Pearce and Pearce and Anor (SSAT Appeal)
[2016] FCCA 1789
•18 July 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| PEARCE & PEARCE & ANOR (SSAT APPEAL) | [2016] FCCA 1789 |
| Catchwords: CHILD SUPPORT – Appeal – Social Security Appeals Tribunal – Appeal from decision of Social Security Appeals Tribunal – departure from administrative assessment of child support – whether SSAT failed to consider all relevant factors – whether SSAT failed to make a determination which was just and equitable – whether the SSAT failed to make necessary and obvious inquiries – procedural fairness – whether Appellant was denied procedural fairness – matter remitted. |
| Legislation: Child Support (Assessment ) Act 1989 (Cth), ss.98B, 98C, 117 Child Support (Registration and Collection) Act 1988 (Cth), s.110B Migration Act 1958 (Cth), s.414 |
| Cases cited: Australian Postal Corporation v Hughes [2009] FCA 1057 |
| Appellant: | MS PEARCE |
| First Respondent: | MR PEARCE |
| Second Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | PAC 2109 of 2013 |
| Judgment of: | Judge Scarlett |
| Hearing date: | 15 February 2015 |
| Date of Last Submission: | 17 August 2015 |
| Delivered at: | Sydney |
| Delivered on: | 18 July 2016 |
REPRESENTATION
| Counsel for the Appellant: | Mr Longworth |
| Solicitors for the Appellant: | Legal Aid NSW |
| First Respondent: | No appearance |
| Solicitor for the Second Respondent: | Ms Nixon |
| Solicitors for the Second Respondent: | Lander & Rogers |
ORDERS
The Appeal is allowed
The Decision of the Social Security Appeals Tribunal made on 13 May 2014 and posted on 23 May 2014 is set aside.
The matter is remitted to the Administrative Appeals Tribunal (Social Services and Child Support Division) for re-hearing according to law.
Any party seeking an Order for costs should file and serve an Application in a Case and an affidavit setting the amount of costs sought and the manner in which they are calculated within seven (7) days of the date of this Order.
IT IS NOTED that publication of this judgment under the pseudonym Pearce & Pearce & Anor (SSAT Appeal) is approved pursuant to s.110X(4)(h) of the Child Support (Registration and Collection) Act 1988 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
PAC 2109 of 2013
| MS PEARCE |
Appellant
And
| MR PEARCE |
First Respondent
| CHILD SUPPORT REGISTRAR |
Second Respondent
REASONS FOR JUDGMENT
Appeal
This is an Appeal from a decision of the Social Security Appeals Tribunal made on 13th May 2014 and posted on 23rd May 2014.
The Tribunal, in its decision, set aside the decision under review and, in substitution, decided to depart from the administrative assessment of child support so as to provide that:
a)for the period 23rd August 2013 to 23rd October 2013 the adjusted taxable income of the First Respondent, who was the Applicant before the Tribunal, was set at $93,783.00;
b)for the period 24th October 2013 to 27th January 2014, the adjusted taxable income of the First Respondent was set at $0; and
c)for the period 28th January 2014 to 30th June 2014, the adjusted taxable income of the First Respondent was set at $40,000.00.
The Appellant filed a Notice of Appeal on 25th June 2014. The Notice of Appeal was supported by an affidavit of the Appellant affirmed on the 24th June 2014.
The Child Support Registrar filed a Notice of Address for Service on 1st August 2014.
The First Respondent filed a Notice of Address for Service on 5th August 2014.
On 19th August 2014 the Appeal was listed for final hearing on 10th February 2015.
The First Respondent did not appear at the hearing and Ms Nixon, the solicitor for the Child Support Registrar, told the Court that it was the understanding of the parties that he had indicated that he would not be participating or appearing in the matter but he would abide by the Court’s outcome.
In her Notice of Appeal, the Appellant sought the following Orders:
1. The decision of the Social Security Appeals Tribunal (SSAT) dated 13 May 2014 (date of posting 23 May 2014) in Review Number (omitted) be set aside.
2. The matter be remitted to the SSAT to be determined according to law.
The Appellant relied on seven Grounds of Appeal:
1. The SSAT erred in law in failing to consider all relevant factors pursuant to section 117 of the Child Support (Assessment) Act 1989 (the Assessment Act), namely the hardship that would be caused to the child by the making of the determination (section 117(4)(g)(i)).
2. The SSAT erred in law in failing to consider all relevant factors pursuant to section 117 of the Assessment Act, namely the hardship that would be caused to the carer entitled to child support by the making of the determination (section 117(4)(g)(i)).
3. The SSAT erred in law in failing to make a determination which was just and equitable as regards the children, in that it failed to have regard to the hardship that would be caused by the making of its determination (section 117(1)(b)(ii)(A)).
4. The SSAT erred in law in failing to make a determination which was just and equitable as regards the carer entitled to child support, in that it failed to have regard to the hardship to the carer entitled to child support that would be caused by the making of its determination (section 117(1)(b)(ii)(A)).
5. The SSAT erred in the discharge of its duties and exercise of its jurisdiction in failing to make necessary and obvious inquiries as to the critical facts and effect of its determination, in circumstances where the effect of the determination could be to cause an overpayment of child support and the SSAT did not have this information before it.
6. The SSAT erred in law in failing to act reasonably by making necessary and obvious inquiries as to the critical facts and effect of its determination, in circumstances where the effect of the determination could be to cause an overpayment of child support and the SSAT did not have this information before it.
7. The Applicant was denied procedural fairness, in that the SSAT did not put her on notice that a determination that would cause an overpayment of child support was being considered and did not give her an opportunity to respond and place relevant material before it.
Background
The background facts are set out in paragraphs [1] to [13] of the Tribunal’s Reasons for Decision. The Tribunal said:
1.Mr Pearce and Ms Pearce are the parents of X, born (omitted) 2000, and Y, born (omitted) 2005. Mr Pearce is the parent liable to pay child support for the children.
2.For the period 1 September 2013 to 30 June 2014, Mr Pearce was assessed to pay an annual rate of child support of $1,294, based on his estimated income of $0 and Ms Pearce’s 2012-2013 adjusted taxable income of $26,316.
3.For the period 1 July 2014 to 30 November 2014, Mr Pearce was assessed to pay an annual rate of child support of $10,400, based on his 2012-2013 adjusted taxable income of $116,468 and Ms Pearce’s 2012-2013 adjusted taxable income of $26,316.
4.On 17 September 2013, Mr Pearce provided a new estimate and the child support assessment was changed so that, for the period 17 September 2013 to 30 June 2014, Mr Pearce was assessed to pay an annual rate of child support of $391.00, based on his estimated income of $17,585.00 and Ms Pearce’s 2012-2013 adjusted taxable income of $26,316.
5.For the period 1 July 2014 to 28 July 2014, Mr Pearce was assessed to pay an annual rate of child support of $391, based on his 2012-2013 adjusted taxable income of $116,468.00 and Ms Pearce’s 2012-2013 adjusted taxable income of $26,316.00.
6.For the period 29 July 2014 to 30 November 2014, Mr Pearce was assessed to pay an annual rate of child support of $23,424.00, based on his 2012-2013 adjusted taxable income of $116,468.00 and Ms Pearce’s 2012-2013 adjusted taxable income of $26,316.00.
7.On 29 September 2013, Ms Pearce applied to the Department of Human Services – Child Support (Child Support) for a departure from the assessment on the ground that the assessment did not correctly reflect Mr Pearce’s income, property, financial resources or his capacity to earn an income (Reason 8).
8.On 13 November 2013, a senior case officer acting as a delegate of the Child Support Registrar (the Registrar) considered the application. The senior case officer considered Reason 8 was established and determined a departure from the administrative assessment so that, for the period 17 September 2013 to 31 October 2015, Mr Pearce’s adjusted taxable income is set at $116,000.00.
9. On 22 November 2013, Mr Pearce objected to the decision.
10.An objections officer reconsidered the matter and, on 13 January 2014, disallowed the objection.
11.On 20 January 2014, Mr Pearce applied to the Social Security Appeals Tribunal (the Tribunal) for a review of the decision.
12.The application was heard by the Tribunal on 13th May 2014 in Sydney. Mr Pearce attended in person and Ms Pearce attended by conference telephone. A representative of the Registrar did not attend the hearing.
13. The Tribunal had before it the statements and documents provided under subsection 95(3) of the Child Support (Registration and Collection) Act 1988 (Cth) (pages 1 to 253). The Tribunal also had before it additional documents provided by Mr Pearce (pages A1 to A49) and Ms Pearce (pages B1 to B25). Copies of these additional documents had been forwarded to the parties.
The Tribunal Decision
In its decision, the Tribunal first of all identified the issues. The Tribunal referred to the fact that the rate of child support payable by a parent for their child for a child support period is normally based on an administrative assessment made by child support acting for the Registrar under part 5 of the Child Support (Assessment) Act 1989 (Cth). Child Support applies a formula set out in the Act which takes into account factors including the number of children, the level of care provided and the adjusted taxable income of each parent.
Either party may apply under part 6A of the Act (section 98B) to Child Support for a determination to depart from the administrative assessment because special circumstances exist. Child Support refers to this as a change of assessment application. The term “special circumstances” is not defined in the Act, but in Gyselman & Gyselman[1], the Full Family Court indicated that, for there to be special circumstances, the facts of the case must establish something that is special or out of the ordinary.
[1] (1992) FLC 92-279
The Tribunal went on to note that section 98C of the Act requires Child Support and the Tribunal, when conducting a review, to be satisfied as to three matters when considering in the special circumstances of the case there should be a departure from the administrative assessment. They are:
(1)that a reason or ground to change the assessment exists (with reference to subsection 117(2) of the Act);
(2)that a departure would be just and equitable as regards the child, the liable parent and the carer to whom child support is payable, and;
(3)that it would be otherwise proper to change the assessment having regard to the primary duty of the parents to provide support for the child and whether making a determination will affect the rate of family tax benefit paid for the child.
The Tribunal went on to consider whether a ground existed to depart from the administrative assessment and, in doing so, considered subparagraphs 117(2)(c)(ia) and (ib) of the Act and subsection 117(7B) of the Act. The Tribunal noted that Ms Pearce indicated, amongst other things, that Mr Pearce had left his job voluntarily and stated that his child support liability should be based on his 2012/2013 income of $116,000.00.
Mr Pearce told the Tribunal that Child Support said that he had quit his job to avoid paying child support and that he has the ability to earn the same amount he was earning at (employer omitted). He denied that this was the case. He said he was asked to leave his position at (employer omitted) and that it took him until February 2014 to find another job where he was being paid a start-up salary. The Tribunal then went on to consider the evidence of both the Appellant and the First Respondent.
The Tribunal then went on to discuss the evidence and found, at paragraph 48 of the decision, that at the time of the departure application the First Respondent was no longer working and he had no income. However, his year to date salary as at 23rd August 2013 was $12,263.00 and he had received a gross payment of $14,791.49, the equivalent of about two months’ salary, on 28th August 2013. He was effectively paid his usual salary for two months after ceasing work. At that time he was assessed to pay an annual rate of child support of $391.00.
The Tribunal considered that the income or financial resources available to him made that assessment unfair to Ms Pearce and the children. The Tribunal went on to consider that this amounted to special circumstances that took the case out of the ordinary. The Tribunal then concluded that the ground for departure in subparagraph 117(2)(c)(ia) in the Act was made out.
The Tribunal then went on to consider whether it would be just and equitable to make a particular departure determination and, in doing so, the Tribunal referred itself to the matters in subsections 117(4) through to (9) inclusive. In doing so, they referred to the decision in Gyselman’s case. The Tribunal stated that it had regard to the documentary evidence and the oral evidence at the hearing.
The Tribunal noted that each of the parties had a duty to maintain the two boys. The Tribunal considered the proper needs of the children, noting that the older boy, aged 13 at the time, has ADHD and a learning disability. The younger boy is aged 9. Both children attend public schools. The older boy attends high school and the younger boy is in primary school.
The Appellant had said that both boys may need to go into IM classes at school and this may require changes to the schools but that had not been decided. The Tribunal considered the income, earning capacity, property and financial resources of the children and found that they are full-time students. The Tribunal considered the income, property and financial resources of each parent and found that the First Respondent was employed on a full-time basis, his employment having commenced on 28 January 2014 and his annual salary was $40,000.00. He lived in his own home. He had little savings. He had a motor car.
The Mother, being the Appellant, received a carer payment and a carer allowance for the older boy from Centrelink, as well as family tax benefit for both children. She and the two children lived in the former family home. They intended to remain there on completion of the property settlement.
The Tribunal went on to consider the earning capacity of each parent but concluded at paragraph 63 that it was unable to have regard to the First Respondent’s earning capacity.
The Tribunal noted that the Appellant does not work but concluded that it was not appropriate to have regard to any greater earning capacity that she may have. Thus the requirements of subsection 117(7B) of the Act were not met in her case.
The Tribunal then considered the necessary commitments of the parents to support themselves and, in doing so, relied on the statements of financial circumstances provided by the parties.
The Tribunal looked at the parents’ legal duty to support another person and noted that neither the Appellant nor the First Respondent had a legal duty to support any other person. The Tribunal then considered hardship that would be caused to the parents and the children, noting that the First Respondent had told the Tribunal he did not have the capacity to pay the rate of child support assessed following the Appellant’s departure application and the Tribunal accepted that that was correct.
The Tribunal considered that the Appellant’s sole source of income, apart from child support, was the Centrelink payment that she receives and stated at [71]:
Clearly any reduction in the rate of child support is likely to cause her hardship.”
The Tribunal went on to say at paragraph [72]:
“The Tribunal considers that an assessment that takes account of Mr Pearce’s change in circumstances will minimise the hardship to both parents while taking account of Mr Pearce’s capacity to pay child support.
The Tribunal noted that it proposed to depart from the administrative assessment so that:
(a)for the period 23rd August 2013 to 23rd October 2013, the First Respondent’s adjusted taxable income was set at $93,783.00. That was the annual equivalent of the termination pay that he had received when he left (employer omitted).
(b)for the period 24th October 2013 to 27th January 2014, the First Respondent’s adjusted taxable income was set at $0, and;
(c)for the period 28th January 2014 to 30th June 2014, the First Respondent’s adjusted taxable income was set at $40,000.
The Tribunal then concluded, after consideration of the factors in subsection 117(4) of the Act, that it was just and equitable to depart from the administrative assessment. The Tribunal then went on to consider whether it would be otherwise proper to make a particular departure determination and, in doing so, considered the requirements of subsection 117(5).
The Tribunal noted the child support law recognises that each parent has a primary duty to maintain the children and noted that the Appellant received family tax benefit from Centrelink, so the departure determined by the Tribunal would affect the cost to the community by way of family tax benefit. The Tribunal was satisfied that it was otherwise proper to depart from the administrative assessment in this matter.
The Tribunal then set aside the decision under review and departed from the administrative assessment of child support so that:
(a)for the period 23rd August 2013 to 23rd October 2013, the First Respondent’s adjusted taxable income was set at $93,783.00;
(b)for the period 24th October 2013 to 27th January 2014, the First Respondent’s adjusted taxable income was set at $0, and;
(c)for the period 28th January 2014 to 30th June 2014, the first respondent’s adjusted taxable income was set at $40,000.00.
Submissions
Counsel for the Appellant, Mr Longworth, submitted that the hearing before the Tribunal took place on 13th May 2014. He noted that no other party had the benefit of legal representation. He referred the Court to the relevant law, being sections 88, 89, 95(3); 101, 103J, 103K, 103N of the Child Support (Registration andCollection) Act. He also referred to sections 98C and subsection 117(4) of the Child Support (Assessment) Act.
Mr Longworth noted that the appeal was brought under the provisions of section 110B of the Child Support (Registration and Collection) Act, which provides:
A party to a proceeding before the SSAT and a part VIIA may appeal to a court having jurisdiction under this Act on a question of law from any decision of the SSAT in that proceeding.
Mr Longworth went on to refer to a decision of Brown FM in Tasman & Tisdall[2]. He referred the Court also to a decision of Slack FM (now sadly deceased) in Farrens& Farrens(SSAT Appeal)[3]. Mr Longworth also referred the Court to the decision of PJ & Child Support Registrar(SSAT appeal)[4], a decision of Riethmuller FM, as his Honour then was, at paragraph 74, where his Honour referred to the decision of Hides & Hatton[5].
[2] [2008] FMCAfam 126 at [37] and [44]
[3] [2010] FMCAfam 325 at[22]
[4] [2007] FMCAfam 829
[5] (1997) 131 FLR 91; 21 Fam LR 855;FLC 92-759
He submitted that for the purposes of subsection 117(1)(a), the SSAT had jurisdiction to hear the review and noted that the SSAT had found that there were grounds for departure. He went on to submit that, at paragraph 42 of his written submission, it is now known that the practical effect of the SSAT decision was that it created an overpayment of child support to the Appellant which she was immediately required to repay to the First Respondent from her ongoing entitlement to child support.
The SSAT decision does not disclose any knowledge, actual or apparent, of the practical effect of the departure order it proposed to make. He referred in particular to paragraphs 69 to 72 of the Tribunal decision. Mr Longworth went on to submit that it is reasonably open to infer from the SSAT decision that the Tribunal did not have before it and was unaware that the proposed departure order would create the overpayment as has occurred.
However, it should have been apparent to the SSAT that the proposed decision could create an overpayment of child support and it was respectfully submitted that the Tribunal failed to consider that fact. In referring to the transcript, Mr Longworth noted that the Appellant very clearly inquired of the Tribunal as to the ramifications of the decision the Tribunal might make, but the response from the Tribunal Member did not make any reference to the possibility of an overpayment or other retrospective operation of the decision.
It was submitted that the Tribunal Member did not understand the complete potential effect of the proposed order and, in that sense, was misguided. Thus it was submitted that the SSAT fell into appealable error in that, by failing to understand let alone quantify the amount of overpayment that the departure order would create was a failure to consider the practical effect of the orders (See PJ & Child Support Registrar), and that is the SSAT failed to properly inform itself of all relevant information and thereby failed in its jurisdiction.
What Mr Longworth then did was proceed to consider the various grounds. He grouped Grounds 1 and 2 together and submitted that, whilst it was clear that the Tribunal mentioned the word “hardship”, it was not at all clear that the Tribunal had proper regard to the concept as required by subsection 117(4)(g)(i). Further, to the extent that the SSAT mentioned the concept, it was respectfully submitted that the SSAT was misguided as to the effect of the outcome.
If the SSAT did not understand let alone quantify the amount of the overpayment that the departure order would create, then it was impossible for the Tribunal to have properly discharged its duty to consider the hardship that would be caused to the child or the carer. Mr Longworth then referred to a decision of his Honour, Judge Coates in Crowley & Stross(SSAT Appeal)[6] and referred in particular to paragraphs [73] to [75].
[6] [2014] FCCA 1540
During the course of the submissions, it was noted, and it was a relevant point, that this decision upon which the Appellant sought to rely was the subject of an appeal to the Full Court of the Family Court. At the time of the hearing before this Court, namely 15th February 2015, that appeal was pending. Mr Longworth then went on to consider Grounds 3 and 4, whether the SSAT decision was just and equitable, referring to the provisions of section 98C.
He submitted that if the SSAT did not understand let alone quantify the amount of the overpayment that the departure order would create, then it was impossible for the SSAT to have made a decision which was just and equitable.
Mr Longworth then grouped Grounds 5 and 6 together under the heading ‘Whether the SSAT Failed to Make Inquiry’. He pointed out that the function being performed by the SSAT was a merits review of the Child Support Agency decision made on 13th January 2014 by the objection officer and raised the question as to whether there was any obligation upon the SSAT, in discharging its role, to make inquiries to the effect of the decision that it proposed to make.
Mr Longworth noted that the SSAT has wide-ranging powers of information gathering under subsection 95(3), section 103J, section 103K and section 103N of the Child Support (Registration andCollection) Act, but noted that no further information was sought by the SSAT beyond the materials supplied to it and any oral submissions made by the parties in the hearing.
Mr Longworth then went on to refer to the decision of Minister for Immigration and Citizenship & SZIAI and Anor[7]. Mr Longworth referred to the fact that SZIAI concerned an appeal from the Federal Court of Australia allowing an appeal from the Federal Magistrates Court, as it then was, for judicial review of a decision by the Refugee Review Tribunal under section 414 of the Migration Act 1958 (Cth).
[7] (2009) 259 ALR 429; (2009) HCA 39
Mr Longworth submitted, in referring to paragraph [25] of the High Court decision in SZIAI, that, although decisions in the Federal Court concerned that the failure to make obvious inquiries have led to references to a duty to inquire, that term is apt to direct consideration away from the question whether the decision which is under review is vitiated by jurisdictional error.
The duty imposed by the Tribunal by the Migration Act 1958 is a duty to review. It may be that a failure to make an obvious inquiry about a critical fact, the existence of which is easily ascertained could in some circumstances, supply a sufficient link to the outcome to constitute a failure to review. If so, such a failure could give rise to jurisdictional error by constructive failure to exercise jurisdiction. It may be that failure to make such an inquiry results in a decision being affected in some other way. It manifests itself as jurisdictional error.
Mr Longworth submitted that proceedings such as those before the Social Security Appeals Tribunal are highly technical and it would be unreasonable to expect lay participants to understand the detail of the legislative scheme spread over two pieces of legislation, let alone be able to predict, understand or submit as to the practical effect of the decisions which were open to the SSAT. He submitted that the circumstances of the matter before the Tribunal heightened the obligation on the Tribunal in the discharge of its duties and exercise of its jurisdiction.
He submitted the questions which would flow from applying SZIAI would be:
(a)whether the practical effect of the contemplated departure order in creating an overpayment was a critical fact;
(b)whether that information was an obvious inquiry;
(c)whether that information was easily obtained, and;
(d)whether, if the answer to the first three questions is “yes”, was there any error either by way of failure of jurisdiction or a failure to act reasonably.
Mr Longworth submitted that:
(a)the practical effect of the contemplated departure order in creating an overpayment was a critical fact, referring to PJ & Child Support Registrar;
(b)the information as to the practical effect of the contemplated departure order in creating an overpayment was obvious;
(c)the information was easily obtained and, as the answers to the first three questions were all “yes”, the Tribunal fell into error either by way of failure of jurisdiction or a failure to act reasonably.
Mr Longworth then referred to the Appellant’s seventh ground of appeal under the heading Natural Justice. His submission was that the practical effect of the departure order was not apparent in the proceedings, being that it would create an overpayment and thereby a liability upon the appellant. As such, it would have been impossible for the Appellant to understand let alone make submissions upon the issue. Had the Appellant been aware that a retrospective departure was being pursued, she would have been able to address that and make submissions. Such an effect not being apparent and not discussed, the Appellant was accordingly denied basic procedural fairness.
Ms Nixon, solicitor for the Child Support Registrar, submitted that no questions of law were raised by the seven grounds and no error of law could be discerned from the Tribunal’s decision or the manner in which the hearing was conducted. Ms Nixon referred to the fact that the Tribunal’s reasons for the decision complied with the statutory obligation in section 103X(3)(b) of the Child Support (Registration andCollection) Act and the obligation as described by the High Court in the decision of Minister for Immigration and Multicultural Affairs & Yusuf[8]. That is, the Tribunal set out its reasons for the decision, its findings on material questions of fact, and referred to the evidence or other material on which the findings of fact were based.
[8] (2001) 206 CLR 323
On the question of hardship, Ms Nixon submitted that the SSAT set out its findings and recorded the factual matters taken into account to consider hardship and took into account the amount of child support assessed as payable by the First Respondent, the change to his annual income since 28th January 2004 and the fact that, for several months following 24th October 2014, that he derived no income. She submitted that the SSAT also acknowledged that any reduction in the rate of child support was likely to cause the Appellant as her sole source of income was social security benefits.
It was submitted that, based on the factual findings made about the First Respondent’s change of circumstances, in particular the change in his income, the SSAT decided an assessment that takes into account the First Respondent’s change of income would minimise the hardship to both parents while taking into account the First Respondent’s capacity to pay child support.
Ms Nixon considered the right of appeal prescribed by section 110B of the Child Support (Registration and Collection) Act, noting that it was limited to appeal on a question of law and referred to the authority of the decision of Halligan FM, as his Honour then was, in the matter of LDME & JMA(SSAT Appeal)[9]. It was submitted that an appeal on a question of law is more limited in scope than an appeal which involves a question of law and referred to the decision of Flick J in Australian Postal Corporation & Hughes.[10]
[9] (2007) FMCAfam 712
[10] [2009] FCA 1057
Ms Nixon went on to submit that the existence of a question of law was critical to the court’s exercise of its jurisdiction to hear the appellant’s appeal from the SSAT decision. She referred in particular to the decision of Kenny, Stone and Logan JJ in Ranav Repatriation Commission[11], where their Honours said:
The need for a notice of appeal to specify a question of law is not just a matter of pleading. In the absence of a question of law, there is no subject matter for the appeal and the court has no jurisdiction to entertain the proceeding.
[11] [2011] FCAFC 124
In performing the task of hearing an appeal, the Federal Circuit Court is an appellate jurisdiction from the SSAT, as was said by the Full Court of the Family Court in Child Support Registrar & Crabbe& Anor[12], where their Honours relied on the decision of the High Court in Minister for Immigration and Ethnic Affairs vWu Shan Liang.[13]
[12] [2014] FamCAFC 10
[13] (1996) 185 CLR 259; [1996] HCA 6
Ms Nixon then turned to consider the Applicant’s grounds of appeal, beginning with Ground 1. She noted that the Tribunal specifically stated paragraph 51 that it had regard to the documentary evidence and the oral evidence presented at the hearing. She went on to submit that, in making its overall decision, including in relation to hardship, the SSAT took into account the factual findings described at paragraphs 53 to 58 of the SSAT’s decision.
These included findings about the children, the fact of one of the children having ADHD and ongoing medical expenses and that the other child was about to commence the process of being assessed by a specialist medical practitioner in connection with potentially also needing ongoing medical care. The SSAT otherwise found that there was no evidence the children did not incur the usual expenses reflected by the child support formula.
The SSAT did not specifically state anywhere in its decision that it considered the hardship caused to the children by the assessment of child support but given the finding that the decision would cause both parents hardship, it was implicit. Ms Nixon went on to consider the findings of the Full Court of the Family Court in Ross & McDermott[14], where their Honours said at [39] that:
In our view, a practical and flexible approach should be adopted in the task of considering these subsections 117(4) and (5) matters.
[14] [1998] FamCA 134
The SSAT was entitled to take a broad-brush approach when considering the factors in subsection 117(4) of the Child Support (Assessment) Act and it was submitted that the Tribunal’s consideration of hardship did not raise a question of law.
In going on to Ground 2, it was submitted that the SSAT relevantly took into account various matters relating to the Appellant’s financial circumstances and recognised at paragraph 72 of the decision that both parties were suffering hardship.
That statement, she submitted, was entirely consistent with the decision of the Full Court of the Family Court in Gyselman, where their Honours said:
Where families separate, it is likely that, in a number of cases, there will be insufficient income to support the two households at their prior standard or at a reasonable standard. Consequently it is a matter of balancing of competing values, namely the obligation of the absent parent to continue to support his children with; on the other hand, the need for that parent to continue to maintain themselves at a reasonable level.
The submission is that the SSAT fairly and appropriately considered the hardship to the Appellant of a change in child support for making its decision and therefore Ground 2 did not raise a question of law.
In considering Ground 3, Ms Nixon took issue with the Appellant’s submission that the Tribunal erred in law in failing to make a determination which was just and equitable as regards the children, and that it failed to have regard that hardship to the children would be caused by the making of its determination.
She submitted that a process of assessing and deciding a departure application involved a three-step process, as set out in Gyselman, being:
(a)To determine whether the ground or grounds relied upon by the applicant are established.
(b)Having found a ground established, decide whether it is just and equitable to depart, and;
(c)If the above are both established, to then determine if it is otherwise proper to depart from an administrative assessment.
The submission is that the SSAT’s reasons for decision revealed that it complied with this approach in determining the matter and, thus, the ultimate finding of the SSAT about whether it was just and equitable to depart from the administrative assessment of Child Support was a finding of fact and not one that was reviewable by this Court.
In considering the Appellant’s Ground 4 in the Notice of Appeal, it was again submitted that the finding of the SSAT about whether it was just and equitable to depart from the administrative assessment of child support was a finding of fact and not reviewable by the court. Accordingly, it was submitted no question of law was raised.
In considering Ground 5, it was submitted that the ability of the SSAT to obtain information is contained in section 103K of the Child Support(Registration and Collection) Act, which relevantly states “if it is reasonably necessary for the purposes of a review” the SSAT principal member may require a person to give information or attend before the SSAT or produce documents to the SSAT. However, the provisions relating to the powers of the SSAT and the Principal Member in conducting hearings do not impose a mandatory obligation upon the SSAT to undertake inquiries.
Again, the Court considered the obligation of the SSAT to make further inquiries in the matter of PJ & Child Support Registrar[15] at [62] to [64] in the decision of Riethmuller FM. In the present case it was submitted that the transcript reveals that the presiding member informed the parties he did not think any additional information was required before finalising his decision.
[15] supra
It was inherent from the SSAT’s decision that it was satisfied it had sufficient information to determine the incomes of the payer and payee, the circumstances of the children and to complete the three-step process in section 117 of the Child Support (Assessment) Act. As to the effect of its determination, the SSAT was not obliged to decide whether arrears or an overpayment would be created by its decision, nor was it obliged to decide the quantum of any arrears or overpayment.
The obligation of the Tribunal was to consider the practical impact of the possible decision. This does not necessitate a detailed examination of the precise consequences but some consideration of the factors set out in subsection 117(4) of the Child Support (Assessment) Act. It is not necessary to be able to explain the figure arrived at with any precise mathematical method.
Accordingly, it was submitted that the Tribunal was not obliged to make inquiries as to the possibility of an overpayment being caused by the decision and, therefore, it was submitted no question of law was raised by that ground.
A similar submission was made in respect of the sixth ground of appeal and it was submitted that no question of law was raised by that ground.
Turning to the Appellant’s Grounds 7, 8 and 9 of procedural fairness, in that the Tribunal did not put her on notice that a determination would cause an overpayment of child support was being considered and did not give her an opportunity to respond and place relevant material before it, it was submitted that the relevant facts were known to the appellant and it was submitted that the potential of an overpayment being raised was an obvious consequence of the First Respondent’s departure application being successful.
The Tribunal was not obliged to identify specifically the possibility of an overpayment being raised and to seek submissions from the Appellant in order to afford her procedural fairness. What the presiding member did do was address the Appellant and say to her, amongst other things, “If I were to change the amount of income taken into account, how would that affect you? Well, because it would affect the rate of child support, it would decrease the amount of child support payable to you.” The Appellant said, “It’s going to hurt me but it’s one of those things. Nothing I can sort of really do.”
The Tribunal’s obligation, it was submitted, was to consider the practical effect of the decision and the Tribunal did so and decided that an assessment taking into account the First Respondent’s change in circumstances would minimise the hardship caused to both the Applicant and the First Respondent and, therefore, to the children. It is submitted that no question of law was raised by the ground of appeal. Thus, it was submitted that the Appellant had not raised the question of law in any grounds of appeal from the decision of the Tribunal and therefore there was no error of law in the Tribunal decision. The submission was, therefore, the appropriate outcome was for the appeal to be dismissed.
Ms Nixon submitted that the Registrar sought the following orders:
(a)The notice of appeal filed on 25th June 2014 should be dismissed, and;
(b)There should be no order as to costs.
It was relevant that a decision upon which the Appellant sought to rely, a decision of the Federal Circuit Court, Crowley & Stross & Anor (SSAT Appeal)[16]was the subject of an Appeal to the Full Court of the Family Court. The Appeal decision was delivered on 6 May 2015 (Child Support Registrar & Crowley & Stross[17]). In that decision the Full Court allowed the appeal. The parties were given the opportunity to submit further submissions as to the effect, if any, of the appeal decision.
[16] [2014] FCCA 1540
[17] [2015] FamCAFC 76
The Child Support Registrar submitted a document entitled “Second Respondent’s Supplementary Submissions” on 10th August 2015. In that document, the registrar noted the Appellant had relied on the decision of Judge Coates in the matter of Crowley & Stross SSAT Appeal and noted that at the time of the hearing, the decision in Crowley was the subject of an appeal initiated by the Child Support Registrar to the Full Court of the Family Court.
On 6th May 2015, the Full Court delivered its decision granting the Registrar leave to appeal the decision in Crowley and allowed the appeal on all grounds. It was submitted that, relevantly, the third ground of appeal before the Full Court was:
His Honour erred by finding it is necessary to calculate arrears of child support for the purpose of considering hardship under section 117(4)(g) Child Support (Assessment) Act.
In a joint judgment, it was submitted that the Full Court, comprised by Finn, Strickland and Murphy JJ, said about the Registrar’s third ground of appeal, paragraphs 64:
It could not be argued reasonably that the Tribunal failed to consider hardship by reasons of failing to quantify and specify the amount of any arrears. The failure to quantity arrears is not of itself an error of law, and no ground of appeal before the – before his Honour was, in fact, in such a form, nor was there any finding made by his Honour.
On the basis of the Full Court decision, it was submitted by the Registrar that:
In considering whether a departure from an administrative assessment of child support would be just and equitable under subsection 117(4) of the Child Support (Assessment) Act, arrears and overpayments ought to be treated in the same way. To prefer the interests of the receiving parent or the parent with primary custody of the child would be contrary to the objects of the Social Security Appeals Tribunal, which were to pursue the objective of providing a mechanism of review that was fair, just, economical, informal and quick.
It was submitted further that:
Even if the appellant could identify some distinguishing factors that differentiated her case from the case before the Full Court in Child Support Registrar & Crowley & Stross, it was submitted that the Full Court had made it abundantly clear that (a) consideration of arrears or equally an overpayment is but one aspect of what is required by subsection 117(4) of the (Assessment) Act; (b) quantification of arrears or equally an overpayment is not a requirement of subsection 117(4) of the (Assessment) Act; (c) quantification of a potential consequence is not necessarily in order to properly consider it; and (d) failure to quantify the impact of a decision does not raise a question of law.
Thus, it was submitted that:
The reasons of the Full Court in Child Support Registrar & Crowley & Stross do not change the position that (a) the SSAT appropriately considered and determined the question of hardship for the purpose of subsection 117(4) of the (Assessment) Act; (b) the appellant had not identified a question of law in her notice of appeal; and (c) the appellant had not identified an error of law in the decision of the Social Security Appeals Tribunal.
Thus, it was submitted again that the appropriate outcome in this case remained for the appeal to be dismissed and again the registrar was not seeking any order as to costs.
Mr Longworth of Counsel for the Appellant provided two submissions on 17th August 2015, one headed Brief Submissions in Reply, the other headed Updated Submissions. The point of the first of those two submissions was that the submission on behalf of the Registrar was tantamount to saying that the decision-maker, namely, the Social Security Appeals Tribunal needed have to regard to the practical effect of any particular decision. With respect, Mr Longworth submitted, this simply cannot be correct.
Mr Longworth was critical of the fact that the Child Support Registrar had provided a table in the supplementary submissions and submitted that the Court would be cautious in regard to the use and consideration of a table, which had been urged by the Registrar. He referred to the decision of the Full Court of the Family Court in a decision in Fields & Smith (2015)[18], where a table was used in an attempt to understand the parameters within which a particular decision might fall. As was stated by their Honours:
With all due respect to his Honour, the table can only inform the glibbest of comparisons, and although it may be a seductive tool, it cannot eliminate the valuing and weighing of contribution in this particular case, and carries with it the danger, if relied upon, of detracting from the individual requirement to make orders that are just and equitable in an individual case.
[18] FamCAFC 57
Mr Longworth submitted whilst the court in this situation is conducting a different task, the same caution should be exercised. In respect of the updated submissions, Mr Longworth considered the impact of the decision of the Full Court of the Family Court in Child Support Registrar & Crowley. It was his submission that:
The decision of the Full Court in Crowley was distinguishable, and an error of law remains in the subject case. Whilst, in Crowley, there may have been no precise calculation of the level of arrears, there was an understanding and acceptance by the SSAT that arrears would be a consequence, and there was an apparent attempt to calculate the arrears. As the Full Court said at paragraph 65, “The findings and figures referred to by the tribunal reveal plainly, in our view, that the finding with respect to hardship was made (albeit implicitly) by reference to an approximation of the amount of arrears due. In that respect, there is no need for a microscopic examination of the figures. A broad brush approach can be taken.”
His submission was that:
The subject case involves the creation of an overpayment of the carer that she would then have to repay to the paying parent via the registrar. Not only was there no attempt at any calculation by the SSAT, whether an approximation or otherwise, the SSAT seemed to be entirely unaware that an overpayment would even be created.
Thus it was submitted:
The failure by the SSAT to at all understand the impact of its decision was and remains an error of law. The SSAT cannot have discharged its jurisdictional obligation to consider hardship that would be caused to the child and/or the carer where it had no apparent understanding of the outcome. In this particular case, the consequence of the decision was to create an overpayment to the carer.
Conclusions
There are seven separate Grounds of Appeal, although it was conceded by Counsel for the Appellant that Grounds 1 and 2 are grouped together, Grounds 3 and 4 are grouped together, Grounds 5 and 6 are grouped together and Ground 7, the procedural fairness or natural justice ground, stands alone.
There is some force to the submissions of the Child Support Registrar that the Grounds of appeal do not raise any questions of law and that no error of law can be discerned from the SSATs decision or the manner in which the hearing was conducted. I should say at the outset that I do not entirely agree, although it is fair to say only one of the grounds that I can see raises, in fact, an error of law.
As I said, Grounds 1 and 2 can be considered together. They contain an assertion that the Tribunal erred in law in failing to consider all relevant factors under section 117 of the Child Support (Assessment) Act. The Registrar submits that the Tribunal was entitled to take a broad brush approach when considering the factors in subsection 117(4) of the Child Support (Assessment) Act and it was unnecessary for the Tribunal to make a specific finding of hardship in regard to the children, and no error of law is raised in respect of the first ground of appeal.
I am of a view that this submission is correct and the first Ground of Appeal will be dismissed.
I am similarly of a view that as submitted by the Child Support Registrar, the second Ground does not raise a question of law and will also be dismissed.
Grounds 3 and 4 have been grouped together and in a sense similar to Ground 1 and 2, it is accurate to say that a finding by the Tribunal about whether it was just and equitable to depart from the administrative assessment of child support was a finding of fact and not reviewable by the Court and this ground must be dismissed.
Similarly, with Ground 4, the submission was that a finding by the Tribunal that it was just and equitable to depart from the administrative assessment is a finding of fact. Ground 4 will also be dismissed.
Grounds 5 and 6 rely on the decision in SZIAI relating to the duty to inquire. It is not the case that a duty to inquire will arise in every case beyond that which is provided by the legislation. In respect of Grounds 5 and 6, it was submitted that the obligation of the SSAT was to consider the practical impact of the possible decision but this does not necessitate a detailed examination of the precise consequences but some consideration of the factors set out in subsection 117(4) of the Child Support (Assessment) Act.
It is not necessary to be able to explain the figures arrived at with any precise mathematical method and accordingly the Tribunal is not obliged to make inquiries, it is submitted, as to the possibility of an overpayment and no question of law is raised in respect of Grounds 5 and 6.
That said, Ground 7 is the procedural fairness ground. It was submitted that the Tribunal was not obliged to specifically identify the possibility of an overpayment being raised and to seek submissions from the Appellant in order to afford her procedural fairness.
I have difficulty in accepting this proposition. If there is to be the possibility of an overpayment, this may well cause hardship and for an unrepresented Appellant to be deprived of the opportunity to make some submissions on that point, as to the hardship to her and perhaps her children, would seem to me to be lacking in procedural fairness. It is well-established that a lack of procedural fairness or a failure to accord natural justice is a jurisdictional error. I am, after some reflection, persuaded that this Ground of Appeal has been established. It is, of course, necessary for only one jurisdictional error to be found, only one error of law, to vitiate the decision of the Tribunal.
I intend to allow the Appeal based on Ground 7.
I certify that the preceding one hundred and three (103) paragraphs are a true copy of the reasons for judgment of Judge Scarlett
Date: 18 July 2016
0
12
4