CCS 1871 2007
| Jurisdiction | UK Non-devolved |
| Judge | Other Judges / Other Commissioners/Deputy Commissioners |
| Judgment Date | 25 January 2008 |
| Court | Upper Tribunal (Administrative Appeals Chamber) |
| Docket Number | CCS 1871 2007 |
| Subject Matter | Child support |
CCS/1871/2007
DECISION OF THE CHILD SUPPORT COMMISSIONER
The Child Support Commissioner’s decision
1. This appeal by the father to the Child Support Commissioner succeeds. The decision of the Brighton appeal tribunal sitting on 7 October 2005 is wrong in law. I must therefore set that decision aside under section 24(2) of the Child Support Act 1991.
2. I have decided to substitute my own decision under section 24(3)(a) of the 1991 Act as the one that the tribunal should have made, relying on the tribunal’s findings of facts. My substituted decision is as follows:
The mother’s appeal against the decision of 28 September 2004 regarding the basic maintenance calculation is allowed and the Secretary of State’s decision revised. The father’s formula-based net weekly income was £202.75, not £132.44. This applies to the liability from the effective date of 24 August 2004. As the father’s net weekly income exceeds £200, the basic rate of 20 per cent applies given that there were two qualifying children at that date. Arithmetically this results in a child support liability of £40.55; this is rounded to £41 per week for two children from the effective date by virtue of regulation 2(3) of the Maintenance Calculations and Special Cases Regulations 2000.
The mother’s appeal against the decision of 15 March 2005 on the variation application is dismissed. There are no grounds to agree a variation under regulations 18 and 19 of the Variations Regulations for the reasons given by the tribunal. The father’s life-style at the effective date was £1,070 per week. The formula-based income is substantially lower than this. However, the father’s life-style was funded in part by rental income and in part by drawings from the director’s loan account. The former is excluded from consideration by regulation 20(3)(a). The latter is excluded from consideration by regulation 20(3)(c). It follows that regulation 20(1) does not apply and the mother’s appeal against the refusal of the life-style variation application is dismissed.
Introduction
3. In the language of the child support legislation, the appellant is the non-resident parent under the maintenance calculation, the first respondent is the Secretary of State and the second respondent is the parent with care. For convenience, however, I shall refer to them in this decision as the father, the Secretary of State and the mother respectively. For all practical purposes the Secretary of State’s functions in relation to child support are carried out by the Child Support Agency (the CSA).
4. The CSA is at present required by legislation to operate two child support schemes in parallel. The “old scheme” is governed by the provisions of the Child Support Act 1991 (and secondary legislation) as it was before amendment by the Child Support, Pensions and Social Security Act 2000 in March 2003. This case, however, is covered by the “new scheme”, as the application for child support was made after that date. It is therefore covered by the 1991 Act as amended by the 2000 Act and the regulations made under those provisions. The “new scheme” formula is much less complicated than its old scheme predecessor. In particular, the new scheme applies a much narrower definition of “income”. As will be seen, this difference has important implications for the present appeal.
5. The father now appeals against the decision of the Brighton appeal tribunal on 7 October 2005. The issue concerns the assessment of the father’s child support liability as at August 2004 for his younger son, born on 16 August 1988 (and so who was then aged 16, now 19), and his daughter born on 21 June 1992 (and so who was then aged 12, now 15).
6. This appeal was the subject of an oral hearing on 22 January 2008, held at the Asylum and Immigration Tribunal venue in London (because of building works at the Commissioners’ offices). The father attended the oral hearing, represented by his solicitor, Mr Fryer. The Secretary of State was represented by Mr Scoon of the Office of the Solicitor to the Department for Work and Pensions. The mother had indicated in correspondence that she would not be attending the hearing. Although she was not present, I have considered her written submissions carefully. Moreover, this is an inquisitorial and not an adversarial jurisdiction, so I have considered all the points that might conceivably be taken whether or not they have been raised by any of the parties. I am grateful to all parties for their assistance.
The background to the present appeal
7. The breakdown of the parents’ marriage appears to have been accompanied by some acrimony and the financial arrangements have been the cause of further tension. There is a voluminous file of papers for this appeal. For the purposes of the present appeal I will confine myself to the issues particularly relevant to these proceedings.
8. The parents married in 1992. The father is a graphic designer and runs his own business through a company of which he is a director (his brother is the company accountant). The mother has an NVQ qualification in the field of finance. There are three children (only the younger two are relevant for present purposes). The parents separated in March 2002 and the mother petitioned for divorce in May 2002; the father cross-petitioned in August 2002. The decree absolute was issued on the father’s petition in January 2003.
9. In February 2003 an FDR hearing was held in Brighton county court. The father agreed to pay £250 a month in maintenance for each of the three children pending the final hearing. A final hearing was held in July 2003 at the county court. As part of this process the parties exchanged standard form financial statements in the normal way. Those Form Es are on file in this appeal. It is evident on any reckoning that the parties led a comfortable middle-class life-style.
10. A copy of the July 2003 county court consent order is also on file (docs 108-110). The consent order dealt with a range of property adjustment, capital and income matters that do not need to be rehearsed here. However, as part of that order, the father undertook (undertaking 5):
“To pay maintenance for the children at the rate of £250 per calendar month per child for the parties’ two youngest children as from 13 August 2003 until completion of the CSA assessment in relation to the said children and commencement of payment of the sums due under the said assessment.”
11. It may be that the mother thought any CSA assessment would be “there or thereabouts” the figure of £250 per child per month. We do not know. But if that was her impression, subsequent events were to dash that expectation.
12. The history thereafter is a little murky as regards compliance with the terms of that consent order. According to the mother, the father paid the aggregate sum of £500 a month for some months but she then applied to the magistrates’ court due to his poor payment record and in April 2004 he was ordered to pay £500 a month into court as from 1 February 2004 (doc 107). According to the father, the magistrates accepted that he was not in arrears and dismissed the mother’s case (doc 111). The letter from the magistrates’ court dated 19 April 2004 (doc 131) suggests that the mother’s account of the outcome of those proceedings is the more accurate one.
The CSA’s maintenance calculation
13. Whatever happened, a little over a year after the consent order had been made the father made an application to the CSA, which was received by the Agency on 24 August 2004 (docs 17-25). He stated that he was employed as a company director on a monthly salary of £1,086.25 (equivalent to £13,035 a year).
14. The CSA then processed the father’s application (docs 27-33). This was done promptly with a maintenance calculation being issued on 28 September 2004. The effective date was identified as 24 August 2004 and the relevant week as the week ending 23 August 2004. However, based on the father’s modest declared earnings as a company director on the CSA application form, the outcome was a maintenance calculation in the sum of just £16 a week for both children together (see docs 99-101). This amounts to a figure of around £69 (rather than £500) a calendar month.
15. Unsurprisingly, and doubtless with a degree of understatement, a CSA file-note of a telephone conversation on 30 September 2004 records the mother as being “not happy” about the level of this assessment and about the consent order being ignored (doc 32). The officer who took the call “explained about variations ref his dividends”. The officer also spoke to the father the same day, mentioning that the mother might apply for a variation on this basis. The father’s response was that “the divs have been kept low to improve the business”.
The CSA’s ...
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