Joanne Quarrell and Secretary, Department of Social Services Laura Morris

[2015] AATA 724

Administrative Appeals Tribunal

ADMINISTRATIVE APPEALS TRIBUNAL                  )

)No: 2015/0098

General Division  )

Re:  Joanne Quarrell

Applicant

And:  Secretary, Department of   Social Services

Respondent

And:  Laura Morris

Other Party

CORRIGENDUM

TRIBUNAL:Miss E A Shanahan

DATE:18 September 2015

PLACE:Melbourne

The Tribunal directs the Registrar, pursuant to subsection 43AA(1) of the Administrative Appeals Tribunal Act 1975, to alter the text of the decision in this application as follows:

In paragraph 6;

delete ... Mr Quarrell was said to have waived his to FTB payments as he was not paying child support to Ms Quarrell. The payment of child support did not commence until 2014. and replace with

... Mr Quarrell was said to have waived his to FTB payments and he was not paying child support to Ms Quarrell. The payment of child support did not commence until 2010.

[sgd]................................................................
  Member

Quarrell and Secretary, Department of Social Services (Social services second review) [2015] AATA 724 (17 September 2015)

Division	GENERAL DIVISION
File Number	2015/0098
Re	Joanne Quarrell
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT
Other Party	Laura Morris

Decision

Tribunal	Miss E A Shanahan, Member
Date	17 September 2015
Place	Melbourne

The Tribunal sets aside the decision under review and in substitution restores the decision of the authorised review officer of Centrelink dated 19 September 2014 regarding the levels of care for each child, with the exception of the eldest child whose percentage of care was 10 percent at the most during the period under review.

The Tribunal remits the matter to the Respondent to determine the payment due to the parties.

The Tribunal notes there have been major changes in the percentage of care of the children in question during 2015 that will impact on further reviews and determinations by Centrelink.

[sgd]........................................................................

Miss E A Shanahan, Member

SOCIAL SECURITY – family tax benefit – percentage of care for children – no agreement in effect regarding care and/or custody – record keeping issues – credit of parties – failure of other party to appear – decision set aside

Legislation

Social Security Act 1991
Social Security (Administration) Act 1999
A New Tax System (Family Assistance) Act 1999
A New Tax System (Family Assistance) (Administration) Act 1999
Guide to Family Assistance Law 

Cases

Re Paxton and Secretary, Department of Social Services and Anor [2014] AATA 387
Re Warne and Secretary, Department of Family and Community Services and Indigenous Affairs and Anor [2006] AATA 159

REASONS FOR DECISION

Miss E A Shanahan, Member

17 September 2015

1. On 19 September 2014 a Centrelink authorised review officer (ARO) made a decision about Mrs Morris’s percentage of care of Ms Quarrell’s five biological children. Mrs Morris was advised of the ARO’s decision on 23 September 2014.  Mrs Morris was unhappy with the ARO’s decision and sought review of that decision in the Social Security Appeals Tribunal (SSAT). Mrs Morris was successful in the SSAT.  On 17 December 2014 the SSAT assessed Mrs Morris’s percentage of care of Ms Quarrell’s five biological children at levels higher than those determined by the ARO.  Not surprisingly, Ms Quarrell lodged an application for review of the SSAT decision by the Administrative Appeals Tribunal (AAT) on 6 January 2015.   

2. The hearing of this matter was originally listed for 2 July 2015 with a delayed starting time of 11.00am to accommodate both Ms Quarrell and Mrs Morris, who were driving from Warrnambool to Melbourne on the day.  At approximately 7.00am on 2 July 2015, Mrs Morris emailed the Respondent’s legal representatives to advise she would not be attending.  The Respondent notified the Tribunal at approximately 9.30am.  I adjourned the hearing as based on the documentation I perceived that much of the evidence went to the credit of the witnesses. 

3. A new hearing was set down for 22 July 2015. The Tribunal explained to both parties that the assessment of credit was relevant in the circumstances and both needed to appear in person.  On 21 July 2015 Mrs Morris again advised the Tribunal that she would not attend but stated she had no objection to the hearing proceeding without her.

4. At the hearing on 22 July 2015 Ms Quarrell was self-represented and Ms K Latta, a solicitor with Sparke Helmore appeared for the Respondent. The Tribunal was provided with the documents filed pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (the AAT Act). (the T‑documents and ST-documents) Ms Quarrell who gave evidence before the Tribunal tendered

   ·her calendar entries from January to December 2014 – Exhibit A1;

   ·an email dated 22 July 2015 regarding percentages of care – Exhibit A2

   ·calendar entries of 2015 regarding percentage of care – Exhibit A3 and

   ·letters in support of her application and percentage of care claims – Exhibit A4

5. Ms Latta on behalf of the Respondent filed:

   ·the T and ST-Documents – Exhibit R1

   ·the other parties documentation – Exhibit R2 and

   ·the Respondent’s comparison data of the conflicting claims – Exhibit R3.

   background to the application

6. Ms Quarrell is the biological mother of five children, three of whom are the biological children of Mr Dan Quarrell.  Ms Quarrell received child support payments from the biological fathers of her eldest and her youngest child.  The youngest child’s father sees his daughter when he is visiting Victoria.  All five children refer to Mr Quarrell as Dad. 

7. Mr and Mrs Quarrell separated in 2006 and divorced in 2008.  The actual date has not been provided to the Tribunal.  Mr Quarrell entered into a relationship with Mrs Morris in either 2008 (according to Ms Quarrell) or 2013 according to other documentation.  Mrs Morris and her former husband fostered three sibling children from their infancy.  In 2013 the status of these three foster children changed to that of permanent care provided by Mrs Laura Morris; and thereby attracted family tax benefit payments (FTB).  Mrs Morris had worked full time as a financial adviser prior to 2013 and as a result has specialist knowledge of family assistance legislation and FTB payments.

8. In late 2013 or early 2014 Mrs Morris gave birth to a son, Carter.  Mr Quarrell is said to be Carter’s biological father.  The Tribunal has used the phrase said to be as no proof of paternity such as a birth certificate has been provided.  Mrs Morris is said to have been on maternity leave since Carter’s birth and in January 2015 gave birth to a daughter.  Mrs Morris’ current work status is unknown but she is said, by Ms Quarrel, to still be on maternity leave.

9. In October 2013 Mrs Morris consulted Centrelink regarding FTB payments for the shared care of Ms Quarrell’s five children.  Mrs Morris provided an anticipated care program with percentages estimated for all five children.

10. Prior to Mrs Morris’ lodgement of  a claim,  of which Ms Quarrell was unaware, Ms Quarrell had received  FTB payments for 100 per cent care of each of the five children.   In addition, she had qualified for a large family supplement.  Mr Quarrell was said to have waived his right to FTB payments as he was not paying child support to Ms Quarrell.  The payment of child support did not commence until 2014. 

11. There were, and still are, no court orders regarding the custody and care of the children, or formal agreements between the parties as to their care. According to Ms Quarrell, care is dictated by the children’s fluctuating decisions and preferences.

12. Ms Quarrell has kept a diary relating to her care of the children since January 2014 and continues to do so.  Mrs Morris commenced her diary in October 2013 and has provided ongoing documentation up to September 2014.

13. In her evidence to the Tribunal, Ms Quarrell said she had discussed the situation with Mrs Morris on 21 July 2015 and Mrs Morris wanted a set arrangement and was prepared to deal.

14. On the evidence before the Tribunal, there has been a change in the care arrangements of the children since early 2015.  This change has not yet been fully reflected in claims notifications to Centrelink.

15. In January 2015 Mrs Morris gave birth to her second child, a daughter.She now appears to have two children under the age of two years.  Mrs Morris has had problems with one of the former foster children now in her permanent care,  and this child has now been placed in alternative foster care.

16. In January 2015 Mr Quarrell established himself in a private business as a plasterer and according to Ms Quarrell his business has expanded rapidly and he is now working full time.  He is no longer available to pick up the children from school or to provide additional care to that provided by Mrs Morris.

17. Ms Quarrell’s now teenage daughter/daughters have accessed and read the T-documents in this matter and as a result have reduced the time they spend at Mrs Morris’s home.  As of February 2015, Ms Quarrell’s eldest child, her son, has spent more time at her home although on her diarised figures this only amounts to 22 percent of his total care.  This male child is now 18 years and 4 months of age and is undertaking his VCE at Emmanuel College in Warrnambool.  Mr Quarrell is paying this boy’s school fees of $3,000 per annum for the first time.

18. Throughout the period under consideration, Ms Quarrell has paid all school fees for all five children totalling $12,000 per annum and has also paid for school excursions, sporting registration and  extracurricular activities such as football, netball and music.  Ms Quarrell is the nominated contact for all of the children at their schools and attends all school functions.  The statements provided by the class teachers and  primary schools in Koroit and secondary schools in Warrnambool verify Ms Quarrell’s evidence.

19. Ms Quarrell’s claim that if the care was estimated on an hourly basis rather than nights spent with each claimant, then she would qualify for a higher FTB percentage of care appears to be supported by her diaries, particularly in 2015.  In 2015 her son is frequently at her home during daylight hours but returns to Mrs Morris’s home later in order to sleep and in readiness for school the following day. 

20. Both parties have filed supporting statements from relatives and friends.  Ms Quarrell’s supporting statements are subject to a s 35 Confidentiality Order with respect to the names of the authors of the statements.  These essentially confirm her evidence before the Tribunal. 

21. Mrs Morris’s supporting declarations all state she cares for four of the children, Brodyn, Baylie, Dayna and Milla, and more often than not for Layla, on Friday, Saturday and Sunday nights and half of the school holidays.  One of the authors states that Ms Quarrell picks the children up on Monday mornings and takes them to their various schools.  Mr Morris, the ex-husband of Mrs Morris, has based his statements on his observation during his visits to Mrs Morris’s home to pick up the three foster children who are in his care Friday and Saturday nights and returned to Mrs Morris on Sunday evenings.  If this pattern is accurate, Mrs Morris has, until recently, had the care of 10 FTB children – the five Quarrells, her own two and the three foster children – on Sunday nights.

22. Several statements refer to the participation of Mrs Morris and Baylie Quarrell in netball training and competitions on a weekly basis.  Dayna now only trains in Koroit.  Milla, now aged 10, has also begun playing netball and trains in Warrnambool on Wednesday and plays in Koroit on Sundays.  Generally, when the children are training or playing netball in Warrnambool they stay with Mrs Morris; but when these activities occur in Koroit they are at home with Ms Quarrell. 

    evidence before the tribunal

23. Ms Quarrell’s evidence has been summarised under BACKGROUND TO THE APPLICATION.  Ms Quarrell freely admitted that Mrs Morris and Mr Quarrell did have all five children in their care more frequently in 2013 to 2014 but she states things have changed since September 2014.  This possibly reflects the fact that Mr Quarrell has established his own business as a plasterer, is now quite busy and thus not at home with Mrs Morris as frequently as before to assist her with child care.  Ms Quarrell informed the Tribunal she had notified Centrelink of the change in percentage of care in 2015.

24. In her evidence Ms Quarrell said she didn’t know whether her children who attend Emmanuel College in Warrnambool would be coming home for the night until the school bus arrived in Koroit. Mrs Morris often texted Baylie and/or Dayna while they were at school inviting them to stay the night with her. 

25. Ms Quarrell told the Tribunal that the children were often delivered to her home at or after 9.30pm after their weekend stays at Mrs Morris’s home.  This was particularly so when she had notified Mr Quarrell or Mrs Morris that a fee was due at school the following day.  She did not know whether these times were reflected in Mrs Morris’s claims for having the children in her care, that is, nights spent in her care.  According to Ms Quarrell, she had all five children on 11 May 2014, contrary to Mrs Morris’s claim, as this was Mother’s Day and she had insisted that all children be in her care on that day.  According to Ms Quarrell, Mrs Morris has a Health Care card and the children Layla and Brodyn who have no biological relationship to Mrs Morris or Mr Quarrell both appear on that Health Care card and also on the Medicare card.  All five children appear on Ms Quarrell’s Medicare card. 

26. Ms Quarrell said she had sought the advice of a family law solicitor on 31 March 2014 and again on 13 January 2015 in an effort to obtain Court Orders regarding percentage of care for the children or to arrange a legal determination as to care in some form or other but she was not eligible for legal aid and could not afford the fees quoted.

    relevant legislation

27. Section 21 of the A New Tax System (Family Assistance) Act 1999 (Family Assistance Act) provides that a person is eligible for FTB if they have at least one FTB child, is an Australian Resident and the person’s rate of FTB is greater than nil.

28. A person is not eligible for FTB according to s 21(1), s 22(7), s 25 of the Family Assistance Act if the person has care of a child for less than 35 percent of the particular period. 

29. Section 35B provides that where a child is in the care of two people, each of whom is eligible for FTB, the Secretary must determine the adult’s percentage of care for the child during the care period.

30. Section 22(1) and 22(3) of the Family Assistance Act provide that the Secretary must be satisfied that there has been or will be a pattern of care over the care period and that the percentage of care must correspond with the actual care of the child. 

31. Section 35J of the Family Assistance Act provides that the care period may be worked out based on the number of nights that the Secretary is satisfied the child was or will be in the care of the individual during the care period.   The interpretation of the method of calculating the percentage of care and other factors such as rounding down and rounding up are also the subject of assessment in the Guide to Family Assistance Law. 

32. Ideally, the care period should be one of 12 months but it may be less where care is unsettled and changes on a regular basis. 

33. The definition of an FTB child varies according to the age of the child.  Section 22 of the Family Assistance Act provides that:

    22  When an individual is an FTB child of another individual

    (1)An individual is an FTB child of another individual (the adult) in any of the cases set out in this section.

    Individual aged under 16

    (2)An individual is an FTB child of the adult if:

    (a)the individual is aged under 16; and

    (b)the individual is in the adult’s care; and

    (c)the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult; and

    (d)the circumstances surrounding legal responsibility for the care of the individual are those mentioned in paragraph (5)(a), (b) or (c).

    Individual aged 16‑17

    (3)An individual is an FTB child of the adult if:

    (a)the individual has turned 16 but is aged under 18; and

    (b)the individual is in the adult’s care; and

    (c)the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult; and

    (d)the circumstances surrounding legal responsibility for the care of the individual are those mentioned in paragraph (5)(a), (b) or (c); and

    (e)the individual is a senior secondary school child.

34. The legal responsibility with the individual is address in s 22(5) which states:

    Legal responsibility for the individual

    (5)The circumstances surrounding legal responsibility for the care of the individual are:

    (a)the adult is legally responsible (whether alone or jointly with someone else) for the day‑to‑day care, welfare and development of the individual; or

    (b)under a family law order, registered parenting plan or parenting plan in force in relation to the individual, the adult is someone with whom the individual is supposed to live or spend time; or

    (c)the individual is not in the care of anyone with the legal responsibility for the day‑to‑day care, welfare and development of the individual.

    SUBMISSIONS

35. Ms Quarrell did not make formal submissions but relied on the evidence she had presented and her written responses to the SSAT decision. 

36. Ms Latta submitted that the Respondent’s role was to assist the Tribunal in reaching the correct or preferable decision and in so doing she provided a great deal of information and percentage of care figure estimates amassed since October 2013.  Miss Latta had very kindly analysed the data and identified some areas where the claimed care figures of the two parties were in conflict.  In general, there was little  conflict but problems do arise from the fact that Ms Quarrell had not kept a diary of the time the children spent in her care, that is overnight care, between October 2013 and January 2014 and Mrs Morris has not provided any similar evidence regarding her level of care of the children since the end of September 2014. 

37. Ms Latta had analysed the data from October 2013 until the end of October 2014.  The care relating to Brodyn, now over 18 years of age, was not challenged by Ms Quarrell.  She accepted Mrs Morris’s figures up to and including September 2014.  In relation to Dayna, there was on the evidence provided by the two women a 15 night difference; for Baylie there was a 59 night difference; for Milla there was a 14 night difference and for Layla there was a 7 night difference. 

    TRIBUNAL DELIBERATIONS

38. It is not disputed that Ms Quarrell’s children are FTB children, that Mrs Morris also provides care to all five and both women attract FTB payments, although the eldest child is now over 18 but still in the last year of secondary schooling.

39. There are no Court Orders relating to custody and or care and no written agreements between the parties regarding care.  Until Mrs Morris went on maternity leave a loose arrangement had existed for several years whereby Ms Quarrell’s five children spent weekends (unless they had other set engagements) and up to half of the school holidays with Mr Quarrell and Mrs Morris.  Neither Mr Quarrell nor Mrs Morris had applied for FTB payments for these five children in that time. Mrs Morris has stated she applied as of 5 October 2013, as that was the date she and Mr Quarrell commenced living together.  Ms Quarrell has challenged this date, giving evidence on oath that Mrs Morris and Mr Quarrell had been living together for approximately five years and that the 5 October 2013 date corresponded to her going on maternity leave for the birth of her son Carter. 

1. Mrs Morris had been working fulltime as a financial adviser and her knowledge of FTB was far greater than that of Ms Quarrell’s.  From 5 October 2013 Mrs Morris kept records of the nights she had or anticipated having care for these five children in addition to the three foster children who in that same year changed to permanent care and thus also attract FTB payments.

2. Ms Quarrell did not maintain any records or provide anticipated care information in percentages until 1 January 2014, having learned of Mrs Morris’s claim lodged on 22 November 2013.  Ms Quarrell did not and has not challenged Mrs Morris’s claims for the percentage care of her children between 5 October 2013 and 1 January 2014, as she had not kept any records herself.

3. Since 1 January 2014 each woman has provided Centrelink with their anticipated percentage of care of the children.  Ms Quarrell has paid back the debt she attracted in relation to FTB and School Kids Bonuses (this is the name given to the payment by the Government and attracts capitals referred to as SKB) and child support, albeit with great financial difficulty.  These debts totalled approximately $5,800 and she told the Tribunal than an additional approximately $3,000 may be owed pending the result of this review process.

Ms Quarrell’s calculations from 1 January 2014 – 31 December 2014		Days
Dayna	68%	248
Baylie	57%	205
Milla	69%	249
Layla	75%	272

1. Forms were submitted to Centrelink by one or other party in November 2013, January and March 2014.  On each occasion the other party challenged the figures presented to Centrelink.  Centrelink officers made decisions regarding the percentage of care on 27 March 2014, 4 April 2014 and 19 September 2014, the latter being the reviewable decision made by an ARO. 

2. Mrs Morris appealed to the SSAT for review of the ARO’s decision and on 17 December 2014 the SSAT found in her favour to the extent that they increased her percentage of care of the five children.  These figures were to apply from 5 October 2013 to 19 September 2014.  The SSAT relied on Mrs Morris’s figures only in calculating the percentages of care.  The SSAT hearing was conducted by telephone and both Mrs Morris and Ms Quarrell gave evidence in a hearing that lasted one hour.  The Tribunal notes that in its decision the SSAT (paragraph 4) quoted the Centrelink decision of 4 April 2014 regarding the percentage of care as being those of Mrs Morris when in fact they are those of Ms Quarrell.  Ms Quarrell has sought review of the SSAT decision by the AAT.

SSAT calculations from 5 October 2013
Child	Care percentage Mrs Morris	Care percentage Ms Quarrell
Brodyn	87%	13%
Dayna	41%	59%
Baylie	63%	37%
Milla	42%	58%
Layla	35%	65%

1. While a 12 month care plan agreement is favoured by Centrelink, and it is accepted that the calculations should be based on nights spent with each carer, it is possible to base the calculation on lesser periods and even on hours of care.  In this matter the Tribunal has been told that the children are the ones who decide where they will be staying.  Ms Quarrell lives in Koroit, Mrs Morris and Mr Quarrell live in Warrnambool.  These two towns are approximately 17 kilometres apart.  The eldest three children Brodyn (now aged 18), Baylie (nearly 14), Dayna (now 15) are attending Emmanuel College a secondary school in Warrnambool and Milla (now 10) and Layla (now 7) attend a Catholic primary school in Koroit.  All five children participate in f football, netball and/or music lessons. 

   ·In Re Warne and Secretary, Department of Family and Community Services and Indigenous Affairs and Anor [2006] AATA 159, Deputy President Hack adopted as appropriate those decisions of the Tribunal considering the proportionality of FTB payments on the basis of financial as well as temporal factors.  The Tribunal notes that Ms Quarrell has provided evidence that she pays all the children’s school fees totalling $12,000 per annum, with the exception of Brodyn’s fees in 2015 which Mr Quarrell is paying.  Ms Quarrell also pays the children’s sporting club registration and fees for games, such as $7.00 per netball game, for school excursions, entertainment and school lunches. And where such fees have been due at the school on a day following a stopover at Mrs Morris’s home, the children have frequently been returned to Ms Quarrell’s home at 9.30pm the night before the payment is due. 

2. Given the children’s schooling and sporting activities and the distance between Ms Quarrell and Mrs Morris’s residences, fluctuating care plans are to be expected.

3. Mrs Morris was given every opportunity to attend and give evidence before the Tribunal but cancelled with short notice on two occasions.  The Tribunal has found Ms Quarrell to be a witness of truth and has difficulty accepting Mrs Morris’s claimed percentages of care in light of the fact that she has had at least 9 and for some period of time 10 children in her care with five of them (the three foster children and her two biological children) being 100 percent in her care. 

4. The ARO, in reaching her decision of 19 September 2014, has taken into account all the factors in operation from January 2014 except for financial factors.  Ms Quarrell paid for all five children’s school fees, extracurricular activities and lunches for example, whether or not these fell on days when the children were in her sole care.  These financial factors should be considered in determining any debt owed to the Commonwealth.

ARO calculations
Child	Care percentage Ms Quarrell	Care percentage Mrs Morris	Date
Brodyn	10%	90%	5 Oct 2013
30%	70%	1 Jan 2014
20%	80%	31 Mar 2014
Baylie	55%	45%	5 Oct 2013
Dayna	55%	45%	5 Oct 2013
67%	33%	1 Jan 2014
ARO calculations (continued)
Child	Care percentage Ms Quarrell	Care percentage Mrs Morris	Date
Milla	55%	45%	5 Oct 2013
67%	33%	1 Jan 2014
Layla	67%	33%	5 Oct 2013
55%	45%	3 Nov 2013
67%	33%	1 Jan 2014

1. The Tribunal sets aside the decision under review and restores the decision of the ARO dated 19 September 2014.  The matter is remitted to the Respondent to reassess the FTB payments based on changed or changing percentages of care from September 2014 onwards.  The Tribunal directs this reassessment based on Ms Quarrell’s evidence to the Tribunal and Mr Morris’s letter of 10 January 2014 i(n which he states he regularly cares for the three former foster children (now  classified as in permanent care) on Friday and Saturday nights, although Centrelink determinations have assigned 100 percent of care to Mrs Morris for these three children). No doubt the reassessment will result in amounts owing to the Commonwealth but that is a matter for the Respondent.

I certify that the preceding 45 (forty‑five) paragraphs are a true copy of the reasons for the decision herein of:  Miss E A Shanahan, Member

[sgd]........................................................................

Administrative Assistant

Dated   17 September 2015

Date of hearing	24 July 2015
Applicant	In person
Advocate for the Respondent	Ms Kellie Latta, Sparke Helmore