W and F
[2003] FMCAfam 173
•22 May 2003
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| W & F | [2003] FMCAfam 173 |
| FAMILY LAW – CHILD SUPPORT – Application for departure from assessment – “special circumstances” – “just and equitable” – “otherwise proper” – child’s special needs – father’s necessary commitments. Federal Magistrates Act 1999 (Cth) s. 42 Gyselman and Gyselman (1992) FLC 92-279 |
| Applicant: | F C W |
| Respondent: | C J F |
| File No: | ADM 2721 of 2001 |
| Delivered on: | 22 May 2003 |
| Delivered at: | Launceston |
| Hearing date: | 15 & 16 May 2003 |
| Judgment of: | Roberts FM |
REPRESENTATION
| The Applicant appeared on his own behalf |
| The Respondent appeared on her own behalf |
ORDERS
That for the period 1st April 2002 to 31st May 2007 there be a departure from administrative assessment of Child Support payable by F C W (“the liable parent”) for the children L C W born 31st January 1993 and A C W born 4th October 1995 in that the annual rate of Child Support to be paid by the liable parent is to be $17,182.
That commencing on 1st July 2004 the Child Support hereby ordered is to be varied annually in accordance with the variation in the Consumer Price Index published by the Commonwealth Statistician for all groups for Adelaide (“the CPI”) by comparison with the CPI twelve months prior thereto.
That a copy of these Orders be provided to the Adelaide office of the Child Support Registrar.
That the Amended Form 63 Application filed by the liable parent on 7th May 2003 be otherwise dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADM 2721 of 2001
| F C W |
Applicant
And
| C J F |
Respondent
REASONS FOR JUDGMENT
Background
The Applicant, F C W (“the Father”) and the Respondent, C J F (“the Mother”) were married on 27th January 1985. They have two children, L C W born 31st January 1993 (“L”) and A C W born 4th October 1995 (“A”).
The parties separated on 3rd December 1998 and the children have resided with the Mother since separation. The parties lived together in Mount Gambier in South Australia from before the birth of the first child until their separation.
The parties signed a Child Support Agreement dated 8th March 2001 (“the Child Support Agreement”) which states in the Recitals that the child L “suffers from autism and has special needs”.
The Child Support Agreement contains the following clauses:
3.Subject to the following conditions, the husband’s obligation to pay Child Support for the children shall be in the amount as assessed by the Child Support Agency from time to time.
4.The husband shall have overnight contact with the children for not less than 110 days in each calendar year (“the minimum contact”). The husband wishes to record that according to his estimate, he currently has contact with the children for approximately 130 days to each calendar year.
5.If the husband has less than the minimum contact in any calendar year, he shall pay for or reimburse (as the case may be) the cost incurred by the wife in Family Day Care for (L) for the number of days by which the husband’s contact with the children is less than 110.
6.The agreed contact arrangements between the husband and the wife provide for the husband to care for (L) for a period of four hours each Thursday night during school terms. If for any reason the husband is unable to provide this care, he will pay or reimburse (as the case may be) the reasonable costs for child minding of (L) during that four hour period.
7.The parties acknowledge that all costs which are attributable to (L’s) special needs are to be met, in the first instance, by the disability allowance (or the equivalent benefit from time to time) received by the wife from Centrelink. To the extent that there is any shortfall between the quantum of the costs of (L’s) special needs and the disability allowance, the parties agree that the shortfall shall be met by the husband and the wife equally.
8.From the date of this agreement until the making of consent orders under Section 79 of the Family Law Act between the husband and the wife, the husband shall pay the wife an additional sum of $50 per fortnight by way of Child Support.
9.The wife shall sign all documents and give all instructions necessary to Centrelink to ensure that the Family Allowance payment in respect of the children is paid by Centrelink in the following proportions:
(a)70 per centum thereof to the wife;
(b)30 per centum thereof to the husband.
10.If either the husband or the wife move his or her permanent place of residence more than 50 kilometres from Post Office at Mount Gambier, then the party making the move shall do all travelling for the purposes of contact.
In December 2001 the Father moved to Adelaide and the Mother and the children continued to reside in Mount Gambier. Essentially, it is the Father’s move to Adelaide, and what has flowed from that move, that has caused the dispute between the parties about child support.
Annual rates of Child Support payable by the Father were administratively assessed by the Child Support Agency as follows:
·$9,247 for that period 1 December 2000 to 23 January 2002;
·$11,348 for the period 24 January 2002 to 28 February 2002; and
·$11,540 for the period 1 March 2002 to 31 May 2003.
On 23rd January 2002 the Father applied to the Child Support Agency for a departure from his Child Support Assessment based upon his claim that it cost him more than 5% of his Child Support Income to have contact. At that time, he claimed costs of $5,402 in relation to such contact.
On 21st February 2002 the Mother responded to the Father’s Application. She disputed the costs of contact and sought an increase based upon the special needs of L and the costs to her of meeting those needs.
On 19th April 2002 Senior Case Officer L P (“the Senior Case Officer”) delivered a decision in the matter and found that:
a)it did cost the Father more than 5% of his Child Support Income to enjoy contact;
b)costs to maintain the children were significantly affected because of L’s special needs;
c)costs of maintaining L were significantly affected because of his being cared for, educated or trained in a manner expected by the parties; and
d)the costs of maintaining L were significantly increased because child care costs were more than 5% of the Mother’s Child Support Income.
The Senior Case Officer found that the high cost of the Father’s contact would ordinarily have resulted in a reduction in the annual rate of child support by about $1,080. However, the increased costs to the Mother because of L’s special needs came to a total of $7,052. Setting one off against the other the Senior Case Officer concluded that the Mother had an additional need for $5,972 per annum.
The Senior Case Officer concluded that the annual rate of child support of $11,210 (if assessed pursuant to the formula) should be increased by $5,972 “on account of the net special circumstances pertaining to this case” and fixed the annual rate at $17,182 for the period from 1st April 2002 to 31st May 2003 (i.e. approximately $330 per week).
Both parties lodged objections to the decision by the Senior Case Officer. However, the Child Support Agency disallowed both objections on 12th June 2002.
Applications
On 25th June 2002 the Father filed a Form 63 Application seeking a reduction in child support and a stay of the amount to be paid other than $425 per fortnight. That Application came before Federal Magistrate Brown on 19th July 2002. A stay was granted on the basis that the Father pay child support at the rate of $221 per week.
On 7th May 2003 the Father filed an Amended Application which sought the following:
a)An order for a stay of child support (which was unnecessary because Federal Magistrate Brown had already granted a stay);
b)An order that the Child Support Agreement be discharged;
c)An order that the Father pay “in accordance with the normal Child Support Assessment, but in addition pay up to $2,080 per year ($40 per week) towards respite, with the Wife to forward to the Husband, receipts to be paid by the Applicant, relating to respite costs”; and
d)An order that “the relevant financial situations of both parties, and the amount of any additional payments to be made by the Applicant towards respite, be reviewed every 4-5 years, so that any fair and reasonable adjustments may be made”.
Although the Court file did not reveal that the Mother had filed a Response to the Father’s substantive application, it has been clear throughout the proceedings so far that she is opposed to that application. I therefore relied upon the provisions of Section 42 of the Federal Magistrates Act 1999 to allow the matter to proceed without the necessity for her to file a written Response. It was clear that she was seeking orders that continue the payment of Child Support at the annual rate at $17,182 for the period from 1st April 2002 to 31st May 2003.
It seems to me that both parties are seeking to depart from the last administrative assessment at the annual rate of $11,540. Both parties are seeking to increase that amount, albeit that the Mother is seeking a higher increase than the Father.
Further, both parties want the Court to continue any order beyond the period ending on 30th May 2003. They want the Court’s decision to last for “four to five years”.
The Law
Section 117 of the Child Support (Assessment) Act 1989 (“the Act”) sets out a three stage process for determining departures from Child Support assessments. Subsection (1) requires the Court to be satisfied that in “the special circumstances of the case” one or more of the grounds for departure outlined in subsection (2) exist before the Court can make an order for departure, and that under s117(1) (b) (ii) it would be just and equitable as regards the child, the carer entitled to the support and the liable parent and that it would be “otherwise proper” to make a particular order.
The approach that this court must adopt in relation to periodic child support is well settled – see Gyselman and Gyselman (1992) FLC 92-279. It is clear that I must apply the three-stage process that is required under Section 117 of the Act and I must be satisfied that:
·one or more of the grounds for departure in sub-section 117(2) is established;
·it is “just and equitable” within the meaning of sub-section 117(4) to make a particular order; and
·it is “otherwise proper” within the meaning of sub-section 117(5) to make a particular order.
Section 117(2) of the Act sets out the various grounds for departure. It is not necessary to outline each of the various grounds available, other than to say that in the present case the Father appears to be arguing that the Senior Case Officer’s decision to increase the annual rate to $17,182 has resulted in an unjust and inequitable determination, because his capacity to provide that financial support is reduced as a result of his commitments to maintain himself – see Section 117(2)(a)(iii)(A). The Father did not appear to be relying very heavily upon the costs of contact as a ground for departure and I shall refer to that below.
In her opposition to the Father’s arguments, the mother appeared to be confirming that the costs of maintaining the children are significantly affected because of (a) the special needs of L; (b) the high cost of child care in relation to the L; and (c) the fact that L is being cared for, educated or trained in the manner that was expected by his parents - see Section 117(2)(b).
After considering the various bases for departure and whether or not in the special circumstances of the case it is appropriate for a departure order to be made, the Court must then consider subsection 117(4) of the Act which deals with the circumstances in which it is just and equitable to make the departure order sought. That subsection reads as follows:
117(4) In determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent to make a particular order under this Division, the court must have regard to:
(a)the nature of the duty of a parent to maintain a child (as stated in section 3 ); and
(b)the proper needs of the child; and
(c)the income, earning capacity, property and financial resources of the child; and
(d)the income, earning capacity, property and financial resources of each parent who is a party to the proceeding; and
(e)the commitments of each parent who is a party to the proceeding that are necessary to enable the parent to support:
(i)himself or herself; or
(ii)any other child or another person that the person has a duty to maintain; and
(f)the direct and indirect costs incurred by the carer entitled to child support in providing care for the child; and
(g)any hardship that would be caused:
(i)to:
(A)the child; or
(B)the carer entitled to child support;
by the making of, or the refusal to make, the order; and
(ii)to:
(A)the liable parent; or
(B)any other child or another person that the liable parent has a duty to support;
by the making of, or the refusal to make, the order.
Finally, it is necessary for the Court to consider subsection 117(5) and determine whether or not it is proper to make the departure order. That subsection reads as follows:
117(5) In determining whether it would be otherwise proper to make a particular order under this Division, the court must have regard to:
(a)the nature of the duty of a parent to maintain a child (as stated in section 3 ) and, in particular, the fact that it is the parents of a child themselves who have the primary duty to maintain the child; and
(b)the effect that the making of the order would have on:
(i)any entitlement of the child, or the carer entitled to child support, to an income tested pension, allowance or benefit; or
(ii)the rate of any income tested pension, allowance or benefit payable to the child or the carer entitled to child support.
In Savery and Savery (1990) FLC 92-131 Kay J said that “special circumstances” were:
“facts peculiar to the particular case which set it apart from other cases.”
In Gyselman (supra) at page 79,065, the Full Court of the Family Court said as follows in relation to the phrase “special circumstances”:
“Whilst it is not possible to find with precision the meaning of that term, as a generality it is intended to emphasise that the facts of the case must establish something that is special or out of the ordinary. That is, the intention of the legislature is that the Court will not interfere with the administrative formula result in the ordinary run of cases.”
Findings & Conclusions
As referred to above, in the proceedings before me the Father did not appear to be strongly pressing the high costs of contact as a ground for departure. That is understandable, because he has not exercised contact anywhere near as frequently or regularly as he suggested in his application that was decided by the Senior Case Officer. Indeed, he has exercised very little contact since moving to Adelaide and the result of that has been that the Mother has been burdened with almost all the responsibility of caring for the children, which is considerably higher than normal because of L’s autism.
In this case, it is perfectly clear that L’s autism makes this a matter in which there are “special circumstances” of the type referred to in Savery (supra) and Gyselman (supra). I accept the Mother’s evidence that the child L is at times almost uncontrollable and is destructive of property. Although the Father’s evidence was that he did not experience many of these difficulties during his contact periods, I find that he was under-stating the difficulties experienced by him because it did not suit his case to admit the full extent of those difficulties.
The provisions of the Child Support Agreement make it quite clear that in March 2001 both parties acknowledge that, if the Father was to have less than 110 days contact in any calendar year, he would be liable for the costs incurred by the Mother in family day care for the number of days which his contact with the children was less than 110.
Clearly, the Husband is having significantly less than 110 days contact per year. I accept the Mother’s evidence that, although the Father promised to have two contact visits each term after he moved to Adelaide, five school terms have come and gone since that move and only one such contact visit has eventuated. He has had some school holiday contact in Adelaide in addition to that, but his contact has clearly been significantly less than that envisaged by the Child Support Agreement.
Although the Child Support Agreement does not appear to been accepted by the Child Support Registrar pursuant to Part 6 of the Act, its terms were certainly give weight by the Senior Case Officer.
I have no difficulty in coming to the conclusion that there are special circumstances and grounds under Section 117(2) to justify an increase above the “normal” level of Child Support. Both parents accept that, but they differ as to the level of the increase.
Much of the evidence in this matter centred around the decision by the Father to move from Mount Gambier to Adelaide and the subsequent decision by him and his partner to purchase a house.
The Father states that his decision to move to Adelaide was, in part, because he wanted to be closer to his ageing parents. As their only child, he has no siblings to help them “at this stage in their lives”.
He says that his decision to leave Mount Gambier was made at a time when his “position of employment was perceived to be under threat”. However, I find that any such threat was more in his mind than in reality. His position in Mount Gambier has been filled by another employee and it still exists. Indeed, the Father has taken a reduction in pay to be in Adelaide.
I find that the Father’s reason to move to Adelaide was more likely to be related to his new relationship with a woman living in Adelaide than to either his aged parents or his employment. However, his motives for the move are not as important to this decision as the financial consequences of the move.
The Mother says that the Senior Case Officer based the increase in child support of $5,972 on inaccurate information that was provided by her. That was because she believed that she could gain access to twenty hours of family day care but that turned out to be wrong. She says that her costs would have been closer to $11,000 but she appreciates that the Father could not reasonably afford to pay that much by way of additional child support. She would accept an additional sum of around $6,000 per annum but would be willing to pay the Father $150 for every contact visit that he makes to Mount Gambier because she feels that it is in the children’s best interests to see their father on a more regular basis. If the Father made his promised two visits per school term, the additional child support payable by him above the normal assessment would effectively be reduced to $4,800.
I should say at this point that I do not believe that it is practical to word an order that provides for reductions in Child Support on each occasion that the Father exercises contact in Mount Gambier. Compliance with any such order could be an administrative nightmare for the parties, and for the Child Support Agency if it is to be involved in the collection process.
The Father’s case appears to be that he cannot afford to pay $17,182 per annum by way of child support but he can pay “the normal Child Support Assessment” plus a further sum of $2,080 per annum. As the last administrative assessment of child support provided for the payment of an annual rate of $11,540, it appears that the Father is willing to pay a total of $13,620 per annum (approximately $262 per week). The difference between the parties then is that the Mother wants child support payments to be at the approximate rate of $330 per week whereas the Father only wishes to pay approximately $262 per week. Consequently, the actual difference between them is $68 per week.
The matter that occupied most of the Court’s time in relation to the Father’s ability to pay was his commitment in relation to a mortgage. That commitment has arisen since he made his application to the Child Support Agency in January 2002 and it is necessary to set out some of the relevant facts.
At the time that the Father made his application to the Child Support Agency he was living rent free with his current partner (“RM”) in her house in Adelaide (“RM’s property”). In March 2002 after the Father and RM had looked at other houses to purchase, RM made a successful bid of $440,000 at auction for the purchase of a house in another suburb (“the new home”). The Father and RM are each obligated under a mortgage loan that was required to enable them to purchase the new home, although RM was able to provide her other home as security for that loan. A total sum of $462,000 was borrowed from Westpac to meet the total purchase price and the cost associated with the purchase.
The evidence given by the Father was that RM’s property was valued at $290,000 and was subject to a mortgage liability of only $20,000 when they purchased the new home.
The new home is currently tenanted and the Father’s evidence is that he and RM pay $140 each per week over and above the rent received in order to meet the mortgage payments plus a further $35 per week each to meet other outgoings. It is his view that the total of $175 per week is less than he would pay for rental accommodation in Adelaide, so it is a reasonable commitment.
It is the Father’s evidence that in September this year, the tenants will vacate the new home and he and RM will move in. At that time he will lose the benefit of his share of the rent received ($200 per week), so his commitment will increase to $375 per week.
In short, in the space of approximately eighteen months, the Father’s fixed housing costs will have increased from zero to $375 per week.
In looking at the commitments that the Father claims are “necessary” to support himself, I take some guidance from the words of the Full Court in Gyselman (supra) at page 79,074 where they said:
“In our view, the term ''commitments of the parent necessary to enable the parent to support'' himself means commitments which are reasonably needed for that purpose. They are, in the words of the Trial Judge in this case, commitments to ''support himself at a reasonable rate''. ''Necessary'' is used in contradistinction to ''unnecessary'' and should not be given any more stringent meaning………..
The use of the word ''necessary'' is not intended to produce an unrealistically low standard of living for the non-custodian. Where families separate, it is likely that in a number of cases that there will be insufficient income to support the two households at their prior standard or at a reasonable standard. Consequently, it is a matter of the balancing of competing values, namely the obligation of the absent parent to continue to support his children with, on the other hand, the need for that parent to continue to maintain himself at a reasonable level.”
In this particular case, the Father has taken on a liability which will shortly increase by $375 per week. That is a substantial liability and it is quite clear that he and RM have chosen to “move upmarket” to live in one of the better suburbs in Adelaide. In my view, that $375 per week is significantly more that is “necessary” and it must be seen in the light of his desire to reduce child support from that set by the Senior Case Officer. As mentioned above, the difference between the parties in relation to the levels of child support that they are seeking is only $68 per week.
I am required to have regard to the proper needs of the children and in this regard, it is clear that L has some special needs. Further, both parties agree that the Mother needs some respite from looking after L and that involves a cost in child care. However, the level of necessary respite and the cost are in dispute.
Section 100 of the Act enables me to take into account Section 66J of the Family Law Act 1975 and have regard to any relevant findings of published research in relation to the maintenance of children. It is clear from various decisions of the Family Court of Australia that the preferred published research is the Lee “expenditure survey” published by the Australian Institute of Family Studies (as updated from time to time). The latest updated version of that research is based upon figures for August 2002. That shows that the total expenditure per week for children in the eight to ten year old bracket is $261.20. While I am mindful that that published research is based upon a “one-child one-income family with an income of $834.40 gross per week”, it is clear to me that the Father’s suggested child support level of $262 per week would only be approximately half of what is necessary for the reasonable support of these two children. Further, that is without any consideration of L’s special needs.
In this particular case the Mother has a gross income of only $140 per week, exclusive of Centrelink benefits and child support. On the other hand, the Father has a gross income of $1,076 from his music teaching and Navy Reserve payments. In addition, he has the ability to earn extra income from private music tuition.
In the circumstances, I come to the conclusion that it is just and equitable for the Father to be paying child support at the rate of $330 per week as sought by the Mother, rather than $262 per week as sought by the Father.
I have no doubt that the Father will feel that this will cause him financial hardship. However, it is my view that he has “bitten off more than he can chew” in relation to his financial commitments. Neither the Mother nor the children should be caused financial hardship because he appears to have made some unwise financial decisions.
I must also consider whether an order that provides for $330 per week is otherwise proper in the light of subsection 117(5) of the Act. In my view, it is otherwise proper because any increase in Child Support payments could have the effect of making the Mother less dependent upon Centrelink benefits.
In the circumstances, I will be making an order that the annual rate of child support be set at $17,182.
However, I also need to specify the period for which that annual rate shall apply. As mentioned above, the parties both want me to make orders for a period of four to five years. That is in the Father’s Application and the Mother agreed with that when I specifically raised the matter.
In my view, it is appropriate to accede to the request of both parties. However, it is also appropriate to build in automatic variations in line with cost of living adjustments because that may avoid the necessity for the parties to come to court in the future. I think the Court can take judicial notice of the fact that the Father’s income as a music teacher is likely to increase over time roughly in line with cost of living increases. Clearly, the Mother and the children should not be prejudiced by increases in the cost of living over a relatively lengthy period of time. In this regard, I am mindful of the decision of Mushin J in an unreported decision in Butorac and Pennicott Appeal No.SA91/01 (which was an appeal against a decision of mine).
I certify that the preceding fifty-five (55) paragraphs are a true copy of the reasons for judgment of Roberts FM
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