MDXJ and Secretary, Department of Social Services (Social services second review)
[2019] AATA 177
•19 February 2019
MDXJ and Secretary, Department of Social Services (Social services second review) [2019] AATA 177 (19 February 2019)
Division:GENERAL DIVISION
File Number: 2017/7214
Re:MDXJ
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
AndSVPX
OTHER PARTY
DIRECTIONS ON PRELIMINARY ISSUE
Tribunal:Member M Kennedy
Date:19 February 2019
Place:Adelaide
The request to issue summonses is refused.
The matter is to be listed for a further hearing at a date to be advised by the Registry for the parties to be heard on the issue of final orders and the decision in the reviews.
................................[Sgnd]........................................
Member M Kennedy
CATCHWORDS
SOCIAL SECURITY – Family Tax Benefit – percentage of care – care arrangement – request to issue summons – whether section 35C of A New Tax System (Family Assistance) Act 1999 applies – interrelationship of legislative provisions – whether the family court order was in force at the relevant time – request to issue summons refused.
LEGISLATION
A New Tax System (Family Assistance) Act 1999
Family Assistance and Child Support Legislation Amendment (Protecting Children) Act 2018
Family Law Act 1975
CASES
Arnold and Secretary, Department of Social Services [2016] AATA 1080
Gravis and Major [2010] FamCAFC 239
Re Proctor and Commissioner of Taxation [2005] AATA 389
[Family law appellate proceedings] [2017] FamCAFC 207REASONS FOR DECISION
Member M Kennedy
13 February 2019
INTRODUCTION
Both MDXJ and SVPX have applied for a second-tier review of a decision of the Social Services and Child Support Division (Tier 1) of the Tribunal dated 30 October 2017. The decision relates to MDXJ’s entitlement to Family Tax Benefit (FTB) in circumstances where there was a change to care arrangements in respect of MDXJ and SVPX’s son (Child A).
This is a decision record arising out of an interlocutory hearing conducted on 4 September 2018 to consider a discrete part of the review. MDXJ has applied to the Tribunal to issue a number of summonses to third parties. The Registry has refused to issue the summonses and referred the matter to a Tribunal member for a decision about the issue of the summonses.
The summonses may relate, on the face of it, to evidence potentially relevant to a very broad discretion addressing whether ‘special circumstances’ are present for the purpose of extending an interim care period. Despite the superficial appearance of relevance of the witnesses and evidence sought by the summons, the compulsory involvement of third parties (such as teachers and doctors) in proceedings of this nature should be required only as a last resort.
It appeared to me however, having regard to the differing approaches between the authorised review officer (ARO) and the Tribunal at Tier 1, that the matter called first of all for the resolution of a preliminary matter which may limit the scope of what evidence may be relevant, and may in fact reveal that the proposed evidence is not relevant to the review.
The Tribunal’s decision at Tier 1 turned in part on the exercise of the discretion within section 35L of the A New Tax System (Family Assistance) Act 1999 (Family Assistance Act) in the context of potentially informative appeal proceedings in the Family Court having yet to be resolved. The material and witnesses called for in the summons may arguably be relevant to the exercise of that discretion, but I note also that where a discretion is expressed in such general terms, it is difficult to rule out any particular topic of evidence as irrelevant.
The ARO’s decision however was made on the basis that the preliminary criteria for an interim care determination (under section 35C of the Family Assistance Act) were not made out. The preliminary issue I have identified therefore is whether section 35C of the Family Assistance Act has any application to this review. If it does not, then the basis for issuing the summonses for the purpose of the discretion in section 35L does not arise. There are however a number of layers of complexity to the answer to that question, including evidence about contravention proceedings in the Federal Circuit Court, an appeal to the Full Family Court, the status of communications about care arrangements for Child A and the interrelationship between section 35C and section 23 of the Family Assistance Act.
It is necessary to elaborate on these issues to be resolved by reference to the procedural background and the applicable legislative scheme.
PROCEDURAL BACKGROUND
On 21 December 2016, SVPX notified Centrelink that there had been a change to Child A’s care arrangements, and informed Centrelink that Child A was now 100% in her care. Previously, Centrelink had calculated FTB on the basis that Child A was in MDXJ’s care 40% of the time. The fact that Child A has not been in MDXJ’s care since 15 September 2016 is not disputed, although the circumstances and context that brought about that development is a matter of deep contention.
Centrelink decided that an ‘interim’ care period would apply on the basis that MDXJ had taken reasonable action to again have Child A in his care, and decided on that basis that MDXJ would have 40% care and SVPX would have 60% care for the purpose of calculating FTB for a period of 14 weeks:[1] It is apparent from the brief record of that primary decision that at that time Centrelink was satisfied that prior to the date of the change of care arrangements, the parties had been following court ordered care, and the parties had gone to court for recovery.
[1] T38, page 201.
SVPX applied for internal review of that decision. On 4 July 2017, an ARO noted that a Judge of the Federal Circuit Court had found that prior to September 2016, MDXJ and SVPX had negotiated a private and informal agreement in respect of parenting arrangements, and as such concluded an interim care period could not apply. The ARO decided that the care determination should be 100% to SVPX from 15 September 2016, noting that to be the first date the parties were agreed that Child A was not actually in MDXJ’s care.
MDXJ applied to the Tribunal for review of that decision. On 30 October 2017, Tier 1 decided that an interim care period did apply, and that during the interim care period MDXJ would have a care determination of 40%. In reaching this view, the Tribunal decided, by implication from the evidence of the parties, that there was in existence a written agreement about the care of the children being followed by the parents. However, the Tribunal also decided that Child A would be an FTB child in respect of MDXJ only until 17 November 2016, finding in the exercise of the discretion in subsection 23(5A) of the Family Assistance Act that special circumstances existed, and noted that the discretion so exercised also dealt with the issue of when the interim care period would cease pursuant to section 35L of the Family Assistance Act.
Both MDXJ and SVPX applied to the second tier of the Tribunal for review.
LEGISLATIVE SCHEME
The legislative scheme applicable to this review is complex, with a number of moving parts. In particular, in the course of these reasons I reach findings on an issue raised late in the hearing and proceeding on written submissions, namely the nature of the interaction between two separate provisions of the Family Assistance Act, that on the face of it appear to deal with the same issue.
First, I record that I have turned my mind to recent significant reforms to the applicable legislation made by the Family Assistance and Child Support Legislation Amendment (Protecting Children) Act 2018. I am satisfied, having examined the application provisions and noted the date of Royal assent that the changes to the legislative scheme introduced have no application to the decision before the Tribunal.
In relation to FTB generally, a person is eligible for FTB if, among other requirements, they have an ‘FTB child’. Section 22 of the Family Assistance Act provides for when a child will be an FTB child of another individual, with each of the subsections including a requirement that the child be in the adult’s care. However, section 22 must be read subject to a range of provisions which then follow.
One such elaboration is provided for at section 23 of the Family Assistance Act. The provision provides for circumstances in which the child remains an FTB child of the adult when the child ceases to be in the individual’s care without their consent. It requires, among other things, that an event occurs in relation to the child without the adult’s consent, that prevents the child being in the adult’s care, and the adult takes reasonable steps to have the child again in the adult’s care, provided that the child would have been an FTB child under section 22(2) or 22(3) during the ‘qualifying period’ if the child had not ceased to be in the adult’s care and, relevantly, the adult is legally responsible (whether alone or jointly with someone else) for the day to day care, welfare and development of the child, or there is a family court order in place.
This is one of the provisions I must consider and address further at the conclusion of my reasons once I have reached critical findings of fact.
Section 59 of the Family Assistance Act provides for circumstances where two or more adults who are not members of the same couple. This provision is found in Part 4 of the Family Assistance Act which deals with the rate of family assistance. Specifically, it provides that where the Secretary has determined a percentage of care for the child during a care period, and that percentage is at least 35% and not more than 65%, then the person has a ‘shared care percentage’ determined in accordance with a table at subsection 59(2) of the Family Assistance Act. The ‘shared care percentage’ thus calculated is then applied in the Family Tax Benefit Rate Calculator at Schedule 1 to the Family Assistance Act (item 11), essentially the FTB rate is proportional to the shared care percentage.
Section 25 of the Family Assistance Act reflects and complements section 59 of the Family Assistance Act by expressly providing that if an individual’s percentage of care for a child is less than 35%, then the child is taken, despite section 22, not to be an FTB child of the individual for any part of the period.
Sections 59 and 25 rely on the concept of the Secretary determining a percentage of care for a child. The determination of percentage of care is provided for by subdivision D of Part 3, Division 1 of the Family Assistance Act. The scheme set out in that subdivision involves the determination of a percentage of care for a child for an individual, circumstances in which such a determination may or must be revoked, and the replacement of a revoked determination with a new one.
Relevant and determinative of this matter is section 35C of the Family Assistance Act. Section 35C makes provision for what is to happen if the actual care of a child, that an adult has had or will have during a care period, does not comply with the extent of care that the adult should have had or is to have under the care arrangement during the care period, and the individual with reduced care has taken reasonable action to ensure that the care arrangement is complied with.
Where section 35C applies (and whether or not it applies is a critical question in this review), the Secretary must determine two percentages of care, with the first corresponding with the extent of care that the adult should have had or is to have under the care arrangement, and the second is either nil or a percentage that corresponds with the actual care of the child that the Secretary is satisfied that the adult would have during the care period if the reasonable action taken to ensure that the care arrangement is complied with were unsuccessful.
If section 35C applies to an individual, and two such determinations are made, then:
(a)the first determination applies during an interim period, and the second determination applies after the end of the interim period (assuming there is no earlier revocation of the determinations), pursuant to subsection 35L(1)(c) and (d) of the Family Assistance Act;
(b)the interim period starts on the ‘application day’ for the determination and ends on one of a number of alternative days, pursuant to subsection 35L(2);
(c)one of the alternatives is a ‘day specified by the Secretary’, which must be the last day in a 14 week period that starts on the change of care day (or such longer period as is specified under subsection 35L(4)), pursuant to subsection 35L(3); but
(d)two provisions exist to create discretion to either lengthen the period to up to 26 weeks, or to identify a day earlier than the day identified under subsection 35L(3).
The interaction and relationship between section 35C and section 23 of the Family Assistance Act is the issue I will address at the conclusion of these reasons.
As mentioned above the determinative issue in my view is whether section 35C applies in the first place. In order to address that question, I reproduce subsection 35C(1) and some further definitions of terminology used in that subsection:
35CPercentage of care if action taken to ensure that a care arrangement in relation to a child is complied with
(1)This section applies in relation to an individual (the adult) if:
(a) a care arrangement applies in relation to a child; and
(b)the Secretary is satisfied that the actual care of the child that the adult has had, or will have, during a care period does not comply with the extent of care of the child that the adult should have had, or is to have, under the care arrangement during the care period (which may be nil); and
(c)an individual who has reduced care of the child has taken reasonable action to ensure that the care arrangement is complied with.
…
In this Act, unless the contrary intention appears, care arrangement has the following definition:
3 Definitions
…
care arrangement in relation to a child means:
(a)a written agreement between the parents of the child, or between a parent of the child and another person who cares for the child, that relates to the care of the child; or
(b) a parenting plan for the child; or
(c) any of the following orders relating to the child:
(i)a family violence order within the meaning of section 4 of the Family Law Act 1975;
(ii) a parenting order within the meaning of section 64B of that Act;
(iii)a State child order registered in accordance with section 70D of that Act;(iv) an overseas child order registered in accordance with section 70G of that Act.
DOES A ‘CARE ARRANGEMENT’ APPLY IN RELATION TO CHILD A?
Before turning to the evidence as to whether or not a care arrangement applied in relation to Child A, it is first necessary to identify at what point in time that question is to be answered.
In my view, having regard to the scheme of subdivision D of Part 3, Division 1 of the Family Assistance Act, the relevant time to question whether a care arrangement applied in relation to Child A is the ‘change of care day’. In this regard, I reject MDXJ’s contentions to the contrary.
The reason for my conclusion in this regard is because, as mentioned above, the scheme of subdivision D of Part 3, Division 1 of the Family Assistance Act is a scheme whereby care determinations continue in force unless and until they are revoked. The question of whether a new percentage of care determination is to be made in accordance with section 35C does not arise until such time as an existing care determination is first revoked. This is clear, for example, in the framing of section 35A(2) which refers to section 35C upon the revocation of an earlier determination (with the exception being an initial determination – but that is not relevant in this case).
Relevantly, the circumstances in which an existing care determination is revoked is provided for by subdivision E of Part 3, Division 1 of the Family Assistance Act, and the timing of that revocation is provided for at subsection 35Q(2) of the Family Assistance Act.
Relevantly, an existing care determination must or may be revoked where the Secretary or Child Support Registrar is notified or otherwise becomes aware that the care of the child that is actually taking place does not correspond with the individual’s existing percentage of care for the child. If a new care determination were to be made under applicable provisions (excluding section 35C for this purpose), then:
(a)the shared care percentage would change, or the percentage of care would not be in the same ‘range’ (which is then defined); or
(b)the percentage would not be the same as the existing percentage.
In the first case, the existing care determination must be revoked. In the second case, the existing care determination may be revoked pursuant to sections 35P and 35Q of the Family Assistance Act respectively.
In the case of a revocation under section 35P and 35Q, relevantly, the revocation takes effect on the day before the ‘change of care day’ for the individual. The term ‘change of care day’ is defined in section 4 of the Family Assistance Act to mean (relevantly) the first day on which the care of the child that was actually taking place ceased to correspond with the individual’s percentage of care for the child under the determination.
It follows therefore that the question of whether section 35C applies does not arise until such time as the existing care determination has been revoked (being the day before the change of care day), and so in my view testing the application of section 35C is to be undertaken by reference to the change of care day. In the case of Child A, that day is 15 September 2016. It is clear that on that day under the previous circumstances regulating care arrangements for Child A, he was scheduled to enter MDXJ’s care but did not do so. I also understand that it is not in dispute that Child A has not been in MDXJ’s care since that day.
So the question is therefore whether a care arrangement applied in relation to Child A on 15 September 2016. Hereafter, references to ‘the relevant time’ refer to 15 September 2016.
The court order of 4 December 2013
A court order of Justice Dawe of 4 December 2013 had regulated care of Child A and formed the basis of the care percentage determination for family assistance purposes for some time. An order of that nature is clearly a ‘care arrangement’ for the purposes of section 35C.
MDXJ contends that no private agreement was ever entered into that changed the percentage of care provided for by those orders. He contends that the orders were never cancelled, suspended or modified in any way, and so continued to operate as a care arrangement between the parties. MDXJ alleges that there were prior contraventions of the court order, and these events did not constitute a change to the care arrangement. While it may be accepted that the orders of Dawe J were not changed, the question remains whether the care arrangement represented by the court order ‘applied’ at the relevant time.
On that question, it is necessary to refer to ex tempore reasons for Judgment of Justice Berman on a contravention application brought by MDXJ against SVPX.[2]
[2] T28.
In considering the contravention application, his Honour noted the allegation (the second count) that SVPX had refused to give Child A contact with his father for Thursday to Monday commencing 15 September 2016, and concluding 19 September 2016. MDXJ had argued this was a breach of order 3(b) of the orders dated 4 December 2013. SVPX pleaded not guilty.
His Honour recounted his understanding of the circumstances behind the allegation, in that an orthodontic appointment had been arranged for Child A, which MDXJ believed had been done deliberately to interfere with the time he was to have with Child A under the orders. However, before making findings about contentions of that nature, his Honour identified a more fundamental issue for the purposes of the contravention application arising out of evidence given by MDXJ and SVPX to the effect that prior to September of 2016, they had negotiated a private and informal agreement in respect of parenting arrangements. His Honour stated that he considered that by their informal agreement the parties had effectively suspended the relevant aspects of the order of 4 December 2013.
Focusing on the contravention proceedings, his Honour observed that proceedings of that nature are punitive and require a level of proof and precision in terms and detail not normally the case when the Court is considering parenting arrangements. His Honour found that from 15 September 2016 to 19 September 2019, the arrangement in place was an informal agreement reached between the parties and not the Court order.
His Honour later referred to the existence of a clear agreement ‘in writing’,[3] but in that paragraph his Honour speaks of principles in abstract, and I will later turn to the evidence before me about whether I can be satisfied that there was any such informal agreement in writing. His Honour found that MDXJ could not rely upon a breach of an order that was effectively suspended. The Court dismissed the application.
[3] T28, p 137 at [32].
MDXJ appealed that decision to the Full Family Court. The Full Court dismissed MDXJ’s appeal[4]. Amongst the observations made by the Full Court, Thackery J observed that Berman J was entirely correct to consider that the arrangement that was in place was an informal one, and it would be inappropriate to find that the mother had any case to answer in relation to a contravention of an order.
[4] [2017] FamCAFC 207
As mentioned above, the conclusion of Berman J in the context of a contravention application was noted and relied upon by the ARO in concluding that an interim care period could not apply.
MDXJ contends that the decision of Berman J must be understood in the context of contravention proceedings. MDXJ contends that the statements made by Berman J (I note now relevantly endorsed by the Full Family Court) were in the context of quasi criminal proceedings and cannot be relied upon to conclude that the care arrangements that previously applied did not apply. In this way, MDXJ seeks to limit the relevance of the conclusion of the Family Court to the contravention proceedings only, and argues that the findings have no application for the purpose of family assistance.
MDXJ contends that I should have regard to other evidence of communications between the parents that he was not permitted to rely upon in the Full Family Court, which set out the precise nature of the private agreement between the parties. I have done so closely in the course of these proceedings, but consider these documents more relevant to the question of whether some other form of ‘care arrangement’ (for family assistance purposes) was in place at the relevant time.
MDXJ further relies on remarks made by the Full Court in Gravis and Major [2010] FamCAFC 239 regarding the nature of court orders providing a template around which a parent can build their time with their children. MDXJ contends that the decision is authority for the proposition that the courts encourage parents to be flexible with contact arrangements and this may be inconsistent with a contention that, for family assistance purposes, any departure from a parenting order for the benefit of a child can justify a finding that the care arrangement does not apply.
The Secretary, in the Statement of Facts and Contentions of 4 June 2018 noted that the orders of 4 December 2013 could have force as a care arrangement, but left for the Tribunal’s consideration whether subsequent informal agreements varied part of the order. With the greater focus I have given in these proceedings on whether the care arrangement applies, the Secretary has made further submissions addressing the question of whether a care arrangement can be varied.
In this regard, the Secretary contends that there is no mechanism in the Family Assistance Act for an existing care arrangement to be varied. The Secretary contends that in the absence of any such mechanism, a valid care arrangement can be supplemented by any other subsequent valid care arrangement, thus extinguishing the original care arrangement. The Secretary observes also that there is no scope in the legislation for a patchwork of agreements, and the legislation does not contemplate two care arrangements operating at the same time. The Secretary took no position on the question of whether the 2013 orders were supplanted by a subsequent valid agreement.
I agree with the Secretary’s contentions that the family assistance legislation I have referred to in these reasons does not facilitate a patchwork of agreements. The term ‘care arrangement’ is a defined term, and is required to have certain characteristics. In one sense however, the concept of a ‘variation’ of an existing agreement and its supplementation by another agreement can blur. For example, if parents agree in writing to depart from a particular aspect of a court order, and agree to preserve all remaining aspects of the court order, whether the operative care arrangement is seen as a variation or an exercise in replacing one care arrangement with another is largely academic. In my view, that will not be the case if the parents agree to not follow an aspect of a court order, but the characteristics of that agreement do not meet the legislative test for what may constitute a care arrangement for the purposes of family assistance law.
I consider it clear on the facts of this case, as found by Berman J and confirmed by the Full Court, that there had been an agreement between the parents to not follow the relevant part of the 2013 orders at the relevant time. I consider that it cannot therefore be said that the 2013 orders ‘applied’ in relation to Child A at the relevant time.
The Tribunal may use findings of other tribunals or courts as evidence upon which it may base its own findings. In Re Proctor and Commissioner of Taxation [2005] AATA 389, it was found that the essential findings on which a court decision is based bind the Tribunal only if the Tribunal is required to consider the same issue as the court, and a reading of the conferring legislation states it intends to bind the Tribunal as such. I do not view this as a question of the Tribunal being automatically ‘bound’ by the findings of the Family Court on questions of fact, or that the Court’s findings are potentially capable of being misunderstood and misappropriated because they were reached in the course of quasi criminal contravention proceedings. Rather I consider that whether or not a care arrangement ‘applied’ in relation to Child A at the relevant time for the purposes of family assistance is a question of mixed law and fact for me to decide in this review.
The evidence mentioned by Berman J as justifying the conclusion that the parties had “effectively suspended the relevant aspects of the 2013 orders”, and that “it was the parties’ understanding that what was in operation and what effected and regulated the arrangements between the parties and the children and the time that the children would spend with the parties was not [the relevant orders] but rather the informal but nonetheless appropriate agreement that the parties had reached” led the court to conclude that contravention proceedings could not be sustained.[5] The same evidence leads me to conclude that the 2013 order that undoubtedly once did represent a care arrangement for family assistance purposes was not a care arrangement that applied in relation to Child A at the relevant time.
[5] T28, p 137.
Did another kind of ‘care arrangement’ apply?
A court order (that is, a parenting order within the meaning of section 4 of the Family Law Act 1975) is not the only form of ‘care arrangement’ relevant. A ‘care arrangement’ may also be a ‘written agreement between the parents of the child… that relates to the care of a child.’
The Tribunal at Tier 1 had noted that in relation to whether a written agreement existed MDXJ had set out amendments to the orders in writing, but also noted evidence that MDXJ had said that the parents were following a week by week verbal agreement about the care of the children. SVPX is recorded to have told the Tribunal (at Tier 1) that a verbal agreement was not possible given the level of conflict between the parties, and that actual care followed the written agreement. The Tribunal also inferred by implication that a written agreement existed based on the observation of Justice Berman that (in referring to an agreement) ‘there was apparently some formality to the agreement in that both the mother by her questions and the father by his answers agreed there is a document which sets this out’.
Given the greater focus I have applied on whether a care arrangement applied at the relevant time, it is necessary for me to be satisfied that a written agreement in fact exists, and so I have not assumed the existence of a written agreement on the basis of remarks made by the parties or others, but sought to identify a written agreement with precision. In this regard, I have regard to a bundle of transcript extracts produced by MDXJ of proceedings before Justice Berman on 3 February 2017. I note there is some discussion about an agreement setting out arrangements by which the court orders would not be followed. I have noted that in evidence both MDXJ and SVPX, in response to his Honour’s questions and request to produce a document setting out the agreement mentioned that such a document existed but were not in a position to produce it.
In this regard, I accept the submission of the Secretary (in written submissions of 14 August 2018) that while the term ‘written agreement’ is not defined in the legislation, Departmental policy suggests that a written agreement will exist if there is a document in writing, signed and dated by both parties, indicating both parties agree on care arrangements for a child as specified in the document. The Secretary contends that the words and context of the legislation support the interpretation expressed in the Guide, particularly when regard is had to the relative formality of other forms of ‘care arrangements’. While I agree generally with the submissions of the Secretary and the basis for requiring a degree of formality for a ‘written agreement’, I consider that an exchange of correspondence with similar characteristics rather than a single document would also constitute the written agreement envisaged by the legislation, and the presence of signatures would be ideal but is not necessarily essential. In this regard, I note and agree with the Secretary’s contentions as to purpose, noting that the definition of ‘care arrangement’ is exhaustive and is intended to provide clarity, certainty and formality to any agreement about the care of children. As provided for in the legislation, an agreement must in any event be in written form, to the exclusion of agreements reached by other forms. I do not consider that where ‘written’ agreement is required, agreement can be inferred from conduct or evidence of oral agreement.
There is no singular document signed by both parties setting out that both parties agree on care arrangements for Child A as specified in the document. It is apparent from my review of the documentary evidence relied upon by MDXJ that MDXJ had attempted to set out changes to care arrangements for Child A with a high degree of formality, but I also observe that an essential component of a written agreement is not only that it be in writing, but that it record an agreement.
MDXJ relies on a series of email and text message exchanges from which he submits a written agreement may be discovered.
MDXJ refers to proposing amendments to the orders in May of 2016. Corresponding text messages referred to by MDXJ in his submissions (messages marked as 3A, 3C and 4B) do not demonstrate written agreement to any proposals.
On 1 June 2016, MDXJ sent an email with an attachment proposing changes to the care provided for in the court orders. Text messages referred to by MDXJ (4C, 4D) disclose discussion of an agreement, but do not constitute a final written agreement of any particular terms.
On 16 June 2016, MDXJ sent an email containing a document entitled ‘interim order amendment’. The document purports to be accepted in the event that SVPX sent an email response back. SVPX however responded with a modified draft on 17 June 2016. This modification was not acceptable to MDXJ, who responded on 21 June 2016. SVPX responded on 26 July 2016 offering to revert to the original order but seeking confirmation from MDXJ to that effect. No further email correspondence was exchanged. I am not satisfied that the email exchanges constitute a written agreement.
It appears that what MDXJ had referred to as a ‘three month trial’ proceeded notwithstanding the absence of any clear written agreement as to its terms. I understand this to be the informal agreement referred to by Justice Berman.
My analysis of the documentary evidence and contentions of MDXJ fail to reveal the existence of a written agreement regulating the provision of care for Child A at the relevant time. I am not satisfied that a written agreement between the parents of Child A relating to his care existed at the relevant time.
Conclusion on preliminary issue
I have found that the court order of 4 December 2013, being ‘a care arrangement’, did not apply at the relevant time. I have also found that the informal arrangements between MDXJ and SVPX were not in the form of a written agreement, and cannot constitute a ‘care arrangement’ under the legislation. Therefore I conclude that a care arrangement did not apply in relation to Child A at the relevant time.
CONSEQUENCES ON THE APPLICATION FOR REVIEW
As I have found that a care arrangement did not apply in relation to Child A at the relevant time, section 35C of the Family Assistance Act and its scheme of dual care percentage determinations for a period cannot be invoked.
Furthermore, the discretion created within section 35L to effectively extend or reduce the interim period in special circumstances has no application.
Summonses requested to be issued by the Tribunal to assist MDXJ present evidence potentially relevant to the broad discretion in section 35L will not produce relevant evidence, and so the request to issue the summonses is refused.
The relationship between section 35C and section 23 of the Family Assistance Act
There remains the question raised by MDXJ at the conclusion of the hearing of the preliminary issue about the relationship between section 35C and section 23 of the Family Assistance Act.
As observed by Senior Member Britten-Jones (as he then was) in Arnold and Secretary, Department of Social Services [2016] AATA 1080, it appears odd that section 23 and section 35C of the Family Assistance Act requires a discretion to be exercised twice involving the consideration of the same or similar facts, but that appears to be the effect of the legislation. In this regard, the Senior Member refers to the discretion in subsection 35C(5) to determine a single percentage of care instead of two in special circumstances, but the same observation may equally be made in relation to the discretions in section 35L of the Family Assistance Act.
To elaborate, and as touched on above, section 23 of the Family Assistance Act addresses a similar problem as addressed by section 35C in setting out the effect of an FTB child ceasing to be in an individual’s care without their consent, and providing for that child to remain an FTB child of the individual for a period in accordance with its terms.
Section 23 is not prefaced with the same qualifying criterion as section 35C that a ‘care arrangement’ apply in relation to the child. The provision regulates when the child remains an FTB child of the adult, being a qualifying criterion for eligibility for FTB, and does not pertain to a care percentage determination.
Section 23 requires, among other things, that an event occurs in relation to the child without the adult’s consent that prevents the child being in the adult’s care, and the adult takes reasonable action to have the child again in the adult’s care. It provides that the child remains an FTB child of the adult for that part of the ‘qualifying period’ provided that the child would have been an FTB child under section 22(2) or (3) if the child had not ceased to be in the adult’s care, and the adult is legally responsible (whether alone or jointly with someone else).
The apparently duplicated discretion to the section mentioned in Arnold is at subsection 23(5A). It permits the Secretary, if satisfied that special circumstances exist, to specify a day earlier than the last day in a 14 week period to end the qualifying period.
The meaning of the term ‘qualifying period’ is provided for at subsection 23(5) of the Family Assistance Act, and in my view is critical in understanding the inter-relationship between section 35C and section 23 of the Family Assistance Act in the circumstances of this case.
It provides that the qualifying period is the period beginning when the child ceases to be in the adult’s care, and ends at the earliest of the following times:
(a)If the child comes again into the adult’s care, at that time;
(b)After 14 weeks passes;
(c)An earlier date than 14 weeks if the discretion in subsection 23(5A) is exercised to so specify; and
(d)If the adult is a parent of the child, and no family law order is in force in relation to the child, and the child comes into the care of the other parent, that later time.
In this case, the circumstances are that Child A ceased to be in MDXJ’s care and entered the other parent, SVPX’s care, at the same time. If I considered that no family law order was in force in relation to Child A at the relevant time, then subsection 23(5)(c) would apply and the qualifying period would start and end at the same instant.
I find that the circumstances I have considered which lead to my conclusion that the care arrangement in the form of the court order of 4 August 2013 did not ‘apply’ in relation to Child A at the relevant time, also leads me to the conclusion that no family law order was ‘in force’ in relation to Child A during the period beginning when Child A ceased to be in MDXJ’s care.
In this way, even though section 23 is drafted differently to section 35C, its terms have no practical effect to preserve Child A as an FTB child of MDXJ in circumstances where the care arrangement did not apply, the court order was not in force, and where at that point Child A entered the care of his other parent.
In my view, in the circumstances of this case, there is no tension between section 23 and section 35C of the Family Assistance Act. The application of the facts I have found to section 23 mean that Child A does not continue to be MDXJ’s FTB child, and there is no utility in exercising the discretion in section 23(5A) of the Family Assistance Act. The application of the facts I have found to section 35C means that it does not operate to require care determinations be made to create an interim care period, and the exercise of discretion to change the duration of the interim care period in section 35L does not arise.
I note that MDXJ contends that Arnold firmly establishes that there are at least two clear and distinct paths to FTB qualification when a care change occurs without consent. With respect, Arnold is not authority for that proposition. The decision in Arnold did not consider a situation where no care arrangement applied and no court order was in force. In any event, Arnold merely observed the apparent duplication of terms providing for the exercise of a discretion that was relevant to that case. It is clear from the legislative scheme that section 23 is directed towards the eligibility criteria for FTB, while section 35C of the Family Assistance Act works within a complex framework of care determination provisions to preserve the rate payable for periods in which eligibility is preserved. In the circumstances of this case, the provisions work in synchronicity with each other.
DIRECTIONS ON PRELIMINARY ISSUE
The request to issue summonses is refused.
The matter is to be listed for a further hearing at a date to be advised by the Registry for the parties to be heard on the issue of final orders and the decision in the reviews.
I certify that the preceding 85 (eighty-five) paragraphs are a true copy of the reasons for the decision herein of Member M Kennedy
.........................[Sgnd]......................................
Associate
Dated: 19 February 2019
Date of hearing: 4 September 2018 Date final submissions received: 27 September 2018 Applicant: By telephone Advocate for the Respondent: Oliver Morris Solicitors for the Respondent: Department of Human Services Other Party: By telephone
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