Recovery of debts by customers in court (CS) 277-04310000

A customer must advise Services Australia of their intention to enforce a collectable child support or overpayment debt. A customer’s court application must include evidence they have notified the agency.

The agency must be notified in writing (letter or facsimile are suitable). Generally, the agency should be notified at least 14 days prior to the filing of the court application. However, the court may allow a shorter timeframe or for the notification to take place after the application is filed.

The written notification of the customer’s intention to legally enforce a debt must be uploaded to the customer’s View Correspondence window. This ensures the information is readily available to staff. See Correspondence received in Child Support.

All customer enforcement cases must be managed by Debt Enforcement in Intensive Collection Services.

• Create a Client Transfer Request intray
• Type in the intray notepad subject line:
• For child support debts - 'Recovery of debt by payee' ,
• For overpayment debts - 'Recovery of debt by payer'
• See Intray management Cuba Process Help
• Route the intray to:

Region: NEW SOUTH WALES AND ACT

Office: PARRAMATTA OFFICE

Stream/Team: SLI2 DE PAR 02

Position: Z - LITIGATION REFERRAL

When the written notification of a customer's intention to take enforcement proceedings is received the Debt Enforcement Gateway Officer (GO) will:

• review the transfer request to ensure the case has been correctly referred
• lock the customer taking enforcement action to the following position:
• Region: NEW SOUTH WALES AND ACT
  Office: PARRAMATTA OFFICE
  Stream/Team: SLI2 DE PAR 02
  Position: Z - PYE ENFORCEMENT
• in special contact details in Cuba, record:
• for child support debts - 'PYE ENFORCEMENT'
• for overpayment debts - ‘PYR ENFORCEMENT’
• email case details to the PSM and request that the PSM update the 'Recovery of Debts by Customers Register' to include the payee's CSID, name and date the notification of intent was received
• Program Support Manager (PSM) to liaise with Leadership to allocate case to a Service Officer in Debt Enforcement

Advise the Debt Enforcement PSM if there are any urgent concerns identified, for example customer enforcement has been initiated on a case where the Registrar has already commenced enforcement proceedings or where the Registrar has already obtained court orders for the debt.

Note: if the notice of intent is verbal, the GO should review the Child Support Register to confirm the customer has been informed that the notice of intent must be provided in writing.

• If the customer has been informed, the in-tray can be finalised and the matter not locked to the above position as it will be referred back when written notice received
• If the customer has not been informed, the GO will make contact attempts to inform of this requirement. The outcome of the call will determine whether the matter will be locked to the above position

Further advice should be sought from the PSM if required

• For child support debts:

When written notification is received of a payee’s intention to legally enforce the debt, record in the Payer Collection window.

Record details of the customer enforcement by selecting:

• File and New or the New icon
• Level 3 from the Category menu
• Payee Enforcement in the Action menu
• Go

This will go to the Details window.

If there is debt on more than 1 case, select the customer who has commenced the action from the drop down menu.

Record the date of notification and any relevant information. For additional information, see Documenting Child Support information.

• For overpayment debts:

When written notification is received of a payer’s intention to legally enforce the debt, record a notepad in the Payer Communication window.

Record the date of notification and any relevant information. For additional information, see Documenting Child Support information.

Debt Enforcement must review the debt to ensure it is accurate.

Consider:

• the basis of the assessment
• the incomes used in the assessment for all relevant parties
• the use of estimates of income. If an estimate reconciliation is required refer to the Specialised Assessments Team for action, see the Customer referral guidelines for Child Support staff, Estimates.
• the use of all Amended Taxable incomes since 1 July 2008 to ensure they are in line with the revised amended taxable income policy. If not, an error correction submission needs to be completed and emailed to a Service Support Officer (SSO) for review

Ensure all relevant collection options have been investigated and appropriate administrative enforcement actions taken.

The Debt Enforcement PSM will make an initial decision on whether the case may be suitable for debt enforcement action. Because the customer and the Child Support Registrar cannot take court action for the same debt, at this point there may need to be discussion with the customer about their intentions.

If the customer has already filed their application with the court, see Step 3 in Table 2.

Contact the customer:

• Confirm the notice of their intention to initiate court proceedings has been received by the agency and remind the customer that a sealed copy of the court application and all subsequent court orders must be provided to the agency
• establish their reasons for taking court action, for example inaction/delay, new information, hope that action will prompt payment , and if the customer has not sought legal advice suggest that this is an option they should consider
• ask what orders/enforcement action they will be seeking from the court. Advise that where possible the agency will implement any court orders which impact on the assessment but will not enforce orders obtained if the customer who owes the debt fails to comply
• advise that while they are taking enforcement action, the agency is not prevented from continuing or commencing administrative collection action. Therefore, it is essential that open communication occurs to ensure collection action undertaken by either party is not jeopardised
• advise that because the debt may change, they should contact the agency prior to any court date or settlement to confirm the current amount of the debt. It is also important that they notify the agency of any changes to care, income and non-agency payment (NAP) throughout the process
• advise that both the assessment and the debt may change in the future as a result of updated information or review of the assessment, that is by a change of assessment or objection, and any changes to the assessment will be confirmed to them in writing
• advise of any relevant action taken, or about to be taken, to collect or correct the debt. This will allow the customer to make an informed decision on whether to continue their court action. Do not discuss the advantages and disadvantages of their court action or discuss if they should continue

Document the discussion with the customer in accordance with Documenting Child Support information.

Once a customer has notified the agency of their intention to take enforcement action, the agency must issue:

• a letter to confirm that the agency has received notification, see Resources
• a certificate of debt

The Certificate of debt issued by the agency for the purpose of Customer Enforcement proceeding. This certificate includes the amount owing to the customer who has initiated the proceedings.

Note: only SO5 debt enforcement officers can issue the certificate of debt notice as this requires the manual generation of these certificates with the affixing of a facsimile of the Child Support Registrar’s signature.

The Certificate of debt does not include any other amounts owed by the customer:

• to any other customer or case
• for any late payment penalties, consolidated revenue, costs or fines

If a customer requests a certificate of debt, find out if the customer:

• wants to go to court to collect a debt
• create an intray and refer the customer to Debt Enforcement, go to Step 3
• wants to provide the notice to an authority
• If the case is Child Support collect, send the last assessment notice and a transaction statement
• If the case is private collect, send the last assessment notice

The case will remain locked to a Service Officer until the Customer Enforcement is finalised.

Inform the customer of debt collection and correction

While the customer is taking action to legally enforce collectable debt, the agency must keep them informed of any action taken to correct or collect the debt. The case must be monitored and the customer kept informed. The information to be provided may include the details of:

• debt correction
• any payment arrangements made with the customer who owes the debt
• any successful administrative action which may include s72A notices, Employer Withholdings, Tax Refund Intercept Payments etc.
• lodgement of a proof of debt if the customer is an undischarged bankrupt

Note: do not provide personal information about the customer who owes the debt or third parties such as employer names when advising the customer of any correction/collection action. See the Child Support Guide 6.3.3: Secrecy provisions.

The applicant customer can file a court application for enforcement of the debt. The agency is not a party to the enforcement proceedings brought by the applicant customer. The parties are the payee and payer of the relevant case. There is no time limit for the applicant customer (after giving the agency at least 14 days' notice) to file an enforcement summons application to the court.

If court documents are received which list the Child Support Registrar as a party to the proceedings, escalate the case to the Debt Enforcement PSM for their review. They may recommend to the delegate the removal of the Registrar as a party.

When the application is made to the court, and a copy of the application received by the agency, the customer who owes the debt should be locked to a Service Officer.

When the agency receives a copy of the customer’s court application, document the court date and other relevant information in the Payer Collection window, See Documenting Child Support information.

Review the case details to ensure they are up to date. The case must remain locked to a Service Officer within Debt Enforcement until the customer enforcement action is complete.

Update the Recovery of Debts by Customers Register with:

• the date on which the customer’s court application was made
• the court reference, and
• the court date on the application

When a sealed copy of the court application is received:

• send an email to:
• Debt Enforcement PSM, including a recommendation for or against the agency intervening in the proceedings. Debt Enforcement PSM will liaise with Litigation and Information Release (LIR) Branch via email
• copy into the email:
• Program Advice to seek comments from the Child Support Program Branch, and
• Service Manager (copy into all communication)

Generally, the agency will only consider intervening if the customer owes a debt on more than 1 case and there is an indication that there is a viable collection opportunity. This will ensure that the court considers the customer's total debt and that any resulting court order on this debt assists with child support collection on all relevant cases.

Note: when the agency intervenes in a customer enforcement proceeding, the agency becomes liable for our costs and may be subject to costs orders.

Once approval to intervene has been received, the Litigation and Information Release Branch (LIR) will instruct an external legal service provider. The case will be allocated to a Debt Enforcement Service Officer in the relevant litigation team.

The Debt Enforcement Service Officer will email the GO requesting the Recovery of Debt by Customers Register be updated. From this point on, the case will be managed in line with the Taking a Child Support customer to court procedure.

If a decision is made not to intervene or take over enforcement proceedings, the case will remain locked to a Debt Enforcement Service Officer for ongoing management.

Contact both customers by phone to discuss the case and any actions the agency have taken or will take in relation to legal action. Also advise both customers of the current debt and ongoing liability. Inform them they will need to contact the agency prior to any court dates or settlements to confirm if the debt has changed.

Advise the customers that where possible, the agency will provide any documentation they require for the court action, at their request. For example, assessment letters, notes or transaction statements.

The agency is still bound by privacy and secrecy provisions and even in response to a subpoena, the agency may not be able to provide all documentation they request. Refer customers to the Child Support Guide 6.4.1: Subpoenas and notices to produce documents for further information and see Handling subpoenas and Commonwealth Information Location Orders served on the agency.

Advise the customers that the agency will not attend the hearing unless:

• the agency wishes to intervene in the proceeding, or
• the court requires the agency to attend

Also advise that where possible the agency will implement any court orders which impact on the assessment but will not enforce orders obtained by the applicant customer if the customer who owes the debt fails to comply.

Note: until the customer is served with the copy of the applicant’s court application, the agency cannot discuss or advise the customer who owes the debt of the proposed enforcement action. Therefore, the Service Officer should contact the applicant customer in the first instance to confirm if service has been effected on the respondent customer.

Document all contact in Payer Collection window, see Documenting Child Support information in Cuba.

It is important that the Registrar is not perceived to be assisting the applicant customer in private enforcement proceedings.

The court has broad powers to make orders for payment and enforcement of a debt. The type of order made will be influenced by a customer's individual circumstances. The court also has the power to make an order for costs against the Registrar but only if the agency is a party to the proceedings.

The applicant customer will need to take the appropriate actions to implement any enforcement provisions of the court order. If the debtor defaults on the terms of the orders, the applicant customer will need to commence enforcement proceedings through the court.

The applicant customer who is taking the enforcement action must notify the agency of any orders made by the court within 14 days of the order being made. Notice may be provided to the agency in writing (including facsimile) or verbally.

The agency must receive a sealed copy of the new court order before any action can be taken.

When the order is received update the Customer Enforcement record on the Payer Collection window in Cuba to record the date of finalisation of the court proceeding and any relevant additional information.

In the Result field select:

• successful – the customer obtained court orders for payment
• unsuccessful - the customer did not obtain court orders for payment
• withdrawn – the application was withdrawn

Update the Recovery of Debt by Customers Register with the outcome of the enforcement action, that is successful, unsuccessful or withdrawn, and the date the court order was made.

Upload the sealed copy of the court orders to the customer’s View Correspondence window.

Any payments ordered by the court, in relation to a child support debt, must be made directly to the agency.

If a customer pays their debt to the agency in accordance with the order, the agency must disperse to the person named in the order.

The general apportionment process does not apply.

To ensure that these funds are not apportioned, if a debtor owes debt to more than 1 person, when a copy of the sealed court orders are received place a hold on the account and then manually disburse the funds once received.

Note: the manual allocation of funds subject to Customer Enforcement orders where there are multiple cases, must be approved by the PSM.

If the debt is subject to court orders the Service Officer must consult their Team Leader before taking any administrative enforcement action.

If the applicant customer obtains an order that covers both collect and non-collect periods, the agency will only credit payments made for the collect period.

If the terms of the court orders have been met or have expired and the case meets the CMA finalisation guidelines, finalise the matter. See Customer referral guidelines for Child Support staff.