D and D - [2003] FMCAfam 343

FEDERAL MAGISTRATES COURT OF AUSTRALIA

D & D

[2003] FMCAfam 343

FAMILY LAW – Property application more than 12 months after decree nisi – s.44(3) Family Law Act 1975 explanation for delay not a precondition to extension of time – delay a relevant matter – solicitors negligent advice should not prejudice application.

Family Law Act 1975, ss.44(3), 79

McDonald v McDonald (1997) FLC 90-317
Frost v Nicholson (1981) FLC 91-051
Perkins v Perkins (1979) 90-600
Comcare v Ahearn (1993) 119 ALR 85
Jess v Scott (1986) 12 FCR 187
Dix v CrimesCompensation Tribunal (1993) 1 VR 297
Neocleous and Neocleous (1993) FLC 92-377
Kercher v Kercher (1981) FLC 91-041

Applicant:

S D

Respondent:

N J D

File No:

CAM187 of 2003

Delivered on:

18 July 2003

Delivered at:

Canberra

Hearing date:

18 July 2003

Judgment of:

McInnis FM

REPRESENTATION

Counsel for the Applicant:

Mr Brzotowski

Solicitors for the Applicant:

Mazengarb Barralet

Counsel for the Respondent:

Mr Clifford

Solicitors for the Respondent:

Lesley Hastwell & Associates

ORDER

The applicant be granted leave nunc pro tunc pursuant to s.44(3) of the Family Law Act 1975 to commence the application filed 14 February 2003.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
CANBERRA

CAM187 of 2003

S D

Applicant

And

N J D

Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

This is an application by S D (the applicant) filed 14 February 2003 where she claims against N J D certain relief under s.79 of Family Law Act 1975 (the Act). In the claim the applicant first has to make application to this Court pursuant to s.44(3) of the Act for leave to commence the proceedings under s.79 of the Act. It is that application that I shall be dealing with this day.
Section 44(3) of the Family Law Act provides that proceedings shall not be instituted in relation to matters of this kind after the expiration of 12 months after the date of making a decree nisi.
There is no doubt in the present case that the time period has indeed past in relation to the time within which the applicant should commence proceedings under s.79. A decree nisi was granted on

17 February 2000 and that decree became absolute on 18 March 2000. It is clear in this case that the parties had been married for a lengthy period of time, in fact they were married on 19 November 1983. They separated at least formally on 5 July 1997. There is some dispute about whether the parties separated under the one roof prior to that date. It is asserted by the applicant that separation had occurred under the one roof in April 1997, that assertion is in dispute, it is not necessary for me to resolve it in this application. There are two children of the marriage, S D born 5 October 1985 and D D born 15 October 1987.
In support of the application to be granted leave to make the applicant effectively out of time under s.44(3) of the Act the applicant has relied upon affidavit material, in particular an affidavit sworn by her on

14 February 2003. She has relied upon other material to which I shall refer presently. Significantly in her affidavit she refers to the relationship and it is noteworthy that the respondent was said to have been engaged in the navy for a considerable period of time. He enlisted in 1980 and was discharged on 2 September 2002, which I take to be formal discharge and note that he at least appears to concede, and this is common ground, that he was to resign around July 2002.
In her affidavit the applicant refers to the past marital history and the children. The parties were married for 14 years of the 22 years of service of the respondent in the navy. It is not in dispute that the applicant has had, and continues to have, the day to day care and responsibility of the two children of the marriage. In her affidavit reference is made to details concerning what can only be described as somewhat meagre property assets at the time of separation.
The real issue relates to the question of what followed after receipt of a lump sum payment upon resignation by the respondent from the defence services as indicated on 2 September 2002. In her affidavit the applicant states that the husband resigned from the defence services on 2 September 2002, he received a lump sum payment gross of $106,339.20 from which tax of $17,052.15 was paid, leaving a net payment of $89,287.04. He further received a roll over payment paid to A F L of $26,905.46. He is also entitled to receive a pension of $18,020.84 per annum. This translates to a fortnightly pension of $691.21 gross, less tax of $194, leaving a net amount payable of $497.21.

In her affidavit the Applicant states:
“When I first separated from the husband I obtained legal advice from P M, a solicitor ………….. I was referred to him by the Legal Aid Office. I had a discussion with this solicitor. Following this discussion I understood I could not commence any proceedings until he retired from the Navy.”
In the same affidavit the applicant refers to a discussion which allegedly took place between her and the respondent in or about July 2002. Around that time she recites a precise discussion which she alleges occurred. It is not necessary for me to recite all of the discussion alleged, save to say that it is in dispute that there was a discussion of the kind in the precise terms referred to by the applicant, but nevertheless it does not seem to be in dispute that a discussion took place and for the purpose of this application I conclude a discussion took place concerning whether or not the respondent was to pay anything to the applicant. The applicant has asserted there was a reference to an amount being paid of $20,000, that matter is in dispute and it is not necessary for me to make a formal finding about that matter.
In a financial statement the applicant refers to her own income position and essentially she received, according to a corrected version of that document, what is described to be maintenance by way of child support of $24 per week, that is $12 per week per child. As I understand it the total salary of the applicant before tax is $615 per week. She otherwise refers to her outgoings and expenses.
During the course of this application the respondent relied upon an affidavit and response. The affidavit in support of the response sets out the respondent's chronology and version of events. It is not necessary to refer to that material in detail save that he asserts that at the time of separation the parties had significant liabilities and he otherwise refers to and analyses the asset holding including motor vehicles. Again it seems to me it is not necessary for me at this stage to analyse the minute details alleged by the respondent, or at least those issues where he seeks to challenge assertions made by the applicant. He does state that during the course of the marriage he was the primary bread winner and the applicant was the primary home maker.
A number of conclusions can be drawn from the affidavit material to which I have referred. The first is that the marriage appears to be what might be described as a conventional arrangement with the applicant being the prime caregiver and home maker and the respondent being the prime income earner during the course of most of the period of the marriage. It is also clear that for at least 14 of the 22 years when the respondent was receiving and had the benefit of accruing his superannuation within the service the parties were living together.
In addition to the affidavit material I permitted the applicant to tender as exhibit A1 a document which I have described as a draft financial statement dated 30 August 2002. That document was presented after some discussion took place and quite justifiably counsel for the respondent raised the issue of an explanation for delay, and in particular delay not just from the twelve month period after the decree nisi, but further the delay that has occurred since it is said the discussion took place regarding possible payment by the respondent to the applicant that is July 2002, and since it was conceded there at least was an attempt to seek legal advice in or about August 2002 and bring the application before this Court which was not filed until 14 February 2003.
Further information was provided without objection that the current solicitors acting for and on behalf of the applicant had been engaged on or about 11 November 2002 and again submissions were made in relation to that delay to which I shall refer presently. It was in the context though of those submissions that I decided to accept as exhibit A1 without objection, the financial statement dated 30 August 2002.
Both counsel have referred me to the relevant provision in the legislation. During the course of the submissions it was initially urged upon the Court that I should consider and apply the principles set out in the decision of McDonald v McDonald (1997) FLC 90-317. The case was followed in the decision of Frost v Nicholson a decision of a single Judge, Nygh J, which is reported in (1981) FLC 91-051.
In his decision Nygh J, refers to what must be established by an applicant in order to take advantage of an order under s.44(3). His Honour refers to three factors arising out of the McDonald case, one, a reasonable prima facie case for relief that she instituted proceedings in time; two, that denial of the wife's claim would cause her hardship and; three, an adequate explanation as to her delay.
Further reference was made to other decisions in this matter including the decision in the case of Perkins v Perkins (1979) 90-600. That case appears to follow what the Court had said in McDonald and in a sense provides some assistance to the respondent in the present case. In the case of Perkins it seemed that the Court was prepared to accept, as an obligatory factor to be proved, an explanation for delay. During the course of submissions I had raised with both the representatives of the parties who I should add have fully and thoroughly argued the case on behalf of their respective clients, the more general issue as to whether or not s.44(3) does indeed require as a pre-condition to the exercise of the Court's discretion in granting leave, that the applicant must provide an explanation for the delay.
I drew the attention of the parties to the decision of the Full Court of the Federal Court of Australia in the matter of Comcare v Ahearn (1993) 119 ALR 85. In that case although dealing with rights of an applicant to pursue a claim before the Administrative Appeals Tribunal the Court in my view relevantly held that delays by a solicitor in commencing appeal proceedings need not be visited upon a client. Inexcusable delay on the part of the solicitor may amount to an acceptable explanation for delay. The Court went on to say at p.88 the following:
“Although it is to be expected that such an explanation (for delay) will normally be given, as a relevant matter to be considered, there is no rule that such an explanation is an essential precondition …”.
In the first of those findings the Court applied and followed what was said in Jess v Scott (1986) 12 FCR 187 and in the case of Dix v CrimesCompensation Tribunal (1993) 1 VR 297. It is clear that one should distinguish between the rights of a litigant in Tribunal proceedings or of a similar kind to rights of a litigant in inter parties disputes such as an application under s.79 of the Act. I was concerned during the course of submissions that one should not rely too heavily on the authority of cases such as Ahearn's case and not be too willing to apply those principles to a case of this kind, particularly having regard to the authorities which clearly bind this Court, including the decision of the Full Court in McDonald v McDonald.
However, I was further referred to the decision of the Full Court of the Family Court in a more recent decision of Neocleous and Neocleous (1993) FLC 92-377. In particular I was taken to that part of the decision which appears at page 79,922, where there is a clear analysis of the law that followed from McDonald v McDonald. Reference is made to that decision being followed by a further decision of the Court in Kercher v Kercher (1981) FLC 91-040. At page 79,915 per Fogarty and Nygy JJ,
“In the end result her Honour did not consider the issue of the explanation of the delay in this case to be of much importance. Despite what was said by the Full Court in Kercher and Kercher (1981) FLC 91-040; (1981) 7 Fam LR 216, it is clear from later decisions that the absence of an explanation for delay is no more that a factor to be considered in the circumstances of the case: Althaus and Althaus (1982) FLC 91-233; (1979) 8 Fam LR 169; Carlon and Carlon (1982) FLC 91-272; (1982) 8 Fam LR 729, especially at FLC 77,532-77,534; Fam LR 735-737 per Ellis, Emery and McGovern JJ.”
It is significant however to note that in Neocleous the Court refers to a change, or what I might describe as a softening of attitude. In recent times there has been a more liberal view taken on the discretion and indeed a less restrictive approach to the question of delay. I take that decision to now mean that the obligatory or mandatory nature of the requirement set out in McDonald v McDonald no longer applies, that it is not a necessary pre-condition to an application nor it the case that an applicant in every application under s.44(3) the applicant must give an explanation for delay.
However it is clear also from the cases and in particular Ahearn that in normal cases it would be expected that some explanation would be given to delay. In Ahearn at page 88, the Court stated in similar terms to the Court in Neocleous the following:
“We note the Tribunal used language that it might be taken to suggest that it is a pre-condition for success in such an application that an acceptable explanation for the delay must be given. Although it is to be expected that such an explanation would normally be given as a relevant matter to be considered there is no rule that such an explanation is an essential pre-condition.”
In my view therefore the explanation for delay, having been given, is but one of the factors that the Court needs to take into account. In the present case the facts and circumstances described in the affidavit material of the applicant clearly indicate at the very least a prima facie case. That fact does not seem to be seriously contested in the submissions made for and on behalf of the respondent and quite properly as an issue was not pursued. There are however the two remaining issues which I regard as relevant, finding as I do that I do not believe that there is sufficient evidence of prejudice in relation to the respondent over and above the normal prejudice that would operate, that is he be subjected to proceedings. It is my view that the remaining two issues of hardship and the explanation of delay require further attention.
The passage that I read out from the affidavit of the applicant, whilst referring to the reason for delay, is in my view an explanation which of its nature appears somewhat vague. A great deal of criticism was made of the explanation by counsel for the respondent. It was stated that whilst that advice may have been given that effectively as I understand the submission for the respondent, the applicant thereafter sat on her rights. She did not pursue any further advice, even after the July 2002 altercation with the respondent, she did not pursue her rights it was argued with any degree of vigour, or at all, thereafter until later in that year there did appear to be some delay between August 2002 and November 2002 when she engaged her present solicitors. In my view they are criticisms which the Court must consider.
Further it was submitted, I need to take into account in any event, the issue of whether there has been sufficient established by way of hardship. It seems to me that the hardship is a difficult matter to define in the context of a case of this kind. But where an applicant continues to have the responsibility of the day to day care of two teenage children with what can only be described as a meagre contribution assessed at $14 per week per child, despite her earnings being now somewhat greater than the pension received by the 40 year old respondent, I am satisfied in all the circumstances that to be precluded from pursuing this application would constitute and cause sufficient hardship of a kind that is relevant to this application.
I return to the issue of delay. I have been concerned about the issue of delay and concerned about the failure of the applicant to pursue with any degree of vigour her rights. I am particularly concerned that in matters of this kind it is clear that the decree nisi, which has clearly been served on both parties upon becoming absolute, contains notes. The notes are there for the assistance of parties in order to ensure that they are aware of their rights. Note 4 reads:
“If a party to the marriage proposes to make any application to the court as to property or as to the maintenance of that party, such application must be made within 12 months of this decree becoming absolute. After that time such an application cannot be made without first obtaining the leave of the court to do so.”
It is not disputed that those words are clear in their meaning and intent. It could not be seriously argued that those words do not accurately reflect the state of the law. There is no evidence before me as to whether or not the applicant upon receiving that document bothered to read the notes. It has been submitted that it is not unusual for parties not to focus too closely on documents of a kind such as the decree nisi. It has also been submitted that the Court should make due allowance for the fact that the applicant is not a professional person familiar with litigation and that in all the circumstances having been married to a person enlisted in the navy where retirement is clearly a significant date, where benefits would normally flow, that she was perhaps comforted by what otherwise would normally occur by what is now conceded to be the erroneous advice which she earlier sought from solicitors indicating she should wait till the respondent retired. It is submitted that in those circumstances the Court should not unduly scrutinise or penalise the applicant for her failure to take action.
Weighing up the evidence as I am required to do in matters of this kind and exercising the discretion according to law and looking at the factors that I consider to be relevant, in the present case I am as I indicate satisfied there is a prima facie arguable case, that there is evidence of hardship, that there is not evidence of prejudice of a kind to prevent me from making an order granting leave to the applicant to make the application or to commence the proceedings. In the present case despite some reservations I am prepared to accept the explanation of the applicant as a relevant matter. I accept the explanation is adequate, albeit barely adequate, but it does explain why she was perhaps content to remain in what I would describe as a ‘comfort zone’ awaiting the resignation of the respondent before proceeding further to take action of a kind contemplated under s.79 of the Act consistent with the authority of Ahearn the applicant should not be prejudiced by the negligence advice of her former solicitor. In the circumstances I am prepared to accept that there has been an adequate explanation and it follows from that that I will make the appropriate orders.

I certify that the preceding twenty-seven (27) paragraphs are a true copy of the reasons for judgment of McInnis FM

Associate:

Date: 18 July 2003