Leworthy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and Anor [2011] AATA 869 (8 November 2011)

Last Updated: 8 December 2011

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2011] AATA 869

ADMINISTRATIVE APPEALS TRIBUNAL )

) No: 2011/2645

GENERAL ADMINISTRATIVE DIVISION )

Re

MANDY LEWORTHY

Applicant

And

SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent
And VICKI STEWART-CAIN

Other Party

DECISION

Tribunal

Mr C. Ermert, Member

Date 8 November 2011

Place Melbourne

Decision

For the reasons given orally at the conclusion of the hearing of this matter, the Tribunal: sets aside the decision of the Social Security Appeals Tribunal dated 10 June 2011, as amended 28 June 2011; and in substitution decides that, for the periods 1 July 2009 to 30 June 2010 and 1 July 2010 to 8 May 2011, the children were in Mr Cain’s care for 34% of the time, meaning that Ms Stewart-Cain was not entitled to Family Tax Benefit in respect of the children during these periods.

......................[signed].........................

Member

FAMILY TAX BENEFIT – pattern of care – whether care over 35 per cent – earliest date of effect – decision set aside

Administrative Appeals Tribunal Act 1975 (Cth) s 37

A New Tax System (Family Assistance) Act 1999 ss 22, 25, 35B, 35M

A New Tax System (Family Assistance) (Administration) Act s 111B

REASONS FOR DECISION

8 December 2011

Mr C. Ermert, Member

INTRODUCTION

1. Ms Leworthy, the applicant in this case, and Mr Cain, her former husband, are the parents of two boys born in 1998 and 2002. Mr Cain’s current partner, Ms Stewart-Cain, is the other party in this case. In 2005 the Magistrate’s Court made orders by consent regarding the residence of the children and their contact with their parents. With one minor exception, the parties have followed those orders.
2. In September 2008 Centrelink, the service provider for the Department of Families, Housing, Community Services and Indigenous Affairs, decided not to pay Ms Stewart-Cain Family Tax Benefit (FTB) on the basis that she had care of the children for 34 per cent of the time in the 2007/2008 financial year. On 19 March 2009 an authorised review officer (ARO) of Centrelink calculated that, based on nights in care, Ms Stewart-Cain had care of the children for 36 per cent of the time. When based on hours in care, the ARO calculated that she had care of the children for 32 per cent of the time. The ARO varied the original decision, deciding that Ms Stewart-Cain’s care of the children should be recorded as 32 per cent as from 1 July 2008.
3. On 4 April 2011 Ms Stewart-Cain applied for a review of that decision by the Social Security Appeals Tribunal (SSAT). In June 2011 the SSAT varied the decision and decided that Ms Stewart-Cain was entitled to be paid FTB on the basis that she had care of the children for 35 per cent of the time from 1 July 2009. This application seeks review of that decision.
4. These written reasons are essentially the same as the oral decision handed down at the hearing. The introduction, details of the hearing and the recitation of the evidence are included for completeness.

THE HEARING

5. Ms Leworthy attended the hearing in person and gave evidence. Ms Stewart-Cain attended the hearing via telephone. Mr A Carson, a Centrelink advocate, represented the respondent. The Tribunal had before it the documents provided by the respondent in accordance with s 37 of the Administrative Appeals Tribunal Act 1975 (the T-documents). The Tribunal took into evidence three documents from Ms Leworthy (Exhibits A1 to A3). The Tribunal also had before it the respondent’s Statement of Facts and Contentions and supplementary T documents (ST1 to ST4).

THE ISSUE

6. The issues to be determined are:
   • the pattern of care of the children from 1 July 2008; and
   • the date of effect of the Tribunal’s decision in this regard.

THE EVIDENCE

7. Ms Leworthy testified that the provisions of the court orders as shown in the respondent’s Statement of Facts and Contentions were correct and, with one exception, were adhered to by the parties. The exception was the pick-up time on Wednesdays. This had been changed by agreement from 4.30pm to 5.00pm. Ms Leworthy said that they treated the weekends prior to school holidays as part of the holidays. She said that the children were always with her on the last Sunday of the holidays. Ms Leworthy agreed with the number of days of each party’s care shown in the Statement of Facts and Contentions. She noted that the part days in 2008-09 were rounded down, while those in 2009-10 were rounded up.
8. Ms Stewart-Cain told the Tribunal that in 2009 the Child Support Agency (CSA) had calculated that she had care of the children for 35 per cent of the time, whereas the Family Assistance Office calculated her level of care as 32 per cent. Ms Stewart-Cain also pointed out that the SSAT found that her level of care was between 35 and 36 per cent. Ms Stewart-Cain stated that she just wanted a third party to determine the correct level of care. She said that she had not done any calculations herself. She also agreed that the parties were following the court orders with the exception of the change in pick-up times on Wednesdays. Ms Stewart-Cain confirmed that the children are with Ms Leworthy on the Sundays at the end of school holidays. She also said that the children were with her on the Fridays at the start of the school holidays.

SUBMISSIONS

9. Ms Stewart-Cain re-iterated that the schedules and times are regular and that the correct level of care should be calculated by a third party, on the basis of days and hours.
10. Ms Leworthy contended that the SSAT had made an incorrect decision.
11. Mr Carson said he would rely on the reasoning in the respondent’s Statement of Facts and Contentions. He submitted that the Tribunal should make a decision in accordance with the order sought in the Statement of Facts and Contentions.

CONSIDERATION

THE PATTERN OF CARE

12. The basis of the pattern of care is determined by the orders made by the Magistrate’s Court. The relevant orders are:

THAT the husband have contact with the children as follows:

(a) Every Wednesday at 4:30pm [subsequently changed by mutual agreement to 5:00pm] until Thursday at 9:00am;
(b) Every alternate weekend commencing 4:30pm Friday and concluding 4:30pm Sunday commencing 11 March 2005;
(c) For one half of each of the short term and long term school holiday periods with the husband to be in substantial attendance;
(d) From 6:00pm on Father’s Day eve until 6:00pm on Father’s Day and that in the event that the children are on contact with the father on Mother’s Day contact be suspended at 6:00pm on Mother’s Day eve that weekend;
(e) During the Christmas holiday period in alternating years, in the first year from 4:00pm on Christmas Day until 12:00 noon on Boxing Day 2005 and each alternate year thereafter and in the alternate year from 6:00pm on Christmas Eve until 4:00pm on Christmas Day in the year 2006 and each alternate year thereafter;
(f) On each of the children’s birthdays and the husband’s birthday for not less than three hours;
(g) At other times by mutual agreement between the parties.

13. The relevant legislation is the A New Tax System (Family Assistance) Act 1999 (the Act) and the A New Tax System (Family Assistance) (Administration) Act 1999 (the Administration Act). Until 30 June 2010, section 22(6A) of the Act relevantly provided that when an individual is an FTB child of another individual the Secretary must determine the percentage of the period during which the child was, or will be, in the care of that individual. A similar provision is now found in section 35B(1) of the Act. Under section 25 of the Act, if the Secretary determines that the child was in the care of an individual for less than 35 per cent of a period, the child is taken not to be an FTB child of that individual or any part of the period.
14. Prior to the hearing, the Tribunal had reviewed the respondent’s calculations of the days that the boys spent in each party’s care. The calculations were based on the provisions of the court order. The Tribunal confirmed the calculations by referring to calendars for 2008, 2009 and 2010 and counting the days applicable to each party. At the hearing, the Tribunal informed the parties of that review process and told the parties that it had arrived at the same results as those shown in the respondent’s Statement of Facts and Contentions.
15. In the Statement of Facts and Contentions, the respondent contended that Mr Cain’s total care of the children would be:
    • for financial year 2008/09 – 121 days;
    • for financial year 2009/10 – 123 days; and
    • for financial year 2010/11 – 124 days.
16. The Tribunal is satisfied that the respondent has correctly determined these days of care. Converting these figures into percentages and rounding down as required by section 22(6B) of the Act (prior to 1 July 2010) and section 35M of the Act (since 1 July 2010) results in the following percentage of care:
    • for financial year 2008/09 – 33 per cent;
    • for financial year 2009/10 – 33 per cent;
    • for financial year 2010/11 – 33 per cent.
17. The Tribunal notes that, if the calculation were to be done by hours, the proportion of hours in the care of each party for full days would remain unaltered. The hours for the part-time days would result in fewer hours for Ms Stewart-Cain compared to Ms Leworthy. Accordingly, the Tribunal is satisfied that calculating the pattern of care by hours would result in a percentage of care of less than 33 per cent for Ms Stewart-Cain.

THE DATE OF EFFECT

18. In considering the date of effect of this decision, the Tribunal notes that the ARO decision was made on 19 March 2009. Mr Stewart-Cain did not seek review of the SSAT’s decision until 4 April 2011. This is more than 13 weeks after she was notified of the decision. In these circumstances, section 111B(1)(f) of the Administration Act provides that any determination cannot take effect earlier than 1 July 2009, being the first day of the income year before the income year in which the application to the SSAT was made.
19. Section 111B(2) of the Administration Act provides for the exercise of a discretion if there are special circumstances that prevented the applicant from making an application within 13 weeks. In this case, Ms Stewart-Cain did not seek the exercise of the discretion and she did not present any evidence in regard to special circumstances.
20. Accordingly, the Tribunal is satisfied that the pattern of care between 1 July 2009 and 8 May 2011 is that the children were in Ms Stewart-Cain’s care for 33 per cent of the time. The Tribunal finds accordingly. The Tribunal also finds that there are no special circumstances to exercise the discretion for a date of effect earlier than 1 July 2009.

DECISION

21. The Tribunal sets aside the decision under review and in its place decides that from 1 July 2009 to 30 June 2010 and from 1 July 2010 to 8 May 2011 the children were in Mr Cain’s and Ms Stewart-Cain’s care for 33 per cent of the time and that Ms Stewart-Cain is not entitled to FTB in respect of the children during these periods.

I certify that the twenty-one [21] preceding paragraphs are a true copy of the reasons for the decision herein of:

Mr C. Ermert, Member

Signed:...............................[signed].......................................

Clerk Y. Maker

Date of Hearing 8 November 2011

Date of Decision 8 November 2011

Date of Written Reasons 8 December 2011

Advocate for the Applicant Self-represented

Advocate for the Other Party Self-represented

Advocate for the Respondent Mr A. Carson, Centrelink Advocacy Branch