Tribunal: Member Stephanie Brakespeare
Ms Wolford was paying child support to Mr Fendi for their two children. Both Mr Fendi and Ms Wolford applied to the Department of Human Services to change the amount of child support that needed to be paid from mid-2017 to mid-2018.
The Department of Human Services uses a formula to calculate the child support payable by one separated parent to the other. This is called an “administrative assessment” and the formula contains a number of variables including the parents’ adjusted taxable incomes and their percentages of care of the children. For the period relevant to this application, child support was calculated on the basis that Mr Fendi had no taxable income and that he had more than 80% care of the children.
An administrative assessment may be departed from for several reasons, which are called grounds. The ground must involve a special circumstance for it to be established. The administrative assessment may be departed from and the child support payable changed if one of these grounds exists, and it would be just and equitable and otherwise proper.
The Department originally decided to depart from the administrative assessment after finding a ground for departure existed but on objection decided a ground did not exist and refused to depart from the administrative assessment. Ms Wolford applied to the AAT for a review of this decision.
Ms Wolford claimed the amount of child support she had to pay in the period should change because the administrative assessment of the child support was unjust and inequitable because of the income, property and financial resources and earning capacity of Mr Fendi.
Ms Wolford claimed Mr Fendi was not declaring income that he was receiving from a private business he continued to run and she claimed to have video evidence of him undertaking activities related to the business. Mr Fendi said he had closed the business and the activities on the video were undertaken as a part of his volunteer work.
Mr Fendi said that his only sources of income were the Newstart allowance and the family tax benefit. He said he had also received a $120,000 loan from his mother, which he was unable to continue paying off because he was struggling to meet the needs of himself and his children.
The AAT did not accept Ms Wolford’s claim that Mr Fendi was receiving significant income from any other source than those that he had provided and did not find a ground existed on that basis.
Ms Wolford also claimed that the administrative assessment of the child support was unjust and inequitable because of Mr Fendi’s earning capacity. She claimed that Mr Fendi was not exercising his earning capacity because he had a much broader capacity to work and that was not shown by his current efforts to find employment. Mr Fendi said he stopped working in 2012 because he had to care for his children and Ms Wolford, who had a disability. He claimed his current job search efforts were hampered by the fact that he could not undertake jobs that would require him to work away from home because of his caring responsibilities for the children. He said that as a part of his Newstart allowance he needs to apply for at least 20 jobs a month and also be engaged with an employment services provider.
The AAT discussed what must be considered when determining if Mr Fendi’s earning capacity is greater than what is reflected in the income used in the administrative assessment. The AAT found that Mr Fendi did not satisfy any of these considerations and there was no ground for departure from the administrative assessment on that basis.
The AAT concluded that none of the grounds for departure existed and refused to change the child support payable.
Read the full written decision on AustLII.
 See Part 5 of the Child Support (Assessment) Act 1989
 The grounds for departure are listed in section 117(2) of the Child Support (Assessment) Act 1989