Rennell and Kidd (Child support)

[2019] AATA 1739

Rennell and Kidd (Child support) [2019] AATA 1739 (9 May 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/MC015805

APPLICANT:  Mr Rennell

OTHER PARTIES:  Child Support Registrar

Mrs Kidd

TRIBUNAL:Member F Hewson

DECISION DATE:  9 May 2019

DECISION:

The tribunal sets aside the decision under review and substitutes its decision that amounts totalling $1,126.37 are to be credited against Mr Rennel’s child support liability under section 71C of the Child Support (Registration and Collection) Act 1988.

CATCHWORDS

CHILD SUPPORT – non-agency payments – no mutual intention payments were in lieu of child support - prescribed payment for school books and uniforms - payment to be credited - decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

REASONS FOR DECISION

BACKGROUND

1. This application for review is about whether expenses incurred by Mr Rennell can be credited against his child support liability.

2. In July 2018 Mr Rennell applied to the Department of Human Services—Child Support (the Department) for expenses he incurred, for a combined amount of $6,340.34, to be credited against his child support liability. On 4 August 2018 a decision was made to refuse to credit the payments against the child support liability.

3. Mr Rennell lodged an objection to the decision to refuse to credit the non-agency payments and, on 16 October 2018, the objection was disallowed.

4. On 15 November 2018 Mr Rennell lodged an application for review by the Social Services and Child Support Division of the Administrative Appeals Tribunal (the Tribunal). The application was heard on 12 February 2019. Mr Rennell spoke to the Tribunal by conference telephone. Mrs Kidd did not attend the hearing. The Child Support Registrar did not attend the hearing. As well as the evidence of Mr Rennell the Tribunal also had regard to documents provided by the Department, a copy of which was given to the parties.

ISSUES

1. The relevant legislation in this case is in the Child Support (Registration and Collection) Act 1988 (the Act) and in the Child Support (Registration and Collection) Regulations 1988 (the Regulations).

2. When the Department registers a child support liability for collection the amounts payable become a debt due to the Commonwealth and are payable to the Child Support Registrar, pursuant to section 30 of the Act. In some circumstances payments made directly to a payee or to a third party may be credited against a child support liability that is registered for collection by the Department (sections 71, 71A and 71C of the Act). The Department refers to these credits as ‘non-agency payments’ or ‘prescribed non-agency payments’. Section 71D of the Act provides that the Registrar may refuse to credit an amount under sections 71, 71A or 71C if satisfied that in the circumstances of the case the amount should not be credited.

3. In this case, the Tribunal must determine:

   ·     whether Mr Rennell made the payments which he has asked to be credited against his child support liability;

   ·     whether the payments were made during a period when the maintenance liability was enforceable by the Department;

   ·     whether the payments are non-agency payments or prescribed non-agency payments;

   ·     whether both the payer and the payee intended that the payments were paid in complete or partial satisfaction of an amount under the maintenance liability;

   ·     whether the payments can be credited against Mr Rennell’s registered and enforceable maintenance liability; and

   ·     if the payments can be credited against Mr Rennell’s registered and enforceable maintenance liability, whether or not in the circumstances of this particular case, the amount ought to be credited.

CONSIDERATION

1. Section 71 of the Act concerns payments made to the payee. Section 71A concerns payments made to third parties. Both provisions require that the payment was made by the payer of a child support liability collectable by the Department and the payment was intended by both child support parties, at the time it was made, to be a payment in satisfaction of the child support liability.

2. Section 71D of the Act provides that the Registrar may refuse to credit an amount under sections 71, 71A or 71C if satisfied that in the circumstances of the case the amount should not be credited.

3. The documents provided by the Department show that the child support case was registered in September 2006 and has been enforceable by the Department from 14 November 2006. The evidence shows that the payments Mr Rennell is seeking to have credited against his child support liability were made after that date.

4. The Department’s records include copies of receipts provided by Mr Rennell in support of his application for the payments to be credited against the child support liability. The tribunal did not have the opportunity to speak to Mrs Kidd about the application. According to the Department’s records, it was not able to contact Mrs Kidd to discuss the payments. It decided to refuse to credit the payments on the basis that it was not satisfied that there was ‘mutual intention’ that the payments were in lieu of child support.

5. The payments Mr Rennell is seeking to have credited against his child support liability are set out in a spreadsheet which he submitted to the Department. Apart from a cash payment of [amount] Mr Rennell said he loaned to Mrs Kidd [in] 2015/16, the payments are for education (or education-related) expenses in the period January 2017 to July 2018. Mr Rennell submitted receipts in support of the application. Mr Rennell said he has little contact with Mrs Kidd and has no evidence that the payments were intended to be in lieu of child support. In relation to the school expenses, he said the children passed a list of requirements from the school onto the parents and there was verbal agreement that he would purchase the items. Similarly, he was asked to purchase school shoes. Mr Rennell said he has the school resource list for the current year, but not for the previous years. He said he would provide them after the hearing.

6. Mr Rennell said he had not submitted the claim for non-agency payments to the Department earlier, because he suffers from [an illness] and it took him a long time to get all the information together. In relation to the [amount] (of which [amount] is still owing), Mr Rennell said he has lost the written evidence of the payment. Mr Rennell said the Department did not consider each of the pathways for non-agency payments. He said prescribed payments had not been considered.

7. The tribunal discussed the individual expenses with Mr Rennell at the hearing. He said the payments to [Company 1] were for items on the resource lists issued by [School 1]. He agreed, however, that a payment to [Company 1] [in] July 2017 was for books for the [child], but not for his current year of study. They were [texts], so his son could read ahead. Mr Rennell said receipts for shoes were for shoes required for the children for school. A payment of [amount] was for the [child], to reduce the sound of the [instrument] he was learning at school. It was not an item required by the school. Mr Rennell said that various receipts for books, not from [Company 1], were for books which were not part of the curriculum, but were related to his sons’ interests (e.g. history). Mr Rennell said he has no evidence that a payment for his son’s mobile phone plan, which is an amount of [amount] a month, was intended to be in lieu of child support. He said all of his purchases from [a business] were related to his sons’ education, but he agreed some payments were for items which were not school requirements (e.g. flashcards and card boxes). Items from [a few companies]were for a home study. Mr Rennell said items from [a few other companies] were for a camp, which he agreed was not a school activity.

8. Following the hearing Mr Rennell submitted copies of the [School 1] resource lists for [years] and [years]. The documents were sent to Mrs Kidd and she was given an opportunity to respond to the additional evidence. No response was received.

9. The tribunal was satisfied that Mr Rennell made payments, during a period when the maintenance liability was enforceable by the Department, which he has asked to be credited against his child support liability.

10. There is no evidence in this case that the expenses incurred by Mr Rennell were intended by both him and Mrs Kidd to be in lieu of child support. The tribunal was satisfied, therefore, that the payments do not meet the requirements of sections 71 and 71A of the Act.

11. Section 71C provides for payments prescribed by regulation to be credited against the amount payable under a child support liability, up to a maximum of 30% of the amount payable. Unlike sections 71 and 71A, section 71C does not require that the payment be intended to satisfy an amount payable under the liability. Payments to which section 71C apply are set out in section 19 of the Regulations and, so far as is relevant in this case include:

    ·amounts payable for uniforms and books prescribed by a school for a child; and

    ·the payee’s share of amounts payable for rent or a security bond for the payee’s home.

12. In relation to the loan to Mrs Kidd of [amount], the tribunal was not persuaded that it can be credited under section 71C of the Act as there is no evidence of the loan or of its purpose. In relation to school books and uniforms, the tribunal was satisfied that the following amounts meet the requirements of section 71C:

Paid to:	Amount ($)	Date paid
[Company 1]	39.85	1 February 2017
[Company 1]	135.94	1 February 2017
[Company 1]	36.50	21 February 2017
[Company 2]	149.95	7 June 2017
[Company 1]	19.99	2 February 2018
[Company 3]	184.90	24 January 2018
[Company 1]	419.33	24 January 2018
[Company 1]	27.95	2 March 2018
[Company 2]	111.96	24 January 2018
1,126.37

1. In relation to all of the other payments, while the tribunal accepted they were made in relation to the children’s education, in a broad sense, they were either not items required by the school, or they were not for uniforms or books. The tribunal was satisfied that they did not meet the requirements of section 71C. Having regard to the evidence, as discussed, the tribunal concluded that payments in the amount of $1,126.37 met the requirements of section 71C and, subject to section 71D, can be credited against Mr Rennell’s child support liability.

2. Section 71D of the Act provides that the Registrar may refuse to credit amounts which meet the requirements of sections 71, 71A or 71C in special circumstances. The tribunal was not satisfied that there are special circumstances in the particular circumstances of this case, such that the amounts ought not to be credited. The tribunal decided, therefore that the amounts set out in the table above, of $1,126.37 can be recorded and credited as prescribed non-agency payments against Mr Rennell’s child support liability under section 71C (up to a maximum of 30% of the amount payable), provided that the other requirements of that section are met (i.e. at the time of crediting Mr Rennell does not have regular care of the child, the remaining 70% of the liability has been paid). This means that the balance of Mr Rennell’s child support liability may not immediately be reduced by the total amount which is able to be credited.

DECISION

The tribunal sets aside the decision under review and substitutes its decision that amounts totalling $1,126.37 are to be credited against Mr Rennell’s child support liability under section 71C of the Child Support (Registration and Collect) Act 1988.