Keller and Child Support Registrar (Child support)

[2020] AATA 4293

Keller and Child Support Registrar (Child support) [2020] AATA 4293 (29 July 2020)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2020/PC019278

APPLICANT:  Mr Keller

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Member S Brakespeare

DECISION DATE:  29 July 2020

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object – no merit in substantive application – 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. Mr Keller is the parent liable to pay child support to Ms [A] in respect of their child [Child 1].

2. On 8 April 2020 an officer of the Child Support Agency decided that from 10 January 2020 Ms [A]’s provisional income of $79,996 would be replaced by her 2018/19 adjusted taxable income of $115,882 (the original decision). Mr Keller lodged an objection to the original decision on 28 May 2020 and an extension of time request on 13 June 2020.

3. On 13 June 2020 an officer of the Child Support Agency refused to grant the extension of time to lodge the objection (the extension of time decision). Mr Keller lodged an application for review of the extension of time decision with the tribunal. A hearing was held on 29 July 2020. Mr Keller gave evidence on affirmation to the tribunal via conference telephone. The Child Support Agency provided the tribunal and Mr Keller with a bundle of papers relevant to the review (98 pages).

4. Relevant aspects of the evidence and material before the tribunal will be referred to in the tribunal’s consideration of the issues which it has to decide.

ISSUE

1. The statutory provisions relevant to this review are the Child Support (Registration and Collection) Act 1988 (the Act) and the Child Support (Assessment) Act 1989 (the Assessment Act).

2. The issue which arises in this case is whether the application for an extension of time to lodge an objection should be granted.

CONSIDERATION

1. Section 80 of the Act provides that a person may lodge an objection in writing to the Child Support Agency to specified decisions made by the Child Support Agency.

2. Section 81 of the Act provides that an objection to a decision must be lodged by a person within 28 days after a notice of the decision is served on the person.

3. Section 82 of the Act provides, in cases where the lodgement period has passed, a person may send an objection along with an extension of time application requesting the Child Support Agency to treat the objection as having been duly lodged. The application must state fully and in detail the grounds of the application, including the circumstances concerning, and the reasons for, the failure by the person to lodge the objection in time.

4. Section 83 of the Act provides that the Child Support Agency must consider and either grant or refuse the application for an extension of time. If the application is granted then the person is taken to have lodged the objection.

5. Section 89 of the Act provides that an application may be made to the tribunal[1] for review of a decision made under section 83.

   [1] AAT first review.

6. The general starting position for extension of time applications is 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, for example, Martinsen v Secretary, Department of Family & Community Services [2004] FCA 297 per Spender J). In Hunter Valley Developments P/L v Cohen (1984) 3 FCR 344, the Federal Court summarised the conditions to be considered before an extension of time will be granted, namely that:

• there should be an acceptable explanation of the delay; and

• it must be fair and equitable in the circumstances. 

1. In determining whether it is fair and equitable to extend time, the Court indicated that relevant considerations will include any prejudice to the parties and the merits of the substantive application. In Comcare v A’Hearn [1993] FCA 498, the Full Federal Court held that, while an acceptable explanation for any delay would usually be expected, this was not a necessary pre-condition to the grant of an extension of time. The tribunal takes the view that, in child support matters where one of the affected parties is the other parent, a failure to have an adequate reason for the delay would work against a finding that granting the extension of time would be fair and equitable.

2. The tribunal will now consider the facts in this case against the matters to which consideration should be given.

Reasons for delay

1. Mr Keller was sent a notice of the decision of 8 April 2020 on 9 April 2020. He acknowledged that he receives such notices electronically. He told the tribunal that he did not pay much attention to that notice, as he and Ms [A] had entered into a Binding Child Support Agreement (the Binding Agreement) on 10 January 2020 and the Child Support Agency had accepted the Agreement on 13 January 2020.

2. Mr Keller said that the terms of the agreement meant that non-periodic payments made by the parents were to be credited against any administrative assessment of child support and would reduce the administrative assessment to nil. He said clause 3.15 of the Binding Agreement meant that the Agreement applies in respect of any administrative assessment that had been or would be made by the Child Support Agency.

3. Mr Keller said that he only became aware that there was a problem when the Child Support Agency issued him with a debt notice for $672.99 on 23 May 2020. He immediately contacted the Child Support Agency to lodge an objection to the debt notice. He was advised that he needed to object to the decision that gave rise to the debt. The decision that gave rise to the debt was a care percentage decision on 18 April 2020 for the period 27 September 2019 to 8 December 2019.

4. Mr Keller said that he did not disagree with the care percentage decision. However he thought that he should not have to pay the arrears because of the terms of his Binding Agreement. The Child Support Agency advised him that the arrears payment was not covered by the Binding Agreement.  He therefore decided to contest the date from which Ms [A]’s 2018/19 adjusted taxable income of $115,882 should have effect.  His reasoning is that her 2018/19 adjusted taxable income was known to the Child Support Agency at the time the reassessment of the care percentage was made; in his view all known factors, including Ms [A]’s actual taxable income, should have been used to make any reassessment fair.

5. The tribunal finds that Mr Keller’s reasons for delay are acceptable.

Prejudice to the other parent

1. The tribunal considered whether granting the extension of time is likely to cause prejudice to the other parent. Given the short period of time that elapsed between when the decision was made, and the extension of time was lodged, combined with the fact that all relevant information is with the Child Support Agency, the tribunal finds that there is not likely to be prejudice to Ms [A].

Merits of the substantive application

1. It is not a requirement in considering an extension application to come to a final view about the substantive application. Consideration should be given to whether the claim has sufficient merit to justify an extension of time.

2. Division 7 of Part 5 of the Act sets out the provisions for the Child Support Agency to determine a person’s adjusted taxable income for a relevant year of income, where there has not been an assessment by the Commissioner of Taxation (referred to by the Child Support Agency as provisional income) and for amending the assessments once the adjusted taxable income is known. The date of the effect of the amending assessment is set out in subsection 58A(2) of the Assessment Act.

3. The tribunal is satisfied that the decision made on 8 April 2020 is in accordance with the provisions of the Assessment Act. There is no basis for backdating the assessment to either the commencement of the financial year as desired by Mr Keller. Therefore, the tribunal finds that the substantive application does not have sufficient merit.

4. Mr Keller told the tribunal he had contacted the Child Support Agency a number of times about Ms [A]’s income being incorrect. In December 2019 the Child Support Agency advised him that he would need to make a change of assessment application to have her provisional income replaced by her actual income; however he did not proceed with the application as the Binding Agreement was in the process of being mediated.

5. Mr Keller is of the view that the Child Support Agency has failed to correctly implement the Binding Agreement. It is his view that the Binding Agreement applies to all administrative assessments made by the Child Support Agency after the date of the Agreement, including assessments for previous child support periods. Mr Keller said that he and Ms [A] went to considerable expense to have a Binding Agreement mediated, and he is frustrated that the Child Support Agency has not implemented it in a manner which reflects the intent of the parties.

6. The tribunal notes that Mr Keller had not lodged an objection to the decisions regarding the Binding Agreement. The Assessment Act sets out, at section 34B, how the administrative assessment is to be made where child support was already payable under an administrative assessment. It states that the assessment applies to the child support period that starts on the day specified in the Agreement, or if no date is specified, the day the Agreement was signed. The tribunal notes that the day specified in the Binding Agreement is the date of execution (that is, 10 January 2020). In the tribunal’s view the Child Support Agency has given effect to the Binding Agreement from the correct date.

Prejudice to the general public

1. The tribunal finds that there would be prejudice to the general public to grant an extension of time where there is insufficient or no merit to the substantive application.

Conclusion

1. The tribunal finds that the extension of time to lodge an objection should not be granted, as the substantive claim does not have sufficient merit.

DECISION

The decision under review is affirmed.