5.6.3: Reapplying for collection

Context

A payee can apply for collection to resume after CSA has stopped enforcing a registered maintenance liability.

Legislative references

Sections 39 and 39A Child Support (Registration and Collection) Act 1988

Regulation 5C Child Support (Registration and Collection) Regulations 1988

Explanation

If CSA ends collection because the payer had a satisfactory payment record, or because the payee elected to end CSA collection, the payee can later reapply for CSA collection (section 39). The payee can make their application in writing, by telephone, in person, or electronically by completing a form on the CSA's website www.csa.gov.au (section 39(2)). The payee can also apply for CSA to collect arrears for them (section 39A(4)).

A payee cannot make an application for collection to resume during a low-income non-enforcement period (section 39(3)).

Unlike an application for registration, CSA is not obliged to accept the payee's application for collection to resume. CSA can grant or refuse the payee's application and must do so within 28 days of receiving it (section 39(4)).

CSA must grant the application if (section 39(5)):

• the payer has an unsatisfactory payment record, or
• there are special circumstances in the case that make it appropriate for CSA to collect the amounts

CSA will refuse the application in other circumstances.

If CSA accepts the payee's application it must vary the Register by specifying a date that the liability again becomes enforceable, which can't be more than 60 days after CSA received the application for collection (section 39(6)). Nor can it be a day included in a low-income non-enforcement period (section 39(7)).

CSA will usually determine that the liability is first enforceable from the date it received the payee's application for collection to resume. It may sometimes be appropriate to make the liability enforceable from a later day, for example if the payee has already received payments that cover a period after that date.

If the payee made their application by lodging a form at a Centrelink or Family Assistance office, CSA will accept this as the date that it received the payee's application.

When CSA accepts a payee's application to resume collection, CSA can also collect unpaid amounts for specified arrears period.

Unsatisfactory payment record

Except in particular circumstances, a payer has an unsatisfactory payment record if they did not pay the maintenance liability when it was due (regulation 5C(1)). In determining whether there is an unsatisfactory payment record CSA will examine the evidence provided by both parties such as bank statements, automatic transfer of payments, cheque butts and written statements.

A payment will not be considered late if the payer has made a payment of a kind prescribed in regulation 5D that would be credited against the ongoing liability if the case was registered for collection and the payment was sufficient to meet the liability (section 39A(8)). The payer must have paid 70% of the ongoing liability directly to the payee by the date it was due. CSA will give both parties the opportunity to make statements and provide evidence about whether the payments have been made.

The payer will not have an unsatisfactory payment record if they made any payment late because of circumstances outside of the payer's control. The payment must have been made as soon as possible (regulation 5C(2)). Examples of where a payment is late because of circumstances outside of his or her control may include:

• bank errors, employer errors or postal delays;
• failure to receive notification of the requirement to pay directly to the payee;
• failure to understand the notification because of poor English language skills or illiteracy;
• the payee failed to provide details to enable the payer to make payments direct to him or her;
• a serious illness or accident of the payer or someone close to them prevented the payer from making the payment;
• natural disasters meant that the payment could not be made.

The payer will not have an unsatisfactory payment record if the payment was late because of circumstances within the payer's control and the payer has taken some action to ensure that this does not happen again. The payer must have made the payment as soon as possible (regulation 5C(2)). This may occur when:

• a payer is mistaken as to the date the payment is due and payable (due dates may be different when the case is privately collected);
• arrears arise because of a retrospective change to the liability and the payer has complied with an agreement with the payee to pay off those arrears over time. The payee is entitled to payment on due dates and may request payment of all arrears at any time despite such an agreement. However, if the payer has been paying arrears as agreed with the payee and makes full payment at the request of the payee then they will not have an unsatisfactory payment record;
• personal trauma causing severe stress or hardship (such as a death in the payer's family or a natural disaster that damages a payer's home) may diminish the relative importance of meeting their maintenance obligation. If a payment is late in these circumstances the payer will not have an unsatisfactory payment record, particularly if they make arrangements for automatic transfer of the maintenance liability for the future from a bank account or from their employer;
• the payer forgot to make a payment and has made arrangements so that this does not happen again. This will usually mean that the payer arranged for automatic transfer of the maintenance liability from their bank or employer; or
• the payer made a payment by cheque that was later dishonoured and has made arrangements so that this does not happen again. This will usually mean that the payer has arranged for automatic transfer of amounts owing from their bank or employer.

Special circumstances that make CSA collection appropriate

CSA will accept the application even though the payer has a satisfactory payment record if there are special circumstances in the case which make CSA collection appropriate (section 39(5)(b)). CSA collection may be appropriate if there are difficulties in the relationship between the parents or between the payer and the children that may make private collection difficult to sustain.

When the payee applies for CSA collection they should supply the reason they believe their circumstances are special such that their application for CSA collection should not be refused. CSA will give the payer an opportunity to comment on the reason the payee has given for their application for CSA collection. CSA will then make a decision based on the information and evidence provided by both parties.

Collection of arrears if CSA accepts payee's application for collection to resume

A payee who applies for collection to resume can also apply for CSA to collect arrears for them (section 39A(4)). If CSA accepts the payee's election for collection to resume, it must also accept their application for collection of amounts the payer has not paid in the three months immediately before the date the liability first becomes enforceable by CSA. CSA will need to be satisfied that the amounts have actually not been paid.

A payee may also apply for collection of amounts unpaid by the payer for nine months before the liability first becomes enforceable by CSA. This is called the maximum arrears period. If there are amounts unpaid for this period and CSA is satisfied that there are exceptional circumstances it must grant the application.

If CSA grants the payee's application the unpaid amounts become a child support debt and CSA will vary the Register to show that the payer owes these unpaid amounts.

Exceptional circumstances

Whether circumstances are exceptional will depend on the facts in each particular case. The circumstances must be somehow unusual. They may be circumstances beyond the control of the payee that prevented them from applying for collection within a reasonable period. CSA will consider the effect of the particular circumstances on the payee and the extent to which those circumstances contributed to the payee's delay in re-applying for collection.

The following are examples of circumstances that CSA may consider exceptional. This is not an exhaustive list and each case must be considered on its merits.

• The payer threatened or pressured the payee not to apply for registration for CSA collection (See Chapter 6.10 Family violence).
• The payee was ill or had an accident that stopped them for applying for collection.
• The payee suffered a personal trauma such as a death in the family or a natural disaster that caused damage to the payee's property.
• The payee had communication difficulties because of including isolation, illiteracy or poor English language skills.
• The payer created a false expectation of payment (e.g. they promised to pay a lump sum from the proceeds of the sale of property or a compensation settlement).
• The parents were involved in negotiations over child support and/or other matters and applying for collection may have compromised those negotiations.

In some cases payees may apply for collection after CSA amends a child support assessment retrospectively so that there are significant arrears arising (for example, it may replace a default income or reconcile an estimate of income). These arrears arise through the ordinary operation of the Act and are not an exceptional circumstance even if the payee was unaware of any change in the payer's circumstances.

Evidence to show exceptional circumstances

The payee must provide suitable evidence for CSA to find there are exceptional circumstances. For example, if the payee states that the payer threatened or pressured them they may provide evidence from a person fully aware of the nature and details of the circumstances such as a doctor, social welfare worker or police officer.

In the case of illness, accident or psychiatric condition, the payee should provide written confirmation from a medical practitioner. In other cases, the payee must supply a full and detailed explanation supported by appropriate evidence.

CSA must provide the payer with an opportunity to comment on information the payee provided to CSA if it is taking it into account to make a decision to grant an application for a maximum arrears period.

Calculating amounts unpaid

In some cases parents provide conflicting information about payments made during the relevant arrears period. CSA will make reasonable investigations, including interviewing customers (by phone or in person) to find details of any payment dates and amounts. It will also take into account any evidence of amounts transferred from the payer to the payee, such as bank records or receipts signed by the payee. It may also decide whether amounts paid during the period were paid for periods in advance or in arrears.

For CSA to make the decision to collect child support arrears CSA has to be satisfied that the amount was unpaid. To do this it will examine the evidence provided by both parties in relation to the payment. If there is no evidence of payment then CSA cannot be satisfied the disputed amount was paid. The disputed amount will be included in CSA's calculation as an unpaid amount.

CSA will take into account any amounts that the payer has previously paid that would qualify as a prescribed non-agency payment (See Chapter 5.3 Non-agency payments and offsetting liabilities) when calculating the amounts unpaid. If the payer has paid 70% of the liability directly to the payee, CSA will credit towards the remaining 30% of the liability any further amounts that would qualify as prescribed non-agency payments.

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Version 1.3

Issued 3 August 2007

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