Harrolds and Child Support Registrar (Child support)

[2019] AATA 566

Harrolds and Child Support Registrar (Child support) [2019] AATA 566 (6 March 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/SC014965

APPLICANT:  Mr Harrolds

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member H Schuster

DECISION DATE:  6 March 2019

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that:

1. Mr Harrolds’ objection, to the care percentage decision in relation to [Child 1] made on 27 March 2018, is allowed;

2. There was a change of care on 9 December 2017 in relation to [Child 1] as a result of which Mr Harrolds’ care percentage for the child increased to 42%, while Ms Harrolds’ care percentage reduced to 58%.

3. The care percentage decision in relation to [Child 1] takes effect on 9 December 2017.

CATCHWORDS

CHILD SUPPORT – percentage of care – whether there was a change to the likely pattern of care – existing percentage of care determinations revoked and new determinations made - decision under review set aside and substituted - date of effect - whether there were special circumstances that prevented the objection being lodged in time - special circumstances exist - decision under review set aside and substituted

CHILD SUPPORT – date of effect of the tribunal’s decision – whether there were special circumstances that prevented the application for review being lodged in time - special circumstances exist - tribunal decides to make a determination under subsection 95N(2)

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 Harrolds has sought review of a decision made by the Department of Human Services (Child Support) (the Department) on 5 July 2018 to disallow an objection in relation to a change of care decision in respect of [Child 1] for the purpose of a child support assessment.

2. Mr Harrolds and Ms Harrolds are the parents of [Child 2] (born 2001), [Child 3] (born 2003) and [Child 1] (born 2009). There is a child support assessment in place in relation to the children, under which Mr Harrolds is required to pay child support to Ms Harrolds.

3. From 1 August 2013 the Child Support Registrar made an assessment based on the fact that Mr Harrolds had 20% care and Ms Harrolds had 80% care of all three children.

4. On 1 December 2017 Mr Harrolds provided a form to Centrelink on which he advised he and Ms Harrolds were separated, one of them would move to a different address on 9 December 2017 and that he would have 50% care of each of the three children from that date. He noted that he and Ms Harrolds were “in the process of discussing the future”. Ms Harrolds had not signed the form.

5. On 7 February 2018 an officer of the Department contacted Mr Harrolds in relation to the information he provided to Centrelink. Mr Harrolds advised that Ms Harrolds left the marital home, that the care of [Child 2] and [Child 3] was ad hoc but that he had 50% care of [Child 1]. 

6. On 12 February 2018 Mr Harrolds was asked to provide evidence regarding the change of care. Ms Harrolds was also asked to comment.

7. Mr Harrolds did not provide any evidence to the Child Support Registrar by 27 March 2018 and a decision was made that the care percentage in relation to [Child 1] could not be changed. Notices were sent to both Mr and Ms Harrolds to that effect.

8. On 28 March 2018 Mr Harrolds spoke to an officer about the decision to reject his application for a change in care and told the officer he would pursue it. The objection timeframes were discussed with him.

9. On 7 May 2018 Mr Harrolds contacted the Child Support Registrar and was advised he was required to lodge an objection against the decision made on 27 March 2018.  A notice acknowledging the objection was sent to both parties on 10 May 2018.

10. On 29 June 2018 Mr Harrolds provided evidence in the form of photos of a calendar for the months January to June 2018 on which he had marked the dates on which [Child 1] was staying with him. Ms Harrolds provided no evidence and did not respond to any letters or calls from the Department.

11. On 5 July 2018 the objections officer determined that Mr Harrolds’ objection should be disallowed as his evidence did not demonstrate that Mr Harrolds had a pattern of care of 50% care in relation to [Child 1] from December 2017. The objections officer noted that a change in the pattern of care may have occurred from 2018. It was noted that Mr Harrolds could ask for a new care determination to commence from May 2018, based on his request made at that time.

12. On 5 September 2018 Mr Harrolds spoke to an officer of the Child Support Registrar about his request for a change of care in relation to [Child 1]. He was advised to seek review of the objection decision if he disagreed with it.

13. Mr Harrolds applied to the Administrative Appeals Tribunal (the Tribunal) for review on 5 September 2018.

14. The Tribunal was provided documents by the Child Support Registrar comprising 81 pages. In addition, Mr Harrolds provided copies of a calendar from May 2018 to October 2018; these were numbered A1 to A8.

15. Ms Harrolds was invited to apply to be made a party to the matter; however, she did not make such an application. Thus, the review proceeded without her.

16. The hearing was conducted on 1 and 20 February 2019. The Tribunal spoke to Mr Harrolds by telephone.

ISSUES

17.  The law that applies to this application is found in the Child Support (Assessment) Act 1989 (the Act) and the Child Support (Registration and Collection) Act 1988 (the Registration and Collection Act).

1. The issues which arise in this case are:

   ·       Was there a change of care in relation to [Child 1] on 9 December 2017, and if so,

   ·       What percentage of care did Mr and Ms Harrolds have in relation to [Child 1] from 9 December 2017, and

   ·       If the care percentage is varied, from what date can it take effect?

CONSIDERATION

Operation of the law

19. The Child Support Registrar makes child support assessments using the statutory formula found in Part 5 of the Act. Part of the formula, dealing with the costs of the children, requires the Child Support Registrar to determine the percentage of care for each child in relation to each parent.

20.  The percentage of care must be worked by reference to the pattern of care and the actual care provided by each parent, generally determined by the nights spent by the child in each parent’s care over a care period.

21. The percentage of care is then used to work out the cost percentage for a child under section 55C of the Act. Thus, a care percentage of 35% results in a cost percentage of 25%, while a care percentage of 40% results in a cost percentage of 35%.

22. The Department makes determinations of each parent’s percentage of care in accordance with sections 49 to 54L of the Act. These provisions require the Department to make determinations of each parent’s percentage of care when first making a child support assessment and for those determinations to be revoked and remade in specified circumstances.

23. Subsection 54F(1) of the Act provides that the Department must revoke a percentage of care determination if the Child Support Registrar is notified or becomes aware that the actual care in relation to the child does not correspond to the existing percentage, but only if the change to the care percentage would also change the cost percentage.

Was there a change to the pattern of care on 9 December 2017?

1. In order to determine that a new percentage of care should be struck in relation to [Child 1] from 9 December 2017, the Tribunal must be satisfied either that there was a new pattern of care in relation to the child or that the actual care does not reflect the care assessed by the Child Support Registrar.

2. The Child Support Registrar’s records show that a child support assessment in relation to the children has been in force since at least 2013 according to which Mr Harrolds had 20% care of all three children.

3. Mr Harrolds told the Tribunal that he and Ms Harrolds were married and separated in 2013 for about two months before reconciling. They had lived together as a couple in the same residence until December 2017. Mr Harrolds said that they separated because he discovered Ms Harrolds had claimed to be separated for the purpose of receiving Centrelink payments and for tax purposes. He said that he was unaware until after the separation that a child support assessment was still in force in relation to the children and that child support letters had been sent to him in the past which his wife had intercepted.

4. On 9 December 2017 Ms Harrolds moved out of the joint home with their three children into other accommodation in [Town 1]. According to Mr Harrolds, at the time of separation they had a conversation in which Ms Harrolds assured him they would split both the property and the care of the children on a 50/50 basis. He said his older son and daughter only stayed with him from time to time; he expected to have care of [Child 1].

5. The Tribunal accepted Mr Harrolds’ evidence that there was separation on 9 December 2017 and that thereafter both Mr Harrolds and Ms Harrolds had care of [Child 1] on some days in the period.

6. There were no written parenting agreements in relation to the children, or court orders in force, at the relevant time, and there is currently no court proceeding in progress. The Tribunal must determine the care arrangement based on the actual care likely to occur from the time at which the change in care took place. In this case, that time is 9 December 2017. The Tribunal can take into account the actual care occurring after that time to establish whether a change in care has occurred and what that pattern of care may be, though subsequent changes in the pattern may give rise to a right of one or the other party to notify the Department of a new care arrangement.

7. Mr Harrolds told the Tribunal that he initially had [Child 1] for half the time in both January and February 2018. However, in March and April 2018 Ms Harrolds took the children out of school to travel to [City 1] over several occasions, over his objections. It was for that reason he did not have care of [Child 1] as frequently those two months. In subsequent months he did have [Child 1] for half the time, which continued until October 2018 when Ms Harrolds moved to [City 1] with the children. He had [Child 1] for about four weeks from 28 December 2018 to 24 January 2019.

8. Ms Harrolds has not provided any evidence or spoken to any officer about the care percentage for [Child 1].

9. Mr Harrolds provided copies of a calendar on which he made notations on each date on which [Child 1] was in his care, as well as noting other information, such as his shift times and other events. The objections officer remarked Mr Harrolds had only provided evidence from March 2018. However, it appears the officer overlooked the calendar entries for January and February 2018 which are depicted on page 63 of the documents, and which had been provided to the Department on 29 June 2018. Thus, the Tribunal finds that the decision of the Department was based on an error in relation to the available evidence.  

10. In preparation for the hearing Mr Harrolds also provided his records from July 2018 to October 2018.

11. The Tribunal reviewed Mr Harrolds’ calendar from January 2018 to October 2018 and was satisfied that it was a genuine record of times Mr Harrolds had care of [Child 1] and is the best available evidence of the pattern of care since January 2018.  

12. Although no records were available in relation to December 2017, the Tribunal found it unremarkable that Mr Harrolds did not keep records for the first three weeks following separation. The Tribunal also accepted Mr Harrolds’ evidence that as at 9 December 2017 he operated on the basis that he and Ms Harrolds would share care equally. While this turned out not to be the case for the older children, the Tribunal accepts that Mr Harrolds’ care of [Child 1] was significantly higher than assessed by the Department.

13. Based on the available evidence the Tribunal is satisfied that there was a change in care in relation to [Child 1] on 9 December 2017, and that there was a pattern of care thereafter under which Mr Harrolds had more than 20% care of [Child 1]. 

14. Mr Harrolds said, and the Tribunal accepts, that Ms Harrolds told him that they would share 50% care of the children. However, as Mr Harrolds readily conceded, the actual care for [Child 1] varied and for some periods was less than 50%.

15. However, the Tribunal finds that the original understanding between the parties was that Mr Harrolds was to have half the care of [Child 1]. The Tribunal also finds that the parties only recently moved into separate accommodation, the care arrangement was informal and new and thus some variation is generally expected while the parties accommodate each other’s and the children’s schedules.

16. The Tribunal found that Mr Harrolds had care of [Child 1] from January 2018 to October 2018 for the following days:

    January 2018: 16/31 days

    February 2018: 10/28 days

    March 2018: 8/31 days

    April 2018: 9/30 days

    May 2018: 15/31 days

    June 2018: 13/30 days

    July 2018: 13/31 days

    August 2018: 15/31 days

    September 2018: 15/30 days

    October 2018: 15/31 days

    Total: 192/304 days or 42.4%, rounded down to 42%.

17. The Tribunal did not find that an apparent reduction of care to less than half the month in February to April 2018 was remarkable, given Mr Harrolds’ account that the separation was recent and some variation at the outset would not be unexpected.

18. The Tribunal notes that Mr Harrolds stated that in October 2018 Ms Harrolds moved to [State 1] with the children and although he still has care of [Child 1], the pattern has changed. Given the change of the pattern of care, it was not appropriate to consider the care post October 2018 in determining the percentage of care from 9 December 2017. The Tribunal notes that subsequent care percentage decisions have been made which are outside the scope of this review.

19. Based on the available evidence, the Tribunal finds that there was a change of care in relation to [Child 1] which resulted in Mr Harrolds having a pattern of care and a care percentage of 42% from 9 December 2017, while Ms Harrolds had 58% care.

20. The Tribunal is satisfied that the previous care percentages must be revoked under section 54F of the Act.

Date of effect of the care decision

1. The Tribunal notes that the original care decision was made on 27 March 2018. Mr Harrolds spoke to an officer the following day and advised he wished to seek a review of the decision. The officer noted that “[Mr Harrolds] advised he would pursue this, however right now he did not have the time to do it. Explained the objection timeframes to ensure should the objection go in his favour the decision is applied from the original date of event”.

2. Mr Harrolds then sought review on 7 May 2018, outside the required time frame. At the time of the objection Mr Harrolds asked for an extension of time to make the objection for a special reason. He told the objections officer that he not yet seen the letter advising him of the objection decision, in part because he was not very adept at using computers and in part because Ms Harrolds had taken the computer equipment with her. The objections officer advised him that the letter was issued electronically and that the system showed he had not yet accessed it.

3. Section 87AA of the Registration and Collection Act states that if a person lodges a late objection to a care percentage decision, and the objection is allowed, the decision will take effect on the date of the lodgement of the objection. If the Registrar is satisfied that there are special circumstances which prevented the person from lodging the objection within the required period, the Registrar can treat the objection as if it was made within the required time. That is, if a person is allowed an extension of time to object, the decision can take effect before the date on which the objection was made.

4. The Tribunal finds that the decision of 27 March 2018 was served on Mr Harrolds electronically but accepts he did not open the letter. The objection was made 13 days after time to object expired.

5. The Tribunal considered, however, that there were special circumstances which prevented Mr Harrolds from making an objection, namely that he had not been technically able to access his electronic correspondence and had not seen the decision.

6. The objection decision in relation to Mr Harrolds was made on 5 July 2018. He was sent a notice of the decision on the same day. In addition, the objections officer spoke to him about the objection decision and discussed the time frame for making an application to the Tribunal. Further, the notice of decision sent to Mr Harrolds noted that he was required to lodge any application for review within 28 days of receipt of the decision.

7. Mr Harrolds did not make his application to the Tribunal until 5 September 2018, two months later.

8. As Mr Harrolds applied more than 28 days after being notified of the objection decision, under section 95N of the Registration and Collection Act, the date of effect of the tribunal’s decision is the day he applied for review unless the tribunal extends the time period because of special circumstances that prevented him from making an earlier application.

9. The objection decision was made on 5 July 2018 and was despatched the same day. Allowing nine business days for posting, Mr Harrolds had 28 days from 18 July 2018 until 5 September 2018 to apply to the tribunal. His application was made about three weeks out of time.

10. The Tribunal considered whether the decision should take effect before September 2018 due to special circumstances.

11. Mr Harrolds stated that, even now, his understanding of how child support review processes work is very limited and he was not aware of what exactly he was required to do to challenge the decision. He wanted more information about the decision and he recalled speaking to many people about his situation.

12. Initially he understood that his application had been refused on the basis that his care percentage was not exactly 50%. He later found that although he initially asked for 50% care, it was open to the Child Support Registrar to determine a percentage which was lower than the percentage he had sought. He did not come to understand this until a discussion he had with a departmental officer in July 2018. Once he found out that he could ask the Tribunal to make a determination other than 50% care he lodged his review right away.

13. There were other personal factors which affected his ability to focus on the child support assessment: his mother became very ill and he spent time caring for her before she passed away in October 2018. This, combined with his shift work, made it difficult to deal with administrative matters. He was also preoccupied with the care issues in relation to the children, including the fact that his son was not attending school regularly and he was concerned about Ms Harrolds reducing the time he was spending with [Child 1] if a review was undertaken.

14. The Tribunal considered whether there were considerations of fairness in relation to others, or Ms Harrolds, which would make it inappropriate to allow him an extension to object. The Tribunal considered whether Ms Harrolds may be overpaid child support and notes that any overpayment is likely to be offset against the future child support liability of Mr Harrolds.

15. Ms Harrolds has had a number of opportunities to respond to Mr Harrolds’ request for changes to the care percentage and despite having ample opportunity to do so, has not sought to provide any response or information. Thus insofar as she may have expressed any concerns about a reduction in her care percentage for [Child 1], she has not done so. Furthermore, any reduction of her child support income may result in a partial increase in family tax benefit which would somewhat ameliorate the effect of any overpayment.

1. While it is clear that the decision taking effect from 9 December 2017 will prejudice Ms Harrolds, the Tribunal finds that any prejudice to her would not be so great as to justify depriving Mr Harrolds of the full effect of the change of care which occurred in December 2017.

2. The Tribunal finds there were special reasons why Mr Harrolds made his application for the review out of time and finds that the care determination in relation to [Child 1] should take effect from the nominated change of care date, 9 December 2017.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that:

1. Mr Harrolds’ objection, to the care percentage decision in relation to [Child 1] made on 27 March 2018, is allowed;

2. There was a change of care on 9 December 2017 in relation to [Child 1] as a result of which Mr Harrolds’ care percentage for the child increased to 42%, while Ms Harrolds’ care percentage reduced to 58%.

3. The care percentage decision in relation to [Child 1] takes effect on 9 December 2017.