Hermann and Hermann (Child support)

[2019] AATA 4879

Hermann and Hermann (Child support) [2019] AATA 4879 (3 October 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/BC017161

APPLICANT:  Mr Hermann

OTHER PARTIES:  Child Support Registrar

Ms Hermann

TRIBUNAL:Member S Letch

DECISION DATE:  3 October 2019

DECISION:

The decisions under review are affirmed.

CATCHWORDS

CHILD SUPPORT – non-agency payment – whether payment made to a third party in lieu of child support – intention of both parents – whether payment constitutes a prescribed non-agency payment – whether payment ought not to be credited – 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

1. This matter concerns an application by Mr Hermann against an objection decision dated 14 August 2019. In that decision, the Child Support Agency (CSA) decided to refuse to credit non-agency payments (NAPs) and prescribed non-agency payments (PNAPs).

2. The Tribunal conducted a hearing on 1 October 2019; prior to the hearing, Ms Hermann indicated she would not participate; Mr Hermann participated in the hearing by conference telephone.

3. By way of brief background, in May 2019 – long after the child support case had ended in October 2018, Mr Hermann claimed some $40,000 as NAPs for a variety of costs associated with the children, and a further $10,000 or thereabouts as PNAPs. Included in his claims are costs related to telephone, health, and driving school lessons, amongst other things. Also claimed are school fees, which for child support purposes can be regarded as PNAPs.

4. Part V of the Child Support (Registration and Collection) Act 1988 provides for NAPs to be credited where, amongst other things, both the payer and payee intended for payments to be in partial or complete satisfaction of child support liability.

5. Ms Hermann has consistently denied that she held any intention for payments claimed by Mr Hermann to be in lieu of child support. Mr Hermann did not make such claims at the relevant time; there is no evidence which would suggest Ms Hermann had any intent for payments to be so regarded. The Tribunal agrees with the objections officer that the evidence reveals no proper basis to credit any of the NAPs claimed by Mr Hermann.

6. Mr Hermann argues that there is nothing in section 71C of the Act which requires there to be an active child support case in order to credit PNAPs. He points to the Child Support Guide at 5.3.1 which provides that “The Registrar can credit payments if the payment was made towards an enforceable maintenance liability or a carer liability. This includes non-agency payments made for arrears on ended cases”.

7. The Tribunal understands that one interpretation which has been favoured in respect of 71C is that it cannot apply after the case has ended; only ongoing and future liability can be reduced. Here, too, Mr Hermann did not make the claim until well after the case had ended; however, his claims relate to payments made during the enforceable maintenance period and prior to termination.

8. The policy guidelines appear to contradict that view, albeit without specifying that the policy includes PNAPs. The Tribunal presumes that if that policy were intended to exclude PNAPs, it would have expressly said as much.

9. Whilst one reading of section 71C might infer it may only apply prospectively to an ongoing liability, the Tribunal considers the better view is broader and that payments made prior to the end of the case, but claimed after, are not excluded from being credited as PNAPs. To interpret the provision otherwise would potentially give rise to cases where tardiness by the CSA in administering claims made, a payee might be excluded from operation where a case terminates. There appears no particular requirement for Mr Hermann to have made his claim prior to the end of the case, so long as the payments claimed were made prior to the conclusion of the case.

10. However, that is not the end of the matter. Section 71D of the Act provides that the Registrar can refuse to credit an amount if satisfied that, in the circumstances of the particular case, the amount ought not to be credited.

11. It seems to the Tribunal this case lends itself to an application of section 71D to refuse to credit the amounts claimed. The case has long ended; Mr Hermann made no such claims whilst the case was ongoing. It appears only steps towards collection by the CSA of the arrears still owing prompted Mr Hermann to come forward. It seems to the Tribunal it would be grossly unfair on Ms Hermann – entitled to rely and budget on the assessment to support the children, and to expect the unpaid liability to be recovered – to accept Mr Hermann’s belated claims for PNAPs and reduce the assessment long after the end of the case, and long after the claimed payments were made. The interest of finality weighs heavily in favour of an application of section 71D excluding all of Mr Hermann’s claimed payments.

12. The Tribunal therefore determines that the amounts claimed should not be credited in the particular circumstances of this case. As the Tribunal has reached the same conclusions as the objections officer, the decisions under review will be affirmed.

DECISION

The decisions under review are affirmed.