FFTS and Child Support Registrar (Child support second review)
[2022] AATA 2546
•25 July 2022
FFTS and Child Support Registrar (Child support second review) [2022] AATA 2546 (25 July 2022)
Division:GENERAL DIVISION
File Number(s):2022/2995
Re:FFTS
APPLICANT
Child Support Registrar And
RESPONDENT
And FKGR
OTHER PARTY
WRITTEN REASONS FOR ORAL DECISION
Tribunal:Senior Member G Lazanas
Date: 25 July 2022
Date of written reasons: 12 August 2022
Place:Sydney
The Tribunal decided, pursuant to section 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth), that the operation of the decision of the Social Services & Child Support Division of the Tribunal (AAT1) dated 21 March 2022 is stayed until the decision of the Tribunal on the application for review (AAT2) comes into operation or until further order of the Tribunal.
.............................[SGD]..................................
Senior Member G Lazanas
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.
CATCHWORDS
CHILD SUPPORT – INTERLOCUTORY – practice and procedure – stay order application – percentage of care decision – whether stay order would secure effectiveness of hearing – prospects of success – prejudice or hardship – stay order granted
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) s 41
Child Support (Assessment) Act 1989 (Cth) s 54F
Child Support (Registration and Collection) Act 1988 (Cth) ss 94H, 95N
CASES
Commonwealth of Australia and Quirke [1986] AATA 57; (1986) 9 ALD 92
Dart and Director-General of Social Services (1982) 4 ALD 553
Dekanic and Tax Agents’ Board of New South Wales (1982) 6 ALD 240
Samir Pty Ltd and Aged Care Standards and Accreditation Agency [2012] AATA 333
Scott and Australian Securities and Investment Commission [2009] AATA 798
Secretary, Department of Employment and Workplace Relations and Anastasiadis [2007] AATA 1065
REASONS FOR DECISION
Senior Member Lazanas
12 August 2022
INTRODUCTION
The Applicant (Mother) and the Other Party (Father) are separated parents of three children including, Child B (now aged 20) and Child C (now aged 16).
On 12 April 2022, the Mother applied to this Tribunal, the General Division of the Administrative Appeals Tribunal (AAT2), for a second-tier review of a decision by the Social Services and Child Support Division of the Tribunal (AAT1) on 21 March 2022 in relation to child support payments for Child B (AAT1 Decision).
On 29 June 2022, the Mother applied to the Tribunal for a stay order in relation to the AAT1 Decision regarding child support payments for Child B. The Father opposed the stay order. The Child Support Registrar (Registrar) did not oppose the stay order and remained neutral. The Registrar, however, did provide submissions on a jurisdictional aspect of the AAT1 Decision, to which I will come to shortly.
The Mother stated that the AAT1 Decision led to the backdating of the care change decision to a date in June 2019 and that, consequently, she had been overpaid by the Other Party in relation to Child B. However, the Mother is challenging the correctness of the AAT1 Decision on two grounds. Firstly, the Mother argues that AAT1 was incorrect to conclude that her care percentage in respect of Child B was 0% because she did have care of Child B even though Child B was living away from home. Secondly, the Mother argues that AAT1 exceeded its jurisdiction in deciding that there was a “child support terminating event” under the Child Support (Assessment) Act 1989 (Cth) (Assessment Act). The Registrar agreed with the Mother’s position in relation to AAT1’s jurisdiction and stated that AAT1 was unable to decide whether there was a “child support terminating event” in circumstances where this was not before AAT1 as part of the reviewable decision.
The sole issue that required determination by this Tribunal in the interlocutory application is whether the Tribunal should exercise its discretion under s 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) to grant the stay order applied for by the Mother.
For the following reasons, I decided to grant the stay order in respect of the AAT1 Decision.
PROCEDURAL BACKGROUND
The hearing of this interlocutory application took place on 25 July 2022. The Tribunal spoke to the Mother and the Father separately by telephone. Both were self-represented. The Registrar was represented by Mr Taverniti from Sparke Helmore Lawyers who participated in the separate telephone discussions involving the Mother and the Father.
The Tribunal considered the oral submissions of the parties, together with the following materials:
(a)the Mother’s request for a stay order dated 29 June 2022;
(b)two emails from the Father dated 30 June 2022 and 1 July 2022; and
(c)the section 37 documents (T documents and supplementary T documents) filed by the Registrar and numbered T1 to T128 and ST1 to ST5 together comprising 817 pages.
I provided my decision to grant the stay order and oral reasons to the Mother and the Child Support Registrar at the hearing. I was unable to provide oral reasons to the Father as he terminated the telephone call upon hearing my decision. For completeness, I note the Tribunal received further correspondence from the Father dated 26 July 2022 which included further submissions and requested written reasons for my decision.
THE TRIBUNAL’S STAY POWER
The filing of an application to review a decision with the Tribunal will not automatically prevent the decision from taking effect. Section 41(1) of the AAT Act states:
(1)Subject to this section, the making of an application to the Tribunal for a review of a decision does not affect the operation of the decision or prevent the taking of action to implement the decision.
Section 41(2) of the AAT Act permits a party to apply to the Tribunal for a stay order with respect to an operative decision which affects a person’s rights. The Tribunal will only grant a stay order if there is something for the stay order to operate on. Relevantly, the subject of the Mother’s stay order application is the AAT1 Decision.
Section 41(2) of the AAT Act states:
(2)The Tribunal may, on request being made by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.
As stated above, if the Tribunal grants a stay order under s 41(2) of the AAT Act, it will stop a decision from taking effect until the final determination of the matter following the substantive hearing. Section 41(4)(a) of the AAT Act also provides that the Tribunal will not grant a stay order unless the parties have been given a reasonable opportunity to make submissions to the Tribunal.
In determining whether a stay is appropriate, the Tribunal may consider a range of matters including the prospects of success; the consequences for the applicant of the refusal of a stay; the public interest; the consequences for the respondent in carrying out its functions depending upon whether a stay is granted or not; whether the application for review would be rendered nugatory if a stay were not granted; and other matters that are relevant including, the prejudice or hardship that the parties, or other persons whose interests may be affected by the review, may suffer: see Scott and Australian Securities and Investment Commission [2009] AATA 798 and Dekanic and Tax Agents’ Board of New South Wales (1982) 6 ALD 240.
THE FACTUAL BACKGROUND
It was common ground before AAT1 that from 27 July 2016 onwards, the care percentages for Child B were recorded by the Agency as 100% to the Mother and 0% to the Father.
On 11 June 2019, the Father contacted the Agency and advised that the Mother had not had any care of Child B since 10 May 2019. In essence, the Father’s case was that Child B lived independently of the Mother. The Mother disagreed with the Father’s notification.
On 27 June 2019, the Agency decided not to change the care percentages, and, in early July 2019, the Father objected to that decision.[1] On 9 September 2019, the Registrar disallowed the objection.[2]
[1] T-Documents at T28, p 183.
[2] T-Documents at T8, pp 79-83.
In July 2020, Child B turned 18. Beforehand, on 9 June 2020, the Registrar had decided to extend the child support case for Child B to the end of the school year being the date of 10 November 2020, following an application made by the Mother. On 9 July 2020, the Father wrote to the Registrar stating that he disagreed with that decision.
In the AAT1 Decision, AAT1 described the case as “a most unusual, difficult and complex matter” and concluded, as follows:
·Child B left home and the care of the Mother on 14 June 2019;
·The care percentage of the Mother of 100% is revoked under section 54F of the Act from midnight on 13 June 2019;
·Her new care percentage is 0% from 14 June 2019;
·While new care percentages in care percentage decision matters are generally not “effective” because of section 95N of the [Child Support (Registration and Collection) Act 1988 (Cth)], until the date an appeal was lodged, which was 28 August 2021[…], as this matter has revealed that a child support terminating event occurred on 14 June 2019, then the Registrar “must” now give immediate effect to that terminating event;
·Accordingly, the child support case must now be terminated, retrospectively, as at 14 June 2019.
The decision of AAT1 was as follows:
·The decision under review is set aside and a new care determination made that the care percentages in respect of Child B were 0% to each parent from 14 June 2019;
·Section 94H of the Child Support (Registration and Collection) Act 1988 applies in this matter, and no special circumstances prevented [the Father] from lodging his appeal to the Tribunal at any earlier time than he did (which was on 28 August 2021); but;
·A “child supporting terminating event” occurred on 14 June 2019, and the Registrar must now give immediate effect to that child support terminating event.
The debt owed because of the AAT1 Decision by the Mother to the Father appears to be approximately $14,000 (Debt). Although the Father is still liable to pay the Mother child support for Child C, the AAT1 Decision allows the Debt to be set off from the child support payments that the Father is liable to pay for Child C.
SHOULD THE TRIBUNAL GRANT A STAY?
The Tribunal now turns to the factors considered in the decision to grant a stay at the interlocutory hearing.
Prospects of success
The prospects of success or the merits of the Applicant’s case if the matter were to proceed to a substantive hearing are an important consideration for the Tribunal in deciding whether to exercise its discretion to grant a stay order in relation to the reviewable decision. However, it is not the Tribunal’s role to conduct a preliminary hearing of the substantive matter that will ultimately be ventilated at the hearing. Rather, the task in an interlocutory hearing is to evaluate whether there are cogent facts and legal grounds raised which, if established at the hearing, would lead to success at the hearing. (See Secretary, Department of Employment and Workplace Relations and Anastasiadis [2007] AATA 1065 at paragraphs [10]-[11] (per Senior Member Fice) and Dart and Director-General of Social Services (1982) 4 ALD 553 at 555 (per Davies J) and Commonwealth of Australia and Quirke [1986] AATA 57; (1986) 9 ALD 92 at 95).
Care percentage issue
The Mother asserted that she would file and serve substantial additional information in relation to her application to review the AAT1 Decision to show that she was continuing to care for Child B, because she was providing substantial and ongoing financial support to Child B. The Mother explained that while Child B had moved out of home to complete her studies, the Mother continued to pay Child B’s numerous expenses, including for food, school fees and phone bills. She claimed that she was in the process of compiling this information as well as corroborating statements for the AAT2. The Mother said she had not put this material into evidence before AAT1 due to privacy concerns for Child B.
While the Mother’s statements were not able to be tested at the interlocutory hearing, if proven at the AAT2 hearing, such evidence may well inform a different conclusion on the care percentage issue. This is particularly so in circumstances where I note AAT1 stated, relevantly, at paragraph [71] of the AAT1 Decision that “evidence does tend to indicate that child B had left home around or even before the beginning of 2020 and her mother was giving her regular financial support” (emphasis added). The AAT2 may also have the benefit of Child B’s evidence which could be highly probative.
Jurisdictional issue
As stated above, the Mother also raised in her application for review an issue about AAT1 having exceeded its jurisdiction in deciding that a “child support terminating event” occurred on 14 June 2019. Mr Taverniti, on behalf of the Registrar, put to the Tribunal that the issue of whether there was a “child support terminating event” is for the Registrar to determine. He submitted that if either parent disagreed as to the existence of a “child support terminating event”, they could object to that decision, after which the Registrar would make an objection decision, and the matter could then be independently reviewed. Instead, what occurred is that AAT1 decided for itself that there had been a “child support terminating event”. AAT1 did not, according to Mr Taverniti, have jurisdiction to in effect direct the Registrar about a “child support terminating event”. Mr Taverniti stated that the Registrar would make those legal submissions to AAT2 at the substantive hearing.
Furthermore, if AAT1 had not made the decision about a “child support terminating event”, its decision in relation to the change in care percentage (about which the Registrar adopted a neutral position) would have taken effect from 28 August 2021, being the date when the Father sought review of the care percentage in relation to child support payments for Child B. In other words, the financial implications of the AAT1 Decision in relation to a conclusion that there was a “child support terminating event” caused the Debt to be substantially larger on account of backdating the date of effect of the event to 14 June 2019, instead of backdating a new care percentage determination to 28 August 2021.
I was satisfied that the Mother’s prospects of success before AAT2 are good, in part due to the strong credence I gave to the Registrar’s submissions about the jurisdictional issue. I took into account the fact that the Registrar is neutral in this matter but is nonetheless responsible and accountable for the proper administration of the child support legislation. I also considered the AAT1 Decision reference to the Mother having given Child B “regular financial support” to be important (see paragraph [25] above), especially where the Mother claims to be able to further substantiate that fact. On the other hand, the Father did not make any meaningful submissions about his prospects of success at AAT2 except to generally question the credibility and reliability of the Mother. As stated above, it is not appropriate at an interlocutory hearing to conduct a preliminary hearing of the substantive matter, nor test the veracity of all the claims. In all the circumstances, the Mother’s prospects of success before AAT2 weighed heavily in favour of granting a stay of the AAT1 Decision.
Prejudice or hardship
Whether a person’s interests will be affected by the review will be assessed with reference to the specific statutes under which the decision being reviewed was made (Samir Pty Ltd and Aged Care Standards and Accreditation Agency [2012] AATA 333). Considering the statutory regime in this instance is the Child Support (Registration and Collection) Act 1988 (Cth) and the Assessment Act, the persons who may be affected by this application are the Mother, the Father and Child C. As stated above, the Registrar is also interested as to the proper administration of the child support legislative scheme.
The Mother would benefit from the grant of the stay order because she otherwise has a liability to repay the Debt in accordance with the AAT1 Decision (by way of set off from child support payments for Child C). Accordingly, Child C may be impacted in the absence of a stay, especially as the Mother stated she is reliant on ongoing child support payments from the Father for Child C. If a stay order were granted, the Registrar would not seek to recover the Debt during the period of operation of the stay order. On the other hand, there would be some financial hardship to the Father if the stay order were granted, as the Father would not be repaid the Debt and he still must make ongoing child support payments in relation to Child C. The Father stated he had suffered significant financial stress, anguish, and embarrassment. The Father stated that the Registrar had taken various debt recovery actions against him such as issuing several departure prohibition orders which caused strains on his marriage over the years including on one occasion having been prevented from travelling together with his wife and newborn on a long flight to meet family overseas.
In summary, there would be some hardship or prejudice to the Mother, and possibly to Child C if the stay order were not granted. Also, if a stay order were not granted and the Mother was successful before the AAT2, she may have repaid money that she was not liable to pay (albeit by way of set off) and would likely need to recover payments from the Father. This is in circumstances where debt recovery was, on the Father’s own submissions, a difficult issue for him. Conversely, if the Father is successful before the AAT2, the Debt would effectively be reinstated and the Debt would be deducted from any ongoing child support payments in relation to Child C (not yet an adult), mitigating any debt recovery issues against the Mother. On balance, when this factor is considered, both the Mother and the Father state they will suffer financial stress but the Mother is slightly more prejudiced if the Tribunal does not grant the stay order as she says she is reliant on the child support payments for Child C. Accordingly, this weighs slightly in favour of the grant of a stay order.
CONCLUSION
For the reasons outlined above, the Tribunal concluded that it should exercise the discretion to grant a stay order with respect to the AAT1 Decision.
I certify that the preceding 32 (thirty-two) paragraphs are a true copy of the reasons for the decision herein of Senior Member Lazanas
.................................[SGD]....................................
Associate
Dated: 12 August 2022
Date(s) of hearing: 25 July 2022 Applicant: In person Solicitors for the Respondent: A Taverniti, Sparke Helmore Lawyers Other Party: In person
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