Mikhailov and Donaher (Child support)

[2020] AATA 4398

Mikhailov and Donaher (Child support) [2020] AATA 4398 (4 August 2020)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2020/PC019280

APPLICANT:  Mr Mikhailov

OTHER PARTIES:  Child Support Registrar

Mrs Donaher

TRIBUNAL:Senior Member R Ellis

DECISION DATE:  4 August 2020

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that the application for the child support liability to be enforceable is refused.  As a consequence the application for collection of arrears must also be refused.

CATCHWORDS

CHILD SUPPORT – registration details – application for collection of the maintenance liability – whether the application for collection and arrears should be accepted – whether conditions to refuse were met – the application for collection and arrears should be refused – 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

1. Mr Mikhailov and Mrs Donaher are the parents of [the child] (born February 2005).  There has been a child support assessment in place since 20 August 2008 and Mr Mikhailov is the liable parent under the assessment.  The parents have another child who is no longer a child of the assessment.  This matter relates to [the child] only.

2. On 21 October 2019 Mrs Donaher applied to the Child Support Agency to commence collecting child support as well as outstanding payments for the period from 21 July 2019 to 20 October 2019.

3. On 31 January 2020 the Child Support Agency accepted Mrs Donaher’s application for collection effective from 21 October 2019.  A decision was made that Mr Mikhailov owed $108.51 in unpaid child support for the period from 21 July 2019 to 20 October 2019.

4. On 11 February 2020 Mr Mikhailov objected to this decision and on 29 May 2020 the Child Support Agency disallowed the objection (the objection decision).

5. On 17 June 2020 Mr Mikhailov applied to the Administrative Appeals Tribunal (the Tribunal) for a review of the objection decision.

6. The Tribunal conducted a hearing into the application on 4 August 2020.  Mr Mikhailov gave evidence on affirmation by conference telephone.  In correspondence dated 24 July 2020 Mrs Donaher advised the Tribunal she did not wish to make any written or oral submissions.  Mrs Donaher did not participate in the hearing and was instead heard ‘on the papers’.  The Child Support Agency provided the Tribunal and the parties with papers relevant to the matter (83 pages).

ISSUES

1. The statutory provisions relevant to this review are contained in the Child Support (Registration and Collection) Act 1988 (the Act).

2. The issues which arise in this case are:

   ·      should the application to recommence collection of child support made by Mrs Donaher on 21 October 2019 be accepted; and if so,

   ·      what is the amount of child support arrears, if any, Mr Mikhailov is liable to pay?

CONSIDERATION

1. A payee can elect to end the collection of a child support liability under section 38A of the Act.  The Child Support Agency must accept an election to end collection and the liability will cease to be enforceable from a specified terminating day.

2. Section 39 of the Act states a payee who made an election under section 38A can reapply at a later time to again have the liability enforced by the Child Support Agency.  If the application is made in a specified manner then it must be granted subject to the satisfaction of the Registrar.  Subsection 39(5) states:

   The Registrar must grant the application unless the Registrar is satisfied that:

   (a)the payer of the liability has been complying with his or her child support obligations in relation to the payee; or

   (b)the payer of the liability has satisfactorily explained and rectified a failure to comply with his or her child support obligations in relation to a payee; or

   (c)there are special circumstances that exist in relation to the liability that make it appropriate to refuse the application.

3. If an application made under section 39 of the Act is accepted, the payee may also apply for any unpaid amounts to be treated as arrears amounts and collected by the Child Support Agency (subsection 39A(4)).  If the specified period does not exceed three months, the Child Support Agency must grant the payee’s application (subsection 39A(5)).

4. The Tribunal notes that, according to evidence provided by the Child Support Agency, Mrs Donaher has changed the mode of collection on several occasions.  The Tribunal is satisfied that Mrs Donaher applied in the specified manner for the liability to become enforceable again on 21 October 2019 and this was a subsequent application.

5. Mr Mikhailov told the Tribunal he had not been paying child support to Mrs Donaher because she owed him outstanding child support arising from an earlier period when [the child] was in his care.  Mr Mikhailov said he had a written agreement with Mrs Donaher that he was not required to pay child support until this debt had been cleared.  Mr Mikhailov added that he had also previously overpaid child support to Mrs Donaher and was in credit by approximately $2,700.

6. Mr Mikhailov explained the child support debt owed by Mrs Donaher was approximately $393.  He said as a result he was not in arrears.  Mr Mikhailov said he had provided the Child Support Agency with a copy of the written agreement he had in place with Mrs Donaher.

7. The Tribunal notes in evidence from the Child Support Agency a letter dated 8 February 2019 signed by Mrs Donaher.  It states:

   In reference to the outstanding debt of $393.36 on my account…payable by myself to Mr Mikhailov, I wish to confirm that Mr Mikhailov & I have agreed that he is not required to pay me the current monthly payment of $35.58 until the above debt has been cleared.

8. Mr Mikhailov told the Tribunal he had spoken to the Child Support Agency before setting up the agreement with Mrs Donaher.  He said he should not be required to pay child support until this debt was gone.  Mr Mikhailov did not dispute the arrears amount but said the agreement with Mrs Donaher negated this amount.  Mr Mikhailov said he was concerned the Child Support Agency had taken the view the $393 he was owed no longer existed.

9. The Tribunal notes that, according to Child Support Agency records, Mrs Donaher was the paying parent for a period and her child support liability was $393.36.  This liability was discharged by the Child Support Agency on 7 March 2019 at the request of Mr Mikhailov.  It appears the overpayment of $2,701.44 referred to by Mr Mikhailov arose following a previous decision made by the Tribunal, separately constituted, on 24 October 2018.  As a result of this decision child support was no longer collected by the Child Support Agency and Mr Mikhailov was instead required to make private payments directly to Mrs Donaher from 23 April 2018.

10. The intention of the arrangement between the parents, as set out in the letter dated 8 February 2019, is clear.  Mr Mikhailov has explained to the Tribunal that he was not paying child support because he considered this arrangement to be binding.  Mr Mikhailov, not unreasonably, believed he was not required to pay child support direct to Mrs Donaher at least until the child support amount of $393.36 owed to him by her had been extinguished.

11. Although it is unclear when Mr Mikhailov again became the liable parent it is very unlikely, given the date of their arrangement, that the debt of $393.36 had been cleared by the time Mrs Donaher made her application to recommence collection on 21 October 2019.  This is because the monthly rate of child support during the private collect period, according to the parents, was $35.58 and this would take approximately 11 months to clear from 8 February 2019.

12. The Tribunal is satisfied, based on the evidence provided, that when Mrs Donaher made her application for collection Mr Mikhailov was complying with his child support obligations and satisfies the condition in paragraph 39(5)(a) of the Act.  This means the application made by Mrs Donaher for the liability to again become enforceable must be refused.

13. The Tribunal also finds that, as the application for collection must be refused, the application for arrears to be collected from 21 July 2019 to 20 October 2019 must also be refused.

14. In making this decision the Tribunal accepts that Mrs Donaher might consider making a further application to recommence collection of child support once the amount of $393.36 has been cleared in accordance with the agreement between the parents.  In doing so she would also need to consider an appropriate period for the collection of any outstanding arrears.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that the application for the child support liability to be enforceable is refused.  As a consequence the application for collection of arrears must also be refused.