Mcpherson and Hobson (Child support) - [2017] AATA 2863

Mcpherson and Hobson (Child support) [2017] AATA 2863 (13 November 2017)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2015/PC007851
APPLICANT:  Mr Mcpherson
OTHER PARTIES:  Child Support Registrar
Ms Hobson

TRIBUNAL:Presiding Member S Hoffman
Senior Member R Ellis

DECISION DATE: 13 November 2017
DECISION:

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

For the period from 21 January 2015 to 30 June 2015, Mr Mcpherson’s adjusted taxable income is varied to $152,926 and Ms Hobson’s adjusted taxable income is varied to $77,372.
For the period from 1 July 2015 to 25 July 2016, Mr Mcpherson’s adjusted taxable income is varied to $169,185 and Ms Hobson’s adjusted taxable income is varied to $74,785.

Presiding Member S Hoffman

CATCHWORDS
Child Support – Departure determination – Income and financial resources of parents – Business income – 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

This review is about the child support assessment in respect of the twins, [Child 1] and [Child 2], who turned 18 years old [in] July 2016. The case started in 1998 and ended on 11 November 2016. Since 5 November 2014, child support has been collected by the Department of Human Services – Child Support (the Department).[1] The twins have been in Ms Hobson’s 100% care for the period relevant to this review and Mr Mcpherson has been the parent liable to pay child support.
[1] The Department was also responsible for the collection of child support for a few months in 2000.
On 21 January 2015 Mr Mcpherson lodged an application for a change of assessment with the Department, on the basis that the administrative assessment did not correctly reflect either parent’s income, property and financial resources, or their earning capacity.
The administrative assessment in place on that date was that Mr Mcpherson’s child support liability was $30,856 a year, based on a provisional income for him for 2013/14 of $158,914, and Ms Hobson’s adjusted taxable income for 2013/14 of $28,498.
On 16 April 2015 a senior case officer from the Department decided not to depart from the administrative assessment although grounds for departure were established, on the basis that it would not be just and equitable to do so (the original decision).
On 26 June 2015 Mr Mcpherson lodged an objection to the original decision. On 6 August 2015 an objections officer from the Department decided to vary Mr Mcpherson’s adjusted taxable income to $156,000 and Ms Hobson’s adjusted taxable income to $71,700 from 21 January 2015 until a terminating event occurs (the objection decision).
On 2 September 2015 Mr Mcpherson lodged an application for review by the Administrative Appeals Tribunal (AAT). Following a directions hearing held on 4 November…

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.

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Details

Case: [2017] AATA 2863
Decision Date: 13 November 2017

CaseChat Overview and Summary

This matter concerned a child support dispute between Mr. Mcpherson and Ms. Hobson. Mr. Mcpherson sought a review of a departure determination made by the Child Support Registrar, which had varied both parties' adjusted taxable incomes. The core of the dispute revolved around the period for which the tribunal could make a departure determination, specifically whether it extended beyond 26 July 2016.

The legal issues before the tribunal were whether its jurisdiction extended to making a departure determination for a period beyond 26 July 2016, and whether the terminating event for child support assessment had occurred in July 2016 when the children turned 18. Mr. Mcpherson contended that the review was limited to the period from 21 January 2015 until a terminating event, which he believed occurred in July 2016.

The tribunal considered subsection 12(1) of the Child Support (Registration and Collection) Act 1988, which defines a child support terminating event, and noted that paragraph 12(1)(c) is subject to section 151C. It found that the assessment continued until November 2016 as the children finished school, meaning the terminating event that would otherwise have occurred in July 2016 was affected by section 151C. Citing *Child Support Registrar & Ahern and Anor* [2014] FamCAFC 105, the tribunal affirmed its jurisdiction under section 103T(1) of the Collection Act to make a departure determination that applies to a period beyond 26 July 2016. The tribunal also noted that while Mr. Mcpherson agreed with the decision of 12 September 2016, Ms. Hobson did not, but chose not to appeal. As Ms. Hobson did not object to that decision, the tribunal determined not to disturb it.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Separate to this change of assessment process, Mr Mcpherson lodged a change of assessment application on 26 July 2016. A decision was made on 12 September 2016 to vary Ms Hobson’s adjusted taxable income from 26 July 2016 to a terminating event to $138,079.[9] Mr Mcpherson said that level of income for Ms Hobson was closer to what he thinks it should be although he did not agree with all of the reasoning in that decision. [9] The decision also varied Mr Mcpherson’s adjusted taxable income for the same period to $169,185 a year. Mr Mcpherson argued that for this tribunal to consider the period from 26 July 2016 to when the case ended on 11 November 2016 was beyond the scope of this review, on the basis that this review was a review of an objection decision to vary the parties’ adjusted taxable incomes from 21 January 2015 until a terminating event occurs. Mr Mcpherson said at the hearing on 17 October 2017 that he was told by a departmental officer that there was a terminating event when the children of the case turned 18 years old [in] July 2016. Subsection 12(1) of the Act sets out when a child support terminating event happens. Paragraph 12(1)(c) specifies that a child support terminating event happens when a child turns 18 years old. Subsection 12(1) of the Act is followed by a note that paragraph (12)(1)(c) may be affected by section 151C of the Act, which deals with continuing administrative assessments and child support agreements beyond a child's 18th birthday in certain situations. In this case the assessment of child support continued until the children finished school, [in] November 2016 ([Child 1]) and [shortly after in] November 2016 ([Child 2]). The tribunal is satisfied that the terminating event that would otherwise have occurred [in] July 2016 was affected by the application of section 151C of the Act, and therefore a terminating event did not happen [in] July 2016. Further, in Ahern the Full Court of the Family Court considered whether there were limitations regarding the tribunal’s jurisdiction in relation to periods for which it could make determinations.[10] It stated that:…the [tribunal] had by virtue of s 103T(1) of the Collection Act all the powers of the Registrar under Part 6A of the Assessment Act, including the powers in s 98S to make a departure determination in terms not sought in the application for a departure.[10] Child Support Registrar & Ahern and Anor [2014] FamCAFC 105. The tribunal is satisfied that it has the jurisdiction to make a departure determination in this case (that is, a decision which varies a child support assessment) that applies to a period beyond 26 July 2016. The tribunal notes that while Mr Mcpherson said that he agreed with the decision made on 12 September 2016, Ms Hobson said that she did not agree with it but as the child support case was coming to an end, she chose not to appeal it. As Ms Hobson chose not to object to the decision made 12 September 2016, the tribunal has determined not to disturb that decision.

Ratio Decidendi

Legal Principle Established

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