Watkins and Northmore (Child support)

[2024] AATA 385

Watkins and Northmore (Child support) [2024] AATA 385 (29 January 2024)

DIVISION:Social Services & Child Support Division

REVIEW NUMBERS:  2023/BC026488, 2023/BC026506, 2023/BC026507, 2023/BC026508, 2023/BC026509 and 2023/BC026510

APPLICANT:  Mrs Watkins

OTHER PARTIES:  Child Support Registrar

Mr Northmore

TRIBUNAL:Senior Member S Trotter

DECISION DATE:  29 January 2024

DECISIONS:

2023/BC026488

The decision under review to accept and credit a payment of $1,387 for school fees paid by Mr Northmore on 11 February 2021 is affirmed.

2023/BC026506

The decision under review to accept and credit a payment of $4,387 for school fees paid by Mr Northmore on 11 February 2021 is set aside and a decision substituted that an amount of $4,387 is not to be credited against Mr Northmore’s enforceable child support liability.

2023/BC026507

The decision under review to accept and credit a payment of $4,192.50 for school fees paid by Mr Northmore on 2 December 2020 is affirmed.

2023/BC026508

The decision under review to accept and credit a payment of $373 for school fees paid by Mr Northmore on 6 May 2021 is affirmed.

2023/BC026509

The decision under review to accept and credit a second payment of $1,387 for school fees paid by Mr Northmore on 11 February 2021 is set aside and a decision substituted that a second amount of $1,387 is not to be credited against Mr Northmore’s enforceable child support liability.

2023/BC026510

The decision under review to accept and credit a payment of $381 for school fees paid by Mr Northmore on 3 March 2021 is affirmed.

CATCHWORDS

CHILD SUPPORT – non-agency payments – liable parent’s payment of school fees – multiple decisions under review affirmed or set aside and substituted

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

REASONS FOR DECISION

BACKGROUND

1. This review is about whether certain payments of school fees for [Child 1] and [Child 2], the daughters of Mrs Watkins and Mr Northmore, should be credited as non-agency payments in the child support case between Mrs Watkins and Mr Northmore.

2. The Tribunal had before it documents provided by Child Support, copies of which had been provided to Mrs Watkins and Mr Northmore. The documents were marked as Exhibit 1 (pages 1 to 281) in the proceedings.

3. On 12 and 13 January 2022, Mr Northmore requested that Services Australia – Child Support (Child Support) credit various payments he had made for school fees for [Child 1] and [Child 2] as non-agency payments against his child support liability. Records of the online requests by Mr Northmore appear at pages 45 to 50 in relation to amounts of $4,387, $4,192.50, $1,387, $1,387, $381 and $373 respectively.

4. On 13 January 2022, Child Support decided to credit the following payments as non-agency payments made by Mr Northmore, thus reducing his child support liability by the following amounts:

Date of payment sought to be credited	Amount of payment sought to be credited	Page reference in Exhibit 1 for letters notifying of original decision of Child Support to credit amount as non-agency payment	Page reference in Exhibit 1 showing amount credit in the child support case
11 February 2021	$4,387.00	Pages 65 to 68	Page 271
2 December 2020	$4,192.50	Pages 69 to 72	Page 271
11 February 2021	$1,387.00	Pages 73 to 76	Page 271
11 February 2021	$1,387.00	Pages 77 to 80	Page 271
3 March 2021	$381.00	Pages 81 to 84	Page 271
6 May 2021	$373.00	Pages 85 to 88	Page 271

1. On 17 November 2022, Mrs Watkins objected to these decisions. Child Support granted an extension of time within which Mrs Watkins could object to the decisions (with an objection usually required to be lodged within 28 days of receiving notice of decisions). On 11 July 2023, a Child Support objections officer disallowed the objections in six objection decisions.

2. By application to this Tribunal on 27 July 2023, Mrs Watkins requested a review of Child Support’s objection decisions. On 9 May 2023, the Tribunal (differently constituted) granted an extension of time within which Mrs Watkins could apply to the Tribunal (with applications to the Tribunal usually required to be lodged with 28 days of receiving notice of the objections decisions).

3. Hearings took place on 12 December 2023 and 25 January 2024. The Tribunal spoke with Mrs Watkins and Mr Northmore by conference telephone. Both gave evidence on affirmation. Noting that Mr Northmore did not object, the Tribunal granted leave for Mrs Watkins’ husband [Mr A] to be present at the hearing to provide support to Mrs Watkins.

ISSUES

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

CONSIDERATION

1. Mrs Watkins told the Tribunal that she is seeking that only half of the amounts paid by Mr Northmore as school fees in 2021 be credited as non-agency payments, reducing Mr Northmore’s child support liability. This is what has happened in relation to subsequent payments in 2022 and Mrs Watkins is seeking the same decisions in relation to the 2021 payments. This recognises that they are paying the school fees 50/50 and, therefore, only half of the school fees paid by Mr Northmore in 2021 should be credited.

2. Mrs Watkins’ evidence was that there was an agreement between her and Mr Northmore that Mr Northmore would pay the school fees for their daughters in addition to child support and that she would pay for uniforms, camps, books, laptops and everything else that was needed for school. Mr Northmore’s evidence was that he did agree that he would pay the school fees. He said that there was never any discussion about child support at that stage. He assumed that it was part of the child support he would pay. He was at home at the time and was not working.

3. Mrs Watkins in response stated that Mr Northmore was paying the minimum annual rate of child support and it was therefore clear that payment of school fees was in addition to child support. Mrs Watkins said that when they did their final divorce papers, Mr Northmore’s lawyer included in the papers that Mr Northmore would be paying child support plus school fees. Mrs Watkins referred the Tribunal to page 136 of Exhibit 1, part of the Application for Divorce by Mr Northmore dated 9 November 2020, where it is stated ‘The child is supported by both the Mother and the Father. The Father pays child support via the Child Support Agency and pays school fees’. The Tribunal notes that although set out in the divorce application, no reference was made in the final court order dated 11 February 2020 (pages 139 to 144).

4. Mrs Watkins said that she initially didn’t want any of the school fees credited against Mr Northmore’s child support liability however she now considers that it would be reasonable to credit that part of the school fees that would be attributable to what she now considers is her 50% share that Mr Northmore paid.

5. Mr Northmore indicated that he would abide by any decision that was made but that he had assumed his payment of school fees would be taken into account for child support purposes. Further, Mr Northmore stated that all his child support credit has been used, or almost used, to this point and if not all of the amounts that have been credited to date are allowed, he will be liable for an amount that he had not budgeted for.

6. The Tribunal discussed with Mrs Watkins and Mr Northmore at the first hearing that the bank statements and the Statements of Account from [College 1] in evidence suggest that only one payment of $1,387 was made by Mr Northmore on 11 February 2021 and that Child Support seems to have credited that payment twice. At the first hearing, both Mrs Watkins and Mr Northmore agreed that that was the case.

7. Between the first hearing and the second hearing, the Tribunal gave Mr Northmore an opportunity to provide a further bank account statement or statement from the relevant school evidencing the 11 February 2021 $4,387 payment sought to be credited. Mr Northmore confirmed that his bank account statement only showed one payment, a payment of $1,387 on 11 February 2021. To ensure that Mrs Watkins and Mr Northmore both understood the evidence before the Tribunal, that is that the statements only supported payments as claimed of $1,387, $4,192.50, $381 and $373 having been made by Mr Northmore on the relevant dates in relation to school fees, the Tribunal convened the second hearing. Mr Northmore acknowledged and agreed that those were the only payments made of the claims processed by Child Support in relation to the decisions the subject of this application. Mr Northmore agreed that the $4,387 was not a payment he had made. He said that he cannot recall that he actually even claimed that amount and observed that it seems ‘odd’ that it was made on the same day as the $1,387 payment. He noted that the last 3 digits of the $4,387 were the same as the $1,387 payment and wondered whether Child Support somehow got the amounts mixed up. Mr Northmore further agreed that his statements only show one payment of $1,387 not two. Mr Northmore agreed that the evidence supported payments made by him of $1,387, $4,192.50, $381 and $373 but not an extra $1,387 nor a payment of $4,387.

8. Based upon the evidence, the Tribunal is satisfied that the following payments were made by Mr Northmore for school fees of the children:

Date of payment sought to be credited	Amount of payment sought to be credited
2 December 2020	$4,192.50
11 February 2021	$1,387.00
3 March 2021	$381.00
6 May 2021	$373.00

1. School fee payments may be credited as non-agency payments under either of two provisions in the Act: sections 71A and 71C. These sections provide for ordinary non-agency payments and prescribed non-agency payments respectively.

2. Section 71A of the Act concerns payments made to a third party where those payments were intended by both parties to be payments in satisfaction of the child support liability. Where certain requirements are met, the Registrar must credit the non-agency payment against the payer’s child support liability. Mr Northmore’s evidence was that school fee payments made by him were to be considered child support. Mrs Watkins’ evidence was that that was not the intention. Mr Northmore’s divorce application included reference to that being the position however that was not ultimately encapsulated in court orders. In the circumstances the Tribunal is unable to be satisfied that both Mrs Watkins and Mr Northmore intended that school fees payments by Mr Northmore were intended to be in satisfaction of or towards Mr Northmore’s child support liability. Section 71A therefore has no application.

3. Section 71C of the Act enables certain prescribed non-agency payments to be credited against a payer’s child support liability regardless of the intention of the payer and payee at the time the payment was made. Credit can be allowed up to a maximum of 30% of the child support liability if the balance of the liability is paid as it becomes due and payable. The section may only be applied if the payer does not have at least regular care of the children. Child Support’s records show and the Tribunal is satisfied that at all relevant times Mr Northmore had below regular care.

4. Regulation 5D of the Child Support (Registration and Collection) Regulations 1988 specifies the types of payments for the purposes of section 71C and includes “fees charged by a school or preschool for that child”.

5. The Tribunal is satisfied that Mr Northmore has paid school fees as set out in paragraph 16. Therefore, subject to section 71D, the Tribunal therefore finds that the payments can be credited under section 71C of the Act.

6. Section 71D of the Act provides that consideration be given to whether there are circumstances to suggest that the payment should not be credited even if the requirements of section 71C are otherwise met. There is no evidence before the Tribunal such that the Tribunal considers it inappropriate to credit the four payments. The Tribunal recognises that Mr Northmore’s child support position will inevitably change with his credit reduced. However as acknowledged by Mr Northmore at hearing that is appropriate given the evidence of what was actually paid by him.

7. The Tribunal will therefore affirm the decisions to credit payments of $1,387, $4,192.50, $381 and $373 and set aside the decisions to credit the second payment of $1,387 and the $4,387 payment.

8. The Tribunal acknowledges the concerns of both Mrs Watkins and Mr Northmore as to how Child Support made the original decisions to credit the second $1,387 payment and the $4,387 payment in the absence of evidence that those payments had been made. The Tribunal shares the parents’ concerns. However, as discussed the Tribunal on review is conducting a merits review based upon the evidence. It is not the role of the Tribunal to review the processes of the Child Support.

DECISIONS

2023/BC026488

The decision under review to accept and credit a payment of $1,387 for school fees paid by Mr Northmore on 11 February 2021 is affirmed.

2023/BC026506

The decision under review to accept and credit a payment of $4,387 for school fees paid by Mr Northmore on 11 February 2021 is set aside and a decision substituted that an amount of $4,387 is not to be credited against Mr Northmore’s enforceable child support liability.

2023/BC026507

The decision under review to accept and credit a payment of $4,192.50 for school fees paid by Mr Northmore on 2 December 2020 is affirmed.

2023/BC026508

The decision under review to accept and credit a payment of $373 for school fees paid by Mr Northmore on 6 May 2021 is affirmed.

2023/BC026509

The decision under review to accept and credit a second payment of $1,387 for school fees paid by Mr Northmore on 11 February 2021 is set aside and a decision substituted that a second amount of $1,387 is not to be credited against Mr Northmore’s enforceable child support liability.

2023/BC026510

The decision under review to accept and credit a payment of $381 for school fees paid by Mr Northmore on 3 March 2021 is affirmed.