Lunn and Lunn (Child support)

[2019] AATA 261

Lunn and Lunn (Child support) [2019] AATA 261 (14 January 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/PC014213

APPLICANT:  Mr Lunn

OTHER PARTIES:  Child Support Registrar

Ms Lunn

TRIBUNAL:Senior Member R Ellis

DECISION DATE:  14 January 2019

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that $141.68 should be credited under section 71A of the Child Support (Registration and Collection) Act 1988 against Mr Lunn’s child support liability.

CATCHWORDS

CHILD SUPPORT – non-agency payment - whether payment made to a third party in lieu of child support - intention of both parents - decision under review set aside and substituted

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 Lunn and Ms Lunn are the parents of [Child 1] (born July 2004) and [Child 2] (born December 2006).

2. There has been a child support assessment in place since 13 August 2014 and prior to 15 May 2017 the parents had a private arrangement in place regarding payments.  Mr Lunn is the liable parent under the assessment.

3. On 4 December 2017 Mr Lunn applied to the Department of Human Services, Child Support (the Child Support Agency) for credit of non-agency payments for expenses he paid totalling $415.94.

4. On 14 December 2017 the Child Support Agency made the decision to refuse to credit the payment of $415.94 claimed by Mr Lunn as non-agency payments.

5. On 28 December 2017 Mr Lunn objected to this decision and on 3 May 2018 the Child Support Agency disallowed the objection (the objection decision).

6. On 30 May 2018 Mr Lunn applied to the Administrative Appeals Tribunal (the Tribunal) for a review of the objection decision.

7. The matter was considered on 11 December 2018.  Mr Lunn attended the hearing in person and gave sworn evidence.  On 8 November 2018 Ms Lunn advised the Tribunal she was unable to attend the hearing due to work commitments and so did not participate.   The Child Support Agency provided the Tribunal and the parties with a bundle of documents relevant to the review (156 pages).

ISSUES

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

2. When a child support liability is registered under the Act for collection, the amount payable is a debt due to the Commonwealth and must be paid to the Child Support Agency not the payee.  In some circumstances the Child Support Agency may credit payments made directly to a payee or to a third party against a child support liability that is registered for collection (sections 71 and 71A of the Act).  The Child Support Agency refers to the credits under sections 71 and 71A as ‘non-agency payments’.

3. The issue which arises in this case is whether or not any of the payments made by Mr Lunn can be credited against his child support liability.

CONSIDERATION

1. Mr Lunn told the Tribunal that from 2016 the parents had a private agreement in place for the payment of additional expenses for the children.  He said each month he would list in a spreadsheet all the extra payments made by both parents and then calculate how much should be deducted from, or added to, the child support payment.  Mr Lunn said he would send the spreadsheet to Ms Lunn a week before the child support payment was due to allow her to review the expenses and let him know if she approved.  He would then make the correct child support payment to Ms Lunn based on her agreement.

2. Mr Lunn said his share of additional payments he made for the children in May 2017 was $255.10 and in June was $160.84 for a total of $415.94 which should be considered as non-agency payments.

3. Mr Lunn told the Tribunal the Child Support Agency had previously accepted there was an arrangement in place with Ms Lunn to adjust the child support payments for these additional expenses but had not considered those expenses he deducted in May and June 2017.  He said the arrangement was still in place at this time and Ms Lunn had not disputed the deductions he had made for the expenses in these months.

4. Evidence from the Child Support Agency includes an email exchange between Mr Lunn and Ms Lunn regarding child support matters.  In relation to additional expenses, the Tribunal notes the following:

   ·     on 24 February 2016, Ms Lunn writes, “I will do my best to pay half of the cost for the boys to do guitar, sport etc…if I’m having any issues then I will let you know and we can work it out”;

   ·     on 29 February 2016, Mr Lunn states, “To that effect, I would suggest that I record what we both pay for school excursions, out-of-pocket medical expenses, sports, guitar lessons etc.  Then every month I’ll calculate what amount is to be paid by each of us and adjust the child support payment as required (this could be up or down depending on who paid what during the month)”;

   ·     on 29 February 2016, Ms Lunn responds, “I’m happy for us both to communicate with each other what costs are to be paid for the boys so we can figure out a system that works for us both”.

5. Mr Lunn said in May 2017 Ms Lunn had requested that he split her last payment for [Child 1]’s laptop between May and June 2017 which supported his claim that she agreed with the arrangement that was in place.  The Tribunal notes in evidence from the Child Support Agency an email from Ms Lunn to Mr Lunn dated 4 May 2017 which states, “Can you please split my last payment for [Child 1]’s laptop between this month and next month?” 

6. Although Ms Lunn did not participate in the hearing, the Tribunal notes that during a conversation with a child support officer on 9 January 2018, Ms Lunn confirms her agreement with the arrangement for cost sharing but said she found it financially difficult when she was unaware of the costs involved.  She said this had been the case in the past and was the reason for her requesting collection by the Child Support Agency.  Ms Lunn goes on to say she now disagreed with these non-agency payments being deducted from her child support as it was not mutually agreed.

7. Mr Lunn confirmed to the Tribunal he was claiming the following expenses deducted from the child support payment made on 18 May 2017:

Date	Description	Amount ($)
14 January 2017	[Child 1] laptop	210.00
5 May 2017	Psychologist for [Child 2]	55.20
8 May 2017	Term 2 guitar lessons for [Child 1]	245.00

1. Mr Lunn also confirmed he was claiming the following expenses deducted from the child support payment made on 19 June 2017:

Date	Description	Amount ($)
14 April 2017	[Child 1] laptop (4 of 4)	210.00
28 April 2017	Transperth [Child 1]	20.00
17 May 2017	[Child 1] socks	10.00
25 May 2017	Transperth [Child 1]	20.00
29 May 2017	[Child 1] iron supplement	55.98
31 May 2017	Psychologist for [Child 2] (net cost)	55.20
9 June 2017	New Transperth card	5.00

1. Section 71A of the Act provides for a payment made by the payer of an enforceable maintenance liability to a third party to be credited against the amount payable under the liability. The amount paid by the payer to the third party must partially or completely satisfy a debt owed by the payee, the payer or both the payer and the payee (paragraph 71A(1)(a)). The amount paid, or a part of the amount paid, must be intended by both the payer and the payee to be paid in complete or partial satisfaction of an amount payable under the liability in relation to the child support enforcement period (paragraph 71A(1)(c)).

2. Collection of child support by the Child Support Agency commenced from 15 May 2017.  As there was no enforceable maintenance liability prior to this date, only payments made after 15 May 2017 can be considered as non-agency payments.  This includes the payments made on 17 May 2017 (socks), 25 May 2017 (Transperth), 29 May 2017 (iron supplement), 31 May 2017 (psychologist) and 9 June 2017 (new Transperth card) for a total of $146.18.

3. The Tribunal notes that according to the spreadsheet for the June 2017 expenses provided in evidence by the Child Support Agency, Ms Lunn made a payment of $4.50 on 24 May 2017 for football costs.

4. In circumstances where parents disagree about a payment being intended as child support, the Child Support Guide at 5.3.1 provides the following in terms of guidance:

   Where the parents disagree, the Registrar will seek evidence from both parents and decide on the basis of that evidence whether the relevant intention existed when the payment was made. 

   The Registrar will seek oral statements (or written, if either parent cannot be contacted by telephone) from both parents about their intention at the time the payment was made and the circumstances surrounding the payment. Before making a decision, the Registrar will discuss the evidence with both parents, so that they have an opportunity to respond or expand on their statements.

   If the Registrar cannot obtain a statement from one of the parents, the Registrar will consider a statement made by the other parent and any other available evidence.

5. Although not bound by policy as set out in the Child Support Guide, the Federal Court has held that a tribunal should take into account relevant government policy which is not inconsistent with the provisions or objects of the legislation.

6. The Tribunal is satisfied the five payments made by Mr Lunn after 15 May 2017 were made during an enforceable maintenance period as the Child Support Agency was collecting child support at that time.  It is unclear exactly when Ms Lunn ceased to support the arrangement made with Mr Lunn regarding additional expenses for the children.  There is no evidence before the Tribunal which confirms Ms Lunn communicated to Mr Lunn that she no longer wanted the arrangement to continue.  The Tribunal is satisfied, based on the evidence provided, that at the time the five payments were made by Mr Lunn they were intended to be in lieu of child support.

7. As the Tribunal has established that payments made by Mr Lunn totalling only $146.18 satisfy section 71A of the Act, the Tribunal finds that this amount, less the $4.50 paid by Ms Lunn on 24 May 2017, should be credited as non-agency payments against his child support liability.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that $141.68 should be credited under section 71A of the Child Support (Registration and Collection) Act 1988 against Mr Lunn’s child support liability.