Stay of Cancellation of Child Care Benefit Approval: Galaxy Day Care Pty Ltd v Secretary, Commonwealth Department of Education and Training

This case concerns a Federal Court of Australia case that heard an application from Galaxy Day Care to stay (i.e. put on hold) the cancellation by the Department of its approval as a provider of child care services under section 195H(1)(b), A New Tax System (Family Assistance)(Administration) Act 1999 (Cth). The Department cancelled the approval on the basis of family day care educators caring for more children than they were permitted to and overpayment of CCB which had not been repaid. The applicant (Galaxy) applied for an internal review under the Act of the cancellation decision on 10 October 2018. However, the cancellation was to come into effect on 15 October, consequently the applicant applied for a stay of the decision on a number of grounds. 

The court agreed to stay the decision until the internal review was conducted because the applicant had an arguable case:

In my view, the appropriate order to make is a stay of the cancellation decision for a period which recognises the fact that internal review is being sought.

It is worth observing that it is in the applicant’s interests to provide any further information sought by the Department in the context of internal review expeditiously. The length of time for which a stay is sought is obviously relevant to whether a further stay should be granted or the present stay extended.

I was informed that the Department has requested submissions from the applicant in respect of the internal review by 19 October 2018. I was told by the solicitor appearing for the respondent that the usual timeframe for internal review to be completed was four to six weeks, although it was possible that expedition could be sought in particular cases, and, as I understood it, expedition would be sought in this case. I was told that often a majority of that period of four to six weeks was taken up, effectively, in waiting for material to be provided by the person seeking internal review.

In light of that information, and on the basis of the undertaking as to damages given by the applicant through its counsel, it is appropriate that the decision of the delegate of the respondent taken on 2 October 2018 to cancel the applicant’s provider approval be stayed until 10.15 am on 22 November 2018.