Hitchins and Hitchins (Child support)

[2024] AATA 4110

Hitchins and Hitchins (Child support) [2024] AATA 4110 (2 October 2024)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2024/BC028170

APPLICANT:  Ms Hitchins

OTHER PARTIES:  Child Support Registrar

MrHitchins

TRIBUNAL:Member S Letch

DECISION DATE:  2 October 2024

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – non-agency payment – tutoring fees – no mutual intent – decision under review affirmed

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

1. This matter concerns a decision by Child Support to refuse to credit a “non-agency payment” (NAP) claimed by Ms Hitchins.

2. It is convenient by way of background to set out some extracts from the objections officer’s decision dated 27 June 2024 which allowed Mr Hitchins’ objection:

   SUMMARY OF OBJECTION DECISION

   The outcome of this decision is that it has been allowed.

   The effect of the objection decision is: The credit of $3,995.00 recorded as a prescribed non agency payment will be removed from the account.

   DECISION UNDER REVIEW

   Type of decision being objected to: Prescribed Non Agency Payment (PNAP)

   Decision being objected to: The decision made on 11 August 2023 to record payment of $3,995.00 for Tutoring Fees as prescribed non-agency payment.

   …

   On 29 July 2023, [Ms Hitchins] reported a PNAP of $3,995.00 for tutoring fees. [Ms Hitchins] provided the following evidence:

   - Tax Receipt for [Business 1] $3,995.00 paid on 16 January 2023.

   On 4 August 2023, [Mr Hitchins] advised that there was no mutual intent for the tutoring fees to be credited in lieu of child support. [Mr Hitchins] advised that [Ms Hitchins] signed papers agreeing to cover the cost.

   On 11 August 2023, we made the decision to accept the payment as a PNAP and issued letters to both parents advising of the decision and of their objection rights.

   On 14 August 2023, [Mr Hitchins] objected to this decision on the grounds that there was no mutual intent for this payment to be credited in lieu of child support. [Mr Hitchins] stated that he pays for the childrens private school fees, uniforms book etc and that [Ms Hitchins] had signed an agreement where she would cover the tutoring cost. [Mr Hitchins] provided the following evidence:

   - [Business 1 variant] contract signed by [Ms Hitchins] for tutoring fees.

   REASONS FOR THE DECISION

   In order to accept payments as non-agency payments, and credit them in lieu of child support under section 71 of the Child Support (Registration and Collection) Act 1988, we must be satisfied that:

   - There was an enforceable maintenance liability in place;

   - The payment was actually made; and

   - There was mutual intent that the payment was made in lieu of child support.

   [Mr Hitchins] advised when we contacted him on 4 August 2023 that he did not agree that the tutoring fees should be credited in lieu of child support as there was no mutual intent.

   We can credit certain payments towards a payer’s child support liability regardless of the intention of the parents at the time the payment was made called Prescribed Non Agency Payments (PNAPs) (CSRC Act section 71C).

   Credit can be given up to a maximum of 30% of the liability, provided:

   ꞏ the balance of child support is paid as it becomes due and payable

   ꞏ the payer has less than 14% care of all of the children to whom the relevant administrative assessment relates at the time the credit is being applied (CSRC Act section 71C(1)(d)), and

   ꞏ the child support liability is not already being met by a lump sum credit (CSRC Act section 71C(5)(b)).

   The types of payments that can be credited in this way are prescribed by regulation (CSRC Act section 71C(1)(b) and CSRC Regs section 19).

   They are:

   Fees charged by a school or preschool for that child

   * This can include school fees and levies, but not payment for non-compulsory camps, excursions, additional tuition or boarding costs. A school is an institution that mainly provides primary or secondary education.

   It includes an institution providing technical and further education where the payment is for a course of secondary education.

   As tutoring fees are not included in the above list, we cannot consider these fees as PNAPs.

   Therefore, we make the decision to refuse to record a payment of $3,995.00 for Tutoring Fees as prescribed non-agency payment.

   The objection is allowed.

3. Both parties participated in the Tribunal’s hearing by conference telephone. In her written application to the Tribunal, Ms Hitchins advised the following (unedited):

   The extra payment which I gave to my daughter was for the private tutoring fee. Which my ex husband refused to pay it for her. My daughter asked me to help which I borrowed money from my friend and paid my friend off for 10 months. The payment should be accepted as my non agency payment because I did pay extra. I also gave the receipt to child support service as an evidence.

4. In summary, Ms Hitchins told the Tribunal that she paid for the tutoring to help her daughter’s English skills. She conceded that Mr Hitchins had not accepted that the amount was to be in lieu of child support. In broad terms, she considers it would be fair for the amount she paid – which she could not afford – to be taken into account. For his part, Mr Hitchins agrees with the objection decision; he said he had been grateful that Ms Hitchins had agreed to make the payment when he had been unable to afford it. He said that he pays many other costs related to schooling and other items, such as some $3,000 in recent months for dental costs, for which he has not approached Child Support to seek any further support from Ms Hitchins.

Application of the law

1. It is important to observe that the legislative test to be applied here is not one of general fairness or the exercise of some other broad discretion; the requirements to credit a non‑agency payment are very carefully prescribed.

2. 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.

3. Mr Hitchins has consistently maintained that she did not intend for those payments to be in lieu of child support. Ms Hitchins, for her part, does not seriously suggest Mr Hitchins intended the expense she met to be in lieu of child support; rather, more broadly, she argues it would be fair for the amount to be taken into account.

4. I am not satisfied that Mr Hitchins intended the payment to be in lieu of the enforceable maintenance liability. That payment cannot be credited as a “regular” non-agency payment.

5. Section 71C allows for a credit to occur for certain categories of payments regardless of the intention of the parties. The types of payments which can be taken into account are carefully subscribed. The Child Support Guide, at section 5.3.1, accurately summarises the relevant law:[1]

   [1] The Tribunal will apply the guidelines where they do not conflict with the relevant law: see Re Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409 and Re Drake and Minister for Immigration and Ethnic Affairs (No 2) [1979] AATA 179.

   Prescribed non-agency payments

   The Registrar can credit certain payments towards a payer’s child support liability regardless of the intention of the parents at the time the payment was made (CSRC Act section 71C), except if:

   ·      the liability is an overseas maintenance liability (CSRC Act section 71C(6))

   ·      the liability is a recovery order, or for spousal or de facto maintenance (CSRC Act section 71C(5)(a))

   ·      at the time the payment was made, the payer had at least regular care of any of the children to whom the relevant administrative assessment relates (CSRC Act section 71C(1)(ba)), or

   ·      at the time the payment was made, the child support liability was being fully or partially met by a lump sum credit (CSRC Act section 71C(2)) (refer to 5.3.3).

   Credit can be given up to a maximum of 30% of the liability, provided:

   ·      the balance of child support is paid as it becomes due and payable

   ·      the payer has less than 14% care of all of the children to whom the relevant administrative assessment relates at the time the credit is being applied (CSRC Act section 71C(1)(d)), and

   ·      the child support liability is not already being met by a lump sum credit (CSRC Act section 71C(5)(b)).

   The balance can be paid in cash or in the form of a non-agency payment credited under CSRC Act sections 71 or 71A, or from money credited from another source such as a tax refund or payment from a third party.

   The Registrar can only credit amounts paid on or after 1 July 1999.

   The types of payments that can be credited in this way are prescribed by regulation (CSRC Act section 71C(1)(b) and CSRC Regs section 19). They are:

   ·      child care costs for the child who is the subject of the enforceable maintenance liability

   ·      fees charged by a school or preschool for that child

   ·      amounts payable for uniforms & books required by a school or preschool for that child

   ·      fees for essential medical and dental services for that child

   ·      the payee’s share of amounts payable for the payee’s home, and

   ·      costs to the payee of obtaining & running a motor vehicle, including repairs & standing costs.

   If the payer satisfies the conditions and the prescribed non-agency payment is accepted, the Registrar can credit up to 30% of the current liability from the date of notification of the payment. If the amount of the payment is more than 30% of the enforceable maintenance liability in a given month, the excess amount will be retained as an ‘uncredited’ amount. This uncredited amount can be applied against the payer’s enforceable maintenance liability in a later month provided the conditions for payment are again met, and can be carried over to a different child support enforcement period as long as it relates to the same liability.

   …

   Fees charged by a school or preschool for a child who is the subject of an enforceable maintenance liability

   This can include school fees and levies, but not payment for non-compulsory camps, excursions, additional tuition or boarding costs. A school is an institution that mainly provides primary or secondary education.

   It includes an institution providing technical and further education where the payment is for a course of secondary education.

6. I am satisfied that the additional tuition fees paid by Ms Hitchins were not intended to be captured by Regulation 19 of the Child Support (Registration and Collection) Regulations 2018. Accordingly, there is no basis to credit the payment claimed by Ms Hitchins as a prescribed non-agency payment.

7. As this is the same conclusion as the objection officer, the decision under review will be affirmed.

DECISION

The decision under review is affirmed.