Nicholas Hart and Child Support Registrar
[2014] AATA 282
[2014] AATA 282
Division GENERAL ADMINISTRATIVE DIVISION File Number
2013/6079
Re
Nicholas Hart
APPLICANT
And
Child Support Registrar
RESPONDENT
DECISION
Tribunal Ms N Isenberg, Senior Member
Date 9 May 2014
Place Perth The Application is dismissed under s 42B of the Administrative Appeals Tribunal Act 1975.
................................[SGD]........................................
Ms N Isenberg, Senior Member
CATCHWORDS
FAMILY SUPPORT - Applicant not Permitted to Leave Australia under Departure Prohibition Order - Applicant Applied for Departure Authorisation Certificate - Application Refused - Period for Departure Authorisation Certificate Elapsed - Any Decision of the Tribunal Would be Futile - Application Dismissed under s 42B of the Administrative Appeals Tribunal Act 1975
LEGISLATION
Administrative Appeals Tribunal Act 1975
Child Support (Registration and Collection) Act 1988
CASES
Ripszam and Minister for Infrastructure and Regional Development [2013] AATA 918
Williams and Australian Electoral Commission and the Greens (Party Joined) [1995] AATA 160
REASONS FOR DECISION
Ms N Isenberg, Senior Member
9 May 2014
BACKGROUND
The applicant, Nicholas Hart and his former wife, Sally are the parents of three children (‘the children’), the youngest of whom is now 17 (Mr Hart has 3 other children). Mr Hart was assessed to pay child support in relation to the children, and since 2001, this child support has been registered for collection by the Child Support Agency (now Child Support Services within the Australian Government Department of Human Services) (‘Child Support’). He has accumulated a significant child support liability for both arrears and interest (‘the debt’).
Mr Hart has lived and worked overseas since 2003. He lived in Singapore until October 2008. Singapore is a country with whom Australia has a reciprocal child support agreement and while he lived there, he was assessed to pay ongoing child support, which was collectable by Child Support. In November 2008, Mr Hart moved to Brunei and commuted (‘fly-in/fly-out’) to Singapore. Because Australia does not have a reciprocal child support agreement with Brunei, once he became a resident of Brunei, he was no longer required to pay ongoing child support payments. However, he is still required to pay the debt.
Mr Hart came to Australia on 5 November 2013 to see his children and to show the country to his new wife. He may also have come for business. Essentially, because of the size of the debt (about $46,000), on 13 November 2013 he was issued with a Departure Prohibition Order (‘DPO’) by the Child Support Registrar (‘Registrar’) pursuant to s 72D of the Child Support (Registration and Collection) Act 1988 (‘the Act’). It is an offence to depart Australia when there is a DPO in place unless a Departure Authorisation Certificate (‘DAC’) has been issued by the Registrar.
Mr Hart said he received a phone call informing him about the DPO on 15 November 2013. Rather than seek revocation of the DPO (a course Mr Hart was apparently unaware) Mr Hart wrote to the Registrar on 19 November 2013 and requested that he be permitted to leave Australia on 27 November 2013 and return on 31 March 2014. His letter – “an application for a DPO travel restriction waiver (whatever it is termed)” - was treated as an application for a DAC. His application was refused by the Registrar on 21 November 2013.
The following day Mr Hart sought review by this Tribunal of the decision to refuse to issue a DAC. It is unfortunate that the urgency associated with the application was not highlighted at that stage or during the conferencing process. I note that Mr Hart made subsequent applications for a DAC, each based on a change of circumstances. These matters are not the subject of the present review. It may be that those circumstances overtook the basis on which the DAC had been sought, and in that regard, the urgency in respect of the present matter, from Mr Hart’s point of view, fell away. His circumstances have changed again.
He has subsequently applied to the Federal Circuit Court for a revocation of the DPO. Mr Hart also disputes the quantum of the debt but that matter is not for determination here either and is the subject of proceedings in the Family Court.
It was discussed at the hearing that the period in respect of the DAC has now passed.
Section 42B of the Administrative Appeals Tribunal Act 1975 (‘AAT Act’)_ provides:
(1)Where an application is made to the Tribunal for the review of a decision, the Tribunal may, at any stage of the proceeding, if it is satisfied that the application is frivolous or vexatious:
(a) dismiss the application; and
…
Section 42B has been interpreted in numerous decisions of the Tribunal eg, in Ripszam and Minister for Infrastructure and Regional Development [2013] AATA 918 at [18] Senior Member Creyke stated:
...The expression ‘frivolous or vexatious’ covers proceedings which have become futile due to a change in circumstances... The Tribunal accepts that the power to dismiss a proceeding under section 42B(1)(a) should be exercised cautiously and sparingly.
The applicant should not consider that the phrase connotes in his case some abuse of process or totally misconceived application or that there is any implied criticism of his decision to bring this application for review.
In Williams and Australian Electoral Commission and the Greens (Party Joined) [1995] AATA 160 the Tribunal observed at [40]:
In this case the outcome of the proceedings, whether successful to the applicant or otherwise will be devoid of any practical effect. ... Accordingly, in our opinion, whilst the proceedings were not instituted vexatiously, they have become vexatious.
Dismissal under s 42B is usually applied for by one of the parties. In this matter the Respondent did not press for dismissal, but only raised at the hearing in submissions for the first time, whether any orders the Tribunal could make would be of any effect. In my view, on the plain words of s 42B, no application for dismissal is required and the Tribunal may dismiss a matter on its own volition.
Nonetheless, in fairness to the parties, I am prepared to make some observations about Mr Hart’s circumstances but I do not propose to make findings in relation to the evidence: Reddish and Civil Aviation Authority [1999] AATA 721 at [24].
ISSUES
The issues considered are:
·Is it likely that Mr Hart would be likely to depart Australia and return within a period that the Tribunal considers appropriate? : s 72L(2)(a)(i) of the Act.
·Is it likely that, within a period that the Tribunal considers appropriate, the Registrar will be required by subsection 72I(1) to revoke the DPO (s 72L(2)(a)(ii) of the Act? This in turn requires consideration of:
oWhether it is likely that Mr Hart will no longer have a child support liability;
oWhether it is likely that Mr Hart will continue to have a child support liability but will have made an arrangement satisfactory to the Registrar for the discharge of that debt; and
oWhether Mr Hart continues to have a child support liability, but the Registrar considers it to be completely irrecoverable;
·Whether it is unnecessary for Mr Hart to give security pursuant to s 72M of the Act: s 72L(2)(b) of the Act
·If the Tribunal is not satisfied of all of the above, whether one of the following may apply (s 72L(3) of the Act):
oWhether Mr Hart has provided security pursuant to section 72M;
oWhether Mr Hart is able to provide such security;
oIf Mr Hart is unable to provide such security, whether the DAC should be issued on humanitarian grounds; or
oIf Mr Hart is unable to provide such security, whether refusing the DAC will be detrimental to Australia's interests.
IS MR HART LIKELY TO DEPART AND RETURN TO AUSTRALIA WITHIN AN APPROPRIATE TIME?
The respondent’s contention was, essentially, that Mr Hart did not have sufficient ties to Australia such that it was likely that he would return to Australia in the event a DAC was granted.
Mr Hart gave evidence that he had worked all over the world during his career. He ‘ended up’ in Sydney. He moved to Singapore for work in 2003, after his 2001 marriage breakdown. He described himself as an entrepreneur. He worked in various ‘high tech’ companies including satellite and communications installations, and oil and gas enterprises. He was paid largely on a bonus arrangement.
By 2006-7 the cost of living in Singapore had dramatically increased and he decided to move to Brunei and commute to Singapore, where he stayed with friends during the week. In 2008 the company for whom he worked suffered badly in the GFC, and his salary halved. The company was in crisis and he was caught in the fallout. He negotiated with the Chairman that he work out of Brunei. He denied that he moved to Brunei to avoid the debt.
By 2010 the Brunei business was going well but became ‘too successful’ and its progress was stymied. Ultimately he was asked to resign.
In November 2011 he started working with AMARTR. At first he was paid a very low salary – about $5000 per month. AMARTR undertook satellite-related services which include installation for Australian companies which was to occur in November 2013 and he was part of that process. The satellite launch was delayed and the schedule kept changing. His fulltime employment with AMARTR ended in February 2014. There was instead a 4 month contract on commission only. AMARTR’s Brunei business is being sold and in February 2014 the applicant was asked to go to Malaysia as part of the sale negotiations.
The Applicant noted that at the time he became a non-resident in Australia, he had a good payment history between 2001 to May 2008. I do not understand the Respondent to dispute this contention. Mr Hart wrote to the Respondent in November 2013 and in February 2014 stating that he had work commitments in Australia and he referred to the letter the employer wrote to the Respondent dated 5 January 2014. Mr Hart had continuing commitments to AMARTR associated with project work associated with the sale of the business and ongoing work at the Teleports.
He contended that a broader view should be taken of the relevant considerations, one of which is that the debt is more likely to be repaid if he is allowed to work overseas, where his prospects of high paying employment are much better. His evidence was that he would travel wherever his work took him. He submitted that the Tribunal should consider the "big" picture over last 13 years and his track record in its entirety. However, that ‘track record’ is not a good one. He has a debt, some of which goes back a number of years, well before the GFC, on which he largely blamed the demise of companies for which he worked and the consequent reduction in his salary.
It may be that the debt would be more likely to be repaid if he is allowed to work overseas, where his prospects of high paying employment may be much better. On the other hand, it may not, especially if he is in a country which does not have reciprocal arrangements. His evidence was of the companies for whom he had worked were involved in enterprises worth millions of dollars. There is sometimes interference at high levels - they are high risk businesses. Mr Hart, a self-proclaimed ‘entrepreneur’ is similarly, it seemed to me from his evidence, a risk taker.
Mr Hart said he had not returned to Australia in the last 5 years because he had not had either the time or the money. Mr Hart said he no longer lives in Brunei, although his father resides most of the year there. Mr Hart does not own a home in Australia, or anywhere. He is presently living with his son in country NSW.
Mr Hart’s current wife lives in Singapore but has applied for a spouse visa to come to Australia. He agreed that it was inconsistent that his now wife is seeking to migrate to Australia at the same time he is seeking to depart Australia and has said he wishes to work overseas because the job prospects are so much better.
In cross-examination he was asked about the overseas jobs he is applying for and what would occur if he were offered an immediate start. He said the companies are international satellite companies and he would be in and out of Australia.
I could not be confident that Mr Hart would likely to return to Australia within an appropriate time.
IS IT LIKELY THAT, WITHIN A REASONABLE PERIOD, THE REGISTRAR WILL BE REQUIRED TO REVOKE THE DPO?
Subsection 72I(1) provides that the Registrar is required to revoke a DPO in the following circumstances:
(a)the person no longer has a child support liability; or
(b)the person has a child support liability, but arrangements satisfactory to the Registrar have been made for the liability to be wholly discharged; or
(c)The person has a child support liability, but the Registrar is satisfied that the liability is completely irrecoverable.
There was no dispute that the applicant continues to have a debt, albeit the applicant claimed it would shortly be much reduced by the Family Court to which he has applied to review past child support assessments. The applicant expects the size of the arrears to be reduced dramatically following the review, and is confident his debt will be reduced to about $10,000. The respondent submitted, and I agree, that even if the application is as successful as the applicant hopes, the respondent will still have a significant child support liability.
As to satisfactory arrangements for payment of the debt, the applicant had previously proposed to discharge his child support liability by paying an initial lump sum of $1000 followed by installments of $600 per month. The Registrar did not consider this payment arrangement appropriate to warrant the revocation of the DPO, because it would take over 6 years to discharge the debt.
As to how he would propose to discharge even the debt, in the event his application to the Family Court for reduction was successful, the applicant said he would pay $600 per month, if he were to get bonuses.
The applicant had made only one payment of $587 in the last 4 years. He referred to his good payment history up until the time he got into financial difficulties. His evidence was that his salary, which was largely bonus-based, reduced dramatically in late 2008 and all his allowances were stopped due to company cash flow problems arising from GFC in mid-2008. This is why he moved his family to Brunei as the cost of living, school fees and all other costs were far cheaper than in Singapore. As it transpired, the move to Brunei was a very expensive process in itself.
Mr Hart was declared bankrupt in Singapore in September 2011 and reached a settlement with the Singapore government in September 2012 after he was stopped by the Immigration from leaving Singapore. He was making payments for his bankruptcy of S$1,500 per month until he recently lost his employment. He claimed it was the action of Respondent which caused him to lose his contract employment in Brunei, and hence with no income, was unable to address his Singapore bankruptcy payments nor the debt, nor any other of his financial responsibilities.
Mr Hart said AMRTUR had even offered to lend him up to A$20,000 for the purpose of securing DAC “through a trust payment” but this was not acceptable to Respondent who insisted that a payment be made towards the debt.
Mr Hart said the debt largely arose from an 18 month period (in 2008/2009) when child support assessments increased by 40% when at the same time his income reduced enormously and he had additional expenses associated with his family move to Brunei. Mr Hart said he has not paid child support for the simple reason that he has not had the funds and was struggling to survive from 2010 to 2012, being either unemployed or receiving only a low income.
Mr Hart submitted that the only mechanism for securing a solution to all his debts, is to earn an income and he has a track record of doing this when overseas for a number of years. If the Respondent stops him from working overseas at the age of 54, he is not going to find it at all easy to fit back into Australian workplace. Mr Hart was not optimistic about his prospects of finding work in Australia because of the slowdown in the resource sector, chaos with NBN Telecommunications strategy, and reduction of the Australian manufacturing and related R&D sectors.
From Mr Hart’s evidence it appears that he has experienced and continues to experience financial difficulties. His evidence was that those difficulties arose largely as a result of the GFC in 2008. However his arrears have been accumulating since 2003, and for 5 years until the GFC he was earning, on his evidence, up to $500,000 per year, once bonuses were taken into account.
Mr Hart is an undischarged bankrupt in Singapore. However, this does not either discharge his obligation to pay his child support arrears or mean that the debt is completely irrecoverable. On Mr Hart's own previous proposals he could continue to make small payments towards the child support liability; in his evidence he identified some job prospects in Australia, as well as some overseas potential jobs.
SHOULD MR HART GIVE SECURITY PURSUANT TO S 72M FOR HIS RETURN TO AUSTRALIA?
The Respondent submitted that Mr Hart should be required to give security, pursuant to section 72M of the Act for his return to Australia. Relevantly, it is noted that the applicant:
·does not reside in Australia;
·does not have property or significant assets in Australia;
·does not have employment or strong business ties to any company in Australia;
·has not travelled to Australia frequently in recent years;
·currently has no income; and
·any overseas travel now would be for the purposes of a job interview and would be paid for by the prospective employer.
He previously offered security from an employer. This apparently is no longer available because he is unemployed.
While Mr Hart said he and his present wife are strong Christians and do not believe in walking away from their responsibilities, he has, in times when his bonuses were very high, not honored the financial commitment he has to his children represented by the debt.
Has Mr Hart given Security?
Mr Hart did not offer any security for the purposes of the reviewable decision.
For the purposes of a subsequent DAC application dated 2 December 2013 Mr Hart offered security of $20,000 which he proposed his then employer would provide an initial payment of $1,000 and thereafter $600 per month. The Registrar was not prepared, to accept security of $20,000 as being sufficient and proposed that $10,000 be provided as security and $10,000 be paid as a lump sum towards the debt. The employer refused. The Applicant regarded that the insistence that loan payment be directed towards reducing the child support in arrears as a punitive action.
It was discussed at the hearing whether he had explored having the employer advance him the $10,000 which he could attribute towards the debt. He said that AMARTR had its own financial problems. He was told the company would have to downsize in January. He said AMARTR could have done it in January but not in February. It seemed to me that if AMARTR had financial problems then it was unlikely that the situation could have changed as rapidly as he suggested. By February he had been terminated. It is unlikely if AMARTR had such severe financial difficulties that it could have risked tying up $20,000 for 3 months. It also seemed to me that Mr Hart missed the point of the discussion; he did not seek an advance of his salary.
In the application for a DAC dated 18 February 2014, after his employment in Brunei had been terminated, Mr Hart offered security of $10,000, which was later amended to an offer to pay $2,500 in child support arrears and security of $7,500. The Respondent did not consider this offer to be sufficient security in the circumstances. He was seeking to be able to attend overseas meetings with his ex-employer and a potential new employer.
Is Mr Hart able to Give Security?
As noted above, Mr Hart did not offer security for the DAC application the subject of this application for review, but did subsequently offer security of $20,000. In February 2014, he offered security of $7,500, but this was not considered to be sufficient security for the purposes of section 72M of the Act.
Mr Hart provided information in relation to his financial circumstances, which suggest that his expenses have been high in recent years, that he does not have significant assets, and that he is an undischarged bankrupt in Singapore.
In cross-examination Mr Hart agreed he was unable to provide security.
ARE THERE HUMANITARIAN GROUNDS TO ISSUE TO DAC?
Mr Hart's stated reason for wishing to return overseas is for the purpose of employment. I agree with the respondent’s submission that this is not a humanitarian reason.
WILL REFUSING THE DAC BE DETRIMENTAL TO AUSTRALIA’S INTERESTS?
The respondent submitted that as Mr Hart’s stated reason for wanting a DAC was his employment, it would not be detrimental to Australia’s interests for the DAC to be refused. The applicant contended that by not giving the Singapore High Court bankruptcy issue appropriate weight, and by subordinating that obligation to his child support obligations in Australia, this had negatively impacted upon Australia’s relations with Singapore. In my view this consideration refers to far more significant international relations than the effect of the applicant’s child support debt on his Singaporean bankruptcy.
Also, the applicant contended, by changing the security payment arrangements which had been offered, the applicant’s former employer - a company with business interests in Australia – its views on Australia have been marred. There was no evidence to that effect. In any event I doubt that the views of those involved in a company in Brunei would impact on Australia’s interests. Further, it was not altogether clear in any event that the withdrawal of the loan offer was not precipitated by the company’s own financial problems and Mr Hart’s failure to seek to negotiate an advance of his salary rather than the deposit of a security.
In summary, the applicant submitted that the respondent had not taken a broad view of the matter and had not considered all the foreseeable consequences of the decision, nor the wider view of the matter in relation to the children impacted by the decision. In particular he noted his child support payment history, from 2001 to April 2008, and child support payments which he has made privately for one child from February 2013 to date. He noted his close association with his children, although as was discussed at the hearing, the Tribunal was not concerned with the depth of his relationship with his children. The respondent did not dispute that he was a caring father and noted that this is not a relevant consideration in the issue of a DAC. Mr Hart referred to his long history of regular travel in and out of Australia for work projects.
Mr Hart said his former employer still requires his support associated with the sale of the company and operations of the business and Mr Hart would still be required to travel in and out of Australia to support these projects. Mr Hart is also seeking other project opportunities and employment within the region.
There were some aspects of Mr Hart’s evidence that were troubling. He has made private arrangements for the support of his youngest child. It was unclear how this was financed. He said his son was at boarding school and that the fees were paid by ‘a benefactor’. His daughter has a horse said to be valued at $100,000. It is unclear how such arrangements have been made. These issues are likely to be canvassed elsewhere.
DECISION
The Application is dismissed under s 42B of the Administrative Appeals Tribunal Act 1975.
I certify that the preceding 54 (fifty four) paragraphs are a true copy of the reasons for the decision herein of Ms N Isenberg, Senior Member ............................[SGD T Freeman]............................................
Associate
Dated 9 May 2014
Date(s) of hearing 11 April 2014 Applicant In person Representative for the Respondent Ms A Ladhams Solicitors for the Respondent Australian Government Solicitor
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