Naylor and Child Support Registrar (Child support)

[2023] AATA 4301

Naylor and Child Support Registrar (Child support) [2023] AATA 4301 (2 November 2023)

DIVISION:Social Services & Child Support Division

EXTENSION APPLICATION

NUMBER:2023/SC026674

APPLICANT:  Ms Naylor

OTHER PARTY:  Child Support Registrar

DATE DECISION MADE:                02 November 2023

APPLICATION:

An extension application made on 28 August 2023 asking the AAT to consider the application for AAT first review of a decision of the Child Support Registrar on 12 April 2021 despite the period for applying for review having ended.

DECISION:

The extension application is refused.

CATCHWORDS

CHILD SUPPORT – application for extension of time - no satisfactory explanation for the lengthy delay – some merit – not fair and equitable - extension of time refused

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.

STATEMENT OF REASONS

1. Ms Naylor and [Mr A] are the parents of [Child 1]. [Child 1] is recorded as being in Ms Naylor’s 100% care. A registered child support assessment has been in place from 15 September 2020 and registered for Services Australia (Child Support) collection from that date. [Mr A] is the parent liable to pay child support.

2. [Mr A] applied for non-agency payments to be credited towards his child support liability. On 6 November 2020 Child Support made the decision to accept some of the payments made by [Mr A] totalling $3,034.46 as non-agency payments to be offset against his child support liability.

3. On 28 November 2020 Ms Naylor lodged an objection to this decision. On 12 April 2021 an objections officer partially allowed Ms Naylor’s objection by reducing the total amount accepted as non-agency payments to $2,459.91.

4. On 28 August 2023 Ms Naylor lodged an application for review with the Administrative Appeals Tribunal (the Tribunal) for an independent review of this decision. As this request for review was not lodged with the Tribunal within 28 days of the objections officer’s decision, an extension of time request was also lodged. The matter was heard on the papers. The Tribunal had regard to the statement and documents (pages 1–276) supplied by Child Support under subsection 93(2) of the Child Support (Registration and Collection) Act 1988 (the Act) and the reasons for review outlined in the letter provided by Ms Naylor’s representative [Representative A], in her extension of time application.

5. The issue to be considered is whether Ms Naylor should be granted an extension of time to lodge an application for review of the Registrar’s decision.

LAW AND CONSIDERATION

1. The law relating to a person’s right to seek review of a decision of the Registrar is contained in section 29 of the Administrative Appeals Tribunal Act 1975 (the AAT Act). Subsection 29(2) of the AAT Act requires that a person must lodge a review request with this Tribunal within 28 days after a notice of the decision of the Registrar is given to them.

2. Where the period for lodgement has ended, the person may send the application to the Tribunal along with a request that the review be treated as if it was duly lodged, that is, that it was lodged within the allowed time (section 91 of the Act). This is commonly referred to as an extension of time request. Section 92 of the Act then provides that the Tribunal must consider the application for an extension of time, and grant or refuse that application in writing.

3. In Brisbane South Regional Health Authority v Taylor [1996] HCA 25, the High Court, in dealing with an extension of time case and the general concept of time limitation periods, noted that while an extension of time is the exception to the general rule, there are legislative provisions which, in the circumstances of an individual case, may indicate that justice is served by the general rule being overruled.

4. In making this decision, I considered the guiding principles for the exercise of a discretion to allow an extension of time as set out in Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 (Hunter Valley Developments). In that case the Federal Court said that an extension of time should not be granted unless it was proper to do so, noting 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.

5. In Brown v Commissioner of Taxation [1999] FCA 563, Hill J reviewed the principles set out in Hunter Valley Developments in the context of a person seeking an extension of time to lodge an objection against an assessment of income tax. In that case, Hill J commented that Wilcox J in Hunter Valley Developments never suggested he was laying down a series of principles to be applied in every case, and that the factors would serve as a guide and were not exhaustive. Further, he commented: “Too slavish an adherence to them should, in my view, be avoided.” Hill J then sought to reshape the factors to be considered in the context of objecting to a tax assessment.

6. The Administrative Appeals Tribunal, differently constituted, applied the principles set out in Hunter Valley Developments in Mulheron and Australian Telecommunications Corporation (1991) 14 AAR 42 (Mulheron). The authorities, Hunter Valley Developments and Mulheron, establish that when considering whether to exercise the discretion to allow an extension of time, a decision-maker should consider and balance a range of factors including:

   ·the reasons for the delay and whether the applicant rested on their rights;

   ·the merits of the substantive application;

   ·any prejudice to the other party including any difficulties that they will experience in providing evidence as a result of the delay;

   ·wider prejudice to the general public;

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

   ·whether it is proper to grant the extension of time.

7. Ms Naylor is deemed to have been notified of the objections officer’s decision electronically on 12 April 2021. Ms Naylor was 840 days late in her application to the Tribunal. [Representative A] writes in relation to Ms Naylor’s extension of time application the following reasons for the application to extend time for Ms Naylor’s review:

   I am applying on her behalf for review of an objection decision made by Services Australia:

   Child Support. The decision was made on 21 April 2021 to partly allow my client’s objection to decisions made on 23 October 2020 to accept that various payments are prescribed non-Agency payments under section 71C of the Child Support (Registration and Collection) Act 1988. My client’s grounds for review are that the decisions are wrong because the payments should not have been credited in the particular circumstances of the case under section 71D of that Act.

   My client’s application for review is significantly out of time and she seeks an extension of time to make her application. My client’s reason for delay is that she did not know she had a ground for objection until consulting this legal practice. Neither the original decision maker nor the objection officer considered whether section 71D applied and she could not know there was a discretion of this kind available to them that could properly be exercised in the circumstances of the case.

8. Section 71D of the Act provides that the Registrar may refuse to credit an amount under section 71, 71A or 71C if satisfied in the circumstances of the particular case, the amount ought not be credited.

9. The cover letter sent to Ms Naylor accompanying the objections officer’s decision states: “If you think this decision is wrong, you can ask the Administrative Appeals Tribunal (the Tribunal) to review it. You must do this within 28 days from the date you receive this letter.” The Tribunal is satisfied that Ms Naylor was advised of her right to seek a review of the objections officer’s decision.

10. [Representative A] explains the reason for the delay in Ms Naylor’s application to the Tribunal is because she was not aware of the Registrar’s ability to exercise the discretion contained in section 71D of the Act. If Ms Naylor disagreed with the decision of the objections officer, it was open to her to lodge an objection within time. Lack of knowledge of the law or of a possible remedy that may be available to Ms Naylor, that she becomes aware of at a later date, is not in the Tribunal’s view an acceptable reason for the significant delay in Ms Naylor’s application for review of the objections officer’s decision. The Tribunal notes that the objections officer in their Reasons for the decision does state the following:

11. The Tribunal notes that Ms Naylor did not contact Child Support in relation to the acceptance of the prescribed non-agency payments made by [Mr A] again until 3 February 2022 and again on 7 February 2022 when Ms Naylor was assisted by her lawyer, the Tribunal assumes this is [Representative A].[1] During this call [Representative A]’ explains that [Mr A] had ceased making home loan payments towards the mortgage forcing the sale of the home on 31 January 2022. During this call the officer notes that evidence shows that [Mr A] continued to make payments to the mortgage until December 2021 and payments towards council rates in April 2021.

    [1] Pages 161–162 of the subsection 93(2) documents.

12. On 20 April 2023 [Representative A] made the following written submission to Child Support requesting that future prescribed non-agency payments should not be credited to [Mr A’s] child support liability in circumstances when he has not incurred that liability because he has stopped paying the mortgage. [Representative A] further submits that Ms Naylor did not have a legal obligation to make payments towards the mortgage and [Mr A] did not make payments towards her “share of repayments that financed the payee’s home”. These were the reasons that [Representative A] submitted to Child Support which the Tribunal viewed were accepted as Ms Naylor’s reasons for the application for review to the AAT.

13. The Tribunal considered whether there is merit in Ms Naylor’s application for review. Section 71A of the Act provides for a payment made by the payer ([Mr A]) of an enforceable maintenance liability or a carer liability (child support) to a third party to be credited against the amount payable under the liability. The amount paid, or a part of the amount paid, must be intended by both the payer and the payee to be paid in complete or partial satisfaction of an amount payable under the liability in relation to the child support enforcement (paragraph 71A(1)(a) of the Act). The amount paid, or part of the amount paid, must be intended by both parties to be payments in lieu of child support (paragraph 71A(1)(c) of the Act).

14. Payments which are prescribed non-agency payments prescribed by regulation (section 19 of the Child Support (Registration and Collection) Regulations 2018) can be credited for a payment period, up to a maximum of 30% of the amount payable under an enforceable maintenance liability (section 71C of the Act). These include home loan repayments, utilities and home insurance.

15. The objections officer accepted that the payments made by [Mr A] are prescribed non-agency payments in accordance with the Regulations which can be accepted without mutual intent in accordance with section 71C of the Act. Subsection 71C(1) provides if the payer satisfies the conditions and the prescribed non-agency payment is accepted, the Registrar can credit up to 30% of the current liability from the date of notification of the payment. If the amount of the payment is more than 30% of the enforceable maintenance liability in a given month, the excess amount will be retained as an ‘uncredited’ amount. This uncredited amount can be applied against the payer’s enforceable maintenance liability in a later month provided the conditions for payment are again met, and can be carried over to a different child support enforcement period as long as it relates to the same liability.

16. Section 71D does apply to prescribed non-agency payments made in accordance with section 71C of the Act. The Child Support Guide 5.3.1 provides department policy on when it may be appropriate to exercise the discretion in 71D if certain conditions are met which include but are not limited to the following:

    ·The payee’s agreement to credit an amount paid to a third party or payment made as a transfer of property was obtained through coercion or harassment. (However, where the Registrar is informed about this after the payment has been credited, it will be necessary for the payee to object to the Registrar’s decision to credit the amount.)

    ·The payer is claiming a credit under CSRC Act section 71C for an expense they regularly meet that was taken into account in a change of assessment decision. For example, the Registrar or a court has reduced the annual rate (or refused to increase it) because the payer usually pays school fees, medical expenses for the child, mortgage or rent payments or any other prescribed payments.

    ·The payer is claiming credit under CSRC Act section 71C for an expense which they have undertaken to pay in addition to their liability as specified in an agreement between the parents (this does not have to be a child support agreement).

    ·The payer is claiming credit under CSRC Act section 71C for an expense that they are responsible to pay under the terms of a court order.

    ·The payer is claiming credit under CSRC Act section 71C for expenses for the child for which they are separately responsible. For example, the payer claims credit for child care costs for the days when the child resides with the payer. If the payer claims credit for a payment for which they and the payee are jointly responsible, and the amount does not relate to the payee’s home, the Registrar has no basis of apportioning the payment and must credit the full amount. However, if there is evidence that the parents have explicitly agreed about how much each party will pay, the Registrar will apportion responsibility according to their agreement.

    ·The payer is claiming a credit under CSRC Act section 71C for loan repayments and they have a history of regularly withdrawing funds from the loan account using its redraw facility.

17. The Tribunal is satisfied that there may be merit in Ms Naylor’s application for review. However, the Tribunal is of the view that Ms Naylor has rested on her rights. In accepting Ms Naylor’s application may have merit does not ameliorate the significant delay in Ms Naylor’s request for review. 

18. The Tribunal also considered that English is not Ms Naylor’s first language and accepts she may have had some difficulty in understanding the decision and her appeal rights. However, Ms Naylor decided to appeal when she became aware that [Mr A] had stopped payments for the mortgage following information received in early 2022 and following legal advice. The Tribunal does not consider Ms Naylor’s language difficulties as the main reason for the delay in her application to the Tribunal but rather an awareness of changing circumstances and an understanding of further grounds on which she could lodge an application for review. In relation to future credits of child support following the sale of the home, Ms Naylor will need to follow this up with Child Support.

19. The Tribunal also considered that extending the period in the present circumstances would prejudice community expectations in relation to the finality and certainty of administrative decision-making as well as cause prejudice to [Mr A] as a result of the significant delay in Ms Naylor’s application for review.

20. Ms Naylor has requested a review out of time. The Tribunal is of the view that Ms Naylor has not provided an adequate explanation for the delay. The Tribunal is also of the view that there while there may be some merit in reviewing the decision, it is not fair and equitable to do so given the circumstances of the case and the significant delay in applying to the Tribunal. It is therefore not proper to grant an extension of time and Ms Naylor’s extension of time application to the Tribunal is refused.

Senior Member S De Bono