Marner and Child Support Registrar (Child support) - [2023] AATA 2947

Marner and Child Support Registrar (Child support) [2023] AATA 2947 (21 August 2023)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2023/PC025892
APPLICANT:  Ms Marner
OTHER PARTIES:  Child Support Registrar
TRIBUNAL:Member M Martellotta
DECISION DATE:  21 August 2023
DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object - no satisfactory explanation for the delay – no merit - weighing all factors the extension of time was correctly refused - decision under review affirmed

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

This review concerns a decision made by Services Australia (Child Support) to refuse Ms Marner an extension of time within which to object to a decision.
According to Child Support records, on 30 November 2022 they decided to end the child support case on the basis that the payer ceased to be a resident of Australia or of a reciprocating jurisdiction.
Ms Marner objected to the decision on 13 February 2023. In considering her objection, Child Support considered her application for an extension of time within which to object.
On 22 March 2023 Child Support refused to grant an extension of time. Ms Marner has asked the tribunal to review that decision.
On 16 August 2023 Ms Marner attended a telephone hearing to present her evidence and submissions. Other evidence before the tribunal included the Child Support file. Ms Marner advised she would provide evidence in support of submissions made at hearing. No further evidence was provided.[1]

ISSUES

[1] At hearing the applicant advised she could provide that information by COB of the hearing date. Outreach attempts were unsuccessful and at the date of decision no further evidence had been provided.

The statutory provisions relevant to this review are contained in Part VII of the Child Support (Registration and Collection) Act1988 (the Act).
The issue which arises in this case is, should Ms Marner be granted an extension of time to lodge her objection to a decision made by Child Support?

CONSIDERATION OF EVIDENCE, SUBMISSIONS AND THE LAW

Section 80 of the Act provides that a person may lodge an objection in writing to Child Support in relation to specified decisions made by Child Support. This includes decisions to accept an estimate of income. Section 81 of the Act provides that a person must lodge an objection to such a decision within 28 days after a notice of the decision is served on them.
In cases where the lodgement period has passed, a person may send an objection along with an extension of time application requesting Child Support to treat the objection as having been duly lodged (section 82 of the Act). The application must state fully and in detail the grounds of the application, including the circumstances concerning, and the reasons for, the failure by the person to lodge the objection in time.
Child Support must consider and either grant or refuse the application for an extension of time. If the application is granted, then the person is taken to have lodged the objection (section 83 of the Act). If the application is not granted, a person may apply to this tribunal for review of a decision on an application for an extension of time (section 89 of the Act).
The exercise of the discretion as to whether or not to grant an extension of time is on the basis of whether it is reasonable or proper to grant the application. A number of decisions provide guidance to the tribunal in determining this issue. It is clear from those decisions that the statutory time limit of 28 days is to be enforced unless there are acceptable reasons for departing from this prescribed timeframe.
In Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, the High Court noted that while an extension of time is the exception to the general rule, there are legislative provisions which in the circumstances of the facts of an individual case, may indicate that justice is served by the general rule being overruled.
The Federal Court in Hunter Valley Developments v Cohen (1984) 3 FCR 344 (Hunter Valley Developments) noted that in general, applications or proceedings commenced outside of a prescribed time limit will not be considered. The court also said that there must be an acceptable explanation for the delay and that it must be fair and equitable in the circumstances to extend time. The Federal Court identified six factors to take into account when deciding whether to grant an extension of time:
·     The reasons for the delay and whether the applicant rested on their rights or took action to make the decision-maker aware that the decision was being contested;
·     Any prejudice to the other party including any difficulties that they will experience in providing evidence as a result of the delay;
·     Any wider prejudice to the general public;
·     Fairness in granting an extension of time as between the applicant and other persons in a similar position;
·     The merits of the substantive application;
·     Whether it is proper to grant the extension of time.
In Brown v Commissioner of Taxation [1999] FCA 563, Hill J reviewed the principles set out in Hunter Valley Developments and noted that those factors serve as a guide and were not exhaustive. In light of the approach by the tribunal in more recent times in cases such as Vickers and Child Support Agency [2006] AATA 112 and McConnell and Child Support Registrar [2005] AATA 342, and being mindful that the Hunter Valley Developments factors are only a “guide”, the tribunal has taken these factors into account in determining whether the extension of time should be granted in this case.

Did Ms Marner rest on her rights?

Ms Marner gave evidence that she received the original notice of decision. She understood the decision that she had 28 days in which to make her objection but decided that there was no point even though she didn’t agree with the decision. She decided that she would instead pursue the option of seeking a maintenance order through the courts.
She did not action that decision until February 2023 because over the school holidays she was not receiving employment income and could not afford to obtain legal advice. An application was initiated but the court advised that she had to first exhaust her review rights with Child Support. This is what prompted her make her objection with Child Support.
In this matter Ms Marner does not contest that she received notice of the original decision. Her evidence was that she made a conscious decision not to object and instead decided to seek advice in the new year about seeking a court order.
The tribunal is satisfied that with respect to deciding whether or not to object to the decision Ms Marner made a conscious decision not to pursue her objection rights. The tribunal is satisfied that she rested on her rights.

Is there any prejudice to the other party?

The other party would potentially be prejudiced in the sense that if the objection was granted and succeeded, it would mean that he would have an ongoing child support liability which could result in an increase of arrears owed.
On balance, the tribunal is satisfied that in these circumstances, to grant the extension of time would cause prejudice to the other party.

Prejudice to the general public

The tribunal is cognisant of the general public’s expectation that government agencies and statutory bodies perform their functions quickly and fairly to promote reliable outcomes in the most cost-effective manner. At the same time, the tribunal notes that it is also important to consider individual circumstances.
In this matter the tribunal has concluded that Ms Marner rested on her rights and that those individual interests do not outweigh the public interest.

Does the substantive application have merit?

In DHLD and Executive Director, Social Security Appeals Tribunal [2010] AATA 377 the tribunal stated that when considering the question of merits in the context of an application seeking an extension of time:
it is not the occasion on which to embark upon a detailed consideration of the evidence and the merits. The question that must be asked is whether the applicant on the extension application has an arguable case. If, at a substantive hearing, that applicant were able to produce evidence to establish the facts he or she put forward on the extension application, would he or she have an arguable case having regard to the facts put forward and the law against which those facts must be considered?[2]
[2] At [53]
In the matter of Brown v Commissioner of Taxation[3] the court stated that:
an applicant should show that he or she has an arguable case. No doubt if the objection on the face of it is one which is frivolous or bound to fail as a matter of law it would be a futility to permit an extension of time to enable it to be considered. But this points to quite a low threshold. What is involved is whether the objection on its face discloses a case which is arguable, not whether having regard to other matters, including evidence which may not even be known to the taxpayer at the time of making the application, the case is one that the taxpayer will or will probably lose.[4]
[3] [1999] FCA 563
[4] At [56]
In this case the substantive application relates to whether the other parent is resident for child support purposes. Ms Marner stated that the other party left Australia in 2020. Since then, he has lived in [Country 1] and more recently she believes he has moved to [Country 2]. She is not aware of his circumstances other than that he is employed by a company based in Asia. She believes that he has established a home with his [girlfriend]. She believes he continues to own a property in Australia which he owned with a former partner who is deceased. She obtained a search of the property title which shows that he is a tenant in common and the title is subject to a mortgage. Ms Marner stated that once she has exhausted the review rights with Child Support she will be able to resume her application in the court.
The original decision was based upon an assessment made by Child Support which concluded that the other party has been absent from Australia since October 2020. A review of his bank accounts shows that there has been no activity on those accounts since departure and they hold a nil or minimal balance. He has no place of residence in Australia and otherwise has no financial ties in this country.
Section 10 of the Child Support (Assessment) Act 1989 and section 4 of the Act interpret the meaning of resident of Australia as follows:
For the purposes of this Act, a person is a resident of Australia on a day if on that day the person is a resident of Australia for the purposes of the Income Tax Assessment Act 1936.[5]
[5] For the purposes of the Act the definition does not include a person who is resident of a reciprocating jurisdiction.
Section 6 of the Income Tax Assessment Act 1936 provides:
resident or resident of Australia means:
(a) a person, other than a company, who resides in Australia and includes a person:
(i)whose domicile is in Australia, unless the Commissioner is satisfied that the person’s permanent place of abode is outside Australia;
(ii)who has actually been in Australia, continuously or intermittently, during more than one‑half of the year of income, unless the Commissioner is satisfied that the person’s usual place of abode is outside Australia and that the person does not intend to take up residence in Australia; or
(iii)who is:
(A) a member of the superannuation scheme established by deed under the Superannuation Act 1990; or
(B) an eligible employee for the purposes of the Superannuation Act 1976; or
(C) the spouse, or a child under 16, of a person covered by sub‑subparagraph (A) or (B); and
(b) a company which is incorporated in Australia, or which, not being incorporated in Australia, carries on business in Australia, and has either its central management and control in Australia, or its voting power controlled by shareholders who are residents of Australia.
The resides test is the primary test of tax residency. The ordinary meaning of resides is used to decide who is an Australian resident for income tax purposes:
The Shorter Oxford Dictionary defines reside as:
'...to dwell permanently, or for a considerable time, to have one's settled or usual abode, to live, in or at a particular place...'[6]
[6] Residency – the resides test | Australian Taxation Office (ato.gov.au) (accessed 1/3/23).
Relevant factors taken into consideration under this test include the physical presence of the person, their intention and purpose, whether they have family, business or employment ties to Australia, where they maintain and locate their assets and their social and living arrangements.
Where a person does not satisfy the resides test a person will still be considered a resident of Australia if they satisfy one of the three statutory tests.
The domicile test[7] provides that a person is a resident of Australia, if their domicile (the place that is their permanent home) is in Australia unless the Commissioner of Taxation is satisfied that their permanent place of abode is outside of Australia.
[7] Page 9, TR2022/D2 which references the Domicile Act 1982 and relevant authorities.
Domicile is a place that is considered by law to be a person’s permanent home and is usually something more than a residence. Types of domiciles include, domicile by origin which is attributed to everyone at their birth; domicile by choice which is inferred by law where there is both a change of residence and an intention to make the change permanent or indefinite; and domicile by operation of law which is where it is imposed by law.
According to the ATO, a person who has always lived in Australia will retain a domicile in this country even when absent overseas unless they choose to permanently migrate to another country. A person can only have one domicile at any point in time and a person’s domicile continues until they acquire another one; it cannot be abandoned without replacement. For a person to acquire a domicile by choice a person must have a lawful physical presence in that country and an intention to make that country indefinitely their home.
On balance, if further relevant information were to be provided on objection, there may be an arguable case dependant on what that information was however, on the available evidence the tribunal was not satisfied that there was merit in the substantive application.

Fairness in granting an extension of time as between the applicant and other persons in a similar position

The tribunal next considered the fairness between the applicant and other persons in a like position and concluded that it was not satisfied that other persons in a similar position would be placed in an unfair position if the extension were granted. Parents under the child support scheme have the capacity to object to specific decisions of the Registrar and can seek an extension of time to lodge an objection. The outcome will be wholly dependent on the circumstances of the particular case.

Should Ms Marner be granted an extension of time?

In this matter however the tribunal has concluded that Ms Marner has rested on her rights. The tribunal has also concluded that there would be prejudice to the other party and to the general public in granting an extension of time and on balance the tribunal is not satisfied that there is merit in the substantive application. For these reasons, the tribunal concluded that this was not a case in which there is sufficient merit such as to warrant an extension of time.
As noted, relevant authorities confirm the prima facie rule that proceedings outside of legislated prescribed periods will not be entertained unless it is proper to do so. Parliament has prescribed timeframes in child support legislation for lodging objections to decisions made by Child Support. Other persons in a like position to Ms Marner are similarly advised and are subject to those prescribed timeframes.
The tribunal decides not to grant an extension of time within which to lodge an objection to Child Support’s decision made on 30 November 2022.

DECISION

The decision under review is affirmed.