Smith and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Grimstone (Party Joined)

[2008] AATA 121

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 121

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/3008

GENERAL ADMINISTRATIVE DIVISION		)
Re		CHRISTOPHER SMITH

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

And SUZANNE GRIMSTONE

Joined party

DECISION

Tribunal Deputy President P E Hack SC

Date              15 February 2008  

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

...............Signed................

Deputy President

CATCHWORDS

SOCIAL SECURITY – family tax benefit – pattern of care – children who are in a parent’s care for less than 10 per cent of the time are not Family Tax Benefit children – evidence shows children were in the applicant’s care less than 10 per cent of the time – decision under review affirmed

WORDS AND PHRASES – “pattern of care”

A New Tax System (Family Assistance) Act 1999 (Cth.) – ss 22, 25, 26

Wade v Secretary, Department of Family and Community Services (2004) 139 FCR 285

REASONS FOR DECISION

15 February 2008 Deputy President P E Hack SC

1.This is an application by Mr Christopher Smith to review a decision of the Social Security Appeals Tribunal made on 28 May 2007. That decision set aside the earlier decision of Centrelink, on behalf of the Secretary, that Mr Smith and the joined party, Ms Suzanne Grimstone, were each entitled to half of the family tax benefit paid in respect of their two children in the 2005 and 2006 income tax years and substituted a decision that Ms Grimstone solely was entitled to that benefit during that period.

2.I should say at the outset that whatever the relationship had earlier existed between Mr Smith and Ms Grimstone has entirely dissipated such that each unhelpfully punctuated their evidence with insults directed to the other. The mutual animosity even extended to an inability to agree upon which documents ought constitute the documents forwarded to the Tribunal by the Secretary pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth). As a result the Secretary was required to prepare one set of documents for Mr Smith and another for Ms Grimstone.

3.Having regard to the attitudes of Mr Smith and Ms Grimstone and the fundamental obligation of the Tribunal to act only on evidence available to all parties I departed from the usual practice of the Tribunal and did not make the s 37 documents evidence. Instead, I invited each of Mr Smith and Ms Grimstone to adopt, with any necessary qualification or amplification, the evidence recorded as having been given by them to the Social Security Appeals Tribunal and to comment on the correctness or otherwise of the evidence recorded by the Social Security Appeals Tribunal as having been given by the other.

4.The critical issue in the case concerns the care of the children of the relationship, a daughter born in September 2001 and a son born in November 2004, during the period from 1 July 2004 to 30 June 2006. 

5.Mr Smith says that during that period he had at least equal responsibility with Ms Grimstone for the care of the children. Ms Grimstone says that she alone had that responsibility. Mr McQuinlan, who appeared for the Secretary, supported the submission of Ms Grimstone. He also submitted that the evidence was capable of supporting a conclusion that for most of the period in question Mr Smith and Ms Grimstone were “members of a couple” as that expression is used in s 26 of the A New Tax System (Family Assistance) Act 1999 (Cth) (the Family Assistance Act).

6.That latter argument may be disposed of readily. The section has the effect that, where two parties are members of a couple, family tax benefits are payable only to one of them. Mr Smith accepted the suggestion put to him by Mr McQuinlan that he regarded himself as being a member of a couple with Ms Grimstone. On the basis of this admission Mr McQuinlan submitted that s 26 of the Family Assistance Act operated to defeat Mr Smith’s claim.

7.I am unable to accept the argument. The expression “member of a couple” has a particular meaning in the legislation. It is an opinion to be reached having regard to the totality of a relationship. I would not regard Mr Smith’s subjective view as amounting to proof of the objective fact of such a relationship.

8.Part 3 of the Family Assistance Act deals with matters of eligibility for family tax benefit. By virtue of s 21(1) of that Act eligibility is dependant upon the individual having at least one “FTB child”. Section 22 sets out the variety of circumstances where a person may be an FTB child of another. The only circumstances that could have any possible relevance here are those set out in ss 22(2) and (4) of the Family Assistance Act. Those subsections provide:

“(2)The individual is an FTB child of the adult if:

(a)the individual is aged under 18; and

(b)the adult is legally responsible (whether alone or jointly with someone else) for the day‑to‑day care, welfare and development of the individual; and

(c)the individual is in the adult’s care; and

(d)the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult.

…

(4)The individual is an FTB child of the adult if:

(a)the individual is aged under 18; and

(b)the individual is in the adult’s care; and

(c)the individual is not in the care of anyone with the legal responsibility for the day‑to‑day care, welfare and development of the individual; and

(d)the individual is an Australian resident, is a special category visa holder residing in Australia or is living with the adult.”

9.Section 22(4) cannot have any application here because even if the children were in the care of Mr Smith, an issue discussed below, they were most certainly also in the care of Ms Grimstone. Thus the element in s 22(4)(c) of not being in the care of another cannot be satisfied.

10.The first issue for determination then is whether the children were in the care of Mr Smith. That issue is to be decided by reference, principally, to the evidence of Mr Smith and Ms Grimstone. The evidence of both of them was, in many respects, unsatisfactory.

11.From about July 2003 Mr Smith and Ms Grimstone lived at a house owned by them at Gunalda. The property was acquired by them initially as joint tenants with contributions from each of them to the purchase price. Ms Grimstone appears to have contributed the major part of the funds for the purchase. At some time after completion of the purchase Ms Grimstone severed the joint tenancy and the property is now held by them as tenants in common in equal shares. Mr Smith ceased living at Gunalda in May 2006. I need not make any findings about the circumstances of his departure beyond the fact that it was acrimonious. It can be said with confidence that thereafter he had no care of either of the children after his departure.

12.The evidence regarding the period prior to Mr Smith’s departure is less clear. Mr Smith had his own bedroom, and on the basis of Ms Grimstone’s evidence, which on this point I accept, provided his own food. Ms Grimstone said that he had nothing at all to do with the children. I am unable to accept that this was so, not by reference to Mr Smith’s evidence, about which I have grave reservations, but by reference to the evidence of Mr Hart, a friend and frequent visitor, and Ms Grimstone’s own evidence. Mr Hart’s evidence, which was not challenged, was that he had observed Mr Smith engaged in domestic tasks in connection with the children. Moreover Ms Grimstone accepted that when she was in hospital in November 2004 for the birth of the son Mr Smith looked after the daughter (and, I infer Ms Grimstone’s other children) for a period of just under two weeks. It seems improbable to me that Mr Smith would undertake that care, or that Ms Grimstone would trust him to do so, if he had had no care whatsoever of the children otherwise.

13.Mr Smith contended that he had at least equal responsibility for the care of the children. I do not accept that, however I am satisfied that he had sufficient responsibility in the period from July 2004 to May 2006 for the children to be said to have been in his care during this period. I reach that conclusion on the basis that the evidence demonstrates that he undertook some “care” functions on occasions, and on the basis that I infer that his membership of the household was sufficient in itself to impose on him a function of care for the children. For all of that I am satisfied that Ms Grimstone had the major responsibility for the care of the children, but that is a different issue to that which I am here considering.

14.On the basis of this finding I am satisfied that the children each answered the description of “FTB child” in relation to Mr Smith during the period up to his departure in May 2006. 

15.But because I am also satisfied that the children answered that description in relation to Ms Grimstone it becomes necessary to consider s 22(7) of the Family Assistance Act. That provides:

“(7)If:

(a)the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual under subsection (2), (3), (4), (5) or (6); and

(b)one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and

(c)subsection 25(1), (1A) or (1B) does not require that the child be taken not to be an FTB child of that individual for any part of that period;

the child is to be taken to be an FTB child of that individual for the purposes of this section on each day in that period, whether or not the child was in that individual’s care on that day.”

16.Given the terms of s 22(7)(c) of the Family Assistance Act it is, as well, relevant to have regard to s 25(1) of that Act. It is in these terms:

“(1)If:

(a)the Secretary is satisfied there has been, or will be, a pattern of care for an individual (the child) over a period such that, for the whole, or for parts (including different parts), of the period, the child was, or will be, an FTB child of more than one other individual in accordance with subsection 22(2), (3), (4), (5) or (6); and

(b)one of those other individuals makes, or has made, a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in that period; and

(c)the Secretary is satisfied that the child was, or will be, in the care of that last‑mentioned individual for less than 10% of that period;

the child is to be taken, despite that subsection, not to be an FTB child of that last‑mentioned individual for any part of that period.”

17.Both of these provisions focus upon the notion of a “pattern of care”. That expression is not defined by the Act but it is the subject of discussion in the Secretary’s policy manual, the Family Assistance Guide. The Guide, at paragraph 2.1.1.45, describes the task of determining a pattern of care in this way:

“Where the carers do not agree on the actual pattern of care for the child, the [Family Assistance Office] must determine the actual pattern of care on the basis of available evidence. This applies even if a family law order, registered parenting plan or court order exists. If the carers do not agree on the care arrangements each carer should be asked to provide additional evidence to support their declared arrangements in order for the FAO to make a decision as to the actual pattern of care. Examples of evidence, which may be provided by the carers, are outlined in 2.1.1.30 Shared Care Verification of Care Arrangements.”

18.Kiefel J commented on the meaning of “pattern of care” in Wade v Secretary, Department of Family and Community Services[1]in this way:

“[31] The ‘pattern of care’ referred to in the Guidelines has two aspects, it seems to me. In the first place it reflects the care arrangements agreed between the parties or involves a finding which has regard to the actual care arrangements for the child. It is said that ‘as much as possible’ the pattern of care should be the pattern agreed. That was the course taken here. The pattern of care is also used as the basis for the calculation of percentage in para 2.1.1.50. Although they are expressed as the respective party's ‘days of care’ under para 2.1.1.45, which are to be divided by the number of days in the period in question, the Guidelines permit more than one method of assessing those days. Relevantly one is to calculate the number of hours of care and aggregate them.”

[1] (2004) 139 FCR 285 at 291, [31].

19.The present situation is not the usual situation for disputers of this kind, however the Guide contemplates the situation by saying, at paragraph 2.1.1.25:

“A couple who have separated, but are still sharing a home can share their care of an FTB child. Assessing the FTB eligibility for each person should be the same as for any other shared care case. Before the separation, one of the parents would have been the primary carer. The extent to which the care arrangements have changed since the separation occurred should be considered.”

20.Whilst I am satisfied that Mr Smith had some responsibility for the care of the children I am simply not satisfied that the children were, in a quantitative sense, in his care for 10% or more of the relevant period. I regard Mr Smith’s evidence of the extent of the care provided by him as unreliable and demonstrably so. By way of an example, Mr Smith said that the daughter spent much of most days in the orchard on the property with him. It is an improbable notion in itself that a child aged between 2 and 4 years would do so but Mr Hart, whose evidence I accept, said that it had never occurred on the many occasions that he had visited and that the area was too steep for children in any event.

21.Some attention was paid to financial matters at the hearing. Mr Smith had a very modest income. One of the sources was, he said, the sale of property left to him as bequests however it transpires that the same property that he says that he sold has more recently been listed by him in family law proceedings as still owned by him. 

22.I am left to conclude that Mr Smith undertook only occasional tasks that amounted to care of the children, and that such acceptable evidence as there is supports a finding that the children were in Mr Smith’s care for less than 10% of the period. It follows that I am satisfied that the condition in s 25(1)(c) of the Family Assistance Act is made out and that accordingly the children were not FTB children of Mr Smith at any relevant time.

23.I would affirm the decision under review.

I certify that the 23 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC

Signed:
           .....................Signed..............................................
  Jacqueline Woods, Associate

Date of Hearing  1 February 2008
Date of Decision  15 February 2008
Applicant  Self represented

Respondent  Advocate, Centrelink Legal Services
Joined party  Self represented