By Briana Kotzapavlidis

12 February 2019

In the recent Federal Circuit Court decision of Rake, the Court was unable to set aside a Binding Child Support Agreement as the agreement had been automatically terminated by the introduction of legislation on 1 July 2018.

The father argued that exceptional circumstances had arisen since the agreement was made because the child now lived full time with him and if he was obliged to pay child support to the mother (with whom the child spends little time) as well as meeting living and education expenses for the child and the child’s older sibling, he would suffer hardship.

In the unfortunate (and arguably unintended) result, as the agreement had been terminated, it could not be set aside using the Court’s power under the Act. The father also remains liable for child support arrears, even though the agreement has been terminated, and the Court has no power to stay the father’s wages being garnished to collect those arrears.

The Court acknowledged that, “whist it seems unfair that the applicant is required to pay child support for a child in his full time care, when parties enter into a binding agreement they are contracting out of the administrative child support system.” They do so, “knowing what their obligations are regardless of a change in fortunes of one or both parties for better or worse.”

This case highlights that although it is intended to be a straightforward and user friendly system, child support can be incredibly difficult to navigate. The complexity of the legislation is out of kilter with its purpose and objectives; permitting parents to make private arrangements and ensuring that both parents abide their primary duty to provide proper and adequate financial support for their children according to their respective financial capacities to do so.

 

For more information or clarification please contact Briana Kotzapavlidis or a member of our Family Law Team.

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