FEDERAL MAGISTRATES COURT OF AUSTRALIA
BAGLEY & BAGLEY (SSAT APPEAL)	[2010] FMCAfam 215	

CHILD SUPPORT – Application for an extension of time to appeal from a decision of the Social Security Appeals Tribunal – extension of time granted – consideration of the appeal – father deriving income from a company – Tribunal setting the father’s child support income at a much higher amount than would be derived from his taxable income. 	

Child Support (Assessment) Act 1989, ss.4,117
Child Support (Registration and Collection) Act 1988, ss.103C, 103X, 110B, 110K
Federal Magistrates Court Rules 2001, rr.3, 25A	

Apthorpe v Repatriation Commission (1987) 13 ALD 656
Child Support Registrar v Bagley (2008) FMCAfam 1456
Collector of Customs v Pressure Tankers Pty Ltd and Pozzolanic Enterprises
Pty Ltd [1993] FCA 322
Gallo v Dawson (1990) 64 ALJR 458
LDME & JMA [2007] FMCAfam 712
Tasman & Tisdell (SSAT Appeal) [2008] FMCAfam 126
Tyagi & Meares (SSAT Appeal) [2008] FMCAfam 886	

Applicant:	MR BAGLEY	

Respondent:	MS BAGLEY	

File Number:	DNC 143 of 2008	

Judgment of:	Terry FM	

Hearing date:	16 October 2009	

Date of Last Submission:	16 October 2009	

Delivered at:	Newcastle	

Delivered on:	23 March 2010	

REPRESENTATION
The Applicant:	In person	

Counsel for the Respondents:	Ms Orwin	

Solicitors for the Respondents:	Margaret Orwin & Associates	

ORDERS
(1)	That the applicant is granted an extension of time to file an appeal against the decision of the Social Security Appeals Tribunal delivered on 29 February 2008.
(2)	That the appeal is dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Bagley& Bagley (SSAT Appeal) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
DARWIN	
DNC 143 of 2008
MR BAGLEY	
Applicant

And

MS BAGLEY	
First Respondent

REASONS FOR JUDGMENT
Introduction
1.	Mr Bagley wishes to appeal against a decision of the Social Security Appeals Tribunal made on 29 February 2008. 
2.	The Tribunal set the father’s child support income at $110,179.25 per annum for the period 11 January 2007 to 31 December 2008.  It was the father’s case that this decision should be set aside and that his child support liability for this period should be assessed on the basis of his taxable income, which was $17,707.00 for the 2006 financial year, $29,225.00 for the 2007 financial year and $26,287.00 for the 2008 financial year.
3.	The father’s appeal was filed twelve months out of time, and he seeks an extension of time in which to file the appeal. 
4.	Ms Bagley opposes the father being given an extension of time and opposes the appeal. 
5.	The parties agreed that the application for an extension of time, and the appeal, should be listed for hearing together.
The events leading up the current applications
6.	The mother and father have one child, [X], who is now 15. The father has for many years been assessed to pay child support for [X].
7.	The father works in the building industry and derives his income from a company, [B], of which he is the sole director and shareholder.
8.	The father’s taxable income was high for several years proceeding 2005 and his taxable income for the 2005 financial year was $90,838.00.  For the period 7 February 2006 to 31 October 2006 he was assessed to pay child support of $1,160.66 per month.   
9.	From 1 November 2006 however the father was administratively assessed to pay child support of $98.42 per month.  This assessment was based on his 2006 taxable income of $20,545.00 and the mother’s 2006 taxable income of $12,705.00.
10.	On 11 January 2007 the mother applied for a change of assessment. Her application was successful and a senior case officer set the father’s child support income at $90,000.00 per annum for the period 15 February 2007 (the date the decision was handed down) to 
31 January 2008. As a result the father was assessed to pay child support of $13,683.00 per annum or $1,140.25 per month. 
11.	The father unsuccessfully objected to this decision, and he then appealed to the Social Security Appeals Tribunal for a review of the decision. 
12.	The Tribunal conducted a hearing on 16 January 2008, with the Tribunal members sitting in Brisbane and the mother, father and the father’s accountant taking part by telephone from Darwin. The father and mother were given liberty/requested to provide further documents prior to the Tribunal handing down its decision and both did so. 
13.	The Tribunal handed down its decision on 29 February 2008, to the effect that it varied the decision under review and set the father’s child support income at $110,179.25 per annum for the period 
11 January 2007 to 31 December 2008.
14.	On 4 April 2008 the father filed an appeal against this decision in the Federal Magistrates Court at Darwin. However he discontinued this appeal on 13 June 2008 by filing a Notice of Discontinuance.
15.	By this time the father owed considerable arrears of child support, and on 25 September 2008 the Child Support Registrar commenced enforcement proceedings. In December 2008 a hearing was conducted and the father was ordered to pay $37,110.52 to the Child Support Registrar by 31 March 2009. 
16.	It was further ordered that if the father failed to pay, the Child Support Registrar was at liberty to sell a property owned by the father at Property H.
17.	The father filed an appeal against these orders in the Family Court of Australia. His grounds of appeal were effectively complaints, not about the enforcement decision, but about the Social Security Appeals Tribunal decision. One of his grounds of appeal for example was that “the Social Security Appeals Tribunal…unlawfully went behind the Taxation Assessment Act to unlawfully derive an unlawful higher amount than prescribed by the Child Support Legislation and the facts of Mr Bagley’s Australian Taxation Audited Income.” 
18.	In April 2009 the father discontinued his Family Court appeal and filed again in this court an appeal against the Social Security Appeals Tribunal decision, together with an application for leave to file the appeal out of time. 
19.	The father also contemporaneously applied for a stay of the enforcement orders. The parties to that application were the father and the Child Support Registrar. The Child Support Registrar did not oppose the stay application and a stay order was made.
20.	In due course the father’s application for leave to file the appeal out of time, and his appeal, were listed for hearing on 16 October 2009.
The father’s application for an extension of time
21.	Pursuant to r.25A(06)(2) of the Federal Magistrates Court Rules a person wishing to appeal against an SSAT decision must file the appeal within 28 days of receiving a written statement of the reasons for decision under ss.103X(3) or (5) of the Child Support (Registration & Collection) Act. 
22.	The father received the Tribunal’s written decision in early March 2008 and his second appeal was filed twelve months out of time. 
23.	The father sought an extension of time in which to file the appeal. The court has the power to grant such an extension pursuant to r.3.05(1) of the Federal Magistrates Court Rules which provides that:
“The Court may extend or shorten a time fixed by these rules….”
24.	Whether an extension of time should be granted is within the discretion of the court. In the High Court case of Gallo v Dawson  McHugh J said as follows:
“The discretion to extend time is given for the sole purpose of    enabling the court to do justice between the parties…..
	This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time….”
25.	The father did not, at first glance, make out a compelling case for the discretion being exercised in his favour. In the extremely brief affidavit he filed in support of his application for an extension of time, he said only that he had been “persuaded by a non-legal friend” to withdraw his original appeal in 2008 but now wished to pursue it. During submissions on 16 October 2009 the father simply asserted that the decision was so obviously wrong that he should be given an opportunity to challenge it.  
26.	The father’s Notice of Appeal was amended several times. The grounds of appeal on which he relied at the hearing were contained in the amended Notice of Appeal filed on 17 August 2009 and were as follows:
a)	No qualifying case facts existed in the application for an administrative change of assessment by Ms Bagley under Child Support legislation for CSA to change away from the legislated taxable income and formulae calculated amount already being paid by Mr Bagley.
b)	CSA did not espouse any and then “tampered” with the taxable income of Mr Bagley and were wrong in law creating Mr Bagley an unaffordable overcharge of child support payments.
c)	SSAT did not properly review the CSA case according to child support and its own legislation as a “review of CSA methodology” to reveal this flaw and was an action by the SSAT fundamentally wrong in law in the role of the SSAT.
d)	SSAT further did not make like comparisons of same circumstances to treat both parents fairly and equitably and was an action by SSAT wrong in law.
e)	 SSAT did not mention finding any qualification in 
Ms Bagley’s application or a failure of Mr Bagley’s tax returns s.56, s.34A, s.43 or work patterns under s.117. SSAT like CSA simply tampered with Mr Bagley’s taxable income that was wrong in law and has no law of enforcement to have to earn four times his s.56 taxable income.
f)	 SSAT further did not apply the same false hypothesis equitably to similarly self-employed Ms Bagley obviously understating her income to both CSA and SSAT.
27.	These grounds of appeal are not helpfully drafted and are very vague and general and nothing leaps out as suggesting that the Tribunal might have made an error of law. A cursory inspection of the Tribunal’s decision suggests that in conducting its review it followed the legislative pathway through s.117 of the Child Support (Assessment) Act and undertook a detailed analysis of the father’s and mother’s financial positions before arriving at a decision.
28.	A further matter of concern is that the father filed the appeal for the second time only after the enforcement orders were made, giving rise to a question of whether he might have filed the appeal simply as a delaying tactic. 
29.	Despite all the above matters however, three things incline me to grant the father an extension of time, subject to a consideration of the hardship which such an outcome might cause for the mother. 
30.	Firstly, it is abundantly clear that the father has always been genuinely aggrieved about the 2008 decision. He tried to impeach the decision during the enforcement hearing in December 2008, and when he filed his Notice of Appeal in the Family Court it was the Social Security Appeals Tribunal decision he complained about, not the enforcement decision. 
31.	There is evidence to suggest that the father was under the mistaken belief (perhaps induced by bad advice from a friend) that he could effectively challenge the Tribunal’s decision by raising complaints about it during the enforcement process, and it is reasonable to infer that it was because of this belief, rather than because of any lack of faith in the merits of his appeal, that he discontinued his appeal the first time.
32.	Secondly, while the father’s grounds of appeal are not helpfully drawn, he was not legally represented when his amended Notice of Appeal was filed and in Tasman & Tisdell (SSAT Appeal) Brown FM said about this situation as follows:
	“…. bearing in mind that the applicant is unrepresented, I should not take “an unduly legalistic or pedantic approach [to] analysing the grounds of appeal” which he has provided.  Rather I should examine the material overall and attempt to identify whether some question of law arises which may justify the making of the orders sought on appeal.  Regardless of failures of form in the appeal documentation, I should attempt to come to grips with the real substance of the appeal and, subject to the requirements of procedural fairness, deal with it.” 
33.	Without the kind of scrutiny which would occur if a full hearing of the appeal was conducted I cannot completely dismiss the possibility that the appeal has merit. One of the father’s complaints in his Notice of Appeal for example is that the decision left him with an “unaffordable overcharge of child support payments.” This could be construed as a complaint that the Tribunal did not properly consider whether it was just and equitable to vary the administrative assessment, and appeals have succeeded for this reason in the past.
34.	Thirdly, the result for the father if the SSAT decision stands is that the stay on the enforcement orders will be lifted and the father may, if he cannot pay the outstanding debt immediately, lose his home. In the face of such a severe possible consequence the father deserves an opportunity, if it can be given without the mother suffering undue hardship, to challenge the Tribunal’s decision.
35.	The mother was not able to point to any particular detriment she would suffer if the father was given leave to proceed with the appeal. She has not for example received money which she might have to pay back to the father if the appeal is successful. 
36.	As the Child Support Registrar consented to a stay of the enforcement orders pending the hearing of the appeal, and as the mother’s solicitor could not point to any particular detriment the mother would suffer if an extension of time was granted, in my view the interests of justice require the father being given an opportunity to argue his appeal. 
The Social Security Appeals Tribunal’s decision
37.	Pursuant to s.110K of the Child Support (Registration and Collection) Act the Tribunal provided the Court with copies of the documents which were before it. The father supplied a transcript of the proceedings on 16 January 2008.  
38.	In its decision the Tribunal identified the issues it needed to determine as follows:
a)	whether one or more of the grounds for departure had been established;  and if so 
b)	whether it was:
i)	just and equitable as regards [X], Mr Bagley and 
Ms Bagley; and 
ii)	otherwise proper,
to depart from the administrative assessment.
39.	The Tribunal identified the potential grounds for departure as being firstly that the assessment did not take into account the income, property and financial resources of the parents (s.117(2)(c)(ia) of the Assessment Act) and secondly that the assessment did not take into account their earning capacity (s.117(2)(c)(ib) of the Assessment Act).
40.	Under the heading “Assessment of Evidence and Findings” the Tribunal then made a series of very detailed findings about the expenses claimed by [B] for the 2006 financial year which went to reduce its income. They found that:
i)	$13,936.00 of the depreciation expenses in 2006 represented a personal benefit to the father, namely depreciation expenses attributable to a Porsche motor vehicle, a Ducati motor bike, a DVD player and a small portion of the depreciation expenses attributable to a ute;
ii)	$1,131.20 of an interest expense incurred with BMW finance in respect of the Ducati motor bike was a personal benefit to the father;
iii)	$92.45 or 5% of the telephone expense was a personal benefit to the father;
iv)	$1,184.40 of the expenses claimed in relation to the ute and $4,511.20 of the expenses claimed in relation to the motor bike were for the personal benefit of the father;
v)	an amount of $2,900.00 (out of a total amount of $11,000.00 paid to a superannuation fund for the father) was a voluntary superannuation contribution by the father which should not take precedence over his child support obligations;
vi)	a claim of $5,200.00 for home office and storage was admitted by the father’s accountant to be a notional expense not a cash expense.
41.	The Tribunal were satisfied that when the total of these amounts ($28,955.25) was added to the $60,424.00 trading profit of the company and the $20,800.00 wages paid to the father, “$110,179.25 was a reasonable estimate of the actual 2005/6 income of [the father].”
42.	The Tribunal next considered the financial situation of the company for the 2007 financial year.  
43.	The father had been directed at a pre-hearing conference to provide to the Tribunal for use at the hearing a profit and loss statement and balance sheet for [B] for the 2007 financial year if they were available. He did not provide these documents and indeed it was suggested by the father’s accountant Mr F during the hearing that such documents were not usually prepared for [B].
44.	The father did produce the BAS statements for the first two quarters of the 2007 financial year but he did not produce the BAS statements for the quarters ending 31 March 2007 and 30 June 2007. 
45.	When questioned about [B]’s 2007 income at the hearing the father was evasive. The following exchange occurred between the father and Mr Gillespie, one of the Tribunal members:
Mr Gillespie:	..how much money did [B] make last year?
Mr Bagley:	You’d have to ask Mr F that. I’ve got no idea.
Mr Gillespie:		As I understand from Mr F, from what he said before, he doesn’t know, because you haven’t provided him with the last two quarters of BAS statements.
Mr Bagley:		Well, if he hasn’t got the information obviously he can’t tell you either. I’m just making ends meet.
Mr Gillespie:		There’s only two people in this equation who are going to know the answer to that question, you and Mr F. Mr F says he can’t answer it because you haven’t given him the information, so I’m asking you. How much money did you make last financial year?
Mr Bagley:		I-I- no, I can’t answer that. I’ve got no calculator with me, no documents with me. I would have to go through all the invoices that people paid me and all the invoices I paid and do a lot of arithmetic and that’s what I pay Mr F to do.
Mr Gillespie:	Okay. Well what about gross turnover. You would have a feel for that wouldn’t you, the total amount that came in?
Mr Bagley:	If Mr F knows. I haven’t added anything up.
Mr Gillespie:	Well Mr F says he doesn’t know because you haven’t told him.
46.	The father was given an opportunity to send further documents to the Tribunal after the hearing on 16 January 2008 and in February 2008 he sent in a draft tax return for himself and for the company for the 2007 financial year. The companies’ tax return indicated that [B] had paid the father a director’s fee of $26,000.00, and had itself made a loss of $19,194.00.
47.	The Tribunal made the following findings about the expenses claimed by the company for the 2007 financial year:
i)	$3,060.80 of the depreciation expenses represented a personal benefit to the father namely 10% of the depreciation expenses for the ute, 80% of the depreciation expenses for the Ducati motor bike, and the depreciation expenses for the quad bike and the DVD player;
ii)	80% or $228.00 of the interest expenses claimed for the bike represented a personal benefit to the father;
iii)	5% or $41.70 of the telephone expenses represented a personal benefit for the father;
iv)	10% or $1,390.40 of the expenses claimed for  the ute represented a personal benefit for the father;
v)	the home office and storage expense of $5,200.00 represented a notional expense not a cash expense.
48.	Adding the total of $9,920.90 to the company’s loss reduced the loss to $9,273.10 and had no impact on the father’s taxable income.
49.	The Tribunal then noted however that the company had similar gross revenue in 2006 and 2007, and that the change in the company’s situation from a profit of $60,000.00 in 2006 to a loss of $19,000.00 in 2007 appeared to be on account of a major increase in expenses for accounting (up $5,903.00) freight and delivery (up $5,669.00) insurance (up $3,088.00) interest “Adelaide Bank ATO loan” (up $15,033.00) materials and supplies (up $49,062.00 or 41.5% although the gross revenue remained the same) repairs and maintenance (up $4,429.00) and subcontractor’s expenses (up $29,772.00 or 15.8%).
50.	No evidence was provided by the father to explain these cost increases, and the Tribunal then made the following findings: 
i)	that the father had an actual income in 2006 far in excess of his taxable income;
ii)	that while the Tribunal did not have sufficient evidence before it to make an accurate finding about the father’s 2007 income, “given the consistency of revenue position of [B] and the unexplained and substantial increases in some of the costs, the Tribunal feels confident that the 2005/6 child support amount is an appropriate figure for the Tribunal to use for the duration of its decision.”
51.	The Tribunal was satisfied that a ground for departure pursuant to s.117(2)(c)(ia) had been established in respect of the father’s income.
52.	The Tribunal was not satisfied that the father had an income earning capacity which he was declining to exercise and were not satisfied that a ground for departure pursuant to s.117(2)(c)(ib) had been established.
53.	The Tribunal then made findings about the mother’s income. They were satisfied that her income was accurately reflected in her tax returns and were not satisfied that a ground for departure pursuant to s.117(2)(c)(ia) had been established in respect of the mother’s income.  
54.	After satisfying themselves that a ground for departure existed, the Tribunal considered whether it was “just and equitable as regards the child, the carer entitled to child support and the liable parent and otherwise proper” to make a departure order.
55.	The Tribunal considered the evidence about the father’s financial affairs which was contained in his bank statements (personal and company) and credit card statements. It noted the intermingling of the father’s and [B]’s funds.  It pointed out the difficulty it faced in assessing the father’s reasonable needs because of the father’s failure to provide the necessary information to the Tribunal.
56.	The Tribunal noted that the mother had no income, and that [X] had a right to support. They concluded that it was just and equitable and otherwise proper to vary the determination of the Child Support Registrar to the effect that the father’s child support income was set at $110,179.25.
57.	The Tribunal backdated the change of assessment to 11 January 2007, the day on which the mother had filed her application and extended it to 31 December 2008. It did not explain why it back dated the change of assessment on 11 January 2007, although it is reasonable to infer that it could see no reason why the change of assessment should not commence from the date of the mother’s application, given that [X] clearly had needs at that time and the father had the capacity to pay. 
58.	The reason given by the Tribunal for varying the end date of the assessment was that by 31 December 2008 a much clearer picture of the financial position of both parties (whether [B] had in fact suffered a downturn in business and whether the mother and her new partner had reaped the rewards of their company) should be apparent. 
The principles to be applied in determining the appeal
59.	The Tribunal’s role was to inquire into the merits of the decision of the Senior Case Officer but it is not the function of this court to inquire into the merits of the decision of the Social Security Appeals Tribunal. A party may appeal to this court from a decision of the Tribunal only on a question of law. 
60.	In Collector of Customs v Pressure Tankers Pty Ltd and Pozzolanic Enterprises Pty Ltd the Full Court of the Federal Court were dealing with an appeal from a decision of the Administrative Appeals Tribunal, from which an appeal also may only be brought on a question of law,  and said as follows:
	"... the nature of the task of this court is clear. It is to leave to the tribunal of fact decisions as to the facts and to interfere only when the identified error is one of law.”
61.	In Tasman & Tisdell (SSAT Appeal), Brown FM considered what was meant by an appeal on a question of law and said as follows:
	“An administrative tribunal exceeds its powers and thus commits a jurisdictional error, which is correctable on appeal in respect of a question of law, if it:
(a)	fails to construe properly the legislative provisions applicable;
(b)	identifies the wrong issues or asks itself the wrong questions;
(c)	ignores relevant material or relies on irrelevant material;
(d)	fails to accord procedural fairness to the party before it;
(e)	makes an erroneous finding of such a magnitude that it goes to the very jurisdiction which it purports to exercise rendering its decision perverse or unreasonable or otherwise offending logic.”
The father’s grounds of appeal
62.	Taking into account the father’s grounds of appeal as drafted, and the issues which emerged during his submissions, it seems to me that the real substance of the father’s appeal was as follows:
a)	that as a matter of law the Tribunal did not have the right to set an alternative income amount for the father unless it could be proved (and it had not been) that the father had done something unlawful to arrive at that taxable income.
b)	that the Tribunal did not conduct a proper review of the senior case officer’s decision, following the steps required by s.117 of the Assessment Act, and in particular it:
i)	was unduly influenced by the fact that the father had earned a high income in the past;
ii)	failed to subject the mother’s financial situation to the same scrutiny as the father’s; and
iii)	failed to properly consider whether it was just and equitable as regards the father, the mother and [X] to vary the administrative assessment.
c)	that the Tribunal made a serious mistake of fact when it found that the father had income and financial resources of $110,179.25 at his disposal, and it made that mistake because it failed to understand that the difference between the father’s income and the company’s income.
d)	that the Tribunal failed to properly consider s.117(7B) of the Child Support (Assessment) Act and wrongly came to the  conclusion that the father had a greater income earning capacity than was revealed by his taxable income. 
e)	that the father was not accorded procedural fairness because the hearing was conducted by telephone and this put him and his accountant Mr F at a disadvantage in trying to explain financial matters to the Tribunal.
Discussion
Ground a
63.	The father submitted that the senior case officer and later the Tribunal had no right to “tamper” with his taxable income and set an alternative child support income amount which was five times greater. He submitted that the law required that he be assessed on the basis of his taxable income, unless it could be shown that he had done something unlawful to achieve this taxable income.
64.	This complaint must fail.
65.	In the normal course of events a parent’s child support income is based on his or her taxable income. However pursuant to s.118(1)(b) of the Child Support (Assessment) Act one of the orders which can be made after the hearing of a departure application is an order varying a parent’s child support income.  It is not necessary to be satisfied that the taxable income was arrived at unlawfully before such an order can be made, it is merely necessary to be satisfied that a ground for departure has been established and that it is just and equitable and otherwise proper to vary the administrative assessment.
Ground b
66.	The next issue raised was whether the Tribunal properly reviewed the decision of the senior case officer.
67.	In its decision the Tribunal correctly identified the relevant legislative provisions and conducted a very thorough assessment of the evidence before making findings about whether a ground for departure had been established and about whether it was just and equitable and otherwise proper to vary the administrative assessment.
68.	The father submitted that the senior case officer and later the Tribunal were unduly influenced by the fact that his income had been high in the past. There is nothing in the material to support this submission. No doubt the fact that the father’s income had been high in the past caused the senior case officer and the Tribunal to look carefully at his claim that his income had suddenly decreased by more than 75% in the 2006 financial year, but the Tribunal conducted an exhaustive inquiry into the father’s financial situation and made careful and detailed findings of fact and I am satisfied that it properly carried out its responsibilities to review the decision.
69.	The father also submitted that the Tribunal did not conduct the same exhaustive inquiry into the mother’s financial circumstances as it did into his. This is not supported by the material. The transcript of the hearing reveals that the Tribunal spent considerable time questioning the mother about her finances and putting to her allegations by the father that she was receiving cash money and that a company in which she was involved, [C], provided her with an income of $50,000.00 per year.
70.	The father did not help himself with exchanges such as the following:
Mr Gillespie:	Mr Bagley, I want to ask you – you said you’d heard that [[C]] was earning $50,000.00 a year. 
	Where have you heard that from?
Mr Bagley:	That’s confidential
Mr Gillespie:	Well, its going to have an awful lot more credibility if you can tell us the source of the information.
Mr Bagley:	No. I can’t tell you.
71.	The mother provided documents to the Tribunal concerning the operation of her small [bodycare] business including bank statements and credit card statements and the Tribunal was satisfied that the mother had a minimal income from this business. It was satisfied that the company in which the mother was involved with her partner (a company developing a [healthcare] treatment) was in its infancy.  
72.	There was nothing in the documents provided by the mother to suggest that her trading activities had changed from one year to the next or that her income was being reduced for taxation purposes by a large number of deductions. 
73.	In my view the Tribunal did not treat the mother and father differently. It conducted a thorough inquiry into the mother’s financial circumstances and the findings it made about the mother’s financial situation were well open to it. 
74.	During the hearing before me the father sought to introduce fresh evidence and to rely on an affidavit sworn by Mr D. Mr D claimed to have been involved in the [healthcare] business and he asserted that some relatively large cash sums had been received by the business.
75.	I did not permit the father to introduce fresh evidence and to rely on Mr D’s affidavit at the hearing of the appeal and in any event it would not have helped the father. The principal allegations in it were about the mother’s company and/or the mother and her partner Mr W receiving cash money in 2009.
76.	One of the father’s complaints in his 17 August 2009 amended notice of appeal was that the decision created an “unaffordable overcharge of child support payments” and this could be construed as a complaint that the Social Security Appeals Tribunal did not properly consider whether it was just and equitable as regards the father to vary the assessment
77.	In my view the Tribunal did their best, in difficult circumstances, to assess the father’s reasonable needs and his capacity to meet those needs. 
78.	An argument perhaps open to the father was that the Tribunal could not be said to have properly considered whether it was just and equitable as regards him to vary the assessment when it did not make any mention of the amount of child support he would be required to pay if his child support income amount was set at $110,000.00. In Tyagi & Meares such a failure was considered a basis for impugning the Tribunal’s decision.
79.	However in the present case this failure must be considered against the background that the father had previously been assessed to pay a high level of child support and the amount he was likely to be required to pay if his child support income amount was set at $110,000.00 was roughly known. 
80.	It must also be considered against the background that the mother’s income was extremely low and that the father was effectively the only person available to provide financial support for [X]. 
A requirement that the father pay child support for [X] at the maximum amount he was capable of paying cannot be regarded as being in excess of [X]’s needs.
81.	I am not persuaded that the failure by the Tribunal to specifically refer to the amount of child support the father would need to pay if his child support income was set at $110,179.25 vitiates the decision or that there is merit in any of the father’s arguments about the way the Tribunal conducted its review.
Ground c
82.	The submission that the Tribunal failed to understand the difference between the father’s income and the company’s income and therefore made a serious error of fact when it determined that he had access to $110, 179.25 must also fail.
83.	In its decision the Tribunal very carefully analysed the company’s income and expenses and identified amounts the company was paying which benefitted the father rather than the company. The Tribunal very clearly understood the difference between the father’s income and the company’s income and set out in some detail in its decision how it arrived at the income figure of $110,179.25 for the father. 
Ground d 
84.	I do not accept that the Tribunal wrongly ignored the provisions of s.117(7B) of the Assessment Act.  The Tribunal’s decision did not turn on a finding that the father had an income earning capacity he was failing to exercise, it turned on a finding that the father had income and financial resources available to him in excess of  his taxable income. 
Ground e
85.	I do not accept that the father was not accorded procedural fairness or was disadvantaged because the hearing was conducted by telephone. 
86.	There is power in s.103C of the Registration and Collection Act for submissions to be made by telephone in certain circumstances, one of which is that the parties or the parties representatives live in a remote area and that unreasonable expense would be incurred in them travelling to the place at which the hearing was conducted. 
87.	It was appropriate for the Tribunal to conduct the hearing by telephone rather than require the father, Mr F and the mother to travel to Brisbane. The father provided a transcript of the hearing and it is clear that the Tribunal went to considerable trouble to ensure that phone connections were clear and that documents were scanned and emailed to the parties so that everyone taking part had relevant documents when questions were asked. 
88.	I do not in any event accept that the Tribunal failed to understand the father’s case and that it might have come to a different decision if 
Mr F had been in the same room as it to explain the company’s accounts.
An additional issue
89.	One argument the father might have made was that the Tribunal should have given him an opportunity to explain the large cost increases incurred by the company in 2007 before making findings about the financial position of the father and the company for that year, and that in failing to do so they failed to accord him procedural fairness.
90.	Although this argument could have been raised, I am not persuaded that it would have succeeded.
91.	The father was well aware prior to the hearing on 16 January 2008 that there would be an inquiry into his and the company’s 2007 financial situation. The directions made at the pre-hearing conference required him to produce financial documents for that year, but at the hearing he produced only two out of the four BAS Statements and was evasive when questioned about the company’s 2007 income.
92.	The father subsequently sent in draft 2007 tax returns for himself and the company, but he must have been aware, as a result of the questioning during the hearing, that the Tribunal would be carefully scrutinising the company’s claims for expenses for the 2007 year. The father must have realised that the Tribunal would treat with suspicion large increases in expenses which resulted in a previously profitable company making a loss despite gross income remaining about the same.  He had the opportunity to provide an explanation when he sent in the returns. He failed to do so and in my view the Tribunal was not obliged to give him a further opportunity to explain.
93.	In all the circumstances the father’s appeal will be dismissed.
I certify that the preceding ninety-three (93) paragraphs are a true copy of the reasons for judgment of Terry FM

Date:           23 March 2010