Telama and Telama

[2009] FamCA 1036

FAMILY COURT OF AUSTRALIA

TELAMA & TELAMA [2009] FamCA 1036

FAMILY LAW – MAINTENANCE – arrears - interim spousal
FAMILY LAW – CHILD SUPPORT – departure from administrative assessment

Family Law Act 1975 (Cth)

APPLICANT: Ms Telama

RESPONDENT: Mr Telama

FILE NUMBER: SYC 1450 of 2008

DATE DELIVERED: 1 October 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Loughnan JR

HEARING DATE: 1 October 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr P. Campton

SOLICITOR FOR THE APPLICANT: Barkus Doolan Kelly

COUNSEL FOR THE RESPONDENT: Mr G. Gould

SOLICITOR FOR THE RESPONDENT: Karras Partners Lawyers

Orders

1. Leave is granted to inspect documents produced on subpoena by the National Australia Bank and the ANZ Bank.

2. Orders are made in terms of paragraphs 1 and 2 of the “Minute of Order Sought by the Wife” marked Exhibit A, substituting in each case for $2,000.00 the figure $1,000.00 as follows:

   “1.That within 48 hours, the husband pay to the wife by way of arrears in spouse maintenance, the sum of $1,000 per week from 7 August 2009 to the date of the making of these Orders.

   2.That pending further Order, the husband pay to the wife by way of spouse maintenance, the sum of $1,000 per week, with the first payment to be made 7 days after the date of the making of this Order, and thereafter by way of fortnightly instalments in advance.”

3. That there be a departure from the administrative assessment fixed as a result of a decision made on 7 August 2009 by Senior Case Officer W to provide that the annual rate of the husband’s child support liability for the parties’ children is a total of $78,000.00 AND the Court noted that that includes a contribution to the additional costs of the children’s special needs and the manner of their education of $13,000.00.

4. That departure is to commence on 7 August 2009 and conclude at the conclusion of the period of the current assessment.

5. That the parties’ costs of and incidental to the proceedings today be reserved.

6. That leave be granted to the parties to restore the matter to the list by arrangement with Judicial Registrar Loughnan’s associate on giving 24 hours’ notice to Judicial Registrar Loughnan’s associate and the other party in relation to any application for a stay on the basis of an Application for Review.

IT IS NOTED that publication of this judgment under the pseudonym Telama & Telama is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 1450 of 2008

MS TELAMA

Applicant

And

MR TELAMA

Respondent

REASONS FOR JUDGMENT

1. These are proceedings in relation to spousal maintenance and child support departure in circumstances where there are on foot final proceedings for those forms of relief in addition to parenting proceedings. The matter has been allocated to the docket of Rose J.

2. In the matter before me today the wife seeks a payment of $2000 a week by way of spousal maintenance from 7 August 2009 and ongoing until further order.  She seeks that there be a departure from the child support assessment backdated from 6 August 2009 ‑ I am not quite sure why it is a different day ‑ to today's date, and then she seeks, going forward, periodic payments in the sum of $4000 a week and payments of school fees, irrespective of the school, Medicare payments and gap expenses, and those things are to be substituted for any administrative assessment.  I gather the husband simply opposes those orders. 

3. The parties were married in 1996 and separated in 2007.  They have four children, S, C, K and J who are ten, eight, seven and four years of age respectively. 

4. The proceedings started in 2008, and orders were made, including on a number of occasions by me, arising out of interim applications.  The proceedings started in March 2008.  Orders were made on 23 April 2008, 4 June 2008 and 18 June 2008. The parties were divorced on 19 June 2008. Orders were made on 28 July, 1 August, 2 September, 4 September and 15 October 2008. The matter was allocated to Fowler J and on 18 December 2008 final orders for property and parenting were made in terms agreed between the parties.  The husband was then acting on his own account. 

5. The parenting orders were a bit unusual.  The children were to live with the wife and the husband was to have reasonable time with the children as agreed.  Ultimately there was some time specified. The parenting issue has not been satisfactorily resolved.  I understand there is an expert's report coming and the parties are looking to doing something about that later in the year. 

6. In relation to settlement of property, in effect the wife was given the opportunity to take over the mortgage on a property at B.  The mortgage was noted, at the date of the orders, at $1.7 million and she was to be responsible for a taxation liability incurred by the husband. An expert was appointed to identify what that liability would be, and I have been told today it is something of the order of $400,000.  In the event that the property could not be refinanced it was to be sold and the net proceeds paid to the wife. 

7. There was a brief hearing before Fowler J on the day the consent orders were made and his Honour described the settlement in this way:

   It seems that the husband is left with charm and good looks and earning capacity and intellect -

   and by inference not much more than that. 

8. There was a splitting order as to 100 per cent or thereabouts of the husband's superannuation interests. Virtually all of the assets went to the wife. 

9. His Honour went through it with the husband and confirmed his consent. He asked the husband if he felt he had the necessary emotional stability to agree to orders and the husband said he believed he did. He said he understood the nature of the orders about the superannuation and his Honour said:

   Do you understand that notwithstanding my making of these orders there will be an outstanding issue both as to child support and spousal maintenance which, as pointed out, very much depends on your future earnings and earning capacity -

   and the husband agreed that he understood that those matters were still on foot. 

10. Frankly, I do not really understand what the net effect has been on the wife of the settlement of property.  Literally, as at July, she said she had the 100 per cent interest in a home at B with an estimated value of $3 million; some small amounts in some bank accounts but $127,000 with the Bank of Queensland and another $15,000 with that same bank; a motor vehicle; some jewellery and other personalty; and $93,000 by way of a superannuation interest. As to debts, she owed $1.3 million on the home mortgage and an estimated $450,000 by way of tax liability for the husband. Since then the mortgage may have gone up by way of refinancing. 

11. As to the husband, he says he has a modest amount in bank accounts; a motor vehicle worth $60,000 or thereabouts; an interest in two businesses, D Pty Ltd, which I think is the corporate vehicle used for his consultancy services, and T Pty Ltd.  He says they have no value. 

12. He has no superannuation. I am not quite sure what that means.  In the same document he says he pays $754.76 a week into superannuation, so I am not quite sure about that. 

13. In relation to the companies, he says T Pty Ltd owns a development property in Queensland.  He says it has a facility for $1.9 million used to purchase that property and to fund associated expenses. The purchase settled in July and he says the property is worth $1.454 million.  So the net position he would say, for that company, is at a negative value. He says D Pty Ltd owns an option over a second development site in Queensland and that is how he gets to those valuations. 

14. By way of background, the husband was I think the managing director of one of the organs of N Company and he was made redundant from that position.  He says he has had difficulty in obtaining paid employment.  He had a short job on a contract in China and more recently he has been in receipt of payments of $2000 a day by way of a consultancy arrangement. He says that arrangement comes to an end at the end of this month. 

15. The wife was substantially out of paid employment during the marriage and it seems to be an agreed position she will not return to paid employment until next year.  The youngest child starts school next year and the husband said something to the child support review officer consistent with him anticipating the wife undertaking a period of retraining even though he asserts that she has significant qualifications and achieved at a high level since High School. 

16. There is a child support assessment and a child support review officer recently looked at the departure application lodged and the most recent assessment runs at I think about $879 a week, being a rolled up figure for the four children. 

17. Turning first to the question of spousal maintenance, it is a right that is attracted by the fact of a marriage. The effect of section 72, section 74 and section 75, as they would apply to this case, is that if the wife is unable to adequately support herself from her own resources for any adequate reason, I can order that the husband provide support to the extent of his reasonable capacity to do so.

18. I think the position is that there is no absolute threshold dispute but there is certainly a dispute as to quantum.  It follows to some extent, from the concessions that were made in the child support process, that the husband does not expect that the wife would be in paid employment at this stage.  She has four children under 10. Sadly, the current arrangements have her largely responsible for their care.

19. It is very much the husband's case that in making the election she has in respect of her property settlement the wife has arranged her affairs so that not only is no component of her property settlement applied to her ongoing support, but that she has exposed herself to borrowings. That means she has a massive weekly deficit arising solely out her provision of her own accommodation. 

20. As to the need for support, in a case reported as M & M (2006), the Full Court summarised the authorities in relation to the threshold position, particularly Mitchell & Mitchell, as follows:

    The question whether an applicant support him or herself adequately is not to be determined by reference to any fixed or absolute standard but by having regard to the matters referred to in section 75(2).

    That comes from Mitchell.

    The question is not to be determined on a subsistence level but by considerations of whether the applicant can support himself or herself adequately, importing a standard of living reasonable in the circumstances.

21. That comes from Mitchell, Evans, Brady, Gamble, Wilson and Bevan:

    It is not necessary for an applicant for maintenance to use up all of his or her assets and capital in order to satisfy the requirement that he or she is unable to support him or herself adequately.

22. That comes from Mitchell and then there is a reference to the matter that Mitchell dealt with, which is the fact that unless there is full employment, there is not necessarily a job for everybody.

23. In M & M the Full Court went on in relation to the appeal before it to say:

    Thus, in our view, the trial judge was required to consider whether employment was available to the wife having regard to the practical realities of her age, experience, confidence, having been out of the work force for a number of years, and if so, the level of income the applicant might earn from such employment, whether the circumstance of this case, such income fell below adequate support and thus met the requirements of section 72.

    As I say, I do not think that is a relevant issue here. 

24. The thorny issue is the way the wife dealt with her property settlement. 

25. In Bucknell & Bucknell [2009] FamCAFC 177 the Full Court heard an appeal from a federal magistrate. In dismissing the appeal the court considered the federal magistrate's approach to the husband's future accommodation costs and said:

    Mr Cooper argues that, in setting the reasonable expenses of the husband for accommodation at a notional rent of $800.00, rather than accepting the outgoings on the husband’s Victorian property at $1,208.00 per week, Purdon-Sully FM erred.  He submits that the Federal Magistrate did not and could not have found that the latter payments were unreasonable.  Rather, her Honour seemed to have rejected the payments because they were unilaterally incurred.

    We do not accept these submissions.

    Though, as seen in paragraph 102 of her reasons, the Federal Magistrate noted that there had been no challenge to the reasonableness of the husband’s expenses in cross-examination, in our view her Honour was there referring to the quantum of those expenses, of itself.  In our opinion her Honour correctly saw that the argument about whether the accommodation expenses had been reasonably incurred post-separation, remained open in submissions.  Further, in our view, when the learned Magistrate referred to the expenses as being unilaterally incurred, that was an observation forming part of her consideration of the reasonableness of incurring of the expense, as against the loss of the capacity which the husband had before it to support the wife.

    The court noted:

    There is ultimately no challenge before us to Purdon‑Sully FM's findings as to the wife's need.  Had the wife acquiesced to the husband taking on additional commitments, that may have affected the reasonableness of the husband doing so.

    Mr Cooper also argues there was no evidence before the federal magistrate that the husband was intending to, or could sell, the Victorian property and find a rental property for $800.  However, Mr Cooper does not argue that the federal magistrate's findings in paragraph 103, that the husband is considering selling the Victorian property, was unfounded.  Nor does he argue that her Honour's findings, that the husband's evidence was that before purchasing the Victorian property he had rented for about $800 a week, was unsupported. 

    Going on:

    The opening words of section 72 of the Family Law Act are:

    A party to a marriage is liability to maintain the other party to the extent that the first mentioned party is reasonably able to do so if, and only if, the other party is unable to support herself or himself adequately.

    In our view, it was part of her Honour's task to subject the husband's capacity to maintain his wife to scrutiny.  That involved an examination of the reasonableness of his expenditure.  This her Honour carried out and she came to a conclusion which in our view was well open to her -

    and it seems to me that that argument must hold good in relation to both the payer and the payee. 

26. There is a property settlement.  We know that no component of that property settlement is child support or spousal maintenance and that's because the legislature has said if you put $1 of spousal maintenance into a property settlement order you are required to flag it in the order. As to child support the basis of jurisdiction is very different compared to property settlement. 

27. And I accept minds might differ about this but I do not think an applicant for maintenance is free to apply all of a property settlement of in excess of $1 million to his or her housing needs and then incur a further costs in the form of borrowings to maintain that housing need and then seek that those expenses be subsidised by somebody else. The reciprocal is also true.  I don't think the husband is free to say that "Irrespective of my capacity and my financial circumstances, I have decided to incur housing costs of an extraordinary amount and that reduces my capacity to provide support". That does not arise here as he received little property settlement. 

28. So while one might argue about his own accommodation costs and whether that is an odious comparison with the circumstances in which the wife finds herself, and even now I am a bit unsure what his rent is but it could be $1200 a week. 

29. That strikes something of a blow to the wife's claim. Otherwise, I do not think there is much in the husband's complaint about excessive expenditure. The wife says she spends $1959 a week. 

30. There has been an effort here to recast schedule N for the Financial Statement so that the outgoings are all in a different order. The wife says that she spends $1774 a week in various expenses and she updates in her latest affidavit some of those to bring up another $185 a week. Thus she spends $1959. 

31. She claims $200 a week for food. The husband spends $300. She claims $200 a week for service and repairs to a motor vehicle. She claims $100 per week for travel and holidays.  The husband spends $200 a week on his holidays. She claims for cleaning.  It seems to be common ground that there was a cleaning expense incurred by the parties during the marriage.  There is nothing outrageous. 

32. This is a demeaning, if necessary, process. It is sad that this has to happen but there it is. In a hearing conducted on the papers I am not permitted to make a finding of fact on a disputed issue of fact without independent evidence that wholly supports one version of events or excludes the other. The husband does not say, "These amounts are not spent."  His dispute is that they are unreasonable in respect of a couple of categories that I have mentioned.  His own expenses seem to compare reasonably favourably with the sort of expense that the wife has, and I accept that this may well be the sort of thing that the parties did, if not more, during the marriage. Thus the wife claims $1,959 per week.

33. What to do about accommodation costs?  It seems to me that it is not an unreasonable position on the bare facts of the property settlement before the court that the wife's accommodation costs could be addressed by her property settlement.  Minds will differ about this.  Mr Gould would have it on behalf of the husband today that the wife could have made arrangements to address those accommodation costs and to provide something towards her own support by the property settlement, and that is true, and it does not say anywhere in section 79 that parties are entitled to be properly housed out of their property settlement. The husband has virtually no property settlement and cannot make provision for his own adequate housing in this case.  In case where there is a large pool it is often possible but not one per cent or dollar priority would be given in these circumstances to that being achieved. 

34. It is true that the parties lived in similar accommodation to that which the wife now occupies, literally, similar accommodation. They lived in her house. Thus we know that that is not an inappropriate standard for the wife and children to live but that all has to come back to whether that is practicable or not. 

35. So as I say, minds will differ about this.  I am making decisions on an interim basis.  As I said to counsel during the hearing, the scope for any damage I do to be repaired is reduced a bit here because the parties have finalised their property settlement. For that reason I need to be careful about not overshooting the mark. There is no scope for remedying an incorrect order short of one of the parties filing a review and having somebody wiser, reconsider the issue.

36. The approach I will take is to make no provision for the wife's accommodation – in other words to assume that her accommodation needs should be addressed by her property settlement. That will flow through to the issue about child support, which leaves her with weekly needs of $1575. 

37. As to the husband's capacity, there is a couple of things there.  Firstly, in the broad, I rejected an application to adjourn the case today because of the termination of the husband's period of employment under the current contract or consultancy at the end of this month. I did that because there has been significant volatility in the financial circumstances of the parties for the last 18 months.  Today was set aside at an event at which both parties attended and there was a collateral agreement from the husband that he would abide a back dating provision, taking any award that was made today, back to a date in August. That is why the wife’s applications are expressed the way they are. He knew when he agreed to have the matter fixed for hearing today, what he knows now. He knew then that his contract would conclude at that time. All that can have happened in the meantime is that he has made efforts to secure other contracts and he has not been successful. 

1. I also refused the adjournment because of the fact that the parties had committed themselves to today. They had incurred costs already for today.  The court costs had been lost as far as any other cases went.  There is a recent High Court decision of Aon Pty Ltd which reinforces the importance of taking into account the needs of the community and the needs of other cases in the queue in making these sorts of decisions. 

2. So because of those things and particularly because I was invited by the husband to have the matter heard today and nothing had changed except the effluxion of time, it seemed to me that the matter should proceed. As a related topic there is a choice to be made about which of the parties would be obliged to bring the matter back if circumstances do change. Do I make an order and leave it run indefinitely, which means that it is likely the husband would be the one who would have to bring the matter back to argue that the order should be interfered with?  Or do I make an order until the end of the month and require the wife to bring the matter back and argue the case again?

3. The subtext of the proceedings, and the reason why the property settlement was so skewed in the wife’s favour is that the husband is in the superior financial position.  He, uniquely, will be the one possessed of the information which would enable the matter to be explored again.  The wife will not know anything. So it seems to me that the person with the knowledge and the financial position should bring the matter back. 

4. I propose to make orders until further order. However, it follows from my reasons that if the husband has no income, then that will have a significant impact on a ruling on a variation application. Unless there is a lottery win or something of that nature, once they are satisfied that the husband has made every proper effort, one would expect those who advise the wife to give serious consideration to accommodating him in relation to the ongoing expenses. 

5. Coming then to his reasonable capacity. The husband’s income is not straightforward. He has given me a table which says that his consulting income is $40,000 a month or $9205 a week.  Some expenses are incurred by the company D Pty Ltd, including his fees, at $9,141 a week.  He says that then he has some expenses which include mobile phone, Internet and computer depreciation, stationery, office premises, rent at $433.30 a week, heat, lighting and power, cleaning, furniture depreciation and income protection insurance, giving a net income of $8,572 a week.

6. Then he plugs that into his Financial Statement and we trace through his expenses.  In terms of the overall, he says that his expenses are $9,115 a week. Thus he declares a shortfall of $600‑odd. 

7. Expenses that would give way to his obligation to provide spousal support in the short term would include his superannuation contributions. As I said earlier, on the face of the document they are not generating him any benefit at all but assuming the Financial Statement is wrong about that, they are going into a fund that is being built up for retirement and that is something that would give way to necessity in the short‑term. 

8. As to his rent, although it is not reflected in the documents, what his counsel says on instructions is that his partner, Ms X, pays $100 a week. The husband says he pays $666.67 a week in rent.  He says through his counsel that she pays $100 a week in rent, so that is $766, and then there is the $433.30 that is taken out as a business expense in arriving at his net income. That is $1199.97, so I assume his rent must be $1200 a week.  If it is not true then the husband is double‑dipping.  I have no reason to believe that to be the case. 

9. Thus the husband's rental is $1200 per week. I accept the argument made on behalf of the wife that the cost of accommodation for the husband and his partner and hopefully in the future for when the children are staying over, at $1200 a week does not sit all that uncomfortably with her mortgage costs of nearly $2,000. It is not something that is way out of the ballpark. 

10. It is a coincidence that $1200 a week is the figure that the learned Federal Magistrate said was over the odds in Bucknell. That does not help us here.  There is no evidence here that the parties were living in rental accommodation of $800 a week at any point in their lives, so it does not help. 

11. On the same basis as the argument put on behalf of the wife, minds would differ about whether, in circumstances where the husband has obligations to support his wife, to support his children, $1200 is a reasonable rental. 

12. The husband has a motor vehicle lease expense of $407 a week. There is no equity in the motor vehicle. His Mercedes Benz motor vehicle represents a debt of $30,000. Thus there is no benefit to the husband in him getting out of the lease at this stage.

13. The husband makes credit card payments of $1000 a week. He says that has been necessary. He pays $879 in child support. As to his living expenses - he spends more on food than he seems to think is necessary. He must be critical of his own expenditure on food because he thinks the wife’s expenditure on food, at least in relation to some of the children, is a bit high.  He makes a slightly greater provision for hobbies and holidays than the wife although not by much. Like the wife, he has cleaning expenses. 

14. His allowance for gifts would give way to necessity. He spends $750 a week on other necessary commitments which he was required to specify and he does not. 

15. Those are the categories of expense in which there is room to move.  We have overtaken the $600 shortfall and there is scope for the husband providing some support to the wife.

16. The other factor in the case is that in circumstances which he does not set out in his affidavit in any detail and which he was absolutely obliged to set out in detail, the husband has committed himself to significant expenditure associated with a development in Queensland. It was done through a company but the company is him.  He has taken on borrowings well in excess of the value of the property by about $400,000.  The project, he has told lending authorities, and there is some other evidence about it, has development costs of the order of $5 million and it is not a project, on the face of it, that would seem likely to generate income during the course of the project.  I think there is a reference to the development only taking five months or so, so it might not be a terribly long period. However, in terms of making an assessment about the husband's reasonable capacity to provide support that he is obliged at law to provide; and in circumstances where he was obliged at law to make a full disclosure to his ex‑wife all those arrangements and he failed to do so; I can make inferences against him as to his capacity. 

17. It is not a situation, as Mr Gould put, whereby I can assume there will be a dividend from that project and therefore the husband will have an increased capacity to provide support. However, those circumstances speak of a confidence not only in relation to his overall financial position but in relation to the likelihood of him returning to remunerative employment. They suggest that he is confident that, from whatever source, over the medium term he will be able to fund significant additional expenditure.

18. The essence, it seems to me, of interim spousal maintenance is to ensure that parties who would have wanted the best for each other during the course of a marriage deal with each other decently until there can be some resolution as best it can be done separating their finances. In those circumstances it seems to me that the husband should be paying $1000 a week. 

19. Turning then to child support, this court does not have any jurisdiction in relation to child support assessments.  It has a capacity, after a raft of things have been done through the Child Support Agency and the Social Security Appeals Tribunal, to interfere with an administrative assessment of child support. 

20. There is a provision whereby, notwithstanding that all of those steps have not been taken, where the carer and the payer are in litigation in a court and the court finds that it would be in their interests to determine the departure issue, the court can intervene and make an order. 

21. The child support legislation is complex and that is presumably because the Parliament decided that it was best that an administrative scheme deal with children's support. There are relevant proceedings before the court.  They are interim spousal maintenance proceedings and the significance of that is, as I have said, I am not permitted to make a finding of fact on a disputed issue without clear evidence, and there are a lot of disputed issues between the parties. 

22. On the other hand, there are matters between them which will come into being early in 2010 which have already been dealt with under the administrative scheme and the current assessment applies through until June 2010. 

23. The fact that the parties have thrashed around for the best part of two years in our system suggests that they may be people not inclined to sit comfortably with the administrative scheme indefinitely. Once all of the steps have been taken, the parties may bring their case to a court, in any event. 

24. There are advantages both ways.  I have spoken in the course of submissions about the advantages that the child support agency has.  It has direct coercive powers in relation to production of documents.  It does not have any problems in relation to making findings of fact on less than adequate material and it does not have significant problems in terms of informing itself about facts without notifying the parties in advance.  So a very different arrangement. 

25. And the current assessment is well over the capped rate.  There is a rate.  I think it is two and a half times average weekly earnings at which the child support formula runs out of puff. Children in high income families have additional costs and that is borne out in this case. Their parents have capacity for higher amounts of discretionary expenditure and that makes it hard for a formula to work. The assessment, at the rate of $45,000 a year, is well over the formula rate. 

26. To put the parties through the rest of the steps, so the Social Security Appeals Tribunal in the administrative scheme before they come back to this court, is not ideal.  I do not know what the delays of that tribunal are.  I agree that somebody said today there are delays here and locking the parties in, as I would do if I make a departure order, has its own problems, but on balance I think for those reasons it is in the interests of the parties if I address the departure issue.

27. Section 117 of the Child Support Assessment Act says that:

    If, in the special circumstances of the cases at ground, and it is just and equitable pursuant to section 117(4) and otherwise proper pursuant to section 117(5), then the court can grant a departure.

28. On one ground is needed. Here I can be satisfied that:

    In the special circumstances of the case, the application in relation to a child, the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child because of the income‑earning capacity, property and financial resources of the child; the income, property and financial resource of either parent; the earning capacity of either parent; because of any payments and any transfer or settlement of property made or to be made, whether under that Act or the Family Law Act by the liable parent to a child, to the carer entitled to child support or to any other person to the benefit of the child.

    That is 117(2)(c), particularly (i)(A). 

29. What is just and equitable relates to what is fair as between the parents. I am to consider the nature of the duty of a parent to maintain a child; the proper needs of a child; the income‑earning capacity, property and financial resources of a child; the income, property and financial resources of each of the parents; the earning capacity of each parent who is a party to the proceedings; the commitments of each parent who is a party to the proceedings that are necessary to enable the parent to support himself or herself or any other child or other person the person has a duty to maintain; the direct and indirect costs incurred by the carer entitled to child support in providing care for a child; any hardship that would be caused to the child, to the carer, by the making or refusal to make an order and similarly in relation to a liable parent, and to any resident child of the parent otherwise.

30. So they are the matters I am to take into account by reference to the facts of this case. 

31. I have said what I have said about the wife has no income.  To the extent that there is anything in the argument that is made on behalf of the husband that she should be taking care of her own financial support from her property settlement, that is accommodated here because I have committed her in effect to meeting over $500 a week of her own support and on any proper view of her application of her property settlement it cannot be said that the residue after accommodation was addressed would generate $500 a week.  And just as it is not an irrelevant factor that she receive that money, we know that no part of the property settlement was specifically earmarked by the parties for her weekly support. 

32. So the wife has no income and for the purposes of the range of these proceedings that might change.  There is no issue that she has current capacity for her own support by way of paid employment. 

33. There is no suggestion the children have any capacity for their own support.  They do not earn any income or have any property. The focus comes down to the proper expenses of the children and his capacity to pay. Again, I cannot make findings of fact on disputed issues.

34. The wife's case is that the children's expenses are $5,720 a week made up of $1561 for one child, $1411, $1394 and $1314, for the others, plus an increase of $40 a week for the children's medical expenses not accounted for in the Financial Statement. 

35. Now, the first thing to be said about that is there is the same issue about accommodation, and I'm not free to make the same assessment.  There will always be some accommodation costs associated with the children.  As I have said, and I repeat, minds might differ about this but it seems to me, on the reasoning in Bucknell and the logic of the legislation, the parties are not free to have any unlimited accommodation costs.  The principles of the child support scheme are not that the children live in the house they used to live in.  The principles of the scheme are that the children be supported fairly as between their parents; that the support reflect their parents' circumstances; and that as between the taxpayer and the parents the burden is properly shared. 

36. So there will be some housing costs for reasons that are not quite explained in this redesigned part N.  Some fixed costs have been apportioned between the children and some are not.  Utilities and the mortgage have been apportioned but not the rates. I do not know why that would be, as a matter of logic. I accept that there needs to be some component for accommodation. 

37. The other thing to be said about the children's expenses is that they amount to $5720 a week or $297,000 a year after tax. 

38. Now, Mr Gould said on a couple of occasions today it is one thing to lumber the husband with the sort of costs that were met when his income was one million or more.  It is quite another thing to visit them on him now and there is not anything that I have been taken to today that suggests that there is income of anything of that order available.  And the work I do is as a delegate.  Parties are free just to file a review and ask somebody else to have a look at it again. It is important that I do not make an unsustainable order. The order must bear some proper relationship to what is available and whether you talk about it as $5700 a week or $24,000 a month or nearly $300,000 a year, it does not get any better. 

39. There is no evidence that the husband has anything like that capacity and we know that a line has been drawn under his property resources.  The day has gone now where there could be any suggestion of hidden assets because the property settlement has been achieved. 

40. So we have proper expenses of proper categories. It is the husband’s case that the children are being over-serviced in terms of medical expenses. I am not in a position to make a qualitative assessment of that proposition. The wife has been left on watch in relation to four children.  The parties disagree about one child not meeting milestones or having some disability, the husband being more bullish than the wife.  The parties agree that two of the children suffer coeliac disease which affects, among other things, their diet, but they disagree strongly in terms of the financial implications.  The husband says that might be $15 a week in terms of impact and the wife would have a different view. 

41. The task in child support, I would have thought, notwithstanding what the learned review officer has done, where costs are claimed at a very different rate in relation to four children, would be to fix a rate for each child.  I do not propose to do that today.  Notwithstanding the tedious explanation that I have gone through today, the authorities to some extent permit a broad‑brush approach on an interim basis, for the reasons that I have said. 

42. So I will fix a rolled up rate. The husband has told the child support review officer that he thinks that while he has the sort of income that he has at the moment, $5600 a month is a proper rate.  So we know that something a bit more than the current assessment is feasible from his point of view, even before the things that I have said. 

43. We have the fact that there needs to be some inroads into the expenses because of the rationale in relation to accommodation costs. 

44. I suspect some of these payments are not being made.  There is the necessary inexactitude in estimates provided.  The children on no week will eat $200 worth of food.  They might eat $207 worth of food or $184 worth of food but are unlikely to eat $200. Thus there is an artificiality about this exercise and that gives some scope for taking a more general view about it. 

45. There is an issue between the parties in relation to school fees.  The current assessment is fixed on the basis that there is something like $13,000 per annum in fees at parochial schools in respect of the children for the period of the assessment. 

46. The wife says, and she is currently to make decisions in relation to this, that two of the children will start at a higher fee private school next year.  That is the one child at the school the parties had her enrolled in and another child at a different school. 

47. This is a terribly important issue on a personal level because I would have thought you do not want the children starting at a school only to have the embarrassment of being withdrawn from the school later, but that is not a decision that I am able to make or need to make today.  The wife says, through her counsel, they will be going to those schools. So we know they will be starting, even though they are not at High School ages.  They will be starting a bit early at schools next year on a private basis and her commitment to do that is not conditional upon the child support award. This is an important issue. In six years the parties could be up for the best part of $100,000 in fees for these children and ongoing. As the children get older some will cease to attend school but those fees must come from after tax dollars. If you have sent two do you send all?  Anyway, they are issues not before me, and no doubt something that the parties will think about. 

1. Like the review officer, it seems to me that in circumstances where we do not have a firm joint commitment for a path for all the children to go to those higher fee‑paying schools, in circumstances where the matters before the court in relation to parenting issues and a final hearing in relation to this issue hopefully within a year or so, it seems to me that I cannot do anything other than that.  So the extent of the obligation needs to be limited to those parochial school expenses. 

2. The current assessment is $879 a week.  The husband told the child support registrar that his capacity might be something of the order of $1290 a week.  The claim that is made is $5720 a week.  Doing the best I can with the material that I have, it seems to me that the rate should be $1500 a week. 

I certify that the preceding eighty-six (86) paragraphs are a true copy of the reasons for judgment of the Judicial Registrar Loughnan

Associate: 

Date: 2 November 2009