Keane and Child Support Registrar (Child support)

[2020] AATA 266

Keane and Child Support Registrar (Child support) [2020] AATA 266 (16 January 2020)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/BC017437

APPLICANT:  Mr Keane

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member A Byers

DECISION DATE:  16 January 2020

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object - no satisfactory explanation for the delay - little merit - weighing all factors the extension of time was correctly refused - decision under review affirmed

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

REASONS FOR DECISION

BACKGROUND

1. This matter concerns whether Mr Keane should be granted an extension of time to lodge an objection to a decision of 30 November 2016.

2. Mr Keane and [Ms A] are the parents of [Child 1] and Mr Keane is the parent responsible for paying child support.

3. On 2 June 2016 [Ms A] asked the Child Support Agency (CSA) to cease collecting Mr Keane’s child support on her behalf on the basis that he was making regular loan repayments on a car he had provided her.  In this regard [Ms A] accepted that three loan repayments Mr Keane claimed on 19 May 2016 and 2 June 2016 were to be credited towards his child support liability.

4. On 25 August 2016 [Ms A] applied to the CSA for collection of Mr Keane's child support liability to be resumed.  [Ms A] also requested the CSA to collect arrears from 2 June 2016.  According to [Ms A] no further payments were required for the car loan and Mr Keane was not making any payments directly to her. 

5. The CSA decided to enforce Mr Keane’s child support liability from the date of application and assessed him as also liable to pay arrears from 2 June 2016.  Mr Keane then requested the CSA to a credit a series of $150 payments made between 13 July and 5 October 2016 towards his child support liability.  The payments totalled $3,150 and are said to be repayments of the car loan. 

6. [Ms A] informed the CSA that she did not accept the payments were for child support and by notice dated 30 November 2016 the CSA informed Mr Keane of its decision to refuse to credit the payments.  The notice was sent to Mr Keane’s nominated address and he does not contest it was received (in the ordinary course of post).

7. Under section 80 of the Child Support (Registration and Collection) Act 1988[1] a person may lodge a written objection to a decision relating to the particulars of an administrative assessment.  Under section 81 the person must lodge the objection within 28 days of being served notice of the decision.  They may, however, apply under section 82 for an extension of time within which to lodge.

   [1] All further references are to this Act unless otherwise stated.

8. On 26 July 2019 Mr Keane lodged a written objection to the CSA’s decision not to credit the claimed payments, together with a request for an extension of time within which to lodge the objection.  Mr Keane’s objection is therefore about two and a half years out of time.

9. By notice dated 17 September 2019, the CSA refused to grant Mr Keane’s request and he sought review by the Tribunal on 18 September 2019.

10.  The matter was heard in Brisbane on 16 January 2020 by telephone and Mr Keane gave sworn evidence.  The Subsection 37(1) Statement and Documents provided by the CSA, comprising folios 1 to 293, are admitted into evidence and marked Exhibit 1.

CONSIDERATION

11.  The Act does not prescribe the matters to consider for an extension of time application.  The starting position is the prima facie rule that proceedings commenced outside a statutory period will not be entertained (Lucic v Nolan (1982) 45 ALR 411 at 416). However, the primary concern “…is to do that which will enable justice to be done between the parties” (see Martinsen v Secretary, Department of Family & Community Services [2004] FCA 297 per Spender J). Spender J quoted McHugh J in Gallo v Dawson (1990) 64 ALJR 459 as follows:

In order to determine whether the rules [imposing time limits] will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time ...

When the application is for an extension of time …it is always necessary to consider the prospects of the applicant succeeding in the appeal …

Merits of the objection

12.  The Act sets out a regime for the periodic collection of a person’s enforceable maintenance (child support) liability.  Outside this regime sections 71 to 71D allow for certain payments to be credited to a person’s enforceable maintenance liability in specified circumstances.  The CSA refers to payments credited in this way as “non-agency payments”.

13.  Section 71A allows for payments made to a third party to be credited towards a payer’s child support liability.  Section 71B allows for the agreed value of transferred property to be so credited.  In both instances the parties must mutually intend that payments, or the agreed value of property, be credited.  

14.  Mr Keane signed a loan contract with ()[Bank 1] (which subsequently became [Bank 1]) on 30 April 2010 for the purchase of a used [Vehicle 1].  The amount loaned was $32,998.35 and was secured against the car.  The purchase price of the car is unknown.  However, [Bank 1] made the following disbursements:

Amount  Destination

$20,949.35  Account no.[number deleted]
$9,050.65  Account no. [Account Number 1]
$2,868.35  [details deleted]

$130  [BANK 1] (administrative costs)

15.  Mr Keane said account no. [Account Number 1] is his personal savings account.  Mr Keane was unable to say why the disbursements were split into two accounts, although an obvious reason would be that the smaller sum was used for other purposes. 

16.  The car was purchased before Mr Keane and [Ms A] partnered, and Mr Keane indicated it was used by both parties prior to their separation in September 2015.  Mr Keane said he then transferred the car to [Ms A] around the beginning of January 2016, although his email of 4 April 2016 (see below) suggests it was on or after 4 April 2016. 

17.  [Ms A] completed a form (CS1650) on 30 May 2016 which relates to the disclosure of non-agency payments.  [Ms A] indicated that she would accept car repayments of $150 per week that Mr Keane was making to [Bank 1] as non-agency payments for the period 25 May 2016 to 1 January 2017.  The CSA informed [Ms A] that anticipated payments could not be included and that each payment would need to be separately disclosed when made. 

18.  At the CSA’s suggestion [Ms A] indicated on 2 June 2016 that she wished to revert to private collection of child support.  The obvious rationale (discussed with the CSA on that date) was that [Ms A] anticipated Mr Keane would continue making car repayments in lieu of child support as a private arrangement and they would be relieved of the burden of repeatedly disclosing this to the CSA. 

19.  As noted, [Ms A] applied to the CSA on 25 August 2016 for collection of Mr Keane’s child support liability to be resumed from 2 June 2016.  [Ms A’s] stated reason for her application was that no further payments were required for the car loan and Mr Keane was not making any payments directly to her. 

20.  According to the CSA, Mr Keane provided evidence that he continued to make payments of $150 per week towards an outstanding loan and the hearing papers contain supporting [Bank 1] statements to 31 August 2016.  However, in file notes of 3 and 22 November 2016 [Ms A] is recorded as stating that she did not agree the continuing payments were for the [Vehicle 1] and that she had evidence to confirm that Mr Keane had consolidated his debts, including credit card debts, into one loan and that the repayments were for that loan.  According to [Ms A] the car itself was unencumbered.

21.  In support, [Ms A] supplied a REVs check report of 25 August 2016.  The report confirms the [Vehicle 1] was at that stage unencumbered.  As the report coincides with [Ms A’s] application for collection of Mr Keane’s child support liability, it strongly suggests her understanding of the arrangement was that payments towards the outstanding car loan were in lieu of child support and that the actual value of the car at the time of transfer was not a consideration.  This is consistent with the form CS1650 she completed on 30 May 2016.

22.  A problem is that the exact nature of the agreement between the parties is unclear and it seems the parties each had a different understanding.  In what appears to be an email from Mr Keane to [Ms A] on 4 April 2016, Mr Keane confirms that he will transfer the [Vehicle 1] to [Ms A] “in place of me paying child support”.  Mr Keane indicates he will continue to make car loan repayments and just prior to the finalisation of the loan in May 2017 he will commence to negotiate (further) child support payments.  The balance of the outstanding loan is not stated and no value is assigned to the car.

23.  Mr Keane said his reason for objecting is that [Ms A] has stated in an affidavit to the Court (in relation to child care issues) that [Vehicle 1] was in lieu of child support.  [Ms A’s] affidavit of 3 June 2019 is scant in detail.  [Ms A] merely deposes that Mr Keane offered her [Vehicle 1] in lieu of child support to use and accommodate her allowing him to see [Child 1].  [Ms A] also deposes that she sold the car in March 2017 as it was having major engine issues she could not afford to have fixed.  I consider this adds nothing by way of further clarification and is really only a broad statement concerning something incidental to the child care issue being litigated.

24.  I can understand Mr Keane’s concern that [Ms A] has essentially received [Vehicle 1] in circumstances where only $450 was credited towards his child support liability and [Ms A] evidently retained the profit from the sale of the car.  However, the issue for child support purposes is whether there was a mutual intention that (any of) the non-agency payments made after 2 June 2016 were in lieu of child support.

25.  I consider it highly probable based on what [Ms A] has already told the CSA that she only intended payments made towards an outstanding loan for [Vehicle 1] to be in lieu of child support.  Thus, [Ms A’s] position would be that any payments made after [Vehicle 1] (which was the security for the original loan) became unencumbered would not count. 

26.  It is unclear exactly when [Vehicle 1] was released.  However, one clue comes from the loan statements Mr Keane provided.   As noted, it appears only $20,949.35 of the total borrowed was for [Vehicle 1] and that $9,050.65 was borrowed for personal use.  As the balance of Mr Keane’s loan as at 2 June 2016 was $9,250, this suggests the car loan (with interest) was already paid out and therefore that the [Vehicle 1] was unencumbered before this point.

27.  My view therefore is that Mr Keane’s prospects of success if an extension of time is granted are very slim on the grounds that [Ms A] could forcefully maintain that she never intended payments made after the car loan was extinguished to count as child support.  As noted, it appears this probably happened before 2 June 2016. 

Explanation for the delay  

28.  As indicated, the CSA sent Mr Keane a notice on 30 November 2016 advising him of its decision not to credit payments totalling $3,150 towards his child support liability.  The notice contained an instruction that any objection should be lodged in writing within 28 days of the date of receipt.

29.  A CSA file note of 30 January 2017 indicates Mr Keane telephoned to enquire about lodging an objection to the decision.  The decision was explained to Mr Keane and he was informed that he needed to lodge the objection in writing and complete a form requesting an extension of time.  The officer undertook to email the form to Mr Keane and he agrees it was received.

30.  Mr Keane indicated he had provided all the documentation already in his possession to the CSA and therefore believed he would need something additional before he could convince the CSA of his position.  Mr Keane said this came in the form of what he sees as an admission by [Ms A] in her affidavit of 3 June 2019 (considered above).  According to Mr Keane, the CSA had never indicated to him that [Ms A] accepted [Vehicle 1] was in lieu of child support. 

31.  This does not strike me as a good reason for a delay in seeking a review of some two and a half years.  As noted, [Ms A’s] deposition on this point was brief and incidental to the matter being litigated.  It also adds nothing to what Mr Keane could have anticipated would be aired during the review process had he objected in time.    

Conclusion

32.  My conclusion is that matters considered indicate that the justice of the case will not be served by granting Mr Keane an extension of time to lodge his objection to the CSA’s decision of 30 November 2016.  The decision under review refusing an extension of time will therefore be affirmed.

DECISION

The decision under review is affirmed