PJ & Child Support Registrar (SSAT Appeal)
[2007] FMCAfam 829
•15 October 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| PJ & CHILD SUPPORT REGISTRAR (SSAT APPEAL) | [2007] FMCAfam 829 |
| CHILD SUPPORT – Appeal from SSAT – procedural fairness – whether Tribunal process appropriate. CHILD SUPPORT – Appeal from SSAT – procedural fairness – whether Tribunal failed to give applicant notice of issues being considered. CHILD SUPPORT – Appeal from SSAT – departure application – whether Tribunal took relevant considerations into account – failure to consider relevant factors in determining what assessment would be ‘just and equitable’. CHILD SUPPORT – Departure application – financial resources – availability of paid sick leave. |
| Child Support (Assessment) Act 1989, Part 6A, Part 6B, ss.98S, 117 Child Support (Registration and Collection) Act 1988, ss.88, 94, 96, 97, 101, 103A, 103B, 103C, 103F, 103G, 103K, 103L, 103R, 103S, 103T, 103M, 103N |
| Beck and Beck (No2) (1983) FLC ¶91-318 CCD & AGMD [2006] FamCA 1291; (2006) FLC ¶93-300 Commissioner for the Australian Capital Territory Revenue v Alphaone Pty Ltd [1994] FCA unrep6805; (1994) 49 FCR 576 Dieter & Dieter [2007] FamCA 608 Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 Muin v Refugee Review Tribunal [2002] HCA 30 National Companies and Securities Commission v News Corporation Limited [1984] HCA 29; (1984) 156 CLR 296 Neal v R [1982] HCA 55; (1982) 149 CLR 305 |
| Applicant: | PJ |
| Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | CAM 650 of 2004 |
| Judgment of: | Riethmuller FM |
| Hearing date: | 10 October 2007 |
| Date of Last Submission: | 10 October 2007 |
| Delivered at: | Melbourne |
| Delivered on: | 15 October 2007 |
REPRESENTATION
| The Applicant appearing in person |
| Counsel for the Respondent: | Ms Sekler |
| Solicitors for the Respondent: | Australian Government Solicitor |
ORDERS
That the decision of the Social Security Appeals Tribunal, appeal SC222415 be set aside.
The matter be remitted to the Social Security Appeals Tribunal to hear and determine according to law.
The Child Support Registrar pay the reasonable costs of the transcript of the SSAT proceedings.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT CANBERRA |
CAM 650 of 2004
| PJ |
Applicant
And
| CHILD SUPPORT REGISTRAR |
Respondent
REASONS FOR JUDGMENT
The appellant appeals from a decision of the SSAT made on 27 April 2007 increasing his child support assessment for the period 19 July 2006 to 7 October 2006.
Background
The appellant and his former wife separated in 1997. They have two children, a girl and a boy born in September 1991 and September 1993 respectively. From separation the parties had shared care of the children. In November 1999, shared care orders were made in the Family Court. Until 2003, there was no child support assessment as both parties were working (public servants at the EL2 level) and the children were in a shared care arrangement. In November 2001, the mother accepted a voluntary redundancy package. From 6 January 2003 (when the CSA first assessed the appellant to pay child support, on the application of the mother) until early October 2006, the children remained in the shared care of the parties. From early October 2006, the children have been in the full time care of the appellant. Whilst the appellant disputes the date accepted by the CSA for the change in care arrangements, this relates to a difference of only a week, and was not the subject of this appeal.
From 2003, as a result of the mother’s low income and the appellant’s income of around $99,000 per annum, the appellant was assessed to pay child support to the mother, even though the care of the children was then shared equally.
The appellant sought a departure from this assessment on the basis of the mother’s income earning capacity. The departure application was ultimately the subject of an application in the Federal Magistrates Court heard by FM Mowbray in 2005. The facts and circumstances and the history of the matter are set out in his Honour’s judgement: P & R [2006] FMCAfam 18. In that decision, FM Mowbray accepted medical evidence that the mother was then unable to work (as she was suffering chronic fatigue syndrome) during the relevant period (6 January 2003 to 28 February 2006) and dismissed the appellant’s application. The appellant was critical of the decision, saying that it failed to take account of his claim that the mother would have had significant accumulated sick leave entitlements when she accepted the redundancy. It appears unlikely that that point was clearly agitated before FM Mowbray as it does not appear in the reasons for judgement, and the mother had not sought child support until over a year after she accepted the redundancy. The judgment was not the subject of appeal and the appellant is now estopped from challenging the findings made in those proceedings.
On 19 July 2006, the appellant commenced a period of sick leave. He elected to take that leave without pay, preferring to preserve his significant paid sick leave entitlements (over 330 days) for the future as he believes that he will have ongoing issues with illness. As a result, the appellant’s child support assessment was reduced to nil.
On 28 July 2006, the mother sought an increase in the child support assessment payable by the appellant to account for orthodontic expenses for the eldest child. After becoming aware of the change in the assessment caused by the appellant taking unpaid sick leave, she widened her application to seek an increase based upon the appellant having paid sick leave entitlements that he was not accessing.
The mother was unsuccessful in her application before a Senior Case Officer under Part 6A of the Child Support (Assessment) Act 1989. The mother lodged an objection under Part 6B of the Act. The objection decision was delivered on 17 January 2007. By this time, the care arrangements for the children had changed and the children were in the full-time care of the appellant.
The Objection Officer accepted that the orthodontic expenses were a ‘special circumstance’ under the Child Support (Assessment) Act 1989, and that the appellant’s income amount for child support should be assessed having regard to his available paid sick leave (even if he was not choosing to access that paid leave). However, the Objection Officer did not find that it was ‘just and equitable’ to retrospectively increase the assessment payable by the appellant to the mother as the children were now living with the appellant and he was receiving no child support from the mother.
The decision of the Objection Officer made on 17 January 2007 was simply that:
For the period 15 January 2007 to 29 February 2008 [the appellant’s] child support income amount is set at $99,000.
Although the Objection Officer made a decision to alter the appellant’s ‘child support income amount’ for the future (based upon his earnings and available paid sick leave), this had no effect on the amount of any assessment. This change had no actual effect on the rate of the assessment, and there was no finding that it was likely to affect the amount of the assessment in the future.
The determination made by the Objection Officer to set the appellant’s income amount was one of the determinations that the Registrar had power to make under Part 6A: see s.98S(1)(d). To satisfy s.117(2)(c), the decision maker must find that the administrative assessment ‘would result in an unjust and inequitable determination of the level of child support’. It is difficult to understand how s.117(2)(c) could have been satisfied when the alteration of the appellant’s income amount would not affect the actual amount of child support as calculated by the Child Support Agency in the circumstances of the case.
The SSAT Review
The appellant is aggrieved by the decision of the Objection Officer as he does not accept that his paid sick leave entitlements should be taken into account in determining any child support assessment. He applied to the Social Security Appeals Tribunal for a review of the decision.
There is no ‘notice of review’ or similar document setting out the appellant’s grounds for the review or succinctly describing the complaints of the appellant, nor is one required: see s.94 of the Child Support (Registration and Collection) Act 1988. The Tribunal proceeded to conduct a full review on the merits with respect to the mother’s application for a departure from the administrative assessment as it had been developed in her objection letter.
Neither the mother nor the Child Support Registrar participated in the Tribunal review. The Tribunal held a hearing with the appellant where he was given an opportunity to address the Tribunal. The Tribunal also asked the appellant a number of questions.
In its reasons the Tribunal expressly identified the issues it was considering, saying:
7. The issues for the Tribunal to consider in this matter are as follows:
· is there a reason or reasons establishing a departure from the current assessment of Mr Pearson’s annual rate of child support of $99,000.00 for the period 15 January 2007 to 29 February 2008, having regard to the special circumstances of the case on the basis of Reasons 2 and 8; and if so
· is a change to the assessment just and equitable (fair to both the parents and the children) and otherwise proper (fair to the community).
The references to ‘Reasons 2 and 8’ are references to the categories of special circumstances under sub-sections 117(2)(b)(ia) and 117(2)(c)(ia) of the Child Support (Assessment) Act 1989 as they are described in the Child Support Agency’s Change of Assessment application form and online guide.
Reasons of the SSAT
The Tribunal accepted that orthodontic expenses for the eldest child were a ‘special need’ within s.117(2)(b) which ‘was affecting [the mother’s] capacity to maintain [the eldest child]’ at the time the departure application was lodged. The Tribunal agreed with the Objection Officer that the availability of paid sick leave was a financial resource available to the appellant and therefore ‘Reason 8 is established’.
In determining what change to the assessment would be ‘just and equitable’ and ‘otherwise proper’ under s.117 the Tribunal said:
57. The Objection Officer set [the appellant’s] child support income at $99,000.00 (salary in addition to a bonus of $2,000.00 on a pro rate basis) on the basis that his sick leave entitlements were available to him, and his duty to provide for his children is such that those resources should by used to support them. The change in the assessment, however, was only given effect from 15 January 2007, the date [the appellant] returned to work, so as to avoid creating arrears that would reduce [the appellant’s] capacity to meet the current needs of the children.
58. The Tribunal was of the view that, while there are circumstances in which arrears should be avoided, the outcome in this case is not equitable. At the time [the mother] applied for a change of assessment on 28 July 2006, the children were in her care. It seems from the available evidence that [the mother’s] decision to give the children into the sole care of [the appellant] in October 2006 arose from her financial circumstances following the reduction of her child support payments to $nil in July 2006. As it has been determined by the Tribunal that [the appellant] did have a financial resource available throughout that period, it is appropriate that [the mother] receive the amount of child support for the period that was appropriate based on the circumstances at the time.
59. The Tribunal notes that [the appellant] was aware of the effect that his taking leave without pay would have on the child support assessment. As [the mother’s] main source of income is a Centrelink payment, it would be inappropriate to transfer the financial burden of supporting the children to the taxpayer when [the appellant] had the financial resources available to him to meet his duty to support them. The Tribunal was of the view that to depart from the administrative assessment in this case so as to set [the appellant’s] child support income at $99,000.00 for the period 19 July 2006 to 29 February 2008, the end of the current child support period is just and equitable and otherwise proper.
60. The Tribunal then considered whether a further departure from the assessment is warranted on the basis of Reason 2, for [the eldest child’s] orthodontic treatment. The Tribunal decided that it is appropriate, in the circumstances of this case, to depart form the assessment in relation to [the eldest child’s] orthodontic treatment. The treatment commenced in January 2006 and will take about two years to complete, [the mother] was meeting the costs of treatment and, according to [the appellant], continued to do so after the children left her care. The Tribunal decided that it is appropriate that both parents share the cost of the orthodontic treatment. The Tribunal was of the view that to depart from the administrative assessment in this case because of the special needs of [the eldest child], so that [the appellant’s] annual rate of child support is to be increased by $1625.00 per annum (50% of the overall cost, over two years) for the period 19 July 2006 to 7 October 2006, when the children left [the mother’s] care, is just and equitable and otherwise proper.
Decision of the SSAT
The decision of the Tribunal was in the following terms:
On 27 April 2007 the Tribunal decided to set aside the decision under review and send the matter back to the Registrar of the Child Support Agency for reconsideration in accordance with the following directions:
· For the period from 19 July 2006 to 29 February 2008, [the appellant’s] child support income be set at $99,000; and
· For the period from 28 July 2006 to 7 October 2006 [the appellant’s] annual rate of child support be increased by $1625.00 in respect of [the eldest child’s] orthodontic treatment.
The decision of the Tribunal deals with a period before the period which was earlier identified by the Tribunal to be in issue, and an extra issue not identified at the start of its reasons.
The decision is worded as though it is an exercise of the power set out in s.103S(c)(ii) of the Child Support (Registration and Collection) Act 1988 to ‘send the matter back to the Registrar for reconsideration in accordance with any directions or recommendations of the SSAT’. There is no evidence of any further consideration by the ‘Objections Officer’ or ‘Senior Case Officer’, however a fresh assessment has issued as though this were a decision substituting a new decision for that of the Objection Officer under s.103S(c)(i). It appears from the nature of the decision that the Tribunal were intending to exercise the power in s.103S(c)(i) rather than s.103S(c)(ii).
The practical effect of the Tribunal decision was to create a retrospective debt payable by the appellant to the mother for the period 19 July 2006 to 7 October 2006. To the extent that the alteration related to the period from 8 October 2006 onwards, it suffers the same problems as the determination of the Objections Officer: see paragraphs 10 and 11 above.
Grounds of Appeal
The appellant represented himself in this appeal. Whilst his grounds of appeal are not set out in the usual way, they are apparent from an affidavit that he filed in support of his application and were developed at the hearing. The complaints of the applicant fall into four areas:
a)The appellant was denied procedural fairness as a result of the way in which the Tribunal conducted the appeal;
b)The Tribunal was affected by bias and acted in bad faith;
c)The Tribunal acted without evidence;
d)The Tribunal failed to take relevant considerations into account.
Ground (a) – Procedural Fairness
The appellant’s complaints with respect to procedural fairness were that:
a)he was not told what was alleged against him;
b)he was not given the opportunity to subpoena and cross examine [the mother] or other witnesses;
c)he was not given the opportunity to correct errors in material submitted to the Tribunal or made by the Tribunal;
d)he was not provided with reasons why the Tribunal decided not to gather further information before deciding the appeal.
Before embarking upon a consideration of the specific complaints under this ground it is important to consider what the requirements of procedural fairness entail. In Kioa v West [1985] HCA 81; (1985) 159 CLR 550 Gibbs CJ said (at [11]):
The rules of natural justice are flexible, requiring fairness in all the circumstances, including the nature of the power exercised and the statutory provisions governing its exercise: Bread Manufacturers of N.S.W. v. Evans (1981) 56 ALJR 89, at pp 94, 101; 38 ALR 93, at pp 102, 117; National Companies and Securities Commission v. The News Corporation Ltd. (1984) 58 ALJR 308, at pp 314, 318; 52 ALR 417, at pp 427-428, 434.
Mason J (as he then was) highlighted the need to consider the statutory framework, saying:
32. Where the decision in question is one for which provision is made by statute, the application and content of the doctrine of natural justice or the duty to act fairly depends to a large extent on the construction of the statute. In Mobil Oil Australia Pty. Ltd. v. Federal Commissioner of Taxation [1963] HCA 41; (1963) 113 CLR 475, Kitto J. pointed out (at pp 503-504) that the obligation to give a fair opportunity to parties in controversy to correct or contradict statements prejudicial to their view depends on "the particular statutory framework". What is appropriate in terms of natural justice depends on the circumstances of the case and they will include, inter alia, the nature of the inquiry, the subject matter, and the rules under which the decision-maker is acting (Reg. v. Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group [1969] HCA 10; (1969) 122 CLR 546, at pp 552-553; National Companies and Securities Commission v. The News Corporation Ltd. (1984) 58 ALJR 308, at pp 314, 318; 52 ALR 417, at pp 427-428, 434).
33. In this respect the expression "procedural fairness" more aptly conveys the notion of a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case. The statutory power must be exercised fairly, that is, in accordance with procedures that are fair to the individual considered in the light of the statutory requirements, the interests of the individual and the interests and purposes, whether public or private, which the statute seeks to advance or protect or permits to be taken into account as legitimate considerations (cf. Salemi (No. 2), at p.451, per Jacobs J.).
An appropriate starting point is to consider the nature of the SSAT’s role and processes under the relevant legislation. However, it is important to note that ‘the rules of natural justice may vary from case to case even though the same power is being exercised’, depending upon the nature of the issues and events in a particular hearing: see National Companies and Securities Commission v News Corporation Limited [1984] HCA 29; (1984) 156 CLR 296 per Gibbs CJ at [19].
Nature of the Tribunal process
Part VIIA of the Child Support (Registration and Collection) Act 1988 provides for review of decisions of the Child Support Registrar by the SSAT. ‘In carrying out its functions under this Act, the Tribunal must pursue the objective of providing a mechanism of review that is fair, just, economical, informal and quick’: see s.88.
A person may apply to the Tribunal for review of a decision of the Child Support Registrar: s.94. The SSAT stands in the shoes of the decision maker it is reviewing. Thus, it must answer the same questions that were before the Objections Officer. As a result, it is not limited to the issues raised by the applicant for the review.
Once an application for review is made, the Child Support Registrar must forward to the Tribunal and the parties (save for limited exceptions) the following (see ss.96 and 97):
(a) a statement about the decision under review that:
(i)sets out the findings of fact made by the Registrar; and
(ii) refers to the evidence on which those findings were based; and
(iii) gives the reasons for the decision; and
(b) a copy of every document or part of a document that:
(i) is in the possession, or under the control, of the Registrar; and
(ii) is relevant to the review of the decision.
Section 103 contemplates the need for pre-hearing conferences to ensure that a proper and efficient hearing can be held, providing:
103. [Pre-hearing conferences] (1) The Tribunal Executive Director may convene one or more conferences with the parties to a review if he or she considers that it would assist in the conduct and consideration of the review to do so.
(2) At a conference, the Tribunal Executive Director may:
(a) fix a day or days for the hearing; and
(b) give directions about the time within which submissions are to be made to the Tribunal; and
(c) give directions about the time within which evidence is to be brought before the Tribunal.
The right to an oral hearing is specifically provided for in section 103A in the following terms:
103A. [Arrangements for hearings] (1) The Tribunal Executive Director must fix a day, time and place for the hearing of a review of a decision if:
(a) an application is made to the Tribunal for review of the decision; and
(b) the parties to the review do not reach an agreement before a hearing of the review is to begin; and
(c) the Tribunal Executive Director has not already done so at a pre-hearing conference.
(2) The Tribunal Executive Director must give the applicant and any other parties to the review written notice of the day, time and place fixed for the hearing of the application.
(3) The notice under subsection (2) must be given a reasonable time before the day fixed for the hearing.
Section 103R specifically provides for the adjournment of hearings. However, the hearing procedure is not closely proscribed in the Act, s.103M simply providing:
103N. [Hearing procedure] (1) The Tribunal, in reviewing a decision under this Part:
(a)is not bound by legal technicalities, legal forms or rules of evidence; and
(b)is to act as speedily as a proper consideration of the review allows; and
(c)in determining what a proper consideration of the review requires, must have regard to the objective laid down by section 88.
(2) The Tribunal may inform itself on any matter relevant to a review of a decision in any manner it considers appropriate.
The parties have a right to make submissions personally or by their representative: s.103C. The Tribunal may take evidence on oath for the purposes of the review: s.103G. The Tribunal has broad information gathering powers which allow for it to require persons to provide information, produce documents, or attend and answer questions: s.103K. Alternatively, it is open to the Tribunal to request that the Child Support Registrar obtain information: s.103L.
The powers of the Tribunal when reviewing a decision are set out in s.103S as:
103S. [Tribunal must affirm, vary or set aside decisions] If a person applies to the Tribunal for review of a decision under this Part, the Tribunal must:
(a)affirm the decision; or
(b)vary the decision; or
(c)set the decision aside and:
(i)substitute a new decision; or
(ii)send the matter back to the Registrar for reconsideration in accordance with any directions or recommendations of the Tribunal.
In the Explanatory Memorandum (at page 89), the reasons for establishing a system of review before the Tribunal were discussed:
… A parent who appeals to a court must bring their action against the other parent in an adversarial process. The child support legislation makes the carer and the liable parent, rather than the Child Support Registrar, parties to the appeal. This is perceived to be an unfair aspect of the child support system. The court process can be expensive and time consuming, as well as amplifying animosity between separated parents. Consequently, external review of the Registrar’s decisions is not often sought.
Schedule 3 introduces review by an independent external body, the Social Security Appeals Tribunal (SSAT), of child support decisions which have been reviewed under the Child Support Agency’s internal review procedure. The purpose of introducing this is to provide [an] external review mechanism which is faster, less formal and less expensive than court action, while still providing just and fair outcomes. The Registrar is the primary respondent to an application for appeal, although the other parent is also a party (with the exception of limited circumstances in which the outcome cannot affect the other parent). It is an inquisitorial, rather than an adversarial, process, which may assist in reducing tensions between separated parents when resolving child support issues.
The processes of the Tribunal are clearly intended to operate on an inquisitorial rather than adversarial model. This places the obligation of identifying the issues upon the Tribunal. Unlike a court, the Tribunal must make its own decisions as to what evidence to seek or gather to enable it to properly carry out its function, particularly in cases where it is not simply refusing an application, but making a change that affects the interests of a party.
The only right of review of a decision of the SSAT is an appeal ‘on a question of law’ to the courts: s.110B. In LDME & JMA (SSAT Appeal) [2007] FMCAfam 712 at [17] to [44], Halligan FM identifies many cases on the nature of an appeal on a question of law. Most significantly, such an appeal does not allow for a review on the merits. As a result, it is important for the Tribunal to provide appropriate reasons. This will usually entail careful findings of fact and clear explanations of the reasons for any decision, particularly where it involves the exercise of a discretion such as altering a child support amount.
The Full Court of the Family Court has considered the extent of reasons required in family law cases in a number of decisions. A leading authority in the family law jurisdiction is Merriman v Merriman [1993] FCA unrep603; (1993) FLC ¶92-422 where the Full Court said:
Following the decisions of the Full Court of this Court in Bennett and Bennett (1991) FLC ¶92-191, Horsley and Horsley (1991) FLC ¶92-205 and Bonnici and Bonnici (1992) FLC ¶92-272 the principles governing the need for the giving of adequate reasons for the exercise of the discretion ... are well established. For present purposes they are perhaps best expressed in the following passage from the judgment in Horsley (at page 78,401):
“Counsel for the wife contended that the trial Judge did not give adequate or any reasons for his decision and that his failure to do so amounted to an error of law and additionally contended that his Honour's discretion had miscarried. In Bennett and Bennett (1991) FLC ¶92-191 the Full Court considered a similar argument (also advanced in that case by the same counsel) and after referring to a number of authorities, ... referred to the judgment of the Full Court of the Supreme Court of Victoria in Sun Alliance Insurance Ltd. v. Massoud (1989) VR 8 and in particular to the passage in the principal judgment of Gray J. where his Honour said:
‘The adequacy of the reasons will depend upon the circumstances of the case. But the reasons will, in my opinion, be inadequate if:
(a) the appeal court is unable to ascertain the reasoning upon which the decision is based; or
(b) justice is not seen to have been done.
The two above stated criteria of inadequacy will frequently overlap. If the primary Judge does not sufficiently disclose his or her reasoning, the appeal court is denied the opportunity to detect error and the losing party is denied knowledge of why his or her case was rejected.'
In Bennett's case the Full Court went on to say:
‘It is unnecessary to decide, in this case, whether the inadequacy of her Honour's reasons was itself an error of law requiring her decision to be set aside, in that we have already determined that the appeal should succeed on the merits. The weight of judicial authority, however, suggests that it might well amount to such an error. At the very least the failure to give adequate reasons places a duty on an appellate court to scrutinise the decision with particular care.
In the absence of adequate reasons, the Full Court is not obliged to uphold a judgment merely because the result may be said to fall within the wide ambit of the Judge's discretion. In general, the appellate Court should be able to discern either expressly or by implication the path by which the result has been reached.'
The Court concluded on this topic:
‘The important thing is that the appellate court must be placed in the position of being able to follow the trial Judge's line of reasoning, as must the parties, if they are to be satisfied that justice has been done.
That these principles also apply to child support decisions is without doubt: see Johnson & Johnson [1998] FamCA 1519; (1999) FLC ¶98-004.
Whether a failure to provide adequate reasons is, of itself, sufficient to show an error of law is a question that need not be decided today, however it is clear that inadequate reasons may warrant ‘an inference that the tribunal has failed in some respect to exercise its powers according to law’: Repatriation Commission v O'Brien [1985] HCA 10; (1985) 155 CLR 422 at [15] per Brennan J.
It also important to note that whilst the Explanatory Memorandum indicates that the SSAT process is to reduce the adversarial nature of the proceedings, nonetheless the decision the SSAT must make is generally one between competing parties where any gain to one will represent a corresponding loss to the other. In this sense, the process is different to that of tribunals such as the Refugee Review Tribunal and Migration Review Tribunal: for example, see the discussion of Hayne J in Muin v Refugee Review Tribunal [2002] HCA 30 at [266]. As such, some care may be needed in applying cases relating to other tribunals, or even other areas of the jurisdiction of the SSAT.
Was the appellant given fair notice of the issues?
On the face of the decision of the SSAT, it appears that the SSAT did not consider that the rate of child support for the period before 15 January 2007 was an issue before the Tribunal. Whilst the statement of the Tribunal is strong evidence of the issues being considered, I bear in mind the comments of the High Court in Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 that:
[31] … the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed.
The Tribunal is required to operate informally: s.88 of the Child Support (Registration and Collection) Act 1988. It is appropriate in these circumstances to look at the material and hearing process to determine if the appellant had sufficient notice of this issue for there to have been procedural fairness.
There is no doubt that the appellant knew of the claims of the mother before the Objections Officer. In the ordinary course, the issues and claims would be apparent to a party before the Tribunal as a result of the proceedings before the Objections Officer. In this case, however, the mother had ceased to participate in the proceedings. The children were no longer living with her. She did not appear to be actively pursuing any claim. The Tribunal had written to the appellant before the hearing telling him only that ‘[the mother] has been removed as a party to the appeal … The appeal will proceed without the party that has been removed.’
The Child Support Registrar did not appear before the Tribunal or pursue any claim or argue for any particular outcome even though the Registrar was a party (see s.101), and was expected to be the ‘primary respondent’ in the process (see Explanatory Memorandum as quoted above at paragraph [36]).
It was open to the Tribunal to make a decision adverse to the appellant: see ss.87 and 103T(1) of the Child Support (Registration and Collection) Act 1988, s.98S(2) of the Child Support (Assessment) Act 1989 and Garnaut v Child Support Registrar [2004] FCA 1100 at [49] to [59]. Whilst decisions adverse to the applicant or appellant are open in many contexts, it is incumbent upon a tribunal or court to ensure that the parties affected are aware the tribunal is considering issues beyond those on which the parties have conducted the case. There are many examples of the application of this principle, including Neal v R [1982] HCA 55; (1982) 149 CLR 305; Kioa v West [1985] HCA 81; (1985) 159 CLR 550; Commissioner for the Australian Capital Territory Revenue v Alphaone Pty Ltd [1994] FCA unrep6805; (1994) 49 FCR 576; Seltsam Pty Limited v Ghaleb [2005] NSWCA 208 at [78]; Edwards & Edwards [2006] FamCA 1230; ; (2006) FLC ¶93-306 and Dieter & Dieter [2007] FamCA 608.
In a letter notifying the appellant of the hearing time, the Tribunal said that ‘[t]he decision can occasionally result in a more adverse outcome than the CSA decision.’ The Presiding member of the Tribunal, when making introductory remarks at the hearing said:
We say to all of our applicants and the other people who come to – the other parties, the decision that we make, it may well be adverse, it may be that applicants or other parties who come to this Tribunal may be worse off.
…
Having said that, we haven’t made our minds up because we need to get information from you. But we say that to everyone, just so that – and I think that’s in our documents as well.
At pages 23 to 24 of the transcript of the hearing, the Tribunal asks the appellant about his decision to take unpaid sick leave, and he gives his explanation of the reasons for that (relating to his poor asset base and need to manage his sick leave as he is likely to be in poor health in the future).
The appellant proceeded on the basis that the only issue before the Tribunal was his complaint about the Objection Officer’s decision. That the Tribunal was considering allowing the mother’s claim before the Objection Officer with respect to an earlier period was never put to the appellant.
The issues before the Tribunal would usually be those before the Objections Officer. In a case where the tribunal is considering allowing a claim by a party that has since ceased pursuing the claim, it is reasonable for the other party to assume that that issue is abandoned and no longer needs to be addressed. In this case, the appellant did not have notice that the Tribunal was considering making findings in accord with the claims of the mother, even though she had ceased to pursue the proceedings.
In these circumstances, it is incumbent upon the Tribunal to put the appellant on notice if the Tribunal is still considering making findings in accordance with the claims of the party that has ceased to pursue their claims. Merely making the abstract statement that an adverse decision can be made, without articulating the issue in the context of this particular dispute, was not sufficient to give the unrepresented applicant in the case notice in a way that ensured he would understand that those claims were live issues before the Tribunal.
The Full Court of the Family Court identified guidelines in Re F: Litigants in Person Guidelines [2001] FamCA 348; (2001) FLC ¶93-072 for dealing with litigants in person, including that:
8. A judge should attempt to clarify the substance of the submissions of the litigant in person, especially in cases where, because of garrulous or misconceived advocacy, the substantive issues are either ignored, given little attention or obfuscated. (Neil v Nott (1994) 121 ALR 148 at 150);
9. Where the interests of justice and the circumstances of the case require it, a judge may:
•draw attention to the law applied by the Court in determining issues before it;
•question witnesses;
•identify applications or submissions which ought to be put to the Court;
•suggest procedural steps that may be taken by a party;
•clarify the particulars of the orders sought by a litigant in person or the bases for such orders.
These comments are particularly apt here, having regard to the role of the Tribunal as an inquisitorial tribunal that is exercising a broad discretion and is the final arbiter of factual disputes.
This case highlights the problems of informal processes when dealing with complex and changing factual scenarios coupled with an unrepresented party and a party who is not participating. Such cases require particular care to ensure that parties are on clear notice of the issues so that they have a real opportunity to be heard. The nature of the case and conduct of the parties here presented the Tribunal with a difficult task. However, in the circumstances of this case, I find that the appellant has not been accorded procedural fairness with respect to the periods before 15 January 2007. For this reason the decision of the Tribunal should be set aside.
The ability to subpoena or cross-examine parties or witnesses
The legislative provisions provide no specific right to parties to proceedings before the Tribunal to cross-examination or to subpoena witnesses. The Tribunal could adopt a process that provided for cross-examination, and indeed the parties could request the Tribunal to require reluctant witnesses to attend for questioning. However, it is entirely consistent with the legislation that the Tribunal would not necessarily have to adopt such a process: the Tribunal has considerable latitude to adopt a process suitable to the issues and circumstances of the particular matter before the Tribunal.
In this case, no specific request was made to the Tribunal to require a particular witness to be made available, nor to have an opportunity to cross-examine a person. I do not accept that in the context of this case the Tribunal was required to make offers to subpoena witnesses or make persons available for cross-examination.
Opportunity to answer material submitted to and findings of the Tribunal
The appellant complains that he was denied an opportunity to address matters with which he disagrees. The appellant was sent a copy of the material before the Tribunal. At the hearing, he was given an appropriate opportunity to express his concerns or criticisms of matters set out in the material. There is nothing to suggest that the Tribunal referred to or relied upon material that the appellant had not seen before the hearing.
The appellant’s submissions in this regard go beyond seeking a fair opportunity to put his case to seeking an opportunity to criticise the findings of the Tribunal before it delivers its decision. As the Full Court said in Commissioner for the Australian Capital Territory Revenue v Alphaone Pty Ltd [1994] FCA unrep6805; (1994) 49 FCR 576:
28. It is a fundamental principle that where the rules of procedural fairness apply to a decision-making process, the party liable to be directly affected by the decision is to be given the opportunity of being heard. That would ordinarily require the party affected to be given the opportunity of ascertaining the relevant issues and to be informed of the nature and content of adverse material - Dixon v. Commonwealth (1981) 61 ALR 173 at 179. However, as Lord Diplock said in F Hoffman-La Roche and Co. A.G. v. Secretary of State for Trade and Industry [1975] AC 295 at 369:
"... the rules of natural justice do not require the decision maker to disclose what he is minded to decide so that the parties may have a further opportunity of criticising his mental processes before he reaches a final decision. If that were a rule of natural justice only the most talkative of judges would satisfy it and trial by jury would be abolished."
The appellant, in his affidavit of 8 June 2007, lists a number of matters that are claimed to be factual errors in the decision of the Tribunal. Most of the list are differences in emphasis or impression, or minor and inconsequential errors.
To the extent that the Tribunal dealt with a period before 15 January 2007, the appellant had the material the Tribunal relied upon, but was not aware that the Tribunal was considering this period. Thus, whilst he could have commented upon this material at the hearing, he was not aware that it was relevant to the issues.
Whether the Tribunal should have sought further information
At the conclusion of the hearing, the Tribunal indicated to the appellant that it would make further enquiries before making a decision. Ultimately, the Tribunal made a decision without making any further enquiries.
It is for the Tribunal to determine whether to make further enquiries. If, on reviewing the material, the Tribunal concludes that it has sufficient evidence to discharge its functions then it may proceed to a decision. A statement by the Tribunal that it wishes to or intends to make further enquiries does not bind the Tribunal. In some cases, it may be unfair not to make the enquiries; for example, where a party relies upon such a representation and does not provide that evidence themselves. However, that is not the circumstances of this case.
In this case, the appellant has not shown that the Tribunal changing its mind about whether to make further enquiries resulted in any procedural unfairness.
Ground (b) - Bias and bad faith
At the hearing, the appellant explained that his claim of bias and bad faith was put in the sense that the word bias is used in statistical sampling, not in the sense the terms are used in administrative law. This is not a basis upon which an appeal can be allowed. The appellant’s complaints as to the administration of the Child Support Agency and SSAT in this regard are more appropriately addressed to the heads of those administrative bodies, the relevant Minister or the Ombudsman.
Ground (c) – Findings without evidence
Counsel for the Child Support Registrar carefully identified the evidentiary foundations for the factual findings of the Tribunal. The appellant was not able to identify any particular finding for which there was no evidence available to the Tribunal.
Ground (d) – Failure to take relevant considerations into account
The appellant’s main complaint with respect to this ground was that the Tribunal failed to have regard to the events that occurred in the period leading up to the decision of FM Mowbray. It is difficult to see the relevance of this material in the context of the current application. It relates to an earlier period and different circumstances.
More significantly, the Tribunal does not appear to have considered the actual financial circumstances of each party at present, nor the costs of the children. There is no consideration of whether the appellant can meet the retrospective order, when he meets the full costs of the children at present. There is no examination of the mother’s current financial position.
Sub-sections 117(4) to (9) contain a lengthy list of considerations relevant to determining whether any particular decision is ‘just and equitable’ or ‘otherwise proper’ providing:
(4) In 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 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
(b) the proper needs of the child; and
(c) the income, earning capacity, property and financial resources of the child; and
(d) the income, property and financial resources of each parent who is a party to the proceeding; and
(da) the earning capacity of each parent who is a party to the proceeding; and
(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; and
(f)the direct and indirect costs incurred by the carer entitled to child support in providing care for the child; and
(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.
(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.
Proper needs of the child
(6) In having regard to the proper needs of the child, the court must have regard to:
(a)the manner in which the child is being, and in which the parents expected the child to be, cared for, educated or trained; and
(b) any special needs of the child.
Income, earning capacity, property and financial resources
(7) In having regard to the income, earning capacity, property and financial resources of the child, the court must:
(a)have regard to the capacity of the child to earn or derive income, including any assets of, under the control of, or held for the benefit of, the child that do not produce, but are capable of producing, income; and
(b) disregard:
(i)the income, earning capacity, property and financial resources of any person who does not have a duty to maintain the child, or who has such a duty but is not a party to the proceeding, unless, in the special circumstances of the case, the court considers that it is appropriate to have regard to them; and
(ii)any entitlement of the child or the carer entitled to child support to an income tested pension, allowance or benefit.
(7A) In having regard to the income, property and financial resources of a parent of the child, the court must:
(a)have regard to the capacity of the parent to derive income, including any assets of, under the control of, or held for the benefit of, the parent that do not produce, but are capable of producing, income; and
(b) disregard:
(i)the income, earning capacity, property and financial resources of any person who does not have a duty to maintain the child, or who has such a duty but is not a party to the proceeding, unless, in the special circumstances of the case, the court considers that it is appropriate to have regard to them; and
(ii)any entitlement of the child or the carer entitled to child support to an income tested pension, allowance or benefit.
(7B) In having regard to the earning capacity of a parent of the child, the court may determine that the parent's earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied that:
(a) one or more of the following applies:
(i)the parent does not work despite ample opportunity to do so;
(ii)the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full-time work for the occupation or industry in which the parent is employed or otherwise engaged;
(iii)the parent has changed his or her occupation, industry or working pattern; and
(b)the parent's decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:
(i)the parent's caring responsibilities; or
(ii)the parent's state of health; and
(c)the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.
Direct and indirect costs in providing care
(8) In having regard to the direct and indirect costs incurred by the carer entitled to child support in providing care for the child, the court must have regard to the income and earning capacity foregone by the carer entitled to child support in providing that care.
Subsections not to limit consideration of other matters
(9) Subsections (4) to (8) (inclusive) do not limit other matters to which the court may have regard.
The Full Court in Hallinan v Witynski [1999] FamCA 1127; (1999) FLC ¶98-009 described the minimum necessary findings with respect to the matters listed in s.117(4) and (5) as:
90. … the reasons for answering the two questions posed by s 117(1)(b)(ii) need not be elaborate, but the task of considering, at least broadly, the matters referred to in s 117(4) and 117(5), respectively, and then making a finding as to satisfaction or otherwise in relation to the relevant matters, must be undertaken as a necessary part of the exercise of discretion imposed on the Court by s 117(1).
In Ross & McDermott [1998] FamCA 134; (1998) FLC ¶98-003 the Full Court noted that:
39. In our view a practical and flexible approach should be adopted to the task of considering these ss.117(4) and (5) matters, that is an approach similar to that which this court has long adopted to the "s.68F(2) matters" (formerly the "s.64 matters") in child-related proceedings under the Family Law Act 1975 , and to the "s.79(4) matters" and "s.75(2) matters" in property settlement proceedings under that Act. Accordingly, we consider it is unnecessary to make any reference to those ss.117(4) and (5) matters which have no real relevance in the circumstances of the particular case. We also consider that it would be permissible to group together and consider as a whole, those relevant matters which by their nature lend themselves to such an approach in the circumstances of the particular case, and in the case of those matters which are required to be considered under more than one sub-section of s.117, to examine such matters only once, although they may need to be taken into account under more than one sub-section.
However, the Full Court in Ross & McDermott went on to consider the circumstances of the judgement in that case, saying:
45. However, it is his Honour's limited consideration of the husband's financial circumstances and also his failure to weigh the hardship that the making of or refusal to make an order varying the amount of child support would cause to the wife and child on the one hand and the husband on the other, which causes us concern.
46. It is true that in his discussion of whether or not there were "special circumstances" in this case, his Honour referred to the equity which the husband had in his home and to the amount of income which the husband received. It is also true that after referring to the duty which a parent has to maintain his or her child, his Honour concluded that the husband had no commitment to support any other person (notwithstanding the fact that the husband had formed a new relationship).
47. But at no point did his Honour consider the level of the husband's own expenses and what actual capacity he had to contribute out of his income to the support of his child. Rather, as we discussed in connection with the first matters raised in the appeal, what his Honour appears to have done, having determined the husband's taxable income, was to go straight to the amount payable on that income according to the formula which is used for the administrative assessment of child support. While his Honour was entitled to have some regard to the operation of the formula as a convenient guide in his determination of the new child support liability, he was not, having determined the husband's income, entitled then to go straight to the formula, and to do so without regard to the husband's expenses or liabilities, or without regard to the relative hardship which such a variation would cause to each party and to the child.
48. Had his Honour considered and made findings with respect to these matters of the husband's expenses and of the relative hardship to the parties and to the child if the amount of child support was reduced, it might have been possible for us either to infer that his Honour had concluded that it was just and equitable and otherwise proper to make the orders which he did, or on a re-exercise of the discretion, to reach our own conclusion about these matters.
49. However, in the absence of findings by his Honour about these important matters and also because of his Honour's error in relation to his finding of "special circumstances", we consider that we must allow the appeal and remit the matter for re-hearing.
Such criticisms also apply to the decision of the Tribunal in the present case.
A further relevant consideration in this case was the present circumstances of the appellant and the children, given that the appellant is now meeting almost all of the costs of caring for the children. Indeed, one of the appellant’s main complaints was that the Tribunal failed to deal with the matter ‘holistically’, by which he meant considering the whole of the history of support provided by each parent for the children. In Hides v Hatton [1997] FCA unrep1098; (1997) FLC ¶92-759, the Full Court pointed out that a failure to quantify the amount of arrears that an order may create indicated a failure to consider the practical effect of the orders. In Hides’ case the Full Court went on to say:
It should be clear from what we have said in discussing both the issues of the range of departure applications which were before the trial Judge and also the retrospective operation of departure orders, that the task of a trial Judge in making a departure order from an assessment for a past child support year, has, or at least can have, a dual dimension. By this we mean that not only must the Judge apply the three stage process under s 117(2), (4) and (5) in relation to the circumstances of the parties as they existed in the child support year in question, but also in relation to the present circumstances of the parties (if at all relevant). For example, it may well be necessary in a particular case in addition to considering the circumstances of the parties in the past child support year in question, also to consider the present capacity of the payer to meet a new assessment, and/or the impact on a payee of any credit in the payer's favour which might be created by a departure from an assessment for an earlier child support year.
Had the appellant been aware that a retrospective departure was being pursued, a failure or refusal on his part to place material before the tribunal about many of the considerations referred to here may have allowed the Tribunal to draw an inference that the material would not have shown the decision was unjust or inequitable. Whilst it is not uncommon for courts to draw such an inference in adversarial proceedings, it must also be remembered that in adversarial proceedings it is for the parties to place the appropriate material before the court, unlike an inquisitorial model where it is for the Tribunal to identify the issues and gather such evidence as it may need to make an appropriate decision. In any event, such an inference was not drawn by the Tribunal as the Tribunal does not appear to have considered the relevant factors.
There is nothing in the decision to show that the Tribunal took into account many of the relevant considerations under s.117(4). As the Tribunal were increasing the assessment of the appellant it needed to consider these matters before it could be satisfied that the change proposed would be ‘just and equitable’. For this reason the appeal should be allowed.
I have considered the suggestion that the Tribunal’s reference to the children leaving the mother’s household because of a lack of child support indicates that there was an element of ‘compensation’ in the reasoning process of the Tribunal. Issues relating to decisions about why the children reside with one parent or the other will generally not be relevant to the determination of child support. In this case, the children had not returned to shared care despite the determination of the Objections Officer, a factor militating against the mother’s claim and demonstrating the difficulties in pursuing such issues. If the Tribunal’s reference to this issue indicated a consideration sounding in ‘compensation’ for changes in care arrangements, this would be a serious error as it is not a factor that is relevant under the legislation: see, for example, Beck and Beck (No2) (1983) FLC ¶91-318 and CCD & AGMD [2006] FamCA 1291; (2006) FLC ¶93-300 with respect to the analogy of importing notions of ‘compensation’ in spousal maintenance and property proceedings. However, considering the actual terms of the paragraph of the reasons, I am not persuaded that the Tribunal was referring to the changes in care for this purpose, but rather to draw the inference that the mother needed financial support when the children were in her care. An analysis of her actual income and expenses at the relevant time may have provided a clearer understanding of the extent of her financial needs.
The Appellant’s Sick Leave Entitlements
The central complaint of the appellant in this case was that the Objection Officer took account of his entitlements to paid sick leave when determining his child support income amount. This central complaint became lost the myriad of grounds the appellant pursued with regard to the decision of the Tribunal to create a retrospective liability. However, it is appropriate that I deal with the issue that was the reason for the application to the SSAT.
Section 117(2)(c) of the Child Support (Assessment) Act 1989 provides for a ground for departure as follows:
(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:
(i)because of the income, earning capacity, property and financial resources of the child; or
(ia)because of the income, property and financial resources of either parent; or
(ib)because of the earning capacity of either parent; or
…
There can be no doubt that paid sick leave entitlements are a financial resource, and in some circumstances may amount to property: see generally Gould & Gould [1996] FamCA unrep945; (1996) FLC
¶92-657 and Tomasetti & Tomasetti [2000] FamCA 314; (2000) FLC ¶93-023, where long service and recreational leave entitlements are discussed in the context of property cases.
The purpose of sick leave is to ensure that employees continue to have an income during periods of illness so as to be able to support themselves and their families. In a case, such as the present, it does not appear to me to be arguable that the appellant’s sick leave entitlements would not be prima facie ‘special circumstance’ under s.117(2)(c), where he had a nil assessment as a result of taking unpaid sick leave. The paid sick leave entitlements are clearly a significant financial resource that was available to him during his period of ill health, from which he could provide financial support for the children.
The real question in this case is whether it would be ‘just and equitable’ to retrospectively assess the appellant on the basis that he could access that paid sick leave, having regard to the circumstances existing at the time and the present circumstances. In particular, the financial position of both parties, the reasonable needs of the children, and the extent to which they are meeting those needs will always be central to the exercise of the discretion.
The formula proves an easy method of determining an appropriate rate of child support in the vast majority of cases. Whilst adjustments that maintain the integrity of the formula provide a guide to the legislatively fixed standard (a relevant consideration under s.117(4)(a)), this does not necessarily show that a particular departure is ‘just and equitable’ and ‘otherwise proper’. In order to determine whether to make a decision departing from an assessment, a finding must be made that the particular alteration is ‘just and equitable’ and ‘otherwise proper’ having regard to the relevant matters set out in s.117(5) to (9). The brevity with which Senior Case Officers or Objection Officers commonly approach this part of their tasks (as first instance decision makers subject to a full merits review) will rarely be appropriate for the SSAT in its role as an independent inquisitorial tribunal that is the final arbiter of the facts.
Whilst the factors discussed by the Tribunal weigh in favour of the decision they made, without undertaking a proper determination of all of the relevant s.117(4) factors it is not possible to determine whether the decision of the Objection Officer or the Tribunal is the appropriate one with respect to the appellant’s past child support assessment.
Conclusions
Pursuant to s.110F of the Child Support (Registration and Collection) Act 1988, I have the power to make such order as I think appropriate, including:
110F [Powers of courts] …(2)…
(a)an order affirming or setting aside the decision of the SSAT; or
(b)an order remitting the case to be heard and decided again, either with or without the hearing of further evidence, by the SSAT in accordance with the directions of the court.
At the hearing the appellant sought orders departing from the child support assessment. Those orders were not articulated in his material. The mother did not participate in the hearing process and had no notice that this hearing would go beyond setting aside the decision of the SSAT. In the circumstances, the mother would be denied procedural fairness were I to make orders beyond setting aside the SSAT decision.
I therefore make orders setting aside the decision of the SSAT and remitting the case to the SSAT to hear and determine according to law.
I certify that the preceding eighty-seven (87) paragraphs are a true copy of the reasons for judgment of Riethmuller FM
Legal Associate: Robin Smith
Date: 15 October 2007
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