Shastri and Child Support Registrar (Child support)

[2020] AATA 5970

Shastri and Child Support Registrar (Child support) [2020] AATA 5970 (10 December 2020)

DIVISION:Social Services & Child Support Division

REVIEW NUMBERS:  2020/SC020088, 2020/SC020120, 2020/SC020122, 2020/SC020123, 2020/SC020125, 2020/SC020126, 2020/SC020129, 2020/SC020130

APPLICANT:  Ms Shastri

OTHER PARTY:  Child Support Registrar

TRIBUNAL:Member K Buxton

DECISION DATE:  10 December 2020

DECISION:

The decisions under review are affirmed.

CATCHWORDS

CHILD SUPPORT – refusal to grant an extension of time to object - no satisfactory explanation for the delay – little merit - weighing all factors the extension of time was correctly refused - decision under review affirmed

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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. Ms Shastri and Mr Shastri are the parents of two children in respect of whom Mr Shastri was assessed by the Child Support Agency (CSA) to pay child support to Ms Shastri.

2. The payment of child support can be a private matter between the parents. Alternatively, it can be registered for collection by the CSA in which case the child support payable becomes a debt owed to the CSA. Ms Shastri initially elected to collect the child support payments privately then, in late 2018, she applied to have the CSA collect them.

3. On eight separate occasions from late 2018, Mr Shastri met, in full, the home loan payments for the family home in which Ms Shastri was living with the children. He applied to have a total of 25 such payments of $914.39, totalling $22,859.75, credited against his child support liability and, on each occasion, the CSA allowed the request and credited the payments.

4. The relevant legislation is contained in the Child Support (Registration and Collection) Act 1988 (the Act). Subsection 71(1) of the Act provides that a payment directly to the recipient of child support can be credited against the amount of child support payable if the payment was intended by both child support parties to be a payment in satisfaction of the child support liability. The CSA refers to these credits as non-agency payments. The CSA recorded the communication by Ms Shastri of her consent to the non-agency payments being credited against Mr Shastri’s child support liability on various occasions. The earliest of the eight decisions made by the CSA was on 8 April 2019 and the latest was made on 24 February 2020.

5. On 25 June 2020 Ms Shastri objected to the eight decisions of the CSA. Ms Shastri’s objections were all well outside the 28-day time frame for objections provided for in the legislation, some by over a year. Her objections were accompanied by an application to extend time within which to object. Her applications for extensions of time within which to lodge an objection were refused by a CSA objections officer on 6 October 2020. Ms Shastri then applied to the tribunal to have the objections officer’s decisions reviewed.

6. The tribunal hearing took place on 10 December 2020 and Ms Shastri participated in the hearing by conference telephone, giving sworn evidence. In reaching its decision the tribunal has considered the information provided by the CSA (Exhibit 1) together with the sworn evidence Ms Shastri gave during the hearing.

CONSIDERATION

Background and legislative framework

1. A parent may object to a decision made by the CSA pursuant to section 80 of the Act. Section 81 of the Act provides that an objection must be lodged within 28 days after notice of the decision is served on the person.

2. The decisions to which Ms Shastri wished to object were made on various occasions between 8 April 2019 and 24 February 2020 and, on each occasion, the decision was notified to Ms Shastri by letter. The CSA papers show that Ms Shastri was notified of each of the decisions in writing and in a timely way and that she would require a substantial extension of time for her objections to proceed.

3. Section 82 of the Act relevantly provides that a person may apply for an extension of time in which to lodge an objection and that the application must state fully and in detail the grounds of the application, including the circumstances concerning, and the reasons for, the failure by the person to lodge the objection within the 28 day time period prescribed. Ms Shastri stated that she had been struggling with multiple health issues [stating] that she barely had the energy to go through the day.

4. The Act does not set out criteria for consideration when considering an application for an extension of time within which to object. However, the Child Support Guide (the Guide) contains useful guidelines at chapter 4.1.5. In summary, the Guide suggests that it is ultimately a question as to whether the interests of justice favour the grant or refusal of the application in the particular circumstances. Factors to be considered are the reason for the delay, the merits of the objection, whether the person has rested on their rights and any potential prejudice to the other party or the public. 

5. The established cases indicate that the starting position is the prima facie rule that proceedings commenced outside a statutory period will not be entertained (Lucic v Nolan (1982) 45 ALR 411 at 416). However, the primary concern “is to do that which will enable justice to be done between the parties” (see Martinsen v Secretary, Department of Family & Community Services [2004] FCA 297 per Spender J). Spender J quoted McHugh J in Gallo v Dawson (1990) 64 ALJR 459 as follows:

   In order to determine whether the rules [imposing time limits] will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time ...

   When the application is for an extension of time …it is always necessary to consider the prospects of the applicant succeeding in the appeal …

6. In line with Wilcox J’s survey of cases in Hunter Valley Developments P/L v Cohen (1984) 3 FCR 344, the tribunal proposes to consider the matters identified in Gallo v Dawson under the following heads:

   ·      the explanation for the delay;

   ·      the merits of the substantial application;

   ·      any prejudice to the other party including any prejudice in defending the proceedings occasioned by the delay; and

   ·      any public interest considerations that might flow from a successful application including “the unsettling of other people” (Ralkon v Aboriginal Development Commission(1982) 43 ALR 535 at 550) or of “established practices” (Douglas v Allen (1984) 1 FCR 287).

Explanation for the delay

1. Ms Shastri has provided an explanation for the delay. She stated that she and Mr Shastri had been separated but remained under the same roof until November 2018. Ms Shastri stated that, during this period, she had been suffering from [various medical conditions] and had been taking a range of medications. She stated that her energy levels and mood had been very low. In February 2020 the parents reached a property settlement by agreeing to consent orders. However, Ms Shastri stated that, although she was legally represented in the property settlement, she was not satisfied with the distribution in the property settlement. Ms Shastri stated that Mr Shastri had removed money from the joint asset pool and had been using that money to make the joint home loan repayments. Ms Shastri also stated that the home loan repayments had been credited to Mr Shastri in the property settlement.

2. Ms Shastri stated that she did not have the energy to fight for her entitlements in the property settlement and that her health was suffering. As a result, Ms Shastri stated that Mr Shastri has, in effect, double recovered by receiving a credit for the home loan repayments in the child support case and an adjustment for these payments in the property settlement. Ms Shastri also stated that Mr Shastri further benefitted as he had taken money from a joint bank account and used that money to make the home loan repayments. The tribunal observes that, ordinarily, an adjustment would be made for these facts in the parents’ property settlement.

3. It was only after the property settlement was finalised that Ms Shastri approached the CSA to question the crediting of the non-agency payments. The details of that property settlement are not before the tribunal, so it is unclear whether the facts asserted by Ms Shastri accurately represent all of the facts in relation to that settlement. The tribunal notes that Ms Shastri feels genuinely aggrieved by the terms of the parents’ property settlement, even though she agreed to those terms at the time. Ms Shastri stated that she lacked the energy to keep fighting and agreed to terms that were unfavourable.

4. Ms Shastri stated that she did not understand the consequences of accepting the non-agency payments until after the property settlement. However, the CSA papers show that CSA officers explained the crediting process, and sought Ms Shastri’s confirmation that she understood, on a number of occasions in April 2019, and again by letter dated 23 July 2019. Ms Shastri raised a number of other issues relevant to the child support case at that time, including refusing other non-agency payments claimed by Mr Shastri and raising issues with respect to Mr Shastri’s income used in the child support case. It was reasonable for the CSA to infer from these contacts that Ms Shastri well understood the significance of accepting, as a credit to Mr Shastri’s child support liability, the amounts he had paid towards Ms Shastri’s portion of the home loan repayments.

5. The tribunal observes that, had the terms of the property settlement been regarded by Ms Shastri as more favourable, it is unlikely that Ms Shastri would have sought to object to the decisions to credit the non-agency payments for the home loan repayments. The better interpretation of the facts is, therefore, that the terms of the property settlement agreed in February 2020 (and not the earlier acceptance of the non-agency payments) had consequences that were not intended by Ms Shastri. It is not open to an objections officer to consider whether Ms Shastri has later changed her mind, or altered her position, in relation to her earlier intention that the non-agency payments be credited against Mr Shastri’s child support liability.

6. In any event, Ms Shastri entered into the property settlement in February 2020 then discussed with the CSA the prospect of objecting to the decisions in April and May 2020. By the time she lodged her objections, and applications to extend time, a further four months had elapsed since the property settlement. Ms Shastri stated that she was unwell and also busy at work during this time. However, her evidence did not demonstrate that she was unable to lodge an objection earlier than 25 June 2020 and she has consistently been able to communicate meaningfully with the CSA on such issues at various times material to this application.

7. The letters notifying Ms Shastri of the decisions clearly stipulated the 28-day time frame within which Ms Shastri could object if she disagreed with those decisions. Ms Shastri may have formed the view that she only wished to object after the property settlement, but the tribunal is not satisfied that she was prevented from objecting within the 28-day time frame. Further, the tribunal notes that Ms Shastri did not develop her intention to object until she determined that her interests had not been met to her satisfaction in the property settlement which indicates a change of mind in relation to her intent, rather than a lack of intent that the amounts be credited when the decisions to do so were made.

Merits of the objection

1. As to the merits of the decision, the CSA relied on a clear expression of intention by Ms Shastri, expressed by her during various telephone calls with CSA officers and confirmed to her by the CSA in correspondence, that an amount equivalent to half of the total home loan repayments made by Mr Shastri should be credited against his child support liability. Ms Shastri accepted that, at the times when the non-agency payments were credited, she had communicated her agreement to the credits. Ms Shastri accepted that the CSA papers show that this consent was communicated to Mr Shastri and that she did not countermand that consent until well after the final amount was credited. However, Ms Shastri stated that she had not understood the significance of agreeing to have the home loan payments credited against Mr Shastri’s child support liability at the time she indicated her consent.

2. The starting point for an application under subsection 71(1) of the Act is whether a payment made on behalf of the recipient of child was intended by both child support parties to be a payment in satisfaction of the child support liability. Here, at the time of credit, the payments were so intended. Therefore, it was proper that the amount of those payments be credited against the amount of child support payable.

3. Here, there is no dispute that Mr Shastri made the home loan repayments in the amounts credited, and that those payments represented half of Ms Shastri’s obligation. That they may have been paid from a joint pool is something that was open to the parents to deal with in their property settlement. A reconsideration of the decisions to credit the payments based on the mutual intent of the parents at the time the payments were made is not the proper mechanism for reconsideration of these now long settled aspects of the child support case.

4. The CSA has accepted that Mr Shastri made certain payments and Ms Shastri agreed to accept them in lieu of child support at the time they were credited against Mr Shastri’s assessed liability. Those findings were perfectly open to the decision maker and, were the objections to proceed, the objections officer would likely come to the same view and therefore affirm the decisions.

Potential prejudice

1. The tribunal observes that Mr Shastri has been entitled to regard the question of the crediting of non-agency payments for home loan contributions as long settled. He has been entitled to act on the assumption that the payments are to be credited and may have altered his position in reliance upon that reasonable assumption. The property settlement is now finalised. The tribunal must weigh the potential prejudice to Mr Shastri against the other factors relevant to the application for an extension.

Public interest considerations

1. The statute provides for a 28-day time limit for the lodgement of objections so that parents (and the CSA) can act with certainty as to the outcome when the objection period has elapsed. The public has an interest in reviews of decisions made by the CSA being performed in a timely fashion and in a manner that ensures all applicants are treated fairly and equally. Accordingly, an extension of the time for objection is not to be automatically granted and the substantial length of the extensions of time needed by Ms Shastri is a relevant factor.

Conclusion

1. Ms Shastri was required to lodge her objections within 28 days unless she had good reason for not doing so and, whilst she has explained the delay, the tribunal has found Ms Shastri was not prevented from objecting within time. Further the tribunal is not satisfied on the available evidence that the issues raised by Ms Shastri are likely to result in a favourable review outcome, the public interest is not served by the grant of an extension of time and there is potential prejudice to the other party should the objection proceed.

2. Given the conclusions set out above, the tribunal finds that granting extensions of time in which to object is not in the interests of justice and it is proper to refuse the applications. The tribunal has reached the same decision as that reached by the objections officer in refusing Ms Shastri’s applications for an extension of time and the tribunal therefore affirms the decisions under review.

DECISION

The decisions under review are affirmed.