind specified in regulation 5D of the Child Support (Registration and Collection) Regulations 1988, as in force at that time.

3. Section 71C of the Act provides a mechanism whereby payments made by a liable parent for items specified in regulation 5D may be taken into account in partial satisfaction of the liable parent’s child support liability.  A number of specific criteria must be satisfied for this provision to apply.  Even where all the criteria are met, there is still a discretion in section 71D of the Act to refuse to credit amounts that would otherwise be able to be credited against the liability.

4. The issue which arises in this case is whether or not the prescribed non-agency payment credits can be applied to Mr Bourke’s child support account.

CONSIDERATION

1. At the commencement of the hearing Mr Bourke sought clarification from the Tribunal about the total amount of prescribed non-agency payments under consideration.  The Tribunal advised Mr Bourke the amount reviewed in the original decision was $422.13 but notes the total credited prescribed non-agency payments being reviewed by the Tribunal is $269.95.[1]

   [1]On objection the amounts of $43.22 credited on 31 March 2017 and $43.22 credited on 30 April 2017 were reduced to $0.  On objection the amounts of $43.22 credited on 31 May 2017 and $43.22 credited on 30 June 2017 were reduced to $10.35.

2. Mr Bourke told the Tribunal that his child support account was already in credit and he wanted to pay Ms Falvey whatever the balance was between this credit and the total amount of prescribed non-agency payments under consideration.  Mr Bourke said if he paid this balance to Ms Falvey there would be no need to proceed with the hearing.  Mr Bourke pointed out the child support case had already ended and he felt the hearing was a waste of time.

3. The Tribunal put this proposition to Ms Falvey who said she did not wish to accept the offer made by Mr Bourke.  Mr Bourke said not accepting his offer to forego the prescribed non-agency payments simply reiterated the vexatious nature of the applicant.

4. The Tribunal notes in the objection decision that the allocations of credits applied by the Child Support Agency came from two of three groups of prescribed non-agency payments (group 1, group 2(a) and group 2(b)).  The three groups of payments cover a total of $2,637.00 of school fees paid by Mr Bourke between June and November 2011.

5. The amount credited on 31 May 2017 of $43.22, the amount credited on 30 June 2017 of $43.22, the amount credited on 9 September 2017 of $10.35, the amount credited on 4 October 2017 of $10.35, the amount credited on 1 March 2018 of $45.95, the amount credited on 2 May 2018 of $45.95, the amount credited on 6 June 2018 of $45.55, the amount credited on 3 July 2018 of $45.55 and the amount credited on 1 August 2018 of $45.55 all come from group 1.

6. The amount of $43.22 credited on 31 March 2017 and the amount of $43.22 credited on 30 April 2017 were both reduced to $0 on objection.  As this was to the benefit of Ms Falvey and Mr Bourke has not sought review of the two credits being reduced to $0, the Tribunal will not consider these.

7. The Tribunal also notes in the objection decision that group 1 consists of three payments of school fees which were originally notified on 15 September 2011 with a primary decision made on 15 September 2011 to accept them as prescribed non-agency payments totalling $1,318.80.  The objection decision states the following in relation to this group:

   Since 15 September 2011, various amounts of credits had been allocated out of Group 1 onto the child support account.  However, there have also been reversals of credits removing those allocations out of the child support account.

   As of 3 June 2016 all the previous allocations of credits from this group of payments had been reversed off the child support account back into the pool of unallocated (uncredited) PNAPs.

8. The Child Support Agency reversed these credits following a decision by the Tribunal on 11 April 2016 which found that the prescribed non-agency payment credits previously allocated from group 1 had been made at a time when the requirements of the Act had not been fully met.  In that 11 April 2016 decision Deputy President Walsh argued that Mr Bourke had not met the requirements of the Act in relation to these prescribed non-agency payments and was not “entitled” to have crediting decisions made in his favour.  Deputy President Walsh determined that the prescribed non-agency payments should not be credited.

9. The Child Support Agency has subsequently made a policy decision that these credits remain available for future allocation against the child support liability once all conditions of the Act are met.  The Child Support Agency has interpreted the decision made by Deputy President Walsh does not mean that a prescribed non-agency payment credit can never be allowed in relation to these particular payments.  The Tribunal is not of this opinion.

10. The Tribunal does not accept the proposition by the Child Support Agency that if circumstances change and the conditions of the Act are met then these prescribed non-agency payments can be credited.  The prescribed non-agency payment credits made from group 1 have previously been considered and refused by the Tribunal in its decision of 11 April 2016.

11. Notwithstanding this view, Mr Bourke offered to forego the prescribed non-agency payments in question.  Ms Falvey refused despite this offer being to her advantage.

12. Section 71D of the Act states that the Child Support Agency “may refuse to credit an amount under section 71, 71A or 71C if satisfied that, in the circumstances of the particular case, the amount ought not to be credited”.  The title of section 71D is "Registrar may refuse to credit amounts in special circumstances".

13. Even if not for the reasons given in paragraph 20 above, the Tribunal would have been satisfied, in the circumstances of this particular case, that the prescribed non-agency payment credits under consideration should be refused.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that the prescribed non-agency payment amounts credited on 31 May 2017 of $43.22, on 30 June 2017 of $43.22, on 9 September 2017 of $10.35, on 4 October 2017 of $10.35, on 1 March 2018 of $45.95, on 2 May 2018 of $45.95, on 6 June 2018 of $45.55, on 3 July 2018 of $45.55 and on 1 August 2018 of $45.55 should not be credited.