Hyde v Child Support Registrar
[2016] FCCA 3006
•25 November 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| HYDE v CHILD SUPPORT REGISTRAR | [2016] FCCA 3006 |
| Catchwords: COURTS AND JUDGES – Jurisdiction – whether jurisdiction to make administrative orders on an appeal against making of departure prohibition order. |
| Legislation: Child Support (Registration and Collection) Act 1988 (Cth), Part VA, ss.15(1), 17, 72D, 72E, 72I, 72Q, 72R, 72S, 116(2) |
| Albaugh & Child Support Registrar [2007] FMCAfam 1106 Edelsten v Federal Commissioner of Taxation (1989) 20 ATR 238; (1989) 85 ALR 226; (1989) 89 ATC 4120 Hyde & Hyde [2014] FCWAM 261 Jones v Child Support Registrar [2007] FCA 1732 Onder v Child Support Registrar & Anor (No.2)[2011] FMCAfam 430; (2011) 250 FLR 345; (2011) 45 Fam LR 577 Russo & Child Support Registrar [2009] FMCAfam 437 T v Commissioner of Taxation (Cth) (1986) 18 ATR 1; (1986) 86 ATC 4894 Whittaker & Anor v Child Support Registrar & Anor [2010] FCA 43; (2010) 264 ALR 473; (2010) FLC 98-049 Williams v Child Support Registrar [2009] FMCA 481; (2009) 109 ALD 343 |
| Applicant: | MR HYDE |
| Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | PEG 32 of 2014 |
| Judgment of: | Judge Antoni Lucev |
| Hearing date: | 19 March 2014 |
| Date of Last Submission: | 19 March 2014 |
| Delivered at: | Perth |
| Delivered on: | 25 November 2016 |
REPRESENTATION
| Solicitors for the Applicant: | In person |
| Counsel for the Respondent: | Ms A Ladhams |
| Solicitors for the Respondent: | Australian Government Solicitor |
ORDERS
That the applicant’s Notice of Appeal (Child Support) filed 6 February 2014 be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Hyde v Child Support Registrar is approved pursuant to s.110X(4)(h) of the Child Support (Registration and Collection) Act 1988 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PERTH |
PEG 32 of 2014
| MR HYDE |
Applicant
And
| CHILD SUPPORT REGISTRAR |
Respondent
REASONS FOR JUDGMENT
Introduction
The applicant, Mr Hyde (“Mr Hyde”), appeals by Notice of Appeal (Child Support) filed on 6 February 2014 (“Appeal” and “Notice of Appeal” respectively), against a decision of the respondent, the Child Support Registrar (“Registrar”) made on 13 November 2013, being a decision pursuant to s.72D of the Child Support (Registration & Collection) Act 1988 (Cth) (“Registration & Collection Act”) to issue a departure prohibition order (“DPO”) to prevent Mr Hyde from travelling outside of Australia.
The Appeal is made under s.72Q of the Registration & Collection Act, which allows a person aggrieved by the making of a DPO to appeal to this Court against the making of the DPO.
Section 72S of the Registration & Collection Act provides that in an appeal pursuant to s.72Q of the Registration & Collection Act, the Court may, at its discretion, set aside a DPO or dismiss an appeal.
The Registrar submits that the Appeal should be dismissed.
Background
Mr Hyde has been assessed to pay child support in relation to four children born (omitted) 1988, (omitted) 1991, (omitted) 1995 and (omitted) 1997 respectively. This child support liability has been registered for collection by the Department of Human Services (“Department”) since the inception of a child support case in 2001: Affidavit of Mr T, affirmed 28 February 2014, at [3] and [4] (“Mr T Affidavit”).
Mr Hyde has lived and worked overseas since 2003: Affidavit of Mr Hyde, sworn 6 February 2014, at annexure H1 (“Mr Hyde’s 6 February 2014 Affidavit”). Mr Hyde resided in (country omitted) until 2009 and was assessed to pay child support, collectable by the Department, while in (country omitted), it being a country with a reciprocal child support agreement with Australia: Mr T Affidavit at [5].
Mr Hyde’s ongoing child support liability ceased with effect from 10 November 2009, when he advised the Department that he had become a resident of (country omitted), a country with whom Australia does not have a reciprocal child support agreement. Mr Hyde nevertheless remained liable for arrears of child support that had accrued prior to the cessation of his child support liability: Mr T Affidavit at [6].
On 5 November 2013, Mr Hyde returned to Australia.
As at 13 November 2013 Mr Hyde had a child support debt of $46,989.85, comprising $44,310.62 in arrears of child support and $2,679.23 in late payment penalties: Mr T Affidavit at [8].
On 13 November 2013, the Registrar issued a DPO to Mr Hyde which prevents Mr Hyde from travelling outside of Australia. The decision to issue the DPO was made by a delegate of the Registrar (“Decision” and “Delegate” respectively) on the basis of a submission (“DPO Submission”) prepared by the Delegate, an employee of the Department: Mr T Affidavit at [9] and [10]. Section 15(1) of the Registration & Collection Act allows the Registrar to delegate powers or functions to an officer or employee of the Department.
Other relevant factual material is set out or referred to where appropriate in these Reasons for Judgment below.
Evidence and submissions
In this matter the Court has had regard to each of the five affidavits sworn by Mr Hyde, on 6 February 2014 (two affidavits), 25 February 2014, 7 March 2014 and 12 March 2014 and the Mr T Affidavit.
The Court has also had regard to the outlines of submissions filed by Mr Hyde on 4 March 2014 and by the Registrar on 11 March 2014.
Relevant legislation
The provisions relevant to DPOs are set out in Part VA of the Registration and Collection Act. The relevant provisions for the purposes of the Appeal are set out below.
Section 72D of the Registration & Collection Act sets out the Child Support Registrar’s power to make a DPO and provides:
(1) The Registrar may make an order (a departure prohibition order) prohibiting a person from departing from Australia for a foreign country if:
(a) the person has a child support liability; and
(b) the person has not made arrangements satisfactory to the Registrar for the child support liability to be wholly discharged; and
(c) the Registrar is satisfied that the person has persistently and without reasonable grounds failed to pay:
(i) child support debts arising from a registrable maintenance liability under section 17; or
(ii) a child support debt arising from a registrable maintenance liability under section 17A; or
(iii) one or more child support debts arising from a registrable overseas maintenance liability under subsection 18A(1), paragraph 18A(3)(a) or subsection 18A(4) (insofar as subsection 18A(4) relates to subsection 18A(1) or paragraph 18A(3)(a)); and
(d) the Registrar believes on reasonable grounds that it is desirable to make the order for the purpose of ensuring that the person does not depart from Australia for a foreign country without:
(i) wholly discharging the child support liability; or
(ii) making arrangements satisfactory to the Registrar for the child support liability to be wholly discharged.
(2) For the purposes of paragraph (1)(c), the Registrar must have regard to the following matters:
(a) the capacity of the person concerned to pay the debt or debts;
(b) the number of occasions on which action has been taken to recover the debt or debts, and the outcome of the recovery action;
(c) if subparagraph (1)(c)(i) applies—the number of occasions on which the debts mentioned in that subparagraph had not been paid on or before the day on which they became due and payable;
(d) if subparagraph (1)(c)(ii) applies—the length of time for which the debt mentioned in that subparagraph has remained unpaid after the day on which it became due and payable;
(da) if subparagraph (1)(c)(iii) applies:
(i) the length of time for which the debts mentioned in that subparagraph have remained unpaid after the day on which they became due and payable; and
(ii) the number of occasions on which the debts mentioned in that subparagraph had not been paid on or before the day on which they became due and payable;
(e) such other matters as the Registrar considers appropriate.
(3) A departure prohibition order must be in the approved form.
Sections 72Q, 72R and 72S of the Registration and Collection Act relates to appeals against the making of DPOs and provide:
72Q Appeals to courts against making of departure prohibition orders
(1) A person aggrieved by the making of a departure prohibition order may appeal to the Federal Court of Australia or the Federal Circuit Court of Australia against the making of the order.
(2) This section has effect:
(a) subject to Chapter III of the Constitution; and
(b) despite anything contained in section 9 of the Administrative Decisions (Judicial Review) Act 1977.
72R Jurisdiction of courts
The jurisdiction of a court under section 72Q must be exercised by a single Judge or Justice.
72S Orders of court on appeal
A court hearing an appeal under section 72Q against the making of a departure prohibition order may, in its discretion:
(a) make an order setting aside the order; or
(b) dismiss the appeal.
Orders sought on the Appeal
In the Notice of Appeal the following three orders are sought:
1. That the Departure Prohibition Order be immediately stayed pending a review of the outstanding sum as per related WA Family Law Court Application for Departure from Child Support Registry Administrative Assessment, to review income and expenditure for both payer and payee parties greater than 18 month back date period (Specifically from Years 2007 onwards) for child support assessment purposes, due to the special circumstances associated with income and expenditure in specifically 2007/2008/2009 calendar years.
2. That the Court immediately instruct the Respondent to re-introduce the agreed “satisfactory arrangement” instalments of A$600 per month as originally agreed by both Parties, so long as the Applicant is actually gainfully employed.
3. That subsequently the Departure Prohibition Order be set aside, once the size of the arrears is identified by the Family Law Court and Applicant new employment conditions is known and the parties can agree on a sensible “satisfactory arrangement” for the payment of the arrears.
Jurisdiction in relation to orders sought
Sections 72Q and 72S of the Registration and Collection Act have the effect that on the Appeal the Court is to exercise judicial power, and is not to engage in administrative decision-making: T v Commissioner of Taxation (Cth) (1986) 18 ATR 1; (1986) 86 ATC 4894; ATR at 2-3 per Woodward J; Edelsten v Federal Commissioner of Taxation (1989) 20 ATR 238; (1989) 85 ALR 226; (1989) 89 ATC 4120; ATR at 240-241 per Einfeld J.
If Mr Hyde and the Registrar subsequently come to an arrangement satisfactory to the Registrar for the payment of the total debt, the Registrar will be required to revoke the DPO: Registration & Collection Act, s.72I. This process does not involve recourse to the Court.
The only application in relation to the DPO that Mr Hyde can bring to this Court is a challenge to the validity of the DPO on the basis that it was not properly made: Jones v Child Support Registrar [2007] FCA 1732 (“Jones”); Albaugh & Child Support Registrar [2007] FMCAfam 1106 at [17]-[18] per Sexton FM (“Albaugh”); Williams v Child Support Registrar [2009] FMCA 481; (2009) 109 ALD 343 at 355 per Lucev FM (“Williams”). Jones has been cited with approval in subsequent cases: Albaugh at [17]-[18] per Sexton FM; Russo & Child Support Registrar [2009] FMCAfam 437 at [16]-[17] per Sexton FM (“Russo”). Further, insofar as what might be sought is a departure from amounts of child support presently payable under a child support assessment by the Registrar, this Court does not, in the State of Western Australia have jurisdiction to make such an order: Williams at [52]-[59] per Lucev FM.
It follows that the Court does not have jurisdiction to make the orders sought in the Notice of Appeal, insofar as the Notice of Appeal seeks orders for a stay or orders directing that certain administrative actions be taken, or orders that there be a departure from any amounts of child support presently payable under a child support assessment.
Procedural fairness
Mr Hyde complains that he was not afforded procedural fairness in relation to the making of the DPO. As a matter of law, there is no requirement to afford a person procedural fairness prior to making a DPO: Whittaker & Anor v Child Support Registrar & Anor [2010] FCA 43; (2010) 264 ALR 473; (2010) FLC 98-049 at [248]-[249] per Lindgren J (“Whittaker”); and see also Onder v Child Support Registrar & Anor (No. 2)[2011] FMCAfam 430; (2011) 250 FLR 345; (2011) 45 Fam LR 577 at [31] per Monahan FM (“Onder (No. 2)”).
In a discussion with an employee of the Department by telephone before Mr Hyde came to Australia the following was said:
Mr S:You have agreed to pay so you know, whilst your … if you agreed to pay they won’t … they will not put a, they will not put a um a Departure Prohibition Order between when you come back and in and out and in and out. As long as you are making an arrangement to pay it.
Mr Hyde:Ok.
Mr S:But you also … yeah there’s no problem. Ok so let’s see …
Mr Hyde:I mean they understand the situation with talking about this now for months. Ok, great.
Mr S:Yeah alright well look here we go so they have to tell you that they are going to put one anyway. They can’t just sneak one on you. You know I mean you have to be notified.
Mr Hyde’s 25 February 2014 Affidavit at Annexure H1.
The observations made by the employee of the Department in the above telephone conversation are incorrect as a matter of law: Whittaker at [248]-[249] per Lindgren J. Further, the relevant consideration for the purposes of whether or not a DPO ought to issue is whether or not arrangements satisfactory to the Registrar had been made to wholly discharge the child support liability. For reasons set out below the arrangements proposed by Mr Hyde, and said to have been entered into by, or on behalf of, the Registrar, did not constitute an arrangement, satisfactory or otherwise, to wholly discharge the child support liability. Further, and in any event, Mr Hyde did have an opportunity to discuss the possibility of a DPO being made with the Department on 11 November 2013. A transcript of the conversation is annexed to Mr Hyde’s 25 February 2014 Affidavit at Annexure H1. Therefore, even if there were an obligation to afford procedural fairness in relation to the making of the DPO, that obligation was met on the facts of this matter.
Issues on the Appeal
The remaining issues for determination on the Appeal are:
a)whether Mr Hyde had a child support liability as at 13 November 2013;
b)whether the Delegate acting on behalf of the Registrar was satisfied of the matters in s.72D of the Registration and Collection Act and had the requisite belief at the time the Decision was made; and
c)whether there were reasonable grounds for the Delegate to be satisfied of the matters in s.72D of the Registration and Collection Act and to hold the requisite belief.
See Jones at [5] per Emmett J; Williams at [85] per Lucev FM.
In the Appeal, the onus is on Mr Hyde to establish that the DPO was not validly made: Jones at [6] per Emmett J; Williams at [84] per Lucev FM.
Did Mr Hyde have a child support liability?
Child support liability is defined for the purposes of Part VA in s.72E of the Registration & Collection Act, and relevantly, Mr Hyde’s liability in the present case arises under s.72E(a) of the Registration & Collection Act, his liability being a registrable maintenance liability of a kind mentioned in s.17 of the Registration & Collection Act namely a liability:
a)of a parent to pay a periodic amount to a parent carer of the children for the maintenance of the children; and
b)arising under a court order or registered maintenance agreement or is a collection agency maintenance assessment.
The letter of 8 May 2001 from a Regional Child Support Registrar confirms that there was a registrable child support liability: Mr T Affidavit, Annexure A.
The certificate produced pursuant to s.116(2) of the Registration & Collection Act is prima facie evidence of the debt as at 13 November 2013 and shows that Mr Hyde’s child support debt was $44,310.62 (plus penalties of $2,679.23) as at 13 November 2013: Mr T Affidavit, Annexure D.
As at 13 November 2013, Mr Hyde had an amount payable under the registrable maintenance liability which was a child support debt of $44,310.62: Mr T Affidavit at [8], and the day on which this debt became due and payable had passed.
Mr Hyde does not dispute that he has a child support liability, but disputes the amount that is owing: Mr Hyde's Outline of Submissions, page 2. Mr Hyde referred to an application for leave to review past administrative assessments before the Family Court of Western Australia (“Family Court Proceeding”). The Family Court Proceeding is irrelevant to this appeal because the child support liability that existed at the time the Registrar made the DPO is the child support liability which must be taken into account for the purposes of s.72D(1) of the Registration & Collection Act: Albaugh at [27] per Sexton FM; Russo at [26] per Sexton FM.
The Court notes that the Family Court Proceeding culminated in a judgment of the Family Court of Western Australia in Hyde & Hyde [2014] FCWAM 261 (“Hyde”). In those proceedings Mr Hyde sought leave of the Family Court of Western Australia for a departure order from a child support assessment for the period from 1 July 2008 until 10 November 2009, by way of reduced child support for the period 1 July 2008 until 30 November 2008, and thereafter no child support at all: Hyde at [1] per Sutherland M. The Court notes that the Family Court of Western Australia found that Mr Hyde was made bankrupt in (country omitted) in September 2011, and that his employment in (country omitted) was terminated in (omitted) 2014: Hyde at [8] and [9] per Sutherland M. The Family Court of Western Australia did however find that Mr Hyde’s child support assessment had been based on an inaccurate and inflated income amount during the relevant periods, namely 1 July 2008 to 10 November 2009, and ordered that for the period 1 July 2008 to 31 December 2008 Mr Hyde’s child support be assessed on the basis of his 2008 (country omitted) Notice of Assessment (for taxation purposes) and that for the period 1 June 2009 to 10 November 2009 it be based on Mr Hyde’s 2009 (country omitted) Notice of Assessment. Thus, in the period 1 July 2008 to 31 December 2008 Mr Hyde’s real income was $199,200, rather than the figures of $244,160 for the period 1 July 2008 to 22 September 2008, $240,782 for 23 September 2008, and $200,782 for the period 24 September 2008 to 31 December 2008, used by the then Child Support Agency. For the period 1 July 2009 to 10 November 2009 Mr Hyde’s income was $172,519 rather than the $242,769 used by the Child Support Agency. Mr Hyde’s real income during these periods was therefore less than the income taken into account for the assessment of his child support, but the effect of the orders would be to reduce his child support liability, rather than remove it. In oral submissions to the Court Mr Hyde conceded that even if he had been wholly successful in the Family Court Proceeding (which he was not) there would still have been an unpaid child support liability: Transcript, pages 3-4. Thus, even if the Family Court Proceeding was relevant to this Appeal, it would remain the case that Mr Hyde had an unpaid child support liability.
The Court is therefore satisfied that, as at 13 November 2013, Mr Hyde had a child support liability for the purposes of s.72D(1) of the Registration & Collection Act.
Arrangements satisfactory to the Registrar for the child support liability to be wholly discharged
The DPO Submission notes that Mr Hyde had not made a voluntary child support payment between 30 October 2009 and 16 October 2013, when he made a payment of $587.
The child support payer transaction statement shows that:
a)since 17 July 2008, when Mr Hyde last departed Australia, the following child support payments have been made by Mr Hyde:
i)2 payments, each of $2,292, made on 31 July 2008;
ii)a payment of $2,742 made on 7 October 2008;
iii)a payment of $1,487.22 made on 1 December 2008;
iv)a payment of $1,335 made on 1 April 2009;
v)a payment of $990 made on 6 July 2009;
vi)a payment of $4,489 made on 30 October 2009; and
vii)a payment of $587 made on 30 October 2013; and
b)Mr Hyde last had an account that was in balance in 2003 and that the arrears have been steadily accruing since then.
Mr T Affidavit, Annexure C.
Mr Hyde refers to an agreement he believed was in place with the Registrar for payment of arrears by way of instalments of $600 per month. The DPO Submission does not refer to any such agreement. The DPO Submission, accepted by the Delegate, notes that Mr Hyde regularly sent money to Australia in relation to private child support for another child by another wife ($9,150 between 5 January 2012 and 30 October 2013), that private child support not being collectable by the Department, but that Mr Hyde had not made any payments, until he made a single payment of $587 on 30 October 2013, toward his statutory child support liability collectable by the Department since his case ended on 10 November 2009 (after he moved to (country omitted)). The DPO Submission states that there is no satisfactory arrangement in place to discharge the child support liability of $44,310.62.
The transaction statement shows that prior to the payment made on 30 October 2013, the last voluntary payment was made by Mr Hyde on 30 October 2009: Mr T Affidavit, Annexure C, immediately prior to Mr Hyde’s move to (country omitted), a country which does not have a reciprocal child support agreement.
In 2013 there were telephone discussions between Mr Hyde and employees of the Department concerning the making of payments in respect of his child support liability, including the following:
a)a conversation on 20 August 2013 the transcript of which provides in part as follows:
Ms D:…because of the closed case, we can look at your income, what you are currently on right now to work out how much you should be paying towards the arrears amount…
Mr Hyde:Ah no I am not interested in it.
Ms D:Sorry?
Mr Hyde:I am not interested in that. I’m giving you a proposal at $500 a month. What I want to know, because my understanding is I can always go back to Court, so I just want… we’ve got to a stage that the Child Support Agency can’t review this matter and then I just go back to Court. Sum of money is big enough to be worth spending on that. It’s not what my lawyer wants me to do, but um … so what you are saying is because the case is closed ah even though the circumstances, cause this goes back to 2009 when the case was not closed.
Ms D:Yes. So the way we actually work here is we look at the income you are currently on. We do have a guideline that we must collect um you know a certain amount towards the arrears.
Mr Hyde:Yeah but I’m in (country omitted) so I’m not subject to the Child Support Agreement anymore. Um so, so what I’ll do is to, you know cause this call cost me a lot of money. Um what I’ll do is I’ll write to you. I’ll make you this offer of $500 a month, um which is all I can afford at the moment, cause of course I am paying off my debts in (country omitted), um and I will ah ask this … um there is a process of reviewing the sum of money that is outstanding. If you can respond and say “no you can’t do that” then I can just tell my lawyer we go back to Court and review it. Because clearly when, when you go bankrupt you have lots of costs and um I made the CSA well aware of what the issues were in (country omitted).
Mr Hyde’s 25 February 2014 Affidavit, Annexure H1; and
b)a conversation on 13 September 2013, which was referred to in the DPO Submission when considering s.72D(1)(c) of the Registration & Collection Act, and in which the transcript shows that Mr Hyde referred to his previous offer of $500 per month as a “goodwill gesture”. The transcript provides in part as follows:
Ms S:... Um but look as an interim thing while you are getting everything sorted there’s absolutely no reason we can’t accept $500 a month. I guess what they’d be looking at, and this is what we are suppose to look at, is go well this is your income, and we have a whole formula that we go through and look at what your disposable income is.
…
And then we work out what amount our system thinks you can afford for a payment arrangement.
Mr Hyde:Well that’s, that’s, that’s great and, and I told the lady I am a resident of (country omitted), I don’t need to follow that formula. I am paying, for your information $1,500 a month back to the (country omitted) Government and $700 for my daughter in Australia and $500 is all I can afford.
Mr Hyde’s 25 February 2014 Affidavit, Annexure H1.
The agreement alleged by Mr Hyde in relation to a payment of $600 per month arose in a conversation on 16 October 2013 with an employee of the Department. The transcript provides in part as follows:
Mr Hyde:Ah so the iss, the issue is what I, what I proposed at the last phone conversation was accepted verbally, was I will pay $600 a month.
Mr S:Yes.
Mr Hyde:Ah starting from 1st November.
Mr S:Yes.
Mr Hyde:As some …. I want to pay some of this back debt. I am not saying that I don’t have any back debt.
…
Mr Hyde:[referring to an unspecified court order] So he set, he set, he set a rate of …. I actually found the piece of paper, $150 per child and, and then the CSA subsequently changed it upwards again you see.
…
Mr S:… But the thing at least you know where you’re going and that is that your, you’ve got a … you are paying the $600, you have made an agreement to start paying some child support, you can take it to the Court and have that … the, the assessment and because the Agency is happy for you to do that as long as you go through the process of what they say you have got to do they are happy to have that reversed.
Mr Hyde:… I will start paying $600 a month ….
The transaction statement shows that, despite Mr Hyde discussing an interim agreement to pay $500 a month on 13 September 2013, no payment was in fact made until 30 October 2013. No payment of $600 was made on 1 November 2013 or at any time before the issuance of the DPO on 13 November 2013.
The above evidence was sufficient for the Registrar to be reasonably satisfied that there was not a suitable arrangement in place to discharge the whole of the child support liability. It was reasonable for the Registrar to conclude that payment of a debt in excess of $40,000 by instalments of $500 or $600 a month was not a satisfactory arrangement, especially when only one payment had been made in the previous four years, and in the context of Mr Hyde’s threat to return to Court if a payment of $500 per month was not acceptable and the reference by Mr Hyde to not needing to follow the child support liability formula because he was now a resident at (country omitted), which he knew did not have reciprocal child support arrangements with Australia.
The Court is therefore satisfied that there was no arrangement in place at the time the DPO was made, satisfactory or otherwise, for Mr Hyde to wholly discharge his child support liability.
Whether Registrar was satisfied that Mr Hyde had persistently and without reasonable grounds failed to pay his child support liability
Section 72D(2) of the Registration & Collection Act requires the Registrar, in determining satisfaction as to whether Mr Hyde had persistently and without reasonable grounds failed to pay his child support liability, to have regard to the following factors:
a)the capacity of Mr Hyde to pay the debt;
b)the number of occasions on which action has been taken to recover the debt or debts, and the outcome of the recovery action;
c)the number of occasions on which the debts had not been paid on or before the date of which they became due and payable; and
d)such other matters as the Registrar considers appropriate.
The DPO Submission notes that Mr Hyde’s child support account was in balance on 23 October 2003, but that arrears have continued to accrue since that date. The DPO Submission further notes that Mr Hyde’s last voluntary payment was on 30 October 2009, and that he had continued to fail to address his outstanding arrears as the debt became due and payable. The child support payer transaction statement clearly sets out what payments have been paid and when the payments became due.
The letter to Mr Hyde dated 4 October 2010: Mr T Affidavit, Annexure B, confirms that Mr Hyde was advised that even though his child support case had ended due to the residency decision (that is Mr Hyde’s moving to (country omitted)), he was still required to pay the arrears, and was invited to discuss payment of arrears at that time.
In relation to Mr Hyde’s capacity to pay, the DPO Submission notes that:
a)Mr Hyde was employed (at the time the DPO was to be made) by (omitted) in (country omitted);
b)Mr Hyde’s last tax return provided to the Department for the purposes of assessment was for 2008 and showed a taxable income of $242,769 (A$189,773);
c)Mr Hyde's Linked In employment history showed employment in the (omitted) field throughout the relevant period; and
d)an Austrac search showed that Mr Hyde had sent a number of payments to Australia since 5 January 2012, including payments of $9,150 in child support to his second wife, while failing to pay anything to reduce his child support liability collectable by the Department, save for the single payment of $587 on 30 October 2013.
Mr Hyde suggests that his refusal to pay was not unreasonable as he did not have sufficient money to meet all his financial obligations, and therefore followed the “pragmatic” advice of his lawyer that he could not deal with each of the (country omitted) government, the Registrar and his divorce (from his second wife) simultaneously. The Registrar contends that this does not make his failure to pay reasonable, and says that Mr Hyde has chosen to prioritise his other (more recent) financial obligations over his child support debt.
The capacity to pay to be considered by the Registrar is not restricted to the capacity to pay on the day that the DPO is to be issued. The capacity to pay is a factor to be considered in the context of a persistent failure to pay child support liability: Registration & Collection Act: s.72D(1)(c), and therefore the Registrar is entitled to consider whether or not a person had had the capacity to pay the child support liability during the period of failure to pay, not just on the day on which the Registrar looks to issue the DPO. In that context the Registrar was entitled to take into account:
a)Mr Hyde’s payment history, including that his child support account had been in arrears since 2003;
b)the failure to make any payments at all between October 2009 and October 2013 until a single payment of $587 on 30 October 2013;
c)that during that period Mr Hyde had had well-paid and remunerative employment, as demonstrated by his 2008 Income Tax Assessment, and that his Linked In record showed continuing employment in the same industry throughout the period under consideration by the Registrar; and
d)that Mr Hyde had become bankrupt in (country omitted) (a matter noted in the DPO Submission), but that he continued to have the capacity to make payments in respect of a private child support arrangement, and did so in preference to meeting his statutory child support liability, and did so for essentially pragmatic reasons, including on Mr Hyde’s own submissions that it was easier to deal with his second wife and the private child support payment than it was to deal with the statutory child support liability.
In the Court’s view, the Registrar was entitled to conclude that Mr Hyde did have the capacity to pay his child support liability as and when it fell due in the period under consideration, or at the very least for a considerable part of it, but had failed to do so for an extended, and therefore persisting period, from 2003 onwards.
The DPO Submission sets out some of the occasions on which the Department attempted to contact Mr Hyde about his child support and also identifies a number of searches that are relevant to whether there is a viable administrative option open to the Department for collecting the child support liability. Such searches include searches of the records of the Australian Taxation Office and the Department of Immigration and Citizenship, as well as searches of linked in and the internet.
The DPO Submission notes that Mr Hyde’s arrears have been accruing since 2003 as he failed to pay all his ongoing child support. The DPO Submission further notes that, since the case ended with a residency decision that for child support purposes Mr Hyde was a resident of (country omitted) effective 10 November 2009, Mr Hyde has continued to fail to address his outstanding child support arrears.
Annexure HC to Mr Hyde’s 6 February 2014 Affidavit contains two examples of account statements that were sent to him in June and July 2013, providing an outstanding balance expressed to be due immediately. This confirms that Mr Hyde was, or at least ought to have been, aware of his obligation to pay his child support liability.
A number of administrative searches were conducted, as referred to in the DPO Submission. Those searches were obviously done for the purpose of assessing the possible effectiveness of administrative or legal action to recover Mr Hyde’s outstanding child support liability.
Mr Hyde suggests that the Registrar ought to have taken additional administrative steps, such as issue a letter of demand. The Registrar submits that such a step would be inappropriate in this case, as it could be seen as an “empty threat” it not being practicable to follow the letter of demand with the legal action usually threatened in the event that the demand is not met. The Registrar notes that s.72D(2) of the Registration & Collection Act requires that other attempts to enforce the debt be taken into consideration, but does not specify that any particular steps must be taken in order for a DPO to be made. The Registrar submits that the steps taken were appropriate in the context of the present case.
In all the circumstances, the Court is of the view that the Registrar had regard to the number of occasions on which action had been taken to recovery the child support debt, and the outcome of that recovery action, and the number of occasions on which the child support debt had not been paid on or before the day on which they became due and payable. Mr Hyde’s suggestion that a letter of demand ought to have been written by the Registrar to him does not assist the matter. Assuming for present purposes that the Registrar might have regard to action not taken to recover the child support debt, the Registrar would have been entitled to take the view that the issuance of a letter of demand to Mr Hyde would have been futile in circumstances where he was living in (country omitted) which does not have a reciprocal child support agreement with Australia, and there is no evidence that there were any legally enforceable steps which might be taken to facilitate recovery of the child support debt for so long as Mr Hyde remained in (country omitted).
In the circumstances the Court is satisfied that the Registrar had regard to the matters referred to in s.72D(2)(b) and (c) of the Registration & Collection Act.
It does not appear that there were any other matters that the Registrar considered appropriate to have regard to for the purposes of s.72D(2)(e) of the Registration & Collection Act.
Taking into account the various factors referred to above, the DPO Submission concluded that Mr Hyde had persistently and without reasonable grounds failed to pay child support as it became due and payable. The Decision was made in accordance with the DPO Submission. The Registrar submits that the Delegate was satisfied of the factors in s.72D(1)(c) and in considering this ground, appropriately took into account the factors set out in s.72D(2) of the Registration & Collection Act, and that the above matters provide reasonable grounds for the Registrar to be satisfied that s.72D(1)(c) of the Registration & Collection Act was met.
Having regard to the matters considered by the Registrar, and for the reasons otherwise set out above, the Court is satisfied that the Registrar was entitled to be satisfied that Mr Hyde had persistently and without reasonable grounds failed to pay his child support debts.
Desirability of making a DPO
The requirement that the Registrar be satisfied that it is desirable to make a DPO has been considered in previous cases. In Whittaker at [291]-[292] per Lindgren J the Federal Court, said:
[291]...Generally speaking, the terms of s 720(1) show that a DPO is intended to "ensure" that a person does not depart from Australia without either wholly discharging his or her child support liability or making arrangements satisfactory to the Registrar for its discharge. While a DPO is not security in a proprietary sense, it is security in a broader sense of procedure designed to prevent recovery being frustrated.
[292] It may be that the present submission is intended to distinguish between a purpose of preventing a particular imminent departure from Australia and a more general prevention of any departure from Australia. In my view even the latter is within para (b) of s.720(1). That is to say, that paragraph is satisfied if the Registrar believes on reasonable grounds that it is “desirable” to make the DPO for the purpose of “ensuring” ... that the person does not depart at any time in the future from Australia for any foreign country without first discharging the child support liability or making arrangements satisfactory to the Registrar for its discharge.
The approach adopted in Whittaker was followed in Onder (No. 2).
The DPO Submission notes that Mr Hyde had a history of overseas travel and sets out immigration records that show that the last time Mr Hyde was in Australia prior to his present stay in Australia was in July 2008. The DPO Submission concludes that in the absence of alternative administrative or legal options for collecting the debt, the making of a DPO was considered desirable.
The Registrar submits that the consideration of this factor, which was adopted by the Delegate, is sufficient to show that the Registrar considered this ground and had the requisite belief for the purposes of s.72D(1)(d) of the Registration & Collection Act.
In the Court’s view the absence of a reciprocal child support agreement with (country omitted) makes meaningful enforcement action against Mr Hyde while he is in (country omitted) exceptionally difficult. That absence, together with the paucity of payments made by Mr Hyde towards his child support liability while he has been residing in (country omitted) made it reasonable for the Registrar to be satisfied that the DPO was desirable to ensure that appropriate arrangements were made for the discharge of the child support liability.
Was the Registrar satisfied of the s.72D factors?
The Decision to make the DPO shows that the Delegate considered that ‘all four of the provisions are satisfied in accordance with [s.72D]’, namely that Mr Hyde:
a)had outstanding child support arrears;
b)had no satisfactory payment arrangement to wholly discharge his child support liability;
c)had persistently and without reasonable grounds failed to pay child support debts; and
d)was reasonably expected to leave Australia, and had a history of overseas travel.
There were in the Court’s view, for reasons set out above, reasonable grounds for the Registrar to therefore be satisfied as to the factors set out in s.72D of the Registration & Collection Act.
Conclusion and order
For the reasons outlined above the Notice of Appeal is dismissed. There will be an order accordingly.
The Court will hear the parties as to costs.
I certify that the preceding sixty-eight (68) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev
Date: 25 November 2016
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