PEAKE & COUSINS

[2016] FCCA 2856

FEDERAL CIRCUIT COURT OF AUSTRALIA

PEAKE & COUSINS [2016] FCCA 2856

Catchwords:
FAMILY LAW – CHILD SUPPORT – Mother’s Application for a departure order pursuant to section 117(2) of the Child Support (Assessment) Act 1989 (Cth). HELD – grounds not satisfied - application dismissed.

FAMILY LAW – ENFORCEMENT – Mother’s Application seeking to enforce alleged outstanding payments owed to her by the Father pursuant to Order 8 of the Orders made by consent on 26 June 2014. Held – Father is not liable for half of the enrolment fees for the parties’ six year old son as the child was enrolled without his consent – Father is required to payment for half of the cost of the child’s school psychologist – Father also to make payment of half the child’s gap medical and dental costs upon being provided receipts with details of any rebates previously received.

FAMILY LAW – COSTS – Where the Father makes an application for costs of and incidental to these proceedings – directions made for the filing of written submissions and a supporting affidavit.

Legislation:

Child Support (Assessment) Act 1989, ss.98E, 116(b), 117, 118

Federal Circuit Court Rules 2001, r.21.01

Cases cited:

Hides & Hatton (1997) FLC 92-759

Applicant: MS PEAKE

Respondent: MR COUSINS

File Number: MLC 4941 of 2014

Judgment of: Judge Bender

Hearing date: 1 September 2016

Date of Last Submission: 1 September 2016

Delivered at: Melbourne

Delivered on: 9 November 2016

REPRESENTATION

Counsel for the Applicant: Self-Represented

Solicitors for the Applicant: Not Applicable

Counsel for the Respondent: Self-Represented

Solicitors for the Respondent: Not Applicable

ORDERS

1. All previous Child Support Departure Orders be discharged.

2. Pursuant to section 118(1) of the Child Support (Assessment) Act 1989 (Cth) the Father pay the following by way of financial support of the children X born (omitted) 2008 (“X”) and Y born (omitted) 2010 (“Y”) and such sum not be credited against any Child Support Assessment issued in relation to X and Y:

   (a)one half of any medical and dental gap expenses for X and Y’s treatment and procedures that the parties have agreed to prior to such treatment or procedures taking place.

3. The Mother’s Application for a Child Support Departure Order be otherwise dismissed.

4. For and by way of enforcement of Order (8) of the Orders made

   
   

   24 June 2014, upon the Mother providing the Father with receipts for the total payment of the expenses contained herein together with details of all private health rebates paid to her in respect to such payments, the Father pay to the Mother the sum of $527.16 being his share of the following expenses:

Expense	Date	Amount owing by Father
Dr A, paediatrician	07/10/2014	$50.33
Dr K, paediatrician	07/10/2014	$25.00
Dr J, child psychologist	20/11/2014	$117.00
(omitted) School grade 2 supply list	2015	$34.20
Y’s speech pathology fees	12/05/2015 16/06/2015 01/07/2015 28/07/2015 25/08/2015 08/09/2015 31/10/2015 31/10/2015	$60.00 $8.13 $32.50 $32.50 $32.50 $32.50 $70.00 $32.50
Total:	$527.16

1. In the event the Mother has not sought a rebate in relation to the expenses set out above, the Father shall be at liberty to seek rebates through his private medical insurance and in the event he receives any rebates he shall pay half of same to the Mother.

2. In the event the Father is seeking orders that the Mother pay his costs of the Departure Application and/or Enforcement Application, by 4:00pm on 7 December 2016 the Father provide to the Court and to the Mother written submissions and a supporting affidavit on the question of costs.

3. No later than 14 days after the receipts of the Father’s written submissions on the question of costs, the Mother provide to the Court and to the Father answering submissions on the question of costs.

IT IS NOTED that publication of this judgment under the pseudonym Peake & Cousins is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 4941 of 2014

MS PEAKE

Applicant

And

MR COUSINS

Respondent

REASONS FOR JUDGMENT

Introduction

1. This is the Mother’s application filed 11 November 2014 seeking the Court make orders pursuant to section 118 of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act) that there be a departure from the Child Support Agency’s assessment of the Father’s liability to pay child support for the parties’ two children X born (omitted) 2008 (“X”) and Y born (omitted) 2010 (“Y”).

2. At the time the Mother filed the child support departure application there were property and parenting matters live before the Court. Prior to filing her departure application, the Mother had sought a departure application through the appropriate process of the Child Support Agency. The Child Support Registrar had, pursuant to section 98E of the Assessment Act refused to determine the Mother’s departure order application on the grounds that it was too complex.

3. For these reasons the Court was satisfied it should deal with the Mother’s departure order application.

4. Final property orders were made on 19 February 2015. Final parenting orders were made on 13 October 2015.

5. The Mother is seeking by way of a departure order that the Father pay:

   a)periodic child support in the sum of $150 per week per child commencing 11 November 2014 until a child support terminating event occurs, such sum to be Consumer Price Index increased on 1 July 2016 and yearly thereafter; and

   b)by way of non-periodic child support:

   i)half of all school sees including excursions, camps, computer equipment, books, stationary, school uniform and sports equipment;

   ii)half of all childcare fees;

   iii)half of all kindergarten fees;

   iv)half of all or any costs associated with any new agreed school enrolment fees for either or both children;

   v)half of any gap medical, prescriptions, dental, speech pathology, orthopaedic, counselling or any health related costs for the children; and

   vi)half of any extracurricular educational, musical and sporting activities for the children.

6. On 26 June 2014 an order was made by consent that provided as follows:

   8. Pursuant to s116(1)(b) of the Child Support (Assessment) Act 1989 the Husband pay the following by way of financial support of the children and such sums not be credited against any Child Support Assessment issued in relation to the children:

   (a) Half of all school fees, including excursions.

   (b) Half of any gap medical and dental costs for the children.

   (c) Half the gap cost of speech pathology costs for Y.

   (d) Half of the costs of new agreed school enrolment.

7. The Mother filed an Application in a Case on 13 November 2015 seeking enforcement of what she alleges are the arrears payable to her by the Father pursuant to Order 8 of the 24 June 2014 orders (“the enforcement application”). The alleged arrears are:

Expense	Date	Amount owing
Dr A, paediatrician	07/10/2014	$50.33
Dr K, paediatrician	07/10/2014	$25.00
Dr J, child psychologist	20/11/2014	$117.00
(omitted) School grade 2 supply list	2015	$34.20
Y's (omitted) School enrolment	08/09/2015	$55.00
Y’s speech pathology fees	03/12/2014 18/12/2014 03/02/2015 17/02/2015 12/05/2015 16/06/2015 01/07/2015 28/07/2015 25/08/2015 08/09/2015 31/10/2015 31/10/2015	$32.50 $32.50 $32.50 $32.50 $60.00 $8.13 $32.50 $32.50 $32.50 $32.50 $70.00 $32.50
TOTAL:	$712.16

1. In response to the Mother’s departure order application, the Father is seeking orders that all previous child support departure orders be discharged, that he contribute half of any gap medical and dental costs for X and Y provided he is consulted and agrees to such costs before such costs are incurred and that otherwise the Mother’s application be dismissed.

2. In relation to the Mother’s enforcement application, the Father formally seeks it be dismissed.

3. It is noted that on 10 March 2016 after service of the Mother’s enforcement application, the Father made an open offer to resolve this application by paying the Mother the sum of $582.16 in full settlement of her application. The Mother rejected the Father’s offer.

4. The Father seeks the Mother pay his costs of both the departure and enforcement applications.

Background

1. The Mother was born in (country omitted) on (omitted) 1973 and is aged 43 years. She is a qualified (occupation omitted) but has been deregistered. She was declared bankrupt on 24 June 2016 and a sequestration order was made against her estate on 11 August 2016. She is currently a full time student studying (course omitted). It is unclear whether she has re-partnered.

2. The Father was born in the (country omitted) on (omitted) 1976 and is aged 40 years. He is a self-employed (occupation omitted). He has remarried and he and his new wife Ms R have twin boys born (omitted) 2016.

3. The parties commenced cohabitation on (omitted) 2005 and married on (omitted) 2005. They separated on 10 January 2014 and divorced 29 April 2015.

4. At the time of separation the parties were residing in the former matrimonial home in (omitted). The Mother ran and owned her own (business omitted). The Father was self-employed and, it is his evidence, was the primary carer for X and Y. In the Mother’s affidavit material filed in support of the property proceedings she deposes to the Father earning and contributing very little to the family household prior to separation. X was attending (omitted) School and Y attended (omitted) Kindergarten.

5. The Father filed an Initiating Application seeking parenting and property orders on 6 June 2014.

6. The terms of the order made pursuant to section 116(1)(b) of the Assessment Act on 26 June 2014 have been previously set out in this judgment.

7. An interim consent order made 28 October 2014 required the Father to reimburse the Mother for half of X’s third term 2014 (omitted) School fees.

8. On 19 February 2015 final property orders were made. Those orders provided for the Mother to pay the Father $12,500 and that she retain the former matrimonial home. Notation C to those orders states: “the Husband opposes the children attending (omitted) School for financial reasons”.

9. On 13 October 2015 final parenting and interim child support orders were made. The parenting orders provide that X and Y live with the Mother and spend alternate weekends, half school holidays and special occasions with the Father. At the time those orders were made the Father was living in Melbourne with his now wife.

10. The interim child support orders suspended Order (8)(a) of the 26 June 2014 orders and provided that if the Mother chose to pay part or all of the school fees for X and Y at (omitted) School in 2016 prior to the determination of her departure application, she was at liberty to seek an order the Father pay half of such fees if successful in that application.

11. The Mother’s child support departure application was listed for mention on 7 December 2015. On that date orders were made for the filing of the parties’ trial material and the application was listed for hearing on 24 June 2016.

12. On 24 June 2016 the Mother had failed to comply with the orders for trial preparation and sought to rely on an affidavit filed and served by her on 23 June 2016. Her affidavit did not address matters of assistance to her application.

13. Accordingly the matter had to be adjourned for hearing to 1 September 2016. Orders were made for the Mother to file a further affidavit by 15 August 2016 to which the Mother was to attach:

    a)all Child Support Agency assessments made by the Child Support Agency in relation to child support payable by the Father; and

    b)copies of all subpoenaed bank statements of the Husband which she claims supports her allegations the Husband’s income is greater than that deposed by him in his sworn financial statement and taxation returns.

    The Mother filed that Affidavit on 1 September 2016, the day of the final hearing.

14. On 13 April 2016 the Mother advised the Father that as from term 2 she had unilaterally changed X and Y’s schools from (omitted) School to (omitted) Primary School in (omitted).

15. At the time of the final hearing the Court was advised the Mother had placed the former matrimonial home in (omitted) on the market for sale. It is the Father’s evidence that the Mother has re-partnered and intends moving to Melbourne. The Mother did not confirm or deny the Father’s evidence in this regard.

16. The Mother applied to the Child Support Agency for an assessment of child support on 30 April 2014. The child support history of the matter is as follows:

Date of assessment	Parties’ adjusted taxable income and Child Support Agency income		Period of assessment	Amount payable
	H	W
08/05/2014	NIL NIL	46,740 22,947	30/04/2014- 29/07/2015	Weekly rate: 50.67 Monthly rate: 220.33
24/08/2014	NIL NIL	28,603 5,080	30/04/2014- 13/07/2014	Weekly rate: 50.67 Monthly rate: 220.33
25/08/2014 (2014 income)	17,450 NIL	29,518 (P) 5,995	01/10/2014- 31/12/2014	As above
31/08/2015	As above		01/10/2014- 23/08/2015	As above
20/10/2015	As above		24/08/2015- 30/11/2015	As above
18/11/2015	As above		24/08/2015- 30/11/2015	As above
20/11/2015	17,450 NIL	20,000 (P) NIL	20/11/2015- 30/11/2015	As above
20/11/2015 (2015 adjusted taxable income)	105,739 82,129	20,000 (P) NIL	01/12/2015- 28/02/2017	Weekly rate: 275.36 Monthly rate: 1197.33
16/03/2016 (following birth of Father’s twins)	105,739 63,223	20,000 (P) NIL	06/03/2016- 28/02/2017	Weekly rate: 216.95 Monthly rate: 943.33

1. The Mother filed a change of assessment application together with hundreds of pages of supporting documents with the Child Support Agency on 31 July 2014. The Child Support Registrar declined to hear the Mother’s application pursuant to section 98E of the Assessment Act on the basis the application was too complex.

2. The Mother filed a second change of assessment application on

   
   

   18 November 2015. The Mother again provided substantial supporting documents to the Child Support Agency. The Child Support Registrar again declined to hear the Mother’s application pursuant to section 98E of the Assessment Act on the basis the application was too complex.

3. In addition to paying his assessed child support, it is the Father’s evidence he paid one half of X’s school fees at (omitted) School from term 3 2014 until November 2015 when his child support increased from $220.33 per month to $1,197.33 per month. The school fees paid by the Father totalled approximately $9,000.

The Evidence

1. The Mother relies upon her affidavits sworn 13 November 2015,

   
   

   23 June 2016 and 1 September 2016.

2. The Mother also sought to rely upon the multitude of affidavits filed by her relating to parenting and property matters. Those affidavits do not assist the Court in relation to the departure application other than providing background material.

3. In addition, the Mother relied upon the following documents:

   a)subpoenaed trust account of O’Farrell Robertson McMahon for legal fees of Mr Cousins;

   b)subpoenaed barrister legal fees of Mr Cousins;

   c)subpoenaed accountant file for Mr Cousins (financial year tax return 2013/2014; financial year tax return 2014/2015);

   d)subpoenaed (omitted) bank account 1 statements of Mr Cousins;

   e)discovered (omitted) bank account 2 statements of Mr Cousins; and

   f)discovered (omitted) bank account statements of Mr Cousins.

4. The Mother also relied upon her Financial Statements sworn 24 June 2014, 21 April 2015 and 27 May 2016.

5. The Mother filed a comprehensive Outline of Case on 1 September 2016. At the final hearing the Mother made oral submissions based on the documentation relied on by her.

6. The Father relied upon his affidavit affirmed 3 December 2015, paragraphs 25-28 and 61-77 of his affidavit affirmed 25 September 2015 and his affidavits affirmed 21 June 2016 and 31 October 2016.

7. The Father also relied upon his Financial Statements sworn 6 June 2014, 18 December 2014, 24 September 2015 and 22 June 2016.

8. The Father relied upon his Outline of Case filed 22 June 2016 and made oral submissions at the final hearing.

The Law

1. Section 117(1) of the Assessment Act provides as follows:

   (1)  Where:

   (a)  application is made to a court having jurisdiction under this Act for an order under this Division in relation to a child in the special circumstances of the case; and

   (b)  the court is satisfied:

   (i)  that one or more of the grounds for departure mentioned in subsection (2) exists or exist; and

   (ii)  that it would be:

   (A)  just and equitable as regards the child, the carer entitled to child support and the liable parent; and

   (B)  otherwise proper;

   to make a particular order under this Division;

   the court may make the order.

2. The Full Court in the matter of Hides & Hatton (1997) FLC 92-759 clearly spelt out that:

   “the jurisdiction to make an order under s.117 departing from an administrative assessment of child support is a discretionary jurisdiction. But as was made clear by the Full Court in Gyselman [1991] FamCA 93; (1992) FLC 92-279, it is a highly structured discretion with the Court being required to adhere to the following strict three-step process and to consider (at 79,064):

   1. Whether one or more grounds of departure in s 117(2) is established.

   If so: 2. Whether it is “just and equitable” within the meaning of s 117(4) to make a particular order.

   3. Whether it is "”otherwise proper” within the meaning of s 117(5) to make a particular order."

3. Section 117(2) of the Assessment Act sets out the grounds of departure for the purposes of sub-paragraph (b)(i) of section 117(1).

4. In the Mother’s Outline of Case she sets out the factors under section 117(2) which she considers are relevant to the application before the Court. Each of these will be considered.

Section 117(2)(a)(ii): special needs of any other child or person that the parent has a duty to maintain.

1. In support of the Mother’s argument this sub-section is relevant to her application, the Mother sets out in her Outline of Case what she alleges are the special needs of Y in particular, as well as X’s school fees and Y’s childcare and preschool costs.

2. As these are not costs relating to “any other child or another person” this ground of departure is not made out.

Section 117(2)(a)(iii): commitments of the parent necessary to enable the parent to support:

(A) himself or herself.

1. The Mother was declared bankrupt on 24 March 2016 and on 11 August 2016 a sequestration order was made under the Bankruptcy Act 1966 (Cth) on the Mother’s estate.

2. The Mother submits she requires extra child support from November 2014 and ongoing to enable her to support herself, X and Y, particularly as she is now a full time post-graduate university student enrolled at (omitted) University for the next three years.

3. In the Mother’s Financial Statement sworn 27 May 2016 she deposes to having liabilities in excess of $1.8 million. She also deposes to having weekly expenses of $3,418 on an income of $235 a week.

4. The Father asserts that the Mother’s expenditure as set out in her Financial Statement overstates her necessary commitments to support herself and the children.

5. It is the Father’s evidence that his current income is only just sufficient to support himself, Ms R and their children as well as paying child support for X and Y as is currently assessed.

(B): any other child or another person that the parent has a duty to maintain.

1. It is the Mother’s evidence that her elderly 81 year old father lives with her and that she has a duty to support him.

2. The Father has remarried and he and his now wife have recently become the parents of twin boys, now aged six months. Ms R is currently engaged in full time home duties caring for the twins and as such the Father has the responsibility to maintain Ms R and their two young sons.

1. There is no doubt the Mother’s financial circumstances are less than ideal. She is however now bankrupt and liabilities will be managed through that process.

2. The amounts claimed by the Mother as reasonable expenditure to support herself and X and Y are extraordinarily generous and I agree with the assertions of the Father that they overstate her necessary commitments to support herself, X and Y.

3. It would also appear that the Mother has recently returned to Melbourne and the current circumstances of where she is living, with whom she is living and who is responsible for the payment of her support is not before the Court.

4. The Mother, whilst a full time student, places no evidence before the Court as to why she is not able to undertake some form of paid employment to assist in her support at this time.

5. The Father is earning a reasonable income but it is apparent from his statement of financial circumstances that his income is only just sufficient to meet his reasonable living expenses.

6. In these circumstances this ground for departure is not made out.

Section 117(2)(a)(iv): high costs involved in enabling a parent to spend time with, or communicate with, any other child or another person that the parent has a duty to maintain.

1. It is the Mother’s submission that because the Father moved to Melbourne and she lives in (omitted) with X and Y in the former matrimonial home, she incurs high costs of travel expenses for changeover. She also asserts she had to purchase a pre-paid phone for X and Y to communicate with the Father.

2. The Father submits that both parents incurred travel expenses for changeover for X and Y to spend time with him.

3. The Father further asserts that the Mother has now moved or will shortly move to Melbourne and therefore neither party will incur high travel expenses when X and Y spend time with him.

4. Both parties have shared the costs of travelling in order to enable X and Y to spend time with the Father. Further, with the Mother’s move to Melbourne this factor is no longer relevant.

5. The Mother places no evidence before the Court as to why she needs a pre-paid phone for X and Y to communicate with the Father rather than such communication being via her phone.

6. This ground of departure is not made out.

Section 117(2)(b): that, in the special circumstances of the case, the costs of maintaining the child are significantly affected:

(ia) because of special needs of the child.

1. The Mother submits that Y will continue to have ongoing speech pathology and paediatrician assessments as a result of his developmental delays.

2. The Mother further asserts that X is academically and musically gifted and that both he and Y will benefit from extra-curricular educational and sports activities outside of school to extend their natural potential.

3. It is the Mother’s evidence that she represented Australia internationally in sports (omitted) and is a referee for state and national (omitted) tournaments. It is her evidence she would like X and Y to commence (hobby omitted) classes for discipline, sports and competition in the hope that they may qualify for future university scholarships.

4. It is the Father’s submission that he has always agreed to pay half of all agreed medical and like gap expenses for Y and X and remains willing to do so, particularly in circumstances where both boys are covered by the private health insurance taken out by he and Ms R.

5. It is the Father’s submission that he supports X and Y enjoying extra-curricular activities as is the norm for all active, healthy, young children. The Father submits that such activities cannot be seen to be out of the ordinary and as such are not a special circumstance.

6. I agree with the Father’s submission that extra-curricular activities do not fall into the category of special circumstance.

7. Given the Father’s offer from the outset to pay half the gap payments for any agreed medical expenditure the ground for departure under this heading is not made out.

Section 11(2)(b): that, in the special circumstances of the case, the costs of maintaining the child are significantly affected:

(ii): because the child is being cared for, educated or trained in a manner that was expected by his or her parents.

1. The Mother submits that both parties had the expectation that X would attend (omitted) School, and Y would attend (omitted) Preschool and then attend (omitted) School when he was old enough for school.

2. It is submitted by the Mother that the Father only contributed to X’s 2014 term 4 and term 1, 2 and 3 2015 school fees and that he did not contribute to Y’s 2015 (omitted) Preschool fees.

3. It is submitted by the Father that he has consistently maintained the position that the parties could not afford to send X and Y to private school whether that be (omitted) School or any other school in the private school system.

4. It is the Father’s evidence that he agreed to pay half of (omitted) School fees from Term 3 in 2014 until October 2015 given the relatively low level of child support he had been assessed to pay in that period. It is the Father’s evidence he made these payments on the clear proviso he did not agree to X and Y attending (omitted) School and that their ongoing attendance was not financially viable given the Mother’s bankruptcy and his relatively low income.

5. Whilst the parties jointly enrolled X at (omitted) School when they were together, it is very apparent from the extensive material filed in these proceedings that the Father was consistent in his belief that it was not financially viable for X to continue to attend (omitted) School or for Y to commence at (omitted) School once the parties separated.

6. It is also apparent from the Father’s material that at no time did he support ongoing private school education for X and Y.

7. The Mother’s decision to remove X and Y from (omitted) School and enrol them in a (omitted) school in (omitted) was a unilateral decision made by her without any consultation with the Father despite there being orders for the parties to have equal shared parental responsibility. Assuming the Mother has again changed or will change X and Y’s school when she moves to Melbourne, there has to be a genuine concern she will again unilaterally, and in breach of the Court orders, choose the school X and Y will attend.

8. In these circumstances X and Y are not being cared for, educated or trained in the matter that was expected by both their parents and as such the cost of school fees are not the responsibility of both parents.

9. Accordingly this ground of departure has not been made out.

Section 117(2)(c): that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child; (ia) because of the income, property and financial resources of either parent.

1. It is submitted by the Mother that the amount of child support paid by the Father from 1 July 2014 through 1 December 2015 was based on an assessment of the Father’s child support income being nil as it was calculated on the income earned by him in 2013/2014. It is the Mother’s submission that in 2014/2015 the Father’s child support income was in fact $82,129 and therefore he should have been paying $1,197.33 a month rather than the $220.33 paid by him.

2. It is the Mother’s submission that she sought that the Child Support Agency review the assessment for this period as early as July 2014 because of the Father’s actual income being greater than his 2013/2014 taxable income but the Child Support Registrar declined to deal with her application because of its complexity.

3. It is submitted by the Father that his child support has at all times been assessed in accordance with the provisions of the Assessment Act.

4. It is further submitted by the Father that for the period of 1 July 2014 to 1 December 2015 in addition to paying child support as assessed by the Child Support Agency, he also paid an additional amount of approximately $9,000 in school fees for X.

5. It is apparent for the period 1 July 2014 to 1 December 2015 the child support payable by the Father should have been $1,197.33 per month, a total of $20,354.61 if based on his actual income for that period. In that period the Father paid child support of $3,796.61 together with school fees of approximately $9,000, a total of $13,796.61. This results in the Father having paid $7,558 less than he would have paid if child support had been assessed on his actual income.

Section 117(2)(c): that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child;

(ib) because of the earning capacity of either parent.

1. It is submitted by the Mother that her earning capacity will essentially be nil in the short to medium term because she is a bankrupt and is a full time post-graduate student.

2. It is submitted by the Mother that the Father’s earning capacity has increased “exponentially”. She provides the following figures:

   2013/2014
   Income received: $41,000

   Taxable income: $17,450

   2014/2015
   Income received: $129,341.25

   Taxable income: $105,379

   2015/2016
   Income received: $131,785

   Taxable income: taxation return for 2015/2016 not yet filed.

3. It is the Father’s evidence that he resumed employment in a full time capacity in March 2014 and that the income received by him since then has remained relatively stable.

4. It is the Father’s evidence that his expenses for the 2015/2016 year will exceed those for the previous financial year so that whilst his gross income is slightly higher than the preceding year, his taxable income for 2015/2016 will be less than it was in 2014/2015.

5. The earning capacity for the Father seems well established at his current level of earnings and there is no evidence before the Court that would indicate that there is an expectation that his earnings will increase dramatically in the future.

6. Further, the Mother provides no evidence that the Father is working other than to his full capacity.

7. This ground of departure is not made out.

Section 117(4)

1. Section 117(4) of the Assessment Act sets out the factors that the Court must have regard to when determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent, to make a particular order under the division. Each of those factors will be considered in turn.

(a) the nature of the duty of a parent to maintain a child

1. Both parties have a duty to maintain X and Y.

(b) the proper needs of the child

1. The Mother asserts Y has developmental delays and submits the Father did not contribute to the payment of any of his costs between the date of separation and July 2014. The Mother also asserts that the Father did not contribute adequately to the daily costs of supporting the children.

2. The Father submits that neither X nor Y’s needs are exceptional. The Father also agrees to pay half of the medical and dental gap expenses for any of X and Y’s treatment or procedures that he agrees to in advance.

(c) the income, earning capacity, property and financial resources of the child

1. Not applicable.

(d) the income, property and financial resources of each parent who is a party to the proceeding

1. The Mother asserts the Father sent a text message on 20 March 2014 in which he acknowledged his salary was (omitted)$85,000 per annum, yet the Child Support Agency assessed his income on 30 March 2014 as nil.

2. The Father agrees that he found full time employment on 12 March 2014. He asserts the Child Support Agency has assessed the amount of child support payable by him in accordance with the provisions of the Assessment Act.

3. The Father’s weekly income only just exceeds his weekly expenditure. The Father does not have substantial property or financial resources as he owns no real estate and received a very modest amount by way of property settlement.

(da) the earning capacity of each parent who is a party to the proceeding

1. The Mother sets out the Father’s income prior to, during and after the marriage in the same terms as were listed in her arguments relating to section 117(2)(c)(ib).

2. The Mother also argues that the Father’s financial capacity is demonstrated by his ability to meet his legal costs of the substantive proceedings between the parties and by his bank statements which allegedly show he spent $1,000 per week on his personal entertainment, social activities and online dating expenses.

3. The difficulty with this latter assertion is that the bank statements of the Father annexed to the Mother’s affidavit do not support this allegation by her.

4. The Father asserts he is working full time and that his current income reflects his earning capacity.

(e) the commitments of each parent who is a party to the proceeding that are necessary to enable the parent to support:

(i)  himself or herself; or

(ii) any other child or another person that the person has a duty to maintain

1. The Mother submits that her bankruptcy, the sequestration order that was made against her in August 2016 and her full time post-graduate university studies for the next three years all impact upon her capacity to support herself, X and Y and the Father therefore needs to pay additional child support to enable her to support herself, X and Y.

2. The Mother also submits that she has the responsibility to care for her elderly 81 year old father.

3. The Father has the responsibility of his now wife Ms R and twin six month old children.

4. The Father asserts that the Mother’s expenditure as set out in her Financial Statement overstates her necessary commitments to support herself and X and Y.

(f) the direct and indirect costs incurred by the carer entitled to child support in providing care for the child

1. The Mother submits that extra-curricular activities such as (hobbies omitted) and sport are not being contributed to by the Father since separation in January 2014.

2. The Father submits that these are usual activities for any children and as such do not form any kind of special or exceptional expense.

(g) any hardship that would be caused:

(i)  to:

(A)  the child; or

(B)  the carer entitled to child support;

by the making of, or the refusal to make, the order; and

(ii)  to:

(A)  the liable parent; or

(B)  any other child or another person that the liable parent has a duty to support;

by the making of, or the refusal to make, the order; and

(iii)  to any resident child of the parent (see subsection (10)) by the making of, or the refusal to make, the order

1. The Mother submits that her, X and Y’s quality of life will be diminished and they will suffer hardship if the departure order is not made given her bankruptcy, full time post-graduate studies and there being no immediate or short-medium term prospect of her earning an income.

2. The Mother submits the Father’s earning capacity has increased “exponentially” since the parties’ separation in January 2014.

3. The Father submits that he would suffer hardship if orders as sought by the Mother were made as his current circumstances see his income only just meeting his current weekly expenditure.

4. The Father further submits he is the sole income earner in his household and in addition to paying child support for X and Y, he is also financially supporting himself, Ms R and their six month old twin boys.

Section 117(5)

1. Section 117(5) of the Assessment Act provides as follows:

   5. In determining whether it would be otherwise proper to make a particular order under this Division, the court must have regard to:

   (a)  the nature of the duty of a parent to maintain a child (as stated in section 3) and, in particular, the fact that it is the parents of a child themselves who have the primary duty to maintain the child; and

   (b)  the effect that the making of the order would have on:

   (i)  any entitlement of the child, or the carer entitled to child support, to an income tested pension, allowance or benefit; or

   (ii)  the rate of any income tested pension, allowance or benefit payable to the child or the carer entitled to child support.

2. Neither party has made submissions in relation to this subsection.

3. The Court notes both parties have a duty to maintain and care for X and Y.

Conclusion

1. The Mother is seeking a departure order that the Father pay to her for periodic support for X and Y the sum of $150.00 per week per child commencing 11 November 2014, such sum to be Consumer Price Index increased on 1 July 2016 and yearly thereafter.

2. It is apparent from the findings made in relation to section 117(2) of the Assessment Act that the Mother has not satisfied any of the grounds which would persuade a Court to make an order in the terms sought by her and as such her application for a departure order in relation to periodic payments is dismissed.

3. What is apparent however from the consideration of the section 117(2) factors is that for the period 1 July 2014 to 30 November 2015 the child support paid by the Father did not reflect the income earned by him during this period. Therefore the Court must consider whether there should be a departure order made for that period that reflects the income earned by him for this period only.

4. As set out previously in this judgment, the child support paid by the Father by way of periodic payments and school fees during this period was approximately $7,500 less than would have been paid in child support to the Mother by the Father during this period based on his income.

5. This finding does not however automatically mean the Court will make a departure order. As has been properly noted, the decision whether to make a departure order is a discretionary one.

6. The Full Court in the matter of Hides & Hatton (supra) held that when determining whether to exercise its discretion to make a departure order from a child support assessment, when considering sections 117(4) and 117(5) the Court:

   “can have regard to the impact on the payer or the payee of the making of a departure order setting liability for a past period and thus immediately creating the burden of arrears for the payer or of a credit for the payee.”

7. If the Court were to exercise its discretion and make a departure order for the period 1 July 2014 to 1 December 2015, it would have the effect of creating a liability for the Father in circumstances where he has neither the financial resources nor the income stream to meet that liability. This is particularly so given his responsibilities to his new family and the proper level of child support he is now paying for X and Y.

8. In these circumstances, I am satisfied that it is not just and equitable that a departure order be made for the period 1 July 2014 to 1 December 2015.

9. The Mother is also seeking orders that the Father pay non-periodic child support being half of all school fees, educational expenses, half all childcare fees, half all kindergarten fees, half all costs associated with any new agreed school enrolment fees, half all gap medical, prescription, dental, speech pathology or orthopaedic counselling or any health related costs and half of all extra-curricular educational, musical or sporting activities.

10. When the Mother issued her application for a departure order, the Father filed a Response in which he agreed to pay half of the medical and dental gap expenses for treatments and procedures undertaken by X and Y that he has agreed to in advance.

11. There is nothing in the Mother’s application for non-periodic child support that meets either the criteria for special circumstances or any of the factors set out under section 117(2).

12. Accordingly, the Mother’s application for orders for the Father to pay non-periodic child support, save that which has been agreed to by him, is not made out. Her application for non-periodic child support is dismissed.

Enforcement Application

1. The Mother is seeking to enforce what she alleges are outstanding payments owed to her by the Father pursuant to Order 8 of the Orders made by consent on 26 June 2014. The alleged arrears are set out in detail earlier in this judgment.

1. It is the Father’s evidence that he paid his share of Y’s speech pathology for 3 December 2014, 18 December 2014, 3 February 2015 and 17 February 2015: a total of $130. The Father provided proof of those payments in his affidavit sworn 22 June 2016.

2. The Father takes issue that he has liability to pay half the costs of the Mother enrolling Y in (omitted) School in 2015 given he did not consent to Y attending that school.

3. The Father also disputes that he has any responsibility to pay half the costs of X privately attending upon Dr J, a consultant psychologist at (omitted) School, as the Mother unilaterally arranged that appointment without consultation with him.

4. Finally, the Father notes that he had responsibility to pay half of any gap medical and dental costs of the children pursuant to Order 8 of the Orders made 26 June 2014. It is the Father’s evidence that whilst the Mother has given him copies of most of the invoices for Y’s speech pathology consultations, it is his understanding that the amount claimed by her is the total cost of the consultation and he is unaware as to whether the Mother has made claim for a rebate under her private health insurance in relation to these expenses.

5. If the Mother has not done so, the Father would seek to be afforded the opportunity to pursue any rebate under his private health insurance which also covers X and Y.

6. Order (8)(d) of the Orders of 26 June 2014 provides for the Father to pay half the costs of new agreed school enrolment. Given the Father did not agree to Y being enrolled at (omitted) School, he cannot be held responsible for half the costs of the Mother enrolling him at that school.

7. In relation to the expenses for X attending upon Dr J, there is nothing in Order (8)(b) that requires the Father to have agreed to the medical treatment prior to him being responsible for half its costs. Accordingly he is responsible to pay half of Dr J’s fees.

8. In those circumstances and taking into account the speech pathology already paid for by the Father, I am satisfied that he owes the Mother a total amount of $527.16.

9. To enable the Father to pursue the possibility of obtaining a rebate for Y’s speech pathology, orders will be made that upon the Mother providing copies of the requisite receipts and details of any rebates received by her for Y’s speech pathology, the Father pay her the sum of $527.16.

10. If the Mother did not pursue a rebate for Y’s speech pathology and the Father is able to obtain such rebate, he shall pay half of any such rebate received by him to the Mother given she has already paid the total cost of this treatment.

Costs

1. The Father in his responding material has sought that the Mother pay his costs of and incidental to these proceedings.

2. Rule 21.01 of the Federal Circuit Court Rules 2001 (Cth) prescribes that an application for costs may be made:

   “(a) at any stage in a proceeding;

   (b) within 28 days after a final decree or order is made; or

   (c) within any further time allowed by the Court.”

3. If the Father wishes to pursue an order for costs he may do so by written submissions accompanied by an affidavit setting out the way in which the amount of costs sought is quantified.

4. Orders will be made that any written submissions and supporting affidavits seeking costs should be filed and served by the Father within 28 days and any submission in reply by the Mother should be filed and served within a further period of 14 days.

I certify that the preceding one hundred and forty three (143) paragraphs are a true copy of the reasons for judgment of Judge Bender

Date: 9 November 2016