LINDSEY & CHRISTIE & ANOR (SSAT APPEAL)
[2014] FCCA 1838
•15 August 2014
FEDERAL CIRCUIT COURT OF AUSTRALIA
| LINDSEY & CHRISTIE & ANOR (SSAT APPEAL) | [2014] FCCA 1838 |
| Catchwords: CHILD SUPPORT – Appeal from decision of the Social Security Appeals Tribunal – no error of law established. |
| Legislation: Child Support Assessment Act 1989, s.117 |
| Applicant: | MR LINDSEY |
| First Respondent: | MS CHRISTIE |
| Second Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | CAC 22 of 2010 |
| Judgment of: | Judge Hughes |
| Hearing date: | 1 August 2014 |
| Date of Last Submission: | 1 August 2014 |
| Delivered at: | Canberra |
| Delivered on: | 15 August 2014 |
REPRESENTATION
| Counsel for the Applicant: | Self represented |
| Counsel for the First Respondent: | Self represented |
| Counsel for the Second Respondent: | Mr Palfrey |
| Solicitors for the Second Respondent: | Sparke Helmore |
ORDERS
The appeal from the Social Security Appeals Tribunal decision of 17 March 2014 is dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Lindsey & Christie & Anor (SSAT Appeal) is approved pursuant to s.110X(4)(h) of the Child Support (Registration and Collection) Act 1988 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT CANBERRA |
CAC 22 of 2010
| MR LINDSEY |
Applicant
And
| MS CHRISTIE |
First Respondent
| CHILD SUPPORT REGISTRAR |
Second Respondent
REASONS FOR JUDGMENT
Introduction
This is an appeal from a decision of the Social Security Appeals Tribunal (“the Tribunal”) of 17 March 2014. The appellant resigned from a well-paid job in the public service to commence a business from which he has earned no income. The Tribunal assessed him as having a capacity to earn the income he was earning prior to his resignation and set his child support income accordingly. The appellant argued the Tribunal had erred at law by focusing its attention on his income earning capacity at the expense of other relevant legislative considerations.
Background
The appellant and the first respondent are parents of two children currently aged six and four years. The appellant is the liable parent and the first respondent is the carer entitled to child support.
A child support assessment has been in place since 27 November 2009.
The appellant worked for [omitted] from 2006 until he resigned from the public service in February 2013 to commence his own business. At the time of his resignation he was earning an annual salary of $132,200.
On 5 April 2013 the appellant provided to the Child Support Registrar an estimate of his income, being nil. His child support liability was reduced to nil.
On 18 July 2013 the first respondent lodged a change of assessment application on the basis that the appellant’s income, earning capacity, property and financial resources were not reflected in the administrative assessment.
On 23 August 2013 a senior case officer found the ground for departure established and made a departure determination which set the appellant’s adjustable taxable income at $132,966 for the period 5 April 2013 to 30 November 2015.
On 2 September 2013 the appellant objected to the departure decision and on 16 October 2013 the objection was disallowed.
On 13 November 2013 the appellant applied to the Social Security Appeals Tribunal for a review of the decision.
The Tribunal conducted a hearing on 7 March 2014 and issued written reasons for decision on 17 March 2014. The Tribunal decided that for the period 5 April 2013 to 30 November 2015 the appellant’s adjusted taxable income would be set at $132,966.
The legal principles
Section 117 of the Child Support Assessment Act 1989 (“the Assessment Act”) sets out the law in relation to departure applications. Although the section refers to an application to a court, the same provisions apply to determinations of departure applications by the Child Support Registrar.[1]
[1] Section 98C(2) of the Child Support Assessment Act 1989
The Child Support (Registration and Collection) Act 1988 (“the Collection Act”) provides for review of certain decisions of the Registrar by the Tribunal. Pursuant to section 103T of the Collection Act, in reviewing a decision of the Registrar, the Tribunal is required to consider the departure application afresh and, in doing so, has the same powers and discretions as the Registrar.
Subdivision B of Part VIII of the Collection Act deals with appeals to this Court from decisions of the Tribunal. An appeal from a decision of the Tribunal can only be made on a question of law.[2]
[2] Section 110B
The appellant argued that the Tribunal had misapplied the legislation and, in particular, section 117(4) of the Assessment Act in making its determination to depart from the administrative assessment of child support. He argued the Tribunal had relied too heavily on his income earning capacity and did not properly consider other matters required by to be taken into account.
Section 117(1) of the Assessment Act provides a two-step process for a departure determination. First, the Tribunal must be satisfied that one or more of the grounds for departure in section 117(2) exist. Secondly, the Tribunal must be satisfied that it would be just, equitable and otherwise proper to make the determination. The remaining subsections of section 117 provide further detailed provisions to assist in deciding whether a particular ground of departure is established and whether the justice and equity considerations are met.
The ground relied upon by the first respondent in the original departure application was that provided in section 117(2)(c)(ib), namely, that in the special circumstances of the case, the administrative assessment of child support would result in an unjust and inequitable determination of child support because of the earning capacity of the appellant.
Consideration of the earning capacity of a parent is not only relevant to determining whether or not a ground for departure exists but also to determining whether or not it is just, equitable and otherwise proper to make the departure determination.
The Tribunal’s decision of 17 March 2014
In its decision of 17 March 2014 the Tribunal set out the background to the dispute and the issues needing to be determined. From paragraph 21 of the decision, the Tribunal worked its way through the provisions of section 117 of the Assessment Act. It correctly set out the law and then considered the evidence presented in relation to each of the factors relevant to this case.
In order to satisfy the first step of the two-step process required by section 117, the Tribunal first considered whether or not a ground for departure based on the appellant’s income earning capacity was established. At paragraphs 44 and 45 the Tribunal summarised the legislative requirements into three criteria as follows:
44.The question of whether to have regard to a parent’s earning capacity can only be determined after an initial three-step process is satisfied. The criteria to be satisfied are:
Whether the parent is:
·not working despite ample opportunity to do so (subsection 117(7B)(a)(i)); and/or has reduced their weekly hours of work to below full-time work (subsection 117(7B)(a)(ii)); and/or has changed their occupation, industry or working pattern (subsection 117(7B)(a)(iii)); and
·if the parent’s decision about his/her work arrangements is not justified by either his/her caring responsibilities (subsection 117(7B)(b)(i)) or his/her state of health (subsection 117(7B)(b)(ii)); and
·if the parent has not demonstrated that it was not a major purpose of their decision not to work despite ample opportunity to do so or to stop working, reduce their hours of work or change their occupation, industry or working pattern to affect the administrative assessment of child support (subsection 117(7B)(c));
45.All of the above criteria must be met before a decision maker can make a finding that a parent’s earning capacity is greater than is reflected in his or her income used in the child support formula.
The Tribunal found the first criterion had been satisfied because the appellant had “changed his occupation, industry and his working pattern from a full-time executive level public sector employee to self-employment as a company director working to establish a new online business in an entirely different field”.[3] That was not disputed by the appellant.
[3] Paragraph 46
In relation to the second criterion the Tribunal made a finding of fact that the appellant’s decision to change his work arrangements was not justified by his caring responsibilities or his state of health.[4] That finding was clearly open to the Tribunal as the appellant presented no evidence to the contrary.
[4] Paragraph 47
The Tribunal found the third criterion was satisfied because the appellant had failed to demonstrate that affecting the child support assessment was not a major purpose of his decision to change his employment.[5] In reaching that decision the Tribunal relied on statements made by the appellant in his oral evidence and written submissions his about his reasons for commencing his business and his expectation about the impact it would have on his child support assessment. The Tribunal found that he resented paying child support. Those findings of fact were open to the Tribunal on the evidence before it.
[5] Paragraph 48
Given all of the legislative requirements were met, the Tribunal found the ground for departure established.
The Tribunal then considered the second step required by section 117(1)(b), which is whether or not it would be just and equitable as regards the child, the carer entitled to child support and the liable parent and otherwise proper to make a particular order. The Tribunal correctly identified that in making that determination it was required to consider the matters set out in section 117(4) to (9) of the Assessment Act. The Tribunal encountered some difficulty in assessing the financial circumstances of the appellant because he had failed to comply with a direction to provide the Tribunal with copies of bank and credit card statements for particular periods and that, while he provided some information, much of it was in the form of spreadsheets using information he taken from the bank statements.
The Tribunal made detailed findings of fact set out at paragraphs 75 to 96 of the reasons for decision and concluded that it was just, equitable and otherwise proper to make the determination sought by the respondent. Those findings of fact were open to the Tribunal on the evidence before it.
The Tribunal set the appellant’s adjusted income for the purpose of the administrative assessment of child support formula at the same level as his income earning capacity which it found was $132,966.
The Tribunal noted that the first respondent had increased her work hours at the beginning of 2014 from three days to four days each week and that she intends to increase her hours further when the youngest child commences school in 2015. The Tribunal increased her adjusted taxable income from 6 January 2014 and again from 2 February 2015. That is reflected in the decision of the Tribunal which separately sets the adjusted taxable income for the appellant and the first respondent.
The appeal
The appeal to this Court from the decision of the Tribunal was filed on 14 April 2014. It was heard on 1 August 2014.
The notice of appeal contains 13 grounds but many of them are more appropriately characterised as submissions. In essence, the appeal is put on the basis that the Tribunal failed to adequately consider each of the matters required to be taken into account pursuant to section 117(4) of the Assessment Act in determining whether it would be just, equitable and otherwise proper to make a departure determination. In particular the appellant argued the Tribunal failed to give sufficient weight to paragraphs (d), (e) and (g) of section 117(4) which deal with the income, property and financial resources of each parent, their necessary financial commitments and hardship issues. The gravamen of his argument was that the Tribunal, while paying lip service to each of those matters, failed to properly consider them and placed insufficient weight on them. I reject that. Each legislative requirement was carefully considered and all findings made were properly based on the evidence before the Tribunal.
The appellant and both respondents filed written submissions. The appellant also filed a document in which he used a “traffic light” system to demonstrate what he said were the circumstances in which any fact finder would fall into appealable error by setting a liable parent’s income for the purpose of an administrative assessment of child support at or close to their earning capacity when there was a discrepancy between earning capacity and actual earnings. I was not assisted by it.
I was assisted by the written submissions prepared by the second respondent. I accept and adopt those submissions.
The appellant has failed to establish any error of law on the part of the Tribunal and the appeal, therefore, fails.
I certify that the preceding thirty-two (32) paragraphs are a true copy of the reasons for judgment of Judge Hughes
Associate:
Date: 15 August 2014
Key Legal Topics
Areas of Law
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Administrative Law
Legal Concepts
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Appeal
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Procedural Fairness
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