Peters and Child Support Registrar (Child support second review)
[2019] AATA 1719
•5 July 2019
Peters and Child Support Registrar (Child support second review) [2019] AATA 1719 (5 July 2019)
Division:GENERAL DIVISION
File Number(s): 2018/6426
Re:Raymond Peters
APPLICANT
AndChild Support Registrar
RESPONDENT
DECISION
Tribunal:Senior Member K Millar
Date:5 July 2019
Place:Adelaide
The decision under review is affirmed.
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Senior Member K Millar
CATCHWORDS
CHILD SUPPORT – child support debt – departure prohibition order – whether applicant satisfies criteria for revocation of departure prohibition order – whether discretion to revoke departure prohibition order should be exercised – decision under review affirmed
LEGISLATION
Child Support (Registration and Collection) Act 1988
Social Security Act 1991
Social Security (Administration) Act 1999SECONDARY MATERIALS
Child Support (Registration and Collection) Regulations 2018
CASES
Naboush and Child Support Registrar [2014] AATA 930
O’Neill and Child Support Registrar [2010] AATA 545
Shahini and Child Support Registrar [2014] AATA 312Whittaker v Child Support Registrar [2010] FCA 43
REASONS FOR DECISION
Senior Member K Millar
5 July 2019
INTRODUCTION
Mr Peters is the father of a child who is now an adult. While Mr Peters’ child was a minor, Mr Peters was liable to pay child support in accordance with a court order. He did not pay his child support liability from 1995 until compulsory deductions from his age pension commenced in 2015. This has resulted in a current unpaid child support liability of $37,032.79, together with non-payment penalties, as at 20 March 2019.
On 17 September 2018, a delegate of the Child Support Registrar (the Registrar) issued a Departure Prohibition Order (DPO) under s 72D of the Child Support (Registration and Collection) Act 1988 (the Act). This prevents Mr Peters leaving Australia without a Departure Authorisation Certificate (DAC).
As Mr Peters’ current wife is from Myanmar, and his sister who lives in the United Kingdom (UK) is currently having treatment for cancer, Mr Peters wants to travel outside of Australia. He applied for the revocation of the DPO under s 72I of the Act on 23 October 2018.
Section 72I of the Act states that a DPO must be revoked if certain circumstances exist or if the Registrar considers it is desirable to do so.
Mr Peters’ application was refused on 24 October 2018, and he has applied to this Tribunal for a review of the decision not to revoke the DPO. In issue in this matter is whether any of the circumstances exist to revoke the DPO; and, if none of these circumstances exist, whether it is desirable to revoke the DPO.
JURISDICTION
Under s 72T of the Act, an application may be made to this Tribunal for a review of a decision of the Registrar not to revoke a DPO under s 72I of the Act.
BACKGROUND
Mr Peters’ child was born in 1989. On 4 May 1990, court orders[1] were made requiring Mr Peters to pay child support at the rate of $65.00 per week. The child support assessment application was accepted on the basis of the court orders on 20 July 1990.
[1] Exhibit A9.
On 17 September 2018, the Registrar made a DPO under s 72D of the Act prohibiting Mr Peters departing Australia for a foreign country.
As at 20 March 2019, Mr Peters’ arrears were $98,108.55; being $37,032.79 in child support and $61,075.76 in penalties.
LEGISLATIVE FRAMEWORK
The relevant legislation is contained in the Child Support (Registration and Collection) Act 1998, and in particular Part VA of the Act which contains the provisions that relate to DPOs.
The Registrar may make a DPO under s 72D of the Act where a person who has a child support liability has not made satisfactory arrangements for the liability to be wholly discharged, and the Registrar is satisfied that the person has persistently and without reasonable grounds failed to pay the liability, having regard to a number of factors in s 72D(2) of the Act, which include a person’s capacity to repay the liability.
A person aggrieved by a decision to issue a DPO may appeal to the Federal Court of Australia or the Federal Circuit Court of Australia (s 72Q of the Act).
A person who is subject to a DPO may apply to have the DPO revoked under s 72I of the Act, which states:
(1)The Registrar must revoke a departure prohibition order in respect of a person if:
(a)the person no longer has a child support liability or carer liability; or
(b)the person has a child support liability or carer liability, but arrangements satisfactory to the Registrar have been made for the liability to be wholly discharged; or
(c)the person has a child support liability or carer liability, but the Registrar is satisfied that the liability is completely irrecoverable.
(2)…
(3)The Registrar may also, at the Registrar’s discretion, revoke or vary a departure prohibition order in respect of a person if the Registrar considers it desirable to do so.
(4)…
Mr Peters has applied for the DPO to be revoked. It follows that the issues to be considered are whether circumstances exist that mean the DPO must be revoked, or whether it is desirable to revoke or vary the DPO.
CONSIDERATION
The Tribunal considered each of the circumstances in s 72I(1) of the Act in turn before considering whether it is desirable for the DPO to be revoked or varied.
While Mr Peters takes issue with the making of the DPO, this is not a decision that the Tribunal has the power to review. A person aggrieved by the making of a DPO may appeal to the Federal Court of Australia or the Federal Circuit Court of Australia (s 72Q of the Act).
Does Mr Peters no longer have a child support liability?
The DPO must be revoked if the person no longer has a child support liability (s 72I(1)(a) of the Act).
Consent orders were made by the Family Court on 4 May 1990 that Mr Peters pay $65.00 per week to the Director, Child Support for maintenance of the child.[2] On 27 October 1994, the Family Court dismissed Mr Peters’ application to discharge or vary this order.[3] Among other orders, the court ordered that action for enforcement of arrears be suspended for three months and that, on the sale of his unit, Mr Peters pay the arrears of child support. It was ordered that, until such time, Mr Peters was to pay the arrears at the rate of $20.00 per week in addition to the $65.00 per week.
[2] Ibid.
[3] Exhibit A8.
This does not, as argued by Mr Peters, reduce his liability to $20.00 per week subject to his ability to pay. While Justice Burton, at page 5 of the reasons for the decision, states that the amount of $65.00 per week is appropriate subject to his ability to pay, this does not, as Mr Peters has argued, mean that he only has to pay if he considers he is able to do so. This interpretation is also not supported by the Orders that were ultimately made.
It is not open to the Tribunal to look behind the child support assessments that have been made.[4] Mr Peters has a child support liability of $37,032.79, as shown by a certificate[5] issued by the Registrar under s 116(2) of the Act. The production of a certificate issued under s 116 of the Act is prima facie evidence of the matters stated in the certificate. The Tribunal accepts this certificate is accurate.
[4] O’Neill and Child Support Registrar [2010] AATA 545 at [18].
[5] Exhibit RA.
As Mr Peters has a child support liability, the circumstance in s 72I(1)(a) of the Act does not exist.
Has Mr Peters made arrangements such that the Tribunal is satisfied the liability will be wholly discharged?
Under s 72I(1)(b) of the Act, a DPO must be revoked if the person has a child support liability, but arrangements satisfactory to the Registrar have been made for the liability to be wholly discharged.
A satisfactory arrangement is one that leads the Registrar, or the Tribunal in its place, to be satisfied that the debt will be wholly discharged. A debt is wholly discharged when no part of it remains owing.
Mr Peters believes that the compulsory deduction of $50.01 from his age pension is a satisfactory arrangement. The Registrar does not agree because the deductions are not voluntary, and Mr Peters has made statements to the effect that he would stop these deductions from his age pension if he could.
At the hearing, Mr Peters said it is impossible for him to wholly discharge his child support liability. He has approached his sister and the bank but cannot obtain further loans. He said he sees the deductions from his pension as a “quasi arrangement” that is satisfactory because his son has told him he does not want the child support paid. Mr Peters thought the mother also didn’t want it paid.
The child support liability remains in place and, as acknowledged by Mr Peters, it is not possible for him to make arrangements such that the debt will be wholly discharged. It follows that the circumstance in 72I(1)(b) of the Act does not exist.
Is the child support liability completely irrecoverable?
A debt is completely irrecoverable when there is no prospect that the debtor will be able to make any payment towards it. A high threshold must be satisfied to prove that a debt is completely irrecoverable. Even where a debtor has not received any income from work or income support payments for many years, their debt will not be regarded as completely irrecoverable if it is possible that the debtor could obtain work or financial assistance at some time in the future to meet at least part of the debt.[6]
[6] Naboush and Child Support Registrar [2014] AATA 930.
Mr Peters submits that because he is 73 years of age and has medical conditions, it will not be possible for the total amount to be recovered. The test is whether the liability is “completely irrecoverable” and is not whether the total amount can be recovered. The Tribunal does not accept Mr Peters’ argument that, as the whole amount may not be completely recovered, that it is completely irrecoverable.
The debt is not completely irrecoverable because Mr Peters receives a Centrelink payment from which his child support liability can be recovered. He also receives a UK pension from which payments could be made, however he does not choose to apply this to his child support liability.
The Tribunal is not satisfied the liability is completely irrecoverable, and the circumstance in s 72I(1)(c) of the Act does not exist.
Is it desirable to vary or revoke the DPO?
The exercise of a discretion in the Act must take into account the purpose and objects of the Act.[7]
[7] Whittaker v Child Support Registrar [2010] FCA 43 at [317], [323] in relation to making a DPO; Shahini and Child Support Registrar [2014] AATA 312 at [14].
The principal objects of the Act are to ensure that children receive, from their parents, the financial support that the parents are liable to provide, that periodic amounts payable by parents towards the maintenance of their children are paid on a regular and timely basis, and that Australia is in a position to give effect to its obligations under international agreements or arrangements relating to maintenance obligations arising from family relationship, parentage or marriage.[8]
[8] section 3 of the Act.
In this case, Mr Peters has not made periodic payments on a regular and timely basis. He argues that as his son is now an adult, and has stated to Mr Peters he is not seeking the payment of child support, this should mean he is not liable to pay and so is able to travel.
The purpose of child support is to financially support Mr Peters’ child on a regular and timely basis at the time he required this support. As his child support was not paid, this moved the financial obligation to support the child onto the mother and, to the extent the mother received any income tested payments, onto the Australian community. In arguing that he should not be required to pay his child support liability because he did not pay it and it is now in the past, undermines the purpose of the legislation and would provide an incentive not to pay child support in a timely manner.
As stated in O’Neill and Child Support Registrar,[9] matters that should be taken into account relate to the individual circumstances of the person and include:
“… the current amount of their child support liability, the extent to which the liability has become irrecoverable, the nature and purpose of the proposed travel and the likely impact of that travel on the capacity of the Registrar to recover the debt. I also consider that the statutory framework contemplates regard being had to the fact that a person subject to a DPO may apply for a DAC in respect of any particular instance of proposed travel.”
[9] [2010] AATA 545 at [24].
There is currently a relatively large amount owing in child support.
In looking at whether the extent to which the liability has become irrecoverable, the Registrar provided AUSTRAC searches[10] showing Mr Peters has transferred significant sums of money from bank accounts he holds in the UK to his bank account in Australia. He transferred $3,194.00 from the UK to Australia on 30 January 2018, and $1,670.00 on 17 November 2017. He has previously transferred over $14,500.00 in 2016, over $13,000.00 in 2015, and over $26,500.00 in 2014.
[10] Exhibit ST1-98, pages 37 – 56.
Mr Peters says he receives a pension in the UK which is paid to accounts in his name. He did not provide statements for any accounts he holds in the UK, and the Tribunal does not have documentary evidence of the balance of any account he holds. Mr Peters could not recall the balance.
Mr Peters said his sister loaned him $30,000AUD to re-establish himself in Australia, and he has given her a card to access his bank account in the UK for repayments of this amount. He says this comes from an account held in his name into which his UK pension is paid. He says the large amounts transferred to him were for re-establishment costs from his sister and are shown by the annotation “loan” in the AUSTRAC records.
Mr Peters provided a deed[11] dated 1 October 2014 recording a loan from his sister of 135,000GBP, which is repayable within 120 days of demand. No such demand has been made, and Mr Peters estimates this debt is now 165,000GBP. He said he has tried to repay the interest, which is listed in the deed as 1.5%. There are no ledgers of repayments.
[11] Exhibit A11.
Mr Peters said at the hearing that “morally he has to pay his sister first”. The Tribunal considers this shows that he prioritises payment to his sister above his child support liability. It also shows that he chooses to apply income he has in the UK for purposes other than paying his child support liability. The Tribunal considers that having a source of income that Mr Peters chooses not to apply to his child support debt weighs heavily against revoking or varying the DPO. It also shows that the child support is not completely irrecoverable.
In the course of the hearing, Mr Peters disputed information in the documents provided by the Registrar, which he considered could show he held property or has other financial resources. The Tribunal accepts he does not currently hold any property in Australia.
Mr Peters says he lives hand to mouth and also borrows cash from his cousin. He repaid a loan from his cousin from money he says was brought to Australia by his wife and that he now owes this amount to his wife. While this may be the case, it does not account for financial resources he has in the UK that he does not choose to apply to his current living expenses or his child support liability.
Mr Peters says his sister has cancer and a purpose of his travel is to visit her. He provided a list of radiotherapy treatment dates for his sister, however did not provide a current medical report on the nature and current effect of her condition. While the Tribunal accepts Mr Peters is concerned for his sister, and that being apart from her when she is unwell may be difficult, he can apply for a DAC under s 72K of the Act to travel for a particular period.
Mr Peters said he has applied for a DAC on two separate occasions and was refused on both occasions. Mr Peters can seek review of the decision to refuse the DAC under s 72L of the Act or apply for a further DAC. In the circumstances of this case, as Mr Peters can apply for a DAC to visit his sister, and this is more appropriate than revoking or varying the DPO, the Tribunal does not consider this supports the revoking of the DPO.
Mr Peters said that if he remains overseas he will “give” all of his age pension for the payment of his child support liability and as a result it will be received sooner than if he returned to Australia. Mr Peters may offer security under s 72M of the Act for the issuing of a DAC however, as this is not a review of a decision to refuse to issue a DAC, this has little weight where the child support liability remains outstanding.
The Tribunal also doubts Mr Peters could offer this as security. The Social Security Act 1991 and the Social Security (Administration) Act 1999 prevent Centrelink from withholding a person's entitlements to a pension for the purposes of child support except where s 72AA of the Act applies. Section 72AA of the Act and r 20 of the Child Support (Registration and Collection) Regulations 2018 limit the amounts that can be deducted by the prescribed periodic deduction. The prescribed periodic deduction is three times the minimum social security rate for the instalment period, less any amount to be deducted from the person’s pension or benefit under s 72AA(1)(b) of the Act. In Mr Peters’ case, the prescribed periodic deduction is approximately $1,300.00 per year.
The Tribunal considers his travel, should he remain overseas, would have a significant impact on the capacity of the Registrar to recover the debt.
Having considered the objects of the legislation, the current amount of the child support liability, the extent to which the child support can be recovered, the nature and purpose of the travel, and the likely impact of the travel on the Registrar’s ability to recover the debt, the Tribunal is not satisfied that it is desirable to revoke or vary the DPO under s 72I(3) of the Act.
CONCLUSION
As the circumstances in which a DPO must be revoked do not exist, and the Tribunal is not satisfied it is desirable to vary or revoke the DPO, the decision under review is affirmed.
DECISION
The decision under review is affirmed.
52. I certify that the preceding 51 (fifty-one) paragraphs are a true copy of the reasons for the decision herein of Senior Member K Millar
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Associate
Dated: 5 July 2019
Date of hearing: 24 April 2019 Applicant: In person Advocate for the Respondent: Mr Christopher Bishop, Mills Oakley Lawyers
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