Hempsell and Kembell (Child support) - [2022] AATA 4100

Hempsell and Kembell (Child support) [2022] AATA 4100 (12 September 2022)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2021/MC022917
APPLICANT:  Mr Hempsell
OTHER PARTIES:  Child Support Registrar
Mrs Kembell

TRIBUNAL:Member P Noonan
DECISION DATE: 12 September 2022
DECISION:

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

·For the period 1 May 2021 to 30 July 2024, the annual adjusted taxable income of Mr Hempsell is varied to $153,111. Further, the annual amount of child support payable by Mr Hempsell is varied (increased) by $2,956 per annum for the period 1 May 2021 to 30 April 2023.

CATCHWORDS

CHILD SUPPORT – departure determination – income, property and financial resources of the liable parent – cost of orthodontic work for children – a ground for departure established – decision to depart - decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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

Mr Hempsell and Mrs Kembell are the parents of two children who are currently relevant to the child support assessment.
A child support case was first registered with Services Australia (the Agency) on 16 September 2013 and child support has been registered for collection by the Agency since then. The Agency currently maintains a case completion date for this matter of 6 July 2028.
On 13 April 2021 Mrs Kembell applied for a departure from the assessment of child support payable at that time. At the time of Mrs Kembell’s departure application, the applicable assessment of child support payable stipulated that:
· For the period 1 March 2019 to 31 December 2021, Mr Hempsell’s adjustable taxable income is set at $70,000.
On 29 July 2021 an Agency officer, acting as a delegate of the Child Support Registrar, found that a ground for departure was established and decided to depart from the assessment in the following terms:
· For the period 13 April 2021 to 31 March 2024, Mr Hempsell’s adjustable taxable income is set at $186,000.
Mr Hempsell objected to this decision and on 17 September 2021, an Agency objections officer partly allowed his objection in the following terms:
· For the period 1 May 2021 to 30 April 2026, the adjusted taxable income (ATI) used in the assessment for Mr Hempsell is set to $150,000. Further, Mr Hempsell’s ATI will be increased on 1 July 2022 and each year thereafter on 1 July by the CPI Amount Weighted Average for the preceding March quarter.
Mr Hempsell subsequently applied to the Tribunal for an independent review of the Agency’s decision. A hearing for the matter was held on 12 September 2022 by conference telephone. The Child Support Registrar did not attend the hearing. Both Mr Hempsell and Mrs Kembell attended the hearing and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] AATA 4100
Decision Date: 12 September 2022

CaseChat Overview and Summary

This matter concerned an appeal to the Federal Circuit Court of Australia regarding a departure determination made by the Child Support Registrar. The appeal was brought by the liable parent, Mr Hempsell, against a decision of the Registrar to depart from the formula assessment of child support payable to the other parent, Ms Kembell, for the benefit of their two children. The dispute centred on whether the Registrar had erred in her decision to depart from the assessment.

The primary legal issue before the Court was whether the Registrar had correctly applied the provisions of the *Child Support (Registration and Collection) Act 1988* (Cth) in making the departure determination. Specifically, the Court had to consider whether the Registrar had properly identified a ground for departure under section 117 of the Act and, if so, whether the departure decision itself was justified. The Court also considered the weight to be given to the cost of orthodontic treatment for the children as a factor in the departure assessment.

The Court found that the Registrar had erred in her assessment of the departure grounds. While acknowledging that the cost of orthodontic treatment could, in certain circumstances, constitute a ground for departure under section 117(1)(e) of the Act, the Court determined that the Registrar had not adequately considered the specific financial circumstances of both parents in relation to this expense. The Court held that a departure determination requires a holistic assessment of the impact of the expense on the capacity of the liable parent to pay the assessed amount, and the capacity of the other parent to meet their obligations. The Court concluded that the Registrar had failed to undertake this comprehensive assessment.

Consequently, the Court set aside the Registrar's departure determination and substituted its own decision. The Court ordered that no departure from the formula assessment of child support was justified in this instance.

Orders