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Kay and Child Support Registrar

Kay and Child Support Registrar

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Case Copied 17 June 2015 63 min read

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[2015] AATA 429

DivisionGENERAL ADMINISTRATIVE DIVISION

File Number 2015/2620
ReJim Kay
APPLICANT

And Child Support Registrar
RESPONDENT

DECISION
Tribunal Deputy President S A Forgie
Dr D Cremean, Senior Member

Date 17 June 2015
Place Melbourne

The Tribunal decides to affirm the decision of the Child Support Registrar dated 28 May 2015 refusing to issue a Departure Authorisation Certificate.

…[sgd] S A Forgie…
Deputy President
CATCHWORDS
CHILD SUPPORT – Departure Prohibition Order (DPO) issued – application for Departure Authorisation Certificate (DAC) – security provided by third party – whether appropriate – security to be given by payer – decision affirmed
LEGISLATION
Administrative Appeals Tribunal Act 1975; section 37
Bail Act 1977 (Vic); section 9
Child Support Assessment Act 1988; sections 3, 4
Child Support (Registration and Collection) Act 1988; sections 4, 17, 17A, 18, 18A, 19, 26, 26A, 26B, 30, 39B, 42B, 44, 47, 65A, 65B, 66, 71, 71A, 71B, 72A, 72C, 72D, 72E, 72F, 72I, 72L, 72M, 72N, 74, 75, 104, 105, 111B, 113, 113A
Commonwealth of Australia Constitution Act (The Constitution); sections 81, 83
Financial Management and Accountability Act 1997; sections 5, 21
Financial Management Legislation Amendment Act 1999; sections 3, 5
Migration Act 1958; sections 12, 13
Property Law Act 1958 (Vic); section 6
Public Governance, Performance and Accountability Act 2013; section 80
Taxation Administration Act 1953; sections 14S, 14U
CASES
Alexandra Private Geriatric Hospital Pty Ltd v Blewett (1984) 2 FCR 368; 56 ALR 265
CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; 141 ALR 618
Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission and Others [2000] HCA 47; (2000) 203 CLR 194; 174 ALR 585
Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297; 35 ALR 151; 11 ATR 949; 55 ALJR 434
Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577; 2 ALD 60
Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24; 66 ALR 299
Nevistic v Minister for Immigration and Ethnic Affairs [1981] FCA 41; (1981) 34 ALR 639; 51 FLR 325
Onder v Child Support Registrar [2011] FMCAfam 430; (2011) 250 FLR 345
Port of Brisbane Corporation v Deputy Commissioner of Taxation [2004] FCA 1232; (2004) 81 ALD 549; 140 FCR 375
R v Australian Broadcasting Tribunal; Ex parte 2HD Pty Ltd [1979] HCA 62; (1979) 144 CLR 45; 27 ALR 321
Re Drake and Minister for Immigration and Ethnic Affairs (No 2) [1979] AATA 179; (1979) 2 ALD 634
Re Eid and Federal Commissioner of Taxation [1998] AATA 73; (1998) 38 ATR 1066
Re Ganchov and Comcare (1990) 11 AAR 468
Re QVRC and Child Support Registrar [2015] AATA 271
Re Wetzell and Child Support Registrar [2005] AATA 607
TCN Channel Nine Pty Ltd v Australian Mutual Provident Society [1982] FCA 169; (1982) 62 FLR 366

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: [2015] AATA 429
Decision Date: 17 June 2015

CaseChat Overview and Summary

The case between Kay and the Child Support Registrar involves a Departure Prohibition Order (DPO) issued against Mr Kay, prohibiting him from leaving Australia due to his outstanding child support liability. Mr Kay applied for a Departure Authorisation Certificate (DAC) to leave the country, which the Registrar refused. The primary dispute centred on the appropriateness of the security offered by Mr Kay, which was a charge over real estate owned by a company in which he was formerly a director. The matter was heard and determined by the court, which affirmed the Registrar's decision.

The key legal issues the court had to decide were whether the security provided by Mr Kay, through a third party, was appropriate as per the requirements of the Child Support (Registration and Collection) Act 1988 (CSRC Act) and whether Mr Kay had satisfied the conditions for a DAC under the Act. The court also needed to determine if there were any humanitarian or national interest grounds that would warrant issuing the DAC despite the security concerns.

The court found that Mr Kay had not provided appropriate security as it could not be given by a third party, and even if it could, it would not have been considered appropriate due to several reasons. Firstly, there were doubts about the Registrar's ability to enforce the charge. Secondly, the charge might not have priority over other charges or mortgages, which could jeopardise its effectiveness. Lastly, there was no evidence indicating that Mr Kay was willing to undergo financial hardship to secure his return to Australia. The court concluded that since Mr Kay had not demonstrated an inability to provide appropriate security, the Registrar was not obligated to issue a DAC under the CSRC Act.

The court affirmed the Registrar's decision, ruling that Mr Kay had not provided appropriate security and was therefore not entitled to a DAC. The Registrar's decision was upheld, and Mr Kay's application for authorisation to leave Australia was rejected.

Orders

Orders of the court

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Background

Background to the litigation

On 13 September 2013, the Child Support Registrar (Registrar) issued a Departure Prohibition Order (DPO) prohibiting Mr Kay from departing from Australia.[1] Mr Kay had, and continues to have a child support liability that he has not discharged and that continues to increase. He applied to the Registrar on 14 May 2015 for a Departure Authorisation Certificate (DAC) authorising him to leave Australia.[2] The Registrar refused his application on the basis that it was unlikely that the DPO would be revoked within an appropriate period and he had not provided appropriate security for his return. Furthermore, the Registrar decided that he was not satisfied that the certificate should be issued on humanitarian grounds or that refusing a DAC would be detrimental to Australia’s national interests. At the hearing, the issues in dispute resolved around the appropriateness of the security offered by Mr Kay. The security he offered took the form of a charge over real estate owned by a company of which his sister is now a director and of which he has been a director in the past. We have decided that he has not given security as required as it cannot be given by a third party and that, even if he had, we would not have regarded it as appropriate security for Mr Kay’s return to Australia. Therefore, we have affirmed the Registrar’s decision and set out our reasons below.[1] See documents lodged under s 37 of the Administrative Appeals Tribunal Act 1975 (T documents); T6 at 19[2] T documents; T20 at 161-172LEGISLATIVE BACKGROUND Part VA of the Child Support (Registration and Collection) Act 1988 (CSRC Act) provides for DPOs. The Registrar may make a DPO prohibiting a person from departing from Australia for a foreign country in the following circumstances:“(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.”[3][3] CSRC Act; s 72D(1) A “child support liability” is defined in s 72E:“For the purposes of this Part, a person has a child support liability if:(a)the person has a registrable maintenance liability of a kind mentioned in section 17 or 17A, 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(b)an amount payable under the registrable maintenance liability is a child support debt; and(c)the day on which the debt became due and payable under section 66 has passed, and the debt remains unpaid in whole or in part.”

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Even if the Registrar has power to take the necessary steps and even if a charge has been given by the person applying for a DAC, we would have doubts whether we would consider it “appropriate” within the meaning of s 72M(1). As Mr McClelland submitted, there is no question that a deed is sufficient to create a charge over real estate without the need for any consideration to be given. We do not doubt that in Victoria the charge could be registered under the Property Law Act 1958 (Vic) (PL Act). Where our doubts arise is in relation to the priority of the charge for it would not have priority over any other deed, conveyance or other instrument registered after it. It would not have priority because priority is only accorded to those:“… deeds conveyances and other instruments in writing as aforesaid, if made and executed bona fide and for valuable consideration and registered in conformity with the provisions of this Act …” (emphasis added)[69] For the reasons we have given, we do not consider that Mr Kay has given appropriate security to the Registrar. It is Combourne Pty Ltd that has offered to give security and, on our understanding of s 72M(1), a third person may not give security on behalf of the person seeking a DAC. Only the applicant for a DAC may give security. Even if Combourne Pty Ltd could give security, we are not satisfied that it is appropriate security for Mr Kay’s return to Australia. Our reasons are threefold. First, there are serious doubts whether the Registrar would have power to enforce the charge. Assuming our doubts are not well founded, the second is this. Even though there is sufficient equity in the property to cover the amount of Mr Kay’s existing child support debt at this time, the assurance that the equity is sufficient to ensure his return could easily lose its gloss were other charges or mortgages given for valuable consideration as they would take priority. Our third reason has already been expressed by Deputy President McMahon in Re Eid and Federal Commissioner of Taxation:“… There is no evidence of any financial impairment which the applicant is prepared to undergo in order to secure the Commissioner’s satisfaction that he will return. I see no reason in logic, nor has any reason been given in the evidence why the applicant should return to Australia simply because four other people, or groups of people, have given security over their assets. … The fact is, that on the face of the proposals, there is nothing before me which would tend to secure the applicant’s return to Australia simply by virtue of the charges given over the four houses.”[70] [70] [1998] AATA 73; (1998) 38 ATR 1066 at [23]; 1071-1072 That means that the Registrar is not obliged to issue a DAC under s 72L(3)(a). Section 72L(3)(b) sets out another set of circumstances in which the Registrar must do so. They raise humanitarian and national interest issues but, before either the Registrar or we are required to consider them, we must be satisfied that “… the person is unable to give such security …” i.e. security under s 72M. We are not in a position to make that finding. All that we have been given is evidence of the deed of charge that Combourne Pty Ltd is prepared to execute over its real estate. Mr Kay did not choose to give evidence. That is his prerogative but we have no evidentiary basis on which we are satisfied that he is unable to give security under s 72M of the CSRC Act. Therefore, we have no basis on which to consider whether he would otherwise be entitled to a DAC under s 72L(3)(b) of the CSRC Act.