Simmonds & Burke
[2023] FedCFamC1F 50
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Simmonds & Burke [2023] FedCFamC1F 50
File number: MLC 7409 of 2021 Judgment of: CARTER J Date of judgment: 9 February 2023 Catchwords: FAMILY LAW – CHILD MAINTENANCE – application to proceed undefended granted – where the mother has failed to participate in proceedings – where the mother has moved to Country H and is not a resident in Australia for the purposes of section 29A of the Child Support (Assessment) Act 1989 (Cth) – orders made pursuant Part VII, Div 7 for child maintenance.
COSTS – consideration of factors in s 117 of the Family Law Act 1975 (Cth) – costs ordered in a fixed sum.
Legislation: Child Support (Assessment) Act 1989 (Cth) ss 25, 29A, 29B
Child Support (Registration and Collection) Regulations 2018 (Cth) Sch 2
Family Law Act 1975 (Cth) Pt VII, Div 7, ss 66B, 66C, 66E, 66G, 66H, 66J, 66K, 66S, 117
Federal Circuit and Family Court of Australia Act 2021 (Cth)
Income Tax Assessment Act (Cth) s 6
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 7.10, 10.13, 12.17
Cases cited: Cosgrove & Cosgrove (1996) FLC 92-700
In the Marriage of Crapp (1978) FLC 90-460
In the Marriage of Evans (1978) FLC 90-435
In the Marriage of Mee and Ferguson (1986) FLC 91-716Division: Division 1 First Instance Number of paragraphs: 114 Date of last submissions: 24 November 2022 Date of hearing: 24 November 2022 Place: Melbourne Counsel for the Applicant: Mr Daniel Matta Solicitor for the Applicant: Forte Family Lawyers The Respondent: Litigant in person (did not participate) ORDERS
MLC 7409 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR SIMMONDS
Applicant
AND: MS BURKE
Respondent
order made by:
CARTER J
DATE OF ORDER:
9 february 2023
THE COURT ORDERS THAT:
Child Maintenance
1.By way of child maintenance, the respondent pay the sum of:
(a)$1,008.93 per calendar month to the applicant, to be paid on the first day of each month commencing 1 March 2023, for each of the children Y born 2012, Z born 2015 (being a total of $2,017.86 per calendar month); and
(b)$569.14 per calendar month to the applicant, to be paid on the first day of each month commencing 1 March 2023, for the child X born 2008 (“X”).
2.The amounts in Order 1 herein are to be indexed in accordance with the Melbourne CPI All Groups commencing 1 April in each year published for the quarter ending the preceding 31 December.
3.The applicant and respondent each pay one half of all educational, boarding and ancillary expenses associated with X’s enrolment with and attendance at C School (including but not limited to the costs of tuition, board, excursions, school camps, uniforms, books, stationery, school projects and participation in school and/or house events) commencing first term 2023. In the event the applicant meets any of those costs up front, the respondent shall reimburse him within seven days of a written request by him to do so.
4.In the event X leaves C School, then:
(a)the respondent’s obligations to pay maintenance pursuant to Orders 1(b) and 3 herein shall cease, and
(b)the respondent shall pay the same amount of maintenance to the applicant as she pays for the other children pursuant to Order 1(a) and 2 herein.
5.Within 60 days the respondent reimburse the applicant the sum of $1,172.65 being for X’s expenses pursuant to Order 1(b) of the orders made on 5 April 2022; and
Costs
6.Within 60 days the respondent pay the sum of $4,400 to the applicant by way of costs.
Service of Orders
7.The applicant forthwith serve a copy of these orders on the respondent.
Application Dismissed
8.All extant applications are dismissed and the matter be removed from the list of pending cases maintained by the Court.
AND THE COURT NOTES THAT:
A.This matter proceeded on an undefended basis, and in the absence of the respondent. The respondent has her rights pursuant to sub-rule 10.13(1)(a) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 to vary or set aside a judgment or order made in her absence.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Simmonds & Burke has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUSTICE CARTER
INTRODUCTION
This matter was listed for a one day hearing in relation to the final determination of the applicant father’s (“the applicant”) application for child maintenance for the parties’ three children X born 2008 (“X”), Y born 2012 (“Y”) and Z born 2015 (“Z”) (collectively referred to as “the children”), together with an application for costs. The applicant sought additional orders permitting him to travel to the United Kingdom with the children for the 2022/2023 Christmas period. I dealt with that aspect of the proceedings on the day, and otherwise reserved my decision.
APPLICATION TO PROCEED UNDEFENDED
I was provided with a sworn affidavit of service, prepared by Mr Vinh The Nguyen (“Mr Nguyen”), a solicitor at Forte Family Lawyers, who acted on behalf of the applicant. That affidavit is now filed before the court. The contents of that affidavit indicated that the respondent mother (“the respondent”):
(a)had been served with a copy of the orders made on 25 May 2022 that day, by email, which included a notation that in the event of non-compliance, the complying party is at liberty to seek to proceed on an undefended basis;
(b)had been served on 20 October 2022 by email with the applicant’s (Amended) Initiating Application, an affidavit by the applicant, an affidavit by Mr B (“Mr B”), finance professional, and a Financial Statement all filed on 20 October 2022;
(c)had been served by email on 9 November 2022 with the applicant’s affidavit, Parenting Questionnaire, Notice of Child Abuse, Family Violence or Risk and Genuine Steps Certificate filed that day;
(d)had been served by email on 17 November 2022 with the applicant’s Case Outline, trial plan and court book, which included his (Further Amended) Initiating Application filed on 11 November 2022; and
(e)had been advised of the father’s intention to travel with the children to the United Kingdom by way of email on 5 October 2022.
Mr Nguyen deposed that his firm received no response to any of those communications.
The respondent had not complied with my orders as to filing material. The applicant was compliant with those directions.
The respondent had not communicated at all with my chambers, with the applicant, or with his solicitors in the last few months. An attempt was made by my chambers to communicate with her by telephone shortly after 10.00 am, and that call went straight to voicemail. She was formally called at court, and there was no answer to the call. Additionally, the applicant deposed that the respondent has not communicated at all with the children for several months.
I was satisfied that the respondent knew the matter was listed on 24 November 2022, and of all the orders that were being sought. I was also satisfied that the respondent was aware that the matter could proceed in her absence. I noted further the central practice directions, outlining the core principles in family law proceedings, to reduce costs and delays, and to facilitate just resolutions as quickly, inexpensively and efficiently as possible.
In all the circumstances, I granted leave to the applicant to proceed on an undefended basis. Of course, the respondent has remedies available to her under rule 10.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”), to seek to vary or set aside orders made in her absence.
APPLICATION TO TRAVEL
In relation to the application to travel to the United Kingdom, it was plain that the children would be enriched by such an opportunity, socially and culturally. The respondent had not indicated any resistance to such travel. The Convention on the Civil Aspects of International Child Abduction, which is generally referred to as the Hague Convention, is in force between Australia and the United Kingdom. In all the circumstances, I was readily satisfied that it was in the children’s best interests that they be permitted to travel with the applicant between late 2022 and early 2023, and I made orders to that effect.
The applicant did not press his application to vary the final parenting orders made on 25 May 2022, which required that he give the respondent 28 days’ notice of his intention to travel overseas with the children. That was a sensible concession. It is not onerous for him to email the respondent and advise him of any international travel plans. As there is a Family Law Watchlist order in place he will need to return to court on each and every occasion he wishes to take the children outside the Commonwealth of Australia at any rate.
OUTSTANDING ISSUES FOR DETERMINATION
The remaining issues for determination therefore are:
(a)what order, if any, should I make for the support of the children;
(b)whether there are any arrears/outstanding amounts that the respondent should be specifically ordered to pay; and
(c)what order, if any, should I make regarding costs.
BACKGROUND
The applicant is 42 years old. He is employed as a manager, earning approximately $156,900 from that endeavour. He lives in Suburb D, in rental accommodation, and has the full time care of the three children. X is attending boarding school at C School, but is cared for by the applicant on holidays and long weekends. The younger two live full time with the applicant and attend E School. The applicant anticipates they will attend F School in due course.
The parties separated in 2016. At that time the parties initially shared the children’s care. Subsequently those arrangements broke down and the applicant only had sporadic time with the children in 2018 and 2019, and then no time with them from early 2020.
As best as I can tell, the parties lived in City N during their relationship, and the applicant moved to Melbourne in around 2019.
The respondent began working with G Pty Ltd in early 2021. She deposed that she commenced working remotely “but my employment required me to permanently relocate to [Country H]”. She left Australia in mid-2021, and travelled to City J, Country H where she has remained since. She provided no notice to the applicant that she was leaving Australia. She left the children to be cared for by other families and friends, without the applicant’s knowledge or consent. She deposed that her intention was to have the children move with her once she had obtained her residency visa.
The applicant initiated these proceedings on 2 July 2021, seeking parenting and financial orders.
The respondent said she obtained a residence visa in Country H in mid-2021.
At or around mid-2021, the applicant resumed care of Y and Z. The children moved from C School, and into the applicant’s residence in Melbourne, and changed schools to attend E School. The applicant said X was somewhat estranged from him initially, and remained with her host family in City N until early 2022, although she spent increasing time with him. At that time, the parties agreed that X would commence as a boarder at C School, and she attended there throughout 2022, at the parties’ joint expense. The applicant said his relationship with X has much improved, and he now enjoys a close and loving relationship with all three children.
X is now in Year 9 at C School. Y is in Grade 5, and Z in Grade 2 at E school.
The respondent initially participated in these proceedings. That included filing documents, providing her instructions at a number of interim hearings regarding parenting and financial matters, seeking orders for time and communication with the children, and engaging in the preparation of a Family Report.
On 28 February 2022, interim orders were made by consent regarding parenting matters. Y and Z were to live with the applicant, together with X when she was not boarding. The respondent was to have the children for half of the school holidays upon notice. The parties subsequently agreed the respondent would attend for time from 17 to 24 April 2022.
The respondent also provided her consent for final property orders to be made on 5 April 2022. Interim orders by consent were also made on that day for the respondent to pay by way of child maintenance:
(a)$750 per calendar month to the applicant towards the support of each of the children Y and Z;
(b)one half of the educational, boarding and ancillary expenses for X associated with her attendance at C School together with half of all agreed out of pocket medical, dental and similar expenses, and half of all extracurricular expenses.
In the event X was to leave C School, then the respondent was to pay $750 per month towards the support of X as well.
Those amounts were to be indexed in accordance with Melbourne CPI All Groups on 1 April each year.
Those consent orders recorded that the respondent had deposed she was an Australian resident for taxation purposes and would remain so. However, her non participation in these proceedings means she has not confirmed that with the court.
The applicant deposed that at that time the respondent was also meeting other expenses for X, including her mobile phone and a small weekly allowance.
The final property orders provided for the division of the proceeds of the sale of a property at Suburb K. Both parties had received part property payments previously. Under the terms of the final orders the applicant received a further amount of approximately $219,800, and the respondent received $77,500 from the proceeds of that sale. The applicant retained another property in the area. The parties otherwise retained their Australian superannuation entitlements and preserved pensions in the United Kingdom together with personal items.
The matter was then placed in my docket, with child maintenance and parenting issues still to be finally determined.
The respondent did not attend in April 2022 to spend time with the children as had been agreed.
The matter was first before me on 25 May 2022 for case management hearing. At that time, the respondent did not attend at court, but had indicated to the Independent Children’s Lawyer that she consented to the parenting orders sought by the applicant. At that time, I was satisfied it was in the children’s best interests that parenting orders be made in the terms sought by the applicant, and supported by the Independent Children’s Lawyer, and seemingly not opposed by the respondent. Orders were made that day, finalising parenting matters. As already indicated, those orders have been served on the respondent. She has not taken any steps to vary or set aside those orders.
Those orders provide, inter alia, that;
(a)the children live with the applicant, who has sole parental responsibility for the children;
(b)the children spend time with the respondent at times agreed, in Australia upon the respondent providing 28 days’ notice of her intention to come to Australia;
(c)the parties communicate using the Our Family Wizard parenting app;
(d)the children’s belongings be returned to them; and
(e)orders for the provision of information about the children’s health and wellbeing.
The children were also placed on the Family Law Watchlist until further order, with the applicant at liberty to seek that order be discharged to enable him to travel overseas with the children, and to be replaced upon the children’s return to Australia. The applicant was to give the mother 28 days’ notice of his intention to travel outside of Australia with the children.
I otherwise set the outstanding child maintenance issues down for final hearing.
The respondent has not travelled to Australia to spend time with the children since those orders were made. She last spoke with Y and Z in early 2022. She last spoke with X in mid-2022. It is unclear to me why the respondent currently appears to be playing no role in the children’s lives.
The applicant asserted that the respondent has not been wholly compliant with the interim orders regarding child maintenance. He said she has not reimbursed him for half of X’s schooling and other expenses. He said he had made multiple requests that she reimburse him but she had not done so. He said the respondent had also stopped meeting additional expenses for X, including that she was no longer paying for X’s mobile phone or providing her with a modest weekly allowance. These are additional expenses the applicant has been meeting.
The applicant deposed making requests for reimbursement on 28 April 2022, 4 June 2022 and 18 October 2022. In around May 2022 the respondent’s then lawyers did engage in some discussion about the reimbursements sought, but shortly thereafter those lawyers filed a Notice of Ceasing to Act. There was no response to the request for reimbursement following the correspondence on 18 October 2022.
As at the date of the hearing before me, there were outstanding amounts owed. According to the applicant’s affidavit he said $1,172.65 remained outstanding as the respondent’s half of X’s expenses, met in total by the applicant.
The applicant further asserted that the respondent had been tardy in making the payments of $1,500 per month for the other children. However, I note the applicant concedes the monthly amount is paid, although sometimes it is a few days late.
These assertions as to non-payment and late payment are effectively unchallenged.
The applicant asserted that the amount of maintenance stipulated in the consent order was agreed on an interim basis, and in circumstances where the respondent was expected to spend time with the children, providing for their care when she travelled to Australia. As she has elected not to do so, the applicant said he now must meet the children’s needs at all times. He said further that without proper financial support, the children would be unable to maintain their current lifestyle.
CHILD MAINTENANCE APPLICATION
Why child maintenance and not child support
Section 66E of the Family Law Act 1975 (Cth) (“Family Law Act”) provides that this court cannot make an order for child maintenance under the Act if an application can properly be made for child support under the Child Support (Assessment) Act 1989 (Cth) (“Child Support (Assessment) Act”).
Section 25 of the Child Support (Assessment) Act sets out that an application for child support under that Act can only be sought against a person who is a parent of the child. In circumstances where a parent is not a resident in Australia on the day the application for an assessment is made, the application must meet the requirements of ss 29A and 29B. Only the provisions of s 29A are relevant.
Section 10 of the Child Support Assessment Act defines a resident of Australia as being a person who is a resident for the purposes of the Income Tax Assessment Act 1936 (Cth) (“Income Tax Assessment Act”).
At s 6 of the Income Tax Assessment Act , as resident or resident of Australia is, relevantly defined as:
(a)a person, other than a company, who resides in Australia and includes a person:
(i)whose domicile is in Australia, unless the Commissioner is satisfied that the person’s permanent place of abode is outside Australia;
(ii)who has actually been in Australia, continuously or intermittently, during more than one‑half of the year of income, unless the Commissioner is satisfied that the person’s usual place of abode is outside Australia and that the person does not intend to take up residence in Australia;
The respondent does not appear to be domiciled in Australia. She has not resided here since mid-2021. In the course of the parenting proceedings she informed the Independent Children’s Lawyer and the Family Report Writer she would not be returning to Australia. It does not appear she owns property here. She did not travel to Australia in 2022 to spend time with the children, as had been previously expected. She works in Country H, and has lived there and remained there since mid-2021.
Taking all these matters into account it seems to me the respondent could not be considered a person who resides or is domiciled in Australia.
Section 29A of the Child Support (Assessment) Act applies if an application is made for an assessment in relation to a parent who is not a resident of Australia on the day the application is made. In those circumstances the Act relevantly stipulates:
(3) … the application is taken to have been properly made only if:
….
(b)the parent is a resident of a reciprocating jurisdiction on the day on which the application is made.
Turning to Schedule 2 of the Child Support (Registration and Collection) Regulations 2018 (Cth), Country H is not a reciprocating jurisdiction.
Accordingly, an application cannot be properly made under the Child Support (Assessment) Act. The matter thus falls to be determined pursuant to Part VII, Division 7 of the Family Law Act.
Section 66S of the Family Law Act 1975 (Cth)
The provisions of s 66S set out that if there is a maintenance order in place, and a party applied to the court for an order “in relation to the first order”, the court must not vary the order, by increasing or decreasing the amount ordered to be paid unless satisfied:
(a)that the circumstances for the children, or either parent have changed so as to justify a variation; or
(b)since the order was made the cost of living has changed to such an extent as to justify the variation (and 12 months have elapsed since the first order was made); or
(c)if the order was made by consent, the amount is not proper or adequate; or
(d)material facts were withheld from the court when the order was made.
Whilst there is an order currently in place, that is an interim order. I expect this section is intended be in relation to applications to vary final orders. However, even if that is not the case, I am satisfied both that the circumstances for the parties have changed to the extent that a variation is justified.
In particular, as set out, I note that the interim order was agreed to in circumstances where the mother was anticipated to participate in the children’s care. She has not done so. Further there have been issues in relation to the applicant being reimbursed by the respondent for expenses he has had to meet due to the respondent’s non-compliance.
Additionally, as I now set out, I am satisfied that the amount set for the children’s maintenance in the interim order is not proper or adequate.
Principles applied in a child maintenance application
The objects of this section are set out at s 66B of the Family Law Act. The principal object of this Division “is to ensure that children receive a proper level of financial support from their parents”. The particular objects of the Division are set out at subsection (2) as ensuring:
(a) that children have their proper needs met from reasonable and adequate shares in the income, earning capacity, property and financial resources of both of their parents; and
(b) that parents share equitably in the support of their children.
Section 66C of the Family Law Act imposes a primary duty on both parents to maintain their children. As set out in s 66C(2), that duty:
(a)is not of lower priority than the duty of the parent to maintain any other child or another person; and
(b)has priority over all commitments of the parent other than commitments necessary to enable the parent to support:
(i) himself or herself; or
(ii) any other child or another person that the parent has a duty to maintain; and
(c)is not affected by:
(i) the duty of any other person to maintain the child; or
(ii) any entitlement of the child or another person to an income tested pension, allowance or benefit.
Section 66G of the Family Law Act sets out the general principle to be applied being that the court may make such child maintenance order as it considers proper.
Section 66H of the Family Law Act sets out the approach to be taken in proceedings for child maintenance proceedings. That section provides that the court must:
(a)consider the financial support necessary for the maintenance of the children and
(b)determine the financial contributions, or respective financial contributions towards the financial support necessary to maintain the children that should be made by the parties
What financial support is necessary for the maintenance of the child – s 66J of the Family Law Act 1975 (Cth)
In considering the financial support necessary for the maintenance of the child, I must take into account only the matters set out in s 66J(1). Those matters are:
(a) the matters mentioned in section 66B; and
(b) the proper needs of the child (this is expanded on in subsection (2)); and
(c)the income, earning capacity, property and financial resources of the child (this is expanded on in subsection (3)).
Pursuant to s 66J(2), in determining what are the proper needs of the children, I must have regard to the children’s respective ages, the manner in which the children are being educated and the parents’ expectations about that education as well as any special needs of the children.
As set out, I must have regard to the objects of the Family Law Act – being to ensure children have their proper needs met from a reasonable and adequate share in the income, earning capacity, property and financial resources of both parents and that parents share equitably in the support of their children who – as parents – they have a primary duty to maintain.
The applicant bears the onus of proof to satisfy the court as to the amounts he says are necessary to support the children.
The word “necessary” does not mean “absolutely essential”, but involves a consideration of “reasonableness”; see Cosgrove & Cosgrove (1996) FLC 92-700 at 83,389.
I note the concept of need is not limited to “bare necessities” but is determined by reference to the previous standard of living enjoyed by the children; see In the Marriage of Crapp (1978) FLC 90-460; In the Marriage of Evans (1978) FLC 90-435; In the Marriage of Mee and Ferguson (1986) FLC 91-716.
X is 14 years old. Y is 10 and Z 7. Y and Z live with their father in Melbourne. X boards at C School and lives with the father on holidays. Y and Z attend E School. They are in Grade 5 and 2 respectively.
The applicant deposes that it costs approximately $35,000 – $37,000 per annum for X to remain a boarder at C School. There is some inconsistencies in the figures the applicant has included in his financial statement and at paragraph 37 of his affidavit filed 20 October 2022. The applicant says X is settled at C School and progressing well. Given the disruptions she has endured in her care arrangements, he says it is appropriate that she remain at that school. It is apparent that the parties agreed for X to be enrolled at C School at the parties’ equal expense. On the basis of the matters deposed in the respondent’s affidavit filed earlier in these proceedings, and her consent to the orders made on 5 April 2022 it is apparent she supported X’s attendance at that school, and her equal contribution to those expenses.
The applicant sets out in detail the other expenses he anticipates will be incurred on behalf of the children. That includes amount allowed for food, household supplies, utilities, telephone, meals out, lunch orders, petrol, dry cleaning, entertainment and extracurricular activities. According to these detailed calculations he says the children’s expenses are $1,734 per week. However, that includes his 50 per cent of X's school fees. If I subtract the costs of X’s schooling from the amount he sets out in his financial statement as being sums incurred for the support of the children on a weekly basis, the weekly amount is reduced to $1,372.
Having carefully considered the amounts sought, including the applicant’s explanation regarding anticipated expenses, such as sport and the engagement of Ms L, counsellor, and taking into account the objects of s 66B of the Family Law Act, and the proper needs of the children, I accept these sums are reasonable and necessary save for two exceptions. The only amount I have excluded is that for a cleaner. Whilst that might be optimal, I do not regard it as necessary. Further, the amounts sought by the applicant for the children’s entertainment and hobbies (at $99 per week) and for their holidays (at $150 per week which according to his itemised note includes provision for anticipated overseas travel) does seem to go beyond what could be described as “necessary”. I am allowing a total of $135 per week for all three children for those expenses, which equates to $45 per week per child. I regard that as a reasonable amount.
Taking all these matters into account, I am satisfied that the financial support necessary for the maintenance of the children, when considering their proper needs, their ages, and the manner in which they are being educated are as follows:
(a)the weekly amount of $1,194; and
(b)all of X’s school and ancillary expenses.
The weekly amount needs to be appropriately apportioned between the three children. Some of the amounts are referrable to X only, and other amounts to the younger children. X’s food costs are currently included in the costs of her boarding, for instance. According to the orders sought by the applicant, he attributes approximately 22% of the weekly expenses towards X, and the balance to Y and Z. That seems an appropriate division given that X spends school terms away from the home. Following from that, and on the basis of what I have determined is the financial support necessary for the maintenance of the children, weekly expenses of $262.68 would be attributable to X whilst she remains as a boarder, and $465.66 per week to each of her siblings.
What contributions should be made by the parties – s 66K of the Family Law Act 1975 (Cth)
I must now consider what contribution or respective contribution each of the parents should make towards the maintenance for the children.
Section 66K(1) sets out the raft of considerations to be taken into account in determining what contributions each of the parents should make towards the support of their children. That includes the objects and principles of the Family Law Act, and:
…
(b) the income, earning capacity, property and financial resources of the party or each of those parties (this is expanded on in subsection (2)); and
(c) the commitments of the party, or each of those parties, that are necessary to enable the party to support:
(i) himself or herself; or
(ii) any other child or another person that the person has a duty to maintain; and
(d) the direct and indirect costs incurred by the parent or other person with whom the child lives in providing care for the child (this is expanded on in subsection (3)); and
(e) any special circumstances which, if not taken into account in the particular case, would result in injustice or undue hardship to any person.
When considering the income, earning capacity, property and financial resources of the parties, I am required to have regard to the capacity of the parties to earn income and derive income. Additionally, I am required to take into account the income and earning capacity forgone by the parent providing care.
I am also required to consider the capacity of the paying party to make periodic payments, before considering whether that maintenance should be paid by way of lump sum or property transfer.
The applicant is a manager, earning approximately $156,900 per annum. In addition he has an investment property which he anticipates will provide him with an additional $7,681 net rent per annum when rented. The property he owns is valued at $590,000 and is unencumbered. He also has a car valued at $9,500 and has savings of around $26,000. His superannuation entitlements are approximately $116,000. His liabilities total approximately $7,500.
The respondent was working at M Organisation, earning $135,000 per annum. She commenced employment with G Pty Ltd as a manager in mid-2021 and then moved to Country H a short time later 2021. She received a part property settlement in late 2021 and a further $219,852 at settlement of the sale of the Suburb K property. She also retained her superannuation of $163,000 as part of the final property orders.
The respondent has failed to provide the court with up to date information regarding her financial circumstances. She was requested to provide updated disclosure by the applicant’s solicitors under cover letter dated 7 October 2022. No response was received to that correspondence prior to the hearing before me.
According to the respondent’s contract signed on 11 May 2021, she earns … in the currency of Country H per annum. As at the date of the hearing before me, that amounted to approximately AUD126,895. However, the applicant deposed that Country H is a tax free jurisdiction. Additionally, the applicant receives significant additional benefits and allowances from her employer, including the provision of a small apartment for accommodation, monthly meal stipends, phone, laptop computer and internet access.
The applicant relied on an affidavit of Mr B, finance professional, filed on 20 October 2022.
I gave the applicant leave to tender the report from Mr B. Given the respondent’s non-participation in the proceedings, and her failure to respond to correspondence from the applicant’s solicitors, the parties were unable to jointly agree on an appropriately qualified expert to provide evidence as to the respondent’s income. Mr B prepared a report in this matter dated 22 February 2022 which was annexed to his affidavit. Mr B is a finance professional employed at O Pty Ltd.
Mr B was asked to provide an estimate of the respondent’s gross income in Australian dollars taking into account her benefits.
Mr B did not depose, as a single expert would, to having made all inquiries, not omitted information, and complied with all professional codes of conducts. Whilst Mr B’s evidence may not wholly meet the exacting standards of an expert witness report, I note that it does not seem, on its face, that there is any obvious error to Mr B’s methodology or conclusions. He has also been wholly transparent regarding the information provided to him.
Pursuant to rule 7.10 of the Rules, there may be circumstances in which the court gives permission for a report to be adduced from an expert other than a single expert. In my view, this is an appropriate circumstance. I note further the overarching principles in the Federal Circuit and Family Court of Australia Act 2021 (Cth), include the desirability of resolving disputes as quickly, inexpensively and efficiently as possible. In circumstances where the respondent is not participating in the proceedings, and has not taken the opportunity to challenge the evidence of Mr B, there is little utility in the court requiring the applicant to expend additional funds or further delay the resolution of these proceedings for a more detailed report.
Mr B deposed that the respondent’s income would be regarded as totalling AUD181,540, taking into account the employment benefits she receives in addition to her salary. In the event the applicant is a non-tax resident of Australia, and accordingly, would have no obligation to pay tax on her income either here or in Country H, Mr B calculated her annual package including all benefits as equivalent to AUD287,183 as at the date of his report being 22 February 2022. That is clearly substantially higher than the applicant’s income.
The respondent has not provided any response to that affidavit or report. Indeed she has filed no documents at all in accordance with my trial directions.
In circumstances where it appears the respondent would not be a resident of Australia for the purposes of income tax for the reasons previously outlined, it seems to me that it is appropriate that I accept the unchallenged evidence of Mr B as to the real dollar value of the respondent’s income. Whilst there is some suggestion that the respondent had previously indicated she would remain a resident here for tax purposes, she did not participate in the final hearing to make that assertion.
The parties do not have any other person to maintain other than the children. As already set out, the applicant is responsible for the full time care of the children, without the assistance of the respondent. Of course they both have commitments to support themselves.
Taking into account all these matters, together with:
(a)the parties’ income, earning capacity, property and financial resources and noting the evidence as to the real dollar value to the respondent of her employment package; and
(b)the objects of the division – being to ensure the children’s proper needs are met from a reasonable and adequate share of the income, earning capacity, property and financial resources;
I am satisfied it is appropriate that the parties equally share the costs of the children’s weekly expenses. Given that the parties consented to X’s attendance at C School, at their equal expense, I am of the view that parties should continue to meet those costs in addition to the weekly expenses for the children. That will ensure the parents share equitably in the support of the three children.
Given the amounts I have determined to be the financial support necessary for the maintenance of the children (totalling a weekly amount of $1,194), the respondent’s half share of those expenses would amount to $31,044 per annum. If I add to that the respondent’s half share of the expected costs of and associated with X attending C School of approximately $18,500, the respondent would be contributing a total of $49,544.
I note that the total amount she would be paying by way of period payments, and contribution towards X’s educational expenses does exceed what the respondent previously agreed to pay. Previously, the respondent was prepared to agree to pay $750 per month for each of the younger children (being $18,000 per annum in total), to meet half of the costs for X’s education, as well as half of the costs of her out of pocket medical expenses, and extracurricular activities. I note at the time those orders were made the respondent was paying additional costs for X, including her phone and pocket money. That indicates a capacity for the respondent to meet at least those costs.
It was also expected that the respondent would be travelling to Australia to spend time with the children. In those circumstances, she would be providing financially for the children during all periods that they were in her care. That would include providing accommodation for them during her trips here. However, she has elected not to return. That has resulted in the applicant shouldering an even greater share of the children’s financial support. At the same time, the respondent is not incurring additional expenses to travel to Australia to spend time with the children. I note further that the respondent has not attended court to assert that she is unable to make contributions towards the children as outlined in detail by the applicant, nor to challenge the expenses he sets out as being necessary for their care.
I accept the applicant’s evidence that there have been issues with securing reimbursement for X’s out of pocket medical expenses and extracurricular activities. It makes sense for a periodic amount to be fixed, rather than requiring the applicant to provide the respondent with invoices given the difficulties he has had in communicating with her and being reimbursed.
In the particular circumstances of this matter, I am satisfied that in addition to paying half of the boarding and tuition fees for X, the parties should otherwise share equally in the costs of maintaining the children and meeting what I have determined to be the financial support that is necessary, and otherwise proper. In my view that will ensure the children have their proper needs met, and that they appropriately share in the income, earning capacity, property and financial resources of their parents. Those orders also in my view ensure that the parents share equitably in the support of their children.
Following from that, and on the basis of what I have determined is the financial support necessary for the maintenance of the children, of the total weekly expenses of $1,194, the respondent’s half share of the weekly expenses attributable to X would be $131.34 per week, and $232.83 per week for each of her siblings.
In the event X ceases attending at C School, it is appropriate that the monthly amount to be paid by the respondent to the applicant would increase to the same as for her siblings. If that were the case, the applicant would then have to house and feed X, and meet the costs of her attending a school in Melbourne.
OTHER AMOUNTS SOUGHT
The applicant sought an order that the respondent reimburse him for half of X’s expenses due to be repaid to him pursuant to Order 1(b) of the order made 5 April 2022. As best as I understand his affidavit, he was not reimbursed the following sums, totalling $1,172.65:
(a)$226.49 incurred in April 2022;
(b)$210.29 incurred in June 2022; and
(c)$735.87 incurred in October 2022.
The applicant also sought to be paid a further $186, being the costs he had to incur in obtaining new birth certificates for the children. I note that pursuant to the final orders dated 25 May 2022 the respondent was required to provide those birth certificates to the applicant, but failed to do so.
In addition, the applicant sought the respondent pay him $953, being expenses he had to incur for the children’s entertainment and care over the April 2022 Easter holidays, when the respondent failed to return to Australia to spend time and provide care for the children.
In my view, only the first of these additional costs is properly sought, being costs contemplated and which have not been reimbursed.
I do not have, in my view, the power under Part VII, Division 7 to make an order for the payment of the birth certificates or to retrospectively reimburse the applicant for the child care costs over Easter 2022.
COSTS
The applicant sought an order for costs.
The general rule in relation to costs is that each party will bear their own costs. That is set out in s 117(1) of the Family Law Act. However, that rule is subject to the provisions of s 117(2). That subsection provides that a court may make such order for costs as it considers just if “…the court is of opinion that there are circumstances that justify it in doing so…”.
Subsections 117(2A)(a)-(g) of the Family Law Act set out the matters the court must consider in determining whether to exercise its discretion and make an order as to costs. No one factor must be present, and no particular factor is to be given more or less weight than any other. The factors to which the court must have regard are as follows:
(a)the financial circumstances of each of the parties to the proceedings;
(b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters
(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
(e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(f)whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
(g)such other matters as the court considers relevant.
I have already set out the financial circumstances of the parties. Neither is in receipt of legal aid. I note the applicant has substantially complied with court orders for filing documents. It is plain that the respondent has not complied with those orders and has failed to participate meaningfully in these proceedings for many months.
The applicant outlines that the respondent has also not wholly complied with the interim maintenance orders of a Senior Judicial Registrar, regarding reimbursement for X’s expenses. I note those orders were made by consent. As I have already indicated, the respondent also did not comply with the order that she provide the applicant with the children’s birth certificates. The respondent has paid $186 to obtain those documents. He has also incurred fees in having to depose to these matters in his material.
As a result of the respondent not participating, the applicant has had to incur the expense of solely engaging finance professional in relation to the proper calculation of the respondent’s income.
The orders I am making substantially reflect the orders sought by the applicant. I do not know what orders the respondent may have sought – as she has simply not participated. I am not aware of any offers having been made.
I note that core principle six in the Central Practice Direction – Family Law Case Management deals with the non-compliance of a party to proceedings. Part 3.12 provides that:
If at any time during the course of proceedings, the Court considers that a party or their legal representatives have pursued or defended an Application, Response or Reply without legal foundation and/or other than in good faith or without making a reasonable and genuine attempt to resolve the issue(s) in dispute where safe to do so, the Court may:
…
(h)make such other orders as are appropriate, including orders for costs, which may include an order for costs against a party’s legal representatives.
It does not appear there have been any attempts made by the respondent to resolve the remaining issue of child maintenance.
In the exercise of what has been described as a wide discretion, and taking all of the factors into account, it does seem to me that in this matter, there are circumstances that justify departing from the usual rule regarding costs. In my view, it is appropriate that the respondent makes a contribution to the applicant’s costs.
Whilst expressed in his material that he sought indemnity costs of $28,000, that was sensibly not pursued by counsel.
In terms of the quantum, pursuant to rule 12.17 of the Rules, I am able to fix an amount for costs. This enables the parties to avoid the expense, delay and inconvenience involved in taxation. In making an order under rule 12.17(1), as I am, I may consider:
(a) the importance, complexity or difficulty of the issues;
(b) the reasonableness of each party’s behaviour in the proceeding including by having regard to the matters set out in sub-rule 12.08(2);
(c) the rates ordinarily payable to lawyers in comparable proceedings;
(d) whether a lawyer’s conduct has been improper, unfair, unreasonable or disproportionate;
(e) the time properly spent on the proceeding, or in complying with pre-action procedures;
(f) whether expenses (paid or payable) are fair, reasonable and proportionate.
There is some complexity. I have outlined the respondent’s lack of participation, which has not been explained. Conversely, the applicant’s conduct, and that of his lawyers, has been reasonable and appropriate. I accept that in all the circumstances, the applicant has incurred some additional costs as a result of the respondent’s conduct, including her failure to provide updated disclosure as to her financial position and her failure to properly participate in these proceedings.
However, I also note that the matter was able to be heard and concluded on 24 November 2022, being the date it was listed.
Taking all these matters into account, and in the exercise of my very broad discretion I will order that the respondent pay the sum of $4,400 towards the applicant’s costs.
For all of the foregoing reasons, I will make the orders as are set out.
I certify that the preceding one hundred and fourteen (114) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Carter. Associate:
Dated: 9 February 2023
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