Wynn and Wynn (Child support)

[2019] AATA 5107

Wynn and Wynn (Child support) [2019] AATA 5107 (2 September 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/PC016500

APPLICANT:  Ms Wynn

OTHER PARTIES:  Child Support Registrar

Mr Wynn

TRIBUNAL:Member M Martellotta

DECISION DATE:  02 September 2019

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – non-agency payment - prescribed payment for utilities – no special circumstances to refuse - payments correctly credited - decision under review affirmed

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 a decision made by the Department of Human Services – Child Support (the Department) to credit certain third party payments as prescribed non-agency payments (PNAP). 

2. The Department made a decision on 3 December 2018 to credit a utility payment of $28.90 as a non-agency payment and to credit third party payments totalling $4,287.34.  Ms Wynn objected to the decision.  On objection the Department decided to credit all of the payments as PNAP.

3. Ms Wynn lodged an application with the tribunal seeking independent review of the Department’s decision. On 2 September 2019 the tribunal convened a hearing. Ms Wynn and Mr Wynn each attended by telephone conference and gave evidence under affirmation.

4. The Department provided documents relevant to their decision to the tribunal and the parties (388 pages). Ms Wynn also provided documents (A1-A51).

ISSUES

1. The statutory provisions relevant to this review are contained in the Child Support (Assessment) Act 1989 (the Act) and the Child Support (Registration and Collection) Act1988 (the CSRC Act).

2. Child support legislation is interpreted by the Department with the aid of the Child Support Guide (the Guide). The tribunal is not bound by law to apply the policy as set out in the Guide but, provided the policy is consistent with the legislation, it is required to have regard to it and in the ordinary course follow it.[1]

   [1] See Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634.

3. The issue which arises in this case is whether payments made by Mr Wynn to third parties are to be credited as PNAP against his child support liability.

CONSIDERATION

1. At hearing Ms Wynn was not disputing evidence demonstrating that Mr Wynn had made certain payments to third parties; however she told the tribunal that she disagrees with the Department’s decision mainly because she never agreed or asked Mr Wynn to make the payments he has made on her behalf. 

2. Payments made by a payer to a third party may be credited against the payer’s child support liability if the intention of both parties was that the payments, or part of the payments, be credited against the payer’s child support liability in relation to the child support enforcement period (section 71A of the CSRC Act).  The CSA refers to these types of payments as “non-agency payments”.

10.Section 71C of the CSRC Act, and Regulation 5D of the Child Support (Registration and Collection) Regulations1988 (the Regulations), allows the CSA to credit certain payments towards a payer’s child support liability regardless of the intention of the parents at the time the payment was made (that is, regardless of whether or not the payments were intended to be in lieu of child support), except if, at the time the payment was made, the payer had at least regular care of any of the children to whom the relevant administrative assessment relates to.  Credit can be given up to a maximum of 30% of the ongoing liability provided that:

·     the balance of child support is paid as it becomes due and payable;

·     the payer has less than 14% care of all of the children to whom the relevant administrative assessment relates at the time the credit is being applied (paragraph 71C(1)(d)); and

·     the child support liability is not already being met by a lump sum credit

1. Section 5.3.1 of the Guide[2] provides the following policy guidance:

   Prescribed payments can only be made in relation to a home in which the payee lives and for which the payee is jointly or solely responsible.

   Prescribed payments can only be made for repayments on a loan that financed the payee's home where the payee is named on the mortgage documents and is liable for repayments on the loan.

   Where the payer makes payments for the payee’s home, for which they and the payee are jointly responsible, the Registrar will credit only the payee's share. In the absence of evidence to the contrary, this will be half the total amount.

2. Such payments must be of the types specified under the Regulations (paragraph 71C(1)(b) of the CSRC Act). Regulation 5D of the Regulations lists the types of payments and includes fees for essential medical services for the child and the payee’s share of amounts payable for their home (this includes their share of amounts payable for utilities, rates or body corporate charges and their share of repayments on a loan that financed the home).

13.The Child Support Registrar (and on review the tribunal) may refuse to credit amounts under section 71C of the CSRC Act if satisfied that, in the circumstances of the particular case, the amount ought not to be credited (section 71D of the CSRC Act).

[2] In Drake and Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60 the full Federal Court held that a tribunal should take into account relevant government policy which is not inconsistent with the provisions or objects of the legislation.

1. In this matter it is not in dispute and the tribunal finds that:

   a)Ms Wynn resides in a property that is jointly owned by her and Mr Wynn (the [Suburb 1] property).

   b)Mr Wynn’s care percentage as recorded in the assessment is 0%

   c)That property is subject to a mortgage for which the parties are jointly liable.

   d)Mr Wynn made the following third party payments which included Ms Wynn’s share of the following liabilities:

   ·property rates $384.64 (3 September 2018)

   ·[Utility bill] payments of $178.29, and two payments of $57.80 (17 and 20 September 2018 3 November 2018)

   ·Three mortgage repayments of $2,513 (20 September, 20 October and 20 November 2018)

   ·Telstra phone line rental to property of $100 (20 September 2018).

   ·Medical costs for the child of $315 (for an eye procedure).

2. In relation to the above payments the Department decided to credit as NAPS the following amounts being Ms Wynn’s share of the above liabilities:

   ·Rates of $192.32

   ·[Utility bill] payments of 2 x $28.90 and one payment of $89.12

   ·Mortgage repayments of $1,256.60 x 3

   ·Telstra payment of $50

   ·Medical costs of $157.50

3. Ms Wynn told the tribunal that she has never been responsible for the mortgage on the property which she previously ran as an Airbnb for many years; her role was to do that and to care for the children.  Some of the payments made were for periods prior to her moving into the property.  She has also made payments for bills and costs and it is not fair that this is not taken into account.

4. Whilst there was some dispute between the parties as to whether Ms Wynn started living in the property in early or late July 2018, the tribunal is satisfied that the payments made by Mr Wynn meet the definition of being payments for Ms Wynn’s share of amounts payable for their home and also payment of her share of essential medical expenses for the child.[3]

   [3] There is an email on the Department documents which shows Ms Wynn requesting Mr Wynn to cover the medical costs of their son’s medical needs as it is not covered by Medibank.

5. In this matter on the evidence provided at hearing and as provided by the Department records, the tribunal is satisfied that the payments made by Mr Wynn are payments as specified by the Regulations and that the requirements of section 71C of the CSRC Act have been met.

6. The tribunal next considered whether there was any reason that the amounts should not be credited pursuant to section 71D of the CSRC Act. According to the Guide at section 5.3.1 such reasons can include circumstances where:

   ·     The payee's agreement to credit an amount paid to a third party or payment made as a transfer of property was obtained through coercion or harassment.

   · The payer is claiming a credit under section 71C for an expense they regularly meet that was taken into account in a change of assessment decision.

   · The payer is claiming credit under section 71C for an expense, which they have undertaken to pay in addition to their liability as specified in an agreement between the parents.

   · The payer is claiming credit under section 71C for an expense that they are responsible to pay under the terms of a court order.

   · The payer is claiming credit under section 71C for expenses for the child for which they are separately responsible.

   · The payer is claiming a credit under section 71C for loan repayments and they have a history of regularly withdrawing funds from the loan account using its redraw facility.

7. In this regard Ms Wynn stated that as from 6 August 2019 there are Family Court orders which now require Mr Wynn to cover the mortgage costs of their properties. It appears to the tribunal that the relevant orders were not in place at the time these particular payments were paid, and that this is not a case in which subsequent orders provide a basis to not credit payments made prior to those orders. The tribunal was otherwise satisfied that this was not a matter in which the discretion was to be exercised.

DECISION

The decision under review is affirmed.