Mallinson and Springall (Child support) - [2024] AATA 3237

Mallinson and Springall (Child support) [2024] AATA 3237 (26 July 2024)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2024/MC027469
APPLICANT:  Mr Mallinson
OTHER PARTIES:  Child Support Registrar
Ms Springall

TRIBUNAL:Member R Anderson
DECISION DATE: 26 July 2024
DECISION:

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

· The ATI of Mr Mallinson is to be varied to $108,000 for the period 2 June 2023 to 31 October 2026.

CATCHWORDS
CHILD SUPPORT – departure from the administrative assessment – income, property and financial resources – father’s adjusted taxable income – former employee of parents’ business now sole trader through different entity – progressive purchases of business equipment and new vehicles – variable business activities and income throughout year – additional financial benefits – drawings, use of vehicles, and personal expenses – over- and under-assessed in earlier periods, and consistently under-assessed in later periods – financial needs of mother and children – father’s current arrears – 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 omitted 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 Mallinson and Ms Springall are the separated parents of [Children 1 and 2]. According to records of Services Australia – Child Support (Child Support), the child support assessment was registered on 10 June 2016. Child Support has been responsible for collection of child support from Mr Mallinson since 21 March 2022.
The child support liability was initially calculated in accordance with the administrative assessment, as provided in the Child Support (Assessment) Act 1989 (the Act). The calculation was based on the income recorded by each parent in their most recently completed income tax returns, as lodged with the Australian Taxation Office or estimates accepted by Child Support. In the case of Mr Mallinson his adjusted taxable incomes (ATIs) for the period 2 June 2023 to 30 June 2023 and for the 2023/24 financial year were based on estimates.
It is open to either parent to lodge a change of assessment or departure application to depart from the administrative assessment under Part 6A of the Act, if they consider the administrative assessment results in an unfair amount of child support payable by one parent. Ms Springall lodged such an application on 8 June 2023. This application resulted in a delegate of the Child Support Registrar departing from the administrative assessment on 3 October 2023 and varying the ATI of Mr Mallinson to $133,200 for the period 2 June 2023 to 1 June 2025. This was on the basis that the administrative assessment produced an unfair outcome due to the income, property and financial resources of the parents (Reason 8). The departure decision resulted in Mr Mallinson’s annual child support liability increasing from $1,202 to $16,598.
On 25 October 2023,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Mallinson and Springall (Child support)

Details

AGLC: Mallinson and Springall (Child support) [2024] AATA 3237
Case: [2024] AATA 3237
Decision Date: 26 July 2024

CaseChat Overview and Summary

The case of *Mallinson and Springall* concerned an application to depart from a child support administrative assessment. The dispute involved the father's income, property, and financial resources, and the mother's application to have the assessment varied to better reflect the father's actual financial capacity and the needs of the children. The matter was heard by Member R Anderson.

The primary legal issue before the court was whether the father's adjusted taxable income, as determined for the purposes of the child support assessment, accurately reflected his true financial position. Specifically, the court had to consider whether certain financial benefits and the progressive acquisition of business assets and vehicles by the father, who had transitioned from employment with his parents' business to operating as a sole trader through a different entity, constituted income or financial resources that should be taken into account. The court also had to consider the impact of variable business activities and income, additional financial benefits received, and the father's current arrears on the assessment.

Member R Anderson reasoned that the father's financial arrangements, including drawings, use of vehicles, and the payment of personal expenses through his business, indicated a capacity to pay more child support than was being assessed. The court noted that the father had been over- and under-assessed in earlier periods and consistently under-assessed in later periods, suggesting a pattern of income concealment or under-reporting. Applying the principles of child support legislation, which aims to ensure that both parents contribute to the financial needs of their children, the court found that the administrative assessment did not adequately reflect the father's financial capacity and the children's needs.

Consequently, the decision under review was set aside and substituted with a new assessment that took into account the father's broader financial position and benefits.

Orders