Zina and Cento (Child support)

[2022] AATA 372

Zina and Cento (Child support) [2022] AATA 372 (28 January 2022)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2021/HC021697

APPLICANT:  Mr Zina

OTHER PARTIES:  Child Support Registrar

Ms Cento

TRIBUNAL:Member S Letch

DECISION DATE:  28 January 2022

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that, for the period 4 August 2020 to 31 October 2023, Mr Zina’s adjusted taxable income is varied to $76,000.

CATCHWORDS

CHILD SUPPORT – departure determination – income, property and financial resources of the liable parent – a ground for departure established – decision to depart - decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted 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. Mr Zina and Ms Cento are the parents of [Child 1], born January 2020. Mr Zina has been assessed by the Child Support Agency (CSA) as liable to pay child support to Ms Cento. Mr Zina seeks a review of an objection decision by the CSA which allowed “in part” an objection to a “change of assessment” decision of 1 February 2021. 

2. By way of background, it is convenient to set out some extracts from the objections officer decision dated 1 June 2021:

   …

   BACKGROUND

   Mr Zina is the parent liable to pay child support to Ms Cento for [Child 1], born [January] 2020.
   Agency records confirm [Child 1] is in greater than primary care of Ms Cento.

   The assessments:

   For the period 22 June 2020 to 3 August 2020, Mr Zina is assessed to pay an annual rate of child
   support of $4,348. This assessment is based on a 2018/2019 provisional income of $51,151 for Mr
   Zina and a 2018/2019 derived income of $32,922 for Ms Cento.

   For the period 4 August 2020 to 3 March 2021, Mr Zina is assessed to pay an annual rate of child
   support of $1,467. This assessment is based on a 2018/2019 income tax declaration of $5,800 for
   Mr Zina and a 2018/2019 derived income of $32,922 for Ms Cento.

   For the period 4 March 2021 to 30 June 2021, Mr Zina is assessed to pay an annual rate of child
   support of $1,467. This assessment is based on a 2018/2019 income tax declaration of $5,800 for
   Mr Zina and a 2020/2021 estimate of $0 for Ms Cento.

   The case was registered on 22 June 2020.

   This is the first Change of Assessment determination.
   …

   DECISION UNDER REVIEW

   On 3 September 2020, Ms Cento applied for a change to the assessment on the basis of Reason 8A,
   in relation to Mr Zina`s financial resources.

   On 1 February 2021, [Decision Maker 1] found Reason 8A established and made the following change:
   From 4 August 2020 to 31 December 2022, Mr Zina`s adjusted taxable income is set at
   $88,575 per year.
   …

   Mr Zina`s assessment is currently based on his 2018/2019 income tax declaration of $5,800,
   which is derived from business income. However, a review of his bank accounts held with [Bank 1] reflects he is servicing expenditure of approximately $65,175 per annum. Although
   Mr Zina states the funds are from his family, the asset being serviced is solely in his name. There
   is no evidence before me to support a formal agreement is in place for the funds to be repaid and if
   Mr Zina were to sell the property, the proceeds would be available to him in their entirety.
   On this basis, I find Mr Zina has additional financial resources available to him in the vicinity of
   $65,175 per annum. I do not intend to gross up this figure, as there is no evidence indicating a
   taxable component would be payable by Mr Zina.
   When an ATI of $65,175 is used in the assessment for Mr Zina, the annual rate increases from
   $1,467 to $5,561. I find the difference significant and I am satisfied it renders the assessment
   unfair.

   In relation to Ms Cento:

   Ms Cento`s assessment is currently based on her 2019/2020 estimate of $0. The assessment prior is
   based on her income tax declaration (2018/2019) of $32,922 based on foreign income.

   In Ms Cento`s application, she submits that she received no Centrelink benefits and cannot work, as
   she is the primary carer. She also states that she does not incur the usual costs of accommodation,
   as she lives in a refuge. Although Mr Zina alludes to the fact that Ms Cento held qualifications in
   her home country, this Reason looks at the financial resources currently available to a parent. There
   is no evidence before me to support Ms Cento is in receipt of an income. Agency records also
   confirm Ms Cento is not in receipt of a government payment.
   Reason 8A is established in relation to Mr Zina only.

   IS IT JUST AND EQUITABLE TO CHANGE THE ASSESSMENT?

   In deciding whether or not to change the assessment I must consider whether a change to the
   assessment would be fair (just and equitable) to the children and both parents.
   Relevant facts, findings made and application of the law

   Mr Zina and Ms Cento have the primary duty to financially support [Child 1]. This duty has priority
   over all other commitments of the parent other than expenses for their own self-support or the
   support of any other person or child they have the duty to maintain. Although Mr Zina mentions a
   duty to maintain another child in [Country 1], without further information being supplied I am unable to
   consider this any further.

   [Child 1] is one. There is no information before me that suggests he has income, property or financial
   resources from which he could contribute to his own self-support and I am satisfied he relies on his
   parents for financial support.

   I have found Reason 8A established in respect to Mr Zina’s financial resources. Although Ms Cento has requested a change be made from 26 June 2020, her application was prompted after the
   annual rate reduced when Mr Zina updated his 2018/2019 income to $5,800. Given that Ms
   Cento`s application was received in a timely manner after this event occurred, I will commence my
   decision on 4 August 2020, as I am satisfied the assessment was unfair on this date. I will continue
   my determination for a period three years, as I am satisfied future tax lodgements will not reflect all
   of the financial resources available to Mr Zina.

   The change being made to the assessment is:

   For the period 4 August 2020 to 3 August 2023, Mr Zina’s ATI will be set as $65,175 per annum.

   At this point I am required to compare my decision against the decision made by [Decision Maker 1] on
   1 February 2021. Although we have both found Reason 8A established, our findings differ. As this
   is a full merit review, [Decision Maker 1]`s decision is set aside and replaced with the decision as noted
   above.

   …

3. Mr Zina and Ms Cento participated in the Tribunal’s hearing by conference telephone. Both gave sworn evidence. Both parties were legally represented – Mr Zina by [Mr A], and Ms Cento by [Ms B]. In making its decision, the Tribunal took into account the CSA materials, and additional materials submitted by both parties. Additional materials submitted by Mr Zina after the hearing were not accepted into evidence.

CONSIDERATION

The legislative framework

1. The rate of child support payable by a liable parent is usually based on an administrative assessment under Part 5 of the Child Support (Assessment) Act 1989 (the Act). A formula is used. It takes into account variables including each parent’s adjusted taxable income for the last relevant year of income, the number of children and the level of care provided by each parent.

2. Part 6A of the Act allows for a departure from an administrative assessment (a process commonly known as a “change of assessment”). Under subsection 98C(1), the Registrar may make such a departure determination if three matters are established:

   ·     one, or more than one, of the grounds for departure referred to in subsection 98C(2) exists (subparagraph 98C(1)(b)(i));

   ·     a departure is just and equitable as regards the children and each parent (sub-subparagraph 98C(1)(b)(ii)(A)); and

   ·     it is otherwise proper to make a departure decision (sub-subparagraph 98C(1)(b)(ii)(B)). 

3. Subsection 98C(2) provides that the grounds for departure are the same as the grounds set out in subsection 117(2).

4. If satisfied that a ground or grounds exist and that it would be just and equitable and otherwise proper to make a particular determination, the Tribunal may make one of the determinations prescribed in section 98S of the Act. It permits a range of determinations, including varying the rate of child support payable, the adjusted taxable income or the cost percentage for a child.

Issue 1 – Is there a ground to depart?

1. Subparagraphs 117(2)(c)(ia) and (ib) of the Act, commonly referred to by the CSA as reasons 8A and 8B, provide as grounds for departure:

   (c)that, in the special circumstances of the case, application in relation to the child of 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:

   …

   (ia)      because of the income, property and financial resources of either parent; or

   (ib)       because of the earning capacity of either parent

2. The matters which must be taken into account when assessing a person’s earning capacity are contained in subsection 117(7B) of the Act, which provides the following:

   In having regard to the earning capacity of a parent of the child, the court may determine that the parent's earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied that:

   (a)  one or more of the following applies:

   (i)  the parent does not work despite ample opportunity to do so;

   (ii)  the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full-time work for the occupation or industry in which the parent is employed or otherwise engaged;

   (iii)  the parent has changed his or her occupation, industry or working pattern; and

   (b)  the parent's decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:

   (i)  the parent's caring responsibilities; or

   (ii)  the parent's state of health; and

   (c)  the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.

10.The starting proposition is that the child support formula should apply. Only in special circumstances should a departure be made. The words “in the special circumstances of the case” are not defined in the legislation. Whilst it is not possible to define with precision the meaning of that term, it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the legislature is that the Tribunal will not interfere with the administrative formula result in the ordinary run of cases. In Gyselman v Gyselman (1992) FLC 92–279, it was held that “special circumstances” were “facts peculiar to the particular case which set it apart from other cases”. The Tribunal’s approach to the interpretation and application of the particular grounds in subsection 117(2) must be guided by that qualification.

11.The written submissions on behalf of Mr Zina dated 13 December 2021 contain the following key submissions:

…

Mr. Zina further submits that for the period 4 August 2020 to 3 August 2023, his
income does not match the adjusted taxable income as stated in the assessment at

$65,175.00.

The key point that the Tribunal should take account of is the fact that Mr. Zina has
had no income for the past 2 years, as his main occupation was connected with work
he was doing in [Region 1] where he visited regularly before December 2019. Since the
Covid 19 outbreak, he has been prevented from traveling to [Region 1] and he therefore
had no work and received no income.

For the past 2 years Mr. Zina has been living off his savings and these have been
totally used up by his living expenses and mortgage payments. Further, Mr. Zina
has poor immediate prospects of employment in the foreseeable future, because of his
age, his lack of English language capacity and his limited skills and education. He
cannot pursue the work he had previously in [Region 1], because as explained below that

position is no longer available.

…

Mr. Zina's recent employment history

Mr. Zina had previously worked as employee for a variety companies in [Country 1]
before he tried to set up his own business.

In or about April 2019, Mr. Zina's former employer [Employer 1] withdrew their investment in [Country 2]. As a consequence, Mr. Zina suddenly
lost his job and became unemployed.

In order to have income, in or about April 2019 Mr. Zina tried to set up a business in
[Country 2] aiming to operate it on his own. As registration of the business took several
months, prior to business commencing, he came to Australia. As a result of Covid 19,
the business in [Country 2] was suspended and so the business project had made no
progress.

Mr. Zina has stayed in Australia from December 2019 to this day. He is currently
unemployed in Australia. He has used his saving to pay the mortgage and living

expenses.

Mr. Zina's employment history prior to April 2019

From 1986 to 1989, Mr. Zina worked for [Industry 1]
From 1989 to 1992, he worked for [Employer 2]
From 1992 to 2000, he worked for [Employer 3]
From 2001 to 2003, he worked for [Employer 4] to
provide [Product 1].
From 2004 to 2006, he was engaged in studies at [College].
From 2006 to 2009, he worked for [Employer 4].
In 2015, he worked for [Employer 1] while he migrated to
Australia.

His business in [Country 2] has not been developed as yet. To date the business has not
produced any income and has liabilities and few assets.

Mr. Zina's savings

Mr. Zina says that he received some money from a financial division of family
assets with his ex-wife but the said $110,000 of the said funds were paid to his
daughter [Ms C] on the financial agreement between him and his ex-wife [Ms D]. The remainder of the funds have been used for his living expenses and
mortgage payments in Australia. He now has no fu1iher saving and has sought
assistance from Centrelink while he continues to look for some work in [Industry 2].

Mr. Zina says his income at end of financial year 30 June 2021 was less than
minimum taxable income.

His estimates income at end of financial year 30 June 2022 will be less than minimum
taxable income.

It is unlikely Mr. Zina will return to his business in [Region 1] due to Covid 19 and the
loss of his business network over the last two years.

His business account statement shows his current financial status.

Mr. Zina seeks that the AAT make the necessary assessment on his current financial

status and in the light of his lack of English, lack of education /training, and his age.

…

12.[Mr A] raised an initial question about whether Ms Cento was entitled to bring a child support case. He said there are residency issues surrounding Ms Cento and [Child 1]. He submitted that whilst Mr Zina may be [Child 1]’s biological father, he is not [Child 1]’s “parent”. [Mr A] submitted that Ms Cento made commitments for her own support,  and should not be seeking financial support from Mr Zina.

13.[Mr A] submitted that Mr Zina has not been working over the last two years; his financial capacity is reflected in his adjusted taxable income as nil, or next to nil. [Mr A] submitted a suggestion that Mr Zina’s income is $65,000 is “grossly inaccurate”. Mr Zina has no other income and is supported by his children. He is presently unemployed and has no real prospects; he has made a claim with Centrelink for a jobseeker payment and is awaiting an outcome.  [Mr A] submitted that it is true that Mr Zina was once involved in a business [providing Product 1] in [Country 2], and was travelling overseas regularly. In 2017, the company he was working for went bankrupt. Mr Zina sought to take over some of that business to become self-employed. However, since the onset of the pandemic, he has not been able to travel to [Region 1], and the business has “collapsed”. [Mr A] said that Mr Zina receives no income or other benefits from the operation of the business. [Mr A] submitted that claims Mr Zina is claiming deductions and obtaining other benefits is “completely false”. It is true in finance applications Mr Zina had described himself as a “Business Development Manager”; however, that endeavour has failed. Mr Zina does not live an extravagant lifestyle; when he was regularly travelling overseas, he was employed and his employer met his travel costs. Claims Mr Zina owns “expensive machinery” are wrong. [Mr A] contended that gross exaggerations have been made on the basis of “nil” evidence.

14.[Mr A] submitted that Mr Zina’s property is encumbered by a very large mortgage of $1 million dollars. Repayments have been $4,000 per month – Mr Zina met those payments from funds he obtained through a family law division with his former wife (prior to Ms Cento). Whilst Mr Zina was able to meet those payments 3 or 4 years ago, he is no longer able to afford them. [Mr A] submitted that Mr Zina was obliged to repay his adult daughter $110,000 as she contributed to the purchase of the family home (she also resides at the property). This was repaid in March 2021. Mr Zina has largely dissipated all his funds now. [Mr A] submitted that Mr Zina’s daughter has been contributing to the mortgage; they have agreed to pay $2,000 per month each. [Mr A] said an agreement has been made that Mr Zina’s daughter holds an equitable interest in the property and there is an agreement for them to become joint tenants.

15.[Mr A] submitted that Mr Zina has no financial resources from which to pay child support. He raised issues of property held by Ms Cento in [Country 1], and claimed she could sell that property to support herself. Ms Cento has family in Adelaide (her mother is married to an Australian citizen). [Mr A] submitted Ms Cento wanted to come to Australia to be close to her mother, and initially lived with her upon her arrival. [Mr A] submitted it was highly likely Ms Cento’s mother was providing her with some financial support. Ms Cento is a qualified [Occupation 1], and should be able to secure employment in some form.  

16.[Ms B] pointed the Tribunal to the written submissions dated 20 October 2021, which included the following: 

The relationship

1. Ms Cento and Mr Zina were married on 3 July 2019 and separated on 25 October 2019.

2. There is one child of the marriage, [Child 1] born [January] 2020.

3. Ms Cento has 100% care of the child and currently reside together in a refugee.

…

Mr Zina’s financial position

1. In his Application for Review, Mr Zina states that his income does not match the adjusted taxable income set by the Objection decision at $65, 175.

2. Mr Zina is self-employed (“T documents pages 77-78 and 129) and runs a business in [Country 2] [providing Product 1]. As Mr Zina is self-employed, he has the ability to take advantage of the various deductions available to him and not to the ordinary taxpayers. This allows him to reduce his taxable income and hence is child support income.

3. Mr Zina owns a property situated at [Address 1] Victoria (“T” documents page 61). Mr Zina purchased the property on 24 June 2017 for $1.21M (“T” documents pages 57-59).

4. Mr Zina’s employment titled on his loan application dated 25 July 2017 is “Business Development Manager” (“T” documents page 105) and his net monthly income is $8,121.10. A monthly net income of $8,121.10 equates to approximately a gross yearly salary of $135,000. (“T” documents page 105)

5. Mr Zina is meeting monthly mortgage repayments of $4,311.60 which annualises to $51,739.20 net or $63,000 gross. Mr Zina’s has been able to meet his monthly loan commitments of $4,311.60 whilst continuing to save and has approximately $136,000 in savings.

6. Mr Zina notes that he has 100% ownership of the following assets on his loan application (“T” documents page 105):

a. Car ([make, model]) - $50,000

b. Other assets - $30,000

c. Other savings account - $250,000

7. Ms Cento describes the lifestyle during the relationship which enabled a high standard of living for the family as follows:

a. Mr Zina would frequently travel between [Country 1], [Country 2], [Country 3], [Country 4], [City 1] and Australia in pre-Covid19 times (“T” documents pages 252-254).

b. Mr Zina’s ability to meet his monthly loan commitments of $4,311.60 and have a bank balance of $136,000 in savings is inconsistent with an annual income of less than $65, 175.

c. Mr Zina owned large expensive machinery overseas as part of his business in [Country 2].

d. Mr Zina told Ms Cento many times when they were together that his monthly income was $30,000USD.

e. Furthermore, Mr Zina has a factory in [Country 1] and Australia.

8. Ms Cento seeks that Mr Zina be required to provide his financial documents from July 2019 to the AAT as she believes Mr Zina transferred property and assets after the incidents of family violence. It is submitted that without a complete overview of Mr Zina’s financial documents from July 2019, his child support income will not be accurate reflection of his financial circumstances.

Ms Cento’s financial position

1. Ms Cento is a qualified [Occupation 1] in [Country 1] however is unable to work in Australia as she is required to retrain in Australia.

2. Ms Cento is unable to work as she is the primary carer of the child and cannot leave him with anybody.

3. She is ineligible for government benefits due to her Visa status.

4. Ms Cento has been residing in a refugee since November 2019 and relies on donation from [Organisation 1] to pay for food, clothes, and baby supplies.

5. Although Ms Cento has a property in [Country 1], her daughter from a previous relationship resides in the home with Ms Cento’s father who takes care and supports the child.

6. Further details of Ms Cento’s dire financial position may be found in her Financial Statement.
…

Just and equitable considerations

Ms Cento is a single mother who is unable to work due to her caring responsibilities and is unable to receive any Centrelink benefits due to her Visa status. Ms Cento struggles financial to meet the day to day expenses of the child including food. She has no family upon whom to rely on in Victoria and fled the relationship with the Payer due to Family Violence. Ms Cento is currently in secured accommodation and eventually will need to find a place for herself and her child.

The current assessment will not cover the child’s basic formular which is a basic living expense. My client cannot work because she is the child’s primary carer and cannot leave him with anybody. She relies solely on donations received from [Organisation 1] and [Organisation 2] to financially support herself and her child. Furthermore, English is not her first language, and she requires an interpreter for all transactions.

Ms Cento seeks that the Administrative Appeals Tribunal make the necessary enquiries to ascertain the Payer’s child support income and set his child support liability accordingly and retrospectively from the date the child support assessment commenced.

17.[Ms B] contends that Mr Zina’s income should be set on the “cap amount” of some $200,000 per annum. In short, Mr Zina is self-employed and runs a business in [Country 2]. He frequently travelled overseas. As a self-employed person, he has access to various deductions not normally available to ordinary taxpayers.

18.[Ms B] submitted that Mr Zina had told Ms Cento in the early stages of their relationship that he was making some $30,000 USD per month, and that he had the means to sponsor her. Ms Cento’s property (worth around $60,000 AUD) in [Country 1] is occupied by her eight-year-old daughter, who goes to school nearby. Ms Cento is not able to practise [Occupation 1] in Australia, and is the sole carer for [Child 1] and not able to work. Ms Cento has significant language barriers. She had never expected to be supported by her mother in Adelaide as she came to Australia to marry Mr Zina in Melbourne.  Ms Cento told the Tribunal that Mr Zina owns two properties in [Country 1] which are both vacant. [Mr A] submitted those properties are owned by Mr Zina’s mother. [Ms B] drew attention to a “Pre-nuptial Property Agreement” dated 30 June 2019 (folio 133 of the CSA materials) in which Mr Zina declares ownership of property in [Country 1]. Ms Cento suggested that Mr Zina was trying to distance himself from marital assets. 

19.During questioning from [Ms B], Mr Zina initially denied he had advised the CSA he wished to travel to [Country 1]. When [Ms B] drew Mr Zina’s attention to a file record made by CSA recording he had indicated he wish to travel, Mr Zina said that “had nothing to do with child support” and that he has family in [Country 1]. Mr Zina said he no longer had his car (a [make, model]) which had been “written off”. [Ms B] observed Mr Zina had indicated to the bank that vehicle was worth $50,000 in his loan application in July 2017 (folio 105 of the CSA papers). Mr Zina said “he never said that”. Mr Zina said the sum of $30,000 identified as “other assets” was likely furniture and other belongings. Mr Zina said “rental income” of $1,950 was “four years ago, not now”. Mr Zina denied he had been required to supply the bank with any supporting documentation to support his income position.

20.[Ms B] submitted that negative inference should be drawn from Mr Zina’s failure to comply with the Tribunal’s directions. She submitted Mr Zina has not cited any health concerns and there is no reason he should not be able to work. [Ms B] said that Mr Zina’s daughter’s alleged equitable interest in Mr Zina’s property is only now being raised at the same time as property issues are before the Federal Circuit Court. [Ms B] submitted that, going forward, Ms Cento would seek an adjustment to Mr Zina’s income for a further three years to avoid having to reagitate matters with the CSA in the meantime.

Consideration

21.[Mr A] raised an issue at the outset of proceedings as to whether a valid child support case exists. He distinguished a “parent” from a “father”; whilst apparently conceding Mr Zina is [Child 1]’s biological father (supported by the DNA evidence), he suggests Mr Zina is not a “parent” in that he does not, nor does he apparently intend, to have any involvement with [Child 1]. The Tribunal observes the child support scheme is solely concerned with the fact that Mr Zina is [Child 1]’s biological father; there is no requirement for Mr Zina to have any form of active parental involvement with [Child 1]. For the purposes of Part 4 of the Child Support (Assessment) Act 1989, [Child 1] is an eligible child, and Ms Cento is a parent eligible to apply for a child support assessment: see sections 24 and 25 of the Act.  Ms Cento can never be “estopped” from accessing the child support scheme on the basis of any undertakings she may, or may not, have made before or after [Child 1]’s birth.

22.The Tribunal observes that Mr Zina indicated in a directions hearing that he has working as a [Occupation 2], and that he agreed he would supply payslips. In his statement of financial circumstances, Mr Zina had identified he was doing “odd jobs”, including [Occupation 2]. Directions were made for a number of materials, including payslips. Mr Zina did not comply with those directions as of the date of the hearing; the submission on his behalf at the hearing was that, over the last couple of years, he has been unemployed. Upon questioning from [Ms B], Mr Zina initially denied he had advised the CSA of his desire to travel to [Country 1]; when directed to the CSA file records which indicated he had said as much to the agency, Mr Zina indicated that a desire to travel to [Country 1] had nothing to do with child support.

23.The Tribunal does not consider Mr Zina an entirely reliable witness. To the extent of inconsistency, the Tribunal generally preferred the evidence of Ms Cento. The Tribunal is not satisfied that Mr Zina has been full and frank in his financial disclosures, and in the Tribunal’s assessment, has more likely than not made decisions about his financial arrangements with a view to minimising any liability for child support, and with a view to his position in the ongoing family law dispute.

24.It is a difficult matter on the evidence available to the Tribunal to establish Mr Zina’s true financial means. Mr Zina made representations to his bank in 2017 of income of over $8,000 (net) per month; he says that since he lost his employment position, and with the impacts of COVID-19, his income has reduced to effectively nothing. The Tribunal has already observed that it does not find Mr Zina’s evidence generally reliable; that said, a suggestion that Mr Zina’s income may have been affected by his inability to travel and the affects of the pandemic appear plausible. The lack of financial documentation concerning Mr Zina’s business arrangements makes it extremely difficult to assess that aspect of Mr Zina’s financial capacity. The Tribunal accepts that Mr Zina represented to Ms Cento in what might be described as a “courtship phase” of the relationship that he was very wealthy and deriving something in the range of $30,000 USD per month; that may, or may not, have involved an element of exaggeration on his part.

25.Mr Zina’s income under the formula arrangements has been assessed as $5,800 per annum. His capacity to support himself and continue to meet mortgage commitments suggests his financial capacity is appreciably higher than the assessed level of income. In the special circumstances of the case, the child support assessment is rendered unfair. There is a ground to depart from the formula.

Issue 2 – Is it just and equitable to depart from the administrative assessment?

26.The next relevant consideration for the Tribunal is whether a departure from the administrative assessment is just and equitable. This enquiry directs attention to what is fair to the parents and their children. Regard must be had to a variety of factors such as the needs of the children, the parents’ commitments and any hardship that would be caused by departing or not departing from the formula.

27.The Tribunal observes that section 2A of the Administrative Appeals Tribunal Act 1975 requires the Tribunal to be fair, just, economical, informal and quick. The Tribunal is not placed in this application to undertake a forensic accounting exercise, and has limited evidence from which to draw deductions about Mr Zina’s financial capacity and to determine a fair level of child support. The Tribunal observes the principal object of the child support law is to ensure that [Child 1] receives a proper level of financial support from his parents. Notably, other parties, including Ms Cento’s parents, are not liable to support [Child 1]; that responsibility rests solely with [Child 1]’s biological father and mother.

28.The Tribunal observes that both parties raised issues of property ownership overseas. As a general principle, property matters are treated separately from child support matters; it appears property issues will be considered in the course of family law proceedings. The evidence does not suggest that any adjustment to the income positions of the respective parties is warranted on the basis of ownership of any modestly-valued real estate located overseas.

29.Mr Zina’s evidence is that he is still connected with a business overseas, but that his business is “undeveloped” and has “collapsed”. No financial statements or other supporting documents have been produced in support of the contention that the business is deriving no income. Mr Zina declared in his statement of financial circumstances that he works doing “odd jobs” with an average income of $120, without any documents to verify his earnings. The Tribunal makes the general observation that unemployment in Australia is at historic lows, and that notwithstanding Mr Zina’s language issues, his prospects appear likely better now than in more recent years for securing regular employment if he chose that path. The evidence reveals that in around March 2021, Mr Zina elected to make a payment exceeding $110,000 to his adult daughter in preference to allocating sums for his own needs or making any provision for child support.

30.The Tribunal must make the best assessment it can on the limited evidence available to it, bearing in mind the objects of the scheme prioritise [Child 1]’s needs.

31.In the Tribunal’s assessment, the best evidence of Mr Zina’s financial capacity is represented by his demonstrated capacity to meet loan repayments of some $50,000 per year (in round terms), in addition to being able to meet his own basic needs. The “self-support amount” (the amount deducted from a person’s adjusted taxable income under the formula for a person’s own support) in 2021 is a figure of just over $26,000. Accumulating those sums, this results in a total adjusted taxable income of $76,000 as a fair reflection of Mr Zina’s financial capacity for child support purposes. In 2021 figures, this will result in Mr Zina being liable for just over $8,000 per annum in child support for [Child 1]. The Tribunal considers that, with careful budgeting, Mr Zina will be placed to meet his ongoing child support liability to meaningfully support his son.

32.The Tribunal finds no adjustment is required in respect of Ms Cento; she is in a dire financial position with limited Centrelink support, and requires substantial assistance from community organisations. She is not in a position to work given her care responsibilities for [Child 1], and the limitations on her overseas-based qualifications. No particular expenses for [Child 1] were identified which would warrant any other particular adjustments.

33.

The Tribunal considers it appropriate to modify Mr Zina’s income in the assessment from 4 August 2020 (the same date selected by the CSA).  In terms of going forward, there is tension between giving certainty to the parties and possible future material changes which might materially impact either parent’s financial capacity. In the circumstances of this case, the Tribunal considers it just and equitable that Mr Zina’s income be varied until

31 October 2023, at which time financial information for 2022/23 may be available to be taken into account in a possible reassessment in the event one or both parties seek a further departure.

Issue 3 – Is it otherwise proper to make a departure determination?

34.The requirement to consider whether a departure would be otherwise proper directs attention to what is fair to the community. It is necessary to consider the effect of any departure from the administrative assessment on entitlements to income-tested pensions, allowances and benefits. Parents rather than the community have the primary duty to maintain a child.

35.The rate of child support should reflect the obligation of both parents to take financial responsibility for the children and, where increased, may decrease any income-tested benefits payable. A departure is therefore proper.

36.As the Tribunal has reached a different conclusion to the objections officer, the decision under review will be set aside.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that, for the period 4 August 2020 to 31 October 2023, Mr Zina’s adjusted taxable income is varied to $76,000.