Langford and Secretary, Department of Family and Community Services and Anor

[2004] AATA 1134

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 1134

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No W2004/144

GENERAL ADMINISTRATIVE  DIVISION		)
Re		LARS LANGFORD

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

First Respondent

And            STEPHANIE JENKINSON

Second Respondent

DECISION

Tribunal Ms L Savage Davis, Member

Date29 October 2004

PlacePerth

Decision

The Tribunal:

(i) sets aside the decision of 28 October 2002, and, in substitution, decides that for the period 2001/2002 the applicant was entitled to receive Family Tax Benefit at a rate of 10%;

(ii) affirms the decision of 16 December 2002 to raise and recover an overpayment of Family Tax Benefit for the period 1 July 2002 to 8 August 2002.

............(sgd L Savage Davis).............

Member

CATCHWORDS

Family Tax Benefit – whether payable to the applicant – percentage entitlement – overpayment – recovery or waiver

A New Tax System (Family Assistance) Act 1999 s21, s 22, s 58, s 59

REASONS FOR DECISION

29 October 2004 Ms L Savage Davis, Member        

1.      This is an application by Mr Lars Langford (“the applicant”) for review of a decision of the Social Security Appeals Tribunal (“SSAT”) on 8 April 2004 to affirm the decision of a Centrelink delegate of the Secretary, Department of Family and Community Services (“the first respondent”) made on 28 October 2002 to raise and recover an overpayment of Family Tax Benefit (“FTB”) paid to the applicant for the 2001/2002 year totalling $2,292.20, and the decision made on 16 December 2002 to raise and recover an overpayment of FTB paid to the applicant for the period 1 July 2002 to 8 August 2002 totalling $135.54.

2. The hearing was held before the Administrative Appeals Tribunal on 11 October 2004. The Tribunal had before it the documents lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (“the T documents – T1-T92”) as well as the first respondent’s Statement of Facts and Contentions filed on 17 August 2004.

3.      The applicant represented himself and gave oral evidence to the Tribunal.  The first respondent was represented by Mr Aaron Holt and the second respondent represented herself and also gave oral evidence to the Tribunal.

Issues

4.      The issue before the Tribunal was whether FTB was payable to the applicant for the 2001/2002 financial year, and for the additional period of 1 July 2002 to 8 August 2002.  If FTB was payable to the applicant, the question arises as to what rate was it payable to the applicant?  Alternatively, if FTB was not payable had the applicant incurred a debt that should be recovered, or waived?

Legislation

5.      The relevant legislation is contained in the A New Tax System (Family Assistance) Act 1999 (“the Act”). Section 58 of the Act provides that a person’s rate of Family Tax Benefit is calculated in accordance with the Rate Calculator contained in Schedule 1 of the Act. Clause 27 of Schedule 1 provides that s 59 of the Act permits FTB to be shared if more than one adult has care of a child. Section 59(1) provides:

“If the Secretary is satisfied that:

(a)       an individual is an FTB child of an individual (person A); and

(b)the FTB child is also an FTB child of another individual who is not person A’s partner;

the Secretary may determine the percentage that is to be person A’s percentage of family tax benefit for the child.”

6. Section 25 of the Act states:

“25 (1) If:

(a)the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual in accordance with subsection 22(2), (3), (4), (5) or (6); and

(b)one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and

(c)the Secretary is satisfied that the child was, or will be, in the care of that last‑mentioned individual for less than 10% of that period;

the child is to be taken, despite that subsection, not to be an FTB child of that last‑mentioned individual for any part of that period.

(1A)     If:

(a)the Secretary is satisfied that there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual in accordance with subsection 22(2), (3), (4), (5) or (6); and

(b)one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and

(c)the Secretary is satisfied that the child was, or will be, in the care of that last‑mentioned individual for not less than 10%, but less than 30%, of that period; and

(d)that last‑mentioned individual, by written declaration given to the Secretary, waives the individual’s eligibility for family tax benefit in respect of the child for some or all of the days in that period;

the child is to be taken, despite that subsection, not to be an FTB child of the last‑mentioned individual on any day covered by the declaration.

(1B)     If:

(a)the Secretary is satisfied that there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual in accordance with subsection 22(2), (3), (4), (5) or (6); and

(b)the Secretary is satisfied that, if one of those other individuals was to make a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period, the Secretary would be satisfied that the child would have been, or would be, in the care of that individual for not less than 10%, but less than 30%, of that period; and

(c)that last‑mentioned individual, by written declaration given to the Secretary, waives the individual’s eligibility for family tax benefit in respect of the child for some or all of the days in that period;

the child is to be taken, despite that subsection, not to be an FTB child of the last‑mentioned individual on any day covered by the declaration.

(1C)If an individual has given the Secretary a written declaration under subsection (1A) or (1B), the individual may, by further notice in writing given to the Secretary, revoke the declaration with effect from a specified day, not being a day earlier than the date of the revocation.”

Therefore, if a person has at least 10% care of an FTB child, then that person will qualify for FTB on the basis of that percentage.

7. Section 21 provides:

(1)       An individual is eligible for family tax benefit if:

(a)the individual has at least 1 FTB child (see section 22 and later provisions); and

(b)       the individual:

(i)        is an Australian resident; or

(ia)      is a special category visa holder residing in Australia; or

(ii)       satisfies subsection (1A); and

(c)the individual’s rate of family tax benefit, worked out under Division 1 of Part 4, is greater than nil.

8. Section 22 relevantly provides:

(1)An individual is an FTB child of another individual (the adult) in any of the cases set out in this section.

(2)…

(3)The individual is an FTB child of the adult if:

(a)the individual is aged under 18; and

(b)a family law order or registered parenting plan is in force in relation to the individual; and

(c)under the order or plan, the adult is someone with whom the individual is supposed to live or someone with whom the individual is supposed to have contact; and

(d)the individual is in the adult’s care; and

(e)the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult.

…

(7)If:

(a)the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual under subsection (2), (3), (4), (5) or (6); and

(b)one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and

(c)subsection 25(1), (1A) or (1B) does not require that the child be taken not to be an FTB child of that individual for any part of that period;

the child is to be taken to be an FTB child of that individual for the purposes of this section on each day in that period, whether or not the child was in that individual’s care on that day.

9. Section 71 of the Act provides that if a person receives FTB that they are not entitled to, the amount of the overpayment is a debt due to the Commonwealth.

10.     The Family Assistance (Administration) Act 1999 provides that certain debts can be waived if, for example, they arose due to administrative error or there are special circumstances present which warrant waiver of the debt.

Considerations of the Issue

11.     It is not in dispute that the applicant and the second respondent are the parents of two children Issaiah and Zachary.  The applicant and second respondent separated in late 1998.  The evidence before the Tribunal is that the children, whilst living with the second respondent, have seen their father on a reasonably regular basis since the separation.

12.      The applicant’s evidence is that following a period where he was denied regular access, he sought legal advice and as a result of that lodged a claim for FTB for 2001/2002 and 2002/2003 on the 13^th August 2002.  As a result, on the 16^th August 2002 he was granted FTB on the basis that he had had 25% care of the children since 1^st July 2001.  As a result he received a lump sum of $2,404.40 for the period 1 July 2001 to 8 August 2002.

13.     As the second respondent had throughout this period been in receipt of a 100% FTB an overpayment of $2,193.03 was raised against her on the 14^th August 2002.  The second respondent appealed this decision and on 14^th October 2002 a Centrelink officer set aside the decision and substituted a decision that she had not been overpaid FTB because of the shared care arrangement under which the applicant provided 25% care for the children did not commence until 9^th August 2002.  As a result an overpayment for the period 1 July 2001 to 30 June 2002, and 1 July 2002 to 8 August 2002 totalling $2,427.74 was raised against the applicant.  The applicant sought a review of this decision which was affirmed by the SSAT on the 8^th April 2004.

14.     The applicant’s evidence to the Tribunal was that throughout the period 1 July 2001 to 8 August 2002 (the period) the arrangement that had been in place since they separated, and which has been documented in a Court Order since August 2002 accurately reflected the amount of time he had the children. That is, he was responsible for approximately 25% of their care throughout the period.  He said there was no dispute about this until an overpayment was raised against the second respondent.

15.     The applicant agreed that following a disagreement in April 2002 the second respondent withheld access and it was this that led him to seek to formalise the acess and complete the documentation that resulted in him being paid FTB at the rate of 25%.  The applicant referred the Tribunal to the Family Tax Benefit Supplement Form for 2001/2002 (T8/21-29) signed by the second respondent, which records that he has had 25% of the care since 1 November 1998.  The applicant denied that he had had no contact with his children between November 2001 and February 2001 following the second respondent’s decision to prevent him seeing the children. 

16.     The applicant could not be sure as to exactly how often he saw the children or any specific dates, but indicated that throughout the period when both he and the second respondent had at times been moving between the city and the country he saw his children wherever possible.  The applicant said that if the children were living nearby he collected them on Friday and dropped them back on Monday at school.  He said this occurred in 2002 when he live in Pingelly or when, for example, the second respondent lived in the city he would come up and collect them on Friday afternoon and drop them back to her Balga home on the Sunday afternoon.  The applicant said that the letter that he had written but had been prepared by his Legal Aid lawyer (T19/68) dated the 26^th April 2002 was incorrect in that it stated that his contact as of late with his children had been irregular.

17.     The second respondent also had difficulty recalling the exact periods that the applicant did see the children regularly.  Her evidence to the Tribunal was that she was certain that the children were not in his care at all from the end of October 2001 until the end of January 2002.  This was because in October her children had gone with the applicant and his then girl friend to Adventure World.  Subsequently the applicant and his then girl friend had had an argument and he and the children had been thrown out of the house that they shared.  Some time later the applicant made up with his girl friend but the second respondent did not feel it was suitable for her children to be with the applicant whilst he was with this girl friend.

18.     The second respondent believed that from the 1^st July 2001 until October 2001 the applicant had generally seen the children every second week-end and for his share of the school holidays.  Again, her recollection of the period from the end of January 2002 until mid April 2002 was unclear.  Whilst she was certain that the children did not see their father for Christmas or New Year, a fact disputed by the applicant, she did tell the Tribunal that he saw them from the end of January to mid April 2002 probably on the basis of the previous arrangement of every second week-end and half the school holidays.

19.     The second respondent said it was not easy to recall the details of contact because both she and the applicant moved a number of times during the period and no records had been kept.  Whilst the second respondent could not recall what occurred to result in the applicant again having access to the children from February 2002 onward she was clear that contact ended on the 18^th April 2002. This was because on a visit to the applicant’s home with his brother on that date, the applicant had asked that the next time the children came to him that she give him $50.  As a result of this she said that the children did not see their father until the document of the 9^th August 2002 was signed, which coincided with the applicant seeing the school psychologist with her in regard to one of the children.  She took this as a positive act on the part  of the applicant and also wished to respond in kind, and that is why she signed the form that led to the applicant being paid FTB at the rate of 25% for the period in question.

20.     The second respondent confirmed that in July, August, September and October 2001 and February, March, until the 18^th April 2002 the applicant had access to the children on the basis of every second week-end and half of the school holidays.

21.     In his final submission the applicant said that his claim for FTB was part of the process he was advised to take to regularise access.  He disputed the second respondent’s evidence that he did not see the children at all between November 2001 and February 2002 and also between April and August 2002.  He said that if he did not see the children during that time it was because the second respondent prevented him from doing so.

22. On behalf of the respondent it was submitted that there was no solid evidence as to the 25% care that the applicant asserted he had from 1 July 2002 to 8 August 2002. The respondent submitted that the overpayment for this period therefore should be affirmed. In regard to the period 2001/2002 the respondent referred the Tribunal to s 25(1)(c) of the Act. Based on the evidence before the Tribunal it was submitted that between 1 July 2001 and 29 October 2001 there were 17 week-ends and 32 days of school holidays. On the basis of the evidence the arrangement of every second week-end and half the school holidays would result in the applicant having the care of the children for 27 days. For the period 1 February 2002 to 18 April 2002, an 11 week period with no school holidays the applicant would have had 11 days of contact. It was submitted this was a total of 38 days which was 10.4% over 1 year. Therefore the applicant satisfied s 25(1) of the Act and should be paid at the rate of 10% for the period, and the second respondent should be paid at the rate of 90% for the period.

23.     The Tribunal is of the view that both the applicant and the second respondent had difficulty in recalling exactly what had occurred for the period in question in regard to the children.  Both at various times told the Tribunal they could not recall, however, there was agreement that when regular access occurred it was on the basis of every second week-end and half the school holidays. 

24.     The second respondent’s evidence has led the Tribunal to conclude that this arrangement occurred in July, August, September and October 2001 and February, March and part of April 2002.   The second respondent has also given evidence that she prevented the applicant seeing the children for the periods of November 2001 until the end of January 2002, and from 18^th April 2002 to 9^th August 2002.

25.     Whilst the applicant disagrees with the evidence of the second respondent that he did not see his children over Christmas/New Year 2001/2002, he did give evidence indicating that there were periods where he did not see the children because he was prevented from doing so.  The Tribunal therefore accepts that throughout those periods the children did not have contact with the applicant.  Whilst there may be a case that it was the second respondent who prevented that access, there is no evidence before the Tribunal that the applicant took reasonable steps to attempt to ensure he had access to his children during this period.

26.     The Tribunal accepts the respondent’s submission that based on those periods where the evidence supports the applicant’s contention that he did have the care of his children, that is 1 July 2001 to 29 October 2001 and February, March and part of April 2002, that this amounted to 10.4%.  As it is customary for percentages of less than .5 to be rounded down, the Tribunal considers it is appropriate here to allocate the applicant’s entitlement as a 10% share for the 2001/2002 period.  Therefore, the Tribunal finds that for the period 2001/2002 the applicant is entitled to FTB at a rate of 10%.  This will result in a reduced overpayment for this period.

27.     For the period 1 July 2002 to 8 August 2002 there is no evidence before the Tribunal that the applicant had the care of the children or took any steps to enforce that access.  Therefore, the decision to raise an overpayment for the period 1 July 2002 to 8 August 2002 is affirmed. 

28.     The decision to raise and recover an overpayment of FTB paid to the applicant for the 2001/2002 year is set aside and in substitution the Tribunal determines that the applicant is eligible to be paid 10% of the FTB in respect of Zachary and Issaiah, and the second respondent is eligible to be paid the remaining 90%.  The decision to raise and recover an overpayment of FTB for the period 1 July 2002 to 8 August 2002 is affirmed.

29. The Tribunal also considered whether the debt that remained should be waived under Division 4 of the A New Tax System (Family Assistance) (Administration) Act 1999.  There was no evidence, however, to support the requirement that there had been any administrative error or that special circumstances existed that would make it relevant to consider these provisions in this case.

I certify that the 29 preceding paragraphs are a true copy of the reasons for the decision herein of Ms L Savage Davis, Member

Signed:         ...............(sgd V Wong).................................
  Associate

Date/s of Hearing  11 October 2004
Date of Decision  29 October 2004
Counsel for the Applicant         In person
Solicitor for the Applicant          Mr A Holt
Counsel for the Respondent     Service Recovery Team, Centrelink
Solicitor for the Respondent    In person