DGW v HMW and Anor
IN THE FAMILY COURT AT WARKWORTH
Under “Child Support Act 1991”
M Green for the Appellant
A G Stuart for the First Respondent
RESERVED DECISION OF Judge D A Burns
[WITH RESPECT TO APPEAL UNDER PART 6A OF THE CHILD SUPPORT ACT 1991CHILD SUPPORT ACT 1991 FROM A DECISION OF A REVIEW OFFICER FOLLOWING AN ADMINISTRATIVE REVIEW]
The appellant (“husband”) was born on 16 February 1965 and is accordingly 45. He is New Zealand European in heritage and is an airline pilot. He currently resides in North Shore City. The respondent (“wife”) was born on 28 February 1965 and is also therefore 45. She is New Zealand European. She describes herself as a full-time mother having day-to-day care of the three children of the parties' marriage. She recently started a business. They were married on 8 April 2000 and separated in June 2007. The three boys are currently aged 9, 7 and 5.
There are proceedings in the Family Court under the Property (Relationships) Act. There also have been proceedings under the Family Proceedings Act 1980 in relation to spousal maintenance.
Following separation the wife received a Domestic Purposes Benefit and as a result a formula assessment occurred under the Child Support Act 1991 (“the Act”) and the husband was required to pay child support.
Pursuant to the annual review the husband was assessed to pay child support for the period 1 April 2009 until 31 March 2010 at $16,488.00 per annum which was based on the following formula:
Less living allowance
Multiplied by % rate
Annual child support rate
The wife was dissatisfied with that assessment and applied for a review of the child support assessment. She contended and relied on ground 8 which is “by virtue of special circumstances the assessment results in an unjust and inequitable amount because of the income, earning capacity, property and financial resources of either parent or the child – s 105(2)(c)(i).
The application for review was lodged by her on 20 March 2009 and the hearing of the review took place on 28 April 2009. The review officer reserved her decision which was delivered on 13 May 2009.
The wife contended before the review officer that she was the custodial parent of the three children. She argued that the child support assessment (as then) did not take into account the increased income and earning capacity of the husband. She said he was a First Officer for a 747–400. His base salary would be $159,000. She stated to the review officer that the husband had not paid his spousal maintenance since February 2009 and that he did not attend the last Court date in relation to that. She stated that the property (being the former home of the parties) has had to undergo a mortgagee sale and that she and the children were now required to vacate that property and obtain another home.
The husband acknowledged that he was the non-custodial parent. He did not appear at the hearing before the review officer having advised her that he would not be coming. She did receive a number of e-mails from him which stated that he expected to be assessed on his annual salary which exceeds the maximum cap. He indicated in one e-mail that his estimated annual salary is $170,000 and not $80,152.80 as in the assessment.
Following receipt of the outcome of the review hearing the husband instructed his solicitors to file an appeal against the determination relying on Part 6A. His appeal was dated 25 June 2009 and is in time. In addition to the notice of appeal he filed a without notice application for suspension of liability. He supported his notice of appeal and application for suspension by two affidavits: one sworn on 25 June 2009 and the other on 19 June 2009. The notice of appeal joined the Commissioner of Inland Revenue as a second respondent but the Commissioner has taken no formal steps and as I understand will abide by the decision of the Court. Following service of the appeal a notice of defence was filed by the wife's solicitors on 28 July 2009. She supported that notice of defence by an affidavit on 28 July 2009. She also applied on a without notice basis for an order rescinding the suspension order that had been made. The without notice application for a suspension order was dealt with by the Court and a suspension order was made on 26 June 2009. The application to rescind was dealt with by a Judge in Chambers on 30 July 2009 and the Judge ordered as follows:
Suspension order varied – liability suspended as to any amount in excess of $2000 per month pending the hearing and final determination of appeal proceedings against the Commissioner's decision. Costs reserved.
The case was set down for hearing before me. I received written submissions from both counsel. Both counsel sought to cross-examine the parties and accordingly their affidavits were confirmed. Both were cross-examined and produced exhibits.
The review officer set out the legal requirements which she said were as follows:
Before making a departure from the formula assessment for child support she must be satisfied of three legal requirements: firstly, the facts must satisfy the requirements of the ground applied under and there must be special circumstances. Special circumstances, as defined in the case of , are facts peculiar to the particular case, which set the case apart from others so as to be out of the ordinary or unusual. Secondly, she must be satisfied that it is just and equitable as between the parties to make a departure taking into account the matters set out in s 105(4) of the Act. These include the income, assets and financial resources of the parties, their financial commitments, the meeting of the proper needs of the children, whether any hardship might be caused to either party or the child and the fact that the primary duties to maintain the child rests with their parents. In addition, she said she must consider the objects of the Act as set out in s 4. Finally, she said that she must consider whether the making of the departure is otherwise proper taking into account the facts of the case, the objects of the Act and the interests of the individuals who may be affected by the outcome of examination.
The review officer set out more specifically ground 8 and said:
This ground requires a finding by virtue of special circumstances, the assessment results in an unjust and inequitable amount of financial support because of the income, earning capacity, property and, financial resources of either parent or the child.
The review officer set out the following factual grounds asserted by the wife in support of ground 8.
• The child support assessment does not take into account increased income and earning capacity of the husband.
• An Air New Zealand First Officer on a 747–400 has a base salary of at least $159,000.
• The husband has not paid spousal maintenance since February and the Court has adjourned that issue to June.
• The family home (which was heavily mortgaged) has gone under mortgagee sale and she and the children have been required to vacate the home. It will cost her between $500 and $550 to rent a place in the same area.
The e-mails sent by the husband were ambiguous. He said to the review officer that he was aware that his income is significantly higher than the maximum and indicated that he was happy to pay on his income. At the hearing before me he asserted that what he meant by that statement was that he was prepared to pay up to the maximum ceiling level and considered it fair that he be assessed at the maximum ceiling level but did not consider it appropriate that the assessment be set at the higher figure of $159,000. He said that he did not attend the hearing because he had other commitments to his work and was not available.
The review officer recorded that the wife stated to her that the husband had not paid his spousal maintenance since February 2009 and that she was very concerned as to how she will house herself and the children. She sought a good level of child support and was aware that this may affect the spousal maintenance situation but feels more secure with a significant award of child support. She said to the review officer that she was in a very difficult situation with the home having been sold by a mortgagee sale. She said there was no equity and in fact there is probably around $300,000 owing after the sale. She said that she had been asked to vacate quickly and she is very concerned to ensure that she can rent a place so that the children can remain in their school. She further said she had no access to any property or funds. The review officer referred to the case of where the Judge stated that:...
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