Buongiorne and Buongiorne
[2013] FamCA 521
•13 June 2013
FAMILY COURT OF AUSTRALIA
| BUONGIORNE & BUONGIORNE | [2013] FamCA 521 |
| FAMILY LAW – PROPERTY – Interpretation of Financial Agreement |
| APPLICANT: | Ms Buongiorne |
| RESPONDENT: | Mr Buongiorne |
| INTERVENOR: |
| INDEPENDENT CHILDREN’S LAWYER: |
| FILE NUMBER: | MLC | 854 | of | 2012 |
| DATE DELIVERED: | 13 June 2013 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Dessau J |
| HEARING DATE: | 5 & 6 June 2013 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Sweeney |
| SOLICITOR FOR THE APPLICANT: | Taussig Cherrie Fildes |
| COUNSEL FOR THE RESPONDENT: | MR MELDRUM QC with MR CARLILE |
| SOLICITOR FOR THE RESPONDENT: | Doherty & Colleagues Solicitors |
Orders
That paragraphs 29 and 30 of the s 90C Agreement signed by the parties on 11 August 2011 be enforced as if it were an order of the Court.
That within 30 days of the date of these orders the husband pay to the wife the sum of $7,322.32 together with interest in accordance with the Family Law Rules 2004 (Cth).
That within seven days of the date of these orders the wife’s solicitors provide to the husband’s solicitors a detailed calculation of the interest payable pursuant to paragraph 2 of these orders.
That liberty is granted to each party to apply to the Court upon short written notice to the other party.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Buongiorne & Buongiorne has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: MLC 854 of 2012
| Ms Buongiorne |
Applicant
And
| Mr Buongiorne |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION
The husband and wife separated in April 2011, after a seven year marriage. On 10 August 2011 they entered a Binding Financial Agreement. The Application before me calls for the interpretation of paragraphs 29 and 30 of the Agreement, in relation to the extent of the husband’s liability for the wife’s medical expenses.
On the wife’s interpretation, there is presently $7,322.32 owing to her. On the husband’s interpretation, there is nothing owing, and he seeks that her Application for enforcement be dismissed.
MATERIAL RELIED UPON
The wife relies upon:
· Her Initiating Application filed 11 April 2013, annexing a copy of the Agreement;
· Her affidavit sworn and filed 11 April 2013;
· The affidavit of her general practitioner, Dr M, sworn 8 April 2013 and filed 11 April 2013; and
· Her affidavit sworn and filed 31 May 2013.
The husband relies upon:
· His Response filed 17 May 2013;
· His affidavit sworn and filed 15 April 2013;
· His affidavit sworn and filed 17 May 2013; and
· His affidavit sworn 5 June 2013.
The husband also relies on a written outline of submissions.
ORDERS SOUGHT
The wife seeks enforcement of paragraphs 29 and 30 of the Agreement pursuant to s 90KA(c) of the Family Law Act 1975. She seeks that the husband pay her $7,322.32 plus interest for amounts owed to her under paragraph 29 of the Agreement, and that he provide her with a Visa card with sufficient credit to meet his obligations, in accordance with paragraph 30 of the Agreement.
The husband seeks that the wife’s Application be dismissed, and that she provide a full reconciliation and reimburse him for any monies he has paid that he was not required to pay pursuant to the Agreement. He also seeks costs.
As it was clear that the substantive issue is the interpretation of the Agreement, it was agreed that after I have determined that, the parties could turn their minds to any future mechanism for reconciliation of expenses that may be required.
Mr Meldrum, Senior Counsel for the husband, initially sought an adjournment of the proceedings. He submitted that as the wife’s Application sought identical interim and final orders, if interim orders were made, it would in fact be a final determination. That is true, given the limited nature of the Application. Counsel failed to satisfy me however that there was any basis to delay the determination of the interpretation issue. He was unable to persuade me that the issue in itself required cross-examination, or a lengthier hearing than could be achieved on that day.
THE BINDING FINANCIAL AGREEMENT
Paragraph 29 of the Agreement provides:
That [the husband] shall be responsible for and pay for [the wife’s] private health insurance (at the similar level to their current MBF health cover) and any gap payment liability incurred or levied on [the wife] with respect to all non-elective medical treatment, any psychologist fees, haematologist fees, oncologists fees, gynaecologist fees and pharmaceutical expenses until her death or until such time as she remarries or enters into a defacto relationship, (which ever occurs earlier) and [the husband] agrees to indemnify and keep [the wife] indemnified for same, but in any event for not less than 4-years. [Italics added.]
The heart of the dispute is whether the husband’s responsibility for “any psychologist fees, haematologist fees, oncologists fees, gynaecologist fees and pharmaceutical expenses” is referrable to the “private health insurance” and “any gap payment liability”, or whether those fees and expenses stand alone to be paid in full by him.
Paragraph 30 provides the mechanism for paying the amounts required pursuant to paragraph 29 and states:
That for the purposes of making the payments and indemnifying [the wife] in accordance with paragraph 29 of this Deed [the husband] forthwith provided [the wife] with a supplementary Visa card in her name to us [sic] for the sole purpose of meeting any gap payment liability incurred or levied on [the wife] with respect to all non elective medical treatment, any psychologist fees, haematologist fees, oncologist fees, gynaecologist fees and pharmaceutical expenses until her death or until such time as she remarries or enters into a de facto relationship and [the husband] shall ensure that there is sufficient available credit on the card to facilitate such payments. For sake of clarity, [the wife] shall upon receipt of any rebates or refunds or any monies received from Medicare, MBF or any other health provider pay said rebates or refunds or such monies onto the aforementioned credit card.
THE WIFE’S SUBMISSIONS
Mr Sweeney, counsel for the wife, submitted that the “private health insurance” and “gap payment liability” related only to “all non-elective medical treatment”. It did not relate to and therefore limit “any psychologist fees, haematologist fees, oncologists fees, gynaecologist fees and pharmaceutical expenses”. He relied upon the use of the word “any” before “psychologist fees” and the other fees then set out. He submitted that the word “any” had to be given its ordinary meaning.
Mr Sweeney submitted that were those specific expenses to be referrable only to the private health insurance and the gap payment liability, then the word “including” would have been used before “psychologist fees” rather than the word “any”. Alternatively, the word “any” would have been left out altogether, and that would have made it clear that the specifically listed items were referrable to the insurance and the gap liability. But its specific inclusion meant that the husband was to pay in full for those specific expenses.
Mr Sweeney referred to the policy annexed to the husband’s affidavit, “believed” by the husband to be the policy as at the date of the Agreement. Mr Sweeney could not concede that it was the policy at the time of the Agreement, but submitted that even assuming it was, it did not cover haematologist, oncologist or gynaecologist fees, and only covered limited pharmaceutical expenses. He said that supported the interpretation that those fees were specified in the Agreement for the husband to pay in full.
I note at this point that there is insufficient evidence for me to make a definitive finding that the document annexed by the husband is a true reflection of the policy at the time of the Agreement, or that the contentious items in paragraph 29 were covered, not covered, or subject to any caps or exclusions.
THE HUSBAND’S SUBMISSIONS
Senior Counsel for the husband submitted that the proper construction of paragraph 29 is that “all non-elective medical treatment, any psychologist fees, haematologist fees, oncologists fees, gynaecologist fees and pharmaceutical expenses” must be referrable to the “private health insurance” and “gap payment liability”. That is, the husband must pay the insurance and any gap referable to that treatment, those fees and expenses, but is not liable for such treatment fees or expenses that are not covered by the policy or that exceed any cap imposed by the policy.
Mr Meldrum submitted that if it were the intention of the parties that the husband would be liable for all of the wife’s medical expenses, as her interpretation would have it, then that intention would have been reflected in a clearly drafted clause to that effect.
Mr Meldrum referred to the provision in paragraph 29 of the Agreement that the husband is to provide the wife with private health insurance “at the similar level to their current MBF health cover”. He submitted that the clause was clearly intended to benefit the wife, but if the husband were liable to pay all of the wife’s medical expenses, as she claims, a provision for him to pay her health insurance at a particular level would be irrelevant to her. He would be obliged to pay in any event for her expenses.
In his oral submissions, Mr Meldrum relied upon paragraph 30 of the Agreement to assist with the interpretation of paragraph 29. He submitted that the words “sole purpose”, in relation to supplying a VISA card to the wife, supported the husband’s interpretation.
I rejected that submission on the basis that the words that are in dispute in paragraph 29 are repeated in the same form in paragraph 30. The “sole purpose” of the VISA card begs the same question in paragraph 30 as it does in paragraph 29 of the Agreement. Moreover, I note that Mr Meldrum’s oral submission differed from paragraph 21 of the written submission, which referred to paragraph 30 as “simply the mechanism to enable the husband to indemnify the wife”. I am not persuaded that paragraph 30 of the Agreement assists me in the interpretation of the words in question.
RELEVANT LEGAL PRINCIPLES
Section 90KA of the Family Law Act 1975 provides that whether a Financial Agreement is valid, enforceable or effective is to be determined by the Court according to principles of law and equity that are applicable in determining the validity, enforceability and effect of contracts and purported contracts.
Section 90KA(a) and (b) set out powers and remedies available to the Court. Sub-section (c), relied upon by the wife in her Application, provides that “in addition” or “instead”, in making orders under sub-sections (a) or (b), the Court may order that the Agreement be enforced as if it were an order of the Court.
In Sanger & Sanger [2011] FLC 93-484 the Full Court observed, at paragraph 63, that the “law of contract is relevant to the interpretation of the terms of a BFA”. The Full Court went on to consider a summary of the principles applicable to the construction of contracts, as set out in J W Carter, Carter on Contract (Lexis Nexis Australia, online, at October 2011), noting that “a commonsense approach is [to be] taken to the interpretation of commercial documents.”
The Full Court then cited a passage from Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 All ER 98, as later cited with approval in Ryledar Pty Ltd t/as Volume Plus and Anor v Euphoric Pty Limited (2007) 69 NSWLR 603, which included reference to the principle that:
The ‘rule’ that words should be given their ‘natural and ordinary meaning’ reflects the common sense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal documents…
In Hughes & Hughes [2012] FamCA 198, a first instance judgment of this Court, Macmillan J recently reviewed the authorities relating to the interpretation of consent orders. Her Honour concluded that she could not:
…in order to interpret the order, look to the subjective intention of the parties when that order was made. However, if the order is ambiguous …, when construing what is meant by that order, [the Court could] look to admissible evidence of the surrounding circumstances.
In this case, neither party sought to adduce evidence of the surrounding circumstances in order to assist the interpretation of the order, save that the husband did annex a copy of what he believed was the insurance policy as at the time of the Agreement. I have already noted the limitations in the evidence of it.
Neither counsel pointed to any other relevant principle that I should adopt in interpreting this Agreement.
DISCUSSION
The drafting of paragraph 29 of the Agreement is not as elegant as it could have been. Nevertheless, I am satisfied that the wife’s interpretation is the correct one.
Mr Meldrum’s submission that if it were the parties’ intention that the husband would pay all the wife’s medical expenses then the Agreement would simply state that, is based on a false premise as to how the wife put her case. She did not assert that the Agreement provides for the husband to pay all her medical expenses. She said that, pursuant to paragraph 29, he is to pay the relevant health insurance and any gap on non-elective medical treatment on the one hand, and the entirety of the specifically listed fees/expenses on the other hand.
The wife’s interpretation must be correct. The paragraph could have stopped after the words “non-elective medical treatment”, to denote that the husband’s liability was only for insurance and the gap in relation to such treatment. It did not.
The paragraph could have continued then simply with a comma after the words “non-elective medical treatment”, to denote that the husband’s liability was for insurance and the gap with respect to all non-elective medical treatment and the other specified fees, effectively listed. A similar effect could have been achieved by use of the word “and” after “medical treatment”, but before the itemised fees. Otherwise, the word “including” could have been used if the specified items were intended as examples of non-elective medical treatment.
In that latter respect, it is important to consider the nature of the specified items. In so far as they relate to apparently clear “non-elective medical treatment” such as oncology, it is hard to see any reason to list them, that is, unless they were to be treated differently from the other “non-elective medical treatment” for which provision was already made. In so far as they relate to potentially elective treatment, such as some psychologist services, it is understandable that the provision is separate and different from the one made for “non-elective medical treatment”.
I am satisfied that the word “any” is used with, and should be given, its ordinary meaning, so that the husband is to pay the health insurance and gap on the wife’s non-elective medical treatment, as well as any fees incurred for psychologist, haematologist, oncologist or gynaecologist services and pharmaceutical expenses.
For the sake of completeness, I should deal with the alternative interpretation submitted on behalf of the wife. It was that the husband’s liability to pay the “gap payment liability” would in any event cover not only any shortfall between fees paid and the insurance cover, but also, any specified areas of treatment not covered under the policy, or that had exceeded a cap under the policy. That is, the husband would be liable to pay the “gap payment liability” which in those circumstances could be 100% of the fee.
I find that it is a contorted interpretation of the phrase “gap payment liability” which, when given its natural and ordinary meaning, is clearly referrable only to the shortfall between the fees paid and the insurance cover.
CONCLUSION
I am satisfied that the husband owes the wife $7,322.32 on her correct construction of the Agreement, and her amended itemisation of fees.
As discussed though briefly with Counsel, they do need to consider the mechanics for the wife’s full and proper accounting to the husband of fees in the future, and to ensure that he meets those fees via the credit card provided for in paragraph 30 of the Agreement. Counsel need to turn their minds as to how to arrange those mechanics, given the nature of a Binding Financial Agreement.
I certify that the preceding thirty-eight (38) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dessau delivered on <13 June 2013.
Associate:
Date: 13 June 2013
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