Lilley & Logan - [2009] FMCAfam 868

FEDERAL MAGISTRATES COURT OF AUSTRALIA

LILLEY & LOGAN

[2009] FMCAfam 868

CHILD SUPPORT – Eligible child – child conceived as a result of an act of prostitution.

CHILD SUPPORT – Stay assessment and collection of child support – Application to prevent child support enforcement order.

Child Support (Assessment) Act 1989, ss.18, 19, 22
Family Law Act 1975
Trade Practices Act 1974

Cattanach v Melchior [2003] HCA 38; (2003) 199 ALR 131
Magill v Magill [2006] HCA 51; (2006) 231 ALR 277; (2006) 81 ALJR 254
Re B & J (1996) FLC ¶92-716

Applicant:

MR LILLEY

Respondent:

MS LOGAN

File Number:

MLC 4974 of 2009

Judgment of:

Riethmuller FM

Hearing date:

24 June 2009

Date of Last Submission:

24 June 2009

Delivered at:

Melbourne

Delivered on:

24 June 2009

REPRESENTATION

Counsel for the Applicant:

In person

Counsel for the Respondent:

No appearance by or on behalf of the Respondent.

ORDERS

Pending the outcome of any objection and the outcome of any SSAT decision:
(a)The payment of child support arrears be stayed; and
(b)The payment of the child support assessment be stayed to the extent that it exceeds $100 per week.
All extant applications otherwise be dismissed and the matter removed from the pending cases list.

IT IS NOTED that publication of this judgment under the pseudonym Lilley & Logan is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLC 4974 of 2009

MR LILLEY

Applicant

And

MS LOGAN

Respondent

REASONS FOR JUDGMENT

(As revised from Transcript)

This matter comes before me for judgment as to the issue of whether the Applicant is required to pay, to the Respondent, child support payments and child support arrears pending the outcome of an appeal to the Child Support Registrar and/or the Social Securities Appeal Tribunal. The Applicant also seeks orders to prevent the Child Support Registrar from seeking enforcement of any child support due to the circumstances of the conception.
The facts of this case are somewhat unique. The Applicant alleges that the Respondent was a prostitute. The Applicant argues that the child the subject of the child support claimed by the Respondent was conceived as a result of the Applicant paying the Respondent for sexual intercourse, as part of a commercial transaction.
The Applicant contends that child support should not be payable for a child that was inadvertently conceived as a result of a ‘consumer transaction’, as he puts it. At paragraph 7 of his affidavit filed 9 June 2009, he states:
7. My intention is to now question the very basis on which an assessment is entitled to be made. It is not a question of parentage or of disputing the CSA formula; rather it is a matter of determining whether the foundation for an assessment is fundamentally flawed.
It appears to me that under the Child Support Scheme the relevant matters for determining whether or not a child falls within the scheme, and an assessment should issue, are whether or not a child is a child of the parties. In this case there is no dispute that the particular child, [D], is the biological child of the applicant and the respondent.
In these circumstances prima facie the child is a child who can be the subject of a child support assessment in the form that has issued in this case. Sections 18 and 19 of the Child Support (Assessment) Act 1989 define which children the Act applies to:
18. This Act applies only in relation to children who are eligible children.
19. A child born on or after the commencing day is an eligible child.
‘Commencing day’ is defined under s.5 of Child Support (Assessment) Act 1989
‘the day on which this Act commences’ [which was in October 1989].
Section 22 of the Child Support (Assessment) Act 1989 prescribes the regulations to limit children which fall under the jurisdiction of the Act:
22(1) The regulations may provide that children who are under the care (however described) of a person under a child welfare law are not eligible children.
No regulations relevant to this case have been promulgated.
It is not suggested the child was conceived by means of artificial conception and therefore the relevant provisions of the legislative schemes governing artificial conception do not have a role to play in this case: see s.5 of the Child Support (Assessment) Act 1989 and Re B & J (1996) FLC ¶92-716, per Fogarty J.
The applicant also raises an argument that as the conception occurred during the course of an act of intercourse pursuant to a financial arrangement between he and the mother when the mother was working as a prostitute, there was an implied term to the contract that she would avoid pregnancies and/or there were provisions of the Trade Practices Act 1974 which would have applied or the State Fair Trading Acts to the effect that this was an interaction which would not result in the conception of a child.
There have certainly been cases in the category that lawyers sadly described as "wrongful birth" which have resulted in tortious damages in favour of the persons concerned. Those cases involved medical procedures and the conduct of doctors. That, of course, does not alter the obligations of parents to the child, but generates an independent right against a third party for the recovery of damages; see for example the decision of the High Court in Cattanach v Melchior [2003] HCA 38; (2003) 199 ALR 131.
I also note that the High Court in the case of Magill v Magill [2006] HCA 51; (2006) 231 ALR 277; (2006) 81 ALJR 254 was disinclined to the view that there should be any cause of action as between the parties to a personal relationship for tortious conduct. Whether Magillv Magill [2006] HCA 51; (2006) 231 ALR 277; (2006) 81 ALJR 254 would extend to a case such as the present is perhaps an arguable point given the nature of the relationship between the two parties in this case being one of service provider and client, on the case of the applicant, rather than a personal relationship of spouses or, at the very least, consenting adults in a loving, even if very brief relationship.
Once conception occurs and a child is born, a child is entitled to the support of the parents. The amount of support is determined by a child support assessment under the Child Support Scheme. The antecedents of the conception do not appear to me to destroy a child’s entitlement under the Child Support Scheme and the Family Law Act 1975.
For these reasons I find that the child is properly covered by the Child Support Scheme and properly the subject of a child support assessment.
Whether or not the applicant has an independent cause of action against the proprietors of the brothel or escort service concerned and/or the mother, pursuant to any of the commercial arrangements that he refers to is not a matter that I have to determine in this application which deals solely with the application of the Child Support Scheme to the particular child. To the extent he has any rights to damages, his assessment for child support may be relevant in those independent actions, when assessing the amount of any damages.
As a result, to the extent the applicant challenges the respondent’s right to a Child Support assessment with respect to the child, I dismiss the application.
I therefore turn to the question of whether or not there ought to be a stay on the basis that the applicant has pending before the Child Support Agency an application for departure. In this case the applicant's departure application was summarily determined against him on the basis that he had not established a ground.
It seems to me that he does have at least an arguable case for a ground for a departure in that there is a number of key factors which, when put together indicate that some consideration needs to be given to his circumstances. They are:
a)an informal arrangement had been in place for payment of child support for the child concerned at $100 per week or thereabouts;
b)the applicant lost his job where he was earning $140,000 per annum and had a period of unemployment;
c)he has obtained employment again but on only $80,000 per annum;
d)he has a wife who earns a relatively modest income and a child whom he supports in the household in which he currently lives;
e)his wife is ill and in need of some support; and
f)his financial material indicates that he is at present in significant financial distress as a result of the combined impact of his significant drop in income, a significant increase in child support and the expenses that his household has come to engage in based upon the arrangements that were in place until the last year.
Whether, when taken as a whole, these factors show that there is a proper case for a reduction in child support for a short-term period and some clearing of arrears until such time as is reasonable to allow the applicant to readjust his living arrangements or not seems to me to require some detailed consideration of the actual financial circumstances of each household and exactly what any particular rate of child support and arrears will mean for each of the households in this case.
On the material before me, I have only the evidence of the applicant as to a significant drop in income and significant expenses far in excess of his and his current spouse's income. The material provided by the respondent, although she did not appear at the hearing, did not include any financial information at all from which to assess her circumstances.
In the circumstances in this case I am persuaded that at this stage I should stay the arrears and the current assessment to the extent that it exceeds $100 per week, being the informal rate that had been in place, until such time as either the objections officer or the SSAT can undertake a detailed assessment of the facts and circumstances of the case and form a proper view as to the appropriate rate, both in the shorter and longer terms, in this case.
I make clear that this decision should not be read as requiring any particular outcome, nor indeed indicating what particular outcome is appropriate in this case. Rather that it seems an appropriate course, given the evidence that is before me, to stay the assessment to the extent that it exceeds $100 per week until such time as a proper and detailed hearing can be held with both parties to assess their financial positions.
The stay should be in place pending the outcome of the objection and decision and, if there is an application to the SSAT, pending the outcome of the SSAT decision. I do not propose extending the stay beyond that as appeals from the SSAT lie only on questions of law and therefore are relatively infrequent. If there is a matter of significance that is outstanding after the SSAT makes it decision, then a further stay can be sought when the notice of appeal is lodged in this court.
I therefore order that the collection of arrears be stayed and the current assessment, to the extent it exceeds $100 per week, be stayed pending the outcome of the objection and if there is an application to the SSAT, the SSAT decision as to the departure application in this case.

I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of Riethmuller FM

Deputy Associate: Katherine Sudholz

Date: 17 August 2009