FINCH & FINCH
[2013] FamCA 567
•2 August 2013
FAMILY COURT OF AUSTRALIA
| FINCH & FINCH | [2013] FamCA 567 |
| FAMILY LAW – PROPERTY – Section 79A application – Consent Orders – Setting aside consent orders – Nature of consent – Whether there is implied consent to set aside consent orders – Default of consent orders – Where the consent orders refer to a deed of employment – PRACTICE AND PROCEDURE – Summary Dismissal. |
| Family Law Act 1975 (Cth) ss 79A, 117(2). |
| Beck & Beck (2004) FLC 92-181. | ||
| APPLICANT: | Mr Finch | |
| RESPONDENT: | Ms Finch |
| FILE NUMBER: | BRC | 9705 | of | 2012 |
| DATE DELIVERED: | Brisbane |
| PLACE DELIVERED: | 2 August 2013 |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Hogan J |
| HEARING DATE: | 18 March 2013 |
REPRESENTATION
| FOR THE APPLICANT: | Mr Finch in person |
| COUNSEL FOR THE RESPONDENT: | Mr Looney S C |
| SOLICITOR FOR THE RESPONDENT: | Cassandra Pullos Lawyers |
Orders
The Amended Initiating Application filed 21 December 2012 is dismissed.
The Husband pay the Wife’s costs of and incidental to the Amending Initiating Application filed 21 December 2012, excluding any costs associated with or, of and incidental to the appearance on 18 February 2013, with such costs to be agreed or, failing agreement, to be assessed in accordance with the Family Law Rules (2004) and on a party/party basis.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Finch & Finch 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 |
FILE NUMBER: BRC 9705 of 2012
| Mr Finch |
Applicant
And
| Ms Finch |
Respondent
REASONS FOR JUDGMENT
This matter first came before me on 18 February 2013. At that time, given that the Wife sought, inter alia, summary dismissal of his Initiating Application, I urged the Husband (who appeared on his own behalf) to take the opportunity to obtain legal advice. Senior Counsel who appeared for the Wife that day provided the Applicant and the Court with written submissions (“the Wife’s submissions”). I adjourned the matter to 18 March 2013. Thus, the Husband has had the opportunity to obtain legal advice about those submissions and he filed a submission in response on 6 March 2013 (“the Husband’s submissions”).
The Applications before the Court
The Husband relies on an Amended Initiating Application (“the Application”) filed 21 December 2012. In it he seeks, by way of final relief, an order pursuant to s 79A of the Family Law Act (Cth) (“the Act”) setting aside the Consent Order made in this Court on 20 January 2012 (“the Consent Order”).
Until the receipt the Husband’s submissions on 6 March 2013, it appeared that he sought the following interim relief:
a.an injunction restraining the Wife from disposing of property without written permission;
b.a declaration that the Deed of Employment (“the Employment Deed”) entered into by the Husband and B Pty Ltd was valid and he remained employed pursuant to it;
c.an order in the nature of a mandatory injunction, directing B Pty Ltd to pay to the Husband a $10,000.00 bonus he asserted was due and owing to him pursuant to the Deed;
d.an order that the Wife provide Certificates of Registration for certain specified items of property.
That is, prior to 2 March 2013, the Husband himself sought to enforce the terms of the Consent Order.
However, it is apparent from paragraph 4 of the Husband’s submissions that he no longer seeks such relief and has ‘fully withdrawn’ the interim application for preservation of property and other property orders.
In the Response to Initiating Application filed 12 February 2013 the Wife seeks the following interim or procedural orders:
a.that the Husband’s Application for interim and final orders be summarily dismissed; or
b.in the event that the Husband’s Application for Final Orders is not summarily dismissed:
i.an order pursuant to s 117(2) of the Act that the Husband pay the sum of $100,000.00 into Court within 7 days as security for costs;
ii.an order that the Application to set aside Consent Orders pursuant to s 79A be listed for a hearing on the discrete issue as to whether the circumstances set out in either s 79A(1)(a) or s 79A(1)(c) have been established by the Husband;
c.that the Husband pay the Respondent’s costs of and incidental to the Application on an indemnity basis.
As I confirmed with the Husband and Senior Counsel for the Wife on 18 March 2013, the consequence of the position adopted by the Husband (as set out in paragraph 4 of the Husband’s submissions) is that the only interim matters requiring my determination are those identified in paragraph 5 above.
The material that can be relied upon
Authority[1] establishes that, in determining the Wife’s application for summary dismissal, of the Application:
a.I must have regard only to the Husband’s material and material relied upon by him and any non-contentious facts[2]; and
b.I must proceed on the basis that the Husband’s ‘version of the facts’ is that which would ultimately be accepted at a trial.
[1]Webster v Lampard (1993) 177 CLR 598; Lindon v The Commonwealth (No 2) (1996) 70 ALJR 541, 544-5 per Kirby J; Bigg & Suzi (1998) FLC 92-799; Beck and Beck (2004) FLC 93-181.
[2] See also Miller v Harrington (2008) 39 FamLR 654, 664.
The Husband relied on the material listed in the Husband’s submission as well as his affidavit filed 1 November 2012. The Wife relied on the material listed in the Outline of Submissions of Wife.[3]
[3] Dated 18 March 2013.
The principles to be applied
Rule 10.12 of the Family Law Rules 2004 (“the Rules”) provides, relevantly, that a party may apply for summary orders if that party claims that an application is frivolous, vexatious or an abuse of process[4] or there is no reasonable likelihood of success.[5]
[4] Family Law Rules 2004 (Cth) r 10.12(c).
[5] Family Law Rules 2004 (Cth) r 10.12(d); Friar & Friar [2011] FamCAFC 71, [52] per Thackray & Watts JJ.
In Friar & Friar [2011] FamCAFC 71, Thackray & Watts JJ deal with the relevant principles at [48]-[53]. They noted,[6] and I agree, that the Rule is properly read as supplementing the power under s 118(1) of the Act to dismiss frivolous or vexatious proceedings and in the context of those cases which confirm the Court’s inherent power to dismiss or permanently stay an application which cannot succeed.
[6] Ibid at [50].
The principles which I must apply in determining whether to summarily dismiss the Application are as follows[7]:
a.the power for summary dismissal is a discretionary one and exceptional caution must be used in such applications;
b.the relief of summary dismissal “is rarely and sparingly provided”;
c.the Wife (the party seeking summary dismissal) must satisfy the test outlined above;
d.a weak case or one that is unlikely to succeed is not “sufficient” to warrant dismissal;
e.if there is a serious legal question to be determined, it should ordinarily be determined at a trial;
f.the issue is whether, on the Husband’s material, the Application should not be permitted to go to trial in the ordinary way because there is no reasonable likelihood of its success.
[7] See: Lindon v Commonwealth of Australia (No 2) (1996) 136 ALR 251, 256 per Kirby J; Bain Pacific Associations and Ors v Kelly & Ors (2006) FLC 93-270, [33]-[35]; Bigg & Suzi (1998) FLC 92-799; Pelerman & Pelerman (2000) FLC 93-037; Beck & Back (2004) FLC 93-181.
Further, in determining whether the Husband has no reasonable likelihood of success in prosecuting his claim to set aside the Consent Order, I must exercise caution in making such a finding where “contested evidence might reasonably be believed one way or the other so as to enable one side or the other to succeed”.[8]
[8] Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd (2006) 236 ALR 720, [45] per Rares J as referred to in Rogers & Jennings [2011] FamCAFC 222.
It is apparent from paragraph 8 of the Husband’s submissions that, whatever was the position prior to the filing of the same, his Application to set aside the Consent Order now rests upon ss 79A(1A), 79A(1)(b) or 79A(1)(c) of the Act. He abandons any reliance on s 79A(1)(a) of the Act.
Thus, the Wife’s application for summary dismissal requires a consideration of whether the Application to set aside the Consent Order on the basis that the following have no reasonable likelihood of success:
a.in the circumstances that have arisen since the Consent Order was made it is impracticable for the Consent Order to be carried out or impracticable for a part of it to be carried out: s 79A(1)(b) of the Act; or
b.the Wife has defaulted in carrying out an obligation imposed on her by the Consent Order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the Consent Order or to set the Consent Order aside and make another order in substitution for the Consent Order: s 79A(1)(c) of the Act; or
c.the parties have acted in such a manner that the Court should conclude that there is implied consent by both of them to the setting aside of the Consent Order and the making of another Order in substitution for the same: s 79A(1A) of the Act.
The factual matrix
The following matters constitute the factual framework within which the Wife’s application for summary dismissal is considered.
The parties married in 1975 when the Husband was 20 years of age and the Respondent 23 years of age. The parties separated in mid 2011. During the marriage the parties operated a business which provided training to individuals (“the business”).
After their separation, the parties engaged in a collaborative process through which they, with the assistance of their respective legal representatives, a chartered accountant and a therapist reached agreement as to the terms of the Consent Order.
On 19 January 2012, the parties caused to be filed in the Court an Application for Consent Orders which:
a.records the Husband as seeking a property settlement order such that he would receive 48 per cent of the total property of the parties; and
b.has annexed to it a Statement, prepared by the chartered accountant, detailing the property, liabilities, superannuation and financial resources of the parties, which recorded that the parties had a joint[9] net asset position, inclusive of superannuation, of some $4,800,000.00.
[9] Albeit that some assets were held in personal names, some assets were held within a Trust structure, and some within related entities, there was no dispute that all assets were property of the parties for the purpose of the proceedings.
On 20 January 2012, the Consent Order was made in accordance with the terms submitted to the Court.
The Consent Order provided, in Clause 7, that the Wife was ‘solely entitled’ to B Pty Ltd which operates under the trading name ‘B’. This was the entity through which and the name under which the parties operated the business during their marriage.
The Consent Order also provided, in Clause 20, that ‘the husband will be employed by B on the terms set out in the Employment Deed attached as Annexure A’ (“the Employment Deed”) to the Consent Order.
The Employment Deed[10] relevantly provided that:
a.it was conditional upon sealed orders issuing from the Family Court of Australia by 1 March 2012 and that, if no sealed Orders had issued by then, it was null and void as if it had never come into existence;[11]
b.the Husband was employed by B Pty Ltd from 19 January 2012 (the date on which the Employment Deed was executed by the parties);
c.the Husband’s base salary was $120,000.00 exclusive of superannuation with a bonus of $10,000.00 inclusive of superannuation;
d.if B Pty Ltd terminated the Husband’s employment for any reason other than serious misconduct within the first three years, the Husband would be paid and entitled to the benefit of the full Remuneration Package including the bonus for the remainder of the initial three years;
e.in the event that a dispute arose out of the Employment Deed the parties would participate in mediation.
[10] Annexure A to the Consent Order.
[11] Clause 17.12 of the Employment Deed.
It is not in dispute that the Husband was in fact employed by B Pty Ltd from 19 January 2012. Thus, I consider that the terms of Clause 20 of the Consent Order were in fact carried out by the parties.
The Husband received two official warnings from B Pty Ltd, the first on 7 February 2012.
On 8 February 2012, the Husband and Wife met to sign documents to give effect to the Consent Order and worked through and agreed upon ‘Additions and Clarifications to Employment Deed’[12]. These appear, from a reading of that document, to deal with matters associated with the Husband’s employment, such as the Husband being at liberty to work from home and the particularisation of those office supplies for which the Wife would pay.
[12] Applicant Husband’s affidavit filed 7 March 2013, Annexure ‘RF1’.
The Husband’s employment was terminated by B Pty Ltd on 29 March 2012.
On 29 March 2012, the Husband and the Wife entered into negotiations. The Husband says that “[the Wife] offered the Country C franchise and 12 months salary (in exchange for the termination of the [Employment Deed]). I accepted the offer.”
That day the parties signed a ‘Heads of Agreement’ (“the Agreement”) which provided that:
a.the Husband would receive a salary for 12 months from the date of the Agreement;
b.the Husband would develop and be granted the B franchise for Country C, to be renegotiated after a period of five years, with a contract to be drawn as per ‘normal franchise conditions’;
c.there would be (or was) a written undertaking not to pursue, amongst other things, threats to challenge the Consent Order;
d.all course content developed to date and all intellectual property owned by B was to remain the property of B as per the Consent Orders and up to and including ‘today’s date’;
e.B would provide written advice that they did not instigate police involvement and endorse the Husband having a firearm licence in Australia.
On his own description of the events on 29 March 2012, the Husband does not assert that the Wife offered the Country C franchise and 12 months salary ‘in exchange for setting aside Clause 20 of the Consent Order’ or ‘instead of’ the Consent Order.
Rather, he himself identifies that the Agreement was reached ‘in exchange for the termination of the [Employment Deed]’. That is, the parties compromised the Husband’s rights to recover from B Pty Ltd the payment of the balance of the three years of remuneration benefits by arriving at and executing the Agreement.
Consistent with the terms of the Agreement, the Husband received payments from the Wife up to and including 9 January 2013.
On 29 October 2012, the Husband filed an Initiating Application. He then filed the Application. In correspondence dated 15 January 2013 the Wife advised that no further monies would be paid.
The Husband says that, despite the terms of the Agreement as set out above, he has ‘not been allowed’ to operate a Country C franchise. This, he asserts, is a breach of the terms of the Agreement. For the purpose of considering the Application for summary dismissal, I accept this assertion. I accept, for this purpose, that the Husband may well be able to seek to enforce the terms of the Agreement or seek to sue upon it seeking appropriate redress.
The Husband’s case for relief pursuant to s 79A of the Act
As noted above, the Husband relies on s 79A(1)(b), 79A(1)(c) and s 79A(1A) of the Act.
Could a Court be satisfied in the circumstances that have arisen, since the Consent Order was made, that it is impracticable for the Consent Order to be carried out or impracticable for a part of it to be carried out: s 79A(1)(b) of the Act
The Husband submits that, given his termination, it is impracticable for the Consent Order or at least a part of it to be carried out. The interactions between the parties make it clear, he says, that they cannot continue to work together as is provided for by Clause 20 of the Consent Order.
Senior Counsel for the Wife submits that the Husband’s submissions suggest that the only part of the Consent Order he asserts is impracticable to carry out is Clause 20. He submits that, as the Husband was in fact employed on the terms set out in the Employment Deed, Clause 20 of the Consent Order has, in fact, been carried out. In such circumstance it is, he says, impossible for the Husband to succeed on an argument that it was or is impracticable for Clause 20 to be carried out.
Further he submits that there is no support for any submission that Clause 20 required that the Husband be employed for a long period of time – rather the terms of the Employment Deed itself specifically prescribe the consequences for each party in circumstances where the employment floundered or failed to be maintained.
Senior Counsel submits that the Husband’s claim that there has been a breach of the terms of the Employment Deed is irrelevant to the proper construction of the terms of Clause 20 of the Consent Order.
In La Rocca & La Rocca[13] Kay J. said, at p78,538:
My own view is that …the concept of impracticability, as referred to in this section, is akin to the application of the doctrine of frustration in contractual matters. What the Parliament is concerned with and what ought to be concerning the Court is the happening of events which cannot be reasonably foreseen, which will have the effect of causing an injustice to one of the parties if the happening of such events is not given effect to…
Now, in my view, what the appropriate application of s 79A(1)(b) ought to be is that circumstances that have arisen in which it becomes impracticable to carry out the orders are circumstances that could not reasonably have been contemplated and that in such circumstances, whilst impossibility is not the test and impracticability is, it may then become just and equitable to change the orders.
The potential insolvency of one of the parties in the future is not such a matter, in my view. In every case before the Court property values may change, go up or down, business may flourish or not flourish, the vicissitudes of life may affect one of the parties…However the commercial failure of one of the parties post the making of the orders which will lead to the orders not being capable of being fully implemented does not, in my view, amount to a basis on which to set the order aside.
[13] (1991) FLC 92-222.
In Cawthorn & Cawthorn[14], the Full Court commented, at p 85,059, that ‘the general approach of Kay J in La Rocca’s case (supra) appears to have been generally followed by Moss J in Franklin and McLeod (1994) FLC 92-481’ and continued further, to state, at p 85,060:
We also agree with the views of both Kay and Moss JJ that the concept of impracticability contained in s 79A(1)(b) is quite different from problems of enforcement that may arise due to a party’s insolvency. In such a case, the matter may well have to be deal with pursuant to the provisions of the Bankruptcy Act 1966. This, however, merely reflects the vicissitudes of life and is in harmony with the clean break principle enshrined in the Act. An application for a further settlement of property is not available in circumstances in which one party suddenly becomes immensely rich… Financial problems, such as have arisen in respect of the appellant, have never given rise to the successful invocation of the doctrine of frustration.’
All business activities however are subject to the vicissitudes if commercial life… Businesses may always be the subject of financial misfortune and it is not necessary, for the purpose of s 79A(1)(b) to be able to predict the precise form or nature of such a misfortune or the manner in which it may arise.’
[14] (1998) FLC 92-805.
And further, at p. 85,061:
However in our view a party cannot successfully seek an order pursuant to s 79A(1) as a result of that party’s own default unless such default was due to circumstances quite beyond that party’s control. This rests firstly upon the well established principle of law that no-one should profit by their own wrong doing. This principle clearly embraces the obligation to carry out the provisions of a court order. Secondly, it would normally not be just and equitable to grant relief under s 79A(1) in those circumstances.
I find that, as the evidence clearly establishes that the Husband was in fact employed by B Pty Ltd, any argument based on the asserted impracticability of this Clause of the Consent Order has no reasonable prospects of success.
It is clear that the Employment Deed clearly and specifically contemplates what is to occur in the event that the Husband was terminated. It also provides what is to happen in the event that the Husband was terminated for reasons other than ‘gross misconduct’ a term defined in the Employment Deed. Thus, it cannot be said that his termination on 29 March 2012 was an event that could not have been reasonably foreseen by the parties given that such possibility was specifically provided for.
The Husband asserted, in essence, that the Consent Order required that the parties work together indefinitely and because the interactions between them reached such a point that this did not occur, it was impracticable for the Consent Order to be carried out and it should be set aside. However, neither the Consent Order nor the Employment Deed provided that the Husband was to be employed for an indefinite period of time or for any particular period of time. The possibility of the Husband being terminated was contemplated and a remedy provided and, given this, I consider that this argument has no reasonable prospects of success.
I consider, also, that the Husband and Wife parties compromised the dispute between them about his termination by entering into the Agreement. This was the remedy which the Wife offered and the Husband accepted.
Could a Court be satisfied that the Wife has defaulted in carrying out an obligation imposed on her by the Consent Order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the Consent Order or to set the Consent Order aside and make another order in substitution for the Consent Order: s 79A(1)(c) of the Act
The Husband’s submissions identify that the Husband relies on Clause 20 of the Consent Order which is in the following terms:
The Husband will be employed by B on the terms set out in the employment deed attached as Annexure A.
Senior Counsel for the Wife submits that, even accepting the defaults as alleged by the Husband, they could not amount to defaults by the Wife in carrying out an obligation pursuant to the Consent Order in that:
a.the alleged faults relate to non-compliance with the Employment Deed and, even if there is a breach of the terms of the Employment Deed, the Wife has not defaulted in carrying out an obligation imposed on her by the Consent Order as she is not a party to the Employment Deed;
b.any breach of the Employment Deed is not a breach of the Consent Order.
However, the terms of s 79A(1)(c) of the Act are not restricted simply to a consideration of whether a party has defaulted with the terms of the Order itself. The section clearly refers to whether a party has defaulted ‘in carrying out an obligation imposed on that party by the terms of the Order’.
The Wife received B Pty Ltd as a consequence of the terms of the Consent Order. She agreed that B Pty Ltd would employ the Husband on the terms contained in the Employment Deed. The Husband was employed by B Pty Ltd on the terms set out in the Employment Deed. Further, by entering into a mediation style process following the Husband’s termination, the parties embarked on the very process prescribed by the terms of the Employment Deed.
The parties compromised the dispute between B Pty Ltd and the Husband arising out of the Husband’s termination when, as outlined in paragraphs 28 and 29 of these Reasons, they entered into the Agreement. As noted above, the terms of the Agreement have been put partially into effect by the parties and it may well be open for the Husband to seek to enforce the Agreement or seek remedies consequent upon any breach of it, if this is established on the evidence, in the appropriate forum.
The Husband recognises this by deposing[15] that, if the Wife succeeds in her current application, he will ‘be left with attempting to either enforce (a) the original employment deed – if possible or (b) the Agreement of 29 March 2012.’
[15] In paragraph 40 of his Affidavit filed 7 March 2013.
The Husband did not refer, in his Submissions, to the wife’s asserted non-compliance with the requirement to provide him with certain chattels. I conclude, though, that he relies on such non-compliance as a basis for setting aside the Consent Order.
Senior Counsel submitted that, even if I concluded that the Wife defaulted in carrying out these obligations imposed by the Consent Order, there is no evidence relied on by the Husband to show that circumstances, or their nature, have arisen as a result of the default, such that it is just and equitable to set aside the Consent Order.
I consider that the Husband could seek to enforce the terms of the Consent Order in so far as his assertions about the non-provision of chattels is concerned and that, given the relativities between the value of the property dealt with in the Consent Order and the value of the chattels, his claim to set aside the Consent Order on this basis has no reasonable prospects of success.
For the reasons outlined above, I consider that the Husband’s case for setting aside the Consent Order based on this ground has no reasonable prospects of success.
Could a Court be satisfied the parties have acted in such a manner that the Court should conclude that there is implied consent by both of them to the setting aside of the Consent Order and the making of another Order in substitution for the same: s 79A(1A) of the Act
The following principles apply:
a.it is not an element of s 79A(1A) that the relevant consent of the parties must go to both the setting aside of the ‘original’ order and to the terms of the further order, where such order is sought, to be made in lieu of it and consent is essential only to the variation or setting aside of the ‘original order’ but not to the making or the form of a new order in substitution of the one set aside; [16]
b.there is no doubt that parties can expressly or by their conduct impliedly consent to the discharge of prior orders so as to enable the court to make a fresh property order;[17]
c.the consent referred to may be established by evidence of a prior consent of the parties which remains binding upon them and consent is not confined to consent given at the time of the hearing of the application;[18]
d.the intention of parties to set aside an existing order may crystallize as time progresses and they conduct themselves in such a manner that it becomes inconsistent with any conclusion other than that they had consented to setting aside a previous order.[19]
[16] In the Marriage of Bourke (1994-1995) 18 Fam LR 1,11-13.
[17] McCabe and McCabe (1995) FLC 92-634, 82,370.
[18] Ibid at 82,369.
[19] Ibid at 82,369.
Senior Counsel for the Wife submitted to the effect that, for the Husband to succeed on the basis of s 79A(1A) of the Act, the necessary consent of the parties to a setting aside of the Consent Order:
a.may be established by evidence of a prior express agreement or oral statement of intention which remains binding on them at the time of the application;
b.may be inferred from conduct of the parties but, where conduct is relied upon as the basis for the drawing of such inference, it must be obvious and overt and unequivocally referrable to consent and inconsistent with refusal.
There is no suggestion in the Husband’s case that there is evidence of a prior consent of the parties other than by conduct as referred to below. There is no evidence before the Court that the Wife specifically consented in writing or by way of oral statement of intent to the setting aside of the Consent Order.
The Husband submits that the parties conducted themselves entirely inconsistently with the Consent Order in that they:
a.agreed to “additions and Clarifications to Employment Deed” on 8 February 2012; and
b.reached the Agreement.
He said that this conduct was inconsistent with any conclusion other than that they had consented to a setting aside of the Consent Order.
Senior Counsel submitted that the ‘only evidence’ of conduct by the Wife on which the Husband seeks to rely as the basis for the submission that the Court could be persuaded to conclude that an inference should be drawn that she consented by her conduct to the setting aside of the Consent Order is that:
a.she is alleged to have defaulted under two (2) specific provisions of the Consent Order;
b.she has not complied with the Employment Deed;
c.the parties entered into a new agreement in relation to the Husband’s employment with B Pty Ltd: the Agreement.
Senior Counsel submitted that, for the purpose of argument, assuming that the Wife did in fact default in her performance of certain provisions of the Consent Order and that there was non-compliance with the terms of the Employment Deed, such default:
a.related only to part of the Consent Order and not its entirety;
b.was as equally consistent with a failure to comply with the terms of the Consent Order as with consent to setting aside the Consent Order.
It was submitted that the Wife’s conduct in entering into the Agreement with the Husband was not capable of supporting an inference that she consented to the setting aside of the Consent Order as it was conduct that was equally consistent with a compromise of the Employment Deed.
Further, Counsel submitted that the Husband himself characterised the Wife’s conduct as being ‘in default of’ the terms of the Consent Order rather than as consenting to set the Consent Order aside. Counsel submitted that such conduct is ‘not capable’ of supporting an inference that the Wife consented to the Consent Orders being set aside.
I consider that the Wife’s actions in entering into the Agreement were not unequivocally referrable to a consent to set aside the Consent Order arrived at after engagement in the collaborative process referred to above. Such actions are, I consider, at least equally consistent with a desire to compromise the situation which had arisen as a result of the Husband’s termination. Further, as noted above, the Husband himself first sought to enforce the terms of the Consent Order. This demonstrates that he did not consider that the parties had, by their conduct or otherwise, agreed to setting the same aside.
I conclude that there is nothing in the evidence which is capable of supporting a conclusion that the Wife had a clear intention to no longer be bound by the terms of the Consent Order and had consented to it being set aside. I consider that the conduct of the parties as particularised in paragraphs 28 to 32 is in no way inconsistent with any conclusion other than that they had consented to setting aside the Consent Order.
For the reasons outlined above, I consider that the Husband’s Application to set the Consent Order aside on this basis has no reasonable prospects of success.
Costs
The general rule in proceedings under the Family LawAct 1975 (Cth) (“the Act”) is that each party bears his or her own costs. However, if the Court is of the opinion that there are circumstances that justify it in doing so the Court may, subject to certain considerations, make such order as to costs as the Court considers just.
In considering what order as to costs, if any, to make, the Court shall have regard to a number of specified matters prescribed by s.117(2A) of the Act.
The value of the property deal with by the Consent Order was in the vicinity of $4,800,000.00. Whilst as a consequence of the terms of the Consent Order the Husband received property having a value of about $2,304,000.00 his evidence is that he is unable to access much of this currently because of the manner in which it is held.
The Husband is unemployed. He says that his financial circumstances are poor. The Wife accepted, via the submissions made on her behalf, that the Husband’s assets in Australia, other than superannuation, are likely to have a realised value of less than $200,000.00 (none of which is represented by funds at bank) and that it is unclear whether any of the Husband’s interest in a trust which owns property in Country C could be utilised to meet any costs order made against him – albeit that such submission was made in the context of advancing the Wife’s claim for security for costs and in respect, therefore, of his ability to meet an order for costs of an amount in the vicinity of $100,000.00 to $200,000.00.
The Wife received property having a value of about $2,496,000.00 as a consequence of the Consent Order. She has not filed a Financial Statement in the proceedings and I consider that I am at liberty to conclude that she does not raise any inability on her part to fund her own legal representatives as forming part of her application that the Husband pay her costs.
Both parties previously engaged in the collaborative process which is, more likely than not, to have involved significant cost given the involvement of lawyers for each of them, a chartered accountant and a therapist. These proceedings have, it is more likely than not, exposed at least the Wife to further not insignificant cost.
Neither party is in receipt of assistance by way of legal aid. I am not persuaded that there is anything in the conduct of either party in the prosecution of their competing positions before me that is relevant to a determination of whether the circumstances justify a departure from the starting premise that both parties bear their own costs.
The Wife has been wholly successful in her application for summary dismissal.
I consider that whilst the Husband acts for himself, this is no ‘shield’ to an order for costs should the circumstances otherwise justify the making of such an Order.
I consider that, given that the husband himself first sought to enforce the terms of the Consent Order and that the Wife has been wholly successful in her application for summary dismissal of the Husband’s application to set aside the Consent Order, the circumstances are such as to justify the making of an order that the Husband pay the Wife’s costs of and incidental to the Application filed 21 December 2012 save for the costs associated with and of and incidental to the first appearance before me given that, at that time, the Wife had only just served the Husband with her application for summary dismissal.
I turn now to consider the basis upon which such costs should be paid given that the Wife has sought that they be paid on an indemnity basis. Unless there are exceptional circumstances, an order for costs should be made on a party and party basis.
I have had regard to D & D Costs (No. 2) (2010) FLC 93-435 in which the Full Court reviewed extensively earlier authorities, including Limousin & Limousin (Costs) (2008) 38 Fam LR 478 and Kohan and Kohan (1993) FLC 92-340, and also Sheppard J’s decision in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248.
There is no evidence before me to establish the actual quantum of costs which would be payable by the Husband to the Wife if I was persuaded to make an order for indemnity costs.
I am not persuaded, on the evidence before me, that the circumstances of this case are ‘exceptional’ circumstances which warrant the making of an order for costs on an indemnity basis.
I order accordingly.
I certify that the preceding eighty-three paragraphs are a true copy of the reasons for judgment of the Honourable Justice Hogan delivered on 2 August 2013.
Associate:
Date: 2 August 2013
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