Somers & Somers
[2013] FCCA 162
•3 May 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SOMERS & SOMERS | [2013] FCCA 162 |
| Catchwords: CHILD SUPPORT – Child Support Agreement – application for enforcement of child support agreement – where respondent contends that child support agreement has been terminated – where parties have three children – where one child attained the age of 18 years during the currency of the proceedings. CHILD SUPPORT – Departure Application – where Applicant seeks Departure Order in the alternative to Child Support Agreement – cross application by Respondent for Departure Order. |
| Legislation: Child Support Legislation Amendment (Reform of the Child Support Scheme – New Formula and Other Measures) Act 2006 (Cth) |
| Cases cited: Daley & Daley [2009] FMCAfam 398; (2009) 41 Fam LR 351; FLC 98-039 Leroy & Moreau [2010] FMCAfam 903 |
| Applicant: | MS SOMERS |
| Respondent: | MR SOMERS |
| File Number: | SYC 3026 of 2008 |
| Judgment of: | Judge Scarlett |
| Hearing dates: | 18 November 2010, 5 August, 2 December 2011 |
| Date of Last Submission: | 21 December 2011 |
| Delivered at: | Sydney |
| Delivered on: | 3 May 2013 |
REPRESENTATION
| Counsel for the Applicant: | The Applicant appeared in person |
| Solicitors for the Applicant: | Karras Partners Lawyers (until 5 August 2011) |
| Counsel for the Respondent: | Mr Lethbridge SC |
| Solicitors for the Respondent: | Slade Manwaring Solicitors |
ORDERS
The Court declares that the Child Support Agreement entered into by the Applicant and the Respondent on 2 November 2005 remains in force in respect of the children [Y] and [Z].
The Court declares that the Child Support Agreement entered into by the Applicant and the Respondent on 2 November 2005 has been terminated in respect of [X] with effect from 15 March 2011.
The Applicant is to file and serve an affidavit setting out details of the arrears currently claimed under the Enforcement Summons filed on 12 March 2010 within 21 days.
The Respondent is given leave to file and serve any affidavit setting out the facts upon which he seeks to rely in respect of the claimed arrears within a further period of 14 days.
If either party seeks to press an order for costs that party is to file and serve an affidavit setting out details of the costs and disbursements claimed within 28 days.
The proceedings are otherwise adjourned to Monday 17 June 2013 for further mention at 10:00 am.
IT IS NOTED that publication of this judgment under the pseudonym Somers & Somers is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 3026 of 2008
| MS SOMERS |
Applicant
And
| MR SOMERS |
Respondent
REASONS FOR JUDGMENT
Application
This is an Application by the mother to enforce a child support agreement to provide support for the parties’ children, [X], [Y] and [Z]. In the alternative, the mother seeks a departure Order.
The Respondent father denies that he has an obligation under the Agreement, which he asserts has been terminated. He, too, seeks a departure Order.
Background
The parties were married [in] 1989. They separated on 10 May 2004 and were divorced on 24 March 2006.
There are three children of the marriage.
[X] was born [in] 1993. He is now an adult, as he is twenty years old.
[Y] was born [in] 1996. He is now aged 16 years and [omitted] months
[Z] was born [in] 1999. She is 13 years and [omitted] months old.
The children live primarily with their mother, the Applicant, and spend time with their father, the Respondent, from Thursday afternoon until Tuesday morning each alternate week during the school term and half of each of the school holidays.
On 2 November 2005 the parties entered into a Child Support Agreement. The Agreement was registered with the Child Support Agency on 14 June 2006.
On 12 June 2008 the parties entered into Consent Orders in the Family Court of Australia at Sydney, providing that:
a)the parties would each sign all documents necessary for the children to obtain passports; and
b)either party may take the children out of Australia for a holiday on certain conditions.
On 13 January 2009 the parties entered into final Consent Orders providing that:
a)The parties should have equal shared parental responsibility for the children;
b)The children would live with their father for half of each school holidays;
c)The children would spend equal periods of time with each parent over Christmas Eve and Christmas Day each year;
d)The children would spend alternate Easter long weekends with each parent;
e)The children would have the opportunity to spend their birthdays with each parent;
f)The children would spend Mother’s Day with their mother and Father’s Day with their father;
g)The parties would notify each other of any illness, accident or injury as soon as possible and not later than 12 hours after the occurrence;
h)The parties would keep each other informed of any medical treatment required by any of the children;
i)The parties would notify each other about any communication from each of the children’s schools;
j)Neither party would arrange for the children to attend any social or sporting event in the other’s time without the other’s consent;
k)Neither party would take the children out of New South Wales or out of Australia without each other’s written consent;
l)If either party should be out of the State or out of Australia for more than 2 consecutive nights during their time with the children they should inform the other parent and offer the other parent the opportunity the first opportunity to care for the children in their absence.
The Applicant is a [occupation omitted]. Between 26 April and 10 May 2009 she was out of Australia on a trip that was largely in the course of her employment. During that time the children were in the care of the Respondent. As a result, they remained in his care for an additional 9 nights over the time that they would normally have been living with him.
There is no issue between the parties that this absence from Australia by the Applicant led to the children spending more than 40% of the 2008/2009 child support year with their father. The percentage of time that the children spent with each parent was 58% with the Applicant and 42% with the Respondent.
On 12 March 2010 the Applicant commenced proceedings to enforce the Agreement by way of an Enforcement Summons, requiring the Respondent to pay an amount of arrears under the agreement, in the amount of $14,929.60 and continuing.
In her affidavit in support, sworn on 10 March 2010, the Applicant deposed that:
a)the parties’ son [X] has special needs and as a consequence specific provisions were made for him in Clause 4.9[1] of the Agreement;
b)the parties had previously been involved in disputes in relation to the amount of child support payable under the Agreement, as a result of which they attended before a mediator and the Applicant agreed to accept a reduced sum of $422.80 per week for nanny expenses under Clause 4.11[2] of the Agreement;
c)the amount outstanding as a result of the Respondent’s failure to observe the terms of the Agreement was $16,937.05 as at 31 January 2010;
d)the Respondent made a part payment after that date which reduced the amount outstanding to $14,929.60;
e)the Applicant was aware that the Respondent disputed that he had obligations under the Agreement because he contended that it had been terminated, which she rejected.
[1] Clause 4.9 of the Agreement states: “The liable parent shall pay or cause to be paid the costs of a Teacher’s Aide or other teaching/special needs support in respect of [X]”.
[2] Clause 4.11 states: “The liable parent shall pay to the carer the cost of employing a nanny for the children to a maximum cost of $600.00 per week for a period of 6 years from the date of this Agreement”
The Enforcement Summons was returnable on 4 May 2010, on which date it was listed for hearing on 8 June 2010.
The Respondent filed an Application in a Case the following day, in which he sought the following Orders:
1. A declaration that the Child Support Agreement entered into between the Father and the Mother on about 2 November 2005 has been terminated.
2. Orders enabling an accounting of monies overpaid by the Father to the Mother as and from the date upon which the Child Support Agreement was terminated (“the over payment”).
3. That the Mother repay to the Father the over payment.
4. That the Court stay the Enforcement Summons filed by the Mother on 12 March 2010 (“the Enforcement Summons”) pending final hearing of this matter.
5. In the alternate that the Enforcement Summons be and is hereby dismissed.
6. Costs
The Application was accompanied by an affidavit of the Respondent sworn 3 May 2010, in which he deposed that:
a)he married his current wife, Ms S, on [omitted] 2007;
b)at the time that he and the Applicant entered into the Agreement, the children were spending time with him during the school term from after school on Friday until Sunday afternoon on alternate weekends;
c)in about late 2006 the children began spending time with him from Thursday afternoon to Tuesday morning on alternate weekends, as well as half the school holidays;
d)notwithstanding the change in the parenting arrangements he had continued to pay child support, which was currently $599.10 per week, in accordance with an annual letter from the Child Support Agency;
e)until the 2009/2010 Christmas school holidays he also paid a weekly sum of about $422.00 per week intended to be for the nanny fees;
f)he continues to pay for school fees, school uniforms totalling approximately $30,000.00 per annum for each of [X] and [Y] and approximately $25,000.00 for [Z];
g)he also continues to pay health insurance, medical and chemist expenses and dental and orthodontic work for [X] which he estimated to have cost approximately $15,000.00; and
h)he intends to continue to provide for his children’s needs.
The Respondent referred in his affidavit to the time the children have been spending with him since the parties entered into the Agreement in these terms:
6. At the time we entered into the Child Support Agreement the children spent time with me during school term from Friday after school to Sunday afternoon each alternate weekend.
7. In about late 2006 the children began spending from Thursday afternoon to Tuesday morning each alternate weekend with me. They have also continued to spend half of each school holiday period with me. There has also been additional time as agreed. Indeed, in the 2008/2009 child support year the children spent more than 40% of the nights in my care.
8. On 13 January final parenting Consent Orders were made in relation to [X], [Y] and [Z] dealing largely with my holiday time with the children. Annexed to this Affidavit and marked “B” is a copy of those Orders.
9. Notwithstanding the significant changes to the parenting arrangements from the time of entering into the Child Support Agreement I have continued to pay Ms Somers child support. I am currently paying her about $599.10 per week which I pay by direct debit every Thursday. Each year I receive a letter from the Child Support Agency advising of the payment which includes the CPI adjustment provided for in the Child Support Agreement. The amount I currently pay is in accordance with the most recent letter.[3]
[3] Affidavit of Mr Somers 3.5.2010 at paragraphs [6]-[9]
The Respondent filed a further affidavit on 4 June 2010, sworn on 3 June, in which he deposed that:
a)in the 2008/2009 child support year the children spent more than 40% of the nights of the year in his care;
b)he annexed a calendar setting out the nights that the children had spent in his care during the year;
c)he asserted that the Child Support Agreement was “a source of continual, constant and unpleasant disagreement” between the Applicant and himself.[4]
[4] Affidavit of Mr Somers 3.6.2010 at paragraph [6]
The Respondent went on to depose:
Ms Somers’s and mine Child Support Agreement was terminated as a result of the children spending so much time with me and indeed more than 40% of the bed nights with me.[5]
[5] Ibid at [8]
On 8 June 2010, when the Enforcement Summons was listed for hearing, Mr Schonell of counsel[6] appeared for the Applicant and
Ms Boyle of counsel appeared for the Respondent. An Application was filed in Court seeking a Departure Order.
[6] As he then was
The Court was told that the proceedings would take approximately a day and a half to hear. The parties’ competing claims were:
a)whether the Child Support Agreement is still on foot;
b)if the Agreement is still on foot, what arrears exist?
c)the Respondent claims that the Applicant owes him money; and
d)if the Child Support Agreement is still on foot, the Applicant seeks a Departure Order.
The proceedings were listed for hearing on 18 and 19 November 2010.
The Application is somewhat garbled in that it duplicates some of the Orders sought. For example, there are two orders both numbered 1. It appears to me that the Application seeks the following Orders:
1. That the Child Support Agreement entered into by the parties on 2 November, 2005 has not been terminated and remains valid and enforceable.
2. That the husband’s Application for accounting and repayment of monies alleged to have been overpaid, be dismissed.
3. In the alternative to the Declaration sought in paragraph 1 hereof, and pursuant to Section 139 of the Child Support (Assessment) Act 1989 (“the Act”) there be an Order for the payment of child support by the husband in relation to the children of the marriage, [X] born [in] 1993, [Y] born [in] 1996 and [Z] born [in] 1999 (“the children”) in the following terms:-
3.1 A periodic sum of $750.00 per week per child, such amount to be indexed annually in accordance with movements in the Consumer Price Index (All Ordinaries) Sydney;
3.2 All education expenses in respect of the attendance by the children at a private school including school fees, uniforms, school books, stationery, music, drama, sports, camps, excursions, computers, levies, including but not limited to IT levies, enrolment fees and non-refundable deposits, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
3.3 The cost of a teacher’s aid[7] or other teaching/special needs support in respect of the child [X], as nominated by the wife, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
[7] sic
3.4 All medical and dental expenses of the children, including expenses in relation to counselling, orthodontic procedures and private hospital fees, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
3.5 All insurance premiums payable in relation to private, medical and hospital insurance at the highest coverage available from time to time, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
3.6 In reimbursement to the wife of a cost of employing a Nanny for the children at the specific rate of $540.00 per week such amount to be indexed annually in accordance with movements in the Consumer Price Index (All Ordinaries) Sydney;
and in the event that any of the children shall attain the age of 18 years during a calendar year in which they are undertaking Year 12 secondary school studies, then the husband’s obligations pursuant to this Order shall continue until 31 December of that year.
4. In the alternative to the Declaration sought in paragraph 1 hereof and pending further Order, an interim Child Support Departure order for the payment of child support by the husband in relation to the children of the marriage, [X] born [in] 1993, [Y] born [in] 1996 and [Z] born [in] 1999 (“the children”) in the following terms:-
4.1 A periodic sum of $750.00 per week per child, such amount to be indexed annually in accordance with movements in the Consumer Price Index (All Ordinaries) Sydney;
4.2 All education expenses in respect of the attendance by the children at a private school including school fees, uniforms, school books, stationery, music, drama, sports, camps, excursions, computers, levies, including but not limited to IT levies, enrolment fees and non-refundable deposits, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
4.3 The cost of a teacher’s aid[8] or other teaching/special needs support in respect of the child [X], as nominated by the wife, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
4.4 All medical and dental expenses of the children, including expenses in relation to counselling, orthodontic procedures and private hospital fees, such payments to b e made within 28 days of any tax invoice or receipt provided to the husband;
4.5 All insurance premiums payable in relation to private, medical and hospital insurance at the highest coverage available from time to time, such payments to be made within 28 days of any tax invoice or receipt provided to the husband;
4.6 In reimbursement to the wife of the cost of employing a Nanny for the children at the specific rate of $540.00 per week such amount to be indexed annually in accordance with movements in the Consumer Price Index (All Ordinaries) Sydney;
and in the event that any of the children shall attain the age of 18 years during a calendar year in which they are undertaking Year 12 secondary school studies, then the husband’s obligations pursuant to this Order shall continue until 31 December of that year.
[8] sic
On 27 August 2010 the Applicant filed a copy of the relevant Child Support Assessment for the Assessment period 1 January 2010 to 7 June 2010.
On 7 October 2010 the parties entered into Consent Orders providing that:
a)the Respondent was permitted to take the children out of Australia for a holiday in Europe from 9 to 29 January 2011;
b)that the children should spend time with the Respondent from 8 to 29 January 2011 to coincide with the holiday;
c)the Respondent was to provide the Applicant with an itinerary of the proposed holiday;
d)the Respondent was to provide the child [X] with a mobile telephone with international roaming capabilities for the duration of the holiday;
e)the children would live with the Applicant from 8 to 29 January 2012 for the purpose of a holiday;
f)[X] was to undertake two 2 hourly sessions per week at either:
i)[omitted] School with an available primary school teacher; or
ii)At the mother’s home with a Mr L; or
iii)Such other tutor as the parties agreed;
For each of the remaining school terms for 2010 and 2011;
g)each party was entitled to communicate with, make enquiries of and facilitate the tutoring sessions;
h)the parties were each to pay half of the costs of the tutoring sessions; and
i)no order for costs.
The Consent Orders contained these Notations, which are quoted in full:
A. The additional time the children spend with the Father pursuant to the above is irrelevant for child support purposes.
B. That the final hearing of the Child Support issues is listed for hearing on 18 and 19 November 2010 and the issue of payment of the tutoring sessions will be dealt with at that time.
C. That the consent orders made 13 January 2009 and 12 June 2008 otherwise remain in place.
On 3 November 2010 the Respondent filed a Response to the Applicant’s Application of 18 June 2010. In the Response, the Respondent seeks the following Orders:
1. That a Declaration be made that the Child Support Agreement dated 2 November 2005 was terminated as at 30 June 2009.
2. Orders enabling an accounting of monies overpaid by the Father to the Mother as and from the date upon which the Child Support Agreement was terminated (“the over payment”).
3. That the Mother repay to the Father the over payment.
4. That the Enforcement Summons filed on behalf of the Applicant Mother on 12 March 2010 be and is hereby dismissed.
5. That a child support Departure Order for the payment by the Respondent Father of child support in relation to the children [X] born [in] 1993, [Y] born [in] and [Z] born [in] 1999 (“the children”) be made in the following terms:
5.1 A periodic sum of $200.00 per child per week, such amount to be indexed annually in accordance with movements in the Consumer Price Index Sydney (or groups) published by the Australian Bureau of Statistics (CPI);
5.2 All educational expenses for the children including tuition fees, books, school uniforms, books, school uniforms and otherwise any additional amounts as may be agreed between the parties;
5.3 All insurance premiums payable in relation to private, medical and hospital insurance at the highest coverage;
5.4 All medical and dental expenses of the children, including expenses in relation to orthodontic procedures and private hospital fees and otherwise any other or further expenses as may be agreed between the parties, such payments to be made within 28 days of any tax invoice or receipt received by the Husband.
6. That order 5 is conditional upon the Respondent Father being in paid employment on a commensurate salary to that which he is currently in receipt of.
7. Costs.
The Respondent filed an affidavit in support of his Response sworn on 3 November 2010. In that affidavit he reiterated his earlier claim that the Child Support Agreement had been the source of regular disagreements between the Applicant and himself. He set out various instances of disagreements between them which, whilst they illustrate the animosity between the parties, are not relevant to the matters the Court has to decide.
The Respondent set out at paragraph [9] of his affidavit:
Ms Somers recently proposed, and I have been more than happy to agree, that [X] and [Y] live with Ms S and I now. We have since further discussed that in 2012 and thereafter, following completion of his secondary schooling, [X] will come and live with us.[9]
[9] Affidavit of Mr Somers 3.11.2010 at [9]
The Respondent set out his current circumstances:
a)He has remarried;
b)His gross salary for the 2008/2009 financial year was $641,000.00;
c)His gross salary for the 2009/2010 financial year was $629,000.00;
d)He and his current wife purchased a house in [omitted] for $2,3000.00.00;
e)The balance owing on the mortgage over the property was $1,301,900.00;
f)His wife is a student and not in paid employment;
g)His wife has four adult children, two of whom are full-time students and financially dependant on their mother and him.
The Respondent denies the Applicant’s claim that he owes arrears of tutoring expenses under the Child Support Agreement, saying:
Even if the Agreement had not been terminated, I disagree that there is an obligation to pay.[10]
[10] Affidavit of Mr Somers 3.11.2010 at paragraph [20]
He also denies the Applicant’s claims of arrears of computer costs in the sum of $3,520.00 under the Agreement, saying:
Even if the Agreement had not been terminated, I disagree that these arrears are valid.[11]
[11] Ibid at [23]
The Respondent denied that he owed arrears of nanny expenses totalling $3,520.00, again saying:
Even if the Agreement had not been terminated, I disagree that these arrears are valid.[12]
[12] Ibid at [26]
Under the heading “Current child support I pay” the Respondent set out details of the amounts he claims to pay for the children:
a)Private school fees for the three children, including “tuition fees, excursions, levies, music, sporting costs, books, uniforms and sports kit”, the total costs of which he estimates at approximately $85,000.00 per annum;[13]
b)Medical insurance with HCF at the highest level;[14]
c)All the children’s medical, dental, specialist and hospital costs, which he estimated at $25,000.00 per annum;[15] and
d)Child support of $200.00 per child per week.[16]
[13] Ibid at [29]
[14] Ibid at [30]
[15] Ibid at [31]
[16] Ibid at [32]
The Respondent deposed that he paid $422.00 per week towards the cost of a nanny for the children until the end of 2009.
Although the case was listed for hearing on 18 and 19 November 2010, it did not proceed to finality, because senior counsel for the Respondent was ill in hospital. The Respondent sought an adjournment due to the inability to brief other counsel at short notice. Mr Karras, solicitor for the Applicant, submitted that the parties should prepare written submissions on the issue of whether or not there was a valid child support agreement still in force. Mr Holmes, who appeared for the Respondent, submitted that there was another leg to the Respondent’s argument that may not be appropriate for written submissions, which was the discretionary power the Court has to exercise the power to enforce, which would also be the subject of some contested argument and may well need some cross-examination of the parties.
Mr Karras told the Court:
I should say, so there is no misunderstanding, the only part that I am contending should be dealt with by way of submissions is that neat point under 84(3), which is whether or not an event can be specified as a terminating event, as opposed to a date being specified as a terminating event.[17]
[17] Transcript 18.10.2010 page 7 lines 40-43
The matter was stood out of the list, with liberty to restore on seven days notice.
On 14 February 2011, the Applicant filed an Application in a case, seeking that the proceedings be re-listed before the Court.
The child [X] turned 18 on [omitted] 2011. However, as he was still attending school and would do so until 8 December of that year, on 11 March 2011 the Child Support Agency wrote to the Applicant and advised her that the Agency had accepted an application to extend the child support assessment after [X] turned 18 and that the assessment would remain in place until the last day of his school year, being 8 December 2011.[18]
[18] Ms Somers Child Support for [X] 18 affidavit 11.9.2011 Annexure “F”
Subsequently, the Agency advised the Applicant that this decision was an error, as the Respondent had not indicated his consent. The Agency later issued an administrative assessment in respect of [X].
On 16 March 2011 the proceedings were listed for final hearing on 5 August 2011.
The Applicant filed an updating affidavit on 3 August 2011, in which she set out details of the arrears of child support that she claimed under the Child Support Agreement as $49,213.40, although the Court was told that an amount of $1,219.20 for the parties’ child [X], referred to in paragraph [2] of the affidavit had since been paid. Thus, the arrears claimed were reduced to $47,994.20.
In her affidavit, the Applicant denied that an agreement was reached between the parties that the two boys would live with the Respondent in 2011 or that [X] would live with the Respondent in 2012.[19] She further deposed that:
59. For the child support year ending June 2009 the Respondent cared for the children for an additional 9 nights due to my absence for work overseas.
60. For the child support year ending June 2010 the children were cared for by me for 63% of the child support year.
61. For the child support year ending June 2011 the children were cared for by me for 61% of the child support year.[20]
[19] Affidavit of Ms Somers 3.8.2011 at paragraph [13]
[20] Affidavit of Ms Somers 3.8.2011 at [59]-[61]
The Court was told that the Applicant’s solicitor’s instructions had been withdrawn and Mr Karras was granted leave to withdraw.
The Respondent’s Case Outline contained at Part E a Minute of Orders sought by the Respondent, which differed from the Orders sought in the Response filed on 3 November the year before. The Orders sought by the Respondent are:
1. A declaration that the Child Support Agreement dated 2 November 2005 (“the Agreement”) was terminated by operation of the provisions of paragraph 4.12.4 of the Agreement on 30 June 2009.
2. In the alternative to the declaration sought in paragraph 1 above, a declaration that the Agreement was terminated in relation to the child [X] by operation of paragraph 4.12.1 and/or 4.12.2 of the Agreement on 13 January 2009.
3. An Order for the taking of accounts to determine the money over-paid by the Father to the Mother, if any, as and from the date upon which the Agreement was terminated to the date of the making of these Orders where that over-payment must be calculated by calculating the difference between the amount paid by the Father for child support, all forms, and the amount he would have paid if the Departure Orders set out below in these orders had commenced to have effect from 1 July 2009, or alternative, 14 January 2009.
4. That the Enforcement Summons filed on behalf of the Applicant Mother on 12 March 2010 be and is hereby dismissed.
5. That a child support Departure Order for the payment by the Respondent Father of child support in relation to the children [X] born [in] 1993, [Y] born [in] 1996 and [Z] born [in] 1999 (“the children”) be made in the following terms:
a. A periodic amount of $200.00 per child per week, such amount to be indexed annually in accordance with movements in the Consumer Price Index Sydney (or groups) published by the Australian Bureau of Statistics (CPI);
b. Private school fees for each child comprising tuition fees, book fees, school uniforms at each child’s present school or any alternate school previously agreed in writing between the parties, together with in the case of each child, an additional amount for schooling or school-related expenses previously agreed between the parties in writing;
c. Private, medical and hospital insurance premiums at the highest level of family coverage available at the Father’s insurer of choice;
d. All additional medical and hospital expenses, and all dental expenses, in excess of the insured amount for procedures previously agreed to by the Father.
6. That the payments by way of periodic child support provide in Order 5(a) and the provisions for non-agency payments provide in Order 5(b), (c) and (d) continue until each child completes secondary education or reaches the age of 18 years, whichever, in the case of each child, is the latter.
7. That in the event that the Court makes an order in terms of paragraph 2 above, then orders in terms of paragraph 5 above with respect to [X] born [in] 1993 only.
8. Costs.
The Hearing
The Applicant gave oral evidence and was cross-examined on 5 August 2011. The Respondent filed in Court on the day of the hearing an updating affidavit sworn on 1 August 2011.
In his affidavit, the Respondent deposed that he was continuing to pay child support according to the current assessment at the rate of $408.87 per week. As to [X], he deposed:
[X] turned 18 years of age on [date omitted] 2011. Therefore, the assessment now relates only to [Y] and [Z]. [X] is however still in secondary school and so I am continuing to pay child support in relation to [X]. The total periodic amount I am therefore paying to Ms Somers for the three children is $615.27 per week.[21]
[21] Affidavit of Mr Somers 1.8.2011 at paragraph [5]
The proceedings were part-heard. The hearing did not resume until 2 December 2011, due to judicial unavailability. On that date, the Respondent gave oral evidence and was cross-examined by the Applicant.
In the intervening period, the Applicant filed an Amended Application, a Case Summary and a number of affidavits. Three affidavits, all by the Applicant, were objected to and not read.
The Applicant relied on the affidavits of:
a)Mr L, affirmed on an unspecified date in August 2011;
b)Mr S, sworn on 19 August 2011;
c)Eight affidavits by the Applicant, all sworn on 11 September 2011; and
d)Ms I affirmed 27 August 2011;
e)Ms R sworn 23 August 2011;
f)Ms C sworn on 28 August 2011; and
g)Mr M on an unspecified date in August 2011.
Mr L and Mr S each deposed that they had provided tutoring services for [X] in 2008/2009 and 2010 respectively. They were not required for cross-examination.
Ms I deposed that from 2006 to 2010 she attended at the Applicant’s home and cared for the three children whilst the Applicant was at work. She was not required for cross-examination.
Ms R and Ms C each deposed that they had attended at the Applicant’s home and cared for the children, Ms R between 2005 and 2010 and
Ms C from 26 February 2010 until the date of her affidavit.
Ms R and Ms C were not required for cross-examination.
Mr M is the Applicant’s father. He deposed in his affidavit that at short notice in July and August 2006 he travelled from his home in Adelaide at his daughter’s request to care for the children whilst she was recruiting a suitable carer for the children.
Again, he travelled from Adelaide to Sydney to assist with the care of his grandchildren. During the time he stayed in Sydney the Applicant hired a vehicle for him to use to collect the children from school and take them to and collect them from various activities.[22]
[22] Affidavit of Mr M August 2011 at [5]-[6]
Mr M was not required for cross-examination.
The Applicant’s own affidavits of 11 September dealt with the following subject matter:
a)the number of nights that the children resided or would reside with the Applicant and the Respondent in 2011 (219 with the Applicant, 146 with the Respondent);
b)costs matters:
i)the amount of the Applicant’s legal costs drawn from her home loan,
ii)the number of days’ leave that she had to take from work at a cost of $3,500.00;
iii)the amount of $1,1097.00 which she had to pay for transcripts of the hearings on 18 November 2010 and 5 August 2011;
iv)expenses of purchasing new computers from the children;
v)costs of care for the children, including hire of a motor car, air fares for her father to travel to from Adelaide and return, fees for a temporary nanny and other matters.
vi)a letter from the Child Support Agency dated 8 February 2008 relating to a review of the parties’ Child Support Agreement, saying “We are writing to advise you that your child support agreement made with Mr Somers for [Z], [Y] and [X] for the period 2 March 2006 to [omitted] 2017, has been reviewed by the Child Support Agency (CSA) and will continue after 30 June 2008”[23] ;
vii)payments by the Respondent to the Applicant of $422.80 for costs of a nanny, which ceased on 19 November 2009;
viii)correspondence from the Child Support Agency and accounts of email correspondence and a telephone conversation with the Respondent on 10 March 2010 relating to the fact that [X] would reach the age of 18 years on 15 March 2011[24]; and
ix)details of her salary and working conditions and details of the Respondent’s gross salary for the 2009, 2010 and 2011 financial years.
[23] Ms Somers Child Support Agency review affidavit 11.9.2011 Annexure “A”
[24] Although at paragraph [5] the Applicant deposes that a conversation took place on 10 March 2010 but this is an obvious clerical error and no point was taken by the Respondent.
The Applicant also filed in Court on the day of the hearing a further affidavit sworn on 30 November 2011. Counsel for the Respondent objected to part of the affidavit but the balance of the affidavit set out the applicant’s updated financial position:
a)Her mortgage balance was $248,000.00;
b)She claimed the arrears were:
(a) unpaid nanny arrears following mediation $536;
(b) unpaid tutor arrears $6,300;
(c) unpaid computer expenses $3,529,
Sub total: $10,365
5. Costs of child care being:
(a) 102 weeks (19 November 2009 to 2 December 2011) at $540 per week being $55,080; or
(b) 106 weeks at $422.80 per week being $44,816 and accruing.[25]
[25] Affidavit of Ms Somers 30.11.2011 at [4]-[5]
The Applicant was not required for cross-examination on her further affidavits.
The Applicant’s Amended Application filed on 12 September 2011 seeks the following Orders:
1. A declaration that the Child Support Agreement entered into by the parties on 2 November 2005 has not been terminated and remains valid and enforceable.
2. That the father’s application for accounting and repayment of monies alleged tom have been overpaid, be dismissed.
3. That the father pay the mother arrears of child support and interest due and owing under the Child Support Agreement within 14 days of the date of the order.
4. In the alternative to the Declaration sought in paragraph 1, and pursuant to Section 139 of the Child Support Assessment, 1989 (“the Act”) there be a child support Departure Order for the payment by the husband of child support in relation to the children of the marriage, [X] born [in] 1993, [Y] born [in] 1996 and [Z] born [in] 1999 (“the children”) in the following terms:-
4.1 A periodic sum of $500.00 per week per child, such amount to be indexed annually in accordance with the movements in the Consumer Price Index (All Ordinaries) Sydney;
4.2 All education expenses in respect of the attendance by the children at a private school including school fees, uniforms, school books, stationery[26], music, drama, sports, camps, excursions, computers, levies, including but not limited to IT levies, enrolment fees and non-refundable deposits, such payments to be made within 28 days of any tax invoice or receipt provided to the father;
4.3 The cost of a Teacher’s Aide[27] or other teaching/special needs support in respect of the child [X], as nominated by the mother, such payments to be made within 28 days of any tax invoice or receipt provided to the father;
4.4 All medical and dental expenses of the children, including expenses in relation to counselling, orthodontic procedures and private hospital fees, such payments to be made within 28 days of any tax invoice or receipt provided to the father;
4.5 All insurance premiums payable in relation to private, medical and hospital insurance at the highest coverage available from time to time, such payments to be made within 28 days of any tax invoice or receipt provided to the father;
[26] Misspelled as “stationary” throughout the Applicant’s case
[27] Misspelled as “aid” throughout the Applicant’s case
and in the event that any of the children shall attain the age of 18 years during a calendar year in which they are undertaking Year 12 secondary school studies, then the father’s obligations pursuant to this Order shall continue until 31 December of that year.
5. That the father pay the legal costs of the mother on an indemnity or solicitor client basis.
At the conclusion of the evidence, Orders were made that the parties were to file and serve written submissions:
a)The Applicant was to file and serve any further written submissions within 7 days;
b)The Respondent was to file and serve written submissions within 14 days from 9 December 2011; and
c)The Applicant was to file any submissions in reply within a further period of 7 days.
Submissions
Both parties relied on their Case Summaries as submissions. Senior counsel for the Respondent forwarded a further submission on 19 December 2011 and the Applicant filed submissions in reply on 21 December 2011.
The following documents have been considered as relevant submissions:
a)Applicant’s Case Summary 17 November 2010;
b)Applicant’s Summary 12 September 2011;
c)Applicant’s Submissions in Reply 21 December 2011;
d)Case outline of the Respondent Father 4 August 2011; and
e)Supplementary Submissions on behalf of the Respondent Father 19 December 2011.
Applicant’s Case Summary 17 November 2010
In the Applicant’s Case Summary of 17 November 2010, the Applicant’s then solicitor, Mr Karras, noted that:
a)The parties entered into a Child Support Agreement on 2 November 2005;
b)The agreement was accepted for registration by the Child Support Agency on 14 June 2006 and is by virtue of the Child Support (Assessment) Act 1989 a binding child support agreement;
c)The Respondent contends that by virtue of a provision in the Agreement found at Clauses 4.4.4 and again at 4.12.4 that the Agreement has terminated;
d)The Respondent contends that by virtue of the provisions the children lived with the carer (i.e. the Applicant) for less than 60% of the nights in a child support year, being the 2008/2009 child support year; and
e)The Applicant accepts that the children resided with the Respondent for more than 40% of the nights in the relevant child support year.
It was submitted that the issues for determination are:
a)Whether the Agreement has been terminated by virtue of the provisions in Clauses 4.4.4 and 4.12.4;
b)If not, the application for enforcement should be heard and determined;
c)If the Agreement has been terminated, then the parties have competing applications for departure from administrative assessment for determination by the Court.
It was further submitted that the provisions in the Agreement do not constitute a terminating event such as to be able to be relied upon for the purposes of terminating the Agreement, and if the applicant were to be unsuccessful on the first ground the Court would find it inequitable and unjust to rely upon the provisions given the conduct and assurance of the Respondent that he would not do so.
Mr Karras in his submission referred the Court to the provisions of s.84 of the Act which provides that an agreement is a child support agreement only if it includes various provisions, the relevant provision being s.84(1)(g):
(g) provisions under which the liability of a party to pay or provide child support for a child to another party is to end from a specified day.
He further referred to subsection 84(3), which provides that:
If the agreement also includes provisions of a kind not referred to in subsection (1), those provisions do not have effect for the purposes of this Act.
Thus, it was submitted that the provisions in 4.4.4 and 4.12.4 do not comply with s.84(1)(g) and are not able to be relied upon as determining the Agreement.
In effect, what is submitted is that the provisions do not refer to a specified day but a specific event and therefore do not comply with s.84(1)(g).
In the alternative, it was submitted that the Court would not exercise its discretion to set the Agreement aside or make the declaration sought on equitable principles, as the Respondent had assured the Applicant that he would not seek to utilise the number of nights as a reason for setting aside the Agreement.
Applicant’s Case Summary 12 September 2011
In her comprehensive Case Summary dated 11 September 2011 and filed on 12 September, the Applicant submitted that the matters for determination by the Court are:
(a) Has the Agreement entered into between the parties been terminated by either the operation of clause 4.4 and 4.12 of the Agreement and if so on what date was the agreement terminated?
(b) Did the Agreement on and from 1 July 2008 constitute a “termination agreement” by reason of the determination of the Child Support Agency on 8 February 2008 that the agreement will continue after 1 July 2008?
(c) Have the requirements of Section 80D of the Act been complied with?
(d) If the Agreement was terminated by reason of the determination on 8 February 2008 upon what date was the agreement terminated?
(e) Has the Agreement been terminated in relation to the child [X] on 13 January 2009 being the date upon which consent parenting orders were entered, when [X] was 15 years of age, and if so upon what basis and upon what date?
(f) Has the Agreement been terminated by reason of the mother’s absence overseas for work for a period of 9 nights or 2% of the child support year ending June 2009 and if so upon what date?
(g) If not, then the wife’s application for enforcement should be heard and the arrears determined.
(h) If the Agreement has been terminated, then each of the parties have ongoing applications for departure from the administrative assessment for determination by the Court. The wife’s application being that found in an Application filed 8 June 2010 and amended in September 2011 and the father’s being found in an Application filed 3 November 2010.
(i) If a departure order is made, upon what date should that order commence, bearing in mind the provisions in sections 111 and 112 of the Act?[28]
[28] Applicant’s Case Summary 12.9.2011 at [6]
The Applicant submitted that from the date of separation in May 2004 until October 2006 that the children lived with her and that they lived with the Respondent for 2 nights each fortnight and 3 weeks holiday each year.
From October 2006 onwards the children have been living with the Applicant for 9 nights per fortnight and half of the school holidays whilst they live with the Respondent for 5 nights a fortnight and the other half of the school holidays. The Applicant contends that this is a 60/40 shared care arrangement but the Respondent disagrees.
The parties entered into Consent Orders on 13 January 2009. The Applicant submits that the Respondent contends that the Agreement was terminated in relation to [X] by virtue of those Orders. The Applicant contends that at no time did the respondent assert or represent that he was entitled to terminate the Agreement in relation to [X] or at all.
The Applicant submits that the Respondent contends that the Agreement was terminated by the events of 26 April to 10 May 2009 when she was overseas in the course of her employment. She states:
18. The father contends that the children lived with the carer for less than 60% of the nights in a child support year. The relevant year in question is the 2008/2009 child support year.
19. The mother accepts that the children resided with the father for 42% of the nights in the relevant child support year, because the father cared for the children for an additional 9 nights while the mother was in Croatia and London working during the period 26 April 2009 to 10 May 2009.[29]
[29] Applicant’s Case Summary 12.9.2011 at [18]-[19]
However, she submits that the terminating provisions in clauses 4.4. and 4.12 are intended to apply to a change in living arrangements of a more permanent nature than 9 additional nights or 2% of the nights in one child support year. She denies that there has been any permanent change in the children’s living arrangements and the circumstances in the 2008/2009 year were a “one off” occasion and not an event or a date sufficient to ground termination of the Agreement.
The Applicant refers to a letter dated 3 June 2009 sent to her by the Respondent’s solicitors asserting that the children’s living arrangements had substantially changed in that the children were living with her for less than 60% of the child support year and therefore the Child Support Agreement had been terminated. The Applicant disputes that there has been any permanent change to the children’s living arrangements.
The Applicant disputes the Respondent’s contention that clauses 4.4 and 4.12 became on and from any transitional determination by the Child Support Registrar effective from 1 July 2008 a “termination agreement” as found by the Court in Leroy & Moreau[30]. Her contention that neither the Act nor the terminating provisions in the Agreement were enlivened by the event of her absence overseas in April and May 2009.
[30] [2010] FMCAfam 903
Further, the Applicant submits that there is no evidence of compliance with s.80D of the Act, which sets out how a binding child support agreement may be terminated.
The Applicant denies that there is any basis for a declaration that the Agreement was terminated in relation to [X] on 13 June 2009, when he was 15 years of age. Whilst she concedes that on 9 August 2011 the Child Support Agency notified her that an assessment dated 11 March 2011 notifying the parties that the assessment in relation to [X] would remain in force until the last day of the school year on 8 December 2011 had been issued erroneously, on 23 August the Agency issued an administrative assessment in relation to him for the period 15 March 2011 to 8 December 2011. The Applicant submits that the Respondent is not entitled to recover any amount of child support paid for the child’s benefit from 13 June 2009 because, in view of the representations made to her by the Respondent concerning child support for [X] upon his attaining the age of 18 years, the application for recovery is unconscionable and done for an improper purpose.
In the alternative, the Applicant submits that the Court would not exercise its discretion to set aside or make the declarations sought on equitable grounds, the Respondent not coming to Court with clean hands.
If the Agreement is terminated, the Applicant seeks a departure order.
Case outline of the Respondent Father
Senior counsel for the Respondent submitted that the onus rested on the Applicant to establish that the Agreement constituted a Binding Financial Agreement[31]. It was concede that the Agreement complied with the provisions of the Child Support (Assessment) Act required of a child support agreement prior to 1 July 2008. It was also conceded that the agreement was accepted for registration by the Child Support Registrar on 14 June 2006.
[31] sic
What the Respondent submits, however, is that by dint of s.12(4) of the Act, the Registrar’s acceptance of the Agreement had the effect of constituting as potential terminating events, the events referred to in paragraph 4.12 of the Agreement. A terminating event occurred when the first of those defined events occurred.
Mr Lethbridge submitted that the mother’s contention that the provisions of clauses 4.4.4. and 4.12.4 do not constitute a terminating event such as to be able to be relied upon for the purposes of terminating the Agreement relies on an interpretation of the relevant provisions of the Act that would require terminating events to be limited to only those events “the specific day of the occurrence of which was a date which could be prospectively determined as to its date at the date of the Agreement”[32] and such an interpretation would not find favour with the Court.
[32] Case Outline of the Respondent Father 4.8.2011 at [11]
It was submitted that in the interpretation of the provisions of an Act, a construction that would promote the purpose or object underlying the Act is one which is to be preferred to a construction that would not promote that purpose or object (see Acts Interpretation Act 1901 s.15AA). The Court may have regard to extraneous material such as the Explanatory Memorandum to a Bill before it became an Act.[33]
[33] Acts Interpretation Act 1901 s.15AB
Thus, it is submitted that the Court should have regard to the Explanatory Memorandum for the Child Support Legislation Amendment (Reform of the Child Support Scheme – New Formula and Other Measures) Act 2006 which said that:
This Schedule will provide more flexible arrangements with better legal protection for parents who want to make agreements between themselves about the payment of child support.
In keeping with the legislative intent towards flexibility, s.12 of the Child Support (Assessment) Act which defines terminating events includes events determinable both prospectively and retrospectively.
In the alternative, Mr Lethbridge referred the Court to the Respondent’s proposed Order 2, which says:
In the alternative to the declaration sought in paragraph 1 above, a declaration that the Agreement was terminated in relation to the child [X] by operation of paragraph 4.12.1 and/4.12.2 of the Agreement on 13 January 2009.
In respect of this proposed Order, counsel referred the Court to the decision of Brown FM[34] in Daley & Daley[35], where his Honour considered the legislative intent of the amendments at [98]-[100]. The Court was referred to the decision of Baumann FM[36] in Leroy & Moreau[37] , where his Honour considered a clause of a child support agreement providing when the agreement would terminate:
[34] As his Honour then was
[35] [2009] FMCAfam 398; (2009) 41 Fam LR 351; FLC 98-039
[36] As his Honour then was
[37] [2010] FMCAfam 903
4.8 This Child Support Agreement will terminate upon the earliest of the following events:-
4.8.1 the wife’s taxable income exceeding $40,000. per annum, and for the purposes of this clause the wife’s income shall mean and include her salary or personal exertion earnings, investment income and bonuses;
4.8.2 any of the children ceasing to reside with the wife on a full time basis;
4.8.3 any of the children commencing employment on a full-time basis;
4.8.4 the husband’s income increasing or decreasing by an amount greater than 20%, and for the purposes of this clause, the husband’s income shall mean and include his salary or personal exertion earnings, investment income and bonuses.[38]
[38] [2010] FMCAfam 903 at [11]
The evidence was that one of the children had moved out of the wife’s home. His Honour considered the decision in Daley[39] and the provisions of s.80D(3) of the Child Support (Assessment) Act which relevantly provides:
[39] supra
(3) A binding child support agreement is terminated:
(a) …
(b) if paragraph (1)(b) applies – on the day set out in the following paragraph:
(i) if the termination agreement specifies a day on which it takes effect – that day;
(ii) otherwise – the day on which the termination agreement is signed; and
(c) …
His Honour found that, by operation of law, the binding child support agreement as a whole terminated on the date that the child moved out.
It was submitted that the Court should follow this decision.
However, it was also submitted in the alternative that paragraph 4.12 became as and from any transitional determination by the Child Support Registrar effective from 1 July 2008 as a termination agreement. Following the decision in Leroy & Moreau, it was submitted that the agreement was terminated by operation of paragraph 4.12.4 on 30 June 2009, the last day of the relevant child support year.
Supplementary Submissions on behalf of the Respondent Father
These submissions were limited to the primary issue of whether or not the Child support Agreement was terminated as a consequence of the occurrence of the terminating events referred to in paragraphs 4.4. and 4.12. It was submitted that those provisions did not rely for their validity only on the provisions of s.84(1)(g) but also on s.84(1)(c) which provides:
(c) provisions agreeing between parties any other matter that may be included in an order made by a court under Division 4 of Part 7 (departure orders).
Senior counsel for the Respondent submitted that the conditions necessary to give rise to the termination of the agreement have been met and the circumstances in which that occurred are irrelevant. Once a terminating event has occurred, the agreement is brought to an end. It is not open to the Court to disregard a terminating event or resurrect the agreement on the basis of any equitable principle.
Senior counsel for the Respondent also submitted that in the event that the Agreement is held by the Court to have been terminated, the Court should bring an end to the proceedings. This would leave the Applicant with the option to proceed through the administrative assessment program should she wish to vary the “voluntary, and extremely generous, provisions the Father continues to make”.[40]
[40] Supplementary Submissions at [4.1]
Applicant’s Submissions in Reply – Termination
In her submissions in reply, the Applicant submitted that:
a)The proceedings were commenced by way of an application for enforcement for non periodic child support as the Child Support Agency does not have the jurisdiction to do so;
b)The parties then sought competing applications for departure orders and it is in the parties’ interests to have the matters considered together (see Child Support (Assessment) Act s.116(1)(b));
c)The Applicant sought in November 2010 to have the “termination” issue decided in chambers by way of written submissions and the Respondent did not, so that until 4.30 pm on 2 December 2011 both the issue of termination and the competing applications for departure orders were being considered together;
d)There is no basis upon which the proceedings can be brought to an end other than for the Court to determine the Applications and make orders;
e)There is no evidence upon which the Court would find that the Respondent would continue to provide for the children without the need for formability;
f)The Applicant’s evidence should be preferred over the evidence of the Respondent; and
g)It is in the best interests of the parties and the children for the Applications to be heard and determined, orders made and proceedings finalised.
Conclusions
I am satisfied that the Child Support Agreement entered into by the parties on 2 November 2005 remains in force in respect of the parties’ children [Y] and [Z]. I am also satisfied that the Agreement is no longer in force in respect of [X], who is an adult. [X] attained the age of 18 years on 15 March 2011 and the Agreement did not continue to apply to him after that date.
I am not satisfied that there is any scope for a departure application in respect of either [Y] or [Z] because the Child Support Agreement remains in force in respect to them. There is no scope for a departure application in respect of [X] because he is not an eligible child under 18 years of age. If the Applicant considers that [X] requires financial support it will be necessary to make an application for a child maintenance order under s.66L of the Family Law Act.
The parties entered into the Agreement on 2 November 2005. The Agreement does not contain a statement in accordance with s.80C(2)(c) of the Child Support (Assessment) Act that each party was provided with independent legal advice from a legal practitioner as to:
(i) the effect of the agreement on the rights of that party;
(ii) the advantages and disadvantages, at the time that the advice was provided, to the party of making the agreement.
Unlike the child support agreement in Daley[41], this agreement does not appear to be a binding child support agreement but a limited child support agreement. In Daley, the Court held of that agreement at [91]:
The child support agreement, in this case, was entered into between the parties in February of 2005, a period well in excess of 3 years prior to the wife commencing these proceedings. It is deemed to be a binding agreement, not because each of the parties to it was provided with comprehensive legal advice regarding its implications, but rather because it is expressed to conclude when [Y] is 18 years of age and makes no provision for any other terminating event (emphasis added).
[41] supra
It can be seen that the Agreement under review does contain, at 4.4. and 4.12, provision for a terminating event prior to all or any of the children attaining the age of 18 years.
The Agreement provides at 4.4:
The first payment of Periodic Child Support is to be made on the date of the Agreement and the final payment to be made on the first of the following events:
4.4.1. the happening of a child support terminating event in relation to the child/children as defined by Section 12 of the Act;
4.4.2. on the child/children attaining the age of 18;
4.4.3. the child/children obtaining paid full-time employment;
4.4.4 the child/children living with the carer for less than 60% of the nights of a child support year.
Clause 4.4.12 of the Agreement is in similar terms:
The first payment of Non-periodic Child Support is to be made on the date of the Agreement and the final payment to be made upon the first of the following events:
4.12.1. the happening of a child support terminating event in relation to the child/children as defined by Section 12 of the Act;
4.12.2 on the child/children attaining the age of 18;
4.12.3 the child/children obtaining full-time paid employment;
4.12.4. the child/children living with the carer for less than 60% of the nights of a child support year.
It can be seen that the Agreement is rather unsatisfactory in its drafting. Subsection 12(1) of the Act provides:
(1) A child support terminating event happens in relation to a child if:
(a) the child dies; or
(b) the child ceases to be an eligible child under regulations made under subsection 22(1); or
(c) the child turns 18; or
(d) the child is adopted; or
(e) the child becomes a member of a couple; or
(f) none of the following subparagraphs applies any longer in relation to the child:
(i) the child is resident in Australia;
(ii) the child is an Australian citizen;
(iii) the child is ordinarily resident in Australia; or
(g) the circumstances described in subsection 30AA(1) of the Registration and Collection Act apply in relation to the child.
As can be seen, a child turning 18 is a child support terminating event under s.12(1)(c), so it is difficult to see why it was considered necessary to add the second proviso in Clauses 4.4 and 4.12 at 4.4.2. and 4.12.2:
on the child/children attaining the age of 18;
when that eventuality was already provided for.
It is certainly the case that the third proviso in 4.4. and 4.12:
the child/children obtaining full-time paid employment
is clearly a terminating event that could take place prior to a child attaining the age of 18 years.
So, too, is the proviso at 4.4.4. and 4.12.4:
the child/children living with the carer for less than 60% of the nights of a child support year.
The Agreement was registered with the Child Support Agency on 14 June 2006. It was reviewed by the Child Support Agency and on 8 February 2008 the Agency issued a determination would continue after 30 June 2008. Thus, it remained in force and was treated by the parties as remaining in force.
The Respondent seeks, as an alternative to an order that the Agreement was terminated by operation of cl.4.12.4 on 30 June 2009, an order in these terms:
2. In the alternative to the declaration sought in paragraph 1 above, a declaration that the Agreement was terminated in relation to the child [X] by operation of paragraph 4.12.1 and/or 4.12.2 of the Agreement on 13 January 2009.
The parties entered into Consent Orders on 13 January 2009. The Orders provided for such things as:
a)Equal shared parental responsibility;
b)The children to live with their father for half of the school holidays;
c)The children spending equal time with each parent over Christmas Eve and Christmas Day;
d)The children spending alternate Easter long weekends with each parent;
e)The children are to have the opportunity to spend their birthdays with each parent;
f)The children are to spend Mother’s Day with their Mother and Father’s Day with their father;
g)The parents should keep each other informed of medical matters affecting the children and other routine matters.
Order 13 is relevant to the argument about the Applicant’s absence from Australia between 26 April and 10 May 2009, so it is set out in full:
If either parent is outside of New South Wales or the Commonwealth of Australia for more than 2 consecutive nights and the children are ordinarily living with them for the whole of[42] part of that period, then the parent must inform the other parent and offer to the other parent the first opportunity to care for the children in their absence.
[42] sic
The above order is, as I said, relevant to the other argument but does not appear to have any particular relevance to the argument in support of the declaration that the Agreement was terminated in relation to [X] on 13 January 2009.
The only specific reference to [X] in the submissions on behalf of the Respondent can be found in the document entitled Case Outline of the Respondent Father of 4 August 2011 in the section headed Paragraph 4.12 of the agreement constitutes, as and from 1 July 2008, a termination agreement.
Whilst I will return to that part of the submission shortly, I note that the only reference to [X] appears at paragraph 25 of the submission:
It is contended on the Father’s part that there can be no issue regarding the application of the Act should it be necessary for the Court to consider only the termination in relation to the elder child.[43]
[43] i.e. [X]
I have read through the Consent Orders of 13 January 2009 thoroughly in an attempt to glean a reason for the proposed declaration that the Agreement was terminated in relation to [X] on that date. The only reference to [X] in those Orders other than in Note A at the commencement, where he is included in the group referred to as “children”, is in Order 5, which provides:
Notwithstanding the above, the parties shall ensure that the children have the opportunity to spend their birthdays with each parent. The parent with whom the children are ordinarily living around their birthday shall elect whether the children shall spend the night before their birthday or the night of their birthday with them and shall offer the other parent the opportunity for all of the children to spend time with that parent on that evening not selected by the parent with whom the children are ordinarily living, e.g. if the children are ordinarily living with the mother on [X]’ birthday, then the mother shall elect to have the children spend either the evening of [date omitted] or the evening of [date omitted] with her and the father shall have the opportunity to spend time with the children on the day not selected by the mother.
There is no other specific reference to [X] in the Orders of 13 January 2009. I am completely mystified as to how it can be argued that in some way it can be argued that the Agreement was terminated in respect to him by operation of paragraph 4.12.1 and or 4.12.2 of the Agreement on that date.
Proviso 4.12.1 refers to the happening of a child support terminating event as defined by s.12. Proviso 4.12.2 refers to “the child/children attaining the age of 18”. Neither of those applies in respect of [X] on 13 January 2009. He was born on [omitted] 1993, so on 13 January 2009 he was 15 years and [omitted] months old on 13 January 2009.
To state the obvious, [X] did not:
a)die;
b)cease to be an eligible child under regulations made under subsection 22(1);
c)turn 18;
d)become adopted;
e)become a member of a couple;
f)cease to:
i)be present in Australia;
ii)lose his Australian citizen ship;
iii)cease to be ordinarily resident in Australia; or
g)become subject to any of the circumstances described in subsection 30AA(1) of the Child Support (Registration and Collection) Act 1988.
Consequently, [X] did not meet any of the conditions in either proviso 4.12.1 or 4.12.2. It follows that the Agreement was not terminated in relation to the child [X] by operation of the Agreement on 13 January 2009.
The Respondent has referred the Court to the decision in Leroy & Moreau[44], where Baumann FM considered a clause in agreement constituting termination events and found that, as a result of one child having moved out, the agreement as a whole was terminated. His Honour said at [27]:
The agreement should be given its plain and ordinary meaning and must be interpreted in the context of the obligations that parents hold to meet the reasonable costs of their children equitably (see s.4 of the CSAA).
[44] supra
The agreement which his Honour had to consider contained this clause constituting terminating events:
4.8 This Child Support Agreement will terminate upon the earliest of the following events:
4.8.1 The Wife’s taxable income exceeding $40,000 per annum and for the purpose of this clause the Wife’s income shall mean and include her salary or personal exertion or earnings, investment income and bonuses;
4.8.2 Any of the children ceasing to reside with the Wife on a full-time basis;
4.8.3 Any of the children commencing employment on a full-time basis;
4.8.4 The Husband’s income increasing or decreasing by an amount greater than 20% and for the purposes of this clause, the Husband’s income shall mean and include his salary or personal exertion earnings, investment income and bonuses.
His Honour held at [28]:
In my view clause 4.8.2 became operative when [Z] moved out of the Mother’s home.
It can be seen that the provisos in the Agreement under review are significantly different in a number of respects. Unlike the agreement in Leroy & Moreau, which referred at 4.8.2 and 4.8.3 to “any of the children”, all of the provisos in clauses 4.4 and 4.12 of the Agreement under review refer to “the child/children”.
Clearly, this would indicate an intention that the children are to be considered individually, an eventuality contemplated in the Respondent’s submissions about [X] quoted at [121] above. Applying “the plain and ordinary meaning” of the words, as was held in Leroy & Moreau, and interpreting the words “in the context of the obligations that parents hold to meet the reasonable costs of their children equitably”, it would seem to be odd that the parties would contemplate a cessation of non-periodic child support, which includes the children’s education expenses in 4.8 and medical expenses in 4.10, upon one child attaining the age of 18 years.
It is clear that in the ordinary course of events [X], being the eldest, would attain the age of 18 years before either [Y] or [Z]. Had [X] have died before he turned 18, that would have been a child support terminating event in 4.12.1 and again, on the Respondent’s arguments, the entire Agreement would have come to an end.
If it was the intention of the parties that their agreement was to be subject to [X]’s age and circumstances, then they would surely have provided for that to be the case, rather than use the phrase “child/children”. It must clearly have been the intention of the parties that the agreement was to provide for each of their children.
What, then, should be made of the troublesome proviso in clauses 4.4.4 and 4.12.4 that the agreement would be terminated by “the child/children living with the carer for less than 60% of the nights of a child support year”? It is submitted on behalf of the Respondent that, by the children remaining in the care of the Applicant in April and May 2009 for a period that brought the children’s time with the Respondent to 42% of the nights of a child support year, the entire Agreement was terminated as at 30 June 2009. It is further submitted that “the circumstances in which that occurred are irrelevant”.[45] With respect, this appears to be a most arbitrary and potentially unfair interpretation and hardly in keeping with the summary in the Explanatory Memorandum to the Child Support Legislation Amendment (Reform of the Child Support Scheme – New Formula and Other Measures) bill 2006 to which the Court has been referred by Mr Lethbridge:
[45] Supplementary Submissions on behalf of the Respondent Father at 3.1.
Summary
This Schedule will provide more flexible arrangements, with better legal protection, for parents who want to make agreements between themselves about the payment of child support…[46]
[46] Case outline of the Respondent Father 4.8.2011 at 13
Indeed, the reverse would appear to be the case.
The Applicant’s submission is that the circumstances of April and May 2009 were a “one off” occurrence and not intended to be a permanent arrangement. What she was doing was complying with Order 13 of the Consent Orders of 13 January 2009, by offering the Respondent the first opportunity to care for the children in her absence. If by complying with a parenting order made by consent the Applicant was going to jeopardise the entire child support agreement, it is easy to see that this would be a disincentive to a parent to enter into such an agreement.
To take the Respondent’s argument further, a situation could arise towards the end of a child support year where the carer was to become ill or injured on 26 June and required hospitalisation for four days. On the Respondent’s case, that circumstance could tip the balance of percentages in such a way that the entire child support agreement would be instantly terminated.
The Respondent’s submissions lead, with respect, to an absurd conclusion and one not conducive to the best interests of the children.
Turning to the subject of [X], who attained the age of 18 years on 15 March 2011. It is clear that the Agreement no longer applies to him with effect from that date, as the Respondent did not agree to co-sign a letter to the Child Support Agency extending the provisions of the Agreement until the conclusion of the school year on 8 December 2011. In any event, that date, too, has passed, and [X] is now twenty years old.
I am not of the view that the Respondent should be entitled to any refund of any amounts of child support paid after [X] attained the age of 18 years. There is evidence that the Respondent told the Respondent in an email on 7 March 2011:
Ms Somers
As I have told you I will continue to pay child support for [X] until he finishes school. That is standard practice when kids turn 18 and I have ever intention of doing so,
I don’t get what your issue is and yet another threat of court action?[47]
[47] Affidavit of Ms Somers - Child Support for [X] Affidavit 11.9.2011 Annexure “D”
In the circumstances, the Respondent should not receive any refund of any amount paid for the support of his son.
Enforcement Summons
This summons is still on foot and should proceed. Due to the effluxion of time since the proceedings were heard, the parties should have the opportunity to file updated affidavits as to their finances. The Applicant, in particular, may well wish to provide details as to the quantum of the amounts she now seeks by way of arrears under the Agreement.
Costs
Each party seeks an Order for costs. They should both have the opportunity, if they wish, to file an affidavit giving details of costs and disbursements sought.
I certify that the preceding one hundred and forty-three (143) paragraphs are a true copy of the reasons for judgment of Judge Scarlett
Associate:
Date: 3 May 2013
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