Luton v Lessels & Anor C40/1995 [2000] HCATrans 251 (24 May 2000)

IN THE HIGH COURT OF AUSTRALIA

Registry No C40 of 1995

B e t w e e n -

ANTHONY IAN LUTON

Plaintiff

and

GILLIAN GLADYS LESSELS

First Respondent

THE REGISTRAR, CHILD SUPPORT AGENCY

Second Respondent

Summons to state a case pursuant to section 18 of the Judiciary Act 1986

CALLINAN J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 24 MAY 2000, AT 9.15 AM

Copyright in the High Court of Australia

MR G.C. CORR: May it please the Court, I appear for Mr Luton, together with my learned friend MS G. WONG. (instructed by Tjakamarra Forrest Solicitors)

MR C.J. HORAN: If the Court pleases, I appear for the Registrar of the Child Support Agency. (instructed by the Australian Government Solicitor)

HIS HONOUR: There is no appearance for the first respondent?

MR CORR: I believe not, your Honour.

HIS HONOUR: Why has the first respondent been joined?

MR CORR: Ms Lessels?

HIS HONOUR: Yes.

MR CORR: She is the person who - - -

HIS HONOUR: Who gains the benefit of the payments.

MR CORR: Yes, she is the person who made the original application to the Child Support Agency and initiated the matter and is the person who is likely to obtain any benefit if the matter is determined that the Child Support Agency is in fact - there has been a valid enactment establishing it.

HIS HONOUR: You had better tell me why there is at least a prima facie case for the contentions that you would make.

MR CORR: Yes, your Honour. As stated in the draft case stated, Mr Luton and Ms Lessels have a child. Ms Lessels has made an application that there should be child support paid to her. Under the legislation, the Child Support Agency can collect that particular money from Mr Luton. There are various ways of enforcing that, either via various means of either garnisheeing his wages, or if there are some tax credits that Mr Luton has, then the Child Support Agency can take those directly and pay them to Ms Lessels.

The simple argument that is put on behalf of Mr Luton is that for the Commonwealth to say to citizen A, "We are going to take money from you and pay it to citizen B", there can be only two ways of dealing with it. Firstly, that there should be a tax, "We are taxing you and we are then going to pay it to citizen B". That is quite a valid way of doing so. However, the way that the child support legislation has been set up, it does not comply with the formalities contained within section 55 of the Constitution, that the legislation itself contains more than just imposing the taxation. There are a number of matters contained in that.

HIS HONOUR: What is the difference between this and the garnishee provisions that one sees as an aid to enforcement of court judgments?

MR CORR: That is following a court judgment and that is the second limb of the argument, your Honour, that if it is not a tax then it is just setting down legal rights and obligations between two parties. In order to enforce the legal rights between two parties, there needs to be a determination by a court or a judicial officer and the Child Support Agency is not a court or a judicial officer. So the argument is that there is no power contained within the Commonwealth Constitution which allows the Parliament to pass legislation which enables the administrative arm of government to take money from citizen A and give it to citizen B.

HIS HONOUR: There was no order for maintenance made by the Family Court is there?

MR CORR: No, it is purely an administrative - - -

HIS HONOUR: Was an application for maintenance made in the Family Court?

MR CORR: No, I believe not, your Honour.

HIS HONOUR: Why not?

MR CORR: After 1989 when the legislation came in then it was no longer something which was contained - no longer a judicial determination that there should be maintenance paid. That is part - - -

HIS HONOUR: Because it became unnecessary to make an application for maintenance, is that what you say?

MR CORR: Yes, because it became an administrative function, that in fact would be part of the argument on behalf of Mr Luton that up until that time there had to be a judicial determination because there were rights and obligations between the two parties and that the argument is that the Commonwealth cannot therefore say, "We are going to have an administrative officer, part of the Executive, making these determinations as to the rights and obligations of citizen A as against citizen B".

HIS HONOUR: I do not have a copy of the Act. I have asked my associate to go to get one. When the Registrar receives an application for an administrative assessment, does he or she give notice of that to the person who would be liable?

MR CORR: Yes, I believe - my friend has been so kind as to - I believe it is in section 30 of the Act. There does not appear to be in there a requirement to notify the person that the Registrar must assess. Yes, 34. That is upon acceptance, notice is to be given that it has been accepted.

HIS HONOUR: Notice has to be given?

MR CORR: Under section 34(1) of the Assessment Act:

If the Registrar accepts an application for administrative assessment of child support for a child, the Registrar must immediately notify the applicant, and the person from whom the -

It says in this:

the application sought payment of child support or the person to whom the application sought to pay child support (as the case requires), in writing.

HIS HONOUR: This was an ex nuptial child, is that right?

MR CORR: Yes, that is correct.

HIS HONOUR: How does the Family Court have jurisdiction and how does the Commonwealth agency have jurisdiction?

MR CORR: I believe there had been a reference of power from the States that enabled the Commonwealth to pass laws in relation to ex nuptial children, so that - - -

HIS HONOUR: And where does this child reside?

MR CORR: In New South Wales.

HIS HONOUR: So has there been a reference from New South Wales?

MR CORR: Yes, I believe that there was the reference from all the States in relation - - -

HIS HONOUR: All of the States. I have got the legislation, just bear with me for a moment.

MR CORR: Yes, I believe there was a reference in 1986, an Act of the New South Wales Parliament, the Commonwealth Powers (Family Law - Children) Act , which predates the child support legislation and all material matters in relation to Mr Luton, Ms Lessels and the child.

HIS HONOUR: Does there need to be registration first, under section 17?

MR CORR: Yes, in relation to what point, your Honour?

HIS HONOUR: In relation to any action that the Registrar may take to enforce as garnishee or the like.

MR CORR: Yes, I think there does definitely have to be a registration before there is any garnishee action or taking of funds from tax credits.

HIS HONOUR: Under what section does the Registrar act? You told me before. What section is the application made under? Application by a person responsible for a child for an enforcement order by a Registrar - what section does the applicant apply under?

MR CORR: My friend has kindly offered to go through the matter.

HIS HONOUR: Well, just before that happens, you want me to state a case.

MR CORR: Yes, that is correct, your Honour.

HIS HONOUR: I need to be referred to the appropriate provisions and I need to see the documents. The materials filed, it seems to me, are insufficient; I would really need to see the application, I would need to see the form of the order. Perhaps I might hear from you for a moment, Mr Horan.

MR HORAN: Your Honour, I just propose maybe to say something briefly about how the broad scheme - - -

HIS HONOUR: I think I understand how broadly it works and I think I understand the purpose of it, to ensure that people who are the parents or are responsible for children take responsibility for them by paying for their maintenance, and a Commonwealth agency has been established to bring about that, if possible. I understand that. But it is correct, is it, that there is no order of any court, in this case, and there need not be under the legislation, is that right?

MR HORAN: There need not be, your Honour. The legislation broadly - - -

HIS HONOUR: Do not tell me about it broadly. Tell me how the Registrar's powers are triggered.

MR HORAN: The starting point under the two Acts, the Assessment Act and the Registration and Collection Act, is to make an application under the Assessment Act for the administrative assessment of child support liability, the purpose being that a parent who seeks to obtain a child support entitlement no longer needs to begin with an application to a court.

HIS HONOUR: Let us look at the actual sections, will we.

MR HORAN: The section under which the application is made is section 23 of the Assessment Act.

HIS HONOUR: Is "administrative assessment" defined? Yes, it is. It means an assessment under Part 5.

MR HORAN: What happens, your Honour, is that an application is made - - -

HIS HONOUR: No, I want to see the sections.

MR HORAN: Before your Honour gets to Part 5, we need to look at Part 4 which deals with the making of applications. On receiving an application, the Registrar has the function of deciding whether the application is properly made. That appears in section 30 of the Act which provides that:

If the Registrar is satisfied that an application has been properly made.....the Registrar must accept the application.

The question whether or not an application has been properly made is governed by Division 1 and specifically section 23 which sets out the requirements for an application and provides that:

An application for administrative assessment of child support is properly made if it complies with the following provisions -

and then refers to each of the provisions in the balance of Division 1 which set out the types of threshold requirements which the Registrar must be satisfied of, largely relating to the identity of the parent from whom child support is sought and the existence and identity of the child in respect of whom the child support is payable and so on.

HIS HONOUR: Is there a notice provision?

MR HORAN: My understanding is there is no notice provision of the making of the application for administrative assessment but there is a notice at the stage that the Registrar decides whether or not to accept the application, so that if the application - - -

HIS HONOUR: What section is that?

MR HORAN: That is sections 33 and 34, the first dealing with the notice procedures where the Registrar decides that the application was not properly made and the second dealing with notification where the Registrar decides that the application was properly made and has accordingly accepted the application.

HIS HONOUR: So, under section 34(2) the rights of the person sought to be made liable are to apply:

to a court having jurisdiction under this Act for a declaration under section 107 -

So, the person is liable unless the person applies to a court, is that right?

MR HORAN: That is right, your Honour. The application to which that notice provision refers under section 107 is primarily an application for the court to review whether or not the requirements for an entitlement to child support under the Act arise. At a subsequent stage there are rights to apply to the court for a departure from or modification of the quantum of child support that is payable, because what follows from the acceptance of the application by the Registrar is that a statutory basic formula for the calculation of the child support amount operates at a prima facie level unless an application is made either to the Registrar or to the court for a departure from that basic formula.

HIS HONOUR: Yes. At this stage I am not prepared to state a case. I want the parties to prepare written submissions setting out their contentions and the arguments that they would advance on each side. On your part, Mr Corr, the argument that you would present to urge the invalidity of the provisions with specific reference to the relevant provisions.

MR CORR: Yes, your Honour.

HIS HONOUR: On your part, Mr Horan, I would wish to see submissions as to why the legislation should be upheld. You should prepare the written submissions as if you were arguing the case and in that way I think we will have a much better definition of the issues and I can then decide whether I will state a case. I am not suggesting that there is not a point there, there does seem to be a point there, but I do not think it is clearly enough to defined yet.

MR HORAN: Yes. Might I say, your Honour, the attitude of the Registrar is not to oppose the stating of a case, but not necessarily to - - -

HIS HONOUR: That may well be so, and I understand that, but nonetheless - - -

MR HORAN: No, what I was about to say, your Honour, is not necessarily to support that course of action either, although this case being in the original jurisdiction of the court, ultimately, some means of disposition needs to be found. The application today is to state a case to the Full Court under section 18. An alternative course of action is to reserve those questions of law for consideration by a single Judge, which would possibly be a means of disposing of the substance.

HIS HONOUR: If I think that there is a case, and it looks rather likely that there is an arguable case, I would state it for the Full Court or see that the matter goes before the Full Court. What relief does the writ seek? You could probably proceed by way of application for prerogative writ, I suppose, under section 75(v) of the Constitution.

MR CORR: Yes. It was just as - - -

HIS HONOUR: That does not matter. In any event, that is what I would like you to do, to present some arguments for the better definition of the issues, which will enable me to decide finally whether I will state a case. It is likely that I will, but I would wish to be in a position better to define the issues and - - -

MR CORR: Yes, certainly, your Honour.

HIS HONOUR: - - - and to define the questions because there is nothing worse than bringing questions up to the Full Court and finding that there are constitutional facts which are either not agreed or not found.

MR CORR: It is of no benefit to anyone, your Honour, particularly not the Court.

HIS HONOUR: That is what I am concerned about. And I think the material is somewhat deficient. I think I would need to see the application, any of formal documents that have been filed and dealt with: the application to the Registrar, any responses by the Registrar and any notices given by the Registrar and a chronology would also be useful. Has it reached the stage at which the Registrar has notified the person responsible for the payments? It must have, because that is why the challenge has been brought.

MR CORR: Yes.

HIS HONOUR: But a chronology would be useful.

MR CORR: Yes, certainly, your Honour.

HIS HONOUR: Is it clear then what I have in mind?

MR CORR: Yes.

HIS HONOUR: Because what I am minded to do is to adjourn the matter and give you an opportunity to do the things I have asked for and then the matter can come back before me. Are you two gentlemen or are the three counsel from Canberra or - - -

MR CORR: Yes, we are, your Honour.

HIS HONOUR: You are. Would it be more convenient to have the matter brought back on in Canberra?

MR CORR: I think that would be easier, your Honour.

HIS HONOUR: I will make two orders.

I will order that the parties file outlines of submissions respectively challenging the validity of the legislation and urging that it be upheld, supplemented by further material, including a chronology and copies of the relevant documents filed and notices given under the legislation in question.

I will order that the matter be adjourned until 9.30. Does the morning of 14 June suit you? Is it convenient?

MR HORAN: Yes, it is suitable.

HIS HONOUR: Very well, we will make it 14 June.

I will order that the material be filed in the principal Registry in Canberra by 5 June.

That should give you sufficient time.

MR CORR: Yes, certainly.

HIS HONOUR: Nothing further then?

MR CORR: No.

MR HORAN: Could your Honour certify for costs?

HIS HONOUR: Costs of counsel?

MR HORAN: Yes.

HIS HONOUR: Yes, I will certify for costs of counsel. Yes, there is nothing further?

MR CORR: Nothing.

HIS HONOUR: Yes, thank you.

AT 9.43 AM THE MATTER WAS ADJOURNED

UNTIL WEDNESDAY, 14 JUNE 2000