Haragon and Child Support Registrar (Child support)

[2022] AATA 3367

Haragon and Child Support Registrar (Child support) [2022] AATA 3367 (14 June 2022)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2021/BC022888

APPLICANT:  Mr Haragon

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member R Anderson

DECISION DATE:  14 June 2022

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – application for extension of time - no satisfactory explanation for the delay – little merit - extension of time refused – decision under review affirmed

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. Mr Haragon and [Ms A] are the separated parents of [Child 1] and [Child 2].  [Ms A] is not a party to these proceedings.  According to the records provided, the child support assessment was registered for [Child 1] and [Child 2] in April 2003 and August 2003 respectively with what is now known as Services Australia – Child Support (Child Support). During the relevant period of contention from 3 July 2012 to 30 June 2014, Child Support were responsible for collection of child support from Mr Haragon in respect of [Child 1] and [Child 2]. 

2. On 3 July 2012, Mr Haragon lodged an estimate of his adjusted taxable income from 3 July 2012 to 30 June 2013 of $0.  Child support reviewed the estimate on 23 August 2012 and amended it to $110,621 from 11 July 2012 to 30 June 2013. On 13 September 2012, Mr Haragon revised the estimate to $104,807 for the period 13 September 2012 to 30 June 2013. On 13 December 2012, Mr Haragon revised his estimate again to $0 for the period 13 December 2012 to 30 June 2013 and again on 6 May 2013 to $13,426 for the period 6 May 2013 to 30 June 2013.  This means there were five estimates lodged in respect of the period 3 July 2012 to 30 June 2013.

3. On 30 May 2013, Mr Haragon lodged an estimate of his adjusted taxable income for 2013/14 in the amount of $13,426.  On 16 July 2013, following lodgement of Mr Haragon’s 2012/13 tax return with the Australian Taxation Office (ATO), Child Support issued an assessment notice in respect of the child support period 1 July 2014 to 30 November 2014, using Mr Haragon’s most recently lodged tax return, being 2012/13, as the basis to determine his adjusted taxable income used in the administrative assessment in the amount of $75,437.

4. On 17 July 2013, a reconciliation of Mr Haragon’s 2012/13 estimated adjusted taxable income and his actual 2012/13 income was processed.  Accordingly, an amended child support assessment was issued for the period 3 July 2012 to 30 June 2013, resulting in child support arrears in the amount of $2,740.78. 

5. On 31 August 2021, Mr Haragon lodged a request for an extension of time to lodge an objection to the decisions of 16 July 2013 and 17 July 2013 (the relevant decisions) through his representative from Child Support Help Australia.  On 29 October 2021, a delegate of Child Support decided not to grant an extension of time to Mr Haragon.  As a result, Mr Haragon lodged an application to this tribunal on 7 December 2021, seeking an independent review of the decision of 29 October 2021.

6. The hearing was held on 24 May 2022. The tribunal received oral evidence on affirmation from Mr Haragon, who participated by conference telephone. In considering this matter the tribunal took into account the oral evidence of Mr Haragon given at the hearing and the documents provided by Child Support in accordance with the Administrative Appeals Tribunal Act1975 numbered 1 to 503. At hearing Mr Haragon confirmed receipt of the Child Support documents. Tribunal records indicate that they were emailed to Mr Haragon at his request the day before the hearing, having been previously mailed to the address on record.

7. On 24 May 2022, the tribunal decided to defer making a decision to allow 14 days for Mr Haragon to provide further evidence.  This also gave Mr Haragon additional time to peruse the hearing papers and make any further comments.  No further evidence or submissions were provided by Mr Haragon so the tribunal proceeded to make a decision.  Relevant aspects of the evidence and material before the tribunal will be referred to in the tribunal’s consideration of the issues which it has to decide.

ISSUES

1. The statutory provisions relevant to this review are contained in the Child Support (Assessment) Act 1989 (the Act) and the Child Support (Registration and Collection) Act 1988 (the Registration Act).

2. Mr Haragon’s application to the tribunal indicated his concern to be related to the care of his children. A further email dated 11 March 2022 referenced a further decision going back to 2003 to accept a child support assessment application. The tribunal clarified from the outset that this review was not related to care issues or acceptance of the child support assessment and is limited to consideration of whether or not he should be granted an extension of time to object to the relevant decisions. It is noteworthy that at the date of hearing the child support assessments in respect of [Child 1] and [Child 2] had both ended.

10.In this case there is no dispute that Mr Haragon lodged his objection well outside of the 28-day timeframe (section 81 of the Registration Act). The decision of 16 July 2013 was to assess Mr Haragon’s child support liability for the period commencing 1 July 2014 on the basis of his most recently lodged tax return of 2012/13 (the administrative assessment). The decision of 17 July 2013 was to amend the child support assessment following reconciliation of Mr Haragon’s estimated and actual adjusted taxable income for the period 3 July 2012 to 30 June 2013.

CONSIDERATION

11.A parent may object in writing to a decision made by Child Support pursuant to section 80 of the Registration Act, such as to the particulars of an administrative assessment. Subsection 81(1) of the Registration Act provides that an objection must be lodged within 28 days after notice of the decision is served on the person. However, subsection 82(1) of the Registration Act relevantly provides that a person may apply for an extension of time in which to lodge an objection and that the application must state fully and in detail the grounds of the application, including the circumstances concerning, and the reasons for, the failure by the person to lodge the objection within the 28-day time period prescribed. The tribunal is satisfied that Mr Haragon lodged his objection and a request for an extension of time in writing, received by Child Support on 31 August 2021, in a manner approved by the Registrar (subsection 82(3) of the Registration Act). However, there was no statement of reasons for the failure to lodge the objection within 28 days.

12.Section 83 of the Registration Act provides that Child Support must consider and either grant or refuse the application for an extension of time. If the application is granted then the person is taken to have lodged the objection. Section 89 of the Registration Act allows the person who applied for the extension of time to apply to this tribunal for a review of that decision.

13.Mr Haragon told the tribunal that in his view he has been “railroaded” by Child Support.  He suffered a heart attack in December 2012 due to stress, returning to light duties soon after.  However, he maintains that he was eventually “let go” from his employment because of the constant harassment from Child Support. He further stated that he commenced caring for his mother who suffered from Parkinson’s disease in 2015.  He was not in receipt of carer payment.

14.Mr Haragon told the tribunal that he was unaware of his ability to object to a decision of Child Support.  However, Child Support records indicate that Mr Haragon (and his representative) spoke with an officer on 22 July 2013 and on 20 August 2013 to discuss the reconciliation decision of 17 July 2013, including his option to object. The tribunal also notes that the option to object and the importance of doing so within 28 days is set out clearly on each of the relevant assessment notices issued to Mr Haragon.  In response to a question from the tribunal, Mr Haragon stated that he doesn’t open letters from Child Support.

15.The Registration Act does not set out criteria for consideration in relation to an application for an extension of time within which to object, other than the “reasons for the failure of the person to lodge the objection”. However, the Child Support Guide, the online policy and legislation resource (“the Guide”) contains guidelines at 4.1.5 for consideration in determining whether it is reasonable or proper to grant an application for an extension of time to lodge an objection. In summary, the Guide suggests that it is ultimately a question as to whether the interests of justice favour the grant or refusal of the application in the particular circumstances. Factors to be considered in addition to the reasons for the delay are the merits of the objection, whether the person has rested on their rights and any potential prejudice to the other party or the general public. 

16.The tribunal is not bound by policy. However, in Drake and Minister for Immigration and Ethnic Affairs [1979] AATA 179, the Full Federal Court held that a tribunal should take into account relevant government policy which is not inconsistent with the provisions or objects of the legislation. In this instance, the tribunal accepts that the policy is consistent with the objects of the Act and assists in making a decision under the legislation.

17.The established cases indicate that the starting position is the prima facie rule that proceedings commenced outside a statutory period will not be entertained (Lucic v Nolan [1982] FCA 217). However, the primary concern “… is to do that which will enable justice to be done between the parties” (see Martinsen v Secretary, Department of Family & Community Services [2004] FCA 297 per Spender J). It is clear from those decisions that the statutory time limit is to be enforced unless there are acceptable reasons for departing from this prescribed timeframe. Furthermore, as noted in Hunter Valley Developments Pty Ltd v Cohen [1984] FCA 186, it must be “fair and equitable” to extend the delay. Wilcox J went on to state that one should consider and balance a range of factors in deciding whether to allow an extension of time. These factors are a guide and are not exhaustive, but generally include:

·     the reasons for the delay and whether the applicant rested on his/her rights;

·     the merits of the substantive application;

·     any prejudice to the other party including any difficulties that they will experience in providing evidence as a result of the delay;

·     wider prejudice to the general public;

·     fairness in granting an extension of time as between the applicant and other persons in a similar position; and

·     whether it is proper to grant the extension of time.

18.Given that Mr Haragon was notified clearly of his objection rights on the letters of decision of the relevant decisions and also had discussions with Child Support within 28 days of the decisions, the tribunal does not accept that he had no knowledge of his right to object.  While the tribunal accepts the oral evidence of Mr Haragon that he suffered a heart attack in December 2012, as he was able to return to work and continued to work throughout the relevant period, the tribunal does not accept that his health prevented him from lodging an objection within the required timeframe.

19.The tribunal notes again that no written reasons for the delay have been provided to Child Support or to the tribunal. In the tribunal’s view, Mr Haragon has rested on his rights since July 2013, not taking the opportunity to object despite being advised in writing and in discussions of such an option.

1. In respect of the merits of an application for review, the tribunal notes that the decision of 16 July 2016 to assess the child support payable by Mr Haragon for the period commencing 1 July 2014 on the basis of his most recently lodged tax return (2012/13) is done so in accordance with the administrative assessment formula set out in section 35 of the Act. Section 43 of the Act sets out the components of a parent’s adjusted taxable income to be used in the formula, which includes a parent’s taxable income for the last relevant year of income in relation to the child support period. Accordingly, Mr Haragon’s 2012/13 taxable income was used to calculate his child support liability in respect of the child support period commencing 1 July 2014.

21.Relevantly, section 64A of the Act provides for the reconciliation of multiple estimates of income made under section 62A of the Act with the actual adjusted taxable income, as occurred on 17 July 2013. Reconciliation of the estimates of income can be reconciled later when a parent's actual adjusted taxable income has been ascertained. If the difference between the parent's actual adjusted taxable income for the year of income and the parent's applicable year-to-date income amount is more than the parent’s estimated adjusted taxable income for the year of income amount, then the reconciliation process can result in child support arrears payable by the liable parent. This was the case in this matter when the various estimates lodged by Mr Haragon between 3 July 2012 and 6 May 2013 were reconciled with his 2012/13 taxable income, as advised by the ATO, on 17 July 2013. While an amended 2012/13 tax return was later lodged with the ATO by Mr Haragon in November 2014, legislation at the time made no allowance for use of a lower amended taxable income as a result of lodgement of an amended tax return in the circumstances of Mr Haragon.

22.There is no evidence before the tribunal to indicate that the child support assessments recorded in the relevant decisions have been done so erroneously or in conflict with the relevant legislation. Discussions with Child Support by Mr Haragon in August 2013 in respect of a change of assessment application is outside of any merits review in relation to the relevant decisions. In any event, there is no evidence of a change of assessment application being lodged by Mr Haragon.  The tribunal considers there to be little merit in a review process in regard to the relevant decisions.

23.In regard to whether any review would cause prejudice to the other parent, the tribunal notes that the child support assessments in relation to [Child 1] and [Child 2] have since ended.  According to Child Support records, arrears payable by Mr Haragon remained in excess of $33,000 on 21 August 2021.  If a favourable review were to occur, it would not result in the other parent being in a position of overpayment.  As the relevant information relates solely to Mr Haragon and the facts of the matter in regard to the adjusted taxable incomes as advised by the ATO are not in dispute, the tribunal is satisfied that a review would not create any difficulties for the other parent as she would not likely be required to produce any further evidence.

24.The Act provides for a 28-day time limit for the lodgement of objections, so that parents (and Child Support) can act with certainty as to the outcome when the objection period has elapsed. The public has an interest in reviews of decisions made by Child Support being performed in a timely fashion and in a manner that ensures all applicants are treated fairly and equally. Accordingly, the tribunal accepts that an extension of the time for objection is not to be automatically granted. However, all liable parents under the child support scheme have the right to object to decisions of the Registrar and can seek an extension of time to lodge an objection. In this case, the tribunal notes that Mr Haragon rested on his rights and did not pursue an objection in a timely manner, despite having knowledge of his ability to lodge such an objection. The tribunal is also cognisant of the particularly lengthy period of time that has expired since the relevant decisions were made and the reliance by the other parent on the assessments in meeting the day-to-day costs of the children, noting that a considerable amount of arrears still exists.

25.Based on Child Support records, it appears that Mr Haragon’s care of the children did not exceed 33% in the relevant period. Consequently, there will be no impact on any family tax benefit eligibility and likely cause no prejudice to the general public in financial terms if an objection were to be successful. 

26.After consideration of all of the factors, the tribunal is satisfied that on balance, it is not fair and proper to the parents, the general public or Child Support, nor is it in the interest of justice to grant the extension of time to Mr Haragon to lodge his objection to the relevant decisions of 16 July 2013 and 17 July 2013.

DECISION

The decision under review is affirmed.