GL v Child Support Registrar

[2010] HCATrans 102

[2010] HCATrans 102

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S302 of 2009

B e t w e e n -

GL

Applicant

and

CHILD SUPPORT REGISTRAR

Respondent

Application for special leave to appeal

HEYDON J
KIEFEL J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 23 APRIL 2010, AT 12.02 PM

Copyright in the High Court of Australia

MR G. POTKONYAK:   If the Court pleases, I appear for the applicant father.  (Morgan Ardino & Co)

MR A. MARKUS:   If the Court pleases, I appear for the respondent.  (Australian Government Solicitor)

MR POTKONYAK:   Your Honours, this is an application for special leave by the father of the decision of the Full Court of the Family Court by the single judge, Justice O’Ryan.

HEYDON J:   I think you can take it we have read the contents of the application book and know the background to the matter.

MR POTKONYAK:   Yes.  All I would like to add, your Honours, to what is already in the argument that has been filed in this Court is regarding the merits and the public importance of the matters that the applicant is raising.  The main issue here would be a constitutional issue regarding the provisions of the Child Support (Assessment) Act 1989 which deals with the capacity to earn.

In the bundle that I have filed here on page 38 – beginning on page 38 is section 6A which deals with the “Departure from administrative assessment of the child support”.  The earlier parts of the Assessment Act deal with the administrative assessment which there is a formula where input to the formula is, for instance, number of children, how many nights a child spends with the mother or the father, with whomever, and most importantly it shows – the input to that formula is the taxable income of both parents so the formula works nicely.  There is no argument about that.  All these inputs are fed into the formula and the formula produces the amount of the child support that the payer is to due to the payee.

However, when you look at section 6A which – I am sorry, Part 6A, section 98C which begins at page 38, about line 24 – I will read only abbreviated with this which said:

Matters as to which Registrar must be satisfied before making determination

(1)      Subject to this Part, if:

(a)an application is made to the Registrar under section 98B –

which is application for the departure from the administrative assessment -

and

(b)     the Registrar is satisfied:

(i)that one, or more than one, of the grounds for departure referred to in subsection (2) exists . . . 

the Registrar may make the determination -

which means that any one of the grounds is satisfied that the departure can be made.  One of the inputs, as I mentioned before, is the taxable income of the parties. 

Now, the registrar can make or may make assessment of an earning capacity which is then substituted for the taxable income of the parent so the formula is fed instead with a factual finding which is produced normally comes from the Tax Commissioner where the parties are assessed for their income.  That income which is admissible into evidence under sections 155 and 155A of the Evidence Act is now replaced by the assessment by the registrar of earning capacity and that assessment of earning capacity there is no document produced by any government agency similar to the one that is produced by the Tax Commissioner which would show and be admissible into evidence as being a fact on which the registrar can rely.  When we go to section 98C(2):

For the purposes of subparagraph (1)(b)(i) –

which I just mentioned there – it is on page 39 at the top -

(a)the grounds for departure from the provisions of this Act relating to administrative assessment of child support in relation to the child are the same as the grounds for departure set out in subsection 117(2) –

That is the subsection that belongs to Part 7 of the Act which deals with the “Court review of certain decisions” which means this subsection (2) actually gives power to the decision of the registrar, the same power that is enjoyed by a court under Part 7 of the Act.  Now, when we go further to section 98C(3) which begins at page 39, it is said:

Subsections 117(4) to (9) (inclusive) apply to the Registrar in the exercise of his or her powers under this Division as if:

(a)any reference in those subsections to the court were a reference to the Registrar; and

(b)any reference to an order were a reference to a determination -

which practically said the Act is giving power to the registrar, the same power to the registrar’s decision to have as a decision of a court of law.  That would be fine if there is an administrative formula as it was in the original assessment but there is no formula given in the departure from administrative assessment.  No formula is given to how to assess capacity to earn by a party.  There is no guideline whatsoever.  There is not even a description of what does it mean.  It is given, in my respectful submission, an arbitrary power to the registrar to change the input to the administrative formula which will change the output without any due process of law, without any disregard – with disregard to the rules of evidence.

Even if we go to page 40, starting about line 7, it is section 98H which is “Procedure for dealing with application”.  Now, we are dealing only – I am addressing here only the capacity to earn.  There are other provisions as well.  I am addressing only capacity to earn because this is the one that is relevant in this particular case.  It says:

In making a decision under this Division in relation to an application, the Registrar . . . 

(b)may, but is not required to, conduct any inquiry or investigation into the matter.

Further, in subsection (4):

Any hearing before the Registrar, and any inquiry or investigation carried out –

that is, if the registrar decides to do so –

by the Registrar, is to be carried out as the Registrar thinks fit and the Registrar is not bound by any rules of evidence -

which practically, your Honours, means that a registrar can make an arbitrary decision to the input into the formula and then of course the formula will produce a result which will not be a result according to law because the so‑called evidence that can admitted or may be admitted is hearsay.  It could be allegations. 

It could be, as was in this case, an opinion of somebody where - your Honours, I have quoted in the submission the quote from the decision – from the actual decision for departure but unfortunately that has not been included in any of the books.  So if your Honours would be minded I could put this addendum where I would like to refer your Honours to page 3 which is a full decision – description of the – under title under “Reason 8” of that decision which will be quite clear that it was an arbitrary decision by the registrar.  It is page 3 and there is a subtitle which is called “Reason 8”.

HEYDON J:   We have read that.

MR POTKONYAK:   The assessment concludes with “I am therefore unable to avoid the fact” - the Registrar called this the fact – “that [Mr L] appears to have the capacity to earn significant income whether he does so in fact or not”.  The Registrar calls that the fact and the fact is that Mr L appears to have a capacity to earn.  There is nothing else.  He may appear to have but it is not evidence.  It would not be accepted as evidence before a court of law.  If you go to section 117 which begins on page 58 and goes on through page 60 and so on.  If the matter would come before a court and the applicant for the departure of the administrative assessment would come to the court and say, “Your Honour, it appears that the payer has much greater capacity to earn than his tax return shows” would that judge accept that into evidence?  In my submission, your Honours, he would not because there is no evidence.  A judge would certainly ask for evidence for that.

The only evidence that would be acceptable without further inquiry on this challenge would be evidence according to the rules of evidence, section 155 and 155A which would be a statement by a government department such as the Tax Office that so‑and‑so has such and such earning capacity.  I am not aware, your Honours, of any department or anyone, actually, having any record of any authority which would determine a person’s earning capacity.  That would have to be done by the proper judicial inquiry in a court of law where the evidence would be accepted according to rules of evidence.

It cannot be made on some hearsay or some allegations or insinuations or whatever.  In this particular case that was exactly what happened.  The wife said and told the registrar it appears that Mr L has a much greater earning capacity than he shows and it was accepted as a fact and the assessment was made at the time Mr L was, I think, over 64.  In a proper court of law that would have been taken into account even though his qualifications were great, would be taken into account that by the end – by the time he turned 65 most likely he would not have found any job anyway but the registrar just ignored all that and said, “Look, I don’t care whether he earns or not, I think it appears that he can earn more money” and that was the order.

I believe such an order in that case, number one, it is contrary to Chapter III of the Constitution not than an administrative person is making a decision which is of a judicial nature of which there is a case, for instance, where we have administrative assessment but decision that has actually more power than the judicial decision because it is an arbitrary decision that gets a power of a decision of a proper court of law.

Such a decision not only is contrary to Chapter III but is contrary to section 51(xxxi) of the Constitution where “acquisition of property on just terms” just must mean according to law. It may have all other attributes but if it is not according to law that decision is contrary to the Constitution. Therefore this decision is not, in my submission, a decision according to law, therefore any decision of that nature that takes money from one person and gives it to someone else is acquisition of property other than on just terms.

Your Honours, I believe this was - the most important issue in this matter was the constitutional issue.  However, unfortunately, some other issues arose in the course of the proceedings where a private communication took place between a party and a judicial officer.  Your Honour, I do not have much to add to what is already written in the application book in pages 98 to 99 of the submissions except to draw your Honours’ attention just to a few matters.

In the judgment of Justice O’Ryan which is subject to this application for special leave to appeal his Honour refers in only page 45 of the application book in paragraphs of his Honour’s judgment, 31 to 34, he refers to two emails that had been tendered in the course of proceedings.  His Honour, however, does not refer to the third email, or, rather, it was the first one in the sequence email which I have reproduced on page 83 of the application book.  It has been photocopied on page 88 where the format was a little bit scrambled.  That is why I have reproduced it on page 83.

If you go through the email one thing that we find it is from “Rick Maurice”.  It was sent on 2 December 2008 at 11.57.  It was sent to [email protected] and copied to “Felicio Law Firm.  The subject matter of the email is “[L]” which is the name of the applicant in this application for a special leave.  What it said – it said, “Please refer to attachment.”  The email shows that there was an attachment which was called [L.G.01] in the pdf format which again means the attachment refers to Mr L who is the applicant in this application today and he was back then an appellant in that court. 

There is no Cc to anyone else.  There is not even to the first respondent.  The Child Support Registrar has not received a copy of that email.  The email – of course, and Mr L has not received a copy of the email.  The email refers to the – that the attachment – it says that attachment “has been sent to the AGS”.  However, the Australian Government Solicitor tendered these three copies of these three emails in the proceedings but has not tendered the attachment.

So, number one, we do not know whether the Australian Government Solicitor received the attachment.  Number two, we do not know what was in the attachment.  In my submission, we even do not need to know what is in the attachment.  All we need to know is that a private communication took place between a party to the proceedings and the judicial officer who was hearing that proceeding through ‑ ‑ ‑

KIEFEL J:   More accurately, the associate to the ‑ ‑ ‑

MR POTKONYAK:   The associate.  That is what I meant, so through the associate.

KIEFEL J:   Who was organising – talking about adjournments.  That is the topic being discussed.

MR POTKONYAK:  What does it say?  If we go to the judgment of his Honour Chief Justice Gibbs in the matter called Re JRL; Ex parte CJL 161 CLR 342. The judgment of his Honour Chief Justice Gibbs has been reproduced in the bundle starting at page 21. I would just read a short extract from page 21, lines 20 to 21, where his Honour refers to the discussion from other case about the seriousness or otherwise of the private communication between a judicial officer and a party and he said:

For if something is done which affords a reasonable basis for such suspicion –

a suspicion that some communication has taken place, a private communication –

confidence in the impartiality of the judicial officer is undermined.”

Then his Honour goes on to quote and it is said that that represents “a serious contempt of court”.  If his Honour thinks that it constitutes “serious contempt of court”, your Honour, in my submission, I believe that that matter had to be dealt at some level with authority so that professionals and ‑ ‑ ‑

HEYDON J:   Mr Potkonyak, it would appear that your time is up.  The red light is on.

MR POTKONYAK:   I am sorry, your Honour?

HEYDON J:   Your time is up.

MR POTKONYAK:   Thank you, your Honour.

HEYDON J:   We need not trouble you, Mr Markus.

The background to this application is that in the year 2000 the Child Support Registrar increased the applicant’s child support liability under Part 6A of the Child Support (Assessment) Act 1989 (Cth). That decision has been challenged again before the Registrar, before the Social Security Appeals Tribunal, before the Federal Magistrates Court and most recently before the Family Court where it was dismissed by Justice O’Ryan. In particular, he refused to grant an extension of time within which the applicant could file a draft index, which he had failed to file, and which led to his application being deemed to have been abandoned.

The explanation offered for the delay was that the applicant was waiting to see whether the mother of the child had filed a claim for legal costs.  That was an aspect of the controversies between the parties which related to an allegation of a private communication between the wife and the Federal Magistrates Court.  Justice O’Ryan rejected that explanation and held that the applicant never intended to file the draft index in time.  Further, he found that the proposed appeal was futile.  He rejected the conspiracy allegation and he also decided that a challenge to the constitutional validity of the legislation on which the Registrar’s orders rested had to be rejected.  The basis of that challenge was repeated and amplified today.

There are insufficient prospects that if leave were granted the Court would conclude that Justice O’Ryan erred in any respect.  Accordingly, the application is dismissed with costs.

AT 12.26 PM THE MATTER WAS CONCLUDED