CC & BC
[2007] FMCAfam 56
•6 February 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CC & BC | [2007] FMCAfam 56 |
| FAMILY LAW – Divorce – application for divorce by husband – wife seeks application be dismissed or permanently stayed on the grounds of forum non conveniens – application for permanent stay of proceedings dismissed. |
| Family Law Act 1975 |
| Ferrier-Watson & McElrath (2000) FLC 93-022 Henry v Henry (1996) 185 CLR 571 Lloyd-Harris & Lloyd-Harris (No. ML 2036 of 1996) Oceanic Sun Line Shipping Co Ltd v Fay (1988) 165 CLR 197 Sim v Robinow (1892) 19 R 665 Spiliada [1987] AC 460 Steen & Black (2000) FLC 93-005 Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 |
| Applicant: | CC |
| Respondent: | BC |
| File number: | SYM 3360 of 2006 |
| Judgment of: | Sexton FM |
| Hearing date: | 25 January 2007 |
| Date of last submission: | 25 January 2007 |
| Delivered at: | Sydney |
| Delivered on: | 6 February 2007 |
REPRESENTATION
| Counsel for the Applicant: | Mr G Foster |
| Solicitors for the Applicant: | Gayle Meredith & Associates |
| Counsel for the Respondent: | Mr A Fox |
| Solicitors for the Respondent: | McLellands Solicitors |
ORDERS
That the wife’s application for a permanent stay of the husband’s divorce application be dismissed.
That any application for costs be made in writing within 28 days, such application to be supported by written submissions.
That the respondent to any application for costs file and serve written submissions within a further 14 days.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYM 3360 of 2006
| CC |
Applicant
And
| BC |
Respondent
REASONS FOR JUDGMENT
Introduction
The husband seeks a divorce. The wife seeks a permanent stay or dismissal of his Application on the basis Australia is a clearly inappropriate forum for the proceedings to be heard. The parties are Australian citizens but live in Switzerland. The husband filed an Application in this Court in March 2006. The wife disputed the date of separation deposed to by the husband in his first Application. The husband withdrew his first Application and filed another Application for Divorce on 16 May 2006.
The husband filed an Application for Property Settlement in the Family Court at Sydney on 25 July 2006. In her Response, the wife seeks a permanent stay of that Application on the basis Australia is an inappropriate forum. Those proceedings have been transferred by the Family Court to this Court but have not yet been listed for hearing.
Issue
There is no dispute this Court has jurisdiction under section 39(3) of the Family Law Act 1975 to hear the husband’s Application for Divorce. In Voth v Manildra Flour Mills Pty Ltd[1] [“Voth”], the High Court held that a party who has properly instituted proceedings in Australia has a prima facie right to have the proceedings determined by an Australian Court unless Australia is the clearly inappropriate forum. In Henry v Henry[2] [“Henry”] the High Court held the rule in Voth applies to divorce proceedings but a party’s prima facie right to have the proceedings heard in the jurisdiction in which the proceedings were properly started, should not be overstated.
[1] (1990) 171 CLR 538
[2] (1996) FLC 92-685
The issue is whether Australia is a clearly inappropriate forum to determine the husband’s divorce application. The onus is on the wife to satisfy the Court that Australia is a clearly inappropriate forum. As the High Court held in Henry[3], the question will depend “on the general circumstances of the case, taking into account the true nature and full extent of the issues involved.” The Court must balance the various factors against each other to determine the question of whether Australia is the inappropriate forum.
[3] At 83-123
The Court’s power to stay or dismiss proceedings is discretionary and was described by Deane J in Oceanic Sun Line Shipping Co Ltd v Fay[4]:
“That power is a discretionary one in the sense that its exercise involves a subjective balancing process in which the relevant factors will vary and in which both the question of the comparative weight to be given to particular factors in the circumstances of a particular case and the decision whether the power should be exercised are matters for individual judgment and, to a significant extent, matters of impression.”
[4] (1988) 165 CLR 197 at 247-8
The authorities make clear the Court must direct its attention to the inappropriateness of the local forum and not the appropriateness of the foreign forum. The majority of the High Court in Voth said[5]:
The clearly inappropriate forum test is similar to and for that reason is likely to yield the same result as the more appropriate forum test in the majority of cases. The differences between the two tests will be of critical significance only in those cases, probably rare, in which it is held that an available foreign tribunal is the natural or more appropriate forum but in which it cannot be said that the local tribunal is a clearly inappropriate one. But the question which the former test presents is slightly different in that it focuses on the advantages and disadvantages arising from a continuation of the proceedings in the selected forum rather than on the need to make a comparative judgment between the two forums. That is not to deny that considerations relating to the suitability of the alternative forum are relevant to the examination of the appropriateness or inappropriateness of the selected forum. The important point is that in those cases in which the ascertainment of the natural forum is a complex and finely balanced question, the Court may more readily conclude that it is not a clearly inappropriate forum.
[5] At 565
Proceedings
Each party was represented by counsel. By agreement, the matter proceeded by way of written and oral submissions. Neither party attended the hearing. The wife says she would be significantly prejudiced if the husband’s divorce application were to proceed in Australia because a divorce order will automatically terminate the maintenance order made in her favour in a Swiss Court on 12 January 2006, and will terminate her present right to live in Switzerland.
The wife relies on her Amended Response filed 31 October 2006, her affidavit sworn 20 October 2006, two affidavits of Mr Alain Berger, a Swiss family lawyer sworn 2 November and 13 November 2006 and an affidavit of Ms Sarah Hunt, an Australian solicitor qualified to practise law in Switzerland, sworn 13 November 2006. The husband relies on his Application filed 16 May 2006, his affidavit sworn 30 October 2006 and an affidavit of Mr Gagnebin, a Swiss family lawyer, sworn 31 October 2006. The husband’s counsel further relies on the wife’s Financial Statement filed 6 December 2006 and the husband’s Financial Statement filed 25 July 2006.
Background
The husband is aged 53. He was born in Chile and migrated to Australia in 1980. He is an Australian citizen. The wife is aged 53. She was born in Laos and migrated to Australia in 1978. She is an Australian citizen. The parties commenced cohabitation in 1981 and married on 18 December 1982 in Sydney. It was the wife’s second marriage. She has an adult daughter from her first marriage. There are two children of the parties’ marriage, Lucy (not her real name) born 9 January 1985, now 22 years and Jane (not her real name) born 13 April 1990, now 16 years. Both children were born in Australia and are Australian citizens.
In April 1993 the parties left Australia. In September 1993 the parties and their children moved to Geneva, Switzerland as a result of the husband’s employment with the World Health Organisation (WHO). They have lived there since and the husband is still employed by the WHO. The parties finally separated on 31 March 2005 when the husband moved from the former matrimonial home to other accommodation in Geneva. The husband and the wife are entitled to live in Switzerland as a result of the husband’s employment there.
Agreed facts
The parties’ children are both Swiss and Australian citizens.
The parties are Australian citizens. Neither party holds Swiss citizenship.
The husband and the wife have a right to live in Switzerland and have diplomatic status of immunity only as long as the husband remains employed in Switzerland by the World Health Organisation.
The wife has applied for Swiss citizenship but her application has not yet been determined. Both Mr Berger and Mr Gagnebin, the Swiss family law experts who give evidence in these proceedings, anticipate her application will be successful, although there is no guarantee.
The parties own a property in Geneva, the former matrimonial home, in which the wife and Jane live.
The parties have assets in Sydney and have bought and sold property in Sydney since living in Switzerland:
a)Prior to the parties’ cohabitation, the husband purchased a part interest in an apartment in Sydney’s Eastern suburbs which he retains. The other registered owners are the husband’s sister and his parents;
b)In 1984 the parties purchased a property in Sydney’s Western suburbs which they sold in 1996;
c)In 1996 the parties purchased a property in Sydney’s Northern suburbs which they retain;
d)In 2000 the parties purchased a unit in Sydney’s Western suburbs which was later transferred to the wife’s adult daughter from a prior marriage;
e)In 2002 the parties purchased an investment property in Sydney’s Western suburbs, which they later sold; and
f)The wife holds $21,500 in St George Bank, and $30,850 in State Super. The husband has $5,000 in Commonwealth Superannuation and two bank accounts with negligible savings.
The World Health Organisation recognises the husband’s place of residence as Sydney, Australia.
The husband’s sister and his parents live in Sydney. The wife’s adult daughter lives and works in Sydney and the wife’s three siblings live in Australia. The parties and their two children have regularly travelled to Australia for holidays to visit their extended family.
The husband filed an Application in “Tribunal de Premiere Instance” Republic and Canton of Geneva on 8 August 2005 seeking protective orders in relation to parenting and exclusive use of the former matrimonial home. The wife responded and applied for maintenance for herself and the children. Mr Gagnebin and Mr Berger, both Swiss lawyers, explain that couples who separate in Switzerland can apply to the Court to regulate their arrangements before making any application for divorce. Mr Gagnebin says “the Judgment is made in the hope to avoid a divorce and has the unique purpose to regulate the situation of a couple living separately.” The matter was heard on 24 November 2005 and the “Tribunal” made Orders and gave its Reasons for Decision on 12 January 2006. The proceedings did not involve divorce. The parties have taken the necessary administrative steps to lift the diplomatic immunity of jurisdiction to enable enforcement of the orders of 12 January 2006. Those Orders will be of no effect once a divorce order is granted, regardless of where that occurs.
On 1 April 2007, having been separated for two years by that date, either party will be eligible to commence proceedings for divorce in Switzerland, including orders for property settlement and maintenance. The parties agree the parties’ immunity must first be lifted but on the evidence of Ms Hunt, such application is a formality. The Swiss Court must determine all financial issues between the parties before granting a divorce. Mr Berger refers to this as “unity of judgment”. However, if the parties hold real property outside Switzerland, unless the parties agree on the jurisdiction, the foreign court must rule on the property settlement separately. If the parties do not reach agreement, the whole process may take up to 2 years. Mr Gagnebin says the process can take 2-4 years.
Swiss law will apply only while both parties are domiciled in Switzerland. Otherwise, Australian law will apply.
Decrees of both Courts are mutually recognised.
Legal principles
The High Court in Henry held that a forum will be clearly inappropriate if the proceedings in that court would be oppressive, in the sense of “seriously and unfairly burdensome, prejudicial or damaging” or vexatious in the sense of “productive of serious and unjustified trouble and harassment.” The High Court has held the words “oppressive” and “vexatious” are not to be narrowly or rigidly construed and are to be applied in relation to the effect of the continuation of the proceedings[6].
[6] Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 555
The majority of the High Court in Henry[7] said:
It was also held in Voth that, in determining whether the local court is a clearly inappropriate forum, “the discussion by Lord Goff in Spiliada[8] of relevant ‘connecting factors’ and ‘a legitimate personal or juridical advantage’ provides valuable assistance.”[9] In this last regard, Lord Goff of Chieveley expressed the view that legitimate personal or juridical advantage is a relevant but not decisive consideration, the fundamental question being “where the case may be tried ‘suitably for the interests of all the parties and for the ends of justice’”[10].
[7] at 587
[8] [1987] AC 460 at 477-478, 482-484
[9] Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 564-5
[10] Spiliada [1987] AC 460 at 482, quoting Sim v Robinow (1892) 19 R 665 at 668, per Lord Kinnear
The majority of the High Court in Henry[11] held the matters properly to be taken into account in deciding the question of whether Australia is a clearly inappropriate forum (though the list is not exhaustive) include:
a)Whether the courts of the respective countries have jurisdiction with respect to the parties and the marriage;
b)Whether both courts will recognise each other’s orders and decrees;
c)Which forum can provide more effectively for complete resolution of the matters involved in the parties’ controversy;
d)The order in which the proceedings were instituted, the stage they have reached and the costs incurred;
e)The connection of the parties and their marriage with each of the jurisdictions and the issues on which relief may depend in those jurisdictions; and
f)Whether, having regard to their resources and their understanding of language, the parties are able to participate in the respective proceedings on an equal footing.
[11] At 592
Submissions and findings
Whether the courts of the respective countries have jurisdiction with respect to the parties and the marriage.
This Court has jurisdiction in relation to all matrimonial issues between the parties. The husband has made application in relation to divorce and property.
As long as the parties both live in Switzerland, the Court in that country has jurisdiction with respect to divorce, from 1 April 2007, when the parties have been separated two years but before granting a divorce must be satisfied financial issues between the parties have been resolved or determined. In relation to ancillary family law issues, according to the evidence of the Swiss family law experts, the situation is less straightforward. As already noted, if the parties or either of them own real property outside Switzerland, the Swiss Court has no jurisdiction to deal with that foreign real property without the consent of the parties. The husband has applied for property orders in Australia and his counsel advises the Court that the husband will not consent to a Swiss Court dealing with the Australian property. Unless the husband changes his mind, a Swiss Court will not therefore have jurisdiction to determine property issues, nor to determine issues of maintenance until the property proceedings in Australia have been finalised.
The husband deposes to a new rotation and mobility policy being introduced at the WHO. Having been in a long term placement, he says he may be moved to a different country such as Africa, Asia or Latin America at any time. If that were to occur, he would lose his residency status in Switzerland and any right to apply for divorce in that country, and Australia may be the only jurisdiction in which he could apply for a divorce. He says it would cause him financial hardship if he were forced to re-commence proceedings in Australia.
I find this factor favours the husband’s case.
Whether both courts will recognise each other’s orders and decrees.
Both courts recognise each other’s orders and decrees. A Child Support Assessment by the Child Support Agency can be enforced in Switzerland.
Which forum can provide more effectively for complete resolution of the matters involved in the parties’ controversy.
As already noted, this Court has jurisdiction in relation to all relevant aspects of the breakdown of the marital relationship: divorce, property, spousal maintenance and child support which is administered by the Child Support Agency. As already noted, there are problems for a Swiss Court dealing with all the issues arising out of the marriage, given the parties own real property in Australia. Additionally, once either party commences proceedings for divorce in Switzerland on or after 1 April 2007, the Court will not grant a divorce until spouse maintenance and property issues have been resolved or determined which could take up to 2 years. Mr Gagnebin says a contested divorce can take between two and four years. It is common ground between the parties that if the husband is moved by his employer from Switzerland, he will lose his right to apply for a divorce in Switzerland. The husband’s counsel says if the husband wants to remarry and is working outside Switzerland and his application for divorce is permanently stayed in Australia, he may be unable to apply for divorce.
I find this factor favours the husband’s case.
The order in which the proceedings were instituted, the stage they have reached and the costs incurred.
The husband instituted family law proceedings in Switzerland in August 2005 and orders have been made in relation to occupation of the former matrimonial home, parenting, spousal maintenance and child support. The wife’s counsel submits these orders are, in effect, interim orders and proceedings are therefore pending in a Swiss Court. Counsel submits, on the authority of the High Court decision in Henry[12] that it is prima facie vexatious and oppressive to commence a second action in Australia if proceedings are already pending with respect to the matter in issue. Mr Fox refers to this passage in Henry[13]:
It is prima facie vexatious and oppressive, in the strict sense of those terms, to commence a second or subsequent action in the courts of this country if an action is already pending with respect to the matter in issue… the problems which arise if the identical issue or the same controversy is to be litigated in different countries which have jurisdiction with respect to the matter are such, in our view, that, prima facie, the continuation of one or the other should be seen as vexatious or oppressive within the Voth sense of those words.
It does not follow that, because one or other of the proceedings is prima facie vexatious or oppressive within the Voth sense of those words, the local proceedings should be stayed. However, it does follow that the fact there are, or, even, that there may be simultaneous proceedings in different countries with respect to the same controversy is highly relevant to the question of whether the local proceedings are oppressive in the sense of “seriously and unfairly burdensome, prejudicial or damaging”, or, vexatious, in the sense of “productive of serious and unjustified trouble and harassment”. And it also follows that courts should strive, to the extent that Voth permits, to avoid that situation.
[12] At 579
[13] At 591
The wife’s counsel submits the husband is using the Australian proceedings as a “weapon” to undermine the result of the proceedings in Switzerland. In support of his contention that the current Swiss orders should be regarded as interim, the wife’s counsel points out:
a)Enforcement proceedings are likely, given the wife deposes to the husband failing to pay maintenance in accordance with the January 2006 Orders;
b)It is open to either party to commence further proceedings from 1 April 2007 and once finalised, the orders of 12 January 2006 will be of no effect;
c)The orders made in January 2006 “provide(s) a holding pattern for the parties that enable them to determine whether, over the following two years they are going to be able to reconcile”;
d)The proceedings heard in Switzerland are part of a continuing process relating to the resolution of issues relating to the breakdown of the parties’ marital relationship. Counsel submits “it is part of an ongoing process of resolution”; and
e)In his first Application for Divorce filed in March 2006, the husband deposes to there being ongoing proceedings in Switzerland. In relation to this issue, the husband’s counsel submits the husband’s solicitors simply made an error on the Application, not fully understanding the nature of the Swiss proceedings. Neither counsel brought to my attention that the husband signed his Application on 6 January 2006, 6 days before the Swiss Court handed down Judgment. Proceedings were indeed pending in a Swiss Court at the time the husband signed his Application. His Application was therefore completed correctly.
The husband’s counsel submits the Orders made by the Swiss Court on 12 January 2006 were final orders and there are no proceedings pending in Switzerland. Counsel submits that nothing further will happen unless one of the parties files a further Application after 1 April 2007. The position is different in the Australian family law system where it is not possible to obtain interim orders without filing an Application for Final Orders. It is common ground that if neither party makes a further Application in Switzerland, the current Swiss Orders will continue indefinitely.
I note the Orders of the Swiss Court[14] are headed “The Trial Court pronouncing judgment on protection measures for the marriage.” There is no reference to interim or pending orders nor as to any further steps required to be taken by either party.
[14] Annexure B to the wife’s affidavit filed 31 October 2006.
I am not satisfied the Orders of the Swiss Court are “interim” or “pending.” I am satisfied they are final orders for the protection of the marriage.
I accept the husband’s counsel’s submission that there is no duplication of proceedings. Neither party has filed an Application for Divorce in Switzerland because they cannot do so under Swiss law until 1 April 2007. Mr Gagnebin says the “procedure of protective measures of the matrimonial union” is completely separate from a procedure of divorce which has not been filed in Geneva.
The wife’s counsel submits that when considering whether the present proceedings are oppressive, the Court should have regard to the reasons given by the husband for bringing the application. Counsel submits that the husband’s Application in Australia is “a cynical exercise”. In paragraph 25 of his affidavit the husband says:
My obligation for spousal maintenance continues whilst ever my wife and I remain married.
The husband later says he has a new partner who he intends to marry. He says his de-facto partner will be required to return to Brazil with her child if they are not able to marry.
It is not contested that as soon as a divorce order is made by this Court the Orders of the Swiss Court will no longer apply. Mr Fox submits these proceedings are therefore oppressive, in the sense of “seriously and unfairly burdensome, prejudicial or damaging” to the wife. Counsel submits the facts of this case fall neatly within the terms of the test as expounded by the High Court in Henry. He submits it is exactly what the test was designed to pick up. He relies on the Full Court decision of Ferrier-Watson & McElrath (2000) FLC 93-022[15] in which the Full Court identified partially determined proceedings in Fiji as a reason for “oppression.” In that case, the wife had filed an application in Fiji seeking orders for judicial separation and property settlement. About a year later, the husband filed an Application for Divorce in Australia relying on domicile. The Full Court held that proceedings were pending in Fiji before the husband filed proceedings in Australia. The Court held the parties’ property was in Fiji and the question of the husband’s domicile was being litigated there. The Court held there was a significant risk of orders being made in two Courts based on inconsistent findings. The parties had spent their marital years in Fiji, having married there. Given the very different circumstances in that case to those of the present case, I am not persuaded that authority has application here.
[15] At 87,369
Mr Fox also refers me to the unreported decision of Joske J in Lloyd-Harris & Lloyd-Harris[16]. In that case the parties had lived permanently in the United Kingdom for 4 years and there was no impediment to the parties litigating the issues arising from their marriage breakdown in that country. The husband conducted his business in the United Kingdom. The parties had spent only 4 days of their marriage in Australia. Although the parties held some property interests in Australia, neither party intended to have any connection with Australia in the foreseeable future. At the time the husband applied to the Family Court in Australia, the wife commenced proceedings for property settlement in the United Kingdom. The Court had no difficulty in concluding Australia was a clearly inappropriate forum, given there was no basis at all to justify litigation of the proceedings in Australia. In my view, that case has no application to the present.
[16] (No. ML 2036 of 1996) as cited in Steen & Black (2000) FLC 93-005
The wife’s counsel contends the wife is entitled to generous spousal maintenance orders in Switzerland and if the husband’s application is granted those generous entitlements will be lost. Counsel refers to the Reasons for Decision in the Swiss proceedings. The Court there held:
According to law, as long as the marriage is not dissolved, the spouses retain, even after their separation, equal rights to retain their previous lifestyle. So when the total income of both spouses exceeds their minimum vital needs, the excess is in principle shared equally between them.
He says the wife should be entitled to proceed with the process already commenced by the husband in Switzerland.
I accept the husband’s counsel’s submission that the wife is at liberty to seek spousal maintenance as part of the current property proceedings.
I also agree with him that an Australian court is required to have regard to the standard of living of the parties under section 75(2) of the Family Law Act 1975 when considering a spousal maintenance application.
The husband deposes to an intention to continue to provide financially for the wife and his two children regardless of his future marital status. He says he provided his wife with financial support after their separation and before Orders were made for spousal maintenance and child support in January 2006. While I accept the wife will lose the security of the current maintenance orders if the husband’s application for divorce is granted, there is no evidence before me to suggest the husband, if divorced, will not maintain his financial support. If necessary, the wife will be at liberty to apply to this Court for spousal maintenance and to the Child Support Agency for child support payments. Given property proceedings are on foot, to do so would be relatively straightforward.
The wife’s counsel further submits that if the husband’s Application is granted, she may not be permitted to remain in Switzerland. Counsel submits this would result in significant hardship to the wife and to the children, one of whom is under age. The husband’s counsel submits the wife’s residence status has always depended on the husband’s employment in Switzerland, so this is a problem the wife has always faced and must face at some time. The wife’s counsel rightly concedes this is not a strong argument, particularly given the expert evidence that the wife’s pending application for citizenship is likely to succeed.
I am not persuaded these factors assist the wife’s case.
The connection of the parties and their marriage with each of the jurisdictions and the issues on which relief may depend in those jurisdictions.
The wife’s counsel submits that neither party lives in Australia; neither party has lived in Australia for 13 years; the parties spent more of their married years in Switzerland than in Australia; neither party indicates an intention to return to Australia; the cause of action, being the breakdown of the marriage, occurred in Switzerland.
Mr Foster, the husband’s counsel submits that the parties only went to Switzerland as an incidence of the husband’s employment. He says the husband may be moved to another country in which the WHO operates, at any time. The parties spent 11 years of their married life in Australia, and over half their years of cohabitation in Australia. The parties had two children in Australia and all members of the family are Australian citizens. The parties have bought and sold real estate in Australia and still own real estate in Australia. The parties have strong family connections in Australia. The husband’s employer regards Australia as the husband’s home base.
I accept the parties’ connection with Switzerland arises as a result of the husband’s employment there but find the parties have developed solid connections with that country. It is possible the husband will be required to work outside Switzerland. The wife says she intends to remain living in Switzerland and that her children regard Switzerland as home. The parties have close connections with Australia and visit Australia on a regular if infrequent basis. I find the connecting factors finely balanced between the parties and the two jurisdictions. I am not persuaded this issue clearly favours either party’s case.
Whether, having regard to their resources and their understanding of language, the parties are able to participate in the respective proceedings on an equal footing.
There are no issues of language in this case. Each party is represented in the Australian proceedings. I am satisfied there are no proceedings pending in Switzerland. Neither counsel made submissions in relation to this issue. In my view, no issues arise in relation to this factor.
Conclusion
Weighing the factors I have referred to in these Reasons, I am not satisfied that Australia is a clearly inappropriate forum to determine the husband’s divorce proceedings.
I certify that the preceding fifty-two (52) paragraphs are a true copy of the reasons for judgment of Sexton FM.
Associate: Collette McFawn
Date: 6 February 2007
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