Badawi & Badawi - [2017] FamCAFC 129

FAMILY COURT OF AUSTRALIA

BADAWI & BADAWI

[2017] FamCAFC 129

FAMILY LAW – APPEAL – PROPERTY – Consent orders – Appeal against the primary judge’s dismissal of an application under s 79A(1)(a) of the Family Law Act 1975 (Cth) to set aside consent orders – Distinction between appeals and s 79A applications – Whether the primary judge erred by failing to find the husband lacked the capacity to agree to the consent orders, that relevant evidence had been suppressed or that the husband’s legal representation was the equivalent of no representation at all – No error established – Where consideration of whether there has been a miscarriage of justice arises only if a relevant ground under s 79A(1)(a) has been established – Appeal dismissed.

Family Law Act 1975 (Cth) ss 75(2), 79(4), 79A(1)(a)
Federal Magistrates Court Rules 2001 (Cth) rr 4.03, 24.02

Delaforce v Simpson-Cook (2010) 78 NSWLR 483
Fox v Percy (2003) 214 CLR 118
Gitane & Velacruz (2008) FLC 93-371
In the Marriage of Bennett and Bennett (1991) FLC 92-191
In the Marriage of Clifton and Stuart (1991) FLC 92-194
In the Marriage of Elliot and Willcox (1996) FLC 92-687
In the Marriage of Fagan and Fagan (1985) FLC 91-607
In the Marriage of Gebert and Gebert (1990) FLC 92-137
In the Marriage of Oastler and Oastler (1993) FLC 92-390
In the Marriage of Patching and Patching (1995) FLC 92-585
In the Marriage of Prowse and Prowse (1995) FLC 92-557
In the Marriage of Rohde and Rohde (1984) FLC 91-592
Lane & Lane (2016) FLC 93-699
Metwally v University of Wollongong (1985) 60 ALR 68
Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110
State Rail Authority (NSW) v Earthline Constructions Pty Ltd (In Liq) (1999) 160 ALR 588
Water Board v Moustakas (1988) 180 CLR 491

APPELLANT:

Mr Badawi

RESPONDENT:

Ms Badawi

FILE NUMBER:

SYC

3146

2008

APPEAL NUMBER:

175

2016

DATE DELIVERED:

14 July 2017

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Bryant CJ, Aldridge & Johnston JJ

HEARING DATE:

3 May 2017

LOWER COURT JURISDICTION:

Family Court of Australia

LOWER COURT JUDGMENT DATE:

21 September 2016

LOWER COURT MNC:

[2016] FamCA 804

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Ms Reid

SOLICITOR FOR THE APPELLANT:

M Duncan & Associates

COUNSEL FOR THE RESPONDENT:

Mr Paterson

SOLICITOR FOR THE RESPONDENT:

P Williams and Company Lawyers

Orders

That the appeal be dismissed.
Any party seeking an order for the costs of the appeal is to file written submissions within 28 days with the opposing party to file any written submissions in reply within a further 28 days.
The Principal Registrar is directed to refer a copy of these reasons, the reasons of McClelland J of 21 September 2016 and a copy of the documents referred to in paragraph 88 hereof to the Legal Services Commissioner of New South Wales.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Badawi & Badawi has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

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 r 17.02 Family Law Rules 2004 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EA 175 of 2016
File Number: SYC 3146 of 2008

Mr Badawi

Appellant

And

Ms Badawi

Respondent

REASONS FOR JUDGMENT

Introduction

In this matter Mr Badawi (“the husband”) by his Case Guardian appeals against orders, made by McClelland J (“the primary judge”) on 21 September 2016, dismissing the husband’s application to set aside consent property orders made by Federal Magistrate Dunkley (“the Federal Magistrate”) (as his Honour then was) on 4 November 2009. Ms Badawi (“the wife”) opposes the appeal.
The basis of the application before the primary judge, which was made under s 79A(1)(a) of the Family Law Act1975 (Cth) (“the Act”), was that the husband lacked the mental capacity to agree to the consent orders, that the standard of the legal representation of the husband was so poor that it amounted to no representation at all and that there had been suppression of relevant evidence. Each of these contentions was rejected by the primary judge.
During the hearing of the appeal it became apparent that in addition to asserting error on the part of the primary judge, the husband also contended that the Federal Magistrate had erred because, having regard to the nature of the orders and the lack of evidence that was before him, his Honour could not have been satisfied that it was appropriate to make the consent orders. Indeed, it was submitted that the orders had been merely “rubber stamped”.
However, neither the proceedings before the primary judge nor the appeal before us was an appeal against the orders made by the Federal Magistrate on 4 November 2009.
The proceedings before the primary judge were governed by s 79A(1)(a) of the Act which provides:
79ASetting aside of orders altering property interests
(1)Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a)there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance;
…
the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
It is well established that whilst the words “any other circumstance” are not limited by the sub-clauses that precede them, they are not of unlimited width and must relate to a miscarriage of justice. “Justice” in this context means justice according to the law and the subsection is particularly directed to the integrity of the judicial process: In the Marriage of Clifton and Stuart (1991) FLC 92-194 at 78,337 (“Clifton”); In the Marriage of Gebert and Gebert (1990) FLC 92-137 at 77,935.
Applications under s 79A are distinct from appeals, which concern whether or not a judge made an error in the making of the orders that he or she made. The difference between the two was clearly stated in In the Marriage of Fagan and Fagan (1985) FLC 91-607 at 79,931 (“Fagan”):
The fields covered by sec. 79A(1)(a) and by sec. 94 are different from each other. Section 94 provides for an appeal to the Full Court which will interfere with a judgment of a single judge only where it is established that that judge fell into error. As a general rule the error must be established on the record.
Where no error appears on the part of a trial judge but there has been a miscarriage of justice by reason of some element beyond what appeared on the record or in the evidence so that the trial judge cannot have been fully aware of all the relevant circumstances, then a single judge of the Family Court may in his discretion set aside an order made at the trial.
In In the Marriage of Elliot and Willcox (1996) FLC 92-687 at 83,135-83,136 (“Elliot”) the Full Court suggested that Fagan stands for the proposition that s 79A applications and appeals are mutually exclusive remedies and accordingly cast doubt on that case. We do not agree with their Honours’ view that in Fagan the Full Court held that a pursuit of one of these remedies precluded the pursuit of the other. We do, however, agree with the proposition that pursuit of one does not preclude pursuit of the other but the basis for each remains different. In any event, in Elliot (at 83,135) the Full Court went on to say that they did not support the proposition that it was not possible to pursue both an appeal and an application under s 79A in the alternative. We consider that the fundamental proposition articulated in Fagan and quoted above is a correct statement of the law.
As can be seen from the chronology set out below, by the time the Federal Magistrate came to consider the consent orders on 4 November 2009, the only material that had been filed by either party was the wife’s financial statement, which disclosed she had assets to the value of $11,500. It did not refer to any property said to be held by the husband. At the time the consent orders were made, the Federal Magistrate did not ask for any further information from the parties. Therefore, the only material that was before him was the consent orders themselves and the wife’s financial statement.
The husband submitted that this meant that the orders were merely “rubber stamped” and that the limited material before the Federal Magistrate “rendered it impossible for [him] to have formed any opinion as to the appropriateness of the proposed orders, or whether they were just and equitable”. In other words, the submission is that the Federal Magistrate erred in making the orders on 4 November 2009. That is a matter that cannot be raised under s 79A and must be raised, if it is to be raised, in an appeal. It remains the position that up to this time no application to extend the time to appeal has been made, notwithstanding the criticism of the Federal Magistrate’s orders. Hence the husband is constrained by the choice he has made to seek orders under s 79A.
Indeed, this was not a matter that was raised directly with the primary judge. Counsel for the husband devoted some time in her Summary of Argument to arguing for leave to raise this issue for the first time on appeal in the light of authorities such as Metwally v University of Wollongong (1985) 60 ALR 68 and Water Board v Moustakas (1988) 180 CLR 491. However, such submissions miss the insurmountable difficulty that the present appeal is against the orders of the primary judge made on 21 September 2016 and not those of the Federal Magistrate made on 4 November 2009. There is, as yet, no appeal from the Federal Magistrate’s orders.
Therefore, we do not propose to deal with submissions that go beyond trying to establish an error in the primary judge’s reasons and instead seek to identify error on the part of the Federal Magistrate.

Background

In order to understand the submissions made on appeal, it is necessary to set out in some detail the events that led up to the making of the property orders on 4 November 2009.
The parties were each born in Country C. At the time of the hearing before the primary judge the husband was 65 years old and the wife was aged 53.
In 1972, having arrived in Australia the year earlier, the husband along with his mother and three of his brothers purchased a property at W Street, Suburb U (“the W Street property”) in equal shares. In September 1978 he purchased land at A Street, Suburb U (“the A Street property”), unencumbered, upon which he subsequently built a house.
In December 1984 the wife arrived in Australia. The parties met in February 1985 and married on 20 April 1985. After a short period of time living with the husband’s mother at the W Street property, the parties moved into the A Street property in July 1985. The parties had three children born between 1986 and 1996.
The parties separated on 27 March 2004 when the husband was admitted to Z Psychiatric Hospital consequent to injuries he suffered in a motor vehicle accident in 1997. Shortly thereafter in August 2004 an Apprehended Domestic Violence Order was granted against the husband, restraining him from returning to the A Street property. The order was breached by the husband on many occasions when he returned to the A Street property contrary to the terms of the order.
It was the wife’s evidence before the primary judge and the evidence of each of the three children that the relationship between the husband and the wife, and indeed the children, was marked with significant family violence and abuse.
On 21 August 2008 the wife filed an Application for a Divorce. Later that year the husband was again admitted to a psychiatric facility for a period of time.
On 17 March 2009 a decree nisi was granted and on 1 July 2009 the wife filed an application seeking final property orders in the then Federal Magistrates Court. The lawyers acting for the wife were R & Associates. In short, the wife’s application sought orders that the A Street property be sold and that she receive 70 per cent of the combined value of the A Street property and the husband’s share in the W Street property.
The husband instructed H Legal and the matter came before the Court on 10 August 2009. Directions were made by the Federal Magistrate for the wife to file a Financial Statement and affidavit by 24 August 2009 and the husband to file a Response and a Financial Statement by 11 September 2009.
Shortly on or before 8 September 2009 the wife received a document entitled “Deed of Agreement” by post at the A Street property. It was, in fact, an offer to resolve the proceedings. Although it had been sent directly to the wife, it had been prepared for the husband by his lawyers. Relevantly, the offer provided that if the A Street property was sold, 60 per cent of the proceeds of that sale would be paid to the wife and 40 per cent to the husband. The document then went on to propose a distribution of the A Street property to the children, in defined proportions, in the event that either the husband or the wife died. The husband was to retain his interest in the W Street property.
Two matters of significance arise from this document. The first is that this document seems to be the origin of a proposal that ultimately found its way into the final orders made on 4 November 2009, namely that the husband and the wife effectively each obtained a life estate in the A Street property and then on their death the property passed to the children.
The second matter of importance is that this document was prepared by the husband’s lawyers. The lawyer having the conduct of the file was Ms D, who had only recently been admitted as a legal practitioner. However, the evidence established to the primary judge’s satisfaction that this document was not prepared by Ms D but by Mr H, the principal of the firm.
On 14 September 2009 Mr R received a letter from a friend of the wife’s, in which the wife significantly modified the proposal she had earlier made. This led to the wife’s lawyers preparing an Offer of Compromise which was dated 14 September 2009 and in which, amongst other things, it was proposed that the wife obtain a life estate in the A Street property.
On 16 September 2009 the proceedings again came before the Federal Magistrate. By this stage the wife had filed and served her Financial Statement but no other documents had yet been filed. Further directions were made extending the time for the husband to file and serve a Response and Financial Statement to 16 October 2009. The matter was stood over for directions on 4 November 2009.
On 28 October 2009 a conference was held at the office of Mr R which was attended by Ms D, the husband and one of the husband’s brothers. The wife was present in another room. Ultimately a document described as an offer of compromise was signed by both parties.
Two days later on 30 October 2009 the husband met with Ms D and Mr H, in the course of which the husband signed a statement acknowledging that he had received legal advice on the terms of the Offer of Compromise and their effect on his rights.
On 4 November 2009 Mr R and Ms D appeared before the Federal Magistrate who, by consent, made the following orders:
1.The orders, notations and declarations are made in accordance with the document titled “Terms of Settlement”, dated 4 November 2009, and marked with the letter “A” and initialled by the Federal Magistrate.
2.All applications and cross applications are otherwise dismissed and the case is removed from the list of cases awaiting finalisation.
[Exhibit A]
Orders by Consent
Final Orders
BY CONSENT IT IS ORDERED:
1.[The husband] to transfers [sic] to [the wife] fifty per cent (50%) of the property at [A Street, Suburb U], being Folio Identifier […]. The respective interests in the said property shall be held as tenants in common.
2.[The husband] to give [the wife] a life estate in the property at [A Street, Suburb U].
3.[The husband] must not to sell, transfer, charge or otherwise deal with his fifty per cent 50% share of the property at [A Street, Suburb U] other than in accordance with these orders.
4.[The husband] acknowledges [the wife’s] right to lodge a caveat over his interest in the property at [A Street, Suburb U].
5.When [the husband] dies, his one half share of the property at [A Street, Suburb U] be transferred to [the wife].
6.If [the wife] sells her 50% share in the property at [A Street, Suburb U] during her lifetime, then [the husband] is at liberty to sell his 50% share and retain the proceeds of sale.
7.When [the wife] dies, her interest in the property at [A Street, Suburb U] be transferred to [the husband] to be held by him on trust for the children of the marriage as tenants in common in equal shares and to be transferred to the children of the marriage as tenants in common in equal shares upon the death of [the husband].
8.[The husband] not to enter or approach within 300m, the property at [A Street, Suburb U].
9.[The husband] be declared the absolute owner of his interest in the property at [W Street, Suburb U].
IT IS DIRECTED:
1.That the Minutes of Consent Orders remain on the Court file.
THE COURT NOTES:
2.That the parties intend these orders shall as far as practicable finally determine the financial relationships between them and avoid further proceedings between them.
On 24 November 2014 the husband filed his Initiating Application seeking that the consent orders be set aside. On 2 March 2015 a Case Guardian was appointed for the husband.

The appeal

Ground 1

The primary judge erred in principle by failing to find that the circumstances in which the orders under challenge were made in the Federal Magistrates Court (“the lower court”) on 4 November 2009 constituted “circumstances” which enlivened the operation of s79A(1)(a) of the Family Law Act 1975 Cth (“the Act”).

This ground might be seen as asserting that the orders of 4 November 2009 were made in error, and indeed many of the submissions that were made on the husband’s behalf strayed into that territory. Nonetheless, under this ground, two matters were raised that were indeed allegations of error against the primary judge. It is therefore necessary for us to deal with them.

Did the primary judge err in finding that the husband had not established that he was not competent to conduct his affairs on 4 November 2009?

The husband’s contention before the primary judge was that in November 2009 he lacked the capacity to manage his affairs and that this was a relevant “any other circumstance” under s 79A(1)(a). That contention was rejected by the primary judge because he was not satisfied that the lack of competency had been established by the husband.
The lynchpin of the husband’s submissions is the following passage in a report prepared on 4 March 2009 by a clinical neuropsychologist engaged by P Health Service. The conclusion was:
Overall, his poor decision making abilities, lack of money management skill and poor knowledge of personal financial and asset issues suggest he could be at risk of significant financial disadvantage if he is allowed to manage his finances without assistance. Whilst he does not have a documented history of financial mismanagement, due to these factors he will be at risk of making poor financial decisions. In particular, due to the change in financial situation, that is, his divorce settlement, he will be at risk of disadvantage or loss if he is allowed to manage this aspect of his finances without assistance. Therefore, in my professional opinion, based on assessment, interview and behavioural observations, it would be in Mr [Badawi’s] best interest if financial decision making for his divorce settlement be formally be referred to a guardian.

The husband called Dr N, his current treating psychiatrist, to give evidence as to his likely mental state in November 2009. In preparing his opinion Dr N took into account the neuropsychological evaluation to which we have just referred, together with a number of other relevant hospital and medical records. Dr N expressed the opinion that the husband currently “has a chronic delusional belief involving his family, his neighbours, the police and the government”.
As to the husband’s mental state in 2009 Dr N said in his report:
With regards his state of mind in 2009, I understand he was not receiving treatment around that time and hence he is likely to have been affected by an acute exacerbation of his chronic condition. During acute exacerbations of mental illness, he would be unable to communicate effectively in order to instruct a legal representative, or make rational decisions about the conduct of his legal proceedings.
After referring to this evidence the primary judge said:
164.It is to be observed that Dr N did not express the view that by virtue of having a mental illness, the husband would be unable to communicate effectively to instruct a legal representative or make rational decisions about the conduct of his family law proceedings. Rather, Dr N expressed the view that such incapacity on the part of the husband would occur “during acute exacerbations” of the husband’s mental illness.
165.The task before the Court then becomes one of assessing whether in the period leading to the making of the Consent Orders, as well as the day of the making of the Consent Orders, the husband was suffering from such an “acute exacerbation” of his mental illness.
The primary judge then referred to evidence given by Dr N in

cross-examination, in which he agreed that he was not aware of two relevant events that had occurred after the Consent Orders were made. The first was that in late 2009 the husband had suffered injuries when hit on the head with a metal broomstick, which had necessitated an ambulance being called. The second was that the husband had been involved in a car accident in December 2009.
Further, Dr N was of the understanding that the husband was not receiving treatment for his mental health in 2009. The primary judge found that in April 2009 the father was discharged on a community treatment order to stay with his brother. The primary judge recorded that “[n]o evidence was presented that the husband was not provided with treatment in accordance with the community treatment order” (at [170]).
Neither of these findings was challenged in the appeal.
The primary judge said:
171.Despite being impressed by Dr [N] as a particularly genuine and sincere witness, his own evidence was such that I must attach little weight to his opinion that, at the time the Consent Orders were made, it is likely that the husband was suffering from an “acute exacerbation” of his mental illness.
The primary judge continued:
173.All parties acknowledge that the husband had issues with his mental health during the course of the marriage and that he continues to have those issues. This is acknowledged, for instance, in a letter from [R] & Associates to the husband dated 17 February 2009 wherein it is stated under the heading “Contribution”:
[The wife] cared for you for a substantial period during cohabitation while you had a mental health illness.
174.Further it was accepted that at the time the husband was served with the wife’s Application for Divorce on 13 February 2009, he was receiving mental health treatment at [X] Hospital.
175.However, there is no evidence that the husband was suffering an “acute exacerbation” of his mental illness in the period immediately prior to the making of the Consent Orders. Indeed, the indications are to the contrary. For instance, the “Deed of Agreement” provided by [H Legal] on behalf of the husband, directly to the wife in the period shortly prior to 8 September 2009, included provision for either party to rescind the agreement prior to completion if one of the parties became “mentally ill”. The clear implication from the inclusion of that provision is that [H Legal] did not consider the husband to be mentally ill at that time.
(Footnotes omitted)
Again, these matters were not challenged on appeal. This led the primary judge to conclude as follows:
177.For the reasons discussed above, I place little weight on the opinion of Dr [N] and prefer the contemporaneous evidence provided by Mr [H] regarding the presentation of the husband at the time shortly prior to the Consent Orders being made.
178.In light of that contemporaneous evidence, the husband has not satisfied me on the balance of probabilities that, at the time the terms of settlement were agreed upon in October 2009 and at the time the Consent Orders were made on 4 November 2009, he was a person who was not competent to conduct litigation without a case guardian as contemplated by r 11.08 of the then FMC Rules.
The opinion of the clinical neuropsychologist was that the husband could not conduct his financial affairs or the divorce settlement without assistance. Throughout the course of the conduct of the property proceedings the husband had the assistance of his solicitors.
Dr N took the matter further and opined that during acute exacerbations of mental illness the husband would be unable effectively to instruct a legal representative. The difficulty, of course, is that the primary judge found that there was no evidence of an acute exacerbation of the husband’s mental condition at the relevant time.
The difficulties that face an appellant seeking to challenge primary findings of fact are well known (Fox v Percy (2003) 214 CLR 118; State Rail Authority (NSW) v Earthline Constructions Pty Ltd (In Liq) (1999) 160 ALR 588).
The evidence of the clinical neuropsychologist that the husband needed assistance with his affairs was taken into account by Dr N, whose evidence was accorded little weight by the primary judge for the reasons set out earlier. As it is clear that, at the relevant time, the husband had the benefit of legal assistance, we consider that the finding by the primary judge as to the weight to be given to the evidence of Dr N was neither glaringly improbable nor contrary to compelling inferences.
This aspect of the challenge has not been made out.

Was there a relevant suppression of evidence?

The husband submitted that it constitutes an error for a Federal Magistrate to make a consent property order when the rules as to the filing of affidavits have not been complied with. It was also submitted that the wife had failed to disclose the extent of the husband’s property, mental state and living conditions. To some extent the submission has aspects of asserting error on the part of the Federal Magistrate, the difficulties with which we have already discussed. It was, however, also submitted to the primary judge that these matters constituted a “suppression of evidence” within the meaning of s 79A and we shall therefore address the submission in that context.
The relevant rules that were in place in the Federal Magistrates Court in 2009 in relation to financial matters were r 4.03 and r 24.02 of the Federal Magistrates Court Rules 2001 (Cth) (“the Rules”):
4.03 Response to application
(1)A respondent to an application may file a response in accordance with the approved form.
(2)A response must be filed and served within 14 days of service of the application to which it relates.
24.02 Financial statement
(1)An applicant, or a respondent who files a response, must file and serve with the application or response:
(a)a financial statement in accordance with the approved form; or
(b)an affidavit of financial circumstances.
Thus the wife was only obliged to file a Financial Statement or an affidavit of financial circumstances. She filed the former and thus complied with the Rules.
The husband submitted that had the wife filed an affidavit in accordance with her obligations of disclosure, the Federal Magistrate would then have been aware of the husband’s mental health condition, that he had no fixed place of abode, that the husband had brought the totality of the assets into the marriage and that the effect of the orders on the husband would be that he had nowhere to live and no realisable property. Thus, the submission continued, there had been a suppression of evidence which enlivened s 79A(1)(a).
As we have said, there was no obligation under the Rules to file such an affidavit at all at that time. In any event, had the wife filed an affidavit it cannot be assumed that she would have disclosed any of those matters.
Of course, the husband was free to file a Response and Financial Statement or such affidavit in support as he chose but did not.
The question then is, was the wife nonetheless obliged to disclose these matters so that a failure to do so constituted a suppression of evidence?
The fact that, at the relevant time, no obligation had been cast on the wife by either the Rules or a direction of the court to file any evidence other than a financial statement weighs heavily against the finding of such an obligation and a finding that there had thereby been a suppression of evidence.
The primary judge looked at the substance of the matter. His findings were as follows:
69.There was no suggestion that the wife withheld any relevant information from the husband in respect to those matters. In fact, to the contrary, the wife had less information than the husband about each of those matters. Insofar as there was a suppression of evidence or failure of disclosure, it was not by the wife to the husband but rather by the husband to the Court.
70.In Birkbeck & Birkbeck (1970) 16 FLR 78, Carmichael J stated at [92]:
For my part I deprecate the consequences of Mrs Matthew’s submission in the present case that a party having either by choice or inadvertence failed to give relevant evidence should then be able to seek a different decision because he was dissatisfied by what he now says was the result of his own mistake or neglect.
71.More recently, in Lane & Lane [2016] FamCAFC 53, the Full Court at [139] confirmed that the concept of suppression of evidence occasioned by non‑disclosure, for the purpose of s 79A of the Act, “is one party’s failure” to disclose matters:
…“which were peculiarly within [the] knowledge” of that party or omissions which knowingly engendered, or permitted, a mistaken understanding on the part of the other party.
Within that context, it has been said, for example, that suppression of evidence must “amount to wilful concealment of matters which it was [the party’s] duty to put to the Court” and that “the ground is not available to a party who simply fails to give relevant evidence either by choice or inadvertence…”
(References omitted)
72.In this matter it could not be said that any of the matters referred to above “were peculiarly within the knowledge” of the wife. Nor could it be said that the wife was under a duty to put information concerning those matters to the Court.
73.Insofar as the husband alleges that information concerning those matters should have been put to the Court, the appropriate party to do so was the husband. The husband cannot now seek to have the Consent Orders set aside because of the failure by the husband, or more specifically the husband’s solicitors, to put that information before the Court.
The primary judge further said:
88.On that day his Honour did however make orders for the husband to file and serve his Response and Financial Statement by 16 October 2009. It is common ground that the husband did not file those documents.
89.Accordingly, in considering this issue, it is relevant that the absence of information before the Court concerning the husband’s circumstances resulted from a failure on the part of the husband’s legal representatives to file and serve documents in accordance with the orders of Dunkley FM.
90.In University of Wollongong v Metwally(No. 2) (1985) 60 ALR 68, the High Court said:
It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so.
91.This principle is applicable in this case. The husband’s legal representatives failed to provide Dunkley FM with the documents that they were ordered to file on 16 September 2009. It would be contrary to principle to now permit the husband to set aside the Consent Orders made by his Honour on 4 November 2009 as result of the neglect on the part of the husband’s legal representatives to prepare and file those documents.
It is sufficient to say that we consider the primary judge’s reasoning to be entirely correct and that no error has been established.
There was no obligation on the wife to disclose the matters referred to in [48]. They were not matters that were peculiarly within her knowledge of which, absent such disclosure, the husband would be unaware. The relevant failure to disclose these matters was by the husband. Long standing authorities establish that you cannot rely on your own non-disclosure to have orders set aside on the basis that evidence has been suppressed: In the Marriage of Rohde and Rohde (1984) FLC 91-592 at 79,767-79,768; Lane & Lane (2016) FLC 93-699 at [139].

Ground 2

The primary judge erred in principle by failing to find that the orders of the lower court were infected with jurisdictional error, in that the orders were made in the absence of findings of jurisdictional fact, which constituted “circumstances” enlivening the operation of s79A(1)(a) of the Act.

This ground asserts error on the part of the Federal Magistrate. For the reasons given earlier, it cannot be a successful ground of appeal against the orders of the primary judge.

Ground 3

The primary judge erred in principle by failing to find that the legal representation provided to the appellant with respect to the making of the proposed orders was “equivalent to no representation at all”, having accepted, the appellant contends correctly, that such finding would constitute circumstances enlivening the operation of s79A(1)(a) of the Act.

It is clear that grossly inadequate legal representation can constitute a relevant circumstance for the purpose of s 79A(1)(a).
In Clifton at 78,335 and later at 78,338 the Full Court expressed the view, however, that “professional neglect or incompetence” is not sufficient to enliven the subsection but that it may be sufficient when “the representation was so bad as to be the equivalent to no representation at all or if the representation was perverse for example if the representative was in league with the other side”.
The matter was conducted before the primary judge on the basis that the husband’s legal representation was indeed so poor that it was equivalent to no representation at all and also that his representative, Ms D, was in league with Mr R, the wife’s lawyer. Both propositions were rejected by the primary judge but there is no appeal from the latter finding.
The husband’s submission was twofold. First, it was submitted that the primary judge did not give effect to his finding that the legal representation provided by Ms D to the husband was “appalling” (at [151]). Secondly, it was submitted that Mr H’s evidence in fact established that the husband did not understand the advice that he was being given and that Mr H neglected his duties to his client by not doing considerably more to protect the husband. His Honour was said to have erred in not making that finding.
As to the first submission the primary judge found:
151.The only possible conclusion, if her evidence is to be accepted, is that the legal representation she provided to the husband was appalling. Her evidence was to the effect that she did not consult with the husband regarding settlement proposals; she did not comprehend the basics of property law and did not appreciate the property interests that the husband had in the matrimonial property.
152.Ms [D’s] evidence strains credulity in that respect. The initial offer of settlement made by the wife, as reflected in the letter from [R] & Associates to the husband dated 17 February 2009, stated under the heading “Matrimonial Property”:
8. The current matrimonial property is as follows:
9. Real estate property at [A Street, Suburb U] wholly owned by you and unencumbered. This property is worth about $1,200,000.
10. Real estate property at [W Street, Suburb U] owned by you and your brothers. This property is worth $900,000 and is unencumbered.
153.Ms [D’s] evidence that she failed to understand basic procedural concepts such as the need for a “transfer” to transfer an interest in property is difficult to believe. This is particularly so in circumstances where Mr [H] gave evidence that she had acted in several conveyancing matters during the course of her employment with his firm.
154.Even if, contrary to the doubts I have expressed, Ms [D’s] evidence is taken at its highest and she was indeed grossly incompetent, it is nonetheless relevant that the husband obtained independent advice from Mr [H] on 30 October 2009. This was confirmed in a document signed by the husband acknowledging that he had received that advice.
155.In signing that document, the husband acknowledged that he had obtained independent legal advice about the effect of accepting the Offer of Compromise entered into on 28 October 2009 on his rights.
(Footnotes omitted)
Reading those paragraphs as a whole, the only conclusion that can be drawn is that Ms D’s evidence was not accepted. That was a finding that was not challenged and given the evidence of Ms D could not be challenged. There was therefore no finding that her representation of the husband was appalling. This aspect of the husband’s submission cannot be accepted.
The primary judge then went on to refer to the evidence given by Mr H about the independent advice he gave on 30 October 2009. The primary judge said:
156.Mr [H] gave the following evidence in response to cross examination by counsel for the wife:
Q.You would not have signed it unless you had given that advice, would you?
A.That’s correct.
Q.And you wouldn’t – you couldn’t have given that advice without telling Mr [Badawi] that he was giving up his rights in the property, could you have?
A.What – I think we need to be just a little bit – little more precise.
Q.Yes?
Q.What I – the reason I said it the way I said it was because I wanted him to understand clearly, or at least as best as I could ensure, that he was effectively ensuring that the family would remain in the house but he wouldn’t have any access or benefit – sorry – benefit from it.
157.Further, in response to additional questioning, Mr [H] stated:
Q.And in – well the last point is that in going through and giving the advice – can you turn over to page 25 of the bundle [Exhibit 7]?
A.Yes.
Q.You’ve gone to the trouble on page 25 of writing down points 1 to 8. The likelihood is that you explained each of those points to Mr [Badawi]?
A.Yes.
Q.And satisfied yourself the best you could that he understood it?
A.As best I could, yes.
Q.And if there had been any disagreement with any of those points by Mr [Badawi] you would not have signed the certificate, would you?
A.I would have amended the document accordingly.
Q.You would not have allowed this to go to court a few days later with a consent to a term that had been – Mr [Badawi] had indicated he did not want or did not understand?
A.He indicated his understanding. That’s the best I could work with. What – what can any of us do, counsel?
158.Ms [D’s] evidence was also consistent with that of Mr [H]. In cross examination Ms [D] provided the following replies to questions from counsel for the wife:
Q.Do you have any reason to doubt that correctness of the statement on page 26 [of Exhibit 7] ---?---
A.No.
Q.--- that you’ve put your signature to?
A.No
Q.If you had attended the meeting and Mr [H] hadn’t given such advice, I suggest you wouldn’t have signed it would you?
A.Correct.
159.As a result of the husband receiving advice from Mr [H] as to the nature of the terms of settlement and impact of the settlement on his rights, it cannot be said that the legal representation provided to the husband is “equivalent to no representation at all”.
(Footnotes omitted)

Counsel for the husband referred to the following evidence given by Mr H which she submitted indicated that Mr H had failed to give advice “to encompass facts and circumstances which, pursuant to s 79(4) and s 75(2) of the Act were pivotal to the justice and equity of the proposed orders”:
[MR PATERSON:] And so you must have read these terms of settlement. Now, I think your affidavit you comment that you think you said to [Ms D] that these terms are strange. You recall saying that to her?
[MR [H]:] Yes, I – the – the terms stuck in my mind.
[MR PATERSON:] Can I just press you a little bit on that. Were they strange because you were to understand that your client [Mr Badawi] was about 10 years older than [Ms Badawi] and [Ms Badawi] got a life interest in the property which would mean that [Mr Badawi] wouldn’t get the benefit of it? That’s a strange aspect of it, isn’t it?
[MR [H]:] Well, that’s one of the strange aspects, yes.
[MR PATERSON:] And that’s something ‑ ‑ ‑?
[MR [H]:] I don’t know that I remembered – I made mental reference specifically to the age difference. But, yes, I thought that he was effectively giving up his ability to – to receive a benefit from what should have been the sale of the property.
[MR PATERSON:] And I don’t want to cut you off but I’m trying to be a little quick. That was something that was firmly in your mind when you spoke to [Mr Badawi] on 30 October, no doubt because you’ve noticed it when you were drafting your document?
[MR [H]:] Yes, I would agree with that.
…
[MR PATERSON:] And that he was wanting the children to be looked after and housed and that was very important to him?
[MR [H]:] At the point – at that point in time, yes, that was one of the things that had come across. So I should in fairness to Mr [Badawi] say this, that there was some confusion at various points during the course of this. It was – admittedly at the time I thought it was mostly a difficulty because of the language barrier. But I – if I look at it now, seven, eight – seven-odd years down the track, I – I think something slightly differently, but yes.
[MR PATERSON:] You don’t have qualifications to express a medical opinion, do you?
[MR [H]:] No. But I do have a psych degree.
[MR PATERSON:] When did you get that?
[MR [H]:] Same time I got the law degree. I completed my degree in eighty – sorry, 98.
[MR PATERSON:] And I just want to confine your answer to your impressions that you’ve – in 2009, October 2009?
[MR [H]:] Of course. Okay.
[MR PATERSON:] You with your psych degree didn’t twig with any mental illness that stopped this man giving you proper instructions or understanding your advice?
[MR [H]:] I accepted the easiest answer at the time – or what seemed to be the most obvious answer, that there was a language barrier.
[MR PATERSON:] If there was any suspicion in your mind, with the benefit of your psych degree, or otherwise, that this was a man who had psychiatric difficulties, you would not have allowed this to take the course that it took?
[MR [H]:] If I had – if I had really twigged on it, yes, it – I would have certainly done things a bit differently.
(Transcript 5 May 2016, pp.135-136)
That evidence had to be seen in the light of the passages referred to by the primary judge, which we have already quoted above at [67], and also by the following additional passages of the evidence of Mr H.
[MR [H]:] What I – the reason I said it the way I said it was because I wanted him to understand clearly, or at least as best as I could ensure, that he was effectively ensuring that the family would remain in the house but he wouldn’t have any access or benefit – sorry – benefit from it.
[MR PATERSON:] Yes.
HIS HONOUR: And can I just, and was that the advice you gave him?
[MR [H]:] That’s my recollection, your Honour, yes.
MR PATERSON: And is that something that Mr [Badawi] said to you, that he wanted the family to be looked after?
[MR [H]:] My best recollection is that that was the sense of it, yes. I can’t give you the exact wording.
…
[MS REID:] Right. Was he happy about it?
[MR [H]:] That is very hard to say categorically. I’m trying to picture how he looked back then and it’s difficult. I would not have used the term happy, by any stretch of the imagination. I mean, I don’t even know – if I was going to describe it, I suppose it would have seemed as if it was what he had to do.
[MS REID:] Right. Did you say to him, “You don’t have to do this, Mr [Badawi]”?
[MR [H]:] I don’t have a specific recollection of it but I’m certain I said somewhere in there, “Are you sure this is what you’re – what you – what you want?”
[MS REID:] Right. But you got the impression that he felt that was what he had to do, nonetheless?
[MR [H]:] Yes. I – this is – this is – see, you’re asking very specific questions about this event and it’s picking at bits in my brain that may or may not be proper recollections. And it’s very hard from – you know, to go back that far and try and clearly recall it. But I’m certain somewhere in the course of that I said to [Ms D] directly, words to the – something along the lines of, “Are you sure he understands what you’re telling him?”
[MS REID:] Yes?
[MR [H]:] Yes. Because somewhere inside my head I just felt there was a mismatch, which is why I wrote the acknowledgment in the way I did. I mean:
The effect of the agreement on the rights on my client.
that’s a very specific wording I used.
[MS REID:] Right?
[MR [H]:] To me, that meant I was – I had said to him, “This is what this is going to do. Are you sure that’s what you’re after?”
(Transcript 5 May 2016, pp.136, 140-141)
Counsel for the husband was critical of the vagueness of Mr H’s answers but his recall is not at all surprising since he was giving evidence some seven years after he gave the advice.
It may be inferred from Mr H’s evidence that, at least with the benefit of hindsight, he would have approached the matter differently. However, his evidence established that he went to some lengths to try to explain the terms to the husband because the signed Acknowledgement of 29 October 2009 expressly outlines the eight essential features of the Consent Orders. He said he explained each of these points to the husband, who seemed to understand them. Thus, if Mr H’s evidence is accepted, as indeed it was by the primary judge, there was some explanation to the husband of each of the proposed terms and, by inference, some explanation of the s 79(4) and s 75(2) considerations.
It is also relevant to recall that Mr H had drafted the “Deed of Agreement” in early September 2009, which had been sent to the wife. As we have pointed out, it has many salient features in common with the orders that were made. In particular, the notions of life estates and the children inheriting the residue seem to have arisen from the husband.
On the basis of all of the evidence, it was clearly open to the primary judge to find that the legal representation was not so poor that it in fact amounted to no representation at all. It is not to the point that different, better or even more focussed advice could have been given but whether, in effect, there was no legal representation at all. The acceptance of the evidence of Mr H precluded such a finding.
It is to be noted that in making that finding the primary judge did not rely on or refer to the activities of Ms D and it is therefore unnecessary to refer to them in any detail. It is sufficient to record that even if her representation of the husband was not of a high standard, as the evidence may suggest, the critical parts of the husband’s representation were undertaken by Mr H and the primary judge rightly focussed on his efforts.
This ground has not been established.

Ground 4

The primary judge erred in principle by failing to find that orders 5 and 7 of the orders of 4 November 2009 were infected with jurisdictional error, or were beyond power.

It is convenient to set out orders 5 and 7:
5.When [the husband] dies, his one half share of the property at [A Street, Suburb U] be transferred to [the wife].
…
7.When [the wife] dies, her interest in the property at [A Street, Suburb U] be transferred to [the husband] to be held by him on trust for the children of the marriage as tenants in common in equal shares and to be transferred to the children of the marriage as tenants in common in equal shares upon the death of [the husband].
The husband’s submission is that these orders derogated from the “rights of the parties to freedom of testation” and that therefore the Federal Magistrate had no jurisdiction or power to make them.
Whilst this ground is again an appeal from the orders of the Federal Magistrate, we propose, notwithstanding, to deal with the submissions as we consider this ground to be entirely misconceived. In doing so, we make clear that we do not accept that to the extent there is, in fact, a concept of freedom of testation, it has the effect contended for by the husband. The authorities he cited in support of this ground (Alexander v Jansson [2010] NSWCA 176; Savic v Kim [2010] NSWSC 1401) refer to such a notion in the course of litigation concerning deceased estates or applications under family provision legislation.
First, the orders, as is apparent from their face, do not limit the power of testation. They simply provide that the A Street property is to be dealt with in a specific way.
Secondly, s 79(1)(d) of the Act empowers the Court to make such order as it considers appropriate requiring either or both parties to the marriage to make for the benefit of either or both of them or a child of the marriage such settlement or transfer of property as the Court determines. Orders 5 and 7 clearly fall within the phrase “settlement or transfer of property”, as would, in our opinion, a testamentary disposition.
Finally, the effect of the orders is to remove property from the husband’s estate. That is an entirely permissible cause of action and does not affect his freedom to make a testamentary disposition in relation to what remains of his estate. It is obvious that a person can deal with the property in their hands as they see fit; this, of course, affects his or her capacity to make a testamentary disposition in respect of that property. A person may, for example, give away, charge or sell their property. More relevantly, a person can enter into a contract to make a will in a specific form or agree with another person to make mutual wills – both of which will be enforced by courts of equity. As an example of equity finding that the testator’s freedom of testamentary disposition was constrained by promissory estoppel and for a thorough discussion of relevant principles, see Delaforce v Simpson-Cook (2010) 78 NSWLR 483.

Ground 5

The primary judge erred in principle by failing to find (at AB 1, p.49, para 185) that, if his Honour had been satisfied that the appellant had established a ground for relief pursuant to s79A(1)(a) of the Act, his Honour could not have been satisfied that a miscarriage of justice had occurred, or by failing to adequately expose the process of reasoning which lead his Honour to find as he did.

The husband submits that the following finding was not open to the primary judge or that, alternatively, inadequate reasons were given for it:
185.If contrary to that which I have found, I had been satisfied that the husband had established a ground for setting aside the Consent Orders under s 79A(1)(a), it would nonetheless have been necessary for the husband to have satisfied me that a miscarriage of justice had occurred as a result of that ground. On the facts of this case, I could not have been so satisfied.
The principle stated by the primary judge in the paragraph above is, without a doubt, correct: In the Marriage of Oastler and Oastler (1993) FLC 92-390; In the Marriage of Prowse and Prowse (1995) FLC 92-557 at 81,565; In the Marriage of Patching and Patching (1995) FLC 92-585 at 81,797; Gitane & Velacruz (2008) FLC 93-371 at 82,566; Lane & Lane (2016) FLC 93‑699 at 81,194.
The consideration of a miscarriage of justice arises only if one of the relevant grounds under s 79A(1)(a) has been established. None was and the appeal against the primary judge’s finding will be dismissed.
Therefore there is no point to any consideration of the adequacy of the reasons, save to say that the primary judge’s reasoning process is apparent from the reasons and the parties can see how this issue was resolved (In the Marriage of Bennett and Bennett (1991) FLC 92-191; Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [58] – [59]).
There being no merit in any of the grounds of appeal, the appeal will be dismissed.

Costs

The parties were not in a position to deal with the issue of costs and may wish to call evidence in relation to that issue. We will accordingly make directions for the parties to address this issue by way of written submissions.

Ms D

In support of the claim that Mr R and Ms D had acted in concert, the husband tendered a number of text messages that passed from Ms D to Mr R in 2015 after Ms D had been contacted to see if she would give evidence. When looked at as a whole we are concerned that the text messages of Ms D could suggest that she was prepared to modify her evidence if she was paid outstanding monies she asserted she was owed by Mr R.
We stress that we do not make any findings as to this matter but our disquiet causes us to direct that the Principal Registrar forward a copy of these remarks and the relevant exhibits to the Legal Services Commissioner for further consideration, if any.

I certify that the preceding eighty nine (89) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Bryant CJ, Aldridge & Johnston JJ) delivered on 14 July 2017.

Associate:

Date: 14 July 2017