KB and SK - [2005] FMCAfam 104

FEDERAL MAGISTRATES COURT OF AUSTRALIA

KB & SK

[2005] FMCAfam 104

CHILD SUPPORT – Administrative assessment – departure application – father claims obligation to support step children – grounds relied on in sections 117(2)(a)(i), 117(2)(a)(iii)B and 117(2)(c)(ii).

Family Law Act 1975
Child Support (Assessment) Act 1989

Bienke v Bienke-Robson (1997) FLC 92-786
Falcone and Falcone of 3 December 2004 [Appeal No SA63 of 2003]
Gerges and Gerges (1991) FLC 92-204
Humphries v Humphries (1993) FLC 92-430
In the Marriage of Gyselman (1992) FLC 92-279
In the Marriage of Hides and Hatton (1997) 21 Fam LR 855; FLC 92-759
In the Marriage of JM and PJ Bryant 20 Fam LR 575
Vick v Hartcher (1991) FLC 92-262

Applicant:

Respondent:

File No:

PAM 3233 of 2004

Delivered on:

11 March 2005

Delivered at:

Parramatta

Date of Last Submission:

22 February 2005

Hearing date:

21 December 2004

Judgment of:

Sexton FM

REPRESENTATION

Counsel for the Applicant:

Mr G Thistleton

Solicitors for the Applicant:

Lamrocks Solicitors

Counsel for the Respondent:

Ms J Haughton

Solicitors for the Respondent:

Elrington Boardman Allport

ORDERS

That the application for departure from a child support assessment filed by the father on 24 June 2004 be dismissed.
All outstanding applications be otherwise dismissed.
All exhibits tendered in these proceedings be returned at the expiration of one calendar month unless an appeal is lodged.
The solicitor who issued any subpoena collect that subpoenaed material and return it to the owner within seven (7) days.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PARRAMATTA

PAM 3233 of 2004

Applicant

And

Respondent

REASONS FOR JUDGMENT

Introduction

These proceedings commenced with an Application filed by KB (the Applicant father) on 24 June 2004 for a departure order from an administrative assessment of child support for the period 1 January 2003 to 31 December 2005 and for the periods to 20 June 2008. The Applicant father filed an amended application on 16 December 2004. The father filed a Minute of Orders sought at hearing on the day of hearing. The orders sought at hearing were significantly different from the orders sought in his amended application as he no longer sought departure orders from earlier assessment periods.
At the commencement of the hearing an issue arose in relation to the Court’s jurisdiction to hear the matter. The question was whether the applicant had fulfilled the pre-requisite procedural requirements for an application for departure to a court. It was submitted by Counsel for the father on advice from his instructing solicitor that this question was canvassed at the time of the interim hearing in these proceedings in August 2004. The court at that time determined the pre-requisite procedures had been completed. Counsel for the mother asked that the matter proceed. I was satisfied the Court had jurisdiction to hear the matter.
The father sought the following orders at hearing:
a)That all arrears of child support be discharged from the date to which they stand paid.
b)That until 30 June 2008 the father pay to the mother for the support of KOBK the sum of $200.00 each calendar month.
c)That the child support payable by the father pursuant to order (b) hereof be varied on 1 July each year by multiplying the amount payable by the inflation factor applicable in each child support year as used by the Child Support Registrar.
d)That the Child Support Registrar make whatever alterations are necessary to the Child Support Register to implement these orders.
NOTED
The Child Support Registrar is requested to remit any penalties on arrears of child support.
The mother sought an order that the father’s application be dismissed.
Both parties were represented by Counsel at hearing.

Background

The parties married in September 1991.
The only child of the marriage, KOBK [now 12], was born on 2 June 1992.
The parties separated in August 1994.
The parties entered into consent orders for property settlement on

16 January 1995.
The parties divorced on 6 August 1996.
The father re-married in 1996 and his wife brought three children to the marriage, LBK, born 18 April 1985 (now 19), SBK, born 30 March 1987 (now 17) and CBK, born 19 August 1988 (now 16).
The father and his current wife, NB have a further five children, CBJR born 6 November 1997 (now 7), NBJR born

27 February 1999 (now 5), ZBJR born 10 September 2000 (now 4), KBJR born 27 November 2001 (now 3) and KBJNR born 20 May 2003 (now 1).
The father’s wife is pregnant with the parties’ sixth child expected at the end of August 2005.
The mother re-married in June 1997. There is one child of that marriage EKJR, born 29 January 1998.
The father has had no contact with KOBK since December 1998.

The relevant law in proceedings for child support

Jurisdiction is conferred on this court by Section 99(1) of the Child Support (Assessment) Act1989. Division 4 of Part 7 of that Act governs departure proceedings. Section 3 contains the obligation that parents maintain their children. Section 4 sets out the objects of the Act. Each of the objects needs to be borne in mind when deciding an application under the Act. Section 4(3) of the Act recognises the desirability of parents reaching agreement for the financial support of their children. Sections 114 and 121 identify that the further objects of Divisions 4 and 5 of Part VII include:
a)that the children have their proper needs met from reasonable and adequate shares in the income, earning capacity, property and financial resources of both of their parents and
b)that parents share equitably in the support of their children.
The Full Court of the Family Court in In the Marriage ofGyselman (1992) FLC 92-279 set out a three step process that courts must follow in determining an application for a departure order under s.117. The first step is whether one or more of the threshold grounds in s.117(2) is established. If a ground is established, the next step is whether it is just and equitable within the meaning of s.117(4) to make a particular order. The final consideration is whether it is otherwise proper within the meaning of s.117(5) to make a particular order.
In In the Marriage of Hides and Hatton (1997) 21 Fam LR 855; FLC 92-759 the Full Court held that it is necessary for the Court to undertake the three stage process described in Gyselman for each child support year in respect of which departure is sought. Further, the Full Court also said that regard may be had to the current circumstances of the parties:
By this we mean that not only must the Judge apply the three stage process under Section 117(2), (4) and (5) in relation to the circumstances of the parties as they existed in the child support year in question, but also in relation to the present circumstances of the parties (if at all relevant). For example, it may well be necessary in a particular case in addition to considering the circumstances of the parties in the past child support year in question, also to consider the present capacity of the payer to meet a new assessment, and/or the impact on a payee of any credit in the payer’s favour which might be created by a departure from an assessment for an earlier child support year.
Section 115 provides for applications for departure from administrative assessments in relation to periods beginning on or after 1 July 1992 to be made after an application is made to the Child Support Registrar under Part 6A of the Act. An application under Part 6A is an application to the Registrar for a departure from the assessment. Section 116 creates a further requirement in relation to any decision made under Part 6A on or after 15 December 1998 in relation to child support payable on or after 1 July 1999 whereby no application may be made to a Court for departure unless an objection under Part 6B to that decision, has been lodged by the applicant and determined. An objection must be lodged within 28 days of service of notice of the decision under part 6A. If out of time a person may lodge an objection together with an application to the Registrar for an extension of time.
In this matter, on 21 October 2002 the applicant father applied for a departure from the administrative assessment of child support and sought a decrease in his child support liability. This resulted in an increase in the father’s exempt income amount from 1 January 2003 until 31 December 2005 which reduced his child support liability.
On 10 August 2004 the Court ordered, pending further order, a stay of the operation of the child support assessment on condition that the father paid $200 per month and that until final determination of the matter the collection of any child support arrears be stayed. The father has paid child support of $200 per month in accordance with those Orders.
The father’s child support assessment from the agency for the period

1 March 2005 until 30 November 2005 for KOBK is $7,263.00 annually or $605.25 per month. This is based on an adjusted annual income amount of $40,351.00 after deduction of the mother’s excess income, and the father’s exempt income. For the period 1 September 2004 until 28 February 2005 the father’s annual child support liability has been assessed at $5,218.00 or $434.83 monthly.

Evidence and findings

The father relied on:
·His Amended Application filed 16 December 2004 and Minute of Orders sought filed at hearing.
·His Financial Statement filed 20 December 2004.
·His affidavit filed 15 December 2004.
The mother relied on:
·Her Financial Statement filed 6 August 2004.
·Her affidavit filed 17 August 2004.
The parties were the only witnesses in the proceedings and both were cross-examined. Both parties tendered documents which became exhibits in the proceedings.

Father’s financial circumstances

The father completed his medical training in 1992 and commenced working as an intern in 1993, employed through the RAAF. The father left the RAAF in May 1998. In January 1999 the father worked as a senior resident at NE Hospital and from that year also worked as a locum. In January 2001 the father commenced his employment as a registrar in emergency medicine at NE Hospital. He is currently a Level III Registrar, employed on a casual basis. The father is seeking a fellowship of the College of Emergency Medicine. For over 3 years he has been trying to qualify for admission to the College. The father says he has had insufficient time to devote to his studies while working in two jobs. He has often worked 7 days a week with many shifts in excess of 12 hours. Once he has passed his primary examinations, the father said he will have to reduce his working hours to meet the demands of the 4 year advanced training course to qualify as a specialist in emergency medicine so expects a reduced income. On 20 July 2004 the father received a letter from WAHS regarding his clinical performance. They asked the father to consider working in a full time Registrar position and to consider withdrawing from the primary examination process. The father conceded under cross examination that he would not be able to meet his family’s necessary expenses, including mortgage payments on the income he estimated he would earn during his training period. $75,000 to $80,000 per year. He said he would have to work in other jobs.
In his affidavit sworn 14 December 2004 the father deposed to earning a gross income of approximately $200,000.00 in the 2004 financial year and paying tax of $105,000.00 on that income. He deposed to earning an income of approximately $119,000.00 in the 2003 financial year. He deposed to earning an income of approximately $60,000.00 in the 2002 financial year. Under cross examination the father conceded all these estimates were inaccurate. His actual income for the 2002 year was $90,000.00 [Ex R1], for the 2003 year was $200,684.00 [Ex R1] and for the 2004 year was $232,277.00. All his estimates grossly undervalued his actual income. In his financial statement sworn

22 June 2004 the father deposed to a weekly income at that time of $3,250 per week or $169,000.00 per annum. He conceded under cross examination those figures were wrong. The father agreed his income was $232,277.00 in the 2004 financial year [Ex R1] and his tax less than $100,000.00, but justified the figure deposed to on the basis he had been working less in the January to June period of that year.
In his financial statement sworn 17 December 2004 the father deposed to an annual income of E$197600.00, or E$3800.00 per week, all income being from his salary. He did not explain how he arrived at that estimate. He did not make available any documents to corroborate these figures. The most recent payslips produced by the father related to early March 2004. The father said in evidence he was not aware he was required to provide current financial records. I do not accept this evidence. The father has made a number of applications for departure from child support assessments within the Child Support Agency, has been involved in a number of hearings at the Agency and has read a number of decisions of Agency Case Officers. He would be well aware of the critical importance of accurate financial evidence in proceedings of this kind. I found the father’s evidence as to his past and present income most unsatisfactory. As a result, I have been unable to make a finding about the father’s precise income. I am satisfied the father has an income of a minimum of $3,800.00 per week. This is an income well in excess of the ‘income cap’ of $126,959.00 per annum or $2,441.00 per week.
According to his financial statement, the father’s wife receives $114.00 per week by way of child support and family tax benefit to contribute to these expenses. In accordance with section 117(7)(b)(i) of the Child Support (Assessment) Act 1989, I have not taken the father’s wife’s income into account in assessing the father’s present financial position.
The father put his weekly fixed expenses at $4,647.00 per week [using rounded figures]. This included tax of $2,019.00, mortgage payments of $642.00, insurances of $220.00, car registration of $12.00, personal loan repayment of $88.00, Mastercard of $100.00, child support for KOBK of $100.00 and a bundle of other expenses totalling $1,489.00.

It is not clear to me why the figure of $1,489 was included at No 32 of his financial statement rather than the total figure at No 60. I have assumed some expenses would otherwise have been included twice. The figure at No 33 should be $4,671.73. [the figure deposed to at No. 33 of the statement is incorrect]. The figure at No 31 should be $46.00, not $100.00. The order for the father’s present payment of child support for KOBK was for payment of $200 per month, not $100 per week. The figure for the father’s medical registration fees was included at No 26 and cannot be counted twice. [Cf Ex R5]. On the basis of the father’s figures in his financial statement, with these adjustments, his weekly expenses were put at $4,565.00. This figure included expenses for the father’s step sons SBK and LBK.
The father was cross examined on the expenses listed in his Financial Statement. The father was shown a document which the father said was carefully prepared by his wife as to his family’s expenses in the 2004 financial year which became Exhibit R5 [referred to hereinafter as the father’s spreadsheet]. According to the father’s spreadsheet, the father’s total estimate of expenses for 10 people in the household for the 2004 year was $221,624.94 or $4,262.00 per week. [Ex R5]. This total is significantly lower than the expenses deposed to by the father in his Financial Statement of December 2004. With the exception of the figure included for gifts at $10,000 per annum, the expenses set out in the father’s spreadsheet were largely unchallenged by counsel for the mother. I agree with counsel that $10,000 per annum for gifts for 10 people is excessive given the mother deposed to only $16.00 per week or $832.00 per annum for gifts. I have decided a total expense of $4,000.00 per annum or $77.00 per week is reasonable. This is still a greater amount per child than claimed by the mother. The total expenses for the father according to the spreadsheet is therefore $215,624.00 per annum for 10 people or $4,146.00 per week. Given CBK left the father’s household at the end of the 2004 financial year to live with her father, leaving 9 people in the household, I have reduced that weekly figure by $219.00 per week, the amount claimed for the father’s step son SBK. The weekly expenses I have allowed for the father [including expenses for SBK and LBK] are therefore $3,927.00 per week. Excluding the expenses claimed for SBK and LBK, the figure becomes $3,492.00 per week.
In relation to his mortgage repayment, the father provided no documents to corroborate his assertion as to the balance of the loan or the repayments required. He conceded in cross examination his mortgage balance had increased by $25,000.00 to $400,000.00 since swearing his Financial Statement in June 2004. He said he had refinanced his loan to meet $17,000.00 in liabilities. He conceded that none of these liabilities were included in his June 2004 financial statement. He was unable to explain why. The father then attempted to excuse his failure to produce documents to explain these issues by telling the court he had not had time to collect them. He said he had been working nights and weekends and was served with a subpoena only shortly before hearing. I accept he received the latest subpoena very close to hearing but I do not accept the father was not aware of the importance of making relevant financial documents available to the mother and to the court in a matter requiring close scrutiny of his financial position.
The expenses deposed to in his Financial Statement of December 2004 were markedly different from the expenses set out at Ex R5. On the evidence before me, it is not possible for me to make a precise finding about the father’s weekly expenses. However, given the father’s evidence in relation to his wife’s careful preparation of the family’s expenses for the 2004 financial year, and given many of the expenses set out in that document are the same as the expense for the same items in the father’s financial statement, I have decided to base my estimate of the father’s expenses on the figures set out in Ex R5, rather than the figures in the father’s financial statement. I have however, relied on the expenses for LBK and SBK as separately listed at No 60 of the father’s financial statement as they are not broken down in the Ex R5 document. If the expenses deposed to by the father for SBK and LBK [as well as for CBK who has left the home] are excluded from the total in Ex R5 the father’s weekly expenses for himself, his wife and

5 children are an estimated $3,608.00.
In relation to the father’s assets, an issue arose between the parties as to the true value of the father’s residence. The father would not consent to an agent accessing his residence for the purpose of preparing a market appraisal. [Ex R3]. I am therefore unable to make a finding as to the value of the father’s assets.

Special circumstances – has the applicant shown a ground for departure?

It is the applicant father’s case that he can make out the grounds in Section 117(2)(a)(i), Section 117(2)(a)(iii)B and Section 117(2)(c)(ii) of the Child Support (Assessment) Act 1989. These were not the only grounds set out in his Amended Application filed 16 December 2004, but were the only grounds relied on at hearing and in the written submissions filed on the father’s behalf. In summary, the grounds relied on are as follows:
a)In the special circumstances of the case, the capacity of the father to provide financial support for the child is significantly reduced because of his duty to maintain his wife.
b)In the special circumstances of the case the capacity of the father to provide financial support for the child is significantly reduced because of commitments necessary to enable him to support his step children who he has a duty to maintain.
c)In the special circumstances of the case the administrative assessment would result in an unjust and inequitable determination taking into account the property settlement entered into between the parties for the benefit of the child.

Section 117(2)(a)(i) provides:
that in the special circumstances of the case, the capacity of either parent to provide financial support for the child is significantly reduced because of:
(i) the duty of the parent to maintain any other child or another person
Section 117(2)(a)(iii)B provides:
that in the special circumstances of the case, the capacity of either parent to provide financial support for the child is significantly reduced because of:
(iii) commitments of the parent necessary to enable the parent to support:
B any other child or another person that the parent has a duty to maintain.
Section 117(2)(c)(ii) provides:
That in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:
(ii) because of any payments, and any transfers or settlement of property, made or to be made (whether under this Act, the Family Law Act 1975 or otherwise) by the liable parent to the child, to the carer entitled to child support or to any person for the benefit of the child.
Each of the grounds in Section 117(2) is prefaced by the words, “in the special circumstances of the case”. In Gyselman’s case at 79,065 the Full Court said:
Whilst it is not possible to define with precision the meaning of that term, as a generality it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the Legislature is that the Court will not interfere with the administrative formula result in the ordinary run of cases. In Savery’s case (p77-897), Kay J adopting the view in Phillipe and Philippe (1978) FLC 90-433 in a different context, said that “special circumstances” were “facts peculiar to the particular case which set it apart from other cases”. The approach to the interpretation and application of the particular grounds in s117(2) must be guided by that qualification.

Section 117(2)(c)(ii)

Counsel for the father submitted that this ground related to the father being assessed and accruing arrears as a result of a draw down of his superannuation in 1998. When the father left the RAAF in May 1998 he withdrew his unpreserved lump sum superannuation contribution, accumulated over 9 years. This increased his taxable income [and consequently his child support income] for the 1997/1998 financial year. Counsel referred to paragraph 49 of the father’s affidavit which referred to the child support arrears owed by the father in November 2001. The father said that the arrears resulted from his superannuation drawdown in 1998. Counsel for the father submitted that the resulting debt incurred by the father now had to be managed by the father. He submitted that the mother effectively double-dipped by receiving property in the parties’ property settlement taking into account his superannuation and having the benefit again through child support. Counsel submitted that there would have been a Section 75(2) adjustment in the property settlement as a result of the mother’s ongoing care of KOBK. Counsel for the father further submitted that the mother had the benefit in previous years of negatively gearing an investment property which had reduced her child support income for the purposes of the Agency’s assessment.
Until counsel for the father filed his submissions in reply, there was a degree of confusion as to what section of the Act he was relying on in relation to this ground. There was an obvious error in his original submissions. Counsel for the mother therefore canvassed various possibilities as to which subsection the father was relying on. Counsel for the father subsequently made it clear he relied on Section 117(2)(c)(ii). Counsel for the mother submitted in relation to that subsection, that there was no evidence that property was transferred to the mother for the benefit of KOBK. She submitted that even if the mother had received a Section 75(2) adjustment, of which there is no evidence, there was no evidence before the Court on which to base a finding that the mother received property for the benefit of KOBK, as required by the subsection.
The parties entered into a property settlement by consent on 16 January 1995. The orders provided for each party to retain their respective superannuation entitlements. There is no evidence before me as to the basis on which those orders were made in relation to either contribution or Section 75(2) factors. There was no evidence before me to support a finding that property was transferred to the mother at the time of property settlement for the benefit of KOBK.
I find no relevance in the father’s submission that the mother had the benefit in previous years of negative gearing which had the effect of reducing her child support income. The mother said she sold her investment property in February 1999 and gained no tax benefit after that financial year. The father sought orders at hearing which do not apply to that period.
I find the father has not established a ground for departure pursuant to Section 117(2)(c)(ii).
The father relied on two separate grounds for departure in category (a) of Section 117(2). Subsection (a) of Section 117(2) relates to cases where the capacity of a parent to provide financial support for the child is significantly reduced because of one of the categories referred to in (i) to (iii).The father relied on subsections (i) and (iii).

Section 117(2)(a)(i)

The father submitted he has a legal obligation to support his dependent wife. The father’s wife is pregnant with the parties’ sixth child and has children in her care aged between 1 and 7 years. Counsel for the mother conceded and I accept that it is reasonable in these circumstances for the father’s wife to remain out of the workforce to care for her young family. Pursuant to Section 72 of the Family Law Act the applicant has a legal duty to support his wife in circumstances in which she cannot adequately support herself.
I am satisfied the father has a legal obligation to support his dependent wife. The question is whether the father’s capacity to provide child support for KOBK is significantly reduced as a result of that obligation.
Counsel for the mother submitted that on the basis of his current financial position, the father had the capacity to support his wife as well as KOBK. The father’s wife’s expenses were put at $268.00 per week in the father’s financial statement of December 2004. This equates to close to $14,000.00 per annum. The wife’s expenses were not challenged by counsel for the mother. I am satisfied her expenses are reasonable.
In finding the father’s income to be a minimum of $3,800.00 per week and his expenses, including those of his wife to be an estimated $3,492.00 per week, I am satisfied the father is able to support his wife without significantly affecting his capacity to meet his child support obligations. His wife, in any event, is taken into account in the formula assessment as part of the father’s exempt income for the first “relevant dependent child” [Section 39(1)(b) of the Child Support (Assessment) Act 1989]. It is not clear to me why Senior Case Officer LB of 3 December 2002 decided to increase the father’s exempt income by $7,857.00 as a result of his duty to support his wife.
I find the father has failed to establish a ground for departure pursuant to Section 117(2)(a)(i) of the Act.

Section 117(2)(a)(iii)B

The father submitted his capacity to provide financial support for KOBK was significantly reduced because of his necessary commitments to enable him to support his two step sons who he has a duty to maintain. To establish this ground for departure the duty must be existing at the time of the assessment sought to be altered.
LBK was born on 18 April 1985 and is now nearly 20 years. LBK is at university full time. SBK was born on 30 March 1987 and is now almost 18 years. The father said SBK was due to start university full time this year. CBK was born on 19 August 1988 and is now

16 years. Until mid 2004 LBK, SBK and CBK lived with the father’s family. The father has already paid $11,310 in orthodontic expenses for LBK, SBK and CBK. CBK has moved to her father’s home to live. The father’s wife receives child support for SBK from SBK’s biological father. The father deposed to that ceasing on 30 March 2005, SBK’s 18^th birthday. The father said the mother received no financial support for LBK from his biological father, nor has his wife sought any financial assistance from him to assist either LBK or SBK during their tertiary education years. The father said that as his wife was not earning an income, he had a duty to continue to meet all expenses for LBK and SBK.
The father deposed to LBK’s expenses at $219.00 per week and to SBK’s expenses at $216.00 per week. LBK’s expenses included a figure of $72 per week for his car expenses. There was no explanation as to why other expenses for SBK were higher than those for LBK.
The father has no legal duty to maintain his step-sons. The father has not adopted SBK or LBK, nor is there any order in existence to create such a legal obligation for the father to support either of his two step-sons. Counsel for the father nevertheless submitted that the father does have a duty to maintain LBK and SBK pursuant to Section 117(2)(a)(iii)B. There have been two interpretations by the Family Court of the word “duty” as it is used in the Child Support (Assessment) Act 1989. Counsel for the father relied on two decisions of Justice Kay where His Honour gave a broad meaning to the word “duty”. Counsel referred to the decisions of Gerges and Gerges (1991) FLC 92-204 which referred to a duty to support another person arising under the Family Law Act. Kay J said at 78,395 that:
“a person may have a duty to support another person even if that duty is not a legal obligation, but is a mere moral obligation or an obligation which one ought or is bound to comply with. The support of elderly parents in an appropriate case, the support of siblings in an appropriate case, the support of foster children in an appropriate case, can in my view, come within the definition of persons whom a party has a duty to maintain.”
Counsel for the father also referred to the decision of Bienke v Bienke-Robson (1997) FLC 92-786 in which Justice Kay pointed out the difficulty of applying the principle of Vick v Hartcher (1991) FLC 92-262 in child support cases. In Vick v Hartcher the Full Court considered the words “duty to maintain” as it appeared in Section 66K(1)(b)(ii) of the Family Law Act and concluded the phrase was limited to a legal duty, expressly disapproving the decision in Gerges. Kay J restated his view in Gerges in the later case of Humphries v Humphries (1993) FLC 92-430. Neither Counsel referred me to the Full Court decision of Falcone and Falcone of 3 December 2004 [Appeal No SA63 of 2003], an appeal from a decision of Justice Watt concerning an application by a father for variation of a child support agreement. In that case, the parties had one child, Claire, the subject of the child support agreement. The father had married again. His wife, Helen, had two children from a previous marriage and one child born of her marriage to the father, Sebastian. The evidence before Justice Watt was that the father had provided financial assistance to his parents and to his wife’s two children of her previous marriage. Kay J said at paragraph 34:
“His Honour was entirely correct in indicating that the father’s support of his own parents and of Helen’s children, no matter how honourable in the circumstances, could not relieve him of his obligations towards his own daughter Claire.”
Warnick and Holden JJ said at para 79:
As well, the father met school expenses for his new wife’s

2 children in respect of whom he had no liability.
Counsel for the father further contended that full time tertiary students must be supported by their parents if their parents are of sufficient means. In late 2003 LBK’s application for Youth Allowance was rejected. It was submitted for the father that LBK’s application was rejected because of the father’s income. He argued that it followed that the father has a legal obligation to support LBK. He said the father will shortly be in the same position in relation to SBK.
The Social Security Act 1991 as amended does not impose a legal obligation on a parent or step-parent to support a child of any age. However, I am asked to infer a legal obligation on the father to support LBK as a result of the parental income test reducing his entitlement to Youth Allowance to nil. I do not accept this submission. The systems of child support and centrelink are entirely different. The Child Support (Assessment) Act1989 concerns the legal obligations of a parent to support his or her children, as defined in the Act. The Social Security Act1991 concerns a safety net to provide for those left unsupported after all other means of support have been exhausted. Although it may be that the father feels a moral obligation to assist his step-sons, such an obligation cannot be met at the expense of his legal obligation to support his biological children. The fact LBK’s application for Austudy was rejected as a result of a parental income test does not mean that parent has a legal obligation to support him. It simply means LBK will have to find other means of supporting himself, perhaps by asking for assistance from his biological father, perhaps by earning income himself, perhaps by deferring his studies until he can afford to meet his own expenses, or by some other means.
There is no evidence as to the capacity of LBK and SBK’s biological father to provide them with financial assistance. There is no evidence as to the efforts made by LBK or SBK or their capacity to assist in their own support. The father gave no explanation as to why LBK and SBK were not working. He said at hearing that LBK was looking for work. Counsel for the father submitted it was open to me to find LBK could work to an extent, though there is no evidence before me as to what work he could do, or how much he could earn. I have decided it is not necessary for me to decide how LBK and SBK are to be supported during their tertiary years.
While I accept the father may feel a moral obligation to assist with SBK and LBK’s support I find the father’s choice to support SBK and LBK cannot relieve him of his obligation to support KOBK. Accordingly, I find the father has not established a ground for departure pursuant to Section 117(2)(a)(iii)B.
As the father has not established a threshold ground for departure, his application must be dismissed.
The stay order will now be discharged. The father will have accrued arrears of child support as a result of this decision. At the time of his stay application, the father would have been aware of the possibility of his substantive application being unsuccessful. It will now be necessary for the father to make arrangements to pay those arrears.

I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of Sexton FM

Associate: Collette McFawn

Date: 11 March 2005