Fergueson and Bagdonas (Child support)

[2018] AATA 3791

Fergueson and Bagdonas (Child support) [2018] AATA 3791 (6 August 2018)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/MC014275

APPLICANT:  Mr Fergueson

OTHER PARTIES:  Child Support Registrar

MsBagdonas

TRIBUNAL:Member S Lewis

DECISION DATE:  06 August 2018

DECISION:

The tribunal sets aside the decision under review and, in substitution, decides that the following payments by Mr Fergueson are to be credited under section 71C of the Child Support (Registration and Collection) Act 1988:

·20 September 2017:                   $280

·5 October 2017:  $280

·18 October 2017:  $280.

CATCHWORDS
Child support - Prescribed non-agency payments - Whether payments made for essential medical services - Three payments meet the criteria for prescribed payments - 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 whether payments for family therapy and the preparation of a court ordered report can be credited against Mr  Fergueson’s child support liability.

2. Mr Fergueson and Ms  Bagdonas are the parents of [Child 1] and [Child 2]. Mr Fergueson is the liable parent in a child support assessment made by the Department of Human Services – Child Support (the Department). His liability under the assessment has been registered for collection by the Department since 17 May 2016.

3. At relevant times the child support assessment was based on Ms Bagdonas having care percentages of 100% for the children and Mr Fergueson having care percentages of 0%.

4. Mr Fergueson requested that the Department credit the following payments for court ordered family therapy and the preparation of a report (being Ms Bagdonas’s 50% share of the costs) against his child support liability:

   ·Family therapy                20 September 2017:              $280

   ·Family therapy                5 October 2017:  $280

   ·Family therapy                18 October 2017:                   $280

   ·Preparation of report       9 December 2017:                 $308.

5. On 4 January 2018, an employee of the Department decided that the payments could not be credited as non-agency payments on the basis that there was no mutual intention that the payments were made in lieu of child support.

6. Mr Fergueson objected to the decision.  His objection was allowed in part on 29 May 2018.  The objections officer found that the payments for family therapy were made as essential psychological services for the children and so could be considered as prescribed non-agency payments.  The objections officer found that the invoices provided by Mr Fergueson indicated that Mr Fergueson had paid $280 on 20 September 2017 and $20 on 18 October 2017, being Ms Bagdonas’s share of the cost.  These amounts were accepted as prescribed non-agency payments.  The remaining therapy fees were not accepted as the objections officer was not satisfied that they had been paid in full.  The fee for the report was not accepted as an essential medical service and so was not a prescribed non-agency payment. 

7. On 7 June 2018, Mr Fergueson lodged an application with the Administrative Appeals Tribunal (the tribunal) seeking review of the decision of the objections officer. 

8. The matter was heard on 6 August 2018. The tribunal and the parties also had access to the statement and documents provided by the Department under subsection 37(1) of the Administrative Appeals Tribunal Act 1975 (folios 1 to 72).  Mr Fergueson attended the hearing by conference telephone.  Ms Bagdonas did not attend the hearing.  Mr Fergueson gave evidence on affirmation. 

ISSUE

1. The Department (acting for the Child Support Registrar) can credit payments made by a liable parent to a third party against an enforceable maintenance liability.

2. The term ‘enforceable maintenance liability’ is defined in subsection 4(1) of the Child Support (Registration and Collection) Act 1988 (the Act) as a registered maintenance liability. A ‘registered maintenance liability’ is defined by subsection 4(1) as one that is registrable under sections 17 and 18 of the Act. This includes a child support liability that arises under a child support assessment that is registered for collection by the Department.

3. Section 71A of the Act states that an amount paid by a payer to a third party can be credited provided there is an enforceable maintenance liability and both parents intend that the payment is in satisfaction of child support payable under that liability.

4. Section 71C of the Act allows for the gradual crediting of payments (up to 30% of the child support liability for a period) where they fall into categories set out in regulation 5D of the Child Support (Registration and Collection) Regulations 1988 (the Regulations) regardless of the parents’ intentions.  Regulation 5D provides, in part:

   For paragraph 71C(1)(b) of the Act, specified payments are payments of the following kinds:

   …

   (c)fees for essential medical and dental services for that child.

5. Section 71C of the Act requires that the liable parent has less than ‘regular care’ of any of the children of the assessment, both at the time the payment was made and when the decision is made to credit the amount. The term ‘regular care’ is defined in subsection 5(2) of the Child Support (Assessment) Act 1989 as a percentage of care of at least 14%, but less than 35%.

6. Amounts credited under section 71C of the Act cannot exceed 30% of the amount payable in the payment period. Excess amounts may be credited against the liability for a later payment period if the criteria are met at that time. No amount can be credited unless the payer has paid the remaining 70% of the liability.

7. Sections 71A and 71C are subject to section 71D of the Act which provides that the Registrar may refuse to credit an amount under those sections if satisfied that, in the circumstances of the particular case, the amount ought not to be credited.

CONSIDERATION

1. There has been an enforceable maintenance liability in place in this case since at least 17 May 2016. The tribunal finds that at all relevant times Mr Fergueson was the liable parent.

2. Based on the invoices provide by Mr Fergueson to the Department after the objections officer’s decision, the tribunal finds that therapy payments of $840 and a report preparation fee of $308 were made by Mr Fergueson.  The tribunal accepts that the therapy payments were made to [Psychologist 1] for family therapy services for the children.  Mr Fergueson explained that he has only sought reimbursement for the psychological services provided for the children.  The additional family therapy sessions involving the parents have not been included.  The tribunal also accepts that the fee for the report was for a court ordered report in relation to the family therapy provided by [Ms A].

3. There was no evidence that Mr Fergueson and Ms Bagdonas had discussed that any of the payments identified were in lieu of child support.  Mr Fergueson told the tribunal that, as the therapy sessions and subsequent report were the subject of court orders, it would be fair to credit the amounts identified against his child support liability.  Mr Fergueson explained that the sessions had to be paid for and Ms Bagdonas refused to pay.  He said he paid in order to progress the matter.  Mr Fergueson did not dispute that Ms Bagdonas did not have an intention to accept the payments were in lieu of child support.

4. On the evidence provided, the tribunal is not satisfied that the payments (or any component of the payments) were intended by Ms Bagdonas to be payments in lieu of child support at the time those payments were made. The tribunal finds that the payments (or any part of the payments) cannot be credited under section 71A of the Act.

5. The tribunal then considered whether the therapy payments and the report fee should be credited as non-agency payments as prescribed under sub-regulation 5D(c) of the Regulations.  The tribunal accepts that at relevant times Mr Fergueson did not have regular care of either of the children.

6. It is undisputed that the family therapy payments were made for counselling services provided by a psychologist to the children.  The tribunal was satisfied that the payments by Mr Fergueson for family therapy for the children meet the criteria in section 71C as a prescribed non-agency payment (essential medical services) and must be credited to the child support liability pursuant to section 71C of the Act.  The tribunal finds that the following payments must be credited as non-agency payments:

   ·Family therapy                20 September 2017:              $280

   ·Family therapy                5 October 2017:  $280

   ·Family therapy                18 October 2017:                   $280.

7. The tribunal also considered whether there were any circumstances in this case which suggested that the amounts paid for family therapy for the children ought not to be credited.  Based on the available evidence, the tribunal finds that there are no such circumstances. 

8. Having considered the evidence, including the court orders and the relevant law, the tribunal finds that report preparation fee lacks the necessary character of ‘essential medical services’ for the children – the report arose out of family therapy sessions for the children as well as the parents for the use of the court.  The court preparation fee cannot be credited under section 71C of the Act, in whole or in part.

DECISION

The tribunal sets aside the decision under review and, in substitution, decides that the following payments by Mr Fergueson are to be credited under section 71C of the Child Support (Registration and Collection) Act 1988:

·20 September 2017:                   $280

·5 October 2017:  $280

·18 October 2017:  $280.