Kersey and Child Support Registrar (Child support)

[2021] AATA 1296

Kersey and Child Support Registrar (Child support) [2021] AATA 1296 (10 March 2021)

DIVISION:Social Services & Child Support Division

EXTENSION APPLICATION

NUMBER:2020/MC020449

APPLICANT:  Mr Kersey

OTHER PARTY:  Child Support Registrar

TRIBUNAL:J Thomson

DECISION DATE:  10 March 2021

APPLICATION:

An extension application made on 14 December 2020 asking the AAT to consider the application for AAT first review of a decision of the Child Support Registrar on 22 June 2020 despite the period for applying for review having ended.

DECISION:

The extension application is refused.

CATCHWORDS

CHILD SUPPORT – application for extension of time – no satisfactory explanation for the delay – no merit – prejudice to other party – not in public interest – extension of time refused

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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.

STATEMENT OF REASONS

1. Mr Kersey and [Ms A] are the parents of [Child 1], born 2015. [Child 1] is recorded as being in the primary care (86%) of [Ms A] and the regular care (14%) of Mr Kersey.

2. Mr Kersey seeks an extension of time to apply for review of an objection decision made by the Child Support Agency (CSA) on 22 June 2020 (the objection decision).This decision partially allowed Mr Kersey’s objection to a CSA decision dated 17 February 2020, terminating the effect of an earlier objection decision of 11 September 2019 from 31 January 2020, and determining the incomes of the respective parents, and Mr Kersey’s child support liability as follows:

   ·for the period 1 February 2020 to 31 December 2021, Mr Kersey’s adjusted taxable income (ATI) is set at $220,000;

   ·for the period 1 February 2020 to 31 December 2021, [Ms A]’s ATI is set at $200,000; and

   ·for the period 1 February 2020 to 31 December 2021, $4,000 is added to the annual rate of child support otherwise payable by Mr Kersey (in recognition of his contribution to child care costs for [Child 1]).

3. The objection decision set aside the CSA decision of 17 February 2020, and, in substitution, decided as follows:

   ·for the period 1 February 2020 to 31 March 2020, the income used in the assessment for Mr Kersey is $206,978;

   ·for the period 1 April 2020 to 30 September 2020, the income used in the assessment for Mr Kersey is $39,000;

   ·for the period 1 October 2020 to 31 October 2021 the income used in the assessment for Mr Kersey is $124,891;

   ·for the period 1 February 2020 to 16 April 2020, the income used in the assessment for [Ms A] is $52,800;

   ·for the period 17 April 2020 to 31 July 2020, the income used in the assessment for [Ms A] is $36,088;

   ·for the period 1 August 2020 to 31 August 2020, the income used in the assessment for [Ms A] is $66,044; and

   ·for the period 1 September 2020 to 31 October 2021, the income used in the assessment for [Ms A] is $115,136.

4. The Tribunal considered Mr Kersey’s application for AAT first review dated 19 November 2020, on the papers on 5 March 2021, and had before it copies of documents provided by the CSA, Exhibit 1, including, relevantly, Mr Kersey’s summary of his reasons for his application and his written submissions as to his reasons for his delay in lodging his application for AAT first review dated 16 January 2021.

5. The legislation relevant to this application is contained in the Child Support (Registration and Collection) Act 1988 (the Registration Act), and the Administrative Appeals Tribunal Act 1975 (the AAT Act). The relevant provisions are summarised below.

6. Although not clearly identified in Mr Kersey’s application to the Tribunal, it is clear from his summary of his reasons, and his submissions regarding his delay in lodging his application for AAT first review, that the decision he is seeking to have reviewed, for which he sought extension of time to do so, is the objection decision referred to above. It is also apparent from these documents that the substance of his case on appeal relates to the objections officer’s determination of his incomes to be applied in the child support assessment for the periods referred to above, in particular for the period 1 February 2020 to 31 March 2020, which included a payout of $154,922 he received in December 2019 from a company from which he voluntarily resigned in June 2019.

7. Mr Kersey’s written submissions of 16 January 2021, setting out his explanation for today in lodging his application for AAT first review does not identify the date upon which he received notification from the CSA of the objection decision. However, a CSA diary note of 25 August 2020 contained in Exhibit 1 records Mr Kersey contacting a CSA officer, [name], on that date to discuss his reasons for lodging an income estimate. The file note also records a discussion regarding an earlier request by Mr Kersey on 5 March 2020 that all future CSA letters be issued via the post. Mr Kersey complained that his request in this regard had been ignored.

8. The file note records the CSA officer acknowledging that there had been an error on the part of the CSA in failing to comply with Mr Kersey’s request, and undertaking to print off the number of documents, including documents relating to the outcome of the objection decision, and concludes with a note recording that Mr Kersey was to go online to read through those documents, now that he knew they were there.

9. The Tribunal considers it reasonable to infer from this evidence that it was unlikely that Mr Kersey received the CSA’s letter of 22 June 2020, notifying him of the objection decision of that date, and his right to apply for AAT first review of that decision within 28 days of his receipt of that letter. However, in light of the CSA file note of 25 August 2020, the Tribunal considers it is reasonable to infer that by on or about that date, Mr Kersey had received the CSA letter of 22 June 2020 and a copy of the objection decision. He therefore had until on or about 21 September 2020 in which to lodge his application for AAT first review, which he did not do.

10. Section 91 of the Registration Act provides that, if the period for applying for AAT first review has ended, a person may make application for AAT first review that includes a written application (the extension application) requesting the AAT to consider the application for AAT first review despite the ending of the period for applying for review. The extension application must state the reasons for the person’s failure to apply for the review within the period.

11. The established cases indicate that the starting point 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 and Community Services [2004] FCA 297 per Spender J). Spender J quoted McHugh J in Gallo v Dawson (1990) 64 ALJR 459 (Gallo) 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…

12. In line with Wilcox J’s survey of cases in Hunter Valley Developments P/L v Cohen (1984) 3 FCR 344, the Tribunal proposes to consider the matters identified in Gallo under the following headings:

    ·the explanation for the delays;

    ·the merits of the substantial application;

    ·any prejudice to the other party, including any prejudice in defending proceedings occasioned by the delays; and

    ·any public interest considerations that might flow from a successful application, including “the unsettling of other people… or of established practices”.

Explanation for the delay

1. Mr Kersey’s explanation for his delay of approximately 84 days (21 September 2020 to 14 December 2020) is set out in his written submissions of 16 January 2021. He makes reference to feelings of anxiety and dread in dealing with the CSA, its decisions simply beyond reasonable. He cited multiple challenging situations with which he was dealing, including mental health issues, the adverse effect of the COVID-19 pandemic on his children and his business and his employees, for which he was receiving professional counselling to help manage these issues, including an ongoing difficult situation with [Ms A]. However, no supporting medical evidence was provided, and, in the penultimate paragraph of his submissions, he notes that:

   with full lockdown over, business is starting to pick up again and I find myself in a slightly better position, and having some capacity to deal with the situation which has now come to a head with Child Support.

2. The Tribunal considers that, whilst the circumstances Mr Kersey identifies in his submissions are set out above, these are circumstances which confront most parents in day-to-day life, and there was nothing in his evidence to suggest that he was physically incapacitated to the extent that he was not able to function normally. The contact made with the CSA officer on 25 August 2020 suggests that he was able to discuss the prospects of submitting an income estimate, and address the CSA’s failure to comply with this request to forward its correspondence to him by surface mail.

3. The Tribunal also notes that Mr Kersey lodged a further application for change of assessment on 30 May 2020 on the grounds that the child support assessment was unfair because of the parents’ income, property and financial resources, (the ground commonly referred to as Reason 8A), which was subsequently refused by the CSA’s delegate, [on] 29 June 2020, following a number of unsuccessful attempts to contact Mr Kersey to discuss his application between the date of the objection decision on 22 June 2020 and 29 June 2020. Copies of diary notes of the CSA’s attempts to contact Mr Kersey, and its delegate’s decision refusing this further change of assessment application on 29 June 2020, appear in the material comprising the CSA’s documents, Exhibit 1. It seems reasonable to conclude that Mr Kersey was aware of the impending objection decision, and that, by at least on or about 21 September 2020, he had received notification of the decision and was capable of lodging an application for AAT first review with the CSA within time.

4. The Tribunal finds that Mr Kersey has failed to provide a satisfactory explanation for his delay in lodging his application for AAT first review within time, and the lengthy delay in his doing so approximately 84 days suggests he has rested on his rights.

Merits of the substantial application

1. Although Mr Kersey provided a brief statement of his reasons for seeking review of the objection decision, the focus of his complaint was the objections officer’s inclusion in his assessable income for the period 1 February 2020 to 31 March 2020 of the payout of $154,922 he received in December 2019 from the company with which he was associated as a director and shareholder up until his resignation in June 2019.

2. The Tribunal has scrutinised the objections officer’s reasoning in the objection decision regarding the determination of his income for this particular period, based on the evidence provided by Mr Kersey, including his estimated income from the new business he registered on 10 October 2019 of between $50,000 and $75,000 per annum, the financial resource represented in the payout he received in December 2019 of $154,922, amounting to income and financial resources totalling $186,172 for the period 1 July 2019 to 31 March 2020, grossed up to $206,978. The Tribunal finds the objections officer’s methodology in reaching this determination to be appropriate and sound.

3. The objections officer’s determination of Mr Kersey’s income at $39,000 for the succeeding period, during which his evidence was that his receiving only jobkeeper payments of $1,500 per fortnight during the COVID 19 lockdown period 1 April 2020 to 30 September 2020, appears to be appropriate and unremarkable.

4. There was no evidence before the objections officer upon which a determination of Mr Kersey’s income for the post COVID-19 period, 1 October 2020 to 31 October 2021, could be made, and the objections officer’s determination of his income in accordance with his 2018/19 ATI of $124,891 does not seem unreasonable. In any event, it is open to Mr Kersey to lodge a change of assessment application for that period, if he be so advised. The Tribunal notes Mr Kersey’s concluding remarks in his 16 January 2021 submission suggest his business is starting to pick up, following the conclusion of the full lockdown in Victoria.

5. Taking these factors into consideration, the Tribunal concludes that Mr Kersey’s prospects of success in the substantial application would be extremely poor.

Prejudice to [Ms A]

1. [Ms A] is entitled to rely on the decision made by the objections officer on 22 June 2020 and expect certainty and finality. The Tribunal considers that the granting of an extension of time for Mr Kersey to apply to the AAT for review of the objection decision would prejudice [Ms A] and would not be in the best interests of justice.

Public interest considerations

1. Parliament has seen fit to set a 28-day time limit for the lodgement of objections so parents (and the CSA) can act with certainty as to the outcome when the objection period has elapsed. The public has an interest in reviews of decisions made by the CSA being performed in a timely fashion and in a manner that ensures all applicants are treated fairly and equally. Accordingly, the extension of time for an objection is not to be automatically granted.

2. The Tribunal has found that Mr Kersey does not have a reasonable explanation for the delay in applying to the AAT for review of the objection decision of 22 June 2020. The Tribunal has also found that he would have poor prospects of success in the substantial application, and concludes that the interests of justice are best served by refusing to grant an extension of time.