Baudin & Lakatos

Case [2021] FCCA 1914

FEDERAL CIRCUIT COURT OF AUSTRALIA

Baudin & Lakatos [2021] FCCA 1914

File number(s): DGC 3631 of 2020
Judgment of: JUDGE BURCHARDT
Date of judgment: 26 August 2021
Catchwords: FAMILY LAW – Property dispute after 19 years marriage – wife signing purported binding financial agreement
in 2005 – whether agreement vitiated by duress, undue inference and/or unconscionable conduct – wife not speaking or reading English – wife wholly incapable
of understanding the terms of the binding financial agreement and/or its effect – clearly appropriate to set agreement aside – husband owning matrimonial home unencumbered before the start of the marriage – just and equitable division being 80/20 in favour of the husband.
Legislation: Family Law Act 1975 (Cth) s 91K
Cases cited:

Logan v Logan (2013) FLC 93-555

Thorne v Kennedy [2017] HCA 49

Corelli & Beroni [2019] FamCA 911

Stanford v Stanford [2021] HCA 52

In the marriage of Re Mallet (1984) 156 CLR 605
Number of paragraphs: 105
Date of last submission/s: 14 July 2021
Date of hearing: 14 July 2021
Place: Dandenong
Counsel for the Applicant: Mr P Indivino
Solicitor for the Applicant: Ressan Lawyers
Counsel for the Respondent: Mr Glezakos
Solicitor for the Respondent: Rigoli Lawyers

ORDERS

DGC 3631 of 2020
BETWEEN:

MS BAUDIN

Applicant
AND:

MR LAKATOS

Respondent

ORDER MADE BY:

JUDGE BURCHARDT

DATE OF ORDER:

26 AUGUST 2021

THE COURT ORDERS THAT:

1.The matter be adjourned to this Court for mention before Judge Burchardt on 30 August 2021 at 9.30 am

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstance, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment under the pseudonym Baudin & Lakatos is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

JUDGE BURCHARDT

INTRODUCTORY

  1. This is an unusual property dispute. The first issue raised is whether or not an agreement signed on 22 December 2005, and which purported to be a binding financial agreement entered into pursuant to section 90B of the Family Law Amendment Act 2000, is binding or not.  If it is not binding, then there is further argument as to what percentage of the property pool, if any, the wife should receive, the husband’s position being that she should receive none.

  2. For the reasons that follow, I have no doubt that the agreement made on 22 December 2005 should be set aside pursuant to section 90K of the Family Law Act 1975 (“the Act”) on the basis either that it is void, voidable or unenforceable (section 90K(1)(b)) or because the conduct of the husband was, in all the circumstances, unconscionable (section 90K(1)(e)).  The primary reason for this conclusion can be stated shortly.  The wife had no idea whatsoever what it was she was signing.  The purport of the document was not explained to her.  The document is in English, which she does not read.  Her signature is not marked…

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Details
AGLC
Baudin & Lakatos [2021] FCCA 1914
Case
[2021] FCCA 1914
Decision Date

CaseChat Overview and Summary

In the matter of *Baudin & Lakatos*, Ms Baudin (the applicant wife) and Mr Lakatos (the respondent husband) brought proceedings before Burchardt J. The dispute concerned the validity of an agreement between the parties, which the wife sought to have set aside to enable a property adjustment claim. The court also considered the division of the former matrimonial home, the sole asset of the relationship.

The primary legal issue before the court was whether the agreement between the parties should be set aside pursuant to section 91K of the Family Law Act 1975 (Cth). This required the court to determine if the wife had a sufficient understanding of the agreement when she signed it, particularly in light of allegations of duress and unconscionability. A secondary issue was the appropriate division of the former matrimonial home, considering the contributions of each party to the relationship and the asset.

Burchardt J reasoned that the wife lacked a true understanding of the agreement she signed, finding that it had not been properly explained to her. This lack of understanding, coupled with the circumstances surrounding its execution, led the court to set aside the agreement. The court then addressed the property adjustment, noting that the matrimonial home was entirely owned by the husband prior to the relationship. Despite the wife's minimal financial contribution to the home, the court recognised her contributions to household duties and the care of the parties' son. Applying the principles from *In the marriage of Re Mallet*, the court assessed the contributions as 80 per cent to the husband and 20 per cent to the wife.

The court ordered that the agreement be set aside pursuant to section 91K of the Family Law Act 1975 (Cth). The property adjustment was ordered on the basis of an 80/20 split in favour of the husband, reflecting the parties' respective contributions.

Orders

Orders of the court

DGC 3631 of 2020

BETWEEN:

MS BAUDIN

Applicant

AND:

MR LAKATOS

Respondent

ORDER MADE BY:

JUDGE BURCHARDT

DATE OF ORDER:

26 AUGUST 2021

THE COURT ORDERS THAT:

1. The matter be adjourned to this Court for mention before Judge Burchardt on 30 August 2021 at 9.30 am

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstance, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

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Evidence

Evidence Before The Court

In re-examination Mr G confirmed that he would normally ask questions about duress. He does not have a psychology degree. He does not have any notes. Files are destroyed after seven years. He agreed that there was no interpretation clause. The opening and evidence of the applicant wife Counsel indicated that the application was made pursuant to section 90K of the Act. He indicated that duress and unconscionability were raised as issues. The wife was called first and adopted her trial affidavit and financial statement as true and correct. She was taken to a number of passages in the husband’s affidavit filed 5 July 2021. She was first asked about paragraph 5.4 and the words “do you expect me to support you in the event that we separate”. She said this was never said to her by the husband. There was no conversation about separation. Counsel put paragraph 6.2 of the affidavit to her in which the husband had deposed that the husband paid all expenses and she had had her own money. The wife said she had something to save. She paid for furniture and shared household expenses. She bought clothes for the child. She bought things that she did not disclose to the husband because he did not allow her to buy things. She was taken to paragraph 8.1 of the affidavit. She said she had worked but she does not speak English well. In respect of paragraph 8.2 the wife said that husband helped her to get to work. She relied on him totally. She started work in something like 2007. In response to paragraph 11.5 she denied saying to the husband come back and look after the child otherwise you will find him dead. She likewise denied the contents of paragraph 11.7 of the husband’s affidavit in which violence against the child was alleged. She further denied, as alleged in paragraph 12.4 saying, that she could have the husband removed from the home and the words in that affidavit. She further denied paragraph 13 of the husband’s affidavit. She denied the terms of paragraph 15.3 of the affidavit to do with her seeing another male on return to Australia. She had seen a male and waited for him to place his baggage in his car as he wanted her to help him. She denied visiting his house. The wife also denied the words attributed to in paragraph 17 of the husband’s affidavit. When it was put to her in paragraph 17.4 that she had fought regularly with her son she said in English “oh my god no”.Under cross-examination by counsel for the husband The wife was asked what her level of English was. She said it was normal. She did not know much. It is not good enough to talk to the supermarket cashiers. She cannot read or write English, and her spoken English is very basic. The mother was questioned about her education. She said she had been to high school. She spoke no other languages than Country G. She can read and write Country G. When asked how old she was when she left school, she said 19 or 20 when she finished school. She then went on to say perhaps it was 18.

Decision

Reasons for decision

Further, and to repeat, I find that the wife had no understanding of what it really was she was signing. Such an understanding would be beyond her in circumstances where the document plainly had not been properly explained to her, albeit that to do so might be a monumental task on any view. The agreement will be set aside accordingly.CONCLUSION ABOUT THE AGREEMENT For all the above reasons, the agreement plainly cannot be allowed to stand as a bar to the claim the wife now brings. It will be set aside pursuant to section 91K of the Act.STANFORD V STANFORD Once the agreement is set aside, the property aspect of this dispute can be dealt with relatively shortly. The relationship between the parties is at an end. The notion that the wife should receive nothing after a 20‑year relationship only has to be articulated to be set aside. Of course, it is just and equitable that there be a property adjustment.THE POOL The pool, as both parties agree, consists of the former matrimonial home.CONTRIBUTIONS The husband already owned the matrimonial home unencumbered at the commencement of the relationship. Indeed, he had paid it off before that in 2000. The wife never contributed a single dollar to the house, to the mortgage while it existed or, as is quite clear from the materials taken as a whole, to any of the ancillary costs, such as rates, power bills, fuel bills and the like. The highest the wife’s case rises is the assertion that she bought some pieces of furniture and a television unit worth $500. These are wholly trivial in the circumstances. The parties lived off the pension that the husband received, with the exception of the $20,000 earned over two years between approximately 2013 and 2015. So far as the household duties and the care of the son is concerned, the evidence is scarcely very fulsome. I accept that the husband, once he retired in 2003, did contribute more to the ordinary household chores than might otherwise have been thought likely. I note, however, the finding of the Migration Review Tribunal that the husband is a very conservative man with very definite views about the roles of parties in a marriage. My appreciation of the husband’s evidence would lead to the same conclusion. It seems to me more probable than otherwise that the wife did most of the household duties, albeit that the husband plainly did more than a wholly traditional husband would have, as even the wife concedes that he cooked on occasion. As I have indicated, the husband’s evidence about the wife’s difficulties in controlling herself in dealing with her son when young is evidence I accept, and I accept that it was he who did more than the wife to assuage the boy’s resultant fears. In all the circumstances, and emphasising perhaps the fact that the only asset of the relationship is one entirely engendered by the husband, I would assess the contributions as being 80 per cent to the husband and 20 per cent to the wife. Doing this gives, in my opinion, appropriate weight to the contributions of the wife in household duties, a matter which the High Court made plain in In the marriage of Re Mallet (1984) 156 CLR 605 should not be dealt within a tokenistic way. In the circumstances, I repeat, 80/20 is an appropriate assessment.FUTURE NEEDS

Ratio Decidendi

Legal Principle Established

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