Aston & Haymon
[2021] FamCAFC 146
•9 August 2021
FAMILY COURT OF AUSTRALIA
Aston & Haymon [2021] FamCAFC 146
Appeal from: Aston & Haymon [2020] FCCA 3112 Appeal number(s): NOA 90 of 2020 File number(s): TVC 650 of 2018 Judgment of: TREE J Date of judgment: 9 August 2021 Catchwords: FAMILY LAW – APPEAL – PROPERTY – Where the appellant challenges inclusion of various loans said to relate to the respondent’s legal fees into the property pool – Where the primary judge acknowledged legal fees should be excluded but could not be satisfied on the evidence which amounts related to legal fees – Where the appellant failed to cross-examine a witness as to the loans – Where the appellant is bound by the conduct of her case at trial – Where there was a sufficient evidentiary basis for the primary judge’s finding to include the loans – Where appeals are not opportunities to remedy evidentiary oversights or revisit poor forensic decisions at trial – Appeal dismissed – Appellant to pay the respondent’s costs in a fixed sum. Legislation: Family Law Act 1975 (Cth) ss 79, 117
Family Law Rules 2004 (Cth) r 19.34(1)
Cases cited: Browne v Dunn (1983) 6 R 67
House v The King (1936) 55 CLR 499; [1936] HCA 40
LC v TC (1998) FLC 92-803; [1998] FamCA 47
Metwally v University of Wollongong (1958) 60 ALR 68; [1985] HCA 28
Division: Appeal Division Number of paragraphs: 41 Date of hearing: 3 August 2021 Place: Heard in Cairns, delivered in Townsville Counsel for the Appellant: Mr Jones (direct brief) Counsel for the Respondent: Mr Cameron Solicitor for the Respondent: Alex Mackay & Co ORDERS
NOA 90 of 2020
TVC 650 of 2018APPEAL DIVISION OF THE FAMILY COURT OF AUSTRALIA
BETWEEN: MS ASTON
Appellant
AND: MR HAYMON
Respondent
ORDER MADE BY:
TREE J
DATE OF ORDER:
9 AUGUST 2021
THE COURT ORDERS THAT:
1.The appellant’s Application in an Appeal filed 30 July 2021 be dismissed.
2.The appeal be dismissed.
3.The appellant pay the respondent’s costs in the sum of $8,000 within 60 days.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Aston & Haymon has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
TREE J:
INTRODUCTION
On 26 November 2020, the primary judge made orders under s 79 of the Family Law Act 1975 (Cth) (“the Act”) effecting the division of the parties’ property. Pursuant to those orders, the appellant wife received 50 per cent of the net pool of non-superannuation assets, and each party retained their superannuation, which saw the appellant take about 75 per cent of the superannuation pool. The equal property division was achieved by the appellant retaining the assets in her sole possession or name, being paid the net proceeds of sale of some livestock (including monies from an earlier sale which was held in trust) and the respondent husband making a further payment to her of $120,000.
From those orders the appellant now appeals. For the reasons which follow, the appeal fails.
BACKGROUND
The parties commenced cohabitation in October 2010, when the appellant was aged 30 and the respondent 39. They married in 2015 and separated on a final basis in September 2017, meaning that the relationship subsisted for a little less than seven years. No children were born to the relationship.
During the relationship, the parties mainly lived on rural properties where, in addition to pursuing their respective occupations of finance professional and tradesman, they undertook some farming activities.
The appellant commenced property settlement proceedings in 2018. The trial initially ran for two days in May 2019, and later for another day in June 2019, but was then unable to be concluded, which saw submissions heard in December 2019, with judgment being reserved.
THE APPELLANT’S APPLICATION TO ADDUCE FURTHER EVIDENCE
By her Application in an Appeal filed 30 July 2021, the appellant sought to rely upon two affidavits deposed by the respondent, and filed by his solicitors on 2 August and 24 September 2018. They were not relied upon by the respondent at the trial before the primary judge, nor were they read into evidence by the appellant.
In the course of argument, counsel for the appellant ceased to press the application. It will be dismissed.
THE APPEAL
At the outset, it is useful to restate the relevant principles which govern appeals from discretionary judgments. Particularly, it is well settled that error of the type identified in House v The King (1936) 55 CLR 499 at 504–505 must be established. There, the majority of the High Court said:
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.
Ground 1
This ground asserts:
[The primary judge] erred by accepting evidence that the post-separation loans made to the respondent and included these loans in their entirety into the property pool despite the stated purpose for some of these loans being for payment of legal expenses, fines and penalties and court ordered costs.
At [28] of the primary judge’s reasons, her Honour dealt with the relevant loans as follows:
28. The husband asserts that there are loans from his parents which need to be included in the matrimonial pool. There is an amount of $200,000 which he says was loaned during the marriage. There is an amount of $177,800 when he says was loaned post-separation. The husband’s father deposed in an affidavit filed 3 May 2019 to loans paid at those times. He was not cross-examined about any of these matters although he was required for cross-examination. The fact that he alone deposed to matters which his wife may also have been able to speak to does not lessen his own evidence. His evidence about matters to do with loans and gifts is unchallenged and must be accepted by the Court. I accept the loans are real and must be included in the pool. Any amounts within the loans which were for legal fees or expenses should not be included in the pool, but I am unable to tell from the husband’s father’s evidence which amounts are strictly legal costs and so the amounts in their entirety will need to go in.
Accordingly her Honour included all the loans as extant liabilities in the pool of assets and liabilities.
The loans totalling $200,000 do not in any respect relate to legal fees, rather it is the loans totalling $177,800 which are the focus of this ground. The latter amount is made up of a variety of items, which need to separately be considered. However before doing so, it must be said that the error contended by this ground does not reflect any submission advanced by the appellant before the primary judge. Rather, her contention advanced in her written submissions filed 16 December 2019 was that “[t]here is no evidence whatsoever before the Court to support the validity of the alleged loans” (at paragraph 17.n.i) and the “claims of amounts owed must be rejected” (at paragraph 17.n.v).
After receiving the primary judge’s reasons, it appears that the appellant latched on to her Honour’s statement at [28] that loans which were for legal fees and expenses should not be included in the pool, and now, for the first time, seeks to argue that some of the loans within the $177,800 should be so characterised. However unless there are exceptional circumstances, a party is bound by their conduct of their case at trial (Metwally v University of Wollongong (1958) 60 ALR 68 (“Metwally”) at 71). There are no exceptional circumstances here, and for that reason alone this ground must fail.
However, in any event, the new argument lacks merit. In her summary of argument the appellant contends that the primary judge erred by including loans in a total of $75,806.87 in the liabilities which, on the respondent’s father’s evidence, were in relation to the respondent’s legal fees or the like. First, she contends that paragraph 130(d) of the respondent’s father’s affidavit filed 3 May 2019, identifies that loans totalling $48,665.80 were said to be in relation to legal expenses of the respondent. Next she relies on a further loan of $8,777.69 (by reference to paragraph 125 of the respondent’s father’s affidavit) which is said to be referrable to the respondent’s legal bills, and further, an additional loan of $12,417.68 (referred to in Table C at paragraph 118 of the respondent’s father’s affidavit), the purpose of which is unclear.
It is often accepted that legal fees attributable to the property proceedings should not be included as liabilities in determining the net property pool, given that to do so would see the other party bearing some responsibility for them, contrary to the usual rule established under s 117 of the Act. Logically, the same reasoning would apply to loans used to pay such bills.
However it is clear that the sum of $48,665.80 includes costs referable to proceedings other than the property litigation, or are ambiguous, or silent as to what legal proceedings they relate to. Thus $13,810 is specifically said to relate to the parties’ domestic violence proceedings in the Magistrates Court, and $6,999.99 is unspecified. Whilst a single payment of $26,315.81 is said to be “relating to property matters” and $1,540 for a valuation – perhaps associated with the property proceedings – there is still room for doubt.
As to the sum of $8,777.69, the respondent’s father’s affidavit does not specify as to whether it related to fees in the property proceedings or not, and it is not clear what the purpose of the loan of $12,417.68 was. It would not have been open to her Honour to infer that they were referrable to the property litigation, absent a sufficient evidentiary basis for doing so.
Further, again because the appellant was apparently unaware of the justification for the exclusion of legal costs from the balance sheet in property proceedings, in relation to the loans of $177,800, she now also seeks to have excluded from the property pool about $3,600 loaned by the respondent’s father to the respondent to pay fines which have been imposed upon the respondent by state authorities, and $2,311 loaned by the respondent’s father in order for the respondent to meet his obligations to the Australian Taxation Office. There is no warrant for excluding them from the table of liabilities.
In his summary of argument, the respondent contends primarily that the factual findings made by the primary judge in [28] were reasonably open to her on the evidence, and not being glaringly improbable or contrary to compelling inferences, cannot now be disturbed. That much is self-evidently correct.
Absent any argument at trial that the loans for legal fees incurred in the property proceedings should be excluded on that basis, it was not incumbent upon the primary judge to speculate on what of those fees were referable to the property proceedings, nor to arbitrarily apportion them.
Further, by only raising this contention for the first time on appeal, the appellant denied the respondent the opportunity to lead evidence in relation to the proper characterisation of the loans, and deprived him of the opportunity to try to persuade the primary judge that in the exercise of her discretion, such loans as may be referrable to payment of legal fees incurred in the proceedings should nonetheless be included in the balance sheet.
Ground 1 is not made out, and fails.
Ground 2
Ground 2 asserts as follows:
[The primary judge] erred by accepting evidence from a witness which had not been challenged by a self-represented applicant in circumstances where it was clear the applicant was challenging the witness’ evidence.
This challenge again arises from [28] of the primary judge’s reasons, which has been recited earlier, and particularly her Honour’s acceptance of the evidence of the respondent’s father. However on this occasion the appellant’s argument focusses upon the sentence “[h]is evidence about matters to do with loans and gifts is unchallenged and must be accepted by the Court”.
I have already broadly discussed what the $177,800 loans comprised, however the $200,000 amount comprised two loans of $150,000 and $50,000, as sworn to in the respondent’s father’s affidavit at paragraph 130. He was not cross-examined by the appellant by reference to either sum, or indeed about any loaned monies at all. The appellant, who self-represented before the primary judge claims in her summary of argument at paragraph 22 that “a more robust cross examination was negated by the inability of the [r]espondent’s father to provide any independent documents evidences [sic] the existence of the $210,000 loan”. However that latter loan is quite different to the $150,000 loan, the $50,000 loan or indeed the $177,800 loan, and how the lack of documentary evidence as to the $210,000 loan “negated” the need to challenge the evidence as to the $150,000 and $50,000 loans, or any other loan for that matter, is quite unclear.
It cannot seriously be contended that the appellant was unaware of her entitlement to cross-examine the respondent’s father, as not only did she briefly do so, but she had previously extensively cross-examined the respondent himself. Rather, it appears she likely made a forensic decision not to cross-examine the respondent’s father based upon the absence of any bank statement supporting another, unrelated loan.
The appellant relies upon the Full Court decision of LC v TC (1998) FLC 92-803 (“LC v TC”) at [38]–[39] to justify her failure to relevantly cross-examine the respondent’s father, on the basis that the so-called rule in Browne v Dunn (1983) 6 R 67 did not apply to the proceedings, because they were conducted with evidence-in-chief being on affidavit. That much is incontestable.
However the appellant seeks to then elevate that into the proposition that the primary judge erred in law by accepting the respondent’s father’s evidence, which although challenged by the appellant’s evidence, had not been the subject of cross-examination. Such a suggestion must be rejected. LC v TC is authority for the proposition that counsel do not need to put all contrary contentions to a witness, if the witness is sufficiently on notice of them, not that a judge must then reject that witness’ evidence. Yet that is precisely what this ground contends, namely, that by accepting the evidence, the primary judge erred in law. In any event, given the evidence of the respondent’s father as to the loans, it cannot be said that there was an insufficient evidentiary basis for the primary judge’s finding that the loans were real and, inferentially, repayable.
Much of the foregoing also applies to the loans totalling $177,800, substantial components of which I have already traversed in discussing Ground 1. However as to all components, again no cross-examination of the respondent’s father was undertaken in relation to any of them. There was necessarily therefore a sufficient evidentiary basis for the primary judge’s finding that the loans were liabilities of the respondent which ought be included in the balance sheet.
No error is established in relation to Ground 2 and it fails.
Ground 3
Ground 3 provides as follows:
[The primary judge] erred by failing to make any orders in relation to the second set of funds held in the trust account of [the respondent’s solicitor] which are currently held on behalf of the respondent and the [appellant] from the sale proceeds of livestock.
This ground of appeal is a little difficult to understand, however a convenient starting point is to acknowledge that the primary judge included in the non-contentious pool of assets and liabilities, “proceeds of sale of livestock” in the sum of $4,166.66. These comprised monies which, pursuant to orders of the primary judge made on 26 September 2018, were held in the respondent’s solicitor’s trust account. The monies were sourced from the net proceeds of sale of some livestock by the respondent.
However on 16 October 2019, after evidence in the trial had closed, but before submissions, the primary judge made a somewhat similar order, albeit in respect of a sum of $12,542.96, which was conditioned as “pending the provision of sale of the livestock”. Whatever happened to that money is unclear, but if it remained in the solicitor’s trust account, it seems plain that neither party sought to re-open the evidence to include this sum, and indeed it appears as though both parties and the court thereafter ignored it. Certainly it appears clear that neither party contended that it should be recognised as an asset, whether as agreed or disputed, in their proffered balance sheets.
The only thing after 16 October 2019 that the evidence discloses occurred referrable to the $12,542.96, was that on 16 December 2019 – the day before oral submissions were made – the appellant amended the orders which she sought in her outline of case, to delete reference to the $4,166.66 being paid to her, and instead referring to “all sums” held in the respondent’s solicitor’s trust account.
But the confusion is only increased by the fact that amongst the agreed items in the parties’ balance sheet, was an amount of $5,600 in respect of livestock. This was the value attributed to them by a single expert. It is unclear whether the $12,542.96 is referrable to the sale of those livestock, or some other livestock not previously identified. Either way, given that on 26 November 2020, the primary judge ordered the sale of the livestock worth $5,600, and that the proceeds be paid to the appellant, either she already had the benefit of an entitlement to the $12,542.96, or she needed to have applied prior to judgment to re-open the trial to lead evidence that the livestock which had been sold for $12,542.96 were additional property of the parties that should be included in the pool. Not only did she fail to do so, but more, she made no reference to the $12,542.96 in her written submissions also filed 16 December 2019.
As I have already noted, parties are generally bound by their conduct of the case at trial (Metwally). Appeals are not opportunities to remedy evidentiary oversights or revisit poor forensic decisions by the parties in the conduct of their cases at trial.
This ground is without merit and must fail.
CONCLUSION
No ground of appeal succeeds, and the appeal must be dismissed.
COSTS
In the event that the appeal failed, the respondent sought that the appellant pay his costs totalling $26,843.56. Although the schedule claiming that sum was calculated at scale, it plainly claimed many solicitor/client items, for instance, no less than 30 hours of counsel’s time in preparing the appeal. How that much time was reasonably necessary for the attainment of justice, and proportionate to the issues in the case – the formula established by r 19.34(1) of the Family Law Rules 2004 (Cth) for determining whether items are legitimately a party/party cost – in relation to a three ground, single judge appeal, without any appeal books, is unclear. That is not to say such work might not unreasonably be undertaken as between a lawyer and their client, as work which a prudent litigant might undertake, but that is the test for solicitor/client, not party/party, costs.
The same comments apply with equal force to a number of items in the respondent’s solicitors’ claimed fees.
Whilst counsel for the appellant conceded that there should be an order for costs in the event the appeal was dismissed, he contended that an appropriate figure was $7,000. I am inclined to be a little more generous to the respondent, and indeed I assess them in the sum of $8,000. They should be payable within 60 days of the date of these orders.
I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Tree. Associate:
Dated: 9 August 2021
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