U and U and Anor
[2002] FMCAfam 234
•5 August 2002
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| U & U & ANOR | [2002] FMCAfam 234 |
| FAMILY LAW – Child Support – departure applications. |
| Applicant: | T U |
| First Respondent: | V U |
| Second Respondent: | W M |
| File No: | CAM 2079 of 2002 |
| Delivered on: | 5 August 2002 |
| Delivered at: | Canberra |
| Hearing Date: | 5 & 6 March, 29 May 2002 |
| Judgment of: | Brewster FM |
REPRESENTATION
| Self-represented: | Mr J U |
| Solicitors for the first Respondent: | Mr Brian Brown, O'Connor Harris & Co |
| Self-represented: | Ms Z M |
ORDERS
That the child support payable for L U be assessed as follows:
(a)For the period 1 July 2001 to 30 June 2002 the child support income amount for Mr U is $61,000.
(b)For the period 1 July 2001 to 30 June 2002 an additional amount be payable with respect to L’s special needs of $1,976.
(c)For the period after 30 June 2002 the child support amount for Mr U is $53,019.
That the child support for B U be assessed as follows
(a)For the period 1 July 2001 to 30 June 2002 the child support income amount for Mr U is $61,000.
(b)For subsequent periods the child support income amount is $53,019.
That on the first payday after 1 October, 1 January, 1 April and 1 July each year Mr U provide to the mothers of L and B copies of his pay slips.
FEDERAL MAGISTRATES |
CAM 2079 of 2002
| T U |
Applicant
And
| V U |
First respondent
And
| W M |
Second respondent
REASONS FOR JUDGMENT
Introduction
This matter concerns child support payable by the father, T U, with respect to two children. The first of these, L, is a child of Mr U and V U. The second, B, is a child of Mr U and W M.
This matter was heard on 5 and 6 March 2002. The father appeared in person. Mr Brown, solicitor, appeared for V U and W M, who lives in Queensland, appeared in person by telephone. At the conclusion of that hearing, the father sought to argue that s.117A of the Child Support (Assessment) Act applied in this case. I ruled that there was insufficient evidence to bring that section into play but gave the father leave to file further material within 21 days. He did file such material and further submissions were heard on 29 May 2002.
Background
On 18 December 2001, the Child Support Agency made rulings in relation to competing Departure Applications between the father and V U on the one hand, and between the father and W M on the other. The result of this determination was that the father's liability to pay child support was fixed on the income of $61,000 per annum and further, in relation to L, he was ordered to pay an additional $2600 per annum for L's special needs.
The evidence is that the father's basic salary is $53,019 per annum. There was evidence before the Child Support Review Officer that he had performed higher duties and earned overtime during the financial year to December 2001. The father has given evidence that he has not performed higher duties nor worked overtime since December. The Child Support Officer added to the father's base income the extra amount he earned up to December by way of higher duty allowance and overtime and assessed his income for the year ended 30 June 2002 at $61,000. It appears that it was accepted that no further higher duty allowance or overtime would be payable from December to 30 June 2002.
The Child Support Officer also assumed that this pattern of the father's overtime and higher duty allowance would be repeated in future years and the determination fixing the child support income amount at $61,000 per annum was extended to cover the period up to 17 December 2003.
Discussion
It is convenient at this stage to dispose of the s.117A point.
Mr U has re-partnered. His partner has a child. He regards himself as having an obligation to assist in the support of that child.
The purpose of s.117A in the context of this case is to allow a parent who wishes to support a child of his partner to earn additional income for this purpose without a part of that income being appropriated to the support of another child. An example would be where a liable parent assumed responsibility for a child of his partner and to assist with that child’s support commences a second job or undertakes overtime. It was obviously perceived as unfair that a part of any income so derived might be taken from the parent and applied to the support of another child.
To bring oneself within the provisions of the section it is necessary to demonstrate that the working of a second job or overtime was not part of a pattern before the second family came on the scene. In my opinion Mr U has failed to demonstrate this. The evidence is that he was working overtime and performing higher duties from time to time before he began the relationship with his present partner.
I am not disposed to change the child support payable for the year ended 30 June 2002. If the father does not work further overtime and does not have higher duties for the rest of this financial year, he will still earn $61,000 and there is no reason why he should not be assessed on this figure.
The Child Support Review Officer appears to have proceeded on the assumption that the father would continue to work overtime or perform higher duties on a level comparable with the year 2001/02. In my opinion, the evidence is insufficient to warrant an order that child support continue to be payable on the basis that the father will continue to earn income in the order of $61,000 per annum. It is quite possible that he will earn this amount or even more. It is equally possible that he will not be offered overtime or higher duties in the future. I propose to make an order that child support for the period after 30 June 2002 be payable on the basis of the father earning $53,019 per annum and I will require him to send payslips to the two respondents once every three months. Those payslips will reveal the amount paid in the financial year to date and will disclose if any additional income is being earned. In my opinion child support should be payable on his actual income not on his base salary.
The question then arises as to the additional amounts ordered to be paid with respect to L. L suffers severe disabilities and his mother has compiled a list of payments she has to make over and above ordinary child raising expenses which are referable to these disabilities. They amount to more than $8,000 per annum and in general, they seem to me to be reasonable. I am satisfied that Ms U has established a ground for departure under s.117(2)(b)(i)B. The question then arises as to whether it is just and equitable to make a Departure Order having regard to the matters set out in s.117(4).
Section 117(4)(e) requires me to have regard to the commitments of the father which are necessary to support himself. This is also reflected in s.3(2) of the Act which is in identical terms to s.66C of the Family Law Act.
The father's duty to support his child has priority over all commitments other than commitments necessary to enable him to support himself or any other child or other person that he has a duty to maintain.
There is no other person that the father has a legal duty to maintain.
I did not interpret the word "necessary" to mean absolutely unavoidable. In my opinion, necessary expenses mean those which are required to provide a reasonable (albeit in this case a necessarily austere) standard of living for the father. If, after deducting from his income those expenses which I consider necessary in this sense there is a surplus, then I will make an order that that surplus be applied to the support of L.
The father has set out a list of his expenses. It has been noted that those expenses cover both himself, his present partner, who he has no duty to maintain, and her child, who he also has no duty to maintain. These expenses are as follows and are expressed on a fortnightly basis:
Groceries
$300
Health insurance
$54
Other insurance
$153
Home loan repayments
$550
Other loan
$400
Rates/gas/water etc
$70
Compulsory superannuation
$41
Private vehicle expense
$168
Clothing/shoes/hairdressing
$50
Education
$20
Fares
$30
Child support
$115
Counselling sessions
$100
Medical prescriptions
$20
Visits to mother
$35
Support of partner
$250
Support of step children
$200
Commonwealth Bank and St George credit card
$150
My comments on these expenses are as follows:
(a)As previously pointed out, they include expenses for people the father has no legal duty to maintain.
(b)They include a mortgage on his partner's home. The home is apparently owned by the father's partner but he is a co-mortgagor. This, however, makes no difference in my opinion. There is no rule to the effect that a parent's wish to own, as opposed to rent, accommodation means that mortgage payments are necessary expenditure and should take priority over that parent's responsibility to support his or her child. In my opinion, a parent is entitled to have reasonable accommodation costs taken into account when assessing his or her capacity. The Child Support Review Officer allowed $200 a week as reasonable accommodation expenses and I regard this as an appropriate figure.
(c)The figure for insurance is very high. Twenty-eight dollars a week relates to insurance for a motor cycle. This is high because the motorcycle was apparently damaged in an accident. The other insurances apparently relate to the home owned by the father's partner and contents, which in main, are the property of his partner. I will allow the $28 motorcycle insurance together with a reasonable amount for contents insurance.
(d)The loan relates to the father's motorcycle and it transpired in evidence that the correct figure is $91 a week, not $200 a week.
(e)The item for rates and water relate to the fact that the home the father occupies is owned rather than rented. The figure of $200 a week for accommodation expenses includes this figure. The figure in relation to electricity and telephone appears reasonable.
(f)The education expenses relate to textbooks purchased by the father. He works in the information technology area and says that he needs to keep up to date. The figure appears reasonable but what is not taken into account is that that this expenditure will be a tax deduction. I propose to adjust it accordingly.
(g)The item for fares would only be relevant when the father's motorcycle is off the road being repaired or serviced. This should be a minimal amount and in the circumstances I propose to disregard it.
(h)The evidence in relation to the motorcycle expenses are that registration is $380 a year, that the motorcycle requires about two services a year each costing $320 and it requires reasonably frequent replacement of tyres which cost $300 each. In addition, there are some petrol expenses. I will have regard to this in allowing a figure I regard as reasonable in all the circumstances.
(i)I calculate the correct figures for the child support would be $258 per week if child support was assessed on the income of $61,000 and $216 a week if assessed on the figure of $53,019.
(j)The counselling sessions are said to relate to depression suffered by the father. He annexed a letter to his affidavit from a Dr Eleanor Chew, which reads as follows:
“Mr T U has been a patient of this practice since June 2000. He is currently suffering from depression partly contributed by the problems relating to access to his son L and his current financial situation. He is under medication for his depression and has been unable to afford to seek counselling due to financial constraints.”
There is no evidence that attendance at counselling is essential as opposed to desirable and if it is, how frequently counselling should be undergone. In the circumstances, I do not propose to allow this figure.
(k)The visits to the father's mother relates to visiting her in Melbourne. She is apparently ill. I sympathise with the father's position in this respect but do not regard these expenses as being necessary to support himself.
(l)In so far as the figure for support of his partner and stepchild is concerned, I simply repeat my earlier comment that he has no legal responsibility to support these people.
(m)In so far as credit cards are concerned this is in fact double counting as the payments are including in the mortgage. However, in circumstances where I have disregarded the mortgage payments, I should take account of the father's credit cards. Credit cards are a fact of life in modern society. However, it is inappropriate to allow anything other than interest on credit cards as otherwise there would be an element of double counting.
On the basis of the foregoing, I assess the father's reasonable living expenses as follows, expressed on a weekly basis. I acknowledge that much of this assessment is arbitrary.
Compulsory superannuation
$20
Food and household supplies
$80
Health insurance (single rate)
$13
Motorcycle insurance
$28
Contents insurance
$5
Accommodation expenses
$200
Motorcycle expenses (registration $380 per annum, services $640 per annum, tyres $500 per annum, petrol and running $750 per annum, total $2270 per annum)
$44
Motorcycle loan
$91
Clothing
$20
Phone and electricity
$30
Self education
$14
Medication
$20
Credit card interest
$5
Total:
$570
On an income of $61,000 per annum, the father would have to pay tax and Medicare levy of $16,965 leaving a net income of $45,035. This equates to $866 per week. After deducting child support which would come to $258 per week for two children, he would have $608 remaining. If $570 is deducted, then there is surplus of $38 per week and I find the father has the capacity to pay this amount.
On an income of $53,019 per annum, I calculate the tax and Medicare levy payable at $12,175. This leaves a net figure of $40,844 or $785 per week. Child support would amount to $216 leaving a disposable income of $561 per week. On this basis, he will have no capacity to pay any additional money.
Conclusion
I propose to leave the Child Support Review Officer's assessment in place until 30 June 2002 except I propose to reduce the additional amount payable for L to $38 a week. Thereafter, child support is to be assessed on an income of $53,019 per annum with no additional payments. As previously indicated, I will make an order that the father provide payslips on a quarterly basis.
If the matter were to come before me again then, subject to any additional evidence being called which might change the position, I would assess child support on the basis of the actual income earned by the father, including overtime and higher duties. If the net income after payment of child support, tax and Medicare levy exceeded $570 a week, I would order the surplus to be paid to L's mother, certainly up to the figure of $50 a week as ordered by the Child Support Review Officer. If the surplus was significantly more than $50 a week, I might want to look more closely at the expenses for L, although in general I would think an amount at around $8,000 per annum is not unreasonable. I regret that my decision does not, unless the husband does earn additional income, permit me to order payment of additional monies for L's purposes. I have great sympathy with the position his mother finds herself in.
I trust the matter will not come before me again and that, given my views, the parties would be able to resolve the matter. If the matter were to come before me again, and if I were to find that the father's position unreasonable, I would not hesitate to order that he pay the costs of any represented party.
I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of Brewster FM
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