Re Warne and Secretary, Department of Family, Community Services and Indigenous Affairs and Anor
[2006] AATA 159
•24 February 2006
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2006] AATA 159
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2005/327
GENERAL ADMINISTRATIVE DIVISION ) Re KASIA WARNE Applicant
And
SECRETARY, DEPARTMENT OF FAMILY, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
Respondent
And GEOFFREY WARNE Third Party
DECISION
Tribunal Deputy President P E Hack SC Date24 February 2006
PlaceBrisbane
Decision In accordance with section 43 of the Administrative Appeals Tribunal Act the Tribunal:
1. Sets aside the decision under review;
2. Remits the matter to the Respondent with directions to adjust the FTB payments such that:
(a) for the period 22 September 2003 to 4 November 2003 FTB be calculated on the basis that Mrs Warne solely had care of the children Taylah Warne and Kyle Warne;
(b) subject to paragraph (a) the FTB for the period from 2 May 2003 to 23 November 2004 be determined on the basis that Mrs Warne had care of the children for 74% of the time and Mr Warne for 26% of the time.
....................Signed..........................
Deputy President
CATCHWORDS
SOCIAL SECURITY – family tax benefit – shared care of children
A New Tax System (Family Assistance) Act 1999 ss 22, 59
Re Nowicz and Secretary, Department of Family and Community Services (2001) 33 AAR 337
Re Feeney and Secretary, Department of Family and Community Services and Fitzsimmons [2005] AATA 818
REASONS FOR DECISION
24 February 2006 Deputy President P E Hack SC 1.Mrs Kasia Warne and Mr Geoffrey Warne are the parents of two children, Taylah, born on 21 September 1993 and Kyle, born on 26 January 1996. Mr and Mrs Warne were married to each other but are now divorced. The children each answer the description of an “FTB child” as that rather soulless expression is used in the A New Tax System (Family Assistance) Act 1999 (the Act).
2.Because Mrs Warne and Mr Warne shared the care of their children in the period between 2 May 2003 and 23 November 2004, a period that I shall describe as the relevant period, they were each entitled to receive Family Tax Benefit (FTB) for the relevant period to the extent to which they each had the care of the children.
3.On 26 November 2004 Centrelink determined that in the relevant period Mrs Warne had the shared care of the children for 58% of the time (and thus was entitled to 58% of the FBT) and Mr Warne for 42% (with the equivalent entitlement to FBT). That decision was affirmed on internal review on 10 January 2005 and, on Mrs Warne’s application to which Mr Warne was a party, by the Social Security Appeal Tribunal on 9 May 2005.
4.Mrs Warne seeks a review of that decision by this Tribunal. She contends that the decision is wrong and that her percentage ought to be increased. Mrs Warne’s application was lodged in the Tribunal on 27 May 2005. Mr Warne is a party to this application. He also contends that the decision is wrong but he says that his percentage ought to be increased. The Secretary, appeared by Ms Oliver, a departmental advocate, to support the decision and, if I may say so, did so quite properly in a helpful, rather than strictly adversarial, way.
5.I start by making two preliminary observations which are not germane to the ultimate decision. The first is that it seems to me to be odd, at least, that Mrs Warne was granted Legal Aid for the proceedings but that Mr Warne was not, despite him having apparently satisfied the means test and the merits test for Legal Aid. Obviously the absence of Legal Aid to Mr Warne does not touch upon questions that I have to decide and I am satisfied that Mr Warne has, despite the disadvantage of not being represented, advanced the best case available to him. But Mr Warne has a justifiable sense of grievance with what appears on its face to be an odd decision by the Legal Aid Office.
6.The other matter about which I make a comment is that in the present case, as in, I assume, many cases involving the break down of family relationships, the various witnesses have in some instances let their emotions get the better of them and have made quite insulting attacks on the opposing party. As I trust I made clear to the parties during the course of the hearing, I have neither the need nor the inclination to reach any judgement about the parenting skills or other attributes of the parties to these proceedings. My task is simply to decide, on the evidence presented by the parties, the extent to which Mrs Warne and Mr Warne each contributed to the care of the children during the relevant period.
7.I should also add that I am not now concerned with any issue regarding a debt owed by Mrs Warne to the Commonwealth as a result of her having been paid FTB during the relevant period. I assume it to be the case that if she has been paid FTB on the basis of sole care and there is found to be shared care, that there is likely to have been an overpayment. But that issue was not before the Social Security Appeals Tribunal and I am not dealing with the issues that ordinarily arise in such cases.
the legislation
8.Part 3 of the Act deals with eligibility for FTB. No issue arises in the present case regarding eligibility and it may be disregarded. The starting point in this case is s 22(7). It provides that if the Secretary is satisfied that there has been, or will be, a pattern of care for a child over a period where a child will, by reference to the definitions of FTB child, be an FTB child of more than one individual, and one of those individuals makes a claim for payment of FTB for that child for some or all of the period, the child is taken to be the FTB child of that individual “on each day in that period, whether or not the child was in that individual’s care on that day”.
9.By virtue of s 59, where the Secretary is satisfied that an FTB child is an FTB child of “person A” and another individual, the Secretary is to determine the percentage that is to be person A’s percentage of FTB. For these purposes the Secretary has adopted a Family Assistance Guide (the Guide) that sets out the way in which the Secretary undertakes the task of determining the percentages of shared care. In my view the policy set out in the Guide provides an appropriate mechanism for the Secretary (and the Tribunal) to undertake the task of making a shared care determination and I propose to have regard to its terms.
10.Paragraph 2.1.1.45 of the Guide is headed “Shared Care & Establishing a Pattern of Care”. It commences,
“If the care percentages or care arrangements are not agreed on between the carers, it is necessary to establish a pattern of care … to make a shared care determination for FTB. A pattern of care is established by using either the number of nights in care … or hours of care for each FTB child. The percentage of care for each FTB child is then calculated and applied to the standard rate … of FTB …”
11.Paragraph 2.1.1.45 speaks of making a shared care determination by reference to the actual care arrangements as agreed to by the parties or, where there is no agreement, by reference to available evidence. The Guide suggests as a primary reference point a “nights in care” assessment, that is, a person having the overnight care of a child is regarded as having had care of that child for that day. But it recognises that there will be occasions where such an approach will not accurately reflect the caring arrangements for the child and suggests, in such cases, an “actual hours in care” approach.
12.Paragraph 2.1.1.50 deals with the calculation of an appropriate percentage. Step 1, it is suggested, is to establish a pattern of care, Step 2 is to work out the percentage of care, Step 3 is to round the percentage of care and Step 4 involves calculating the rate.
the evidence
13.The parties called a number of witnesses. It seems fair to say that none of them could be regarded as particularly accurate. The matters that were the subject of the evidence were matters that were, at the time, of no particular moment to the witnesses. They were not matters that one might ordinarily expect a witness to have a particular reason for recalling. I do not suggest that any of the witnesses was deliberately dishonest, rather, as it seemed to me, the witnesses ought generally be regarded as giving evidence of an impression, for example, an impression that Mr Warne often saw the children at Mrs Warne’s residence.
14.Mrs Warne was, I consider, generally reliable in her evidence despite one instance where that evidence was demonstrably wrong. She accepted, as did Mr Warne, that generally Mr Warne had care of the children,
·On Wednesdays when he collected them in the late afternoon and took them to before school care the following morning;
·On weekends when he collected them late on Saturday afternoon and took to before school care on Monday mornings.
15.There were, no doubt, occasional variations to this pattern and instances when Mr Warne had greater or lesser access, but I am satisfied on the evidence that this was the settled pattern during the balance of the relevant period.
16.Mrs Warne relies upon two matters in particular that she says impinges upon the pattern of care. First she says that there were many occasions when either Mr Warne was at her residence when he had care of the children or she was at Mr Warne’s residence at a time when they were in his care. Next she says that there were many instances where Mr Warne did not have care of the children on “his” days.
17.I regard it as probable that there were instances were Mr Warne had care in terms of the settled pattern whilst at Mrs Warne’s residence or whilst Mrs Warne was at his residence. And it is probable that there were occasions when by reason of illness or some other cause the settled pattern was not followed. But in my view neither of these instances warrant any adjustment to what I regard as an overall pattern. They were, in the context of that pattern, of minor significance. My impression from the evidence of the witnesses, particularly Mr and Mrs Warne, is that despite their own marital difficulties they acted cooperatively when it came to looking after the children. They are to be commended for this, but it does not warrant any adjustment to an overall pattern of care.
18.There were a number of witnesses called for Mrs Warne but ultimately I do not consider that their evidence did anything other than confirm my impression of the pattern of overall care.
19.Mrs Warne relied upon an inequality in the level of expenditure for the children as between her and Mr Warne. Her evidence in this regard was not challenged nor did Mr Warne seek to call any evidence that would contradict it. I accept as a fact that it was Mrs Warne who had primary responsibility for meeting the expenses of the children – school costs, medical costs, dental costs and such like. I accept as well that there were instances were Mr Warne paid costs that may have arisen on a day when the children were in his care but primarily I find these expenses were born by Mrs Warne. I will consider below the effect to be given to this conclusion.
20.Mr Warne, with the assistance at least of his father, prepared a number of documents that set out the case as he saw it. It is appropriate to start with exhibit 10. That is a calendar prepared by Mr Warne which purports to show each occasion when the children were in his care. The document has been prepared by reference, not to reality but instead to the terms of an order made in the Magistrates Court at Southport on 2 May 2003. Exhibit 10, as Mr Warne himself accepted, attributed to him care of the children on every occasion that the court order contemplated and, as he was also prepared to accept even went beyond that. I find exhibit 10 entirely unhelpful as a basis for determining the pattern of care. Ultimately, as it seemed to me, Mr Warne accepted that the pattern of care was as I have set out above, that is Wednesday nights, Saturday nights and Sunday nights. Mr Warne did contend that there were a number of instances when he had care of the children on Friday night for the purposes of him participating in their sporting activity. I am unpersuaded of this and consider that to the extent to which it did occur it is a matter which would not warrant any adjustment to a settled level of care.
21.Mr Warne also sought to suggest that for a long period during the Christmas 2003 school holidays he had care of the children. I accept that he had care of the children at various times during the holidays and perhaps it was the case that he had care of them on days outside the accepted pattern but on balance I conclude that there was no significant departure in quantative terms from the settled pattern of care.
pattern of care
22.I am satisfied there was a pattern of shared care during the relevant period with one exception. That exception concerns the period from 22 September 2003 to 4 November 2003. During all of that period Mr Warne was overseas. On two weekends during that period he had made arrangements with friends to have the children for part of the weekend. I am, as well, satisfied that he kept in touch with the children by telephone during this period. But despite these matters I conclude that the children were not in his care during this part of the relevant period. Indeed, as it seems to me, the children were not FTB children of Mr Warne during the period that he was overseas.
23.Accordingly there will need to be a recalculation of FTB for the period from 22 September 2003 to 4 November 2003. That recalculation will be on the basis that Mrs Warne had 100% of care of the two children during that period.
24.I turn then to the balance of the relevant period noting, at the outset, that I was not invited, nor do I regard it as warranted, to draw any distinction between the two children.
25.In approaching the task of determining the pattern of care I have considered the matter with a broad brush. The Guide, rightly in my view, accepts that no adjustment to FTB is warranted for minor variations in care arrangements. Consistently with that approach I do not propose to make any adjustment for the occasions when Mrs Warne was present whilst Mr Warne had primary care of the children nor do I propose to make any adjustment for the likely number of occasions there were variations as between the parties to suit the convenience of one or the other. Approaching the matter in this way the pattern of care that I find is that Mr Warne had care of the children from 5pm on Wednesday evenings until 7am on Thursday mornings and from 5pm Saturday to 7am Monday. I stress that this is a pattern rather than something that accords precisely with the evidence given by the parties.
26.Were the matter then to be approached on the basis of nights in care, that seems to me to yield a result which is inequitable. It is I think preferable in a case such as this to have regard to hours in care. On my calculation Mr Warne had the children in his care for 52 hours of the week. That represents some 31% of the available time. Calculating the matter in this way means that Mrs Warne is attributed with the care of the children from the point of time after Mr Warne has left them at day care on Thursdays and Mondays. That seems to me to be the correct approach to take given that Mrs Warne had primary responsibility for making arrangements with schools and before school care givers.
27.It is at this point in the exercise where it appears to me to be appropriate to have regard to the greater financial responsibility that has been cast upon Mrs Warne by virtue of the shared care arrangements. Despite the misgivings that Senior Member Kiosoglous had with the Tribunal being concerned with patterns of expenditure in Re Nowicz and Secretary, Department of Family and Community Services (2001) 33 AAR 337 at 341 [16] subsequent decisions have regarded it as appropriate for the Tribunal to consider proportionality of FTB payments on the basis of financial as well as temporal factors: see Re Feeney and Secretary, Department of Family and Community Services and Fitzsimmons [2005] AATA 818 at [81]. It would be wrong, I think, to require the Secretary to undertake a minute examination and comparison of the expenditure of the parties on their children. Moreover it would in all likelihood certainly lead to greater disputation between the parties in an area where there is already sufficient disputation. But where, as I find to be the case here, there is a significant difference between the amounts expended by one party compared with the amounts expended by the other, an adjustment, again on a broad brush basis, seems to me to be plainly warranted. Here on the evidence Mrs Warne was expending on average $238.00 per month on the children’s medical and schooling needs. Over that period the evidence supports a finding that Mr Warne paid child support on an average of about $55.00 per month and I think likely he also paid occasional costs attributed with schooling.
28.The disproportion between these expenditures warrants, in my view, an adjustment of 5% in favour of Mrs Warne.
conclusions
29.It follows that in my view the shared care in the balance of the relevant period should be regarded as 74% on the part of Mrs Warne and 26% on the part of Mr Warne. Accordingly I will set aside the decision under review and remit the matter to the Secretary with directions to adjust the FTB payments such that,
(a) for the period 22 September 2003 to 4 November 2003 FTB be calculated on the basis that Mrs Warne solely had care of the children Taylah Warne and Kyle Warne;
(b) subject to paragraph (a) the FTB for the period from 2 May 2003 to 23 November 2004 be determined on the basis that Mrs Warne had care of the children for 74% of the time and Mr Warne for 26% of the time.
I certify that the 29 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC
Signed: ....................Signed......................................................
Robert Hayes, AssociateDates of Hearing 31 January 2006 and 10 February 2006
Date of Decision 24 February 2006
For the Applicant Ms R Wilkinson, Legal Aid QLD
For the Respondent Ms S Oliver, Departmental Advocate
The Third Party appeared in person
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