Maidwell and Routledge (Child support)

Maidwell and Routledge (Child support) [2018] AATA 1235 (3 April 2018)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2017/BC011453
APPLICANT:  Mr Maidwell
OTHER PARTIES:  Child Support Registrar
Mrs Routledge

TRIBUNAL:Member J Thomson
DECISION DATE: 3 April 2018
DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that:

the decision of DM [Mr A] will end on 31 December 2016;
the rate of child support payable by Mr Maidwell for the period 1 January 2017 to 31 December 2017 is increased by $3,825 per annum; and

the rate of child support payable by Mr Maidwell for the period 1 January 2018 to 31 December 2018 is increased by $3,201 per annum.

CATCHWORDS
Child support – Departure from assessment – Costs of education – Manner of education expected by 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

Mr Maidwell and Mrs Routledge are the parents of [Child 1], born 2001, and currently in her final year (grade 12) at [School 1], [Town 1], [State 1]. Mrs Routledge has primary care of [Child 1]who resides with her mother in [Town 1].
Mr Maidwell seeks review of an objection decision made by the Department of Human Services – Child Support (the Department) on 31 March 2017. This decision allowed his objection to a decision dated 4 January 2017 which affirmed an earlier decision of the Department’s Decision Maker (DM) [Mr A] dated 3 May 2016. The objections officer set aside the decision dated 4 January 2017, and varied DM [Mr A]’s decision of 3 May 2016 to provide that that decision ended on 31 December 2016, and for the period 1 January 2017 to 31 December 2017, the rate of child support payable by Mr Maidwell would be increased by $3,201 per annum, and for the period 1 January 2018 to 31 December 2018, the rate of child support payable by Mr Maidwell would be increased by $2,590 per annum.
The Tribunal heard the matter on 6 March 2018. Mr Maidwell attended the hearing in person. Mrs Routledge attended the hearing via conference telephone. Both parents gave affirmed evidence. The Tribunal had before it documentation provided by the Department, Mr Maidwell and Miss Routledge, admitted into evidence and marked Exhibits 1, A and B.
Mrs Routledge was directed to provide further evidence in the form of an invoice for [School 1]’s school fees and charges for the 2018 school year. She complied with this direction and the invoice she provided was admitted into evidence and added to Exhibit B. Due to the nature of this document it was not considered necessary to provide a copy to Mr Maidwell for his comment. A copy will be provided to him with the Tribunal’s written decision.

CONSIDERATION

In reaching its decision, the Tribunal has considered the affirmed evidence given by Mr Maidwell and Mrs Routledge at hearing and the documentation provided by the Department, Mr Maidwell and Miss Routledge, admitted into evidence and marked respectively Exhibits 1, A and B.

The legislative framework

The rate of child support payable by a liable parent is usually based on an administrative assessment under Part 5 of the Child Support (Assessment) Act 1989 (the Act). A formula is used. It takes into account variables including each parent’s adjusted taxable income for the last relevant year of income, the number of children and the level of care provided by each parent. Part 6A of the Act allows for a departure from the administrative assessment (a process commonly known as a “change of assessment”). Under subsection 98C(1), the Registrar may make such a departure determination if three matters are established:
·One, or more than one, of the grounds for departure referred to in subsection 98C(2) exists (subparagraph 98C(1)(b)(i));
·A departure is just and equitable as regards the children and each parent (sub-subparagraph 98(1)(b)(ii)(A)); and
·It is otherwise proper to make a departure decision (sub-subparagraph 98C(1)(b)(ii)(B))
Subsection 98C(2) provides that the grounds for departure are the same as the grounds set out in subsection 117(2) of the Act.
If satisfied that a ground or grounds exist and that it would be just and equitable and otherwise proper to make a particular determination, the Registrar may make one of the determinations prescribed in section 98S of the Act. It permits a range of determinations, including varying the rate of child support payable, the adjusted taxable income or the cost percentage for a child.

Grounds for departure

Subparagraph 117(2)(b)(ii) - commonly referred to as Reason 3 - provides as a ground for departure:
(c) that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child…..
(ia) because of the income, property and financial resources of either parent; or….
The words “in the special circumstances of the case” are not defined in the legislation. Whilst it is not possible to define with precision the meaning of that term, it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the legislation in subsection 117 (2) must be guided by the qualification that the Tribunal will not interfere with the administrative formula result in the ordinary run of cases. In Gyselman and Gyselman [1991] FamCA 93, it was held that “special circumstances” were “facts peculiar to the particular case which set it apart from other cases”. The Tribunal will consider whether the application of the administrative assessment would result in an unjust and inequitable determination of child support payable, having regard to the evidence relevant to the parents’ financial position.
Both parents agreed at hearing that the issues before the Tribunal were Mr Maidwell’s philosophical objection to his daughter, [Child 1], being educated at a private Catholic secondary school and his financial capacity to contribute to the cost of educating [Child 1] at a private secondary school.
[Child 1] is presently enrolled as a student in grade 12, her final year of secondary school, at [School 1], a secondary college conducted by the [State 1] Catholic Education Commission in [Town 1], [State 1] where she resides with her mother, Mrs Routledge.
Both parents also acknowledged and agreed at hearing that it was their mutual intention that their only child, [Child 1], be educated at an all-girls public school or a private school.
Mr Maidwell’s case at hearing was that he had a philosophical objection to his daughter being educated at a Catholic school, but he had no objection to [Child 1] being educated privately at school conducted by the Anglican Church.
The parents were residing in it [Town 2] at the time of their discussion regarding [Child 1]’s future education, and because there were no all-girls public schools in [Town 2], or for that matter, in the State of [State 1], the parents agreed that [Child 1] should attend [School 2], an all-girls school conducted by the Anglican Church in [Town 2].
[Child 1] was duly enrolled at [School 2] from grade 6 and attended that school until grade 8, when Mrs Routledge and [Child 1] moved [Town 1], following the breakdown of the relationship between Mr Maidwell and Mrs Routledge
Mrs Routledge gave evidence that her decision to relocate to [Town 1] was precipitated by a breakdown of her relationship with Mr Maidwell. She was a need of financial and emotional support, and her parents, who resided in [Town 1], had offered to assist her with support in those respects. Following her relocation to [Town 1], Mrs Routledge enrolled [Child 1] at [School 3], one of the three private schools in [Town 1].
Mr Maidwell acknowledged in evidence that he had voluntarily contributed to [Child 1]’s educational costs whilst she was a student at [School 2] and would have been content for [Child 1] to remain at that school and contribute to the costs of education at that school had it not been for Mrs Routledge’s decision to relocate to [Town 1].
Mrs Routledge said in evidence that there had been some issue with Mr Maidwell’s continuing to contribute to the cost of [Child 1]’s education at [School 2] towards the latter part of [Child 1]’s grade 8 year which had some bearing on her decision to move to [Town 1].
Mr Maidwell said in evidence that, although he was not consulted by Mrs Routledge regarding her decision to enrol [Child 1] at [School 3] in [Town 1], he had no objection, philosophical or otherwise, to her being educated at that school, and he had voluntarily contributed to the costs of her education at that school. Indeed, he said in evidence that he would have been content for [Child 1] to complete her education at that school and to contribute to the associated costs.
Both parents acknowledged in evidence that [Child 1] had encountered some problems with the host family whilst she was an exchange student [overseas] in April/May 2016, due in part to her vegetarian dietary requirements, and after some discussion with Mrs Routledge, it was agreed that Mr Maidwell, who was already committed to travelling [overseas]to visit his family in his native [country] at that time, would meet up with [Child 1] at [the]airport [and] bring her back to Australia.
[Child 1] returned to Australia with Mr Maidwell and resumed her education at [School 3] towards the latter part of term 3 in 2016. However, Mrs Routledge gave evidence that [Child 1] encountered problems at school with one of the[exchange] students resulting in bullying and social exclusion incidents, which impacted upon her health, both mentally and physically, to the extent that she was referred for medical treatment and psychological counselling for her condition.
Mrs Routledge provided medical evidence in the form of reports from [Dr B]of [a]Family Practice dated [July] 2016 in support of her evidence – see Exhibit B pages 19 and 20.
Mrs Routledge said in evidence that when [Child 1]’s condition failed to improve, she sought advice from the school counsellor at [School 3],[Mr C].
After consulting with [Mr C], Mrs Routledge and [Child 1] gave consideration to changing schools. Mrs Routledge said there were only two other private schools in [Town 1] from which to choose – [School 1] and[School 4]. [Mr C] provided a report (see Exhibit B, pages 22 and 23) in which he sets out in some detail the circumstances in which [Child 1] found herself at [School 3] and endorses Mrs Routledge and [Child 1]’s decision to consider a change of schools.
Mrs Routledgegave evidence that, as a qualified [professional]she had[worked]in Catholic schools conducted by the [State 1]Catholic Education Commission in the [City]and [Town 2]for a number of years. She said she was impressed by the high standard of education imparted by the Commission’s schools, to the extent that she had converted from her original Anglican religious persuasion to Roman Catholicism in April 2009. In support of her evidence, she provided copies of certificates and statements of employment as a school teacher from the [Town 2] Diocese Catholic Education office for various periods from October 2003 to January 2010 (see Exhibit B, pages28 to 32).
After careful consideration and discussion with [Child 1], Mrs Routledge said she successfully applied for [Child 1]’s enrolment at [School 1] in [Town 1] from the commencement of term 4 in 2016.
Mr Maidwell said he was not consulted about the change in schools from [School 3] to [School 1]. He said he had not objected to [Child 1] attending [School 3]’s and had contributed to her school fees and other expenses at that school. However, he said he was strongly opposed on philosophical grounds to [Child 1] being educated at a Catholic school because he considered the standard of education delivered by Catholic schools to be substandard.
Mr Maidwell also referred the Tribunal to a decision of Judge McGuire of the Federal Circuit Court of Australia in the matter of Barstow and Barstow [2016] FCCA 2185 (Barstow) as authority for the proposition that a parent should not be obliged to meet the extra costs incurred over and above a child support assessment in circumstances where the paying parent is opposed to private school education on a philosophical basis.
Mr Maidwell confirmed the basis of his philosophical objection was confined to his belief that the standard of education offered by a Catholic school was inferior to that offered by the state operated public school system and other privately operated schools, including private schools operated by the Anglican Church in [State 1] such as [School 2] in [Town 2] and [School 3] in [Town 1]. He said his objection was not based on religious grounds, as he was an atheist.
To sustain his objection on the grounds of the philosophical belief that the standard of education offered by a Catholic institution is inferior to that offered by other institutions, secular or otherwise, the Tribunal considers Mr Maidwell has to demonstrate that his belief is reasonably founded.
The [State 1] Catholic Education Commission, as the controlling body of the Catholic Education Office is a Federal and State recognised, accredited educational institution whose website advertises it as providing education to over 70,000 students in [State 1] from preparatory to secondary level education.
The Tribunal has conducted its own enquiries of the Australian Curriculum, Assessment and Reporting Authority (ACARA) and its website publications “My School”, “NAPLAN” and “Senior School Results” with respect to the academic performances of the secondary schools, state and private, and in particular, [School 1] and [School 3], [School 4].
The Tribunal’s enquiries reveal that there are six secondary schools in the [Town 1] district, all of which are co-educational institutions: [School 1], administered by the Catholic Education Commission; [School 3], administered by the Anglican Church of Australia; [Town 1] Christian College, a privately and corporately administered ecumenical interdenominational school; and three State administered high schools.
The “My School” survey results for the 2017 academic year reveal that of the six schools in the [Town 1] area, [School 1] recorded the highest number of students achieving an OP1 result (36 or 23% of its 153 eligible grade 12 students) compared with the next school, [School 3] at 12 or 21.05% of its 57 eligible grade 12 students.
The Barstow decision, to which Mr Maidwell referred the Tribunal, related to a philosophical objection, on the part of the father of the relevant children, to their being educated at a private school as opposed to a public school. The parents had not reached agreement as to the manner in which, or standard to which, the children in that case should be educated, and the initial issue for determination by the court was whether the children should be educated privately or at a public school.
As noted in the judge’s reasons, at paragraph 23, whilst he did not think it appropriate to oblige the father to meet the extra costs incurred over and above a child support assessment simply on a dispute of principle, which would have involved him entering into an inappropriate and unnecessary subjective determination as to the value of public or private education where there was no objective evidence before him, he was not required to do so because the mother had volunteered to meet those expenses. The judge acknowledged the father had not compromised his principles as regards his philosophical objection in accepting the mother’s undertaking responsibility for payment of the private school fees.
In the event, the judge made adjustments in the property settlement determination to compensate the mother for her undertaking that responsibility.
That case involved a different philosophical consideration to that for which Mr Maidwell contends. His case is founded on his perception that the standard of education offered by the Catholic education system is inferior to that offered by the public system or private schools such as [School 2], or [School 3], both of which he acknowledged were acceptable schools for his daughter’s education.
For Mr Maidwell’s argument to succeed, he needs to be able to satisfy the Tribunal that his philosophical objection is reasonably founded.
The qualification he imposed upon his daughter’s education at a public school, requiring, as he did, that it be an all-girls school is simply untenable because there are no such public/state schools in [State 1]. As to the second leg of his argument, namely, the standard of education issue, as demonstrated above, [School 1] (the school in which [Child 1] is presently enrolled) has recorded a higher standard of education than either of the two private schools or the public schools in the [Town 1] area.
Notably, Mr Maidwell did not offer any evidence in support of his contention that the standard of education offered by the Catholic Education Commission in [State 1] was inferior to that offered by the public education system or other private schools.
Consequently, the Tribunal finds that his philosophical objection is not reasonably founded and his argument in that respect is rejected.
Mrs Routledge provided evidence in the form of a report from[Mr D], [Child 1]’s house coordinator at [School 1] (see Exhibit B24) in which [Mr D]attests, relevantly, to [Child 1]’s having settled into [School 1] extremely well and demonstrating the many qualities of an effective operator: enthusiasm, diligence et cetera. Mrs Routledge also produced evidence in the form of certificates of academic excellence awarded by [School 1] to [Child 1] for outstanding achievement across the curriculum for year 11, 2017 and a student’s award for consistently high academic effort in class, application to study and homework and an excellent attitude to learning in year 11, 2017.
The Tribunal finds that neither parent disputes their mutual intention that [Child 1] should be educated privately. The Tribunal has rejected Mr Maidwell’s objection on philosophical grounds to his daughter being educated at a school administered by the Catholic Education Commission.
The Tribunal also relies on the decision in Wild and Ballard [1997] FamCA 41 as authority for the proposition that the relevant consideration is the type of education intended by the parents for the child rather than any particular school intended by the parents, and accordingly, the Tribunal is not required to investigate the comparative merits of the standard of education offered by private schools conducted by different religious denominations.
Consequently, the Tribunal finds that it was the parents’ mutual intention that [Child 1] be educated privately and that [School 1] is an appropriate private school for that purpose.
The Tribunal is satisfied that [Child 1] is being cared for, educated or trained in a way that both parents expected. Given that Mrs Routledge has incurred costs of $7,650 for the 2017 school year, and will incur costs of $6,401.50 for the 2018 school year, the costs of maintaining [Child 1] are significantly affected by the costs of educating her privately at [School 1], making this case special and justifying a departure from the administrative assessment of child support.

Just and equitable

The requirement to consider whether a departure would be just and equitable directs attention to what is fair to the parents and their children. Regard must be had to a variety of factors such as the needs of the children, the parents’ commitments and any hardship that would be caused by departing or not departing from the formula.

Both parents provided statements of financial circumstances.
Mr Maidwell discloses his [occupation]. He gave evidence that he is the sole director and shareholder of [Company 1], the entity through which he derives his income.
His statement of financial circumstances dated 11 May 2017 (See Exhibit A1) reports a total average weekly income of $3000. He gave evidence that he anticipates his 2017/18 financial year income will be approximately $160,000. His assets, excluding life insurance of $493,860, totalling $72,129 were unremarkable, save and except that he ascribed no value to his civil engineering business, presumably because of the personal nature of that business.
He reports accumulated superannuation of $109,750.20.
He lists liabilities of $141,076 comprising a tax debt of $25,723 and remarkably high business and personal loans totalling $115,353. Mr Maidwell acknowledged in evidence that he lives beyond his means and attributes his extravagant spending to stress and anxiety as a consequence of the breakdown of his marriage. Nevertheless, his obligation to maintain [Child 1] takes priority over his other commitments, whatever the circumstances giving rise to them.
He lists unremarkable average weekly expenses of $1,441, leaving him with a disposable weekly income of $1,559.
In evidence, Mr Maidwell acknowledged he had no objection to contributing to the costs of [Child 1]’s education at [School 3], which, the evidence before the Tribunal suggests, were higher for the 2017 school year than those of [School 1].
Mr Maidwell also gave evidence that he has yet to lodge his 2016/17 income tax return, but has lodged income estimates with the Department for the year 2016/17 and 2017/18 financial years of $169,000 and $153,000 respectively. However, there was no confirmation from the Department as to the accuracy of his evidence in this respect provided to the Tribunal as part of Exhibit 1.
Mrs Routledge’s statement of financial circumstances dated 21 January 2018 (see Exhibit B6) discloses her occupation as nurse and teacher with an average weekly gross income of $1,750.
She listed assets, totalling $22,250, against liabilities of $2,000, both of which were unremarkable.
Her average weekly expenses totalling $1,231 were also unremarkable, leaving her with a disposable weekly income of $519.
At the request of the Tribunal, Mrs Routledge provided a copy of [School 1]’s tax invoice for [Child 1]’s education costs for the 2018 school year. This tax invoice has been added to Exhibit B and marked B37. It reflects the total amount of the relevant fees and levies for the 2018 school year as a $6,401.50.
Taking into account the income, property and resources of the parents, as set out above, the Tribunal considers Mr Maidwell has the capacity to contribute to the extent of 50% of [Child 1]’s [School 1] school fees and charges for the September/December 2016 fourth term, and the 2017 and 2018 school years, such that an order in those terms would not cause undue hardship to either parent or the child and would be just and equitable in all the circumstances.

Otherwise proper

The requirement to consider whether a departure would be otherwise proper direct attention to what is fair to the community. It is necessary to consider the effect of any departure from the administrative assessment on entitlements to income-tested pensions, allowances and benefits. Increasing the amount of Mr Maidwell’s child support to reflect his contribution to his and Mrs Routledge’s daughter, [Child 1]’s 2017 and 2018 [School 1] school fees and expenses based on his income and financial resources as determined above reflected in the administrative assessment will result in an appropriate apportionment of the financial responsibility between the parents and the community. Such a result would be otherwise proper.

Conclusion

At hearing, neither parent challenged the adjusted taxable incomes currently used in the decision under review (Mr Maidwell’s 2015/16 adjusted taxable income of $225,928, and Mrs Routledge’s 2015/16 adjusted taxable income of $103,620).
Neither parent adduced any evidence in the form of invoices/business activity statements in Mr Maidwell’s case, or payslips in Mrs Routledge’s case, upon which the Tribunal could form an accurate view as to the adjusted taxable incomes of each for the 2016/17 and 2017/18 financial years, apart from the income estimates for those years provided by Mr Maidwell to the Department and his average weekly gross income reflected in his statement of financial circumstances referred to above.
Mrs Routledge’s corresponding estimate in her statement of financial circumstances reflects a gross 2016/17 taxable income of $108,613, although her average weekly gross income is recorded as $1,750, suggesting an income of $91,000 per annum.
As the objections officer has not determined the adjusted taxable incomes of the parents for those financial years, they will be reflected in the administrative assessment when the actual taxable incomes of the parents for those years are lodged with the Australian Taxation Office and reconciled by the Department in due course.
Accordingly, the Tribunal will not upset the objections officer’s decision to end DM [Mr A]’s 3 May 2016 decision on 31 December 2016. However, the objections officer has incorrectly totalled the allowable [School 1] fees and charges for the 2017 school year recorded in his decision as follows:
·Tuition fees – $2,530
·Senior school levies – $1,460
·Administration Levy – $40
·Building Levy – $472
·Parents and friends Levy – $60
·Laptop computer cost – $391
·BSD French (year 12 equivalent) – $1,348.50
·BSD German year 11) – $1,348.50
Total – $7,650

69.Accordingly, the decision to increase the rate of child support payable by Mr Maidwell for the period 1 January 2017 to 31 December 2017 by $3,201 per annum to reflect his 50% contribution to [Child 1]’s [School 1] fees for that school year should be varied to reflect the correct amount of Mr Maidwell’s contribution as $3,825.
70.As the actual amount of the [School 1] fees for the 2018 school year has been established as $6,401.50, the Tribunal considers the amount by which the objections officer has increased the rate of child support payable by Mr Maidwell for the period 1 January 2018 to 31 December 2018 should be varied from $2,590 per annum to $3,201 per annum to reflect Mr Maidwell’s 50% contribution to the fees for the 2018 school year.
DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that:

the decision of DM [Mr A] will end on 31 December 2016;
the rate of child support payable by Mr Maidwell for the period 1 January 2017 to 31 December 2017 is increased by $3,825 per annum; and

the rate of child support payable by Mr Maidwell for the period 1 January 2018 to 31 December 2018 is increased by $3,201 per annum.

[2018] AATA 1235

3 April 2018

Key Legal Topics

Areas of Law

Family Law

Administrative Law

Legal Concepts

Jurisdiction

Judicial Review

Procedural Fairness

Costs

Statutory Construction