He v Secretary, Department of Education, Skills and Employment
[2023] FedCFamC2G 356
•9 May 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
He v Secretary, Department of Education, Skills and Employment [2023] FedCFamC2G 356
File number(s): BRG 40 of 2022 Judgment of: JUDGE EGAN Date of judgment: 9 May 2023 Catchwords: ADMINISTRATIVE LAW – Appeal from Administrative Appeals Tribunal on a question of law - construction of s. 44(1)(c) of A New Tax System (Family Assistance) Act 1999 (Cth) – no jurisdictional or legal error established on the part of the Tribunal - appeal dismissed Legislation: A New Tax System (Family Assistance) Act 1999 (Cth) ss. 44, 57EAA, 57EA, 57F
Administrative Appeals Tribunal Act 1975 (Cth) Section 44
Queensland Law Society Act 1952 (Qld) Part 1 - Preliminary
Cases cited: Re Equuscorp Pty Ltd v Short Punch & Greatorix (2001) 2 Qd R 580.
Secretary, Department of Education and Training v Simpson Networks Pty Ltd (2019) 273 FCR 252.
Division: Division 2 General Federal Law Number of paragraphs: 28 Date of last submission/s: 5 May 2023 Date of hearing: 19 April 2023 Counsel for the Applicant: Ms J Marr Solicitor for the Applicant: Fisher Dore Lawyers Counsel for the Respondent: Mr A Hartnett Solicitor for the Respondent: Mills Oakley ORDERS
BRG 40 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: JIAN HE
Applicant
AND: SECRETARY, DEPARTMENT OF EDUCATION, SKILLS AND EMPLOYMENT
Respondent
order made by:
JUDGE EGAN
DATE OF ORDER:
9 MAY 2023
THE COURT ORDERS THAT:
1.The Applicant have leave to rely upon the Further Amended Notice of Appeal filed on 30 January 2023.
2.The Appeal be dismissed.
3.The Applicant pay the Respondent’s costs to be agreed, or failing agreement, to be taxed pursuant to r. 22.10 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
Judge Egan
Introduction
The applicant was married to one Ms Zhou. The applicant and Ms Zhou separated in May 2016. There was a child born of the marriage between the applicant and Ms Zhou (“the child”).
From at least in or about January 2016 up until the time of separation, the child had been enrolled at an Early Learning Centre (ELC) named “Avenues Early Learning Centre” (“Avenues”) situated at Sunnybank Hills in Brisbane. During such period of time, the applicant had been recorded by Avenues as being the person who had enrolled the child with Avenues. Avenues had also recorded the fact that under the provisions of the A New Tax System (Family Assistance) Act 1999 (Cth) it had reduced the amount of fees payable for the provision by it of services in respect of the child during such period. Such fee reduction entitlement, as assessed, was based upon the recorded income of the child’s parents. The reduction amount was commensurate to the amount received by Avenues from Centrelink after such assessment had been undertaken. [1]
[1] See statements respectively dated 15 March 2016, 21 March 2016, 1 April 2016, 15 April 2016 and 13
The Administrative Appeals Tribunal (“the Tribunal”), in its reasons for decision handed down on 19 November 2021, succinctly set out the applicable Centrelink fee reduction entitlement regime, and the method of payment of such entitlements, at [1] – [4] inclusive of its reasons, as follows: [2]
“[1]The Australian government provides a range of social security benefits to its citizens and other eligible residents. The delivery of those payments and services, especially social security payments, is provided by Services Australia through Centrelink. Those benefits include Child Care Benefit and Child Care Rebate.
[2]Child Care Benefit (CCB) was an income-tested payment to assist eligible parents and carers with the cost of Childcare to provide incentives for parents and carers with low and middle incomes to participate in the workforce and community and to balance work and family commitments. CCB could be paid to the approved Childcare service and passed on to the person as a fee reduction; or the person may pay the Childcare fees and claim CCB as a lump sum at the end of the financial year.
[3]Child Care Rebate (CCR) was a payment from the Australian Government to help working families with the cost of Childcare. Parents using approved Childcare for work, training or study-related reasons could apply for the Government to cover 50% of out-of-pocket Childcare costs, up to the annual limit. CCR was paid fortnightly or to the Childcare service provider as a fee reduction. CCR could also be paid quarterly or annually as a lump sum directly to a bank account.
[4]An eligible recipient must first be entitled to CCB before they can be eligible for CCR. Both benefits could be paid to the approved Childcare provider as a fee reduction or as a lump sum to the person eligible to receive the benefit.”
[2] Annexure TWF-1 to Mr Fisher’s affidavit.
After the applicant and Ms Zhou separated in May 2016, the child did not attend Avenues until on or about 12 July 2016. At the time that the child recommenced attendance at Avenues on 12 July 2016, Ms Zhou was recorded by Avenues as being the person who had enrolled the child with it at that time. That enrolment in the name of Ms Zhou continued up until on or about 1 June 2017. [3]
[3] See statement purportedly dated 30 May 2017 at pp. 146 – 152 of annexure TWF-2 to the affidavit of
There was a dispute between the parties as to the validity of agreements reached between the applicant and Ms Zhou concerning the payment of fees to Avenues after separation. The agreements were either the subject of Federal Circuit Court consent orders, or what was referred to as a “parenting plan” submitted to such Court for approval. The determination of the validity of such agreements is not a matter which the Court needs to rule upon in the light of its finding as to what the proper construction of the governing legislation in dispute. What was not in dispute was that the applicant paid 100% of such fees from 12 July 2016 until on or about 30 November 2016, and that thereafter, the applicant paid 65% and Ms Zhou paid 35% of such fees until on or about 5 June 2017 when the child was re-enrolled with Avenues under the applicant’s name.
Notwithstanding the fact of the said payments by the applicant to Avenues for services provided to the child during the relevant periods, and further notwithstanding that such fees as had been charged had been the subject of fee reductions, Centrelink decided not to pay, or otherwise give to the applicant, a credit for the full amounts paid by him during the relevant periods.
The applicant sought a review of the Centrelink decision by an authorised review officer in the employ of Services Australia. On 19 June 2020, the review officer affirmed the Centrelink decision.[4]
[4] See pp. 110 – 112 of Annexure TWF-2 to Mr Fisher’s Affidavit.
By an application for review of that decision submitted on 2 December 2020, [5] the applicant applied for a reassessment by a member of the Social Services and Child Support Division of the Administrative Appeals Tribunal.
[5] See pp. 30 – 34 of Annexure TWF-2 to Mr Fisher’s Affidavit.
On 19 November 2021, a member of the Tribunal affirmed the decision of the review officer. The Tribunal set out its reasons at [27] – [33] inclusive of its decision, in respect of the relevant periods, as follows:
“[27]The historical facts around Case 1 and the payment of CCB and CCR to Mr He, and the origin of the dispute, are set out in detail in [4] to [34] of R-SFIC1. Mr He disputes some of the facts included in R-SFIC1, which are also mentioned below.
[28]In Case 1, the difference between being responsible for a payment and liable for a payment bears consideration especially as it is of great importance to Mr He. Being responsible for a payment means answerable or liable to be called to account to another person for something. Being liable for a payment means bound or obliged by law or equity, or in accordance with a rule or convention. Based on those dictionary definitions, being liable and being responsible are close in meaning.
[29]In Re Equuscorp de Jersey CJ, McPherson JA and White J provided clarity to the meaning of the word ‘liable’ at [10]:
‘The words “liable to pay” in s 3 carry their usual meaning “responsible in law” (Littlewood v George Wimpey & Co Ltd [1953] 2 QB 501, 515), and a person liable to pay is “a person against whom payment of the (costs) can be enforced” (Deputy Commissioner for Taxation v Moorebank Pty Ltd [1987] q Qd R 414, 416)’
[30]The wording in s 43(1)(c) and s 44(1)(c) of the FA Act is clear. A Childcare benefit, whether for a past period or otherwise, is payable to the individual who has incurred the liability to pay for the session of care. That is, which individual could the provider of the session of care, the ELC in this case, have successfully sued for the fees for that session.
[31]The Child was enrolled in the ELC on 4 January 2016. The ELC was asked to provide copies of all enrolment documents relating to the Child. They were not able to provide a copy of the original enrolment done in January 2016 however they were able to provide a copy of the enrolment done by Mr He on 1 June 2017. As will be seen later, the Tribunal is satisfied the original enrolment was done by the mother (Ms Zhou).
[32]Mr He and Ms Zhou separated on 24 May 2016 and from then until 11 July 2016, a period of 50 days, the Child was withheld from Childcare and from Mr He. CCB and CCR was paid to Mr He for the period from original enrolment on 4 January 2016 to 23 May 2016. The Child resumed attendance at the ELC on 12 July 2016, being the date of the Federal Circuit Court of Australia (FCCA) Temporary Parenting Orders.
[33]Payment of CCB and CCR to Mr He prior to 24 May 2016 would have been on the basis he and Ms Zhou were partners so s 43(1)(c) would have applied as one or the other of them were liable to pay for the sessions of care.”
Not being satisfied with the decision of the Tribunal, the applicant filed a notice of appeal in the registry of the Federal Court of Australia pursuant to the provisions of section 44 of the Administrative Appeals Tribunal Act 1975 (Cth). By order of Her Honour Justice Collier made on 1 February 2022, the matter was remitted to this Court for the hearing of the appeal.
Matters for Consideration under Appeal
The orders sought in the Further Amended Notice of Appeal filed on 30 January 2023 were as follows:
“1. Paragraphs 48 and 49 of the decision of the Tribunal be set aside.
2. The Court substitute its own decision that the applicant satisfied the eligibility criterion in s 44(1)(c) of the Act in that the applicant had incurred a liability to pay for the sessions of child care for the 2016/2017 year.
3. Alternatively to the order in paragraph 2 above, the case be remitted to the Tribunal to be decided again in accordance with the directions of the Court.
4. Further to the order in paragraph 3 above, the applicant be permitted to adduce further evidence relevant to the question of whether the applicant incurred a liability to pay for the sessions of child care for the 2016/2017 year.
5. The respondent pay the applicant’s costs of and incidental to this application, to be agreed or otherwise assessed.”
Paragraphs 48 and 49 of the decision of the Tribunal were as follows:
“[48] The Tribunal finds the account holder, and therefore the person who was liable for the fees payable for the sessions of care for the Child from January 2016 until 1 June 2017, was Ms Zhou (the mother).
[49] The calculation of the CCB and CCR for the Child for the period from January 2016 to 1 June 2017, based on the account holder being the mother and therefore liable for fees, is not in dispute. Accordingly, the Tribunal affirms the decision in Case 1 in respect of the 2016/2017 financial year.”
The grounds of appeal relied upon were as follows:
“1. Paragraphs 48 and 49 of the decision of the Tribunal should be set aside because the Tribunal misconstrued the proper meaning of the expression 'incurred a liability to pay' within the meaning of the A New Tax System (Family Assistance) Act 1999 (Cth), s 44(1)(c) (as in force on 17 August 2017).
2. The Tribunal erroneously narrowed the statutory eligibility criterion ins 44(1 )(c) by imposing the additional constraint of "incurred a liability to pay to the approved child care service' when there was no statutory mandate or proper or reasonable basis to do so.
3. The Tribunal erroneously confined the 'liability' referred to ins 44(1 )(c) to one species of liability, being a direct contractual obligation to the approved child care service when there was no statutory mandate or proper or reasonable basis to do so.
4. The Tribunal erroneously failed to properly consider whether the applicant's liability to pay for the child care sessions pursuant to the Family Court consent orders of 12 July 2016 and 21 October 2016 constituted the incurring of a liability within the meaning of ANew Tax System (Family Assistance) Act 1999 (Cth), s 44(1)(c) (as in force on 17 August 2017).”
The question of law identified in the appeal was as follows:
“1. Whether the Tribunal misconstrued s 44(1)(c) of the A New Tax System (Family Assistance) Act 1999 (Cth) (as in force on 17 August 2017) in finding at paragraph 48 of the decision that the person who had ‘incurred a liability to pay’ was the ‘account holder’?”
The finding of fact which the Court was asked to make was as follows:
“1. Pursuant to the Family Court consent orders of 12 July 2016 and 21 October 2016, the applicant had incurred a liability to pay for the sessions of child care in respect of the child, for the 2016/2017 year.”
Section 44 of the A New Tax System (Family Assistance) Act 1999 (Cth) (‘FAA’) relevantly provided as follows:
“44 When an individual is eligible for child care benefit for a past period for care provided by an approved child care service
(1) An individual is eligible for child care benefit for a past period for a session of care provided by an approved child care service to a child if:
(a) the child is an FTB child, or a regular care child, of the individual, or the individual’s partner, during the session; and
(b) the care is provided in Australia; and
(ba) the care is not provided as part of the compulsory education program in the State or Territory where the care is provided; and
(c) the individual, or the individual’s partner, has incurred a liability to pay for the session (whether or not the liability has been discharged); and
(d) when a claim by the individual for payment of child care benefit in respect of the session is determined in accordance with Part 3 of the Family Assistance Administration Act, the individual, or the individual’s partner:
(i) is an Australian resident; or
(ia) is a special category visa holder residing in Australia; or
(ii) satisfies subsection (1A); or
(iii) is undertaking a course of study in Australia and receiving financial assistance directly from the Commonwealth for the purpose of undertaking that study; and
(e) when a claim by the individual for payment of child care benefit in respect of the session is determined in accordance with Part 3 of the Family Assistance Administration Act, the requirement relating to immunisation set out in subsection (2) is met in respect of the child; and
(f) the session starts on or after the commencement of this Act.
When individual satisfies this subsection
(1A) An individual satisfies this subsection if:
(a) the individual is the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act 1991; and
(b) either:
(i) the individual is in Australia; or
(ii) the individual is temporarily absent from Australia for a period not exceeding 6 weeks and the absence is an allowable absence in relation to special benefit within the meaning of Part 4.2 of that Act.
Requirement relating to immunisation referred to in paragraph (1)(e)
(2) For the purposes of paragraph (1)(e), the requirement relating to immunisation is that, if the child is under 20, the child must meet the immunisation requirements set out in section 6.
Secretary may determine that individual is a regular care child
(3) The Secretary may determine that an individual who is neither an FTB child, nor a regular care child, of another individual during the session of care is taken to be a regular care child of the other individual during that session for the purposes of paragraph (1)(a).
Section subject to Subdivisions F and G
(4) This section is subject to Subdivisions F and G (which deal with limits on eligibility).”
Eligibility for payment of a child rebate was determined by reference to the provisions of ss. 57EAA, 57EA and 57F of the FAA.
At the hearing before the Court, it was conceded by Counsel on behalf of the applicant that Ms Zhou was not “the individual’s partner” for the purposes of s. 44(1)(c) of the FAA because, at all relevant times, the applicant and Ms Zhou were separated. It was therefore submitted on behalf of the applicant that because of consent orders made by the then Federal Circuit Court of Australia on 12 July 2016, [6] and also because of an application for consent orders (unsuccessfully sought to be approved by a Registrar) which was said to constitute a parenting agreement entered into between the applicant and Ms Zhou relating to the payment by the applicant of the Avenues fees as part of child maintenance, that that constituted the applicant as being the individual who had incurred the liability to pay for the Avenues fees for the purposes of s. 44(1)(c).
[6] See pp. 303 – 305 of Annexure TWF-2 to Mr Fisher’s Affidavit.
It was submitted on behalf of the applicant that the express terms of s. 44(1)(c) did not require that the relevant individual must have incurred a liability directly with the child care service provider to pay the relevant fees. It was submitted that the requirement was “ … simply that the individual had “incurred a liability to pay”.”
Counsel for the applicant relied upon the judgment of the Full Court of the Supreme Court in Re Equuscorp Pty Ltd v Short Punch & Greatorix (2001) 2 Qd R 580 in support of the proposition that, when construing s. 44(1)(c), there was no justification for the section to be given a narrow meaning. However, the question in Equuscorp turned upon the proper meaning to be given to the definition of “client” under the then binding provisions of the Queensland Law Society Act 1952 (Qld), where “client” was defined as follows:
‘client includes a person who has paid, or is liable to pay, the account of a client.’
There is a clear distinction between an individual who might be liable to pay something, and an individual who incurred a liability to pay something. It is trite that either legislatively, or by agreement, an individual other than the person who incurred a legal liability to pay for something might relevantly be liable/responsible for payment. In the present factual circumstances, Ms Zhou was the person who incurred the legal liability for payment. She may have had a right of indemnity against the applicant for the amount of the required fee, because it had been agreed between the applicant and Ms Zhou that the applicant was the person liable/responsible for payment, but that agreement did not alter the fact that it was Ms Zhou who had incurred the liability to pay Avenues for the relevant sessions. That was so not only had legal proceedings been commenced against her for recovery of any debt owing for unpaid fees, but in any event.
The Court finds that on a construction that is consonant with the plain and ordinary meaning of the words in the section, s. 44(1)(c), such section is directed toward the individual who actually incurred the legal liability for payment of Avenues’ fees. There are sound policy reasons for that to be the case. If the applicant’s argument was to be accepted, then providers of services such as Avenues would bear the burden of having to look behind each and every enrolment form before legal proceedings could be commenced by them against a parent or guardian in the event of non-payment of service/session fees. That could potentially place such ELC in the invidious and uncertain position of having to delve into the private affairs of individuals who might be in serious and heated conflict involving their respective family law obligations or entitlements. The Court finds that that was not the intention of the legislature at the time of enactment of the legislation.
The word “incur” is defined in the English Oxford Dictionary to mean – “ … to become through one's own action liable or subject to; to bring upon oneself.”
The evidence accepted by the Tribunal was that notwithstanding the absence of a signed enrolment form evidencing that Ms Zhou had contractually enrolled the child during the relevant period (such form was said to no longer be in the possession of Avenues), the Centre Manager at Avenues named Carla Hudson confirmed that the account holder was the person who held the CCB rights, and that such person was Ms Zhou and not the applicant. Such finding was open to the Tribunal based upon a consideration of all of the evidence before it, including questions sent by the Tribunal to Avenues, and answers to such questions. [7] Having found that Ms Zhou was the account holder and person who “held the CCB rights”, the Tribunal did not err in its construction of s. 44(1)(c) when it found that Ms Zhou was the person who had enrolled the child, or when it found that she was relevantly the person who had incurred the liability to pay Avenues for its services. Support for that finding is found in the decision of the Full Court of the Federal Court in Secretary, Department of Education and Training v Simpson Networks Pty Ltd (2019) 273 FCR 252 at [24] where, when considering the provisions of s 43(1)(c) of the FAA, Greenwood, Yates and Colvin JJ said:
“[24]Speaking generally, the Act said that an individual 'is eligible for child care benefit by fee reduction for a session of care', if there has been a determination of conditional eligibility under the Administration Act and the care has been provided: s 43(1). Importantly for present purposes there was no eligibility unless the individual 'incurred a liability to pay for the session of care': s 43(1)(c) (emphasis added). This requirement was consistent with the concept of payment of a 'benefit by fee reduction'. Language of that kind necessarily contemplated the existence of a liability to pay a fee for child care for which liability could be reduced.”
[7] See pp. 362 – 364 and pp. 380 – 384 of Annexure TWF-2 to Mr Fisher’s Affidavit.
The Court finds that the Tribunal did not misconstrue the provisions of s. 44(1)(c) of the FAA.
In the light of the findings of the Court, it is unnecessary to deal with questions going to the validity or otherwise of any orders of the Federal Circuit Court, or of any agreement purportedly entered into pursuant to provisions of the Family Law Act 1975 (Cwth). Any determination as to the validity or enforceability of the Federal Circuit Court orders, or of the terms of any parenting plan, would not adversely impact upon the Court’s finding that it was Ms Zhou who had incurred the relevant liability to pay the Avenues fees under s. 44(1)(c).
The applicant has failed to establish any legal or jurisdictional error on the part of the Tribunal.
The Court will hear the parties as to costs.
I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Egan. Associate:
Dated: 9 May 2023
May 2016 at pp. 140 - 145 of annexure TWF-2 to the affidavit of Mr Fisher filed on 5 October 2022.
Mr Fisher.
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