M and M

[2009] FCWAM 54

JURISDICTION : MAGISTRATES COURT OF WESTERN AUSTRALIA - 150

TERRACE ROAD

ACT : CHILD SUPPORT (ASSESSMENT) ACT 1989

CHILD SUPPORT (REGISTRATION and COLLECTION) ACT 1988

LOCATION : PERTH

CITATION : M and M [2009] FCWAM 54

CORAM : MONAGHAN M

HEARD : 19 OCTOBER 2009

DELIVERED : 19 NOVEMBER 2009

FILE NO/S : PTW 68 of 2004

BETWEEN : M Appellant/Father

AND M

Respondent /Mother

Catchwords:

Child Support Appeal from SSAT - Power of Child Support Registrar and SSAT to vary assessment when departure order in force - Effect of income amount order on Administrative Review, Objection and SSAT Review

Legislation:

Family Law Rules 2004

Child Support (Registration & Collection) Act 1988, s 80, s 89, s 110

Child Support (Assessment) Act 1989, s 60(2), s 98B, s 98B, s 117, s 118, s 119, s 119(2)

Category: Not Reportable

Representation:

Counsel:

Appellant : Self Represented Litigant
Respondent : Self Represented Litigant

Solicitors:

Appellant : Self Represented Litigant
Respondent : Self Represented Litigant

Case(s) referred to in judgment(s):

Thompson and Fyatt; Deputy Child Support Registrar (Intervener) (1995) FLC 92-603

1By his Notice of Appeal (Child Support) filed 26 June 2009 the Appellant, [Mr M], seeks to set aside the decision of the Social Security Appeals Tribunal (“SSAT”) dated 3 June 2009.

2That decision increases the amount payable by way of child support for the benefit of [E] born [in] November 1990, [C] born [in] February 1993 and [J] born [in] July 1995 by $7,127.50 for the period 1 January 2008 until 31 December 2008 and by

$5,736 for the period 1 January 2009 till 31 December 2009.

3 The Respondent, [Ms M], opposes the appeal. [Mrs M] filed submissions.

4In accordance with Rule 4.23 of the Family Law Rules 2004 the Notice of Appeal and affidavit in support were served upon [Mrs M], the Child Support Registrar and the Executive Director of the SSAT. I dispensed with the requirements of s 110K of the Child Support (Registration and Collection) Act 1988 that the Executive Director of the SSAT provide to the Court all documents that were before the Tribunal in relation to the proceedings.

5A representative of the Child Support Agency attended at the hearing of the appeal and provided written submissions in order to assist in this determination. The Child Support Registrar is not however a party to these proceedings.

Relevant History

6On 5 and 6 July 2006 a trial took place before the Honourable Justice Penny in relation to financial matters between [Mr and Mrs M], including child support. On 19

July 2006 her Honour handed down reasons for decision and on 1 August 2006 the following orders were made:-

“1. There be a departure order from the administrative assessment of child support payable by the respondent husband in respect of the children of the marriage, [E M] born [in] November 1990, [C M] born [in] February 1993 and [J M] born [in] June 1995 (“the children”) as follows:

(a) from 3 January 2002 to 1 July 2005 the child support income amount for the respondent husband used to calculate the amount of child support payable by the respondent husband to the applicant wife be varied by setting the child support income amount at $33,000;

(b) from and including 1 July 2005 to 19 July 2006 the child support income amount for the respondent husband used to calculate the amount of child support payable by the respondent husband to the applicant wife be varied by setting the child support income amount at $40,000; and

(c) from and including 19 July 2006 until varied by further court order, the child support income amount for the respondent husband and used to calculate the amount of

child support payable by the respondent husband to the applicant wife be varied by setting the child support income amount at $50,000.

2.There should be deducted from the respondent husband’s liability pursuant to paragraphs 1(a) and (b) hereof the sums paid by him in relation to:

(a) Hospital Benefit Fund membership; (b) [E]’s school fees;

(c) the cost of dancing lessons for [E];

(d) the cost of psychologist fees for [E]; and

(e) the wife’s car insurance payments.

3Within 28 days of the date of this Order, the respondent husband is to pay into an interest bearing bank account in the name of both parties the sum equivalent to the child support payable by the respondent husband to the applicant wife in respect of the children from and including 19 July 2006 to 19 July 2009 to be held on trust by them to pay to the applicant wife on a monthly basis the amount due pursuant to the child support assessment created by the Child Support Agency in accordance with these Orders.

4The said application and response otherwise be adjourned generally with liberty to file a Minute of Consent Orders to be dealt with in Chambers, or liberty to re-list upon request of either party.”

7On 28 July 2008, pursuant to s 98B of the Child Support (Assessment) Act 1989 (“the Assessment Act”), the wife applied to the Child Support Registrar for an administrative review of the child support assessment.

8On 12 October 2008 a Senior Case Officer found that a ground for departure existed but that the Appellant had no capacity to pay increased child support.

9Pursuant to s 80 of the Child Support (Registration and Collection) Act 1988 (the “Registration and Collection Act”) on 6 November 2008 the Respondent lodged an objection to the decision of the Senior Case Officer. On 19 December 2008 the Objections Officer allowed the Respondent’s objection and determined that the Appellant’s child support should be increased by $ 7,074 for the period

1 January 2008 to 31 December 2008 and be increased by $ 4,996 for the period
1 January 2009 to 31 December 2009.

10 Pursuant to s 89 of the Registration and Collection Act on 5 January 2009 the Appellant lodged an application for review of the Objection Officer’s determination with the SSAT. After conducting the appropriate hearing the SSAT varied the decision of the Objection Officer to provide that for the period 1 January 2008 to

31 December 2008 child support be increased by $7,127.50 and for the period

1 January 2009 to 31 December 2009 child support be increased by $5,736.

The issues

11 The Appellant contends that the determination of the SSAT dated 25 May 2009 is ultra vires, in that the Child Support Registrar, or his or her delegate, had no power to entertain the Respondent’s application for administrative review of the existing child support assessment as a result of the orders made by Justice Penny on 1 August

2006.

12 In his submissions received on 14 September 2009, the Appellant refers to s 119 of the Assessment Act which provides as follows:-

Section 119 IMPLEMENTATION OF ORDERS

“119(1) [Registrar to implement Court decision] When a decision of a Court making an order under this Division becomes final, the Registrar must immediately take such action as is necessary to give effect to the decision in relation to any administrative assessment that has been made in relation to the child, the carer entitled to child support and the liable parent concerned (whether by amending the assessment or otherwise).

119(2) [Registrar to act on provisions of Act] In subsequently making an administrative assessment in relation to the child, the carer entitled to child support and the liable parent concerned while the order is in force, the Registrar must act on the basis of the provisions of this Act as modified by the order.”

13 At paragraph 14 of his submissions the Appellant states as follows:-

“14 It is respectfully submitted that the object and purpose of section

119 is to give effect to orders of the Family Court, and to prevent their being undermined by subsequent internal decisions of the CSA.”

14 In respect of this issue the Child Support Registrar’s submissions state as follows:-

“9. The Registrar submits that in relation to future child support periods, the Order by Justice Penny only modified the child support income of the Applicant. Consequently, and pursuant to s 119(2) the other elements of an administrative assessment are open to variation through the statutory mechanisms in the Assessment Act.”,

and at paragraph 11:

“11. A parent’s child support income is but one component in a complex formula designed to accurately account for the cost of children and

capacity of parents to pay. Section 35 of the Assessment Act provided the formula for assessing child support in this case. The Court ordered child support income amount for the Applicant is only one component to input into the formula.”

15 In essence, the submission of the Child Support Registrar is that if a Court makes a departure order the Child Support Registrar is bound to implement those parts of the formula that are the subject of the departure order, and those parts of the formula that are not the subject of the departure order are open to administrative review by the normal operation of the Registration and Collection and Assessment Acts.

16 There are no reported, nor to the best of my knowledge unreported, decisions in relation to this issue. In the case of Thompson and Fyatt; Deputy Child Support Registrar (Intervener) (1995) FLC 92-603 Mullane J held that the Child Support Registrar had no power to entertain an application for administrative review in circumstances where a departure order had been made by a Court, which departure order set the annual rate of child support payable by the payer in that case. As the departure order in that case set the annual rate of child support payable, there were no other elements of the formula for calculation of child support that could remain open to the Child Support Registrar to administratively review.

17 Section 118 of the Assessment Act sets out the wide ranging orders a Court may make when departing from an administrative assessment. Those powers include varying the annual rate of child support payable, varying a parent or non parent carer’s cost percentage for a child, varying a parent’s child support income, varying a parent’s child support percentage and varying the costs of the children. In this case her Honour determined that the appropriate order was to vary, and fix, the Appellant’s child support income amount for the purposes of calculating the child support payable.

18 This issue is to be determined by the interpretation of s 119(2) of the Assessment Act. In determining the correct interpretation of that sub-section, the Court should give effect to the ordinary meaning of the terms used. In my view the phrase “the Registrar must act on the basis of the provisions of this Act as modified by the order” is the crucial part of sub-section 119(2).

19 Departure orders made pursuant to s 117 of the Assessment Act are precisely that: they “depart” from the relevant sections of the legislation that prescribe the formula and mechanisms for calculation of child support payable. The departure order “modifies” those provisions of the Act in accordance with the individual terms of each departure order.

20 The terms of the sub-section are clear. The Registrar is bound to implement only those parts of the Act “modified” or “departed from” by a departure order under s 117 of the Assessment Act. Had Parliament intended to legislate with the consequences submitted by the Appellant in this matter, s 119(2) would not need to make reference to “the provisions of this Act as modified by the order”. Parliament could have legislated that the administrative review provisions of the Assessment Act simply do not apply and parties are required to make Court application to vary any

previous departure order, whether that order modified only one provision of the

Assessment Act (for example the child support income amount) or otherwise.

21 Not only are the terms of s 119(2) clear and unambiguous (although this issue was not canvassed in submissions), the Assessment Act does provide that in some circumstances, when an “income amount order” is in force, some rights under the Assessment Act that are otherwise available may not be exercised.

22 An “income amount order” is defined in s 5 of the Assessment Act as including a departure order that varies the child support income of a parent, such as the order of

1 August 2006 in these proceedings. Section 60(2) of the Assessment Act provides that a parent may not elect to estimate their adjusted taxable income if an income amount order is in force for the relevant period. Section 146G(2) of the Assessment Act provides that a parent may not elect to estimate their adjusted taxable income for the purposes of a notional assessment if an income amount order is in force for the relevant period.

23 The Act therefore provides for the abolition of some rights when an income amount order is in force. The Act does not contain any provisions abolishing a person’s right to administrative review when an income amount order is in force. The terms of s 119(2) do not nearly go that far.

24 The issue dealt with by the Senior Case Officer, Objections Officer and SSAT was the Respondent’s application for the Appellant to make a contribution towards the children’s educational expenses. Whether or not that matter was agitated before Justice Penny by the parties at the hearing, her Honour’s order only modified the Assessment Act insofar as the Appellant’s child support income amount was concerned. The Child Support Registrar still retained the powers contained in the Assessment Act, including the power to administratively vary the child support payable in this matter, in all respects except the Appellant’s child support income amount.

25 I therefore conclude that the Senior Case Officer had power under the Assessment Act to hear and determine the wife’s application filed 28 July 2008. The Objection Officer therefore had power to hear the wife’s objection dated

6 November 2008 pursuant to the provisions of s 80 of the Registration and Collection Act and the SSAT had power to hear and determine the Appellant’s application for review filed 5 January 2009 pursuant to s 89 of the Registration and Collection Act.

26 In my view however the matter does not end there. I have found that the Child Support Registrar was bound to implement Justice Penny’s order that the Appellant’s child support income amount be set at $50,000 per annum. As delegates of the Child Support Registrar, the Senior Case Officer and the Objections Officer were also so bound. In my view, the SSAT was similarly bound. The SSAT was bound to hear and determine the review in accordance with the provisions of the Registration and Collection Act, and the Act under which the assessment issued, namely the Assessment Act. For the purposes of the Assessment Act her Honour had set the Appellant’s child support income amount at $50,000 per annum. At paragraph 52 of the SSAT determination, the Tribunal states as follows:-

“The Tribunal notes that if [Mr M] was assessed on his actual adjusted taxable income and not the amount of $50,000 fixed by the Family Court it is likely that his annual rate of child support would be greater than his present liability of $7,572.

The Tribunal is satisfied that [Mr M]’s taxable income of $59,830 in

2006/2007 and taxable income of $56,400 in 2007/2008 provides [Mr M] with the ability in 2008 and 2009 to make a 50% contribution to the education costs of the children.”

27 It is therefore clear that the Tribunal considered the Appellant’s child support income amount to be greater than that set by Justice Penny and used those greater amounts to establish that the Appellant had the capacity to make a contribution towards the educational costs of the children.

28 In my view the Tribunal was not at liberty to use any other child support income amount other than the one set by Justice Penny. That order modified the Assessment Act insofar as that Act makes provision for the calculation of the income of the Appellant for the purposes of a child support assessment. That modification remains binding in all aspects of the operation of the Assessment Act to these parties and their children. The Respondent is at liberty, pursuant to her Honour’s orders, to apply in relation to varying the child support income amount of the Appellant.

29 I therefore conclude that the decision of the SSAT is flawed by an error of law, namely that the Tribunal applied a child support income amount for the Appellant that was not in accordance with the order of Justice Penny of 1 August 2006.

30 Pursuant to s 110F of the Registration and Collection Act I may make such orders as are appropriate by reason of my decision. Those orders, pursuant to sub- section 110F(2), include orders affirming or setting aside the decision of the SSAT or remitting the case to be heard and decided again by the SSAT.

31 I do not consider it appropriate in this case to remit the matter to the SSAT.

I have found pursuant to the order of Justice Penny of 1 August 2006 the Child Support Registrar, his or her delegates and the SSAT are bound in their determinations that the Appellant’s child support income amount is $50,000 per annum. In my view it is for the Respondent to apply to the Court for an order varying Justice Penny’s order should the Respondent seek that any determination of her application to increase child support on the basis of educational costs be determined on the Appellant’s actual income at the relevant time.

32 In my view the appropriate orders are to reinstate the child support assessment that was existing at the time the Respondent made her application for an administrative change of assessment on 28 July 2008, putting the parties back to the position as though the administrative application to vary, objection and SSAT determination had not occurred.

33 For those reasons there will be the following orders:-

1. The appeal be allowed.

2.For the period 1 July 2008 to 5 November 2008 the Appellant pay child support for the benefit of the children [E] born [in] November

1990, [C] born [in] February 1993 and [J] born [in] June 1995 at an annual rate of $8,382 and thereafter pay child support in accordance with the provisions of the Child Support (Assessment) Act 1989 as modified by the orders dated 1 August 2006 made in Family Court of Western Australia at Perth.

I certify that the preceding [33] paragraphs are a true copy of the reasons for judgment delivered by this Honourable Court

Secretary