Colburn & Cleese
[2020] FamCAFC 278
•16 November 2020
FAMILY COURT OF AUSTRALIA
| COLBURN & CLEESE | [2020] FamCAFC 278 |
| FAMILY LAW – APPEAL – LEAVE TO APPEAL – PRACTICE AND PROCEDURE – De facto relationships – Financial causes – Jurisdictional issue – Where a declaration was made which was not based on agreed or found facts – Hypothetical or advisory opinion – Application for leave to appeal allowed – Appeal allowed – Declaration set aside – Matter remitted for further hearing – Orders made as to written submissions on the issue of costs. |
| Commonwealth Powers (De Facto Relationships) Act 2003 (NSW) s 4 Family Law Act 1975 (Cth) ss 4, 31, 90RC, 90RD, 90SB, 90SM, 94, 114 Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008 (Cth) s 86 Property (Relationships) Act 1984 (NSW) s 41 |
| Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334; [1999] HCA 9 Camden Pty Ltd & Laue and Ors (2018) FLC 93-840; [2018] FamCAFC 91 Dahl & Hamblin (2011) FLC 93-480; [2011] FamCAFC 202 Fencott v Muller (1983) 152 CLR 570; [1983] HCA 12 Fenton v Marvel (2013) 51 Fam LR 142; [2013] FamCAFC 132 Hazeldell Ltd v The Commonwealth (1924) 34 CLR 442; [1924] HCA 36 Multiplex Ltd v Qantas Airways Ltd [2006] QCA 337 Norton & Locke (2013) FLC 93-567; [2013] FamCAFC 202 Re Barrow (2017) 349 ALR 574; [2017] HCA 47 Rizeq v Western Australia (2017) 262 CLR 1; [2017] HCA 23 Warren v Coombes (1979) 142 CLR 531; [1979] HCA 9 |
| APPLICANT: | Mr Colburn |
| RESPONDENT: | Ms Cleese |
| FILE NUMBER: | SYC | 2480 | of | 2016 |
| APPEAL NUMBER: | EAA | 112 | of | 2020 |
| DATE DELIVERED: | 16 November 2020 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney (via video link) |
| JUDGMENT OF: | Ainslie-Wallace, Ryan & Aldridge JJ |
| HEARING DATE: | 1 October 2020 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 29 June 2020 |
| LOWER COURT MNC: | [2020] FamCA 516 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Coleman SC with Mr O’Brien |
| SOLICITOR FOR THE APPLICANT: | Bryant McKinnon Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr Richardson SC with Mr Stewart |
| SOLICITOR FOR THE RESPONDENT: | Dorter Family Lawyers and Mediators |
Orders
Leave is granted to the respondent to rely on the transcript of the proceedings before the primary judge on 24 January 2020.
The application for leave to appeal the declaration made by a judge of the Family Court of Australia on 29 June 2020 is allowed.
The appeal is allowed.
The Notice of Contention filed on 2 September 2020 is dismissed.
The declaration made on 29 June 2020 is set aside.
The matter is remitted for further hearing.
Any party seeking an order as to costs is to file and serve written submissions on the issue of costs not exceeding three (3) pages within twenty-one (21) days. Written submissions in response not exceeding three (3) pages are to be filed and served within a further twenty-one (21) days, with any submissions in reply not exceeding three (3) pages to be filed and served seven (7) days thereafter.
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 Colburn & Cleese 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: EAA 112 of 2020
File Number: SYC 2480 of 2016
| Mr Colburn |
Applicant
And
| Ms Cleese |
Respondent
REASONS FOR JUDGMENT
This application for leave to appeal concerns proceedings commenced by Ms Cleese (“the respondent”) in which relevantly she seeks a declaration pursuant to s 90RD of the Family Law Act (Cth) (“the Act”) in relation to the de facto relationship between herself and Mr Colburn (“the applicant”) and orders for the division of the parties’ property pursuant to s 90SM of the Act. The respondent asserts that she and the applicant were in a de facto relationship that broke down after 1 March 2009. This is relevant because the Court’s jurisdiction is limited to financial matters relating to de facto relationships which broke down on or after that date and s 90SM of the Act is only enlivened in such a case.
The matter is complicated by the fact that the parties had been in an earlier de facto relationship which led to proceedings under the Property (Relationships) Act 1984 (NSW) in the Supreme Court of New South Wales. On 28 November 2006, the parties entered into an agreement as to judgment and orders were made in the Supreme Court by consent, dividing the parties’ property between them (“the consent orders”).
As part of her application to this Court, the respondent sought to have the consent orders set aside. The applicant disputed that the Family Court of Australia had the jurisdiction to entertain that claim.
The parties asked the primary judge to determine, as a preliminary matter, the following questions (at [14]):
…
a.Whether the Family Court of Australia has accrued jurisdiction to determine whether an Agreement as to Judgment at the Supreme Court of NSW pursuant to the Property (Relationships) Act 1984 (NSW) in respect of a de facto relationship between the Applicant and the Respondent should be set aside under section 41 of that Act; and
b.As a question of law, and on the facts as asserted by the Applicant at their highest, whether an estoppel may lie against the Respondent in the terms asserted by the Applicant at paragraph 6 of her Further Amended Initiating Application dated 29 November 2018.
(As per the original)
After hearing submissions as to these questions, on 29 June 2020, the primary judge answered them by making the following declaration:
(1)That the Family Court of Australia has accrued jurisdiction to determine whether an Agreement as to Judgment at the Supreme Court of NSW pursuant to the Property (Relationships) Act 1984 (NSW) in respect of a de facto relationship should be set aside under section 41 of that act.
(As per the original)
The applicant now seeks leave to appeal, and if leave is granted, to appeal against that declaration. The respondent opposes the application for leave to appeal and also relies on a Notice of Contention filed on 2 September 2020.
The respondent sought to rely on the transcript of the proceedings before the primary judge on 24 January 2020. No objection was taken to that course and we will have regard to it.
In order to understand the appeal, it is necessary to set out some further details of the proceedings.
On 29 November 2018, the respondent filed a Further Amended Initiating Application which sought the following declaration:
1.That pursuant to section 90RD of the Family Law Act 1975 (Cth), it is declared that a de facto relationship existed between the applicant and respondent for the following periods:
i.Early 1990 until November 2002; and
ii.September 2006 until July 2010; and
iii.January 2011 until October 2012; and
iv.April 2013 until May 2014.
The application sought consequential orders for the division of the parties’ property and for maintenance.
There is no difficulty with this Court considering the entire period of the relationship asserted by the respondent provided that it is found to have continued beyond 1 March 2009. The Court may aggregate the intermittent periods of the relationship (Dahl & Hamblin (2011) FLC 93-480 (“Dahl & Hamblin”) at [8] and Fenton v Marvel (2013) 51 Fam LR 142 at [54]).
As is obvious, the consent orders are likely to be a significant impediment to this Court having regard to the whole of the relationship asserted by the respondent. The respondent therefore included in her Further Amended Initiating Application, the following claim for relief:
5.That this Honourable Court set aside or vary the Agreement as to Judgment (Orders) entered by the Supreme Court of New South Wales… on 28 November 2006… as it considers appropriate pursuant to s 41 of the Property (Relationships) Act 1984 (NSW).
The estoppel the subject of the second question outlined above (at [4]) refers to the assertion by the respondent that after the consent orders were made on 28 November 2006, the parties developed a common assumption “that they would develop the B Street property [a property which was dealt with by the consent orders] together and continue in their de facto relationship, including, inter alia, the resumption of co-habitation” (the respondent’s Outline of Submissions filed on 24 March 2020, paragraph 4.10(b)) (emphasis in original) from which the applicant could not now depart. The primary judge found that it was not necessary to determine this question (at [38]).
The parties readied themselves for a preliminary hearing pursuant to s 90RD of the Act which permits the Court to make a declaration as to the existence of a de facto relationship and the period or periods that it subsisted. Each party proposed to call many witnesses on that issue. Such a hearing would determine whether the de facto relationship continued past 1 March 2009 and therefore determine whether the Court has jurisdiction to deal with the financial matters as between the parties.
The proceedings came before the Court on 24 January 2020, where the consent orders and the jurisdiction and power of the Family Court to set them aside became the subject of discussion. Ultimately, without hearing the extant application pursuant to s 90RD of the Act, the Court made the direction for separate determination of the questions set out above (at [4]).
Prior to the hearing of the appeal, the Full Court asked the parties to be in a position to address the question of whether the answer given by the primary judge to the separate questions outlined above was hypothetical or academic and therefore should not have been made. This was because the factual underpinning of the jurisdiction of the Court, namely, whether the parties were in a de facto relationship on or after 1 March 2009, had not yet been determined and the nature of the matter (in this case, the length of the relationship) had not yet been identified, making it difficult to identify whether the application to set aside the consent orders formed part of that matter. Thus, the concern was that the declaration made by the primary judge was not based on facts found or agreed and therefore was advisory only.
After hearing submissions on the point, we are satisfied that the declaration sought by the parties was indeed hypothetical or advisory and therefore should not have been made. In order to explain why this is so, it is necessary to look at how and on what terms the Family Court acquired the jurisdiction to determine claims as to financial matters arising out of the breakdown of a de facto relationship and how the concept of accrued jurisdiction might apply so as to enable the Family Court to make orders under s 41 of Property (Relationships) Act 1984 (NSW) setting aside the consent orders.
The state of New South Wales referred its power to deal with financial matters arising out of the breakdown of de facto relationships by the Commonwealth Powers (De Facto Relationships) Act 2003 (NSW). Section 4 provides:
(1)The following matters, to the extent to which they are not otherwise included in the legislative powers of the Parliament of the Commonwealth, are referred to the Parliament of the Commonwealth for a period commencing on the day on which this Act commences and ending on the day fixed, pursuant to section 5, as the day on which the references under this Act are to terminate, but no longer:
(a)financial matters relating to de facto partners arising out of the breakdown (other than by reason of death) of de facto relationships between persons of different sexes,
(b)financial matters relating to de facto partners arising out of the breakdown (other than by reason of death) of de facto relationships between persons of the same sex.
…
Subsequently, the Commonwealth enacted the Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008 (Cth), which introduced Pt VIIIAB into the Act. Section 86 provides:
(1)Subject to item 86A, Parts VIIIAB and VIIIB, and subsection 114(2A), of the new Act do not apply in relation to a de facto relationship that broke down before commencement.
…
(2)To avoid doubt, section 90RC of the new Act does not exclude the operation of any State or Territory law in relation to the de facto relationship.
…
Consequently, s 90RC(2) of the Act provides:
(2)Parliament intends that the de facto financial provisions are to apply to the exclusion of any law of a State or Territory to the extent that the law:
(a)deals with financial matters relating to the parties to de facto relationships arising out of the breakdown of those de facto relationships; and
(b)deals with those matters by referring expressly to de facto relationships (regardless of how the State or Territory law describes those relationships).
The Court may only make orders for maintenance, declarations of property interests and alterations of property interests (Pt VIIIAB, Div 2 of the Act), if, amongst other things in the circumstances of this case, the period of the de facto relationship is two years or the total of the periods of the relationship is at least two years (s 90SB(a) of the Act).
The relevant provisions of the Act commenced on 1 March 2009.
As explained in Dahl & Hamblin at [21]–[24], the effect of this provision is that there is only one de facto relationship, even though it might have been intermittent and existed only in discrete periods.
The Full Court in Dahl & Hamblin at [44]–[47] went on to find that where those periods straddled 1 March 2009, the position did not change, and there continued to be but one de facto relationship. In that case, as the relationship endured past 1 March 2009, the Act applied to it.
The effect of these provisions is that if the de facto relationship between the parties broke down before 1 March 2009 and did not resume after that date, only the Supreme Court has jurisdiction to deal with the financial matters relating to its breakdown and to consider whether the consent orders should be set aside.
On the other hand, if the relationship broke down after 1 March 2009, only the Family Court (or the Federal Circuit Court of Australia) has the requisite jurisdiction to deal with the financial breakdown of the de facto relationship. If this is the case, the nature of the justiciable controversy before the Court would then need to be looked at to see whether the application to set aside the consent orders formed part of that matter.
It is the first task of any court to satisfy itself that it has jurisdiction (Hazeldell Ltd v The Commonwealth (1924) 34 CLR 442 at 446). This, of course, need not be answered at the outset of the hearing, or by a preliminary determination (although it may be), but it must be answered before the court proceeds to exercise powers dependent on that jurisdiction.
The Full Court in Norton & Locke (2013) FLC 93-567 (“Norton & Locke”) held that, in the present context, the exercise of the powers of the Court were dependent upon a finding that a de facto financial cause, as defined by s 4 of the Act, exists. Speaking of s 114(2A) of the Act, which permits the Court to make injunctions “in a de facto financial cause”, the Full Court said:
18.The terms of s 114(2A) are clear; the court’s power to grant injunctions pursuant to the section can only be granted “in a de facto financial cause”. There is no “de facto financial cause” until a de facto relationship is established and the additional ss 90SK and 90SB conditions met. Until they are met – that is, relevantly, a decision has been made by the court consistent with the case advocated by the respondent – there is no “de facto financial cause” and no jurisdiction to make an order of the type contemplated by s 114(2A). (Nor, it might said [sic], more broadly pursuant to s 90SM or s 90SE as sought by the respondent in the substantive proceedings).
That did not, however, prevent the Court from making necessary orders to preserve the status quo pending the determination of whether there was a de facto financial cause (Norton & Locke at [33]–[41]).
At the time that the primary judge determined the preliminary questions posed by the parties, those matters had yet to be determined. The existence of any de facto relationship on or after 1 March 2009 was strenuously denied by the applicant.
The first question posed to her Honour was a question as to the extent of the Court’s jurisdiction in this matter but it assumed that jurisdiction existed. This is because the answer to that question was as to the extent of the matter before the Court rather than whether the matter was one that could be heard by the Court at all. If the de facto relationship had continued beyond 1 March 2009, the issue of whether the application to set aside the consent orders formed part of that matter was a valid consideration. In language no longer favoured by the High Court, the question could also be posed as ‘did the application to set aside the consent orders fall within the accrued jurisdiction of the Family Court?’
In Rizeq v Western Australia (2017) 262 CLR 1, the majority of the High Court (Bell, Gageler, Keane, Nettle and Gordon JJ) explained why this is so:
56.The simple constitutional truth is that State laws form part of the single composite body of federal and non-federal law that is applicable to cases determined in the exercise of federal jurisdiction in the same way, and for the same reason, as they form part of the same single composite body of law that is applicable to cases determined in the exercise of State jurisdiction – because they are laws.
The issue of the extent of a court’s jurisdiction is answered by the nature of the matter before it. This was explained by the majority of the High Court (Mason, Murphy, Brennan and Deane JJ) in Fencott v Muller (1983) 152 CLR 570 at 608 as follows:
… The unique and essential function of the judicial power is the quelling of such controversies by ascertainment of the facts, by application of the law and by exercise, where appropriate, of judicial discretion. In identifying a s. 76(ii) matter, it would be erroneous to exclude a substantial part of what is in truth a single justiciable controversy and thereby to preclude the exercise of judicial power to determine the whole of that controversy. What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships. The scope of a controversy which constitutes a matter is not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out. But in the end, it is a matter of impression and of practical judgment whether a non-federal claim and a federal claim joined in a proceeding are within the scope of one controversy and thus within the ambit of a matter.
A matter might consist of several different issues. See, for example, Camden Pty Ltd & Laue and Ors (2018) FLC 93-840, where the Full Court said:
171.Thus, once the [Family Court of Western Australia] is seized of a matter in the exercise of federal jurisdiction, it has jurisdiction that is, the authority to adjudicate (see Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087; Rizeq per Kiefel CJ at [8] – [9]), all issues comprising the matter. The parameters of the federal jurisdiction which it possesses are the parameters of the matter, the criterion for which is there being a “single justiciable controversy”. A single justiciable controversy might involve differing causes of action; the search being for issues or claims which “arise out of common transactions and facts or a common substratum of facts” (even if the facts do not wholly coincide) (Rana at [36] citing Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 (“Philip Morris”) at 512 and Fencott v Muller (1983) 152 CLR 570 (“Fencott”) at 607).
(Emphasis in original)
Thus, in considering whether the Court could exercise the powers under s 41 of the Property (Relationships) Act 1984 (NSW) to set aside the consent orders made in 2006, the Court would need to consider the nature of the matter before it. If the issue of the continued existence of those consent orders was part of the one justiciable controversy, then clearly the Family Court could exercise those powers.
Where the matter consists of a de facto relationship in various periods from the early 1990’s to 2014 and where it is alleged that neither party had acted on the basis of the consent orders and by their conduct repudiated them (which can be a ground for setting them aside under s 41 of the Property (Relationships) Act 1984 (NSW)), then it could be seen that the one justiciable controversy before the Court included that issue, which was within the jurisdiction of the Family Court to determine.
That analysis, is of course, predicated on a finding that the relationship continued at least beyond 1 March 2009 so that the Family Court did in fact have authority to adjudicate all issues comprising the matter.
This is not what the parties asked the Court to determine. The question as to whether the Family Court had jurisdiction to set aside the consent orders was not based on any facts, agreed or assumed. It did refer to the de facto relationship of the parties but its nature, that is, its length and when it broke down, were in dispute.
It follows that the answer to the questions outlined above (at [4]) could only be properly answered if the Court ultimately found that it had jurisdiction because the de facto relationship persisted beyond 1 March 2009 and that it was one of the issues forming part of the matter before the Court. Its answer was of no effect whatsoever if the Court later found that it did not have jurisdiction or that the application to set aside the consent orders was not part of the matter before the Court.
Courts should not make a determination that does not give “a conclusive or final decision based on a concrete and established or agreed situation which aims to quell a controversy” (Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 (“Bass”) at [45]). Thus, a court should not give hypothetical or advisory opinions (Bass at [47]).
In Bass, the questions “were asked by reference to ‘the matters pleaded in the amended Statement[s] of Claim and the material contained in the agreed bundle of documents’” (Bass at [43]). The Full Court of the Federal Court of Australia, from which the appeal was taken, noted that there was no agreed statement of facts and that no findings of fact had been made (Bass at [43]).
The High Court in Bass explained:
49.As the answers given by the Full Court and the declaration it made were not based on facts, found or agreed, they were purely hypothetical. At best, the answers do no more than declare that the law dictates a particular result when certain facts in the material or pleadings are established. What those facts are is not stated, nor can they be identified with any precision. They may be all or some only of the facts. What facts are determinative of the legal issue involved in the question asked is left open. Such a result cannot assist the efficient administration of justice. It does not finally resolve the dispute or quell the controversy. Nor does it constitute a step that will in the course of the proceedings necessarily dictate the result of those proceedings. Since the relevant facts are not identified and the existence of some of them is apparently in dispute, the answers given by the Full Court may be of no use at all to the parties and may even mislead them as to their rights. Courts have traditionally declined to state – let alone answer – preliminary questions when the answers will neither determine the rights of the parties nor necessarily lead to the final determination of their rights. The efficient administration of the business of courts is incompatible with answering hypothetical questions which frequently require considerable time and cause considerable expense to the parties, expense which may eventually be seen to be unnecessarily incurred.
The importance of a firm factual foundation for declarations was emphasised by the Queensland Court of Appeal in Multiplex Ltd v Qantas Airways Ltd [2006] QCA 337. Keane JA (as his Honour then was) said, with the approval of McMurdo P and Mullins J:
26.… Where a court determines and declares the rights of parties to a dispute, it either establishes the facts itself or acts upon the footing that the facts necessary for the determination of the parties’ rights are established; otherwise the court is not determining the parties’ rights but is merely providing legal advice. That is not the court’s function…
The difficulty in identifying whether a question posed for the Court to answer is hypothetical was identified by Edelman J in Re Barrow (2017) 349 ALR 574. His Honour said:
10.… The boundaries of what is a purely advisory opinion, such that the question would not fall within a justiciable matter, may require a degree of evaluative judgment, and may not be susceptible to an all‑encompassing definition. However, an advisory opinion which is generally beyond federal jurisdiction can be described as being one which is “not based on a concrete situation” and one which “does not amount to a binding decision raising a res judicata between the parties”…
(Footnotes omitted)
In this matter, the Court had not yet determined whether it had jurisdiction to determine the matter and had not identified the nature and extent of the matter before it. The answer to those questions lay in the factual determinations, yet to be made, of the periods of the de facto relationship and when it broke down. The declaration was therefore not founded in facts, agreed or found. It did not determine any rights of the parties and was, instead, an opinion as to the jurisdiction of the Court if particular facts were found.
We should add that the answer provided was actually a preliminary ruling and, as it did not determine the parties’ rights, it should not have been the subject of a declaration.
In answer to this, the respondent submitted that the primary judge was undertaking a preliminary hearing as to the jurisdiction of the Court, which is entirely unremarkable. We do not accept this, as such an enquiry would have to determine whether the parties were in a de facto relationship on or after 1 March 2009.
The respondent also relied on s 31(1)(aa) of the Act, which confers acquired jurisdiction on the Family Court in “matters arising under this Act in respect of which de facto financial causes are instituted under this Act”. It was submitted that as the Court was seized of a de facto financial cause, the Court’s implied powers to regulate the process of the hearing applied. To some degree that is correct and would, for example, permit the Court to deal with the jurisdictional issue separately, to answer questions grounded in facts, or to make orders of the kind described in Norton & Locke. These powers do not extend the powers of the Court so as to permit it to answer the posed questions at the time that it did.
We are therefore satisfied that the declaration made by the primary judge was advisory only, should not have been asked, should not have been made and should be set aside. Although the applicant did not challenge the declaration on this ground, the Full Court when hearing an appeal is empowered by s 94(2) of the Act to make such order as ought to have been made in the first instance. In Warren v Coombes (1979) 142 CLR 531 at 553, Gibbs ACJ, Jacobs and Murphy JJ said “if the law confers a right of appeal, the appeal should be a reality, not an illusion; if the judges of an appellate court hold the decision of the trial judge to be wrong, they should correct it”. Leave to appeal will be granted and the appeal will be allowed to that extent.
It follows that it is neither necessary nor desirable to deal with the grounds of appeal or the Notice of Contention.
The matter will be remitted for further hearing but, as we have said, the questions that were posed to the primary judge were flawed in the manner that we have described and cannot be pursued in the absence of facts being found or agreed.
The parties sought the opportunity to provide written submissions as to costs and directions will be made to that effect.
I certify that the preceding fifty-two (52) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Ainslie-Wallace, Ryan & Aldridge JJ) delivered on 16 November 2020.
Associate:
Date: 16 November 2020
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