Beidenhope and Cantanor

[2011] FamCA 669

FAMILY COURT OF AUSTRALIA

BEIDENHOPE & CANTANOR [2011] FamCA 669

FAMILY LAW – PRACTICE AND PROCEDURE – Stay of proceedings – Determination of the husband’s application for a stay of the wife’s property division proceedings in this Court – The Court has a discretionary power to grant the stay the husband seeks – Where the parties signed a pre-nuptial agreement in the Netherlands – Where the husband seeks to have the Australian proceedings stopped so the proceedings he has commenced in the Dutch Court are the only proceedings in relation to the parties’ property – Whether the terms of the pre-nuptial agreement should be decisive of a finding that this Court is clearly inappropriate a forum – Finding that this Court is not a clearly inappropriate forum – Order that the husband’s application is dismissed

 

APPLICANT: Mr Beidenhope

RESPONDENT: Ms Cantanor

FILE NUMBER: BRC 117 of 2010

DATE DELIVERED: 30 August 2011

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Forrest J

HEARING DATE: 5  August 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT:

SOLICITOR FOR THE APPLICANT: Charles Cooper Lawyers

COUNSEL FOR THE RESPONDENT: Dr M Sayers

SOLICITOR FOR THE RESPONDENT: Hopgood Ganim Lawyers

Orders

1.   The husband’s Application in a Case filed 20 October, 2010, seeking an order that the Initiating Application of the wife filed 7 January, 2010, be stayed, is dismissed.

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

FAMILY COURT OF AUSTRALIA  AT BRISBANE

FILE NUMBER: BRC 117  of 2010

Mr Beidenhope  

Applicant

And

Ms Cantanor

Respondent

REASONS FOR JUDGMENT

1. The husband is a citizen of the Netherlands, currently living there. The wife is Australian, living here in Brisbane with the two children of the marriage.

1. Having met on holidays in Thailand in 1989, the couple commenced cohabitation in South Africa in 1990, and lived there until they relocated to the Netherlands in August, 1993.

2. In October, 1994, they signed a document described as a “pre-nuptial agreement” in the Netherlands and then married. In April, 1995, their first child was born in the Netherlands. In July, 1997, their second child was born in Australia. In April, 2002, the family moved to Australia after having lived in various parts of the world as well as the Netherlands. In September, 2008, the couple separated on a final basis when the husband moved back to the Netherlands.

3. The husband commenced proceedings for a dissolution of the marriage, spousal maintenance and property division pursuant to the pre-nuptial agreement in a court in the Netherlands in December, 2008. In early January, 2010, that application was struck out because the Dutch court lacked  jurisdiction, the husband not having met the jurisdictional requirement of at least six month’s residence in the Netherlands immediately prior to filing his application. Immediately afterwards, the wife commenced proceedings in this Court for property division. A few months later, the husband appealed the first instance strike-out decision of the Dutch court. In October, 2010, the husband filed an application in this Court seeking a stay of the wife’s property division proceedings. In December, 2010, the husband’s appeal in the Netherlands was dismissed and in January, this year, the husband filed another application for dissolution, spousal maintenance and property division in the Netherlands.

4. This is the determination of the husband’s application for a stay of the wife’s property division proceedings in this Court. The husband seeks to have the Australian proceedings stopped so that the proceedings he has commenced in the Dutch court continue as the only process of judicial determination of the rights and obligations of the couple in respect to their property and finances consequent upon the breakdown of their marriage. The wife opposes the application for the stay.

5. This Court has the discretionary power to grant the stay the husband seeks.[1]  The stay should be granted if this Court is so clearly inappropriate a forum for the determination of the particular proceedings that have been commenced that their continuation would be oppressive and vexatious to the husband.[2]

What factors are to be taken into account in determining if this Court is a clearly inappropriate forum?

1. The following is a non-exhaustive list of factors that are relevant in the determination of the stay application:-

   (i)Whether each of the courts of the respective countries have jurisdiction;

   (ii)Whether the courts of each country will recognise the other’s orders and decrees;

   (iii)The order in which proceedings were instituted, the stage reached and the costs incurred;

   (iv)The connection of the parties and their marriage with each of the jurisdictions and the issues on which relief may depend in those jurisdictions;

   (v)Which forum may provide more effectively for a complete resolution of the matters involved in the parties’ controversy;

   (vi)Whether having regard to their resources and understanding of language, the parties are able to participate in the respective proceedings on an equal footing.[3]

2. The majority of the High Court in its decision in Henry emphasised the non-exhaustive nature of the above list of relevant factors when saying the determination is “one that depends on the general circumstances of the case, taking into account the true nature and full extent of the issues involved”.[4]

What of those relevant factors in this case?

1. There is no dispute that the courts of Australia and the Netherlands each have jurisdiction to determine the actual proceedings the parties are involved in currently before them in each country. However, counsel for the wife submitted that whilst the children continue to live in Australia “the Dutch court seems to not have jurisdiction in regard to parenting issues”.  That appears to be correct on the affidavit evidence of the wife’s Dutch lawyer.[5] There was no evidence to the contrary put before the Court by the husband’s solicitors.

2. As yet, parenting issues have not become litigious. If they did, whilst the children remain here, it appears this country’s courts and not the Dutch courts are the only courts that could provide complete resolution of all matters arising from the same controversy, namely the breakdown of the marital relationship.[6]  However, whilst only divorce and financial matters are before the courts of both countries, I consider it is essentially to this subject matter that attention must be paid in considering the clearly inappropriate forum issue. Following the Full Court’s decision in Kemeny[7], it could not be said to be beyond possibility for this Court to be the appropriate and, perhaps, the only forum for the determination of parenting matters but yet still be a clearly inappropriate forum to litigate property and spousal maintenance issues. Having said that, I observe that in Kemeny, property orders had already been made in the overseas court when the stay application was being considered and they have not yet been in this case. Accordingly, I nevertheless consider there is some merit in the argument that as only this Court could currently provide complete resolution of all matters arising from the breakdown of the parties’ marriage that it should not too readily be found that this Court is a clearly inappropriate forum for the determination of just the financial aspects of the controversy.

3. The husband’s solicitor argued that orders made in the Dutch court would be recognised in this Court by reference to some case law and the affidavit evidence of the wife’s Dutch lawyer.[8] Counsel for the wife did not argue against that proposition. Rather, he approached the matter in a slightly different manner, pointing to evidence that supports a finding that the Dutch court’s jurisdiction in matrimonial matters does not actually extend to dealing with real property of the married couple that is not situated in the Netherlands.[9]

4. Whilst the provision of the Dutch Code of Civil Procedure that I was referred to appears to provide some support for the Dutch lawyer’s opinion evidence, I was a little troubled about its conclusiveness on the point as it is prefaced with the words “with regard to provisional measures as meant in Article 827, paragraph 1, under point (d) and (e) of the Code of Civil Procedure” and I was not given a copy of that provision of the Code and there was no reference to it by the Dutch lawyer. However, no contrary expert legal opinion of the husband’s Dutch lawyer was put into evidence. That fact and the Mocambique[10] rule’s application in our own common law give me comfort in accepting the evidence of the wife’s Dutch lawyer.

1. In my view, as the only real property of the parties or either of them is in Australia, the Dutch court’s lack of jurisdiction to deal with it further weighs against determining that this Court is a clearly inappropriate forum.

2. This Court’s jurisdiction is in personam as opposed to an in rem (the orders act against the person rather than against the property). Having regard to the terms of the parties’ pre-nuptial agreement, although there is no evidence before me on the point, I expect the Dutch court has in personam jurisdiction as well. It is likely the Dutch court could make an order in personam against one party to pay the other party an amount of money to achieve property division and/or for a party to transfer an interest in property to the other party. Whether such orders, if made, are enforceable in Australia is a different issue.   

1. The husband’s solicitor’s submissions in respect of the recognition of orders made in the Dutch court in this country did not refer at all to the Foreign Judgments Act 1991. That Act establishes a scheme by which foreign judgments can be registered and enforced in the courts of this country. Its provisions extend, at least, to money judgments obtained in the superior courts of countries that are listed in the schedule to the Foreign Judgments Regulations 1992. Whilst a number of European countries are listed in that schedule, the Netherlands is not. I am not convinced, on the evidence, that any orders made in the Dutch court will be recognised and enforceable in this country. This adds further weight, in my view, to the argument against determining that this Court is a clearly inappropriate forum for determining property division between the parties following their marital breakdown.

2. The husband’s solicitor did not argue that property division orders made in this Court would not be recognised in the Netherlands and counsel for the wife did not argue that they would. There was evidence though, from the wife’s Dutch lawyer,[11] that an Australian divorce would be recognised in the Netherlands and that as the wife’s proceedings here were commenced earlier than the husband’s current Dutch proceedings, the Dutch Court is likely to stay the proceedings there on the application of the wife until this Court renders its decision in the wife’s proceedings. Whilst that opinion evidence does not go as far as expressly saying that property division orders as distinct from a decree of dissolution of marriage made by this Court would also ultimately be recognised and enforceable in the Dutch Court, in my view, that inference is reasonably there on that evidence.

1. That same opinion evidence was repeated by the wife’s Dutch lawyer in the affidavit filed by leave on 5 August, 2011, and the husband’s solicitor objected to its admissibility, submitting, effectively, that it was not supported by reference to the intellectual and experiential basis for the concluded opinion reached. That submission, limited to the affidavit filed 5 August, 2011, is, in my view, correct. But the Dutch lawyer’s affidavit filed 2 August contained the same opinions and, in that affidavit, there was ample evidence given by her of the intellectual and experiential basis for the opinion. Again, particularly in the absence of contrary opinion evidence from the husband’s Dutch lawyer, I am drawn to acceptance of the wife’s Dutch lawyer’s evidence.

1. In any event, any in personam order against the husband made in this Court that he pay money to the wife is potentially enforceable here against his interest in the only real property of the parties that is jointly registered in both their names. Enforcement of this Court’s orders against the husband in the Netherlands might not even be required.

2. The husband’s solicitor, in his submissions, emphasised his point that the husband had commenced proceedings in the Dutch court before the wife commenced proceedings here in this Court. That submission was clearly made to gain the advantage in the discretionary exercise that being first in time to commence proceedings is perceived to give. 

3. The High Court did hold in Henry that where proceedings for dissolution of marriage were commenced in both Monaco and Australia, the existence of parallel proceedings necessarily established that one of them was, in the strict sense, vexatious and oppressive. As the proceedings in Monaco were on foot when the Australian proceedings commenced, the High Court found that fact was a most material consideration in determining whether the Australian court was a clearly inappropriate forum.[12]  From that, it is clear that considerable weight is to be given in the discretionary exercise to the fact that proceedings in a foreign jurisdiction in the same controversy were commenced first in time if that is the case.

1. With respect to the husband’s solicitor in this matter, the reality is clear. The husband’s proceedings, first commenced in the Netherlands, were struck out for lack of jurisdiction. The wife’s proceedings were then commenced here. The husband later unsuccessfully appealed in the Dutch courts. A year after the wife had commenced the proceedings in this Court he commenced the current proceedings in the Dutch court, after he had met the jurisdictional prerequisite. The wife’s Dutch lawyer’s evidence is that the Dutch court, too, will recognise the wife’s proceedings in this Court as the first in time and will likely use that fact to stay the husband’s later proceedings. 

1. I do not find that the wife acted without proper motive in these circumstances when she commenced her proceedings in this Court. She clearly perceived juridical advantage in commencing proceedings here, but when she commenced them here, in a Court with jurisdiction, there were no proceedings on foot in the Netherlands, the previously commenced proceedings having been struck out. To the extent that there is advantage in this discretionary process to the party who commenced first in time, I find it is the wife’s advantage in this matter.

2. The wife’s proceedings in this Court are at the point where the parties are, as part of the case management, to participate in a conciliation conference facilitated by a Court Registrar. That process is in place to assist the parties to explore and achieve, if possible, settlement of the matters in dispute.  That conference could be scheduled, I expect, in the very near future. If the matter does not settle at that event it would proceed to trial. There is nothing about this matter, that I am currently aware of, that causes me to think that it will definitely not settle at the conciliation conference or, if it does not, that it could not be made ready for trial quickly after that. It could be expected, once readied for trial, to be listed for a hearing within 3-6 months. 

3. In the husband’s proceedings in the Dutch court the wife has been given until 30 August, 2011, to file her Response to the husband’s application.  That is, given the time difference between the two countries, after this decision has been handed down, although, perhaps unfortunately for the parties, not more than several hours after.  To the extent that causes any difficulties or inconvenience for the parties or the Dutch court, I regret that. I have done my best to deliver this judgment to meet the timing of that event in the Netherlands.

4. The husband’s Dutch lawyer’s evidence[13] was that when the application for divorce is finalised in the Dutch court the husband can bring an application for property settlement which would take approximately 3-6 months to be dealt with in the normal course of events. As the evidence is that the divorce application has not been finalised there yet, the difference in the time within which matters could be finalised in the Netherlands compared to in this Court is, in my view, not indicative of this Court being a clearly inappropriate forum.

5. The parties lived for relatively lengthy periods during their marriage in the Netherlands and Australia as well as in other countries. The longest period they lived in Australia, some 6 years, was at the end of their marriage. The wife is Australian and the husband is Dutch. One child was born in the Netherlands and one was born in Australia. They owned property in the Netherlands but they do not currently. The property they currently own is in Australia. It makes up the vast majority of that which will be divided between them on property division. The wife lives here and currently has the sole care of the two children. The husband returned to live in the Netherlands on the breakdown of the marriage. Each party is in employment earning a reasonable income, the wife a little more than the husband at present. The husband clearly speaks and understands English to a degree that would enable participation in proceedings in this Court on an equal footing.  Consideration of all of these matters does not cause me to determine that this Court is a clearly inappropriate forum in the relevant sense.

What of the pre-nuptial agreement?

1. The point made most strongly by the husband’s solicitor in his submissions was that because the couple entered into a pre-nuptial agreement in the Netherlands prior to their marriage, that included provisions that they submit any dispute exclusively to the jurisdiction of the courts of the Netherlands and that Dutch law was to apply to any settlement of property between them on a breakdown of the marriage, that the matter should not be litigated away from that forum making Australia a clearly inappropriate forum in the relevant sense.[14]

2. In the High Court’s decision in CSR Ltd v Cigna, after confirming that an injunction may be granted to restrain proceedings brought in breach of a contract not to sue, whether the proceedings are brought here or abroad, the majority judges went on to say:-

   Similarly, an injunction may be granted in aid of a promise not to sue in a foreign jurisdiction constituted, for example, by an agreement to submit to the exclusive jurisdiction of the courts of the forum.[15]

3. Dutch and English copies of the document described as a “pre-nuptial agreement” were put into evidence.[16]  In the preamble, the English version says:-

   The persons appearing stated:
   that they are going to be married in [the Netherlands] on the […] of October; that the proprietary effects of their marriage will be governed by Dutch law; that they wish to regulate these effects by the following:-

   The document then contains all the operative articles and Article 13 says:-

Unless otherwise agreed the spouses will submit all disputes exclusively to the Court of the District in which their last joint place of residence in the Netherlands is situated and, in the absence thereof, to the District Court of the Hague, this unless otherwise determined.

1. It appears clear that the couple, in 1994, agreed to submit any property dispute on marriage breakdown to the Dutch courts to be determined by Dutch law.  Counsel for the wife submitted that Article 13 “does not necessarily exclude the parties from invoking an alternative jurisdiction from that of the Dutch courts”, but, having regard to the wording I have set out above, with respect to counsel, I cannot accept that submission. I regard the intent expressed in the document as clear.

1. The question then is whether, when all other relevant matters point to a determination that this Court is not a clearly inappropriate forum to be determining the controversy between the parties, the terms of that agreement referred to should be decisive of a finding that it is a clearly inappropriate forum?

2. The passage cited above from the majority judgment in the High Court’s decision in CSR Ltd v Cigna confirms the discretionary nature of the injunctive remedy. The words “may be granted” are used.

3. In this part of the discretionary exercise, I am mindful of the following  important factors:-

   (i)The principle confirmed by the High Court applies far more appropriately in the context of commercial relationships regulated by contracts than in the context of the very personal relationship of marriage. What the High Court said was in the context of a case involving a commercial relationship regulated by insurance contract and the other cases cited by the High Court on the point were also in respect of commercial disputes.

   (ii)It has long been held that no agreement between parties to a marriage not made in accordance with the relevant provisions of the Family Law Act can preclude either party from bringing and pursuing an application for alteration of property interests under s. 79 of the Act, or for maintenance under s. 74 of the Act, nor prevent this Court from the obligation of deciding such applications in accordance with the principles set out in the Act.[17] Those principles include the obligation not to make an order pursuant to s. 79 unless satisfied that it is just and equitable to do so.

   (iii)This Court has previously held that it is not a clearly inappropriate forum to determine property division proceedings commenced here where the parties had executed a pre-nuptial agreement in France before their wedding that according to both parties’ experts was a valid, binding agreement, at least in France.[18]

   (iv)As counsel for the wife correctly submitted, the parties themselves apparently acted either inconsistently with, or in default of, their obligations under the pre-nuptial agreement during their relationship in as much as:-

   (a)  There is no evidence of them being responsible for their children’s expenses in a manner strictly proportional to their income;

   (b)  There is no evidence of any annual reconciliation or “making good” between them of individual income and joint expenses

   and these were matters expressly provided for in the agreement.

   (v)There is absolutely no evidence that when the parties moved to take up full-time residence as a family in Australia in 2002 that consideration was given to the ongoing relevance and applicability of the pre-nuptial agreement signed back in 1994 in the Netherlands or that their move was made and their property jointly acquired in Australia with cognisance of, and commitment to, any ongoing binding effect of the agreement.  

4. I do not consider, with regard particularly to those matters just set out but also to all of the matters discussed in these reasons, the wife is acting unconscionably in seeking to proceed with her application for property division pursuant to s.79 of the Act.

1. In all the circumstances of this case, for all the reasons I have discussed, I find that this Court is not a clearly inappropriate forum for the determination of the controversy between these parties. Accordingly, I dismiss the husband’s application to stay the proceedings.

I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 30 August 2011.

Associate: 

Date:  30 August 2011

[1]See the High Court’s decisions in Henry v Henry (1996) 185 CLR 571 and CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345.

[2]See Henry and also Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 in which the High Court adopted for Australia the test propounded by Deane J in Oceanic Sun Line Shipping Co Inc v Fay (1988) 165 CLR 197 in which his Honour used the term “oppressive” in the sense of “seriously and unfairly burdensome, prejudicial or damaging” and the term “vexatious” in the sense of “productive of serious and unjustified trouble and harassment”

[3]See the majority judgment in Henry and also paragraph 22 of  the paper “International Elements in Financial Cases in Family Law” presented to the national conference of family lawyers run by the Family Law Section of the Law Council in September, 2010, in Canberra by Michael Kent SC (now Kent J of this Court) and Paul Doolan.

[4]          See Henry v Henry (1996) 185 CLR 571 at 593

[5]See paragraph 7 of the affidavit of Dutch lawyer Fleur Oirbans filed 2 August 2011

[6]          See the discussion in paragraph 37 of the judgment of the majority in Henry

[7]          Kemeny v Kemeny (1998) FLC 92-806 at 85,069

[8]Paragraph 29 of his Case Information document filed 5 August, 2011 in which he cites In the Marriage of Miller and Caddy (1985) FLC 91-625 and Van Der Kreek v Van Der Kreek (1980) FLC 90-810 as authorities for the propositions and reference to the evidence of Fleur Oirbans, affidavit filed 2 August, 2011 paragraph 2

[9]The affidavit evidence of the wife’s Dutch lawyer, Fleur Oirbans, filed 2 August, 2011, paragraph 6 in which Ms. Oirbans says “[t]he Dutch Court is not authorized to rule on a house, that is not located within the Netherlands” – with reference to a English translation copy of the Dutch Code of Civil Procedure that is appendix 3 to that affidavit, Article 4 paragraph 3

[10]British South Africa Co v Companhia de Mozambique [1893] AC 602 – British House of Lords decision that is authority for the proposition that a local court will not exercise jurisdiction in respect of the title to, or possession of, land situated beyond the court’s territorial jurisdiction on the basis that only the Court of the place where the land is situated can effectively enforce an order for possession of, or title to, the land.

[11]         See paragraphs 2 and 3 of the affidavit of Fleur Oirbans filed 2 August, 2011

[12]Henry at page 593

[13]         In his affidavit filed 20 January, 2011, paragraphs 12 and 13

[14]Reference was made to the High Court’s decision in CSR Ltd v Cigna Insurance Limited (1997) 189 CLR 345 to support that submission.

[15]         See CSR Ltd v Cigna  at page 392

[16]         Annexures A and B to the affidavit of the husband filed 20 October, 2010

[17]         See D & D Full Court, unreported, 30 April, 1992 and the list of cases cited therein

[18]         Stafford v Stafford [2005] FamCA 1393