Are child support agreements set in stone?
A child support agreement formalises the terms upon which parties have agreed to provide financial support for their child or children into the future. The parties may reach agreement for child support to be paid periodically at set rate and/or for payments to be made directly to a third party, including to meet school fees, expenses such as books, uniforms and computers, the costs of extra-curricular activities and private health insurance premiums and/or out of pocket medical expenses.
Parties can enter into a Limited Child Support Agreement (say for a few years) or a Binding Child Support Agreement, which usually operates until each child turns 18 or completes his or secondary education. But what if circumstances change and one party wants to set the agreement aside?
The grounds upon which a Child Support Agreement can be set aside are limited. A party might assert that the agreement should be set aside because of the conduct of the other party, for example, on the grounds of fraud, material non-disclosure, undue influence or duress. In the case of a Limited Child Support Agreement, the party seeking to set the agreement aside might assert that special circumstances have arisen since the agreement was entered into (in relation to one of the parties or the child / children) and it would be unjust not to set the agreement aside.
The test in relation to Binding Child Support Agreements is more challenging. The Court must be satisfied that exceptional circumstances have arisen since the agreement was made and that either the applicant or child / children would suffer hardship if the agreement is not set aside. The Court will look at the whole of the circumstances and consider whether, they are unusual, out of the ordinary or special.
The High Court most recently noted that, “to be exceptional a circumstance need not be unique or unprecedented or very rare; but it cannot be one that is regularly, or routinely or normally encountered.” In that case, there had been a “radical change in the child’s care arrangements” as a result of which the mother’s time with the child had “steeply declined” (from 65% care to 2%). This change satisfied the test of exceptional circumstances. If the agreement was not set aside, the father would have to continue paying more than $220 per week to the mother despite having the full time care of the child. Although the High Court accepted that this may be “unjust” and “unfair”, having regard to the father’s income and assets the Court was not satisfied that the father would suffer hardship if the agreement was not set aside. In the result, the father had an ongoing child support obligation and owed the mother arrears of more than $30,000.
In other recent case examples, the Court has held that:-
- a parent’s decision not to re-engage in paid employment after being made redundant in order to have full time caring responsibility for the children of their new marriage, did not constitute exceptional circumstances;
- a parent’s inability to earn an income during a period of imprisonment was found to constitute exceptional circumstances;
- a period of unemployment is not unforeseeable and does not, of itself, constitute an exceptional circumstances. However, if a parent has held a single job for many years, is made redundant and then unable to secure new employment at a similar rate of pay, that might constitute exceptional circumstances;
- the fact of a move to another country with much higher living costs and significant costs of travel to spend time with the children was out of the ordinary and exceptional.
If you would like to know more about Child Support Agreements or if have questions about your child support rights and obligations, please do not hesitate to contact a member of the Family Law Team.
