Harrison and Department of Family and Community Services - [2002] AATA 347

DECISION AND REASONS FOR DECISION [2002] AATA 347

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N2001/825

GENERAL ADMINISTRATIVE DIVISION       )
           Re      MR PETER HARRISON
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES MRS JUDITH HARRISON

Respondents

DECISION

Tribunal MS N BELL

Date15 May 2002
PlaceSydney

Decision The decision under review is set aside and in substitution therefor the Tribunal determines that the Applicant is eligible to be paid 17 per cent of Family Tax Benefit in respect of Rebecca and the second Respondent is eligible to be paid the remaining 83 per cent.

[SGD] Ms N Bell
Member

CATCHWORDS
FAMILY TAX BENEFIT- the correct percentage of family tax benefit payable to the Applicant- interpretation of family court orders- what constitutes an FTB child- nights in care against hours of care to determine percentage entitlement- issue of rounding up or rounding down fractions of percentage points

A New Tax System (Family Assistance) Act 1999 sections 21, 22, 25 and 59

REASONS FOR DECISION

MS N BELL

This is an application by Mr Peter Harrison ("the Applicant") for review of the decision of the Social Security Appeals Tribunal ("the SSAT") on 22 May 2001 to vary the decision of a Centrelink delegate of the Secretary, Department of Family and Community Services ("the first Respondent") made on 28 October 1998. The SSAT's decision was that the Applicant was eligible to receive 16.6 per cent of Family Tax Benefit to be paid with respect to his daughter, Rebecca. Mrs Judith Harrison ("the second Respondent") was, according to the SSAT's decision, eligible to receive 83.4 per cent of Family Tax Benefit.
The first Respondent's decision had been that the Applicant was eligible to receive 16per cent of Family Tax Benefit. This decision was reviewed by an authorised review officer on 14 March 2001 and was varied slightly to 16.5per cent, but then rounded down to 16per cent (T29).
A hearing was held on the 17 April 2002, in which the Applicant represented himself and gave oral evidence to the Tribunal. The first Respondent was represented by Ms Schuster. The second Respondent represented herself and spoke to the Tribunal by telephone. The documentary evidence before the Tribunal was the documents lodged under section 37 of the Administrative Appeals Tribunal Act 1975 (Exhibit TD1) and the first Respondent's Statement of Facts and Contentions (Exhibit R1).
Background
The Applicant first claimed family allowance (as it then was) in respect of his and, the second Respondent's daughter, Rebecca. After a number of applications for review, this Tribunal ordered, pursuant to an agreement signed by the parties, that the Applicant was entitled to be paid 25 per cent of family payment (as it was later called) in respect of Rebecca. On 14 August 1998, the Family Court made further orders in relation to the care of Rebecca and on 28 October 1998 the first Respondent decided that the Applicant should be paid 16 per cent of family payment and the second Respondent should receive 84 per cent.
Following the replacement of family payment under the Social Security Act 1991 by the Family Tax Benefit, the Applicant's share of the new payment remained at 16per cent. On 20 December 2000, the Applicant requested the first Respondent to increase his share of Family Tax Benefit, based on his interpretation of the Family Court's Orders ("the Orders") (T13, pp 45). On that day, the decision was made to refuse his request and on 26 February 2001 an authorised review officer affirmed the decision to continue to pay Family Tax Benefit to the Applicant at the rate of a share of 16 per cent. The figure of 16 per cent was arrived at by the authorised review officer, by rounding down the calculated figure of 16.5 per cent.
On 21 May 2001, the SSAT varied the decision, adopting the calculations of the authorised review officer but rounding the figure up to 16.6 per cent.
Issues and legislation
The issue to be considered in this application is the correct percentage of Family Tax Benefit payable to the Applicant. The relevant legislation is sections 21, 22, 25 and 59 of A New Tax System (Family Assistance) Act 1999 ("the Act"). Those sections provide relevantly:
"When an individual is eligible for family tax benefit in normal circumstances
21.(1) An individual is eligible for family tax benefit if:
(a)the individual has at least 1 FTB child (see section 22 and later
provisions); and
(b)       the individual:
(i)        is an Australian resident; or
(ia)      is a special category visa holder residing in Australia; or
(ii)       satisfies subsection (1A); and
(c)       the individual's rate of family tax benefit, worked out under Division 1 of Part 4, is greater than nil…
22 When an individual is an FTB child of another individual
22.(1) An individual is an FTB child of another individual (the adult) in any of the cases set out in this section.
Individual aged under 18…
22.(3) The individual is an FTB child of the adult if:
(a)     the individual is aged under 18; and
(b)       a family law order or registered parenting plan is in force in relation to the individual; and
(c)       under the order or plan, the adult is someone with whom the individual is supposed to live or someone with whom the individual is supposed to have contact; and
(d)       the individual is in the adult's care; and
(e)       the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult…
22.(7) If:
(a)     the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual under subsection (2), (3), (4), (5) or (6); and
(b)       one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and
(c)       subsection 25(1), (1A) or (1B) does not require that the child be taken not to be an FTB child of that individual for any part of that period;
the child is to be taken to be an FTB child of that individual for the purposes of this section on each day in that period, whether or not the child was in that individual's care on that day.

25.(1) If:
(a)     the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual in accordance with subsection 22(2), (3), (4), (5) or (6); and
(b)       one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and
(c)       the Secretary is satisfied that the child was, or will be, in the care of that last-mentioned individual for less than 10per cent of that period;

25.(2) For the purposes of this section, a child cannot be in the care of more than one of the other individuals referred to in subsection (1), (1A) or (1B) on any particular day.

25.(3) For the purposes of this section, the Secretary must determine which of the other individuals referred to in subsection (1), (1A) or (1B) has the care of the child on any given day having regard to the living arrangements of the child.
Secretary may make determination where individual is FTB child of 2 people who are not members of the same couple
59.(1) If the Secretary is satisfied that:
(a) an individual is an FTB child of an individual (person A); and
(b) the FTB child is also an FTB child of another individual who is not person A's partner;

the Secretary may determine the percentage that is to be person A's percentage of family tax benefit for the child."

There is no dispute that the Applicant and the second Respondent both satisfy the requirements under section 22(3) of the Act. The effect of section 25 is that notwithstanding eligibility under section 22 of the Act, there is a threshold of 10 per cent of the care of the child for the relevant period (in this case the year 2001) that must be passed in order for a child to be taken to be an FBT child of a person. The first Respondent agreed that this threshold had been passed by the Applicant. This was not disputed by the second Respondent.
It remains, therefore, for the Tribunal to consider the correct percentage of Family Tax Benefit to be paid to the Applicant in respect of Rebecca, pursuant to section 59 of the Act.
There is no dispute that Orders were made by Family Court on 14 August 1998 as follows:
"4. The husband shall have contact with Rebecca Maree Harrison born 30 January 1990:

a) each alternate weekend except as herein otherwise provided from 9.00 am on Saturday to 5.00 pm on the following Sunday or on a long weekend to 5.00 pm on the following Monday with the first weekend of contact after each period of holiday contact provided for below commencing on the second Saturday after holiday contact has ended with the first weekend contact to commence on 22nd August, 1998:

b) from 5.00 pm on the second last Friday to 5.00 pm on the last Friday of each Winter and Spring school holiday period;

c) from 9.00 am on the second last Saturday of each Easter school holiday period to 9.00 am on the last Saturday of that period;

d) on each Father's Day between 9.00 am and 5.00 pm, if it falls on a day not otherwise a contact day pursuant to Order 4 (a) herein;

e) from 5.00 pm on each New Years Day to 5.00 pm seven days later;

f) on Rebecca's birthday each year from 3.00 pm to 7.00 pm;

g) commencing at Christmas, 1998 and thereafter on each alternate Christmas from 5.00 pm on Christmas Eve to 11.00 am on Christmas Day;

h) commencing at Christmas, 1999 and thereafter each alternate Christmas from 11.00am on Christmas Day to 11.00 am on Boxing Day.

5. Notwithstanding Order 4 herein if a Mothers day falls on a day which pursuant to Order 4 otherwise provides for contact between Rebecca and the husband such contact shall end at 9.00 am on that day."

There is also no dispute that the Applicant and the second Respondent generally comply with the Orders in relation to their contact with Rebecca.
Applicant's evidence and submissions
The Applicant told the Tribunal that he is currently unemployed and in receipt of newstart allowance from which he pays $10.00 each fortnight to the second respondent for support of Rebecca. He said that he does not own a business. He said that, as a general rule, Orders of the Family Court of 14 August 1998 are complied with by him and by the second Respondent.
The Applicant listed his mains concerns with the decision under review as follows:

The Orders should be interpreted as providing contact for the Applicant with Rebecca from Saturday on an alternate weekend until the Sunday some eight days later rather than the Sunday being the day after the Saturday. Similarly, in relation to long weekends, he considered that contact should take place from the Saturday until the Monday some nine days later. In this respect, he referred to clause 4(a) of the Orders and submitted that the words, on their face, suggest that it is not appropriate to look behind the words to discover the intention of the Court.
Further, the Orders should be interpreted as providing contact by the Applicant with Rebecca on Saturday and Sunday, 29 and 30 December 2001 and therefore two additional days should be taken into account in determining the Applicant's share of the payment. The Applicant stated, in cross examination, that he did not, in fact, have contact with Rebecca on those days.
Any part of a percentage point calculated as a share of 100 per cent of the payment should be rounded up to a whole percentage point.

The Applicant expressed the view that weekend contact should not follow immediately after week long holiday contact because this results in Rebecca being returned to her mother at 5.00 pm on Friday and then returned to her father at 9.00 am the next day. He noted, however, that this was the agreed effect of the Orders and that he and the second Respondent were proceeding on that basis.
Second respondent's submissions
The second Respondent also expressed the view that weekend contact should not fall immediately after school holidays.
In relation to the effect and proper interpretation of clause 4(a) of the Orders, the second Respondent submitted that the relevant words mean that contact is to last for a weekend, that is, two days, or for a long weekend when a long weekend falls, that is, three days.
The second Respondent also submitted that the duration of contact should be calculated on the basis of nights spent by Rebecca with her father.
First Respondent's submissions
Ms Schuster, for the first Respondent, submitted that there is no dispute that Rebecca is an FTB child of both the Applicant and the second Respondent and that the proportion of Family Tax benefit to be paid to each of them should be determined by reference to the Orders which set the pattern of care of Rebecca.
In relation to the Applicant's argument with respect to the interpretation of clause 4(a) of the Orders, Ms Schuster submitted that the clause means that contact on weekends should be from 9.00 am on Saturday until 5.00 pm the next day, Sunday and on long weekends it means from 9.00 am on Saturday until 5.00 pm 2 days later, that is, Monday. She submitted that the interpretation urged by the Applicant would mean contact by the Applicant with Rebecca for significantly more than alternate weekends and this was clearly not the intention of the Court.
In relation to the Applicant's submission that he should have been entitled to have contact with Rebecca on the weekend of 29 and 30 December 2001, Ms Schuster submitted that the effect of clause 4(a) of the Orders is that the first weekend following Rebecca's contact with the Applicant at Christmas, ("holiday contact"), should commence on the second Saturday after that holiday contact.
Ms Schuster submitted, in relation to the issue of rounding up or rounding down fractions of percentage points, that any fraction of a percentage point should be rounded. She submitted that to do otherwise would involve the first Respondent in a manually changing the Applicant's and second Respondent's rate of payment of benefit on each Consumer Price Index or any other changes to the benefit. This is so because the first Respondent's computer system does not allow for the recording of fractional percentages and is set up to calculate rates based on whole percentages automatically. Where percentages are in fractions of percentage points, the exercise must be done manually each time there is a change in the general rate, and this gives rise to a greater risk of error over time, and is time consuming and administratively inconvenient.
Ms Schuster stated that in this case, the first Respondent accepted that the SSAT was correct in concluding that the correct percentage share of contact time for the Applicant is 16.6 per cent and submitted that this amount should be rounded up to 17 per cent.
Consideration
The first argument raised by the Applicant was that the effect of clause 4(a) of the Orders is that contact by the Applicant with Rebecca should be from Saturday on an alternate weekend until the Sunday some eight days later rather than the Sunday being the day after the Saturday. Similarly, in relation to long weekends, he considered that contact should take place from the Saturday until the Monday some nine days later.
The plain words of the clause make it clear that the words used refer to "weekend" or "long weekend" contact. They do not refer to contact lasting for some eight or nine days. There is no basis for the interpretation urged by the Applicant.
The second argument raised by the Applicant was that the Orders should be interpreted as providing for contact by the Applicant with Rebecca on Saturday and Sunday, 29 and 30 December 2001 and therefore two additional days should be taken into account in determining the Applicant's share of the payment.
This goes again to the proper interpretation of clause 4(a) of the Orders which states, after describing the duration of weekend or long weekend contact, "with the first weekend of contact after each period of holiday contact provided for below commencing on the second Saturday after holiday contact has ended …". Pursuant to clauses 4(g) and (h) of the Orders, there is to be contact with the Applicant either:
"from 5.00 pm on Christmas Eve until 11.00 am on Christmas Day or from 11.00 am on Christmas Day until 11.00 am on Boxing Day".
The Applicant's interpretation requires the term "holiday" to exclude the Christmas contact described above. There is no such express or implied exclusion in the Orders.
Before turning to the Applicant's final argument, concerning the rounding of fractions of percentage points, it is appropriate to consider the application of the relevant law to the circumstances of this case.
There is no dispute that Rebecca is an "FTB child" of both the Applicant and the second Respondent, who are no longer partners. The issue that remains to be considered by the Tribunal is the correct percentage share of Family Tax Benefit to be paid to the Applicant pursuant to section 59(1) of the Act. That provision is silent on the method to be used in making that calculation.
It is agreed between the parties, however, that, notwithstanding the Applicant's views as to the proper interpretation of the Orders, they are generally being complied with by the Applicant and the second Respondent and accurately reflect the pattern of care of Rebecca.
The second Respondent submitted that the proportion of Rebecca's contact with the Applicant should be calculated by reference to the number of nights she spends with him. The Applicant, on the other hand, submitted that by counting the number of hours spent with him, a more accurate measurement would be obtained.
The following is an extract from the first Respondent's "Guide to the Family Assistance Act "(T40, pp 131)
" Nights in care vs hours of care
Generally a pattern of care is based on the number of nights in an assessment period where an individual has the overnight care of an FTB child. A person with the overnight care of a child is regarded as having had care of the child for that day.
Explanation: One night in care equals one day in care.
Example: Alison and Neil share the care of their 2 children according to a parenting plan. Their current assessment period is from 30 April 2001 to 30 June 2001, which is 62 nights. The children stay with Neil every second weekend starting from Friday 4 May, and the rest of the time they live with Alison. The pattern of care is worked out as follows:
·         Neil provides 10 weekend nights of care = 10 days in care, and
·         Alison provides 52 nights of care made up of 44 week nights plus 8
             weekend nights = 52 days in care
There may be some occasions where only counting the nights in care does not accurately reflect the caring arrangements for the child. In such cases, at the request of a carer, the actual number of hours of care may be calculated for each carer in determining the pattern of care and then converted into days in care.
Example: William and Julia are divorced. They have 3 children, Sam attends primary school, and Pat and Louise are pre-schoolers. William and Julia do not have a family law order or parenting plan, and they are unsure of their respective percentages of care.
William works full-time during the week, and Julia works part-time on Sundays. William takes the children to Julia every morning at 8am on his way to work. Julia is responsible for the children during the day, and participates in parental activities at Sam's school. William picks the children up on his way home at 6pm from Monday to Thursday. The children spend Friday night with Julia and she leaves them with William on her way to work at 8am on Sunday. Twice a year during school holidays the children spend a full week with William. Once during the end of year school holidays they spend a full 4 weeks with Julia. The assessment period is the full income year from 1 July to 30 June.
The pattern of care is worked out as follows:
·         William provides 168.33 days of care (46 x 7 days x 80/168 hours per week plus 15 full days), and
·         Julia provides 196.67 days of care (46 x 7 days x 88/168 hours per week plus 28 full days)."

The Tribunal considers that, given the Orders provide for a large number of days on which almost all daylight hours are hours of contact with the Applicant, and do not extend into the night, for example the Sunday of a contact weekend or the Monday of a contact long weekend, it is fair and equitable to measure the time spent by Rebecca with the Applicant by hours.
Precise calculations of the percentage entitlement of the Applicant and second Respondent, on the basis of the hours of contact provided for by the Orders, were undertaken by the first Respondent (T28). In summary, those calculations were as follows:
JANUARY 2001 1 – 8: SUMMER HOLIDAYS 20 – 21: WEEKEND (W/E) 30: REBECCA'S BIRTHDAY 168 HOURS 32 4      204 HOURS
FEBRUARY 2001 3 – 4: W/E 17 – 18: W/E   32 32 64 HOURS
MARCH 2001 3 – 4: W/E 17 – 18: W/E 31 –1/4: W/E          32 32 32          96 HOURS
APRIL 2001 14 – 16: W/E 21 – 28: EASTER HOLIDAYS    56 168           224 HOURS
MAY 2001 12: W/E (Mothers Day falls on 13/5) 26 – 27: W/E         24 32 56 HOURS
JUNE 2001 9 – 11: LONG W/E 23 – 24: W/E           56 32 88 HOURS
JULY 2001 7 – 8: W/E 13 – 20: WINTER HOLIDAYS 28 – 29: W/E 32 168 32        232 HOURS
AUGUST 2001 11 – 12: W/E 25 – 26: W/E   32 32 64 HOURS
SEPTEMBER 2001 2: FATHERS DAY 8 – 9: W/E 22 – 23: W/E     8 32 32           72 HOURS
OCTOBER 2001 5 – 12: SPRING HOLIDAYS 20 – 21:W/E 168 32           200 HOURS
NOVEMBER 2001 3 – 4: W/E 17 – 19: W/E 32 32 64 HOURS
DECEMBER 2001 1 – 2: W/E 15 – 16: W/E 25 – 26: CHRISTMAS DAY/BOXING DAY    32 32 24          88 HOURS

The above calculations yielded a total number of contact hours for the Applicant of 1452 out of total hours in the year of 8760. The first Respondent, on this basis, calculated a percentage contact of 16.5 per cent for the Applicant and then rounded that down to 16 per cent.
Document T28 also indicates that the calculations are based on the following information:
EASTER HOLIDAYS:          Friday 13 April – Sunday 29 April 2001
WINTER HOLIDAYS:           Saturday 7 July – Sunday 22 July 2001
SPRING HOLIDAYS:           Saturday 29 September – Sunday 14 October 2001
REBECCA'S BIRTHDAY:     30 January
MOTHER'S DAY:                 13 May 2001
PUBLIC HOLIDAY:              11 June 2001
FATHERS DAY:                   2 September 2001
That information was drawn from a calendar of Australian and New Zealand Holidays that also appears at document T28.
The Tribunal accepts the above calculations as an accurate measurement of the proportion of time for which the Applicant has the care of Rebecca. However, the Tribunal notes that the precise percentage expression of the proportion of 1,452 hours out of a total of 8,760 hours is 16.57 per cent.
The Tribunal also accepts as reasonable and in the interests of efficient administration the first Respondent's submission that the determination under section 59(1) of the Act should be made in whole percentage points. This must involve either the rounding up or rounding down of a fractional figure. It is customary for fractions above 0.5 of a whole point to be rounded up and for fractions less than 0.5 of a whole point to be rounded down. The Tribunal considers that this is the appropriate method to be adopted here. On this basis, the Applicant's entitlement is a percentage share of 17 per cent of Family Tax Benefit.
The Tribunal notes that the difference between the Tribunal's determination and the decision under review is 0.4 per cent and that, on present rates of Family Tax Benefit, this amounts to some 38 cents per fortnight. In the course of the hearing the Applicant indicated that he would be prepared to accept a 17 per cent share of the payment. The Tribunal also notes the level of discord between the Applicant and second Respondent, and the use by the Applicant of the review process established by the Administrative Appeals Tribunal Act 1975 to secure such a negligible increase in payment.
Determination
The decision under review is set aside and in substitution therefor the Tribunal determines that the Applicant is eligible to be paid 17 per cent of Family Tax Benefit in respect of Rebecca and the second Respondent is eligible to be paid the remaining 83 per cent.

I certify that the 41 preceding paragraphs are a true copy of the reasons for the decision herein of MS N BELL
Signed:         S. Swamy           .....................................................................................
  Associate
Date of Hearing     17 April 2002
Date of Decision  15 May 2002
Counsel for the Applicant  Self represented
Advocate for the First Respondent  Ms Schuster
Representative for the Second Respondent      Self represented