Tanner & Dalton (SSAT Appeal)
[2012] FMCAfam 732
•26 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| TANNER & DALTON and ANOR (SSAT APPEAL) | [2012] FMCAfam 732 |
| CHILD SUPPORT – SSAT APPEAL – Appeal from decision of SSAT – consideration of ground of appeal – whether error of law shown – appeal dismissed. |
| Child Support (Assessment) Act 1989 (Cth), ss.98S, 117, 55G Child Support (Registration and Collection) Act 1988 (Cth), ss.110B, 110K, 95 Federal Magistrates Act 1999 (Cth), s.3 |
| Tasman & Tisdall [2008] FMCAfam 126 Podmore & Pillai (SSAT Appeal) [2011] FMCAfam 952 Comcare v Moon [2003] FCA 569 Frost & Frost & Anor (SSAT Appeal) [2011] FMCAfam 1311 LDME & JMA (SSAT Appeal) (2007) FLC 98-034 Morse & Potts (SSAT Appeal) [2010] FMCAfam 1305 Agrippa & Horton (SSAT Appeal) [2010] FMCAfam 1144 Weir & Weir (1993) FLC 92-338 Black & Kellner (1992) FLC 92-287 Ladd & Child Support Registrar & Anor (SSAT Appeal) [2010] FMCAfam 23 Gyselman & Gyselman (1992) FLC 92-279 Tasman & Tisdall [2008] FMCAfam 126 Apthorpe v Repatriation Commission (1987) 13 ALD 656 Kioa v West (1985) 159 CLR 550 Eades & Cadell (SSAT Appeal) [2009] FMCAfam 275 |
| Applicant: | MR TANNER |
| First Respondent: | MS DALTON |
| Second Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | HBC 342 of 2011 |
| Judgment of: | Baker FM |
| Hearing date: | 9 May 2012 |
| Date of Last Submission: | 9 May 2012 |
| Delivered at: | Hobart |
| Delivered on: | 26 July 2012 |
REPRESENTATION
| Counsel for the Applicant: | In person |
| Solicitors for the Applicant: | In person |
| Counsel for the first Respondent: | Ms Mooney of Counsel |
| Solicitors for the first Respondent: | Bishops Barristers & Solicitors |
| Counsel for the second Respondent: | Mr Sparkes |
| Solicitors for the second Respondent: | Australian Government Solicitor |
ORDERS
That the Notice of Appeal filed by the father on 5 May 2011 be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Tanner & Dalton &and Anor is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT HOBART |
HBC 342 of 2011
| MR TANNER |
Applicant
And
| MS DALTON |
First Respondent
| CHILD SUPPORT REGISTRAR |
Second Respondent
REASONS FOR JUDGMENT
Introduction
This was an appeal by Mr Tanner (“the father”) from a decision of the Social Security Appeal Tribunal (“the SSAT” or “the Tribunal”) made 5 April 2011. The first and second respondents in this matter were, respectively, Ms Dalton. (“the mother”) and the Child Support Registrar (“the CSR”).
On 1 April 2011 the SSAT set aside the decision of the objections officer of the Child Support Agency and substituted its decision that the father’s adjusted taxable income be set at $39,813.00 for the period 1 September 2010 to 31 March 2012.
In the Notice of Appeal (Child Support) filed 5 May 2011 (“the Notice of Appeal”) the father sought that the decision of the SSAT be set aside, and that the matter be remitted to the SSAT. There were five grounds of appeal.
Grounds one, three and four assert that the SSAT erred in law by making findings in relation to the father’s necessary expenditure, business income and vehicles, when there was no evidence to support such findings.
Grounds two and five assert that the SSAT denied the father procedural fairness by failing to give him the opportunity to consider and make submissions in relation to the publication “What Jobs Pay 2010-2011,” and in relation to the Costs of the Children Table used in the child support formula.
Background
In its Decision, the SSAT set out the background of the parents, who are the parents of the children X born (omitted) 1994 and Y born (omitted) 1996 (“the children”). The father has been assessed as liable to pay child support to the mother in respect of the children.
For around six years until 20 August 2010, the father was self-employed as a (occupation omitted). In 2010 he incorporated a company, (omitted), which took over the (omitted) business, and which through he trades, undertaking (omitted) work (“the business”).
The father owns a property in Property B, from which he receives rental income. He lives with his wife in her home.
The mother is employed and is in receipt of parenting payment, single and family tax benefit. Additionally, she operates a business.
On 29 April 2010 the father applied to the CSR for a decrease in his assessment of child support on the grounds of the income, earning capacity and financial resources of the children, the necessary expenses to support himself and his income, property and financial resources. He sought that he be assessed at the minimum rate from 1 July 2008.
On 28 May 2010 his application was refused by a senior case officer (“SCO”), a delegate of the CSR, for the period 29 October 2008 to 30 November 2010. The SCO noted that the departure period could not extend past 20 October 2008 pursuant to s.98S of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act”). On 8 July 2010 the father lodged an objection to this decision. On 17 September 2010, his objection was allowed.
In its Reasons for Decision made 5 April 2011 (“the Decision”), the SSAT set out:
On 17 September 2010 [the father’s objection to the assessment] was allowed… The objection officer decided that Reasons 4 and 7 were not established. The officer set out the assessments for the period 1 July 2008 to 30 November 2011. He found that [the father] had financial resources in the 2010 financial year of approximately $58000 per annum and found that [the father] could afford $100 per week to meet his child support obligations. The objections officer then concluded that this would result in an annual rate of $3600 (which appears to be an error). The objections officer considered the change to increase [the father’s] liability should be from 1 September 2010 so as to not create further arrears.[1]
[1] The decision at 9
On 6 October 2010, the father applied to the SSAT for review of the Decision.
At the SSAT hearing the father represented himself and gave evidence. The mother was represented and gave evidence. The decision was dispatched to the parties on 5 April 2011.
As I have indicated, the SSAT set aside the decision under review and substituted its decision that the father’s adjusted taxable income be set at $39,813.00 for the period from 1 September 2010 to 31 March 2012. The SSAT found that:
·The father had produced no evidence to persuade it that the children were employed or had property or financial resources, or that the child support assessment was otherwise unfair or inequitable on that ground.
·The level of the father’s necessary commitments to support himself was not such that his capacity to provide financial support to his children was significantly reduced.
·A ground of departure was established on the basis that the father’s income, property and financial resources rendered the assessment unjust and inequitable.
·It would be just and equitable, with reference to s.117(4) of the Assessment Act, and otherwise proper, with reference to s.117(5), and determined that:
[The father’s] adjusted taxable income be set at $39813 for the period 1 September 2010 to 1 March 2012.[2]
[2] The decision at 90
Relevant law
Section 110B of the Child Support (Registration and Collection) Act 1988 (Cth) (“the Registration and Collection Act”) provides that a party may only appeal from a decision of the SSAT on a question of law.
Counsel for the mother relied upon the authority of Tasman & Tisdall[3] in which Brown FM identified the circumstances in which an administrative tribunal such as the SSAT may be found to have made an error of law. They are if it:
[3] [2008] FMCAfam 126
i) fails to construe properly the legislative provisions applicable;
ii) identifies the wrong issues or asks itself the wrong questions;
iii) ignores relevant material or relies on irrelevant material;
iv) fails to accord procedural fairness to the party before it;
v) makes an erroneous finding of such a magnitude that it goes to the very jurisdiction which it purports to exercise rendering its decision perverse or unreasonable or otherwise offending logic…[4]
[4] Ibid at 44
Further, Counsel for the mother relied on the authority of Podmore & Pillai (SSAT Appeal)[5] in which Brown FM considered the circumstances in which a finding of fact by the SSAT becomes a question of law:
A finding of fact is not reviewable by a court in the context of judicial review, unless the finding of fact is made in the absence of evidence to support it. That is an error of law. As is the drawing of a factual inference in the absence of evidence to support it. However, the making of a wrong finding of fact is not in itself an error of law provided there is some evidence before the decision maker concerned which is rationally (as opposed to perversely) capable of supporting such a conclusion.[6]
[5] [2011] FMCAfam 952
[6] Ibid at 122
Counsel for the CSR referred to the authority of Comcare v Moon,[7] in which the Federal Court of Australia considered the role of courts undertaking administrative review of tribunals such as the SSAT, and the need for caution when assessing whether or not the tribunal has made an erroneous finding of fact capable of being an error of law. Mansfield J held:
…Care must be taken not to convert questions of fact into questions of law. The Tribunal, moreover, does not commit an error of law merely because it finds facts wrongly or upon a doubtful basis, or because it adopts unsound reasoning: Minister for Immigration & Multicultural Affairs v Rajalingam (1999) 93 FCR 220 at 257; Willcocks v Comcare [2001] FCA 1315 at [6]. If there is any evidence rationally and legally capable of supporting a finding of fact, then the finding of fact does not involve an error of law. That is so even if there is a significant body of evidence pointing to a contrary finding of fact. And the decision as to what evidence is to be accepted is a matter for the administrative decision maker and not for the Court. It is not the function of the Court on an application such as the present to review the Tribunal's findings of fact and to substitute its view of the facts for those of the Tribunal.[8]
[7] [2003] FCA 569, cited in Frost & Frost & Anor (SSAT Appeal) [2011] FMCAfam 1311 at 82
[8] Ibid at 33
Consideration
Before the Court was the Decision, a transcript of proceedings for the hearing on 11 March 2011 (“the Transcript”) and the documents provided to the Court pursuant to s.110K of the Registration and Collection Act.
The father relied upon the Notice of Appeal, the transcript and his affidavit filed 4 August 2011. The mother relied upon written submissions filed 2 November 2011. The second respondent relied upon written submissions filed 21 October 2011. The parties tendered by consent a document entitled “Outstanding Creditors as of the 1st January 2011” which was before the SSAT, but which was not part of the documents produced to the Court pursuant to s.110K of the Registration and Collection Act.[9]
[9] Exhibit “1”
Grounds one, three and four
Grounds one, three and four of the appeal are related in that they assert that the SSAT erred by drawing conclusions about the father’s financial circumstances, which were not justified by the evidence before it. Those grounds were set out by the father in the notice of appeal as follows:
a)Ground one:
That [the SSAT] erred in law by finding that the level of the Applicant’s necessary expenditure is not such that his capacity to provide financial support for his children is significantly reduced, when [the SSAT] had no evidence or material before it to justify the making of that finding.
b)Ground three:
That [the SSAT] erred in law in finding that the Applicant’s reported business income in his taxation return is below what he actually receives, when there was no evidence or material before [the SSAT] to justify the making of that finding.
c)Ground four:
That [the SSAT] erred in law in finding:
a) that Toyota and Jeep vehicles of the Applicant were sold or are in private use; and
b) as to the sale price of those vehicles;
when there was no evidence or material before [the SSAT] to justify the making of that finding.
I have regard to the decisions of LDME & JMA (SSAT Appeal)[10] and Morse & Potts (SSAT Appeal)[11], and the objects of this Court as set out at ss.3(2)(a) and (b) of the Federal Magistrates Act 1999 (Cth).
[10] (2007) FLC 98-034 at 30-31
[11] [2010] FMCAfam 1305
The father did not make specific submissions on the grounds of appeal, and his submissions were difficult to follow. His case took the form of general complaints about the Decision.
I am aware that the distinction between questions of law and fact can be difficult for a self-represented litigant to understand. I do not intend to take an “overly pedantic” approach to analysing the grounds of appeal and the submissions of the father.[12] I shall examine the material and attempt to ascertain whether a question of law arises.
[12] Ibid
Grounds one and three
In making its findings in respect of the father’s financial circumstances, the SSAT assessed the father’s income, and the expenses of his business.
In considering the business expenses, the Tribunal made findings about:
·Interest expense for the business and the rental property related to one mortgage account;
·Motor vehicle expenses; and,
·Depreciation expenses.
The father submitted that the Decision was wrong because it did not have all of the information about his financial circumstances. I have regard to the authorities referred to earlier in these Reasons. It is not the role of this court to rehear the father’s case on the merits. I am required to consider whether or not the SSAT made any errors based on the evidence which was before it, and whether any such errors are sufficiently grave as to give rise to an error of law.
The SSAT considered the father’s commitments to support himself by having regard to his statement of financial circumstances. Other financial records before the Tribunal were as follows:
- a ‘cash book’ that [the father] prepared from his business bank account. He stated that all business income and expenditure went through this account. (A10)
- Mortgage account for the period 22 May 2010 to 16 November 2010 (balance $139478) (A7, F1), with the facility to draw up to $152000 (A7, F16)
- Business transaction account for the period 24 June 2010 to 22 October 2010 (A7, F3-9)
- Credit card account for the period 16 July 2010 to 15 September 2010 (A7, F11-12)
- Bendigo bank account for the period 30 September 2009 to 26 November 2009 (A7, F13) – [the father] said the account was then closed.
- Bendigo bank account for the period 25 November 2009 to 1 December 2009 (A7, F14) – [the father] said the account was then closed.[13]
[13] The decision at 35
Additionally, the SSAT had before it the following relevant documents:
·The statement and documents provided to it by the CSA pursuant to s.95(3) of the Registration and Collection Act, which include the income tax returns for the father for the years 2007, 2008 and 2009.
·The father’s 2010 income tax return, which was provided during the hearing.
The father conceded that he was questioned at length about his financial circumstances. He was asked about his losses shown in his income tax returns. He was questioned about the interest incurred for loans on his rental property and motor vehicles, which he deducted from his income.
An examination of the Transcript shows that, despite the material referred to above, the SSAT had unsatisfactory evidence of the applicant’s financial circumstances.
The father did not provide copies of statements of all bank accounts as directed by the Tribunal. When he was asked about his bank accounts, he would not disclose any details about his personal bank account. He refused to do so because he did not want that information to go to the Child Support Agency. He was warned that if he did not inform the Tribunal about the personal account, it may make an adverse finding and assume that cash income is going into it.[14]
[14] The transcript at 14
The father did not provide details of which financial institution held an account in the name of the business. He gave evidence that he opened the business bank account in the name of his wife after the Child Support Agency took his money.
He did not disclose records of his share transactions. He was not able to answer questions about when vehicles were purchased. He was not able to answer with which institution he had a car loan. He was not able to answer how a deduction was calculated from the interest on his mortgage over the Property B property.
As I have said, the Tribunal warned the father that it may make adverse findings against him. As Halligan FM pointed out in Agrippa & Horton (SSAT Appeal)[15], referring to a number of authorities, such as Weir & Weir[16] and Black & Kellner[17], a party has a duty in proceedings under the Family Law Act 1975 (Cth) to make full and frank disclosure of all of his or her financial circumstances. In the same way this must apply in the assessment of child support. I agree with Halligan FM that, if the SSAT is satisfied that a party has made a deliberate non-disclosure of his or her financial circumstances, it should be reasonably robust in assessing the non-disclosing parent’s financial circumstances adversely to that parent and in favour of the other parent. Although the SSAT did not explicitly make a finding of deliberate non-disclosure, it was clear that it was not satisfied with his evidence and gave him the warning, to which I have referred.
[15] Agrippa & Horton (SSAT Appeal) [2010] FMCAfam 1144 at 24 and 25
[16] (1993) FLC 92-338
[17] (1992) FLC 92-287
The father criticised the SSAT because it had examined the financial circumstances of his business. He submitted that it had failed to understand that the financial resources of his business were not personal income, and therefore not relevant to a consideration of his personal income.
Where a liable parent is the proprietor of a company, the SSAT has an obligation to carefully examine all of the financial evidence in respect of that company. That principle was expressed in the case of Ladd & Child Support Registrar & Anor (SSAT Appeal)[18], which was relied upon by the father. In that case, Sexton FM held:
…the Tribunal failed to understand that it needed to look at the whole of the financial evidence of the appellant, including the financial records of his company, in the context of determining what the actual personal financial resources of the appellant really were. This required a careful analysis of the personal benefits the appellant actually had available to him from the company, (such as the car, telephone, drawings and salary).[19]
[18] [2010] FMCAfam 23
[19] Ibid at 31
I am of the view that the SSAT was correct in closely examining all relevant financial information to determine the personal benefits available to the father.
The father submitted that the SSAT used incorrect figures when assessing his financial circumstances. He referred to paragraph 37 of the Decision, in which the SSAT set out a table of his financial circumstances. In his affidavit filed 4 August 2011 he set out what he believed to be the correct figures, based on his “actual tax returns.” An examination of the income tax returns, which were before the SSAT, indicates that the Tribunal detailed the figures which appear on those documents.
The father asserted that the SSAT used incorrect figures at various other points in its reasoning. He said that some of the figures were incorrect because of mistakes made by his accountant. He submitted that the SSAT should have “picked up” those errors.
I accept the submission of Counsel for the mother that it is not reasonable to expect the SSAT to undertake an independent forensic audit of the father’s accounts. The onus is on the father to present his financial affairs in “a manner which is both transparent and readily understandable.”[20] It is not for the SSAT to “embark upon some tortuous process of audit in the absence of such transparency and accessibility.”[21]
[20] Morse & Potts (SSAT Appeal), above n 11, at 79
[21] Ibid
The SSAT had regard to the details of his expenditure in his financial statement and to the other financial documents provided by him. It had regard to the principles established by Gyselman & Gyselman[22] about what commitments are regarded as necessary to enable a parent to support himself. The Tribunal was aware that an obligation to pay debts may amount to a commitment necessary for financial support, but that it was a matter of judgment and degree in each case. I consider that it was open to the Tribunal to find that these expenses were ordinarily incurred and did not reduce the father’s capacity to financially support his children.
[22] (1992) FLC 92-279
In respect of the father’s business income, the SSAT concluded as follows:
43. … that [the father’s] reported business income in his taxation return is below what he actually receives. It was not possible for the Tribunal to determine exactly what income [the father] did earn, but given the calculation above, a conservative figure was determined to be an additional $25000. This was based on the apparent discrepancy in gross income reported and [the father’s] estimate of the hours he charges for ($33113) and allowing for some error in his estimation (in [the father’s] favour).
The Tribunal questioned the father about his charges for his work. He gave evidence that he works 80 hours per week and charges for 40 hours per week at the rate of $40.00 per hour.[23] The Tribunal had regard to this oral evidence about his hourly rate, his hours worked and his expenses and was able to calculate an estimate of his income.
[23] The transcript at 21-22
The Tribunal was unable to determine exactly what income the father receives and determined “a conservative figure.” I consider that the finding made by the Tribunal that his declared business income was below what he actually receives was open to it on the evidence before it.
The father submitted that the Tribunal did not take into account money owed to him by the creditors referred to in Exhibit “1”. I accept the submission of Counsel for the mother that these amounts were insubstantial, if the legal costs of $5,000.00, of which there was no evidence to corroborate, and the debt “caused by the Child Support Agency” of $18,702.00, are disregarded. I consider that the SSAT was entitled not to place any weight on the outstanding creditors in these circumstances and given the evidence before it.
I consider that there was evidence before the Tribunal which was rationally capable of supporting its finding that the father’s declared business income was below what he actually receives. The Tribunal did not make any factual errors sufficient to render its finding that his declared business income was below what he receives, “perverse or unreasonable,”[24] and sufficient to amount to errors of law.
[24] Tasman & Tisdall above n 14, at 44; and, Apthorpe v Repatriation Commission (1987) 13 ALD 656 at 666
As part of its determination, the Tribunal examined the interest expenses claimed by the father in respect of a loan account. That loan was taken out in 2004. As at 16 November 2010, the balance of that account was $139,478.00. This figure came from an Account Balance Summary for that account, which was before the Tribunal.[25]
[25] The transcript at 44; see, document “A7, F1”
The Tribunal made findings about the expenditure of the loan. It calculated that the following amounts had been borrowed for the following:
Rental property $34,260.00
Tools, equipment and current vehicles $22,959.00
Previous vehicles $10,000.00
Share purchases $5,417.00
Based on these figures, the Tribunal found that the father had business and rental property expenses totalling $72,636.00. The Tribunal found that, of the account balance of $139,478.00, there was therefore a total of $66,838.00 unaccounted for. The Tribunal found that this sum had been used by him for private purposes. Accordingly it added back to the business profit the interest of $8,893.00 incurred on the loan, which should have been treated as a private expense.[26]
[26] The decision at 48
In respect of the Tribunal’s finding of the sum of $66,838.00, being the unaccounted expenditure from the business loan, the father submitted that there was $18,447.00 unaccounted for, and that if he or his accountant had been asked, he would have accounted for it.
He submitted that the Tribunal made an error in finding that he had borrowed $5,417.00 to purchase shares. He submitted that the actual figure the Tribunal should have used was $14,152.00, which represented his initial share purchase in 2007.
The Tribunal reached the figure of $5,417.00 based on the cash book[27] and on the oral evidence of the father.[28] An examination of the Transcript reveals that the Tribunal questioned him extensively about his share transactions.
[27] Document “A6”
[28] The transcript at 32
He gave evidence that in 2007, he used the sum of $14,152.00 of the loan to purchase shares. Over the next year, he traded those shares. He did not use any further funds taken from the loan amount to purchase additional shares, he merely bought and sold shares using the profits accumulated from the initial purchase with the sum of $14,152.00.
In addition to applying those profits to the purchase of further shares, he used those profits to pay for medical expenses. None of the profits were used by him to reduce the loan. They either went into share purchases or towards medical bills.[29]
[29] The transcript at 33-34
In 2008, he sold the last of his shares. From the initial purchase in 2007 to the final sale in 2008, he made an overall loss of $5,417.00.
The Tribunal used this figure because it represented the balance of the profit and loss derived from the share transactions. It relied on the father’s evidence and the cash book in its inquiry on this issue. He did not disclose bank statements. He was not able to give evidence about specific share sales and purchases, or payments towards medical bills.[30] He acknowledged that the cash book did not represent a record of transactions made on the trading account of the business, and that the share purchases and payment of medical bills were made on some other account, which was not available to the Tribunal.[31]
[30] The transcript at 35
[31] The transcript at 35
Whereas the Tribunal may have made an error about the share purchases in its calculation of the expenditure of the business loan, it did so in the context of unsatisfactory evidence, and lack of disclosure by the father. I consider that there was evidence rationally capable of supporting the finding and does not amount to an error of law. In any event, the difference between $14,152.00 and $5,147.00 results in interest of $652.00, at the rate of 7.25% used by the Tribunal. This difference is not of such magnitude to amount to an error of law.
The father also submitted that the Tribunal made an error in respect of funds borrowed for tools, equipment and vehicles. He provided figures which he believed to be correct. The difference between those and the Tribunal’s figure was minimal - approximately $1,810.00. I am of the view that such an error would not significantly affect the calculation of interest, and even if the father is correct, would not represent an error of such magnitude as to give rise to an error of law.
The father submitted that the sum of $1,699.00, being the total of $699.00 (25% of interest costs) and $1,000.00 of running costs, added to his income for private expenditure on his Subaru motor vehicle, was incorrect. There was evidence which justified this finding of the Tribunal in the 2010 income tax return. The depreciation schedule in the 2010 return showed 25% of the total claimed for depreciation or $1,068.00 had been allocated for private use of the Subaru. The father submitted an error of $30.00 had been made by the Tribunal in its calculation, as the correct figure was $669.00. This error is not of such magnitude to amount to an error of law.
It was open to the Tribunal to find that the depreciation costs of $6,546.00 claimed by the father should not reduce his taxable income in the 2009-2010 financial year because they were not an actual cost in the year claimed and it noted that he did not have a savings account to put money aside to replace the items depreciated.
Grounds one and three are not made out.
Ground four
The father submitted that an error was made in respect of amount of $10,000.00 attributed by the Tribunal to borrowing expenses for previous motor vehicles. An examination of the transcript reveals that the Tribunal did not question the father about the Toyota and the Jeep. Nevertheless, the Tribunal asked him about expenses incurred on the business loan account. He gave evidence that those expenses included the purchase of motor vehicles:
MS SCHIWY: Which motor vehicle?
[THE FATHER]: It was a Commodore.
MS SCHIWY: So when was that?
[THE FATHER]: There was also a Jeep
Cherokee(omitted). There was a Commodore. Paid out existing combined loan, there was a Toyota. It has also purchased two vans over the years.MS SCHIWY: What Commodore are we talking about?
[THE FATHER]: (omitted), I think it was.
MS SCHIWY: And what (omitted) model Commodore?
[THE FATHER]: Sorry, it might have been later than that. It might have been (omitted).
MS SCHIWY: And when was that purchased?
[THE FATHER]: Good question, don’t know, and I’m not an accountant.[32]
[32] The transcript at 16-17
The father was further asked about the depreciation schedule in the 2010 income tax return, which referred to a Ford van, a Mitsubishi van and a Subaru. He said that was correct and when he was asked about purchasing a Jeep and a Commodore, he answered that that was some years ago.[33]
[33] The transcript at 22
The Tribunal had before it the business records which the father supplied, including the “cash book”. He gave evidence that the cash book was a record of all of the income and expenses.[34] He was questioned about the purchase of motor vehicles with his business loan, and he was given opportunity to give evidence about when those vehicles were purchased and whether or not they were sold. The SSAT stated that the cash books noted the purchase of a Toyota and a Jeep in earlier years and noted that these vehicles did not appear in the 2010 business accounts. The SSAT said:
[34] The transcript at 35
45. [The father] said that he had initial set up costs with the business as he had to buy various tools and equipment and motor vehicles.
…
Earlier vehicles
The cash book notes purchases in earlier years of a Toyota and Jeep for a total cost of $18837. The Tribunal did not question [the father] about these vehicles but assumes that as they no longer appear in the business accounts they have either been sold or they are in private use. If they were sold the sale proceeds should have been used to offset the loan. If in private use, the interest expense to finance the purchase should not be claimed as a business expenses. The Tribunal does not know if they were sold, or if so, what the sale price was but assuming the vehicles were sold for a conservative estimate of $8837 the Tribunal assumed a net cost of another $10000.
I accept the submission of Counsel for the CSR that the conclusion of the Tribunal that the vehicles were either sold or in private use was made in the context of evidence capable of supporting the conclusion. The vehicles were not included in the 2010 business accounts. I consider that it was open to the Tribunal to conclude that the father’s total borrowing costs in respect of the vehicles was $10,000.00.
Ground four is not made out.
Grounds Two and Five
Grounds two and five are related in that the father submitted that the SSAT erred in law by failing to afford him procedural fairness, by not referring him to the publications “What Jobs Pay” and the “Costs of the Children Table”.
a)Ground two
[The SSAT] erred in law and failed to provide natural justice to the Father by considering the publication “What Jobs Pay 2010-2011” without providing [the father] the opportunity to consider that publication and provide submissions in respect of it.
b)Ground five
[The SSAT] erred in law and failed to provide natural justice to the Father by considering evidence of “the costs of children tables on which the child support formula usually operates”, without providing the Father with the opportunity to consider that material or provide submissions in respect of it.
In respect of ground two, it was agreed by the parties that the SSAT did not mention the publication “What Jobs Pay” during the hearing.
Counsel for the mother submitted that the father was mistaken about the use made by the Tribunal of “What Jobs Pay”. She submitted that the publication was not relied upon in making a finding of fact, and it is clear from paragraph 38 of the decision that the Tribunal had considered the publication prior to hearing the father’s evidence. As a result of its examination of the publication, the Tribunal formed an opinion that his income seemed low, which it then put to the father at the hearing. He was given the opportunity to explain. Counsel for the mother further submitted that the Tribunal used the publication to ask him questions about the figures provided by him.
Counsel for the CSR also submitted that the SSAT formed the view about the father’s declared income after it referred to “What Jobs Pay”. It then questioned the father at length about his income and gave him the opportunity to rebut and qualify the view expressed that his income appeared low. He was warned by the SSAT that its decision may result in an adverse outcome for either party. Counsel submitted that the publication was not used to calculate the father’s adjusted taxable income. That was done by the Tribunal after hearing the evidence.
In the authority of Kioa v West,[35] the High Court of Australia considered in what circumstances an administrative Tribunal such as the SSAT should provide parties with the opportunity to make submissions on a piece of information known to the Tribunal but not known to the parties.
[35] (1985) 159 CLR 550
Although the Tribunal must provide procedural fairness, the level of that requirement depends on the circumstances of the case, the nature of the inquiry and the subject matter. As noted by Wilson J in Kioa v West[36]:
What is fair will depend… on the particular statutory framework within which the decision is taken. Even within the same statutory framework differing circumstances may call for a different response.[37]
[36] Ibid
[37] Ibid at 601
In that same case, Mason J (as he then was) stated:
..the importance which the law attaches to the need to bring to a person’s attention the critical issue or factor on which the administrative decision is likely to turn so that he may have an opportunity of dealing with it.[38]
[38] Ibid at 587
Mason J further stated that:
The applicant is entitled to support his application by such information and material as he thinks appropriate and he cannot complain if the authorities reject his application because they do not accept, without further notice to him, what he puts forward. [39]
[39] Ibid at 587
Paragraph 40 of the Decision indicated that the Tribunal put to the father that it believed his income was low:
40. It was put to [the father] that given his low income (and losses) it appeared he was understating his income. [The father] said that he never gets paid in cash. He said that he charges significantly less than other (omitted) for his labour; it is the only way he can successfully quote.
This is borne out by an examination of the transcript:
MS SCHIWY: Okay. I am still concerned about how low your business income is, given what you do. Do you ever receive cash income from your customers?
[THE FATHER]: No.
…
MS SCHIWY: It is a very low income for a (omitted), for someone doing what you’re doing.
[THE FATHER]: Well, a (omitted) normally charges $70 to $80 an hour. The type of work I’m doing, if I quoted that, I would never get work.[40]
[40] The transcript at 28-29
As I have said, the Tribunal questioned the father at length about his business income and expenses, including his hourly rate, the number of hours he works and about the cost of materials.[41] He said that he works at an average rate of $40.00 per hour for an average of 40 chargeable hours each week.
[41] The transcript at 19-25, 28-31
At paragraph 41 of the decision, the Tribunal explained why it believed his income to be low:
41. The Tribunal noted that 40 hours per week at $40 per hour (over 46 weeks to allow for holidays and other ‘leave’) amounts to $73600. If [the father] was charging for materials correctly, according to his own evidence, his annual income in 2010 should have been approximately $119322 ($73600 + $45722 for materials), however in his taxation return he declared only $86209 – a discrepancy of $33113. If the higher figure were used it would still only result in a net profit of $30788; which is still significantly less than a (omitted) working for salary and wages.
The Tribunal based its finding about his income from the father’s own evidence. This is clear from paragraph 43 of the Decision.
I consider that there has not been a failure by the Tribunal to afford procedural fairness to the father. Accordingly, ground two is not made out.
In respect of ground five, the father asserted that the Tribunal failed to afford him procedural fairness by not referring the publication “Costs of Children” to him. The costs of the children, as set out in the mother’s statement of financial circumstances were not challenged by the father.
In its Decision, the Tribunal held:
68. In determining the proper needs of the child, subsection 117(6) of [the Assessment Act] requires the Tribunal to have regard to the manner in which [the children] are being and in which the parents expect them to be cared for, educated or trained and any special needs of the children.
69. As observed by Justice Lindenmayer in the matter of Dwyer v McGuire (1993) FLC 92-420, subsection 117(9) of [the Assessment Act] provides that the matters set out in subsection 117(4) of [the Assessment Act] are not exclusive and, as a result, evidence of the published research of acknowledged experts in a particular field of speciality (such as the costs of maintaining children) is admissible. Having regard to the costs of children tables upon which the child support formula usually operates the Tribunal concluded that the costs usually attributed to children of [the children’s] age, where the parents’ incomes are as found by the Tribunal, would be about $7850 per annum.
Part 5, Division 6 of the Assessment Act sets out the method of calculating the costs of children. Section 55G provides that in order to calculate the costs of the children, reference must be had to the Costs of the Children Table. Section 4 of the Act defines the “Costs of the Children Table” as the table set out at clause 1 of Schedule 1 of the Assessment Act.
The Child Support Agency reproduces the Costs of the Children Table on its website.[42] That reproduction includes the figures derived from the current annualised MTAWE figure. This is the table to which the Tribunal referred in the decision at paragraph 69.
[42] >
I was referred by Counsel for the mother to the case of Eades & Cadell (SSAT Appeal)[43]. In that case, Slack FM considered the material to which the SSAT is entitled to have regard when considering the needs of the child pursuant to s.117(4)(b):
[43] [2009] FMCAfam 275
22. In considering the proper needs of the child [s.117(4)(b)], the SSAT:
a. would ordinarily consider the evidence of the parties about the needs of the children to assess the reasonableness and quantum of those needs;
b. may have regard to published guidelines as to the needs of the children (see Hallinan & Witynski at 94,323).
c. may also have regard to the costs of children used in the assessment of child support under the existing formula arrangements [although it is not sufficient or appropriate to rely upon the formula to perform that task, Lindenmayer J in Dwyer & McGuire (1993) FLC92-420 (and see also Gyselman (supra) at 79.078)].
The Tribunal had before it the evidence about the costs of the children in the financial statement of the mother. It said that the direct costs in providing care to the children were taken into account in assessing the proper needs of the child.[44] The Tribunal was entitled to refer to the Costs of Children Table as part of its consideration of s.117(4)(b), as noted in Eades & Cadel.[45]
[44] The decision at 79
[45] Above n 43
The question is whether the Tribunal was required to bring the Table to the attention of the father. I note the principles expressed in Kioa v West[46], cited above.[47] As noted by Mason J (as he then was), the key aspect of the requirement for procedural fairness is to bring “critical issues or factors” to the attention of an applicant.
[46] Above n 35
[47] Above n 38
The costs of the children were not an issue in the review by the SSAT. The mother included costs of the children in her financial statement and the father did not take issue with that.
In my view, in this context, it was not a failure of procedural fairness for the Tribunal not to inform the applicant about the Table and in the context of the costs of the children not being in issue.
Accordingly, ground five must fail.
Conclusion
The father has failed to establish any grounds for appeal. Accordingly, I dismiss his application.
I certify that the preceding ninty-three (93) paragraphs are a true copy of the reasons for judgment of Baker FM
Date: 26 July 2012
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