Sproul and Child Support Registrar (Child support)

[2020] AATA 1769

Sproul and Child Support Registrar (Child support) [2020] AATA 1769 (16 April 2020)

DIVISION:Social Services & Child Support Division

EXTENSION APPLICATION

NUMBER:2020/AC018226

APPLICANT:  Mr Sproul

OTHER PARTY:  Child Support Registrar

DATE DECISION MADE:                16 April 2020

APPLICATION:

An extension application made on 15 January 2020 asking the AAT to consider the application for AAT first review of a decision of the Child Support Registrar on 14 September 2019 despite the period for applying for review having ended.

DECISION:

The extension application is refused.

CATCHWORDS

CHILD SUPPORT – application for extension of time - no satisfactory explanation for the lengthy delay - little merit – prejudice to the other parent - extension of time refused

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

STATEMENT OF REASONS

1. On 15 January 2020 Mr Sproul lodged an application with the Administrative Appeals Tribunal (the Tribunal) for an extension of time for review of a child support decision made on 14 September 2019.  The matter was considered on 16 April 2020 on the papers (consistent with the Tribunal’s ‘Child Support Review Directions’).  The Tribunal had before it a bundle of documents provided by the Child Support Agency.

2. Mr Sproul and [Ms A] are the parents of [Child 1] (born January 2011).  The case commenced on 9 January 2014 and Mr Sproul is currently the parent liable to pay child support under the assessment.

3. On 28 February 2019 [Ms A] applied for a change to the administrative assessment on the basis of a parent’s income, property and financial resources (the ground commonly referred to as Reason 8A). Mr Sproul lodged a cross application on the same ground.

4. On 3 July 2019 the Child Support Agency made the decision to change the assessment (the original decision) so that:

   ·     the existing change of assessment decision made on 19 October 2018 ceases to have effect on 4 February 2019; and

   ·     for the period from 5 February 2019 to 17 October 2021 the adjusted taxable income of Mr Sproul is set at $100,000.

5. On 26 July 2019 Mr Sproul objected to this decision and on 14 September 2019 the Child Support Agency disallowed the objection (the objection decision).

6. The statutory provisions relevant to this review are contained in the Child Support (Registration and Collection) Act 1988 (the Act) and the Child Support(Assessment) Act 1989 (the Assessment Act).

7. The issue which arises in this case is whether or not to grant Mr Sproul’s request for an extension of time to submit an application for review of a child support decision.

8. Part VIIA, Division 2 of the Act sets out the procedures for applying to the Tribunal for a review of an objection decision made by the Child Support Agency, as well as applying for an extension of time for such a review in the event the application is not made within the prescribed period.

9. Subsection 29(2) of the Administrative Appeals Tribunal Act 1975 establishes that an application for review must be made within 28 days of being served with notice of the decision.

10. If the 28-day period to apply for review has ended, then a written application for an extension of time can be made under section 91 of the Act. The Tribunal finds Mr Sproul was advised about the outcome of the objection decision by electronic means in a letter from the Child Support Agency dated 16 September 2019. Given Mr Sproul lodged his application more than 28 days after he was served with notice the Tribunal is satisfied that an extension of time was required.

11. Under subsection 92(1) of the Act, the Tribunal must consider and grant or refuse an extension application. In doing so, the Tribunal considers the guiding principles for the exercise of discretion to allow an extension of time as set out in Hunter Valley Developments Pty Ltd v Cohen [1984] FCA 186. In that case, the Federal Court said an extension of time should not be granted unless satisfied it was proper to do so, noting that, in general, applications or proceedings commenced outside of a prescribed time limit will not be considered.

12. A review of other relevant authorities establishes that when considering whether or not to allow an extension of time, the Tribunal should consider and balance a range of factors.  These factors are a guide and are not exhaustive, but generally include:

    ·     the reasons for the delay and whether the applicant rested on their rights;

    ·     the merits of the substantive application;

    ·     any prejudice to the other party including any difficulties they will experience in providing evidence as a result of the delay;

    ·     any prejudice to the general public; and

    ·     fairness in granting an extension of time.

Reasons for the delay

1. The Tribunal finds that Mr Sproul’s application for an extension of time on 15 January 2020 in relation to the objection decision made on 14 September 2019, of which he was notified by electronic means on 16 September 2019, is approximately 93 days out of time.

2. In seeking an extension of time Mr Sproul provides several reasons for the delay in his application some of which are not directly relevant.  Mr Sproul summarises these reasons by stating that he gets so upset when reading the decisions and comments made by the Child Support Agency that it takes him “days to settle down”. Mr Sproul also refers to his mental health and states that he is already unstable and depressed.

3. In support of his application to the Tribunal Mr Sproul provided a letter from [Dr B] dated 27 November 2019. The letter states that Mr Sproul has reduced earning capacity due to reduced work capacity associated with degenerative changes in his [Body Part 1] aggravated by two motor vehicle accidents. The letter also states that Mr Sproul has been diagnosed and treated for post-traumatic stress disorder and depression.

4. The Tribunal accepts that Mr Sproul has a number of health issues for which he is being treated. These include depression.  The Tribunal has considerable sympathy for Mr Sproul in this regard.

5. The Tribunal notes, however, that Mr Sproul was employed at the time of the objection decision and caring for his young daughter.  The Tribunal also notes that Mr Sproul lodged an application for a change of care to the Child Support Agency prior to submitting his application to the Tribunal for review of the objection decision.  Given Mr Sproul was able to work and undertake the usual parenting activities associated with caring for a child, the Tribunal is not satisfied his mental health prevented him from submitting his application in a timely fashion. Furthermore, as Mr Sproul was able to deal with other child support matters, it is the view of the Tribunal that his mental health was not a significant reason for the lengthy delay in submitting his application to the Tribunal.

6. The notification of the objection decision provided by the Child Support Agency dated 16 September 2019 outlines what to do if Mr Sproul disagreed with the decision.  This included asking the Tribunal to undertake a review “within 28 days from the date you receive this letter”.  The words “within 28 days” are in bold which, in the view of the Tribunal, gives a clear indication of the importance of this timeframe.

7. The Tribunal also notes in evidence from the Child Support Agency that during a conversation with the objections officer on 16 September 2019 regarding the outcome of the objection decision Mr Sproul indicated he was satisfied with the explanation provided. Mr Sproul was also reminded of his appeal rights.

8. The Tribunal finds that Mr Sproul has not provided a reasonable explanation for the considerable delay in applying for a review of the objection decision. The Tribunal also finds Mr Sproul rested on his rights.

Merits of the application

1. Mr Sproul is seeking a review of an objection decision which affirmed the original decision made by the Child Support Agency.  Consequently there was no impact on the assessment.

2. In his application to the Tribunal Mr Sproul referred to his prior injuries and the impact these injuries have on his capacity to earn. Mr Sproul also states that he believes the objection decision is incorrect because he has no income, cannot find a job that suits him and the money he received from his superannuation fund was for past and future economic loss. Mr Sproul argues this money should not be considered as income for the purposes of child support.

3. In making any determination to depart from an administrative assessment, the Child Support Agency must first find a ground for departure. These grounds are listed in the Assessment Act and in this case it was on the basis of Mr Sproul’s income, property and financial resources.

4. In considering the merits of Mr Sproul’s application, the Tribunal therefore conducted a careful review of the information used by the Child Support Agency in reaching its decision.

5. At the time [Ms A] lodged her application for a change of assessment the annual rate of child support was $0 as set by a previous change of assessment decision made on 19 October 2018.  This decision was based around a payment of $180,000 Mr Sproul said he withdrew from his superannuation fund. The decision-maker determined this payment was a financial resource available to Mr Sproul equivalent to $60,000 a year over a three-year period ending 17 October 2021.  As this income amount was the same as [Ms A]’s average annual salary of approximately $60,000 and the parents were sharing care the annual rate of child support was set at $0.  The Tribunal notes that neither parent objected to the change of assessment decision made on 19 October 2018.

6. In the original decision of 3 July 2019 the Child Support Agency set the adjusted taxable income for Mr Sproul at $100,000 until 17 October 2021. This amount was calculated by adding to his income of $40,000 from recently commenced employment the sum of $60,000 as determined under the previous change of assessment made on 19 October 2018.  In establishing Reason 8A the decision maker concluded at the time that, “Failure to recognise the change in Mr Sproul’s working arrangements would cause an unjust and inequitable assessment of the child support to be provided for [Child 1]”.

7. In the objection decision the objections officer also found that the $180,000 available to Mr Sproul from his superannuation fund should be considered as a financial resource for the purposes of child support. The objections officer also thought it fair to spread this amount across a three-year period. The objections officer found that Mr Sproul’s income from employment was likely to be higher than $40,000.  As Mr Sproul was a contractor and there was some uncertainty about his ongoing income, however, the objections officer determined that $40,000 was reasonable under the circumstances.

8. The Tribunal notes that Mr Sproul acknowledged he was working at the time the objection decision was made. The objections officer calculated Mr Sproul’s income from employment based on payments of $30,978.50 he received in the period from 4 February 2019 to 22 August 2019 as well as information from his employer.  This amount, when annualised, equated to approximately $53,000.  As previously noted, the objections officer determined an amount of $40,000 to be reasonable given Mr Sproul was a contractor.

9. The Tribunal considers the approach taken by the Child Support Agency in relation to the income Mr Sproul received from employment to be appropriate.

10. Mr Sproul has stated that he has no income.  If his employment circumstances have changed since the objection decision was made, Mr Sproul could consider lodging a new change of assessment application.

11. Mr Sproul also believes the money he received from his superannuation fund should not be considered as income for the purposes of child support.

12. Section 43 of the Assessment Act defines a parent’s adjusted taxable income for the purposes of child support. This includes a parent’s reportable superannuation benefits. Income, property and financial resources which are not part of a parent's adjusted taxable income may also be taken into account under Reason 8A. This includes lump sum payments received as compensation from personal injury.

13. Mr Sproul did not object to the change of assessment decision made on 19 October 2018 which determined the payment from his superannuation fund of $180,000 should be considered as income for the purposes of child support.  He is now opposed to these funds being applied in the objection decision of 14 September 2019.  While he has a right to change his view, the Tribunal is nonetheless satisfied the approach taken by the Child Support Agency in relation to the money Mr Sproul received from his superannuation fund is reasonable.

14. The test of merit has alternatively been expressed as whether, were it to proceed, the application for review “would have good prospects of success” (Smith and Commissioner of Patents [2012] AATA 60 at [29]–[31]).

15. Based on the evidence available, the Tribunal finds Mr Sproul’s application for review would not have good prospects of success on the ground of his income, property and financial resources.  The Tribunal therefore considers Mr Sproul’s application has little merit.

Potential prejudice to [Ms A] and the wider public

1. [Ms A] should ordinarily be able to rely on the child support assessment once the time for objection has passed.  Given Mr Sproul is approximately 93 days late in making his application, it would be reasonable for [Ms A] to consider the objection decision was final.  The Tribunal finds [Ms A] would be disadvantaged if an extension of time to lodge an objection was granted.

2. Time limits for the review of administrative decisions should be observed as strictly as possible in order to assist the proper administration of government agencies.  There is also a public expectation that there be a degree of certainty in relation to time limits, however, the law also allows for extensions of time.  In this case the Tribunal believes there would be prejudice to the general public if an extension of time to lodge an objection was granted.

Fairness in granting an extension of time as between Mr Sproul and other persons in similar positions

1. The Child Support Agency notifies parties that they can seek a review of decisions with the Tribunal and they have 28 days within which to submit a request for such a review.  Most people comply within the 28-day timeframe.  It is clear the statutory time limit is to be enforced unless there are acceptable reasons for the delay.  The Tribunal is not satisfied Mr Sproul’s circumstances are sufficiently different to that of other applicants in a similar position that an extension of time is warranted.  The Tribunal finds that it would be unfair to others to grant Mr Sproul an extension of time in view of the statutory timeframe which applies.

CONCLUSION

1. Mr Sproul has not provided a satisfactory explanation for the delay in applying for a review of the objection decision.  The Tribunal could also find little merit to his application based on the evidence available.  This weighs heavily against the granting of an extension of time.  There would also be prejudice to [Ms A] should an extension of time be granted.

2. Having carefully considered the various factors which it must take into account, the Tribunal finds it would not be proper to grant an extension of time to seek review of the objection decision made on 14 September 2019.  Accordingly, the extension application is refused.