Bond v Child Support Registrar & Anor 2018 FCCA 422
In the case of Bond v Child Support Registrar & Anor  FCCA 422 (23 February 2018), the Federal Circuit Court confirmed the decision of the AAT on the basis that loans from his father consisted a financial resource of the father in the child support context.
There had been a determination by the Administrative Appeals Tribunal and an appeal followed.
“The decision in question, which was appealed, set aside an earlier determination of a senior case officer within the Child Support Agency and subsequently confirmed by an objections officer to fix the Applicant’s adjustable taxable income for the purpose of calculating child support at an amount of $127,500 for the period from 28 April 2016 to 27 April 2018″.
The issue was “whether the Tribunal properly acquitted the jurisdiction conferred upon it or fell into legal error when it characterised sums of money advanced to the applicant concerned to be a financial resource within the ambit of the Child Support legislation”.
The mother had applied on 28 April for a change of assessment because the current assessment didn’t, in her view, reflect the father’s income, property and financial resources, a reason 8 application. The mother relied on the fact that her former partner had received regular payments from the paternal grandfather who also paid mortgage payments and other household expenses incurred by the father.
The senior case officer had found that the father received significant financial benefits from entities controlled by the paternal grandfather. Those benefits were assessed to be a weekly amount of $1,330, together with an additional amount of $2,709. The corporate entities related to the paternal grandfather also provided the father with a company motor vehicle.
The father objected, and his objection was disallowed. The father applied to the Social Services and Child Support Division of the AAT for a review. The AAT set aside the decision and determined that the father’s taxable income should be varied upwards to $127,500 and the father then sought a review.
The central issue for the Tribunal was how the various sums advanced to the father and which supported his recurrent living expenses were to be categorised for child support purposes. The father asserted the sums constituted loans which necessarily would have to be paid back at some stage or another. On the other hand, it was the mother’s position the father regularly received money which she asserted was not reflective of a person who was in strained financial circumstances.
The paternal grandfather gave evidence at the AAT. The paternal grandfather was described by the AAT as a lawyer and tax specialist. Neither the father nor the paternal grandfather disputed the existence of either the company or the trust or that the company had regularly advanced monies to the father. The controversy centres only on the characterisation of the sums in question.
The court said: “The provenance of the regular deposits appearing in the bank statement was germane to the Tribunal’s inquiry”.
The father deposed that he fully intended to repay the sums, and indeed was under some pressure to do so from his father as he, the paternal grandfather, was in ill health and wished to retire from fulltime work. His efforts at repayment had been delayed by his own recent ill health.
The father was questioned about the loans. The paternal grandfather paid the council rates and levies on the property owned by the father in which he lived, and the cost of his health insurance. Each such sum was characterised as a loan. There was ostensibly a loan agreement.
The paternal grandfather had not asked for security because his son had “promised to repay the sums and he owns the house”. The paternal grandfather considered the written agreement amounted to an equitable charge over the house. The paternal grandfather couldn’t tell the AAT the exact amount that had been advanced to his son. The paternal grandfather was asked if he kept records of the loans and he answered, “Yes. Sure. Well, I don’t know that there were any ledgers established for him for these particular loans”.
The grandfather was asked to characterise the payments and said:
“Well, they are entirely at my discretion, and they’re only made to him because he doesn’t have any resources with which to sustain himself at the present time. So – so I would regard them as compassionate loans. Not really a financial resource of his except if he’s able -to the extent he’s able to create income for himself the payments would reduce and – or he’s able to modify his lifestyle in some way that – or worst-case scenario, if I can’t sustain him, he will – can’t assist him, then he will have to realise the only asset he has”.
The paternal grandfather’s view was that the payments were at his discretion and couldn’t be regarded as being permanent in nature. The paternal grandfather was 73.
The father hadn’t been required to make any repayment of the amounts paid. The Tribunal considered the meaning of financial resource in section 117(2)(c)(ia) of the Assessment Act and considered the description in Walker v Fielding (SSAT Appeal)  FMCAfam 320 at  & :
“The term financial resource in the light of the objects of the Assessment Act should be broadly defined and would, in my consideration, refer to any financial benefit that would enhance the capacity of parents to provide a proper level of financial support for their children.”
The SSAT had found that the sums advanced to the father amounted to $107,168 per annum. The Judge then listed the Tribunal’s findings. On the topic of hardship, the Tribunal said:
“He may lose his house as the business can request instant repayment of the loans. On the basis of the longstanding conduct of the business in not seeking repayment of the loans and the express ability to address the loans in distributions under Mr Bond Senior’s Will, I do not consider it likely in the immediate future that the business will require repayment of or any or all of the loans.”
The Tribunal determined that they did not consider that the loss of his house or bankruptcy was a realistic concern.
There was a determination that he would not have the capacity to pay a retrospective increase in his child support liability.
The court dealt with the legislative framework, and this of itself is of interest.
A reference was made to the Child Support Registrar & Crabbe and Anor  FamCAFC 10 at 54. That was summarised in the Decision .
The court then considered the grounds of appeal. The financial resource argument was the most significant. The Tribunal had categorised the loans from Mr Bond Senior within the statutory confines of section 117(2) of the Assessment Act:
“This task required it to consider the manner in which the payments had been utilised in the past and their potential prospect of implications particularly in terms of their continuity and how Mr Bond would apply them.”
The court referred to the requirement of a decision maker to make a prediction and part of the task would require the assessment of whether some possibility is farfetched or improbable or otherwise. The court accepted that the Tribunal did undertake a predictive task. The court determined that the assessment was legally open to the Tribunal and is not one which can be characterised as legally unreasonable.
The court and the Tribunal had to deal with the issues which turn on a factual enquiry. The court was satisfied: “The Tribunal did embark on such an enquiry and its various findings were capable of being supported by the evidence”.
The court accepted that the Tribunal was entitled to apply the authority of Walker & Fielding (SSAT Appeal)  FMCAfam 320 to the Decision.
This case is an interesting one. The court concluded that it did not consider that the Applicant had established any of the grounds of appeal asserted by him. There was then a costs argument and the Child Support Registrar was awarded costs in the sum of $5,000 by reference to the applicable scale.